Realty Income Corporation (NYSE: O) announced a proposed private offering of $750.0 million in aggregate principal amount of convertible senior notes due 2031, according to a press release. The offering targets persons reasonably believed to be qualified institutional buyers under Rule 144A of the Securities Act of 1933.

The company also expects to grant initial purchasers an option to buy up to an additional $112.5 million in aggregate principal amount of notes, exercisable within 13 days of the initial issuance date.

The notes will be senior, unsecured obligations with interest payable semi-annually. The interest rate, initial conversion rate, and other terms are to be determined at pricing. Realty Income may not redeem the notes before Aug. 20, 2029, except in the case of a cleanup redemption or a REIT preservation redemption. On or after that date, the company may redeem the notes if its common stock price exceeds 130% of the conversion price for a specified period.

Realty Income plans to use a portion of the net proceeds to fund capped call transactions intended to reduce potential dilution to common stockholders upon conversion. The company also intends to use a portion of proceeds to repurchase shares of its common stock concurrently with the pricing of the offering through privately negotiated transactions.

Remaining proceeds are earmarked for general corporate purposes, which may include repayment of debt, property acquisitions, hedging instruments, and portfolio improvements.

The notes and any shares issuable upon conversion have not been registered under the Securities Act and may not be offered or sold absent an applicable exemption.