(Exact name of Registrant as specified in its charter)
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Maryland
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38-3041398
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(State of incorporation)
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(IRS Employer
Identification No.)
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200 International Circle, Suite 3500, Hunt Valley, MD 21030
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(Address of principal executive offices)
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(410) 427-1700
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(Telephone number, including area code)
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Common Stock, $.10 par value
(Class)
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112,049,247
(Number of shares)
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TABLE OF CONTENTS
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Page
No. |
||||
September 30,
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December 31,
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|||||||
2012
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2011
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|||||||
(Unaudited)
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||||||||
ASSETS
|
||||||||
Real estate properties
|
||||||||
Land and buildings
|
$ | 2,786,213 | $ | 2,537,039 | ||||
Less accumulated depreciation
|
(550,381 | ) | (470,420 | ) | ||||
Real estate properties – net
|
2,235,832 | 2,066,619 | ||||||
Mortgage notes receivable – net
|
245,550 | 238,675 | ||||||
2,481,382 | 2,305,294 | |||||||
Other investments – net
|
45,807 | 52,957 | ||||||
2,527,189 | 2,358,251 | |||||||
Assets held for sale – net
|
1,620 | 2,461 | ||||||
Total investments
|
2,528,809 | 2,360,712 | ||||||
Cash and cash equivalents
|
6,951 | 351 | ||||||
Restricted cash
|
32,923 | 34,112 | ||||||
Accounts receivable – net
|
119,361 | 100,664 | ||||||
Other assets
|
71,396 | 61,473 | ||||||
Total assets
|
$ | 2,759,440 | $ | 2,557,312 | ||||
LIABILITIES AND STOCKHOLDERS’ EQUITY
|
||||||||
Revolving line of credit
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$ | 102,000 | $ | 272,500 | ||||
Secured borrowings
|
286,016 | 303,610 | ||||||
Unsecured borrowings – net
|
1,200,523 | 975,290 | ||||||
Accrued expenses and other liabilities
|
149,981 | 127,428 | ||||||
Total liabilities
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1,738,520 | 1,678,828 | ||||||
Stockholders’ equity:
|
||||||||
Common stock $.10 par value 200,000 shares authorized –– 112,046 shares as of September 30, 2012 and 103,410 as of December 31, 2011 issued and outstanding
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11,205 | 10,341 | ||||||
Common stock – additional paid-in-capital
|
1,658,882 | 1,471,381 | ||||||
Cumulative net earnings
|
720,205 | 633,430 | ||||||
Cumulative dividends paid
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(1,369,372 | ) | (1,236,668 | ) | ||||
Total stockholders’ equity
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1,020,920 | 878,484 | ||||||
Total liabilities and stockholders’ equity
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$ | 2,759,440 | $ | 2,557,312 |
Three Months Ended
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Nine Months Ended
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|||||||||||||||
September 30,
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September 30,
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|||||||||||||||
2012
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2011
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2012
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2011
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|||||||||||||
Revenue
|
||||||||||||||||
Rental income
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$ | 78,170 | $ | 68,622 | $ | 229,373 | $ | 203,446 | ||||||||
Mortgage interest income
|
7,677 | 3,617 | 22,417 | 10,548 | ||||||||||||
Other investment income – net
|
1,238 | 383 | 3,533 | 1,641 | ||||||||||||
Miscellaneous
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23 | 196 | 125 | 265 | ||||||||||||
Total operating revenues
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87,108 | 72,818 | 255,448 | 215,900 | ||||||||||||
Expenses
|
||||||||||||||||
Depreciation and amortization
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28,305 | 24,871 | 82,651 | 74,848 | ||||||||||||
General and administrative
|
5,173 | 4,393 | 15,653 | 14,549 | ||||||||||||
Acquisition costs
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483 | - | 686 | 45 | ||||||||||||
Impairment loss on real estate properties
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- | - | 272 | 24,971 | ||||||||||||
Provisions for uncollectible mortgages, notes and accounts receivable
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- | - | - | 4,139 | ||||||||||||
Nursing home expenses of owned and operated assets
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- | 148 | - | 603 | ||||||||||||
Total operating expenses
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33,961 | 29,412 | 99,262 | 119,155 | ||||||||||||
Income before other income and expense
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53,147 | 43,406 | 156,186 | 96,745 | ||||||||||||
Other income (expense)
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||||||||||||||||
Interest income
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6 | 12 | 22 | 35 | ||||||||||||
Interest expense
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(24,050 | ) | (20,101 | ) | (71,026 | ) | (60,173 | ) | ||||||||
Interest – amortization of deferred financing costs
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(673 | ) | (629 | ) | (1,970 | ) | (2,026 | ) | ||||||||
Interest – loss on extinguishment of debt
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- | (3,055 | ) | (5,410 | ) | (3,071 | ) | |||||||||
Total other expense
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(24,717 | ) | (23,773 | ) | (78,384 | ) | (65,235 | ) | ||||||||
Income before gain on assets sold
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28,430 | 19,633 | 77,802 | 31,510 | ||||||||||||
Gain on assets sold – net
|
1,689 | 1,803 | 8,973 | 1,803 | ||||||||||||
Net income
|
30,119 | 21,436 | 86,775 | 33,313 | ||||||||||||
Preferred stock dividends
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- | - | - | (1,691 | ) | |||||||||||
Preferred stock redemption
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- | - | - | (3,456 | ) | |||||||||||
Net income available to common stockholders
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$ | 30,119 | $ | 21,436 | $ | 86,775 | $ | 28,166 | ||||||||
Income per common share available to common shareholders:
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||||||||||||||||
Basic:
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||||||||||||||||
Net income
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$ | 0.28 | $ | 0.21 | $ | 0.82 | $ | 0.28 | ||||||||
Diluted:
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||||||||||||||||
Net income
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$ | 0.27 | $ | 0.21 | $ | 0.81 | $ | 0.28 | ||||||||
Dividends declared and paid per common share
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$ | 0.42 | $ | 0.40 | $ | 1.25 | $ | 1.15 | ||||||||
Weighted-average shares outstanding, basic
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109,135 | 103,180 | 106,202 | 101,722 | ||||||||||||
Weighted-average shares outstanding, diluted
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109,667 | 103,231 | 106,570 | 101,772 |
Common
Stock Par Value |
Additional
Paid-in Capital |
Cumulative
Net Earnings |
Cumulative
Dividends |
Total
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||||||||||||||||
Balance at December 31, 2011 (103,410 common shares)
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$ | 10,341 | $ | 1,471,381 | $ | 633,430 | $ | (1,236,668 | ) | $ | 878,484 | |||||||||
Issuance of common stock:
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||||||||||||||||||||
Grant of restricted stock to company executives (428 shares)
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43 | (43 | ) | — | — | — | ||||||||||||||
Grant of restricted stock to company directors (13 shares at $20.29 per share)
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1 | (1 | ) | — | — | — | ||||||||||||||
Amortization of restricted stock
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— | 4,410 | — | — | 4,410 | |||||||||||||||
Dividend reinvestment plan (4,791 shares at $22.16 per share)
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479 | 105,653 | — | — | 106,132 | |||||||||||||||
Grant of stock as payment of directors fees (7 shares at an average of $22.40 per share)
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1 | 149 | — | — | 150 | |||||||||||||||
Equity Shelf Program (3,398 shares at $23.47 per share, net of issuance costs)
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340 | 77,333 | — | — | 77,673 | |||||||||||||||
Net income
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— | — | 86,775 | — | 86,775 | |||||||||||||||
Common dividends ($1.25 per share)
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— | — | — | (132,704 | ) | (132,704 | ) | |||||||||||||
Balance at September 30, 2012 (112,046 common shares)
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$ | 11,205 | $ | 1,658,882 | $ | 720,205 | $ | (1,369,372 | ) | $ | 1,020,920 |
Nine Months Ended
September 30,
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||||||||
2012
|
2011
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|||||||
Cash flows from operating activities
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||||||||
Net income
|
$ | 86,775 | $ | 33,313 | ||||
Adjustment to reconcile net income to cash provided by operating activities:
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||||||||
Depreciation and amortization
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82,651 | 74,848 | ||||||
Impairment on real estate properties
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272 | 24,971 | ||||||
Provisions for uncollectible accounts receivable
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— | 4,139 | ||||||
Amortization of deferred financing and debt extinguishment costs
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7,380 | 5,097 | ||||||
Restricted stock amortization expense
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4,456 | 4,518 | ||||||
Gain on assets sold – net
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(8,973 | ) | (1,803 | ) | ||||
Amortization of acquired in-place leases - net
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(4,088 | ) | (4,640 | ) | ||||
Other
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(113 | ) | (112 | ) | ||||
Change in operating assets and liabilities – net of amounts assumed/acquired:
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||||||||
Accounts receivable, net
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195 | 355 | ||||||
Straight-line rent
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(19,745 | ) | (9,896 | ) | ||||
Lease inducement
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2,527 | 2,538 | ||||||
Effective yield receivable on mortgage notes
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(1,674 | ) | (932 | ) | ||||
Other operating assets and liabilities
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7,304 | (3,331 | ) | |||||
Operating assets and liabilities for owned and operated properties
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— | (47 | ) | |||||
Net cash provided by operating activities
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156,967 | 129,018 | ||||||
Cash flows from investing activities
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||||||||
Acquisition of real estate – net of liabilities assumed and escrows acquired
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(232,661 | ) | (98 | ) | ||||
Placement of mortgage loans
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(7,126 | ) | (10,461 | ) | ||||
Proceeds from sale of real estate investments
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24,194 | 4,150 | ||||||
Capital improvements and funding of other investments
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(20,106 | ) | (12,012 | ) | ||||
Proceeds from other investments
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11,821 | 3,186 | ||||||
Investments in other investments
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(4,671 | ) | (4,845 | ) | ||||
Collection of mortgage principal – net
|
362 | 54 | ||||||
Net cash used in investing activities
|
(228,187 | ) | (20,026 | ) | ||||
Cash flows from financing activities
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||||||||
Proceeds from credit facility borrowings
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272,000 | 289,000 | ||||||
Payments on credit facility borrowings
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(442,500 | ) | (244,000 | ) | ||||
Receipts of other long-term borrowings
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400,000 | — | ||||||
Payments of other long-term borrowings
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(189,657 | ) | (1,836 | ) | ||||
Payments of financing related costs
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(13,150 | ) | (4,236 | ) | ||||
Receipts from dividend reinvestment plan
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106,132 | 54,917 | ||||||
Net proceeds from issuance of common stock
|
77,673 | 31,237 | ||||||
Payments from exercised options and restricted stock – net
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— | (1,254 | ) | |||||
Dividends paid
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(132,678 | ) | (120,455 | ) | ||||
Redemption of preferred stock
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— | (108,556 | ) | |||||
Net cash provided by (used in) financing activities
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77,820 | (105,183 | ) | |||||
Increase in cash and cash equivalents
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6,600 | 3,809 | ||||||
Cash and cash equivalents at beginning of period
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351 | 6,921 | ||||||
Cash and cash equivalents at end of period
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$ | 6,951 | $ | 10,730 | ||||
Interest paid during the period, net of amounts capitalized
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$ | 70,123 | $ | 55,882 |
September 30,
2012
|
December 31,
2011
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|||||||
(in thousands)
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Contractual receivables
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$ | 6,261 | $ | 4,683 | ||||
Effective yield interest receivables
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3,015 | 1,341 | ||||||
Straight-line receivables
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93,312 | 73,604 | ||||||
Lease inducements
|
20,150 | 22,677 | ||||||
Allowance
|
(3,377 | ) | (1,641 | ) | ||||
Accounts receivable – net
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$ | 119,361 | $ | 100,664 |
Pro Forma
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Three Months Ended
September 30,
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Nine Months Ended
September 30,
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|||||||||||||||
2012
|
2011
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2012
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2011
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(in thousands, except per share amount, unaudited)
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Revenues
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$ | 91,157 | $ | 84,897 | $ | 273,039 | $ | 252,137 | ||||||||
Net income available to common stockholders
|
$ | 31,756 | $ | 25,386 | $ | 93,730 | $ | 40,016 | ||||||||
Earnings per share – diluted:
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||||||||||||||||
Net income available to common stockholders – as reported
|
$ | 0.27 | $ | 0.21 | $ | 0.81 | $ | 0.28 | ||||||||
Net income available to common stockholders – pro forma
|
$ | 0.29 | $ | 0.25 | $ | 0.88 | $ | 0.39 |
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●
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On January 13, 2012, we sold a SNF in Indiana for approximately $3.1 million resulting in a gain of approximately $0.3 million.
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On March 23, 2012, an operator in Alaska exercised its purchase option and purchased a SNF for approximately $11.0 million. We recognized a gain of approximately $5.1 million in this transaction.
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●
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On April 2, 2012, we sold a held-for-sale SNF in Arkansas for approximately $1.7 million. No gain or loss was recognized in this transaction.
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●
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On May 18, 2012, we sold a held-for-sale SNF in Alabama for $4.5 million resulting in a gain of approximately $0.4 million.
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●
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On June 15, 2012, we sold a held-for-sale SNF in Connecticut for $1.8 million resulting in a gain of approximately $1.6 million.
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●
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On August 21, 2012, we sold a held-for-sale SNF in Connecticut for $2.3 million resulting in a gain of approximately $1.6 million.
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Three Months Ended
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Nine Months Ended
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|||||||||||||||
September 30,
|
September 30,
|
|||||||||||||||
2012
|
2011
|
2012
|
2011
|
|||||||||||||
(in thousands)
|
||||||||||||||||
Nursing home revenues
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$ | — | $ | — | $ | — | $ | — | ||||||||
Nursing home expenses
|
— | 148 | — | 603 | ||||||||||||
Loss from nursing home operations
|
$ | — | $ | (148 | ) | $ | — | $ | (603 | ) |
Three Months Ended
September 30, |
Nine Months Ended
September 30,
|
|||||||||||||||
2012
|
2011
|
2012
|
2011
|
|||||||||||||
(in thousands)
|
||||||||||||||||
Stock-based compensation expense
|
$ | 1,485 | $ | 1,520 | $ | 4,456 | $ | 4,518 |
Shares/
Units |
Grant Date Average Fair Value Per
Unit/ Share |
Total Compensation Cost
(in millions)
|
Weighted Average Period of Expense Recognition (in months)
|
Unrecognized Compensation Cost
(in millions)
|
||||||||||||||||
Restricted stock
|
428,503 | $ | 22.44 | $ | 9.6 | 36 | $ | 4.0 | ||||||||||||
2012 Annual PRSUs
|
124,244 | $ | 9.61 | 1.2 | 12 | 0.3 | ||||||||||||||
Multi-year absolute TSR PRSUs
|
279,550 | $ | 11.06 | 3.1 | 44 | 1.6 | ||||||||||||||
Multi-year relative TSR PRSUs
|
93,183 | $ | 12.26 | 1.1 | 44 | 0.6 | ||||||||||||||
Total
|
925,480 | $ | 15.64 | $ | 15.0 | $ | 6.5 |
Current
|
September 30,
|
December 31,
|
||||||||||||||
Maturity
|
Rate
|
2012
|
2011
|
|||||||||||||
(in thousands)
|
||||||||||||||||
Secured borrowings:
|
||||||||||||||||
HUD Berkadia mortgages
(1)
|
2036 - 2040 | 6.61 | % | $ | 63,326 | $ | 64,533 | |||||||||
HUD Capital Funding mortgages
|
2040 - 2045 | 4.85 | % | 131,437 | 133,061 | |||||||||||
HUD White Pine mortgages
(1)
|
2036 - 2040 | 4.87 | % | 32,199 | 32,813 | |||||||||||
HUD Affiliates of CFG mortgages
(1)
|
2044 | 5.55 | % | 59,054 | 73,203 | |||||||||||
Total secured borrowings
|
286,016 | 303,610 | ||||||||||||||
Unsecured borrowings:
|
||||||||||||||||
Revolving line of credit
|
2015 | 1.93 | % | $ | 102,000 | $ | 272,500 | |||||||||
2016 Notes
|
2016 | 7.0 | % | — | 175,000 | |||||||||||
2020 Notes
|
2020 | 7.5 | % | 200,000 | 200,000 | |||||||||||
2022 Notes
|
2022 | 6.75 | % | 575,000 | 575,000 | |||||||||||
2024 Notes
|
2024 | 5.875 | % | 400,000 | — | |||||||||||
Subordinated debt
|
2021 | 9.0 | % | 21,090 | 21,219 | |||||||||||
1,196,090 | 971,219 | |||||||||||||||
Premium - net
|
4,433 | 4,071 | ||||||||||||||
Total unsecured borrowings
|
1,302,523 | 1,247,790 | ||||||||||||||
Totals
–
net
|
$ | 1,588,539 | $ | 1,551,400 |
|
(1)
|
Reflects the weighted average interest rate on the mortgages.
|
2012
|
2011
|
|||||||||||||||
Carrying
Amount
|
Fair
Value
|
Carrying
Amount
|
Fair
Value
|
|||||||||||||
Assets:
|
(in thousands)
|
|||||||||||||||
Cash and cash equivalents
|
$ | 6,951 | $ | 6,951 | $ | 351 | $ | 351 | ||||||||
Restricted cash
|
32,923 | 32,923 | 34,112 | 34,112 | ||||||||||||
Mortgage notes receivable – net
|
245,550 | 249,292 | 238,675 | 241,494 | ||||||||||||
Other investments – net
|
45,807 | 42,758 | 52,957 | 48,903 | ||||||||||||
Totals
|
$ | 331,231 | $ | 331,924 | $ | 326,095 | $ | 324,860 | ||||||||
Liabilities:
|
||||||||||||||||
Revolving line of credit
|
$ | 102,000 | $ | 102,000 | $ | 272,500 | $ | 272,500 | ||||||||
7.00% Notes due 2016 – net
|
— | — | 174,376 | 186,398 | ||||||||||||
7.50% Notes due 2020 – net
|
197,460 | 238,726 | 197,202 | 216,114 | ||||||||||||
6.75% Notes due 2022 – net
|
581,973 | 733,718 | 582,493 | 582,684 | ||||||||||||
5.875% Notes due 2024 – net
|
400,000 | 435,092 | — | — | ||||||||||||
HUD debt
|
286,016 | 358,436 | 303,610 | 321,949 | ||||||||||||
Subordinated debt
|
21,090 | 27,968 | 21,219 | 23,198 | ||||||||||||
Totals
|
$ | 1,588,539 | $ | 1,895,940 | $ | 1,551,400 | $ | 1,602,843 |
|
●
|
Cash and cash equivalents and restricted cash: The carrying amount of cash and cash equivalents and restricted cash reported in the balance sheet approximates fair value because of the short maturity of these instruments (i.e., less than 90 days).
|
|
●
|
Mortgage notes receivable: The fair values of the mortgage notes receivables are estimated using a discounted cash flow analysis, using interest rates being offered for similar loans to borrowers with similar credit ratings (Level 2).
|
|
●
|
Other investments: Other investments are primarily comprised of: (i) notes receivable and (ii) an investment in redeemable non-convertible preferred security of an unconsolidated business accounted for using the cost method of accounting. The fair values of notes receivable are estimated using a discounted cash flow analysis, using interest rates being offered for similar loans to borrowers with similar credit ratings (Level 2). The fair value of the investment in the unconsolidated business is estimated using quoted market value and considers the terms of the underlying arrangement (Level 2).
|
|
●
|
Revolving line of credit: The fair value of our borrowings under variable rate agreements are estimated using an expected present value technique based on expected cash flows discounted using the current market rates (Level 2).
|
|
●
|
Senior notes and other long-term borrowings: The fair value of our borrowings under fixed rate agreements are estimated based on open market trading activity provided by a third party (Level 2).
|
Three Months Ended
September 30,
|
Nine Months Ended
September 30,
|
|||||||||||||||
2012
|
2011
|
2012
|
2011
|
|||||||||||||
(in thousands, except per share amounts)
|
||||||||||||||||
Numerator:
|
||||||||||||||||
Net income
|
$ | 30,119 | $ | 21,436 | $ | 86,775 | $ | 33,313 | ||||||||
Preferred stock dividends
|
— | — | — | (1,691 | ) | |||||||||||
Preferred stock redemption
|
— | — | — | (3,456 | ) | |||||||||||
Numerator for net income available to common per share - basic and diluted
|
$ | 30,119 | $ | 21,436 | $ | 86,775 | $ | 28,166 | ||||||||
Denominator:
|
||||||||||||||||
Denominator for basic earnings per share
|
109,135 | 103,180 | 106,202 | 101,722 | ||||||||||||
Effect of dilutive securities:
|
||||||||||||||||
Restricted stock
|
511 | 38 | 350 | 38 | ||||||||||||
Deferred stock
|
21 | 13 | 18 | 12 | ||||||||||||
Denominator for diluted earnings per share
|
109,667 | 103,231 | 106,570 | 101,772 | ||||||||||||
Earnings per share – basic:
|
||||||||||||||||
Net income – basic
|
$ | 0.28 | $ | 0.21 | $ | 0.82 | $ | 0.28 | ||||||||
Earnings per share – diluted:
|
||||||||||||||||
Net income – diluted
|
$ | 0.27 | $ | 0.21 | $ | 0.81 | $ | 0.28 |
September 30, 2012
|
||||||||||||||||
Issuer & Subsidiary Guarantors
|
Non-Guarantor Subsidiaries
|
Elimination Company
|
Consolidated
|
|||||||||||||
Real estate properties
|
||||||||||||||||
Land and buildings
|
$ | 2,344,862 | $ | 441,351 | $ | — | $ | 2,786,213 | ||||||||
Less accumulated depreciation
|
(510,675 | ) | (39,706 | ) | — | (550,381 | ) | |||||||||
Real estate properties – net
|
1,834,187 | 401,645 | — | 2,235,832 | ||||||||||||
Mortgage notes receivable – net
|
245,550 | — | — | 245,550 | ||||||||||||
2,079,737 | 401,645 | — | 2,481,382 | |||||||||||||
Other investments – net
|
45,807 | — | — | 45,807 | ||||||||||||
2,125,544 | 401,645 | — | 2,527,189 | |||||||||||||
Assets held for sale – net
|
1,620 | — | — | 1,620 | ||||||||||||
Total investments
|
2,127,164 | 401,645 | — | 2,528,809 | ||||||||||||
Cash and cash equivalents
|
6,951 | — | — | 6,951 | ||||||||||||
Restricted cash
|
6,629 | 26,294 | — | 32,923 | ||||||||||||
Accounts receivable – net
|
113,533 | 5,828 | — | 119,361 | ||||||||||||
Investment in affiliates
|
109,767 | — | (109,767 | ) | — | |||||||||||
Other assets
|
40,116 | 31,280 | — | 71,396 | ||||||||||||
Total assets
|
$ | 2,404,160 | $ | 465,047 | $ | (109,767 | ) | $ | 2,759,440 | |||||||
LIABILITIES AND STOCKHOLDERS’ EQUITY
|
||||||||||||||||
Revolving line of credit
|
$ | 102,000 | $ | — | $ | — | $ | 102,000 | ||||||||
Secured borrowings
|
— | 286,016 | — | 286,016 | ||||||||||||
Unsecured borrowings – net
|
1,179,433 | 21,090 | — | 1,200,523 | ||||||||||||
Accrued expenses and other liabilities
|
101,807 | 48,174 | — | 149,981 | ||||||||||||
Intercompany payable
|
— | 92,242 | (92,242 | ) | — | |||||||||||
Total liabilities
|
1,383,240 | 447,522 | $ | (92,242 | ) | $ | 1,738,520 | |||||||||
Stockholders’ equity:
|
||||||||||||||||
Common stock
|
11,205 | — | — | 11,205 | ||||||||||||
Common stock – additional paid-in-capital
|
1,658,882 | — | — | 1,658,882 | ||||||||||||
Cumulative net earnings
|
720,205 | 17,525 | (17,525 | ) | 720,205 | |||||||||||
Cumulative dividends paid
|
(1,369,372 | ) | — | — | (1,369,372 | ) | ||||||||||
Total stockholders’ equity
|
1,020,920 | 17,525 | $ | (17,525 | ) | 1,020,920 | ||||||||||
Total liabilities and stockholders’ equity
|
$ | 2,404,160 | $ | 465,047 | $ | (109,767 | ) | 2,759,440 |
December 31, 2011
|
||||||||||||||||
Issuer & Subsidiary Guarantors
|
Non – Guarantor Subsidiaries
|
Elimination Company
|
Consolidated
|
|||||||||||||
ASSETS
|
||||||||||||||||
Real estate properties
|
||||||||||||||||
Land and buildings
|
$ | 2,095,441 | $ | 441,598 | $ | — | $ | 2,537,039 | ||||||||
Less accumulated depreciation
|
(446,581 | ) | (23,839 | ) | — | (470,420 | ) | |||||||||
Real estate properties – net
|
1,648,860 | 417,759 | — | 2,066,619 | ||||||||||||
Mortgage notes receivable – net
|
238,675 | — | — | 238,675 | ||||||||||||
1,887,535 | 417,759 | — | 2,305,294 | |||||||||||||
Other investments – net
|
52,957 | — | — | 52,957 | ||||||||||||
1,940,492 | 417,759 | — | 2,358,251 | |||||||||||||
Assets held for sale – net
|
2,461 | — | — | 2,461 | ||||||||||||
Total investments
|
1,942,953 | 417,759 | — | 2,360,712 | ||||||||||||
Cash and cash equivalents
|
351 | — | — | 351 | ||||||||||||
Restricted cash
|
6,511 | 27,601 | — | 34,112 | ||||||||||||
Accounts receivable – net
|
97,407 | 3,257 | — | 100,664 | ||||||||||||
Investment in affiliates
|
119,564 | — | (119,564 | ) | — | |||||||||||
Other assets
|
32,798 | 28,675 | — | 61,473 | ||||||||||||
Total assets
|
$ | 2,199,584 | $ | 477,292 | (119,564 | ) | $ | 2,557,312 | ||||||||
LIABILITIES AND STOCKHOLDERS’ EQUITY
|
||||||||||||||||
Revolving line of credit
|
$ | 272,500 | $ | — | $ | — | $ | 272,500 | ||||||||
Secured borrowings
|
13,652 | 289,958 | — | 303,610 | ||||||||||||
Unsecured borrowings – net
|
954,071 | 21,219 | — | 975,290 | ||||||||||||
Accrued expenses and other liabilities
|
80,877 | 46,551 | — | 127,428 | ||||||||||||
Intercompany payable
|
— | 109,907 | (109,907 | ) | — | |||||||||||
Total liabilities
|
1,321,100 | 467,635 | (109,907 | ) | 1,678,828 | |||||||||||
Stockholders’ equity:
|
||||||||||||||||
Common stock
|
10,341 | — | — | 10,341 | ||||||||||||
Common stock – additional paid-in-capital
|
1,471,381 | — | — | 1,471,381 | ||||||||||||
Cumulative net earnings
|
633,430 | 9,657 | (9,657 | ) | 633,430 | |||||||||||
Cumulative dividends paid
|
(1,236,668 | ) | — | — | (1,236,668 | ) | ||||||||||
Total stockholders’ equity
|
878,484 | 9,657 | (9,657 | ) | 878,484 | |||||||||||
Total liabilities and stockholders’ equity
|
$ | 2,199,584 | $ | 477,292 | $ | (119,564 | ) | $ | 2,557,312 |
Three Months Ended September 30, 2012
|
Nine Months Ended September 30, 2012
|
|||||||||||||||||||||||||||||||
Issuer & Subsidiary Guarantors
|
Non – Guarantor Subsidiaries
|
Elimination
|
Consolidated
|
Issuer & Subsidiary Guarantors
|
Non – Guarantor Subsidiaries
|
Elimination
|
Consolidated
|
|||||||||||||||||||||||||
Revenue
|
||||||||||||||||||||||||||||||||
Rental income
|
$ | 66,231 | $ | 11,939 | $ | - | $ | 78,170 | $ | 193,411 | $ | 35,962 | $ | - | $ | 229,373 | ||||||||||||||||
Mortgage interest income
|
7,677 | - | - | 7,677 | 22,417 | - | - | 22,417 | ||||||||||||||||||||||||
Other investment income – net
|
1,238 | - | - | 1,238 | 3,533 | - | - | 3,533 | ||||||||||||||||||||||||
Miscellaneous
|
23 | - | - | 23 | 125 | - | - | 125 | ||||||||||||||||||||||||
Total operating revenues
|
75,169 | 11,939 | - | 87,108 | 219,486 | 35,962 | - | 255,448 | ||||||||||||||||||||||||
Expenses
|
||||||||||||||||||||||||||||||||
Depreciation and amortization
|
22,996 | 5,309 | - | 28,305 | 66,784 | 15,867 | - | 82,651 | ||||||||||||||||||||||||
General and administrative
|
5,062 | 111 | - | 5,173 | 15,305 | 348 | - | 15,653 | ||||||||||||||||||||||||
Acquisition costs
|
483 | - | - | 483 | 686 | - | - | 686 | ||||||||||||||||||||||||
Impairment loss on real estate properties
|
- | - | - | - | 272 | - | - | 272 | ||||||||||||||||||||||||
Total operating expenses
|
28,541 | 5,420 | - | 33,961 | 83,047 | 16,215 | - | 99,262 | ||||||||||||||||||||||||
Income before other income and expense
|
46,628 | 6,519 | - | 53,147 | 136,439 | 19,747 | - | 156,186 | ||||||||||||||||||||||||
Other income (expense):
|
||||||||||||||||||||||||||||||||
Interest income
|
- | 6 | - | 6 | 2 | 20 | - | 22 | ||||||||||||||||||||||||
Interest expense
|
(19,883 | ) | (4,167 | ) | - | (24,050 | ) | (59,127 | ) | (11,899 | ) | - | (71,026 | ) | ||||||||||||||||||
Interest – amortization of deferred financing costs
|
(673 | ) | - | - | (673 | ) | (1,970 | ) | - | - | (1,970 | ) | ||||||||||||||||||||
Interest – loss on extinguishment of debt
|
- | - | - | - | (5,410 | ) | - | - | (5,410 | ) | ||||||||||||||||||||||
Equity in earnings
|
2,358 | - | (2,358 | ) | - | 7,868 | - | (7,868 | ) | - | ||||||||||||||||||||||
Total other expense
|
(18,198 | ) | (4,161 | ) | (2,358 | ) | (24,717 | ) | (58,637 | ) | (11,879 | ) | (7,868 | ) | (78,384 | ) | ||||||||||||||||
Income before gain on assets sold
|
28,430 | 2,358 | (2,358 | ) | 28,430 | 77,802 | 7,868 | (7,868 | ) | 77,802 | ||||||||||||||||||||||
Gain on assets sold – net
|
1,689 | - | - | 1,689 | 8,973 | - | - | 8,973 | ||||||||||||||||||||||||
Net income available to common stockholders
|
$ | 30,119 | $ | 2,358 | $ | (2,358 | ) | $ | 30,119 | $ | 86,775 | $ | 7,868 | $ | (7,868 | ) | $ | 86,775 |
Three Months Ended September 30, 2011
|
Nine Months Ended September 30, 2011 | |||||||||||||||||||||||||||||||
Issuer & Subsidiary Guarantors
|
Non – Guarantor Subsidiaries
|
Elimination
Company
|
Consolidated
|
Issuer & Subsidiary Guarantors
|
Non – Guarantor Subsidiaries
|
Elimination
Company
|
Consolidated
|
|||||||||||||||||||||||||
Revenue
|
||||||||||||||||||||||||||||||||
Rental income
|
$ | 60,333 | $ | 8,289 | $ | - | $ | 68,622 | $ | 178,289 | $ | 25,157 | $ | - | $ | 203,446 | ||||||||||||||||
Mortgage interest income
|
3,617 | - | - | 3,617 | 10,548 | - | - | 10,548 | ||||||||||||||||||||||||
Other investment income – net
|
383 | - | - | 383 | 1,641 | - | - | 1,641 | ||||||||||||||||||||||||
Miscellaneous
|
196 | - | - | 196 | 265 | - | - | 265 | ||||||||||||||||||||||||
Total operating revenues
|
64,529 | 8,289 | - | 72,818 | 190,743 | 25,157 | - | 215,900 | ||||||||||||||||||||||||
Expenses
|
||||||||||||||||||||||||||||||||
Depreciation and amortization
|
21,000 | 3,871 | - | 24,871 | 63,421 | 11,427 | - | 74,848 | ||||||||||||||||||||||||
General and administrative
|
4,329 | 64 | - | 4,393 | 14,324 | 225 | - | 14,549 | ||||||||||||||||||||||||
Acquisition costs
|
- | - | - | - | 45 | - | - | 45 | ||||||||||||||||||||||||
Impairment loss on real estate properties
|
- | - | - | - | 24,971 | - | - | 24,971 | ||||||||||||||||||||||||
Provisions for uncollectible accounts receivable
|
- | - | - | - | 4,139 | - | - | 4,139 | ||||||||||||||||||||||||
Nursing home expenses of owned and operated assets
|
148 | - | - | 148 | 603 | - | - | 603 | ||||||||||||||||||||||||
Total operating expenses
|
25,477 | 3,935 | - | 29,412 | 107,503 | 11,652 | - | 119,155 | ||||||||||||||||||||||||
Income before other income and expense
|
39,052 | 4,354 | - | 43,406 | 83,240 | 13,505 | - | 96,745 | ||||||||||||||||||||||||
Other income (expense):
|
||||||||||||||||||||||||||||||||
Interest income
|
6 | 6 | - | 12 | 15 | 20 | - | 35 | ||||||||||||||||||||||||
Interest expense
|
(17,374 | ) | (2,727 | ) | - | (20,101 | ) | (51,922 | ) | (8,251 | ) | - | (60,173 | ) | ||||||||||||||||||
Interest – amortization of deferred financing costs
|
(629 | ) | - | - | (629 | ) | (2,026 | ) | - | - | (2,026 | ) | ||||||||||||||||||||
Interest –refinancing costs
|
(3,055 | ) | - | - | (3,055 | ) | (3,071 | ) | - | - | (3,071 | ) | ||||||||||||||||||||
Equity in earnings
|
1,633 | - | (1,633 | ) | - | 5,274 | - | (5,274 | ) | - | ||||||||||||||||||||||
Total other expense
|
(19,419 | ) | (2,721 | ) | (1,633 | ) | (23,773 | ) | (51,730 | ) | (8,231 | ) | (5,274 | ) | (65,235 | ) | ||||||||||||||||
Income before gain on assets sold
|
19,633 | 1,633 | (1,633 | ) | 19,633 | 31,510 | 5,274 | (5,274 | ) | 31,510 | ||||||||||||||||||||||
Gain on assets sold - net
|
1,803 | - | - | 1,803 | 1,803 | - | - | 1,803 | ||||||||||||||||||||||||
Net income
|
21,436 | 1,633 | (1,633 | ) | 21,436 | 33,313 | 5,274 | (5,274 | ) | 33,313 | ||||||||||||||||||||||
Preferred stock dividends
|
- | - | - | - | (1,691 | ) | - | - | (1,691 | ) | ||||||||||||||||||||||
Preferred stock redemption
|
- | - | - | - | (3,456 | ) | - | - | (3,456 | ) | ||||||||||||||||||||||
Net income available to common stockholders
|
$ | 21,436 | $ | 1,633 | $ | (1,633 | ) | $ | 21,436 | $ | 28,166 | $ | 5,274 | $ | (5,274 | ) | $ | 28,166 |
|
(i)
|
those items discussed under “Risk Factors” in Item 1A to our annual report on Form 10-K for the year ended December 31, 2011, in Part II, Item IA of our Quarterly Report on Form 10-Q for the three months ended March 31, 2012 and June 30, 2012, and in Part II, Item 1A of this report;
|
|
(ii)
|
uncertainties relating to the business operations of the operators of our assets, including those relating to reimbursement by third-party payors, regulatory matters and occupancy levels;
|
|
(iii)
|
the ability of any operators in bankruptcy to reject unexpired lease obligations, modify the terms of our mortgages and impede our ability to collect unpaid rent or interest during the process of a bankruptcy proceeding and retain security deposits for the debtors’ obligations;
|
|
(iv)
|
our ability to sell closed or foreclosed assets on a timely basis and on terms that allow us to realize the carrying value of these assets;
|
|
(v)
|
our ability to negotiate appropriate modifications to the terms of our credit facilities;
|
|
(vi)
|
our ability to manage, re-lease or sell any owned and operated facilities;
|
|
(vii)
|
the availability and cost of capital;
|
|
(viii)
|
changes in our credit ratings and the ratings of our debt securities;
|
|
(ix)
|
competition in the financing of healthcare facilities;
|
|
(x)
|
regulatory and other changes in the healthcare sector;
|
|
(xi)
|
the effect of economic and market conditions generally and, particularly, in the healthcare industry;
|
|
(xii)
|
changes in the financial position of our operators;
|
|
(xiii)
|
changes in interest rates;
|
|
(xiv)
|
the amount and yield of any additional investments;
|
|
(xv)
|
changes in tax laws and regulations affecting real estate investment trusts; and
|
|
(xvi)
|
our ability to maintain our status as a real estate investment trust.
|
Three Months Ended
|
Nine Months Ended
|
|||||||||||||||
September 30,
|
September 30,
|
|||||||||||||||
2012
|
2011
|
2012
|
2011
|
|||||||||||||
(in thousands)
|
||||||||||||||||
Net income available to common stockholders
|
$ | 30,119 | $ | 21,436 | $ | 86,775 | $ | 28,166 | ||||||||
Deduct gain from real estate dispositions
|
(1,689 | ) | (1,803 | ) | (8,973 | ) | (1,803 | ) | ||||||||
Sub-total
|
28,430 | 19,633 | 77,802 | 26,363 | ||||||||||||
Elimination of non-cash items included in net income:
|
||||||||||||||||
Depreciation and amortization
|
28,305 | 24,871 | 82,651 | 74,848 | ||||||||||||
Add back impairments on real estate properties
|
— | — | 272 | 24,971 | ||||||||||||
Funds from operations available to common stockholders
|
$ | 56,735 | $ | 44,504 | $ | 160,725 | $ | 126,182 |
|
●
|
On January 13, 2012, we sold a SNF in Indiana for approximately $3.1 million resulting in a gain of approximately $0.3 million.
|
|
●
|
On March 23, 2012, an operator in Alaska exercised its purchase option and purchased a SNF for approximately $11.0 million. We recognized a gain of approximately $5.1 million in this transaction.
|
|
●
|
On April 2, 2012, we sold a held-for-sale SNF in Arkansas for approximately $1.7 million. No gain or loss was recognized in this transaction.
|
|
●
|
On May 18, 2012, we sold a held-for-sale SNF in Alabama for $4.5 million resulting in a gain of approximately $0.4 million.
|
|
●
|
On June 15, 2012, we sold a held-for-sale SNF in Connecticut for $1.8 million resulting in a gain of approximately $1.6 million.
|
|
●
|
On August 21, 2012, we sold a held-for-sale SNF in Connecticut for $2.3 million resulting in a gain of approximately $1.6 million.
|
Exhibit No.
|
||
10.1
|
Amended and Restated Deferred Stock Plan, dated October 16, 2012, and forms of related agreements.+*
|
|
31.1
|
Rule 13a-14(a)/15d-14(a) Certification of the Chief Executive Officer.
|
|
31.2
|
Rule 13a-14(a)/15d-14(a) Certification of the Chief Financial Officer.
|
|
32.1
|
Section 1350 Certification of the Chief Executive Officer.
|
|
32.2
|
Section 1350 Certification of the Chief Financial Officer.
|
|
101.INS
|
XBRL Instance Document.**
|
|
101.SCH
|
XBRL Taxonomy Extension Schema Document.**
|
|
101.CAL
|
XBRL Taxonomy Extension Calculation Linkbase Document.**
|
|
101.DEF
|
XBRL Taxonomy Extension Definition Linkbase Document.**
|
|
101.LAB
|
XBRL Taxonomy Extension Label Linkbase Document.**
|
|
101.PRE
|
XBRL Taxonomy Extension Presentation Linkbase Document.**
|
OMEGA HEALTHCARE INVESTORS, INC.
Registrant |
|||
Date: November 7, 2012
|
By:
|
/S/ C. TAYLOR PICKETT | |
C. Taylor Pickett | |||
Chief Executive Officer | |||
Date: November 7, 2012 | By: | /S/ ROBERT O. STEPHENSON | |
Robert O. Stephenson | |||
Chief Financial Officer |
SECTION
|
PAGE NUMBER
|
|||
1.
|
BACKGROUND AND INTERPRETATION
|
1
|
||
2.
|
ELIGIBILITY
|
1
|
||
3.
|
DEFERRAL ELECTIONS
|
1
|
||
4.
|
TIMING OF ELECTIONS
|
1
|
||
5.
|
TERMS AND CONDITIONS OF DEFERRED STOCK GRANTS
|
3
|
||
6.
|
SOURCE OF SHARES UNDER PLAN
|
4
|
||
7.
|
CHANGE IN CAPITALIZATION
|
4
|
||
8.
|
ADMINISTRATION
|
5
|
||
9.
|
UNFUNDED PLAN
|
6
|
||
10
|
PARTICIPATION VOLUNTARY
|
6
|
||
11.
|
AMENDMENT AND TERMINATION
|
6
|
||
12.
|
GOVERNING LAW
|
6
|
||
13.
|
DEFINITIONS
|
6
|
||
14.
|
CLAIMS PROCEDURES FOR EMPLOYEES
|
8
|
2.
|
12.
|
13.
|
OMEGA HEALTHCARE INVESTORS, INC.
|
|||||
By: | |||||
Title: |
A.
|
Effect of Agreement
: This Agreement relates to the grants of
restricted stock units specified in paragraph D below.
|
||
This election will be given effect only to the extent that the compensation to be deferred satisfies the requirements under Treas. Reg. Section 1.409A- . | |||
If the Officer wishes to revoke or modify this election, he may submit a written election to do so to the Company’s Chief Financial Officer by , 20 , . | |||
B.
|
“
Plan
”: (under which the “Shares” (as defined below) will be issued) Omega Healthcare Investors, Inc.
Plan.
|
C.
|
“
Deferred Stock Plan
”: Omega Healthcare Investors, Inc. Deferred Stock Plan, to which this Agreement is also subject.
|
D.
|
“
Stock Units
”: This Agreement relates to the grants of ___________ restricted stock units with respect to the Company’s common stock specified below. (You must check the box(es) that apply):
|
E.
|
“
Dividend Equivalents
”: Each Stock Unit shall accrue an amount equal to the dividends per share payable on Common Stock to shareholders of record in accordance with the terms of the Original Agreement through
the Original Payment Date
and thereafter through the day before the date the Shares are issued.
|
|
1.
|
[ ]
|
“
Converted Dividend Equivalents
”: The Dividend Equivalents will be converted into a number of Stock Units equal to (a) the amount of the Dividend Equivalents that are accrued under the Original Agreement as of the date that payment would otherwise have been made under the Original Agreement, divided by the closing price per share of Stock on such date, plus (b) the amount of the Dividend Equivalents that are accrued thereafter as of each dividend payment date, divided by the closing price per share of Stock on such date. Such Stock Units shall also accrue future Dividend Equivalents that shall be converted into Stock Units in accordance with the preceding formula in subparagraph (b). The Stock Units under this paragraph shall be paid on the date the Shares are payable to the Officer; or
|
|
2.
|
[ ]
|
“
Deferred Dividend Equivalents
”: The Dividend Equivalents
shall be paid to the Officer
, with interest accrued on a quarterly basis from the Original Payment Date at a rate equal to the Company’s average borrowing rate for the preceding calendar quarter, as determined in the sole discretion of the Committee, on the date the Shares are payable to the Officer
; or
|
|
3.
|
[ ]
|
“
Current Dividend Equivalents
”: The Dividend Equivalents that are accrued as of the Original Payment Date shall be paid to the Officer on the Original Payment Date and the Dividend Equivalents thereafter will be paid on the same date that the dividends per share are paid to shareholders.
|
F.
|
“
Deferral Period
”: The Officer has elected to defer receipt of the Shares (and Converted Dividend Equivalents or Deferred Dividend Equivalents if paragraph E.1. or E.2. was elected) until the dates or events set forth below:
|
1.
|
If you complete this paragraph 1, you must complete A or B below:
|
A.
|
[ ]
in one lump sum in the month of ___________, 20___ (specify month and year); or
|
B.
|
[ ]
in annual ratable installments over __ calendar years (specify number of calendar years) with the first payment being made in the month of ___________, 20___ (specify month and year) and each subsequent payment being made in the month of _________ (specify month) of each calendar year thereafter.
|
2.
|
If you complete this paragraph 2, you must check A or B below, but not both:
|
A.
|
[ ]
upon the date that is six(6) months following the Officer’s Separation from Service; or
|
B.
|
[ ]
in the month of _____________ (specify month) of the __________ (specify number, first, second, etc.) calendar year following the calendar year of the Officer’s Separation from Service (but not earlier than six (6) months following the Officer’s Separation from Service.
|
(i)
|
[ ]
in one lump sum; or
|
|
(ii) |
[ ] in annual ratable installments over __ calendar years (specify number of calendar years), with each payment after the first payment being made in the month of ____________ (specify month) of each calendar year.
|
3.
|
[ ]
the earlier of paragraph 1 or 2 above.
|
4.
|
[ ]
the later of paragraph 1 or 2 above.
|
5.
|
[ ]
If a Change in Control occurs before the date payment is required to be made pursuant to the elections above, payment shall be made in one lump sum upon the Change in Control.
|
6.
|
[ ]
If the Officer becomes subject to a Disability before the date payment is required to be made pursuant to the elections above, payment shall be made in one lump sum upon the Disability.
|
(i)
|
the election shall not take effect until twelve (12) months after the date the written election is submitted to the Company;
|
(ii)
|
in the case of an election related to a payment date or event other than Disability, the election must defer payment for at least five (5) years from the date payment would otherwise have been made under this Agreement (i.e., date of lump sum or first installment payment); and
|
(iii)
|
in the case of a payment at a specified date, the election must be submitted at least twelve (12) months before the date payment (i.e. lump sum or first installment payment) was previously scheduled to be made under this Agreement.
|
OFFICER | OMEGA HEALTHCARE INVESTORS, INC. | |||
|
By:
|
|||
[Signature] | Title: |
|
(a)
|
“
Change in Control
” means:
|
|
(i)
|
“A change in the ownership of the corporation,”
|
|
(ii)
|
“A change in the effective control of the corporation,” or
|
|
(iii)
|
“A change in the ownership of a substantial portion of the assets of the corporation,”
|
|
(b)
|
“
Disability
” means any condition that would constitute a “disability” under the Deferred Stock Plan.
|
|
(c)
|
“
Separation from Service
” means a “separation from service” within the meaning of Treas. Reg. Section 1.409A-1.
|
|
(d)
|
“
Unforeseeable Emergency
” means an “unforeseeable emergency” within the meaning of Treas. Reg. Section 1.409A-3.
|
|
A.
|
Effect of Agreement
: This Agreement relates to the quarterly grants of Stock to the Director scheduled to be made for the years 20__ through 20__ (specify years) and that were previously deferred by the Director pursuant to a Deferred Stock Agreement dated ____________, 20___ (the “
Original Deferral Agreement
”).
|
|
B.
|
“
Plan
”: (under which the “Shares” (as defined below) will be issued) Omega Healthcare Investors, Inc.__________________________ Plan.
|
|
C.
|
“
Deferred Stock Plan
”: Omega Healthcare Investors, Inc. Deferred Stock Plan, to which this Agreement is also subject.
|
|
D.
|
“
Stock Units
”: This Agreement relates to the quarterly grants of Stock to the Director as specified in paragraph A above.
|
|
E.
|
“
Dividend Equivalents
”: Each Stock Unit shall accrue an amount equal to the dividends per share payable on Stock to shareholders of record on or after the Applicable Quarterly Grant Date and through the day before the date the Shares are issued.
|
|
1.
|
[ ]
|
“
Converted Dividend Equivalents
”: The Dividend Equivalents will be converted into a number of Stock Units equal to the amount of the Dividend Equivalents that are accrued as of the dividend payment date, divided by the closing price per share of Stock on the dividend payment date. Such Stock Units shall also accrue future Dividend Equivalents that shall be converted into Stock Units in accordance with the preceding formula. The Stock Units under this paragraph shall be paid on the date the Shares are payable to the Director; or
|
|
2.
|
[ ]
|
“
Deferred Dividend Equivalents
”: The Dividend Equivalents
shall be paid to the
Director, with interest accrued on a quarterly basis at a rate equal to the Company’s average borrowing rate for the preceding calendar quarter, as determined in the sole discretion of the Committee, on the date the Shares are payable to the Director
; or
|
|
3.
|
[ ]
|
“
Current Dividend Equivalents
”: The Dividend Equivalents shall be paid to the Director on the same date that the dividends per share are paid to shareholders.
|
|
F.
|
“
Deferral Period
”: The Director is now electing to defer receipt of the Shares (and Converted Dividend Equivalents or Deferred Dividend Equivalents if paragraph E.1. or E.2. was elected) until the dates or events set forth below:
|
1.
|
[ ]
|
If you complete this paragraph 1, you must complete A or B below:
|
|
A.
|
[ ]
|
in one lump sum in the month of ___________, 20___ (specify month and year); or
|
|
B.
|
[ ]
|
in annual ratable installments over __ calendar years (specify number of calendar years) with the first payment being made in the month of ___________, 20___ (specify month and year) and each subsequent payment being made in the month of _________ (specify month) of each calendar year thereafter.
|
|
2.
|
If you complete this paragraph 2, you must check A or B below, but not both:
|
|
A.
|
[ ]
|
upon the Director’s Separation from Service; or
|
|
B.
|
[ ]
|
in the month of the __________ (specify month) of the ___________ (specify number, first, second, etc.) calendar year following the calendar year of the Director’s Separation from Service.
|
|
|
The balance in paragraph 2A or 2B will be paid (check (i) or (ii) but not both):
|
|
|
(i)
|
[ ]
|
in one lump sum; or
|
|
(ii)
|
[ ]
|
in annual ratable installments over ___ calendar years (specify number of calendar years), with each payment after the first payment being made in the month of ____________ (specify month) of each calendar year.
|
3.
|
[ ]
|
the earlier of paragraph 1 or 2 above.
|
4.
|
[ ]
|
the later of paragraph 1 or 2 above.
|
5.
|
[ ]
|
If a Change in Control occurs before the date payment is required to be made pursuant to the elections above, payment shall be made in one lump sum upon the Change in Control (subject to five (5) year additional deferral period described below).
|
6.
|
[ ]
|
If the Director becomes subject to a Disability before the date payment is required to be made pursuant to the elections above, payment shall be made in one lump sum upon the Disability.
|
|
(iv)
|
the election shall not take effect until twelve (12) months after the date the written election is submitted to the Company;
|
|
(v)
|
in the case of an election related to a payment date or event other than Disability, the election must defer payment for at least five (5) years from the date such payment would otherwise have been made (i.e., date of lump sum or first installment payment) pursuant to the Original Deferral Agreement, and the election shall be construed and given effect in such manner to require such minimum additional deferral period; and
|
|
(vi)
|
in the case of a payment at a specified date, the election must be submitted at least twelve (12) months before the date payment (i.e., lump sum or first installment payment) was previously scheduled to be made.
|
|
(i)
|
the election shall not take effect until twelve (12) months after the date the written election is submitted to the Company;
|
|
(ii)
|
in the case of an election related to a payment date or event other than Disability, the election must defer payment for at least five (5) years from the date payment would otherwise have been made (i.e., date of lump sum or first installment payment); and
|
|
(iii)
|
in the case of a payment at a specified date, the election must be submitted at least twelve (12) months before the date payment (i.e., lump sum or first installment payment) was previously scheduled to be made.
|
DIRECTOR | OMEGA HEALTHCARE INVESTORS, INC. | |||
|
By:
|
|||
[Signature] | Title: |
|
(e)
|
“
Change in Control
” means:
|
|
(iv)
|
“A change in the ownership of the corporation,”
|
|
(v)
|
“A change in the effective control of the corporation,” or
|
|
(vi)
|
“A change in the ownership of a substantial portion of the assets of the corporation,”
|
|
(f)
|
“
Disability
” means any condition that would constitute a “disability” under the Deferred Stock Plan.
|
|
(g)
|
“
Separation from Service
” means a “separation from service” within the meaning of Treas. Reg. Section 1.409A-1.
|
|
(h)
|
“
Unforeseeable Emergency
” means an “unforeseeable emergency” within the meaning of Treas. Reg. Section 1.409A-3.
|
|
A.
|
Effect of Agreement
: This Agreement relates to the annual grants of Stock to the Director scheduled to be made for the years 20____ through 20__ (specify years) and that were previously deferred by the Director pursuant to a Deferred Restricted Stock Agreement dated _________________, 20____ (the “
Original Deferral Agreement
”).
|
|
|
If the Director wishes to revoke or modify this election, he must submit a written election to do so to the Company’s Chief Financial Officer at least twelve (12) months before the last permissible date for making an additional deferral election pursuant to this Agreement (see paragraph F) , and unless revoked or modified by that date, the election shall become irrevocable at that date.
|
|
B.
|
“
Plan
”: (under which the “Shares” (as defined below) will be issued) Omega Healthcare Investors, Inc.________________ Plan.
|
|
C.
|
“
Deferred Stock Plan
”: Omega Healthcare Investors, Inc. Deferred Stock Plan, to which this Agreement is also subject.
|
|
D.
|
“
Stock Units
”: This Agreement relates to the annual grants of Stock to the Director as specified in paragraph A above.
|
|
|
In lieu of receiving such annual Stock grants, the Director was credited on each annual date that the annual Stock grant would otherwise have been made with a number of Stock Units that is equal to the number of Shares that would otherwise have been granted to the Director as of such annual date (the “
Applicable Annual Grant Date
”). The number of Stock Units was previously and will continue to be increased by the number of Stock Units attributable to the Converted Dividend Equivalents if the Director previously elected. Each Stock Unit represents the Company’s unsecured obligation to issue one share of Stock and the related Deferred Dividend Equivalents or Current Dividend Equivalents (if the Director previously elected). The shares of Stock represented by the Stock Units shall be referred to as the “
Shares
.”
|
|
E.
|
“
Dividend Equivalents
”: Each Stock Unit shall accrue an amount equal to the dividends per share payable on Common Stock to shareholders of record on or after the Applicable Annual Grant Date and through the day before the date the Shares are issued (or until the Stock Units are forfeited, if earlier).
|
|
|
Please check which form you previously elected for the Dividend Equivalents to be paid pursuant to the Original Deferral Agreement (either paragraph 1, 2 or 3 below). You cannot now change your election: |
|
1.
|
[ ]
|
“
Converted Dividend Equivalents
”: The Dividend Equivalents will be converted into a number of Vested Stock Units equal to the amount of the Dividend Equivalents that are accrued as of the dividend payment date, divided by the closing price per share of Stock on the dividend payment date. Such Vested Stock Units shall also accrue future Dividend Equivalents that shall be converted into Vested Stock Units in accordance with the preceding formula. The Stock Units under this paragraph shall be paid on the date the Shares are payable to the Director; or
|
|
2.
|
[ ]
|
“
Deferred Dividend Equivalents
”: The Dividend Equivalents
shall be paid to the
Director, with interest accrued on a quarterly basis at a rate equal to the Company’s average borrowing rate for the preceding calendar quarter, as determined in the sole discretion of the Committee, on the date the Shares are payable to the Director
; or
|
|
3.
|
[ ]
|
“
Current Dividend Equivalents
”: The Dividend Equivalents shall be paid to the Director on the same date that the dividends per share are paid to shareholders.
|
|
F.
|
“
Deferral Period
”: The Director is now electing to defer receipt of the Vested Shares (and Converted Dividend Equivalents or Deferred Dividend Equivalents if paragraph E.1. or E.2. was elected) until the dates or events set forth below:
|
|
1.
|
If you complete this paragraph 1, you must complete A or B below:
|
|
A.
|
[ ]
|
in one lump sum in the month of ___________, 20___ (specify month and year); or
|
|
B.
|
[ ]
|
in annual ratable installments over __ calendar years (specify number of calendar years) with the first payment being made in the month of ___________, 20___ (specify month and year) and each subsequent payment being made in the month of _________ (specify month) of each calendar year thereafter.
|
|
2.
|
If you complete this paragraph 2, you must check A or B below, but not both:
|
|
B.
|
[ ]
|
in the month of _____________ (specify month) of the __________ (specify number, first, second, etc.) calendar year following the calendar year of the Director’s Separation from Service.
|
|
(i)
|
[ ]
|
in one lump sum; or
|
|
(ii)
|
[ ]
|
in annual ratable installments over __ calendar years (specify number of calendar years), with each payment after the first payment being made in the month of ____________ (specify month) of each calendar year.
|
|
3.
|
[ ]
|
the earlier of paragraph 1 or 2 above
|
|
4.
|
[ ]
|
the later of paragraph 1 or 2 above.
|
|
5.
|
[ ]
|
If a Change in Control occurs before the date payment is required to be made pursuant to the elections above, payment shall be made in one lump sum upon the Change in Control (subject to five (5) year additional deferral period described below).
|
|
6.
|
[ ]
|
If the Director becomes subject to a Disability before the date payment is required to be made pursuant to the elections above, payment shall be made in one lump sum upon the Disability.
|
|
(iv)
|
the election shall not take effect until twelve (12) months after the date the written election is submitted to the Company;
|
|
(v)
|
in the case of an election related to a payment date or event other than Disability, the election must defer payment for at least five (5) years from the date such payment would otherwise have been made (i.e., date of lump sum or first installment payment) pursuant to the Original Deferral Agreement, and the election shall be construed and given effect in such manner to require such minimum additional deferral period; and
|
|
(vi)
|
in the case of a payment at a specified date, the election must be submitted at least twelve (12) months before the date payment (i.e., lump sum or first installment payment) was previously scheduled to be made.
|
|
(vii)
|
the election shall not take effect until twelve (12) months after the date the written election is submitted to the Company;
|
|
(viii)
|
in the case of an election related to a payment date or event other than Disability, the election must defer payment for at least five (5) years from the date payment would otherwise have been made (i.e., date of lump sum or first installment payment); and
|
|
(ix)
|
in the case of a payment at a specified date, the election must be submitted at least twelve (12) months before the date payment (i.e., lump sum or first installment payment) was previously scheduled to be made.
|
|
G.
|
“
Vesting Schedule
”: Except as provided in paragraph E.1., the Stock Units and Shares shall vest according to the Vesting Schedule attached hereto as
Exhibit 1
(the “
Vesting Schedule
”). The Stock Units and Shares which have become vested are herein referred to as the “
Vested Stock Units
” and “
Vested Shares
,” respectively.
|
DIRECTOR | OMEGA HEALTHCARE INVESTORS, INC. | ||||
By: |
[Signature] | Title: |
|
(i)
|
“
Change in Control
” means:
|
|
(vii)
|
“A change in the ownership of the corporation,”
|
|
(viii)
|
“A change in the effective control of the corporation,” or
|
|
(ix)
|
“A change in the ownership of a substantial portion of the assets of the corporation,”
|
|
(j)
|
“
Disability
” means any condition that would constitute a “disability” under the Deferred Stock Plan.
|
|
(k)
|
“
Separation from Service
” means a “separation from service” within the meaning of Treas. Reg. Section 1.409A-1.
|
|
(l)
|
“
Unforeseeable Emergency
” means an “unforeseeable emergency” within the meaning of Treas. Reg. Section 1.409A-3.
|
Percentage
|
Vesting Date
|
|||
33-1/3%
|
First anniversary
of
the Grant Date
|
|||
66-2/3%
|
Second anniversary
of the Grant Date
|
|||
100%
|
Third anniversary
of the Grant Date
|
|
|
THIS AGREEMENT (this “ Agreement ”) is made as of _________________, 20____ (the “ Effective Date ”), by Omega Healthcare Investors, Inc. (the “ Company ”) and ____________________________________ (the “ Director ”). |
|
A.
|
Effect of Agreement
: This Agreement relates to the quarterly grants of Stock to the Director that are scheduled to be made after the Effective Date (
including each future year
) as of the quarterly dates set forth in paragraph D below. Therefore, this Agreement shall constitute a standing election to defer such future quarterly Stock grants and shall remain in place until revoked or modified by the Director.
|
|
|
If the Director is making a deferral election within thirty (30) days after the date he first becomes eligible under the Deferred Stock Plan, he may revoke or modify this election for the current year, only if he submits a written election to do so to the Company’s Chief Financial Officer within that same thirty (30) day period and before the date the first quarterly Stock grant is deferred under this Agreement. |
|
|
If the Director wishes to revoke or modify this election as to quarterly Stock grants to be made in a future year, he must submit a written election to do so to the Company’s Chief Financial Officer by December 31 of the preceding year. (So, for example, if the Director elects in January 20__ to defer quarterly Stock grants, if he wishes to elect not to defer quarterly Stock grants in 20__, he must submit a new election by December 31, 20__.) The only exception to the foregoing rules is that if the Director becomes subject to an Unforeseeable Emergency, he may elect to immediately revoke his election to defer future quarterly Stock grants for the current year.
|
|
B.
|
“
Plan
”: (under which the “Shares” (as defined below) will be issued) Omega Healthcare Investors, Inc. ____________________ Plan.
|
|
C.
|
“
Deferred Stock Plan
”: Omega Healthcare Investors, Inc. Deferred Stock Plan, to which this Agreement is also subject.
|
|
D.
|
“
Stock Units
”: This Agreement relates to the quarterly grants of Stock to the Director that are scheduled to be made after the Effective Date (
including each future year
) as of the quarterly dates set forth below.
|
|
The Director should check all of the following quarterly Stock grants which the Director is electing to defer:
|
|
|
In lieu of receiving such quarterly Stock grants, the Director will be credited on each quarterly date selected above with a number of Stock Units that is equal to the number of Shares that would otherwise have been granted to the Director as of such quarterly date (the “ Applicable Quarterly Grant Date ”). The number of Stock Units will be increased by the number of Stock Units attributable to the Converted Dividend Equivalents if the Director elects paragraph E.1. below. Each Stock Unit represents the Company’s unsecured obligation to issue one share of Stock and the related Deferred Dividend Equivalents or Current Dividend Equivalents (if selected in paragraph E) in accordance with this Agreement. The shares of Stock represented by the Stock Units shall be referred to as the “ Shares .” |
|
E.
|
“
Dividend Equivalents
”: Each Stock Unit shall accrue an amount equal to the dividends per share payable on Stock to shareholders of record on or after the Applicable Quarterly Grant Date and through the day before the date the Shares are issued.
|
|
|
You must check either paragraph 1, 2 or 3 below:
|
|
|
1.
|
[ ]
|
“
Converted Dividend Equivalents
”: The Dividend Equivalents will be converted into a number of Stock Units equal to the amount of the Dividend Equivalents that are accrued as of the dividend payment date, divided by the closing price per share of Stock on the dividend payment date. Such Stock Units shall also accrue future Dividend Equivalents that shall be converted into Stock Units in accordance with the preceding formula. The Stock Units under this paragraph shall be paid on the date the Shares are payable to the Director; or
|
|
2.
|
[ ]
|
“
Deferred Dividend Equivalents
”: The Dividend Equivalents
shall be paid to the
Director, with interest accrued on a quarterly basis at a rate equal to the Company’s average borrowing rate for the preceding calendar quarter, as determined in the sole discretion of the Committee, on the date the Shares are payable to the Director
; or
|
|
3.
|
[ ]
|
“
Current Dividend Equivalents
”: The Dividend Equivalents shall be paid to the Director on the same date that the dividends per share are paid to shareholders.
|
|
F.
|
“
Deferral Period
”: The Director has elected to defer receipt of the Shares (and Converted Dividend Equivalents or Deferred Dividend Equivalents if paragraph E.1. or E.2. was elected) until the dates or events set forth below:
|
|
|
You must complete either paragraph 1 or 2 below, but you may complete other paragraphs as well.
|
|
1.
|
If you complete this paragraph 1, you must complete A or B below:
|
A.
|
[ ]
in one lump sum in the month of ___________, 20___ (specify month and year); or
|
B.
|
in annual ratable installments over __ calendar years (specify number of calendar years) with the first payment being made in the month of ___________, 20___ (specify month and year) and each subsequent payment being made in the month of _________ (specify month) of each calendar year thereafter.
|
2.
|
If you complete this paragraph 2, you must check A or B below, but not both:
|
|
A.
|
[ ]
|
upon the Director’s Separation from Service; or
|
|
B.
|
[ ]
|
in the month of _____________ (specify month) of the __________ (specify number, first, second, etc.) calendar year following the calendar year of the Director's Separation from Service.
|
|
The
balance in paragraph 2A or 2B will be paid (check (i) or (ii) but not both):
|
|
(i)
|
[ ]
|
in one lump sum; or
|
|
(ii)
|
[ ]
|
in annual ratable installments over __ calendar years (specify number of calendar years), with each payment after the first payment being made in the month of ____________ (specify month) of each calendar year.
|
|
4.
|
[ ]
|
the later of paragraph 1 or 2 above.
|
|
5.
|
[ ]
|
If a Change in Control occurs before the date payment is required to be made pursuant to the elections above, payment shall be made in one lump sum upon the Change in Control.
|
|
6.
|
[ ]
|
If the Director becomes subject to a Disability before the date payment is required to be made pursuant to the elections above, payment shall be made in one lump sum upon the Disability.
|
|
Notwithstanding the foregoing, the Shares (and Converted Dividend Equivalents or Deferred Dividend Equivalents if paragraph E.1. or E.2. was elected) shall be payable upon the Director’s death.
|
|
(x)
|
the election shall not take effect until twelve (12) months after the date the written election is submitted to the Company;
|
|
(xi)
|
in the case of an election related to a payment date or event other than Disability, the election must defer payment for at least five (5) years from the date payment would otherwise have been made (i.e., date of lump sum or first installment payment); and
|
|
(xii)
|
in the case of a payment at a specified date, the election must be submitted at least twelve (12) months before the date payment (i.e., lump sum or first installment payment) was previously scheduled to be made.
|
DIRECTOR
|
OMEGA HEALTHCARE INVESTORS, INC. | |||||
By:
|
||||||
[Signature] | Title: | |||||
|
(m)
|
“
Change in Control
” means:
|
|
(x)
|
“A change in the ownership of the corporation,”
|
|
(xi)
|
“A change in the effective control of the corporation,” or
|
|
(xii)
|
“A change in the ownership of a substantial portion of the assets of the corporation,”
|
|
(n)
|
“
Disability
” means any condition that would constitute a “disability” under the Deferred Stock Plan.
|
|
(o)
|
“
Separation from Service
” means a “separation from service” within the meaning of Treas. Reg. Section 1.409A-1.
|
|
(p)
|
“
Unforeseeable Emergency
” means an “unforeseeable emergency” within the meaning of Treas. Reg. Section 1.409A-3.
|
|
A.
|
Effect of Agreement
: This Agreement relates to the annual grants of Stock to the Director that are scheduled to be made after the Effective Date (
including each future year
). Therefore, this Agreement shall constitute a standing election to defer such annual Stock grants and shall remain in place until revoked or modified by the Director.
|
|
B.
|
“
Plan
”: (under which the “Shares” (as defined below) will be issued) Omega Healthcare Investors, Inc. _____________________ Plan.
|
|
C.
|
“
Deferred Stock Plan
”: Omega Healthcare Investors, Inc. Deferred Stock Plan, to which this Agreement is also subject.
|
|
D.
|
“
Stock Units
”: This Agreement relates to the annual grants of Stock to the Director that are scheduled to be made after the Effective Date (
including each future year
).
|
|
E.
|
“
Dividend Equivalents
”: Each Stock Unit shall accrue an amount equal to the dividends per share payable on Common Stock to shareholders of record on or after the Applicable Annual Grant Date and through the day before the date the Shares are issued (or until the Stock Units are forfeited, if earlier).
|
|
|
You must check either paragraph 1, 2 or 3 below:
|
|
|
1.
|
[ ]
|
“
Converted Dividend Equivalents
”: The Dividend Equivalents will be converted into a number of Vested Stock Units equal to the amount of the Dividend Equivalents that are accrued as of the dividend payment date, divided by the closing price per share of Stock on the dividend payment date. Such Vested Stock Units shall also accrue future Dividend Equivalents that shall be converted into Vested Stock Units in accordance with the preceding formula. The Stock Units under this paragraph shall be paid on the date the Shares are payable to the Director; or
|
|
2.
|
[ ]
|
“
Deferred Dividend Equivalents
”: The Dividend Equivalents
shall be paid to the
Director, with interest accrued on a quarterly basis at a rate equal to the Company’s average borrowing rate for the preceding calendar quarter, as determined in the sole discretion of the Committee, on the date the Shares are payable to the Director
; or
|
|
3.
|
[ ]
|
“
Current Dividend Equivalents
”: The Dividend Equivalents shall be paid to the Director on the same date that the dividends per share are paid to shareholders.
|
|
F.
|
“
Deferral Period
”: The Director has elected to defer receipt of the Vested Shares (and Converted Dividend Equivalents or Deferred Dividend Equivalents if paragraph E.1. or E.2. was elected) until the dates or events set forth below:
|
1.
|
If you complete this paragraph 1, you must complete A or B below:
|
A.
|
[ ]
in one lump sum in the month of ___________, 20___ (specify month and year); or
|
B.
|
in annual ratable installments over __ calendar years (specify number of calendar years) with the first payment being made in the month of ___________, 20___ (specify month and year) and each subsequent payment being made in the month of _________ (specify month) of each calendar year thereafter.
|
2.
|
If you complete this paragraph 2, you must check A or B below, but not both:
|
|
A.
|
[ ]
|
upon the Director’s Separation from Service; or
|
|
B.
|
[ ]
|
in the month of _____________ (specify month) of the __________ (specify number, first, second, etc.) calendar year following the calendar year of the Director's Separation from Service.
|
|
The
balance in paragraph 2A or 2B will be paid (check (i) or (ii) but not both):
|
|
(i)
|
[ ]
|
in one lump sum; or
|
|
(ii)
|
[ ]
|
in annual ratable installments over __ calendar years (specify number of calendar years), with each payment after the first payment being made in the month of ____________ (specify month) of each calendar year.
|
|
3.
|
[ ]
|
the earlier of paragraph 1 or 2 above.
|
|
4.
|
[ ]
|
the later of paragraph 1 or 2 above.
|
|
5.
|
[ ]
|
If a Change in Control occurs before the date payment is required to be made pursuant to the elections above, payment shall be made in one lump sum upon the Change in Control.
|
|
(xiii)
|
the election shall not take effect until twelve (12) months after the date the written election is submitted to the Company;
|
|
(xiv)
|
in the case of an election related to a payment date or event other than Disability, the election must defer payment for at least five (5) years from the date payment would otherwise have been made (i.e., date of lump sum or first installment payment); and
|
|
(xv)
|
in the case of a payment at a specified date, the election must be submitted at least twelve (12) months before the date payment (i.e. lump sum or first installment payment) was previously scheduled to be made.
|
|
|
Notwithstanding the foregoing, the Vested Shares (and Converted Dividend Equivalents or Deferred Dividend Equivalents if paragraph E.1. or E.2. was elected) shall be payable upon the Director’s death.
|
|
G.
|
“
Vesting Schedule
”: Except as provided in paragraph E.1., the Stock Units and Shares shall vest according to the Vesting Schedule attached hereto as
Exhibit 1
(the “
Vesting Schedule
”). The Stock Units and Shares which have become vested are herein referred to as the “
Vested Stock Units
” and “
Vested Shares
,” respectively.
|
DIRECTOR
|
OMEGA HEALTHCARE INVESTORS, INC. | |||||||
By:
|
|
|||||||
[Signature] | Title: |
|
(q)
|
“
Change in Control
” means:
|
|
(xiii)
|
“A change in the ownership of the corporation,”
|
|
(xiv)
|
“A change in the effective control of the corporation,” or
|
|
(xv)
|
“A change in the ownership of a substantial portion of the assets of the corporation,”
|
|
(r)
|
“
Disability
” means any condition that would constitute a “disability” under the Deferred Stock Plan.
|
|
(s)
|
“
Separation from Service
” means a “separation from service” within the meaning of Treas. Reg. Section 1.409A-1.
|
|
(t)
|
“
Unforeseeable Emergency
” means an “unforeseeable emergency” within the meaning of Treas. Reg. Section 1.409A-3.
|
Percentage
|
Vesting Date
|
|||
33-1/3%
|
First anniversary of
the Grant Date
|
|||
66-2/3%
|
Second anniversary
of the Grant Date
|
|||
100%
|
Third anniversary
of the Grant Date
|
A.
|
Grant Date
: January 1, 201__.
|
B.
|
Plan (under which Restricted Unit Grant is granted)
: Omega Healthcare Investors, Inc. 2004 Stock Incentive Plan.
|
C.
|
Vested Restricted Units
: The Recipient shall earn a number of Vested Restricted Units determined pursuant to
Exhibit 1
. Each Vested Restricted Unit represents the Company’s unsecured obligation to issue one share of the Company’s common stock (“
Common Stock
”) and related Dividend Equivalents (as defined below) in accordance with this Agreement.
|
D.
|
Dividends Equivalents
. Each Vested Restricted Unit shall accrue Dividend Equivalents, an amount equal to the dividends per share paid on one share of Common Stock to a shareholder of record on or after the Grant Date and until the date that the Vested Shares (as defined below) are issued.
|
E.
|
Distribution Date of Vested Shares
. Shares of Common Stock attributable to Vested Restricted Units (“
Vested Shares
”) shall be issued and distributed upon the earlier of the dates listed below, subject to receipt from the Recipient of the required tax withholding:
|
|
a.
|
within ten (10) business days following December 31, 201__; or
|
|
b.
|
the date of a Change in Control.
|
F.
|
Distribution Date of Dividend Equivalents
. Dividend Equivalents attributable to Vested Restricted Units shall be distributed to the Recipient on the same date as Vested Shares are distributable to the Recipient under Item E above, subject to the provisions of any deferral agreement between the Recipient and the Company, whether executed before or after this Agreement.
|
OMEGA HEALTHCARE INVESTORS, INC. | ||||
By: | ||||
Title: |
A.
|
The number of Vested Restricted Units earned is determined as of the last day of the Performance Period pursuant to the following chart; provided that the Recipient must remain an employee, director or consultant of the Company or an Affiliate during the entire Performance Period to earn the number of Vested Restricted Units determined in the chart below.
|
Below
Threshold
Performance
|
*Threshold
Performance |
*Target
Performance
|
*High
Performance
|
Zero
Vested
Units
|
*
|
If Total Shareholder Return falls between Threshold Performance and Target Performance or between Target Performance and High Performance, the number of Vested Restricted Units shall be determined by rounding actual Total Shareholder Return to the closest 0.5% percentage points and then applying linear interpolation based on the percentage points by which Threshold Performance or Target Performance, respectively, as so adjusted, is exceeded.
|
B.
|
Notwithstanding the foregoing, if during the Performance Period and more than sixty (60) days before a Change in Control, the Recipient dies or becomes subject to a Disability while an employee, director or consultant of the Company or an Affiliate, the Recipient resigns from the Company for Good Reason, or the Company terminates the Recipient’s employment without Cause (each such event referred to as a “Qualifying Termination”), the Recipient shall earn a number of Vested Restricted Units equal to the number of Vested Restricted Units determined in the chart above as of the completion of the Performance Period, multiplied by a fraction, the numerator of which is the number of days elapsed in the Performance Period through the date of such event and the denominator of which is 365.
|
C.
|
Notwithstanding the foregoing, if a Change in Control occurs on or after the Grant Date and before December 31, 201__ and (i) while the Recipient remains an employee, director or consultant of the Company or an Affiliate, or (ii) within sixty (60) days before the Change in Control, the Recipient incurs a Qualifying Termination, the Recipient shall earn a number of Vested Restricted Units determined in the chart above based on the level of Total Shareholder Return through the date of the Change in Control relative to the level required for the full Performance Period (determined without regard to the shortening of the period as a result of the Change in Control), and shall not thereafter earn any additional Vested Restricted Units.
|
D.
|
The portion of the Restricted Unit Grant that has not become earned Vested Restricted Units as of the earlier of the last day of the Performance Period, or, except as provided in Item C above, as of the date the Recipient ceases to be an employee, director, or consultant of the Company or an Affiliate shall be forfeited.
|
TO:
|
Omega Healthcare Investors, Inc.
|
|
Attention: Chief Financial Officer
|
FROM:
|
|
|
[ ]
|
the legal representative of the estate of the original recipient of the Restricted Unit Grant.
|
|
[ ]
|
a legatee of the original recipient of the Restricted Unit Grant.
|
|
[ ]
|
the legal guardian of the original recipient of the Restricted Unit Grant.
|
Dated:
|
||
Signature:
|
||
|
||
Name (Printed)
|
||
Street Address | ||
City, State, Zip Code
|
1.
|
I have reviewed this Quarterly Report on Form 10-Q of Omega Healthcare Investors, Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
|
a.
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
|
b.
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
|
c.
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
|
d.
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
|
a.
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
|
b.
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
|
|
/S/ C. TAYLOR PICKETT | |
C. Taylor Pickett | |||
Chief Executive Officer |
1.
|
I have reviewed this Quarterly Report on Form 10-Q of Omega Healthcare Investors, Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
|
a.
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
|
b.
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
|
c.
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
|
d.
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
|
a.
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
|
b.
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
|
|
/S/ ROBERT O. STEPHENSON | |
Robert O. Stephenson | |||
Chief Financial Officer |
|
(1)
|
the Quarterly Report on Form 10-Q of the Company for the three months ended September 30, 2012 (the “Report”) fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and
|
|
(2)
|
the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
/S/
|
C. TAYLOR PICKETT | |
C. Taylor Pickett | ||
Chief Executive Officer |
|
(1)
|
the Quarterly Report on Form 10-Q of the Company for the three months ended September 30, 2012 (the “Report”) fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and
|
|
(2)
|
the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
/S/
|
ROBERT O. STEPHENSON | |
Robert O. Stephenson | ||
Chief Financial Officer |