NOTE 9. SUBSEQUENT EVENTS

Investment Activity

In July 2014, we completed an irrigation upgrade project on East Shelton, for which we rehabilitated several of the 13 existing wells on the property, in addition to adding two new wells. The total cost of this project was approximately $1.2 million.

On July 23, 2014 we acquired one farm comprised of 68 acres of farmland near Oxnard, California, for an aggregate purchase price of approximately $6.9 million. The property is currently being farmed for fruits and vegetables. We funded this acquisition by drawing on our New Line of Credit with MetLife. At closing, we executed an agreement with the existing tenant for a three-year triple-net lease, which provides annualized, GAAP straight-line rents of approximately $330,000. We will account for this acquisition as a business combination in accordance with ASC 805; however, the initial accounting for this transaction is not yet complete, making certain disclosures unavailable at this time.

On July 25, 2014, we acquired one farm comprised of 326 acres of farmland near Arvin, California, for an aggregate purchase price of approximately $5.8 million. The property is currently being farmed for vegetables. We funded this acquisition by drawing on our New Line of Credit with MetLife. At closing, we were assigned the existing triple-net lease, which has 15 months remaining on the term. The lease provides for annualized, GAAP straight-line rents of $58,000. In addition, we also executed a nine-year, follow-on lease with a new tenant that begins at the end of the 15-month lease assumed at acquisition. Under the terms of the follow-on lease, the tenant has one option to extend the lease for an additional three-year term. This nine-year lease will provide for prescribed rent escalations over its life, with annualized, GAAP straight-line rents of approximately $312,000. In addition, this follow-on lease requires us to make certain irrigation improvements to the property, for which we will earn additional rent on the total cost of the improvements, up to a total cost of $750,000, commensurate with the yield on the farmland. We will account for this acquisition as a business combination in accordance with ASC 805; however, the initial accounting for this transaction is not yet complete, making certain disclosures unavailable at this time.

On July 25, 2014, we entered into an agreement of purchase and sale to purchase 64 acres of land in California (the “64-Acre California Property”) for approximately $6.4 million. The 64-Acre California Property is irrigated farmland that is farmed primarily for strawberries. The purchase of the 64-Acre California Property is subject to customary conditions and termination rights for transactions of this type, including a due diligence inspection period, and there can be no assurance that the acquisition will be consummated by a certain time, or at all.

On July 31, 2014, we entered into an agreement of purchase and sale to purchase 825 acres of land that includes a cooling and packing facility in Florida (the “825-Acre Florida Property”) for approximately $14.2 million. The 825-Acre Florida Property is irrigated farmland that is farmed primarily for strawberries. The purchase of the 825-Acre Florida Property is subject to customary conditions and termination rights for transactions of this type, including a due diligence inspection period, and there can be no assurance that the acquisition will be consummated by a certain time, or at all.

Distributions

On July 15, 2014, our Board of Directors declared the following monthly cash distributions to common stockholders: