As filed with the Securities and Exchange Commission on July 22, 2010

Registration No. 333-145949

 

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549



 

PRE-EFFECTIVE AMENDMENT NO. 1 TO
POST-EFFECTIVE AMENDMENT NO. 9 TO
  
FORM S-11
  
FOR REGISTRATION UNDER THE SECURITIES ACT OF 1933
OF SECURITIES OF CERTAIN REAL ESTATE COMPANIES



 

AMERICAN REALTY CAPITAL TRUST, INC.

(Exact Name of Registrant as Specified in Its Governing Instruments)

106 York Road
Jenkintown, Pennsylvania 19046
(215) 887-2189

(Address, Including Zip Code and Telephone Number,
Including Area Code, of Registrant’s Principal Executive Offices)



 

Nicholas S. Schorsch
AMERICAN REALTY CAPITAL TRUST, INC.
106 York Road
Jenkintown, Pennsylvania 19046
(215) 887-2189

(Name and Address, Including Zip Code and Telephone Number,
Including Area Code, of Agent for Service)



 

With a Copy to:

Peter M. Fass, Esq.
Proskauer Rose LLP
1585 Broadway
New York, New York 10036-8299
(212) 969-3000



 

Approximate Date of Commencement of Proposed Sale to Public: As soon as practicable after the registration statement becomes effective.

If any of the securities being registered on this form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act, check the following box: x

If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering: o

If this form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering: o

If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering: o

If delivery of the prospectus is expected to be made pursuant to Rule 434, check, the following box: o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one)

 
Large accelerated filer o   Accelerated filer o
Non-accelerated filer x
(Do not check if a smaller reporting company)
  Smaller reporting company o

This Post-Effective Amendment No. 9 consists of the following:

Supplement No. 9, dated July 22, 2010, included herewith, which will be delivered as an unattached document along with the Prospectus.
Registrant’s final form of Prospectus, dated November 10, 2009, previously filed pursuant to Rule 424(b)(3) on November 13, 2009.
Part II, included herewith.
Signatures, included herewith.
 

 


 
 

TABLE OF CONTENTS

AMERICAN REALTY CAPITAL TRUST, INC.
SUPPLEMENT NO. 9 DATED July 22, 2010
TO THE PROSPECTUS DATED November 10, 2009

This prospectus supplement (this “Supplement No. 9”) is part of the prospectus of American Realty Capital Trust, Inc. (“we,” “us,” “our,” the “REIT” or the “Company”), dated November 10, 2009 (the “Prospectus”), and should be read in conjunction with the Prospectus. This Supplement No. 9 supplements, modifies or supersedes certain information contained in our Prospectus. This Supplement No. 9 consolidates, supersedes and replaces all prior Supplements and must be read in conjunction with our Prospectus. Unless otherwise indicated, the information contained herein is current as of the filing date of the prospectus supplement in which the Company initially disclosed such information. This Supplement No. 9 will be delivered with the Prospectus.

The purpose of this Supplement No. 9 is to consolidate the information contained in all previous supplements to the Prospectus and to update the real estate and financial information of the REIT.

TABLE OF CONTENTS

   
  Supplement No. 9 Page No.   Prospectus
Page No.
Summary Risk Factors     2       N/A  
Status of the Offering     2       N/A  
Shares Currently Outstanding     2       N/A  
Annual Meeting of Stockholders     2       N/A  
Annual Meeting of Board of Directors     2       N/A  
Grant of Stock Options to Independent Directors     2       N/A  
Grant of Restricted Shares to Independent Directors     3       N/A  
Selected Financial Data     3       N/A  
Description of Investments     5       3  
Compensation to Advisor and its Affiliates     5       6  
Status of Fees Paid and Deferred     5       9  
Status of Distributions     6       10, 148  
Share Repurchase Program     8       11, 153  
Risk Factors     9       13  
Restricted Share Plan     9       44  
Compliance with Jobs Creation Act     10       45  
The Advisory Agreement     10       47  
Dealer Manager     11       51  
Affiliated Companies     11       49  
Management Compensation     11       55  
Acquisition and Investment Policies     12       68  
Acquisition of Properties from Affiliates     12       82  
Section 1031 Exchange Program     13       84  
Real Estate Investments Summary     13       87  
Real Estate Investments     18       87  
Potential Property Investments     31       104  
Prior Performance Summary     32       117  
Distribution Policy and Distributions     40       148  
Incorporation of Certain Information by Reference     40       171  
Prior Performance Tables     Appendix C-3-1       Appendix C-3-1  

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Summary Risk Factors

Beginning in the tax year ended December 31, 2008, we have qualified as a REIT.

Status of the Offering

We commenced our initial public offering of 150,000,000 shares of common stock on January 25, 2008. As of July 15, 2010, we had issued 31,788,006 shares of common stock, including 339,077 shares issued in connection with an acquisition in March 2008. Total gross proceeds from these issuances were $314,600,000. As of July 15, 2010, the aggregate value of all share issuances and subscriptions outstanding was $317,600,000 million based on a per share value of $10.00 (or $9.50 per share for shares issued under the DRIP). We will offer these shares until January 25, 2011, provided that the offering will be terminated if all of the shares are sold before then.

Shares Currently Outstanding

As of July 15, 2010, there were approximately 118,771,278 shares of our common stock outstanding, excluding shares available under the distribution reinvestment plan.

Annual Meeting of Stockholders

On Monday, May 17, 2010, we held our 2010 Annual Meeting of Stockholders (the “Annual Meeting”). At the Annual Meeting, holders of our common stock voted to re-elect each of Nicholas S. Schorsch, William M. Kahane, Leslie D. Michelson, William G. Stanley and Robert H. Burns as members of our Board of Directors to serve for terms expiring at the 2011 annual meeting of stockholders and until their respective successors have been duly elected and qualified. No other matters were presented to our stockholders for consideration at the Annual Meeting.

Annual Meeting of the Board of Directors

On Monday, May 17, 2010, the Board of Directors held its 2010 Annual Meeting (the “Annual Board Meeting”). At the Annual Board Meeting, the members of the Board of Directors unanimously approved the appointment of the following individuals to the offices set forth opposite their respective names, to hold office, subject to our Bylaws, until the 2011 annual meeting of the Board of Directors or until their successors have been elected:

 
Name   Title
Nicholas S. Schorsch   Chief Executive Officer
William M. Kahane   President, Chief Operating Officer and Treasurer
Peter M. Budko   Executive Vice President and Chief Investment Officer
Brian S. Block   Executive Vice President and Chief Financial Officer
Michael Weil   Executive Vice President and Secretary

After due and careful consideration, taking into account the following factors, among others: (i) the compensation paid by us to Realty Capital Securities, LLC, our dealer manager, American Realty Capital Properties, LLC, our property manager, and American Realty Capital Advisors, LLC, our advisor; (ii) the size, composition and profitability of our real estate portfolio; (iii) the individual performance of each of our dealer manager, property manager and advisor; and (iv) the rates charged to similarly structured REITs by dealer managers, property managers and advisors performing similar services, each of Leslie D. Michelson, William G. Stanley and Robert H. Burns, our independent directors, approved the renewed retention of each of Realty Capital Securities, LLC, American Realty Capital Properties, LLC and American Realty Capital Advisors, LLC, pursuant to our existing dealer manager agreement, management agreement and advisory agreement, respectively.

Grant of Stock Options to Independent Directors

Our stock option plan provides for the automatic grant of a nonqualified stock option to each of our independent directors, without any further action by our Board of Directors or the stockholders, to purchase 3,000 shares of our common stock on the date of each annual stockholder’s meeting. Accordingly, on May 17,

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2010, the date of the Annual Meeting, each of Leslie D. Michelson, William G. Stanley and Robert H. Burns were granted an option to purchase 3,000 shares of common stock. The exercise price is $10 per share and vest 100% two years after the anniversary.

Grant of Restricted Shares to Independent Directors

Our restricted share plan provides for the automatic grant of 3,000 restricted shares of common stock to each of our independent directors, without any further action by our Board of Directors or the stockholders, on the date of each annual stockholder’s meeting. Accordingly, on May 17, 2010, the date of the Annual Meeting, each of Leslie D. Michelson, William G. Stanley and Robert H. Burns were granted 3,000 restricted shares of common stock. The restricted shares vest over a five year period following the first anniversary of the grant date in increments of 20% per annum.

Selected Financial Data

The selected financial data presented below has been derived from our consolidated financial statements as of the periods indicated:

Balance sheet data (amounts in thousands)

       
  March 31,
2010
  December 31,
     2009   2008   2007
Total real estate investments, at cost   $ 419,994     $ 338,556     $ 164,770     $  
Total assets     417,239       339,277       164,942       938  
Mortgage notes payable     225,118       183,811       112,742        
Total short-term equity           15,878       30,926        
Other notes payable     13,000       13,000       1,090        
Intangible lease obligation, net     9,006       9,085       9,400        
Total liabilities     254,736       228,721       163,183       738  
Total stockholders’ equity     162,503       110,556       1,759       200  

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Operating data (amounts in thousands except per share data)

       
  Three Months Ended March 31, 2010   Year Ended December 31, 2009   Year Ended December 31, 2008   For the Period from August 17, 2007 (date of inception) to December 31, 2007
Total revenue   $ 7,428     $ 14,964     $ 5,546     $  
Expenses:
 
Property management fees to affiliate                 4        
Asset management fees to affiliate           145              
Acquisition and transaction related costs     341       506              
General and administrative     224       507       380       1  
Depreciation and amortization     3,785       8,315       3,056        
Total operating expenses     4,350       9,473       3,440       1  
Operating income (loss)     3,078       5,491       2,106       (1 ) 
Other income (expenses):
 
Interest expense     (3,673 )      (10,353 )      (4,774 )       
Interest income     11       52       3        
Gains on sales to noncontrolling
interest holders, net
    335                    
Gains (losses) on derivative instruments     (152 )      495       (1,618 )       
Total other expenses     3,479       (9,805 )      (6,389 )       
Net loss   $ (401 )    $ (4,315 )    $ (4,283 )    $ (1 ) 
Other data:
                                   
Modified funds from operations(1)(2)   $ 3,314     $ 3,460     $ 477     $  
Cash flows provided by (used in)
operations
    2,060       (2,526 )      4,013       (200 ) 
Cash flows used in investing activities     (81,438 )      (173,786 )      (97,456 )       
Cash flows provided by financing activities     77,146       180,435       94,330       200  
Per share data
 
Net loss per common share – basic and diluted   $ (0.02 )    $ (0.74 )    $ (6.02 )    $  
Distributions declared   $ .70     $ .67     $ .65     $  
Weighted-average number of common shares outstanding, basic and diluted   $ 17,845,489       5,768,761       711,524        

(1) We consider funds from operations (“FFO”) and modified funds from operations (“MFFO”) a useful indicator of the performance of a REIT. Because FFO calculations exclude such factors as depreciation and amortization of real estate assets and gains or losses from sales of operating real estate assets (which can vary among owners of identical assets in similar conditions based on historical cost accounting and useful-life estimates), they facilitate comparisons of operating performance between periods and between other REITs in our peer group. Accounting for real estate assets in accordance with GAAP implicitly assumes that the value of real estate assets diminishes predictability over time. Since real estate values have historically risen or fallen with market conditions, many industry investors and analysts have considered the presentation of operating results for real estate companies that use historical cost accounting to be insufficient by themselves. As a result, we believe that the use of FFO and MFFO, together with the required GAAP presentations, provide a more complete understanding of our performance relative to our peers and a more informed and appropriate basis on which to make decisions involving operating, financing, and investing activities. Other REITs may not define FFO and MFFO in accordance with the current National Association of Real Estate Investment Trust’s (“NAREIT”) definition (as we do) or may

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interpret the current NAREIT definition differently than we do. Consequently, our presentation of FFO and MFFO may not be comparable to other similarly titled measures presented by other REITs.
(2) The FFO and MFFO measurement is applicable for the nine months ended December 31, 2008.

Description of Investments

The following disclosure is to be added to the section of our Prospectus captioned “Description of Investments” on pages 3 – 4 of the Prospectus.

We employ a focused investment strategy: acquire single-tenant, freestanding properties, net-leased on a long term basis to investment grade and other credit-worthy tenants. From a geographical standpoint, our target properties: (i) enjoy a strong location on “Main Street, USA,” e.g. pharmacies, banks, restaurants, gas/convenience stores; or (ii) are situated along high traffic transit corridors at locations carefully selected by the corporate tenant to support operationally essential corporate distribution/warehouse and logistical facilities.

We believe that American corporations, seeking to reduce the costs of distributing their goods and services, are re-evaluating supply chain management and distribution/warehouse capabilities. We believe that this has led to an increased need for well-located real estate from which corporations may cost efficiently aggregate from suppliers and deploy to their regional retail stores. We consider these two operationally essential categories as complementary to our overall portfolio.

Compensation to Advisor and its Affiliates

The following disclosure is added to the second paragraph of the second column of the table on page 6 of our Prospectus under the section captioned “Compensation to Advisor and its Affiliates.”

“We will not be entitled to the Subordinated Participation in Net Sale Proceeds unless our investors have received a 6% cumulative non-compounded return on their capital contributions.”

The following disclosure is added to the last paragraph of the second column of the table on page 6 of our Prospectus under the section captioned “Compensation to Advisor and its Affiliates.”

“We will not be entitled to the Subordinated Incentive Listing Fee unless our investors have received a 6% cumulative non-compounded return on their capital contributions.”

Status of Fees Paid and Deferred

The following information supersedes and replaces the information under the section of our Prospectus captioned “Status of Fees Paid and Deferred” on page 9 of the Prospectus.

From January 1, 2008 through December 31, 2008, the Company reimbursed the Advisor $0 for organizational and offering expenses and incurred the following fees:

acquisition fees of $1,507,369 paid to the Advisor
finance coordination fees of $1,131,015 paid to the Advisor
property management fees of $4,230 paid to the Property Manager

From January 1, 2009 through December 31, 2009, the Company reimbursed the Advisor $5,617,286 for organizational and offering expenses and incurred the following fees:

acquisition fees of $1,690,714 paid to the Advisor
finance coordination fees of $879,626 paid to the Advisor
property management fees of $0 paid to the Property Manager

From January 1, 2010 through June 30, 2010, the Company reimbursed the Advisor $8.4 million for organizational and offering expenses and incurred the following fees:

acquisition fees of $2.0 million paid to the Advisor
finance coordination fees of $0.8 million paid to the Advisor

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property management fees of $0 paid to the Property Manager
asset management fees of $0.3 million paid to the Advisor

Amounts paid to the advisor include approximately of $9.6 million offering costs incurred by the affiliated Advisor and Dealer Manager that exceeds 1.5% of gross offering proceeds earned cumulatively through June 30, 2010. Any organizational or offering expenses that exceed 1.5% of gross offering proceeds over the term of the offering will be the Advisor’s obligation.

The Company pays the Advisor an annualized asset management fee of up to 1.0% based on the aggregate contract purchase price of all properties. Through June 30, 2010, the Company paid $0.5 million to the Advisor and will determine if such fees will be partially waived in subsequent periods on a quarter-to-quarter basis. Such waived fees cumulatively through June 30, 2010 total approximately $4.3 million.

Status of Distributions

The following information supplements the section of our Prospectus captioned “Distribution Policy and Distributions” on pages 10 and 148 of the Prospectus.

On February 25, 2008, our Board of Directors declared a distribution for each monthly period commencing 30 days subsequent to acquiring our initial portfolio of real estate investments. Our daily dividend commenced accruing on April 5, 2008.

On November 5, 2008, the Board of Directors approved an increase in its annual cash distribution from $.65 to $.67, paid monthly. Based on a $10.00 share price, this 20 basis point increase, effective January 2, 2009, results in an annualized distribution rate of 6.7%.

On October 5, 2009, the Board of Directors approved a special distribution of $0.05 per share payable to shareholders of record on December 31, 2009, in addition to the current 6.7% annualized distribution rate paid monthly. This special distribution was paid on January 19, 2010.

On January 27, 2010, the Board of Directors approved an increase in its annual cash distribution from $.67 to $.70, paid monthly. Based on a $10.00 share price, this 30 basis point increase, effective April 1, 2010, results in an annualized distribution rate of 7.0%.

To date, the Company’s distributions have been paid with a combination of cash flows from operations and the proceeds from the sales of common stock. There can be no assurance that cash flows from operations will be sufficient to pay distributions in future periods.

The following table summarizes the Company’s historical and prospective distribution rate, reflecting the special distribution and increase to the annual rate effective April 1, 2010 noted above:

   
Period   Annualized Distribution Rate   Number of Months
May 2008(1) to December 2008     6.5 %      8  
January 2009 to March 2010     6.7 %      15  
Special Distribution – January 2010(2)     0.5 %       
       7.2%(2)  
April 2010 to – June 30, 2010     7.0 %      3  

(1) initial distribution was paid in May 2008.
(2) payable to shareholders of record as of December 31, 2009, resulting in a minimum distribution rate of 7.2% for an investor who owned a common share of the Company for the full year ended December 31, 2009.

The Company determined distributions paid to shareholders in 2009 will be reported as nondividend distributions on Form 1099 for the applicable period. Accordingly, such distributions are generally not subject to ordinary income tax in the related period. This tax characterization is consistent with distributions paid to shareholders in 2008.

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The portion of the distribution that is not subject to tax in a respective tax year is considered a return of capital for tax purposes and will reduce the tax basis of a shareholder’s investment. This defers a portion of applicable taxes until the investment is sold or the Company is liquidated, at which time the shareholder will be taxed at capital gains rates. However, because each investor’s tax considerations are different, the Company recommends that investors consult with their tax advisor.

The following is a chart of monthly distributions declared and paid since the commencement of the offering:

     
  Total   Cash   Distribution Reinvestment Plan
2008:
                          
April   $     $     $  
May     30,262       22,008       8,254  
June     49,638       35,283       14,355  
July     55,042       34,788       20,254  
August     57,584       36,519       21,065  
September     61,395       39,361       22,034  
October     61,425       41,078       20,347  
November     65,496       43,646       21,850  
December     64,442       42,876       21,566  
2009:
                          
January   $ 69,263     $ 46,227     $ 23,036  
February     76,027       50,214       25,813  
March     74,915       49,020       25,895  
April     101,282       64,375       36,907  
May     128,867       78,604       50,263  
June     180,039       106,741       73,298  
July     217,325       127,399       89,926  
August     290,230       177,620       112,610  
September     375,926       220,165       155,761  
October     455,051       264,729       190,322  
November     563,472       328,555       234,917  
December     643,125       374,715       268,410  
January 2010(1)     1,498,413       855,282       643,131  
February 2010     865,993       484,967       381,026  
March 2010     862,117       478,895       383,222  
April 2010     1,085,719       600,607       485,112  
May 2010     1,262,558       695,838       566,720  
June 2010     1,496,075       851,779       674,296  

(1) Includes the special distribution paid on January 19, 2010 to shareholders of record as of December 31, 2009.

The Company, Board of Directors and Advisor share a similar philosophy with respect to paying the dividend. The dividend should principally be derived from cash flows generated from real estate operations. Specifically, funds from operations should equal or exceed distributions in a given period. If needed, the Advisor generally expects to waive its asset management fee and forego entitled reimbursements to ensure the full coverage of the Company’s distributions. The fees and reimbursement that are waived are not deferrals and accordingly, will not be paid by the Company in a future period.

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Share Repurchase Program

The following disclosure will be added to the sections of our Prospectus captioned “Share Repurchase Program” on pages 11 – 12 and 153 – 154 of the Prospectus.

For the year ended December 31, 2009, we received requests to redeem 3,000 common shares pursuant to our share repurchase program. We redeemed 100% of the redemption requests at an average price per share of $9.625 per share. We funded share redemptions for the periods noted above from the cumulative proceeds of the sale of our common shares pursuant to our distribution reinvestment plan and from operating funds of the Company.

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Risk Factors

The following disclosure replaces the second risk factor on page 13 of our Prospectus under the section captioned “Risk Factors — Risks Related to an Investment in American Realty Capital Trust, Inc.”

If our advisor loses or is unable to obtain key personnel, our ability to implement our investment strategies could be delayed or hindered, which could adversely affect our ability to make distributions and the value of your investment.

Our success depends to a significant degree upon the contributions of certain of our executive officers and other key personnel of our advisor, including Nicholas S. Schorsch and William M. Kahane, each of whom would be difficult to replace. Our advisor does not have an employment agreement with any of these key personnel and we cannot guarantee that all, or any particular one, will remain affiliated with us and/or our advisor. If any of our key personnel were to cease their affiliation with our advisor, our operating results could suffer. We maintain separate key man life insurance policies on each Nicholas S. Schorsch, William M. Kahane, Brian S. Block, Peter M. Budko and Michael Weil. We believe that our future success depends, in large part, upon our advisor’s ability to hire and retain highly skilled managerial, operational and marketing personnel. Competition for such personnel is intense, and we cannot assure you that our advisor will be successful in attracting and retaining such skilled personnel. If our advisor loses or is unable to obtain the services of key personnel, our ability to implement our investment strategies could be delayed or hindered, and the value of your investment may decline.

Restricted Share Plan

The following disclosure is to be added on page 44 of the Prospectus.

Restricted Share Plan

On January 22, 2010, our Board of Directors adopted our employee and director incentive restricted share plan. The Board of Directors adopted the plan to:

furnish incentives to individuals chosen to receive restricted shares because they are considered capable of improving our operations and increasing profits;
encourage selected persons to accept or continue employment with our advisor and its affiliates; and
increase the interest of our employees, officers and directors in our welfare through their participation in the growth in the value of our common shares.

Our restricted share plan provides for the automatic grant of 3,000 restricted shares of common stock to each of our independent directors, without any further action by our board of directors or the stockholders, on the date of each annual stockholders’ meeting. Restricted stock issued to independent directors will vest over a five-year period following the first anniversary of the date of grant in increments of 20% per annum.

Our employee and director incentive restricted share plan provides us with the ability to grant awards of restricted shares to our directors, officers and employees (if we ever have employees), employees of our advisor and its affiliates, employees of entities that provide services to us, directors of the advisor or of entities that provide services to us, certain of our consultants and certain consultants to the advisor and its affiliates or to entities that provide services to us. The total number of common shares reserved for issuance under the employee and director incentive restricted share plan is equal to 1.0% of our authorized shares.

Restricted share awards entitle the recipient to common shares from us under terms that provide for vesting over a specified period of time or upon attainment of pre-established performance objectives. Such awards would typically be forfeited with respect to the unvested shares upon the termination of the recipient’s employment or other relationship with us. Restricted shares may not, in general, be sold or otherwise transferred until restrictions are removed and the shares have vested. Holders of restricted shares may receive cash dividends prior to the time that the restrictions on the restricted shares have lapsed. Any dividends payable in common shares shall be subject to the same restrictions as the underlying restricted shares. As of June 30, 2010, we had issued an aggregate of 9,000 restricted shares to our independent directors.

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Compliance with the American Jobs Creation Act

This section supersedes and replaces the discussion contained in the Prospectus under the section of our Prospectus captioned “Compliance with the American Jobs Creation Act” on page 45.

As part of our strategy for compensating our independent directors, we have issued, and we intend to issue, options to purchase our common stock under our independent directors’ stock option plan, and we intend to issue, restricted share awards under our employee and director incentive restricted share plan, each of which described above. This method of compensating individuals may possibly be considered to be a “nonqualified deferred compensation plan” under Section 409A of the Internal Revenue Code.

Under Section 409A, “nonqualified deferred compensation plans” must meet certain requirements regarding the timing of distributions or payments and the timing of agreements or elections to defer payments, and must also prohibit any possibility of acceleration of distributions or payments, as well as certain other requirements. Stock options with an exercise price that is less than the fair market value of the underlying stock as of the date of grant would be considered a “nonqualified deferred compensation plan.” It is intended that the restricted share awards will not be considered “nonqualified deferred compensation.”

If Section 409A applies to any of the awards issued under the plan, or if Section 409A applies to any other arrangement or agreement that we may make, and if such award, arrangement or agreement does not meet the timing and other requirements of Section 409A, then (a) all amounts deferred for all taxable years under the award, arrangement or agreement would be currently includible in the gross income of the recipient of such award or of such deferred amount to the extent not subject to a substantial risk of forfeiture and not previously included in the gross income of the recipient, (b) interest at the underpayment rate plus 1% would be imposed on the underpayments that would have occurred had the compensation been includible in income when first deferred (or, if later, when not subject to a substantial risk of forfeiture) would be imposed upon the recipient and (c) a 20% additional tax would be imposed on the recipient with respect to the amounts required to be included in the recipient’s income. Furthermore, if the affected individual is our employee, we would be required to withhold federal income taxes on the amount deferred but includible in income due to Section 409A, although there may be no funds currently being paid to the individual from which we could withhold such taxes. We would also be required to report on an appropriate form (W-2 or 1099) amounts which are deferred, whether or not they meet the requirements of Section 409A, and if we fail to do so, penalties could apply.

We do not intend to issue any award, or enter into any agreement or arrangement that would be considered a “nonqualified deferred compensation plan” under Section 409A, unless such award, agreement or arrangement complies with the timing and other requirements of Section 409A. It is our current belief, based upon the statute, the regulations issued under Section 409A and legislative history, the options we have granted and that we currently intend to implement and the restricted share awards that we currently intend to grant will not be subject to taxation under Section 409A because neither the options nor the restricted share awards will be considered a “nonqualified deferred compensation plan.” Nonetheless, there can be no assurances that any options award, agreement or arrangement which we have entered into will not be affected by Section 409A, or that any such award, agreement or arrangement will not be subject to income taxation under Section 409A.

The Advisory Agreement

The following disclosure is is added as: (i) the third full paragraph on page 47 of our Prospectus under the section captioned “The Advisory Agreement”; (ii) the second full paragraph on page 49 of our Prospectus under the section captioned “Affiliated Companies — American Realty Capital II, LLC”; (iii) the second full paragraph under the section “Certain Relationships and Related Transactions — Advisory Agreement” on page 53 of our Prospectus; and supplements footnotes 13 and 14 under the section captioned “Management Compensation” on page 55 of our Prospectus.

On June 2, 2010, we and American Realty Capital Operating Partnership, L.P. entered into an amended and restated advisory agreement with American Realty Capital Advisors, LLC which amended the advisory agreement to provide that in the event our Board of Directors decides to internalize any management services provided by American Realty Capital Advisors, LLC, neither we nor American Realty Capital Operating

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Partnership, L.P. will pay any compensation to American Realty Capital Advisors, LLC or its affiliates in connection with the internalization transaction.

Dealer Manager

The information is to supplement the section of our Prospectus captioned “Dealer Manager” on pages 51 – 52 of the Prospectus.

Effective January 28, 2010, Bradford Watt resigned as Co-President of Realty Capital Securities, LLC.

Louisa Quatro is the President and Secretary of Realty Capital Securities, LLC.

Effective March 8, 2010, Nicholas Corvinus resigned as Chief Executive Officer of Realty Capital Securities, LLC and Michael Weil was simultaneously appointed Chief Executive Officer of Realty Capital Securities, LLC to fill the vacancy caused by Mr. Corvinus’ resignation. Effective June 7, 2010, Michael Weil resigned as Chief Executive Officer of Realty Capital Securities, LLC.

Affiliated Companies

The following information is added as the first full paragraph on page 49 of the Prospectus under the section entitled “Affiliated Companies” and also supplements footnotes (13) and (14) under the section of the Prospectus entitled “Management Compensation” on page 55 of the Prospectus.

As agreed with the Ohio Division of Securities in connection with the qualification of the offering in that state, the Advisor and the Company have agreed that any subordinated listing fee or termination payments due to the Advisor will only be paid when assets acquired during the period that the Advisor was entitled to such payments are sold or refinanced. The payment of such subordinated listing fee or termination fee will be paid by the issuance of a non-interest bearing, non-transferable promissory note in the amount of such fee. The note will be payable as the subject assets are sold or refinanced. In the event that the note is not paid in full in three years after issuance and the Company is listed, the note is convertible at the option of the Advisor into shares of the Company’s common stock.

The following disclosure replaces the second paragraph under the subsection “Dealer Manager” on page 51 of the Prospectus.

Realty Capital Securities, LLC provides certain wholesaling, sales, promotional and marketing assistance services to us in connection with the distribution of the shares offered pursuant to this prospectus. It may also sell a limited number of shares at the retail level. The compensation we will pay to Realty Capital Securities, LLC in connection with this offering is described in the section of this prospectus captioned “Management Compensation.” See also “Plan of Distribution — Compensation We Will Pay for the Sale of Our Shares.” In addition, Realty Capital Securities, LLC also serves as the exclusive dealer manager for certain other non-traded REITs that are not affiliated with us.

Management Compensation

The following disclosure is added to the third paragraph of the second column of the table on page 55 of our Prospectus under the section captioned “Management Compensation.”

American Realty Capital II, LLC will not be entitled to the Subordinated Participation in Net Sale Proceeds unless our investors have received a 6% cumulative non-compounded return on their capital contributions.

The following disclosure is added to the fourth paragraph of the second column of the table on page 55 of our Prospectus under the section captioned “Management Compensation.”

American Realty Capital II, LLC will not be entitled to the Subordinated Incentive Listing Fee unless our investors have received a 6% cumulative non-compounded return on their capital contributions

The following disclosure supplements footnotes (13) and (14) under the section of the Prospectus entitled “Management Compensation” on page 55 of the Prospectus.

As agreed with the Ohio Division of Securities in connection with the qualification of the offering in that state, the Advisor and the Company have agreed that any subordinated listing fee or termination payments due

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to the Advisor will only be paid when assets acquired during the period that the Advisor was entitled to such payments are sold or refinanced. The payment of such subordinated listing fee or termination fee will be paid by the issuance of a non-interest bearing, non-transferable promissory note in the amount of such fee. The note will be payable as the subject assets are sold or refinanced. In the event that the note is not paid in full in three years after issuance and the Company is listed, the note is convertible at the option of the Advisor into shares of the Company’s common stock.

Acquisition and Investment Policies

The following disclosure supersedes and replaces the discussion contained in the Prospectus under the section captioned “Acquisition and Investment Policies — Credit Worthy Tenants — Investment Grade” on page 71.

Investment Grade.” A tenant will be considered “investment grade” when the tenant has a debt rating by Moody’s of Baa3 or better or a credit rating by Standard & Poor’s or Fitch of BBB- or better, or its payments are guaranteed by a company with such rating. In cases where a tenant does not have a Standard & Poor’s, Moody’s or Fitch rating, we will consider a tenant to be “investment grade” if it has received a rating of 1 or 2 by the National Association of Insurance Commissioners (“NAIC”) on a debt private placement or is a wholly owned subsidiary of a parent company, constituting a majority of the parent company’s assets, and the parent company has a debt rating by Moody’s of Baa3 or better or a credit rating by Standard & Poor’s or Fitch of BBB- or better. NAIC 1 is assigned to obligations exhibiting the highest quality. Credit risk is at its lowest and the issuer’s credit profile is stable. NAIC 2 is assigned to obligations of high quality. Credit risk is low but may increase in the intermediate future and the issuer’s credit profile is reasonably stable. Changes in tenant credit ratings, coupled with future acquisition and disposition activity, may increase or decrease our concentration of investment grade tenants in the future.

Moody’s, Standard & Poor’s and Fitch’s ratings are opinions of future relative creditworthiness or expected loss based on an evaluation of franchise value, financial statement analysis and management quality. The rating given to a debt obligation describes the level of risk associated with receiving full and timely payment of principal and interest on that specific debt obligation and how that risk compares with that of all other debt obligations. It is expected that lower rated entities and obligations will default, on average, at a higher frequency than more highly rated entities and obligations.

A Moody’s debt rating of Baa3, which is the lowest investment grade rating given by Moody’s, is assigned to companies with adequate financial security. However, certain protective elements may be lacking or may be unreliable over any given period of time. Standard & Poor’s assigns a credit rating to both companies as a whole and to each issuance or class of a company’s debt. A Standard & Poor’s or Fitch credit rating of BBB-, which is the lowest investment grade rating given by Standard & Poor’s and Fitch, is assigned to companies that exhibit adequate protection parameters. However, adverse economic conditions or changing circumstances are more likely to lead to a weakened capacity of the company to meet its financial commitments. Thus, investment grade tenants will be judged by Standard & Poor’s and Fitch to have at least adequate protection parameters, and will in some cases have extremely strong financial positions.

The following disclosure supersedes and replaces the discussion contained in the Prospectus under the third paragraph of the section captioned “Acquisition and Investment Policies — Investment Decisions” on page 73.

Our Advisor will consider whether properties are leased by, or have leases guaranteed by, companies that maintain an investment grade rating by Standard & Poor’s, Moody’s Investor Services or Fitch, Inc.. Our advisor also will consider non-rated and non-investment grade rated tenants that we consider creditworthy, as described in “ — Investment Grade and Other Creditworthy Tenants” above.

Acquisition of Properties from Affiliates

The following disclosure is to be added to the section of our Prospectus entitled “Acquisition of Properties from Affiliates” on pages 82 – 84 of the Prospectus.

Effective March 31, 2009, the Board of Directors approved the recommendation of the officers of the Company that the Company not pursue any opportunities to acquire real property from an entity affiliated with its advisor, American Realty Capital Advisor, LLC. It was determined the foregoing recommendation would

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bereviewed annually by the Board of Directors. On March 9, 2010, the Board of Directors of the Company approved the recommendation of the officers of the Company that the Company continue not to pursue any opportunities to acquire real property from an entity affiliated with its advisor. The Board of Directors determined that this practice will remain in effect during the remaining term of the offering.

Section 1031 Exchange Program

The following information is to supplement the section of our Prospectus captioned “Section 1031 Exchange Program” on pages 84 – 85 of the Prospectus.

The Operating Partnership has transferred forty-nine percent (49%) of its ownership interest in the Federal Express Distribution Facility, located in Snowshoe, Pennsylvania, and a PNC Bank branch, located in Palm Coast, Florida (when we acquired this property, it was a National City Bank property; see “Real Property Investments — National City Bank Properties”), to American Realty Capital DST I (the “Trust”), a Section 1031 Exchange Program. Realty Capital Securities, LLC has offered membership interests of up to forty-nine percent (49%), or $2,567,000, in the Trust to investors in a private offering. The remaining interests of no less than 51% will be retained by the Operating Partnership. To date, cash payments of $2,567,000 have been accepted by the Operating Partnership.

The Operating Partnership has transferred forty-nine percent (49%) of its ownership interest in a PNC Bank branch location, located in Pompano Beach, Florida (when we acquired this property, it was a National City Bank property; see “Real Property Investments — National City Bank Properties”), to American Realty Capital DST II (the “Trust II”), a Section 1031 Exchange Program. Realty Capital Securities has offered membership interests of thirty-five and 2/10th percent (35.2%), or $493,802, in the Trust II to investors in a private offering. The remaining interests of no less than 64.8% will be retained by the Operating Partnership. To date, cash payments of $493,802 have been accepted by the Operating Partnership.

The Operating Partnership has transferred forty-nine percent (49%) of its ownership interest in three CVS properties, located in Smyrna, GA, Chicago, IL and Visalia, CA to American Realty Capital DST III (the “Trust III”), a Section 1031 Exchange Program. Realty Capital Securities has offered membership interests of up to forty-nine percent (49%), or $3,050,000, in the Trust III to investors in a private offering. The remaining interests of no less than fifty-one percent (51%) will be retained by the Operating Partnership. To date, cash payments of $3,050,000 have been accepted by the Operating Partnership.

The Company purchased a Walgreens property in Sealy, TX under a tenant in common arrangement (“TIC”) with a third party investor. Under the TIC arrangement, the third party assumed a forty-four percent (44%) interest in the property at the time of acquisition for an investment of $1,200,000. The remaining interest of fifty-six percent (56%) was retained by the Company. To date cash payments of $1,200,000 have been accepted by the Operating Partnership.

The Operating Partnership has transferred its ownership interest in the Reckitt Benckiser Distribution Facility, located in Tooele, UT, to ARC Cambr RB, LLC a Section 1031 Exchange Program. The Operating Partnership sold a 14.6% interest in the property for $2,500,000. The remaining interests of no less than 85.4% will be retained by the Operating Partnership. To date, cash payments of $2,500,000 have been accepted by the Operating Partnership.

The Operating Partnership shall transfer up to forty-nine percent (49%) of its ownership interest in six Bridgestone Firestone properties, located in Texas and New Mexico to American Realty Capital DST IV (the “Trust IV”), a Section 1031 Exchange Program. Realty Capital Securities has offered membership interests of up to forty-nine percent (49%), or $7,294,000, in the Trust IV to investors in a private offering. The remaining interests of no less than fifty-one percent (51%) will be retained by the Operating Partnership. To date, cash payments of $2,495,000 have been accepted by the Operating Partnership.

Real Estate Investments Summary

The following summary of real estate investments is to supplement the section of our Prospectus captioned “Real Property Investments” on pages 87 – 104 of the Prospectus.

The REIT acquired the following real estate investments:

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a FedEx Cross-Dock facility in Snowshoe, Pennsylvania (the “FedEx Property”) as its initial investment on March 5, 2008;
15 First Niagara (formerly Harleysville National Bank and Trust Company) (“First Niagara”) bank branch properties in various Pennsylvania locations (the “First Niagara Properties”) on March 12, 2008;
18 Rockland Trust Company (the “Rockland Properties”) bank branch properties in various Massachusetts locations on May 2, 2008;
2 PNC Bank (formerly National City Bank branches) in Florida (the “PNC Bank Properties”) from affiliated parties on September 16, 2008 and October 23, 2008;
6 Rite Aid properties in various locations in Pennsylvania and Ohio (the “Rite Aid Properties”) from affiliated parties on September 29, 2008;
50 PNC Bank, National Association bank branches in various locations in Pennsylvania, New Jersey and Ohio (the “PNC Properties”) on November 25, 2008;
a FedEx Freight Facility (the “Fed Ex Freight Facility”) located in Houston, TX on July 8, 2009;
a Walgreens location (the “Walgreens Property”) located in Sealy, TX on July 17, 2009;
10 newly-constructed retail stores from CVS Caremark (“CVS”) located in 9 states — Illinois, South Carolina, Texas, Georgia, Michigan, New York, Arizona, North Carolina and California on September 18, 2009 (“CVS Pharmacy Portfolio I”);
15 newly-constructed retail stores from CVS located in 11 states — Alabama, Arizona, California, Florida, Georgia, Indiana, Maine, Minnesota, Missouri, North Carolina and Nevada on November 19, 2009 (“CVS Pharmacy Portfolio II”);
a leasehold interest in a build-to-suit Home Depot Distribution Facility from the developer, located in Topeka, Kansas on December 11, 2009;
6 recently constructed Bridgestone retail stores from a developer in various locations in Oklahoma and Florida (the “Bridgestone Properties”) on various closings in December 2009 (5 locations) and January 2010 (1 location);
an Advanced Auto location (the “Advanced Auto Property”) located in Plainfield, MI on December 30, 2009;
2 Fresenius Medical Care Distribution Facilities (the “Fresenius Properties”) located in Apple Valley, CA and Shasta Lake, CA from the developer on January 29, 2010;
1 build-to-suit warehouse facility for Reckitt Benckiser located in Tooele, Utah, near Salt Lake City on February 16, 2010;
4 recently constructed restaurants from Jack In the Box, Inc. located in Desloge, Missouri, The Dalles, Oregon, Vancouver, Washington and Corpus Christi, Texas on February 24, 2010 (the “Jack in the Box Portfolio”);
12 recently constructed Bridgestone Firestone auto-centers from Mays Development Company located in Alburqueque, NM, Rockwell, TX Weatherford, TX, League City, TX, Crowley, TX, Allen, TX Pearland, TX, Austin, TX, Grand Junction, CO, Benton, AR, Wichita, KS and Baton Roach, LA on February 26, 2010 (2 locations), March 15, 2010 (4 locations) and March 31, 2010 (6 locations) (the BSFS II Portfolio);
1 recently constructed restaurant from Jack In the Box, Inc. located in Houston, TX on April 22, 2010;
1 FedEx Freight West Facility (“FedEx Freight West”) located in West Sacramento, CA on April 30, 2010;

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3 build-to-suite properties from Jared the Galleria of Jewelry located in Amherst, NY, Lake Grove, NY and Watchung, NJ on May 6, 2010;
1 build-to-suit free standing pharmacy for Walgreen Co. located in Byram, MS on May 17, 2010;
1 build-to-suit free standing restaurant for International House of Pancakes located in Hilton Head, SC on May 21, 2010;
3 build-to-suite retail auto parts stores for Advance Auto Parts, Inc. located in Harvest, Alabama, Vicksburg, Mississippi and Crystal Springs, Mississippi on June 4, 2010;
1 free standing supermarket for Super Stop and Shop located in Nanuet, New York on June 4, 2010;
2 build-to-suit free standing restaurants for International House of Pancakes located in Buford, GA and Cincinnati, OH on June 25, 2010 and June 29, 2010, respectively;
1 build-to-suite property from Jared the Galleria of Jewelry located in Plymouth, MA on June 29, 2010;
6 restaurants from Jack In the Box, Inc. located in S. Houston, TX, Victoria, TX, Beaumont, TX, Ferris, TX and Forney, TX on June 30, 2010;
1 build-to-suit free standing pharmacy for Walgreen Co. located in LeRoy, New York on June 30, 2010;
1 build-to-suit free standing retail property for Tractor Supply located in DuBois, PA on July 1, 2010; and
1 build-to-suit free standing retail property for Dollar General located in Jacksonville, FL on July 15, 2010.

The amount of the Year 1 yield based upon the contract purchase price of the acquired properties as compared to the Year 1 total rent is approximately 8.38%, which excludes contractual rent increases occurring in future years. The amounts in the following table are as of June 30, 2010 except for Tractor supply and Dollar general which are as of the acquisition date. (dollars in thousands):

             
             
  Purchase Price(1)   Current Mortgage Debt   Effective
Interest
Rate
  Portfolio- Level
Leverage
  Rent   Base Rent Increase
(Year 2)(3)
             Year 1   Year 2
Federal Express Distribution Center (PA)   $ 10,208     $ 6,965       6.29 %      68.2 %    $ 703     $ 703       3.78% and 3.65%
in years 6
and 11,
 respectively
 
Harleysville National Bank Portfolio     41,676       31,000       6.59 %      74.4 %      3,004       3,064      
 
Rockland Trust Company Portfolio     33,117       23,414       4.92 %      70.7 %      2,306       2,340       1.5% annually
 
PNC Bank (formerly National City Bank)     6,853       4,375       4.58 %      63.8 %      466       466       10% after 5 years
 
Rite Aid Portfolio     18,839       12,808       6.97 %      68.0 %      1,404       1,404      
 
PNC Bank Portfolio     44,813       32,704       5.25 %      73.0 %      2,960       2,960       10% after 5 years  
 
FedEx Freight Facility (TX)     31,692       16,184       6.033 %      51.1 %      2,580       2,580       1% increase in
years 5 and 9
 
Walgreens Location     3,818       1,550       6.64 %      40.6 %      310       310      
 
CVS Pharmacy Portfolio I     40,649       23,587       6.88 %      58.0 %      3,387       3,387       5% increase 
every 5 years  
 
CVS Pharmacy Portfolio II     59,788       32,900       6.64 %      55.0 %      4,984       4,984       5% increase 
every 5 years  
 
Home Depot Distribution Facility     23,532       12,150       6.25 %      51.6 %      1,806       1,839       2% annually  
 
Bridgestone Firestone Portfolio     15,041       3,832       6.61 %      25.48 %      1,270       1,270       6.25% every 5
years
 
Advanced Auto Location     1,730                         160       160      
 

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  Purchase Price(1)   Current Mortgage Debt   Effective
Interest
Rate
  Portfolio- Level
Leverage
  Rent   Base Rent Increase
(Year 2)(3)
             Year 1   Year 2
Fresenius Portfolio     12,462       6,068       6.72 %      48.7 %      1,023       1,023       Approximately
10% in years 
2 and 7
 
Reckit Benckieser     31,735       14,962       6.23 %      47.2 %      2,279       2,434       2.0% annually
 
Jack in the Box Portfolio     7,720       4,384       6.45 %      56.8 %      639       639      
 
Jack in the Box – Houston     2,290       971       6.26 %      42.4 %                            
BSFS II Portfolio     26,414                         2,150       2,150       6.25% every
 5 years
 
FedEx Sacramento     34,171       15,000       5.57 %      43.9 %      2,761       2,880       Increases
every 30 months
based on
CPI, min
5%/max 10%
 
Jared Jewelry     5,457                         580       580       10% increase
 every 5 years  
 
Walgreens II – Byram     5,684       3,000       5.58 %      52.78 %      453       453      
 
IHOP     2,445                         192       192
      5% increase
every 5 years
 
Advance Auto II     3,674                         308       308      
 
Super Stop & Shop     23,795                         1,784       1,784
      Increases
 approx 7.5%
 every 5 yrs  
 
IHOP II     2,300                         180       180       10% increase
every 5 years
 
IHOP III     3,319                         239       261       10% increase
every 5 years
 
Jared Jewelry II     1,635                         174       182       10% increase
every 5 years  
 
Jack in the box II     11,396                         892       892       Increase every
five years based
on CPI with
max 10%
 
Walgreens III     5,062                         385       385        
Tractor Supply     2,846                         225       225
      10% increase
every 5 years
 
Dollar General     1,228                         118       118      
 
Total Portfolio   $ 515,389       245,854       6.11 %      48.1 %      39,722       40,153  
Investment Grade Tenants (based on Rent – S&P BBB- or better)                       86 %                                     
Average Remaining Lease Term (years)(4)                       15.3                                      

(1) Purchase price includes capitalized closing costs and acquisition fees paid to American Realty Capital Advisors, LLC, as applicable.
(2) Interest rate includes the effect of in-place hedges.
(3) Increase does not take into account lease escalations that commence in future years or adjustments based on the Consumer Price Index.
(4) As of June 30, 2010 or acquisition date for July 2010 acquisitions — Primary lease term only (excluding renewal option periods).
(5) Weighted average rate as of June 30, 2010
(6) The loan has a four-year term, with the first three years considered the initial term at an interest rate of 6.25%, and a one year extension at an interest rate of 6.50%.

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The following is a summary of lease expirations for the next ten years as of June 30, 2010 (dollars in thousands):

       
Year   Expiring
Revenues
  Expiring
Leases(1)
  Square
Feet
  % of
Gross Rev
2009   $                    
2010                        
2011                        
2012                        
2013                        
2014                        
2015                        
2016     242       2       21,476       0.6 % 
2017     179       1       12,613       0.4 % 
2018     4,896       59       384,201       11.5 % 
2019                        
     $ 5,317       62 (1)      418,290       12.5 % 

(1) The 62 leases listed above are with the following tenants: FedEx, Rockland Trust Company, PNC Bank and Rite Aid.

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Real Estate Investments

The following disclosure is to be added to supplement the section of our Prospectus captioned “Real Property Investments” on pages 87 – 104 of the Prospectus.

CVS Pharmacy Portfolio II

On November 3, 2009, the REIT’s Board of Directors approved the acquisition of the CVS Properties II. On November 19, 2009, the Company acquired a portfolio of fifteen newly-constructed retail stores (the “CVS Properties II”) directly from CVS Pharmacy, Inc. The CVS Properties II contain an aggregate of approximately 199,000 square feet, located in 11 states — Alabama, Arizona, California, Florida, Georgia, Indiana, Maine, Minnesota, Missouri, North Carolina and Nevada. The aggregate purchase price is approximately $60.0 million, inclusive of all closing costs and fees.

The purchase price was financed by a combination of proceeds from the sale of the Company’s common shares and proceeds received from a five-year non-recourse, fixed-rate first mortgage loan totaling approximately $33.1 million. The fixed interest rate is 6.55% for the term of the loan.

       
Address   City   State   Total
Purchase
Price
  Compensation
to Advisor
and
Affiliate(1)
5211 Neal Trail Dr.     Walkertown       NC     $ 3,705,204           
612 N. Main St.     Creedmoor       NC       3,380,699           
1888 Ogletree Rd.     Auburn       AL       4,224,431           
4145 NW 53rd Ave.     Gainesville       FL       5,968,893           
50 Duval Station Rd.     Jacksonville       FL       4,429,342           
505 County Road 1100 N     Chesterton       IN       5,925,600           
601 Howard Simmons Rd.     East Ellijay       GA       3,825,510           
300 S. Commercial     Harrisonville       MO       3,757,909           
151 Village Walk Dr.     Holly Springs       NC       3,806,651           
384 Elm St.     Biddeford       ME       3,615,565           
7996 Brooklyn Blvd.     Brooklyn Park       MN       2,706,251           
1905 Marth Berry Blvd.     Rome       GA       3,033,849           
1081 Steamboat Pkwy.     Reno       NV       3,036,074           
180 N Dobson Rd.     Chandler       AZ       3,883,302           
9256 E. Slauson Ave.     Pico Rivera       CA       4,488,682           
Total               $ 59,787,962     $ 910,823  

(1) Compensation to advisor and affiliate includes acquisition fees and financing coordination fees.

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The CVS Properties II are net leased to CVS Pharmacy, Inc., pursuant to which CVS Pharmacy, Inc. will be required to pay all operating expenses and capital expenditures in addition to base rent, simultaneously with the acquisition of the properties. The weighted average primary lease term under this net lease arrangement is approximately 24.0 years as of July 15, 2010, having commenced simultaneous with closing, and provides for two fixed-rent options of five years each, plus eight fair market value options of five years each. The average annual base rent on a straight-line basis over the initial lease term is approximately $5.4 million. Annual rent is approximately $5.0 million for the first year of the initial lease term, and annual rent will increase by 5% every five years.

           
Address   City   State   Total
Square
Feet
Leased
  Rent Per
Square Foot
  Year 1
Rent
  Initial
Lease
Term
(Years)
5211 Neal Trail Dr.     Walkertown       NC       12,900     $ 37.72     $ 486,621       25  
612 N. Main St.     Creedmoor       NC       12,900       27.91       360,000       25  
1888 Ogletree Rd.     Auburn       AL       11,945       23.10       275,894       25  
4145 NW 53rd Ave.     Gainesville       FL       13,225       36.78       486,371       25  
50 Duval Station Rd.     Jacksonville       FL       13,225       23.19       306,725       25  
505 County Road 1100 N     Chesterton       IN       13,225       23.53       311,160       25  
601 Howard Simmons Rd.     East Ellijay       GA       13,225       22.89       302,760       25  
300 S. Commercial     Harrisonville       MO       13,225       23.60       312,086       25  
151 Village Walk Dr.     Holly Springs       NC       12,900       26.70       344,457       25  
384 Elm St.     Biddeford       ME       13,013       17.93       233,306       25  
7996 Brooklyn Blvd.     Brooklyn Park       MN       13,625       19.25       262,300       25  
1905 Marth Berry Blvd.     Rome       GA       13,225       23.70       313,494       20  
1081 Steamboat Pkwy.     Reno       NV       15,887       24.55       389,979       24  
180 N Dobson Rd.     Chandler       AZ       13,013       25.87       336,617       24  
9256 E. Slauson Ave.     Pico Rivera       CA       13,013       20.13       261,900       25  
Total                 198,546     $ 25.10     $ 4,983,670       24.7  

The Company has secured first mortgage indebtedness from Ladder Capital Finance, LLC. The following table outlines the terms of the debt financing incurred in connection with acquisitions of the CVS Properties II. The non-recourse loan will be secured by a mortgage on all of the CVS Properties II.

     
  Mortgage Debt Amount   Rate   Term
       $33,068,100       6.55%(1)       five years  

(1) Weighted average rate — interest rate on fee simple properties is 6.50%; interest rate on leasehold properties is 6.65%.

The net leases are guaranteed by CVS Caremark Corporation (“CVS”), a pharmacy services company, which provides prescriptions and related healthcare services in the United States. CVS operates through two segments, Pharmacy Services and Retail Pharmacy. The Pharmacy Service segment provides a range of prescription benefit management services, including mail order pharmacy services, specialty pharmacy services, plan design and administration, formulary management, and claims processing. This segment serves primarily employers, insurance companies, unions, government employee groups, managed care organizations and other sponsors of health benefit plans, and individuals. As of December 31, 2008, the Pharmacy Services segment operated 58 retail specialty pharmacy stores, 19 specialty mail order pharmacies, and 7 mail service pharmacies located in 26 states of the United States, Puerto Rico, and the District of Columbia. The Retail Pharmacy Segment sells prescription drugs, over-the-counter drugs, beauty products and cosmetics, photo finishing, seasonal merchandise, greeting cards, and convenience foods through its pharmacy retail stores, and online. This segment also provides health care services. As of December 31, 2008, this segment operated 6,923 retail drugstores located in 41 states and the District of Columbia; and 560 retail health care clinics in 27 states.

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CVS was founded in 1892 and is headquartered in Woonsocket, Rhode Island. CVS stock is listed on the New York Stock Exchange (NYSE: “CVS”), and has a credit rating of BBB+ by Standard & Poor’s.

CVS currently files its financial statements in reports filed with the Securities and Exchange Commission, and the following summary financial data regarding CVS are taken from such filings:

       
(Amounts in millions)   Three Months Ended
Mar. 31,
2010
  For the Fiscal Year Ended
     Dec. 31,
2009
  Dec. 31,
2008
  Dec. 29,
2007
Consolidated Statements of Operations
                                   
Net revenues   $ 23,760     $ 98,729     $ 87,472     $ 76,329  
Gross profit     4,746       20,380       18,290       16,108  
Net earnings     771       3,696       3,212       2,637  

       
(Amounts in millions)     As of the Fiscal Year Ended
     Mar. 31,
2010
  Dec. 31,
2009
  Dec. 31,
2008
  Dec. 29,
2007
Consolidated Balance Sheets
                                   
Total assets   $ 61,284     $ 61,641     $ 60,960     $ 54,722  
Long-term debt     8,454       8,756       8,057       8,350  
Shareholders’ equity     35,694       35,768       34,574       31,322  

Home Depot Distribution Facility — Topeka, Kansas

On August 25, 2009, the REIT’s Board of Directors approved the acquisition of the Home Depot Facility. On December 11, 2009, the Company acquired a leasehold interest in a build-to-suit Home Depot Distribution Facility that will service Home Depot stores in the Kansas City region (the “Home Depot Facility”). The Home Depot Facility is a “Rapid Deployment Center” of approximately 465,600 square feet located in Topeka, KS. The aggregate purchase price is approximately $23.5 million, inclusive of all closing costs and fees. The primary lease term under this net lease arrangement is twenty years, with a remaining lease term of 19.5 years at July 15, 2010 having commenced simultaneous with closing, and provides for two extensions of successive five-year terms. The average annual base rent over the initial lease term is approximately $2.2 million.

The purchase price was financed by a combination of proceeds from the sale of common shares and proceeds received from a four-year non-recourse, fixed-rate first mortgage loan totaling approximately $13.7 million. The first three years of the loan are considered the initial term with a fixed interest rate of 6.25%, and the loan includes a one-year extension option at an interest rate of 6.50%.

       
Address   City   State   Total
Purchase Price
  Compensation to
Advisor and
Affiliate(1)
5200 SW Wenger Street     Topeka       KS     $ 23,531,680     $ 365,763  

(1) Compensation to advisor and affiliate includes acquisition fees and financing arrangement fees.

The Home Depot Facility is net leased to Home Depot U.S.A., Inc. (“Home Depot”) pursuant to which Home Depot will be required to pay all operating expenses and capital expenditures in addition to base rent, simultaneously with the acquisition of the properties, and have a primary lease term of 20 years. Annual rent is approximately $1.8 million for the first year of the initial lease term, which increases 2% annually.

           
Address   City   State   Total
Square
Feet
Leased
  Rent Per
Square Foot
  Year 1
Rent
  Initial
Lease
Term
(Years)
5200 SW Wenger Street     Topeka       KS       465,600     $ 3.88     $ 1,805,961       20  

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The Company had secured first mortgage indebtedness from the seller of the Home Depot Facility,
HD Topeka, LLC of $13.6 million. This facility was subsequently refinanced with a new first mortgage loan. The following table outlines the terms of the debt financing incurred in connection with the current financing of the Home Depot Facility. The loan will be secured by a mortgage on the Home Depot Facility.

     
  Mortgage Debt Amount   Rate   Maturity Date
       $12,150,000       5.95%       July 2020  

Home Depot (NYSE: HD), together with its subsidiaries, operates as a home improvement retail company. As of the fiscal year ended February 1, 2009, Home Depot had $41.2 billion in assets, $71.3 billion in annual revenue with $2.3 billion in annual net income. Home Depot operates 2,233 retail stores worldwide. Home Depot was founded in 1978 and is based in Atlanta, Georgia. The company’s Home Depot stores sell building materials, home improvement supplies, and lawn and garden products to do-it-yourself customers, do-it-for-me (“D-I-F-M”) customers, home improvement contractors, trades people, and building maintenance professionals. Its stores also offer various installation services for D-I-F-M customers. These installation programs include products such as carpeting, flooring, cabinets, countertops and water heaters. In addition, the company provides professional installation of various products that are sold through its in-home sales programs, such as generators and heating and central air systems. Home Depot is rated BBB+ by S&P.

Home Depot files its financial statements with the Securities and Exchange Commission. The following financial information is taken from such filings:

       
(Amounts in millions)   Three Months Ended
May 2,
2010
  For the Fiscal Year Ended
     Jan. 31,
2010
  Feb. 1,
2009
  Feb. 3,
2008
Consolidated Statements of Operations
                                   
Net sales   $ 16,863     $ 66,176     $ 71,288     $ 77,349  
Gross profit     5,794       22,412       23,990       25,997  
Net earnings     725       2,661       2,260       4,395  

       
(Amounts in millions)     As of the Fiscal Year Ended
     May 2,
2010
  Jan. 31,
2010
  Feb. 1,
2009
  Feb. 3,
2008
Consolidated Balance Sheets
                                   
Total assets   $ 43,619     $ 40,877     $ 41,164     $ 44,324  
Long-term debt     7,676       8,662       9,667       11,383  
Shareholders’ equity     19,371       19,393       17,777       17,714  

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Bridgestone Portfolio

On November 3, 2009, the REIT’s Board of Directors approved the acquisition of the Bridgestone properties. The REIT acquired a portfolio of six recently-constructed Morgan Tire and Auto (“MTA”) stores in December 2009 and January 2010 (the “Bridgestone Properties”). MTA is a wholly owned subsidiary of the Bridgestone Corporation. MTA operates the stores as Hibdon Tires Plus. Bridgestone Retail Operations, LLC, as further described below, guarantees the leases. The portfolio consists of six build-to-suit, freestanding, fee-simple properties. The purchase price for the Bridgestone Properties is approximately $15.0 million including closing costs and fees paid to the advisor. The purchase price was paid with proceeds from the sale of common shares. The Bridgestone Properties are located in Oklahoma and Florida, with an aggregate of 57,336 of square feet. The current sole tenant of the properties is MTA and will remain the sole tenant on a double-net lease basis. Bridgestone Retail Operations, LLC, which is a wholly owned subsidiary of Bridgestone Americas, Inc., will guarantee the property leases.

       
Address   City   State   Purchase
Price
  Approximate
Compensation to
Advisor and
Affiliates
560 Shedeck Parkway     Yukon       OK     $ 2,517,019           
1032 W. Danforth Road     Edmond       OK       2,533,728           
7816 South Olympia Avenue     Tulsa       OK       2,628,549           
Highway I-69 & 96th Street     Owasso       OK       2,432,567           
13405 N. Pennsylvania Ave     Oklahoma City       OK       2,355,038           
1781 Blanding Blvd.     Middleburg       FL       2,576,421           
Total               $ 15,043,322     $ 147,625  

The Bridgestone Properties are double-net leased to MTA, pursuant to which the landlord is responsible for maintaining the property’s roof and structure, and the tenant is required to pay all other expenses associated with the property in addition to base rent, simultaneously with the acquisition of the properties. The Bridgestone Properties’ original lease at commencement was 15 years with an average of 13.9 years currently remaining as of July 15, 2010. The double-net leases contain contractual rental escalations of 6.25% every five years, with the landlord responsible for roof and structure. Annual rent is approximately $1.3 million for the first year of the initial lease term, and annual rent will increase by 6.25% every five years. The lease provides for four renewal options at five years each.

           
Address   City   State   Total
Square
Feet
Leased
  Rent Per
Square Foot
  Year 1
Rent
  Lease
Term
Remaining
(Years)
560 Shedeck Parkway     Yukon       OK       10,118     $ 21.00     $ 212,460        
1032 W. Danforth Road     Edmond       OK       10,118       21.14       213,882        
7816 South Olympia Avenue     Tulsa       OK       10,118       21.92       221,736        
Highway I-69 & 96th Street     Owasso       OK       9,723       21.12       205,311        
13405 N. Pennsylvania Ave     Oklahoma City       OK       9,116       21.80       198,743        
1781 Blanding Blvd.     Middleburg       FL       8,143       26.71       217,459        
Total/Lease Term
Remaining Average
                57,336     $ 21.99     $ 1,269,591       13.9  

We financed the acquisition post closing with a $3.8 million twenty-year first mortgage loan from Zions First National Bank Capital at an interest rate of 6.519%.

Bridgestone Retail Operations, LLC, the lease guarantor, is a wholly owned subsidiary of Bridgestone Americas, Inc. It consists of more than 2,200 company-owned vehicle service and tire locations across the United States, including Firestone Complete Auto Care, Tires Plus, ExpertTire and Wheel Works store locations. Bridgestone Corp. reports earnings on a consolidated basis and does not provide stand-alone financials on its subsidiaries. For the fiscal year ended December 31, 2008, Bridgestone Corp. posted net sales of $35.5 billion. Bridgestone Corporation is rated “BBB+” by S&P and “A3” by Moody’s.

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Advanced Auto Portfolio

The REIT acquired an Advance Auto store in December 2009. The 7,000 square foot facility in Plainfield, MI. was purchased for approximately $1.7 million and was paid for from the proceeds from the sale of common shares. The remaining lease term on the facility is 11.4 years as of July 15, 2010, with an annual rent of approximately $160,000.

On June 4, 2010, we acquired three build-to-suit free standing, fee simple retail auto parts stores for Advance Auto Parts, Inc. for $3,683,000 inclusive of all closing costs and fees. The properties contain 19,253 square feet of gross leasable area. The properties are located in Harvest, Alabama, Vicksburg, Mississippi and Crystal Springs, Mississippi. The tenant is Advance Co., Inc., which is rated BBB- by Standard & Poor’s.

The primary lease term is 15 years, with an average of 13.0 years currently remaining as of July 15, 2010. The leases do not contain rent escalations during the primary term and are double net whereby the landlord is responsible for roof and structure. The leases provide for three renewal options of 5 years each with 5% rental increase at each option. The average annual base rent for the initial term is approximately $308,000. The lease also provides for the payment of a percentage of sales over certain sales thresholds.

Advance Auto Parts, Inc. (NYSE: AAP) is a specialty retailer of automotive aftermarket parts, accessories, batteries and maintenance items primarily operating within the United States. The company’s stores carry a product line for cars, vans, sport utility vehicles and light trucks. Advance Auto Parts, Inc. operates in two business segments: Advance Auto Parts (“Advance Auto Parts”) and Autopart International (“Autopart International”). As of January 2, 2010, Advance Auto Parts operated 3,264 stores in Northeastern, Southeastern, and Midwestern regions of the United States as well as 26 stores in Puerto Rico and the Virgin Islands, had assets of $3.1 billion. Autopart International operates as an independent, wholly owned subsidiary primarily serving the commercial market.

Fresenius Medical Distribution Portfolio

We acquired two build-to-suit distribution facilities from Fresenius Medical Care North America, a wholly owned subsidiary of Fresenius Medical Care AG & Co. KgaA on January 29, 2010, to be leased by their wholly owned subsidiary Fresenius USA Manufacturing, Inc. (the “Fresenius Properties”). The distribution facilities are each approximately 70,000 square feet, and are located in Apple Valley, CA and Shasta Lake, CA. The aggregate purchase price was approximately $12.5 million, inclusive of all closing costs and fees.

       
Address   City   State   Purchase
Price
  Approximate
Compensation to
Advisor and
Affiliates(1)
Navajo Rd and Lafayette Street     Apple Valley       CA     $ 6,107,965           
3415 Bronze Court     Shasta Lake       CA       6,374,759           
Total               $ 12,482,724     $ 182,733  

(1) Compensation to Advisor and affiliate includes acquisition fees and financing arrangement fees.

The Fresenius Properties are double net leased whereby the landlord is responsible for roof and structure and the tenant is required to pay all other expenses. The primary lease term is 15 years, with a remaining lease term of approximately 12.0 years as of July 15, 2010, and provides for contractual rent escalations of 10% every 5 years. The lease will also provide for two 5 year renewal options. The average annual base rent on a straight-line basis over the initial lease term is approximately $1.2 million. The leases will be guaranteed by Fresenius National Medical Care Holdings, Inc. (a wholly owned subsidiary of Fresenius Medical Care AG & Co. KgaA (“Fresenius Medical Care”)) which has a senior unsubordinated rating of BB+ by Standard & Poor’s.

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Address   City   State   Total
Square
Feet
Leased
  Rent Per
Square Foot
  Year 1
Rent
  Lease
Term
Remaining
(Years)(1)
Navajo Rd and Lafayette Street     Apple Valley       CA       70,000     $ 7.15     $ 500,500        
3415 Bronze Court     Shasta Lake       CA       70,000       7.47       522,900        
Total/Lease Term
Remaining Average
                140,000     $ 7.31     $ 1,023,400       12.0  

(1) Lease term remaining average is as of July 15, 2010.

The purchase price was financed by a combination of approximately $6.1 million of proceeds received from a first mortgage loan and proceeds from the sale of common shares.

     
  Mortgage Debt Amount   Rate   Maturity Date
       $6,090,000       6.625%       February 11, 2015  

Fresenius Medical Services is a kidney dialysis company, operating in both the field of dialysis products and the field of dialysis services operating more than 1,700 outpatient dialysis clinics in the United States. The Renal Therapies Group, which was acquired by Fresenius Medical Services, is responsible for the manufacture and distribution of a variety of dialysis products and equipment, including dialysis machines, dialyzers and other dialysis related supplies.

Fresenius Medical Care AG & Co. KGaA (NYSE: FMS) is the world’s largest integrated provider of products and services for individuals with chronic kidney failure, a condition that affects more than 1.77 million individuals worldwide. Through its network of 2,509 dialysis clinics in North America, Europe, Latin America and Asia/Pacific and Africa, Fresenius Medical Care provides dialysis treatment to approximately 193,000 patients around the globe. Fresenius Medical Care is also the world’s largest provider of dialysis products such as hemodialysis machines, dialyzers and related disposable products. In the United States, it also performs clinical laboratory testing and provides inpatient dialysis services and other services under contract to hospitals. During the year ended December 31, 2008, it provided 27.9 million dialysis treatments. Fresenius Medical Care is listed on the Frankfurt Stock Exchange (FME, FME3) and the New York Stock Exchange (FMS, FMS/P).

       
(Amounts in millions)   Three Months Ended
Mar. 31,
2010
  For the Fiscal Year Ended
     Dec. 31,
2009
  Dec. 31,
2008
  Dec. 29,
2007
Consolidated Statements of Operations
                                   
Net revenues   $ 2,882     $ 11,247     $ 10,612     $ 9,720  
Net income     211       891       818       717  

       
(Amounts in millions)     As of the Fiscal Year Ended
     Mar. 31,
2010
  Dec. 31,
2009
  Dec. 31,
2008
  Dec. 29,
2007
Consolidated Balance Sheets
                                   
Total assets   $ 15,873     $ 15,821     $ 14,920     $ 14,170  
Shareholders’ equity     7,127       6,821       5,962       5,575  

Reckitt Benckiser Warehouse Facility — Tooele, UT

On February 16, 2010, we acquired a build-to-suit warehouse facility for Reckitt Benckiser. The warehouse facility is approximately 574,000 square feet, located in Tooele, Utah, near Salt Lake City. The aggregate purchase price was approximately $32.0 million, inclusive of all closing costs and fees. The primary lease term under this net lease arrangement, pursuant to which Reckitt Benckiser will be required to pay all operating expenses and capital expenditures in addition to base rent, is 12.3 years, with a remaining lease term

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of approximately 11.6 years as of July 15, 2010, and provides for annual rent escalations of 2% each year. The lease also provides for three 5 year renewal options. The average annual base rent on a straight-line basis over the initial lease term is approximately $2.7 million.

The purchase price is 50% financed by proceeds from the sale of common shares and 50% from proceeds received from a first mortgage loan totaling approximately $15.0 million.

       
Address   City   State   Purchase
Price
  Compensation to
Advisor and
Affiliates(1)
3226 Sheep Lane North     Tooele       UT     $ 31,748,538     $ 461,000  

(1) Compensation to advisor and affiliate includes acquisition fees and financing arrangement fees.

           
Address   City   State   Total Square Feet Leased   Rent Per Square Foot   Year 1
Rent
  Initial Lease Term (Years)
3226 Sheep Lane North     Tooele       UT       574,106     $ 4.16     $ 2,385,866       12.3  

The Company has secured a seven-year non-recourse first mortgage loan from Bank of Texas. The following table outlines the terms of the debt financing incurred in connection with acquisition of the warehouse facility. The loan will be secured by a mortgage on the warehouse facility.

     
  Mortgage Debt Amount   Rate   Maturity Date
       $15,000,000       6.145%(1)       February 2017  

(1) The mortgage loan is a floating rate loan that bears an interest rate based on LIBOR plus 2.85%. Simultaneously with the closing of the mortgage loan the Company entered into a swap agreement which converts the rate we will pay on the mortgage loan to a fixed rate of 6.145% for the term of the loan.

Reckitt Benckiser is a world leader in manufacturing and marketing household, health and personal care products. Reckitt Benckiser is a multinational corporation with operations in over 60 countries, manufacturing facilities in over 40 countries and sales of its products in over 180 countries.

Reckitt Benckiser has a strong portfolio led by 17 global Powerbrands which are: Finish, Lysol, Dettol, Vanish, Woolite, Calgon, Airwick, Harpic, Bang, Mortein, Veet, Nurofen, Clearasil, Strepsils Gaviscon, Mucinex and French’s. The 17 Powerbrands account for over two-thirds of Reckitt Benckiser’s net revenue. Reckitt Benckiser has an investment grade rating of A+ by Standard and Poor’s.

Reckitt Benckiser is a U.K. listed company and is part of the top 25 of the FTSE 100, with a market cap exceeding £20bn. The following financial information comes from information published by Reckitt Benckiser.

     
(Amounts in millions)(1)   Year Ended
     Dec. 31,
2009
  Dec. 31,
2008
  Dec. 31,
2007
Profit and Loss Account
                          
Total operating income   $ 12,141     $ 12,214     $ 10,580  
Operating profit     2,961       2,791       2,468  
Retained profit     2,220       1,259       1,161  

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  As of
     Dec. 31,
2009
  Dec. 31,
2008
  Dec. 31,
2007
Balance Sheets
                          
Total assets   $ 13,795     $ 13,423     $ 11,644  
Long-term debt     6       6       10  
Shareholders’ equity     6,393       4,815       4,733           

(1) Amounts reflect a conversion from British pounds to U.S. Dollars at a conversion rate specific to each period presented.

Jack in the Box Property Portfolio

On February 24, 2010, we acquired 4 recently-constructed restaurants for Jack In the Box, Inc. (“Jack”) for $8.3 million, inclusive of all closing costs and fees. The properties contain an aggregate 9,892 square feet of gross leasable area. The properties are located in Desloge, Missouri, The Dalles, Oregon, Vancouver, Washington and Corpus Christi, Texas.

The primary lease term is 20 years, having commenced simultaneous with closing with a remaining lease term of 19.6 years as of July 15, 2010. The leases contain contractual rental escalations every 5 years at the lesser of accumulated Consumer Price Index over the prior 5 year period or 10%. The leases provide for 4 renewal options of 5 years each and are triple-net, whereby Jack is required to pay substantially all operating expenses, including all costs to maintain and repair the roof and structure of the building, including the cost of all capital expenditures in addition to base rent. The average annual base rent for the initial term is approximately $639,000.

The purchase price was financed by a combination of the proceeds from the sale of the Company’s common stock and proceeds from a first mortgage loan. The Company has secured a 5 year mortgage from Wells Fargo Bank, N.A. The following table outlines the terms of the debt financing incurred in connection with the acquisition of the Jack in the Box Portfolio. The loan will be secured by a mortgage on the properties.

     
  Mortgage Debt Amount   Rate   Term
       $4,394,500
      6.36% (fixed for term)       5 Years (matures March 2015)  

On April 22, 2010, we acquired another recently-constructed restaurant for Jack located in Houston, Texas, for a purchase price of $1,816,000, inclusive of all closing costs and fees. The property contains 2,038 square feet of gross leasable area.

The property has a primary lease term of 20 years, having commenced simultaneous with closing with a remaining lease term of 19.6 years as of July 15, 2010. The lease contains a contractual rental escalation every 5 years at the lesser of accumulated Consumer Price Index over the prior 5 year period or 10%. The lease provides for 4 renewal options of 5 years each and is triple-net, whereby Jack is required to pay substantially all operating expenses, including all costs to maintain and repair the roof and structure of the building, and the cost of all capital expenditures, in addition to base rent. The average annual base rent for the initial term is approximately $142,000.

We acquired the property with proceeds from the sale of our common stock.

On May 10, 2010, we secured a 5 year mortgage from Wells Fargo Bank, N.A. The following table outlines the terms of the debt financing incurred in connection with the financing of the property. The loan is secured by a mortgage on the Jack Property.

     
  Mortgage Debt Amount   Effective Rate   Maturity Date
       $970,760       6.17%       5 years (matures June 2015)  

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On June 29, 2010, we purchased six restaurants for Jack for $11,462,450, inclusive of all closing costs and fees. The properties contain an aggregate 14,975 square feet of gross leasable area. The properties are located in South Houston, TX, Victoria, TX, Beaumont, TX, Ferris, TX and Forney, TX.

The primary lease term is 20 years, having commenced simultaneous with closing. The leases contain contractual rental escalations every 5 years at the lesser of accumulated Consumer Price Index over the prior 5 year period with a maximum increase of 10%. The leases provide for 4 renewal options of 5 years each and are triple-net, whereby Jack is required to pay substantially all operating expenses, including all costs to maintain and repair the roof and structure of the building, including the cost of all capital expenditures in addition to base rent. The average annual base rent for the initial term is approximately $892,000.

Jack in the Box, Inc. (NASDAQ: JACK) is an American fast-food restaurant company founded in 1951 in San Diego, California. Jack in the Box, Inc. (S&P: BB-) operates and franchises Jack in the Box restaurants, one of the nation’s largest fast food hamburger chains. The Jack in the Box restaurants are primarily located on the West Coast of the United States. During the fiscal year ended September 27, 2009, Jack in the Box, Inc. had 2,212 restaurants in 18 states, of which 1,190 were company-operated and the remaining 1,022 were franchise-operated. Jack in the Box has approximately 43,000 employees. The company reported revenue of $2.47 billion, net income of $118 million, had assets of $1.45 billion and a net worth of more than $524 million for the fiscal year ended September 27, 2009.

Bridgestone Firestone II Portfolio

We acquired 12 Bridgestone Firestone properties in three separate transactions, on February 26, 2010 (2 locations), March 15, 2010 (4 locations) and March 31, 2010 (6 locations) for $16.9 million, inclusive of all closing costs and fees (the BSFS II Portfolio). The BSFS II Portfolio consists of 12 recently constructed Bridgestone Firestone retail facilities. The properties contain an aggregate of 93,581 square feet and are located in Alburqueque, NM, Rockwell, TX Weatherford, TX, League City, TX, Crowley, TX, Allen, TX Pearland, TX, Austin, TX, Grand Junction, CO, Benton, AR, Wichita, KS and Baton Roach, LA. The BSFS II Portfolio properties are 100% double net leased to Bridgestone Retail Operations, LLC, a wholly owned subsidiary of the Bridgestone Corporation (S&P: BBB+). The stores operate as Firestone Complete Auto Care. The primary lease term under this net lease arrangement, pursuant to which BSFS will be required to pay all operating expenses and capital expenditures in addition to base rent, is 15 years, with a remaining lease term of approximately 13.5 years as of July 15, 2010. The leases contain contractual rental escalations of 6.25% every five years, and provide for 5 renewal options of 5 years each. The leases are double net whereby Bridgestone Operations, LLC is required to pay substantially all operating expenses, with the exception of costs to maintain and repair the roof and structure of the building. The average annual base rent on a straight-line basis over the initial lease term is approximately $2.3 million.

The acquisition of the BSFS II Properties was financed with the proceeds from the sale of common stock.

Bridgestone Retail Operations, LLC is a wholly owned subsidiary of Bridgestone Americas, Inc. It consists of more than 2,200 company-owned vehicle service and tire locations across the United States, including Firestone Complete Auto Care, Tires Plus, Expert Tire and Wheel Works store locations. Bridgestone Americas, Inc. is the U.S. subsidiary of Bridgestone Corporation, which is headquartered in Tokyo, Japan and the largest tire producer in the world. Bridgestone Corporation had assets of $30.2 billion and posted net sales of $27.9 billion for the fiscal year ended December 31, 2009.

Bridgestone Corporation is a multinational corporation with 179 production facilities in 25 countries and has one of the largest sales networks in the world, selling its products in over 150 countries. In addition to being the largest tire producer in the world, Bridgestone Corporation has diversified business segments offering various services and products including chemical and industrial products, sporting goods and bicycles.

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Federal Express Property

On April 30, 2010, we acquired one build-to-suit, free standing, fee simple distribution facility located in West Sacramento, California (the “FedEx Property”) for FedEx Freight West, Inc. (“FedEx Freight West”) for $34,212,000, inclusive of all closing costs and fees. The FedEx Property contains 118,796 square feet of gross leasable area. FedEx Freight West is a wholly owned subsidiary of the FedEx Corporation (NYSE: “FDX”), the lease guarantor.

The original lease term at commencement was 15 years with 10.9 years currently remaining as of July 15, 2010. The lease contains rental escalations equivalent to the cumulative increase in the Consumer Price Index over the previous 30 months, with a minimum increase of 5% and a maximum increase of 10%. The next rent escalation will occur on June 22, 2011. The lease provides for 3 renewal options of 5 years each followed by one renewal option of 4 years. The lease is double net with the landlord responsible for roof and structure. The average annual base rent for the initial term is approximately $3,087,000.

We financed the acquisition of the FedEx Property with a 5-year first mortgage loan from Ladder Capital Finance, LLC, proceeds from the sale of our common stock and a $3,000,000 investment from an unrelated third party. The loan from Ladder Capital Finance, LLC will be secured by a mortgage on the FedEx Property. The following table outlines the terms of the debt financing incurred in connection with the acquisition of the FedEx Property:

   
Mortgage Debt Amount   Effective Rate   Maturity Date
$15,000,000     5.49 %      5 years  

FedEx Freight West provides regional less-than-truckload transportation services in the western United States. The company transports general commodities and also provides online shipping transactions services. FedEx Freight West was founded in 1966 as Viking Delivery Service, Inc. and changed its name to Viking Freight System, Inc. in 1974 and then to Viking Freight, Inc. in 1996. It further changed its name to FedEx Freight West, Inc. in 2002. The company is based in San Jose, California. As of February 12, 2001, FedEx Freight West was acquired by FedEx Corporation.

Jared the Galleria of Jewelry Portfolio

On May 6, 2010, we acquired three build-to-suit properties from Jared the Galleria of Jewelry (“Jared”) for $5,474,000, inclusive of all closing costs and fees. The properties contain 19,534 square feet of gross leasable area and are located in Amherst, New York, Lake Grove, New York and Watchung, New Jersey.

The original leases at commencement were 20 years with 18.6 years currently remaining as of July 15, 2010. The leases provides for 4 renewal options of 5 years each and are triple net whereby Jared is required to pay substantially all operating expenses, including all costs to maintain and repair the roof and structure of the building, and the cost of all capital expenditures, in addition to base rent. The average annual base rent for the initial term is approximately $679,000.

We acquired the properties with proceeds from the sale of our common stock.

On June 29, 2010, we acquired one build-to-suit property from Jared for $1,641,489, inclusive of all closing costs and fees. The property contains 6,157 square feet of gross leasable area and is located in Plymouth, New York.

The original lease at commencement was 20 years and four months with 16.6 years currently remaining as of July 15, 2010. The leases provides for 4 renewal options of 5 years each and are triple net whereby Jared is required to pay substantially all operating expenses, including all costs to maintain and repair the roof and structure of the building, and the cost of all capital expenditures, in addition to base rent. The average annual base rent for the initial term is approximately $209,000.

We acquired the property with proceeds from the sale of our common stock. We may finance the acquisition post closing, however, there is no guarantee that we will be able to obtain financing on terms that we believe are favorable or at all.

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Jared the Galleria of Jewelry is a division of Sterling Jewelers Inc., a wholly owned subsidiary of Signet Jewelers Limited (Signet Group plc prior to September 2008, NYSE: SIG, LSE: SIG), the world’s largest specialty retail jeweler. Jared stores are free standing single point destinations. The stores retain a large selection of loose diamonds, and sell a number of exclusive ranges such as the Leo Diamond, the Leo Artisan, and the Peerless. All stores offer a large selection of prestige Swiss watch brands including Omega, Tag Heuer, MontBlanc, Movado, Baume & Mercier, Raymond Weil, Tissot, and Swiss Army. Several locations are also authorized Rolex dealers.

Walgreens Portfolio

On May 17, 2010, we acquired a build-to-suit, freestanding, fee-simple pharmacy for Walgreen Co. (“Walgreens) located in Byram, Mississippi for $5,687,000, inclusive of all closing costs and fees. The property contains 14,820 square feet of gross leaseable area. We previously purchased a Walgreens pharmacy in Sealey, Texas in July 2009.

The original lease term at commencement was 25 years with 22.7 years currently remaining as of July 15, 2010. The lease does not contain rental escalations during the primary term, consistent with all newer Walgreen leases. The lease is triple net whereby Walgreens is required to pay substantially all operating expenses, including all costs to maintain and repair the roof and structure of the building, and the cost of all capital expenditures, in addition to base rent. The average annual base rent for the initial term is $453,000.

We acquired the property with proceeds from the sale of our common stock. We have financed the acquisition post closing with a $3.0 million five year first mortgage from Loews Corporation, LLC (Continental Casualty Company), at an interest rate of 5.5%.

On June 30, 2010, we acquired a build-to-suit, freestanding, fee-simple pharmacy for Walgreens located in LeRoy, New York for $5,068,958, inclusive of all closing costs and fees. The Walgreens Property contains 13,386 square feet of gross leaseable area.

The original lease term at commencement was 25 years with 23.8 years currently remaining as of July 15, 2010. The lease does not contain rental escalations during the primary term, consistent with all newer Walgreen leases. The lease is triple net whereby Walgreens is required to pay substantially all operating expenses, including all costs to maintain and repair the roof and structure of the building, and the cost of all capital expenditures, in addition to base rent. The average annual base rent for the initial term is $385,000.

We acquired the property with proceeds from the sale of our common stock. We may finance the acquisition post closing, however, there is no guarantee that we will be able to obtain financing on terms that we believe are favorable or at all.

Walgreen Co. (NYSE: WAG) was founded in 1901 and is the nation’s largest drugstore chain based on sales. As of February 29, 2010, Walgreens operated 7,680 locations in 49 states, Washington D.C., Puerto Rico and Guam. The company has approximately 311,000 employees. Prescription sales account for about 65% of Walgreens total sales, with nearly all payments made directly by third-parties such as managed care organizations and government and private insurance companies. Approximately 5.3 million shoppers visit a Walgreens store daily.

International House of Pancakes Portfolio

On May 21, 2010, we acquired a build-to-suit, freestanding, fee-simple restaurant for International House of Pancakes (“IHOP”) located in Hilton Head, South Carolina for a purchase price of $2,449,000, inclusive of closing costs and fees. The restaurant contains 5,172 square feet of gross leaseable area. The tenant of the restaurant is IHOP Properties, Inc. and the lease is guaranteed by IHOP Corp. (now known as DineEquity, Inc.).

The original lease term at commencement was 25 years with 15.7 years currently remaining as of July 15, 2010. The lease contains contractual rental escalations of 5% every 5 years and provides three renewal options of 5 years each. The lease is triple net whereby IHOP Properties, Inc. is required to pay substantially all operating expenses, including all costs to maintain and repair the roof and structure of the building, and the cost of all capital expenditures, in addition to base rent. The average annual base rent for the initial term is approximately $201,000.

We acquired the IHOP restaurant with proceeds from the sale of our common stock.

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On June 25, 2010, we acquired a build-to-suit, freestanding, fee-simple restaurant for IHOP located in Buford, Georgia for a purchase price of $2,312,779, inclusive of closing costs and fees. The restaurant contains 4,139 square feet of gross leaseable area. The tenant of the restaurant is IHOP Properties, Inc. and the lease is guaranteed by IHOP Corp. (now known as DineEquity, Inc.).

The original lease term at commencement was 20 years with 11.7 years currently remaining as of July 15, 2010. The lease contains contractual rental escalations of 10% every 5 years and provides three renewal options of 5 years each. The lease is triple net whereby IHOP Properties, Inc. is required to pay substantially all operating expenses, including all costs to maintain and repair the roof and structure of the building, and the cost of all capital expenditures, in addition to base rent. The average annual base rent for the initial term is approximately $204,000.

We acquired the IHOP restaurant with proceeds from the sale of our common stock. We may finance the acquisition post closing, however, there is no guarantee that we will be able to obtain financing on terms that we believe are favorable or at all.

On June 29, 2010, we acquired a build-to-suit, freestanding, fee-simple restaurant for IHOP located in Cincinnati, Ohio for a purchase price of $3,318,685, inclusive of closing costs and fees. The restaurant contains 5,111 square feet of gross leaseable area. The tenant of the restaurant is IHOP Properties, Inc. and the lease is guaranteed by IHOP Corp. (now known as DineEquity, Inc.).

The original lease term at commencement was 25 years with 21.1 years currently remaining as of July 15, 2010. The lease contains contractual rental escalations of 10% every 5 years and provides three renewal options of 5 years each. The lease is triple net whereby IHOP Properties, Inc. is required to pay substantially all operating expenses, including all costs to maintain and repair the roof and structure of the building, and the cost of all capital expenditures, in addition to base rent. The average annual base rent for the initial term is approximately $303,000.

We acquired the IHOP restaurant with proceeds from the sale of our common stock. We may finance the acquisition post closing, however, there is no guarantee that we will be able to obtain financing on terms that we believe are favorable or at all.

IHOP was founded in 1958 in the Los Angeles suburb of Toluca Lake, California and is a wholly owned subsidiary of DineEquity, Inc. (NYSE: DIN). IHOP restaurants feature moderately priced, high quality food and beverage items served in an attractive and comfortable atmosphere. Although IHOP is known for its pancakes and omelets, other breakfast specialties are popular menu options with patrons in the early morning hours. IHOP restaurants are open throughout the day and evening and offer a broad array of lunch, dinner and snack favorites. As of December 31, 2009, there were 1,456 IHOP restaurants located in 50 states, Canada, Mexico, Puerto Rico and the U.S. Virgin Islands.

Super Stop & Shop Property

On June 4, 2010, we acquired a free standing, fee simple supermarket for a Super Stop & Shop (the “Stop & Shop Property”) in Nanuet, New York for $23,807,000, inclusive of all closing costs and fees. The Stop & Shop Property contains 59,032 square feet of gross leasable area. The tenant of the Stop & Shop Property is The Stop & Shop Supermarket Company (“Stop & Shop,” formerly known as “Stop & Shop, Inc.”), successor in interest to Shaw’s Supermarket, Inc. The lease is guaranteed by J. Sainsbury, plc and Koninklijke Ahold N.V. (S&P: BBB).

The original lease term at commencement was 25.5 years with 12.6 years currently remaining as of July 15, 2010. The lease contains contractual rental escalations of approximately 7.5% every 5 years and provides two renewal options of 10 years and 1 option of 4 years 3 months. The lease is triple net whereby Stop & Shop is required to pay substantially all operating expenses, including all costs to maintain and repair the roof and structure of the building, and the cost of all capital expenditures, in addition to base rent. The average annual base rent on a straight line basis for the initial term is approximately $1,946,000.

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Stop & Shop operates over 375 stores throughout the following 6 states: Massachusetts, Rhode Island, Connecticut, New Hampshire, New York, and New Jersey. The supermarket chain employs 59,000 associates from the communities where the stores are located. Stop & Shop was founded in 1914 in Somerville, Massachusetts by the Rabinowitz family as the Economy Grocery Stores Company. By 1947, Economy Grocery Stores had grown into a chain of 86 supermarkets and the name of the company was changed to Stop & Shop, Inc. In 1996, Koninklijke Ahold N.V. (“Royal Ahold”) acquired Stop & Shop, Inc. Royal Ahold is a public limited liability company registered in the Netherlands and listed on Euronext’s Amsterdam Stock Exchange. Royal Ahold is is one of the largest, international food retailing groups in the world operating leading supermarket companies in Europe and the United States.

We acquired the Stop & Shop Property with proceeds from the sale of our common stock. We have financed the acquisition post closing with a $10.8 million five year first mortgage loan from Ladder Capital at an interest rate of 5.25%.

Tractor Supply Property

On July 1, 2010, we acquired a build-to-suit, freestanding, fee-simple retail property located in DuBois, PA for $2,846,000, inclusive of all closing costs and fees. The property contains 19,097 square feet of gross leaseable area.

The original lease term at commencement was 15 years with 14.8 years currently remaining. The lease contains rental escalations of 10% every five years during the primary term, and contains three renewal options of five years each. The lease is triple net whereby Tractor Supply is required to pay substantially all operating expenses, including all costs to maintain and repair the roof and structure of the building, and the cost of all capital expenditures, in addition to base rent. The average annual base rent for the initial term is $248,000.

We acquired the property with proceeds from the sale of our common stock.

Dollar General Property

On July 15, 2010, we acquired a build-to-suit, freestanding, fee-simple retail property located in Jacksonville, FL for $1,228,000, inclusive of all closing costs and fees. The property contains 8,988 square feet of gross leaseable area.

The original lease term at commencement was 15 years with 14.5 years currently remaining. The lease does not contain rental escalations during the primary term, but contains four renewal options of five years each. The lease is triple net whereby Dollar General is required to pay substantially all operating expenses, including all costs to maintain and repair the roof and structure of the building, and the cost of all capital expenditures, in addition to base rent. The average annual base rent for the initial term is $118,000.

We acquired the property with proceeds from the sale of our common stock.

Potential Property Investments

The following disclosure supersedes and replaces the section of our Prospectus captioned “Potential Property Investments” on pages 104 – 106 of the Prospectus.

The acquisition of each property is subject to a number of conditions. A significant condition to acquiring any one of these potential acquisitions is our ability to raise sufficient proceeds in this offering to pay a portion of the purchase price. An additional condition to acquiring these properties will be our securing debt financing to pay the balance of the purchase price. Such financing may not be available on acceptable terms or at all.

Our evaluation of a property as a potential acquisition, including the appropriate purchase price, will include our consideration of a property condition report; unit-level store performance; property location, visibility and access; age of the property, physical condition and curb appeal; neighboring property uses; local market conditions, including vacancy rates; area demographics, including trade area population and average household income; neighborhood growth patterns and economic conditions; and the presence of demand generators.

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We will decide whether to acquire properties generally based upon:

satisfaction of the conditions to the acquisitions contained in the respective contracts;
no material adverse change occurring relating to the properties, the tenants or in the local economic conditions;
our receipt of sufficient net proceeds from the offering of our common stock to the public and financing proceeds to make these acquisitions; and
our receipt of satisfactory due diligence information including appraisals, environmental reports and tenant and lease information.

Our advisor has identified the properties described below as potential suitable investments for us. The acquisition of the properties is subject to a number of conditions. A significant condition to acquiring the potential acquisition is our ability to raise sufficient proceeds in this offering to pay all or a portion of the purchase price.

Prior Performance Summary

This section supersedes and replaces the discussion contained in the Prospectus under the section of our Prospectus captioned “Prior Performance Summary” on pages 117 through 123.

Prior Investment Programs

The information presented in this section represents the historical experience of the real estate programs managed over the last ten years by Messrs. Schorsch and Kahane. Investors should not assume that they will experience returns, if any, comparable to those experienced by investors in such prior real estate programs.

We intend to conduct this offering in conjunction with future offerings by one or more public and private real estate entities sponsored by American Realty Capital and their affiliates. American Realty Capital New York Recovery REIT, Inc. (“NY Recovery REIT”) and Phillips Edison — ARC Shopping Center REIT, Inc. (“Phillips Edison — ARC Shopping Center REIT”) are two American Realty Capital sponsored programs currently in registration with the U.S. Securities and Exchange Commission (the “SEC”). All of our executive officers and directors are also executive officers and directors of New York Recovery REIT. Mr. Kahane is also a director of Phillips Edison — ARC Shopping Center REIT. To the extent that these entities or others have the same or similar objectives as ours or involve similar or nearby properties, they may be in competition with the properties acquired by us. See the section entitled “Conflicts of Interest” in this prospectus for additional information.

Private Note Programs

ARC Income Properties, LLC implemented a note program that raised aggregate gross proceeds of $19.5 million. The net proceeds were used to acquire, and pay related expenses in connection with, a portfolio of 65 bank branch properties triple-net leased to RBS Citizens, N.A. and Citizens Bank of Pennsylvania. The purchase price for those bank branch properties also was funded with proceeds received from mortgage loans, as well as equity capital invested by American Realty Capital II, LLC. Such properties contain approximately 323,000 square feet with a purchase price of approximately $98.8 million. The properties are triple-net leased for a primary term of five years and include extension provisions. The notes issued under this note program by ARC Income Properties, LLC were sold by Realty Capital Securities through participating broker-dealers.

ARC Income Properties II, LLC implemented a note program that raised aggregate gross proceeds of $13.0 million. The net proceeds were used to acquire, and pay related expenses in connection with, a portfolio of 50 bank branch properties triple-net leased to PNC Bank. The purchase price for those bank branch properties also was funded with proceeds received from a mortgage loan, as well as equity capital raised by American Realty Capital Trust, Inc. in connection with its public offering of equity securities. The properties are triple-net leased with primary term of ten years with a 10% rent increase after 5 years. The notes issued under this note program by ARC Income Properties II, LLC were sold by Realty Capital Securities through participating broker-dealers. Please see the Prior Performance Tables set forth on Appendix C-3.

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ARC Income Properties III, LLC implemented a note program that raised aggregate gross proceeds of $11.2 million. The net proceeds were used to acquire, and pay related expenses in connection with the acquisition of a distribution facility triple-net leased to Home Depot. The purchase price for the property was also funded with proceeds received from a mortgage loan. The property has a primary lease term of twenty years which commenced on January 30, 2010 with a 2% escalation each year. The notes issued under this note program by ARC Income Properties III, LLC were sold by Realty Capital Securities through participating broker-dealers. Please see the Prior Performance Tables set forth on Appendix C-3.

ARC Growth Partnership, LP

ARC Growth Partnership, LP is a non-public real estate program formed to acquire vacant bank branch properties and opportunistically sell such properties, either vacant or subsequent to leasing the bank branch to a financial institution or other third-party tenant. Total gross proceeds of approximately $7.9 million were used to acquire, and pay related expenses in connection with, a portfolio of vacant bank branches. The purchase price of the properties also was funded with proceeds received from a one-year revolving warehouse facility. The purchase price for each bank branch is derived from a formulated price contract entered into with a financial institution. During the period from July 2008 to January 2009, ARC Growth Partnership acquired 54 vacant bank branches from Wachovia Bank, N.A., under nine separate transactions. Such properties contain approximately 230,000 square feet with a gross purchase price of approximately $63.6 million. As of September 30, 2009, 52 properties were sold, 28 of which were acquired and simultaneously sold, resulting in an aggregate gain of approximately $5.6 million. ARC Growth Partnership, LP mutually terminated the contractual agreement with Wachovia Bank, N.A. in March 2009, and has not acquired any vacant bank branches following this termination. ARC Growth Partnership, LP is currently in the process of selling its remaining assets. Please see the Prior Performance Tables set forth on Appendix C-3.

American Realty Capital, LLC

American Realty Capital, LLC began acquiring properties in December 2006. During the period of December 1, 2006 to December 31, 2007 American Realty Capital, LLC acquired 73 properties, totaling just over 1,767,000 square feet for an aggregate purchase price of approximately $407.5 Million. These properties included five Hy Vee supermarkets, one CVS distribution center, three CVS drug stores, ten Rite Aids, sixteen Walgreens drug stores, 15 Harleysville bank branches, a portfolio of fifteen Logan’s Roadhouse Restaurants, six Tractor Supply Company stores, one Shop N Save supermarket, and one Fed Ex cross dock facility. The underlying leases within these acquisitions ranged from 10 to 25 years before any tenant termination rights, with a dollar weighted average lease term of approximately 21 years based on rental revenue. American Realty Capital, LLC acquired no properties after December 31, 2007.

American Realty Capital, LLC has operated in three (3) capacities; joint-venture partner, or JV, sole investor and advisor.

(1) JV partner:  As indicated in the chart below, most of American Realty Capital, LLC’s properties have been acquired in joint venture with other investors, where American Realty Capital, LLC acts as advisor and American Realty Capital, LLC or its principals also act as an equity investor,
(2) Sole Investor:  American Realty Capital, LLC has also purchased properties for its own account where it is the sole investor, and
(3) Advisor:  American Realty Capital, LLC has acted as an advisor and not invested any of its or its principal’s equity in the property.

No money was raised from investors in connection with the properties acquired by American Realty Capital, LLC. All American Realty Capital, LLC transactions were done with the equity of the principals or joint-venture partners of American Realty Capital, LLC.

In instances where American Realty Capital, LLC was not an investor in the transaction, but rather an advisor, American Realty Capital, LLC typically performed the following advisory services:

Identified potential properties for acquisition
Negotiated Letters of Intent and Purchase and Sale Contracts

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Obtained financing
Performed due diligence
Closed properties
Managed properties
Sold properties

Information on properties and leasehold interests acquired by American Realty Capital, LLC during the twelve months ended December 31, 2007 (dollar amounts in thousands):

           
Tenant – Location   Investment
Structure
  Date   Number of
Buildings
  Gross Leasable Space   Mortgage Financing   Purchase Price(1)
Hy Vee – Cedar Rapids, IA     ARC-JV       December-06       1       86,240     $ 11,622     $ 13,167  
Hy Vee – W. Des Moines, IA     ARC-JV       December-06       1       79,634       10,375       11,777  
Hy Vee – W. Des Moines, IA     ARC-JV       December-06       1       80,194       12,085       13,669  
Hy Vee – Columbus, NE     ARC-JV       December-06       1       77,667       9,243       10,506  
Hy Vee – Olathe, KS     ARC-JV       December-06       1       71,312       11,203       12,698  
Walgreens – Natchez, MS     ARC-JV       December-06       1       14,820       3,910       4,568  
CVS – Vero Beach, FL     ARC-JV       December-06       1       413,747       29,750       33,891  
Walgreens – Loganville, GA     ARC-JV       December-06       1       14,490       5,610       6,563  
CVS – Chester, NY     ARC-JV       December-06       1       15,521       6,029       7,015  
Rite Aid – Shelby Township, MI     ARC-ADVISOR       December-06       1       11,180       3,086       3,928  
Rite Aid – Coldwater, MI     ARC-ADVISOR       December-06       1       11,180       2,657       3,308  
Walgreens – New Castle, PA     ARC-JV       January-07       1       14,280       4,780       5,476  
Walgreens – Holland, MI     ARC-JV       January-07       1       14,658       5,968       6,939  
Walgreens – Guynabo, PR     ARC-ADVISOR       January-07       1       15,750       9,700       11,145  
Eckerd – McDonough, GA     ARC-ADVISOR       January-07       1       13,824       3,500       4,466  
Rite Aid – New Philadelphia, OH     ARC-JV       February-07       1       11,157       4,528       5,553  
Walgreens – Clarence, NY     ARC-JV       February-07       1       14,820       4,114       4,639  
Walgreens – Carolina, PR     ARC-ADVISOR       March-07       1       15,660       8,100       9,409  
Logan’s Roadhouse Portfolio – Various Locations     ARC-JV       April-07       15       119,331       45,200       58,788  
Walgreens – Windham, ME     ARC-JV       April-07       1       14,820       6,596       7,392  
Tractor Supply Co. – Carthage, TX     ARC-JV       May-07       1       19,097       2,192       2,657  
CVS – Douglasville, GA     ARC-JV       May-07       1       14,574       4,420       5,008  
Rite Aid – Flatwoods, KY     ARC-JV       June-07       1       11,154       3,600       4,380  
Shop N Save – Moline Acres, MO     ARC-JV       June-07       1       51,538       5,675       6,840  
CVS – Haverhill, MA     ARC-JV       June-07       1       15,214       6,664       7,812  
Tractor Supply Co. – Granbury, TX     ARC-JV       June-07       1       24,764       2,586       3,275  
Tractor Supply Co. – Lubbock, TX     ARC-JV       June-07       1       29,954       3,153       3,981  
Tractor Supply Co. – Odessa, TX     ARC-JV       July-07       1       22,670       2,871       3,624  
Walgreens & Petco – North Andover, MA     ARC-JV       July-07       2       29,512       13,390       15,304  
Rite Aid – New Salisbury, IN     ARC-JV       July-07       1       14,703       2,954       3,588  
Walgreens – Hampstead, NH     ARC-JV       July-07       1       14,820       5,804       6,601  
Tractor Supply Co. – Shreveport, LA     ARC-JV       August-07       1       19,097       3,078       3,769  
Bridgestone Firestone – St. Peters, MO     ARC-ADVISOR       August-07       1       7,654       1,290       1,841  
Dollar General – Independence, KY     ARC-ADVISOR       August-07       1       9,014       580       870  
Dollar General – Florence, KY     ARC-ADVISOR       August-07       1       9,014       566       870  
Dollar General – Lancaster, OH     ARC-ADVISOR       August-07       1       9,014       590       888  
Fed Ex – Snow Shoe, PA(2)     ARC-JV       August-07       1       53,675       6,965       10,067  
Rite Aid – Salem, OH     ARC-JV       August-07       1       14,654       4,928       6,003  
Rite Aid – Cadiz, OH(2)     ARC       August-07       1       11,335       1,240       1,695  
Rite Aid – Carrollton, OH(2)     ARC       August-07       1       12,613       1,730       2,342  
Rite Aid – Lisbon, OH(2)     ARC       August-07       1       10,141       1,090       1,493  
Rite Aid – Liverpool, OH(2)     ARC       August-07       1       11,362       1,630       2,217  
Walgreens – New Bedford, MA(3)     ARC-JV       August-07       1       15,272       6,564       7,960  
Walgreens – South Yarmouth, MA(3)     ARC-JV       August-07       1       9,996       6,355       7,206  
Walgreens – Derry, NH(3)     ARC-JV       August-07       1       14,820       6,660       7,514  
Walgreens – Staten Island, NY(3)     ARC-JV       August-07       1       11,056 <