Summary
Realty Income Corporation (O) filed an 8-K on September 30, 2013, to disclose a performance-based restricted stock award granted to its Chief Executive Officer, John P. Case. This award, totaling 51,454 shares, is designed to align executive compensation with key company performance metrics and is contingent upon achieving specific annual targets. The vesting of these shares is tied to seven distinct performance metrics, including normalized AFFO per share growth, dividend per share growth, and various coverage and leverage ratios, as well as portfolio occupancy and acquisition activity. The award structure provides for tiered vesting based on performance levels ranging from 'Poor' to 'Outstanding,' with potential payouts ranging from 75% to 200% of a defined tranche of shares per metric. The total award is capped at 51,454 shares, with a maximum of 12,864 shares vesting per year.
Key Highlights
- 1Grant of 51,454 performance-based restricted stock shares to CEO John P. Case.
- 2Award vests over four years (2013-2016) based on achieving annual performance metrics.
- 3Vesting is tied to seven specific metrics: AFFO per share growth, dividend per share growth, interest coverage ratio, fixed charge coverage ratio, debt to adjusted EBITDA, portfolio occupancy, and acquisitions.
- 4Performance thresholds range from 'Poor' to 'Outstanding,' with payout multipliers from 0% to 200% of specified tranches.
- 5Maximum annual vesting is capped at 12,864 shares, and the total award is capped at 51,454 shares.
- 6The award includes provisions for accelerated vesting in the event of a change in control, death, disability, or termination without cause/for good reason.