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EX-99.1 - EXHIBIT 99.1 - American Realty Capital Trust IV, Inc.v327136_ex99-1.htm

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

 

_________________

 

FORM 8-K

 

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the

Securities Exchange Act of 1934

 

Date of report (Date of earliest event reported): November 1, 2012 (October 30, 2012)

 

American Realty Capital Trust IV, Inc.

(Exact Name of Registrant as Specified in Its Charter)

 

Maryland

(State or Other Jurisdiction of Incorporation)

 

333-180274   32-0372241
(Commission File Number)   (IRS Employer Identification No.)

 

405 Park Avenue, 15th Floor

New York, New York 10022

(Address, including zip code, of Principal Executive Offices) 
 
(212) 415-6500
(Registrant’s Telephone Number, Including Area Code)

  

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

 

¨Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

   

¨Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

   

¨Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

   

¨Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

 
 

 

Item 2.01. Completion of Acquisition or Disposition of Assets.

 

FedEx Ground – Independence, Kansas

 

On October 30, 2012, American Realty Capital Trust IV, Inc. (the “Company”), through a wholly owned subsidiary of its operating partnership, closed the acquisition of the fee simple interest in a FedEx Ground distribution facility located in Independence, Kansas for a contract purchase price of $2.5 million. The seller of the property was 2011 Independence, LLC. The seller has no material relationship with the Company and the acquisition was not an affiliated transaction.

 

The Company funded 100% of the acquisition of the property with cash from its ongoing initial public offering.

 

The property contains approximately 23,400 rentable square feet and is 100% leased to FedEx Ground Package System, Inc., a wholly owned subsidiary of FedEx Corporation (NYSE: “FDX”). The lease had an original lease term of 10 years and expires in May 2022.  The lease contains two renewal options of five years each. The first renewal option contains a 10% rental increase and the second renewal option contains a 5% rental increase. Under the terms of the lease, the tenant is responsible for base rent and certain operating expenses, excluding costs to maintain the exterior structure of the building and certain maintenance repairs. The annualized straight line rental income for the initial lease term is $0.2 million.

 

FedEx Ground – Ottumwa, Iowa

 

On October 30, 2012, the Company, through a wholly owned subsidiary of its operating partnership, closed the acquisition of the fee simple interest in a FedEx Ground distribution facility located in Ottumwa, Iowa for a contract purchase price of $3.0 million, exclusive of closing costs. The seller of the property was 2011 Ottumwa, LLC. The seller has no material relationship with the Company and the acquisition was not an affiliated transaction.

 

The Company funded 100% of the acquisition of the property with cash from its ongoing initial public offering.

 

The property contains approximately 29,300 rentable square feet and is 100% leased to FedEx Ground Package System, Inc., a wholly owned subsidiary of FedEx Corporation (NYSE: “FDX”). The lease had an original lease term of 10 years and expires in April 2022.  The lease contains two renewal options of five years each. The first renewal option contains a 10% rental increase and the second renewal option contains a 5% rental increase.  Under the terms of the lease, the tenant is responsible for base rent and certain operating expenses, excluding costs to maintain the exterior structure of the building and certain maintenance repairs. The annualized straight line rental income for the initial lease term is $0.2 million.

 

CVS Pharmacy – New Castle, Pennsylvania

 

On October 31, 2012, the Company, through a wholly owned subsidiary of its operating partnership, closed the acquisition of the fee simple interest in a CVS Pharmacy located in New Castle, Pennsylvania for a contract purchase price of $3.1 million, exclusive of closing costs.. The seller of the property was Eighteen-o-Three Wilmington Rd LLC. The seller has no material relationship with the Company and the acquisition was not an affiliated transaction.

 

The Company funded 100% of the acquisition of the property with cash from its ongoing initial public offering.

 

The property contains 10,000 rentable square feet and is 100% leased to CVS Caremark Corporation (NYSE: “CVS”). The lease had an original lease term of 20 years and expires in January 2025.  The lease contains no rental escalations and five renewal options of five years each.  Under the terms of the lease, the tenant is responsible for base rent and certain operating expenses, excluding costs to maintain the exterior structure of the building and certain maintenance repairs. The annualized straight line rental income for the initial lease term is $0.2 million.

 

 
 

 

A copy of the press release announcing the Company’s acquisition of two FedEx distribution facilities located in Independence, Kansas and Ottumwa, Iowa and a CVS pharmacy located in New Castle, Pennsylvania is included as Exhibit 99.1 to this Current Report on Form 8-K.

 

Item 9.01. Financial Statements and Exhibits.

 

(a) Financial Statements of Business Acquired (Lessees)

 

Set forth in this Item 9.01(a) are summary financial statements of FedEx Corporation and CVS Caremark Corporation as described under Item 2.01 of this Current Report on Form 8-K.

 

FedEx Corporation and CVS Caremark Corporation currently file their financial statements in reports filed with the U.S. Securities and Exchange Commission, and the following summary financial data regarding FedEx Corporation and CVS Caremark Corporation are taken from such filings:

 

FedEx Corporation

 

   Year Ended 
(Amounts in Millions)  Three Months
Ended
August 31, 2012
(Unaudited))
   May 31, 2012 (Audited)   May 31, 2011 (Audited)   May 31, 2010
(Audited)
 
Statements of Operations Data                    
Revenues  $10,792   $42,680   $39,304   $34,734 
Operating income   742    3,186    2,378    1,998 
Net income   459    2,032    1,452    1,894 

 

(Amounts in Millions)  August 31, 2012
(Unaudited)
   May 31, 2012 (Audited)   May 31, 2011 (Audited)   May 31, 2010 (Audited) 
Consolidated Condensed Balance Sheets                    
Total assets  $30,691   $29,903   $27,385   $24,902 
Long-term debt   2,242    1,250    1,667    1,668 
Total common stockholders’ investment   15,024    14,727    15,220    13,811 

 

 
 

 

CVS Caremark Corporation

 

   Year Ended 
(Amounts in Millions)  Six Months
Ended
June 30, 2012
(Unaudited))
   December 31, 2011 (Audited)   December 31, 2010 (Audited)   December 31, 2009
(Audited)
 
Statements of Operations Data                    
Net Revenues  $61,512   $107,100   $95,778   $98,215 
Operating profit   3,111    6,330    6,137    6,425 
Net income attributed to CVS Caremark   1,742    3,461    3,427    3,696 

 

(Amounts in Millions)  June 30, 2012
(Unaudited)
   December 31, 2011 (Audited)   December 31, 2010 (Audited)   December 31, 2009 (Audited) 
Consolidated Condensed Balance Sheets                    
Total assets  $65,589   $64,543   $62,169   $61,641 
Long-term debt   9,208    9,208    8,652    8,756 
Total common stockholders’ equity   37,913    38,051    37,700    35,768 

 

(d)Exhibits

 

Exhibit No.   Description
99.1   Press Release dated November 1, 2012

 

 
 

 

 SIGNATURES

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

  AMERICAN REALTY CAPITAL TRUST IV, INC.
       
       
Date: November 1, 2012 By: /s/ Nicholas S. Schorsch 
    Name: Nicholas S. Schorsch
    Title:

Chief Executive Officer and

Chairman of the Board of Directors