SAN
DIEGO, Dec. 19, 2023 /PRNewswire/ -- Realty
Income Corporation (Realty Income, NYSE: O), The Monthly Dividend
Company®, today announced the commencement of offers to
exchange all validly tendered and accepted notes of the following
series issued by Spirit Realty, L.P. ("Spirit"), for notes to be
issued by Realty Income as described below (collectively, the
"Realty Notes"). A Registration Statement on Form S-4 (the
"Registration Statement") relating to the issuance of the Realty
Notes was filed with the U.S. Securities and Exchange Commission
("SEC") on December 19, 2023, but has not yet been declared
effective.
- 4.450% Notes due 2026 issued by Spirit for up to an aggregate
principal amount of $300 million of
new 4.450% Notes due 2026 issued by Realty Income;
- 3.200% Notes due 2027 issued by Spirit for up to an aggregate
principal amount of $300 million of
new 3.200% Notes due 2027 issued by Realty Income;
- 2.100% Notes due 2028 issued by Spirit for up to an aggregate
principal amount of $450 million of
new 2.100% Notes due 2028 issued by Realty Income;
- 4.000% Notes due 2029 issued by Spirit for up to an aggregate
principal amount of $400 million of
new 4.000% Notes due 2029 issued by Realty Income;
- 3.400% Notes due 2030 issued by Spirit for up to an aggregate
principal amount of $500 million of
new 3.400% Notes due 2030 issued by Realty Income;
- 3.200% Notes due 2031 issued by Spirit for up to an aggregate
principal amount of $450 million of
new 3.200% Notes due 2031 issued by Realty Income;
- 2.700% Notes due 2032 issued by Spirit for up to an aggregate
principal amount of $350 million of
new 2.700% Notes due 2032 issued by Realty Income.
The following table sets forth the Exchange Consideration (as
defined herein), Early Participation Premium (as defined herein)
and Total Consideration (as defined herein) for each series of
Spirit Notes (as defined herein):
|
|
|
|
|
|
|
|
Exchange
Consideration(1)
|
|
Early
Participation
Premium(1)
|
|
Total
Consideration(1)(2)
|
Aggregate
Principal
Amount
($mm)
|
|
Series of Notes
Issued by Spirit to
be Exchanged
(Collectively, the
"Spirit Notes")
|
|
CUSIP No.
|
|
Series of Notes to be
Issued by Realty
Income
|
|
Realty
Notes
(principal
amount)
|
|
Cash
|
|
Realty Notes
(principal
amount)
|
|
Realty Notes
(principal
amount)
|
|
Cash
|
$300
|
|
4.450% Notes due
2026
|
|
84861TAC2
|
|
4.450% Notes due
2026
|
|
$970
|
|
$1.00
|
|
$30
|
|
$1,000
|
|
$1.00
|
$300
|
|
3.200% Notes due
2027
|
|
84861TAE8
|
|
3.200% Notes due
2027
|
|
$970
|
|
$1.00
|
|
$30
|
|
$1,000
|
|
$1.00
|
$450
|
|
2.100% Notes due
2028
|
|
84861TAH1
|
|
2.100% Notes due
2028
|
|
$970
|
|
$1.00
|
|
$30
|
|
$1,000
|
|
$1.00
|
$400
|
|
4.000% Notes due
2029
|
|
84861TAD0
|
|
4.000% Notes due
2029
|
|
$970
|
|
$1.00
|
|
$30
|
|
$1,000
|
|
$1.00
|
$500
|
|
3.400% Notes due
2030
|
|
84861TAF5
|
|
3.400% Notes due
2030
|
|
$970
|
|
$1.00
|
|
$30
|
|
$1,000
|
|
$1.00
|
$450
|
|
3.200% Notes due
2031
|
|
84861TAG3
|
|
3.200% Notes due
2031
|
|
$970
|
|
$1.00
|
|
$30
|
|
$1,000
|
|
$1.00
|
$350
|
|
2.700% Notes due
2032
|
|
84861TAJ7
|
|
2.700% Notes due
2032
|
|
$970
|
|
$1.00
|
|
$30
|
|
$1,000
|
|
$1.00
|
|
|
|
|
|
|
|
|
|
|
|
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|
|
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(1)
|
Consideration per
$1,000 principal amount of Spirit Notes validly tendered, subject
to any rounding as described in the Registration
Statement.
|
|
|
(2)
|
Includes the Early
Participation Premium for Spirit Notes validly tendered prior to
the Early Consent Date described below and not
validly withdrawn.
|
In connection with the exchange offers, Realty Income is also
soliciting consents from holders of the Spirit Notes to amend the
indenture governing the Spirit Notes to eliminate substantially all
of the restrictive covenants in the indenture (the "Proposed
Amendments"). If the Proposed Amendments are adopted, the Spirit
Notes will be governed by the amended indenture. Holders of the
Spirit Notes under the amended indenture will no longer receive
annual, quarterly and other reports from Spirit, and will no longer
be entitled to the benefits of various covenants and other
provisions in the indenture and certain other provisions.
The exchange offers and consent solicitations (together, the
"Exchange Offers") commenced on December 19,
2023 and expire immediately following 5:00 p.m., New York
City time, on January 19,
2024, unless extended or terminated (the "Expiration Date").
In exchange for each $1,000 principal
amount of the Spirit Notes that is validly tendered prior to
5:00 p.m., New York City time, on January 10, 2024 (the "Early Consent Date") and
not validly withdrawn, holders will receive the total exchange
consideration set forth in the table above (the "Total
Consideration"), which consists of $1,000 principal amount of the Realty Notes and a
cash amount of $1.00. The Total
Consideration includes the early participation premium set out in
the table above (the "Early Participation Premium"), which consists
of $30 principal amount of Realty
Notes. In exchange for each $1,000
principal amount of the Spirit Notes that is validly tendered after
the Early Consent Date but prior to the Expiration Date and not
validly withdrawn, holders will receive only the exchange
consideration set out in the table above (the "Exchange
Consideration"), which is equal to the Total Consideration less the
Early Participation Premium and so consists of $970 principal amount of the Realty Notes and a
cash amount of $1.00.
Each Realty Note will have the same maturity date, accrue
interest at the same annual interest rate, have the same interest
payment dates, and same redemption terms as the Spirit Note for
which it is exchanged. Each Realty Note received in exchange for
the corresponding Spirit Note will accrue interest from (and
including) the most recent date to which interest has been paid on
such Spirit Note; provided, that interest will only accrue with
respect to the aggregate principal amount of the Realty Note
received, which may be less than the principal amount of the Spirit
Note tendered for exchange. Except as otherwise set forth in the
Prospectus (as defined below), payment will not be received for
accrued and unpaid interest on the Spirit Note exchanged at the
time of the exchange.
The Realty Notes will be senior unsecured obligations of Realty
Income and will rank equally in right of payment with all other
existing and future senior indebtedness of Realty Income. The
Realty Notes will be effectively subordinated in right of payment
to all of Realty Income's existing and future secured indebtedness
(to the extent of the value of the collateral securing such
indebtedness) and structurally subordinated to all obligations of
Realty Income's subsidiaries with respect to the assets of such
subsidiaries, other than any subsidiaries that may guarantee the
Realty Notes in the future.
The consummation of the Exchange Offers is subject to, and
conditional upon, the satisfaction or waiver (other than the waiver
of the condition requiring consummation of the Merger (as defined
in the Prospectus)) of the conditions set forth in Realty Income's
preliminary prospectus, dated as of December
19, 2023 (the "Prospectus"), including, among other things,
(i) the consummation of the Merger, which is currently expected to
close in the first quarter of 2024 subject to customary closing
conditions and (ii) receipt of valid consents to the proposed
amendments from the holders of at least a majority of the
outstanding aggregate principal amount of each series of the Spirit
Notes, voting as separate series. Tendered Spirit Notes may be
validly withdrawn at any time prior to the Expiration Date.
Consents to the Proposed Amendments may be revoked at any time
prior to the Early Consent Date, but may not be revoked at any time
thereafter. Realty Income may terminate or withdraw the
Exchange Offers at any time for any reason.
The closing of the Merger is not conditioned upon the completion
of the Exchange Offers.
The dealer manager for the Exchange Offers is:
Wells Fargo Securities, LLC
550 South
Tryon Street, 5th Floor
Charlotte, North Carolina
28202
Attention: Liability Management Group
Collect: (704) 410-4759
Toll Free: (866) 309-6316
Email: liabilitymanagement@wellsfargo.com
The exchange agent and information agent for the Exchange Offers
is:
D.F. King & Co., Inc.
48 Wall Street, 22nd Floor
New York, New York 10005
Bank and Brokers Call Collect: (212) 269-5550
All Others, Please Call Toll-Free: (866)
796-7184
Email: realtyincome@dfking.com
Requests for copies of the Prospectus can be made directly to
the exchange agent and information agent listed above.
This press release shall not constitute an offer to sell, or a
solicitation of an offer to buy, any of the securities described
herein and is also not a solicitation of the related consents. The
Exchange Offers may be made only pursuant to the terms and
conditions of the Prospectus and the other related materials. A
Registration Statement relating to the Realty Notes has been filed
with the SEC but has not yet become effective. The Realty Notes may
not be sold, nor may offers to buy be accepted, prior to the time
the Registration Statement is declared effective by the SEC.
About Realty Income
Realty Income, The Monthly
Dividend Company®, is an S&P 500 company and member
of the S&P 500 Dividend Aristocrats® index. We
invest in people and places to deliver dependable monthly dividends
that increase over time. The company is structured as a REIT, and
its monthly dividends are supported by the cash flow from over
13,250 real estate properties primarily owned under long-term net
lease agreements with commercial clients. To date, the company has
declared 642 consecutive common stock monthly dividends throughout
its 54-year operating history and increased the dividend 123 times
since Realty Income's public listing in 1994 (NYSE: O).
Forward-Looking Statements
This press release contains
forward-looking statements within the meaning of the Private
Securities Litigation Reform Act of 1995, Section 27A of the
Securities Act of 1933, as amended, and Section 21E of the Exchange
Act of 1934, as amended. When used in this press release, the words
"estimated," "anticipated," "expect," "believe," "intend,"
"continue," "should," "may," "likely," "plans," and similar
expressions are intended to identify forward-looking statements.
Forward-looking statements include discussions of Realty Income's
business and portfolio; strategy, plans, and the intentions of
management; and statements regarding the Exchange Offers and Merger
including the anticipated or projected impact of the Merger with
Spirit on its business, results of operations, financial condition
or prospects. Forward-looking statements are subject to risks,
uncertainties, and assumptions about us which may cause its actual
future results to differ materially from expected results. Some of
the factors that could cause actual results to differ materially
are, among others, its continued qualification as a real estate
investment trust; general domestic and foreign business, economic,
or financial conditions; competition; fluctuating interest and
currency rates; inflation and its impact on its clients and us;
access to debt and equity capital markets and other sources of
funding; continued volatility and uncertainty in the credit markets
and broader financial markets; other risks inherent in the real
estate business including its clients' defaults under leases,
increased client bankruptcies, potential liability relating to
environmental matters, illiquidity of real estate investments, and
potential damages from natural disasters; impairments in the value
of its real estate assets; changes in domestic and foreign income
tax laws and rates; its clients' solvency; property ownership
through joint ventures and partnerships which may limit control of
the underlying investments; current or future epidemics or
pandemics, measures taken to limit their spread, the impacts on
Realty Income, its business, its clients (including those in the
theater and fitness industries), and the economy generally; the
loss of key personnel; the outcome of any legal proceedings to
which Realty Income is a party or which may occur in the future;
acts of terrorism and war; the structure, timing and completion of
the announced merger between its subsidiary and Spirit and any
effects of the announcement, pendency or completion of the
announced merger with Spirit, including the anticipated benefits
therefrom; and those additional risks and factors discussed in its
reports filed with the SEC. Readers are cautioned not to place
undue reliance on forward-looking statements. Forward-looking
statements are not guarantees of future plans and performance and
speak only as of the date of this press release. Actual plans and
operating results may differ materially from what is expressed or
forecasted in this press release. Realty Income does not undertake
any obligation to update forward-looking statements or publicly
release the results of any forward-looking statements that may be
made to reflect events or circumstances after the date these
statements were made.
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SOURCE Realty Income Corporation