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Subsequent Events
9 Months Ended
Sep. 30, 2013
Subsequent Events [Abstract]  
Subsequent Events
Subsequent Events
Distributions
On November 7, 2013, the board of directors of the Company approved a daily cash distribution of $0.00184932 per share of common stock for each of the three months ended March 31, 2014. Distributions are generally paid to stockholders on the first day of the month following the month for which the distribution has accrued.
Offering Proceeds
For the period from October 1, 2013 through November 11, 2013, the Company issued 4.6 million shares of common stock pursuant to its Offering generating gross proceeds of $45.7 million.
Sponsor Purchase of Common Stock
On November 7, 2013, the Company's board of directors approved the sale of 8,099 shares of the Company's common stock to the Sponsor pursuant to the Distribution Support Agreement. In connection with this approval and including the shares purchased to satisfy the minimum offering requirement, the Sponsor will have purchased 233,391 shares for $2.1 million
Credit Facility
On November 13, 2013, the Company, through its Operating Partnership, entered into a corporate credit facility agreement with KeyBank National Association, which may provide up to $100.0 million to finance real estate investments and first mortgage loans secured by healthcare real estate (the “Facility”). The initial amount of the Facility is $25.0 million and is subject to increases in accordance with the governing documents. The Facility provides advances up to 65.0%, depending upon the type and characteristics of the individual asset. Facility advances accrue interest at per annum rates of 2.75% to 3.25% above the relevant benchmark, based on the aggregate portfolio leverage.  The initial maturity date of the Facility is November 13, 2016, with a one-year extension at the Company's option, subject to satisfaction of certain conditions. During the initial and extended term, the Facility acts as a revolving credit facility that can be paid down as assets are repaid or sold and re-drawn for new investments.
The Company is required to maintain: (i) a minimum of $2.5 million or $5.0 million in unrestricted cash, depending on its consolidated total assets; and (ii) a tangible net worth equal to the lesser of (a) $25.0 million, subject to increases equal to 80.0% of aggregate net proceeds from the Offering and (b) $250.0 million. The Company is also required to raise a minimum of $20.0 million in additional Offering proceeds per calendar quarter until $150.0 million of total net Offering proceeds have been raised and to maintain (i) a ratio of modified funds from operations, as adjusted, to fixed charges of not less than 1.4x during the first year after the initial borrowing on the Facility, subject to annual increases, and (ii) a ratio of total borrowings to total assets of not greater than 65.0% prior to December 2014 and 60.0% thereafter. In addition, the properties pledged to the Facility must maintain an aggregate minimum occupancy rate. In connection with the Facility, the Company entered into an unconditional guaranty of payment and performance, under which the Company agreed to guaranty the obligations under the Facility.
As of November 13, 2013, the Company had no borrowings outstanding under the Facility. The summary of the Facility and related guaranty described above is qualified in its entirety by reference to the credit facility and guaranty, which are filed as Exhibits 10.4 and 10.5, respectively, to this Form 10-Q.
New Investments
In October 2013, the Company acquired the following equity investments (dollars in millions):
Investment

State

Property Type

Purchase Price (2)
 
Kansas City Portfolio

KS

Memory Care/Assisted Living

$
15.6

 
Peregrine Portfolio (1)

CT/NY

Memory Care/Assisted Living

14.2

 
Total





$
29.8

 
___________________________
(1)
Upon acquisition of a memory care facility for $11.1 million, the Company assumed an existing mortgage note payable of $7.8 million at one-month LIBOR plus 2.75% and maturing on June 1, 2018.
(2)
Includes transaction and other costs.
Independent Directors' Share Grants
On November 7, 2013, pursuant to the Plan, the Company granted 2,500 shares of restricted stock at $9.00 per share to each of the Company's three independent directors. The stock will generally vest over four years.