-----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, dz4fpnjUTKbC7yPjOfYpvZX/kSAFF5gAut/qOUIoZ9fUOP78KFnOgC+9pBfTK+XO O6NpWVh7Wc2tec+6S8t2zw== 0000898430-95-000321.txt : 19950615 0000898430-95-000321.hdr.sgml : 19950615 ACCESSION NUMBER: 0000898430-95-000321 CONFORMED SUBMISSION TYPE: DEF 14A PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 19950421 FILED AS OF DATE: 19950317 SROS: NYSE FILER: COMPANY DATA: COMPANY CONFORMED NAME: NATIONWIDE HEALTH PROPERTIES INC CENTRAL INDEX KEY: 0000780053 STANDARD INDUSTRIAL CLASSIFICATION: REAL ESTATE INVESTMENT TRUSTS [6798] IRS NUMBER: 953997619 STATE OF INCORPORATION: MD FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: DEF 14A SEC ACT: 1934 Act SEC FILE NUMBER: 001-09028 FILM NUMBER: 95521442 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 DEF 14A 1 DEFINITIVE PROXY MATERIAL SCHEDULE 14A INFORMATION Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of 1934 (Amendment No. ) Filed by the Registrant [_] Filed by a Party other than the Registrant [_] Check the appropriate box: [_] Preliminary Proxy Statement [_] Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2)) [X] Definitive Proxy Statement [_] Definitive Additional Materials [_] Soliciting Material Pursuant to Section 240.14a-11(c) or Section 240.14a-12 NATIONWIDE HEALTH PROPERTIES,INC. - -------------------------------------------------------------------------------- (Name of Registrant as Specified In Its Charter) - -------------------------------------------------------------------------------- (Name of Person(s) Filing Proxy Statement, if other than the Registrant) Payment of Filing Fee (Check the appropriate box): [X] $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), 14a-6(i)(2) or Item 22(a)(2) of Schedule 14A. [_] $500 per each party to the controversy pursuant to Exchange Act Rule 14a-6(i)(3). [_] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11. (1) Title of each class of securities to which transaction applies: ------------------------------------------------------------------------- (2) Aggregate number of securities to which transaction applies: ------------------------------------------------------------------------- (3) Per unit price or other underlying value of transaction computed pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the filing fee is calculated and state how it was determined): ------------------------------------------------------------------------- (4) Proposed maximum aggregate value of transaction: ------------------------------------------------------------------------- (5) Total fee paid: ------------------------------------------------------------------------- [_] Fee paid previously with preliminary materials. [_] Check box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid previously. Identify the previous filing by registration statement number, or the Form or Schedule and the date of its filing. (1) Amount Previously Paid: ------------------------------------------------------------------------- (2) Form, Schedule or Registration Statement No.: ------------------------------------------------------------------------- (3) Filing Party: ------------------------------------------------------------------------- (4) Date Filed: ------------------------------------------------------------------------- Notes: [LOGO OF NATIONWIDE HEALTH PROPERTIES, INC.] ---------------- NOTICE OF ANNUAL MEETING OF STOCKHOLDERS APRIL 21, 1995 To the Stockholders: The Annual Meeting of Stockholders of Nationwide Health Properties, Inc. (the "Company") will be held at The Sutton Place Hotel, 4500 MacArthur Boulevard, Newport Beach, California on April 21, 1995 at 1:00 p.m., for the following purposes: 1. To elect three directors; 2. To ratify the selection of Arthur Andersen LLP as independent accountants for the year ending December 31, 1995; and 3. To transact such other business as may properly come before the meeting or any adjournments thereof. The nominees for election as directors are Milton J. Brock, Jr., David R. Banks and Jack D. Samuelson, each of whom is currently serving as a director of the Company. The Board of Directors has fixed the close of business on March 10, 1995 as the record date for the determination of stockholders who are entitled to notice of and to vote at the meeting, or any adjournments thereof. We encourage you to attend the meeting. Whether you are able to attend or not, we urge you to indicate your vote on the enclosed proxy card FOR the election of the directors named in the attached Proxy Statement and FOR the ratification of the selection of Arthur Andersen LLP as independent accountants for the year ending December 31, 1995. Please sign, date and return the proxy card promptly in the enclosed envelope. If you attend the meeting, you may vote in person even if you have previously mailed a proxy card. By Order of the Board of Directors R. Bruce Andrews President and Chief Executive Officer March 17, 1995 Newport Beach, California NATIONWIDE HEALTH PROPERTIES, INC. 4675 MACARTHUR COURT, SUITE 1170 NEWPORT BEACH, CALIFORNIA 92660 ---------------- PROXY STATEMENT ---------------- ANNUAL MEETING OF STOCKHOLDERS APRIL 21, 1995 The accompanying proxy is solicited by the Board of Directors of Nationwide Health Properties, Inc. (the "Company") to be voted at the Annual Meeting of Stockholders to be held April 21, 1995, and at any adjournments of the meeting. It is anticipated that this proxy material will be mailed on or about March 17, 1995. A stockholder giving a proxy has the power to revoke it at any time before it is exercised. A proxy may be revoked by filing with the Secretary of the Company (i) an instrument revoking the proxy or (ii) a duly executed proxy bearing a later date. The powers of the proxy holders will be suspended if the person executing the proxy is present at the meeting and elects to vote in person. If the proxy is neither revoked nor suspended, it will be voted by those therein named. VOTING SECURITIES AND PRINCIPAL HOLDERS THEREOF The outstanding voting securities of the Company as of March 10, 1995 consisted of 18,271,379 shares of Common Stock, par value $.10 per share ("Common Stock"). Stockholders of record as of the close of business on March 10, 1995 are entitled to notice of and to vote at the meeting and any adjournments thereof. Each holder of shares of Common Stock is entitled to one vote per share on all matters properly brought before the meeting. Shares represented by proxy or in person at the Annual Meeting will be tabulated by the inspector of elections appointed for the meeting and who will also determine whether or not a quorum is present. The inspector of elections will treat abstentions as shares that are present and entitled to vote for purposes of determining the presence of a quorum and (except as noted below) as shares present for other purposes but as unvoted for purposes of determining the approval of any matter submitted to the stockholders for a vote. If a broker indicates on the proxy that it does not have discretionary authority as to certain shares to vote on a particular matter, those shares will not be considered as present and entitled to vote with respect to that matter. Stockholders are not permitted to cumulate votes for the purpose of electing directors or otherwise. The following table sets forth the names of those shareholders known to the Company to be the beneficial owners of more than 5% of the Company's outstanding Common Stock at December 31, 1994.
COMMON STOCK PERCENT OF BENEFICIALLY OUTSTANDING BENEFICIAL OWNER OWNED SHARES ---------------- ------------ ----------- Scudder, Stevens & Clark, Inc.................. 1,316,800(1) 7.22% 345 Park Avenue New York, NY 10154 Cohen and Steers Capital Management, Inc....... 960,100(2) 5.26% 757 Third Avenue New York, NY 10017
- -------- (1) Scudder, Stevens & Clark, Inc. had sole dispositive power with respect to 1,316,800 shares, sole voting power with respect to 328,500 shares and shared voting power with respect to 492,200 shares. Share ownership numbers are based on information as of December 31, 1994 obtained from a Schedule 13G filed with the Securities and Exchange Commission by Scudder, Stevens & Clark, Inc. (2) Cohen and Steers Capital Management, Inc. had sole dispositive power with respect to 960,100 shares and sole voting power with respect to 873,100 of such shares. Share ownership numbers are based on information as of December 31, 1994 obtained from a Schedule 13G filed with the Securities and Exchange Commission by Cohen and Steers Capital Management, Inc. PROPOSAL I ELECTION OF DIRECTORS Pursuant to the Company's Articles of Incorporation, the directors have been divided into three groups. At the meeting, three directors will be elected in one group to hold office for a term of three years or, in each case, until their respective successors shall have been duly elected and qualified. The remaining directors shall continue in office until their respective terms expire and until their successors have been duly elected and qualified. The nominees for election to the three positions of director to be voted upon at the meeting are Milton J. Brock, Jr., David R. Banks and Jack D. Samuelson. Unless authority to vote for the election of directors has been specifically withheld, the persons named in the accompanying proxy intend to vote for the election of Messrs. Brock, Banks and Samuelson to hold office as directors for a term of three years each or until their respective successors have been duly elected and qualified. The affirmative vote of a majority of all votes cast at the Annual Meeting is required for the election of directors. If any nominee becomes unavailable for any reason (which event is not anticipated), the shares represented by the enclosed proxy may (unless such proxy contains instructions to the contrary) be voted for such other person or persons as may be determined by the holders of such proxies. In no event would the proxy be voted for more than three nominees. The following information relates to the nominees for election as directors of the Company, the other persons whose terms as directors continue after the meeting, certain executive officers, and all directors and executive officers of the Company as a group:
COMMON STOCK BENEFICIALLY EXPIRATION OWNED AT OF TERM AS FEBRUARY 28, NAME AGE POSITION DIRECTOR(1) 1995(2) ---- --- -------- ----------- ------------ Milton J. Brock, Jr*x... 79 Chairman of the Board and Director 1995 19,700(3) R. Bruce Andrews*x...... 54 President, Chief Executive Officer 1996 60,433 and Director David R. Banks+*........ 58 Director 1995 10,100 Sam A. Brooks, Jr.*..... 56 Director 1997 7,400 Robert H. Finch(S)+..... 69 Director 1997 4,400 Charles D. Miller(S)+x.. 67 Director 1996 20,500 Jack D. Samuelson*...... 70 Director 1995 600 Mark L. Desmond......... 36 Vice President and Treasurer 20,000 Gary E. Stark........... 39 Vice President and General Counsel 4,500 T. Andrew Stokes........ 47 Vice President of Development 5,750 All directors and executive officers as a group (10 persons)............... 153,383(3)
- -------- * Member of Investment Committee (S) Member of Audit Committee + Member of Compensation Committee x Member of Nominating Committee (1) All directors were first elected in 1985, except R. Bruce Andrews, who was elected in October 1989 and Jack D. Samuelson, who was elected in October 1994. (2) Except as otherwise noted, all shares are owned beneficially with sole voting and investment power. Included in the amounts above are 1,700 shares with respect to Mr. Desmond and All Directors and Executive Officers as a group, which are subject to options granted under the Company's 1989 Stock Option Plan that are exercisable within 60 days of February 28, 1995. In each instance, and in the aggregate for all directors and executive officers as a group, shares owned represent less than 1% of the outstanding Common Stock. 2 (3) Such amount includes 800 shares held in trusts for certain of Mr. Brock's family members, of which Mr. Brock serves as trustee, and 16,500 shares held in a trust, of which Mr. Brock and his wife serve as trustees. Such amount does not include 3,000 shares owned by Mr. Brock's wife, as to which Mr. Brock disclaims any beneficial interest. MILTON J. BROCK, JR.--Chairman of the Board of the Company since September 1989 and a director of the Company since its inception. Mr. Brock served as President and Chief Executive Officer of the Company from June 1988 to September 1989. Mr. Brock began his career in 1940 with M. J. Brock & Sons, Inc., a real estate contractor and developer, and was elected President in 1959, Chairman and Chief Executive Officer in 1973 and Chairman Emeritus in 1985 upon his retirement. Mr. Brock was a director of Bank of America REIT (now BRE Properties) from its inception until his retirement in 1985, and had served for 26 years as a director of Hollywood Presbyterian Medical Center. R. BRUCE ANDREWS--President and Chief Executive Officer of the Company since September 1989 and a director of the Company since October 1989. Mr. Andrews had previously served as a director of American Medical International, Inc., a hospital management company, and served as its Chief Financial Officer from 1970 to 1985 and its Chief Operating Officer in 1985 and 1986. From 1986 through 1989, Mr. Andrews was engaged in various private investments. Mr. Andrews is also a director of ReadiCare, Inc. and Alexander Haagen Properties, Inc. DAVID R. BANKS--Director. Mr. Banks has served as Chairman, President and Chief Executive Officer of Beverly Enterprises, Inc., an operator of nursing facilities, pharmacies and pharmacy-related outlets, since March 1990. Mr. Banks joined Beverly Enterprises, Inc. as President and Chief Operating Officer in October 1979 and was elected President and Chief Executive Officer in May 1989. He has been a director of Beverly Enterprises, Inc. since September 1979. Mr. Banks is also a director of Wal-Mart Stores, Inc., Ralston Purina Company and Wellpoint Health Networks Inc. Mr. Banks was Chairman of the Board of the Company from its inception until June 1988. SAM A. BROOKS, JR.--Director. Mr. Brooks has been President of MedCare Investment Corporation, a health care investment company, since May 1991. Mr. Brooks was Chairman of Rivendell of America, an operator of in-patient psychiatric facilities, from June 1989 to April 1991. Mr. Brooks is a director of Kinetic Concepts, Inc., PhyCor, Inc. and Quorum Health Group, Inc. Mr. Brooks was Chairman of the Board of the Company from June 1988 to September 1989. Mr. Brooks served as President and Chief Executive Officer of the Company from its inception until June 1988. Mr. Brooks was the Chief Financial Officer of Hospital Corporation of America, a hospital management company, from 1970 to 1985. ROBERT H. FINCH--Director. Mr. Finch is an attorney specializing in health care matters, a position he has held for more than five years. Mr. Finch is a former Secretary of the Department of Health, Education and Welfare and a former Lieutenant Governor of California. Mr. Finch is a director of ICN Pharmaceuticals, Inc., Geothermal Surveys, Inc. and serves as trustee of the Huntington Memorial Hospital. CHARLES D. MILLER--Director. Mr. Miller has served as the Chairman and Chief Executive Officer of Avery Dennison Corporation, a manufacturer of self- adhesive materials, labels and office products, since 1983. Mr. Miller is also a director of Great Western Financial Corporation, SCE Corp. and Pacific Mutual Life Insurance Company. JACK D. SAMUELSON--Director. Mr. Samuelson co-founded Samuelson Brothers, a real estate contractor and developer, in 1946 and has served as President and Chairman of the Board since 1957. 3 BOARD OF DIRECTORS AND COMMITTEES OF THE BOARD The Board of Directors held seven meetings during 1994. During that period, no director attended fewer than 75% of all meetings of the Board and of committees on which he served. The Audit Committee, which met twice in 1994, selects the Company's independent accountants, fixes the compensation to be paid to such accountants, reports to the Board with respect to the scope of audit procedures and determines whether certain policies and procedures of the Company are being complied with. The Investment Committee, which held eight meetings during 1994, has the power to approve the Company's investments and reviews the Company's investment policies. The Compensation Committee, which held one meeting in 1994, has been delegated the functions of the Board with respect to the compensation of the Company's key management personnel, and administration of the Company's Stock Option Plan and Deferred Compensation Plan. The Nominating Committee, which met twice in 1994, reviews candidates for director suggested by management, directors, stockholders and others and makes recommendations to the Board of Directors regarding the composition of the Board of Directors and selection of individual candidates for election to the Board of Directors. Suggestions by stockholders for candidates should be submitted in writing, accompanied by biographical material for evaluation, and sent to the office of the President, Nationwide Health Properties, Inc., 4675 MacArthur Court, Suite 1170, Newport Beach, California 92660. Non-employee directors receive compensation for their Board service in the amount of $23,000 per year. The Chairman receives an additional $12,000 per year. Committee chairmen receive additional compensation for their Board Committee service in the amount of $3,600 per year. Non-employee directors also receive $1,000 for attendance at each meeting of the Board and $500 for attendance at each committee meeting. The Company reimburses directors for travel expenses incurred in connection with their duties as directors of the Company. In addition, non-employee directors are eligible to participate in the Retirement Plan for Directors (the "Directors' Retirement Plan"), whereby individuals who were directors as of January 1, 1990 and subsequently terminate their service as a director with at least five years of service are entitled to receive an annual retirement benefit from the Company equal to the aggregate annual director retainer in effect at the time of the eligible director's termination from the Board. The current retainer amount is $23,000 per year. Any increases in the annual retainer which take effect after an eligible director's termination from the Board will automatically operate to increase the annual retirement benefit under the Directors' Retirement Plan. Benefits under the Directors' Retirement Plan will be paid for a period equal to the number of years of service that the eligible director served on the Board. Upon the death of an eligible director, any benefits under the Directors' Retirement Plan will be paid to his or her surviving spouse in accordance with the same payment schedule set forth above until receipt of the maximum benefit to which the eligible director would have been entitled had he or she survived or until the death of the eligible spouse, whichever occurs first. 4 EXECUTIVE COMPENSATION AND OTHER INFORMATION COMPENSATION OF EXECUTIVE OFFICERS The following table sets forth for the years ended December 31, 1994, 1993 and 1992, the compensation for services in all capacities to the Company of those persons who were at December 31, 1994 (i) the chief executive officer and (ii) the other highly compensated executive officers of the Company whose total 1994 salary and bonus exceeded $100,000 (the "Named Executive Officers"). No other individuals served as executive officers during 1994. SUMMARY COMPENSATION TABLE
LONG-TERM COMPENSATION ------------ ANNUAL RESTRICTED COMPENSATION STOCK AWARDS ------------------ ------------ NAME AND PRINCIPAL ALL OTHER POSITION YEAR SALARY($) BONUS($) ($)(1) COMPENSATION($)(2) - ------------------ ---- --------- -------- ------------ ------------------ R. Bruce Andrews, Presi- dent...................... 1994 $346,500 $210,000 $238,688 $13,860 & Chief Executive Officer 1993 330,000 165,000 233,625 13,200 1992 300,000 200,000 188,438 12,000 Mark L. Desmond, Vice...... 1994 120,000 50,000 53,438 4,800 President & Treasurer 1993 115,000 34,500 50,063 4,600 1992 105,000 31,500 42,188 4,200 T. Andrew Stokes, Vice..... 1994 120,000 50,000 53,438 4,800 President, Development 1993 115,000 34,500 25,031 4,238 1992 46,115 13,835 45,750 1,658 Gary E. Stark, Vice........ 1994 114,000 34,200 53,438 -- President & General Counsel 1993 105,000 31,500 50,603 -- 1992 -- -- -- --
- -------- (1) Restricted stock awards vest five years after the date of issuance. Dollar amounts shown equal the number of shares of restricted stock awarded multiplied by the stock price on award date, without giving effect to the diminution of value attributable to the restrictions on such stock. The table below shows the number and value of the aggregate restricted stock holdings as of December 31, 1994 of each Named Executive Officer:
SHARES VALUE ------ -------- R. Bruce Andrews.......................................... 20,400 $729,300 Mark L. Desmond........................................... 4,500 160,875 T. Andrew Stokes.......................................... 3,750 134,063 Gary E. Stark............................................. 3,000 107,250
The value of the aggregate restricted stock holdings is based upon the closing price of the Common Stock on December 31, 1994 of $35.75, without giving effect to the diminution of value attributable to the restrictions on such stock. Dividends are paid on the restricted stock at the same rate that the Company pays dividends on all of its shares of Common Stock. (2) Such amounts represent the Company's matching contribution to the Named Executive Officers' deferred compensation plan accounts. 5 AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR AND FISCAL YEAR-END OPTION VALUES The following table sets forth information with respect to the Named Executive Officers concerning the exercise of stock options during 1994 and unexercised stock options held as of December 31, 1994. During 1994, no options were granted to any of the Named Executive Officers.
VALUE OF UNEXERCISED NUMBER OF UNEXERCISED IN-THE-MONEY OPTIONS AT FISCAL OPTIONS AT FISCAL YEAR-END(#) YEAR-END($)(A) ------------------------- ------------------------- SHARES ACQUIRED ON VALUE NAME EXERCISE(#) REALIZED($)(A) EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE ---- ----------- -------------- ----------- ------------- ----------- ------------- R. Bruce Andrews........ 10,000 $210,000 -- -- -- -- Mark L. Desmond......... 400 $ 8,400 2,600 -- $63,700 --
- -------- (A) Market value of the underlying securities at exercise date or year-end, as the case may be, minus the exercise price of "in-the-money" stock options. EXECUTIVE EMPLOYMENT SECURITY POLICY The Company has adopted an Executive Employment Security Policy which provides generally that if, within three years following a change of control of the Company, the employment of any plan participant is terminated, except under defined circumstances, the participant shall be entitled to receive payments equal to his highest compensation for twelve to thirty-six months depending upon the participant's length of employment. Such payments would be reduced by one-half of any compensation received from any new employment. R. Bruce Andrews and Mark L. Desmond have been designated plan participants. COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION Mr. Banks serves as Chairman, President and Chief Executive Officer of Beverly Enterprises, Inc. Mr. Banks is a member of the Company's Compensation Committee and was Chairman of the Board of Directors of the Company from its inception until June 1988. At December 31, 1994, Beverly Enterprises, Inc. or its subsidiaries ("Beverly") leased and operated 48 of the Company's 144 owned facilities and had mortgage notes payable to the Company of approximately $2,824,000, which are secured by facilities owned by Beverly. Beverly paid aggregate rent, including additional rent, and interest payments of approximately $22,776,000 to the Company in 1994. The aggregate minimum rental payable in 1995 by Beverly to the Company for the 48 facilities leased and operated as of December 31, 1994 will be approximately $15,559,000. Additional rent, based upon increased net patient revenues of such facilities, may also be payable by Beverly to the Company in 1995. The aggregate interest payable in 1995 by Beverly to the Company for the mortgage loans will be approximately $420,000. REPORT OF THE COMPENSATION COMMITTEE WITH RESPECT TO EXECUTIVE COMPENSATION As members of the Compensation Committee, it is our duty to administer the Company's various incentive plans, including its stock incentive plan, its annual bonus plan and its deferred compensation plan. In addition, we review compensation levels of members of management, evaluate the performance of management, consider management succession and related matters. The Committee reviews with the Board in detail all aspects of compensation for the Company's executive officers. The compensation policy of the Company, which is endorsed by the Committee, is that a substantial portion of the annual compensation of each officer relates to and is contingent upon the performance of the Company, as well as the individual contribution of each officer. As a result, much of an executive officer's compensation is "at risk" with annual bonus and stock award compensation amounting to a significant portion of each executive officer's total compensation. 6 EXECUTIVE COMPENSATION COMPONENTS The Company's executive compensation is based on three key components, each of which is intended to serve the Company's overall compensation philosophy. BASE SALARY. Salaries for executives are reviewed by the Compensation Committee on an annual basis and may be increased upon a subjective assessment of the individual executive's contribution to the Company as well as competitive pay levels. Base salary is intended to be set at a level competitive to amounts paid to executive officers of companies with similar business structure, size and marketplace orientation. The consideration of competitive salaries is subjective and is based on the business experience of the members of the Compensation Committee and is not based on a specific list of companies, the comparable performance of such other companies, or on target levels tied to salaries of comparable companies. ANNUAL BONUS. Annual bonuses are awarded in cash based upon a subjective evaluation of the performance of each executive officer and a subjective evaluation of the performance of the Company as a whole. The performance evaluation of the Company is based on subjective and objective factors, including total return to stockholders, growth in per share funds from operations, asset growth, credit quality and the perception of the Company by industry analysts; however, no specific targets are assigned or established by the Compensation Committee for these criteria. STOCK OPTION PLAN. All of the executive officers participate in the Company's Stock Option Plan. That plan's primary purpose is to offer an incentive for long-term performance of the Company. The plan provides for awards of restricted stock, grants of options and stock appreciation rights. The Company retained the services of an independent compensation consultant in 1992 to provide the Compensation Committee with expertise on the types of stock incentives to be available through the Company's stock option plan and the level of awards under the plan. Since 1992, awards of restricted stock have been made annually to the executive officers of the Company. Such restricted stock vests five years after the date of award and is intended to build each executive officer's equity interest in the Company as well as provide incentives for the long-term performance of the Company. Awards to executive officers other than the Chief Executive Officer have ranged between 1,500 to 2,000 shares per year. Awards to the Chief Executive Officer during 1994, 1993 and 1992 were 6,700 shares, 7,000 shares and 6,700 shares, respectively. The levels of such awards were determined in part by reference to the recommendations of the independent compensation consultant, including consideration of the amounts previously awarded to the executive officers, and by a subjective assessment of the performance of the Company similar to that described above under Annual Bonus. The levels of awards made and the proportion of total compensation payable through restricted stock awards is not subject to any fixed formula. CEO COMPENSATION Mr. Andrews' salary for 1994 was set by the Compensation Committee at its January 1994 meeting. Mr. Andrews' base salary was increased $16,500 to $346,500 in light of salaries being paid to other similarly situated CEO's as determined based on the business experience of the members of the Compensation Committee and in recognition of the Company's performance in 1993 under his leadership. Mr. Andrews' bonus with respect to 1994 was $210,000, or 61% of his base salary for 1994, and was awarded based upon a subjective evaluation of Mr. Andrews' performance and of the Company as a whole as described under Annual Bonus above. Mr. Andrews was awarded 6,700 shares of restricted stock during January 1994, or 69% of his base salary based on the market value of the stock on the award date. The purpose of this award was to provide a long-term incentive to Mr. Andrews as the stock vests on the fifth anniversary of the award date. The award was based upon a subjective evaluation of Mr. Andrews' performance and that of the Company as a whole. 7 The Compensation Committee has considered the anticipated tax treatment to the Company regarding the compensation and benefits paid to the executive officers of the Company in light of the enactment of Section 162(m) of the Internal Revenue Code of 1986, as amended. The basic philosophy of the Compensation Committee is to strive to provide such executive officers with a compensation package which will preserve the deductibility of such payments for the Company. However, certain types of compensation payments and their deductibility depend upon the timing of an executive officer's vesting or exercise of previously granted rights. Moreover, interpretations of and changes in the tax laws and other factors beyond the Compensation Committee's control may affect the deductibility of certain compensation payments. The Compensation Committee will consider various alternatives to preserve the deductibility of compensation payments and benefits to the extent reasonably practicable and to the extent consistent with its other compensation objectives. March 17, 1995 Compensation Committee David R. Banks Robert H. Finch Charles D. Miller 8 PERFORMANCE GRAPH The following graph demonstrates the performance of the cumulative total return to the stockholders of the Company's Common Stock during the previous five years in comparison to the cumulative total return on the National Association of Real Estate Investment Trusts' (NAREIT) Equity Index and the Standard & Poor's 500 Stock Index. The NAREIT Equity Index is comprised of all tax-qualified, equity oriented, real estate investment trusts listed on the New York Stock Exchange, the American Stock Exchange or the NASDAQ National Market System. COMPARISON OF FIVE-YEAR CUMULATIVE TOTAL RETURN AMONG NATIONWIDE HEALTH PROPERTIES, INC., S&P 500 AND NAREIT EQUITY INDEX PERFORMANCE GRAPH APPEARS HERE
NATIONWIDE NAREIT Measurement Period HEALTH S&P EQUITY (Fiscal Year Covered) PROPERTIES, INC. 500 INDEX INDEX - ------------------- ---------------- --------- ---------- Measurement Pt- 12/89 $100 $100 $100 FYE 12/90 $147.5 $ 96.9 $ 84.65 FYE 12/91 $251.14 $126.42 $114.86 FYE 12/92 $323.88 $136.05 $131.62 FYE 12/93 $377.92 $149.76 $157.49 FYE 12/94 $408.35 $151.74 $162.49
IT SHOULD BE NOTED THAT THIS GRAPH REPRESENTS HISTORICAL STOCK PRICE PERFORMANCE AND IS NOT NECESSARILY INDICATIVE OF ANY FUTURE STOCK PRICE PERFORMANCE. THE FOREGOING REPORT OF THE COMPENSATION COMMITTEE AND THE PERFORMANCE GRAPH THAT APPEARS IMMEDIATELY AFTER SUCH REPORT SHALL NOT BE DEEMED TO BE SOLICITING MATERIAL OR TO BE FILED WITH THE SECURITIES AND EXCHANGE COMMISSION UNDER THE SECURITIES ACT OF 1933 OR THE SECURITIES EXCHANGE ACT OF 1934 OR INCORPORATED BY REFERENCE IN ANY DOCUMENT SO FILED. 9 PROPOSAL II RATIFICATION OF APPOINTMENT OF AND RELATIONSHIP WITH INDEPENDENT PUBLIC ACCOUNTANTS The Company has selected Arthur Andersen LLP as its auditors for the year ending December 31, 1995, subject to ratification by stockholders. Arthur Andersen LLP audited the Company's financial statements for the year ended December 31, 1994 and has been the Company's auditors since the Company's inception in 1985. If the stockholders do not ratify the selection of Arthur Andersen LLP, the selection of independent accountants will be considered by the Board of Directors, although the Board of Directors would not be required to select different independent accountants for the Company. The Board of Directors retains the power to select another firm as independent accountants for the Company to replace the firm whose selection was ratified by the Company's stockholders in the event the Board of Directors determines that the best interest of the Company warrants a change of its independent accountants. Representatives of Arthur Andersen LLP are expected to be present at the meeting and will be given the opportunity to make a statement if they desire to do so. It is expected that they will be available to respond to appropriate questions from stockholders at the meeting. STOCKHOLDER PROPOSALS November 17, 1995 is the date by which proposals of stockholders intended to be presented at the 1996 Annual Meeting of Stockholders must be received by the Company for inclusion in the Company's proxy statement and form of proxy relating to that meeting. EXPENSES OF SOLICITATION The total cost of this solicitation will be borne by the Company. In addition to use of the mails, proxies may be solicited by directors and officers of the Company personally and by telephone or telegraph. The Company may reimburse persons holding shares in their own names or in the names of the nominees for expenses they incur in obtaining instructions from beneficial owners of such shares. The Company has also engaged D.F. King, Inc. to deliver proxies for a fee of approximately $1,500 plus out-of-pocket expenses. COMPLIANCE WITH SECTION 16(A) OF THE SECURITIES EXCHANGE ACT OF 1934 Section 16(a) of the Securities Exchange Act of 1934 requires the Company's directors and executive officers, and persons who own more than ten percent of a registered class of the Company's equity securities, to file with the Securities and Exchange Commission ("SEC") and the New York Stock Exchange initial reports of ownership and reports of changes in ownership of Common Stock and other equity securities of the Company. Executive officers, directors and greater than ten-percent stockholders are required by SEC regulation to furnish the Company with copies of all Section 16(a) forms they file. To the Company's knowledge, based solely a on review of the copies of such reports furnished to the Company, all Section 16(a) filing requirements applicable to its executive officers and directors were complied with, except that the Form 3 for Jack D. Samuelson was not filed timely following his election to the Board of Directors of the Company. 10 OTHER MATTERS A copy of the annual report of the Company for the year ended December 31, 1994, including financial statements, is enclosed herewith. THE COMPANY WILL PROVIDE WITHOUT CHARGE TO ANY PERSON SOLICITED HEREBY, UPON THE WRITTEN REQUEST OF SUCH PERSON, A COPY OF THE COMPANY'S ANNUAL REPORT ON FORM 10-K FOR THE YEAR ENDED DECEMBER 31, 1994 FILED WITH THE SECURITIES AND EXCHANGE COMMISSION. SUCH REQUESTS SHOULD BE DIRECTED TO MARK L. DESMOND, TREASURER OF THE COMPANY, AT 4675 MacARTHUR COURT, SUITE 1170, NEWPORT BEACH, CALIFORNIA 92660. The Board of Directors knows of no other business to be presented at the meeting, but if other matters do properly come before the meeting, it is intended that the persons named in the proxy will vote on such matters in accordance with their best judgment. R. Bruce Andrews President and Chief Executive Officer March 17, 1995 Newport Beach, California 11 - -------------------------------------------------------------------------------- NATIONWIDE HEALTH PROPERTIES, INC. P R O X Y THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS The undersigned hereby appoints Mark L. Desmond, Don M. Pearson and Gary E. Stark, and each of them, as proxies, each with the power to appoint his substitute, to represent and to vote as designated below, all the shares of Common Stock of Nationwide Health Properties, Inc. held of record by the undersigned on March 10, 1995, at the Annual Meeting of Stockholders to be held on April 21, 1995 and at any adjournment thereof. 1. ELECTION OF DIRECTORS FOR each nominee listed below WITHHOLD AUTHORITY (except as marked to the contrary below)[_] To vote for each nominee below[_] MILTON J. BROCK, JR., DAVID R. BANKS AND JACK D. SAMUELSON (INSTRUCTION: To withhold authority to vote for any individual nominee, write that nominee's name on the space provided below.) ------------------------------------------------------------------ 2. APPROVAL OF [_] DISAPPROVAL OF [_] ABSTENTION WITH RESPECT TO [_] the proposal to ratify the selection of Arthur Andersen LLP as independent accountants for the year ending December 31, 1995. 3. In their discretion, the proxies are authorized to vote upon such other business as may properly come before the meeting and at any adjournment thereof. This Proxy when properly executed will be voted in the manner directed herein by the undersigned. If no specification is made, the Proxy will be voted FOR proposals 1 and 2. If any nominee named above declines or is unable to serve as a director, the persons named as proxies, and each of them, shall have full discretion to vote for any other person who may be nominated. NOTE: Please sign exactly as name appears on this Proxy. When shares are held by joint tenants, both should sign. When signing as attorney, executor, administrator, trustee or guardian, please give full title as such. If a corporation, please sign in full corporate name by president or other authorized officer. If a partnership, please sign in partnership name by authorized person. Dated: , 1995 ------------------------------------ ------------------------------------ Signature of Stockholder(s) Please sign, date and return today in the enclosed envelope. This Proxy will not be used if you attend the meeting in person and so request. - -------------------------------------------------------------------------------- -----END PRIVACY-ENHANCED MESSAGE-----