American Realty Capital Properties Announces Decision to Become Self-Managed

 American Realty Capital Properties Announces Decision to Become Self-Managed

ARCT IV Advisor Elects to Align "Incentive Payment" with Stock Price
Performance by Eliminating Stock Price Floor Used in Calculation

ARCP Continues to Actively Monitor the Impact of Recent Changes in the Capital
Markets With Respect to Pending Transactions

PR Newswire

NEW YORK, Aug. 20, 2013

NEW YORK, Aug. 20, 2013 /PRNewswire/ --American Realty Capital Properties,
Inc. ("ARCP" or the "Company") announced today that its board of directors has
determined that it is in the best interests of the Company and its
stockholders to become self-managed following the pending closings of the
previously announced acquisitions of CapLease, Inc. ("CapLease") and American
Realty Capital Trust IV, Inc. ("ARCT IV").

(Logo: http://photos.prnewswire.com/prnh/20120529/NY15147LOGO) 

DECISION TO BECOME A SELF-ADMINISTERED PUBLICLY TRADED REIT

As a result of the decision to become self-managed, the Company will be a
best-in-class, self-administered publicly traded real estate investment trust
("REIT"). The Company expects that two of its founders and current executive
officers of the Company and its current external manager, ARC Properties
Advisors, LLC (the "Manager"), Nicholas S. Schorsch and Brian S. Block, will
work directly for ARCP as Executive Chairman and Chief Financial Officer,
respectively. Messrs. Schorsch and Block are two of the key executives who
built the Company and assembled its property portfolio both prior to and since
the completion of its initial public offering in September 2011. The Company
plans to supplement the Executive Chair and CFO roles by hiring additional
executives, including a President, Chief Operating Officer and General
Counsel, for which roles the Company has recently commenced active searches.

ARCP plans to transition to self-management shortly after the consummation of
the CapLease and ARCT IV acquisitions; self-management is conditioned upon the
consummation of such transactions. In connection with becoming self-managed,
the Company expects to terminate the existing management agreement with the
Manager, enter into appropriate employment and incentive compensation
arrangements with its executives and acquire certain assets necessary for its
operations from the Manager. The Company expects to utilize certain services
of the Manager for a period following such acquisitions in order to transition
smoothly toward becoming a leading self-managed net lease REIT.

The decision to become self-managed is the result of a process begun earlier
this year by the Company's board of directors, who carefully considered the
best time and the ideal method to maximize the efficiency and effectiveness of
such a transformation. The decision to undertake this important action is
motivated by the board's continuing desire to enhance stockholder value.

The Company believes that self-management will create stockholder value for
several important reasons:

  oDue to the rapid growth of the Company's asset and revenue base over the
    past year through a mix of individual property acquisitions and strategic
    portfolio and corporate purchases, the Company believes that once the
    proposed acquisitions are completed, it will have achieved a size where
    costs related to a self-administered structure will be lower than those
    attributable to an externally advised arrangement, thereby ensuring that
    these annual costs remain among the lowest in its peer group. Upon
    completion of the transition to a self-managed structure, the Company will
    no longer incur the asset management fees payable to the Manager under its
    current management agreement. The Company previously experienced similar
    cost savings when, in connection with the closing of the acquisition of
    American Realty Capital Trust III, Inc. in February 2013, the Company
    eliminated certain fees related to its external management structure by
    hiring certain property level management and accounting personnel and
    eliminating acquisition and disposition fees;
  oThe Company will have a dedicated team of senior professionals entirely
    accountable to ARCP and whose compensation is expected to be linked in
    large part to the performance of the Company. It is currently anticipated
    that approximately 30 professionals employed by the external advisor in
    functional areas including due diligence, financial analysis, accounting
    and leasing will join ARCP's management team as direct employees. Their
    interests are expected to be closely aligned with those of the Company's
    stockholders; and
  oThe Company recognizes that institutional investors, research analysts and
    the financial press have historically viewed externally managed REITs as
    being susceptible to potential conflicts of interest, which may contribute
    to externally managed publicly listed REITs trading at lower earnings
    multiples relative to self-managed REITs. For example, high quality, large
    self-managed net lease REITs currently trade at earnings multiples of 17x
    to 18x FFO while the Company trades at 15x FFO. ARCP believes that
    potential multiple expansion as a result of becoming self-managed may
    increase the Company's delivery of stockholder value to its stockholders.

AR CAPITAL WAIVES "FLOOR" WITH RESPECT TO CALCULATION OF INCENTIVE FEE PAYABLE
IN CONNECTION WITH ARCT IV TRANSACTION

The board of directors of ARCT IV received a letter today from AR Capital, LLC
("ARC"), as the direct sole owner of American Realty Capital Trust IV Special
Limited Partner, LLC (the "Advisor"), informing the ARCT IV board that the
Advisor intends on waiving any portion of the subordinated distribution in net
sales proceeds (the "Incentive Fee") to which it would be entitled as result
of the ARCP price "floor" in the ARCT IV merger agreement that it would not
otherwise be entitled to pursuant to ARCT IV's operating partnership's limited
partnership agreement. This announcement does not impact the "floor" on the
ARCP share price used in the determination of the merger consideration due to
ARCT IV stockholders; ARCT IV stockholders will still receive the equivalent
of not less than $30.62 per share.

The Advisor is entitled to payment of the Incentive Fee from ARCT IV equal to
15% of the amount of proceeds remaining from the sale of ARCT IV, following
the return of 100% of its stockholders' capital contributions, plus a 6%
hurdle. Under the current terms of the merger agreement, because the ARCT IV
stockholders electing stock consideration will enjoy a "floor" by which their
consideration cannot fall below $30.62 per ARCT IV share, the Incentive Fee
will be based on the mix of cash and stock consideration and the $30.62 floor
price. However, the election to forego the benefit of the "floor" and allow
that the calculation of the Incentive Fee instead will be based on the
five-day volume weighted average price of ARCP common stock leading up to the
closing of the transaction, regardless of the trading price of ARCT IV common
stock. Therefore, the Advisor has foregone certainty in its Incentive Fee to
ensure that ARC's compensation (through its ownership of the Advisor) will be
tied to the performance of ARCP common stock, rather than the "floor."

An example of the potential differences in the Incentive Fee resulting from
the elimination of the "floor" follows: (a) using the current "floor" of
$30.62 per ARCT IV share, the Incentive Fee would not be less than $65.2
million, irrespective of the price at which the ARCP shares are trading at the
time of the closing of the transaction; compared to, (b) without the "floor,"
using the 5-day volume weighted average price of ARCP of $13.12 through the
close of trading on August 19th, the Incentive Fee is approximately $33.5
million, based on an ARCT IV share price of $27.67 (i.e., $13.12 x 2.05 fixed
exchange ratio and assuming ARCT IV shareholders elect the full amount of the
cash consideration available in the transaction (i.e., 25% of ARCT IV
outstanding shares at $30.00 per share)). In this example, the reduction in
the Incentive Fee from dropping the "floor" is $31.7 million.

This elective modification by ARC is another example of its focus on best
practices in the non-traded REIT industry, specifically the alignment of
interests between management and shareholders.

ARCP CONTINUES TO ACTIVELY MONITOR THE IMPACT OF RECENT CHANGES IN THE CAPITAL
MARKETS WITH RESPECT TO PENDING TRANSACTIONS

ARCP also announced today that it would continue to actively monitor the
impact of the recent challenging conditions in the capital markets on ARCP's
pending transactions, including the acquisition of ARCT IV. The entire ARCP
board of directors, including the independent directors, remains fully
supportive of all ARCP's pending transactions, including the transaction with
ARCT IV. The stockholder votes with respect to the ARCT IV transaction are at
least weeks away.

About ARCP

ARCP is a publicly traded Maryland corporation listed on The NASDAQ Global
Select Market that qualified as a REIT for U.S. federal income tax purposes
beginning in the taxable year ended December 31, 2011, focused on acquiring
and owning single tenant freestanding commercial properties subject to net
leases with high credit quality tenants. Additional information about ARCP can
be found on its website at www.arcpreit.com. ARCP may disseminate important
information regarding the company and its operations, including financial
information, through social media platforms such as Twitter, Facebook and
LinkedIn.

Additional Information about the CapLease Merger and Where to Find It

This communication does not constitute an offer to sell or the solicitation of
an offer to buy any securities or a solicitation of any vote or approval. In
connection with the proposed CapLease merger, CapLease filed a definitive
proxy statement on Schedule 14A with the Securities and Exchange Commission
("SEC") on July 31, 2013 and a form of proxy was mailed to CapLease's common
stockholders. The proxy statement contains important information about the
proposed CapLease merger and related matters. STOCKHOLDERS ARE URGED TO READ
THE PROXY STATEMENT (INCLUDING ALL AMENDMENTS AND SUPPLEMENTS THERETO) AND
OTHER RELEVANT DOCUMENTS FILED BY ARCP OR CAPLEASE WITH THE SEC CAREFULLY IF
AND WHEN THEY BECOME AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION
ABOUT ARCP, CAPLEASE AND THE PROPOSED CAPLEASE MERGER.

Investors and security holders of CapLease will be able to obtain free copies
of the proxy statement and other relevant documents filed by CapLease with the
SEC (if and when then become available) through the website maintained by the
SEC atwww.sec.gov. Copies of the documents filed by CapLease with the SEC are
also available on CapLease's website atwww.caplease.com, and copies of the
documents filed by ARCP with the SEC are available on ARCP's website
atwww.arcpreit.com.

The directors, executive officers and employees of CapLease may be deemed
"participants" in the solicitation of proxies from stockholders of CapLease in
favor of the proposed CapLease merger. Information regarding the persons who
may, under the rules of the SEC, be considered participants in the
solicitation of the stockholders of CapLease in connection with the proposed
CapLease merger will be set forth in the proxy statement and the other
relevant documents to be filed with the SEC. You can find information about
CapLease's executive officers and directors in its Annual Report on Form 10-K
for the fiscal year ended December 31, 2012 and in its definitive proxy
statement filed with the SEC on Schedule 14A on April 19, 2013.

Additional Information about the ARCT IV Merger and Where to Find It

This communication does not constitute an offer to sell or the solicitation of
an offer to buy any securities or a solicitation of any vote or approval. In
connection with the proposed ARCT IV merger, ARCP and ARCT IV expect to
prepare and file with the SEC a joint proxy statement and ARCP expects to
prepare and file with the SEC a registration statement on Form S-4 containing
a joint proxy statement/prospectus and other documents with respect to ARCP's
proposed acquisition of ARCT IV. INVESTORS ARE URGED TO READ THE JOINT PROXY
STATEMENT/PROSPECTUS (INCLUDING ALL AMENDMENTS AND SUPPLEMENTS THERETO) AND
OTHER RELEVANT DOCUMENTS FILED WITH THE SEC IF AND WHEN THEY BECOME AVAILABLE
BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT THE PROPOSED ARCT IV
MERGER.

Investors may obtain free copies of the registration statement, the joint
proxy statement/prospectus and other relevant documents filed by ARCP and ARCT
IV with the SEC (if and when they become available) through the website
maintained by the SEC atwww.sec.gov. Copies of the documents filed by ARCP
with the SEC are also available free of charge on ARCP's website
athttp://www.arcpreit.com, and copies of the documents filed by ARCT IV with
the SEC are available free of charge on ARCT IV's website
athttp://www.arct-4.com.

ARCP, ARCT IV, ARC and their respective directors and executive officers may
be deemed to be participants in the solicitation of proxies from ARCP's and
ARCT IV's stockholders in respect of the proposed ARCT IV merger. Information
regarding ARCP's directors and executive officers can be found in ARCP's
definitive proxy statement filed with the SEC on April 30, 2013. Information
regarding ARCT IV's directors and executive officers can be found in ARCT IV's
definitive proxy statement filed with the SEC on April 30, 2013. Additional
information regarding the interests of such potential participants will be
included in the joint proxy statement/prospectus and other relevant documents
filed with the SEC in connection with the proposed ARCT IV merger if and when
they become available. These documents are available free of charge on the
SEC's website and from ARCP or ARCT IV, as applicable, using the sources
indicated above.

Forward-Looking Statements

Information set forth herein (including information included or incorporated
by reference herein) contains "forward-looking statements" (as defined in
Section 21E of the Securities Exchange Act of 1934, as amended), which reflect
ARCP's, CapLease's and ARCT IV's expectations regarding future events. The
forward-looking statements involve a number of risks, uncertainties and other
factors that could cause actual results to differ materially from those
contained in the forward-looking statements. Such forward-looking statements
include, but are not limited to, whether and when ARCP will become
self-managed and the terms of any arrangements related thereto, whether and
when the transactions contemplated by either of the merger agreements will be
consummated, the combined company's plans, market and other expectations,
objectives, intentions, as well as any expectations or projections with
respect to the combined company, including regarding future dividends and
market valuations, and estimates of growth, including funds from operations
and adjusted funds from operations, and other statements that are not
historical facts.

The following additional factors, among others, could cause actual results to
differ from those set forth in the forward-looking statements: (1) the
occurrence of any event, change or other circumstances that could give rise to
the termination of either of the merger agreements; (2) the inability to
complete either of the proposed mergers due to the failure to obtain CapLease
stockholder approval for the CapLease merger, ARCP stockholder approval to
issue shares to ARCT IV stockholders in the ARCT IV merger, ARCT IV
stockholder approval of the ARCT IV merger or the failure to satisfy other
conditions to completion of either of the mergers, including that a
governmental entity may prohibit, delay or refuse to grant approval for the
consummation of one or both of the mergers; (3) risks related to disruption of
management's attention from the ongoing business operations due to the
proposed mergers; (4) the effect of the announcement of the proposed mergers
on CapLease's, ARCT IV's or ARCP's relationships with its customers, tenants,
lenders, operating results and businesses generally; (5) the outcome of any
legal proceedings relating to the mergers or the merger agreements; and (6)
risks to consummation of the mergers, including the risk that the mergers will
not be consummated within the expected time period or at all. Additional
factors that may affect future results are contained in ARCP's, ARCT IV's and
CapLease's filings with the SEC, which are available at the SEC's website
atwww.sec.gov. ARCP, ARCT IV and CapLease disclaim any obligation to update
and revise statements contained in these materials based on new information or
otherwise.

SOURCE American Realty Capital Properties, Inc.

Website: http://www.arcpreit.com
Contact: From: Anthony J. DeFazio, DDCWorks, tdefazio@ddcworks.com, Ph:
(484-342-3600); For: Brian D. Jones, COO, American Realty Capital Properties,
Inc., bblock@arlcap.com, Ph: (212-415-6500); Media: Jonathan Keehner / Taylor
Ingraham, Joele Frank, Wilkinson Brimmer Katcher, Ph: (212-355-4449)
 
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