Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 For the transition period from____________to____________ Commission file number: 000-55776 RW HOLDINGS NNN REIT, INC. (Exact name of registrant as specified in its charter) Maryland 47-4156046 FORM 10-Q (Mark One) ý QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended September 30, 2019 OR ¨ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURI ...

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (Mark One) ý QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 30, 2019 OR ¨ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from____________to____________ (Address of principal executive offices) (Zip Code) (855) 742-4862 (Registrant's telephone number, including area c ...

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (Mark One) ý QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 31, 2019 OR ¨ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from____________to____________ Commission file number: 000-55776 RW HOLDINGS NNN REIT, INC. (Exact name of registrant as specified in its charter ...

PART I [Business](index=5&type=section&id=ITEM%201.%20BUSINESS) The company operates as an externally managed REIT, investing in single-tenant commercial properties under long-term net leases to provide stable cash distributions and preserve stockholder capital - The Company operates as an externally managed REIT, primarily investing in single-tenant commercial properties with long-term net leases to creditworthy tenants[13](index=13&type=chunk)[14](index=14&type=chunk)[15](index=15&type=chunk) - The company's primary investment objectives are to provide stockholders with attractive and stable cash distributions and to preserve and return their capital contributions[25](index=25&type=chunk)[28](index=28&type=chunk) - As of December 31, 2018, the portfolio included **24 operating properties**, one parcel of land, a **72.7%** tenant-in-common (TIC) interest in a Santa Clara office property, and a **4.8%** interest in an affiliated REIT (REIT I)[54](index=54&type=chunk)[55](index=55&type=chunk) - In 2018, the company acquired six properties leased to tenants including 3M Company, Cummins Inc., 24 Hour Fitness, Texas Health Resources, Bon Secours Health System, and Costco Wholesale Corporation[56](index=56&type=chunk)[57](index=57&type=chunk)[59](index=59&type=chunk) - The company's borrowing policy intends to utilize up to **50% leverage**, with a charter limit of borrowing up to **50% of tangible assets**, unless an excess is approved by the conflicts committee[44](index=44&type=chunk) Offering Proceeds as of December 31, 2018 | Stock Class | Shares Sold | Gross Proceeds | | :--- | :--- | :--- | | Class C Common Stock | 14,027,968 | $140,507,461 | | Class S Common Stock | 17,588 | $176,604 | [Risk Factors](index=13&type=section&id=ITEM%201A.%20RISK%20FACTORS) The company faces significant risks including limited operating history, reliance on its Advisor, lack of public market for shares, conflicts of interest, and an ongoing SEC investigation - The company has a limited operating history, having commenced its Registered Offering in July 2016, with net real estate investments of **$238.9 million** as of December 31, 2018[81](index=81&type=chunk) - The SEC is conducting a non-public, fact-finding investigation related to the company's advertising and sale of securities, with uncertain duration, scope, and outcome that could have a material adverse effect on the business[89](index=89&type=chunk)[91](index=91&type=chunk) - The offerings are on a "best efforts" basis, meaning there is no guarantee of raising substantial funds, which could limit portfolio diversification and increase risks associated with the performance of a smaller number of properties[83](index=83&type=chunk) - The company is considered a "blind pool" as investors do not have the opportunity to evaluate specific investments before they are made, relying entirely on the Advisor's discretion[85](index=85&type=chunk) - Significant conflicts of interest exist as executive officers and directors are affiliated with the Advisor and other Brix-sponsored programs, which could influence decisions regarding fees, acquisitions, and other strategic actions[123](index=123&type=chunk)[127](index=127&type=chunk) - There is no public market for the company's shares, and the share repurchase program is subject to significant limitations, including funding availability and volume caps (e.g., **2% of aggregate NAV per month**), which restricts stockholder liquidity[148](index=148&type=chunk)[150](index=150&type=chunk) - Failure to maintain qualification as a REIT would subject the company to federal income tax at corporate rates, reducing net earnings available for distribution to stockholders[88](index=88&type=chunk)[207](index=207&type=chunk) [Unresolved Staff Comments](index=38&type=section&id=ITEM%201B.%20UNRESOLVED%20STAFF%20COMMENTS) The company reports no unresolved staff comments from the Securities and Exchange Commission - None[231](index=231&type=chunk) [Properties](index=39&type=section&id=ITEM%202.%20PROPERTIES) As of December 31, 2018, the company's 100% occupied portfolio comprised 24 operating properties and one land parcel, generating $17.4 million in annualized base lease revenue, with additional interests in a TIC and an affiliated REIT Property Portfolio Summary as of December 31, 2018 | Metric | Value | | :--- | :--- | | Total Operating Properties | 24 | | Total Rentable Square Feet | 1,536,684 | | Occupancy | 100% | | Annualized Base Lease Revenue | $17,372,544 | | Investment in Real Property, Net | $222,637,211 | | Mortgage Financing (Principal) | $125,022,937 | - In 2018, the company acquired six operating properties and one parcel of land, with tenants including 3M, Cummins, 24 Hour Fitness, Texas Health Resources, Bon Secours, and Costco[238](index=238&type=chunk)[239](index=239&type=chunk)[241](index=241&type=chunk)[244](index=244&type=chunk)[245](index=245&type=chunk)[246](index=246&type=chunk) - The company's lease expirations are staggered, with **12.1% of square footage** expiring in 2021 and **29.0% in 2022**, and no leases set to expire in 2019 or 2020[236](index=236&type=chunk) - The company holds a **72.7% Tenant-in-Common (TIC) interest** in a Santa Clara office property and an approximate **4.8% interest** in REIT I, an affiliated REIT[253](index=253&type=chunk) - REIT I, an affiliate in which the company holds an investment, announced it is exploring strategic alternatives, including a potential sale of its real estate portfolio, prompting the company to form a special committee to evaluate a potential acquisition of REIT I or its portfolio[259](index=259&type=chunk) [Legal Proceedings](index=42&type=section&id=ITEM%203.%20LEGAL%20PROCEEDINGS) The company is involved in an ongoing, non-public SEC investigation regarding the advertising and sale of its securities, with an uncertain outcome - The SEC is conducting an investigation into the advertising and sale of securities by the Company in connection with its Registered Offering, which is a non-public, fact-finding inquiry, not an allegation of wrongdoing[261](index=261&type=chunk)[676](index=676&type=chunk) [Mine Safety Disclosures](index=42&type=section&id=ITEM%204.%20MINE%20SAFETY%20DISCLOSURES) This item is not applicable to the company - Not applicable[262](index=262&type=chunk) PART II [Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities](index=42&type=section&id=ITEM%205.%20MARKET%20FOR%20REGISTRANT%27S%20COMMON%20EQUITY%2C%20RELATED%20STOCKHOLDER%20MATTERS%20AND%20ISSUER%20PURCHASES%20OF%20EQUITY%20SECURITIES) There is no public market for the company's common stock, with its NAV per share established at $10.16 as of December 31, 2018, and a limited share repurchase program in place - No public market exists for the company's common stock, and there are no current plans to list the shares on a national securities exchange[266](index=266&type=chunk) - On January 11, 2019, the board established an estimated Net Asset Value (NAV) of **$10.16 per share** as of December 31, 2018, based on analysis provided by the independent third-party firm Cushman & Wakefield[268](index=268&type=chunk)[269](index=269&type=chunk) - The company has a share repurchase program, but it is limited, with repurchases capped at **2% of aggregate NAV per month** and **5% per quarter**, and the repurchase price is discounted based on the holding period for shares held less than three years[313](index=313&type=chunk)[319](index=319&type=chunk)[321](index=321&type=chunk) NAV Calculation as of December 31, 2018 | Item | Estimated Value | Per Share NAV | | :--- | :--- | :--- | | Total Assets | $269,524,631 | $20.80 | | Total Liabilities | $136,973,034 | $10.57 | | Preliminary NAV | $132,551,597 | $10.23 | | Subordinated participation fee payable | ($839,050) | ($0.07) | | **Total Estimated Value** | **$131,712,547** | **$10.16** | 2018 Distribution Tax Characterization | Tax Characterization | Per Share Amount | | :--- | :--- | | Ordinary income | $0.0352 (5.5%) | | Non-taxable distribution (Return of Capital) | $0.6683 (94.5%) | | **Total** | **$0.7035** | [Selected Financial Data](index=53&type=section&id=ITEM%206.%20SELECTED%20FINANCIAL%20DATA) Selected financial data for 2015-2018 shows significant growth in total assets and revenues, reaching $252.4 million and $18.0 million respectively in 2018, despite an increased net loss of $1.8 million Selected Balance Sheet Data (in thousands) | | 2018 | 2017 | | :--- | :--- | :--- | | Total real estate investment, net | $238,924 | $149,760 | | Total assets | $252,426 | $157,073 | | Total liabilities | $143,332 | $77,777 | | Total stockholders' equity | $103,093 | $79,250 | Selected Operating and Cash Flow Data (in thousands) | | 2018 | 2017 | | :--- | :--- | :--- | | Total revenues | $17,985 | $7,390 | | Net loss | ($1,802) | ($868) | | Cash flows provided by operations | $5,882 | $3,791 | | Net loss per common share | ($0.16) | ($0.15) | [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=53&type=section&id=ITEM%207.%20MANAGEMENT%27S%20DISCUSSION%20AND%20ANALYSIS%20OF%20FINANCIAL%20CONDITION%20AND%20RESULTS%20OF%20OPERATIONS) The company's 2018 financial performance reflects significant portfolio growth, with revenues increasing to $18.0 million, though expenses also rose, resulting in a net loss of $1.8 million - The company is considered a perpetual-life investment vehicle with no finite liquidation date and intends to conduct continuous offerings of its common stock[335](index=335&type=chunk) - Rental income increased by **140% to $14.7 million** in 2018 from $6.1 million in 2017, driven by property acquisitions during 2017 and 2018[366](index=366&type=chunk) - Interest expense increased by **241% to $5.6 million** in 2018, reflecting a rise in the average principal balance of mortgage notes payable to approximately **$90.4 million** from $30.3 million in 2017[372](index=372&type=chunk) - As of December 31, 2018, the company had an outstanding principal balance of **$125.0 million** in mortgage notes and **$9.0 million** on its unsecured revolving credit facility[348](index=348&type=chunk) - The company's portfolio grew from **18 operating properties** at year-end 2017 to **24** at year-end 2018, with total leasable square feet nearly doubling from **785,179 to 1,536,684**[382](index=382&type=chunk) Cash Flow Summary (Year Ended Dec 31) | (in thousands) | 2018 | 2017 | | :--- | :--- | :--- | | Net cash provided by operating activities | $5,882 | $3,791 | | Net cash used in investing activities | ($92,020) | ($115,594) | | Net cash provided by financing activities | $90,711 | $112,308 | [Quantitative and Qualitative Disclosures About Market Risk](index=65&type=section&id=ITEM%207A.%20QUANTITATIVE%20AND%20QUALITATIVE%20DISCLOSURES%20ABOUT%20MARKET%20RISK) This section is not applicable as the company qualifies as a smaller reporting company - Not applicable as the Company is a smaller reporting company[420](index=420&type=chunk) [Financial Statements and Supplementary Data](index=65&type=section&id=ITEM%208.%20FINANCIAL%20STATEMENTS%20AND%20SUPPLEMENTARY%20DATA) This section refers to the Index to Consolidated Financial Statements, beginning on page F-1 of the report - This section directs the reader to the Index to Consolidated Financial Statements located at page F-1 of the Annual Report[421](index=421&type=chunk) [Changes in and Disagreements with Accountants on Accounting and Financial Disclosure](index=65&type=section&id=ITEM%209.%20CHANGES%20IN%20AND%20DISAGREEMENTS%20WITH%20ACCOUNTANTS%20ON%20ACCOUNTING%20AND%20FINANCIAL%20DISCLOSURE) This section is not applicable to the company - Not applicable[422](index=422&type=chunk) [Controls and Procedures](index=65&type=section&id=ITEM%209A.%20CONTROLS%20AND%20PROCEDURES) Management concluded that disclosure controls and internal control over financial reporting were effective as of December 31, 2018, with no material changes identified - Management, including the CEO and CFO, concluded that the company's disclosure controls and procedures were effective as of December 31, 2018[423](index=423&type=chunk) - Based on an evaluation using the COSO framework, management concluded that the company's internal control over financial reporting was effective as of December 31, 2018[426](index=426&type=chunk) - No changes in internal control over financial reporting occurred during the fourth quarter of 2018 that materially affected, or are reasonably likely to materially affect, internal controls[428](index=428&type=chunk) - The company is an emerging growth company and is therefore not required to include an attestation report from its independent registered public accounting firm regarding internal control over financial reporting[427](index=427&type=chunk) [Other Information](index=66&type=section&id=ITEM%209B.%20OTHER%20INFORMATION) This section is not applicable to the company - Not applicable[430](index=430&type=chunk) PART III [Directors, Executive Officers and Corporate Governance](index=66&type=section&id=ITEM%2010.%20DIRECTORS%2C%20EXECUTIVE%20OFFICERS%20AND%20CORPORATE%20GOVERNANCE) This section details biographical information for executive officers and directors, leadership changes, and the company's corporate governance structure, including its Code of Conduct and independent audit committee - Aaron S. Halfacre became CEO, President, and a director on January 1, 2019, succeeding Harold C. Hofer[434](index=434&type=chunk)[437](index=437&type=chunk) - Raymond E. Wirta serves as Chairman of the Board and is a principal of the company's sponsor and advisor[438](index=438&type=chunk) - The board has an audit committee and a conflicts committee, both composed of independent directors, with Jeffrey Randolph chairing the audit committee and designated as the "audit committee financial expert"[435](index=435&type=chunk)[453](index=453&type=chunk) - The company has adopted a Code of Business Conduct and Ethics applicable to all employees, officers, and directors[452](index=452&type=chunk) [Executive Compensation](index=71&type=section&id=ITEM%2011.%20EXECUTIVE%20COMPENSATION) Executive officers are compensated by affiliates, while independent directors receive stock-based compensation, which transitioned from per-meeting awards to quarterly retainers in 2019 - Executive officers are not compensated directly by the Company but by its sponsor, advisor, and/or their affiliates[455](index=455&type=chunk) - In 2019, director compensation was changed from a per-meeting stock award to quarterly retainers of **$12,500** for each independent director, plus additional retainers for committee service, all payable in Class C common stock[456](index=456&type=chunk) 2018 Director Compensation (Stock Awards) | Director | Stock Awards | | :--- | :--- | | David Feinleib | $16,080 | | Vipe Desai | $36,180 | | Jonathan Platt | $41,205 | | Jeffrey Randolph | $53,265 | | John Wang | $21,105 | [Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters](index=72&type=section&id=ITEM%2012.%20SECURITY%20OWNERSHIP%20OF%20CERTAIN%20BENEFICIAL%20OWNERS%20AND%20MANAGEMENT%20AND%20RELATED%20STOCKHOLDER%20MATTERS) As of February 28, 2019, no single person beneficially owned more than 5% of outstanding stock, with executive officers and directors collectively owning less than 1% - As of February 28, 2019, no person is known to be a beneficial owner of more than **5%** of the outstanding Class C or Class S common stock[461](index=461&type=chunk) - All directors and executive officers as a group beneficially owned **18,619 shares** of Class C common stock, representing less than **1%** of the outstanding shares as of February 28, 2019[462](index=462&type=chunk) [Certain Relationships and Related Transactions and Director Independence](index=72&type=section&id=ITEM%2013.%20CERTAIN%20RELATIONSHIPS%20AND%20RELATED%20TRANSACTIONS%20AND%20DIRECTOR%20INDEPENDENCE) The company's related party transactions, including significant fees to its advisor and sponsor, are reviewed by an independent conflicts committee, ensuring fairness - The company is managed by its advisor under an Advisory Agreement, which entitles the advisor to various fees for services such as acquisitions, asset management, and financing[469](index=469&type=chunk)[470](index=470&type=chunk) - The company is obligated to reimburse its sponsor for organizational and offering costs up to **3.0% of gross offering proceeds**, with **$8.4 million** incurred and **$4.2 million** reimbursed as of December 31, 2018[473](index=473&type=chunk) - The board of directors has determined that four of its members (Markman, McWilliams, Nolan, Jr., and Randolph) qualify as Independent Directors under its charter and NYSE standards[467](index=467&type=chunk) - All transactions with related persons are reviewed and approved by the conflicts committee, which is composed of independent directors, to ensure fairness to the company[468](index=468&type=chunk) Fees Incurred to Advisor/Sponsor for Year Ended Dec 31, 2018 | Fee Type | Amount Incurred | | :--- | :--- | | Asset Management Fees | $2,004,760 | | Subordinated Participation Fees | $839,050 | | Acquisition Fees (Capitalized) | $2,752,339 | | Financing Coordination Fees (Capitalized) | $262,050 | | Property Management Fees | $174,529 | [Principal Accounting Fees and Services](index=76&type=section&id=ITEM%2014.%20PRINCIPAL%20ACCOUNTING%20FEES%20AND%20SERVICES) Squar Milner LLP became the independent accounting firm in May 2018, with total fees billed at $292,639 in 2018, all pre-approved by the audit committee - Squar Milner LLP was appointed as the independent registered public accounting firm in May 2018, succeeding Ernst & Young LLP[488](index=488&type=chunk) - The audit committee pre-approves all auditing and permissible non-audit services to ensure auditor independence, with all services in 2017 and 2018 being pre-approved[491](index=491&type=chunk)[492](index=492&type=chunk) Accounting Fees Billed | Fee Type | 2018 | 2017 | | :--- | :--- | :--- | | Audit Fees | $280,279 | $575,160 | | Tax Fees | $12,360 | $66,905 | | **Total** | **$292,639** | **$642,065** | PART IV [Exhibits, Financial Statement Schedules](index=78&type=section&id=ITEM%2015.%20EXHIBITS%2C%20FINANCIAL%20STATEMENT%20SCHEDULES) This section provides an index to the consolidated financial statements, including Schedule III, and a comprehensive list of all exhibits filed with the Form 10-K - This section contains the index to the Consolidated Financial Statements (page F-1) and Schedule III - Real Estate Assets and Accumulated Depreciation and Amortization[494](index=494&type=chunk) - A comprehensive list of exhibits filed with the report is provided, including corporate governance documents, material contracts like the Advisory Agreement, and certifications[497](index=497&type=chunk)[499](index=499&type=chunk) [Form 10-K Summary](index=79&type=section&id=ITEM%2016.%20FORM%2010-K%20SUMMARY) The company has elected not to provide a summary of the Form 10-K - None[499](index=499&type=chunk)