and structural repairs. Certain of the Company’s Properties are subject to leases under which the Company retains responsibility for certain costs and expenses associated with the Property. Because many of these certain Properties are recently constructed, management anticipates that capital demands to meet obligations with respect to these Properties will be modest for the foreseeable future and can be met with funds from operations and working capital. Management anticipates the costs associated with the Company’s vacant Properties or those Properties that become vacant will also be met with funds from operations and working capital. The Company may be required to use bank borrowings or other sources of capital in the event of unforeseen significant capital expenditures.
As of June 30, 2003, $95,800,000 was outstanding and approximately $129,200,000 was available for future borrowings under the Credit Facility. The Company expects to use the Credit Facility primarily to invest in the acquisition and development of freestanding properties generally leased to established corporate tenants, either directly or through investment interests.
Pursuant to the 2000 Plan, in June 2003, the Company granted and issued 6,000 shares of restricted common stock to certain directors of the Company. The restricted stock issued to the directors vests in equal amounts each year over approximately a two-year period ending on January 1, 2005 and automatically upon a change in control in the Company.
In May 2003, the Company filed a shelf registration statement with the Securities and Exchange Commission, which permits the issuance by the Company of up to $600,000,000 in debt and equity securities (which includes approximately $89,637,000 of unissued debt and equity securities under the Company’s previous $200,000,000 shelf registration statement).
In July 2003, the Company issued 5,600,000 shares of common stock and received gross proceeds of $100,800,000. In addition, the Company has granted the underwriters an over-allotment option to purchase up to 840,000 additional shares of common stock. In connection with this offering, the Company incurred stock issuance costs totaling approximately $5,266,000, consisting primarily of underwriters’ commissions and fees, legal and accounting fees and printing expenses. Net proceeds from the offering will be used to fund a portion of the purchase price for two office buildings and a related parking garage in the Washington, D.C. metropolitan area.
Liquidity and Capital Resources - continued:
Property Acquisitions and Commitments. On August 1, 2003, the Company acquired two office buildings and a related parking garage located in Arlington, Virginia (the Washington, D.C. metropolitan area) for $142,800,000. The Company used the net proceeds from the common stock offering to fund a portion of the purchase price. The remaining portion of the purchase price was funded through borrowings under the Company’s Credit Facility. In addition, the Company will fund an additional $28,900,000 for building and tenant improvements, and other costs related to the lease which will be funded through borrowings under the Company’s Credit Facility. The properties include two office buildings containing an aggregate of 541,000 rentable square feet (492,000 usable square feet for purposes of calculating rent) and a two-level garage with 1,079 parking spaces.
Investment in Unconsolidated Affiliates. In January 2003, the Company modified an existing secured revolving line of credit and security agreement with a wholly-owned subsidiary of Commercial Net Lease Realty Services, Inc. (“Services”) to increase the borrowing capacity from $5,000,000 to $15,000,000. In addition, the Company terminated an $11,000,000 secured revolving line of credit and security agreement with another wholly-owned subsidiary of Services. In May 2003, the Company modified an existing secured revolving line of credit and security agreement with a wholly-owned subsidiary of Services to increase the borrowing capacity from $15,000,000 to $45,000,000. In addition, the Company modified the existing secured revolving line of credit and existing security agreement with Services to decrease the borrowing capacity from $85,000,000 to $35,000,000. As of June 30, 2003, the secured revolving lines of credit and security agreements with Services and its wholly-owned subsidiaries provide for an aggregate borrowing capacity of $150,000,000. As of June 30, 2003, the aggregate outstanding balance of the secured revolving lines of credit and security agreements with Services and its wholly-owned subsidiaries was $71,799,000, resulting in $78,201,000 available for future borrowings under the line of credit.
Dividends. One of the Company’s primary objectives, consistent with its policy of retaining sufficient cash for reserves and working capital purposes and maintaining its status as a real estate investment trust, is to distribute a substantial portion of its funds available from operations to its common stockholders in the form of dividends. For the six months ended June 30, 2003 and 2002, the Company declared and paid dividends to its common stockholders of $25,884,000 and $25,339,000, respectively, or $0.64 and $0.63 per share of common stock, respectively. In July 2003, the Company declared dividends to its common shareholders of $14,787,000 or $0.320 per share of common stock, payable in August 2003.
Holders of the 9% Non-Voting Series A Preferred Stock issued in connection with the acquisition of Captec Net Lease Realty, Inc. (“Captec”) are entitled to receive, when and as authorized by the board of directors, cumulative preferential cash distributions at the rate of nine percent of the $25.00 liquidation preference per annum (equivalent to a fixed annual amount of $2.25 per share). For the six months ended June 30, 2003 and 2002, the Company declared and paid dividends to its preferred stockholders of $2,003,000 and $2,005,000, respectively, or $0.5625 per share of preferred stock.
Results of Operations
As of June 30, 2003 and 2002, the Company owned 340 and 346 Properties, respectively, 329 and 323, respectively, of which were leased generally to operators of established corporate tenants. During the six months ended June 30, 2003, the Company sold four properties with an aggregate gross leasable area of 33,000 square feet that were leased or partially leased during 2003. In addition, during the six months ended June 30, 2002, the Company sold five properties with an aggregate gross leasable area of 113,000 square feet that were leased or partially leased during 2002.
During the six months ended June 30, 2003 and 2002, the Company earned $44,279,000 and $41,182,000, respectively, in rental income from operating leases, earned income from direct financing leases and contingent rental income from continuing operations (collectively, “Rental Income”). The increase in Rental Income during the six months ended June 30, 2003, is attributable to a decrease in
20
Results of Operations - continued:
Rental Income related to (i) the Rental Income resulting from the increased occupancy rate of the Company’s portfolio from 93 percent at June 30, 2002 to 97 percent at June 30, 2003 and (ii) the additional Rental Income generated from the acquisition of ten Properties with an aggregate gross leasable area of 316,000 subsequent to June 30, 2002. The increase in Rental Income was partially offset by (i) the disposition of eight properties subsequent to June 30, 2002 that were leased or partially leased with an aggregate gross leasable area of 199,000 square feet, (ii) the termination of leases on two properties subsequent to June 30, 2002 and (iii) a decrease in non-recurring additional Rental Income received during the six months ended June 30, 2003 compared to the six months ended June 30, 2002. The Company recognized $1,900,000 and $2,067,000 of non-recurring additional Rental Income related to lease terminations during the six months ended June 30, 2003 and 2002, respectively.
During the quarter ended June 30, 2003 and 2002, the Company earned $21,909,000 and $20,414,000, respectively, in Rental Income. The increase in Rental Income during the quarter ended June 30, 2003, is primarily a result of (i) the Rental Income resulting from the increased occupancy rate of the Company’s portfolio from 93 percent at June 30, 2002 to 97 percent at June 30, 2003, (ii) the additional Rental Income generated from the acquisition of ten properties with an aggregate gross leasable area of 316,000 subsequent to June 30, 2002 and (iii) the increase in Rental Income from non-recurring additional Rental Income received during the quarter ended June 30, 2003 of $650,000, related to the termination of a lease on one property in comparison to $600,000 during the quarter ended June 30, 2002, related to the termination of a lease on one property. However, the increase in Rental Income was partially offset as a result of (i) the eight properties that were disposed of subsequent to June 30, 2002 that had an aggregate gross leasable area of 199,000 square feet and (ii) the termination of leases on two properties subsequent to June 30, 2002.
During the six months ended June 30, 2003 and 2002, the Company earned $2,107,000 and $3,881,000, respectively, in interest income from unconsolidated affiliates and other mortgages receivable, of which $1,363,000 and $1,639,000 was earned during the quarters ended June 30, 2003 and 2003, respectively. The decrease in interest earned from unconsolidated affiliates and other mortgages receivable was primarily attributable to a decrease in the average borrowing levels on the lines of credit with Services and its wholly-owned subsidiaries and a decline in the average interest rate on the lines of credit.
During the six months ended June 30, 2003 and 2002, operating expenses from continuing operations, including general operating and administrative, real estate and depreciation and amortization expenses but excluding interest and the expense incurred in connection with dissenting shareholders’ settlement, were $11,781,000 and $11,331,000, respectively, (24.7% and 24.7%, respectively, of total revenues), of which $5,955,000 and $5,795,000, respectively, (24.7% and 25.8%, respectively, of total revenues) were incurred during the quarters ended June 30, 2003 and 2002, respectively. The increase in the dollar amount of operating expenses for the quarter and six months ended June 30, 2003, as compared to the quarter and six months ended June 30, 2002, is primarily attributable to the increase in depreciation and amortization expense related to (i) the acquisition of and tenant improvements on additional Properties since June 30, 2002, and (ii) the increase in amortization of debt financing fees related to the $50,000,000 notes payable issued in June 2002, partial repayment of the term note in June 2002 and the amended Credit Facility. In addition, the increase is attributable to an increase in general operating and administrative expenses during the quarter ended June 30, 2003, as a result of increases in office expenses, taxes and expenses related to professional services provided to the Company. The increase in operating expenses is partially offset by a (i) decrease in real estate expenses as a result of the increased occupancy rate of the Company’s portfolio from 93 percent at June 30, 2002 to 97 percent at June 30, 2003, and (ii) a decrease in expenses related to personnel.
The Company recognized $13,347,000 and $12,973,000 in interest expense for the six months ended June 30, 2003 and 2002, respectively, of which $6,838,000 and $6,406,000 was incurred during the quarters ended June 30, 2003 and 2002, respectively. Interest expense increased during the quarter and six months ended June 30, 2003, as a result of (i) the $50,000,000 notes payable issued in June 2002 and (ii) the
21
Results of Operations - continued:
$21,000,000 fixed rate mortgage entered into in June 2002. However, the increase in interest expense was offset by a decrease in the average borrowing levels of the Company’s Credit Facility and the partial repayment of the term note payable in June 2002.
During the six months ended June 30, 2003, the Company recorded a non-recurring dissenting shareholders’ settlement expense of $2,413,000 related to the appraisal rights litigation disclosed in Item 3 of the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2002, that arose as a result of the merger with Captec Net Lease Realty, Inc. in December 2001. The Company entered into a settlement agreement dated as of February 7, 2003 with the beneficial owners of the alleged 1,037,946 dissenting shares (including the petitioners in the Appraisal Action) which required the Company to pay $15,569,000, which approximated the value of the original merger consideration (which included cash, common shares and preferred shares) at the time of the litigation settlement plus the dividends that would have been paid if the shares had been issued at the time of the merger. On February 13, 2003, the parties filed a stipulation and order of dismissal and the Court entered the order of dismissal, dismissing the Appraisal Action with prejudice.
During the six months ended June 30, 2003 and 2002, the Company recognized equity in earnings of unconsolidated affiliates of $1,955,000 and $1,777,000, respectively, of which $1,191,000 and $1,137,000 was recognized during the quarters ended June 30, 2003 and 2002, respectively. The increase in equity in earnings of unconsolidated affiliates was primarily attributable to the income generated from the investments in mortgage loans. However, the increase in equity in earnings from unconsolidated affiliates was partially offset by a decrease in the income generated by Services and its wholly-owned subsidiaries, which was attributable to the timing of real estate dispositions by Services and its subsidiaries.
In accordance with Statement of Financial Accounting Standard (“SFAS”) No. 144, “Accounting for the Impairment or Disposal of Long-Lived Assets,” the Company has classified the operations of the nine and 19 properties sold during 2003 and 2002, respectively, as discontinued operations. Accordingly, the results of operations for 2003 and 2002 related to these 28 properties have been reclassified to earnings from discontinued operations. During the six months ended June 30, 2003 and 2002, the Company recognized earnings from discontinued operations of $423,000 and $2,930,000, respectively, of which a loss of $148,000 and earnings of $2,145,000 was recognized during the quarters ended June 30, 2003 and 2002, respectively. The Company occasionally sells properties and may reinvest the proceeds of the sales to purchase new properties, the Company evaluates its ability to fund distributions to stockholders by considering the combined effect of income from continuing and discontinued operations.
During the six months ended June 30, 2003, the Company sold nine properties for net sales proceeds of $12,830,000 and recognized a net loss of $409,000 for financial reporting purposes. This loss is included in earnings from discontinued operations. The Company used the proceeds to pay down outstanding indebtedness of the Company’s Credit Facility.
During the six months ended June 30, 2002, the Company sold 12 properties for net sales proceeds of $21,430,000 and recognized a net gain of $859,000 for financial reporting purposes. This gain is included in earnings from discontinued operations. The Company reinvested the proceeds from three of these properties to acquire additional properties and structured the transactions to qualify as tax-free like-kind exchange transactions for federal income tax purposes. The Company used the remaining proceeds to pay down outstanding indebtedness of the Company’s Credit Facility.
During the quarter ended June 30, 2003, the Company sold two properties for net sales proceeds of $688,000 and recognized a net loss of $477,000 for financial reporting purposes. This loss is included in earnings from discontinued operations. The Company used the proceeds to pay down outstanding indebtedness of the Company’s Credit Facility.
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Results of Operations - continued:
During the quarter ended June 30, 2002, the Company sold nine properties for net sales proceeds of $17,817,000 and recognized a net gain of $768,000 for financial reporting purposes. This gain is included in earnings from discontinued operations. The Company reinvested the proceeds from three of these properties to acquire additional properties and structured the transactions to qualify as tax-free like-kind exchange transactions for federal income tax purposes. The Company used the remaining proceeds to pay down outstanding indebtedness of the Company’s Credit Facility.
Investment Considerations. As of July 2003, the Company owns eight vacant, unleased Properties, which accounts for three percent of the total gross leasable area of the Company’s portfolio; the Company is actively marketing these Properties for sale or re-lease. Additionally, three percent of the total gross leasable area of the Company’s portfolio is leased to four tenants that have each filed a voluntary petition for bankruptcy under Chapter 11 of the U.S. Bankruptcy Code. As a result, each of the tenants has the right to reject or affirm its leases with the Company. The lost revenues and increased property expenses resulting from the rejection by any bankrupt tenant of any of their respective leases with the Company could have a material adverse effect on the liquidity and results of operations of the Company if the Company is unable to re-lease the Properties at comparable rental rates and in a timely manner.
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ITEM 3.QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
There have been no material changes in quantitative and qualitative disclosures about market risk as previously reported in the Form 10-K for the year ended December 31, 2002.
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ITEM 4.CONTROLS AND PROCEDURES
The Company maintains a set of disclosure controls and procedures designed to ensure that information required to be disclosed in the Company’s filings under the Securities Exchange Act of 1934 is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms. The principal executive and financial officers of the Company have evaluated the Company’s disclosure controls and procedures as of the end of the period covered by this Quarterly Report on Form 10-Q and have determined that such disclosure controls and procedures are effective.
There was no change in internal control over financial reporting that occurred during the most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, internal control over financial reporting.
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PART II. OTHER INFORMATION
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| Item 1. | Legal Proceedings |
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| No material developments in legal proceedings as previously reported on the Form 10-K for the year ended December 31, 2002. |
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| Item 2. | Changes in Securities and Use of Proceeds. Not applicable. |
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| Item 3. | Defaults Upon Senior Securities. Not applicable. |
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| Item 4. | Submission of Matters to a Vote of Security Holders.
On May 30, 2003, the Company held its Annual Meeting of Stockholders (the“Annual Meeting”). At the Annual Meeting, three proposals were considered. |
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| | | First, the following nominees were elected to the Board of Directors of the Company: Messrs. Robert A. Bourne (34,21,668 for and 867,364 withheld), Kevin B. Habicht (34,219,058 for and 869,974 withheld), Clifford R. Hinkle (31,208,602 for and 3,880,429 withheld), Richard B. Jennings (34,790,611 for and 298,420 withheld), Ted B. Lanier (31,201,934 for and 3,887,097 withheld), Robert C. Legler (34,780,594 for and 308,437 withheld), Robert Martinez (31,181,364 for and 3,907,667 withheld), Gary M. Ralston (34,110,258 for and 978,774 withheld), and James M. Seneff, Jr. (34,071,703 for and 1,017,329 withheld).
Second, the 2003 Employee Stock Purchase Plan was approved (33,809,161 for, 900,746 against and 379,124 withheld).
Finally, other matters were approved (27,613,290 for, 6,930,309 against and 545,432 withheld). |
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| Item 5. | Other Information. Not applicable. |
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| Item 6. | Exhibits and Reports on Form 8-K. |
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| (a) | The following exhibits are filed as a part of this report. |
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| 3. | Articles of Incorporation and By-laws |
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| 3.1 | Articles of Incorporation of the Registrant (filed as Exhibit 3.3(i) to the Registrant’s Registration Statement No. 1-11290 on Form 8-B, and incorporated herein by reference). |
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| 3.2 | Bylaws of the Registrant, (filed as Exhibit 3(ii) to Amendment No. 2 to the Registrant’s Registration Statement No. 33-83110 on Form S-3, and incorporated herein by reference). |
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| 3.3 | Articles of Amendment to the Articles of Incorporation of the Registrant (filed as Exhibit 3.3 to the Registrant’s Form 10-Q for the quarter ended June 30, 1996, and incorporated herein by reference). |
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| 3.4 | Articles of Amendment to the Articles of Incorporation of the Registrant (filed as Exhibit 3.4 to the Registrant’s Current Report on Form 8-K dated February 18, 1998, and filed with the Securities and Exchange Commission on February 19, 1998, and incorporated herein by reference). |
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| 3.5 | First Amended and Restated Articles of Incorporation of the Registrant (filed as Exhibit 3.1 to the Registrant’s Registration Statement No. 333-64511 on Form S-3, and incorporated herein by reference). |
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| 3.6 | Articles of Amendment to the First Amended and Restated Articles of Incorporation of the Registrant (filed as Exhibit 3.6 to the Registrant’s Form 10-Q for the quarter ended June 30, 2002, and incorporated herein by reference). |
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| 4. | Instruments defining the rights of security holders, including indentures |
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| 4.1 | Specimen Certificate of Common Stock, par value $0.01 per share, of the Registrant (filed as Exhibit 3.4 to the Registrant’s Registration Statement No. 1-11290 on Form 8-B and incorporated herein by reference). |
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| 4.2 | Form of Indenture dated March 25, 1998, by and among Registrant and First Union National Bank, Trustee, relating to $100,000,00 of 7.125% Notes due 2008 (filed as Exhibit 4.1 to the Registrant’s Current Report on Form 8-K dated March 20, 1998, and incorporated herein by reference). |
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| 4.3 | Form of Supplement Indenture No. 1 dated March 25, 1998, by and among Registrant and First Union National Bank, Trustee, relating to $100,000,000 of 7.125% Notes due 2008 (filed as Exhibit 4.2 to the Registrant’s Current Report on Form 8-K dated March 20, 1998, and incorporated herein by reference). |
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| 4.4 | Form of 7.125% Note due 2008 (filed as Exhibit 4.3 to the Registrant’s Current Report on Form 8-K dated March 20, 1998, and incorporated herein by reference). |
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| 4.5 | Form of Supplemental Indenture No. 2 dated June 21, 1999, by and among Registrant and First Union National Bank, Trustee, relating to $100,000,000 of 8.125% Notes due 2004 (filed as Exhibit 4.2 to the Registrant’s Current Report on Form 8-K dated June 17, 1999, and incorporated herein by reference). |
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| 4.6 | Form of 8.125% Notes due 2004 (filed as Exhibit 4.3 to the Registrant’s Current Report on Form 8-K dated June 17, 1999, and incorporated herein by reference). |
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| 4.7 | Form of Supplemental Indenture No. 3 dated September 20, 2000, by and among Registrant and First Union National Bank, Trustee, relating to $20,000,000 of 8.5% Notes due 2010 (filed a |
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| | as Exhibit 4.2 to the Registrant’s Current Report on Form 8-K dated September 20, 2000, and incorporated herein by reference). |
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| 4.8 | Form of 8.5% Notes due 2010 (filed as Exhibit 4.3 to the Registrant’s Current Report on Form 8-K dated September 20, 2000, and incorporated herein by reference). |
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| 4.9 | Form of Supplement Indenture No. 4 dated May 30, 2002, by and among Registrant and Wachovia Bank, National Association, Trustee, relating to $50,000,000 of 7.75% Notes due 2012 (filed as Exhibit 4.2 to the Registrant’s Current Report on Form 8-K dated June 4, 2002, and incorporated herein by reference). |
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| 4.10 | Form of 7.75% Notes due 2012 (filed as Exhibit 4.3 to the Registrant’s Current Report on Form 8-K dated June 4, 2002 and incorporated herein by reference). |
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| | 10. | Material Contracts |
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| 10.1 | Letter Agreement dated July 10, 1992, amending Stock Purchase Agreement dated January 23, 1992 (filed as Exhibit 10.34 to the Registrant’s Quarterly Report on Form 10-Q for the quarter ended June 30, 1992, and incorporated herein by reference). |
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| 10.2 | Loan Agreement, dated January 19, 1996, among Registrant and Principal Mutual Life Insurance Company relating to a $39,450,000 loan (filed as Exhibit 10.12 to the Registrant’s Annual Report on Form 10-K for the year ended December 31, 1995, and incorporated herein by reference). |
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| 10.3 | Secured Promissory Note, dated January 19, 1996, among Registrant and Principal Mutual Life Insurance Company relating to a $39,450,000 loan (filed as Exhibit 10.13 to the Registrant’s Annual Report on Form 10-K for the year ended December 31, 1995, and incorporated herein by reference). |
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| 10.4 | Agreement and Plan of Merger dated May 15, 1997, by and among Commercial Net Lease Realty, Inc., Net Lease Realty II, Inc., CNL Realty Advisors, Inc. and the Stockholders of CNL Realty Advisors, Inc. (filed as Exhibit 10.1 to the Registrant’s Current Report on Form 8-K dated May 16, 1997, and incorporated herein by reference). |
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| 10.5 | 2000 Performance Incentive Plan (filed as Exhibit 99 to the Registrant’s Registration Statement No. 333-64794 on Form S-8 and incorporated herein by reference). |
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| 10.6 | Third Renewal Promissory Note dated as of April 1, 2001, by Commercial Net Lease Realty Services, Inc. in favor of Registrant relating to an $85,000,000 line of credit (filed as |
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| | Exhibit 10.13 to the Registrant’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2001, and incorporated herein by reference). |
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| 10.7 | Third Modification of Amended and Restated Secured Revolving Line of Credit and Security Agreement and Other Loan Documents effective as of April 1, 2001, by and between Registrant as lender and Commercial Net Lease Realty Services, Inc. as borrower, relating to an $85,000,000 line of credit (filed as Exhibit 10.14 to the Registrant’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2001, and incorporated herein by reference). |
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| 10.8 | Fourth Modification of Amended and Restated Secured Revolving Line of Credit and Security Agreement and Other Loan Documents effective as of July 1, 2001, by and between Registrant as lender and Commercial Net Lease Realty Services, Inc. as borrower, relating to an $85,000,000 line of credit (filed as Exhibit 10.15 to the Registrant’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2001, and incorporated herein by reference). |
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| 10.9 | Agreement and Plan of Merger, dated as of July 1, 2001, among Commercial Net Lease Realty, Inc. and Captec Net Lease Realty, Inc. (filed as Exhibit 99.1 to the Registrant’s Current Report on Form 8-K dated July 3, 2001, and incorporated herein by reference). |
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| 10.10 | Seventh Amended and Restated Line of Credit and Security Agreement, dated May 9, 2003, by and among Registrant, certain lenders and Wachovia Bank, N.A., as the Agent, relating to a $225,000,000 loan (filed as Exhibit 10.11 to the Registrant’s Current Report on Form 8-K dated July 11, 2003, and incorporated herein by reference |
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| 10.11 | Real Estate Purchase Contract, dated as of July 23, 2003, by and between MCI Worldcom Network Services, Inc. and the Company (filed as Exhibit 10.1 to the Registrant’s Current Report on Form 8-K dated July 25, 2003, and incorporated herein by reference |
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| 10.12 | U.S. Government Lease for Real Property, dated as of December 17, 20023, between MCI Worldcom Network Services, Inc. and the United States of America (filed as Exhibit 10.2 to the Registrant’s Current Report on Form 8-K dated July 25, 2003, and incorporated herein by reference |
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| | 31. | Section 302 Certifications |
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| 31.1 | Certification of Chief Executive Officer pursuant to Rule 13a-14, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 (filed herewith). |
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| 31.2 | Certification of Chief Financial Officer pursuant to Rule 13a-14, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 (filed herewith).
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| | 32. | Section 906 Certifications |
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| 32.1 | Certification of Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (filed herewith). |
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| 32.2 | Certification of Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (filed herewith). |
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| (b) | The Registrant filed one report on Form 8-K on May 6, 2003 for the purpose of filing under Items 7 (Financial Statements and Exhibits) and 12 (Results of Operations and Financial Condition) a press release announcing its results of operations and financial condition for the three months ended March 31, 2003. |
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| SIGNATURES |
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Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
DATED this 12th day of August, 2003.
COMMERCIAL NET LEASE REALTY, INC.
By: /s/Gary M. Ralston
Gary M. Ralston
President and Director
By: /s/Kevin B. Habicht
Kevin B. Habicht
Chief Financial Officer and Director |
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