SECURITIES AND EXCHANGE COMMISSION
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CAPTEC NET LEASE REALTY, INC.
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(Name of Registrant as Specified in Its Charter)
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[CAPTEC LOGO]
NEWS RELEASE
For Immediate Release
CAPTEC SENDS LETTER TO STOCKHOLDERS
ANN ARBOR, Mich., October 30, 2001 - Captec Net Lease Realty Inc. (NASD: CRRR)
today announced that it mailed the following letter to all Captec stockholders
regarding the Company's proposed merger with Commercial Net Lease Realty, Inc.
(NYSE: NNN).
October 29, 2001
Dear Fellow Captec Stockholder:
There he goes again . . .
Dissident stockholder and consummate self-promoter Phillip Goldstein is
at it again. In another desperate effort to advance his own interests at
the expense of the truth and Captec stockholders, Mr. Goldstein is, for
the second straight year, attacking Captec's management and board of
directors. In a letter sent to Captec stockholders last week, he has
unleashed yet another baseless and vicious personal attack, this time
against our merger with Commercial Net Lease Realty, Inc. (CNLR). True
to form, he has offered no alternative plan. We believe that his
shameless self-promotion jeopardizes the value of your investment. Mr.
Goldstein can ignore and distort the truth, but he cannot change the
facts - our proposed merger with CNLR maximizes your investment in
Captec and is in the best interest of Captec stockholders.
LET'S SET THE RECORD STRAIGHT -- GOLDSTEIN OFFERS
NO PROPOSAL AND NO PLAN FOR CAPTEC STOCKHOLDERS
WHO IS PHIL GOLDSTEIN? Phil Goldstein is an amateur stockholder
dissident who has no experience in running or selling a public company.
We believe that Mr. Goldstein has no interest in creating long-term
value for Captec stockholders and that you should not trust him. We are
confident that Captec stockholders will recognize Phil Goldstein's
latest ploy for exactly what it is: a desperate effort to create a
platform for himself. We believe it is in your best interests to approve
the value-creating transaction with CNLR. Here are some plain-truth
facts that Mr. Goldstein hopes Captec stockholders will ignore:
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FACT: YOU CANNOT TRUST PHIL GOLDSTEIN. Mr. Goldstein's letter is
filled with personal attacks, half-truths and outright falsehoods.
Mr. Goldstein has a history of resorting to deceit in order to
advance his own agenda. Specifically, Mr. Goldstein posted on the
Internet a forged press release in the name of a mutual fund with
which he was engaged in a dispute. After he had been caught
red-handed and faced the threat of litigation, Mr. Goldstein was
forced to post a retraction. Other people may let Mr. Goldstein play
these kinds of games with their hard-earned money; you should not.
FACT: PHIL GOLDSTEIN IS OFFERING NOTHING TO CAPTEC STOCKHOLDERS. Mr.
Goldstein has not presented Captec stockholders with any
value-enhancing proposal. In fact, Mr. Goldstein's suggestions were
thoroughly evaluated by your board of directors and rejected as not
in the best interest of Captec stockholders.
FACT: PHIL GOLDSTEIN'S ACTIONS SPEAK LOUDER THAN HIS WORDS. In the
past year, Mr. Goldstein has amassed more than 300,000 Captec shares
with a current value of more than $3 million. What is especially
telling is that he continued to purchase Captec shares even after
the announcement of the CNLR merger. IGNORE WHAT MR. GOLDSTEIN SAYS
AND FOLLOW THE MONEY. Although Mr. Goldstein had previously
advocated the sale of our company, now that a transaction is in
hand, he suddenly opposes it. There may be a plan behind Mr.
Goldstein's schizophrenia, but it will not benefit Captec's
stockholders.
FACT: MR. GOLDSTEIN HAS BEEN INVITED TO MEET WITH CAPTEC MANAGEMENT
BUT HAS REFUSED. More than a year ago, Patrick Beach invited Mr.
Goldstein to meet with Captec management, but he declined.
Additionally, Mr. Goldstein chose not to participate in the process
that resulted in the sale of Captec. Having failed to take advantage
of these opportunities, Mr. Goldstein has no significant knowledge
of any Captec assets and the erroneous and irresponsible valuation
he attributed to Captec's non-real estate assets in his recent
letter is supported by nothing more than his imagination.
DO NOT SUPPORT GOLDSTEIN'S SELF-SERVING CAUSE
DO NOT ALLOW GOLDSTEIN TO DENY YOU
THE VALUE OF THE CNLR MERGER
YOUR BOARD OF DIRECTORS CONDUCTED A THOROUGH AND COMPLETE SALE PROCESS.
Your board of directors already considered Mr. Goldstein's "new ideas"
and examined a variety of strategic alternatives for Captec. The board
unanimously determined that a sale of Captec is the best alternative to
deliver superior and immediate value to Captec stockholders. A special
committee of independent Captec directors, together with its financial
advisor, UBS Warburg LLC, undertook an open sale process - a process
previously advocated by Mr. Goldstein - in which more than 50 companies
were invited to participate.
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CONTRARY TO MR. GOLDSTEIN'S SUGGESTION, ALL OF CAPTEC'S ASSETS WERE
OFFERED FOR SALE AND INCLUDED IN THE COMPREHENSIVE SALE PROCESS. In that
process, interested parties indicated that they were not willing to
acquire, or would offer only nominal value for, the non-real estate
assets. CNLR, the high bidder, was not willing to purchase these assets
as part of the transaction. No other participant in the sale process
submitted a bid for all of Captec that equaled the value to be received
by the Captec stockholders in the CNLR merger as currently structured.
YOUR BOARD OF DIRECTORS RECOMMENDS THAT ALL CAPTEC
STOCKHOLDERS SIGN, DATE AND RETURN THE ENCLOSED WHITE PROXY
CARD TODAY TO VOTE FOR THE PROPOSED MERGER
CAPTEC'S BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT YOU VOTE FOR THE
PROPOSED MERGER WITH CNLR. To vote your shares, please sign, date and
return the enclosed WHITE proxy card and mail it promptly in the
enclosed, self-addressed, stamped envelope. Your vote is extremely
important. Failure to vote your shares has the same effect as voting
against the merger. If you have any questions or require any assistance
in executing or delivering your proxy or voting instructions, please
call our proxy solicitor:
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GEORGESON SHAREHOLDER COMMUNICATIONS
TOLL FREE
1-800-223-2064
OUTSIDE THE U.S.
1-212-440-9800
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Thank you for your continued confidence and support.
On behalf of Captec's Board of Directors,
/s/ Edward G. Ptaszek
Edward G. Ptaszek
Secretary
Captec Net Lease Realty, Inc.
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ABOUT CAPTEC
Captec Net Lease Realty, Inc. is a real estate investment trust (REIT) that
invests in long-term net leased restaurant and retail properties. At June 30,
2001, Captec owned and/or managed a diversified portfolio of 229 freestanding
restaurant, retail and entertainment properties throughout the United States.
For more information about Captec toll-free via fax, dial 1-800-PRO-INFO or
1-800-776-4636, follow the voice menu prompts and enter the company code "CRRR"
or 2777 on any touch tone phone or visit the Captec web site at www.captec.com.
FORWARD-LOOKING STATEMENT
This communication contains certain "forward-looking statements" which represent
Captec's expectations or beliefs, including, but not limited to, statements
concerning industry performance and Captec's operations, performance, financial
condition, plans, growth and strategies. Any statements contained in this
communication that are not statements of historical fact may be deemed to be
forward-looking statements. Without limiting the generality of the foregoing,
words such as "may," "will," "expect," "anticipate," "intend," "could,"
"estimate" or "continue" or the negative or other variations thereof or
comparable terminology are intended to identify forward-looking statements.
These statements by their nature involve substantial risks and uncertainties,
certain of which are beyond Captec's control, and actual results may differ
materially depending on a variety of important factors, many of which are beyond
the control of Captec.
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INVESTORS / MEDIA CONTACT:
Matt Sherman
Joele Frank, Wilkinson Brimmer Katcher
(212) 355-4449