Summary
Realty Income Corporation (O) announced an amendment to its unsecured commercial paper program on July 11, 2022, increasing the maximum aggregate amount outstanding from $1.0 billion to $1.5 billion. This move allows the company to access a larger pool of short-term debt financing, providing increased financial flexibility. The proceeds from these commercial paper notes will be used for general corporate purposes. The company also confirmed that its $4.25 billion revolving credit facility will serve as a liquidity backstop for these borrowings, ensuring ample capacity to repay the notes.
Key Highlights
- 1Increased commercial paper program capacity by $500 million, from $1.0 billion to $1.5 billion.
- 2This amendment provides enhanced short-term liquidity and financial flexibility.
- 3Proceeds will be used for general corporate purposes.
- 4The company's $4.25 billion revolving credit facility acts as a liquidity backstop for the commercial paper program.
- 5Commercial paper notes will rank pari passu with other unsecured senior indebtedness.
- 6Notes are offered under customary terms in the U.S. commercial paper market.
- 7Notes are not registered under the Securities Act of 1933 and subject to exemption requirements.
Frequently Asked Questions
The increase in the commercial paper program size to $1.5 billion is intended to provide Realty Income Corporation with greater financial flexibility and enhanced short-term liquidity to fund its general corporate purposes.
Realty Income Corporation has stated that its $4.25 billion revolving credit facility will serve as a liquidity backstop, meaning it has sufficient capacity to repay the notes issued under the commercial paper program if needed.
Ranking 'pari passu' means that the commercial paper notes will have the same priority in right of payment as all of the Company's other unsecured senior indebtedness. This indicates no subordination of these new borrowings relative to existing senior debt.
No, the notes offered under the program have not been and will not be registered under the Securities Act of 1933. They are being offered in the commercial paper market under customary terms and are subject to applicable exemptions from registration requirements.