#United States #San Diego #Convertible Notes #Realty Income #Monthly Dividend

Realty Income Corporation Unveils Convertible Senior Notes Offering

Realty Income Corporation, renowned as The Monthly Dividend Company®, has officially announced its intention to conduct a private offering of convertible senior notes, amounting to $750 million. This strategic move, set against the backdrop of prevailing market and other conditions, is designed for investors who qualify under Rule 144A of the Securities Act of 1933.

The proposed notes are expected to mature on January 15, 2029, unless Realty Income opts to repurchase, redeem, or convert them earlier. Noteholders will enjoy the flexibility to convert their notes under specified circumstances, with conversions settled through a mix of cash and potentially shares of Realty Income’s common stock, depending on the conversion rate applicable at that time.

Realty Income has made it clear that it retains the right to redeem these notes prior to maturity. Such redemptions would occur solely to maintain its status as a real estate investment trust for U.S. federal income tax purposes. In such cases, the redemption price will consist of the principal amount of the notes, plus any accrued but unpaid interest. Notably, these notes will not be redeemable at the discretion of Realty Income before maturity under normal circumstances.

A particularly intriguing aspect of the offering is the potential for existing noteholders to require Realty Income to repurchase their notes for cash in the event of certain 'fundamental changes.' These changes encompass significant business combination events or specific de-listing occurrences concerning Realty Income's common stock. The buyback price in such scenarios would match the principal and any accrued interest up to the repurchase date.

Crucially, the precise terms, including the interest rate and initial conversion rates, will be established during the pricing of this offering, reflecting current market conditions.

Use of Proceeds

Realty Income plans to allocate the net proceeds from this offering primarily for general corporate purposes. This allocation may include repaying existing debts, such as the $500 million of senior notes maturing in January 2026, seeking foreign currency swaps or other hedging options, and facilitating the acquisition or development of new properties. The company is also expected to utilize a portion of the funds to repurchase shares of its common stock at the time of the offering's pricing. Such moves could potentially influence the initial conversion price of the notes offered, as enhanced trading activity might elevate stock prices compared to scenarios without these repurchases.

It is essential to note that the offering, as well as any shares resulting from the conversion of these notes, will not be registered under the Securities Act or other securities laws, limiting their sale to a narrowly-defined set of circumstances.

About Realty Income Corporation

Founded in 1969, Realty Income Corporation is distinguished as an S&P 500 company and supports a portfolio exceeding 15,500 properties across all U.S. states, the United Kingdom, and seven additional countries in Europe. With a mission to invest in people and environments that yield dependable monthly dividends, Realty Income has earned its reputation as The Monthly Dividend Company®. To date, it has achieved 133 dividend increases since its NYSE listing in 1994, placing it among the exclusive ranks of the S&P 500 Dividend Aristocrats for maintaining a streak of dividend increases spanning over 30 consecutive years.

This offering reflects Realty Income's ongoing commitment to financial growth while providing investors a trustworthy steady income stream through strategic investments in real estate. With a clear focus on enhancing shareholder value and maintaining its extraordinary dividend history, Realty Income continues to solidify its position as a leader in the real estate investment trust sector.

Forward-Looking Statements

It is essential for investors to recognize that this announcement contains forward-looking statements regarding the anticipated characteristics and timelines for the noted offering, along with expected uses of its net proceeds. These statements, while representing Realty Income's current views and expectations, carry inherent risks that may lead to divergent actual results. Potential challenges from market volatility, interest rates, and various business risks should be carefully considered by investors before making financial decisions based on these forward-looking insights.