SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 14A
(RULE 14a-101)
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PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE SECURITIES
EXCHANGE ACT OF 1934
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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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(Name of Person(s) Filing Proxy Statement if other than the Registrant)
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November 9, 2001
Dear Fellow Captec Stockholder:
Before deciding how to vote your shares at the upcoming Special Meeting of
Captec stockholders, you should know about recent developments regarding
dissident stockholder, Phil Goldstein, and his associates.
THERE IS NO HIGHER OFFER
Goldstein wants you to believe that there is an alternative offer to acquire
Captec.
TRUTH: There is no offer at all. As part of an effort to thwart Captec's merger
with CNLR, a crony of Goldstein's sent an unsigned letter to CNLR suggesting
that he may or may not pay ten cents more per share for Captec's non-real estate
assets subject to a variety of conditions. The letter was sent last week with a
copy to Goldstein.
GOLDSTEIN AND HIS ASSOCIATE
ATTEMPTED TO GREENMAIL CAPTEC AND CNLR
Goldstein wants you to believe that he is acting in the interests of all Captec
stockholders.
TRUTH: The only stockholder Phil Goldstein looks out for is Phil Goldstein. This
week, Goldstein called CNLR and offered to sell his Captec shares at the expense
of all other Captec stockholders. CNLR said no.
TRUTH: The same Goldstein crony who submitted the sham offer also offered to
sell his Captec voting rights back to the Company for $0.50 per share. We said
no.
TRUTH: For all his stockholder rights rhetoric, Goldstein is trying to cut a
deal for himself and cut you out. Say no. Vote FOR the merger.
LIQUIDATION IS NOT A VIABLE STRATEGY
Goldstein wants you to believe that liquidation would generate higher value for
Captec stockholders.
TRUTH: Liquidation is costly with no guarantee of higher value for stockholders.
Institutional Shareholder Services (ISS), the nation's leading independent proxy
advisory firm, in recommending that Captec stockholders vote for the CNLR
merger, noted that liquidation "... may not be the best strategy for a REIT that
owns retail properties."* ISS also noted that Burnham Pacific Properties,
another publicly-traded REIT, two years ago "rejected a $13.50 per share offer,
arguing that the company would be worth more in a liquidation of its assets. . .
but it appears that its shareholders are not close to realize $13.50 per share.
Burnham is currently trading at $4.94 and its liquidation is still ongoing."*
APPRAISAL RIGHTS COULD MEAN LESS VALUE FOR YOUR SHARES
Goldstein wants Captec stockholders to believe that exercising your appraisal
rights will yield higher value than the CNLR merger.
TRUTH: Pursuing appraisal rights is a costly and time-consuming process that
requires you to hire lawyers and experts and file a lawsuit in the state of
Delaware. During this process, you receive no value for your shares; you receive
no dividend; and ultimately, you run the risk of receiving LESS value than the
merger consideration.
THERE IS STILL TIME TO ACT
The Special Meeting is days away, scheduled for November 19, 2001. Your vote is
important - without it, we cannot create the combined CNLR-Captec. PLEASE VOTE
FOR THE MERGER ON THE WHITE PROXY CARD TODAY. Remember, failure to vote has the
same effect as voting against the merger.
WE URGE YOU NOT TO RETURN GOLDSTEIN'S GREEN PROXY CARD. If you have already
returned a Goldstein proxy, you can still change your vote by signing, dating
and returning a WHITE proxy card now. Only the latest-dated proxy will count.
You may fax your WHITE proxy card to 212-440-9009, attention: CAPTEC PROXY. For
assistance in voting your shares, please call Captec's proxy solicitor,
Georgeson Shareholder Communications, toll-free at 1-800-223-2064 or
212-440-9800 (outside the U.S.).
Sincerely,
On behalf of Captec's Board of Directors,
/s/ Edward G. Ptaszek
Edward G. Ptaszek
Secretary
Captec Net Lease Realty, Inc.
*Permission to use quotation was neither sought nor obtained.