8-KMaterial AgreementsExhibits & Filings

REALTY INCOME CORP 8-K Report, Material Agreement (Aug 26, 2005)

Filed August 26, 2005For Securities:O

Summary

Realty Income Corporation (O) announced on August 25, 2005, the approval of a new form of amended and restated indemnification agreement for its executive officers and directors. This updated agreement aims to enhance the protections afforded to these individuals by the company. The key changes include provisions for independent counsel to determine indemnification rights during a "change of control," entitlement to indemnification for settlements, a presumption of indemnification for the indemnitee with the burden of proof on the company, and expanded procedural rights including arbitration and the company's ability to take over defense of proceedings. These changes are intended to ensure robust legal and financial protection for key personnel.

Key Highlights

  • 1Realty Income Corporation (O) has entered into a new form of amended and restated indemnification agreement.
  • 2The agreement applies to all executive officers and directors of the Company.
  • 3Key enhancements include indemnification for settlements of suits.
  • 4A 'change of control' scenario will now involve determination by independent counsel selected by the indemnitee.
  • 5The burden of proof shifts to the Company to demonstrate an indemnitee is not entitled to indemnification.
  • 6The agreement provides for arbitration as a procedural right for indemnitees.
  • 7The Company retains the option to take over the defense of proceedings.
  • 8The new agreement supersedes all previous indemnification agreements.

Frequently Asked Questions

The primary purpose of this filing is to announce that Realty Income Corporation's Board of Directors has approved a new form of indemnification agreement for its executive officers and directors. This agreement outlines the terms under which the company will indemnify these individuals for certain actions taken in their capacity as officers or directors.

The new agreement strengthens protections by ensuring indemnification for settlements, establishing a presumption of indemnification for the indemnitee (shifting the burden of proof to the company), and introducing procedures for independent counsel to determine entitlement during a 'change of control.' It also includes provisions for arbitration and the company's ability to assume defense of proceedings.

In the event of a 'change of control,' the determination of an indemnitee's entitlement to indemnification will be made by independent counsel, selected by the indemnitee with reasonable approval from the Board. This provides an objective review process.

This filing primarily concerns corporate governance and executive protection. While it increases the company's potential liabilities to its officers and directors, it is a standard practice for public companies and is not expected to have immediate direct financial implications for shareholders beyond reinforcing the company's commitment to retaining and protecting its leadership.