Company: NNN
Filing Date: 2025-06-24
Form Type: 424B5
Source: 0001193125-25-145374
Chunk: 122

Company: NNN REIT, INC.
Filing Date: 2025-06-24
Form: 424B5
Chunk 122
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 any excess after the
basis is reduced to zero will result in taxable gain. If the holder had different basis in its shares, then the amount allocated could reduce some of the basis in certain shares while reducing all the basis and giving rise to taxable gain in others.
Thus the taxable U.S. stockholder could have gain even if the holder’s basis in all its shares exceeded such portion. The previously proposed Treasury regulations would permit the transfer of basis in the redeemed shares of the preferred stock
to the taxable U.S. stockholder’s remaining, unredeemed preferred stock (if any), but not to any other class of shares held (directly or indirectly) by the taxable U.S. stockholder. Instead, any unrecovered basis in the preferred stock would be
treated as a deferred loss to be recognized when certain conditions are satisfied. On

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March 28, 2019, these proposed regulations were withdrawn. As a result, the treatment of adjustments to basis of a taxable U.S. stockholder’s preferred stock with respect to amounts
treated as a distribution with respect to preferred stock, but not a dividend, as well as the treatment of the basis of any unredeemed shares, may be less certain. We urge you to consult your tax advisor concerning the treatment of a cash redemption
of our preferred stock.

Redemption or Conversion of Preferred Stock to Common Stock.Assuming that preferred stock will not
be redeemed or converted at a time when there are distributions in arrears, in general, no gain or loss will be recognized for U.S. federal income tax purposes upon the redemption or conversion of our preferred stock at the option of the holder
solely into common stock. The basis that a taxable U.S. stockholder will have for U.S. federal income tax purposes in the common stock received will be equal to the adjusted basis the holder had in the preferred stock so redeemed or converted and,
provided that the preferred stock was held as a capital asset, the holding period for the common stock received will include the holding period for the preferred stock redeemed or converted. A holder, however, will generally recognize gain or loss
on the receipt of cash in lieu of a fractional common share in an amount equal to the difference between the amount of cash received and the holder’s adjusted basis in such fractional share.

If a redemption or conversion occurs when there is a dividend arrearage on the preferred stock and the fair market value of the common stock
exceeds the issue price of the preferred stock, a portion