This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

Realty Income And American Realty Capital Trust Announce Amended Merger Agreement

ESCONDIDO, Calif. and NEW YORK, Jan. 7, 2013 /PRNewswire/ --  Realty Income Corporation, the Monthly Dividend Company®, (NYSE: O) ("Realty Income") and American Realty Capital Trust, Inc., (NASDAQ: ARCT) ("ARCT") today announced that they have signed an amendment (the "Amendment") to the previously announced definitive merger agreement (the "Merger Agreement") between the two companies. Under the terms of the Merger Agreement, as amended by the Amendment, Realty Income will now pay ARCT stockholders a one-time cash payment of $0.35 per share in addition to the existing fixed exchange ratio of 0.2874 Realty Income shares for each share of ARCT common stock that they own. The additional cash consideration of $0.35 per share totals approximately $55.5 million in additional proceeds for the ARCT stockholders, of which approximately $52.5 million is being funded by Realty Income and $3.0 million by AR Capital LLC, including William M. Kahane, Chief Executive Officer, President and Director of ARCT, and Nicholas S. Schorsch, Chairman of the board of directors of ARCT.

(Logo: http://photos.prnewswire.com/prnh/20120529/NY15153LOGO

Realty Income also announced that upon the closing of the transaction, its board of directors intends to increase the annualized dividend to Realty Income stockholders by approximately $0.35 per share, to an annualized rate of $2.17 per share beginning with the February 2013 distribution. This represents a $0.22 increase to the original dividend increase of $0.13 per share that Realty Income estimated when the transaction was initially announced. In addition, based on Realty Income's strong revenue and Adjusted Funds from Operations outlook for 2013, Realty Income announced that its board of directors intends to raise the annualized dividend by $0.10 per share in February 2013 even if the ARCT transaction does not close. The $0.35 per share estimated annualized dividend increase expected after the close of the merger with ARCT includes this $0.10 per share increase.

Tom A. Lewis, Chief Executive Officer of Realty Income commented, "We strongly believe in the merits of this transaction, which will advance our strategic objectives of increasing our revenue generated by investment grade tenants and further diversifying our portfolio. The amended agreement announced today represents our best and final offer. By upsizing the increase of the annualized dividend to be paid, assuming the closing of the ARCT acquisition, we believe we have materially addressed the difference in dividend rates and that the interests of ARCT stockholders, as well as Realty Income's existing stockholders, will be well served."

Nicholas S. Schorsch, Chairman of ARCT, said, "We are extremely pleased to have reached this amended agreement with Realty Income. The ARCT board is confident that this increased offer from Realty Income not only achieves the highest attainable value for our stockholders, but also allows them to participate in the potential upside of the combined company. The $0.35 per share cash payment will provide ARCT stockholders with an immediate increase in transaction value of approximately $55.5 million, and the Realty Income dividend increase will enhance the income stream for ARCT stockholders as the combined company continues to grow."

Realty Income and ARCT have confirmed that if ARCT stockholders do not approve the merger on its revised terms, then the Merger Agreement will be terminated, and if Realty Income obtains its stockholder approval, Realty Income will receive $4.0 million in expense reimbursement from ARCT. As disclosed in ARCT's January 2, 2013 press release, the ARCT management team will continue to operate and grow ARCT consistent with its established operating, investment and capitalization strategies, should the Merger Agreement be terminated.

All other terms and conditions remain the same as those set out in the Merger Agreement as described in detail in the definitive proxy mailed to Realty Income and ARCT stockholders on December 6, 2012 and available on www.sec.gov. The transaction is expected to close in January 2013, following a vote by the stockholders of both companies on January 16, 2013.

The Special Meeting of Realty Income stockholders to consider and vote on the proposal to approve the issuance of shares of Realty Income common stock in connection with the acquisition, is scheduled for January 16, 2013. Realty Income stockholders of record as of December 6, 2012 will be entitled to vote on the proposal.

The Special Meeting of ARCT stockholders to consider and vote upon a proposal to approve the merger with Realty Income and the other transactions contemplated by the Merger Agreement providing for the acquisition of ARCT by Realty Income is scheduled for January 16, 2013. ARCT stockholders of record as of December 6, 2012 will be entitled to vote at the Special Meeting.

Realty Income and ARCT expect to file additional supplemental materials regarding the Amendment with the Securities and Exchange Commission soon and stockholders are urged to review these materials when available.

1 of 2

Select the service that is right for you!

COMPARE ALL SERVICES
Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
DOW 16,943.57 +23.98 0.14%
S&P 500 1,983.04 +1.44 0.07%
NASDAQ 4,527.1820 -0.3320 -0.01%

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs