Filed
pursuant to 424(b)(3)
Registration
No. 333-140354
[Date]
Re:
Capital Lease Funding, Inc. Dividend Reinvestment and Stock Purchase
Plan
Dear
Stockholder:
Capital
Lease Funding, Inc. (CapLease) is pleased to announce the adoption of a dividend
reinvestment and direct stock purchase plan. The plan allows interested
stockholders to reinvest all or a portion of their cash dividends in shares
of
CapLease common stock and to make monthly purchases of CapLease common stock
generally up to a maximum of $10,000 (unless a higher amount is approved by
CapLease in its sole discretion).
By
participating in the plan, you will be able to purchase shares of CapLease
common stock without paying brokerage commissions or service fees and you may
be
entitled to purchase shares at a discount from the prevailing market
price.
You
should read the enclosed plan document in its entirety before deciding to invest
in our common stock through the plan. You will also need to complete the
enclosed enrollment application to participate in the plan. Our plan will be
administered by our transfer agent, American Stock Transfer & Trust Company,
and if you have any questions about the plan, you can reach them toll free
at
(866) 706-0513.
We
are
excited to offer you this opportunity to participate in this new
plan.
Sincerely,
Enclosures
PROSPECTUS
CAPITAL
LEASE FUNDING, INC.
DIVIDEND
REINVESTMENT AND STOCK PURCHASE PLAN
5,000,000
Shares of Common Stock
The
dividend reinvestment and stock purchase plan of Capital Lease Funding, Inc.
provides an economical and convenient way for current stockholders and other
interested new investors to invest in our common stock. Through participation
in
the plan, you will have the opportunity to:
| · |
Reinvest
cash dividends paid on your shares of common stock in additional
shares of
common stock.
|
| · |
Make
optional cash payments of $100 to $10,000 per month to purchase common
stock.
|
| · |
Make
automatic monthly investments of $100 to $10,000 by authorizing automatic
deductions from your banking or checking accounts to purchase shares
of
common stock.
|
| · |
In
some instances, subject to our approval, make optional cash payments
in
excess of $10,000 to purchase common stock, at a discount of 0% to
5% as
we determine in our sole
discretion.
|
At
the
time of this prospectus, we are offering a discount of 2% on the purchase of
shares of common stock directly from us through the plan, other than in
connection with cash investments in excess of $10,000 or initial investments
to
begin participation in the plan. The discount is from the average of the daily
high and low sales prices on the New York Stock Exchange on the five trading
days immediately preceding the applicable investment date, but may not exceed
5%
of the average of the high and low sales prices on the applicable investment
date. We reserve the right to reduce or discontinue this discount at any
time.
Our
shares of common stock are quoted on the New York Stock Exchange under the
symbol “LSE.” On January 30, 2007, the closing sales price of our common
stock as reported on the New York Stock Exchange was $11.20 per
share.
Investing
in our common stock involves risks. You should read carefully the risk factors
described in our Securities and Exchange Commission filings, including our
annual report on Form 10-K, before investing in our common
stock.
NEITHER
THE SECURITIES AND EXCHANGE
COMMISSION NOR ANY STATE SECURITIES
COMMISSION
HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR
DETERMINED
IF THIS PROSPECTUS IS TRUTHFUL OR COMPLETE. ANY
REPRESENTATION
TO THE CONTRARY IS A CRIMINAL OFFENSE.
The
date
of this prospectus is February 8, 2007.
Table
of Contents
|
Page
|
|
|
About
this Prospectus
|
i
|
|
Summary
of the Plan
|
1
|
|
Cautionary
Statement Regarding Forward-Looking Statements
|
4
|
|
About
Capital Lease Funding, Inc.
|
5
|
|
Use
of Proceeds
|
5
|
|
Terms
and Conditions of the Plan
|
5
|
|
Purpose
|
5
|
|
Options
Available to Participants
|
6
|
|
Advantages
and Disadvantages
|
6
|
|
Administration
and Plan Administrator
|
7
|
|
Participation
|
8
|
|
Purchases
and Prices of Shares
|
12
|
|
Reports
to Participants
|
16
|
|
Dividends
on Fractions of Shares
|
17
|
|
Certificates
for Shares
|
17
|
|
Sale
of Shares
|
17
|
|
Withdrawals
and Termination
|
18
|
|
Other
Information
|
18
|
|
Plan
of Distribution
|
22
|
|
Legal
Matters
|
22
|
|
Experts
|
22
|
|
Where
You Can Find More Information
|
23
|
ABOUT
THIS
PROSPECTUS
This
prospectus is part of a registration statement on Form S-3 that we filed with
the Securities and Exchange Commission. This prospectus does not contain all
of
the information set forth in the registration statement, portions of which
we
have omitted as permitted by the rules and regulations of the Commission.
Statements contained in this prospectus as to the contents of any contract
or
other document are not necessarily complete. If the Commission’s rules and
regulations require that a contract or document be filed as an exhibit to the
registration statement, we refer you to the copy of the contract or document
filed as an exhibit to the registration statement for a complete description.
You should rely only on the information in our prospectus and the documents
that
are incorporated by reference. We have not authorized anyone else to provide
you
with different information. We are not offering these securities in any state
where the offer is prohibited by law. You should not assume that the information
in our prospectus or any incorporated document is accurate as of any date other
than the date of the document.
References
to “we,” “us” or “our” refer to Capital Lease Funding, Inc. and its direct or
indirect majority-owned subsidiaries, unless the context otherwise
requires.
i
SUMMARY
OF
THE PLAN
The
following summary of our dividend reinvestment and stock purchase plan may
omit
information that may be important to you. You should carefully read the entire
text of the plan contained in this prospectus before you decide to participate
in the plan.
|
Participation:
|
Participation
in the plan allows you to purchase our common stock, in some cases,
at a
discount from the market price of the stock.
|
|
Enrollment
if You Own Shares of Stock:
|
You
can participate in the plan if you currently own our common stock
by
submitting a completed authorization form to the plan’s administrator,
American Stock Transfer & Trust Company. You may obtain an
authorization form from the plan administrator or by completing the
enrollment procedures specified on the website of the plan administrator
at www.amstock.com.
You may participate directly in the plan only if you hold common
stock in
your own name. If you hold shares through a brokerage or other custodial
account, you may arrange to have your broker or other custodian
participate on your behalf.
|
|
Initial
Investment if You Do Not Own Shares of Stock:
|
If
you do not own any common stock, you can participate in the plan
by making
an initial investment in shares of common stock through the plan,
with a
minimum initial investment of $100 and without paying fees. There
is no
discount on the initial investment.
|
|
Reinvestment
of Dividends:
|
You
can reinvest your cash dividends on some or all of your common stock.
You
will be able to purchase additional shares of common stock by reinvesting
your dividends without paying fees and, currently, receive a discount
equal to 2% for the common stock purchased directly from us with
reinvested dividends. (See “Purchase Price” below.) Stock purchased under
the plan will be purchased on the “investment date” in each month. The
investment date for stock purchased pursuant to dividend reinvestments
generally will be the quarterly dividend payment date declared by
our
Board of Directors. To commence dividend reinvestments for any particular
quarterly dividend, the plan administrator must receive a completed
authorization form by the record date for such quarterly dividend.
We may
eliminate this discount or offer a discount of up to 5% of the average
of
the high and low sales prices of the common stock on the applicable
investment date.
|
|
Optional
Cash Payments:
|
After
you enroll in the plan, you can buy common stock without paying fees
and,
currently, at a 2% discount on shares purchased directly from us.
You can
invest a minimum of $100 to a maximum of $10,000 in any one month.
The
investment date for stock acquired pursuant to optional cash payments
will
generally be the 15th of each month or, if such date is not a business
day, the first business day thereafter. The deadline for submitting
optional cash payments is two (2) business days before the relevant
investment date. Payment may be by check or money order. We may eliminate
this discount or offer a discount of up to 5% of the average of the
high
and low sales prices of the common stock on the applicable investment
date.
|
|
Waivers
of Maximum Monthly Limit on Optional Cash
Payments:
|
Under
some circumstances, we may approve a written request to waive the
$10,000
per month limit on optional cash payments. These requests must be
submitted to us by facsimile at least three (3) business days prior
to the
first day of the applicable five-day pricing period (i.e., eight
(8)
business days before the relevant investment date). If we grant the
waiver, you must submit our written waiver along with payment no
later
than the close of business on the last business day immediately preceding
the first day of the pricing period.
|
|
Source
of Shares:
|
The
administrator of the plan will purchase common stock in one of the
following ways: (i) directly from us as newly issued common stock, or
(ii) from parties other than us, either in the open market or in
privately negotiated transactions. We are not required to provide
any
written notice to you as to the source of the common stock to be
purchased
under the plan.
|
1
|
Purchase
Price:
|
The
purchase price of common stock under the plan depends on whether
we issue
new shares of common stock to you or the plan administrator obtains
your
shares of common stock by purchasing them in the open market, and
whether
any discount is being offered by us at the time of the applicable
common
stock purchase.
|
|
Reinvested
Dividends and Optional Cash Payments of $10,000 or
Less:
|
Purchased
from Us:
With respect to reinvested dividends and optional cash payments of
$10,000
or less, we are currently offering a 2% discount off of the market
price
as determined below, but that discount may not exceed 5% of the average
of
the high and low sales prices on the applicable investment date.
As such,
currently, the purchase price for common stock that the plan administrator
purchases directly from us generally will be 98% of the market price
of
the common stock. For purposes of the plan, the market price of the
common
stock equals the average of the daily high and low sales prices of
our
common stock on the New York Stock Exchange on the five (5) trading
days
immediately preceding the relevant investment date (the “Market Price”).
The discount from the Market
Price
for common stock that the plan administrator purchases directly from
us
may be changed or eliminated by us from time to time, provided that
in no
event will the discount exceed 5% of the average of the high and
low sales
prices on the applicable investment date. If you are a participant
in the
plan, you will be provided with at least thirty (30) days’ prior written
notice of any change in this discount.
Purchased
from Parties Other than Us:
The purchase price for common stock that the plan administrator purchases
from parties other than us, either in the open market or in privately
negotiated transactions, will be 100% of the average price per share
actually paid by the plan administrator, excluding any brokerage
commissions. We currently do not offer a discount on common stock
purchased from parties other than us.
|
|
Optional
Cash Payments Greater than $10,000:
|
Purchased
from Us:
The purchase price for common stock that the plan administrator purchases
directly from us will be the Market
Price
of the common stock, less any discount that we may elect to offer
in
connection with a waiver of the $10,000 per month limit, provided
that in
no event will the discount exceed 5% of the average of the high and
low
sales prices on the applicable investment date. The Market
Price
for optional cash payments in excess of $10,000 is determined in
the same
manner as for optional cash payments of less than $10,000, except
that we
may set a minimum amount as the lowest Market Price in connection
with any
purchase with optional cash payments exceeding $10,000 in any month.
We
will set the minimum price and the applicable discount, if any, at
least
four (4) business days before the first day of the applicable pricing
period. Written notice of the minimum price and the applicable discount
at
any time will not be provided to you. You must call our Investor
Relations
department at 212-217-6393 to obtain the minimum price and applicable
discount, if any.
Purchased
from Parties Other than Us:
The purchase price for common stock that the plan administrator purchases
from parties other than us, either in the open market or in privately
negotiated transactions, will be 100% of the average price per share
actually paid by the plan administrator, excluding any brokerage
commissions.
|
|
Tracking
Your Investment:
|
You
will receive periodic statements of the transactions made in your
plan
account. These statements will provide you with details of the
transactions and will indicate the share balance in your plan
account.
|
2
|
Administration
and Plan Administrator:
|
American
Stock Transfer & Trust Company, which became our transfer agent in
February 2006, initially will serve as the plan administrator of
the plan.
You should send all transaction requests to the administrator
at:
American
Stock Transfer & Trust Company
Wall
Street Station
P.O.
Box 922
New
York, New York 10269-0560
You
should send all correspondence to the administrator at:
American
Stock Transfer & Trust Company
59
Maiden Lane
New
York, New York 10038
Please
mention Capital Lease Funding, Inc. and this plan in all correspondence.
In addition, you may call the plan administrator at 866-706-0513
or
contact the plan administrator via the Internet at www.amstock.com.
You
may also request that any or all shares held in the plan be sold
by the
plan administrator on your behalf for a nominal fee. This fee, any
brokerage costs and any applicable stock transfer taxes on the sale
of
such shares all will be deducted by the plan administrator, and the
balance will be sent to you.
|
3
CAUTIONARY
STATEMENT REGARDING FORWARD-LOOKING STATEMENTS
We
may
from time to time make written or oral forward-looking statements within the
meaning of Section 27A of the Securities Act of 1933, as amended, and Section
21E of the Securities Exchange Act of 1934, as amended, including statements
contained in our filings with the Securities and Exchange Commission and in
our
press releases and webcasts. Forward-looking statements relate to expectations,
beliefs, projections, future plans and strategies, anticipated events or trends
and similar expressions concerning matters that are not historical facts. In
some cases, you can identify forward-looking statements by terms such as
“anticipate,” “believe,” “could,” “estimate,” “expect,” “intend,” “may,” “plan,”
“potential,” “should,” “strategy,” “will” and other words of similar meaning.
The forward-looking statements are based on our beliefs, assumptions and
expectations of future performance, taking into account all information
currently available to us. These beliefs, assumptions and expectations can
change as a result of many possible events or factors, not all of which are
known to us or are within our control. If a change occurs, our business,
financial condition, liquidity and results of operations may vary materially
from those expressed in our forward-looking statements. In connection with
the
“safe harbor” provisions of the Private Securities Litigation Reform Act of
1995, we are hereby identifying important factors that could cause actual
results and outcomes to differ materially from those contained in any
forward-looking statement made by or on our behalf. Such factors include, but
are not limited to:
| · |
our
ability to close the investments we currently have under due diligence
on
acceptable terms;
|
| · |
our
ability to make additional investments in a timely manner or on acceptable
terms;
|
| · |
our
ability to obtain long-term financing for our asset investments at
the
spread levels we project when we invest in the
asset;
|
| · |
adverse
changes in the financial condition of the tenants underlying our
investments;
|
| · |
increases
in our financing costs, our general and administrative costs and/or
our
property expenses;
|
| · |
changes
in our industry, the industries of our tenants, interest rates or
the
general economy;
|
| · |
the
success of our hedging strategy;
|
| · |
our
ability to raise additional
capital;
|
| · |
impairments
in the value of the collateral underlying our investments;
and
|
| · |
the
degree and nature of our
competition.
|
In
addition, we may be required to defer revenue recognition on real properties
we
acquire if the property is under construction or is not yet ready for
occupancy.
These
risks and uncertainties should be considered in evaluating any forward-looking
statement we may make from time to time. Any forward-looking statement speaks
only as of its date. All subsequent written and oral forward-looking statements
attributable to us or any person acting on our behalf are qualified by the
cautionary statements in this section. We undertake no obligation to update
or
publicly release any revisions to forward-looking statements to reflect events,
circumstances or changes in expectations after the date made.
4
ABOUT
CAPITAL LEASE FUNDING, INC.
We
are a
diversified real estate investment trust, or REIT, that invests primarily
in
single tenant commercial real estate assets subject to long-term leases to
high
credit quality tenants. We focus on properties that are subject to a net
lease,
or a lease that requires the tenant to pay all or substantially all expenses
normally associated with the ownership of the property (such as utilities,
taxes, insurance and routine maintenance) during the lease term. We also
continue to be opportunistic and have made and expect to continue to make
investments in single tenant properties where the owner has exposure to property
expenses when we determine we can sufficiently underwrite that exposure and
isolate a predictable cash flow.
Our
primary business objective is to generate stable, long-term and attractive
returns based on the spread between the yields generated by our assets and
the
cost of financing our portfolio. We invest at all levels of the capital
structure of net lease or other single tenant properties, including equity
investments in real estate (owned real properties), debt investments (mortgage
loans and net lease mortgage backed securities) and mezzanine investments
secured by net leased or other single tenant real estate
collateral.
Our
address and phone number are Capital Lease Funding, Inc., 1065 Avenue of the
Americas, New York, New York 10018, (212) 217-6300.
USE
OF PROCEEDS
We
will
receive proceeds from the sale of common stock that the plan administrator
purchases directly from us. We will not receive proceeds from the sale of common
stock that the plan administrator purchases in the open market or in privately
negotiated transactions. We intend to use the net proceeds from our sale of
common stock that the plan administrator purchases directly from us for future
asset investments, repayment of debt and general corporate purposes. We cannot
estimate either the number of shares of common stock or the prices of the shares
that we will sell in connection with the plan.
TERMS
AND CONDITIONS OF THE PLAN
The
following questions and answers explain and constitute our Dividend Reinvestment
and Stock Purchase Plan, which we refer to as the “plan,” as in effect beginning
February 8, 2007. If you decide not to participate in the plan, you will
receive cash dividends, as declared and paid in the usual manner.
PURPOSE
|
1.
|
What
is the purpose of the
plan?
|
The
primary purpose of the plan is to provide current stockholders and interested
new investors with an economical and convenient way to increase their investment
in Capital Lease Funding. Current stockholders are permitted to invest cash
dividends in common stock without paying any brokerage commission or service
charge and, at certain times, at a discount from the Market
Price.
See
Question 15 with respect to the purchase price for shares purchased under the
plan. Current stockholders and new investors also may invest optional cash
payments in common stock without paying any brokerage commission or service
charge and, if permitted by us in our sole discretion, at a
discount.
We
may
also use the plan to raise additional capital through the sale each month of
a
portion of the shares available for issuance under the plan to purchasers of
shares (including brokers or dealers) who, in connection with any resales of
such shares, may be deemed to be underwriters. These sales will be made through
our ability to waive limitations on the maximum amount of any optional cash
payments.
The
plan
is primarily intended for the benefit of long-term investors, and not for the
benefit of individuals or institutions which engage in short-term trading
activities that could cause aberrations in the overall trading volume of our
common stock. From time to time, financial intermediaries may engage in
positioning transactions in order to benefit from the discount from the
Market
Price
for
common stock acquired through the reinvestment of dividends under the plan.
These transactions may cause fluctuations in the trading volume of our common
stock. We reserve the right to modify, suspend or terminate participation in
this plan by otherwise eligible holders of common stock in order to eliminate
practices which are not consistent with the purposes of the plan.
5
OPTIONS
AVAILABLE TO PARTICIPANTS
Information
on how to participate in the plan is set forth in Questions 5 through
13.
|
2.
|
What
are my investment options under the
plan?
|
Once
enrolled in the plan, you may purchase common stock through the following
investment options:
Dividend
Reinvestment Program.
Current
holders of common stock and interested new investors that are not currently
stockholders and who agree to make an initial investment in common stock, may
elect to have all, a portion or none of their cash dividends paid on their
common stock automatically reinvested in common stock through the dividend
reinvestment program. Cash dividends are paid on common stock when and as
declared by our Board of Directors, generally on a quarterly basis. Subject
to
the availability of common stock registered for issuance under the plan, there
is no limitation on the amount of dividends you may reinvest under the dividend
reinvestment program.
Stock
Purchase Program.
Each
month, current holders of common stock, and interested new investors that are
not currently stockholders and who agree to make an initial investment in common
stock, may elect to invest optional cash payments in common stock, subject
to a
minimum monthly optional cash purchase limit of $100 and a maximum monthly
optional cash purchase limit of $10,000. You may elect to make optional cash
payments through automatic deductions from your banking or checking accounts.
We
may, at our discretion, waive the maximum limit upon your written request.
See
Question 20 to learn how to request a waiver. You may make optional cash
payments each month even if dividends on your shares are not being reinvested
and even if a dividend has not been declared. You may, but are not required
to,
enroll any common stock purchased through the plan into the dividend
reinvestment program. (To designate these shares for participation in the
dividend reinvestment program, make the appropriate election on the
authorization form described in Question 12.)
|
3.
|
How
can I change my investment
options?
|
You
may
change your investment options at any time by requesting a new authorization
form and returning it to the plan administrator at the address set forth in
Question 7. Any authorization form which is returned to the plan administrator
to change your investment options will be effective in accordance with the
schedule described in Question 11.
ADVANTAGES
AND DISADVANTAGES
|
4.
|
What
are the advantages and disadvantages of the
plan?
|
Before
deciding whether to participate in the plan, you should consider the following
advantages and disadvantages of the plan.
Advantages.
| · |
The
plan provides you with the opportunity to reinvest cash dividends
paid on
all or a portion of your common stock toward the purchase of additional
common stock. Dividend reinvestments made directly through us are
eligible
for a discount of up to 5% from the average of the high and low sales
prices on the applicable investment date (currently the discount
is 2% of
the Market
Price).
|
| · |
The
plan provides you with the opportunity to make monthly investments
of
optional cash payments, subject to a minimum of $100 of optional
cash and
a maximum of $10,000 of optional cash (unless the maximum limit is
waived
by us), for the purchase of common stock. In addition, you have the
flexibility to make these optional cash investments on a regular
or
occasional basis at your option. Optional cash payments made directly
through us are eligible for a discount of up to 5% from the average
of the
high and low sales prices on the applicable investment date (currently
the
discount is 2% of the Market
Price).
|
| · |
There
are no costs associated with the plan that you must pay, except for
certain costs if you decide to sell common stock you purchased through
the
plan (see Question 26 for a description of these costs). You will
not pay
brokerage commissions or service fees to purchase common stock through
the
plan or to terminate your account.
|
6
| · |
As
noted above, you will have the convenience of having all or a portion
of
your cash dividends automatically reinvested in additional common
stock.
In addition, since the plan administrator will credit fractional
common
stock to your plan account, you will receive full investment of your
dividends. (See Questions 16 and
23.)
|
| · |
You
will have the option of having your stock certificates held for
safekeeping by the plan administrator for a one-time charge of $7.50,
insuring your protection against loss, theft or destruction of the
certificates representing your common
stock.
|
| · |
You
will simplify your record keeping by receiving periodic statements
which
will reflect all current activity in your plan account, including
purchases, sales and latest balances. (See Question
22.)
|
| · |
At
any time, you may direct the plan administrator to sell or transfer
all or
a portion of the common stock held in your plan account. Sales of
common
stock credited to your plan account may be sold as often as daily
but at
least within five (5) business days of receipt. (See Question
26.)
|
Disadvantages.
| · |
No
interest will be paid by us or the plan administrator on dividends
or
optional cash payments held pending reinvestment or investment. In
addition, optional cash payments of less than $100 and that portion
of any
optional cash payment which exceeds the maximum monthly purchase
limit of
$10,000 (unless this upper limit has been waived), are subject to
return
to you without interest. Moreover, purchases above the $10,000 limit
that
have been granted a waiver will also be subject to return to you
without
interest in the event that the minimum price, if any (see Question
20), is
not met.
|
| · |
You
may not know the actual number of shares of common stock that you
have
purchased until after the investment
date.
|
| · |
Although
the treatment of dividend reinvestment programs is not entirely clear,
it
is expected that your participation in the dividend reinvestment
program
will result in your being treated, for federal income tax purposes,
as
having received a distribution equal to the fair market value (and
not the
Market
Price,
whether or not discounted) of the common stock on the date actually
acquired from us. Because stockholders currently are provided a discount
from the Market Price for our common stock when they acquire shares
directly from us with reinvested cash dividends, the fair market
value of
the common stock received likely will exceed the amount of cash dividends
that otherwise would be paid to you. Such distributions will be taxable
as
dividends to the extent of our earnings and profits. These dividends
may
give rise to a liability for the payment of income tax without providing
you with the immediate cash to pay the tax when it becomes
due.
|
| · |
Sales
of common stock credited to your plan account will involve a nominal
fee
per transaction to be deducted from the proceeds of the sale by the
plan
administrator (if you request the plan administrator to make such
sale),
plus any brokerage commission and any applicable stock transfer taxes
on
the sales. (See Question 26.)
|
| · |
Because
the purchase price for stock purchased directly from us under the
plan is
based on the sales price over the five (5) trading days prior to
the
investment date, it is possible that the actual purchase price you
pay for
common stock purchased under the plan may be higher than the amount
for
which the common stock could have been purchased in the open market
on the
investment date.
|
| · |
You
cannot pledge common stock deposited in your plan account until the
shares
are withdrawn from the plan.
|
ADMINISTRATION
AND
PLAN ADMINISTRATOR
|
5.
|
Who
administers the plan?
|
We
have
appointed American Stock Transfer & Trust Company to be the plan
administrator.
7
|
6.
|
What
are the responsibilities of the plan
administrator?
|
The
plan
administrator’s responsibilities include:
| · |
administration
of the plan;
|
| · |
acting
as your agent;
|
| · |
keeping
records of all plan accounts;
|
| · |
sending
statements of activity to each
participant;
|
| · |
purchasing
and selling, on your behalf, all common stock under the plan;
and
|
| · |
the
performance of other duties relating to the
plan.
|
Holding
Shares.
If you
purchase shares through optional cash payments and do not choose to have the
dividends that are paid with respect to these shares reinvested, you must
indicate that the shares are not to be reinvested and request a stock
certificate. The plan administrator will hold any shares you choose to enroll
in
the dividend reinvestment program and will register them in the plan
administrator’s name (or that of its nominee) as your agent.
Receipt
of Dividends.
As
record holder for the plan shares, the plan administrator will credit the
dividends accrued on your plan shares as of the dividend record date to your
plan account on the basis of whole or fractional plan shares held in such
account and will automatically reinvest such dividends in additional common
stock. Any remaining portion of cash dividends not designated for reinvestment
will be sent to you.
Other
Responsibilities.
The plan
administrator also acts as dividend disbursing agent, transfer agent and
registrar for our common stock. If the plan administrator resigns or otherwise
ceases to act as plan administrator, we will appoint a new plan administrator
to
administer the plan.
|
7.
|
How
do I contact the plan
administrator?
|
You
should send all transaction requests to the administrator at:
American
Stock Transfer & Trust Company
Wall
Street Station
P.O.
Box
922
New
York,
New York 10269-0560
You
should send all correspondence to the administrator at:
American
Stock Transfer & Trust Company
59
Maiden
Lane
New
York,
New York 10038
Please
mention Capital Lease Funding, Inc. and this plan in all correspondence. In
addition, you may call the plan administrator at 866-706-0513 or contact the
plan administrator via the Internet at www.amstock.com.
PARTICIPATION
For
purposes of this section, responses are generally directed (a) to existing
stockholders according to the method by which their shares are held, or
(b) to investors who are not currently stockholders but would like to make
an initial purchase of common stock to become a participant.
Existing
stockholders are either “record owners” or “beneficial owners.” You are a record
owner if you own common stock in your own name. You are a beneficial owner
if
you own common stock that is registered in a name other than your own name
(for
example, the shares are held in the name of a broker, bank or other nominee).
A
record owner may participate directly in the plan. If you are a beneficial
owner, however, you will either have to become a record owner by having one
or
more shares transferred into your name or coordinate your participation through
the broker, bank or other nominee in whose name your shares are
held.
8
|
8.
|
Who
is eligible to
participate?
|
The
following persons are eligible to participate in the plan:
Record
Owners.
All
record owners (stockholders whose shares are held in their name on the records
kept by our transfer agent) of common stock are eligible to participate directly
in this plan.
Beneficial
Owners.
Beneficial owners (stockholders whose shares are held in the name of a broker,
bank or other nominee on the records kept by our transfer agent) of common
stock
may participate in two ways. A beneficial owner may participate directly by
becoming a record owner by having one or more shares transferred into his or
her
name from that of the applicable broker, bank or other nominee. Alternatively,
a
beneficial owner may seek to arrange with the broker, bank or other nominee
that
is the record owner of his or her shares to participate on the beneficial
owner’s behalf.
Non-Stockholders.
Individuals who do not presently own any common stock (as either a record owner
or beneficial owner) may participate in the plan by making an initial cash
purchase of common stock through the plan’s stock purchase program.
|
9.
|
Are
there limitations on participation in the plan other than those described
above?
|
Foreign
Law Restrictions.
You may
not participate in the plan if it would be unlawful for you to do so in the
jurisdiction where you are a citizen or reside. If you are a citizen or resident
of a country other than the United States, you should confirm that by
participating in the plan you will not violate local laws governing, among
other
things, taxes, currency and exchange controls, stock registration and foreign
investments.
REIT
Qualification Restrictions.
In order
for us to maintain our qualification as a REIT, not more than 50% in value
of
any class or series of our outstanding capital stock may be owned, directly
or
indirectly, by five or fewer individuals (as defined in the Internal Revenue
Code to include certain entities). We may terminate, by written notice at any
time, any participant’s individual participation in the plan if such
participation would be in violation of the restrictions contained in our Charter
or Bylaws, as amended from time to time. These restrictions prohibit any
stockholder, directly or indirectly, from beneficially owning more than 9.9%
in
value or in number, whichever is more restrictive, of our outstanding capital
stock. Any attempted transfer or acquisition of capital stock that would create
a direct or indirect ownership of capital stock in excess of this limit or
otherwise result in our disqualification as a REIT will be null and void. Our
Charter provides that capital stock subject to this limitation is subject to
various rights that we have to enforce this limitation, including conversion
of
the shares into nonvoting stock and transfer to a trust. This summary of the
ownership limitation is qualified in its entirety by reference to our Charter.
We reserve the right to invalidate any purchases made under the plan that we
determine, in our sole discretion, may violate the 9.9% ownership limit. Any
grant of a request for waiver of the maximum monthly optional cash purchase
will
not be deemed to be a waiver of such ownership limits.
Exclusion
from Plan for Short-Term Trading or Other Practices.
You
should not use the plan to engage in short-term trading activities that could
change the normal trading volume of the common stock. If you do engage in
short-term trading activities, we may prevent you from participating in the
plan. We reserve the right to modify, suspend or terminate participation in
the
plan, by otherwise eligible holders of common stock, in order to eliminate
practices which we determine, in our sole discretion, are not consistent with
the purposes or operation of the plan or which may adversely affect the price
of
the common stock.
Restrictions
at Our Discretion.
In
addition to the restrictions described above, we reserve the right to prevent
you from participating in the plan for any other reason. We have the sole
discretion to exclude you from or terminate your participation in the
plan.
9
|
10.
|
How
do I enroll in the plan?
|
Record
Owners.
Record
owners may join the plan by completing and signing an authorization form (see
Question 12) and returning it to the plan administrator, or by following the
enrollment procedures specified on the plan administrator’s website at
www.amstock.com.
Authorization forms may be obtained at any time by written request, by
contacting the plan administrator at the address and telephone number provided
in Question 7, or via the Internet at the plan administrator’s website at
www.amstock.com.
Beneficial
Owners.
A
beneficial owner may request that the number of shares the beneficial owner
wishes to be enrolled in the plan be registered by the broker, bank or other
nominee in the beneficial owner’s own name as record owner in order to
participate directly in the plan. Alternatively, beneficial owners who wish
to
join the plan may instruct their broker, bank or other nominee to arrange
participation in the plan on the beneficial owner’s behalf. The broker, bank or
other nominee should then make arrangements with its securities depository,
and
the securities depository will provide the plan administrator with the
information necessary to allow the beneficial owner to participate in the
plan.
To
facilitate participation by beneficial owners, we have made arrangements with
the plan administrator to reinvest dividends and accept optional cash payments
under the stock purchase program by record holders such as brokers, banks and
other nominees, on behalf of beneficial owners. If you are an interested
beneficial owner, be sure that your broker, bank or other nominee passes along
the proceeds of any applicable discount to your account.
Alternatively,
a beneficial owner may simply request that the number of shares the beneficial
owner wishes to be enrolled in the plan be reregistered by the broker, bank
or
other nominee in the beneficial owner’s own name as record owner in order to
participate directly in the plan.
Non-Stockholders.
A
non-stockholder may join the plan as a record owner by making an initial
investment in an amount of at least $100 and up to a maximum of $10,000 (unless
we specifically waive the maximum limit). The non-stockholder should complete
the portions of the authorization form for a non-stockholder wishing to become
a
participant and should designate the amount of the initial purchase of common
stock. At the same time, the new participant may designate all or none of the
purchased shares to be enrolled in the dividend reinvestment program. The
authorization form should be returned to the plan administrator, with payment,
on or before the applicable dates described in Question 11. The non-stockholder
may also follow the enrollment procedures specified on the plan administrator’s
website at www.amstock.com
to join
the plan. Online enrollment should be completed on or before the applicable
dates described in Question 11.
Optional
Cash Payments through Automatic Deductions.
You may
elect to have optional cash payments made through electronic fund transfers
by
completing an automatic cash investment application, which is available from
the
plan administrator at the address and telephone number provided in Question
7,
or by logging on to www.amstock.com,
and
providing both your bank account number and your bank’s routing number. The
automatic cash investment application must be accompanied by a voided bank
check
or deposit slip for the account from which you authorize the plan administrator
to draw the funds. Once the application is received and processed (which
normally takes approximately two (2) business days), funds will automatically
be
deducted from the designated account on the tenth (10th)
business day prior to each investment date and will be invested on such
investment date. In addition, you can also choose to invest monthly through
automatic deductions. Automatic deductions are subject to the same monthly
dollar maximum and minimum as other optional cash payments.
|
11.
|
When
will my participation in the plan
begin?
|
If
you
are a current stockholder and your authorization form (see Question 12) is
received by the plan administrator by the record date established for a
particular dividend, reinvestment will commence with that dividend. If your
authorization form is received after the record date established for a
particular dividend, reinvestment will begin on the dividend payment date
following the next record date if you are, or your broker, bank or other nominee
is, still a record owner. Additionally, if you have submitted your authorization
form and thus are enrolled in the plan and you wish to make optional cash
payments to purchase shares under the stock purchase program, the plan
administrator must receive full payment by two (2) business days before the
relevant investment date.
In
the
case of current non-stockholders making an initial investment, both the
authorization form and full payment of their designated initial investment
must
be received by three (3) business days before the relevant investment
date.
10
Once
you enroll in the plan, you will remain enrolled in the plan until you withdraw
from the plan, we terminate your participation in the plan or we terminate
the
plan.
|
12.
|
What
does the authorization form
provide?
|
The
authorization form appoints the plan administrator as your agent and directs
us
to pay to the plan administrator, on the applicable record date, the cash
dividends on your common stock that are enrolled in the dividend reinvestment
program, including all whole and fractional shares of common stock that are
subsequently credited to your plan account, as they are added with each
reinvestment or optional cash purchase designated for reinvestment. These cash
dividends with respect to shares enrolled in the dividend reinvestment program
will be automatically reinvested by the plan administrator in common stock.
Any
remaining cash dividends with respect to shares not enrolled in the dividend
reinvestment program will be paid directly to you.
Additionally,
the authorization form directs the plan administrator to purchase common stock
with your optional cash payments, if any, and whether to enroll all or none
of
such purchased shares in the dividend reinvestment program.
The
authorization form provides for the
purchase
of initial or additional common stock through the following investment
options:
| · |
“Full
Dividend Reinvestment” — This option directs the administrator to reinvest
cash dividends on all of the shares of common stock owned by you
then or
in the future into additional shares of common stock. This option
also
permits you to make optional cash payments from $100 to $10,000 per
month
to buy additional shares of common
stock.
|
| · |
“Partial
Dividend Reinvestment”— This option directs the administrator to reinvest
cash dividends paid on a specified number of shares of common stock
owned
by you into additional shares of common stock. We will continue to
pay you
cash dividends in the normal way on shares that you own for which
you do
not elect dividend reinvestment, when and if such dividends are declared
by our board of directors. This option also permits you to make optional
cash payments from $100 to $10,000 per month to buy additional shares
of
common stock.
|
| · |
“Optional
Cash Payments Only” — This option permits you to make optional cash
investments from $100 to $10,000 per month to buy additional shares
of
common stock. We will continue to pay cash dividends, when and if
declared
by our board of directors, on the shares of common stock owned by
you then
or in the future, unless you designate the shares for reinvestment
pursuant to the plan.
|
Unless
you designate all or none of your new plan shares for enrollment in the dividend
reinvestment program, you will be enrolled as having selected the full dividend
reinvestment option. In addition, if you return a properly executed
authorization form to the plan administrator without electing an investment
option, you will be enrolled as having selected the full dividend reinvestment
option.
You
may
select any one of the options desired, and the designated options will remain
in
effect until you specify otherwise by indicating a different option on a new
authorization form, by withdrawing some or all shares from the plan in favor
of
receiving cash dividends or in order to sell your common stock, or until the
plan is terminated.
|
13.
|
What
does the plan administrator’s
website provide?
|
Instead
of submitting an authorization form (see Question 12), you can participate
in
the plan by accessing the plan administrator’s website at www.amstock.com.
You may
do the following online:
| · |
enroll
or terminate your participation in the
plan;
|
| · |
make
initial and additional purchases of common
stock;
|
| · |
sell
shares of common stock;
|
11
| · |
request
a stock certificate for non-fractional shares of common stock held
in your
plan account; and
|
| · |
view
your account history and balances.
|
PURCHASES
AND PRICES OF
SHARES
|
14.
|
How
does the stock purchase program
work?
|
All
current record owners and non-stockholders who have timely submitted signed
authorization forms or online requests via www.amstock.com
indicating their intention to participate in this program of the plan, and
beneficial owners whose brokers, banks or other nominees have timely submitted
authorization forms or online requests via www.amstock.com
indicating their intention to participate in this program are eligible to make
optional cash payments during any month, whether or not a dividend is declared.
Each month the plan administrator will apply any optional cash payment received
from a participant by the deadline described below to the purchase of additional
common stock for the account of the participant on the following investment
date
and will enroll all such shares in the dividend reinvestment program unless
the
participant requests that such shares not be subject to the dividend
reinvestment program.
Deadline
for Submitting Optional Cash Payments.
Optional
cash payments will be invested every month on the related investment date,
which
will generally be the 15th of each month or, if such date is not a business
day,
the first business day thereafter (See Question 18). The deadline for submitting
optional cash payments is two (2) business days prior to the relevant investment
date.
Each
month the plan administrator will apply an optional cash payment for which
funds
are timely received to the purchase of common stock for your account on the
next
investment date. In order for funds to be invested on the next investment date,
the plan administrator must have received a check or money order by the deadline
for submitting optional cash payments. Checks and money orders are accepted
subject to timely collection as funds and verification of compliance with the
terms of the plan. Checks or money orders should be made payable to “American
Stock Transfer & Trust Company — Capital Lease Funding, Inc. DRSPP.” Checks
returned for any reason will not be resubmitted for collection. The
administrator reserves the right to sell any shares that have been purchased
for
your account to recover the amount of a returned check. In addition, the
administrator may have to sell additional shares from your account if the sale
of the shares purchased in your account is not sufficient to cover the returned
check. Additionally, shares will be sold from a participant’s account to offset
a $25 returned check fee.
No
Interest on Optional Cash Payments.
No
interest will be paid by us or the plan administrator on optional cash payments
pending investment. Since no interest is paid on cash held by the plan
administrator, it normally will be in your best interest to defer optional
cash
payments until shortly before the deadline described above. Generally, optional
cash payments received after the deadline will be held by the plan administrator
and invested on the next investment date.
Refunds
of Uninvested Optional Cash Payments.
Upon
written request to the plan administrator received at least five (5) business
days prior to the deadline for submitting optional cash payments for the
investment date with respect to which optional cash payments have been delivered
to the plan administrator, your optional cash payments will be returned to
you
as soon as practicable. Requests received less than five (5) business days
prior
to such date will not be returned but instead will be held by the plan
administrator and invested on the next investment date.
Additionally,
optional cash payments will be returned by check, without interest, as soon
as
practicable after the applicable period in which the price of the common stock
is determined if the minimum Market Price, if any, applicable to optional cash
payments made pursuant to requests for waiver of the maximum limit on optional
cash payments shall not have been met. (See Question 20.)
Also,
each optional cash payment, to the extent that it does not conform to the
limitations described in Question 19 will be subject to return to you, without
interest, as soon as practicable.
|
15.
|
What
will be the price of shares purchased under the
plan?
|
Purchase
Price and Discounts.
The
purchase price of common stock under the plan depends on whether we issue new
shares to you or the plan obtains your shares by purchasing them in the open
market, and whether any discount is being offered by us at the time of the
applicable common stock purchase.
12
With
respect to reinvested dividends and optional cash payments of $10,000 or less,
we are currently offering a 2% discount off of the Market Price (as determined
below), but that discount may not exceed 5% of the average of the high and
low
sales prices on the applicable investment date. As such, the purchase price
for
common stock that the plan administrator purchases directly from us at this
time
generally will be 98% of the Market
Price
of
the common stock. The discount from the Market
Price
for
common stock that the plan administrator purchases directly from us may be
changed or eliminated by us from time to time, provided that in no event will
the discount exceed 5% of the average of the high and low sales prices on the
applicable investment date. If you are a participant in the plan, you will
be
provided with at least thirty (30) days’ prior written notice of any change in
this discount.
With
respect to reinvested dividends and optional cash payments of $10,000 or less,
the purchase price for common stock that the plan administrator purchases from
parties other than us, either in the open market or in privately negotiated
transactions, will be 100% of the “average price per share” actually paid by the
plan administrator, excluding any brokerage commissions. We are not required
to
provide any written notice to you as to the source of the common stock to be
purchased under the plan.
With
respect to optional cash payments greater than $10,000, the purchase price
for
common stock that the plan administrator purchases directly from us will be
the
Market
Price
of
the common stock less any discount that we may elect to offer, provided that
in
no event will the discount exceed 5% of the average of the high and low sales
prices on the applicable investment date. The Market
Price
for
optional cash payments in excess of $10,000 is determined in the same manner
as
for optional cash payments of less than $10,000, except that we may set a
minimum price that the Market Price must equal or exceed. We will refund the
investment if the Market Price does not equal or exceed the minimum price.
We
will set the minimum price and any applicable discount, if any, at least four
(4) business days before the first day of the applicable five-day pricing
period. Written notice of the minimum price and the applicable discount, if
any,
at any time will not be provided to you. You must call us to obtain the minimum
price and applicable discount, if any. (See Question 20.)
With
respect to optional cash payments greater than $10,000, the purchase price
for
common stock that the plan administrator purchases from parties other than
us,
either in the open market or in privately negotiated transactions, will be
100%
of the average price per share actually paid by the plan administrator,
excluding any brokerage commissions.
Optional
cash investments of less than $100 and that portion of any optional cash
investment in excess of the maximum monthly purchase limit of $10,000, unless
we
have waived such maximum limit, will be returned to you without
interest.
Each
of
the discounts, if any, is subject to change from time to time (but will not
exceed 5% of the average of the high and low sales prices of our common stock
on
the applicable investment date) and is also subject to discontinuance at our
discretion at any time based on a number of factors, including current market
conditions, the level of participation in the plan and our current and projected
capital needs. Except with respect to the discount applicable to optional cash
payments in excess of the $10,000 limit, we will provide participants with
at
least thirty (30) days’ prior written notice of a change in the applicable
discount.
Determination
of “Market Price” and “Average Price Per Share.”
For
purposes of the calculation of the purchase price for shares purchased directly
from us, “Market
Price”
is
equal to the average of the daily high and low sales prices, computed to three
decimal places, of the common stock on the New York Stock Exchange or other
securities exchange where the common stock is traded, as reported in The Wall
Street Journal, during the five (5) days on which the New York Stock Exchange
or
such other securities exchange is open and for which trades in our common stock
are reported immediately preceding the relevant investment date, or, if no
trading occurs in our common stock on one or more of such days, for the five
(5)
days immediately preceding the investment date for which trades are
reported.
For
purposes of the calculation of the purchase price for shares purchased from
parties other than us, either on the open market or in privately negotiated
transactions, “average price per share” is equal to the weighted average of the
actual prices paid, computed to three decimal places, for all of the common
stock purchased with all participants’ reinvested dividends and optional cash
payments for the related month.
Plan
Administrator’s Control of Purchase Terms.
When
open market purchases are made by the plan administrator, these purchases may
be
made on any securities exchange where our common stock is traded, in the
over-the-counter market or by negotiated transactions, and may be subject to
the
terms with respect to price, delivery and other matters to which the plan
administrator agrees. We do not, and you will not, have any authorization or
power to direct the time or price at which shares will be purchased or the
selection of the broker or dealer through or from whom purchases are to be
made
by the plan administrator. However, when open market purchases are made by
the
plan administrator, the plan administrator shall use its best efforts to
purchase the shares at the lowest possible price.
13
|
16.
|
How
will the number of shares purchased for my account be
determined?
|
Your
account will be credited with the number of shares, including fractions computed
to three decimal places, equal to the total amount to be invested on your
behalf, divided by the applicable discounted price per share, calculated
pursuant to the methods described above, as applicable.
The
total
amount to be invested will depend on the amount of any dividends paid on the
number of shares you own and have designated for reinvestment, and the amount
of
any optional cash payments you have made and available for investment on the
related investment date. Subject to the availability of common stock registered
for issuance under the plan, there is no total maximum number of shares
available for issuance pursuant to the reinvestment of dividends.
The
amount of reinvested dividends to be invested will be reduced by any amount
we
are required to deduct for federal tax withholding purposes. (See Question
29.)
|
17.
|
What
is the source of common stock purchased under the
plan?
|
The
plan
administrator will purchase common stock either directly from us or from parties
other than us, either on the open market or through privately negotiated
transactions, or by a combination of the foregoing. We will determine the source
of the common stock to be purchased under the plan after a review of current
market conditions and our current and projected capital needs. We and the plan
administrator are not required to provide any written notice to you as to the
source of the common stock to be purchased under the plan.
|
18.
|
What
are investment dates and when will dividends or other money be
invested?
|
Shares
purchased under the plan will be purchased on the “investment date” in each
month. The investment date with respect to the common stock acquired pursuant
to
dividend reinvestments will be (i) if acquired directly from us, the quarterly
dividend payment date declared by our Board of Directors or (ii) in the case
of
open market purchases, as soon as practicable following the date or dates of
actual investment. The investment date for shares acquired pursuant to optional
cash payments will be (i) if acquired directly from us, generally the fifteenth
(15th)
of each
month or, if such date is not a business day, the first business day thereafter
or (ii) in the case of open market purchases, as soon as practicable following
the date or dates of actual investment.
For
the
reinvestment of dividends, the record date is the record date declared by our
Board of Directors for that dividend. Likewise, the dividend payment date
declared by the Board of Directors constitutes the investment date. In the
past,
record dates for dividends generally have preceded the dividend payment dates
by
approximately fifteen (15) days. We historically have paid dividends on or
about
the fifteenth (15th)
day of
each January, April, July and October. We cannot assure you that we will pay
dividends according to this schedule in the future, and nothing contained in
the
plan obligates us to do so. Neither we nor the plan administrator will be liable
when conditions, including compliance with the rules and regulations of the
Securities and Exchange Commission, prevent the plan administrator from buying
common stock or interfere with the timing of purchases. We pay dividends as
and
when declared by our Board of Directors. We cannot assure you that we will
declare or pay a dividend in the future, and nothing contained in the plan
obligates us to do so. The plan does not represent a guarantee of future
dividends.
Shares
will be allocated and credited to your plan accounts on the appropriate
investment date.
No
interest will be paid on cash dividends pending investment or reinvestment
under
the terms of the plan.
|
19.
|
What
limitations apply to optional cash
payments?
|
For
any
investment date that you choose to make an optional cash payment, you must
invest at least $100 but not more than $10,000. For purposes of these
limitations, all plan accounts under common control, management or
representation by a broker, bank or other nominee will be aggregated. Optional
cash payments of less than $100 and that portion of any optional cash payment
which exceeds the maximum monthly purchase limit of $10,000, unless we have
waived such maximum limit, will be returned to you without interest after the
applicable period in which the price of the common stock is
determined.
14
|
20.
|
How
do I make optional cash payments over the $10,000 maximum monthly
amount?
|
Request
for Waiver.
Optional
cash payments in excess of $10,000 per month may be made only pursuant to a
request for waiver approved by us. If you wish to submit an optional cash
payment in excess of $10,000 for any investment date, you must obtain our prior
written approval, and a copy of such written approval must accompany any such
optional cash payment.
At
least
four (4) business days prior to the first day of the applicable five-day pricing
period, we will determine whether to establish a minimum price (as described
below) and/or a discount applicable to optional cash payments in excess of
the
$10,000 maximum. We will make this determination in our discretion after a
review of such considerations as transaction costs, current market conditions,
the level of participation in the plan, and current and projected capital needs.
You may ascertain whether a minimum price has been set or waived, and obtain
the
applicable discount, for the given month by telephoning our Investor Relations
Department at (212) 217-6393.
A
request
for waiver must then be received by us by facsimile at (212) 217-6301 for that
month at least three (3) business days before the first day of the applicable
five-day pricing period (i.e., eight (8) business days before the relevant
investment date). If we grant the waiver, you must submit our written waiver
along with payment no later than the close of business on the last business
day
immediately preceding the first day of the pricing period. Please refer to
Question 14 for further procedural details with respect to submitting timely
payments.
Minimum
Price.
We may
establish, for any period in which the price of the common stock is determined,
a minimum price applicable to optional cash payments made pursuant to requests
for waiver of the $10,000 limit on optional cash payments. We will state any
minimum price as a dollar amount that the Market Price as described in Question
15 must equal or exceed. If the minimum price is not satisfied, optional cash
payments made pursuant to a request for waiver of the $10,000 limit on optional
cash payments will be returned to you by check, without interest, as soon as
practicable after the applicable period in which the price of the common stock
is determined.
The
establishment of a minimum price and the possible return of the investment
applies only to optional cash payments made pursuant to a request for waiver
of
the $10,000 limit on optional cash payments. Setting a minimum price for a
period will not affect the setting of a minimum price for any subsequent period.
We and the plan administrator are not required to provide any written notice
to
you as to the minimum price for any period, although we will respond to your
request for that information as described above.
Waiver
Discount.
Each
month we may establish a discount from the Market
Price
applicable only to optional cash payments made pursuant to a request for waiver
of the $10,000 limit on optional cash payments. This discount may be between
0%
and 5% of the purchase price and may vary each month, but in no event will
the
discount exceed 5% of the average of the high and low sales prices of our common
stock on the applicable investment date. Once established for a particular
month, this discount will apply uniformly to all optional cash payments made
pursuant to an approved request for waiver of the $10,000 limit on optional
cash
payments for that month. Setting such a discount for a particular month will
not
affect the setting of a discount for any subsequent month. This discount will
apply to the entire optional cash payment and not just to the portion that
exceeds $10,000.
The
establishment of such a discount applies only to optional cash payments made
pursuant to a request for waiver of the $10,000 limit on optional cash payments.
All other optional cash payments will currently be made at the Market
Price
subject to any discount offered as described in Question 15 and shall not be
subject to any discount established pursuant to the preceding
paragraph.
Our
Rights Regarding Approval of Waiver Requests.
We have sole discretion whether to grant any approval for optional cash payments
in excess of the allowable maximum amount.
In
deciding whether to approve your request for a waiver, we will consider a
variety of relevant factors including, but not limited to:
| · |
transaction
costs;
|
15
| · |
whether,
at the time of the request, the plan administrator is acquiring newly
issued shares directly from us or acquiring shares in the open
market;
|
| · |
our
need for additional funds;
|
| · |
the
attractiveness of obtaining these additional funds through the sale
of
common stock as compared to other sources of
funds;
|
| · |
the
purchase price likely to apply;
|
| · |
the
extent and nature of your prior participation in the
plan;
|
| · |
the
number of shares of common stock you hold of record or beneficially;
and
|
| · |
the
aggregate amount of optional cash payments in excess of $10,000 for
which
requests for waiver have been
submitted.
|
If
requests for waiver are submitted for any investment date for an aggregate
amount in excess of the amount we are then willing to accept, we may honor
these
requests in order of receipt, pro
rata
or by
any other method that we determine to be appropriate. There is no
pre-established maximum limit applicable to optional cash payments that may
be
made pursuant to approved requests for waiver, except the availability of common
stock registered for issuance pursuant to the plan.
|
21.
|
Will
I incur expenses in connection with my participation under the
plan?
|
You
will
not pay brokerage commissions or service fees to purchase common stock through
the plan. We will pay all other costs of administration of the plan. However,
if
you request that the plan administrator sell all or any portion of your shares,
you will incur fees as described under Question 26 below. Additionally, if
you
elect to send certificates for any other of our common stock that you own to
the
plan administrator for safekeeping, you will incur a one-time fee of $7.50
for
this service.
REPORTS
TO
PARTICIPANTS
|
22.
|
How
will I keep track of my
investments?
|
You
will
receive a statement of your account following each purchase of additional
shares, whether by reinvestment of dividends or by optional cash payments.
This
detailed statement will provide you with the following information with respect
to your plan account:
| · |
total
number of shares of common stock purchased, including fractional
shares;
|
| · |
price
paid per share of common stock;
|
| · |
date
of stock purchases; and
|
| · |
total
number of shares of common stock in your plan
account.
|
You
should retain these statements to determine the tax cost basis of the shares
purchased for your account under the plan. In addition, you will receive copies
of other communications sent to our stockholders, including our annual report
to
stockholders, the notice of annual meeting and proxy statement in connection
with our annual meeting of stockholders and Internal Revenue Service information
for reporting dividends paid.
You
can
also view your account history and balance online by accessing the plan
administrator’s website at www.amstock.com.
16
DIVIDENDS
ON FRACTIONS OF SHARES
|
23.
|
Will
I be credited with dividends on fractions of
shares?
|
Yes.
Any
fractional share held in your plan account (see Question 16) that has been
designated for participation in the dividend reinvestment program of the plan
will receive a proportionate amount of any dividend declared on our common
stock.
CERTIFICATES
FOR SHARES
|
24.
|
Will
I receive certificates for shares
purchased?
|
Safekeeping
of Certificates.
Normally, common stock purchased for you under the plan will be held in the
name
of the plan administrator or its nominee. The plan administrator will credit
the
shares to your plan account in “book-entry” form. This service protects against
loss, theft or destruction of certificates evidencing common stock.
You
may
also elect to deposit with the plan administrator certificates for other shares
of common stock that you own and that are registered in your name for
safekeeping under the plan for a one-time fee of $7.50. The plan administrator
will credit the common stock represented by the certificates to your account
in
“book-entry” form and will combine the shares with any whole and fractional
shares then held in your plan account. In addition to protecting against the
loss, theft or destruction of your certificates, this service is convenient
if
and when you sell common stock through the plan. Because you bear the risk
of
loss in sending certificates to the plan administrator, you should send
certificates by registered mail, return receipt requested, and properly insured
to the address specified in Question 7 above.
Issuance
of Certificates.
No
certificates will be issued to you for shares in the plan unless you submit
a
written request to the plan administrator or until your participation in the
plan is terminated. At any time, you may request the plan administrator to
send
a certificate for some or all of the whole shares credited to your account.
This
request should be mailed to the plan administrator at the address set forth
in
the answer to Question 7 or made via the Internet at www.amstock.com.
There
is no fee for this service. Any remaining whole shares and any fraction of
a
share will remain credited to your plan account. Certificates for fractional
shares will not be issued under any circumstances.
|
25.
|
In
whose name will certificates be registered when
issued?
|
Your
plan
account will be maintained in the name in which your certificates were
registered at the time of your enrollment in the plan. Stock certificates for
those shares purchased under the plan will be similarly registered when issued
upon your request. If your shares are held through a broker, bank or other
nominee, such request must be placed through your broker, bank or other
nominee.
SALE
OF SHARES
|
26.
|
How
do I sell shares held in my plan
account?
|
You
may
contact the plan administrator to sell all or any part of the shares held in
your plan account. After receipt of your request, the plan administrator will
sell the shares through a designated broker or dealer. The plan administrator
will mail to you a check for the proceeds of the sale, less applicable brokerage
commissions, service charges and any taxes. The plan administrator will sell
shares as often as daily but at least within five (5) business days of receipt
of the sale request, at then current market prices through one or more brokerage
firms. If you sell or transfer only a portion of the shares in your plan
account, you will remain a participant in the plan and may continue to make
optional cash investments and reinvest dividends. If you have elected to have
your dividends reinvested, the plan administrator will continue to reinvest
the
dividends on the shares credited to your account unless you notify the plan
administrator that you wish to withdraw from the plan.
The
plan
requires you to pay all costs associated with the sale of your shares under
the
plan. You will receive the proceeds of the sale, less a $15 service fee per
transaction and a $0.10 per share brokerage commission paid to the plan
administrator and any other applicable fees.
17
If
the
plan administrator sells all shares held in your plan account, the plan
administrator will automatically terminate your account. In this case, you
will
have to complete and file a new authorization form to rejoin the
plan.
WITHDRAWALS
AND TERMINATION
|
27.
|
When
may I withdraw from the
plan?
|
You
may
withdraw from the plan with respect to all or a portion of the shares held
in
your plan account at any time. If the request to withdraw is received prior
to a
dividend record date set by our Board of Directors for determining stockholders
of record entitled to receive a dividend, the request will be processed on
the
first business day following receipt of the request by the plan
administrator.
If
the
request to withdraw from the plan is received by the plan administrator at
least
three (3) business days prior to the dividend payable date, then that dividend
will be paid out in cash to the participant. However, if the request to withdraw
from the plan is received less than three (3) business days prior to the
dividend payable date, then that dividend will be reinvested. However, all
subsequent dividends will be paid out in cash on all balances.
Any
optional cash payments which have been sent to the plan administrator prior
to a
request for withdrawal will also be invested on the next investment date unless
you expressly request return of that payment in the request for withdrawal,
and
the request for withdrawal is received by the plan administrator at least five
(5) business days prior to the deadline for submitting such optional cash
payments.
|
28.
|
How
do I withdraw from the
plan?
|
If
you
wish to withdraw from the plan with respect to all or a portion of the shares
in
your plan account, you must notify the plan administrator in writing at its
mailing address or via its Internet address specified in the answer to Question
7. Upon your withdrawal from the plan or our termination of the plan,
certificates for the appropriate number of whole shares credited to your account
under the plan will be issued free of charge. A cash payment will be made for
any fraction of a share.
Upon
withdrawal from the plan, you may also request in writing that the plan
administrator sell all or part of the shares credited to your plan account.
(See
Question 26.)
OTHER
INFORMATION
|
29.
|
What
are some of the tax consequences of my participation in the
plan?
|
The
federal tax treatment of dividend reinvestment and stock purchase programs
is
not entirely clear. You are encouraged to consult your personal tax advisor
with
specific reference to your own tax situation and potential changes in the
applicable law as to all federal, state, local, foreign and other tax matters
in
connection with the reinvestment of dividends and purchase of shares under
the
plan, your tax basis and holding period for shares acquired under the plan
and
the character, amount and tax treatment of any gain or loss realized on the
disposition of shares. The following is a brief summary of the material federal
income tax considerations applicable to the plan, is for general information
only, and does not constitute tax advice.
Tax
Consequences of Dividend Reinvestment Program.
Although
the treatment of dividend reinvestment programs is not entirely clear, if you
participate in the dividend reinvestment program under the plan, it is expected
that you will be treated for federal income tax purposes as having received,
on
the investment date, a distribution in an amount equal to the sum of
(a) the fair market value of the shares on the date the shares were
acquired with reinvested dividends, (b) your pro
rata
share of
any brokerage commissions paid by us in connection with the purchase of common
stock by the plan administrator from parties other than us, either on the open
market or in privately negotiated transactions and (c) any cash
distributions actually received by you with respect to common stock not included
in the plan. The tax basis of shares purchased under the plan will be equal
to
the fair market value of the shares on the date the shares were acquired plus
your pro
rata
share of
any brokerage fees paid by us. The fair market value on that specific date
may
vary from the Market
Price
determined under the plan for such shares.
18
Tax
Consequences of the Stock Purchase Program.
Although
the treatment of stock purchase programs is not entirely clear, if you
participate in the stock purchase program under the plan, it is expected that
you will be treated for federal income tax purposes as having received, on
the
investment date, a distribution equal to the excess, if any, of the fair market
value of the common stock on this date over the amount of your optional cash
payment. In addition, you will be treated as having received a distribution
equal to your pro
rata
share of
any brokerage commissions paid by us in connection with the purchase of common
stock by the plan administrator from parties other than us. Shares acquired
through the stock purchase program under the plan should have a tax basis equal
to the amount of the payment plus the total amount of distributions you are
treated as receiving as described above. The fair market value on an investment
date may differ from the Market Price determined under the plan for such
shares.
Distributions
that you receive as a result of dividend reinvestment and/or optional stock
purchase will be taxable as dividends to the extent of our current or
accumulated earnings and profits. To the extent the distributions are in excess
of our current or accumulated earnings and profits, the distributions will
be
treated first as a tax-free return of capital, reducing the tax basis in your
shares, and the distributions in excess of your tax basis, if any, will be
taxable as gain realized from the sale of your shares. In addition, if we
designate part or all of our distributions as capital gain distributions, those
designated amounts will be treated by you as long-term capital
gains.
Your
holding period for shares acquired pursuant to either program under the plan
will begin on the day following the investment date. Dividends received by
corporate stockholders will not be eligible for the dividends received
deduction.
You
will
not realize any taxable income upon receipt of certificates for whole shares
credited to your account, either upon your request for certain of those shares
or upon termination of participation in the plan. You will realize gain or
loss
upon the sale or exchange of shares acquired under the plan. You will also
realize gain or loss upon receipt, following termination of participation in
the
plan, of a cash payment for any fractional share equivalent credited to your
account. The amount of any such gain or loss will be the difference between
the
amount that you received for the shares or fractional share equivalent and
the
tax basis thereof.
Income
Tax Withholding and Administrative Expense.
We or
the plan administrator may be required to deduct as “backup withholding”
twenty-eight percent (28%) of all dividends paid to you, regardless of whether
such dividends are reinvested pursuant to the plan. Similarly, the plan
administrator may be required to deduct backup withholding from all proceeds
from sales of common stock held in your account. You are subject to backup
withholding if: (a) you have failed properly to furnish us and the plan
administrator with your correct tax identification number (“TIN”); (b) the
Internal Revenue Service or a broker notifies us or the plan administrator
that
the TIN furnished by you is incorrect; (c) the Internal Revenue Service or
a
broker notifies us or the plan administrator that backup withholding should
be
commenced because you failed to properly report dividends paid to you; or (d)
when required to do so, you fail to certify, under penalties of perjury, that
you are not subject to backup withholding. Backup withholding amounts will
be
withheld from dividends before such dividends are reinvested under the plan.
Therefore, if you are subject to backup withholding, dividends to be reinvested
under the plan will be reduced by the backup withholding amount. If you are
a
foreign stockholder you need to provide the required federal income
certifications to establish your status as a foreign stockholder so that the
foregoing backup withholding does not apply to you. You also need to provide
the
required certifications if you wish to claim the benefit of exemptions from
federal income tax withholding or reduced withholding rates under a treaty
or
convention entered into between the United States and your country of residence.
If you are a foreign stockholder whose dividends are subject to federal income
tax withholding, the appropriate amount will be withheld and the balance in
shares of common stock will be credited to your account.
Foreign
stockholders who elect to make optional cash payments only will continue to
receive regular cash dividends on shares registered in their names in the same
manner as if they were not participating in this plan. Funds for optional cash
payments must be in United States dollars and will be invested in the same
way
as payments from other participants.
All
costs
of administering the plan, except for costs related to your voluntary selling
of
common stock, will be paid by us. Consistent with the conclusion reached by
the
Internal Revenue Service in a private letter ruling issued to another REIT,
we
intend to take the position that these costs do not constitute a distribution
which is either taxable to you or which would reduce your basis in your shares.
However, since the private letter ruling was not issued to us, we have no legal
right to rely on its conclusions. Thus, it is possible that the Internal Revenue
Service might view your share of the costs as constituting a taxable
distribution to you and/or a distribution which reduces the basis in your common
stock. For this or other reasons, we may in the future take a different position
with respect to the costs of administering the plan.
19
|
30.
|
May
shares in my account be
pledged?
|
You
may
not pledge any of the common stock in your plan account. Any attempted pledge
of
these shares will be void. If you wish to pledge shares, you must first withdraw
them from the plan.
|
31.
|
If
we issue rights to purchase securities to the holders of common stock,
how
will the rights on plan shares be
handled?
|
In
the
event that we make available to the holders of our common stock rights to
purchase additional shares of common stock or any other securities, the plan
administrator will sell these rights (if the rights are saleable and detachable
from the common stock) accruing to common stock held by the plan administrator
for you and invest the proceeds in additional shares of common stock on the
next
dividend payment date for the common stock. In the event these rights are not
saleable or detachable, the plan will hold the rights for your benefit. If
you
wish to receive directly any of these rights, you may do so by sending to the
plan administrator, at least five (5) business days before the rights offering
record date, a written request that certificates for shares in your account
be
sent to you.
Transaction
processing may be curtailed or suspended until the completion of any stock
dividend, stock split or similar corporate action.
|
32.
|
What
happens if we declare a dividend payable in shares or declare a share
split?
|
Any
dividend payable in shares and any additional shares distributed by us in
connection with a share split in respect of shares credited to your plan account
will be added to that account. Share dividends or split shares which are
attributable to shares registered in your own name and not in your plan account
will be mailed directly to you as in the case of stockholders not participating
in the plan.
Transaction
processing may be curtailed or suspended until the completion of any stock
dividend, stock split or similar corporate action.
|
33.
|
How
will shares held by the plan administrator be voted at meetings of
stockholders?
|
If
you
are a record owner, you will receive a proxy card covering both directly held
shares and shares held in the plan. If you hold your shares through a broker,
bank or other nominee, you should receive a proxy covering shares held in the
plan from your broker, bank or other nominee.
If
a
proxy is returned properly signed and marked for voting, all of the shares
covered by the proxy will be voted as marked. If a proxy is returned properly
signed but no voting instructions are given, all of your shares will be voted
in
accordance with recommendations of our Board of Directors, unless applicable
laws require otherwise. If the proxy is not returned, or if it is returned
unexecuted or improperly executed, shares registered in your name may be voted
only by you and only in person.
|
34.
|
What
are our responsibilities and those of the plan administrator under
the
plan?
|
Neither
we, any of our agents nor the plan administrator, will be liable in
administering the plan for any act done in good faith or required by applicable
law or for any good faith omission to act, including, without limitation, any
claim of liability (i) arising out of failure to terminate your account upon
your death or judgment of incompetence prior to the plan administrator’s receipt
of notice in writing of such death or judgment of incompetence, (ii) with
respect to the price at which shares are purchased or sold and/or the times
when
such purchases or sales are made, or (iii) relating to any fluctuation in the
market value of the common stock.
Neither
we, any of our agents nor the plan administrator, will have any duties,
responsibilities or liabilities other than those expressly set forth in the
plan
or as imposed by applicable laws, including federal securities laws. Since
the
plan administrator has assumed all responsibility for administering the plan,
we
specifically disclaim any responsibility for any of the plan administrator’s
actions or inactions in connection with the administration of the plan. None
of
our directors, officers, employees or stockholders will have any personal
liability under the plan.
20
We,
any
of our agents and the plan administrator will be entitled to rely on completed
forms and the proof of due authority to participate in the plan, without further
responsibility of investigation or inquiry.
|
35.
|
What
will be my responsibilities under the
plan?
|
Your
plan
shares may revert to the state in which you live in the event that the shares
are deemed, under your state’s laws, to have been abandoned by you. For this
reason, you should notify the plan administrator promptly in writing of any
change of address. The plan administrator will address account statements and
other communications to you at the last address of record you provide to the
plan administrator.
You
will
have no right to draw checks or drafts against your plan account or to instruct
the plan administrator with respect to any common stock or cash held by the
plan
administrator except as expressly provided herein.
|
36.
|
May
the plan be changed or
discontinued?
|
Yes.
We
may suspend, terminate, or amend the plan at any time. Notice will be sent
to
you of any suspension or termination, or of any amendment that alters the plan
terms and conditions, as soon as practicable after we take such an action.
We
may also substitute another agent in place of the current plan administrator
at
any time; you will be promptly informed of any such substitution. We will
determine any questions of interpretation arising under the plan and any such
determination will be final.
|
37.
|
Are
there any risks associated with the
plan?
|
Your
investment in shares held in your plan account is no different from your
investment in shares held directly. Neither we nor the plan administrator can
assure you a profit or protect you against a loss on the shares that you
purchase. You bear the risk of any loss and enjoy the benefits of any gain
from
market price changes with respect to such shares. You should read carefully
the
risk factors described in our Securities and Exchange Commission filings before
investing in our common stock.
|
38.
|
How
will you interpret and regulate the
plan?
|
We
will
interpret, regulate and take any other action in connection with the plan that
we deem reasonably necessary to carry out the plan. We may adopt rules and
regulations
to
facilitate the administration of the plan. As a participant in the plan, you
will be bound by any actions taken by us or the plan administrator.
|
39.
|
What
law governs the plan?
|
The
terms
and conditions of the plan and its operation will be governed by the laws of
the
State of Maryland.
21
PLAN
OF DISTRIBUTION
Except
to
the extent the plan administrator purchases common stock in the open market
or
in privately negotiated transactions with third parties, the common stock
acquired under the plan will be sold directly by us through the plan. We may
sell our common stock to owners of shares (including brokers or dealers) who,
in
connection with any resales of such shares, may be deemed to be underwriters.
These shares, including shares acquired through waivers granted with respect
to
the stock purchase program of the plan, may be resold in market transactions
(including coverage of short positions) on any national security exchange or
automated quotation system on which our common stock is traded or quoted, or
in
privately negotiated transactions. Our common stock is currently listed on
the
New York Stock Exchange. It is expected that a portion of the common stock
available for issuance under the plan will be issued pursuant to waivers granted
with respect to the stock purchase program of the plan. The difference between
the price owners who may be deemed to be underwriters pay us for shares of
our
common stock acquired under the plan, after deduction of the applicable discount
from the Market Price, and the price at which such shares are resold, may be
deemed to constitute underwriting commissions received by these owners in
connection with such transactions.
Subject
to the availability of common stock registered for issuance under the plan,
there is no maximum number of shares that can be issued pursuant to the
reinvestment of dividends. From time to time, financial intermediaries may
engage in positioning transactions in order to benefit from the discount from
the Market Price acquired through the reinvestment of dividends and optional
cash payments under the plan.
Except
with respect to sales of common stock held in your plan account, we will pay
any
and all brokerage commissions and related expenses incurred in connection with
purchases of common stock under the plan. Upon your withdrawal from the plan
by
the sale of common stock held under the plan, you will receive the proceeds
of
such sale less a $15 service fee per transaction and a $0.10 per share brokerage
commission to the plan administrator and any other applicable fees.
Common
stock may not be available under the plan in all states. This prospectus does
not constitute an offer to sell, or a solicitation of an offer to buy, any
common stock or other securities in any state or any other jurisdiction to
any
person to whom it is unlawful to make such offer in such
jurisdiction.
LEGAL
MATTERS
The
validity of the common stock offered by this prospectus and certain U.S. federal
income tax matters have been passed upon for us by Hunton & Williams
LLP.
EXPERTS
The
consolidated financial statements, the related financial statement schedules,
and management’s report on the effectiveness of internal control over financial
reporting as of and for the year ended December 31, 2005 incorporated by
reference in this prospectus and registration statement have been audited by
McGladrey & Pullen LLP, an independent registered public accounting firm, as
stated in their report thereon, and are incorporated herein and in reliance
upon
such reports and upon the authority of such firm as experts in auditing and
accounting.
The
consolidated financial statements of Capital Lease Funding, Inc., appearing
in
Capital Lease Funding, Inc.’s Annual Report (Form 10-K), for the year ended
December 31, 2004, and for the two years in the period ended December 31, 2004,
have been audited by Ernst & Young LLP, independent registered public
accounting firm, as set forth in their report thereon, included therein, and
incorporated herein by reference. Such consolidated financial statements are
incorporated herein by reference in reliance upon such report given on the
authority of such firm as experts in accounting and auditing.
22
WHERE
YOU CAN FIND MORE INFORMATION
We
file
annual, quarterly and current reports, proxy statements and other information
with the SEC under the Securities Exchange Act of 1934, as amended (the
“Exchange Act”). You may read and copy any reports, statements or other
information on file at the SEC’s public reference room located at 100 F Street,
N.E., Room 1580, Washington, D.C. 20549. Please call the SEC at 1-800-SEC-0330
for further information on the public reference room. The SEC filings are also
available at the Internet website maintained by the SEC at http://www.sec.gov.
These
filings are also available to the public from commercial document retrieval
services.
We
incorporate information into this prospectus by reference, which means that
we
disclose important information to you by referring you to another document
filed
separately with the SEC. The information incorporated by reference is deemed
to
be part of this prospectus, except to the extent superseded by information
contained herein or by information contained in documents filed with the SEC
after the date of this prospectus. This prospectus incorporates by reference
the
documents set forth below, the file number for each of which is 1-32039, that
have been previously filed with the SEC:
| · |
our
Annual Report on Form 10-K for the year ended December 31, 2005 filed
with
the SEC on March 16, 2006;
|
| · |
our
Quarterly Reports on Form 10-Q for the quarters ended March 31, 2006
(filed May 10, 2006), June 30, 2006 (filed August 4, 2006) and September
30, 2006 (filed November 6, 2006);
and
|
| · |
our
Current Reports on Form 8-K or Form 8-K/A, as the case may be, filed
with
the SEC on January 27, 2006, February 1, 2006, March 6, 2006, March
30,
2006, May 1, 2006, June 19, 2006 and November 16,
2006.
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We
also
incorporate by reference into this prospectus supplement and accompanying
prospectus additional documents that we may file with the SEC under Section
13(a), 13(c), 14 or 15(d) of the Exchange Act until completion of this offering
(other than any portion of these documents that is furnished or otherwise deemed
not to be filed). These documents may include annual reports on Form 10-K,
quarterly reports on Form 10-Q and current reports on Form 8-K, as well as
proxy
statements.
You
may
obtain copies of any of these filings through Capital Lease Funding, Inc. as
described below, through the SEC or through the SEC’s Internet website as
described above. Documents incorporated by reference are available on our
website at http://www.caplease.com
and
without charge by requesting them from us in writing or by telephone
at:
Capital
Lease Funding, Inc.
1065
Avenue of the Americas
New
York,
New York 10018
Attn:
Investor Relations
(212)
217-6393
23
CAPITAL
LEASE FUNDING, INC.
5,000,000
Shares
Common
Stock
offered
to stockholders
and
other interested investors
solely
in connection with the
DIVIDEND
REINVESTMENT
AND
STOCK PURCHASE PLAN
PROSPECTUS
February
8, 2007