September 30, 2013 Restated Consolidated Balance Sheet


	September 30, 2013
	As Previously Reported ⁽¹⁾			ARCT IV Recast ⁽²⁾			Reclassifications			Restatement Adjustments			As Restated
ASSETS
Real estate investments, at cost:
Land	$	521,139		$	494,330		$	—		$	(1,581	)	$	1,013,888
Buildings, fixtures and improvements		2,121,178			1,429,122			—			(1,028	)		3,549,272
Acquired intangible lease assets		328,733			221,663			347			(85	)		550,658

Total real estate investments, at cost		2,971,050			2,145,115			347			(2,694	)		5,113,818
Less: accumulated depreciation and amortization		(148,162	)		(30,941	)		(143	)		230			(179,016	)

Total real estate investments, net		2,822,888			2,114,174			204			(2,464	)		4,934,802
Cash and cash equivalents		150,481			37,745			—			—			188,226
Investment in direct financing leases, net		57,449			17,954			—			—			75,403
Investment securities, at fair value		9,480			—			—			—			9,480
Derivative assets, at fair value		7,088			28			(7,116	)		—			—
Restricted cash		1,680			—			—			—			1,680
Prepaid expenses and other assets		48,165			15,111			(63,276	)		—			—
Receivable for Issuances of common stock		—			14,311			(14,311	)		—			—
Deferred costs, net		47,754			—			(47,754	)		—			—
Assets held for sale		6,028			—			—			(14	)		6,014
Deferred costs and other assets, net		—			—			132,253			598			132,851

Total assets	$	3,151,013		$	2,199,323		$	—		$	(1,880	)	$	5,348,456


LIABILITIES AND EQUITY
Mortgage notes payable		269,891			2,124			—			—			272,015
Convertible debt		300,975			—			—			—			300,975
Senior corporate credit facility		600,000			710,000			—			—			1,310,000
Convertible obligation to Series C Convertible Preferred stockholders, at fair value		449,827			—			—			—			449,827
Contingent value rights obligation to preferred and common investors, at fair value		49,314			—			—			—			49,314
Below-market lease liabilities, net		4,200			—			—			(620	)		3,580
Derivative liabilities, at fair value		—			—			—			—			—
Accounts payable and accrued expenses		14,740			662,432			(897	)		(5,303	)		670,972
Deferred rent and other liabilities		9,189			2,901			897			—			12,987
Distributions payable		72			9,810			—			436			10,318
Due to affiliates		—			—			—			6,107			6,107

Total liabilities		1,698,208			1,387,267			—			620			3,086,095


Convertible preferred stock, $0.01 par value, 100,000,000 shares authorized, 42,215,346 shares issued and outstanding at September 30, 2013		—			422			—			—			422
Common stock, $0.01 par value, 750,000,000 shares authorized and 222,351,780 issued and outstanding at September 30, 2013		1,848			375			—			—			2,223
Additional paid-in capital		1,803,315			904,640			—			3,035			2,710,990
Accumulated other comprehensive income		4,857			28			—			—			4,885
Accumulated deficit		(480,817	)		(121,392	)		—			2,416			(599,793	)

Total stockholders’ equity		1,329,203			784,073			—			5,451			2,118,727
Non-controlling interests		123,602			27,983			—			(7,951	)		143,634

Total equity		1,452,805			812,056			—			(2,500	)		2,262,361

Total liabilities and equity	$	3,151,013		$	2,199,323		$	—		$	(1,880	)	$	5,348,456

(1)	Certain line items have been consolidated from the original presentation in the Quarterly Report on Form 10-Q filing for the three and nine month period ended September 30, 2013.

(2)	These financial statements have been recast in applying the carryover basis of accounting to include ARCT IV.

Restated Statement of Operations (for the three months ended September 30, 2013)


	Three Months Ended
	September 30, 2013
	As Previously Reported ⁽¹⁾			ARCT IV Recast ⁽²⁾			Reclassifications			Restatement Adjustments			As Restated
Revenues:
Rental income	$	56,681		$	33,054		$	(6	)	$	—		$	89,729
Direct financing lease income		977			224			—			—			1,201
Operating expense reimbursements		3,226			1,093			6			—			4,325

Total revenues		60,884			34,371			—			—			95,255

Operating expenses:
Acquisition related		1,235			25,713			—			—			26,948
Merger and other non-routine transactions		3,791			2,122			—			(1,612	)		4,301
Property operating		4,103			1,341			—			(14	)		5,430
Management fees to affiliate		—			—			—			—			—
General and administrative		1,586			822			—			7,458			9,866
Equity-based compensation		7,180			—			—			(7,180	)		—
Depreciation and amortization		39,382			23,030			—			(276	)		62,136
Operating fees to affiliate		—			—			—			—			—
Impairment of real estate		—			—			—			2,074			2,074

Total operating expenses		57,277			53,028			—			450			110,755

Operating income		3,607			(18,657	)		—			(450	)		(15,500	)

Other (expense) income:
Interest expense		(24,135	)		(3,054	)		—			—			(27,189	)
Loss on contingent value rights		(38,542	)		—			38,542						—
Income from investment securities		—			—			—			—			—
Gain (loss) on sale of investment securities		—			(2,246	)		—			—			(2,246	)
Loss on derivative instruments		(99	)		—			(38,542	)					(38,651	)
Other income, net		45			44			—			47			136

Total other expenses, net		(62,731	)		(5,256	)		—			37			(67,950	)

Loss from continuing operations		(59,124	)		(23,913	)		—			(413	)		(83,450	)
Net (gain) loss from continuing operations attributable to non-controlling interests		(30	)		260			—			2,923			3,153

Net loss from continuing operations attributable to stockholders		(59,154	)		(23,653	)		—			2,514			(80,293	)

Discontinued operations:
Net income (loss) from operations of held for sale properties		96			—			—			—			96
(Loss) gain on held for sale properties		—			—			—			—			—

Net income (loss) from discontinued operations		96			—						—			96
Net (loss) income from discontinued operations attributable to non-controlling interests		(5	)		—			—			5			—

Net income (loss) from discontinued operations attributable to stockholders		91			—			—			5			96

Net loss		(59,028	)		(23,913	)		—			(413	)		(83,354	)
Net (income) loss attributable to non-controlling interests		(35	)		260			—			2,928			3,153

Net loss attributable to stockholders	$	(59,063	)	$	(23,653	)	$	—		$	2,515		$	(80,201	)


Basic and diluted net loss per share from continuing operations attributable to common stockholders	$	(0.32	)	$	—		$	—		$	—		$	(0.36	)

Basic and diluted net loss per share attributable to common stockholders	$	(0.32	)	$	—		$	—		$	—		$	(0.36	)

Restated Statement of Operations (for the nine months ended September 30, 2013)


	Nine Months Ended
	September 30, 2013
	As Previously Reported ⁽¹⁾			ARCT IV Recast ⁽²⁾			Reclassifications			Restatement Adjustments			As Restated
Revenues:
Rental income	$	138,060		$	45,102		$	89		$	—		$	183,251
Direct financing lease income		977			224			—			—			1,201
Operating expense reimbursements		6,878			1,727			(89	)		—			8,516

Total revenues		145,915			47,053			—			—			192,968

Operating expenses:
Acquisition related		21,961			52,603			—			(23	)		74,541
Merger and other non-routine transactions		146,240			3,835			—			(16,341	)		133,734
Property operating		8,972			2,107			—			(14	)		11,065
Management fees to affiliate		—			—			—			12,493			12,493
General and administrative		4,018			2,214			34			17,655			23,921
Equity-based compensation		11,510			—			—			(11,510	)		—
Depreciation and amortization		92,211			30,620			(34	)		(313	)		122,484
Operating fees to affiliate		—			—			—			—			—
Impairment of real estate		—			—			—			2,074			2,074

Total operating expenses		284,912			91,379			—			4,021			380,312

Operating income		(138,997	)		(44,326	)		—			(4,021	)		(187,344	)

Other (expense) income:
Interest expense		(41,589	)		(3,240	)		—			(585	)		(45,414	)
Loss on contingent value rights		(69,676	)		—			69,676			—			—
Income from investment securities		218			1,798			(2,016	)		—			—
Gain (loss) on sale of investment securities		451			(2,246	)		—			—			(1,795	)
Loss on derivative instruments		(144	)		—			(69,676	)		(10	)		(69,830	)
Other income, net		171			463			2,016			8			2,658

Total other expenses, net		(110,569	)		(3,225	)		—			(587	)		(114,381	)

Loss from continuing operations		(249,566	)		(47,551	)		—			(4,608	)		(301,725	)
Net (gain) loss from continuing operations attributable to non-controlling interests		726			415			—			6,741			7,882

Net loss from continuing operations attributable to stockholders		(248,840	)		(47,136	)		—			2,133			(293,843	)

Discontinued operations:
Net income (loss) from operations of held for sale properties		159			—			—			—			159
(Loss) gain on held for sale properties		14			—			—			(14	)		—

Net income (loss) from discontinued operations		173			—			—			(14	)		159
Net (loss) income from discontinued operations attributable to non-controlling interests		(9	)		—			—			9			—

Net income (loss) from discontinued operations attributable to stockholders		164			—			—			(5	)		159

Net loss		(249,393	)		(47,551	)		—			(4,622	)		(301,566	)
Net (income) loss attributable to non-controlling interests		717			415			—			6,750			7,882

Net loss attributable to stockholders	$	(248,676	)	$	(47,136	)	$	—		$	2,128		$	(293,684	)


Basic and diluted net loss per share from continuing operations attributable to common stockholders	$	(1.49	)	$	—		$	—		$	—		$	(1.50	)
Basic and diluted net loss per share attributable to common stockholders	$	(1.49	)	$	—		$	—		$	—		$	(1.50	)

(1)	Certain line items have been consolidated from the original presentation in the Quarterly Report on Form 10-Q filing for the three and nine month period ended September 30, 2013.

(2)	These financial statements have been recast in applying the carryover basis of accounting to include ARCT IV.

2013 Restated Statement of Comprehensive Loss (for the three months ended September 30, 2013) ⁽¹⁾


	Three Months Ended September 30, 2013
	As Previously Reported ⁽²⁾			ARCT IV Recast ⁽³⁾			Restatement Adjustments			As Restated
Net loss	$	(59,028	)	$	(23,913	)	$	(413	)	$	(83,354	)

Other comprehensive loss:
Designated derivatives, fair value adjustments		(3,622	)		(13	)		—			(3,635	)

Change in unrealized gain/loss on investment securities		(440	)		—			1,378			938

Total other comprehensive loss		(4,062	)		(13	)		1,378			(2,697	)

Total comprehensive loss		(63,090	)		(23,926	)		965			(86,051	)
Net (income) loss attributable to non-controlling interests		(30	)		260			2,923			3,153

Total comprehensive loss attributable to the Company	$	(63,120	)	$	(23,666	)	$	3,888		$	(82,898	)

2013 Restated Statement of Comprehensive Loss (for the nine months ended September 30, 2013) ⁽¹⁾


	Nine Months Ended September 30, 2013
	As Previously Reported ⁽²⁾			ARCT IV Recast ⁽³⁾			Restatement Adjustments			As Restated
Net loss	$	(249,393	)	$	(47,551	)	$	(4,622	)	$	(301,566	)

Other comprehensive income:
Designated derivatives, fair value adjustments		9,218			28			—			9,246
Change in unrealized gain/loss on investment securities		(427	)		—			—			(427	)

Total other comprehensive income		8,791			28			—			8,819

Total comprehensive loss		(240,602	)		(47,523	)		(4,622	)		(292,747	)
Net loss attributable to non-controlling interests		717			415			6,750			7,882

Total comprehensive loss attributable to the Company	$	(239,885	)	$	(47,108	)	$	2,128		$	(284,865	)

(1)	The statement of comprehensive loss was originally included within the consolidated statement of operations in the recasted filing; it is now presented as a standalone financial statement.

(2)	Certain line items have been consolidated from the original presentation in the Quarterly Report on Form 10-Q filing for the three and nine month period ended September 30, 2013.

(3)	These financial statements have been recast in applying the carryover basis of accounting to include ARCT IV.

Restated Statement of Cash Flows for the Nine Months Ended September 30, 2013


	Nine Months Ended September 30, 2013
	As Previously Reported ⁽¹⁾			ARCT IV Recast⁽²⁾			Restatement Adjustments			As Restated
Cash flows from operating activities:
Net loss	$	(249,393	)		(47,551	)	$	(4,622	)	$	(301,566	)
Adjustments to reconcile net loss to net cash provided by operating activities:
Issuance of operating partnership units for ARCT III Merger and other transaction related expenses		108,247			—			(476	)		107,771
Depreciation		99,832			31,501			272			131,605
(Gain) loss on held for sale properties		(14	)		—			14			—
Impairment of real estate		—			—			2,074			2,074
Equity-based compensation		13,895			18			68			13,981
Loss on derivative instruments		144			—			—			144
Unrealized loss on investments		14			—			—			14
Unrealized loss on contingent value rights obligations, net of settlement payments		49,314			—			—			49,314
Convertible obligations to Series C Convertible Preferred stockholders, fair value adjustment		4,827			—			—			4,827
(Gain) loss on sale of investments		(451	)		2,246			—			1,795
Changes in assets and liabilities:
Investment in direct financing leases		102			46			—			148
Prepaid expenses and other assets		(12,081	)		(8,432	)		—			(20,513	)
Accounts payable and accrued expenses		4,464			11,251			(5,280	)		10,435

Deferred rent and other liabilities		3,068			2,843			—			5,911
Due from Affiliates		—			(4,105	)		—			(4,105	)
Due to Affiliates		—			—			6,107			6,107

Net cash provided by (used in) operating activities		21,968			(12,183	)		(1,843	)		7,942

Cash flows from investing activities:
Investments in real estate and other assets		(1,173,497	)		(2,068,337	)		—			(3,241,834	)
Investment in direct financing leases		(57,551	)		(18,000	)		—			(75,551	)
Capital expenditures		(113	)		—			—			(113	)
Purchase of assets from Manager		(1,041	)		—			1,041			—
Deposits for real estate investments		(28,836	)		(2,279	)		—			(31,115	)
Purchases of investment securities		(12,004	)		(69,460	)		—			(81,464	)
Proceeds from sale of investment securities		44,188			67,214			—			111,402

Net cash used in investing activities		(1,228,854	)		(2,090,862	)		1,041			(3,318,675	)

Cash flows from financing activities:
Proceeds from mortgage notes payable		4,773			2,124			—			6,897
Proceeds from senior corporate credit facility		860,000			710,000			—			1,570,000
Payments on senior corporate credit facility		(384,604	)		—			—			(384,604	)
Proceeds from corporate bonds		(38,221	)		(15,176	)		—			(53,397	)
Proceeds from issuance of convertible debt		310,000			—			—			310,000

Common stock repurchases		(357,916	)		(177	)		—			(358,093	)
Proceeds from issuance of convertible obligations to Series C Convertible Preferred stockholders		445,000			—			—			445,000
Proceeds from issuance of common stock, net		486,536			1,320,729			(68	)		1,807,197

The consolidated statement of cash flows continues onto the next page.


	Nine Months Ended September 30, 2013
	As Previously Reported ⁽¹⁾			ARCT IV Recast ⁽²⁾			Restatement Adjustments			As Restated
Payments of deferred financing costs	$	—		$	—		$	(2,165	)	$	(2,165	)
Consideration paid for assets of Manager in excess of carryover basis		(3,035	)		—			3,035			—
Contributions from non-controlling interest holders		750			29,008			—			29,758
Distributions to non-controlling interest holders		(5,170	)		(445	)		—			(5,615	)
Distributions paid		(117,047	)		(40,599	)		—			(157,646	)
Advances from affiliates, net		—			(376	)		—			(376	)
Restricted cash		(572	)		—			—			(572	)

Net cash provided by financing activities		1,200,494			2,005,088			802			3,206,384

Net change in cash and cash equivalents		(6,392	)		(97,957	)		—			(104,350	)
Cash and cash equivalents, beginning of period		156,873			135,702			—			292,575

Cash and cash equivalents, end of period	$	150,481		$	37,745		$	—		$	188,226

(1)	Certain line items have been consolidated from the original presentation in the Quarterly Report on Form 10-Q filing for the nine month period ended September 30, 2013.

(2)	These financial statements have been recast in applying the carryover basis of accounting to include ARCT IV.