-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, TR2tzr+b4PT7Qgn2yeY3OrAE5ZRyfH/1O/pDtsdUgzKaKsdgdnpU4bgxO7/od8zo w3QvExhIDMUkRL0V9jnuVg== 0000765880-96-000006.txt : 19960515 0000765880-96-000006.hdr.sgml : 19960515 ACCESSION NUMBER: 0000765880-96-000006 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 4 CONFORMED PERIOD OF REPORT: 19960331 FILED AS OF DATE: 19960514 SROS: NONE FILER: COMPANY DATA: COMPANY CONFORMED NAME: HEALTH CARE PROPERTY INVESTORS INC CENTRAL INDEX KEY: 0000765880 STANDARD INDUSTRIAL CLASSIFICATION: REAL ESTATE INVESTMENT TRUSTS [6798] IRS NUMBER: 330091377 STATE OF INCORPORATION: MD FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 001-08895 FILM NUMBER: 96563065 BUSINESS ADDRESS: STREET 1: 10990 WILSHIRE BLVD STE 1200 CITY: LOS ANGELES STATE: CA ZIP: 90024 BUSINESS PHONE: 3104731990 10-Q 1 UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (MARK ONE) [X] Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934. For the quarterly period ended March 31, 1996. OR [ ] Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934. For the transition period from ..... to ....... Commission file number 1-8895 - ---------------------------------------------------------------------------- HEALTH CARE PROPERTY INVESTORS, INC. (Exact name of registrant as specified in its charter) - ---------------------------------------------------------------------------- Maryland 33-0091377 (State or other jurisdiction of (I.R.S. Employer incorporation of organization) Identification No.) 10990 Wilshire Boulevard, Suite 1200 Los Angeles, California 90024 (Address of principal executive offices) (310) 473-1990 (Registrant's telephone number, including area code) ___________________ Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes [X] No[ ] As of May 10, 1996 there were 28,665,214 shares of $1.00 par value common stock outstanding. - ---------------------------------------------------------------------------- HEALTH CARE PROPERTY INVESTORS, INC. INDEX PART I. FINANCIAL INFORMATION Item 1. Financial Statements: Consolidated Balance Sheets March 31, 1996 and December 31, 1995 Consolidated Statements of Income Three Months Ended March 31, 1996 and 1995 Consolidated Statements of Cash Flows Three Months Ended March 31, 1996 and 1995 Notes to Consolidated Condensed Financial Statements Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations PART II. OTHER INFORMATION Signatures Health Care Property Investors, Inc. Consolidated Balance Sheets (unaudited) (Dollar amounts in thousands) March 31, December 31, 1996 1995 --------- ------------ Assets Real Estate Properties Buildings and Improvements $ 653,700 $ 581,152 Accumulated Depreciation (128,467) (121,983) --------- --------- 525,233 459,169 Construction in Progress 6,553 7,508 Land 65,006 61,317 --------- --------- 596,792 527,994 Loans Receivable 116,515 120,959 Investments in and Advances to Partnerships 9,097 9,248 Other Assets 9,257 7,630 Cash and Cash Equivalents 24,116 2,000 --------- --------- Total Assets $ 755,777 $ 667,831 ========= ========= Liabilities and Stockholders' Equity Bank Notes Payable $ --- $ 31,700 Senior Notes Due 1998-2015 267,344 153,994 Convertible Subordinated Notes Due 2000 100,000 100,000 Mortgage Notes Payable 13,041 13,390 Accounts Payable and Accrued Expenses 16,498 10,568 Minority Interests in Partnerships 18,734 18,719 Commitments Stockholders' Equity: Common Stock 28,655 28,574 Additional Paid-In Capital 355,205 353,166 Cumulative Net Income 333,930 319,329 Cumulative Dividends (377,630) (361,609) --------- --------- Total Stockholders' Equity 340,160 339,460 --------- --------- Total Liabilities and Stockholders' Equity $ 755,777 $ 667,831 ========= ========= See accompanying Notes to Consolidated Condensed Financial Statements and Management's Discussion and Analysis of Financial Condition and Results of Operations. Health Care Property Investors, Inc. Consolidated Statements of Income (unaudited) (Amounts in thousands, except per share amounts) Three Months Ended March 31, ----------------- 1996 1995 ------- ------ Revenue Base Rental Income $ 20,184 $ 17,152 Additional Rental and Interest Income 4,782 4,864 Interest and Other Income 3,977 3,971 Facility Operating Revenue --- 741 -------- -------- 28,943 26,728 -------- -------- Expense Interest Expense 6,293 5,346 Depreciation/Noncash Charges 5,253 4,507 Other Expenses 1,752 1,417 Facility Operating Expense --- 720 -------- -------- 13,298 11,990 -------- -------- Income From Operations 15,645 14,738 Minority Interests (1,044) (982) -------- -------- Net Income $ 14,601 $ 13,756 ======== ======== Net Income Per Share $ 0.51 $ 0.50 ======== ======== Weighted Average Shares Outstanding 28,607 27,751 ======== ======== See accompanying Notes to Consolidated Condensed Financial Statements and Management's Discussion and Analysis of Financial Condition and Results of Operations. Health Care Property Investors, Inc. Consolidated Statements of Cash Flows (unaudited) (Dollar Amounts in Thousands) Three Months Ended March 31, ---------------- 1996 1995 --------- -------- Cash Flows from Operating Activities Net Income $ 14,601 $ 13,756 Real Estate Depreciation 4,700 3,994 Partnership Adjustments (96) (158) --------- --------- Funds From Operations 19,205 17,592 Change in Other Assets/Liabilities 7,221 (640) --------- --------- 26,426 16,952 --------- --------- Cash Flows from Investing Activities Acquisition of Real Estate Properties, Net (75,282) (3,977) Advances Repaid by Partnerships --- 24 Other Investments and Loans 4,882 (450) --------- --------- (70,400) (4,403) --------- --------- Cash Flows from Financing Activities Net Change in Bank Notes Payable (31,700) 1,800 Repayment of Senior Notes --- (75,000) Issuance of Senior Notes due 1998-2015 113,329 26,840 Cash Proceeds from issuing Common Stock 877 47,109 Increase in Minority Interests --- 64 Final Payments on Mortgages --- (280) Periodic Payments on Mortgages (329) (327) Dividends Paid (16,021) (13,926) Other Financing Activities (66) 306 -------- -------- 66,090 (13,414) -------- -------- Net Increase (Decrease) in Cash and Cash Equivalents $ 22,116 $ (865) ======== ======== See accompanying notes to Consolidated Condensed Financial Statements and Management's Discussion and Analysis of Financial Condition and Results of Operations. HEALTH CARE PROPERTY INVESTORS, INC. NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS March 31, 1996 (UNAUDITED) (1) SIGNIFICANT ACCOUNTING POLICIES The unaudited financial information furnished herein, in the opinion of management, reflects all adjustments that are necessary to state fairly the Company's financial position, the results of its operations, and its cash flows. The Company presumes that users of the interim financial information herein have read or have access to the audited financial statements and Management's Discussion and Analysis of Financial Condition and Results of Operations for the preceding fiscal year ended December 31, 1995 and that the adequacy of additional disclosures needed for a fair presentation, except in regard to material contingencies, may be determined in that context. Accordingly, footnotes and other disclosures that would substantially duplicate the disclosures contained in the Company's most recent annual report to security holders have been omitted. The interim financial information contained herein is not necessarily representative of a full year's operations for various reasons including acquisitions, changes in rents, interest rates and the timing of debt and equity financings. These same considerations apply to all year-to-year comparisons. Net Income Per Share Net income per share is calculated by dividing net income by the weighted average common shares outstanding during the period. There were 28,655,214 shares outstanding as of March 31, 1996. Funds From Operations Effective January 1, 1996, the Company adopted the new definition of Funds From Operations prescribed by the National Association of Real Estate Investment Trusts. Funds From Operations is now defined as net income (computed in accordance with generally accepted accounting principles), excluding gains (or losses) from debt restructuring and sales of property, plus real estate depreciation, and after adjustments for unconsolidated partnerships and joint ventures. Adjustments for unconsolidated partnerships and joint ventures are calculated to reflect Funds From Operations on the same basis. Funds From Operations does not represent cash generated from operating activities in accordance with generally accepted accounting principles, is not necessarily indicative of cash available to fund cash needs and should not be considered as an alternative to net income. Funds From Operations for the quarter ended March 31, 1995 have been restated for comparative purposes. (2) MAJOR OPERATORS Listed below are the Company's major operators and the percentage of current revenue from these operators. Percentage of Operators Revenue Total Revenue - ------------ ----------- ------------- Vencor, Inc. ("Vencor") $6,106,000 21% Horizon/CMS Health Corporation 2,510,000 9 Beverly Enterprises, Inc. 2,475,000 9 Tenet Healthcare Corporation ("Tenet") 2,299,000 8 Columbia/HCA Healthcare Corp. 2,077,000 7 Emeritus Corporation 1,749,000 6 HealthSouth Corporation ("HealthSouth") 1,672,000 6 All of the leases with subsidiaries of Tenet, Vencor, and certain leases with HealthSouth are unconditionally guaranteed by Tenet. The guaranteed leases represent 34% of the Company's total revenue for the three months ended March 31, 1996. (3) STOCKHOLDERS' EQUITY The following tabulation is a summary of the activity for the Stockholders' Equity account for the three months ended March 31, 1996 (amounts in thousands):
Common Stock ------------- Par Additional Total Number of Value Paid In Cumulative Cumulative Stockholders' Shares Amount Capital Net Income Dividends Equity - ------------------------------------------------------------------------------------------------------ Balance, December 31,1995 28,574 $28,574 $353,166 $319,329 $(361,609) $339,460 Issuance of Stock, Net 33 33 1,134 1,167 Exercise of Stock Options 48 48 905 953 Net Income 14,601 14,601 Dividends Paid (16,021) (16,021) - ------------------------------------------------------------------------------------------------------ Balance, March 31,1996 28,655 $28,655 $355,205 $333,930 $(377,630) $340,160 =======================================================================================================
(4) COMMITMENTS The Company has outstanding commitments to fund construction costs of approximately $90,000,000 and acquire health care facilities valued at approximately $30,000,000. The Company expects that most of these commitments totaling approximately $120,000,000 will be funded but that some, due to various reasons including utilization of other financing sources or inability to obtain required internal or governmental approvals, will not be funded. (5) SUBSEQUENT EVENTS On April 25, 1996 the Board of Directors declared a quarterly dividend of $0.57 per share payable on May 20, 1996, to stockholders of record on the close of business on May 3,1996. HEALTH CARE PROPERTY INVESTORS, INC. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS GENERAL The Company is in the business of acquiring health care facilities that it leases on a long term basis to health care providers. On a more limited basis, the Company has provided mortgage financing on health care facilities. As of March 31, 1996, the Company's portfolio of properties, including equity investments, consisted of 206 facilities located in 37 states. These facilities are comprised of 137 long term care facilities, 42 congregate care and assisted living facilities, 12 medical office buildings, six acute care hospitals, six rehabilitation facilities, two physician group practice clinics and one psychiatric care facility. The gross acquisition price of the properties, which includes partnership acquisitions, was approximately $873,578,000 at March 31, 1996. During the quarter ended March 31, 1996, the Company expended approximately $68,000,000 on investments in health care facilities. As of March 31, 1996, the Company had commitments to purchase and construct health care facilities totaling approximately $120,000,000 for funding during 1996 and 1997. LIQUIDITY AND CAPITAL RESOURCES The Company has financed acquisitions through the sale of common stock, the issuance of long term debt, the assumption of mortgage debt, the use of short-term bank lines and through internally generated cash flow. Facilities under construction are generally financed by means of cash on hand or short term borrowings under the Company's existing bank lines. In the future, the Company may use its Medium- Term Note ("MTN") program to finance a portion of the costs of construction. At the completion of construction and commencement of the lease, short term borrowings used in the construction phase are generally refinanced with new long term debt or equity offerings. On February 15, 1996, the Company issued $115,000,000 in Unsecured Senior Notes due 2006 bearing a coupon of 6.5%. The majority of the proceeds from this debt issuance was used to fund acquisitions made during the second half of 1995 and for the first quarter of 1996 with the balance invested temporarily in short term investments pending deployment in long term asset acquisitions. At March 31,1996, stockholders' equity in the Company totaled $340,160,000 and the debt to equity ratio was 1.12 to 1. For the three months ended March 31, 1996, Funds From Operations covered interest expense 4.1 to 1. At March 31, 1996, the Company had approximately $50,975,000 available under its Medium Term Note Program registered pursuant to a shelf registration statement for future issuance of MTNs from time to time based on Company needs and then existing market conditions. In September, 1995, the Company registered $200,000,000 of debt and equity securities under a shelf registration statement filed with the Securities and Exchange Commission of which $85,000,000 in debt or equity securities remains available to be offered by the Company. As of March 31, 1996, the Company had $100,000,000 available on its revolving line of credit. This line of credit with a group of seven domestic and international banks expires on March 31, 1999. The Company's Senior and Convertible Subordinated Notes have been rated investment grade by debt rating agencies since 1986. Current ratings are as follows: Moody's Standard & Poor's Duff & Phelps ---------- -------------------- ------------- - - Senior Notes Baa1 BBB+ A- Convertible Subordinated Notes Baa2 BBB BBB+ Since inception in May 1985, the Company has recorded approximately $449,459,000 in cumulative Funds From Operations. Of this amount, a total of $377,630,000 has been distributed to stockholders as dividends. The balance of $71,829,000 has been retained, and is an additional source of capital for the Company. At March 31, 1996, the Company had approximately $30,700,000 in irrevocable letters of credit from commercial banks to secure the obligations of many lessees' lease and borrowers' loan obligations. The Company may draw upon the letters of credit if there are any defaults under the leases and/or loans. Amounts available under letters of credit change from time to time; such changes may be material. The first quarter 1996 dividend of $0.56 per share or $16,021,000 in the aggregate was paid on February 20, 1996. Total dividends paid during the three months ended March 31,1996 as a percentage of Funds From Operations for the corresponding period was 83%. The Company declared a second quarter dividend of $0.57 per share or $16,300,000 in the aggregate, to be paid on May 20, 1996. Management believes that the Company's liquidity and sources of capital are adequate to finance its operations as well as its future investments in additional facilities. RESULTS OF OPERATIONS Net Income for the three months ended March 31, 1996 totaled $14,601,000 or $0.51 per share, on revenues of $28,943,000 compared to Net Income of $13,756,000 or $0.50 per share, on revenues of $26,728,000 for the corresponding quarter in 1995. Funds From Operations for the three months ended March 31, 1996, increased to $19,205,000, compared with $17,592,000 for the corresponding period in the prior year. Earnings and Funds From Operations were significantly higher than a year ago due to increases in base rents and lower relative financing costs. Base rents for the three months ended March 31, 1996, increased by $3,032,000 over the corresponding period in 1995 from $17,152,000 to $20,184,000. The majority of the increase in base rents came from new long term investments made in 1995 and the first quarter of 1996 of $102,000,000 and $68,000,000, respectively. Interest expense was higher due to the increase in average borrowings as a result of the issuance of Senior Notes as mentioned above. PART II. OTHER INFORMATION Item 6. Exhibits and Reports on Form 8-K -------------------------------- a) Exhibits: EX-27 Financial Data Schedule EX-10.40 Amended and Restated Director Deferred Compensation Plan EX-10.41 Letter from The Bank of New York and banks that are signatories to Revolving Credit Agreement extending commitment. b) Reports on Form 8-K: A report on Form 8-K was filed on February 20, 1996, relating to the Company's 6.5% Senior Notes due February 15,2006. SIGNATURES 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. Date: May 10, 1996 HEALTH CARE PROPERTY INVESTORS, INC. (REGISTRANT) /s/ James G. Reynolds ---------------------------------- James G. Reynolds Executive Vice President and Chief Financial Officer (Principal Financial Officer) /s/ Devasis Ghose ---------------------------------- Devasis Ghose Senior Vice President-Finance and Treasurer (Principal Accounting Officer) EX-27 2
5 0000765880 HEALTH CARE PROPERTY INVESTORS, INC. 1,000 3-MOS DEC-31-1996 MAR-31-1996 24,116 0 0 0 0 0 725,259 128,467 755,777 0 380,385 28,655 0 0 311,505 755,777 0 28,943 0 6,297 1,752 0 6,293 14,601 0 14,601 0 0 0 14,601 0.51 0.51
EX-1 3 EXHIBIT 10.40 HEALTH CARE PROPERTY INVESTORS, INC. AMENDED AND RESTATED DIRECTOR DEFERRED COMPENSATION PLAN 1. Eligibility. Each member of the Board of Directors (the "Board") of Health Care Property Investors, Inc. (the "Company") who is not an employee of the Company (a "Director") shall be eligible to participate in this Amended and Restated Director Deferred Compensation Plan of the Company (the "Plan"), pursuant to the terms and conditions described herein. 2. Participation. (a) On the date of adoption of the Plan and at any time thereafter, a Director may elect to participate in the Plan by directing that all or any portion of the compensation which the Director may thereafter earn for services as a Director (including the Director's retainer and any fees payable for services as a member of a committee of the Board) shall be credited to a deferred compensation account or accounts subject to the terms of the Plan. Any Director who elects to participate in the Plan is hereinafter referred to as a "Participant". (b) A Director's election to defer the Director's fees shall be in the form of a document, similar to Exhibit A-1 attached, executed by a Director and shall become effective at the first day of the fiscal quarter beginning immediately following the date on which the Company receives such notice, or on the first day of such later fiscal quarter as may be designated in the notice of election to defer compensation. "Fiscal quarter" shall mean any quarter of the fiscal year adopted by the Company for reporting its financial condition and operating results. (c) A Director's election to defer compensation under the Plan shall continue in effect until the Director ceases to be a Director, or until the date the Director terminates such election, in whole or in part, by written notice filed with the Company. Any such termination, in whole or in part, shall become effective at the close of the fiscal quarter ending immediately following the date on which the Company receives such notice, or at the end of such later fiscal quarter as may be designated in the notice of termination. (d) A Participant who has filed an election to terminate deferrals of compensation under the Plan may thereafter file an election to recommence such deferrals with respect to any future compensation earned by him for services to the Company or any subsidiary thereof pursuant to the foregoing provisions of the Plan. 3. Deferred Compensation Accounts. (a) All deferred compensation amounts shall be held by the Company in its general funds, shall be credited to an account or accounts, as applicable, in the name of each Participant and shall earn a rate of return, as described herein. (b) Upon electing to defer compensation under the Plan, each Participant shall designate the amount of such compensation which shall be credited to the Participant's "Interest Rate Account" or "Stock Credit Account", as follows: (i) Interest Rate Account: The Participant's Interest Rate Account shall be credited, as of the date on which the Participant would otherwise have been entitled to receive such deferred compensation, with the amount of compensation directed to be deferred and credited to the Participant's Interest Rate Account. Based on the Participant's deferred compensation Interest Rate Account balance at the beginning of each fiscal quarter, the Participant's Interest Rate Account shall be credited at the end of each fiscal quarter with an interest equivalent to be calculated quarterly on the basis of one quarter of the percentage rate which is equal to one point below the prime interest rate charged by Bank of New York on the last day of the fiscal quarter or such other rate as may be set from time to time by the Compensation Committee of the Board of Directors of the Company (the "Committee"). (ii) Stock Credit Account: The Participant's Stock Credit Account shall be credited, as of the payment date for regular quarterly dividends paid to holders of the Company's Common Stock ("Common Stock") during the fiscal quarter during which the Participant would otherwise have been entitled to receive such deferred compensation, with a number of units equal to the number of shares of Common Stock (including fractions of units reflecting fractions of shares) that could have been purchased at the average of the closing price of Common Stock (as reported in The Wall Street Journal, "Closing Price") on each business day during the immediately preceding 10 business days (the "Average Closing Price") with the amount of compensation directed to be deferred and credited to Participant's Stock Credit Account. In addition, as of the date any dividend is paid to holders of Common Stock, the Participant's Stock Credit Account shall also be credited with an additional number of units equal to the number of shares of Common Stock (including fractions of units reflecting fractions of shares) that could have been purchased at the Average Closing Price of Common Stock as of such date with the dividend paid on the number of shares of Common Stock to which the Participant's Stock Credit Account is then equivalent (but not taking into account any units credited the same day pursuant to the first sentence of this Section 3(b)(ii)). In case of any dividends paid in property, the dividend shall be deemed to be the fair market value of the property at the time of distribution of the dividend, as determined by the Committee. If at any time the number of outstanding shares of Common Stock shall be increased as the result of any stock dividend, subdivision or reclassification of shares, the number of shares of Common Stock to which each Participant's Stock Credit Account is equivalent shall be increased in the same proportion as the outstanding number of shares of Common Stock is increased, or if the number of outstanding shares of Common Stock shall at any time be decreased as the result of any combination or reclassification of shares, the number of shares of Common Stock to which each Participant's Stock Credit Account is equivalent shall be decreased in the same proportion as the outstanding number of shares of Common Stock is decreased. In the event the Company shall at any time be consolidated with or merged into any other corporation and holders of the Company's Common Stock receive common shares of the resulting or surviving corporation, there shall be credited to each Participant's Stock Credit Account, in place of the shares then credited thereto, a stock equivalent determined by multiplying the number of common shares of stock given in exchange for a share of Common Stock upon such consolidation or merger, by the number of shares of Common Stock to which the Participant's account is then equivalent. If in such a consolidation or merger, holders of the Company's Common Stock shall receive any consideration other than common shares of the resulting or surviving corporation, the Committee shall determine the appropriate change in Participants' accounts. At any given time, the cash equivalent balance of a Participant's Stock Credit Account shall be determined by multiplying the number of credited shares in the Participant's Stock Credit Account by the Average Closing Price as of such date for such shares of stock. (c) Deferred compensation amounts deferred by Participants under the Plan prior to the effective date of this amendment and restatement of the Plan shall continue to be held in each Participant's Interest Rate Account until such time as the Participant may elect to have all or part of such amounts reallocated to the Stock Credit Account. An election to reallocate such account balance shall be in the form of a document, similar to Exhibit A-2 attached, executed by the Participant and filed with the Company, and shall become effective as of the first day of the fiscal quarter beginning immediately following the date on which the Company receives such notice, or at the beginning of such later fiscal quarter as may be designated in the notice. The calculation of units to be credited to the Participant's Stock Credit Account shall be based upon the Average Closing Price as of the effective date of such election. (d) Participants may at any time by written notice filed with the Company reallocate the balances held in their deferred compensation accounts between the Participant's Interest Rate Account and Stock Credit Account, or may change the account to which future deferrals shall be credited. Any such change shall become effective on the first day of the fiscal quarter beginning immediately following the date on which the Company receives such notice, or at the beginning of any later fiscal quarter as may be designated in such notice. The calculation of units to be reallocated to or from the Participant's Stock Credit Account shall be based upon the Average Closing Price as of the effective date of such election. 4. Events Causing Distribution. A Participant's deferred compensation accounts shall become distributable upon the first to occur of any of the following events: (a) The termination of the Participant's membership on the Board; (b) The death of the Participant; (c) The total and permanent incapacity of the Participant, due to physical impairment or legally established mental incompetence, to perform the usual duties of a member of the Board, which disability shall be determined on the basis of (i) medical evidence by a licensed physician designated by the Company or (ii) evidence that the Participant has become entitled to receive primary benefits as a disabled employee under the Social Security Act in effect on the date of such disability; (d) The occurrence of an unforeseeable emergency caused by accident, illness or other causes beyond the control of the Participant which results, in the sole judgment of the Committee, in substantial hardship to the Participant. Any distribution pursuant to this Section 4(d) shall be in an amount not greater than the amount necessary, in the sole judgment of the Committee, to alleviate any hardship caused to the Participant by reason of such emergency; or (e) Such earlier date as may be specified by the Participant at the time he elects to participate in the Plan. 5. Form of Distribution. (a) Interest Rate Account: Deferred compensation credited to the Interest Rate Account, together with accumulated interest, will be distributed to the Participant in 36 approximately equal monthly payments, unless the Committee, in its sole discretion, determines, upon written request of the Participant, that payment shall be made over a shorter period, in a lump sum, or in a partial lump sum with the remainder to be distributed in 36 approximately equal monthly payments. Payment shall commence 30 days after the occurrence of the event causing distribution, with interest continuing to accrue pursuant to Section 3(b) hereof until the full amount of deferred compensation in the Interest Rate Account is paid. (b) Stock Credit Account: Distribution of a Participant's Stock Credit Account shall be made in cash to the Participant in 36 approximately equal monthly payments, unless the Committee, in its sole discretion, determines, upon written request of the Participant, that payment shall be made over a shorter period, in a lump sum, or in a partial lump sum with the remainder to be distributed in 36 approximately equal monthly payments. The amount of each distribution payment shall be the cash equivalent equal to the Average Closing Price as of such payment date multiplied by the number of credited shares to be distributed for such payment. The number of credited shares to be distributed shall equal the credited share balance of the Participant's Stock Credit Account multiplied by a fraction, the numerator of which is one, and the denominator of which is the number of installments yet to be paid to the Participant. Payment shall commence 30 days after the occurrence of the event causing distribution. The number of credited shares distributed as a cash equivalent payment to the Participant shall be debited from the Participant's Stock Credit Account balance, and the Stock Credit Account shall continue to accrue pursuant to Section 3(b) hereof until the full amount of deferred compensation in the Stock Credit Account is paid. 6. Designation of Beneficiary. Each Participant may designate, by a form similar to Exhibit B attached, a beneficiary to receive distribution of the Participant's deferred compensation accounts if the Participant is not living when any portion of such compensation becomes distributable. If the Participant fails to designate a beneficiary, or if the Participant's designated beneficiary does not survive until the time when any portion of the Participant's deferred compensation becomes distributable, such portion of the Participant's deferred compensation shall be paid in a lump sum to the Participant's estate within 120 days immediately following the date of the Participant's death. 7. Miscellaneous. (a) The Participant's deferred compensation accounts under the Plan shall not be assignable by the Participant and shall not be subject to attachment, lien, levy, or other creditors' rights under state or Federal law. (b) All funds or assets, together with all interest, accumulations and increments thereon, of the deferred compensation of all Participants shall remain the funds and assets of the Company, and shall be subject to the Company's absolute ownership and control until the time when such funds or assets are distributed in accordance herewith. The obligation of the Company to Participants hereunder is a contractual obligation only, and the Participants shall have no preferred or specific interest, by way of trust, escrow, annuity or otherwise, in and to any specific assets or funds of the Company. (c) Copies of the Plan and any and all amendments thereto shall be made available to eligible Participants at all reasonable times at the office of the Corporate Secretary of the Company. All notices to the Company hereunder shall be filed with the Corporate Secretary of the Company. (d) The Plan may be amended prospectively, from time to time, by the Committee, and the interest rate applicable hereunder may be increased or decreased prospectively (including with respect to amounts of compensation previously deferred by the Participants) by the Committee as provided in Section 3 hereof, but no amendment shall, in any event, be made to the Plan which would reduce the amounts already earned by any Participant or change the date or provisions for distribution of such amounts, unless the Participant consents in writing to such amendment insofar as the amendment affects the Participant. The foregoing Amended and Restated Director Deferred Compensation Plan is approved by the Board of Directors of the Company on behalf of the Company on January 24, 1996, and shall be effective as of April 1, 1996. _______________________________ Kenneth B. Roath Chairman and Director _______________________________ Orville L. Melby Director and Chairman of the Compensation Committee _______________________________ Edward J. Henning Corporate Secretary EXHIBIT A-1 HEALTH CARE PROPERTY INVESTORS, INC. NOTICE OF ELECTION TO DEFER COMPENSATION Pursuant to the terms of the Amended and Restated Director Deferred Compensation Plan (the "Plan") of Health Care Property Investors, Inc. (the "Company") adopted at the meeting of the Board of Directors held on January 24, 1996, at which a quorum was present and at all times acting, I hereby elect to defer compensation, as specified below, under the Plan. Capitalized terms not defined herein shall have the meaning described in the Plan. I hereby elect to defer __________ (enter "all" or "none" or state dollar amount or state percentage) that will hereafter be payable to me as a member of the Board of Directors on and after _________________________. Of such deferred amount, __________ (enter "all" or "none" or state dollar amount or state percentage) shall be credited to my Interest Rate Account, the remainder, if any, shall be credited to my Stock Credit Account, as provided for in Section 3(b) of the Plan. These elections shall continue in effect until such time as I file a written notice with the Corporate Secretary of the Company, or I cease to be eligible to participate in the Plan. In the event of my death, all amounts deferred pursuant to this Plan, together with accumulated earnings, less any amounts paid out from my account, shall be payable in full to my named beneficiary, if he or she survives me, or to my estate 120 days following the date of my death. I hereby specify _________________________ (enter date or the words "no date") as an "Event Causing Distribution" in connection with section 4(e) of the Plan and no compensation shall be deferred after such date. __________ _______________________________ Date Signature of Director _______________________________ Print:Name _______________________________ Social Security Number __________ _______________________________ Date Spouses's Signature _______________________________ Print: Name Received: __________ _______________________________ Date , Corporate Secretary EXHIBIT A-2 HEALTH CARE PROPERTY INVESTORS, INC. NOTICE OF ELECTION TO TRANSFER DEFERRED COMPENSATION Pursuant to the terms of the Amended and Restated Director Deferred Compensation Plan (the "Plan") of Health Care Property Investors, Inc. (the "Company") adopted at the meeting of the Board of Directors held on January 24, 1996, at which a quorum was present and at all times acting, I hereby elect to reallocate the crediting of my account balance in the Plan. Of the amounted credited to my account under the Plan, __________ (enter "all" or "none" or state dollar amount or state percentage) shall be invested in the Interest Rate Account, the remainder, if any, shall be invested in the Stock Credit Account, as provided for in Section 3(b) of the Plan. All transferred amounts shall be subject to the terms and conditions of the Plan. __________ _______________________________ Date Signature of Director _______________________________ Print:Name _______________________________ Social Security Number __________ _______________________________ Date Spouses's Signature _______________________________ Print: Name Received: __________ _______________________________ Date , Corporate Secretary EXHIBIT B HEALTH CARE PROPERTY INVESTORS, INC. BENEFICIARY DESIGNATION AMENDED AND RESTATED DIRECTOR DEFERRED COMPENSATION PLAN I designate the following beneficiary or beneficiaries to receive payment, in the event of my death, of my interest in any deferred compensation heretofore or hereafter payable to me pursuant to Health Care Property Investors, Inc.'s Amended and Restated Director Deferred Compensation Plan (please see "Instructions for Naming the Beneficiary" that accompany this form): PRIMARY BENEFICIARY OR BENEFICIARIES AGE RELATIONSHIP ADDRESS SUCCESSOR BENEFICIARY OR BENEFICIARIES AGE RELATIONSHIP ADDRESS I reserve the right to change any beneficiary from time to time by filing with the Company a new election on this form. I agree that the last designation received by the Company prior to my death shall control any testamentary or other disposition I may make; however, if a former spouse is one of the beneficiaries named above but is not my spouse at the time of my death, such designation shall be deemed revoked. I acknowledge that this designation is subject to laws in the state of my residence. I further agree that the Company may make a lump sum payment to the legal representative of my estate if there is any question as to the right of any beneficiary to take hereunder, and the Company, its directors, the Compensation Committee and any member thereof, and any employee of the Company, shall have no further liability with respect hereto. __________ _______________________________ Date Signature of Director _______________________________ Print:Name __________ _______________________________ Date Spouses's Signature _______________________________ Print: Name EX-2 4 Exhibit 10.41 January 29, 1996 Ms. Lisa Y. Brown Vice President The Bank of New York, as Agent 10990 Wilshire Blvd., Suite 1700 Los Angeles, CA 90024 Dear Lisa: Pursuant to Section 11.12 of the Revolving Credit Agreement dated as of March 31, 1994 among Health Care Property Investors, Inc., certain Banks as indicated in the Revolving Credit Agreement and The Bank of New York as agent, we would request that all banks that are party to the agreement extend the Termination Date of the Agreement by one calendar year to March 31, 1999. Please indicate your agreement to such one year extension by signing the two enclosed copies of this letter and sending both original copies to The Bank of New York prior to February 28, 1996. Please do not hesitate to call me if you need any additional information. Yours sincerely, /s/ Dev Ghose ------------------------------------ Dev Ghose Senior Vice President-Finance and Treasurer Agreement to extend Termination Date by one calendar year to March 31, 1999. The Bank of New York Long-Term Credit Bank of Japan, Ltd. By: /s/ Lisa Y. Brown By: /s/ Yutaka Kamisawa --------------------- ------------------------- Its: Vice President Its: Deputy General Manager --------------------- ------------------------- January 29, 1996 Ms. Lisa Y. Brown Vice President The Bank of New York, as Agent 10990 Wilshire Blvd., Suite 1700 Los Angeles, CA 90024 Dear Lisa: Pursuant to Section 11.12 of the Revolving Credit Agreement dated as of March 31, 1994 among Health Care Property Investors, Inc., certain Banks as indicated in the Revolving Credit Agreement and The Bank of New York as agent, we would request that all banks that are party to the agreement extend the Termination Date of the Agreement by one calendar year to March 31, 1999. Please indicate your agreement to such one year extension by signing the two enclosed copies of this letter and sending both original copies to The Bank of New York prior to February 28, 1996. Please do not hesitate to call me if you need any additional information. Yours sincerely, /s/ Dev Ghose -------------------------- Dev Ghose Senior Vice President-Finance and Treasurer Agreement to extend Termination Date by one calendar year to March 31, 1999. The Bank of New York Sanwa Bank of California By: /s/ Lisa Y. Brown By: /s/ John Marder ---------------------- --------------------- Its: Vice President Its: Vice President --------------------- --------------------- January 29, 1996 Ms. Lisa Y. Brown Vice President The Bank of New York, as Agent 10990 Wilshire Blvd., Suite 1700 Los Angeles, CA 90024 Dear Lisa: Pursuant to Section 11.12 of the Revolving Credit Agreement dated a of March 31, 1994 among Health Care Property Investors, Inc., certain Banks as indicated in the Revolving Credit Agreement and The Bank of New York as agent, we would request that all banks that are party to the agreement extend the Termination Date of the Agreement by one calendar year to March 31, 1999. Please indicate your agreement to such one year extension by signing the two enclosed copies of this letter and sending both original copies to The Bank of New York prior to February 28, 1996. Please do not hesitate to call me if you need any additional information. Yours sincerely, /s/ Dev Ghose -------------------------- Dev Ghose Senior Vice President-Finance and Treasurer Agreement to extend Termination Date by one calendar year to March 31, 1999. The Bank of New York Kredietbank NV By: /s/ Lisa Y. Brown By: /s/ Katherine S. McCarthy -------------------------- ----------------------- By: /s/ Robert Snauffer ----------------------- Its: Vice President Its: Vice President ----------------------- ----------------------- Its: Vice President ----------------------- January 29, 1996 Ms. Lisa Y. Brown Vice President The Bank of New York, as Agent 10990 Wilshire Blvd., Suite 1700 Los Angeles, CA 90024 Dear Lisa: Pursuant to Section 11.12 of the Revolving Credit Agreement dated as of March 31, 1994 among Health Care Property Investors, Inc., certain Banks as indicated in the Revolving Credit Agreement and The Bank of New York as agent, we would request that all banks that are party to the agreement extend the Termination Date of the Agreement by one calendar year to March 31, 1999. Please indicate your agreement to such one year extension by signing the two enclosed copies of this letter and sending both original copies to The Bank of New York prior to February 28, 1996. Please do not hesitate to call me if you need any additional information. Yours sincerely, /s/ Dev Ghose -------------------------- Dev Ghose Senior Vice President-Finance and Treasurer Agreement to extend Termination Date by one calendar year to March 31, 1999. The Bank of New York NationsBank By: /s/ Lisa Y. Brown By: /s/ Brad W. DeSpain -------------------- ------------------------ Its: Vice President Its: Vice President -------------------- ------------------------- January 29, 1996 Ms. Lisa Y. Brown Vice President The Bank of New York, as Agent 10990 Wilshire Blvd., Suite 1700 Los Angeles, CA 90024 Dear Lisa: Pursuant to Section 11.12 of the Revolving Credit Agreement dated as of March 31, 1994 among Health Care Property Investors, Inc., certain Banks as indicated in the Revolving Credit Agreement and The Bank of New York as agent, we would request that all banks that are party to the agreement extend the Termination Date of the Agreement by one calendar year to March 31, 1999. Please indicate your agreement to such one year extension by signing the two enclosed copies of this letter and sending both original copies to The Bank of New York prior to February 28, 1996. Please do not hesitate to call me if you need any additional information. Yours sincerely, /s/ Dev Ghose -------------------------- Dev Ghose Senior Vice President-Finance and Treasurer Agreement to extend Termination Date by one calendar year to March 31, 1999. The Bank of New York Bank of Hawaii By: /s/ Lisa Y. Brown By: /s/ Susan McCarthy ---------------------- ------------------------ Its: Vice President Its: Assistant Vice President ---------------------- ------------------------ January 29, 1996 Ms. Lisa Y. Brown Vice President The Bank of New York, as Agent 10990 Wilshire Blvd., Suite 1700 Los Angeles, CA 90024 Dear Lisa: Pursuant to Section 11.12 of the Revolving Credit Agreement dated as of March 31, 1994 among Health Care Property Investors, Inc., certain Banks as indicated in the Revolving Credit Agreement and The Bank of New York as agent, we would request that all banks that are party to the agreement extend the Termination Date of the Agreement by one calendar year to March 31, 1999. Please indicate your agreement to such one year extension by signing the two enclosed copies of this letter and sending both original copies to The Bank of New York prior to February 28, 1996. Please do not hesitate to call me if you need any additional information. Yours sincerely, /s/ Dev Ghose -------------------------- Dev Ghose Senior Vice President-Finance and Treasurer Agreement to extend Termination Date by one calendar year to March 31, 1999. The Bank of New York Wells Fargo Bank By: /s/ Lisa Y. Brown By: /s/ Brian O'Melveny ------------------------ -------------------------- Its: Vice President Its: Vice President ------------------------ --------------------------- January 29, 1996 Ms. Lisa Y. Brown Vice President The Bank of New York, as Agent 10990 Wilshire Blvd., Suite 1700 Los Angeles, CA 90024 Dear Lisa: Pursuant to Section 11.12 of the Revolving Credit Agreement dated as of March 31, 1994 among Health Care Property Investors, Inc., certain Banks as indicated in the Revolving Credit Agreement and The Bank of New York as agent, we would request that all banks that are party to the agreement extend the Termination Date of the Agreement by one calendar year to March 31, 1999. Please indicate your agreement to such one year extension by signing the two enclosed copies of this letter and sending both original copies to The Bank of New York prior to February 28, 1996. Please do not hesitate to call me if you need any additional information. Yours sincerely, /s/ Dev Ghose -------------------------- Dev Ghose Senior Vice President-Finance and Treasurer Agreement to extend Termination Date by one calendar year to March 31, 1999. The Bank of New York By: /s/ Lisa Y. Brown --------------------------- Its: Vice President --------------------------- -----END PRIVACY-ENHANCED MESSAGE-----