-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: keymaster@town.hall.org Originator-Key-Asymmetric: MFkwCgYEVQgBAQICAgADSwAwSAJBALeWW4xDV4i7+b6+UyPn5RtObb1cJ7VkACDq pKb9/DClgTKIm08lCfoilvi9Wl4SODbR1+1waHhiGmeZO8OdgLUCAwEAAQ== MIC-Info: RSA-MD5,RSA, JshmVR7ZsubYWS3snu5RPo2wbXdwN4m8XLa4KfEFSjHdCJLuHtys2luGut/orDt+ 3O0KofCFa+1TGZJcRAOxMw== 0000898430-94-000348.txt : 19940520 0000898430-94-000348.hdr.sgml : 19940520 ACCESSION NUMBER: 0000898430-94-000348 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19940331 FILED AS OF DATE: 19940513 FILER: COMPANY DATA: COMPANY CONFORMED NAME: NATIONWIDE HEALTH PROPERTIES INC CENTRAL INDEX KEY: 0000780053 STANDARD INDUSTRIAL CLASSIFICATION: 6798 IRS NUMBER: 953997619 STATE OF INCORPORATION: MD FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 001-09028 FILM NUMBER: 94527729 BUSINESS ADDRESS: STREET 1: 4675 MACARTHUR COURT STE 1170 CITY: NEWPORT BEACH STATE: CA ZIP: 92660 BUSINESS PHONE: 7142511211 MAIL ADDRESS: STREET 1: 4675 MACARTHUR COURT STREET 2: STE 1170 CITY: NEWSPORT BEACH STATE: CA ZIP: 92660 FORMER COMPANY: FORMER CONFORMED NAME: BEVERLY INVESTMENT PROPERTIES INC DATE OF NAME CHANGE: 19890515 10-Q 1 FORM 10-Q - - -------------------------------------------------------------------------------- - - -------------------------------------------------------------------------------- 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, 1994 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 1-9028 NATIONWIDE HEALTH PROPERTIES, INC. - - ------------------------------------------------------------------------------- (EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER) MARYLAND 95-3997619 - - ------------------------------------------------------------------------------- (STATE OR OTHER JURISDICTION OF (I.R.S EMPLOYER INCORPORATION OR ORGANIZATION) IDENTIFICATION NUMBER) 4675 MACARTHUR COURT, SUITE 1170 NEWPORT BEACH, CALIFORNIA 92660 - - ------------------------------------------------------------------------------- (ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (714) 251-1211 - - ------------------------------------------------------------------------------- (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 --- --- Shares of registrant's common stock, $.10 par value, outstanding at April 30, 1994--18,172,692. - - -------------------------------------------------------------------------------- - - -------------------------------------------------------------------------------- NATIONWIDE HEALTH PROPERTIES, INC. FORM 10-Q MARCH 31, 1994 TABLE OF CONTENTS PART I--FINANCIAL INFORMATION
PAGE ---- Item 1. Financial Statements Condensed Consolidated Balance Sheets............................... 2 Condensed Consolidated Statements of Operations..................... 3 Condensed Consolidated Statements of Cash Flows..................... 4 Notes to Condensed Consolidated Financial Statements................ 5 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations........................................... 6 PART II--OTHER INFORMATION Item 6. Exhibits and Reports on Form 8-K............................... 7
1 PART I NATIONWIDE HEALTH PROPERTIES, INC. CONDENSED CONSOLIDATED BALANCE SHEETS ASSETS
MARCH 31, DECEMBER 31, 1994 1993 ----------- ------------ (UNAUDITED) (DOLLARS IN THOUSANDS) Investments in real estate Real estate properties: Land........................................... $ 33,943 $ 33,441 Buildings and improvements..................... 370,163 361,909 -------- -------- 404,106 395,350 Less accumulated depreciation.................. (52,960) (50,180) -------- -------- 351,146 345,170 Mortgage loans receivable, net................... 101,205 83,303 -------- -------- 452,351 428,473 Cash and cash equivalents.......................... 2,947 3,627 Receivables........................................ 2,787 2,854 Other assets....................................... 5,020 5,211 -------- -------- $463,105 $440,165 ======== ======== LIABILITIES AND STOCKHOLDERS' EQUITY Bank borrowings.................................... $ 25,900 $ 3,800 Convertible debentures............................. 65,000 65,000 Senior subordinated convertible debentures......... 4,065 8,609 Notes and bonds payable............................ 22,842 23,047 Accounts payable and accrued liabilities........... 8,545 6,782 Stockholders' equity: Preferred stock $1.00 par value; 5,000,000 shares authorized; none issued or outstanding Common stock $.10 par value; 25,000,000 shares authorized; issued and outstanding: 1994-- 18,171,908, 1993--17,979,516.................... 1,817 1,797 Capital in excess of par value................... 363,294 358,869 Cumulative net income............................ 160,895 149,951 Cumulative dividends............................. (189,253) (177,690) -------- -------- Total stockholders' equity..................... 336,753 332,927 -------- -------- $463,105 $440,165 ======== ========
See accompanying notes. 2 NATIONWIDE HEALTH PROPERTIES, INC. CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED) (IN THOUSANDS EXCEPT PER SHARE AMOUNTS)
THREE MONTHS ENDED MARCH 31, ---------------- 1994 1993 -------- ------- Revenues: Minimum rent............................................. $ 11,156 $ 9,833 Additional rent.......................................... 2,287 1,883 Interest and other income................................ 3,057 2,709 -------- ------- 16,500 14,425 Expenses: Depreciation and amortization............................ 2,787 2,360 Interest................................................. 1,920 1,630 General and administrative............................... 849 801 -------- ------- 5,556 4,791 -------- ------- Net income................................................. $ 10,944 $ 9,634 ======== ======= Net income per share....................................... $ .60 $ .56 ======== ======= Dividends paid per share................................... $ .6375 $ .5875 ======== ======= Weighted average shares outstanding........................ 18,099 17,059 ======== =======
See accompanying notes. 3 NATIONWIDE HEALTH PROPERTIES, INC. CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) (IN THOUSANDS)
THREE MONTHS ENDED MARCH 31, ---------------- 1994 1993 ------- ------- Cash flow from operating activities: Net income................ $10,944 $ 9,634 Depreciation, amortization and non-cash charges..... 2,997 2,455 ------- ------- Funds from operations... 13,941 12,089 Net (increase) decrease in other assets and liabilities.............. 1,032 (149) ------- ------- Net cash provided by operating activities... 14,973 11,940 Cash flow from investing ac- tivities: Acquisition of real estate properties............... (8,756) -- Investment in mortgage loans receivable......... (20,656) -- Principal payments on mortgage loans receivable............... 3,509 2,134 ------- ------- Net cash provided by (used in) investing activities............. (25,903) 2,134 Cash flow from financing ac- tivities: Bank borrowings, net...... 22,100 (1,950) Dividends paid............ (11,562) (10,176) Other, net................ (288) (306) ------- ------- Net cash provided by (used in) financing activities............. 10,250 (12,432) ------- ------- Increase (decrease) in cash and cash equivalents....... (680) 1,642 Cash and cash equivalents, beginning of period........ 3,627 8,281 ------- ------- Cash and cash equivalents, end of period.............. $ 2,947 $ 9,923 ======= =======
See accompanying notes. 4 NATIONWIDE HEALTH PROPERTIES, INC. NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS MARCH 31, 1994 (UNAUDITED) (i) The condensed consolidated financial statements included herein have been prepared by the Company, without audit, and include all adjustments which are, in the opinion of management, necessary for a fair presentation of the results of operations for the three-month periods ended March 31, 1994 and 1993 pursuant to the rules and regulations of the Securities and Exchange Commission. Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted pursuant to such rules and regulations. Although the Company believes that the disclosures in such financial statements are adequate to make the information presented not misleading, these condensed consolidated financial statements should be read in conjunction with the Company's financial statements and the notes thereto included in the Company's 1993 Annual Report on Form 10-K filed with the Securities and Exchange Commission. The results of operations for the three- month periods ended March 31, 1994 and 1993 are not necessarily indicative of the results for a full year. (ii) The Company qualifies as a real estate investment trust under Sections 856 through 860 of the Internal Revenue Code of 1986, as amended. The Company intends to continue to qualify as such and therefore to distribute at least 95 percent of its taxable income to its stockholders. Accordingly, no provision has been made for federal income taxes. (iii) The Company invests in health care related real estate and, as of March 31, 1994 has investments in 164 facilities, 162 of which are long-term health care facilities, and 2 of which are rehabilitation hospitals. The Company's facilities which are owned and leased under "net" leases are accounted for as operating leases. The leases have initial terms ranging from 10 to 14 years, and most of the leases have eight five-year renewal options. The Company earns fixed monthly minimum rents and may earn periodic additional rents. The additional rent payments are generally computed as a percentage of facility net patient revenues in excess of base amounts. The base amounts, in most cases, are net patient revenues for the first year of the lease. Under the terms of the leases, the lessee is responsible for all maintenance, repairs, taxes and insurance on the leased properties. Fifty-two of the facilities were leased to and operated by subsidiaries of Beverly Enterprises, Inc. (iv) During the three-month period ended March 31, 1994, the Company acquired three long-term health care facilities in two separate transactions for an aggregate purchase price of approximately $7,500,000. The facilities were concurrently leased under terms generally similar to the Company's existing leases. In addition to the acquisitions, the Company provided capital improvement funding in the aggregate amount of approximately $1,200,000 in accordance with certain existing lease provisions. Such capital improvements will result in an increase in the minimum rents earned by the Company. During the three-month period ended March 31, 1994, the Company provided a mortgage loan secured by three long-term health care facilities in the amount of $11,200,000. Such loan provides for a maximum aggregate loan amount of $12,000,000. Additional funding will be provided for certain capital improvements and is expected to be funded within one year. Proceeds of approximately $3,063,000 were received in connection with the prepayment of one mortgage loan secured by 7 long-term care facilities. During April, 1994, the Company acquired three health care properties for an aggregate purchase price of approximately $15,000,000. The facilities are an integrated long-term care, subacute facility, a long-term health care facility and an assisted living facility. An $8,800,000 mortgage loan was also provided by the Company secured by a continuing care retirement community consisting of 103 skilled nursing beds and 145 assisted living units. 5 NATIONWIDE HEALTH PROPERTIES, INC. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS MARCH 31, 1994 OPERATING RESULTS First Quarter 1994 Compared to First Quarter 1993 Revenues for the three months ended March 31, 1994 increased $2,075,000, or 14 percent over the same period in 1993. The increase is primarily due to increased minimum rent and interest income resulting from investments in additional facilities during 1993 and 1994 and increased additional rent earned under the Company's existing leases. Total expenses for the three-month period increased $765,000, or 16% over the same period in 1993. The increase is due to an increase in depreciation due to the acquisition of facilities in 1993 and 1994, and to increased interest expense in connection with the issuance of $65,000,000 of convertible debentures in November 1993. This increase was partially offset by a decrease in interest expense in connection with the conversion of a substantial portion of the Company's senior subordinated convertible debentures during 1993 and 1994. The Company expects increased rental revenues due to the addition of facilities to its property base during 1993 and 1994 and due to increased additional rents under its leases. The Company also expects increased interest income resulting from its mortgage loan investments. Additional investments in health care facilities would also increase rental and/or interest income. As additional investments in facilities are made, depreciation and/or interest expense could also increase. Any such increases, however, are expected to be more than offset by rents or interest income associated with the investments. Liquidity and Capital Resources During the three months ended March 31, 1994, the Company acquired three long-term health care facilities in two separate transactions for an aggregate purchase price of approximately $7,500,000. Additionally, the Company provided a mortgage loan secured by three long-term health care facilities in an aggregate amount of $11,200,000. Such acquisitions and mortgages were funded by bank borrowings. Additionally, the Company has a commitment to purchase a long-term health care facility upon its completion for approximately $5,650,000 and concurrently lease such facility under terms generally similar to the Company's existing leases. At March 31, 1994, the Company had $44,100,000 available under its $70,000,000 revolving bank line of credit. On April 28, 1994, the Company amended the terms of its bank line of credit to increase the amount of the line of credit to $100,000,000 and extend its maturity to March 31, 1997. Additionally, the Company has effective shelf registrations on file with the Securities and Exchange Commission under which the Company may issue (a) up to $100,000,000 in aggregate principal amount of medium term notes and (b) up to $135,000,000 of securities including debt, convertible debt, common and preferred stock. The Company anticipates making additional investments in health care related facilities. Financing for such future investments may be provided by borrowings under the Company's bank line, private placements or public offerings of debt or equity, and the assumption of secured indebtedness. The Company believes it has sufficient liquidity and financing capability to finance future investments as well as repay borrowings at or prior to their maturity. 6 PART II NATIONWIDE HEALTH PROPERTIES, INC. OTHER INFORMATION MARCH 31, 1994 ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K. (a) Exhibits 10. Material contracts 10.1 Amendment Number One to Credit Agreement dated as of May 20, 1993 between the Company and Wells Fargo Bank, National Association, National Westminster Bank USA, The Diawa Bank, Limited, and Sanwa Bank California. (b) Reports on Form 8-K No reports on Form 8-K were filed by the Company during the three- month period ended March 31, 1994. 7 SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the Company has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. Date: May 12, 1994 Nationwide Health Properties, Inc. By MARK L. DESMOND --------------------------------------- Mark L. Desmond Vice President and Treasurer (Principal Financial Officer) 8 EX-10.1 2 CREDIT AGREEMENT, AM. NO.1 AMENDMENT NUMBER ONE TO CREDIT AGREEMENT ---------------------------------------- This AMENDMENT NUMBER ONE TO CREDIT AGREEMENT, dated as of April 28, 1994 (this "Amendment"), is entered into among NATIONWIDE HEALTH PROPERTIES, INC., a Maryland corporation (the "Borrower"), the financial institutions which are signatories to the Credit Agreement (each a "Bank" and, collectively, the "Banks"), and WELLS FARGO BANK, NATIONAL ASSOCIATION, as agent for the Banks thereunder (in such capacity, the "Agent"). WHEREAS, the Borrower has requested that the Banks amend certain provisions of the Credit Agreement to provide for, among other things, the making of revolving loans by the Banks to the Borrower in an aggregate principal amount of up to $100,000,000 at any time outstanding. WHEREAS, subject to the terms and conditions contained herein, the Banks are willing to amend such provisions of the Credit Agreement and to permit the incurrence of such Indebtedness. NOW, THEREFORE, in consideration of the mutual covenants, conditions, and provisions hereinafter set forth, the parties hereto agree as follows: ARTICLE 1 DEFINITIONS FOR THIS AMENDMENT; ------------------------------ AMENDMENT OF ARTICLE I OF THE CREDIT AGREEMENT ---------------------------------------------- 1.1 Definitions for this Amendment. Any and all initially capitalized terms ------------------------------ used herein shall have the meanings ascribed thereto in the Credit Agreement unless specifically defined herein. For purposes of this Amendment, the following initially capitalized terms shall have the following meanings: "Agent" shall have the meaning set forth in the introduction to this ----- Amendment. "Amendment" means this Amendment Number One to Credit Agreement among the --------- Borrower, the Banks, and the Agent. "Bank" and "Banks" shall have the respective meanings set forth in the ---- ----- introduction to this Amendment. "Borrower" shall have the meaning set forth in the introduction to this -------- Amendment. "Credit Agreement" means that certain Credit Agreement, dated as of May 20, ---------------- 1993, among the Borrower, the Banks, and the Agent. 1.2 Amendment of Section 1.1 of the Credit Agreement. Section 1.1 of the ------------------------------------------------ Credit Agreement is hereby amended by (a) deleting the following defined terms in their entireties: "Commitment," "Healthcare Property," and "Termination Date"; and (b) inserting the following defined terms: "Commitment" means, when used with reference to any Bank at the time any ---------- determination thereof is to be made, the amount set forth opposite the name of such Bank on the signature pages of the First Amendment, as from time to time reduced pursuant to Section 4.1, or, where the context so requires, ----------- the obligation of such Bank to make Loans up to such amount on the terms and conditions set forth in this Agreement. "First Amendment" means that certain Amendment Number One to Credit --------------- Agreement, dated as of April 28, 1994, among the Borrower, the Banks, and the Agent. "Healthcare Property" means a property operating as a nursing home, an ------------------- acute care hospital, a rehabilitation hospital, an assisted living facility, an adult congregate living facility, a personal care facility, a medical office building, or any combination of the foregoing; provided that -------- any of the foregoing may also include independent living units as a part of any such property. "Termination Date" means, unless extended pursuant to Section 4.1(b), March ---------------- -------------- 31, 1997. ARTICLE 2 AMENDMENT OF CERTAIN PROVISIONS ------------------------------- OF THE CREDIT AGREEMENT ----------------------- 2.1 Amendment of Section 9.4 of the Credit Agreement. Section 9.4 of the ------------------------------------------------ Credit Agreement is amended by deleting subsections (f)(iii) and (iv) therefrom in their entireties and substituting therefor the following subsections: (iii) additional purchases of Healthcare Properties of other Persons the consideration (whether in cash or in kind) for which (exclusive of expenditures permitted under subsection (g)) does not exceed (A) $15,000,000 individually, (B) $100,000,000 in aggregate in any fiscal year, and (C) $250,000,000 in the aggregate after May 20, 1993 (or such greater amounts as shall be approved by the prior written consent of the Majority Banks); provided that, after giving effect to such purchase, no Default -------- shall have occurred and be continuing; provided further that, at the time ---------------- of any such purchase, the subject Healthcare Property shall have been in operation for not less than three years and all material construction of facilities on such property shall have been completed; (iv) Investments in mortgage loans secured by Healthcare Properties in an aggregate amount not to exceed $150,000,000; or -2- ARTICLE 3 MISCELLANEOUS ------------- 3.1 Loan Documents. This Amendment shall be one of the Loan Documents. -------------- 3.2 Execution. This Amendment may be executed in any number of --------- counterparts, each of which when so executed and delivered shall be deemed an original. All of such counterparts shall constitute but one and the same instrument. Delivery of an executed counterpart of the signature pages of this Amendment by telecopier shall be equally effective as delivery of a manually executed counterpart. Any party delivering an executed counterpart of the signature pages of this Amendment by telecopier shall thereafter also promptly deliver a manually executed counterpart, but the failure to deliver such manually executed counterpart shall not affect the validity, enforceability, and binding effect of this Amendment. 3.3 Effectiveness. This Amendment shall be effective as of the date first ------------- written above, when (a) one or more counterparts hereof shall have been executed by the Borrower, the Banks, and the Agent and shall have been delivered to the Agent; (b) the Agent shall have received new Notes, dated as of the date hereof, executed by the Borrower evidencing the increased Commitments provided for hereunder; (c) the Borrower shall have paid $37,500 to the Agent for the account of the Banks that increased their respective Commitments pursuant to this Amendment, to be allocated in proportion to such increases; and (d) the Borrower shall have paid to the Agent such fees for arrangement services rendered by it as separately agreed upon between the Borrower and the Agent. 3.4 No Other Amendment. Except as expressly amended hereby, the Credit ------------------ Agreement shall remain unchanged and in full force and effect. To the extent any terms or provisions of this Amendment conflict with those of the Credit Agreement, the terms and provisions of this Amendment shall control. This Amendment shall be deemed a part of and is hereby incorporated in the Credit Agreement. 3.5 Governing Law. This Amendment shall be governed by, and construed and ------------- enforced in accordance with, the laws of the State of California. IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be executed and delivered as of the date first set forth above. THE BORROWER ------------ NATIONWIDE HEALTH PROPERTIES, INC. By MARK L. DESMOND ------------------------------------- Title: Vice President and Treasurer -3- THE AGENT --------- WELLS FARGO BANK, NATIONAL ASSOCIATION By RICHARD LA POINT ------------------------------------- Title: Vice President THE BANKS --------- Commitment: WELLS FARGO BANK, NATIONAL ASSOCIATION - - ---------- $42,000,000 By RICHARD LA POINT ------------------------------------- Title: Vice President $25,000,000 NATIONAL WESTMINSTER BANK USA By W. WAKEFIELD SMITH ------------------------------------- Title: Vice President $19,000,000 THE DAIWA BANK, LIMITED By YVONNE K. TSO ------------------------------------- Title: Vice President By STEVEN K. JOHNSON ------------------------------------- Title: -4- $14,000,000 SANWA BANK CALIFORNIA By DEL LORIMER ------------------------------------- Title: -5- -----END PRIVACY-ENHANCED MESSAGE-----