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Item 9A. Controls and Procedures

2024-02-14 compared with 2023-02-21 · 310 added, 311 removed, 1004 unchanged (38% of the section changed)

Controls and Procedures

As required by Rule 13a-15(b) and Rule 15d-15(b) under the Securities Exchange Act, our management, including our Principal Executive Officer and our Principal Financial Officer evaluated as of December 31, 2022, the effectiveness of our disclosure controls and procedures as defined in Exchange Act Rules 13a-15(e) and Rule 15d-15(e).

Based on that evaluation, our Principal Executive Officer and our Principal Financial Officer concluded that our disclosure controls and procedures, as of December 31, 2022, were effective for the purpose of ensuring that information required to be disclosed by us in this report is recorded, processed, summarized and reported within the time periods specified by the rules and forms of the Exchange Act and is accumulated and communicated to management, including the Principal Executive Officer and our Principal Financial Officer as appropriate to allow timely decisions regarding required disclosures.

As required by Rule 13a-15(b) and Rule 15d-15(b) under the Exchange Act, our management, including our Principal Executive Officer and our Principal Financial Officer evaluated as of December 31, 2023, the effectiveness of our disclosure controls and procedures as defined in Exchange Act Rules 13a-15(e) and Rule 15d-15(e).

Based on that evaluation, our Principal Executive Officer and our Principal Financial Officer concluded that our disclosure controls and procedures, as of December 31, 2023, were effective for the purpose of ensuring that information required to be disclosed by us in this report is recorded, processed, summarized and reported within the time periods specified by the rules and forms of the Exchange Act and is accumulated and communicated to management, including our Principal Executive Officer and Principal Financial Officer as appropriate to allow timely decisions regarding required disclosures.

Management’s Report on Internal Control Over Financial Reporting

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Independent Registered Public Accounting Firm’s Report on Internal Control Over Financial Reporting

KPMG LLP, an independent registered public accounting firm, has audited the Company's consolidated financial statements included in this Annual Report on Form 10-K and, as part of its audit, has issued its report, included herein on page F-4, on the effectiveness of our internal control over financial reporting.

KPMG LLP, an independent registered public accounting firm, has audited the Company's consolidated financial statements included in this Annual Report and, as part of its audit, has issued its report, included herein on page F-4, on the effectiveness of our internal control over financial reporting.

Changes in Internal Control over Financial Reporting

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Directors, Executive Officers and Corporate Governance

The information called for by this Item is incorporated by reference to the information set forth in our definitive Proxy Statement, to be filed with the SEC within 120 days after the end of the Company's fiscal year ended December 31, 2022 in connection with our 2023 Annual Meeting of Stockholders, and is incorporated herein by reference.

The following information with respect to our board of directors and executive officers is presented as of February 13, 2024:

Name Age Position at IVT Principal Employment

Busch 42 President, Chief Executive Officer & Director Same

David 45 Executive Vice President, Chief Operating Officer, General Counsel and Secretary Same

Phillips 42 Executive Vice President, Chief Financial Officer and Treasurer Same

Stuart Aitken 52 Director Senior Vice President and Chief Merchant and Marketing Officer at The Kroger Co., a grocery retailer

Amanda Black 48 Director Managing Director and Global Chief Investment Officer at JLP Asset Management, a real estate investment firm

Glavin 64 Director Owner of Thomas F.

Glavin & Associates, Inc., a certified public accounting firm

Nelson 67 Director Principal of SAN Property Advisors, a retail real estate advisory firm

Paula Saban 70 Director Development Director of Interim Execs, a placement firm for interim CXO's

Shah 50 Director Chief Executive Officer of SPAAN Tech, Inc., an architecture, engineering, and project management firm

Stein 74 Director Retired

Julian Whitehurst 66 Director Retired

Other information called for by this Item is incorporated by reference to the information set forth in our definitive Proxy Statement, to be filed with the SEC within 120 days after the end of the Company's fiscal year ended December 31, 2023 in connection with our 2024 Annual Meeting of Stockholders, and is incorporated herein by reference.

Executive Compensation

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The following table provides information regarding our equity compensation plans as of December 31, 2023.

Plan Category Plan Description Number of Shares

Issuable Upon Vesting (a) Number of Securities Remaining Available for Future Issuance Under Equity Compensation Plans (Excluding Securities Reflected in column I )

Equity compensation plans not

approved by stockholders:

Incentive Award Plan (b) 1,172,363 536,429

Equity compensation plans

not approved by security holders:

Number of Shares Issuable Upon

Vesting of Outstanding RSU Awards (a) Number of Securities Remaining Available for

Future Issuance Under Equity Compensation Plans

(Excluding Securities Reflected in column I ) (b)

Incentive Award Plan (c) 835,478 1,060,241

Represents restricted share unit ("RSU") awards outstanding under the Incentive Award Plan as of December 31, 2022.

Includes shares of common stock available for future grants under the Incentive Award Plan as of December 31, 2022.

The weighted average grant date price per share of common stock underlying the unvested restricted stock units based on total outstanding restricted stock units as of December 31, 2022 was $23.35 .

approved by stockholders:

ESPP N/A 3,288,272

Total 1,172,363 3,824,701

(a) Represents restricted share unit ("RSU") awards outstanding under the Incentive Award Plan as of December 31, 2023.

(b) The weighted average grant date price per share of common stock underlying the unvested restricted stock units based on total outstanding restricted stock units as of December 31, 2023 was $19.36.

Certain Relationships and Related Transactions, and Director Independence

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Consolidated Balance Sheets as of December 31, 202 3 and 202 2

Consolidated Statements of Operations and Comprehensive Income (Loss) for the years ended December 31, 2022, 2021 and 2020

Consolidated Statements of Operations and Comprehensive (Loss) Income for the years ended December 31, 2023, 2022 and 2021

Consolidated Statements of Equity for the years ended December 31, 2023, 2022 and 2021

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(incorporated by reference to Exhibit 3.1 to the Registrant’s Form 8-K, as filed by the Registrant with the SEC on April 28, 2022)

Third Amended and Restated Bylaws of the Company, dated as of October 12, 2021 (incorporated by reference to Exhibit 3.1 to the Registrant’s Form 8-K, as filed by the Registrant with the SEC on October 12, 2021)

Articles of Amendment of InvenTrust Properties Corp.

(incorporated by reference to Exhibit 3.1 to the Registrant’s Form 8-K, as filed by the Registrant with the SEC on May 8, 2023)

Fourth Amended and Restated Bylaws of the Company, dated as of May 5, 2023 (incorporated by reference to Exhibit 3.2 to the Registrant’s Form 8-K, as filed by the Registrant with the SEC on May 8, 2023)

Statement regarding restrictions on transferability of shares of common stock (to appear on stock certificate or to be sent upon request and without charge to stockholders issued shares without certificates) (incorporated by reference to Exhibit 4.4 to the Registrant’s Amendment No.

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Description of Securities Registered Pursuant to Section 12 of the Securities Exchange Act of 1934

Amended and Restated Master Management Agreement, dated as of March 12, 2014, by and between Inland American Real Estate Trust, Inc.

and Inland American Retail Management LLC (incorporated by reference to Exhibit 10.1 to the Registrant’s Form 8-K, as filed by the Registrant with the Securities and Exchange Commission on March 13, 2014)

Amended and Restated Master Management Agreement, dated as of March 12, 2014, by and between Inland American Real Estate Trust, Inc.

and Inland American Office Management LLC (incorporated by reference to Exhibit 10.2 to the Registrant’s Form 8-K, as filed by the Registrant with the Securities and Exchange Commission on March 13, 2014)

Amended and Restated Master Management Agreement, dated as of March 12, 2014, by and between Inland American Real Estate Trust, Inc.

and Inland American Industrial Management LLC (incorporated by reference to Exhibit 10.3 to the Registrant’s Form 8-K, as filed by the Registrant with the Securities and Exchange Commission on March 13, 2014)

Articles of Association of Oak Real Estate Association by and among Inland Real Estate Corporation, Inland Real Estate Trust, Inc., Inland Western Retail Real Estate Trust, Inc.

and Inland American Real Estate Trust, Inc., dated September 29, 2006 (incorporated by reference to Exhibit 10.139 to the Registrant’s Quarterly Report on Form 10-Q, as filed by the Registrant with the SEC on November 7, 2006)

Operating Agreement of Oak Property and Casualty L.L.C.

by and among Inland Real Estate Corporation, Inland Retail Real Estate Trust, Inc., Inland Western Retail Real Estate Trust, Inc.

and Inland American Real Estate Trust, Inc, dated September 29, 2006 (incorporated by reference to Exhibit 10.140 to the Registrant’s Quarterly Report on Form 10-Q, as filed by the Registrant with the SEC on November 7, 2006)

Oak Property and Casualty L.L.C.

Membership Participation Agreement by and among Inland Real Estate Corporation, Inland Retail Real Estate Trust, Inc., Inland Western Retail Real Estate Trust, Inc., Inland American Real Estate Trust, Inc., and Oak Property and Casualty L.L.C.

dated September 29, 2006 (incorporated by reference to Exhibit 10.141 to the Registrant’s Quarterly Report on Form 10-Q, as filed by the Registrant with the SEC on November 7, 2006)

Indemnity Agreement, dated as of August 8, 2014, by and between Inland American Real Estate Trust, Inc., and Xenia Hotels & Resorts, Inc., and Inland American Lodging Group, Inc.

(incorporated by reference to Exhibit 10.1 to the Registrant’s Quarterly Report on Form 10-Q, as filed by the Registrant with the SEC on August 14, 2014)

Separation and Consulting Agreement, dated as of September 6, 2017, between InvenTrust Properties Corp.

Collins (incorporated by reference to Exhibit 10.1 to the Registrant’s Form 8-K, as filed by the Registrant with the SEC on September 7, 2017)

First Amendment to Separation and Consulting Agreement, dated as of December 8, 2017, between InvenTrust Properties Corp.

Collins (incorporated by reference to Exhibit 10.1 to the Registrant’s Form 8-K, as filed by the Registrant with the SEC on December 11, 2017)

Second Amendment to Separation and Consulting Agreement, dated as of October 5, 2018, between InvenTrust Properties Corp.

Collins (incorporated by reference to Exhibit 10.1 to the Registrant’s Form 8-K, as filed by the Registrant with the SEC on October 9, 2018)

Employment Offer Letter, dated as of May 10, 2018, by and between InvenTrust Properties Corp.

and Ivy Greaner

Severance Agreement and General Release, dated as of August 27, 2018, by and between Michael E.

Podboy and InvenTrust Properties Corp.

(incorporated by reference to Exhibit 10.1 to the Registrant’s Form 8-K, as filed by the Registrant with the SEC on August 27, 2018)

Employment Offer Letter, dated as of June 20, 2019, by and between InvenTrust Properties Corp.

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Busch (incorporated by reference to Exhibit 10.2 to the Registrant’s Form 10-Q as filed by the Registrant on August 8, 2019)

Asset Purchase Agreement, dated as of September 17, 2014, by and among Inland American Real Estate Trust, Inc., IHP I Owner JV, LLC, IHP West Homestead (PA) Owner LLC and Northstar Realty Finance Corp.

(incorporated by reference to Exhibit 10.1 to the Registrant’s Form 8-K, as filed by the Registrant with the SEC on September 22, 2014)

InvenTrust Properties Corp.

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InvenTrust Properties Corp.

Director Compensation Program, effective as of May 5, 2022

Director Compensation Program, effective as of May 5, 2022 (incorporated by reference to Exhibit 10.18 to the Registrant’s Form 10-K, as filed by the Registrant with the SEC on February 21, 2023)

InvenTrust Properties Corp.

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First Amendment, dated as of September 22, 2021, to Amended and Restated Term Loan Credit Agreement, among InvenTrust Properties Corp., Wells Fargo Bank, National Association and the other lenders party thereto (incorporated by reference to Exhibit 10.1 to the Registrant’s Form 8-K, as filed by the Registrant with the SEC on September 22, 2021)

Second Amendment, dated as of May 11, 2022, to Amended and Restated Term Loan Credit Agreement, among InvenTrust Properties Corp., the lenders party thereto and Wells Fargo Bank, National Association

Second Amended and Restated Credit Agreement dated as of December 21, 2018, among InvenTrust Properties Corp., as borrower, KeyBank National Association, as Administrative Agent, KeyBanc Capital Markets Inc.

1 unchanged sentence

First Amendment, dated as of September 22, 2021, to Second Amended and Restated Credit Agreement, among InvenTrust Properties Corp., KeyBank, National Association and the other lenders party thereto (incorporated by reference to Exhibit 10.2 to the Registrant's Form 8-K, as filed by the Registrant with the SEC on September 22, 2021)

Second Amendment dated as of May 11, 2022 to Second Amended and Restated Credit Agreement, among InvenTrust Properties Corp., the lenders party thereto and KeyBank National Association

Form of Director Restricted Stock Unit Agreement for Annual Awards (incorporated by reference to Exhibit 10.1 to the Registrant’s Form 10-Q, as filed by the Registrant with the SEC on August 7, 2020)

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and the purchasers named therein (incorporated by reference to Exhibit 10.1 to the Registrant’s Form 8-K, as filed by the Registrant with the SEC on June 3, 2022)

InvenTrust Properties Corp.

2023 Employee Stock Purchase Plan (incorporated by reference to Exhibit 10.1 to the Company’s Form 10-Q, as filed by the Company with the SEC on August 1, 2023)

Subsidiaries of the Registrant

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Certification by Principal Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

InvenTrust Properties Corp.

Policy for Recovery of Erroneously Awarded Compensation

101 The following financial information from our Annual Report for the year ended December 31, 2023, filed with the Securities and Exchange Commission on February 14, 2024, is formatted in Extensible Business Reporting Language ("XBRL"):

(i) Consolidated Balance Sheets, (ii) Consolidated Statements of Operations and Comprehensive Income (Loss), (iii) Consolidated Statements of Equity, (iv) Consolidated Statements of Cash Flows (v) Notes to Consolidated Financial Statements (tagged as blocks of text).

(i) Consolidated Balance Sheets, (ii) Consolidated Statements of Operations and Comprehensive (Loss) Income, (iii) Consolidated Statements of Equity, (iv) Consolidated Statements of Cash Flows (v) Notes to Consolidated Financial Statements (tagged as blocks of text).

104 Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)

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Consolidated Balance Sheets as of December 31, 202 3 and 20 2 2

Consolidated Statements of Operations and Comprehensive Income (Loss) for the years ended December 31, 2022, 2021 and 2020

Consolidated Statements of Operations and Comprehensive (Loss) Income for the years ended December 31, 2023, 2022 and 2021

Consolidated Statements of Equity for the years ended December 31, 202 3 , 202 2 and 202 1

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We have audited the accompanying consolidated balance sheets of InvenTrust Properties Corp.

and subsidiaries (the Company) as of December 31, 2022 and 2021, the related consolidated statements of operations and comprehensive income (loss), equity, and cash flows for each of the years in the three-year period ended December 31, 2022, and the related notes and financial statement schedule III (collectively, the consolidated financial statements).

and subsidiaries (the Company) as of December 31, 2023 and 2022, the related consolidated statements of operations and comprehensive (loss) income, equity, and cash flows for each of the years in the three-year period ended December 31, 2023, and the related notes and financial statement schedule III (collectively, the consolidated financial statements).

In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2023 and 2022, and the results of its operations and its cash flows for each of the years in the three‑year period ended December 31, 2023, in conformity with U.S.

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(1) relates to accounts or disclosures that are material to the consolidated financial statements and (2) involved our especially challenging, subjective, or complex judgments.

The communication of a critical audit matter does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.

The communication of a critical audit matter does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing separate opinions on the critical audit matter or on the accounts or disclosures to which it relates.

Expected hold period of investment properties

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In our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2023, based on criteria established in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated balance sheets of the Company as of December 31, 2022 and 2021, the related consolidated statements of operations and comprehensive income (loss), equity, and cash flows for each of the years in the three-year period ended December 31, 2022, and the related notes and financial statement schedule III (collectively, the consolidated financial statements), and our report dated February 21, 2023 expressed an unqualified opinion on those consolidated financial statements.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated balance sheets of the Company as of December 31, 2023 and 2022, the related consolidated statements of operations and comprehensive (loss) income, equity, and cash flows for each of the years in the three-year period ended December 31, 2023, and the related notes and financial statement schedule III (collectively, the consolidated financial statements), and our report dated February 14, 2024 expressed an unqualified opinion on those consolidated financial statements.

Basis for Opinion

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Distributions in excess of accumulated net income ( 3,932,826 ) ( 3,879,847 )

Accumulated comprehensive income (loss) 26,721 ( 4,322 )

Accumulated comprehensive income 18,074 26,721

Total stockholders' equity 1,554,044 1,603,909

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INVENTRUST PROPERTIES CORP.

Consolidated Statements of Operations and Comprehensive Income (Loss)

Consolidated Statements of Operations and Comprehensive (Loss) Income

(in thousands, except share and per share amounts)

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Total operating expenses 222,868 201,458 209,204

Other income (expense)

Other (expense) income

Interest expense, net ( 38,138 ) ( 26,777 ) ( 16,261 )

Loss on extinguishment of debt ( 15 ) ( 181 ) ( 400 )

Provision for asset impairment — — ( 9,002 )

Gain on sale of investment properties, net 2,691 38,249 1,522

Equity in earnings (losses) of unconsolidated entities 3,663 6,398 ( 3,141 )

Equity in (losses) earnings of unconsolidated entities ( 557 ) 3,663 6,398

Other income and expense, net 5,480 2,030 606

Total other income (expense), net 16,984 ( 8,135 ) ( 28,357 )

Total other (expense) income, net ( 30,539 ) 16,984 ( 8,135 )

Net income (loss) $ 5,269 $ 52,233 $ ( 5,360 )

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Distributions paid per common share outstanding $ 0.85 $ 0.82 $ 0.78

Comprehensive income (loss)

Comprehensive (loss) income

Net income (loss) $ 5,269 $ 52,233 $ ( 5,360 )

Unrealized gain (loss) on derivatives 32,052 3,795 ( 16,199 )

Unrealized gain on derivatives 6,228 32,052 3,795

Reclassification (to) from net income (loss) ( 14,875 ) ( 1,009 ) 4,332

Comprehensive income (loss) $ 83,276 $ 2,767 $ ( 23,680 )

Comprehensive (loss) income $ ( 3,378 ) $ 83,276 $ 2,767

See accompanying notes to the consolidated financial statements.

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Repurchase of common stock under share repurchase plan ( 755,643 ) ( 7 ) ( 16,678 ) — — ( 16,685 )

Common stock issuance costs in excess of proceeds

from distribution reinvestment plan 7,904 — ( 93 ) — — ( 93 )

Repurchase of common stock through tender offer ( 4,000,000 ) ( 4 ) ( 103,327 ) — — ( 103,331 )

Ending balance, December 31, 2021 67,344,374 67 5,452,550 ( 3,876,743 ) ( 4,322 ) 1,571,552

Net loss — — — ( 5,360 ) — ( 5,360 )

Net income — — — 52,233 — 52,233

Unrealized gain on derivatives — — — — 32,052 32,052

Reclassification to interest expense, net — — — — 4,198 4,198

Reclassification to equity in earnings of unconsolidated entities — — — — 134 134

Reclassification from interest expense, net — — — — ( 405 ) ( 405 )

Reclassification from equity in earnings of unconsolidated entities — — — — ( 604 ) ( 604 )

Distributions declared — — — ( 55,337 ) — ( 55,337 )

Stock-based compensation, net 128,179 — 4,418 — — 4,418

Repurchase of common stock under share repurchase plan ( 755,643 ) ( 7 ) ( 16,678 ) — — ( 16,685 )

Repurchase of common stock through tender offer ( 4,000,000 ) ( 4 ) ( 103,327 ) — — ( 103,331 )

Ending balance, December 31, 2022 67,472,553 67 5,456,968 ( 3,879,847 ) 26,721 1,603,909

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Reclassification from interest expense, net — — — — ( 14,875 ) ( 14,875 )

Reclassification from equity in earnings of unconsolidated entities — — — — ( 604 ) ( 604 )

Distributions declared — — — ( 58,248 ) — ( 58,248 )

Stock-based compensation, net 127,238 1 7,427 — — 7,428

Issuance of common stock, net 208,040 — 4,333 — — 4,333

Ending balance, December 31, 2023 67,807,831 $ 68 $ 5,468,728 $ ( 3,932,826 ) $ 18,074 $ 1,554,044

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Straight-line rent adjustment, net ( 3,464 ) ( 2,645 ) ( 3,272 )

Provision for asset impairment — — 9,002

(Reversal of) provision for estimated credit losses ( 1,437 ) 2,271 11,119

Provision for (reversal of) estimated credit losses 1,148 ( 1,437 ) 2,271

Gain on sale of investment properties, net ( 2,691 ) ( 38,249 ) ( 1,522 )

Loss on extinguishment of debt 15 181 400

Equity in (earnings) losses of unconsolidated entities ( 3,663 ) ( 6,398 ) 3,141

Equity in losses (earnings) of unconsolidated entities 557 ( 3,663 ) ( 6,398 )

Distributions from unconsolidated entities — 9,350 8,085

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Payment of tax withholdings for share-based compensation ( 1,583 ) ( 1,581 ) ( 1,833 )

Repurchase of common stock under share repurchase plan — ( 16,685 ) ( 5,201 )

Repurchase of common stock through tender offer — ( 103,331 ) —

Proceeds from distribution reinvestment plan — — 185

Repurchases of common stock — — ( 116,397 )

Payment of common stock repurchase costs — — ( 3,619 )

Proceeds from sale of common stock under ATM 5,165 — —

Proceeds from sale of common stock under ESPP 235 — —

Payment of common stock offering costs ( 341 ) — —

Distributions to stockholders ( 57,491 ) ( 55,302 ) ( 55,561 )

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Payoffs of debt ( 33,700 ) ( 47,052 ) ( 50,000 )

Debt prepayment penalties — — ( 2,504 )

Principal payments on mortgage debt ( 32 ) ( 842 ) ( 1,306 )

1 unchanged sentence

Other financing activities 20 ( 262 ) ( 390 )

Net cash provided by (used in) financing activities 111,574 ( 204,171 ) ( 82,073 )

Net cash (used in) provided by financing activities ( 87,902 ) 111,574 ( 204,171 )

Net decrease in cash, cash equivalents and restricted cash ( 37,999 ) 92,908 ( 178,916 )

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Cash paid for interest, net of capitalized interest $ 33,093 $ 18,705 $ 14,570

Cash (refunded) paid for income taxes, net of (payments) refunds ( 386 ) 276 833

Cash paid (refunded) for income taxes, net of (payments) refunds 209 ( 386 ) 276

Previously held equity investments in real estate assets acquired 39,603 — —

Distributions payable to stockholders 14,594 13,837 13,802

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Gross issuance of shares for share-based compensation 4,558 6,224 5,040

Reclassification of registration statement costs incurred to equity issuance costs — — 278

Purchase of investment properties:

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On October 4, 2004, InvenTrust Properties Corp.

(the "Company" or "InvenTrust") was incorporated as Inland American Real Estate Trust, Inc., a Maryland corporation, and has elected and operates in a manner to be taxed as a real estate investment trust ("REIT") for federal tax purposes.

(the "Company" or "InvenTrust") was incorporated as Inland American Real Estate Trust, Inc., a Maryland corporation, and elected to operate in a manner to be taxed as a real estate investment trust ("REIT") for federal tax purposes.

The Company changed its name to InvenTrust Properties Corp.

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Each retail property is owned by a separate legal entity that maintains its own books and financial records.

Each separate legal entity's assets are not available to satisfy the liabilities of other affiliated entities, except as otherwise disclosed in " Note 6.

Investment in Unconsolidated Entities ".

As of December 31, 2022 and 2021, the Company had an investment in one unconsolidated real estate joint venture, as disclosed in " Note 6.

Investment in Unconsolidated Entities ".

Each separate legal entity's assets are not available to satisfy the liabilities of other affiliated entities.

The Company has a single reportable segment, multi-tenant retail, for disclosure purposes in accordance with United States ("U.S.") generally accepted accounting principles ("GAAP").

1 unchanged sentence

Number of properties and square feet are unaudited.

Reduction of Authorized Shares

On April 28, 2022, the Company filed an amendment to its charter to decrease the number of authorized shares of common stock from 1,460,000,000 to 146,000,000 , in proportion with the one-for-ten reverse stock split effected on August 5, 2021.

The authorized shares of preferred stock remain at 40,000,000 .

The authorized shares of common stock have been retroactively adjusted within the accompanying consolidated financial statements to give effect to the reduction for all periods presented.

The following table summarizes the Company's retail portfolio as of December 31, 2023 and 2022:

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Changes in collectability occur when the Company no longer believes it is probable that substantially all the lease payments will be collected over the term of the lease.

If collection is not probable, regardless of whether the Company has entered into an amendment to provide the tenant with COVID-19 related rent relief, the lease payments will be accounted for on a cash basis, and revenue will be recorded as cash is received.

If collection is not probable, the lease payments will be accounted for on a cash basis and revenue will be recorded as cash is received.

If reassessed, and the collection of substantially all of the lease payments from the tenant becomes probable, the accrual basis of revenue recognition is reestablished.

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The Company recognizes other fee income when it satisfies a performance obligation relating to services provided to its joint venture partnership.

The resulting receivables are settled through recurring monthly payments for the services provided over the term of the contract.

The Company generally does not receive prepayments for services or recognize revenue prior to being legally entitled to payment.

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The bundled services of the property management performance obligation and asset management performance obligation each qualify as a series of distinct services satisfied over time.

The variable consideration related to each of the performance obligations is recognized in each of the periods that directly relate to the Company's efforts to provide those services.

Accordingly, the Company elected the optional exemption provided by Topic 606 to not disclose information about remaining wholly unsatisfied performance obligations.

The variability in timing of the property management and asset management fees, which generally relate to the fluctuation in cash receipts from tenants and potential changes in equity capitalization, are resolved on a monthly basis.

For certain services, the Company acts as an agent on behalf of the customer to arrange for performance by a third party.

Based on the Company's judgment, both the underlying asset management service activities and the underlying property management service activities are not distinct but are inputs (or fulfillment activities) to provide the combined output (either the overall asset management service or the overall property management service).

Leasing commissions and other fees are recognized at a point in time consistent with the underlying service rendered to the joint venture partnership.

The leasing performance obligation and other performance obligations are satisfied at the point in which the customer is transferred control over and consumes the benefit of the service.

The uncertainty of the leasing commissions and other fees are resolved upon delivery of the underlying service.

Generally, the first and second installments of leasing commissions are paid upon lease execution and rent commencement, respectively.

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The carrying amounts of cash, cash equivalents and restricted cash, accounts and rents receivables, other assets, accounts payable, accrued expenses, and other liabilities reasonably approximate fair value, in management’s judgment, because of their short-term nature.

Fair value information pertaining to derivative financial instruments, investment properties, investments in unconsolidated entities and debt is provided in "Note 9.

Fair value information pertaining to derivative financial instruments, investment properties, and debt is provided in "Note 9.

Fair Value Measurements" .

The Company has elected and operates in a manner to be taxed as a REIT under the Internal Revenue Code of 1986, as amended (the "Code") for federal income tax purposes commencing with the tax year ended December 31, 2005.

To qualify as a REIT, the Company is generally required to distribute at least 90% of its REIT taxable income (subject to certain adjustments) to its stockholders each year (the "90% Distribution Requirement").

As a REIT, the Company is entitled to a tax deduction for some or all of the dividends paid to stockholders.

Accordingly, the Company generally will not be subject to federal income taxes as long as it currently distributes to stockholders an amount equal to or in excess of the Company's taxable income.

If the Company fails to qualify as a REIT in any taxable year, without the benefit of certain relief provisions, the Company will be subject to federal and state income tax on its taxable income at regular corporate tax rates.

Even if the Company qualifies for taxation as a REIT, the Company may be subject to certain state and local taxes on its income, property or net worth and federal income and excise taxes on its undistributed income.

From time to time, the Company may elect to treat certain of its consolidated subsidiaries as taxable REIT subsidiaries ("TRSs") pursuant to the Code.

Among other activities, TRSs may participate in non-real estate related activities and/or perform non-customary services for tenants and are subject to federal and state income tax at regular corporate tax rates.

Income tax expense or benefit is recognized as a part of other income and expense, net.

During the years ended December 31, 2022 and 2021, the Company did not have any operations within TRSs.

Income tax expense for the years ended December 31, 2022 and 2021 generally pertains to Texas margin tax.

Income tax expense for the year ended December 31, 2020 is generally comprised of federal and state taxes paid by consolidated TRSs and certain state taxes paid by the Company.

Under the federal legislation enacted on March 27, 2020, known as the Coronavirus Aid, Relief, and Economic Security Act (the "CARES Act"), certain limitations on the deductibility of net operating losses ("NOLs") enacted under prior federal tax legislation have been temporarily rolled back.

As a result of the anticipated NOL carryback claims for the Company's TRSs, total additional tax benefits of $ 1,172 were recognized as a part of other income and expense, net during the year ended December 31, 2020.

The Company has accrued no material interest or penalties relating to income taxes.

As of December 31, 2022, the Company's 2021, 2020, and 2019 tax years remain subject to examination by U.S.

and various state tax jurisdictions.

Derivative Instruments

In the normal course of business, the Company is exposed to the effect of interest rate changes.

The Company's objective in using interest rate derivatives is to manage its exposure to interest rate movements and add stability to interest expense.

To accomplish this objective, the Company uses interest rate swaps as part of its interest rate risk management strategy.

Interest rate swaps designated as cash flow hedges involve the receipt of variable rate amounts from a counterparty in exchange for the Company making fixed rate payments over the life of the agreement without exchange of the underlying notional amount.

The Company has a policy of only entering into contracts with established financial institutions based upon their credit ratings and other factors.

When viewed in conjunction with the underlying and offsetting exposure that the derivatives are designed to hedge, the Company has not sustained a material loss from those instruments, nor does it anticipate any material adverse effect on its net income or financial position in the future from the use of derivatives.

The Company recognizes all derivatives on the consolidated balance sheets at fair value.

Additionally, changes in fair value will affect either equity or earnings depending on whether the derivative instruments qualify as a hedge for accounting purposes and, if so, the nature of the hedging activity.

When the underlying transaction is terminated or completed, all changes in the fair value of the instrument are marked-to-market with changes in value included in earnings each period until the instrument matures.

Any derivative instrument used for risk management that does not meet the criteria for hedge accounting is marked-to-market each period in earnings.

The Company does not use derivatives for trading or speculative purposes.

Share-Based Compensation

The Company has one share-based compensation plan under which time-based restricted stock units ("RSUs"), performance-based RSUs, and market-based RSUs have been issued with tandem dividend equivalents.

Stock-Based Compensation Plans

Incentive Award Plan

Effective June 19, 2015, the Company's board of directors (the "Board") adopted the InvenTrust Properties Corp.

2015 Incentive Award Plan (the "Incentive Award Plan"), under which the Company may grant cash and equity incentive awards to eligible employees, directors, and consultants.

The Company has awarded time-based restricted stock units ("RSUs"), performance-based RSUs, and market-based RSUs with tandem dividend equivalents.

Compensation expense related to these awards, which are generally equity classified, is recognized as a part of general and administrative expense.

The tandem dividend equivalent cash payments of awards granted during the year ended December 31, 2022 are recognized within equity.

The tandem dividend equivalent cash payments of awards granted during the years ended December 31, 2021 and 2020 are recognized within earnings.

The tandem dividend equivalent cash payments of awards granted during the years ended December 31, 2023 and 2022 are recognized within equity.

The tandem dividend equivalent cash payments of awards granted during the year ended December 31, 2021 are recognized within earnings.

Forfeitures of awards are recognized as they occur.

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During the service period, a cumulative catch-up approach is used to account for changes in the assessment of which outcome is most likely to occur.

Absent a change in the determination of the most likely outcome, compensation expense related to these awards would be recognized on a straight-line basis from the grant date through the vesting date.

Market-based awards are valued as of the grant date utilizing a Monte Carlo simulation model that assesses the probability of satisfying certain market performance thresholds over a three year performance period.

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The resulting compensation expense is recorded over the service period regardless of whether the TSR performance measures are achieved.

Employee Stock Purchase Plan

Effective May 4, 2023, the Company's Board established an Employee Stock Purchase Plan (the "ESPP") through which employees may purchase shares of the Company's common stock semi-annually at a price equal to 85% of the lesser of:

(a) the closing price per share on the first day of such period, and (b) the closing price per share on the last day of such period.

Compensation expense related to the ESPP is recognized as a part of general and administrative expense.