0000877860FALSE00008778602022-09-082022-09-08
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of Earliest Reported): September 8, 2022 (September 1, 2022)
NATIONAL HEALTH INVESTORS INC
(Exact name of registrant as specified in its charter)
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| Maryland | | 001-10822 | | 62-1470956 |
(State or other jurisdiction
of incorporation) | | (Commission
File Number) | | (IRS Employer
Identification No.) |
222 Robert Rose Drive, Murfreesboro, TN 37129
(Address of principal executive offices)
(615) 890-9100
(Registrant's telephone number, including area code)
Not Applicable
(Former name, former address and former fiscal year,
if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
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| ☐ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
| ☐ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| ☐ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| ☐ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c) |
Securities registered pursuant to Section 12(b) of the Act:
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| Title of each Class | | Trading Symbol(s) | | Name of each exchange on which registered |
| Common Stock, $0.01 par value | | NHI | | New York Stock Exchange |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter). Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Item 1.01. Entry into Material Definitive Agreements.
Effective September 1, 2022, NHI entered into a 10th amendment (the “10th Amendment”) to the master lease dated October 17, 1991, as previously amended (the “Master Lease”) by and between NHI and NHC/OP, L.P., an affiliate of National Healthcare Corporation (“NHC”). The 10th Amendment was entered into in connection with the sale of seven skilled nursing facilities as described in Item 8.01 below and increases the annual base rent due each year through the expiration of the Master Lease on December 31, 2026. The annual base rent prior to the 10th Amendment was $30.75 million and was increased to $34.25 million for the year ended December 31, 2022, with credit given for rent paid under the 2013 Lease (as defined below) in 2022. In addition to the base rent, NHC will continue to pay any additional rent and percentage rent as required by the Master Lease which is estimated to be approximately $3.2 million for the year ended December 31, 2022.
The foregoing description is qualified in its entirety by the full text of the 10th Amendment, a copy of which is filed as exhibit 10.1 to this report on Form 8-K and is incorporated herein by reference.
Item 8.01. Other Events.
Effective September 1, 2022, NHI sold seven skilled nursing facilities in New Hampshire and Massachusetts to an unrelated third party for net cash proceeds of approximately $43.7 million. These properties were leased to NHC pursuant to a master lease agreement dated August 30, 2013 (the “2013 Lease”) with an original maturity date of August 31, 2028 that was terminated upon completion of the sale. These properties were previously classified as assets held for sale with a net book value of $30.1 million with rental income recognized totaling $1.8 million for the six months ended June 30, 2022.
Concurrently with the sale of these properties, NHI and NHC entered into the 10th Amendment to the Master Lease covering the remaining 35 properties leased to NHC as described in Item 1.01 above and incorporated herein by reference.
Item 9.01. Financial Statements and Exhibits.
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| Exhibit Index |
| Number | Exhibit |
| 10.1 | |
| 104 | Cover Page Interactive Data File (formatted as inline XBRL and contained in Exhibit 101). |
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
NATIONAL HEALTH INVESTORS, INC.
By: /s/ D. Eric Mendelsohn
Name: D. Eric Mendelsohn
Title: President and Chief Executive Officer
Date: September 8, 2022
AMENDMENT NO. 10 TO MASTER AGREEMENT TO LEASE
THIS AMENDMENT NO. 10 TO MASTER AGREEMENT TO LEASE (this “Amendment”) is made as of Sept. 1, 2022 (the “Amendment Execution Date”) by and between NATIONAL HEALTH INVESTORS, INC., a Maryland corporation (“Landlord”) and NHC/OP, L.P., a Delaware limited partnership (“Tenant”). Landlord and Tenant are collectively referred to herein as the “Parties” and individually as a “Party.”
RECITALS
WHEREAS, Landlord and Tenant are parties to that certain Master Agreement to Lease, dated October 17, 1991, as amended by that certain Amendment No. 1 to Master Agreement to Lease, dated June 2, 1993, as amended by that certain Amendment No. 2 to Master Agreement to Lease, dated January 15, 1996, as amended by that certain Amendment No. 3 to Master Agreement to Lease, dated July 22, 1997, as amended by that certain Amendment No. 4 to Master Agreement to Lease, dated December 31, 1997, as amended by that certain Amendment No. 5 to Master Agreement to Lease, dated December 27, 2005, as amended by that certain Amendment No. 6 to Master Agreement to Lease, dated December 26, 2012, as amended by that certain Amendment No. 7 to Master Agreement to Lease, dated August 28, 2013, as amended by that certain Amendment No. 8 to Master Agreement to Lease, dated October 30, 2020, and as amended by that certain Amendment No. 9 to Master Agreement to Lease, dated March 29, 2021 (collectively, as amended, the “Lease”), pursuant to which Landlord leases to Tenant, and Tenant leases from Landlord, various real properties more particularly described in the Lease.
WHEREAS, NHI-REIT of Northeast, LLC (“NHI-Northeast”), a Delaware limited liability company (an affiliate of Landlord), Tenant and National Healthcare Corporation (an affiliate of Tenant) (“NHC”) are parties to that certain Master Agreement to Lease, effective as of 12:01 a.m. on September 1, 2013 (the “New Hampshire/Massachusetts Lease”) pursuant to which Tenant and NHC lease from NHI-Northeast certain real property located in New Hampshire and Massachusetts which is more particularly described in the New Hampshire/Massachusetts Lease.
WHEREAS, as of the Amendment Execution Date, NHI-Northeast, Tenant and NHC have executed a Lease Termination Agreement pursuant to which the New Hampshire/Massachusetts Lease is being terminated.
WHEREAS, in consideration for the termination of the New Hampshire/Massachusetts Lease, Tenant has agreed to increase the Base Rent payable under the Lease and the Parties now desire to amend the Lease to memorialize such rent increase.
NOW, THEREFORE, in consideration of the mutual covenants herein contained and other good and valuable consideration, the mutual receipt and legal sufficiency of which are hereby acknowledged, the Parties hereby agree as follows:
1.Tenant. Landlord and Tenant acknowledge and agree that, notwithstanding anything contained in the Lease to the contrary, the “Tenant” under the Lease is and has been NHC/OP, L.P., a Delaware limited partnership, since that certain Amendment No. 7 to Master Agreement to Lease, dated August 28, 2013, as set forth therein. Any reference to NHC as the “Tenant” from and after the date of such Amendment No. 7 to Master Agreement to Lease, dated August 28, 2013, is hereby deemed corrected by this Amendment.
2.Third Renewal Term. Landlord and Tenant acknowledge and agree that the current term of the Lease is the Third Renewal Term, which commenced January 1, 2022 and will expire on December 31, 2026.
3. Base Rent. Section 2.01.01 of the Lease (as modified by Amendment No. 6 to Master Agreement to Lease, dated December 26, 2012) is generally amended to provide that Tenant shall pay to Landlord annual Base Rent in the following amounts during the Third Renewal Term:
| | | | | |
| Lease Year | Annual Base Rent |
| 01/01/2022 through 12/31/2022 | $34,250,000 |
| 01/01/2023 through 12/31/2023 | $34,075,000 |
| 01/01/2024 through 12/31/2024 | $32,625,000 |
| 01/01/2025 through 12/31/2025 | $32,225,000 |
| 01/01/2026 through 12/31/2026 | $31,975,000 |
Annual Base Rent shall be paid in equal monthly installments on the first day of each calendar month.
Taking into account that the annual Base Rent under the Lease is being increased retroactive to January 1, 2022, Tenant shall automatically be given a credit by Landlord against the annual Base Rent payable under the Lease during calendar year 2022 in the amount of any rent actually paid to NHI-Northeast by Tenant and/or NHC during calendar year 2022 under the New Hampshire/Massachusetts Lease.
Tenant shall continue to pay any Additional Rent (required under Section 2.02 of the Lease), Other Additional Rent (required under Section 2.02.02 of the Lease) and Percentage Rent (required under Section 2.06 of the Lease as modified by Amendment No. 5 to Master Agreement to Lease, dated December 27, 2005, and Amendment No. 6 to Master Agreement to Lease, dated December 26, 2012) throughout the term of the Lease in accordance with the terms of the Lease.
4. Miscellaneous. Except as amended by this Amendment, the Lease is not otherwise amended and the Lease remains in full force and effect, as amended hereby. In the event of a conflict between the terms of this Amendment and the terms of the Lease, the terms of this Amendment shall control. This Amendment may be executed in any number of counterparts, each of which shall be an original, but all of which together shall constitute one and the same instrument. Facsimile and electronic copies of this Amendment shall be deemed originals. Capitalized terms used in this Amendment and not otherwise defined have the respective meanings set forth in the Lease.
[end of page - signatures on the following page]
IN WITNESS WHEREOF, the Parties have duly executed this Amendment as of the Amendment Execution Date.
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| "LANDLORD" |
| | |
| NATIONAL HEALTH INVESTORS, INC. |
| | |
| By: | /s/Kristin S. Gaines |
| Print Name: | Kristin S. Gaines |
| Title: | Chief Credit Officer |
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| "TENANT" |
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| NHC/OP, L.P. |
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| By: | NHC Delaware, Inc. |
| Its: | General Partner |
| | |
| By: | /s/ R. Michael Ussery |
| Print Name: | R. Michael Ussery |
| Title: | V.P. |