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Overview For Government and Business For Capital Markets Our Approach to Creating Value

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Overview

Imperium and its affiliates are leaders in real estate development, brokerage, construction management/administration, master planning and building architecture, property management, asset management and business advisory. Imperium has the experience and knowledge needed to meticulously manage budgets and control costs.
Imperium, its affiliates, and employees, throughout their careers, have been responsible for billions of dollars covering millions of square feet in commercial real estate development and construction in North America; among these projects are some of the finest commercial real estate properties including retail, office, multi-family, and master planned commercial developments. Our personnel are entrepreneurs and international business leaders that have come together as a team to seize opportunity and generate profit for our clients.

Every decision Imperium

makes is strategic and must result in more than simply a transactional relationship. meaningful Imperium partnerships seeks with

its clients by understanding their investment vision, interpreting

their needs, listening to their recommendations, and building business opportunity and profitability for them long term.

Stephen Schattner President, Chairman Imperium

Overview

The entitlement process for real estate is lengthy, but when complete, using Imperiums real estate services, results in large profitability multiplesImperium seeks no pre-defined investment life to force artificial timing of a liquidity event leading to decreased profitability potential. Imperium is very selective in what we buy and we are not motivated to place money in investments dictated by fund managers or tax-free exchangesour relatively small investment portfolio allows us to focus on making each investment a success. We believe in what we buythrough mid 2010, principals of Imperium have committed significant equity capital in every deal pursued, so we are owners, not simply managers seeking fees.

Overview

Our real estate investment mission has been to create value through detailed planning and careful execution from early due diligence, to construction, leasing and disposition.
Our investors consider Imperiums due diligence unparalleled in the real estate industry. Imperiums access to off-market information is one of the key elements of our due diligence process. Our professional relationships with government

contractors and officials offer Imperium great insight into regional mobility and planning that is paramount to implementing successful real estate investment strategies.

Confidence and trust underscore our relationships with our clients. Our clients are not only our investors and tenants, but also municipalities, restaurateurs, and merchants for whom we provide business advisory services and tenant representation. With over a decade of experience in the commercial real estate industry, Imperium has grown from a real estate investment advisory company to owner of a premier portfolio of commercial real estate. In only four years, Imperium grew its portfolios asset value by over four times. Imperium started with one investor in 2006 and currently serves 52 high net-worth individuals and private equity institutions. Imperiums investment objective is to create maximum value by developing irreplaceable assets. Imperium is a long-term investor buying undervalued commercial real estate, mostly raw land, building value through entitlement and marketing, and developing and leasing the raw assets it acquires. Our track record in unblemished: over the last decade and into 2010, our organization has grown debt-free. no unanticipated operational capital call has ever been issued to our partners. all assets owned and controlled by Imperium are debt-free. all Imperium assets are well capitalized and no Imperium asset is, or ever has been in distress.

Imperiums mission is to evaluate opportunities, to create value, to exceed our stakeholders expectations, and to ensure the highest standards of project quality through effective, ethical business practices.

Strengths
Access. We have cultivated quality relationships in real estate and government that
enable us to identify and pursue diverse investment opportunities throughout north Texas.

Independence. As a privately held entity, Imperium is free to focus exclusively on our investments rather than responding to shifting corporate priorities. Knowledge. Imperium conducts careful due diligence and makes informed decisions when evaluating investment opportunities. We have an in-depth understanding of the north Texas market and strong, long-term relationships with investors who repeatedly re-invest with us. Continuity. In an era of company acquisitions and management changes, Imperium
is characterized by low turnover, which creates continuity of service and retention of expertise.

Innovation. Imperium continuously evaluates and creates new methods of innovation,


automation and investment structures to meet the growing demands of our partners.

Service. Exceptional availability and clear communication are the hallmarks of Imperium.
We interact regularly with our partners and clients, offering a high level of service and support.

Results. Imperiums experience and passion for success is what stands our company out from other real estate developers and investors. We are committed to identifying and selecting superior investment opportunities while achieving the best potential results.
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Overview

Services
Imperium is a vertically integrated real estate investment and development company that offers services in seven business divisions:
Development Real estate brokerage Construction administration/management Architecture Property management Asset management Business advisory services

Experience
Imperium, its affiliates, and employees have significant individual real estate experience with the following product types:
Retail (big box, retail, restaurant and financial) Multi-family (garden and urban residential) Office (corporate, flex, and spec) Specialty projects (government and educational facilities) Hospitality Healthcare (post-acute and medical office) Mixed-use

Expertise
Our expertise includes:
Project management Due diligence and property evaluation Master planning Approval and entitlement Project finance Construction management and administration Marketing, acquisition, sales, leasing Asset and property management Asset dispositions

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Overview

Stable, Accomplished Company


Our investment underwriting process is guided by a senior team with extensive industry experience and tenure at Imperium. Our team is equipped to navigate and adapt quickly to challenges and situations that occur during the investment life cycle. Each transaction receives the attention of one or more of our senior team members, and typically the involvement of Imperiums Chairman and President, Stephen Schattner. While we have had low turnover among senior leadership, Imperium continues to opportunistically add new members to the team and encourage fresh, innovative thinking.

Market Leaders
Imperium recruits the best talent needed to provide services offered to clients. Imperiums leaders have included former international business moguls, high-ranking federal government employees, and executives from leading financial companies.

Experienced Team
As of 2010, Imperium, its affiliates, and employees represent over 73 years of combined individual real estate and other business-related experience with over three billion dollars in design, development or construction in commercial real estate covering over six million square feet. Since 2000, Imperium has completed 20 separate commercial real estate acquisitions, many of which were large-scale commercial real estate projects involving complex assembly transactions and/or public improvement and incentive participation. Our team consistently analyzes a myriad of real estate opportunities choosing from the best alternatives. We provide due diligence resources, structuring expertise, and a network of relationships needed to profitably execute projects and facilitate our clients objectives.

Deal Execution History


Imperium has proven consistently that many of our acquisitions achieve results of gains and appreciation greater than rates of return and appreciation of comparable investment alternatives of equal risk. Imperium has a successful history of business execution that includes complex, multi-tract acquisitions and assembly, capital structuring between public and private entities, and entitlement that has included contentious zoning cases and recovery of flood plain and wetlands areas. Our experience has limited our investors downside risk, while simultaneously increasing our asset values and our partners investment returns. 11

Streamlined Management
Our team relies heavily on information technology and consistently uses it to our advantage thereby reducing the need for deep management. Our team is lean but highly diversified and well-seasoned.

Management Structure
Imperium and its affiliates are all private companies and wholly owned by Stephen Schattner. There are many employees that conduct day-to-day marketing and back-office functions, but almost all individuals who are producers within Imperium share in the ownership of the transactions and receive compensation through performance fees earned in the acquisition, development, leasing, construction, and sales of the assets. As a private company, investment opportunities are identified quickly and investment decisions are made swiftly. The company relies on a team approach for underwriting and marketing; in almost every case, the individual who makes the recommendation to purchase an asset is responsible for the leasing and sales. Through mid 2010, all Imperium producers have been financially committed in our investments; therefore, the entire production team drives to achieve financial success. Imperiums management structure puts producers and employees in positions of empowerment. Imperium has wisely selected its partners and employees and only those who have characteristics of entrepreneurial sprit are selected to work with our team. We communicate seamlessly across divisions in order to achieve only one shared end result: maximum profitability. We all succeed together or we all fail togetherwe are motivated to succeed as a team. 12

Intensive Investment Management


Throughout the development cycle, which includes due diligence, acquisition, entitlement, sales/leasing, development, construction, property management, asset management and investment sales, Imperium is hands-on. Although our fee-based services may be selectively engaged by company division specializing in each aspect of this development cycle, results are often better attained when Imperiums full breadth of services are employed. The full breadth of our services reduces transactional expenses often associated with communication and scheduling third-party consultants to perform services that Imperium is qualified to conduct. Our hands-on approach allows Imperium to communicate with our clients and tenants and deliver to them the desired results for their real estate objectives.

Diversified Expertise
Imperiums team offers a blend of real estate finance, operations, design, development, sales and construction knowledge bringing a range of diversified opinions to evaluate profit enhancement options. Imperium, its affiliates, and employees have extensive experience in sourcing, evaluating, closing, managing and ultimately exiting successful commercial real estate investments, as well as prior operating experience in various roles and responsibilities across multiple industries ranging from restaurant operations, energy and healthcare.

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Overview

Broad Skills
Imperiums team has broad skills in different facets of real estate. Most of our team members are multi-versed in business, architecture, engineering, and construction management. Imperiums team members have education, skills and experience to evaluate investment opportunities quickly that often require constructability forethought, as well as financial analysis, necessary to quantify the improvement impact of the potential investment and the return on the asset; this is often conducted before the acquisition negotiations commence. Because of investment complexity, some opportunities are often overlooked by other investors who lack the value creation expertise and who only seek simple (and usually more expensive, less profitable) options. Imperium offers the advantage of value creation through broad skills.

Internal Capabilities
Speed in accessing and analyzing information is essential for capitalizing on real estate opportunity. Imperium has the ability to evaluate investment opportunities through its internal resources bypassing the need for many outside consultants who, in many situations, slow down the underwriting process, fail to convey critical due diligence information, and increase project costs.

Disciplined Approach
Our disciplined and systematic investment approach evaluates a checklist of factors that are necessary in determining if an investment opportunity meets Imperiums acquisition criteria. Our team analyzes a myriad of opportunities, maintaining a focus on generating superior returns and downside protection. Our financial expectations must meet return profiles that are heavily reliant on speculative and uncertain timing. This requires a thorough understanding for market supply/demand economics, growth projections, community willingness, and macroeconomics that all may influence the outcome and performance of our investments. The evaluation of this information is just a portion of our disciplined approach.

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Overview

Our Network Works for You


Imperium provides expert resources from within our firm and from its network of third-party advisors and consultants. Our network of pre-qualified consultants is often used to recheck our data and offer different project approaches that help us deliver profitable real estate development solutions in the least amount of time and at the least cost. Since 2000, Imperium has developed an expansive network and close working ties with equity sponsors, company executives, lenders, counsel, consultants, accountants, brokers, and investment bankers. These relationships have provided Imperium with a steady source of real estate investment opportunities and have enabled us to open doors for our clients.

Access to Capital
Funding for development and real estate investment projects is provided by a large number of investors including major banks, funds, insurance companies, foundations, high net worth individuals, wealth managers, and family offices. Imperium has built strong relationships with private equity sponsors through its long, successful track record of real estate and business investments.

Innovative Solutions
Our investments are long term but our use of technology helps to shorten the duration by enhancing liquidity. Our resources, technology platform, and investment structure enable us to respond to market issues and weather changing market conditions thereby capitalizing on new opportunities that benefit our investors.

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Proprietary Technology
Imperiums proprietary technology drives investment decisions but does not replace the intuition of our principals.
Imperium has developed technology to robustly evaluate and manage 10,000+ financial and construction data inputs that are used in assessing development projects. Our financial evaluations are considered to be the most highly detailed in the development industry and allow us to control and consider costs in the pre-acquisition phase that are often overlooked by other investors or developers. Additionally, Imperium has developed technology to maintain primarily off-market commercial real estate investment opportunities in a proprietary database overlaid with geographical information systems and mapping. Imperium currently tracks 2,600+ commercial real estate properties using this proprietary software. We can sort and assess in seconds the best investment opportunities across thousands of alternatives and evaluate side-by-side comparisons of quantitative and qualitative data. During economic downturns, it is difficult to attain an adequate sample base of information necessary to gain a true representation of current market value. Again, Imperiums proprietary database of property information is used to find and compare better representations of real estate valuation based on thousands of current comparables. Once an asset is acquired, Imperium commences the sales and marketing campaign to 5,000+ regional and national commercial users and investors that operate in the north Texas region. This is conducted using Imperiums proprietary client relationship management software. Reports are generated every 90 days to Imperium investors demonstrating the progress of the Imperium 12-stage sales pipeline of each asset. Investors benefit from the use of Imperiums proprietary technology used for site selection, underwriting, and sales. Our technology offers investors an ability to make informed real estate investment decisions and invest with confidence. 16

For Government and Business

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Imperium represents select businesses and municipalities where their desired growth objectives can be supplemented with Imperiums vertical real estate solutions. Imperium often performs functions that empower and enable management teams to focus on administrating their core business while Imperium manages the details of their expansion plans.
Imperiums functions often include negotiating with lenders, sourcing equity, and building the business plan and financial models needed to identify and communicate our clients expansion needs. It also includes identifying capitalization partners, negotiating terms, performing due diligence, finalizing transaction documents and integrating business planning with execution and project management. During this process,

Imperium assists with building and strengthening management teams for companies, or in situations of public real estate advisory services, aligns municipalities with consultants and strategic partners that are capable of achieving objectives without hassle.

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Seamless Transitions
Long before a deal closes, Imperium and its recommended team of third-party consultants craft a 360-degree evaluation of needed operations, finance, information technology, tax, legal, human resources, and other disciplines needed for a business to make the growth transition. Imperiums services include planning strategies used to demonstrate our clients operational stability and growth viability to capital sources. Imperiums consulting objective is to provide our clients with a seamless growth transition with less disruption in their day-to-day activities

Operational Excellence
Imperium offers strategic business oversight to our represented clients. Each of our clients has different objectives, and in some cases, requires limited or no involvement from Imperium in the day-to-day activities of their on-going business. Imperiums consulting objective is to work in a strategic, broad-based, advisory support role, but Imperium neither mandates resolutions nor makes day-to-day decisions in our clients business affairs.

Depth of Knowledge and Relative Experience


Imperiums vertically integrated team of real estate and business professionals has diverse experience that offers our clients a much faster path to profitable business solutions. Imperium aids our clients when maneuvering through unfamiliar complexities of growth, such as real estate site selection, capitalization structures, lending negotiations and business planning. Imperium offers recommendations to our clients for strategic guidance, but our clients, who are well-established business owners and municipalities, have entire control of their destiny. Our role is only to help guide and assist them in achieving their vision using experienced resources within our office.

Enhancing Business Resources


Imperiums consulting objectives are to work as an extension of our clients teams. Imperium provides clear recommendations with alternative solutions when consulting our clients. Leveraging Imperiums technical experience of real estate, business strategy, and finance offers our clients a path to clear reasoning and is necessary when making informed decisions. Our work as a venture partner or fee-service consultant allows companies and municipalities to outsource resource-intensive activities that are not a part of their day-to-day functions.

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For Government and Business

Responsive, Direct
Imperium is known for our responsive and direct approach with investors and clients. Time is money and talk is cheap. We are not interested in telling people what they want to hear; it is important they know the facts and have adequate information to make informed decisions in a timely manner. Our reputation is built on honesty and reliability but with a no-nonsense, factual approach.

Flexible, Focused
Social conditions, consumer behavior and municipal objectives change in any marketplace requiring Imperium to remain flexible and plan for endless permutations of contingencies. This requires Imperiums diverse expertise and experience needed to uncover opportunity, adapt to changing market conditions, and reap the rewards of value creation. Imperiums vertical integration offers diverse capabilities needed to adapt to dynamic situations that arise throughout an assets development and investment cycle. Imperiums focus never waivers from seeking maximum profitability. Imperiums enterprise of services offers clients enhanced profitability through our lower cost structures and speed to market.

Speed, Delivery
In real estate, time kills all deals. Imperium uncovers options, makes recommendations, and executes decisions quickly, all of which offers more time to evaluate various project alternatives and select the best financial options. Imperium has historically provided municipal fast-track services that has included needs assessments, concept use analysis, concept plan, site plan, lease plan, phasing plan, market analysis, construction cost budget, financial return and analysis, inside team selection, consultant interview and selection, project coordination meetings, financial risk and bonding capacity assessment of the municipality, option analysis, and lender solicitation, and Imperium has successfully delivered this all-encompassing list of services in under 60 days. 20

For Government and Business

Municipal Consulting Process


Imperium provides municipalities with real estate advisory services needed to extract value from city-owned assets. Our line of vertical real estate services make it ideal for communities to contract with Imperium; it simplifies the contract administration of multiple services into one agreement, and more importantly, offers a community a single source of contact throughout the development of their asset. The following is a general description of our two-phase project approach for municipal fee-services development. Each project is uniquely different, so steps used in this phased approach change depending on the project, requirements indicated by our clients, and the needs of the community:

PHASE I
Hourly services contract executed Due Diligence
Evaluate and select team management Asses market and area competition Evaluate supply/demand Identify competitive location advantages Identify and quantify operational improvements Re-verify objectives

Strategic Development
Develop executable and profitable business plan Create market strategies Establish partnership/partnering strategies Initial coordination meeting

30-day Plan
Define objectives and goals Review city ordinances Determine building and greenscape program Stakeholder identification Develop strategic planning session schedule Create buy-in Manage the planning session and schedule and administer municipality-sponsored economic planning session with key business leaders Meetings with constituents and municipal stakeholders Examples of similar projects Generic building massing studies Needs analysis Public, private, public-private options and explanation EDC structure options non-profit, 4-A, 4-B, etc. Preliminary technical review Risk assessment Quantify goals during the initial 6 to 12 months Recommendations and implementation plan

60-day Plan
Locations and size of general building foot prints Locations and size of generic plazas, parks, and open spaces Preliminary parking analysis and solutions Locations and general size of parking area and/or structure Buildable area analysis Evaluate financial options and structure Refine direction Develop alternative plan options Alternative financial return summary Preliminary direction recommended Presentation of initial options

90-day Plan
Urban plan impact/integration Pedestrian connectivity and zones Vehicle connectivity and zones Location of major gateways Locations and general size of generic plazas, parks, and open spaces Locations and general size of parking area and/or structures Preliminary off-site parking analysis and solutions Project phasing and implementation Overall architectural character through case studies and sketches Case studies of similar urban environments and master plans Preliminary cost evaluation Alternative option comparison Land acquisition plan Evaluate combination of public-private sources of capital and noncapital financing; credit enhancement; operational options that reduce land and building development costs/enhance cash flow; federal, state and county involvement options Finical projection; NPV / IRR evaluation Meet with citys lead bonding authority and/or insurer as requested Bonding capabilities (estimated) Recommendation and implementation timelines and schedules Financial structure Project evaluation versus existing options/alternative options Provide final business direction recommendations Final report due

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PHASE II
Implementation Contract Executed Implementation
Project conceptualization Establish project objectives Create the project vision Complete development market analysis Develop land, building, and infrastructure program Complete concept site design Prepare development budget and schedule Complete financial analysis Prepare development phasing plan Develop alternative public/private finance plans Alternative ownership, investment, development and operation scenarios Develop public/private financing structure Create marketing plan Non-disclosures signed; complete solicitation process (RFI/RFQ/RFP) Consultant and/or contractor selection Sole-source method Three-step RFI/FFQ/RFP process Two-step RFQ/RFP process Single-step RFP process Prequalified RFP process RFQ/negotiate method Negotiate contract agreements Initiate sales and leasing as indicated in marketing plan Construction commencement, value engineering, oversight

Operational Excellence Program


Lead monthly asset review Top line improvement program (sales force assignment, competitive pricing evaluation) Cost reduction program Working and operational capital reduction program

Optimize Exit
Operating income enhancement Recapitalization options Disposition strategies Marketing initiatives

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Imperium aligns with and represents clients who have a sound business objective, experience, profitable business history, and a clear and realistic understanding of their development and business goals. Our services result in clear, concise paths to fulfilling strategic objectives with total transparency, team building, and most importantly, constructed assets consistent with the designed intent.
Imperium focuses on providing advisory services to select municipalities and growing commercial businesses that have:
An established market position A clear growth perspective A need to pursue capitalization to accelerate growth An ability to demonstrate commitment in daily

management

Transparency in every respect

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For Government and Business

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For Capital Markets

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Imperium seeks investments in areas where there is an absence of acquisition competition and in markets that will experience substantial residential growth over a five to ten year period. This is typically reminiscent of green markets on the outskirts of major metropolitan regions that are located within 30 to 45 minutes of downtown areas.
These growth markets allow Imperium to capitalize on low cost of entry, low cost to maintain (agricultural exemption), and significant upside potential as communities begin to develop outward and demand for commercial services grows.

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Investing for Growth


Imperium selectively chooses investment opportunities based on the following criteria: Access to proprietary information that only Imperium has that will lead to better investment decisions and enhanced profitability for our clients An areas robust growth rate and potential for further residential expansion justifying commercial development in the immediate future Aggressive and professional municipal management that is eager to provide economic incentives and drive new business to their community Buy undervalued assets that can offer ample exit opportunities, provide sizable returns to investors and clients, and execute with little downside risk Opportunities for significant increase in value over a long term period through the use of Imperiums entitlement and marketing expertise Ability to capture multiple investment locations in a single growth market and create oligopoly conditions

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For Capital Markets

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For Capital Markets

Strategic Guidance
Imperium works closely with its clients to implement strategic investment initiatives directed at increasing the underlying asset value through Imperiums entitlement, marketing and acquisition expertise. Imperium identifies strategies necessary to sustain and accelerate growth and implements these strategies via local municipal, economic development and chamber of commence alliances in each market where the real estate asset is located. Imperium defines the market, identifies customer opportunities, provides services necessary to close each transaction, and in some cases, offers riskadjusted capital resources in business ventures.

Incentives Aligned
Over the last decade, investors have experienced an era of corporate greed, often resulting in their financial loss. In most examples of corporate greed, opulence and exorbitant executive salaries are the main headline, but all instances have one common thread: expropriation of shareholder equity. Corporate mentality has embraced gaming theory: with every winner there has to be a loser, regardless if the loser is the investor. Imperium realizes that many people today have fewer investment opportunities where the investors interests, and not the promoters interests, are served first; this is why Imperium takes no asset management fees or property management fees while any asset under Imperium management or ownership is in non-income production (e.g., raw land investment.) Additionally, Imperium takes no fund management fees. Imperium is paid only if value is being added, the asset is generating income or if the investment transacts. Imperiums investor first approach represents a truly aligned interest between investor and Imperium.

Align with Strategic Objectives


Investors diversification and strategic goals are never constant, and with age, often require less investment risk, reliable income streams, and value enhancement for bequeathing assets and investments to heirs. Imperium offers opportunities in long-term growth and semi-fixed income assets, all with substantial upside in value. In any investment situation, Imperium seeks low or no debt exposure with initial capitalization to cover multi-year operational and entitlement costs. This capitalization structure allows value to be attained over time without the threat of looming creditors.

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Growth Opportunities
Our land investment philosophy is to target hard corner locations at major thoroughfares where other corners are functionally impaired making one corner, our acquired corner, stand out from the other three. We seek to purchase multiple sites in a market where the locations are strategic for future grocery stores or home improvement centers as the major anchor. Additionally, we seek to retain the balance of the property to develop multi-tenant retail or offer ground leases or build-to-suits to drug stores, banks and convenience stores. We seek unlevered investments that have the ability to grow by at least two and a half times within five years and continue to grow thereafter.

Quality Assets
Our investment strategy concentrates only on undervalued real estate strategically located in emerging growth markets. We seek irreplaceable properties such as hard corners at major intersections on major interstate highways, US highways, or farm-to-market roads. As of 2010, every asset Imperium owns or controls is a hard corner on a major thoroughfare in a major growth community in north Texas. All of our assets have some form of significant barrier to entry from competing commercial developments. Our land investments continue to rise in value despite troughs in market conditions since all assets acquired in prior years were purchased well below market value and all assets have undergone some form of value-enhanced entitlement that have increased our properties value and quality.

Asset Value Enhancement


Imperium creates and enhances value by acquiring quality income producing assets at substantial discounts to replacement cost. We then apply the expertise of our team to execute well defined strategies such as property improvements, upgrades, operational improvements or strengthened marketing efforts. 30

Tolerance for Complexity


Imperium looks for investments that can be acquired at attractive prices, often as a result of an assets structural complexity, distress, or disfavor within the capital markets. Many of the best investments that Imperium has made were difficult transactions where Imperiums entitlement expertise combined with scarcity of alternative development locations made our selected site the best choice for tenants and buyers. Our clients and investors share in our vision of seeking added value investment opportunities, who entrust our capabilities, and who have tolerance for deal complexity. 31

For Capital Markets

Patient, Prudent
Real estate investment requires patience and prudence. Real estate is opportunistic and historical buying opportunities occur in 15- to 20-year cycles. However, Imperium has successfully purchased real estate in the heights of real estate booms because distressed opportunities do not only occur in troubling economic times. These opportunities are scarce because they are not widely advertised, but because Imperium monitors and maintains proprietary information and access to over 2,600+ real estate owners, and because our capital sources are patient and prudent, Imperium can move quickly and select from the best investment opportunities regardless of the economic condition. Imperiums proprietary technology offers investors access to information knowing that targeted investments are competitive to the remaining submarket. Imperium patiently waits for the right opportunity at a value well below market; this may involve negotiating for months and even years with sellers as their motivation changes.

Ideal Investment Partners Sought


Imperium seeks the right investment partner who is dedicated to long term relationships with us across multiple transactions. Imperium always seeks better information, better strategic direction, better asset value, and better operational and strategic skills; we often do this by collaborating and listening to expert guidance provided from individuals who are our partners. Imperium seeks the advice of our expansive network of investors who are world-class business managers and owners and who are always ready to provide recommendations, support and counsel. Imperium seeks potential investment partners who have: Diverse experience in business, finance, and sales who can offer investment, sales, or operational recommendations in pursuit of maximum profitability Access to information that may be beneficial in our investment, disposition and leasing decisions Understanding and appreciation for detail and who challenge Imperium in our underwriting and management of the assets Means and desire to maintain open communication

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For Capital Markets

An Ideal Partner
We are patient investors and we seek the same from our partners. We are focused purely on seeking investment opportunities that necessitate a higher level of entitlement and/or marketing expertise in order to extract value this is our specialty. Investment opportunities requiring major entitlement and marketing efforts are often overlooked by other companies because they are incapable of providing certain skills needed to result in substantial value creation. We do not conduct short term trades with large gain expectations; these opportunities are rare and not realistic in real estate investment. We do not use high leverage with our income-producing assets; our investments are long term in nature and must reflect realistic debt coverage ratios if income streams and valuations decline in economic downturns. We do not use leverage on long term land investments simply to earn slightly higher returns; this cannot meet the risk-adjusted return of uncertain liquidity. Imperium is prepared to work through development issues during early phases of our projects life cycles in order to create value. When each development cycle matures, our partnerships will be ready to deliver each of the entitled assets to the buying entity. We seek partners who understand the long term nature of real estate investing.

Personal Relationships
Imperium constantly seeks new equity as our business continues to grow. The success of our business expansion has been derived from the financial transparency of our activities and taking personal approaches when fostering our business relationships. Additionally, our partner relationships have carried over to other investment and business development opportunities, and through our introductions, have led many of our investors to furthering their own businesses outside of real estate. Our relationships with our investors are personal and we seek to be of assistance when and where needed even when Imperium is not involved in the business transaction.

Exclusive, Preferential Deal Flow


Imperiums first investor has continued to invest in every project our company has undertaken. This is a testimony behind our success and confidence in our companys ability to perform. As each of our investments has grown, so has our investor base. Each new project undertaken has first been offered to our existing partners. Our loyalty to these investors has in turn made Imperium successful over the past several years and the reason why we have grown. Imperium recognizes that it did not get to its success independently of its partners. As our company has grown, and our business management and technology developed, so, too, have the opportunities made available to us.The time in which it takes to evaluate investment opportunities has gone from weeks to just a few hours. This now presents new challenges to sourcing abundant equity, which is why Imperium established Imperium Opportunity Fund I, LP as the investment vehicle behind our acquisitions. As always, our existing partners have access to exclusive and preferential investment opportunities through our Fund. 33

Partnership Flexibility
Imperium is a private company, and as such, has flexibility in the arrangement of any business transaction proposed. Imperium seeks fair, balanced, financially incentivized partnerships and seeks partners with the same interest. There are no pre-established requirements or expectations in the structure of our partnerships as long as common interests are met. In the end, we want everyone to have the opportunity to attain substantial financial success as our partnerships game against the remaining marketplace.

Investment Structure
Imperium serves as the general partner, working with our investors as limited partners. All of Imperiums assets are managed in separate limited partnerships or corporations for enhanced liability protection. The success of our business transactions rely on simple formations that are structured to entice Imperium to succeed and to offer substantial profit to Imperiums partners for their equitable assistance in our long term partnership. Imperium is promoted in the transactions after certain risk-adjusted returns are achieved by the partners. Fees paid to Imperium are paid only in the event of successful milestones being attained. There are no double-promotes at the asset level and at the Fund level.

Liquidity and Capital Solutions Benefiting Strategic Sellers


Strategic sellers achieve success through mutually beneficial partnerships with Imperium. Strategic sellers come to us with a variety of objectives, such as increasing their liquidity, improving their balance sheet, ensuring the stability of their asset in a competing market, or protecting their equity. Imperium has endless solutions that fit the needs of our strategic sellers. These solutions include preserving tax positions through revolving credit agreements, option agreements and partnership agreements that may include capital infusion or assignment of continued operational liabilities until the asset is ready for development. Additionally, our involvement includes entitlement, development, construction, and marketing efforts to help enhance the assets liquidity. Our resources and experience meet these sellers strategic objectives with win-win transactions and positive results. 34

Strategic Partnerships
We seek investors who in turn seek to capitalize on the Imperium brand. Imperium has a long standing philosophy of integrity, reputation, and commitment to communities we serve and those principles extend into all of our partnerships. Doing the right thing means that the business philosophy and culture of Imperiums companies is honest, fair, and financially well structured. Our partners offer guidance, insight and experience that we leverage frequently.

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For Capital Markets

Commitment to Client Service


Each of our investors has unique investment objectives and needs, and Imperium is committed to working with each of them individually in order to provide exceptional client service. Imperiums transparent communication and timely, frequent reporting to our investors, aims to provide them better understanding, insight and familiarity with development and real estate investment activities. Additionally, Imperium offers periodic investor forums that are used to enhance their understanding of real estate and economic conditions that have an impact on their investment decisions.

Fee Services Structure


Some of our clients are municipalities that seek to enhance its tax base and create annuities that are used to retire or reduce the debt burden or taxable rates to its citizens. In many of these situations, these municipalities own land that they seek to develop for commercial purposes. In situations like this, Imperium is sometimes retained to provide real estate advisory services as a consultant whereby the municipality seeks to wholly own and control the asset and collect all income streams from lease revenues. Under a fee-service structure, Imperium provides services as an advisor with no equitable interest. This allows the municipality to maximize the returns on their investment while maintaining total autonomy in the project and controlling the quality that sets the standard for their community. Imperiums role is to provide recommendations, evaluate options, earn the communitys trust, work with private and public financing sources, and provide a clear path that achieves our municipal clients goals of quality and maximum sales tax, ad valorem tax and lease revenue.

Partner Communication is Essential


Imperium has never missed a reporting deadline. Our clients receive communication every 90 days that provides the current status of their investment. Each investor receives a report on the financial position of the asset, marketing activity report indicating current pipeline and sales stage of the project naming all tenant and purchaser prospects that Imperium has touched since the last reporting period and the date of last tenant communication, development activity, and strategy. Imperiums communication schedule is as follows: Capital call notices: As needed Distribution notices: As needed Account statements: Quarterly (within 30 days after quarter-end) Marketing/development report: Quarterly Update letters: As needed Annual reports, K-1s: Annually (within 60 days after year-end) 36

Our Approach to Creating Value

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as of 2010, Imperium has over 2.5 million square feet of projects underway in design and development working as master developer or owner. Imperium draws upon a vast collective knowledge working with a team of best-in-class architecture/engineer professionals and at-risk construction companies.
Throughout the development process, Imperium consults with its team of internal and external partners and professionals, leveraging the collective experience of real estate experts within their respective profession. Imperiums project approach begins with an analysis of potential challenges in order to preemptively identify and effectively eliminate most obstacles before they emerge. It is our detail-oriented approach that helps guide us through the project life cycle and live up to or exceed estimated potential.

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Imperiums vertical integration and real estate diversity enables our team to evaluate real estate quickly, compare against several thousand investment opportunities, remove unfavorable prospects, focus on viable locations, negotiate for acquisition among dozens of assets simultaneously, and choose from the one that offers the best upside potential.
Our direct relationship with 5,000+ merchants, restaurants and commercial service groups operating in north Texas, in addition to our offices constant communication with these groups, enable us to identify trends within the sectors we serve and work as a team to derive business opportunities that we present to investors.

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Our Approach to Creating Value

What tenants generally seek for their real estate needs is what Imperium looks for in our real estate investments. Imperium focuses on building value over the long-term, typically holding investments for five to ten years or more. We seek to invest in assets that are often unique and can benefit from high barriers to entry, future strong and stable cash flows and attractive fundamentals. some investments may be complex bankruptcy proceedings where assets are cross collateralized between the operating company and the real estate entity where one or both entities may be in bankruptcy protection or liquidation. Other investment opportunities may be income-producing assets where significant value can be unlocked and created through balance sheet restructuring, operational improvements, and strategic management. We are value-oriented investors, and we seek opportunities suffering from capital market constraints, financial distress, complexity, or negative market sentiment that are overlooked by other competing investment companies. To secure the best investments, we take a flexible approach to sourcing and structuring investments. We believe that this focused, repeatable process gives us an advantage in pricing, owning, financing, optimizing cash flows and overseeing the management of our investments.
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Our Approach to Creating Value

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Geographically Focused
North Texas offers a diverse economic base that has grown into a recognizable international trade hub with the opening of Alliance Airport in 1989 and Union Pacifics Intermodal Terminal in 2005. Over the last two decades, the areas leaders provided foresight that led to advancements in infrastructure and planning. These were contributing factors leading to disproportional increases in the areas domestic product relative to other major metropolitan statistical areas in the United States. The north Texas market has experienced economic and population expansion, which still continues. Dallas, Ft. Worth and Denton have expanded absorbing rural communities with new residential development residing between the three major metropolitan areas. Human resource demand has created an influx of migrant and illegal workers in the southern US. Demographic shifts have occurred in major metropolitan areas. Housing, near the end of its deemed useful life, has created affordable opportunities for transient labors. The original (now displaced) owners have sought new housing located in planned communities with better school systems, amenities, and larger homes. Generally, this has led many transitioning families to areas of far north Texas, north of Interstate 30. Imperium has a focused interest in north Texas, north of Interstate 30, as far west as Weatherford, Texas and as far east as Greenville, Texas. There are ample, off-market, commercial real estate investment opportunities within this geographically concentrated area. Imperium seeks real estate investments in metropolitan submarkets that are due to experience substantial growth over five to ten years and in locations that can be repositioned and value extracted by means of (just to name a few): Master plan modifications/redirection of the development plan Entitlement of property through governmental approvals (zoning, flood recovery, tree removal, earth work, utility infrastructure) Enhanced marketing operations Enhanced property maintenance operations Liquidation of non-performing/under-performing/non-core components of the overall asset Recapitalization (debt and/or equity) Remodel and re-tenanting of existing lease space Scale economy through expansion and consolidation of adjacent properties

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Value-Added Approach
Imperium enhances investment value through prudent business practices that include continual advancements in underwriting, technology research and development, wider arrays of marketing and sales techniques, talent development, continuing education, information sharing, and maintaining a focused, disciplined investment approach that matches our core competencies. Our competencies are enhanced through repetition and scale economies building on the knowledge base from prior projects and established business relationships. We seek assets that are protected by barriers to entry, are difficult to replicate through development, or can be value-enhanced through services that Imperium provides.

Sound Capital Structures


Since 2000, Imperiums investment discipline has not changed: seek quality assets at the right price and reserve adequate capital resources for ongoing operations. Increasing interest rates and declining real estate values make it difficult for owners to meet lenders debt coverage and loan-to-value ratios, respectively, requiring greater infusions of equity that may be inaccessible. Imperium avoided the 2007-2009 credit crisis in its entirety. Up through mid-2010, Imperium and all of its assets are debt-free and well capitalized. Our focus for the coming years is on the endless stream of opportunities rather than trying to fix credit problems. This offers our investors confidence in the fact that we are not subject to operational distractions relative to credit constraints. Our focus is on the development and operations of the assets we own and seeking new quality investment opportunities at discounted values.

Asset Focus
Imperium has a focused specialty is commercial retail real estate (limited to staple-based consumer product-anchored businesses and multi-tenant lease space) and healthcare (limited to post-acute rehabilitation hospitals and multi-tenant office). Our focus allows us to enhance and improve upon each investment undertaken, which are skills needed to extract the most value from the assets we buy or manage. Imperium has substantial experience in commercial master planning and development of mixed use centers. Mixed use components may include retail (staple goods, service, general merchandise), restaurants, entertainment, hospitality, municipal services, parks and open space, office (garden, specialty, corporate), multifamily (garden, urban, senior), healthcare (acute, post-acute), and high-end, single family homes. However, Imperiums unique expertise involves bringing insight from retailers perspectives, which allow development projects to attain higher concentrations of retail-anchored businesses. Higher concentrations of retail are used to achieve higher sales tax revenues for municipalities, offer additional amenity services to complement and enhance the quality of the remaining asset types within the development, and attain greater synergies within the overall campus that increase unit sales and asset values for all campus businesses. 43

Our Approach to Creating Value

Diversification Strategy
We provide our investors opportunities among diversified assets that include long term land investments and income producing, multi-tenant properties. Imperiums focus is concentrated on land investment ideally suited for grocery store, home improvement, multi-tenant retail, multi-tenant medical office and rehabilitation hospital development. As our land investments mature, they enter into the development cycle, and non-income producing land transitions into an income producing development asset that allows for the investor to reap steady income and capture substantial capital gains. Imperiums diversification is limited to historically outperforming retail and medical asset classes, which, between the two types, offer steady development opportunities in counter-cyclical economies throughout multiple submarkets in the Dallas/Ft. Worth area.

Transaction Size
We have the capability of developing or master developing projects up to $300 million in development value, with most undeveloped land transactions ranging between $2 million and $10 million in cost value and multi-tenant, income producing investments between $1 million and $3 million in initial acquisition value. 44

Our Approach to Creating Value

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Optimize Cash Flows


Imperiums incentive based management structure eliminates fees associated with carry costs for non-income producing assets. Imperium passes on savings to its investors and tenants by limiting cash requirements for managerial operations. Additionally, our architectural and development divisions work together to financially evaluate break-even analyses for site and building systems and value engineer site and building designs that, with this team approach, our assets can achieve greater profitability over the holding period or at the time of sales. Imperiums property management and asset management teams effectively resource third-party labor who are reliable and qualified to maintain our partnerships assets. Our companys attention to detail and hands-on involvement result in incremental operational savings that add up and optimize the cash flows to our investors.

Investment and Services Concentration


Geographic Focus: North Texas Target Acquisition Value: $2 million to $10 million in initial
acquisition value if land; $1 million to $3 million in initial acquisition value if income producing, multi-tenant

Maximum Project Size: $300 million (fully developed) Target Capital Structure: Land: all equity/no debt; Income producing
retail and medical assets: low leverage at 60%-65%

Real Estate Investment Position: Control or position of


meaningful influence

Investment Interest: Value added land opportunities positioned for future retail development requiring substantial entitlement work but purchased at deep discount; multi-tenant, income producing retail and medical office; rehabilitation hospitals; restaurant real estate build-to-suits Services: Real estate advisory services for municipal government;
restaurant and merchant business consultant services and/or passive investment; tenant representation for restaurants and merchants that are #1, #2, or #3 in their respective business segment; architecture master planning, retail and restaurant design; property management; asset management

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Extensive Due Diligence


Imperium employs an intensive, analytical due diligence process leveraging operating and consulting experience to uncover value added opportunities. We regularly draw on information not readily accessible in the marketplace. This includes information from regional transportation managers, cataloguing and maintaining in our proprietary database property information for thousands of investment opportunities, and implementing geographical information systems that helps automate, manage and overlay data inclusive of growth patterns, transportation and thoroughfare plans, zoning, land use plans, flood and aquifer recharge zones, topography, soils and aerial data. These technical tools aid us in quickly assessing the big picture and allow us to seek only those opportunities that offer larger spreads in profitability than most other real estate investment opportunities that may exist. Additionally, the extensive due diligence that Imperium performs prior to an acquisition helps the Imperium sales team to explain the benefit of the investment location to purchasers and tenants. The information collected during due diligence can then be conveyed to potential purchasers and tenants that helps them to quickly understand the benefits of selecting our properties over other market opportunities, which accelerates our sales process.

Accelerate and Minimize Risk Related to Future Realizations


The exit values and timing of real estate investments is uncertain. Our approach to valuation looks at competing assets, the potential growth in the submarket, regional transportation and infrastructure timing, among other factors, that allow us to recognize value and monetize uncertain and future financial objectives.

Maximizing Exit Value


Imperium typically holds investments for as long as five to ten years, sometimes longer, before seeking liquidity. However, holding periods may be altered based on profitable opportunities that arise.

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Our Approach to Creating Value

As part of its pre-investment due diligence, Imperium carefully evaluates likely exit scenarios, including potential strategic buyers, or the possibility of a future refinancing or recapitalization that may achieve an acceptable return. Imperium has demonstrated an ability to enhance value or execute sales in a

manner that maximizes returns, independent of current financial markets. Imperium has achieved profitability or increased valuation with every asset ever owned or currently owned by Imperium or when Imperium has provided real estate advisory services as a third-party consultant. 48

6350 LBJ FREEWAy | SUITE 163 | DALLAS, TExAS 75240 972.385.1907 ( P) | 972.385.4884 ( F) www.imperium-holdings.com
Copyright @ 2010

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