Item 1.01. Entry into a Material Definitive Agreement
On November 9, 2021, Realty Income Corporation (the "Company") completed its
previously announced debt exchange offers (the "Exchange Offers") to exchange
all validly tendered and accepted 4.600% Notes due 2024 (the "VEREIT 2024
Notes"), 4.875% Notes due 2026 (the "VEREIT 2026 Notes"), 3.950% Notes due 2027
(the "VEREIT 2027 Notes"), 4.625% Notes due 2025 (the "VEREIT 2025 Notes"),
3.100% Notes due 2029 (the "VEREIT 2029 Notes"), 3.400% Notes due 2028 (the
"VEREIT January 2028 Notes"), 2.200% Notes due 2028 (the "VEREIT June 2028
Notes") and 2.850% Notes due 2032 (the "VEREIT 2032 Notes" and together with the
VEREIT 2024 Notes, VEREIT 2026 Notes, VEREIT 2027 Notes, VEREIT 2025 Notes,
VEREIT 2029 Notes, VEREIT January 2028 Notes and VEREIT June 2028 Notes, the
"VEREIT Notes"), issued by VEREIT Operating Partnership, L.P. ("VEREIT"), a
wholly owned subsidiary of the Company, for new Notes issued by the Company (as
described below). Pursuant to the Exchange Offers, the aggregate principal
amounts of the VEREIT Notes set forth below were tendered and subsequently
cancelled:
i. U.S.$ 485,300,000 aggregate principal amount of VEREIT 2024 Notes;
ii. U.S.$ 595,759,000 aggregate principal amount of VEREIT 2026 Notes;
iii. U.S.$ 594,146,000 aggregate principal amount of VEREIT 2027 Notes;
iv. U.S.$ 544,229,000 aggregate principal amount of VEREIT 2025 Notes;
v. U.S.$ 596,883,000 aggregate principal amount of VEREIT 2029 Notes;
vi. U.S.$ 597,979,000 aggregate principal amount of VEREIT January 2028 Notes;
vii. U.S.$ 497,120,000 aggregate principal amount of VEREIT June 2028 Notes;
and
viii. U.S.$ 699,533,000 aggregate principal amount of VEREIT 2032 Notes.
Following such cancellation, $24,351,000 aggregate principal amount of VEREIT
Notes remain outstanding across the eight series. Concurrently with settlement
of the Exchange Offers, VEREIT entered into the third supplemental indenture,
dated as of November 9, 2021 (the "Third Supplemental Indenture"), by and among
VEREIT, Rams MD Subsidiary I, Inc. (f/k/a VEREIT, Inc.) and U.S. Bank National
Association, as trustee, and, with respect to each series of VEREIT Notes that
remained outstanding, amended the indenture governing the VEREIT Notes to, among
other things, eliminate substantially all of the restrictive covenants in such
indenture.
The foregoing summary of the Third Supplemental Indenture does not purport to be
complete and is qualified in its entirety by reference to the complete terms of
the Third Supplemental Indenture, a copy of which is filed with this Current
Report on Form 8-K as Exhibit 4.1 and is incorporated herein by reference.
Item 2.03. Creation of Direct Financial Obligation or an Obligation under an
Off-Balance Sheet Arrangement of a Registrant
In connection with the settlement of the Exchange Offers, the Company issued (i)
$ 485,299,000 aggregate principal amount of 4.600% Notes due February 6, 2024
(the "2024 Notes"), (ii) $ 595,756,000 aggregate principal amount of 4.875%
Notes due June 1, 2026 (the "2026 Notes"), (iii) $ 594,019,000 aggregate
principal amount of 3.950% Notes due August 15, 2027 (the "2027 Notes"), (iv) $
544,226,000 aggregate principal amount of 4.625% Notes due November 1, 2025 (the
"2025 Notes"), (v) $ 596,174,000 aggregate principal amount of 3.100% Notes due
December 15, 2029 (the "2029 Notes"), (vi) $ 597,795,000 aggregate principal
amount of 3.400% Notes due January 15, 2028 (the "January 2028 Notes"), (vii) $
497,079,000 aggregate principal amount of 2.200% Notes due June 15, 2028 (the
"June 2028 Notes") and (viii) $ 699,188,000 aggregate principal amount of 2.850%
Notes due December 15, 2032 (the "2032 Notes" and together with the 2024 Notes,
2026 Notes, 2027 Notes, 2025 Notes, 2029 Notes, January 2028 Notes and June 2028
Notes, the "Notes") pursuant to the indenture, dated October 28, 1998, between
the Company and The Bank of New York Mellon Trust Company, N.A., as trustee (the
"Indenture") in exchange for the validly tendered and accepted VEREIT Notes.
Prior to the applicable par call date, the Notes of each series will be
redeemable, at any time in whole or from time to time in part, at the option of
the Company at a redemption price equal to the greater of: (a) 100% of the
principal amount of the Notes of such series to be redeemed, and (b) the sum of
the present values of the remaining scheduled payments of principal of and
interest on the Notes of such series to be redeemed (exclusive of interest
accrued to the applicable redemption date), assuming that the Notes of such
series matured and that accrued and unpaid interest on the Notes of such series
was payable on the applicable par call date (or, solely with respect to the 2024
Notes, February 6, 2024), discounted to such redemption date on a semi-annual
basis, assuming a 360-day year consisting of twelve 30-day months, at the
Treasury Rate (as defined in the Notes) plus the number of basis points
applicable to such series of Notes, plus, in the case of both clauses (a) and
(b) above, accrued and unpaid interest on the principal amount of the Notes of
the such series being redeemed to such redemption date.
Upon the occurrence of a Change of Control Triggering Event solely with respect
to the 2026 Notes (as defined in the 2026 Notes), each holder of outstanding
2026 Notes will have the right to require the Company to purchase all or a
portion of such holder's 2026 Notes at a purchase price of 101% of the principal
amount plus accrued and unpaid interest, if any, to the date of purchase, unless
the Company has earlier redeemed or delivered a valid notice of redemption with
respect to all of the outstanding 2026 Notes as described above.
Each of the following constitutes an event of default under the Indenture with
respect to any series of Notes: (1) default for 30 days in the payment of any
installment of interest on any debt security of that series; (2) default in the
payment of the principal of (or premium, if any, on) any debt security of that
series when due, whether at stated maturity or by declaration of acceleration,
notice of redemption, notice of option to elect repayment or otherwise;
(3) default in the deposit of any sinking fund payment, when and as due by the
terms of any debt security of that series; (4) default in the performance of any
of the Company's other covenants contained in the Indenture or in any debt
security of that series (other than a covenant added to the Indenture solely for
the benefit of a series of debt securities issued thereunder other than that
series), which continues for 60 days after written notice is given to the
Company by the trustee or to the Company and the trustee by the holders of at
least 25% in principal amount of the outstanding debt securities of that series;
(5) default under any bond, debenture, note or other evidence of indebtedness
for money borrowed by the Company or any of its Subsidiaries (as defined in the
Indenture) (including obligations under leases required to be capitalized on the
balance sheet of the lessee under generally accepted accounting principles, but
not including any indebtedness or obligations for which recourse is limited to
property purchased) in an aggregate principal amount in excess of $25,000,000 or
under any mortgage, indenture or instrument under which there may be issued or
by which there may be secured or evidenced any indebtedness for money borrowed
by the Company or any of its Subsidiaries (including such leases, but not
including such indebtedness or obligations for which recourse is limited to
property purchased) in an aggregate principal amount in excess of $25,000,000,
whether the indebtedness exists at the date of the relevant indenture or shall
thereafter be created, which default shall have resulted in the indebtedness
becoming or being declared due and payable prior to the date on which it would
otherwise have become due and payable or which default shall have resulted in
the obligation being accelerated, without the acceleration having been rescinded
or annulled; (6) certain events of bankruptcy, insolvency or reorganization with
respect to the Company or any of its Significant Subsidiaries (as defined in the
Indenture); or (7) any other event of default provided with respect to a
particular series of debt securities.
The Indenture includes requirements that must be met if the Company consolidates
or merges with, or sells all or substantially all of the Company's assets to,
another entity.
The foregoing summary is qualified in its entirety by reference to the text of
the Indenture, a copy of which is incorporated by reference to Exhibit 4.1 to
the Company's Current Report on Form 8-K (File No. 001-13374) filed on October
28, 1998 , and the Notes, forms of each series of which are attached as
Exhibits 4.2, 4.3, 4.4, 4.5, 4.6, 4.7 and 4.8 to this Current Report on Form
8-K.
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits.
Exhibit No Description
4.1 Third Supplemental Indenture, dated as of November 9, 2021, by and
among VEREIT Operating Partnership, L.P., Rams MD Subsidiary I, Inc.
(f/k/a VEREIT, Inc.) and U.S. Bank National Association, as trustee.
4.2 4.600% Notes due February 6, 2024.
4.3 4.625% Notes due November 1, 2025.
4.4 4.875% Notes due June 1, 2026.
4.5 3.950% Notes due August 15, 2027.
4.6 3.400% Notes due January 15, 2028.
4.7 2.200% Notes due June 15, 2028.
4.8 3.100% Notes due December 15, 2029.
4.9 2.850% Notes due December 15, 2032.
104 The Form 8-K cover page, formatted in Inline Extensible Business
Reporting Language and included as Exhibit 101
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