What is the main purpose of this 8-K filing?

This 8-K filing announces that Realty Income Corporation's Board of Directors has approved a revised form of employment agreement for several key executives. The purpose is to standardize and update the terms of employment, particularly regarding severance benefits in certain termination scenarios.

What are the key benefits for executives under these new employment agreements?

The new agreements provide for severance payments if an executive is terminated without 'Cause' or experiences a 'Constructive Termination.' This severance includes a period of base salary continuation, the average of the last three years' cash bonuses, and continued group medical insurance at the company's expense. The duration of these benefits is longer if the termination occurs within 12 months following a 'Change in Control.'

Are there any differences in the new agreements for different executives?

Yes, Mr. Kundrak's employment agreement follows the same form but has different durations for severance benefits. His agreement provides for 6 months of severance (salary and benefits) if terminated without cause or constructively terminated more than 12 months after a Change in Control, and 9 months if within 12 months of a Change in Control, compared to 12 and 18 months respectively for the other named executives.

What conditions must be met for an executive to receive severance pay?

For an executive to receive severance, they must execute a Severance Agreement and General Release, thereby releasing the Company from any claims related to their termination. Severance is contingent upon the successful execution of this release.

O 8-K: Material Agreements

Summary

Realty Income Corporation (O) filed an 8-K on August 24, 2006, detailing revisions to its executive employment agreements. The key development is the approval of a new form of Employment Agreement for several key officers, including Messrs. Lewis, Malino, Meurer, Pfeiffer, Collins, and Mr. Kundrak. These revised agreements aim to standardize and clarify compensation and severance terms for these executives. These new agreements are designed to provide enhanced severance packages in specific termination scenarios, particularly in the event of termination without "Cause" or upon "Constructive Termination," especially if these events occur around a "Change in Control." This offers a degree of financial security to these named executives, ensuring continued compensation and benefits for a defined period following such a termination. The filing indicates that these agreements will supersede previous arrangements upon their execution.

Key Highlights

1Realty Income Corporation (O) approved revised employment agreements for key executives.
2The new agreements apply to Messrs. Lewis, Malino, Meurer, Pfeiffer, Collins, and Mr. Kundrak.
3Revised severance packages are outlined for termination without "Cause" or upon "Constructive Termination."
4Enhanced severance benefits are provided if termination occurs before or after a "Change in Control" of the company.
5Severance includes a specified period of base salary continuation, average cash bonus, and continued group medical insurance.
6Mr. Kundrak's severance terms are slightly different from the other named executives, providing shorter durations.
7These new agreements will replace any prior employment agreements upon their execution by the executives.

REALTY INCOME CORP 8-K Report, Material Agreement (Aug 25, 2006)

Summary

Key Highlights

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