Item 8.01.   Other Events.
As previously disclosed, on April 29, 2021, VEREIT, Inc., a Maryland corporation
("VEREIT"), and VEREIT Operating Partnership, L.P., a Delaware limited
partnership ("VEREIT OP"), entered into an Agreement and Plan of Merger (as
amended, the "Merger Agreement") with Realty Income Corporation ("Realty
Income"), a Maryland corporation, Rams MD Subsidiary I, Inc., a Maryland
corporation and wholly owned subsidiary of Realty Income ("Merger Sub 1"), and
Rams Acquisition Sub II, LLC, a Delaware limited liability company and wholly
owned subsidiary of Realty Income ("Merger Sub 2"). Pursuant to the terms and
conditions of the Merger Agreement, upon the closing, (i) Merger Sub 2 will be
merged with and into VEREIT OP (the "Partnership Merger"), with VEREIT OP
continuing as the surviving entity and, immediately following the Partnership
Merger, (ii) VEREIT will be merged with and into Merger Sub 1, with Merger Sub 1
continuing as the surviving corporation (the "Merger" and, together with the
Partnership Merger, the "Mergers").
In connection with the proposed Mergers, Realty Income filed with the U.S.
Securities and Exchange Commission (the "SEC") a registration statement on Form
S-4 containing a joint proxy statement/prospectus, as amended, and VEREIT filed
a definitive proxy statement and Realty Income filed a definitive proxy
statement/prospectus with the SEC, each dated June 29, 2021 (collectively, the
"joint proxy statement/prospectus"), which VEREIT and Realty Income first mailed
to their respective stockholders on or about July 9, 2021.
Following the announcement of the Merger Agreement, as of the date of this
Current Report on Form 8-K, purported stockholders of VEREIT have filed twelve
lawsuits challenging disclosures related to the Merger (the "VEREIT
Complaints"). The VEREIT Complaints are Stein v. VEREIT, Inc., et al., Case No.
1:21-cv-01409 (D. Md. June 7, 2021) (the "Stein Complaint"); Bowles v. VEREIT,
Inc., et al., Case No. 1:21-cv-00845 (D. Del. June 10, 2021) (the "Bowles
Complaint"); Leach v. VEREIT, Inc., et al., Case No. 1:21-cv-05270 (S.D.N.Y.
June 14, 2021) (the "Leach Complaint"); Jenkins v. VEREIT, Inc., et al., Case
No. 1:21-cv-05286 (S.D.N.Y. June 15, 2021) (the "Jenkins Complaint"); Tacka v.
VEREIT, Inc., et al., Case No. 1:21-cv-05357 (S.D.N.Y. June 17, 2021) (the
"Tacka Complaint"); Congregation Zichron Moishe v. VEREIT, Inc., et al., Case
No. 1:21-cv-01729 (D. Colo. June 24, 2021) (the "Congregation Zichron Moishe
Complaint"); Mishra v. VEREIT, Inc., et al., Case No. 1:21-cv-01758 (D. Colo.
June 28, 2021) (the "Mishra Complaint"); Walker v. VEREIT, Inc., et al., Case
No. 1:21-cv-01791 (D. Colo. July 1, 2021) (the "Walker Complaint"); Ciccotelli
v. VEREIT, Inc., et al., Case No. 2:21-cv-02983 (E.D. Pa. July 2, 2021) (the
"Ciccotelli Complaint"); Upton v. VEREIT, Inc., et al., Case No. 1:21-cv-06129
(S.D.N.Y. July 16, 2021) (the "Upton Complaint"); Matten v. VEREIT, Inc., et
al., Case No. 1:21-cv-06212 (S.D.N.Y. July 21, 2021) (the "Matten Complaint");
and Halberstam v. VEREIT, Inc., et al., Case No. 1:21-cv-02000 (D. Colo. July
23, 2021 (the "Halberstam Complaint").
The Stein, Leach, Tacka, Matten and Halberstam Complaints name VEREIT and the
members of the VEREIT board of directors as defendants. The Congregation Zichron
Moishe, Mishra, Walker and Upton Complaints name VEREIT, VEREIT OP, and the
members of the VEREIT board of directors as defendants. The Bowles and
Ciccotelli Complaints name VEREIT, the members of the VEREIT board of directors,
VEREIT OP, Realty Income, Merger Sub 1 and Merger Sub 2 as defendants. The
Jenkins Complaint names VEREIT, the members of the VEREIT board of directors,
Realty Income, Merger Sub 1 and Merger Sub 2 as defendants.
Each of the VEREIT Complaints alleges that VEREIT and the members of the VEREIT
board of directors violated Section 14(a) of the Securities Exchange Act of 1934
(the "Exchange Act") and Rule 14a-9 promulgated thereunder by preparing and
disseminating a registration statement that misstates or omits certain allegedly
material information. Each of the VEREIT Complaints also alleges that the
members of the VEREIT board of directors violated Section 20(a) of the Exchange
Act by causing VEREIT to disseminate a misleading registration statement. The
Bowles and Ciccotelli Complaints further allege that Realty Income and VEREIT OP
violated Section 20(a) of the Exchange Act. The Mishra, Congregation Zichron
Moishe, Walker and Upton Complaints further allege that Realty Income and VEREIT
OP violated Section 14(a) of the Exchange Act and Rule 14a-9 promulgated
thereunder. The Jenkins Complaint further alleges that Realty Income, Merger Sub
1 and Merger Sub 2 violated Section 14(a) of the Exchange Act and Rule 14a-9
promulgated thereunder, that the members of the VEREIT board of directors have
violated the fiduciary duties they owe towards VEREIT's stockholders by causing
VEREIT to enter into the Merger at an unfair price and through an unfair
process, and that VEREIT, Realty Income, Merger Sub 1 and Merger Sub 2 aided and
abetted this alleged breach of fiduciary duty.
Each of the VEREIT Complaints seeks, among other things, injunctive relief
enjoining the consummation of the Merger, if the Merger is consummated,
rescission or rescissory damages and an award of the plaintiff's costs,
including attorneys' and experts' fees.
In addition, following the announcement of the Merger Agreement, as of the date
of this Current Report on Form 8-K, purported stockholders of Realty Income have
filed one lawsuit challenging the disclosures related to the Merger (the "Realty
                                       1
--------------------------------------------------------------------------------

Income Complaint"). The Realty Income Complaint is Boyko v. Realty Income Corp.,
et al., Case No. 1:21-cv-01653 (D. Colo., June 16, 2021) (together with the
VEREIT Complaints, the "Complaints"). The Boyko Complaint names Realty Income
and the members of the Realty Income board of directors as defendants. The Boyko
Complaint alleges that Realty Income and the members of the Realty Income board
of directors violated Section 14(a) of the Exchange Act and Rule 14a-9
promulgated thereunder by preparing and disseminating a registration statement
that misstates or omits certain allegedly material information. The Boyko
Complaint also alleges that the members of the Realty Income board of directors
violated Section 20(a) of the Exchange Act by causing Realty Income to
disseminate a misleading registration statement.
All of the defendants named in the Complaints believe that the claims asserted
in the Complaints are entirely without merit. However, litigation is inherently
uncertain and there can be no assurance regarding the likelihood that the
defendants' defense of the actions will be successful. Additional lawsuits
arising out of the Mergers may also be filed in the future. While VEREIT and
Realty Income believe that the disclosures set forth in the joint proxy
statement/prospectus comply fully with applicable law, to moot plaintiffs'
disclosure claims and to avoid nuisance, potential expense and delay, VEREIT and
Realty Income have determined to voluntarily supplement the joint proxy
statement/prospectus with the below disclosures. Nothing in the below
supplemental disclosures shall be deemed an admission of the legal necessity or
materiality under applicable law of any of the disclosures set forth herein or
in the joint proxy statement/prospectus. To the contrary, VEREIT and Realty
Income deny all allegations in the Complaints that any additional disclosure was
or is required.
As a result of the supplemental disclosures set forth herein, the attorneys for
the plaintiffs who filed the Complaints have agreed to dismiss, or seek
authority from their clients to dismiss, their respective actions.

        Supplemental Disclosures to the Joint Proxy Statement/Prospectus

VEREIT has agreed to make these supplemental disclosures to the joint proxy statement/prospectus. This supplemental information should be read in conjunction with the joint proxy statement/prospectus, which should be read in its entirety. Defined terms used but not defined below have the meanings set forth in the joint proxy statement/prospectus. All page references in the information below are to pages in the joint proxy statement/prospectus. Paragraph references used herein refer to the joint proxy statement/prospectus before any additions or deletions resulting from the supplemental disclosures. Underlined text shows text being added to a referenced disclosure in the joint proxy statement/prospectus, and stricken-through text shows text being deleted to a referenced disclosure in the joint proxy statement/prospectus. The information contained herein speaks only as of June 29, 2021 unless the information indicates another date applies. The section of the joint proxy statement/prospectus entitled "The Mergers-Background of the Mergers" is hereby supplemented as follows:

The fourth full paragraph on page 44 of the joint proxy statement/prospectus is amended and restated in its entirety to read as follows:

Shortly following that conversation, Mr. Rufrano consulted with Hugh R. Frater, Chairman of the VEREIT board of directors, regarding a potential business combination of VEREIT and Realty Income, and the various factors to be considered by the VEREIT board of directors if VEREIT were to explore such a business combination. Mr. Rufrano and Mr. Frater were supportive of engaging in preliminary exploration of such a business combination with Realty Income, and agreed that Mr. Rufrano should continue discussions with Mr. Roy and that VEREIT provide certain non-public information for Realty Income's review consistent with Mr. Roy's request.

The section of the joint proxy statement/prospectus entitled "The Mergers-Opinion of Realty Income's Financial Advisor-Dividend Discount Model Analysis" is hereby supplemented as follows:

The second full paragraph on page 61 of the joint proxy statement/prospectus is amended and restated in its entirety to read as follows:

For Realty Income, Moelis utilized a range of discount rates (based on an estimated range of the cost of equity for Realty Income and selected based on Moelis' judgment and experience) of 6.25% to 8.75% to calculate estimated present values as of June 30, 2021 of (i) estimated dividends per share that Realty Income was forecasted to distribute during the six months ending December 31, 2021 and the fiscal years ending December 31, 2022 and December 31, 2023 and (ii) estimated terminal values derived by applying a range of multiples of 16.50x to 21.00x (selected based on Moelis' judgment and experience after consideration of certain trading multiples of Realty Income and certain other selected public companies) to a


                                       2
--------------------------------------------------------------------------------

terminal year one-year forward estimate of Adjusted Funds from Operations per share for Realty Income, which reflects an assumed 4.0% growth, as projected by the management of Realty Income, from the Adjusted Funds from Operations per share for Realty Income for the fiscal year ending December 31, 2023 based on the Realty Income Projections. For VEREIT, Moelis utilized a range of discount rates (based on an estimated range of the cost of equity for VEREIT and selected based on Moelis' judgment and experience) of 7.00% to 10.00% to calculate estimated present values as of June 30, 2021 of (i) estimated dividends per share that VEREIT was forecasted to distribute during the six months ending December 31, 2021 and the fiscal years ending December 31, 2022 and December 31, 2023 and (ii) estimated terminal values derived by applying a range of multiples of 12.50x to 15.50x (selected based on Moelis' judgment and experience after consideration of certain trading multiples of VEREIT and certain other selected public companies) to a terminal year one-year forward estimate of Adjusted Funds from Operations per share for VEREIT, which reflects an assumed 4.0% growth, as projected by the management of Realty Income, from the Adjusted Funds from Operations per share for VEREIT for the fiscal year ending December 31, 2023 based on the Realty Income Projections for VEREIT. The ranges of the per share terminal values (discounted at the cost of equity described above) for each of Realty Income and VEREIT that were indicated by Moelis' analyses contributed 89% to 91% of the total implied per share equity value ranges for Realty Income and VEREIT, respectively.

The section of the joint proxy statement/prospectus entitled "The Mergers-Opinion of Realty Income's Financial Advisor-Other Information" is hereby supplemented as follows:

The second full paragraph on page 63 of the joint proxy statement/prospectus is amended and restated in its entirety to read as follows:

For reference only, Moelis reviewed a precedent premia paid analysis in which Moelis reviewed premia paid in 28 selected REIT transactions announced since 2015 with transaction values over $1 billion. Moelis did not utilize a precedent premia paid analysis for purposes of its analysis or opinion but included the data for informational purposes. These transactions reflected mean, median, 25th percentile, and 75th percentile (a) one-day premiums of 17.4%, 15.5%, 9.8% and 20.9%, respectively and (b) one-week premiums of 18.8%, 15.7%, 11.3% and 20.8%, respectively. Moelis noted that the (i) one-day premium implied by the Exchange Ratio and the $41.32 closing share price for VEREIT on April 27, 2021 was 17.5% and (ii) one-week premium implied by the Exchange Ratio and the $41.31 closing share price for VEREIT on April 20, 2021 was 17.5%.

The section of the joint proxy statement/prospectus entitled "The Mergers-Opinion of Realty Income's Financial Advisor-Miscellaneous" is hereby supplemented as follows:

The last paragraph beginning on page 63 of the joint proxy statement/prospectus is amended and restated in its entirety to read as follows:

Moelis acted as financial advisor to Realty Income in connection with the Mergers and will receive a transaction fee of $19.0 million for its services, contingent upon the consummation of the Mergers. Moelis also became entitled to receive a fee of approximately $5.0 million upon having substantially completed its work necessary to deliver its opinion, without regard to the conclusion reached therein, which is creditable against the transaction fee. In addition, Realty Income agreed to indemnify Moelis for certain liabilities and other . . .

© Edgar Online, source Glimpses