SRC Spirit Realty Capital Inc

				2727 North Harwood Street Suite 300 Dallas, TX 75201 March 23, 2023

Dear Fellow Shareholders,

Thank you for your confidence in Spirit. We present this year’s Proxy Statement and invite you to our 2023 Annual Meeting of Shareholders on May 3, 2023 at 8:30 a.m. Central Time to be held at our headquarters located at 2727 N. Harwood Street, Suite 300, Dallas, TX 75201. You may attend in person or by proxy.

Outlined below are some of our significant efforts and achievements in 2022:

Superior Financial Results

Acquired $1.4 billion in real estate assets across 172 high-quality properties and invested $113.8M in revenue producing expenditures, with a weighted average initial capitalization rate of 6.65%

Generated $323.7 million in gross proceeds from the disposition of 60 properties, including 42 occupied properties with a weighted average disposition capitalization rate of 5.47% for the occupied properties

Continued accessing the capital markets, including generating net proceeds of $595.5 million from the issuance of shares of common stock, closing on a $1.2 billion multicurrency unsecured revolving credit facility, and entering into $1.3 billion in term loans

Environmental, Social and Governance Highlights

Released our first annual ESG Report aligned with the Sustainability Accounting Standards Board (“SASB”) and Task Force on Climate-Related Financial Disclosures (“TCFD”)

Winner of Nareit’s 2022 Diversity, Equity & Inclusion Silver Award

Named a 2022 DFW Top Place to Work by the Dallas Morning News

Named a 2022 Green Lease Leader, Silver by the Institute for Market Transformation and the Department of Energy’s Better Building Alliance

Board and Committee oversight of ESG-matters, as shown in the ESG Oversight chart on page 10 of the Proxy Statement.

Continued focus on diversity and refreshment of our Board. Our 2023 Board nominee slate is 44% female.

On behalf of the Board of Directors, we thank you for your commitment to Spirit and ask for your support on the matters described in this Proxy Statement so that we can continue to produce positive results and increase long-term shareholder wealth going forward.

NOTICE OF 2023 ANNUAL MEETING OF SHAREHOLDERS

IMPORTANT NOTICE REGARDING INTERNET AVAILABILITY OF PROXY MATERIALS FOR THE ANNUAL MEETING TO BE HELD ON MAY 3, 2023: This Proxy Statement, our Annual Report on Form 10-K for the fiscal year ended December 31, 2022 and our Annual Report to Shareholders for the fiscal year ended December 31, 2022 are available at www.proxydocs.com/SRC. More information regarding proxy voting, proxy materials, and attending the annual meeting can be found in the “Questions and Answers” section of the Proxy Statement.

By Order of our Board of Directors,

Rochelle Thomas,

Executive Vice President,

General Counsel and Secretary

TABLE OF CONTENTS

ANNUAL MEETING INFORMATION

2023 ANNUAL MEETING OF SHAREHOLDERS

This Proxy Statement is being furnished in connection with the solicitation by the Board of Directors (the “Board”) of Spirit Realty Capital, Inc., a Maryland corporation and its affiliates (“Spirit,” “we,” “us” or the “Company”), of proxies to be exercised at the 2023 Annual Meeting of Shareholders (the “Annual Meeting”) and at any postponement(s) or adjournment(s) thereof.

Beneficial Owners

If you own shares registered in the name of a broker or other custodian (a “beneficial owner”), follow the instructions provided by your broker or custodian on how to vote your shares. If you want to vote your shares at the Annual Meeting, you must obtain a legal proxy from your broker or other custodian to bring with you to the Annual Meeting to demonstrate your authority to vote. If you do not instruct your broker or custodian how to vote, such broker or custodian will have discretionary authority, under current New York Stock Exchange (“NYSE”) rules, to vote your shares in its discretion on the ratification of the selection of Ernst & Young LLP as our independent registered public accounting firm for fiscal year ending December 31, 2023 (Proposal 2). However, your broker or custodian will not have discretionary authority to vote on the election of directors (Proposal 1) or the advisory vote to approve our executive compensation (Proposal 3) without instructions from you. As a result, if you do not provide instructions to your broker or custodian, your shares will not be voted on Proposal 1 or Proposal 3.

ANNUAL MEETING INFORMATION

Votes by Proxy

All shares that have been properly voted by proxy and not revoked will be voted at the Annual Meeting in accordance with the instructions contained in the proxy. Shares represented by proxy cards that are signed and returned but do not contain any voting instructions will be voted consistent with the Board’s recommendations.

EXPENSES AND SOLICITATION

Spirit will bear the expense of soliciting proxies by the Board of Directors. Proxies may be solicited in person, by telephone or e-mail, by directors, officers or employees of Spirit, who will receive no additional compensation for soliciting proxies. We will also reimburse brokers and other nominees for their expenses incurred in distributing proxy materials to beneficial owners of our shares.

PROXY SUMMARY

This summary highlights selected information that is provided in more detail throughout the Proxy Statement. Please read the entire Proxy Statement before casting your vote. Note that certain financial measures contained within this Proxy Statement (AFFO Per Share, Annualized Adjusted EBITDAre, and Adjusted Debt to Annualized Adjusted EBITDAre) are not calculated according to U.S. generally accepted accounting principles (“GAAP”). Please see Annex A for a reconciliation of these non-GAAP measures.

2022 BUSINESS HIGHLIGHTS

Spirit is a real estate investment trust (“REIT”) which primarily invests in single-tenant, operationally essential real estate assets throughout the United States, which are leased on a long-term triple-net basis to high-quality tenants with operations in retail, industrial, and certain other industries. Our operating strategy is to provide our shareholders with predictable earnings and dividend growth. We are proud of our accomplishments over the past year:

2022 COMPENSATION HIGHLIGHTS

Commitment to Pay-for-Performance

In 2022, 100% of our Named Executive Officers’ (defined herein) annual long-term incentive plan (“LTIP”) equity awards were tied to performance. The following graphs show the emphasis we placed on variable at-risk pay elements, such as performance-based cash bonuses and equity awards, for all of our Named Executive Officers in 2022.

2022 ENVIRONMENTAL, SOCIAL AND GOVERNANCE HIGHLIGHTS

At Spirit, we believe implementing environmental, social and governance (ESG) practices throughout our operations will drive long term value for our shareholders. Our Nominating and Corporate Governance Committee has key responsibility for ESG oversight and making ESG-related recommendations to the full Board.

Our current Board is composed of directors who collectively have what we believe is the right mix of skills, professional experience and expertise to effectively oversee management. Specifically, our directors have backgrounds in finance, M&A, real estate, risk oversight, and stakeholder value initiatives, among other skills relevant to Spirit’s strategic goals.

CORPORATE GOVERNANCE

The roles of Chairman of the Board and Chief Executive Officer have been separated since May 2017. This leadership structure gives primary responsibility for the operational leadership and strategic direction of the Company to our Chief Executive Officer, while the Chairman of the Board facilitates our Board’s independent oversight of management and promotes communication between management and our Board. Richard Gilchrist serves as Lead Independent Director and Chairman of the Board.

ESG OVERSIGHT

Our ESG efforts are ultimately overseen by our Board and committees thereof. Our Nominating and Corporate Governance Committee has key responsibility for ESG oversight and making ESG-related recommendations to the full Board. Our Audit and Compensation Committees also oversee ESG-related responsibilities specific to their committee scope. We have also established several committees that meet regularly and report to Spirit’s Executive Leadership Team (“ELT”), which report to our Board. Members of Spirit’s senior management sit on most of the internal ESG committees to remain informed, as well as to be involved in decision-making. The chart below outlines the flow of ESG reporting within our organization:

Board Diversity

Spirit strongly believes that diversity is an important factor in board effectiveness. This diversity – across gender, tenure, age, race/ethnicity, and experience – brings with it a diversity of ideas and perspectives that support the Board’s role in overseeing the Company’s ongoing strategic objectives.

Our 2023 Director nominee composition reflects this focus on diversity. We have four female directors (Diana Laing, Elizabeth Frank, Michelle Frymire and Kristian Gathright) and one racially/ethnically diverse director (Jackson Hsieh).

Independence

NYSE listing standards require NYSE-listed companies to have a majority of independent board members and an audit committee, compensation committee and nominating and corporate governance committee, each composed solely of independent directors. Under the NYSE listing standards, in addition to other factors, no director of a company qualifies as “independent” unless the board of directors of such company affirmatively determines that the director has no material relationship with such company (either directly, or indirectly as a partner, shareholder or officer of an organization that has a relationship with such company).

CORPORATE GOVERNANCE

At least annually, the Nominating and Corporate Governance Committee evaluates the independence of each director on a case-by-case basis by considering any matters that could affect his or her ability to exercise independent judgment in carrying out the responsibilities of a director. Any such matters are evaluated from the standpoint of the director and the persons or organizations with which the director has an affiliation. Each director abstains from participating in the determination of his or her independence.

Based on its most recent review, the Board has affirmatively determined that, based on the standards set forth in the NYSE rules and our corporate governance documents, each of the director nominees qualifies as “independent” under the NYSE listing standards (except for Jackson Hsieh due to his employment as our Chief Executive Officer and President.)

Board Engagement and Attendance

In effectuating the Board’s guidance and oversight role, our Board held a total of seven meetings during 2022. Evidencing a strong commitment to the Company, the majority of directors attended 100% of the Board meetings held in 2022 that occurred while they were serving as a Director, with each Director attending at least 91% of the total meetings of the Board and all committees on which she or he served during the time of service.

Our independent directors regularly meet in executive sessions, outside the presence of management – generally, at each regularly scheduled quarterly Board and Committee meeting and at other times as necessary or desirable. The Lead Independent Director chairs all regularly scheduled executive sessions of the Board and all other meetings of the independent directors.

We strongly encourage, but do not require, Directors to attend our annual meetings of shareholders. We had full attendance by our Board members at the 2022 annual meeting. We have scheduled the Annual Meeting at a time and date to permit attendance by Directors and intend to make every effort to do so for future annual meetings of the shareholders, taking into account the directors’ schedules and the timing requirements of applicable law.

Annual Board Assessment Process

The Board recognizes that a comprehensive and constructive evaluation process is critical to our Board’s ongoing effectiveness and a key component of good corporate governance. In 2022, we performed assessments using a thorough evaluation process that has been developed over the years. Our robust annual review involves assessing our full Board and our committees, with a focus on numerous areas – composition, structure, competencies, processes and policies, and behaviors. The evaluation process is also used to consider Board succession planning and refreshment.

Board Composition and Refreshment

The Nominating and Corporate Governance Committee performs an annual assessment of the skills and experience needed to properly oversee the interests of the Company and recommends to the Board for nomination such candidates that meet these qualifications.

The Nominating and Corporate Governance Committee also considers diversity as an important factor in determining composition of the Board. Over the past few years our active refreshment process has led to the appointment of Diana Laing, Elizabeth Frank, Michelle Frymire, Kristian Gathright and Thomas Sullivan, each of whom offer differentiated perspectives and diversity to the Board. Currently, 44% of our Board is female. Furthermore, there is significant diversity in the length of service amongst our Board members, with tenures ranging from fourteen years to two years. Such diversity illustrates that Spirit values both new perspectives and the deep institutional knowledge of longer-tenured directors.

The Nominating and Corporate Governance Committee also oversees our comprehensive onboarding program for new directors which includes a combination of written materials, oral presentations and meetings in which the new members receive detailed information about Spirit’s history, culture, risk framework, ethics, investment strategy and other policies that are applicable to directors, as well as Spirit’s approach to human capital management, diversity and inclusion, environmental concerns and other social issues.

Director Stock Ownership Guidelines

The purpose of the stock ownership guidelines is to align the interests and actions of non-employee directors with the long-term interests of shareholders, and further promote our commitment to sound corporate governance. The guidelines require each non-employee director to hold shares equal in value to five times the annual Board retainer paid to such non-employee director (excluding any additional retainers paid for service on or chairing a committee or as chairperson of the Board). Directors who were appointed within the preceding three years of the date of the new stock ownership guidelines, or appointed thereafter, have a five-year grace period to meet the requirements.

CORPORATE GOVERNANCE

Board Governance Documents

The Board has adopted a written set of Corporate Governance Guidelines, as well as a Code of Business Conduct and Ethics that applies to the Company’s employees, officers and directors, including our Chief Executive Officer and Chief Financial Officer. To view our Corporate Governance Guidelines, Code of Business Conduct and Ethics, Human Rights Policy, Anti-Corruption Policy, and Whistleblower Policy, please visit the Corporate Governance section of our website at www.spiritrealty.com. Each of these governing documents is also available, free of charge, in print to any shareholder who sends a written request to such effect to Investor Relations, Attention: Investor Relations, Spirit Realty Capital, Inc., 2727 North Harwood Street, Suite 300, Dallas, TX 75201.

How to Communicate with Directors

Shareholders and other parties interested in communicating directly with our Board or any director on Board-related issues may do so by writing to Board of Directors, c/o Investor Relations, Attention: Investor Relations, Spirit Realty Capital, Inc., 2727 North Harwood Street, Suite 300, Dallas, TX 75201, or by submitting an email to directors@spiritrealty.com. Additionally, shareholders and other parties interested in communicating directly with the Lead Independent Director of the Board or with the independent directors as a group may do so by writing to Lead Independent Director, c/o Investor Relations, Attention: Investor Relations, Spirit Realty Capital, Inc., 2727 North Harwood Street, Suite 300, Dallas, TX 75201, or by sending an e-mail to directors@spiritrealty.com. Communications addressed to the Board or individual members of the Board are screened internally for appropriateness before distributing to the Board, or to any individual director or directors, as applicable.

BOARD COMMITTEES

Our Board has three primary standing committees that perform certain delegated functions for the Board: the Audit Committee, the Compensation Committee, and the Nominating and Corporate Governance Committee. Each committee operates pursuant to a written charter that is available in the Corporate Governance section of our website at www.spiritrealty.com or available, free of charge, upon request directed to Investor Relations, Attention: Investor Relations, Spirit Realty Capital, Inc., 2727 North Harwood Street, Suite 300, Dallas, TX 75201, or by submitting an email to InvestorRelations@spiritrealty.com.

Additionally, our Board has a Board Investment Committee which consists of, at minimum, three independent directors and is responsible for the review and approval of certain real estate acquisitions. The members of the Board Investment Committee are appointed by the Board and may be removed by the Board at any time, with or without cause. In 2020, the Board appointed Richard Gilchrist, Kevin Charlton, and Diana Laing to serve as members of the Board Investment Committee. These members continued to serve in 2022.

The Board committees met 16 times in the aggregate during 2022, with a majority of the committee members from the Audit Committee, Compensation Committee and Nominating and Corporate Governance Committee attending 100% of the meetings which occurred while they were a director and member of the applicable committee. The table below provides 2022 membership and meeting information for each of our primary Board committees.

The Company’s management is responsible for establishing and maintaining accounting policies and procedures in accordance with U.S. generally accepted accounting principles (“GAAP”) and other applicable reporting and disclosure standards and for preparing the Company’s financial statements. The Company’s independent registered public accounting firm is responsible for performing audits of the Company’s annual consolidated financial statements and internal controls over financial reporting, and for issuing reports and expressing opinions thereon. The Audit Committee is responsible for the pre-approval of audit and non-audit services performed by the Company’s independent registered public accounting firm. The Company’s internal audit firm is responsible for preparing and executing an annual internal audit plan and for SOX compliance, all of which is reported directly to the Audit Committee on a regular basis.

The Audit Committee maintains free and open communication with the Board, our independent registered public accounting firm, our internal auditor and our financial and accounting management teams. The Audit Committee regularly meets separately in executive session, outside the presence of management, with our independent registered public accounting firm and our internal auditor – generally, at each regularly scheduled meeting and at other times as necessary or desirable. Our Board has adopted procedures for reporting concerns under our Code of Business Conduct and Ethics and other Company policies, including complaints regarding accounting and auditing matters in accordance with Rule 10A-3 under the Exchange Act.

Members and the Chair of the Audit Committee are appointed annually by the Board and may be removed from the Committee by the Board in its discretion at any time. The Board has determined that all members of the Audit Committee are independent and have sufficient accounting and financial experience and ability to enable them to discharge their responsibilities pursuant to NYSE listing standards. Furthermore, the Board has determined that Diana Laing and Michelle Frymire are audit committee financial experts as defined by the SEC.

The Nominating and Corporate Governance Committee regularly meets separately in executive session, outside the presence of management – generally at each regularly scheduled meeting and at other times as necessary or desirable. Members and the Chair of the Nominating and Corporate Governance Committee are appointed annually by the Board and may be removed from the Committee by the Board at any time in its discretion. The Board has determined that all members of the Nominating and Corporate Governance Committee are independent pursuant to NYSE listing standards.

QUALIFICATIONS OF DIRECTOR NOMINEES

The Nominating and Corporate Governance Committee performs an annual assessment of the skills and experience needed to properly oversee the interests of the Company and recommends to the Board for nomination such candidates that meet these qualifications. When identifying and recommending director candidates to the Board, the Nominating and Corporate Governance Committee may consider criteria or qualifications that it deems appropriate, including, but not limited to: personal and professional ethics, integrity and values; understanding and experience in the Company’s industry; other public or private board service (including potential impact to the Board and Company of a candidate’s service on other boards of directors and the number of other boards of publicly traded companies on which the candidate currently serves); professional background and experience, including ESG related experience; and impact on diversity of background, skills, gender, race, ethnicity and experience of the Board.

PROCESS FOR CONSIDERING DIRECTOR NOMINEES

The Nominating and Corporate Governance Committee meets annually, at a minimum, to evaluate the Board and Committee self-assessments, as well as the performance of each current director. The Nominating and Corporate Governance Committee considers the results of such assessments and evaluations, diversity of the Board, as well as the collective mix of skills and experience necessary to properly oversee the interests of the Company for the following year, when determining whether to recommend the nomination of each director for an additional term.

At an appropriate time prior to each annual meeting at which directors are to be elected or re-elected, the Nominating and Corporate Governance Committee recommends to the Board for nomination by the Board, such candidates as the Nominating and Corporate Governance Committee, in its judgment, has found to be well qualified and willing and available to serve. At an appropriate time after a vacancy arises on the Board or a director advises the Board of his or her intention to resign, the Nominating and Corporate Governance Committee shall recommend to the Board for election by the Board to fill such vacancy, such prospective member of the Board as the Nominating and Corporate Governance Committee, in the exercise of its judgment, has found to be well qualified, willing and available to serve, and possessing the skills and experience desirable to complement the other Board members to effectively oversee the interests of the Company and its shareholders. In determining whether a prospective member is qualified to serve and appropriate for Board membership, the Nominating and Corporate Governance Committee will consider the information listed under “Nominees’ Skills, Experience and Qualifications.”

NOMINATING AND CORPORATE GOVERNANCE COMMITTEE

SHAREHOLDER RECOMMENDED DIRECTOR NOMINEES

We did not receive any shareholder recommendations for director candidates for election at the 2023 Annual Meeting in compliance with the procedures set forth below. However, if we do receive shareholder recommendations for director election, the Nominating and Corporate Governance Committee’s current process is to review and consider any candidate who has been recommended by shareholders in compliance with the procedures established from time to time by the Nominating and Corporate Governance Committee. However, the Nominating and Corporate Governance Committee will not consider any director candidate if the candidate’s candidacy or, if elected, Board membership would violate controlling state law or federal law.

All shareholder recommendations for director candidates to be considered at the annual meeting of shareholders in 2024 must be submitted on or before November 24, 2023 to Investor Relations, Attention: Secretary, Spirit Realty Capital, Inc., 2727 North Harwood Street, Suite 300, Dallas, TX 75201, who will forward all recommendations to the Nominating and Corporate Governance Committee, and must include the following information: (a) the name and address of record of the shareholder; (b) representation that the shareholder is a record holder of our common stock or, if not a record holder, evidence of ownership in accordance with Rule 14a-8(b)(2) under the Securities Exchange Act of 1934; (c) name, age, business and residential address, educational background, current principal occupation or employment, and principal occupation or employment for the preceding five full fiscal years of the proposed director candidate; (d) description of the qualifications and background of the proposed director candidate which addresses the items under “Nominees’ Skills, Experience and Qualifications,” as well as any minimum qualifications and other criteria for Board membership as may be approved by the Board from time to time; (e) description of all arrangements or understandings between the shareholder and the proposed director candidate; (f) consent of the proposed director candidate (1) to be named in the proxy statement relating to our annual meeting of shareholders and (2) to serve as a director if elected at such annual meeting; and (g) any other information regarding the proposed director candidate that is required to be included in a proxy statement filed pursuant to the rules of the SEC. In addition to satisfying the foregoing requirements under our Bylaws, to comply with the universal proxy rules, shareholders who intend to solicit proxies in support of director nominees other than the Company’s nominees must provide notice that sets forth the information required by Rule 14a-19 under the Exchange Act.

COMPENSATION COMMITTEE

Chair         Thomas Sullivan                 Members    Kevin Charlton    Richard Gilchrist    Nicholas Shepherd    

Roles and Responsibilities

The purpose of the Compensation Committee is to carry out the Board’s responsibilities related to compensation plans, policies and programs for the Company’s executive officers and non-employee directors, as well as any compensation program that delivers Company equity to participants as further described in the Compensation Committee charter. The Compensation Committee meets during the first quarter of each year to review the achievement of pre-established performance metrics for the prior year to determine the appropriate annual and long-term incentive awards for our executive officers based on that prior-year performance and to approve grants of equity awards to our executive officers.

Furthermore, the Compensation Committee has primary responsibility for:

For 2022, the Compensation Committee elected to continue utilizing the services of Ferguson Partners Consulting (“FPC”), an independent third-party compensation consultant, to assist with the review and evaluation of our executive compensation program to ensure its continued close alignment with our compensation philosophy and business strategy. FPC also provided assistance to the Compensation Committee in reviewing market data on compensation, understanding industry executive compensation trends, and determining and managing risks associated with elements of our executive compensation program. Ferguson Partners L.P., an affiliate of FPC, provided leadership development services to the Company in 2022. Such services did not exceed $120,000 for fiscal year 2022. The Compensation Committee reviewed FPC’s independence under Rule 10C-1 of the Exchange Act and NYSE listing standards and determined that there is no conflict of interest resulting from retaining FPC.

Our senior management team provides support to the Compensation Committee by coordinating meeting logistics, preparing and disseminating relevant financial and non-financial Company information and relevant data concerning our peer competitors as a supplement to the comparative market data prepared by FPC, and making recommendations with respect to performance metrics and related goals. Our Chief Executive Officer attends meetings at the Compensation Committee’s request and recommends compensation changes affecting the other members of our senior management team. However, our Chief Executive Officer plays no role in setting his own compensation. The Compensation Committee regularly meets separately in executive session, outside the presence of management – generally, at each regularly scheduled meeting and at other times as necessary or desirable.

Members and the Chair of the Compensation Committee are appointed annually by the Board and may be removed from the Compensation Committee by the Board at any time in its discretion. The Nominating and Corporate Governance Committee has determined that all members of the Compensation Committee are independent pursuant to NYSE listing standards and qualify as “non-employee” directors under Rule 16b-3 of the Exchange Act.

ADDITIONAL CORPORATE GOVERNANCE MATTERS

BOARD’S ROLE IN RISK OVERSIGHT

While management has primary responsibility for identifying and managing our exposure to risk, our Board plays an active role in overseeing the processes we establish to assess, monitor and mitigate that exposure. The Board, directly and indirectly through its committees, routinely discusses with management our significant enterprise risks and reviews the guidelines, policies and procedures we have in place to address those risks. Our Audit Committee specifically is tasked with oversight of the Company’s risk assessment and mitigation strategy, including oversight of the Company’s enterprise risk management assessment, which it reviews on a quarterly basis.

The Board also has an evaluation and approval role as to certain significant real estate acquisitions meeting thresholds defined in our Board Investment Approval Policy. The Board Investment Committee, consisting solely of independent members, assists the Board in discharging its responsibilities as to the review and approval of certain real estate acquisitions.

Our Board believes that the process it has established to administer the Board’s risk oversight function would be effective under a variety of leadership frameworks and, therefore, does not have a material effect on our choice of the Board’s leadership structure described above under “Corporate Governance—Board of Directors—Leadership Structure.”

HEDGING AND PLEDGING

We maintain a Hedging and Risk Management Policy to ensure compliance with applicable laws including the Dodd-Frank Wall Street Reform and Consumer Protection Act and the Commodity Exchange Act, and establish guidelines for the Company’s use of derivatives for hedging purposes.

PUBLIC POLICY MATTERS

We are committed to ethical business conduct and expect our directors, officers and employees to act with integrity and conduct themselves, and our business, in a way that protects our reputation for fairness and honesty. Consistent with these principles and our Code of Business Conduct and Ethics, we have established policies and practices with respect to political contributions and other public policy matters that can be found on our website at www.spiritrealty.com.

RELATED PARTY TRANSACTIONS

TRANSACTIONS WITH RELATED PERSONS

Our Board has adopted a Related Party Transaction Policy for transactions between us and any of our officers, directors or their affiliates, greater than 5% beneficial owners of the Company’s common stock, and each of their immediate family members where the amount involved in the transaction exceeds or is expected to exceed $120,000 and the related party has or will have a direct or indirect material interest. Any such transaction must be reviewed and approved or ratified by the Audit Committee.

INDEMNIFICATION OF DIRECTORS AND OFFICERS

We have entered into indemnification agreements with each of our directors and Named Executive Officers.

SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE

Section 16(a) of the Exchange Act requires the Company’s officers and directors, and persons who own more than 10% of any registered class of the Company’s equity securities (collectively, “Insiders”), to file with the SEC initial reports of ownership and reports of changes in ownership of the Company’s common stock and other equity securities of the Company. Insiders are required by regulation of the SEC to furnish the Company with copies of all Section 16(a) forms they file. To the Company’s knowledge, based solely on a review of the copies of the Section 16(a) reports furnished to the Company by the Insiders or written representations from the Insiders that no other reports were required with respect to the year ended December 31, 2022, all Insiders timely filed all Section 16(a) reports required to be filed by them for 2022 with the exception of an untimely filing of a Form 4 for Mr. Prakash Parag, the Company’s Chief Accounting Officer, reporting a grant of restricted stock.

RELATED PARTY TRANSACTIONS

SOCIAL AND ENVIRONMENTAL RESPONSIBILITY

At Spirit, we believe that doing the right thing for our employees, community, and environment leads to better results for our stakeholders and company as a whole. With the full support and oversight of our Board, we have implemented social and environmental practices and policies throughout the operation of our business, thereby demonstrating our focus on being responsible and conscientious in everything that we do as we strive to drive long-term stakeholder value and make the communities in which we operate a better place to live and work. We have documented our social and environmental initiatives in our ESG Report, Corporate Responsibility pages of our website, Environmental Management System, DEI Policy, Anti-Corruption Policy, Human Rights Policy and our Code of Business Conduct and Ethics, each of which can be accessed on our website at www.spiritrealty.com. Neither the website nor its contents (including the reports, pages, policies and other documents referenced here) are incorporated by reference in this Proxy Statement.

ESG OVERSIGHT

Our ESG efforts are overseen by our Board, and specifically our Nominating and Corporate Governance Committee. We have formed several internal working committees that focus on the design and implementation of our ESG initiatives. These committees report to our ELT, who then report to the Nominating and Corporate Governance Committee and Board on a regular-basis throughout the year, including how the Company is tracking with respect to various ESG goals and initiatives. Our ESG Oversight chart depicting this reporting structure is on page 10 in our Corporate Governance section of our Proxy.

DIVERSITY AND INCLUSION

Diversity and Inclusion – At Spirit, we are all different, we are all valued, and we are “All One Team.” We believe a diverse and inclusive workforce, and a culture that respects and appreciates diversity of experience, idea and opinion is important to our success. In line with Company policy, we strive to promote diversity and inclusion in many ways:

We believe we have a diverse employee population: As of December 31, 2022, 51% of our employees were female and 30% of our employees were from racial or ethnic minority groups.

SOCIAL AND ENVIRONMENTAL RESPONSIBILITY

Diversity, Equity & Inclusion Policy

Our efforts in the diversity and inclusion space are formalized in our Diversity, Equity & Inclusion Policy. In this policy, we define what Diversity, Equity and Inclusion means to Spirit and state our commitment to employees, our community, our tenants, and our shareholders.

SOCIAL AND ENVIRONMENTAL RESPONSIBILITY

SOCIAL AND ENVIRONMENTAL RESPONSIBILITY

HUMAN CAPITAL MANAGEMENT

Attractive Compensation and Benefits – Spirit strives to award our employees compensation and benefits that are in line or better than those of our peers and competitors, including:

Mental and Physical Well-Being – We believe the mental and physical well-being of our employees is an important piece of our business and overall success. Spirit supports its employees’ health and wellness by offering the following:

Social Engagement – Spirit has a passion for fostering a social, collaborative and engaged workforce. We firmly believe that regular social and team building events for our employees encourage socialization, collaboration, and relationship building among our Spirit family – all things that we believe are vital for employee engagement. One example of our passion for a social and engaged workforce is the social and volunteer programming created by our Spirit One Committee.

Recognition – Recognition of our employees’ accomplishments and hard work is a key component of our talent engagement strategy. We actively promote the recognition of our employees, including presenting a “game ball” to one employee or group of employees at each monthly “Town Hall” meeting to recognize their efforts on a particular project or transaction.

Development and Training – We aim to attract the best and brightest talent in the industry and retain them through a culture of collaboration and mutual respect. We will continue to maintain high standards of excellence and expect the best of ourselves and our colleagues as we work to achieve our shared goals. We strive to offer various resources and training to our employees to better position them for success, such as:

COMMUNITY OUTREACH

Spirit aims to be a good corporate citizen by supporting charitable organizations and by encouraging our employees to personally participate in volunteer activities. Spirit is also committed to supporting and encouraging its employees’ contributions to charitable organizations outside of company organized service projects. To assist our employees with charitable giving and augment the impact of their charitable dollars, Spirit has an Employee Gift Matching Program. Under the Employee Gift Matching Program, Spirit matches, up to a certain dollar amount per employee, charitable contributions made by our employees to eligible organizations.

In 2022, Spirit donated over $166,000 through corporate donations and employee gift matching:

SOCIAL AND ENVIRONMENTAL RESPONSIBILITY

SOCIAL AND ENVIRONMENTAL RESPONSIBILITY

ENVIRONMENTAL SUSTAINABILITY

With fewer than 100 employees and overseeing a portfolio of properties where the day-to-day management is controlled by tenants, our direct environmental footprint is smaller than REITs that operate their properties, but sustainability is still embedded in our culture. Spirit recognizes that the ownership of commercial real estate can have a significant impact on the environment. We have an Environmental Management System (EMS) that formalizes our company policy of implementing environmental practices at our headquarters and throughout our business. Our EMS outlines Board and Committee oversight of ESG matters, our various environmentally focused internal committees, our “Plan-Do-Check-Act” cycle, the sustainable activities within our portfolio and at our Company headquarters and how we approach environmental risk mitigation.

Environmental Focus of Tenants

As a net-lease real estate investment trust, we invest predominantly in single tenant real estate under absolute net-leases. Thus, Spirit’s tenants are generally responsible for maintaining the leased premises, including controlling their energy usage and implementation of environmentally sustainable practices at each location. While this dynamic does not give us direct control over these sustainability efforts at the properties, we aim to partner with our tenants to collaborate on environmental sustainability opportunities.

For example, in 2022 Spirit conveyed an easement which allowed South Portland Land Trust to construct and maintain a trail in a recreational area that provides the community with a safe way to walk to various businesses in the community and enjoy Clark’s Pond Trail. Spirit was not compensated and covered all legal fees for South Portland Land Trust to accomplish this.

SOCIAL AND ENVIRONMENTAL RESPONSIBILITY

Our Top Tenants Are Making Public Commitments to Sustainability¹

SOCIAL AND ENVIRONMENTAL RESPONSIBILITY

Sustainability and Environmental Risk Management Initiatives

SOCIAL AND ENVIRONMENTAL RESPONSIBILITY

Activities at our Headquarters

Environmental Focus Throughout the Community

SOCIAL AND ENVIRONMENTAL RESPONSIBILITY

Approach to Climate Change

Spirit recognizes that climate change is a global and evolving challenge. Accordingly in 2022, Spirit issued its first ESG Report aligned with the Sustainability Accounting Standards Board (SASB) real estate industry standard and Task Force on Climate-related Financial Disclosures (TCFD) framework.

Climate Strategy

At Spirit, we are focused on identifying potential climate-related risks and subsequent opportunities for mitigation, and we considered climate-related matters in this year’s Enterprise Risk Management assessment. Our ESG Task Force is tasked with evaluating the various climate-related risks and opportunities we face and reporting any findings to the ELT, which then reports to our Nominating and Corporate Governance Committee who holds ultimate climate-related oversight. Going forward, a crucial element of our climate strategy will include tenant engagement and green lease clauses, where possible, to encourage our tenants to become more sustainable through their operations and look for partnership synergies.

Risk Management

Risk management is a priority at Spirit and critical to how we conduct our operations. Identifying and discussing potential risks informs our strategy and priorities as we look towards the future. As part of that focus and as mentioned above, Spirit conducts an Enterprise Risk Management assessment to identify and address which risks internal stakeholders deem material to the business. The results of that assessment help us to determine how those risks should be prioritized and accounted for in our strategy.

COMPENSATION DISCUSSION AND ANALYSIS

COMPENSATION DISCUSSION AND ANALYSIS

Highlights for the year ended December 31, 2022 include:

2022 COMPENSATION PROGRAM HIGHLIGHTS

 

In 2022, the portion of our NEOs’ annual LTIP equity grants tied to performance was 100%

Included an ESG-related goal for determining bonus attainment in connection with each NEO’s individual performance goals

Undertook a fresh evaluation of our peer group for 2022 compensation to ensure alignment of our 2022 programs with those of our peers

2022 Say-on-Pay Voting Results: 96.7% FOR

The Compensation Committee values the perspectives and concerns of our shareholders regarding executive compensation, and our Board has determined that an advisory vote to approve our executive compensation program will be submitted to our shareholders on an annual basis.

At our 2022 Annual Meeting of Shareholders, 96.7% of shares represented at the meeting and eligible to vote, cast votes FOR our executive compensation program.

COMPENSATION DISCUSSION AND ANALYSIS

2022 Shareholder Engagement Program

In 2022, we completed another successful Shareholder Engagement Program. We contacted each of our top ten shareholders as of September 30, 2022, representing 55.6% of outstanding shares at that time, and hosted calls with five of them. During these calls we addressed a handful of topics including our compensation program, ESG commitment, and corporate governance.

The Compensation Committee and the Board value the opinions of our shareholders and will continue to consider those opinions when making future executive compensation decisions that align compensation with the creation of value for our shareholders.

Compensation Philosophy and Objectives

Pay for Performance

Our compensation philosophy emphasizes pay-for-performance through an executive compensation program designed to align compensation with Company-wide financial and operational achievements. In 2022, 100% of long-term equity awards granted to our Named Executive Officers were performance based. In addition, 85% of our Named Executive Officers’ 2022 cash bonus opportunity was tied to key company performance measures.

Attract and Retain Talent

Our executive compensation philosophy also recognizes that, given that the market for experienced management is highly competitive, our ability to attract and retain the most highly-qualified executives to manage each of our business functions is critical.

Fundamentally, we believe executive officer compensation should be structured to provide competitive base salaries and benefits, which attract and retain superior executives. Additionally, we use annual performance-based cash compensation to motivate executive officers to attain financial, operational, individual and other goals that are consistent with increasing shareholder value.

Balanced Mix of Compensation, Weighted Towards Variable Pay Elements

The Compensation Committee believes that a balanced mix of compensation elements, significantly weighted towards variable at-risk pay elements, provides the intended alignment of executive compensation with the Company’s performance and shareholder interests. The structure also provides the necessary fixed and knowable minimum and short- and long-term incentive opportunities necessary to attract, motivate and retain talented and experienced executive officers.

The following graphs¹ show the emphasis we placed on variable at-risk pay elements, such as performance-based cash bonuses and LTIP equity awards, for all of our Named Executive Officers in 2022:

COMPENSATION DISCUSSION AND ANALYSIS

Commitment to Compensation Best Practices

We view the components of our executive compensation program as related but distinct, and we regularly reassess the total compensation of our Named Executive Officers to ensure that our overall compensation objectives are met. Our Compensation Committee meets frequently to address compensation matters and regularly reviews our executive compensation program to ensure that it provides competitive pay opportunities to help attract and retain highly-qualified and dedicated executive talent that is critical to our business.

In 2022, as part of its commitment to strong corporate governance and best practices, our Compensation Committee continued its engagement of FPC, which provided advice on the compensation program. Ferguson Partners L.P., an affiliate of FPC, also provided leadership development services to the Company in 2022.

COMPENSATION DETERMINATION

Roles of our Compensation Committee and Chief Executive Officer in Compensation Decisions: The Compensation Committee oversees our compensation program for all Named Executive Officers, subject, in the case of our Chief Executive Officer, to the Board’s approval.

Our Chief Executive Officer evaluates the individual performance and contributions of each other Executive Officer and reports to the Compensation Committee his recommendations regarding their compensation. Our Chief Executive Officer does not participate in any formal discussion with the Compensation Committee or the Board regarding decisions on his own compensation and recuses himself from meetings when his compensation is discussed. The Board or the Compensation Committee, as applicable, approves compensation for each of the Named Executive Officers.

We do not solely rely on formulaic guidelines to determine the mix or levels of cash and equity-based compensation, but rather maintain a flexible compensation program that allows us to adapt components and levels of compensation to motivate, reward and retain individual Named Executive Officers within the context of our desire to attain financial and operational objectives consistent with our strategic goals and shareholder interests. Subjective factors considered in compensation determinations include the Named Executive Officer’s responsibilities, leadership abilities, skills, contributions as a member of the executive

COMPENSATION DISCUSSION AND ANALYSIS

management team and to our overall performance, and whether the total compensation potential and structure is sufficient to ensure the retention of a Named Executive Officer when considering the compensation potential that may be available elsewhere.

Engagement of Compensation Consultants: For 2022, the Compensation Committee continued utilizing the services of FPC to provide assistance to the Compensation Committee in reviewing market data on compensation, understanding industry executive compensation trends, determining and managing risks associated with elements of our executive compensation program, and assisting with the Company’s incorporation of responses we received from our shareholders in connection with our shareholder engagement efforts.

Peer Group

In 2022, using the below methodology and best practices, the Compensation Committee, with input from FPC, analyzed the existing peer group as part of its annual review of executive and director compensation.

       —Who are our direct competitors?

       —Who might analysts compare Spirit to?

       —Who do we compete with for recruiting talent or where might our employees find employment elsewhere?

       —Who cites Spirit as a peer?

The peers in the compensation peer group were selected primarily on the basis of appropriate size (as defined by total capitalization), although operational activity (net lease and/or asset management intensive REITs) and the additional characteristics listed above also were considered. Additionally, the Compensation Committee also considered asset class and geography when selecting the peers. At the time compensation was being determined for 2022, Spirit ranked in the 62nd percentile by total capitalization as of January 31, 2022 as compared to the 2022 Compensation Peer Group.

Based on the peer analysis performed by FPC in 2021 for the purpose of selecting the 2022 Compensation Peer Group, RPT Realty and Washington Prime Group Inc. no longer met the recommended size parameters of 0.5x to 2.0x of the Company’s total capitalization and thus the Compensation Committee determined to remove each of these peers. In addition, Washington Prime Group Inc. filed for Chapter 11 bankruptcy and voluntarily delisted its shares of common stock.

The total capitalization as of January 31, 2022 of the 2022 Compensation Peer Group was as follows*:

COMPENSATION DISCUSSION AND ANALYSIS

The Compensation Committee, in consultation with FPC and the Board, also selected a performance peer group for purposes of assessing relative TSR performance under our LTIP performance share awards. This allows performance-based equity compensation to be measured against a more focused peer group that is more closely aligned to the Company’s business. For 2022 performance share awards, the performance peer group (the “Performance Peer Group”) consisted of:

Annual Performance Based Cash Incentive Compensation

We use cash bonuses to motivate our Named Executive Officers to achieve our short-term financial and strategic objectives, while making progress towards our longer-term growth and other goals. In February 2022, our Compensation Committee recommended, and our Board approved, the 2022 annual executive cash bonus program (“2022 Cash Bonus Program”), which ties our executives’ annual cash incentive awards closely to our financial performance, thereby aligning the interests of management with the interests of our shareholders. All of our Named Executive Officers were eligible to participate in the 2022 Cash Bonus Program.

Under the 2022 Cash Bonus Program, 85% of each executive’s cash bonus opportunity was based on the Company’s achievement of the following quantitative performance goals (i) Adjusted Debt to Annualized Adjusted EBITDAre (referred to herein as “Debt to EBITDA Leverage”); (ii) capital deployment (includes revenue producing expenditures and acquisitions made in accordance with the Company’s Investment Guidelines), and (iii) AFFO per share (collectively, the “2022 Key Performance Measures”). Accordingly, the portion of each executive officer’s cash bonus opportunity based on individual performance under the 2022 Cash Bonus Program was 15%. Each executive’s individual performance was evaluated based on the Compensation Committee’s assessment of individual performance against pre-determined performance goals and included an analysis of ESG-related accomplishments, with input from our Chief Executive Officer with respect to the other Named Executive Officers and from the Board with respect to our Chief Executive Officer (the “2022 Individual Bonus”).

Our Compensation Committee approved threshold, target and maximum bonus opportunities for each executive under the 2022 Cash Bonus Program, taking into consideration the degree of difficulty to achieve the targets, which are set forth below expressed as a percentage of each executive’s annual base salary:

The Company’s performance goals and actual results under the 2022 Cash Bonus Program as to the 2022 Key Performance Measures were as follows:

COMPENSATION DISCUSSION AND ANALYSIS

Why does this measure matter? Debt to EBITDA Leverage is a leverage metric used by equity and fixed-income investors and credit rating agencies to assess and compare balance sheet health, funding mix, and access to various capital sources. This metric is a key measure of creditworthiness and is a crucial component of Spirit’s investment grade rating. The Compensation Committee believed these goals were appropriately challenging due to the necessity to continue accessing capital markets in 2022 to achieve an attractive cost of capital and ensure appropriate levels of liquidity.

Result: Exceeded Maximum Performance. Our 2022 Debt to EBITDA Leverage was 5.2. The result was primarily due to the prudent actions of our Named Executive Officers, which led to $595.5 million in net equity proceeds from the issuance of common stock and $323.7 million in dispositions proceeds funding $1.5 billion in capital deployment.

Why does this measure matter? Effective capital deployment is an essential driver of REITs’ operational and financial performance. Disciplined capital allocation resulting in accretive acquisitions, funded through free cash flow, dispositions, and equity and debt issuance, generates improved earnings per share, dividends, and net asset value.

Result: Exceeded Maximum Performance. Our 2022 Capital Deployment was $1,547,282,000, all of which were real estate acquisitions and revenue producing expenditures. This exceptional result was primarily due to actions led by our Named Executive Officers, principally developing our sourcing effort from both acquisition and asset management teams and integrating processes and technology systems throughout the organization to efficiently source, underwrite, and close transactions.

Why does this measure matter? AFFO per share is a standard non-GAAP measure used by REIT analysts and investors to assess the Company’s operating performance. The goals were consistent with our general guidance. The Compensation Committee believed these goals were appropriately challenging to demonstrate year-over-year growth and encourage operational excellence through active portfolio management.

Result: Between Target and Maximum Performance. Our 2022 AFFO per share was $3.56. This result was mainly due to actions led by our Named Executive Officers, principally our accretive acquisitions, well-timed issuance of equity and debt, and very healthy operations reflected by less than 1% vacancy and improved performance on property leakage and tenant health driving higher net operating margins.

2022 Individual Bonus

Individual performance under management

objectives established for each Named Executive Officer

Weighting: 15%

Goals:

When determining the amounts paid pursuant to the 2022 Individual Bonus, the Compensation Committee considered the performance of each executive as it relates to: (i) the specific goals set forth below for each individual Named Executive Officer, (ii) actions taken that enhanced the Company’s environmental, social and governance initiatives, (iii) leadership, (iv) development and execution of overall business strategy, (v) risk management, and (vi) effective communications with the Board. The 2022 Individual Bonus is weighted as 15% of the 2022 Cash Bonus Program with 10% attributed to the achievement of individual goals and performance and 5% attributed to the setting and attainment of the company’s ESG related goals.

Below are the specific goals that were set for each Named Executive Officer as to determination of the 2022 Individual Bonus. Individual objectives relate to areas of special emphasis within the executive’s particular responsibilities and duties, such as achieving certain departmental and Company strategic, financial and operating goals, making other extraordinary or unusual contributions, and appropriately managing the Company’s risk.

Jackson Hsieh, President and Chief Executive Officer

COMPENSATION DISCUSSION AND ANALYSIS

Michael Hughes, EVP and Chief Financial Officer