ARCT ARC Daily NAV ARCT III ARCT IVarct-4.com/ARCT-IV_InvestorPresentation.pdf · AmericanFinancial...

American Realty Capital Trust IV, Inc.American Realty Capital Trust IV, Inc.

THIS IS NEITHER AN OFFER TO SELL NOR A SOLICITATION OF AN OFFER TO BUY THE SECURITIES DESCRIBED HEREIN. AN OFFERING IS MADE ONLY BY PROSPECTUS. THISLITERATURE MUST BE PRECEDED OR ACCOMPANIED BY A CURRENT PROSPECTUS. AS SUCH, A COPY OF THE CURRENT PROSPECTUS MUST BE MADE AVAILABLE TO YOU INCONNECTION WITH THIS OFFERING AND SHOULD BE READ IN ORDER TO UNDERSTAND FULLY ALL OF THE IMPLICATIONS AND RISKS OF THIS OFFERING. No offering is madeexcept by a prospectus filed with the Department of Law of the State of New York. Neither the Attorney-General of the State of New York nor any other state or federal regulator has passed on orendorsed the merits of this offering or these securities or confirmed the adequacy or accuracy of the prospectus. Any representation to the contrary is unlawful. All information contained in thismaterial is qualified in its entirety by the terms of the current prospectus. The achievement of any goals is not guaranteed.

ARCT1 ARC Daily NAV2 ARCT III3 ARCT IV4

REFERENCE: (1) American Realty Capital Trust, Inc. (“ARCT”). (2) American Realty Capital Daily Net Asset Value Trust, Inc. (“ARC Daily NAV”). (3) American Realty Capital Trust III, Inc. (“ARCT III”). (4) American Realty Capital Trust IV, Inc. (“ARCT IV”).

American Realty Capital Trust IV, Inc.

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“Our continuing goal is to redefine the meaning of ‘best practices’ in the non-traded REIT industry. This means constantly urging on the industry greater transparency and a better alignment of interests between management and investors. ARCT IV is a shining example of our commitment to these important principles.”

− Nicholas S. SchorschChairman and Chief Executive Officer

American Realty Capital Trust IV, Inc.Risk Factors

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Investing in our common stock involves a high degree of risk. You should purchase these securities only if you can afford a complete loss of your investment. See the section entitled “Risk Factors” beginning on page 24 of the prospectus for a discussion of the risks which should be considered in connection with your investment in our common stock, including:Distributions are not guaranteed. Due to the risks involved in the ownership of real estate, there is no guarantee of any

return on your investment, and you may lose all or a portion of your investment. We are a “blind pool” offering because we currently do not own any properties and we have not identified any properties to

acquire. Since we have neither identified nor acquired any investments, you will not have the opportunity to evaluate the merits and/or demerits of such investments. We are depending on our advisor to select investments and conduct our operations. Adverse changes in the financial

condition of our advisor or our relationship with our advisor could adversely affect us. No public market exists for our shares of common stock, nor may a public market ever exist and our shares are illiquid. There are substantial conflicts among the interests of our investors, our interests and the interests of our advisor, sponsor,

dealer manager and our and their respective affiliates regarding compensation, investment opportunities and management resources. Our investment objectives and strategies may be changed without stockholder consent. We are obligated to pay substantial fees to our advisor, which may result in our advisor recommending riskier investments. We may incur substantial debt, which could hinder our ability to pay distributions to our stockholders or could decrease the

value of your investment if income on, or the value of, the property securing the debt falls.

American Realty Capital Trust IV, Inc.Risk Factors (cont.)

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Our organizational documents permit us to pay distributions from any source. Until substantially all the proceeds from this offering are invested, we may use proceeds from this offering and financings to fund distributions until we have sufficient cash flow. There are no established limits on the amounts of net proceeds and borrowings that we may use to fund such distribution payments. Any of these distributions may reduce the amount of capital we ultimately invest in properties and other permitted investments and negatively impact the value of your investment.Our failure to qualify or remain qualified as a REIT would result in higher taxes, may adversely affect our operations, would

reduce the amount of income available for distribution and would limit our ability to make distributors to our stockholders. After the fiscal quarter in which we acquire at least $1.2 billion in total portfolio assets, the purchase price and redemption

price for our shares, including shares sold pursuant to our distribution reinvestment plan, will be based on NAV, which may not accurately reflect the value of our assets. No public market exists for our shares of common stock, no may a public market ever exist. There are limitations on ownership and transferability of our shares. Please see "Description of Securities--Restrictions on Ownership and Transfer." Our quarterly NAV will be based upon subjective judgments, assumptions and opinions about future events, and may not be

accurate. As a result, our quarterly NAV per share may not reflect the amount that you might receive for your shares in a market transaction and if you purchase shares on the day that we calculate NAV, you will not know the NAV per share at the time of purchase. It may be difficult to accurately reflect material events that may impact our quarterly NAV between valuations and accordingly we may be selling and repurchasing shares at too high or too low a price. The management of multiple REITs by our executive officers and officers of our advisor may significantly reduce the amount

of time spent on activities related to us and cause other conflicts of interest, which may cause operating results to suffer.We will compete for investors with other programs of our sponsor.


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ARCTIV


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www.arct-4.com

The properties pictured above are owned by ARCT, and not by ARCT IV, nor does ARCT IV intend to own any of these properties. These photographs are for illustrative purposes only.

1 “Investment grade” is a determination made by major credit rating agencies, “creditworthy” is a determination made by the Company.

American Realty Capital Trust IV, Inc. (“ARCT IV”) sets a new standard among American Realty Capital’s (“ARC”) suite of three other publicly registered, real estate investment trust (“REIT”)offerings, (which include the current exchange-traded, American Realty Capital Trust, Inc., and the two non-traded, American Realty Capital Daily Net Asset Value Trust, Inc., and American Realty Capital Trust III, Inc.),targeting freestanding, single-tenant properties net leased long-term to primarily investment grade and other creditworthy tenants.1ARCT IV continues to adhere to all of the “best practices” required of all of American Realty Capital’s investment solutions. The offering’s investment focus is identical to that of the other two offerings in the suite, as well as American Realty Capital Trust, Inc., our first company to successfully internalize management at no cost to shareholders and which listed its shares on NASDAQ back on March 1, 2012.


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Why ARCT IV?

Why ARCT IV?The Company: Intends to focus on necessity-based real estate sector Seeks to acquire assets at price levels within the current

economic cycle; and has no legacy assets Intends to capitalize on off-market transaction

opportunities Is managed by a seasoned investment team with

experience acquiring over $8 billion of real estate and real estate related assets Intends to pay distributions from the commencement of

the offering(1)

(1) Distributions are not guaranteed. We may not be able to pay or maintain distributions and they are subject to change at any time. Until we generate operating cash flows sufficient to pay distributions, we may pay distributions from the net proceeds of our offering, from our borrowings, or from other sources. Payment of fees to our advisor as well as the payment of operating expenses will reduce cash available for distributions. We currently have not paid any distributions.


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The Right Expertise

ARCTIV

American Realty Capital Trust IV, Inc.Experienced Management Team

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Mr. Schorsch founded and formerly servedas President, CEO and Vice-Chairman ofAmerican Financial Realty Trust from itsinception as a REIT in September 2002until August 2006. American FinancialRealty Trust (“AFRT”) was a publiclytraded REIT listed on the NYSE thatinvested exclusively in offices, operationscenters, bank branches and otheroperationally critical real estate assets thatwere net leased to tenants in the financialservices industry, such as banks andinsurance companies. Through AmericanFinancial Resource Group and its successorcorporation, American Financial RealtyTrust, Mr. Schorsch executed in excess of1,000 acquisitions with a transactionalvalue of approximately $5 billion. In 2003,Mr. Schorsch received an Entrepreneur ofthe Year award from Ernst & Young. Mr.Schorsch was a board member of NAREITfrom 2005 to 2006.

Nicholas S. SchorschChairman & CEO

Michael WeilPresident & COO

In addition to his role with ARCT IV, Mr.Weil has been the chief executive officer ofRCS since March 2010. Mr. Weil has alsobeen an executive officer of the Advisor andProperty Manager since their formation inNovember 2009. He was formerly theSenior Vice President of Sales and Leasingfor AFRT and its predecessor company,where he was responsible for the dispositionand leasing activity for a 33 million squarefoot portfolio. Under the direction of Mr.Weil, his department was the solecontributor in the increase of occupancy andportfolio revenue through the sales of over200 properties and the leasing of over 2.2million square feet, averaging 325,000square feet of newly executed leases perquarter. After working at AFR, fromOctober 2006 to May 2007, Mr. Weil wasmanaging director of Milestone PartnersLimited and prior to joining AFR, from July1987 to April 2004, Mr. Weil was presidentof Plymouth Pump & Systems Co.

Mr. Budko founded and formerly served asManaging Director and Group Head of theStructured Asset Finance Group, a divisionof Wachovia Capital Markets, LLC (NYSE:WB) from 1997-2006. The StructuredAsset Finance Group structures and investsin real estate that is net leased to corporatetenants. While at Wachovia, Mr. Budkoacquired over $5 billion of net leased realestate assets. From 1987-1997, Mr. Budkoworked in the Corporate Real EstateFinance Group at NationsBank CapitalMarket (predecessor to Bank of AmericaSecurities) becoming head of the group in1990.

Peter M. BudkoChief Investment Officer

Mr. Block is responsible for the accounting,finance and reporting functions at AmericanRealty Capital ("ARC"). He has extensiveexperience in SEC reporting requirements aswell as REIT tax compliance matters, andhas been instrumental in developing ARC'sinfrastructure and positioning the organ-ization for growth. Mr. Block began hiscareer in public accounting at Ernst & Youngand Arthur Andersen from 1994 to 2000.Subsequently, Brian was the Chief FinancialOfficer of a venture capital-backed tech-nology company for several years prior tojoining American Financial Realty Trust(AFRT) in 2002. While at AFRT, Mr. Blockserved as Chief Accounting Officer from2003 to 2007 and oversaw the financial,administrative and reporting functions of theorganization. He is a certified publicaccountant, a member of the AICPA andPICPA, and serves on the REIT Committeeof the Investment Program Association.

Brian S. BlockChief Financial Officer

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American Realty Capital Trust, Inc.Now Publicly Traded on NASDAQ: ARCT

The performance history of ARCT should not be considered indicative of ARCT IV’s possible operations. ARCT IV will own a portfolio of properties similar to but separate from those owned by ARCT.

ARCT

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American Realty Capital Trust – Portfolio (As of June 30, 2012)

Past performance is not indicative of future results. (1) The property portfolio information detailed to the right reflects data that is included in the American Realty Capital Trust, Inc.’s Form 10-Q filed with the S.E.C on July 31, 2012.(2) As a percentage of average annual rent. “Investment grade” is a determination made by major credit rating agencies.

Those who invest in ARCT IV will not have an ownership interest in ARCT.Past performance is not indicative of future results

--- Portfolio highlights and map (shown above), only reflect information on ARCT, not ARCT IV ---

ARCT Portfolio Highlights(Reflects information for ARCT, not ARCT IV)

Properties: 486

States: 43 + Puerto Rico

Number of Tenants: 62

Total Square Feet: 15.6 million

Total Square Feet Leased: 15.6 million

Annualized Rental Income: $175 million

Contracted Purchase Price: $2.15 billion

Average Remaining Lease Term: 13.0 years

American Realty Capital Trust – Industry Diversity (As of June 30, 2012)

(1) The property portfolio information detailed to the right (percentages based on annualized rental income) reflects data that is included in the American Realty Capital Trust, Inc.’s Form 10-Q filed with the S.E.C on July 31, 2012.

12Past performance is not indicative of future results.

Pharmacy 17.4%Freight 16.9%Specialty Retail 9.5%Healthcare 7.9%Retail Banking 6.5%Discount Retail 5.8%Manufacturing 5.6%Government Services 4.6%Restaurant 4.3%Auto Services 4.1%Consumer Products 3.4%Home Maintenance 2.6%Supermarket 2.5%Gas/Convenience 2.5%Auto Retail 1.6%Technology 1.5%Consumer Goods 1.1%Financial Services 1.1%Aerospace 0.6%Telecommunications 0.6%

Pharmacy, 17.4%

Freight, 16.9%

Specialty Retail, 9.5%

Healthcare, 7.9%

Retail Banking, 6.5%

Discount Retail, 5.8%

Manufacturing, 5.6%

Restaurant, 4.3%Government Services, 4.6%

Auto Services, 4.1%

4Consumer Products, 3.5%

Home Maintenance,

2.7%

6Supermarket, 2.5%

Gas/Convenience, 2.5%

Auto Retail, 1.6%Technology, 1.5% Financial Services,

1.1%Aerospace, 0.6% Telecommunicatio

ns, 0.6%

20 Distinct Industries


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ARCTIV


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Primary Objectives*

Preservation of Capital – Seeks to preserve and protect capital by investing in what we believe are well-located properties occupied by primarily investment grade and creditworthy tenants (1)

Growth – Seeks to provide for potential appreciation through contractual rent growth

Cash Distributions – Seeks to create durable investor cash flows through regular monthly distributions (2)

ARCT IV seeks to provide its investors:

ARCT IV

*There can be no assurance that we will achieve any of our stated goals or objectives.

(1) “Investment grade” is a determination made by major credit rating agencies, and “creditworthy” tenants are as determined by the Company.(2) Distributions are not guaranteed. We may not be able to pay or maintain distributions and they are subject to change at any time. Until we generate operating cash flows sufficient to pay distributions, we may pay distributions from the net proceeds of our offering, from our borrowings, or from other sources. Payment of fees to our advisor as well as the payment of operating expenses will reduce cash available for distributions. We currently have not paid any distributions.

ARCT IV

ARCT IV

American Realty Capital Trust IV, Inc.Investment Strategy*

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Investment Strategy*

Execute primarily triple-net leases with the following objectives:

– 10 to 25 year lease terms– Seek annual rent increases– No landlord responsibilities

Buy freestanding, single-tenant properties at the corner of “Main & Main” or in strategic locations

Assemble a portfolio that is diversified by tenant, industry and geography

Purchase property leased to corporate tenants, primarily investment grade (1)

(S&P rated BBB- or better)

Provide cash distributions, paid monthly, that have the potential to grow over time. (2)

ARCT IV

ARCT IV

ARCT IV

ARCT IV

ARCT IV

* There can be no assurance that we will achieve any of our stated goals or objectives. The credit quality of a tenant may change over the term of the lease.(1) “Investment grade” is a determination made by major credit rating agencies.(2) Distributions are not guaranteed. We may not be able to pay or maintain distributions and they are subject to change at any time. Until we generate operating cash flows sufficient to pay distributions, we may pay distributions from the net proceeds of our offering, from our borrowings, or from other sources. Payment of fees to our advisor as well as the payment of operating expenses will reduce cash available for distributions. We currently have not paid any distributions.

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Considering the Opportunity

LEGEND

= An Opportune Time to Buy

NCREIF Transaction Based Index: An equal-weighted transaction and appraisal index based onproperties that were in the NCREIF Property Index(NPI) and were sold that quarter. The purpose of thisindex is to measure market movements and returns oninvestment based on transaction prices of real estateproperties sold from the NCREIF Index database. Realestate is sensitive to certain economic factors such asinterest rate changes and market recessions, and there isno guarantee of profitability. NCREIF data reflects thereturns of a blended portfolio of institutional qualityreal estate and does not reflect the use of leverage or theimpact of management and advisory fees.

10-Year U.S. Treasury Bill: This metric is used torepresent the Treasury Bill benchmark. Additionally,income received from U.S. Treasuries is specified at thetime of purchase as an interest rate and mostimportantly, is backed by the U.S. government.

5.38%

0.79%

5.37% 5.07%

2.54%

Sources: NCREIF TBI, U.S. Department of the Treasury

Real Estate, As Measured by NCREIF, Historically Provided Investors a Positive Yield Spread to the 10-Year U.S. Treasury Bond

0.00%

1.00%

2.00%

3.00%

4.00%

5.00%

6.00%

Rat

e (%

)

There is no guarantee that these market conditions will continue or be profitable.

The risk-adjusted spread offered on real estate may make this an opportune time to invest in real estate.


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Road Map

Road Map Rules of the Road Avoiding Potential Road Blocks

Tenant Quality ► Conduct thorough credit review ► No defaults► No rental income interruption

Lease Term ► Provide primary lease term of 10 to 25 years ► No near-term vacancy

Diversification ► Diversify by geography, industry and tenancy ► No over concentration

How We Generate Income

►Acquire single-tenant, free-standing properties► Structure triple-net leases► Construct contractual rent growth►Arrange fixed-rate, long-term financing

► No landlord expenses► No short-term maturities; no

floating-rate exposure► No multi-tenant risk

Our Strategy Towards Asset Appreciation

►Acquire properties with/in: Contractual rent growth Strong retail markets Prime locations

► No overvalued legacy assets► No erosion of asset values► No limitation on reuse

There can be no assurance that we will achieve any of our stated goals or objectives including avoiding potential road blocks. The credit quality of a tenant may change over the term of the lease.


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Defined Exit Strategy

ARCT IV Exit

Strategy

2017-2020

Anticipated Exit: 3 to 6 years following offering close

Contractual Rent Growth

NOTE: If we do not begin the process of achieving a Liquidity Event by the sixth anniversary of the termination of this offering, our charter requires, unless extended by a majority of the board of directors and a majority of the independent directors, that we hold a stockholders meeting to vote on a proposal for our orderly liquidation of our portfolio. If the adoption of a plan of liquidation is postponed, our board of directors will reconsider whether liquidation is in the best interests of our stockholders at least annually. If the board does not decide to pursue a liquidity event, or the stockholders do not approve a liquidity event, we could continue to operate indefinitely.


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Defined Exit Strategy

Exit 1 List on Public Exchange

Sale of Individual Assets

Sale of Portfolio to Strategic BuyersExit 2

Exit 3

NOTE: If we do not begin the process of achieving a Liquidity Event by the sixth anniversary of the termination of this offering, our charter requires, unless extended by a majority of the board of directors and a majority of the independent directors, that we hold a stockholders meeting to vote on a proposal for our orderly liquidation of our portfolio. If the adoption of a plan of liquidation is postponed, our board of directors will reconsider whether liquidation is in the best interests of our stockholders at least annually. If the board does not decide to pursue a liquidity event, or the stockholders do not approve a liquidity event, we could continue to operate indefinitely. A liquidity event is not guaranteed and may be postponed.


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Investment Summary

Offering Size: $1.5 billion The aggregate offering amount and price per share are not fixed and will fluctuate after we begin to calculate NAV.

Share Price: $25.00 per share, then at NAV (calculated quarterly, plus applicable selling costs) beginning the first calendar quarter following the acquisition of $1.2 billion in assets.1

Minimum Investment: $2,500Minimum investments may differ in certain states. See Prospectus for details.

Distribution Reinvestment Plan: Greater of $23.75, or 95% of NAV2

1. Our independent valuer, Duff & Phelps, LLC, will appraise our properties at least annually and appraisals will be scheduled over the course of a year so that approximately 25% of all of our properties are appraised each quarter. The independent valuer will then use those appraisals to make an estimate of our property portfolio along with other material information and other data. Our advisor then will calculate our NAV per share quarterly by calculating the net value of our operating partnership’s real estate and real estate-related assets, which will include the consideration of appraisals and estimates provided by our independent valuer, minus liabilities, including accrued fees and accrued distributions, divided by our shares outstanding. Our advisor is responsible for the ultimate calculation of the quarterly NAV, subject to board approval. The board will oversee the advisor’s NAV calculation and review the process used by our advisor to estimate accrued liabilities and calculate NAV on a quarterly basis. Our independent valuer will use methodologies based on judgments, assumptions and opinions about future events that may or may not prove to be correct, and if different judgments, assumptions or opinions were used, a different estimate would likely result. Furthermore, our published NAV per share may not fully reflect certain extraordinary events, including, without limitation, the unexpected renewal or termination of a material lease, or unanticipated structural or environmental events affecting the value of a property, because we may not be able to quantify the financial impact of such events on our portfolio right away.

2. Until we calculate NAV, shares sold pursuant to our distribution reinvestment plan (“DRIP”) will be sold at the greater of $23.75 or 95% of the estimated value per share. After we calculate NAV, shares will be sold pursuant to the DRIP at NAV.


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Investment Summary (continued)

Investor Suitability:$70,000 gross income and $70,000 net worth; or $250,000 net worthSuitability requirements may differ in certain states, including: AL, CA, IA, KS, KY, MA, ME, MI, MO, MS, ND, NE, NJ, NM, OH, OR, PA, TN and WA — For more information, please consult the current prospectus.

Share Repurchase Plan:*

* Our board of directors may choose to terminate, suspend or modify our share repurchase program with 30 days notice. More detailed information on the terms, conditions and limitations can be found in the prospectus.

Prior to our calculation of NAV, repurchases for continuously held shares will proceed as follows:1 One Year – The lower of $23.13 or 92.5% of purchase price; Two Years – The lower of $23.75 or 95.0% of purchase price; Three Years – The lower of $24.38 or 97.5% of purchase price; and Four Years – The lower of $25.00 or 100% of purchase price.

After the first quarter following the acquisition of at least $1.2 billion in total portfolio assets, repurchases will be priced at that day’s NAV price per share, minus applicable fees.2

___________________________________

1 Prior to our calculation of NAV, no share repurchases will be made in excess of (for any given year) 5% of the weighted average number of shares of common stock outstanding as of December 31st of the prior year. 2 After NAV is calculated, share redemptions will be limited during any calendar quarter to 1.25% of our NAV as of the last day of the previous calendar quarter, or approximately 5% of our NAV in any 12 month period.


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A Different Path

Management Experienceand Track Record

Lease Structure

Tenant Credit Quality

The ARCT IV Difference

ARCT IVAmerican Realty Capital Trust IV, Inc. will take a different path.

Our goal is to manage, mitigate or eliminate the variables thatcould potentially affect distributions in order to provide returnsto our investors that have the potential to grow over time.

We intend to purchase properties with a minimum remainingprimary lease term of ten years and target an overall portfolioleverage level of 45 percent.1

1 Our charter permits up to 75% leverage. If we have insufficient cash flows to service our debts or if any of our properties are foreclosed upon, our ability to pay distributions to our stockholders will be adversely affected which could result in our losing our REIT status and would decrease the value of your investment.

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Notes


For more information on American Realty Capital Trust IV, please call your financial professional.

Broker Dealer InquiriesRealty Capital Securities, LLCThree Copley Place, Suite 3300, Boston, MA 02116 | 877-373-2522 | www.rcsecurities.com

Realty Capital Securities, LLC (Member FINRA/SIPC), is the dealer manager for American Realty Capital Trust IV, Inc., an affiliate.

WEBSITE: http://www.arct-4.com

ARCT ARC Daily NAV ARCT III ARCT IVarct-4.com/ARCT-IV_InvestorPresentation.pdf · AmericanFinancial...

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