| Maryland (State or other jurisdiction of incorporation or organization) | | | 6798 (Primary Standard Industrial Classification Code Number) | | | 33-0580106 (I.R.S. Employer Identification No.) | |
Copies to: |
| Charles K. Ruck, Esq. Darren J. Guttenberg, Esq. Abigail C. Smith, Esq. Latham & Watkins LLP 650 Town Center Drive 20th Floor Costa Mesa, California 92626 (714) 540-1235 | | | Executive Vice President, General Counsel and Secretary | | | Adam O. Emmerich, Esq. Karessa L. Cain, Esq. Wachtell, Lipton, Rosen & Katz 51 West 52nd Street New York, New York 10019 (212) 403-1000 | |
| Large accelerated filer ☒ | | | Accelerated filer ☐ | |
| Non-accelerated filer ☐ | | | Smaller reporting company ☐ | |
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| | ![]() Chief Executive Officer | |
| Realty Income Corporation 11995 El Camino Real San Diego, California 92130 (858) 284-5000 Attn.: Investor Relations | | | Attn.: Investor Relations | |
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![]() D.F. King & Co., Inc. 48 Wall Street, 22nd floor New York, NY 10005 Call Toll-Free: (866) 356-7814 Email: SRC@dfking.com | ![]() |
| | | Realty Income Common Stock (Close) | | | VEREIT Common Stock (Close) | | | VEREIT Common Stock (adjusted by Exchange Ratio) (Close) | | |||||||||
April 28, 2021 | | | | $ | 68.60 | | | | | $ | 41.26 | | | | | $ | 48.36 | | |
, 2021 | | | | $ | | | | | $ | | | | | $ | | | |
| | | Realty Income Common Stock (Close) | | | Spirit Common Stock (Close) | | | Spirit Common Stock (adjusted by Exchange Ratio) (Close) | | |||||||||
October 27, 2023 | | | | $ | 49.00 | | | | | $ | 32.35 | | | | | $ | 37.34 | | |
December 14, 2023 | | | | $ | 57.82 | | | | | $ | 44.32 | | | | | $ | 44.06 | | |
| | | Realty Income | | | VEREIT | | ||||||||||||||||||||||||||||||||||||||||||
| Historical | | | Pro Forma for Merger | | | Historical | | | Pro Forma for Merger | | ||||||||||||||||||||||||||||||||||||||
| Three Months Ended March 31, 2021 | | | Year Ended December 31, 2020 | | | Three Months Ended March 31, 2021 | | | Year Ended December 31, 2020 | | | Three Months Ended March 31, 2021 | | | Year Ended December 31, 2020 | | | Three Months Ended March 31, 2021 | | | Year Ended December 31, 2020 | | ||||||||||||||||||||||||||
Book earnings per share | | | | $ | 0.26 | | | | | $ | 1.15 | | | | | $ | 0.28 | | | | | $ | 0.48 | | | | | $ | 0.50 | | | | | $ | 0.72 | | | | | $ | 0.20 | | | | | $ | 0.34 | | |
Diluted earnings per share | | | | $ | 0.26 | | | | | $ | 1.14 | | | | | $ | 0.28 | | | | | $ | 0.48 | | | | | $ | 0.50 | | | | | $ | 0.72 | | | | | $ | 0.20 | | | | | $ | 0.34 | | |
Cash dividends declared per share | | | | $ | 0.70 | | | | | $ | 2.80 | | | | | $ | 0.70(1) | | | | | $ | 2.80(1) | | | | | $ | 0.46 | | | | | $ | 1.84 | | | | | $ | 0.50(2) | | | | | $ | 1.97 | | |
Book value per share (period end) | | | | $ | 30.88 | | | | | | | | | | | $ | 42.50 | | | | | | | | | | | $ | 29.43 | | | | | | | | | | | $ | 29.96 | | | | | | | | |
| | | Realty Income | | | Spirit | | | Combined Company | | |||||||||||||||||||||||||||
| | | Historical | | | Historical | | | (Pro Forma for Merger) | | |||||||||||||||||||||||||||
| | | Nine Months Ended September 30, 2023 | | | Year Ended December 31, 2022 | | | Nine Months Ended September 30, 2023 | | | Year Ended December 31, 2022 | | | Nine Months Ended September 30, 2023 | | | Year Ended December 31, 2022 | | ||||||||||||||||||
Earnings per share, basic and diluted | | | | $ | 0.96 | | | | | $ | 1.42 | | | | | $ | 1.28 | | | | | $ | 2.04 | | | | | $ | 0.99 | | | | | $ | 1.35 | | |
Cash dividends declared per share(3) | | | | $ | 2.28(1) | | | | | $ | 2.97(1) | | | | | $ | 2.00(2) | | | | | $ | 2.60(2) | | | | | | | | | | | | | | |
Book value per share (period end) | | | | $ | 43.73 | | | | | $ | 43.49 | | | | | $ | 31.79 | | | | | $ | 32.30 | | | | | $ | 45.10 | | | | | | | | |
| | | Implied Per Share Equity Value | | |||||||||
| Low | | | High | | ||||||||
VEREIT P/2021E AFFO | | | | $ | 42.50 | | | | | $ | 49.00 | | |
VEREIT P/2022E AFFO | | | | $ | 41.50 | | | | | $ | 50.00 | | |
VEREIT Implied Capitalization Rate | | | | $ | 44.25 | | | | | $ | 52.75 | | |
| | | Implied Per Share Equity Value | | |||||||||
| | | Low | | | High | | ||||||
Spirit P/2024E AFFO | | | | $ | 32.00 | | | | | $ | 39.25 | | |
Spirit Implied Capitalization Rate | | | | $ | 31.00 | | | | | $ | 38.00 | | |
| | | Implied Per Share Equity Value | | | Implied Per Share Equity Value | | |||||||||||||||||||
| Low | | High | | | Low | | High | | |||||||||||||||||
Realty Income P/2021E AFFO | | | $ | 51.75 | | | | $ | 71.50 | | | |||||||||||||||
Realty Income P/2022E AFFO | | | $ | 51.50 | | | | $ | 69.25 | | | |||||||||||||||
Realty Income P/2024E AFFO | | | | 44.50 | | | | | 53.75 | | | |||||||||||||||
Realty Income Implied Capitalization Rate | | | $ | 59.25 | | | | $ | 71.75 | | | | | | 47.25 | | | | | 56.75 | | |
| | | Implied Per Share Equity Value | | | Implied Per Share Equity Value | | |||||||||||||||||||
| Low | | High | | | Low | | High | | |||||||||||||||||
VEREIT Discounted Cash Flow | | | $ | 32.50 | | | | $ | 44.25 | | | |||||||||||||||
Spirit Discounted Cash Flow | | | $ | 30.75 | | | | $ | 40.50 | | | |||||||||||||||
Realty Income Discounted Cash Flow | | | $ | 50.25 | | | | $ | 70.00 | | | | | $ | 43.25 | | | | $ | 57.50 | | |
| | | Implied Exchange Ratios | | |||||||||
| | | Low | | | High | | ||||||
P/ | | | | | | | | | | ||||
| | ||||||||||||
Implied Capitalization Rate | | | | | | | | | | | | ||
Discounted Cash Flow | | | | | | | | | | | |
| | | Spirit | | | Realty Income | | ||||||
| | | Comparable Companies Range | | | Implied Share Price Range | | | Comparable Companies Range | | | Implied Share Price Range | |
P/AFFO Per Share Multiples | | | 9.9x to 11.9x | | | $36.08 to 43.38 | | | 12.5x to 14.5x | | | $50.81 to 58.92 | |
Implied Cap Rate | | | 8.1% to 7.6% | | | $35.11 to 39.08 | | | 7.1% to 6.6% | | | $50.41 to 55.90 | |
P/(D) to NAV Per Share (Cons.) | | | (21)% to (11)% | | | $32.84 to 36.98 | | | (10)% to 0% | | | $52.57 to 58.41 | |
P/(D) to NAV Per Share (GSA) | | | (14)% to (4)% | | | $34.29 to 38.26 | | | (5)% to 5% | | | $50.96 to 56.34 | |
Average Range | | | N/A | | | $34.58 to 39.43 | | | N/A | | | $51.19 to 57.39 | |
| Implied Exchange Ratio Range | |
| 0.603x to 0.770x | |
| Implied Per Share Equity Value Reference Range | |
| $32.23 to $43.67 | |
| Implied Per Share Equity Value Reference Range | |
| $47.56 to $69.98 | |
| Implied Exchange Ratio Range | |
| 0.461x to 0.918x | |
Selected Precedent Transactions | | ||||||
Announcement Date | | | Acquirer | | | Target | |
September 2022 | | | Ivory Parent, LLC (an affiliate of GIC and Oak Street Real Estate Capital, LLC) | | | STORE Capital Corporation | |
August 2021 | | | VICI Properties, Inc. | | | MGM Growth Properties LLC | |
November 2021 | | | Industrial Logistics Properties Trust | | | Monmouth Real Estate Investment Corporation | |
April 2021 | | | Realty Income Corporation | | | VEREIT, Inc. | |
May 2018 | | | BRE Glacier Parent L.P. (an affiliate of The Blackstone Group L.P.) | | | Gramercy Property Trust | |
October 2013 | | | American Realty Capital Properties, Inc. | | | Cole Real Estate Investments, Inc. | |
May 2013 | | | American Realty Capital Properties, Inc. | | | CapLease, Inc. | |
September 2012 | | | Realty Income Corporation | | | American Realty Capital Trust, Inc. | |
November 2007 | | | Gramercy Capital Corp. | | | American Financial Realty Trust | |
March 2007 | | | Redford Holdco, LLC (an affiliate of Macquarie Bank Limited and Kaupthing Bank hf.) | | | Spirit Finance Corporation | |
October 2006 | | | General Electric Capital Corporation | | | Trustreet Properties, Inc. | |
September 2005 | | | Flag Fund V LLC (advised by DRA Advisors LLC) | | | Capital Automotive REIT | |
March 2001 | | | General Electric Capital Corporation | | | Franchise Finance Corporation of America | |
| | | Selected Range | | | Implied Share Price Range | | |||||||||
| | | Bottom Quartile | | | Top Quartile | | |||||||||
Premium to Unaffected Price | | | | | 12% | | | | | | 23% | | | | $37.01 to $40.64 | |
| | | Spirit | | | Realty Income | |
| | | Share Price Range | | | Share Price Range | |
Range | | | $32.48 to $44.65 | | | $48.42 to $68.85 | |
| | | Implied Exchange Ratio Range | |
October 27, 2022 to October 26, 2023 | | | 0.472x to 0.922x | |
| Implied Exchange Ratio Range | |
| 0.450x to 0.862x | |
| Implied Exchange Ratio Range | |
| 0.566x to 0.944x | |
| | | Year Ending December 31, | | |||||||||||||||||||||
| | | 2023E | | | 2024E | | | 2025E | | | 2026E | | ||||||||||||
| | | (in millions, except per share data) | | |||||||||||||||||||||
Base Cash Rent (Cash Rent)(1) | | | | $ | 692 | | | | | | 709 | | | | | | 762 | | | | | | 828 | | |
Adjusted Funds from Operations (AFFO)(2) | | | | $ | 509 | | | | | | 516 | | | | | | 550 | | | | | | 588 | | |
Fully Diluted Share Count | | | | | 141 | | | | | | 141 | | | | | | 146 | | | | | | 155 | | |
AFFO(2) / Share | | | | $ | 3.61 | | | | | | 3.65 | | | | | | 3.78 | | | | | | 3.80 | | |
Dividends / Share | | | | $ | 2.67 | | | | | | 2.69 | | | | | | 2.72 | | | | | | 2.75 | | |
Net Acquisitions | | | | $ | 332 | | | | | | 314 | | | | | | 709 | | | | | | 750 | | |
| | | Year Ended December 31, | | |||||||||||||||
| 2021E | | | 2022E | | | 2023E | | |||||||||||
| (in millions, other than per share data) | | |||||||||||||||||
Total Revenue | | | | $ | 1,823 | | | | | $ | 2,013 | | | | | $ | 2,310 | | |
Total Net Operating Income (NOI)(1) | | | | $ | 1,714 | | | | | $ | 1,900 | | | | | $ | 2,181 | | |
EBITDA(2) | | | | $ | 1,624 | | | | | $ | 1,805 | | | | | $ | 2,072 | | |
Funds from Operations (FFO)(3) | | | | $ | 1,253 | | | | | $ | 1,452 | | | | | $ | 1,689 | | |
Adjusted Funds from Operations (AFFO)(4) | | | | $ | 1,314 | | | | | $ | 1,462 | | | | | $ | 1,696 | | |
FFO / Share(3)(5) | | | | $ | 3.29 | | | | | $ | 3.52 | | | | | $ | 3.80 | | |
AFFO / Share(4)(6) | | | | $ | 3.45 | | | | | $ | 3.55 | | | | | $ | 3.81 | | |
Dividends / Share(7) | | | | $ | 2.82 | | | | | $ | 2.85 | | | | | $ | 2.95 | | |
| | | Year Ending December 31, | | |||||||||||||||||||||
| | | 2023E | | | 2024E | | | 2025E | | | 2026E | | ||||||||||||
| | | (in millions, except per share data) | | |||||||||||||||||||||
Cash Rent and Other Revenue(1) | | | | $ | 3,745 | | | | | | 4,278 | | | | | | 4,682 | | | | | | 5,100 | | |
Adjusted Funds from Operations (AFFO)(2) | | | | $ | 2,782 | | | | | | 3,138 | | | | | | 3,376 | | | | | | 3,621 | | |
Fully Diluted Share Count | | | | | 695 | | | | | | 774 | | | | | | 807 | | | | | | 841 | | |
| | | Year Ending December 31, | | |||||||||||||||||||||
| | | 2023E | | | 2024E | | | 2025E | | | 2026E | | ||||||||||||
| | | (in millions, except per share data) | | |||||||||||||||||||||
AFFO(2) / Share | | | | $ | 4.00 | | | | | | 4.06 | | | | | | 4.18 | | | | | | 4.31 | | |
Dividends / Share | | | | $ | 3.05 | | | | | | 3.12 | | | | | | 3.23 | | | | | | 3.33 | | |
Net Investment Spend(3) | | | | $ | 10,191 | | | | | | 4,700 | | | | | | 5,100 | | | | | | 5,500 | | |
| | | Year Ended December 31, | | |||||||||||||||
| 2021E | | | 2022E | | | 2023E | | |||||||||||
| (in millions, other than per share data) | | |||||||||||||||||
Total Revenue | | | | $ | 1,206 | | | | | $ | 1,238 | | | | | $ | 1,292 | | |
Total Net Operating Income (NOI)(1) | | | | $ | 1,069 | | | | | $ | 1,098 | | | | | $ | 1,147 | | |
EBITDA(2) | | | | $ | 1,009 | | | | | $ | 1,033 | | | | | $ | 1,080 | | |
Funds from Operations (FFO)(3) | | | | $ | 744 | | | | | $ | 781 | | | | | $ | 845 | | |
Adjusted Funds from Operations (AFFO)(4) | | | | $ | 748 | | | | | $ | 787 | | | | | $ | 851 | | |
FFO / Share(3)(5) | | | | $ | 3.24 | | | | | $ | 3.36 | | | | | $ | 3.48 | | |
AFFO / Share(4)(6) | | | | $ | 3.26 | | | | | $ | 3.39 | | | | | $ | 3.50 | | |
Dividends / Share(7) | | | | $ | 1.93 | | | | | $ | 2.03 | | | | | $ | 2.10(8) | | |
| | | Year Ending December 31, | | |||||||||||||||
| 2021E | | | 2022E | | | 2023E | | |||||||||||
| (in millions, except per share data) | | |||||||||||||||||
Cash Net Operating Income (Cash NOI)(1) | | | | $ | 1,047 | | | | | $ | 1,107 | | | | | $ | 1,207 | | |
Adjusted Funds from Operations (AFFO)(2) | | | | $ | 753 | | | | | $ | 816 | | | | | $ | 911 | | |
Weighted Average Shares | | | | | 231 | | | | | | 241 | | | | | | 254 | | |
AFFO / Share | | | | $ | 3.26 | | | | | $ | 3.39 | | | | | $ | 3.59 | | |
Net Acquisitions(3) | | | | $ | 794 | | | | | $ | 1,450 | | | | | $ | 1,450 | | |
| | | Year Ending December 31, | | |||||||||||||||
| 2021E | | | 2022E | | | 2023E | | |||||||||||
| (in millions, except per share data) | | |||||||||||||||||
Cash Net Operating Income (Cash NOI)(1)(2) | | | | $ | 1,704 | | | | | $ | 1,885 | | | | | $ | 2,160 | | |
Adjusted Funds from Operations (AFFO)(1) | | | | $ | 1,314 | | | | | $ | 1,462 | | | | | $ | 1,696 | | |
Weighted Average Shares | | | | | 381 | | | | | | 412 | | | | | | 445 | | |
AFFO / Share | | | | $ | 3.45 | | | | | $ | 3.55 | | | | | $ | 3.81 | | |
Net Acquisitions | | | | $ | 3,418 | | | | | $ | 3,325 | | | | | $ | 3,900 | | |
Named Executive Officer | | | Cash ($)(1) | | | Equity Awards ($)(2) | | | Benefits ($)(3) | | | Total ($) | | ||||||||||||
Jackson Hsieh | | | | $ | 7,078,196 | | | | | $ | 31,496,334 | | | | | $ | 44,279 | | | | | $ | 38,618,809 | | |
Michael Hughes | | | | $ | 1,649,334 | | | | | $ | 6,673,502 | | | | | $ | 54,891 | | | | | $ | 8,377,727 | | |
Ken Heimlich | | | | $ | 1,649,334 | | | | | $ | 6,292,152 | | | | | $ | 22,139 | | | | | $ | 7,963,626 | | |
Jay Young | | | | $ | 1,301,142 | | | | | $ | 5,264,586 | | | | | $ | 17,693 | | | | | $ | 6,583,421 | | |
Rochelle Thomas | | | | $ | 1,072,330 | | | | | $ | 3,093,321 | | | | | $ | 27,445 | | | | | $ | 4,193,096 | | |
Named Executive Officer | | | Cash ($)(1) | | | Equity($)(2) | | | Perquisites / Benefits($)(3) | | | Total ($)(4) | | ||||||||||||
Glenn Rufrano | | | | | 8,128,767 | | | | | | 20,279,508 | | | | | | 30,237 | | | | | | 28,438,512 | | |
Michael J. Bartolotta | | | | | 2,701,089 | | | | | | 4,285,241 | | | | | | 12,919 | | | | | | 6,999,249 | | |
Lauren Goldberg | | | | | 2,383,572 | | | | | | 3,958,242 | | | | | | 7,393 | | | | | | 6,349,207 | | |
Paul H. McDowell | | | | | 2,510,579 | | | | | | 4,156,795 | | | | | | 12,919 | | | | | | 6,680,293 | | |
Thomas W. Roberts | | | | | 2,574,082 | | | | | | 5,024,804 | | | | | | 15,615 | | | | | | 7,614,501 | | |
Named Executive Officer | | | Base Salary Payment ($) | | | Annual Bonus ($) | | | Prorated Bonus ($) | | | Total ($) | | ||||||||||||
Jackson Hsieh | | | | $ | 2,784,864 | | | | | $ | 4,177,296 | | | | | $ | 116,036 | | | | | $ | 7,078,196 | | |
Michael Hughes | | | | $ | 983,454 | | | | | $ | 614,659 | | | | | $ | 51,222 | | | | | $ | 1,649,335 | | |
Ken Heimlich | | | | $ | 983,454 | | | | | $ | 614,659 | | | | | $ | 51,222 | | | | | $ | 1,649,335 | | |
Jay Young | | | | $ | 775,836 | | | | | $ | 484,898 | | | | | $ | 40,408 | | | | | $ | 1,301,142 | | |
Rochelle Thomas | | | | $ | 639,402 | | | | | $ | 399,626 | | | | | $ | 33,302 | | | | | $ | 1,072,330 | | |
Named Executive Officer | | | Value of Spirit Restricted Stock Awards ($) | | | Value of Spirit Performance Share Awards ($) | | | Total ($) | | |||||||||
Jackson Hsieh | | | | $ | — | | | | | $ | 31,496,334 | | | | | $ | 31,496,334 | | |
Michael Hughes | | | | $ | — | | | | | $ | 6,673,502 | | | | | $ | 6,673,502 | | |
Ken Heimlich | | | | $ | — | | | | | $ | 6,292,152 | | | | | $ | 6,292,152 | | |
Jay Young | | | | $ | — | | | | | $ | 5,264,586 | | | | | $ | 5,264,586 | | |
Rochelle Thomas | | | | $ | 965,533 | | | | | $ | 2,127,788 | | | | | $ | 3,093,321 | | |
Named Executive Officer | | | Severance ($) | | | Prorated Bonus ($) | | | Total ($) | | |||||||||
Glenn Rufrano | | | | | 7,500,000 | | | | | | 628,767 | | | | | | 8,128,767 | | |
Michael J. Bartolotta | | | | | 2,415,000 | | | | | | 286,089 | | | | | | 2,701,089 | | |
Lauren Goldberg | | | | | 2,152,500 | | | | | | 231,072 | | | | | | 2,383,572 | | |
Paul H. McDowell | | | | | 2,257,500 | | | | | | 253,079 | | | | | | 2,510,579 | | |
Thomas W. Roberts | | | | | 2,310,000 | | | | | | 264,082 | | | | | | 2,574,082 | | |
Named Executive Officer | | | VEREIT Stock Options ($) | | | VEREIT RSU Awards ($) | | | Dividend Equivalents ($) | | | Total ($) | | ||||||||||||
Glenn Rufrano | | | | | 485,675 | | | | | | 18,917,513 | | | | | | 876,320 | | | | | | 20,279,508 | | |
Michael J. Bartolotta | | | | | 485,675 | | | | | | 3,640,053 | | | | | | 159,513 | | | | | | 4,285,241 | | |
Lauren Goldberg | | | | | 485,675 | | | | | | 3,326,804 | | | | | | 145,763 | | | | | | 3,958,242 | | |
Paul H. McDowell | | | | | 485,675 | | | | | | 3,520,788 | | | | | | 150,332 | | | | | | 4,156,795 | | |
Thomas W. Roberts | | | | | 485,675 | | | | | | 4,345,998 | | | | | | 193,131 | | | | | | 5,024,804 | | |
| | Realty Income Common Stock | | VEREIT Common Stock | | | Realty Income Common Stock | | Spirit Common Stock | | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Date | | High | | Low | | Close | | High | | Low | | Close | | | High | | Low | | Close | | High | | Low | | Close | | ||||||||||||||||||||||||||||||||||||||||||||||||
April 28, 2021 | | | $ | 69.33 | | | | $ | 68.50 | | | | $ | 68.60 | | | | $ | 41.65 | | | | $ | 41.19 | | | | $ | 41.26 | | | |||||||||||||||||||||||||||||||||||||||||||
, 2021 | | | $ | | | | $ | | | | $ | | | | $ | | | | $ | | | | $ | | | | ||||||||||||||||||||||||||||||||||||||||||||||||
October 27, 2023 | | | $ | 49.87 | | | | $ | 48.81 | | | | $ | 49.00 | | | | $ | 33.23 | | | | $ | 32.22 | | | | $ | 32.35 | | | |||||||||||||||||||||||||||||||||||||||||||
December 14, 2023 | | | $ | 58.24 | | | | $ | 57.45 | | | | $ | 57.82 | | | | $ | 44.61 | | | | $ | 44.05 | | | | $ | 44.32 | | |
| | Realty Income Common Stock | | VEREIT Common Stock | | | Realty Income Common Stock | | Spirit Common Stock | | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Date | | High | | Low | | Close | | High | | Low | | Close | | | High | | Low | | Close | | High | | Low | | Close | | ||||||||||||||||||||||||||||||||||||||||||||||||
April 28, 2021 | | | $ | 69.33 | | | | $ | 68.50 | | | | $ | 68.60 | | | | $ | 48.88 | | | | $ | 48.29 | | | | $ | 48.36 | | | |||||||||||||||||||||||||||||||||||||||||||
, 2021 | | | $ | | | | $ | | | | $ | | | | $ | | | | $ | | | | $ | | | | ||||||||||||||||||||||||||||||||||||||||||||||||
October 27, 2023 | | | $ | 49.87 | | | | $ | 48.81 | | | | $ | 49.00 | | | | $ | 38.00 | | | | $ | 37.19 | | | | $ | 37.34 | | | |||||||||||||||||||||||||||||||||||||||||||
December 14, 2023 | | | $ | 58.24 | | | | $ | 57.45 | | | | $ | 57.82 | | | | $ | 44.38 | | | | $ | 43.78 | | | | $ | 44.06 | | |
| | High | | Low | | Dividend Declared | | | High | | Low | | Dividend Declared | | ||||||||||||||||||||||||
2018 | | | | | | | | | | | | | | | | | ||||||||||||||||||||||
First Quarter | | | $ | 57.07 | | | | $ | 47.26 | | | | $ | 0.6575 | | | ||||||||||||||||||||||
Second Quarter | | | $ | 54.99 | | | | $ | 48.81 | | | | $ | 0.6590 | | | ||||||||||||||||||||||
Third Quarter | | | $ | 59.18 | | | | $ | 52.74 | | | | $ | 0.6605 | | | ||||||||||||||||||||||
Fourth Quarter | | | $ | 66.85 | | | | $ | 55.56 | | | | $ | 0.6620 | | | ||||||||||||||||||||||
2019 | | | | | | | | | | | | | | | | | ||||||||||||||||||||||
First Quarter | | | $ | 74.14 | | | | $ | 61.60 | | | | $ | 0.6770 | | | ||||||||||||||||||||||
Second Quarter | | | $ | 73.94 | | | | $ | 66.21 | | | | $ | 0.6785 | | | ||||||||||||||||||||||
Third Quarter | | | $ | 77.50 | | | | $ | 67.70 | | | | $ | 0.6800 | | | ||||||||||||||||||||||
Fourth Quarter | | | $ | 82.17 | | | | $ | 71.45 | | | | $ | 0.6815 | | | ||||||||||||||||||||||
2020 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | ||||||
First Quarter | | | $ | 84.92 | | | | $ | 38.00 | | | | $ | 0.6980 | | | | | $ | 84.92 | | | | $ | 38.00 | | | | $ | 0.6980 | | | ||||||
Second Quarter | | | $ | 65.56 | | | | $ | 43.41 | | | | $ | 0.6995 | | | | | $ | 65.56 | | | | $ | 43.41 | | | | $ | 0.6995 | | | ||||||
Third Quarter | | | $ | 66.80 | | | | $ | 56.33 | | | | $ | 0.7010 | | | | | $ | 66.80 | | | | $ | 56.33 | | | | $ | 0.7010 | | | ||||||
Fourth Quarter | | | $ | 65.09 | | | | $ | 57.09 | | | | $ | 0.7025 | | | | | $ | 65.09 | | | | $ | 57.09 | | | | $ | 0.7025 | | | ||||||
2021 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | ||||||
First Quarter | | | $ | 64.60 | | | | $ | 57.00 | | | | $ | 0.7040 | | | | | $ | 64.60 | | | | $ | 57.00 | | | | $ | 0.7040 | | | ||||||
Second Quarter | | | $ | | | | $ | | | | $ | | | | | $ | 71.84 | | | | $ | 63.64 | | | | $ | 0.7045 | | | |||||||||
Third Quarter (through , 2021) | | | $ | | | | $ | | | | | | | | ||||||||||||||||||||||||
Third Quarter | | | $ | 72.75 | | | | $ | 64.86 | | | | $ | 0.7065 | | | ||||||||||||||||||||||
Fourth Quarter | | | $ | 74.60 | | | | $ | 64.98 | | | | $ | 0.7180 | | | ||||||||||||||||||||||
2022 | | | | | | | | | | | | | | | | | ||||||||||||||||||||||
First Quarter | | | $ | 72.55 | | | | $ | 63.90 | | | | $ | 0.7395 | | | ||||||||||||||||||||||
Second Quarter | | | $ | 75.40 | | | | $ | 62.29 | | | | $ | 0.7410 | | | ||||||||||||||||||||||
Third Quarter | | | $ | 75.11 | | | | $ | 57.61 | | | | $ | 0.7425 | | | ||||||||||||||||||||||
Fourth Quarter | | | $ | 66.44 | | | | $ | 55.50 | | | | $ | 0.7440 | | | ||||||||||||||||||||||
2023 | | | | | | | | | | | | | | | | | ||||||||||||||||||||||
First Quarter | | | $ | 68.85 | | | | $ | 59.07 | | | | $ | 0.7515 | | | ||||||||||||||||||||||
Second Quarter | | | $ | 63.55 | | | | $ | 58.13 | | | | $ | 0.7650 | | |
| | | High | | | Low | | | Dividend Declared | | |||||||||
Third Quarter | | | | $ | 64.18 | | | | | $ | 49.38 | | | | | $ | 0.7665 | | |
Fourth Quarter (through December 14, 2023) | | | | $ | 58.22 | | | | | $ | 45.08 | | | | | $ | 0.7680 | | |
| | High | | Low | | Dividend Declared | | | High | | Low | | Dividend Declared | | ||||||||||||||||||||||||
2018 | | | | | | | | | | | | | | | | | ||||||||||||||||||||||
First Quarter | | | $ | 39.15 | | | | $ | 33.10 | | | | $ | 0.6875 | | | ||||||||||||||||||||||
Second Quarter | | | $ | 37.85 | | | | $ | 32.60 | | | | $ | 0.6875 | | | ||||||||||||||||||||||
Third Quarter | | | $ | 40.00 | | | | $ | 35.58 | | | | $ | 0.6875 | | | ||||||||||||||||||||||
Fourth Quarter | | | $ | 39.55 | | | | $ | 34.40 | | | | $ | 0.6875 | | | ||||||||||||||||||||||
2019 | | | | | | | | | | | | | | | | | ||||||||||||||||||||||
First Quarter | | | $ | 42.80 | | | | $ | 35.00 | | | | $ | 0.6875 | | | ||||||||||||||||||||||
Second Quarter | | | $ | 48.58 | | | | $ | 39.63 | | | | $ | 0.6875 | | | ||||||||||||||||||||||
Third Quarter | | | $ | 50.65 | | | | $ | 43.85 | | | | $ | 0.6875 | | | ||||||||||||||||||||||
Fourth Quarter | | | $ | 50.25 | | | | $ | 45.10 | | | | $ | 0.6875 | | | ||||||||||||||||||||||
2020 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | ||||||
First Quarter | | | $ | 50.90 | | | | $ | 17.78 | | | | $ | 0.6875 | | | | | $ | 54.63 | | | | $ | 18.37 | | | | $ | 0.6250 | | | ||||||
Second Quarter | | | $ | 36.80 | | | | $ | 19.00 | | | | $ | 0.3850 | | | | | $ | 40.43 | | | | $ | 20.83 | | | | $ | 0.6250 | | | ||||||
Third Quarter | | | $ | 36.40 | | | | $ | 29.85 | | | | $ | 0.3850 | | | | | $ | 38.21 | | | | $ | 31.30 | | | | $ | 0.6250 | | | ||||||
Fourth Quarter | | | $ | 39.03 | | | | $ | 30.05 | | | | $ | 0.3850 | | | | | $ | 42.32 | | | | $ | 29.40 | | | | $ | 0.6250 | | | ||||||
2021 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | ||||||
First Quarter | | | $ | 40.67 | | | | $ | 34.76 | | | | $ | 0.4620 | | | | | $ | 45.25 | | | | $ | 36.89 | | | | $ | 0.6250 | | | ||||||
Second Quarter | | | $ | | | | $ | | | | $ | 0.4620 | | | | | $ | 51.17 | | | | $ | 42.52 | | | | $ | 0.6250 | | | ||||||||
Third Quarter | | | $ | 52.29 | | | | $ | 46.01 | | | | $ | 0.6380 | | | ||||||||||||||||||||||
Fourth Quarter | | | $ | 51.00 | | | | $ | 43.65 | | | | $ | 0.6380 | | | ||||||||||||||||||||||
2022 | | | | | | | | | | | | | | | | | ||||||||||||||||||||||
First Quarter | | | $ | 49.94 | | | | $ | 43.78 | | | | $ | 0.6380 | | | ||||||||||||||||||||||
Second Quarter | | | $ | 48.24 | | | | $ | 35.79 | | | | $ | 0.6380 | | | ||||||||||||||||||||||
Third Quarter | | | $ | 44.93 | | | | $ | 35.37 | | | | $ | 0.6630 | | | ||||||||||||||||||||||
Fourth Quarter | | | $ | 42.65 | | | | $ | 34.31 | | | | $ | 0.6630 | | | ||||||||||||||||||||||
2023 | | | | | | | | | | | | | | | | | ||||||||||||||||||||||
First Quarter | | | $ | 44.65 | | | | $ | 37.05 | | | | $ | 0.6630 | | | ||||||||||||||||||||||
Second Quarter | | | $ | 40.57 | | | | $ | 36.91 | | | | $ | 0.6630 | | | ||||||||||||||||||||||
Third Quarter | | | $ | 42.33 | | | | $ | 32.83 | | | | $ | 0.6696 | | | ||||||||||||||||||||||
Fourth Quarter (through December 14, 2023) | | | $ | 44.61 | | | | $ | 32.22 | | | | $ | 0.6696 | | |
| | | High | | | Low | | | Dividend Declared | | |||||||||
2020 | | | | | | | | | | | | | | | | | | | |
First Quarter | | | | $ | 27.10 | | | | | $ | 12.14 | | | | | $ | 0.3750 | | |
Second Quarter | | | | $ | 25.70 | | | | | $ | 17.77 | | | | | $ | 0.3750 | | |
Third Quarter | | | | $ | 27.01 | | | | | $ | 23.80 | | | | | $ | 0.3750 | | |
Fourth Quarter | | | | $ | 27.10 | | | | | $ | 25.18 | | | | | $ | 0.3750 | | |
2021 | | | | | | | | | | | | | | | | | | | |
First Quarter | | | | $ | 26.90 | | | | | $ | 25.44 | | | | | $ | 0.3750 | | |
Second Quarter | | | | $ | 27.66 | | | | | $ | 26.01 | | | | | $ | 0.3750 | | |
Third Quarter | | | | $ | 26.96 | | | | | $ | 25.54 | | | | | $ | 0.3750 | | |
Fourth Quarter | | | | $ | 26.26 | | | | | $ | 25.19 | | | | | $ | 0.3750 | | |
2022 | | | | | | | | | | | | | | | | | | | |
First Quarter | | | | $ | 25.75 | | | | | $ | 24.50 | | | | | $ | 0.3750 | | |
Second Quarter | | | | $ | 25.64 | | | | | $ | 22.96 | | | | | $ | 0.3750 | | |
| | | High | | | Low | | | Dividend Declared | | |||||||||
Third Quarter | | | | $ | 26.00 | | | | | $ | 22.52 | | | | | $ | 0.3750 | | |
Fourth Quarter | | | | $ | 23.67 | | | | | $ | 21.00 | | | | | $ | 0.3750 | | |
2023 | | | | | | | | | | | | | | | | | | | |
First Quarter | | | | $ | 24.37 | | | | | $ | 19.45 | | | | | $ | 0.3750 | | |
Second Quarter | | | | $ | 24.69 | | | | | $ | 21.43 | | | | | $ | 0.3750 | | |
Third Quarter | | | | $ | 22.80 | | | | | $ | 20.10 | | | | | $ | 0.3750 | | |
Fourth Quarter (through December 14, 2023) | | | | $ | 24.62 | | | | | $ | 19.72 | | | | | $ | 0.3750 | | |
| | Realty Income Historical, As Reclassified (Note 3) | | VEREIT Historical, As Reclassified (Note 3) | | Merger Adjustments (Note 5) | | Item in Note 5 | | Pro Forma Combined | | | Realty Income Historical | | Spirit Historical, As Reclassified (Note 3) | | Pro Forma Transactions Adjustments (Note 4) | | Item in Note 4 | | Pro Forma Combined | | |||||||||||||||||||||||||||||||||||||
ASSETS | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | ||||||||||
Real estate held for investment, at cost: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | ||||||||||
Land | | | $ | 6,672,885 | | | | $ | 2,698,232 | | | | $ | 593,773 | | | [1] | | | $ | 9,964,890 | | | | | $ | 14,408,324 | | | | $ | 1,808,364 | | | | $ | 49,088 | | | | | [1] | | | | $ | 16,265,776 | | | ||||||||||
Buildings and improvements | | | | 15,171,070 | | | | | 9,941,903 | | | | | 783,350 | | | [1] | | | | 25,896,323 | | | | | | 33,606,951 | | | | | 7,015,086 | | | | | (948,871) | | | | | [1] | | | | | 39,673,166 | | | ||||||||||
Total real estate held for investment, at cost | | | | 21,843,955 | | | | | 12,640,135 | | | | | 1,377,123 | | | | | | | 35,861,213 | | | | | | 48,015,275 | | | | | 8,823,450 | | | | | (899,783) | | | | | | | | | | 55,938,942 | | | ||||||||||
Less accumulated depreciation and amortization | | | | (3,668,269) | | | | | (2,909,417) | | | | | 2,909,417 | | | [2] | | | | (3,668,269) | | | | | | (5,781,056) | | | | | (1,354,807) | | | | | 1,354,807 | | | | | [2] | | | | | (5,781,056) | | | ||||||||||
Real estate held for investment, net | | | | 18,175,686 | | | | | 9,730,718 | | | | | 4,286,540 | | | | | | | 32,192,944 | | | | | | 42,234,219 | | | | | 7,468,643 | | | | | 455,024 | | | | | | | | | | 50,157,886 | | | ||||||||||
Real estate and lease intangibles held for sale, net | | | | 22,500 | | | | | 4,888 | | | | | 6,412 | | | [3] | | | | 33,800 | | | | | | 19,927 | | | | | 61,545 | | | | | 31,255 | | | | | [3] | | | | | 112,727 | | | ||||||||||
Cash and cash equivalents | | | | 183,984 | | | | | 318,561 | | | | | (374,066) | | | [8] [12] | | | | 128,479 | | | | | | 344,129 | | | | | 134,166 | | | | | (156,656) | | | | | [4] | | | | | 321,639 | | | ||||||||||
Accounts receivable, net | | | | 307,017 | | | | | 330,871 | | | | | (278,871) | | | [4] | | | | 359,017 | | | | | | 678,441 | | | | | 199,826 | | | | | (185,245) | | | | | [5] | | | | | 693,022 | | | ||||||||||
Lease intangible assets, net | | | | 1,820,146 | | | | | 931,832 | | | | | 1,779,006 | | | [5] | | | | 4,530,984 | | | | | | 5,089,293 | | | | | 389,100 | | | | | 844,630 | | | | | [6] | | | | | 6,323,023 | | | ||||||||||
Goodwill | | | | 14,114 | | | | | 1,337,773 | | | | | (120,500) | | | [6] | | | | 1,231,387 | | | | | | 3,731,478 | | | | | 225,600 | | | | | 377,467 | | | | | [7] | | | | | 4,334,545 | | | ||||||||||
Other assets, net | | | | 456,123 | | | | | 322,715 | | | | | 24,466 | | | [7] | | | | 803,304 | | | | | | 3,239,433 | | | | | 171,328 | | | | | (11,785) | | | | | [8] | | | | | 3,398,976 | | | ||||||||||
Total assets | | | $ | 20,979,570 | | | | $ | 12,977,358 | | | | $ | 5,322,987 | | | | | | $ | 39,279,915 | | | | | $ | 55,336,920 | | | | $ | 8,650,208 | | | | $ | 1,354,690 | | | | | | | | | $ | 65,341,818 | | | ||||||||||
LIABILITIES AND EQUITY | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | ||||||||||
Distributions payable | | | $ | 88,662 | | | | $ | 106,989 | | | | $ | (1,041) | | | [8] | | | $ | 194,610 | | | | | $ | 187,288 | | | | $ | 99,571 | | | | $ | (99,571) | | | | | [4] | | | | $ | 187,288 | | | ||||||||||
Accounts payable and accrued expenses | | | | 200,168 | | | | | 116,486 | | | | | 76,000 | | | [9] | | | | 392,654 | | | | | | 660,366 | | | | | 69,045 | | | | | 60,000 | | | | | [9] | | | | | 789,411 | | | ||||||||||
Lease intangible liabilities, net | | | | 313,907 | | | | | 117,121 | | | | | 382,580 | | | [10] | | | | 813,608 | | | | | | 1,426,264 | | | | | 106,814 | | | | | 284,677 | | | | | [10] | | | | | 1,817,755 | | | ||||||||||
Other liabilities | | | | 277,325 | | | | | 264,968 | | | | | — | | | | | | | 542,293 | | | | | | 786,437 | | | | | 61,737 | | | | | — | | | | | | | | | | 848,174 | | | ||||||||||
Line of credit payable and commercial paper | | | | 675,000 | | | | | — | | | | | — | | | | | | | 675,000 | | | | | | 858,260 | | | | | — | | | | | — | | | | | | | | | | 858,260 | | | ||||||||||
Term loan, net | | | | 249,407 | | | | | — | | | | | — | | | | | | | 249,407 | | | | | | 1,287,995 | | | | | 1,090,198 | | | | | 10,507 | | | | | [11] | | | | | 2,388,700 | | | ||||||||||
Mortgages payable, net | | | | 282,037 | | | | | 1,035,328 | | | | | 61,075 | | | [11] | | | | 1,378,440 | | | | | | 824,240 | | | | | 4,545 | | | | | (316) | | | | | [11] | | | | | 828,469 | | | ||||||||||
Notes payable, net | | | | 7,326,051 | | | | | 4,586,252 | | | | | 338,994 | | | [11] | | | | 12,251,297 | | | | | | 17,482,652 | | | | | 2,725,505 | | | | | (385,651) | | | | | [11] | | | | | 19,822,506 | | | ||||||||||
Total liabilities | | | | 9,412,557 | | | | | 6,227,144 | | | | | 857,608 | | | | | | | 16,497,309 | | | | | | 23,513,502 | | | | | 4,157,415 | | | | | (130,354) | | | | | | | | | | 27,540,563 | | | ||||||||||
Stockholders’ equity: | | | | | | | | | | | | | | | | | | | | | | | | ||||||||||||||||||||||||||||||||||||
Commitments and contingencies | | | | | | | | | | | | | | | | | | | | | | | | | | | |||||||||||||||||||||||||||||||||
STOCKHOLDERS’ EQUITY: | | | | | | | | | | | | | | | | | | | | | | | | | | | |||||||||||||||||||||||||||||||||
Preferred stock and paid-in capital | | | | — | | | | | 371,781 | | | | | (371,781) | | | [12] | | | | — | | | | | | — | | | | | 166,177 | | | | | (1,957) | | | | | [12] | | | | | 164,220 | | | ||||||||||
Common stock and paid-in capital | | | | 15,371,016 | | | | | 12,981,320 | | | | | (1,737,692) | | | [12] | | | | 26,614,644 | | | | | | 38,031,829 | | | | | 7,307,795 | | | | | (1,412,109) | | | | | [12] | | | | | 43,927,515 | | | ||||||||||
Distributions in excess of net income | | | | (3,827,660) | | | | | (6,610,678) | | | | | 6,581,472 | | | [12] | | | | (3,856,866) | | | | | | (6,416,534) | | | | | (3,036,475) | | | | | 2,954,406 | | | | | [12] | | | | | (6,498,603) | | | ||||||||||
Accumulated other comprehensive (loss) income | | | | (8,484) | | | | | 634 | | | | | (634) | | | [12] | | | | (8,484) | | | ||||||||||||||||||||||||||||||||||||
Accumulated other comprehensive income | | | | 41,849 | | | | | 55,296 | | | | | (55,296) | | | | | [12] | | | | | 41,849 | | | |||||||||||||||||||||||||||||||||
Total stockholders’ equity | | | | 11,534,872 | | | | | 6,743,057 | | | | | 4,471,365 | | | | | | | 22,749,294 | | | | | | 31,657,144 | | | | | 4,492,793 | | | | | 1,485,044 | | | | | | | | | | 37,634,981 | | | ||||||||||
Noncontrolling interests | | | | 32,141 | | | | | 7,157 | | | | | (5,986) | | | [13] | | | | 33,312 | | | | | | 166,274 | | | | | — | | | | | — | | | | | | | | | | 166,274 | | | ||||||||||
Total equity | | | | 11,567,013 | | | | | 6,750,214 | | | | | 4,465,379 | | | | | | | 22,782,606 | | | | | | 31,823,418 | | | | | 4,492,793 | | | | | 1,485,044 | | | | | | | | | | 37,801,255 | | | ||||||||||
Total liabilities and equity | | | $ | 20,979,570 | | | | $ | 12,977,358 | | | | $ | 5,322,987 | | | | | | $ | 39,279,915 | | | | | $ | 55,336,920 | | | | $ | 8,650,208 | | | | $ | 1,354,690 | | | | | | | | | $ | 65,341,818 | | |
| | | Realty Income Historical | | | VEREIT Historical, As Reclassified (Note 3) | | | Merger Adjustments (Note 5) | | | Item in Note 5 | | | Pro Forma Combined | | | Item in Note 5 | | ||||||||||||||||||
REVENUE | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Rental (including reimbursable) | | | | $ | 439,365 | | | | | $ | 290,309 | | | | | $ | 18,460 | | | | | | [14] | | | | | $ | 748,134 | | | | | | | | |
Other | | | | | 3,439 | | | | | | 4,166 | | | | | | — | | | | | | | | | | | | 7,605 | | | | | | | | |
Total revenue | | | | | 442,804 | | | | | | 294,475 | | | | | | 18,460 | | | | | | | | | | | | 755,739 | | | | | | | | |
EXPENSES | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Depreciation and amortization | | | | | 177,985 | | | | | | 108,075 | | | | | | 95,789 | | | | | | [15] | | | | | | 381,849 | | | | | | | | |
Interest | | | | | 73,075 | | | | | | 60,736 | | | | | | (15,191) | | | | | | [16] | | | | | | 118,620 | | | | | | | | |
Property (including reimbursable) | | | | | 28,499 | | | | | | 30,605 | | | | | | 1,436 | | | | | | [17] | | | | | | 60,540 | | | | | | | | |
General and administrative | | | | | 20,796 | | | | | | 15,948 | | | | | | 3,448 | | | | | | [18] | | | | | | 40,192 | | | | | | | | |
Income taxes | | | | | 6,225 | | | | | | 928 | | | | | | — | | | | | | | | | | | | 7,153 | | | | | | | | |
Provisions for impairment | | | | | 2,720 | | | | | | 31,849 | | | | | | — | | | | | | | | | | | | 34,569 | | | | | | | | |
Total expenses | | | | | 309,300 | | | | | | 248,141 | | | | | | 85,482 | | | | | | | | | | | | 642,923 | | | | | | | | |
Gain on sales of real estate | | | | | 8,401 | | | | | | 76,074 | | | | | | — | | | | | | | | | | | | 84,475 | | | | | | | | |
Foreign currency and derivative gains, net | | | | | 804 | | | | | | — | | | | | | — | | | | | | | | | | | | 804 | | | | | | | | |
Equity in income of unconsolidated entities | | | | | — | | | | | | 447 | | | | | | — | | | | | | | | | | | | 447 | | | | | | | | |
Loss on extinguishment of debt | | | | | (46,473) | | | | | | (2,132) | | | | | | — | | | | | | | | | | | | (48,605) | | | | | | | | |
Income from continuing operations | | | | | 96,236 | | | | | | 120,723 | | | | | | (67,022) | | | | | | | | | | | | 149,937 | | | | | | | | |
Income attributable to noncontrolling interests | | | | | (296) | | | | | | (76) | | | | | | — | | | | | | | | | | | | (372) | | | | | | | | |
Income from continuing operations available to common stockholders | | | | $ | 95,940 | | | | | $ | 120,647 | | | | | $ | (67,022) | | | | | | | | | | | $ | 149,565 | | | | | | | | |
Income from continuing operations available to common stockholders per common share: | | ||||||||||||||||||||||||||||||||||||
Basic and diluted | | | | $ | 0.26 | | | | | $ | 0.50 | | | | | | | | | | | | | | | | | $ | 0.28 | | | | | | [20] | | |
Weighted average common shares outstanding: | | ||||||||||||||||||||||||||||||||||||
Basic | | | | | 371,522,607 | | | | | | 229,159,472 | | | | | | (67,435,394) | | | | | | | | | | | | 533,246,685 | | | | | | [20] | | |
Diluted | | | | | 371,601,901 | | | | | | 229,429,867 | | | | | | (67,188,665) | | | | | | | | | | | | 533,843,103 | | | | | | [20] | | |
| | | Realty Income Historical | | | Spirit Historical, As Reclassified (Note 3) | | | Pro Forma Transactions Adjustments (Note 4) | | | Item in Note 4 | | | Pro Forma Combined | | |||||||||||||||
REVENUE | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Rental (including reimbursable) | | | | $ | 2,929,440 | | | | | $ | 561,765 | | | | | $ | 24,244 | | | | | | [13] | | | | | $ | 3,515,449 | | |
Other | | | | | 73,268 | | | | | | 9,200 | | | | | | 1,212 | | | | | | [14] | | | | | | 83,680 | | |
Total revenue | | | | | 3,002,708 | | | | | | 570,965 | | | | | | 25,456 | | | | | | | | | | | | 3,599,129 | | |
EXPENSES | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Depreciation and amortization | | | | | 1,419,321 | | | | | | 236,527 | | | | | | 15,180 | | | | | | [15] | | | | | | 1,671,028 | | |
Interest | | | | | 522,110 | | | | | | 104,993 | | | | | | 63,066 | | | | | | [16] | | | | | | 690,169 | | |
Property (including reimbursable) | | | | | 235,081 | | | | | | 24,077 | | | | | | 72 | | | | | | [17] | | | | | | 259,230 | | |
General and administrative | | | | | 106,521 | | | | | | 46,190 | | | | | | — | | | | | | | | | | | | 152,711 | | |
Provisions for impairment | | | | | 59,801 | | | | | | 36,052 | | | | | | — | | | | | | | | | | | | 95,853 | | |
Merger and integration-related costs | | | | | 4,532 | | | | | | — | | | | | | — | | | | | | | | | | | | 4,532 | | |
Total expenses | | | | | 2,347,366 | | | | | | 447,839 | | | | | | 78,318 | | | | | | | | | | | | 2,873,523 | | |
Gain on sales of real estate | | | | | 19,675 | | | | | | 66,450 | | | | | | — | | | | | | | | | | | | 86,125 | | |
Foreign currency and derivative gain, net | | | | | 4,957 | | | | | | — | | | | | | — | | | | | | | | | | | | 4,957 | | |
Equity in income and impairment of investment in unconsolidated entities | | | | | 411 | | | | | | — | | | | | | — | | | | | | | | | | | | 411 | | |
Other income, net | | | | | 12,985 | | | | | | — | | | | | | — | | | | | | | | | | | | 12,985 | | |
Income before income taxes | | | | | 693,370 | | | | | | 189,576 | | | | | | (52,862) | | | | | | | | | | | | 830,084 | | |
Income taxes | | | | | (36,218) | | | | | | (754) | | | | | | — | | | | | | | | | | | | (36,972) | | |
Net income | | | | | 657,152 | | | | | | 188,822 | | | | | | (52,862) | | | | | | | | | | | | 793,112 | | |
Net income attributable to noncontrolling interests | | | | | (3,248) | | | | | | — | | | | | | — | | | | | | | | | | | | (3,248) | | |
Dividends paid to preferred stockholders | | | | | — | | | | | | (7,763) | | | | | | — | | | | | | | | | | | | (7,763) | | |
Net income available to common stockholders | | | | $ | 653,904 | | | | | $ | 181,059 | | | | | $ | (52,862) | | | | | | | | | | | $ | 782,101 | | |
Amounts available to common stockholders per common share: | | | | | | | | | | | | | | | | | | | | | | | | | | | (Note 5) | | |||
Net income, basic and diluted | | | | $ | 0.96 | | | | | $ | 1.28 | | | | | | | | | | | | | | | | | $ | 0.99 | | |
Weighted average common shares outstanding: | | | | | | | | | | | | | | | | | | | | | | | | | | | (Note 5) | | |||
Basic | | | | | 681,419 | | | | | | 141,095 | | | | | | | | | | | | | | | | | | 789,815 | | |
Diluted | | | | | 682,129 | | | | | | 141,103 | | | | | | | | | | | | | | | | | | 790,525 | | |
| | | Realty Income Historical | | | VEREIT Historical, As Reclassified (Note 3) | | | Merger Adjustments (Note 5) | | | Item in Note 5 | | | Pro Forma Combined | | | Item in Note 5 | | ||||||||||||||||||
REVENUE | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Rental (including reimbursable) | | | | $ | 1,639,533 | | | | | $ | 1,158,285 | | | | | $ | 58,161 | | | | | | [14] | | | | | $ | 2,855,979 | | | | | | | | |
Other | | | | | 12,092 | | | | | | 9,691 | | | | | | — | | | | | | | | | | | | 21,783 | | | | | | | | |
Total revenue | | | | | 1,651,625 | | | | | | 1,167,976 | | | | | | 58,161 | | | | | | | | | | | | 2,877,762 | | | | | | | | |
EXPENSES | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Depreciation and amortization | | | | | 677,038 | | | | | | 452,008 | | | | | | 375,298 | | | | | | [15] | | | | | | 1,504,344 | | | | | | | | |
Interest | | | | | 309,336 | | | | | | 265,660 | | | | | | (63,016) | | | | | | [16] | | | | | | 511,980 | | | | | | | | |
Property (including reimbursable) | | | | | 104,603 | | | | | | 122,967 | | | | | | 5,744 | | | | | | [17] | | | | | | 233,314 | | | | | | | | |
General and administrative | | | | | 73,215 | | | | | | 68,487 | | | | | | 15,509 | | | | | | [18] | | | | | | 157,211 | | | | | | | | |
Income taxes | | | | | 14,693 | | | | | | 4,513 | | | | | | — | | | | | | | | | | | | 19,206 | | | | | | | | |
Provisions for impairment | | | | | 147,232 | | | | | | 65,075 | | | | | | — | | | | | | | | | | | | 212,307 | | | | | | | | |
Merger-related costs | | | | | — | | | | | | — | | | | | | 76,000 | | | | | | [19] | | | | | | 76,000 | | | | | | | | |
Total expenses | | | | | 1,326,117 | | | | | | 978,710 | | | | | | 409,535 | | | | | | | | | | | | 2,714,362 | | | | | | | | |
Gain on sales of real estate | | | | | 76,232 | | | | | | 95,292 | | | | | | — | | | | | | | | | | | | 171,524 | | | | | | | | |
Foreign currency and derivative gains (losses), net | | | | | 4,585 | | | | | | (85,392) | | | | | | — | | | | | | | | | | | | (80,807) | | | | | | | | |
Equity in income and gain on disposition of unconsolidated entities | | | | | — | | | | | | 3,539 | | | | | | — | | | | | | | | | | | | 3,539 | | | | | | | | |
Loss on extinguishment of debt | | | | | (9,819) | | | | | | (1,486) | | | | | | — | | | | | | | | | | | | (11,305) | | | | | | | | |
Income from continuing operations | | | | | 396,506 | | | | | | 201,219 | | | | | | (351,374) | | | | | | | | | | | | 246,351 | | | | | | | | |
Income attributable to noncontrolling interests | | | | | (1,020) | | | | | | (91) | | | | | | — | | | | | | | | | | | | (1,111) | | | | | | | | |
Income from continuing operations available to common stockholders | | | | $ | 395,486 | | | | | $ | 201,128 | | | | | $ | (351,374) | | | | | | | | | | | $ | 245,240 | | | | | | | | |
Income from continuing operations available to common stockholders per common share: | | ||||||||||||||||||||||||||||||||||||
Basic | | | | $ | 1.15 | | | | | $ | 0.72 | | | | | | | | | | | | | | | | | $ | 0.48 | | | | | | [20] | | |
Diluted | | | | $ | 1.14 | | | | | $ | 0.72 | | | | | | | | | | | | | | | | | $ | 0.48 | | | | | | [20] | | |
Weighted average common shares outstanding: | | ||||||||||||||||||||||||||||||||||||
Basic | | | | | 345,280,126 | | | | | | 217,548,175 | | | | | | (55,824,097) | | | | | | | | | | | | 507,004,204 | | | | | | [20] | | |
Diluted | | | | | 345,415,258 | | | | | | 217,862,005 | | | | | | (55,548,984) | | | | | | | | | | | | 507,728,279 | | | | | | [20] | | |
| | | Realty Income Historical | | | Spirit Historical, As Reclassified (Note 3) | | | Pro Forma Transactions Adjustments (Note 4) | | | Item in Note 4 | | | Pro Forma Combined | | |||||||||||||||
REVENUE | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Rental (including reimbursable) | | | | $ | 3,299,657 | | | | | $ | 703,029 | | | | | $ | 36,775 | | | | | | [13] | | | | | $ | 4,039,461 | | |
Other | | | | | 44,024 | | | | | | 6,600 | | | | | | 1,617 | | | | | | [14] | | | | | | 52,241 | | |
Total revenue | | | | | 3,343,681 | | | | | | 709,629 | | | | | | 38,392 | | | | | | | | | | | | 4,091,702 | | |
EXPENSES | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Depreciation and amortization | | | | | 1,670,389 | | | | | | 292,985 | | | | | | 42,623 | | | | | | [15] | | | | | | 2,005,997 | | |
Interest | | | | | 465,223 | | | | | | 117,622 | | | | | | 86,643 | | | | | | [16] | | | | | | 669,488 | | |
Property (including reimbursable) | | | | | 226,330 | | | | | | 29,837 | | | | | | 96 | | | | | | [17] | | | | | | 256,263 | | |
General and administrative | | | | | 138,459 | | | | | | 62,023 | | | | | | — | | | | | | | | | | | | 200,482 | | |
Provisions for impairment | | | | | 25,860 | | | | | | 37,156 | | | | | | — | | | | | | | | | | | | 63,016 | | |
Merger and integration-related costs | | | | | 13,897 | | | | | | — | | | | | | 82,069 | | | | | | [18] | | | | | | 95,966 | | |
Total expenses | | | | | 2,540,158 | | | | | | 539,623 | | | | | | 211,431 | | | | | | | | | | | | 3,291,212 | | |
Gain on sales of real estate | | | | | 102,957 | | | | | | 110,900 | | | | | | — | | | | | | | | | | | | 213,857 | | |
Foreign currency and derivative (loss), net | | | | | (13,311) | | | | | | — | | | | | | — | | | | | | | | | | | | (13,311) | | |
Gain (loss) on extinguishment of debt | | | | | 367 | | | | | | (172) | | | | | | — | | | | | | | | | | | | 195 | | |
Equity in income and impairment of investment in unconsolidated entities | | | | | (6,448) | | | | | | — | | | | | | — | | | | | | | | | | | | (6,448) | | |
Other income, net | | | | | 30,511 | | | | | | 5,679 | | | | | | — | | | | | | | | | | | | 36,190 | | |
Income before income taxes | | | | | 917,599 | | | | | | 286,413 | | | | | | (173,039) | | | | | | | | | | | | 1,030,973 | | |
Income taxes | | | | | (45,183) | | | | | | (897) | | | | | | — | | | | | | | | | | | | (46,080) | | |
Net income | | | | | 872,416 | | | | | | 285,516 | | | | | | (173,039) | | | | | | | | | | | | 984,893 | | |
Net income attributable to noncontrolling interests | | | | | (3,008) | | | | | | — | | | | | | — | | | | | | | | | | | | (3,008) | | |
Dividends paid to preferred stockholders | | | | | — | | | | | | (10,350) | | | | | | — | | | | | | | | | | | | (10,350) | | |
Net income available to common stockholders | | | | $ | 869,408 | | | | | $ | 275,166 | | | | | $ | (173,039) | | | | | | | | | | | $ | 971,535 | | |
Amounts available to common stockholders per common share: | | | | | | | | | | | | | | | | | | | | | | | | | | | (Note 5) | | |||
Net income, basic and diluted | | | | $ | 1.42 | | | | | $ | 2.04 | | | | | | | | | | | | | | | | | $ | 1.35 | | |
Weighted average common shares outstanding: | | | | | | | | | | | | | | | | | | | | | | | | | | | (Note 5) | | |||
Basic | | | | | 611,766 | | | | | | 134,548 | | | | | | | | | | | | | | | | | | 720,162 | | |
Diluted | | | | | 612,181 | | | | | | 134,646 | | | | | | | | | | | | | | | | | | 720,577 | | |
| | | March 31, 2021 | | |||
Rent and tenant receivables and other assets, net | | | | $ | 368,926 | | |
Less: Straight-line rent receivable, net | | | | | (278,871) | | |
Less: Accounts receivable, net | | | | | (52,000) | | |
Operating lease right-of-use assets | | | | | 191,443 | | |
Investments in unconsolidated entities | | | | | 80,513 | | |
Restricted cash | | | | | 12,704 | | |
Other assets, net, as presented | | | | $ | 322,715 | | |
| | | September 30, 2023 | | |||
Land and improvements: | | | | $ | 2,742,072 | | |
Land (as presented) | | | | | 1,808,364 | | |
Building and improvements | | | | | 933,708 | | |
| | | March 31, 2021 | | |||
Straight-line rent receivable, net | | | | $ | 278,871 | | |
Accounts receivable, net | | | | | 52,000 | | |
Accounts receivable, net, as presented | | | | $ | 330,871 | | |
| | | March 31, 2021 | | |||
Intangible lease assets | | | | $ | 1,883,826 | | |
Less: Accumulated amortization | | | | | (951,994) | | |
Lease intangible assets, net, as presented | | | | $ | 931,832 | | |
| | | September 30, 2023 | | |||
Loans receivable, net | | | | $ | 52,949 | | |
Portion of deferred costs and other assets, net | | | | | 110,975 | | |
Real estate assets under direct financing leases, net | | | | | 7,404 | | |
Other assets, net (as presented) | | | | $ | 171,328 | | |
| | | March 31, 2021 | | |||
Deferred rent and other liabilities | | | | $ | 62,944 | | |
Operating lease liabilities | | | | | 202,024 | | |
Other liabilities, as presented | | | | $ | 264,968 | | |
| | | September 30, 2023 | | |||
Accounts payable, accrued expenses and other liabilities: | | | | $ | 230,353 | | |
Distributions payable (as presented) | | | | | 99,571 | | |
Accounts payable and accrued expenses (as presented) | | | | | 69,045 | | |
Other liabilities (as presented) | | | | | 61,737 | | |
| | | March 31, 2021 | | |||
Preferred stock | | | | $ | 149 | | |
Additional paid-in capital | | | | | 371,632 | | |
Preferred stock and paid-in capital, as presented | | | | $ | 371,781 | | |
| | | March 31, 2021 | | |||
Common stock | | | | $ | 2,291 | | |
Additional paid-in capital | | | | | 13,350,661 | | |
Less: Additional paid-in capital related to preferred stock | | | | | (371,632) | | |
Common stock and paid-in capital, as presented | | | | $ | 12,981,320 | | |
| | | September 30, 2023 | | |||
Common stock | | | | $ | 7,067 | | |
Capital in excess of common stock par value | | | | | 7,300,728 | | |
Common stock and paid-in capital (as presented) | | | | $ | 7,307,795 | | |
| | | For the nine months ended September 30, 2023 | | | For the year ended December 31, 2022 | | ||||||
Interest income on loans receivable | | | | $ | 3,919 | | | | | $ | 1,884 | | |
Earned income from direct financing leases | | | | | 393 | | | | | | 525 | | |
Other operating income | | | | | 4,888 | | | | | | 4,191 | | |
Other revenue (as presented) | | | | $ | 9,200 | | | | | $ | 6,600 | | |
| | | For the three months ended March 31, 2021 | | | For the year ended December 31, 2020 | | ||||||
Fees from managed partnerships | | | | $ | 500 | | | | | $ | 3,081 | | |
Other income, net | | | | | 3,666 | | | | | | 6,610 | | |
Other, as presented | | | | $ | 4,166 | | | | | $ | 9,691 | | |
| | | For the thre months ended March 31, 2021 | | | For the year ended December 31, 2020 | | ||||||
Acquisition-related | | | | $ | 1,354 | | | | | $ | 4,790 | | |
Litigation and non-routine costs, net | | | | | 68 | | | | | | 2,348 | | |
General and administrative | | | | | 14,526 | | | | | | 61,349 | | |
General and administrative, as presented | | | | $ | 15,948 | | | | | $ | 68,487 | | |
| | | Amount | | |||
Estimated shares of VEREIT common stock and VEREIT OP common units to be exchanged(a) | | | | | 229,281,987 | | |
Exchange Ratio | | | | | 0.705 | | |
Estimated shares of Realty Income common stock to be issued | | | | | 161,643,801 | | |
Closing price of Realty Income common stock on June 1, 2021(b) | | | | $ | 69.35 | | |
Estimated fair value of Realty Income common stock to be issued to former holders of VEREIT common stock and VEREIT OP common units(b) | | | | $ | 11,209,998 | | |
Redemption of VEREIT Series F Preferred Stock and VEREIT OP Series F Preferred OP Units(c) | | | | | 374,066 | | |
Estimated fair value of VEREIT’s equity-based compensation awards attributable to pre-combination services(d) | | | | | 33,630 | | |
Consideration to be transferred | | | | $ | 11,617,694 | | |
Preliminary fair value of VEREIT mortgages payable and notes payable assumed by Realty Income | | | | | 6,021,649 | | |
Total estimated preliminary purchase price | | | | $ | 17,639,343 | | |
| | | Amount | | |||
Shares of Spirit’s common stock to be exchanged(a) | | | | | 141,331,218 | | |
Exchange Ratio | | | | | 0.762 | | |
Shares of Realty Income common stock issued | | | | | 107,694,388 | | |
Closing price of Realty Income common stock on December 11, 2023 | | | | $ | 54.39 | | |
Estimated fair value of Realty Income common stock to be issued to the former holders of Spirit common stock | | | | $ | 5,857,498 | | |
Shares of Realty Income Series A preferred stock issued in exchange for Spirit Series A preferred stock(b) | | | | | 6,900,000 | | |
Closing price of Spirit Series A preferred stock on December 11, 2023(b) | | | | $ | 23.80 | | |
Estimated fair value of Realty Income Series A preferred stock to be issued to the former holders of Spirit Series A preferred stock | | | | $ | 164,220 | | |
Estimated fair value of Spirit’s performance share awards attributable to pre-combination services(c) | | | | $ | 21,538 | | |
Cash payment for accrued and unpaid dividend equivalents to Spirit performance share award holders to be settled by Realty Income(d) | | | | $ | 4,021 | | |
Less: estimated fair value of Spirit restricted stock awards attributable to post-combination costs(e) | | | | $ | (5,419) | | |
Total estimated preliminary purchase price | | | | $ | 6,041,858 | | |
| | | Amount | | |||
Total estimated preliminary purchase price | | | | $ | 17,639,343 | | |
Assets: | | | | | | | |
Real estate held for investment | | | | $ | 14,017,258 | | |
Real estate and lease intangibles held for sale | | | | | 11,300 | | |
Lease intangible assets | | | | | 2,710,838 | | |
Cash and cash equivalents | | | | | 318,561 | | |
Accounts receivable | | | | | 52,000 | | |
Other assets | | | | | 347,181 | | |
Total assets acquired | | | | $ | 17,457,138 | | |
| | | Amount | | |||
Liabilities: | | | | | | | |
Distributions payable | | | | $ | 105,948 | | |
Accounts payable and accrued expenses(a) | | | | | 163,280 | | |
Lease intangible liabilities | | | | | 499,701 | | |
Other liabilities | | | | | 264,968 | | |
Mortgages payable | | | | | 1,096,403 | | |
Notes payable | | | | | 4,925,246 | | |
Total liabilities assumed | | | | $ | 7,055,546 | | |
Estimated preliminary fair value of net assets acquired | | | | $ | 10,401,592 | | |
Add: Estimated preliminary fair value of noncontrolling interests acquired | | | | | 1,171 | | |
Goodwill | | | | $ | 1,217,273 | | |
|
| | | September 30, 2023 | | |||
Land and improvements: | | | | $ | 2,742,072 | | |
Land (as presented) | | | | | 1,808,364 | | |
Building and improvements | | | | | 933,708 | | |
| | | September 30, 2023 | | |||
Loans receivable, net | | | | $ | 52,949 | | |
Portion of deferred costs and other assets, net | | | | | 110,975 | | |
Real estate assets under direct financing leases, net | | | | | 7,404 | | |
Other assets, net (as presented) | | | | $ | 171,328 | | |
| | | September 30, 2023 | | |||
Accounts payable, accrued expenses and other liabilities: | | | | $ | 230,353 | | |
Distributions payable (as presented) | | | | | 99,571 | | |
Accounts payable and accrued expenses (as presented) | | | | | 69,045 | | |
Other liabilities (as presented) | | | | | 61,737 | | |
| | | September 30, 2023 | | |||
Common stock | | | | $ | 7,067 | | |
Capital in excess of common stock par value | | | | | 7,300,728 | | |
Common stock and paid-in capital (as presented) | | | | $ | 7,307,795 | | |
| | | For the nine months ended September 30, 2023 | | | For the year ended December 31, 2022 | | ||||||
Interest income on loans receivable | | | | $ | 3,919 | | | | | $ | 1,884 | | |
Earned income from direct financing leases | | | | | 393 | | | | | | 525 | | |
Other operating income | | | | | 4,888 | | | | | | 4,191 | | |
Other revenue (as presented) | | | | $ | 9,200 | | | | | $ | 6,600 | | |
| | | Amount | | |||
Shares of Spirit’s common stock to be exchanged(a) | | | | | 141,331,218 | | |
Exchange Ratio | | | | | 0.762 | | |
Shares of Realty Income common stock issued | | | | | 107,694,388 | | |
Closing price of Realty Income common stock on December 11, 2023 | | | | $ | 54.39 | | |
Estimated fair value of Realty Income common stock to be issued to the former holders of Spirit common stock | | | | $ | 5,857,498 | | |
Shares of Realty Income Series A preferred stock issued in exchange for Spirit Series A preferred stock(b) | | | | | 6,900,000 | | |
Closing price of Spirit Series A preferred stock on December 11, 2023(b) | | | | $ | 23.80 | | |
Estimated fair value of Realty Income Series A preferred stock to be issued to the former holders of Spirit Series A preferred stock | | | | $ | 164,220 | | |
Estimated fair value of Spirit’s performance share awards attributable to pre-combination services(c) | | | | $ | 21,538 | | |
Cash payment for accrued and unpaid dividend equivalents to Spirit performance share award holders to be settled by Realty Income(d) | | | | $ | 4,021 | | |
Less: estimated fair value of Spirit restricted stock awards attributable to post-combination costs(e) | | | | $ | (5,419) | | |
Total estimated preliminary purchase price | | | | $ | 6,041,858 | | |
| | | September 30, 2023 | | |||
Land and improvements: | | | | $ | 2,742,072 | | |
Land (as presented) | | | | | 1,808,364 | | |
Building and improvements | | | | | 933,708 | | |
| | | September 30, 2023 | | |||
Loans receivable, net | | | | $ | 52,949 | | |
Portion of deferred costs and other assets, net | | | | | 110,975 | | |
Real estate assets under direct financing leases, net | | | | | 7,404 | | |
Other assets, net (as presented) | | | | $ | 171,328 | | |
| | | September 30, 2023 | | |||
Accounts payable, accrued expenses and other liabilities: | | | | $ | 230,353 | | |
Distributions payable (as presented) | | | | | 99,571 | | |
Accounts payable and accrued expenses (as presented) | | | | | 69,045 | | |
Other liabilities (as presented) | | | | | 61,737 | | |
| | | September 30, 2023 | | |||
Common stock | | | | $ | 7,067 | | |
Capital in excess of common stock par value | | | | | 7,300,728 | | |
Common stock and paid-in capital (as presented) | | | | $ | 7,307,795 | | |
| | | For the nine months ended September 30, 2023 | | | For the year ended December 31, 2022 | | ||||||
Interest income on loans receivable | | | | $ | 3,919 | | | | | $ | 1,884 | | |
Earned income from direct financing leases | | | | | 393 | | | | | | 525 | | |
Other operating income | | | | | 4,888 | | | | | | 4,191 | | |
Other revenue (as presented) | | | | $ | 9,200 | | | | | $ | 6,600 | | |
| | | Amount | | |||
Shares of Spirit’s common stock to be exchanged(a) | | | | | 141,331,218 | | |
Exchange Ratio | | | | | 0.762 | | |
Shares of Realty Income common stock issued | | | | | 107,694,388 | | |
Closing price of Realty Income common stock on December 11, 2023 | | | | $ | 54.39 | | |
Estimated fair value of Realty Income common stock to be issued to the former holders of Spirit common stock | | | | $ | 5,857,498 | | |
Shares of Realty Income Series A preferred stock issued in exchange for Spirit Series A preferred stock(b) | | | | | 6,900,000 | | |
Closing price of Spirit Series A preferred stock on December 11, 2023(b) | | | | $ | 23.80 | | |
Estimated fair value of Realty Income Series A preferred stock to be issued to the former holders of Spirit Series A preferred stock | | | | $ | 164,220 | | |
Estimated fair value of Spirit’s performance share awards attributable to pre-combination services(c) | | | | $ | 21,538 | | |
Cash payment for accrued and unpaid dividend equivalents to Spirit performance share award holders to be settled by Realty Income(d) | | | | $ | 4,021 | | |
Less: estimated fair value of Spirit restricted stock awards attributable to post-combination costs(e) | | | | $ | (5,419) | | |
Total estimated preliminary purchase price | | | | $ | 6,041,858 | | |
| | | Amount | | |||
Total estimated preliminary purchase price | | | | $ | 6,041,858 | | |
Assets: | | | | | | | |
Real estate held for investment | | | | $ | 7,923,667 | | |
Real estate and lease intangibles held for sale | | | | | 92,800 | | |
Lease intangible assets | | | | | 1,233,730 | | |
Cash and cash equivalents(a) | | | | | 39,531 | | |
Accounts receivable | | | | | 14,581 | | |
Other assets | | | | | 159,543 | | |
Total assets acquired | | | | $ | 9,463,852 | | |
Liabilities: | | | | | | | |
Accounts payable and accrued expenses(b) | | | | $ | 127,045 | | |
Lease intangible liabilities | | | | | 391,491 | | |
Other liabilities | | | | | 61,737 | | |
Term loan | | | | | 1,100,705 | | |
Mortgages payable | | | | | 4,229 | | |
Notes payable | | | | | 2,339,854 | | |
Total liabilities assumed | | | | $ | 4,025,061 | | |
Estimated preliminary fair value of net assets acquired | | | | $ | 5,438,791 | | |
Goodwill | | | | $ | 603,067 | | |
| | Estimated fair value | | Less: Elimination of historical carrying value | | Total pro forma adjustment | | | Estimated fair value | | Less: Elimination of historical gross carrying value | | Total pro forma adjustment | | ||||||||||||||||||||||||
Land | | | $ | 3,292,005 | | | | $ | (2,698,232) | | | | $ | 593,773 | | | | | $ | 1,857,452 | | | | $ | (1,808,364) | | | | $ | 49,088 | | | ||||||
Buildings and improvements | | | | 10,725,253 | | | | | (9,941,903) | | | | | 783,350 | | | | | | 6,066,215 | | | | | (7,015,086) | | | | | (948,871) | | |
| | | Amount | | |||
Preliminary allocation of fair value: | | | | | | | |
In-place leases | | | | $ | 2,063,904 | | |
Leasing commissions and marketing costs | | | | | 290,457 | | |
Above-market lease assets | | | | | 356,477 | | |
Less: Elimination of historical carrying value of lease intangible assets, net | | | | | (931,832) | | |
Total pro forma adjustment | | | | $ | 1,779,006 | | |
| | | Amount | | |||
Preliminary allocation of fair value: | | | | | | | |
In-place leases | | | | $ | 803,589 | | |
Leasing commissions, legal and marketing costs | | | | | 250,429 | | |
Above-market lease assets | | | | | 179,712 | | |
Less: Elimination of historical carrying value of lease intangible assets, net | | | | | (389,100) | | |
Total pro forma adjustment | | | | $ | 844,630 | | |
| | Mortgages payable | | Notes payable | | | Term loan, net | | Mortgages payable, net | | Notes payable, net | | ||||||||||||||||||||
Estimated fair value | | | $ | 1,096,403 | | | | $ | 4,925,246 | | | |||||||||||||||||||||
Less: Elimination of historical carrying value, including unamortized deferred financing costs and net discounts | | | | (1,035,328) | | | | | (4,586,252) | | | |||||||||||||||||||||
Elimination of historical carrying value of the remaining debt instruments, including unamortized deferred financing costs and net discounts | | | $ | (1,090,198) | | | | $ | (4,545) | | | | $ | (2,725,505) | | | ||||||||||||||||
Estimated pro forma fair value of liabilities assumed in the Merger | | | | 1,100,705 | | | | | 4,229 | | | | | 2,339,854 | | | ||||||||||||||||
Total pro forma adjustment | | | $ | 61,075 | | | | $ | 338,994 | | | | | $ | 10,507 | | | | $ | (316) | | | | $ | (385,651) | | |
| | | Preferred stock and paid-in capital | | | Common stock and paid-in capital | | | Distributions in excess of net income | | | Accumulated other comprehensive (loss) income | | ||||||||||||
Redemption of the VEREIT Series F Preferred Stock(a) | | | | $ | (371,781) | | | | | $ | — | | | | | $ | — | | | | | $ | — | | |
Issuance of Realty Income common stock(b) | | | | | — | | | | | | 11,209,998 | | | | | | — | | | | | | — | | |
Settlement and exchange of VEREIT equity-based awards(c) | | | | | — | | | | | | 33,630 | | | | | | — | | | | | | — | | |
Elimination of VEREIT’s historical equity balances | | | | | — | | | | | | (12,981,320) | | | | | | 6,610,678 | | | | | | (634) | | |
Realty Income merger related costs(d) | | | | | — | | | | | | — | | | | | | (29,206) | | | | | | — | | |
Total pro forma adjustment | | | | $ | (371,781) | | | | | $ | (1,737,692) | | | | | $ | 6,581,472 | | | | | $ | (634) | | |
| | | Preferred stock and paid-in capital | | | Common stock and paid-in capital | | | Distributions in excess of net income | | | Accumulated other comprehensive loss | | ||||||||||||
Issuance of Realty Income common stock(a) | | | | $ | — | | | | | $ | 5,873,617 | | | | | $ | — | | | | | $ | — | | |
Issuance of Realty Income Series A preferred stock(b) | | | | | 164,220 | | | | | | — | | | | | | — | | | | | | — | | |
Settlement of Spirit’s equity-based awards(c) | | | | | — | | | | | | 22,069 | | | | | | (22,069) | | | | | | — | | |
Spirit transaction-related costs(d) | | | | | — | | | | | | — | | | | | | (58,000) | | | | | | — | | |
Elimination of Spirit’s historical equity balances(e) | | | | | (166,177) | | | | | | (7,307,795) | | | | | | 3,094,475 | | | | | | (55,296) | | |
| | | Preferred stock and paid-in capital | | | Common stock and paid-in capital | | | Distributions in excess of net income | | | Accumulated other comprehensive loss | | ||||||||||||
Realty Income transaction-related costs(f) | | | | | — | | | | | | — | | | | | | (60,000) | | | | | | — | | |
Total pro forma adjustment | | | | $ | (1,957) | | | | | $ | (1,412,109) | | | | | $ | 2,954,406 | | | | | $ | (55,296) | | |
|
| | | Elimination of historical amounts(a) | | | Recognition of post-combination amounts | | | Total pro forma adjustment | | |||||||||
For the three months ended March 31, 2021 | | | | | | | | | | | | | | | | | | | |
Straight-line rents | | | | $ | (4,470) | | | | | $ | 16,737 | | | | | $ | 12,267 | | |
Amortization of above-market and below-market lease intangibles | | | | | 1,537 | | | | | | 4,656 | | | | | | 6,193 | | |
Total pro forma adjustment | | | | $ | (2,933) | | | | | $ | 21,393 | | | | | $ | 18,460 | | |
For the year ended December 31, 2020 | | | | | | | | | | | | | | | | | | | |
Straight-line rents | | | | $ | (23,149) | | | | | $ | 59,908 | | | | | $ | 36,759 | | |
Amortization of above-market and below-market lease intangibles | | | | | 2,777 | | | | | | 18,625 | | | | | | 21,402 | | |
Total pro forma adjustment | | | | $ | (20,372) | | | | | $ | 78,533 | | | | | $ | 58,161 | | |
| | | Elimination of historical amounts | | | Recognition of post-combination amounts(a) | | | Total pro forma adjustment | | |||||||||
For the nine months ended September 30, 2023 | | | | | | | | | | | | | | | | | | | |
Straight-line rent, net | | | | $ | (26,127) | | | | | $ | 35,555 | | | | | $ | 9,428 | | |
Amortization of above-market and below-market lease intangibles and deferred lease incentives, net | | | | | (767) | | | | | | 15,583 | | | | | | 14,816 | | |
Total pro forma adjustment | | | | $ | (26,894) | | | | | $ | 51,138 | | | | | $ | 24,244 | | |
For the year ended December 31, 2022 | | | | | | | | | | | | | | | | | | | |
Straight-line rent, net | | | | $ | (36,902) | | | | | $ | 55,090 | | | | | $ | 18,188 | | |
Amortization of above-market and below-market lease intangibles and deferred lease incentives, net | | | | | (2,190) | | | | | | 20,777 | | | | | | 18,587 | | |
Total pro forma adjustment | | | | $ | (39,092) | | | | | $ | 75,867 | | | | | $ | 36,775 | | |
| | For the three months ended March 31, 2021 | | For the year ended December 31, 2020 | | | For the nine months ended September 30, 2023 | | For the year ended December 31, 2022 | | ||||||||||||||||
Buildings and improvements | | | $ | 99,405 | | | | $ | 397,618 | | | | | $ | 150,215 | | | | $ | 200,286 | | | ||||
Tenant improvements | | | | 31,095 | | | | | 124,379 | | | | | | 23,957 | | | | | 31,943 | | | ||||
In-place leases and leasing commissions and marketing costs | | | | 72,167 | | | | | 288,667 | | | | | | 77,535 | | | | | 103,379 | | | ||||
Less: Elimination of historical depreciation and amortization | | | | (106,878) | | | | | (435,366) | | | | | | (236,527) | | | | | (292,985) | | | ||||
Total pro forma adjustment | | | $ | 95,789 | | | | $ | 375,298 | | | | | $ | 15,180 | | | | $ | 42,623 | | |
| | | For the three months ended March 31, 2021 | | | For the year ended December 31, 2020 | | ||||||
Elimination of historical deferred financing costs amortization | | | | $ | (2,555) | | | | | $ | (15,114) | | |
Elimination of historical amortization of net (discounts)/premiums | | | | | (248) | | | | | | 1,650 | | |
Amortization of the fair value adjustment on mortgages and notes payable | | | | | (12,388) | | | | | | (49,552) | | |
Total pro forma adjustment | | | | $ | (15,191) | | | | | $ | (63,016) | | |
| | | For the nine months ended September 30, 2023 | | | For the year ended December 31, 2022 | | ||||||
Elimination of Spirit historical deferred financing costs amortization | | | | $ | (5,944) | | | | | $ | (5,410) | | |
Elimination of Spirit historical amortization of net discounts | | | | | (982) | | | | | | (1,269) | | |
Amortization of the fair value adjustment on swap assets, term loan, mortgages and notes payable | | | | | 69,992 | | | | | | 93,322 | | |
Total pro forma adjustment | | | | $ | 63,066 | | | | | $ | 86,643 | | |
| | | For the nine months ended September 30, 2023 | | | For the year ended December 31, 2022 | | ||||||
Numerator | | | | | | | | | | | | | |
Pro forma net income available to common stockholders | | | | $ | 782,101 | | | | | $ | 971,535 | | |
Denominator | | | | | | | | | | | | | |
Realty Income historical weighted average common shares outstanding | | | | | 681,419 | | | | | | 611,766 | | |
Spirit’s common stock converted into Realty Income common stock (141,331 shares and units outstanding, multiplied by the Exchange Ratio of 0.762) | | | | | 107,694 | | | | | | 107,694 | | |
Spirit’s performance share awards converted into Realty Income common stock (921 shares and units outstanding, multiplied by the Exchange Ratio of 0.762) | | | | | 702 | | | | | | 702 | | |
Pro forma weighted average common shares outstanding – basic | | | | | 789,815 | | | | | | 720,162 | | |
Realty Income historical weighted average dilutive shares | | | | | 710 | | | | | | 415 | | |
Pro forma weighted average Realty Income common shares outstanding – diluted | | | | | 790,525 | | | | | | 720,577 | | |
Pro forma amounts of net income available to common stockholders per common share: | | | | | | | | | | | | | |
Basic and diluted | | | | $ | 0.99 | | | | | $ | 1.35 | | |
| | | For the three months ended March 31, 2021 | | | For the year ended December 31, 2020 | | ||||||
Numerator | | | | | | | | | | | | | |
Pro forma income from continuing operations available to common stockholders | | | | $ | 149,565 | | | | | $ | 245,240 | | |
Denominator | | | | | | | | | | | | | |
Realty Income historical weighted average common shares outstanding | | | | | 371,522,607 | | | | | | 345,280,126 | | |
VEREIT common stock and VEREIT OP common units converted into Realty Income common stock (229,281,987 shares and units outstanding, multiplied by the Exchange Ratio of 0.705) | | | | | 161,643,801 | | | | | | 161,643,801 | | |
VEREIT DSU Awards converted into Realty Income common stock (113,868 units, multiplied by the Exchange Ratio of 0.705) | | | | | 80,277 | | | | | | 80,277 | | |
Pro forma weighted average common shares outstanding – basic | | | | | 533,246,685 | | | | | | 507,004,204 | | |
Realty Income historical weighted average dilutive shares | | | | | 79,294 | | | | | | 135,132 | | |
Unvested VEREIT equity-based awards exchanged into Realty Income equity-based awards | | | | | 517,124 | | | | | | 588,943 | | |
Pro forma weighted average common shares outstanding – diluted | | | | | 533,843,103 | | | | | | 507,728,279 | | |
Pro forma income from continuing operations available to common stockholders per common share: | | | | | | | | | | | | | |
Basic and diluted | | | | $ | 0.28 | | | | | $ | 0.48 | | |
Name of Beneficial Owner | | | Number of Shares Beneficially Owned | | | Percentage of All Shares(1) | | ||||||
Greater than 5% Stockholders | | | | | | | | | | | | | |
The Vanguard Group(2) | | | | | 20,472,067 | | | | | | 14.46% | | |
BlackRock, Inc.(3) | | | | | 18,071,384 | | | | | | 12.77% | | |
Cohen & Steers, Inc. and affiliates(4) | | | | | 16,327,751 | | | | | | 11.53% | | |
FMR LLC(5) | | | | | 9,989,957 | | | | | | 7.06% | | |
State Street Corporation(6) | | | | | 7,714,714 | | | | | | 5.45% | | |
Directors and Executive Officers(7) | | | | | | | | | | | | | |
Jackson Hsieh(8) | | | | | 595,913 | | | | | | * | | |
Michael Hughes(9) | | | | | 88,402 | | | | | | * | | |
Ken Heimlich | | | | | 73,059 | | | | | | * | | |
Jay Young | | | | | 23,351 | | | | | | * | | |
Rochelle Thomas | | | | | 28,302 | | | | | | * | | |
Kevin Charlton | | | | | 32,184 | | | | | | * | | |
Elizabeth Frank | | | | | 19,335 | | | | | | * | | |
Michelle Frymire | | | | | 10,009 | | | | | | * | | |
Kristian Gathright | | | | | 17,826 | | | | | | * | | |
Richard Gilchrist | | | | | 50,560 | | | | | | * | | |
Diana Laing | | | | | 17,835 | | | | | | * | | |
Nicholas Shepherd | | | | | 27,881 | | | | | | * | | |
Thomas Sullivan | | | | | 13,303 | | | | | | * | | |
All Directors and Executive Officers as a Group (13 persons) | | | | | 997,960 | | | | | | * | | |
Name of Beneficial Owner | | | Number of Shares Beneficially Owned | | | Percentage of All Shares(1) | | ||||||
Greater than 5% Shareholders | | | | | | | | | | | | | |
The Vanguard Group(2) | | | | | 100,758,107 | | | | | | 13.9% | | |
BlackRock, Inc.(3) | | | | | 58,673,834 | | | | | | 8.1% | | |
State Street Corporation(4) | | | | | 50,254,953 | | | | | | 6.9% | | |
Cohen & Steers(5) | | | | | 39,059,120 | | | | | | 5.4% | | |
Directors and Executive Officers | | | | | | | | | | | | | |
Sumit Roy(6) | | | | | 253,338 | | | | | | * | | |
Christie B. Kelly(7) | | | | | 30,091 | | | | | | * | | |
Neil M. Abraham(8) | | | | | 41,630 | | | | | | * | | |
Michelle Bushore(9) | | | | | 14,640 | | | | | | * | | |
Mark E. Hagan(10) | | | | | 47,914 | | | | | | * | | |
Shannon Kehle(11) | | | | | 21,569 | | | | | | * | | |
Gregory Whyte | | | | | — | | | | | | * | | |
Michael D. McKee(12) | | | | | 165,500 | | | | | | * | | |
Priscilla Almodovar(13) | | | | | 14,333 | | | | | | * | | |
Jacqueline Brady(14) | | | | | 12,161 | | | | | | * | | |
A. Larry Chapman(15) | | | | | 14,757 | | | | | | * | | |
Reginald H. Gilyard(16) | | | | | 24,000 | | | | | | * | | |
Mary Hogan Preusse(17) | | | | | 24,291 | | | | | | * | | |
Priya Cherian Huskins(18) | | | | | 43,400 | | | | | | * | | |
Gerardo I. Lopez(19) | | | | | 24,000 | | | | | | * | | |
Ronald L. Merriman(20) | | | | | 30,075 | | | | | | * | | |
Gregory T. McLaughlin(21) | | | | | 31,886 | | | | | | * | | |
All Directors and Executive Officers as a Group (17 persons) | | | | | 793,585 | | | | | | 0.1% | | |
| | | Rights of Realty Income Stockholders | | | Rights of | |
Authorized Capital Stock or Shares of Beneficial Interest | | | Realty Income is authorized to issue an aggregate of | | | | |
| | | As of | | | As of |
| |||||||
Voting Rights | | | Each outstanding share of Realty Income common stock is entitled to one vote per share on all matters upon which common stockholders are entitled to vote. If a quorum exists, action on a | | | Subject to restrictions on ownership and transfer of Spirit common stock in the Spirit Articles (described further below), each outstanding share of Spirit common stock entitles the holder thereof to one vote on all | |
| | | Rights of Realty Income Stockholders | | | Rights of Spirit Stockholders | |
| | | matter is approved if the votes cast favoring the action exceed the votes cast opposing the action, except for (i) votes pertaining to revoking or terminating Realty | | | The Spirit Bylaws provide for the election of directors, |
| |||||||
Size of the Board of Directors | | | At any regular meeting or at any special meeting called for that purpose, a majority of Realty Income’s entire board of directors may establish, increase or decrease the number of As of the record date, the Realty Income board of directors consists of | | | Directors are elected | |
|
| | | Rights of Realty Income Stockholders | | | Rights of | |
| | The Realty Income Articles provide that subject to the rights of one or more classes or series of preferred stock of Realty Income (including the Realty Income Series A preferred stock) to elect or remove one or more directors, any Realty Income director, or Realty Income’s entire board of directors, may be removed from office at any time, but only “Cause” | | | Subject to the rights of holders of one or more classes or series of preferred stock to elect or remove one or more directors | ||
| |||||||
Filling Vacancies of Directors | | | Any vacancies on the Realty Income board of directors for any cause other than an increase in the number of directors can be filled by a majority of the remaining directors, even if the remaining directors do not constitute a quorum. Vacancies created through an increase in the number of directors may be filled by | | | Any vacancies on the | |
Charter Amendments | | | | | |
| | | Rights of Realty Income Stockholders | | | Rights of | | |||
| | | | | generally be amended only if such amendment | | ||||
Bylaw Amendments | | | The Realty Income board of directors has the power to adopt, applicable law. | | | The | | |||
Vote on Merger, Consolidations or Sales of Substantially All Assets | | | The MGCL provides that a | | | The MGCL provides that a | |
| | | Rights of Realty Income Stockholders | | | Rights of | |
| | | |||||
Notwithstanding any provision of law permitting or requiring any action to be taken or authorized by the affirmative vote of the holders of a greater number of votes, the Realty Income Articles provide that any such action | | | Notwithstanding any provision of law permitting or requiring any action to be taken or authorized by the affirmative vote of the holders of a greater number of votes, the | | |||
Ownership Limitations | | | To maintain Realty Income’s status as a REIT under the Code, not more than 50% in value of the outstanding shares of Realty Income stock may be owned, actually or constructively, by or for five or fewer individuals (as defined in the Code to include certain entities) during the last half of a taxable year. Under the Realty Income Articles, with certain exceptions, the actual, constructive or | | | To maintain Spirit’s status as a REIT under the Code, not more than 50% in value of the outstanding shares of Spirit stock may be owned, actually or constructively, by or for five or fewer individuals (as defined in the Code to include certain entities) during the last half of a taxable year. Under the Spirit Articles, with certain exceptions, the actual, beneficial or constructive | |
| | | Rights of Realty Income Stockholders | | | Rights of Spirit Stockholders | |
| | | beneficial ownership by any person of more than 9.8% (by value or by number of shares, whichever is more restrictive) of the outstanding shares of Realty Income common stock or Realty Income Series A preferred stock, is generally prohibited. The Realty Income board of directors may, but in no event is required to, exempt from the ownership limit described in the preceding paragraph above, a particular stockholder if it determines that such ownership will not jeopardize Realty Income’s status as a REIT. As a condition of such exemption, the Realty Income board of directors may require a ruling from the Internal Revenue Service or an opinion of counsel satisfactory to it and/or undertakings or representations from the applicant with respect to preserving Realty Income’s REIT status. The Realty Income Articles further prohibit (1) any person from actually or constructively owning shares of Realty Income stock that would result in Realty Income being “closely held” under Section 856(h) of the Code or otherwise cause Realty Income to fail to qualify as a REIT, and (2) any person from transferring shares of Realty Income stock if such transfer would result in shares of our capital stock being beneficially owned by fewer than 100 persons (determined without reference to any rules of attribution). | | | ownership by any person of more than 9.8% | |
prohibited, in each case excluding any shares of Spirit stock that are not treated as outstanding for federal income tax purposes. The | |
| | | Rights of Realty Income Stockholders | | | Rights of | | |||
| | | | | | The The Spirit Articles further prohibit any person from actually, beneficially or constructively owning shares of Spirit stock, or the Spirit board of directors from making changes to the ownership limits, that could result in Spirit being “closely held” under the Code or otherwise cause Spirit to fail to qualify as a REIT (including, but not limited to, actual, beneficial or constructive ownership of shares of Spirit stock that could result in Spirit owning (actually or constructively) an interest in a tenant | |
| | | Rights of Realty Income Stockholders | | | Rights of | |
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| | | | Spirit stock being beneficially owned by fewer than 100 persons (determined without reference to any rules of | | ||
Advance Notice Provisions for Stockholder Nominations and Stockholder Business Proposals | | | The Realty Income Bylaws provide that, with respect to an annual meeting of stockholders, nominations of individuals for election to the Realty Income board of directors and the proposal of business to be considered by stockholders at the annual meeting may be made only: • pursuant to Realty Income’s notice of meeting; • by or at the direction of the Realty Income board of directors; or • upon timely and proper notice by a stockholder who is a stockholder of record at the record date for the annual meeting, at the time of giving of notice and In general, notice of stockholder nominations or business for an annual meeting must be delivered not earlier than the 150th day nor later than 5:00 p.m., Pacific Time, on the 120th day prior to the first anniversary of the date of the proxy statement for the preceding year’s annual | | | The • pursuant to • by or at the direction of the • • by or at the direction of the • provided that the meeting has been called in accordance with the Spirit Bylaws for the purpose of electing directors, by a stockholder that is a stockholder of record both at the time of giving of the | |
| | | Rights of Realty Income Stockholders | | | Rights of | |
| | | originally convened, or the 10th day following the day on which public announcement of the date of such meeting is first made. Notice of stockholder nominations for a special meeting must be delivered not earlier than the 120th day prior to the special meeting, and not later than 5:00 p.m., Pacific Time, on the later of the 90th day prior to the meeting or the 10th day following the day on which the public announcement is first made of the date of the | | | individual so nominated and that has complied with the advance notice provisions set forth in, and provided the information and certifications required by, the Spirit Bylaws. In general, Spirit must receive notice of a stockholder’s intention to make a nomination or to propose an item of business for the annual stockholders’ meeting not earlier than the 150th day and not later than the 120th day prior to the first anniversary of the date the proxy statement for the previous annual stockholders’ meeting was released to stockholders; provided, however, that if Spirit holds its annual stockholders’ meeting more than 30 days before or after the one-year anniversary date of the previous annual stockholders’ meeting, Spirit must receive the notice not earlier than the 150th day and not later than the 120th day prior to the annual stockholders’ meeting date or the tenth day following the date on which Spirit first publicly announces the date of the annual stockholders’ meeting, whichever occurs later. Notice of stockholder nominations for a special meeting must be | |
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State Anti-Takeover Statutes | | | Under the MGCL, certain “business combinations” (which include a merger, consolidation, share exchange and certain transfers, issuances or reclassifications of equity securities) between a Maryland corporation and any person who beneficially owns 10% or more of the voting power of the corporation’s outstanding voting stock, or an affiliate or associate of the corporation who beneficially owned 10% or more of the voting power of the corporation’s then outstanding stock at any time within the preceding two years, in each case referred to as an “interested stockholder,” or an affiliate thereof, are prohibited for five years after the most recent date on which the interested stockholder becomes an interested stockholder. Thereafter, any such business combination must be recommended by the board of directors and approved by the affirmative vote of at least (i) 80% of the votes entitled to be cast by holders of outstanding shares of voting stock of the corporation and (ii) two-thirds of the votes entitled to be cast by holders of voting stock of the corporation other than shares held by the interested stockholder or its affiliates or associates. The super-majority vote requirements do not apply, however, to business combinations that are approved or exempted by the board of directors prior to the time that the interested stockholder becomes an interested stockholder or if the business combination satisfies certain minimum price, form of consideration and procedural requirements. To date, Realty Income has not opted out of the business combination provisions of the MGCL. | | | Under the MGCL, certain “business combinations” (which include a merger, consolidation, share exchange and certain transfers, issuances or reclassifications of equity securities) between a Maryland corporation and any person who beneficially owns |
corporation other than shares held by the interested stockholder or its affiliates or associates. The super-majority vote requirements do not apply, however, to business combinations that are approved or exempted by the board of directors prior to the time that the interested stockholder becomes an interested stockholder or if the business combination satisfies certain minimum price, form of consideration and procedural requirements. | |
| | | Rights of Realty Income Stockholders | | | Rights of Spirit Stockholders | |
| | | As permitted by the MGCL, the Realty Income Bylaws contain a provision exempting from the control share acquisition statute all shares of Realty Income capital stock to the fullest extent permitted by the MGCL. See Subtitle 8 of Title 3 of the MGCL permits a Maryland corporation with a class of equity securities registered under the Exchange Act and at least three independent directors to elect to be subject, by provision in its charter or bylaws or a resolution of its board of directors and notwithstanding any contrary provision in the charter or bylaws, to any or all of the following five provisions: • a classified board; • a two-thirds stockholder vote requirement for removing a director; • a requirement that the number of directors be fixed only by vote of the directors; • a requirement that a vacancy on the board be filled only by the remaining directors and for the remainder of the full term of the class of directors in which the vacancy occurred; and • a requirement that To date, Realty Income has not made any of the elections described above, although, independent of these elections, the Realty Income Articles and Realty Income Bylaws contain provisions that directors may be | | | As permitted by the MGCL, the Subtitle 8 of Title 3 of the MGCL permits a Maryland corporation with a class of equity securities registered under the Exchange Act and at least three independent directors to elect to be subject, by provision in its charter or bylaws or a resolution of its board of directors and notwithstanding any contrary provision in the charter or bylaws, to any or all of the following five provisions: • a classified board; • a two-thirds stockholder vote requirement for removing a director; • a requirement that the number of directors be fixed only by vote of the directors; • a requirement that a vacancy on the board be filled only by the remaining directors and for the remainder of the full term of the class of directors in which the vacancy occurred; and • a requirement that The Spirit Articles contain a provision whereby Spirit has elected, at such time Spirit became eligible to do so, to be subject to the provisions of Subtitle 8 relating to filling vacancies on the Spirit board of directors only by the remaining directors. The Spirit board of directors has further adopted a resolution prohibiting Spirit from electing to be subject to the | |
| | | Rights of Realty Income Stockholders | | | Rights of | | |||
| | | | | provisions of Subtitle 8 relating to a classified board unless such election is approved by Spirit stockholders by the affirmative vote of a majority of all the votes entitled to be cast on the matter. | | ||||
Liability and Indemnification of Officers and Directors | | | The | | | The Spirit has also entered into indemnification agreements with its directors and executive officers, | |
| | | Rights of Realty Income Stockholders | | | Rights of | |
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| | provide indemnification to the maximum extent permitted by the MGCL. | | ||||
| | | Realty Income has purchased directors’ and officers’ liability insurance for the benefit of its directors and officers. | | | | |
Stockholder Rights Plan | | | Realty Income does not have a stockholder rights plan in effect. | | | | |
Dissenters’ Rights | | | The MGCL provides that a stockholder of a corporation is generally entitled to receive payment of the fair value of However, dissenters’ rights generally are not available to holders of shares, such as shares of Realty Income common stock, that are registered on a national securities exchange The Realty Income Articles do not include such charter provisions, but do reserve the right to make any amendment to the Realty Income Articles, now or hereafter authorized by law, including any amendment altering the terms or contract rights, as expressly set forth in the Realty Income Articles, of any shares of outstanding stock. | | | The MGCL provides that a stockholder of a corporation is generally entitled to receive payment of the fair value of However, dissenters’ rights generally are not available to holders of shares, such as shares of The | |
| | | Rights of Realty Income Stockholders | | | Rights of | |
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REIT Qualification | | | The Realty Income Articles provide that the Realty Income board of directors may revoke or otherwise terminate Realty Income’s REIT election, with the approval of the holders of at least two-thirds of all votes entitled to be cast on the matter, if it determines that it is no longer in Realty Income’s best interests to continue to qualify as a REIT. | | | The | |
Exclusive Forum Provision | | | The Realty Income Bylaws provide that, unless Realty Income consents in writing to the selection of an alternative forum, any state court of competent jurisdiction in Maryland, or, if such state courts do not have jurisdiction, the United States District Court located in the State of Maryland, will be the sole and exclusive forum for (a) any derivative action or proceeding brought on Realty Income’s behalf (other than actions arising under federal securities laws), (b) any Internal Corporate Claim, as such term is defined in the MGCL, including, without limitation (i) any action asserting a claim based on an alleged breach of any duty owed by any of Realty Income’s directors, officers or other employees to Realty Income or to Realty Income’s stockholders, (ii) any action asserting a claim against Realty Income or any of its directors, officers or other employees arising pursuant to any provision of the MGCL, the Realty Income Articles | | | The | |
| | | Rights of Realty Income Stockholders | | | Rights of Spirit Stockholders | |
| | | Furthermore, the Realty Income Bylaws provide that, unless Realty Income consents in writing to the selection of an alternative forum, the federal district courts of the United States of America shall, to the fullest extent permitted by law, be the sole and exclusive forum for the resolution of any cause of action arising under the Securities Act. | | | | |
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Exhibit A | | | | | | | |
| ATTEST: | | | REALTY INCOME CORPORATION | |
| Michelle Bushore Executive Vice President, Chief Legal Officer, General Counsel and Secretary | | | By: Sumit Roy President and Chief Executive Officer | |
REALTY INCOME CORPORATION By: /s/ Michelle Bushore Michelle Bushore Executive Vice-President, Chief Legal Officer, General Counsel and Secretary |
| Signature | | | Title | | | Date | |
| Sumit Roy | | | President, Chief Executive Officer and Director (Principal Executive Officer) | | | | |
| Christie B. Kelly | | | Executive Vice President, Chief Financial Officer and Treasurer (Principal Financial Officer) | | | | |
| Sean P. Nugent | | | Senior Vice President and Controller | | | | |
| | | | Director | | | | |
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Jacqueline Brady | | | Director | | | | ||
| * A. Larry Chapman | | | Director | | | December 15, 2023 | |
| Signature | | | Title | | | Date | |
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Reginald H. Gilyard | | | Director | | | | ||
| Mary Hogan Preusse | | | Director | | | December 15, 2023 | |
| * Priya Cherian Huskins | | | Director | | | | |
| Gerardo I. Lopez | | | Director | | | December 15, 2023 | |
| * Michael D. McKee | | | Non-Executive Chairman | | | December 15, 2023 | |
| * Gregory T. McLaughlin | | | Director | | | | |
| Ronald L. Merriman | | | Director | | | | |
| *By: /s/ Michelle Bushore Michelle Bushore, Attorney-in-Fact | | | |