Issuance of $175M Notes on December 30, 2005
UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
WASHINGTON,
D.C. 20549
FORM
8-K
CURRENT
REPORT
Pursuant
to Section 13 or 15(d) of the
Securities
Exchange Act of 1934
Date
of
report (Date of earliest event reported): December
30, 2005
OMEGA
HEALTHCARE INVESTORS, INC.
(Exact
name of registrant as specified in charter)
Maryland
|
1-11316
|
38-3041398
|
(State
of incorporation)
|
(Commission
File Number)
|
(IRS
Employer
Identification
No.)
|
9690
Deereco Road
Suite
100
Timonium,
Maryland 21093
(Address
of principal executive offices / Zip Code)
(410)
427-1700
(Registrant’s
telephone number, including area code)
Check
the appropriate box below if the Form 8-K filing is intended to simultaneously
satisfy the filing obligation of the registrant under any of the following
provisions:
Written
communications pursuant to Rule 425 under the Securities Act.
Soliciting
material pursuant to Rule 14a-12 under the Exchange Act.
Pre-commencement
communications pursuant to Rule 14d—2(b) under the Exchange Act.
Pre-commencement
communications pursuant to Rule 13e—4(c) under the Exchange Act.
Item
1.01 Entry
into a Material Definitive Agreement
The
disclosure contained in “Item 2.03 Creation of a Direct Financial Obligation or
an Obligation under an Off-Balance Sheet Arrangement of a Registrant” and
Exhibits 4.1 and 4.2 to this Current Report on Form 8-K are incorporated in
this
Item 1.01 by reference.
Item
2.03 Creation
of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet
Arrangement of a Registrant
7%
Senior Notes due 2016
On
December 30, 2005, Omega Healthcare Investors, Inc. (“Omega”) issued $175
million aggregate principal amount of 7% Senior Notes due 2016 (the “Notes”) of
Omega through a private placement to qualified institutional buyers pursuant
to
Rule 144A and in offshore transactions pursuant to Regulation S, promulgated
under the Securities Act of 1933, as amended (the “Securities Act”). The Notes
were sold pursuant to a Purchase Agreement, dated December 20, 2005, by and
among Omega and its subsidiaries, as guarantors, to Deutsche Bank Securities
Inc., Banc of America Securities LLC and UBS Securities LLC (collectively,
the
“Initial Purchasers”), a copy of which is filed herewith as Exhibit 99.1 to this
Current Report on Form 8-K and incorporated in this Item 2.03 by reference.
The
Notes were sold at an issue price of 99.109% of the principal amount of the
notes, resulting in gross proceeds to Omega of $173.4 million.
The Notes bear an interest rate of 7%, payable semi-annually in arrears on
January 15 and July 15 of each year, commencing on July 15, 2006. Interest
on
the Notes will accrue from December 30, 2005. The Notes mature on January 15,
2016. The Notes are unconditionally guaranteed, jointly and severally, on a
senior unsecured basis by Omega and its subsidiaries until certain conditions
are met.
The
Notes
are Omega’s unsecured senior obligations and rank equally with all of Omega’s
existing and future senior debt, and senior to all of Omega’s existing and
future subordinated debt. The Notes are, and will be, effectively subordinated
to Omega’s existing and future secured debt. The Notes are, and will be,
unconditionally guaranteed by Omega’s existing and future subsidiaries that
guarantee Omega’s Senior Credit Facility (as defined below) or any of Omega’s
other indebtedness. These guarantees are unsecured senior obligations of the
guarantors and rank equally with existing and future unsecured senior debt
of
such guarantors, and senior to all existing and future subordinated debt of
such
guarantors. The guarantees are effectively subordinated to existing and future
secured debt of the guarantors.
Omega
intends to use the net proceeds from the sale of the Notes to (i) repurchase
its
$100 million aggregate principal amount of 6.95% notes due 2007, including
the
payment of applicable premiums and consent fees related to the repurchase,
(ii)
repay a portion of its outstanding indebtedness under its Credit Agreement,
dated as of March 22, 2004, (as amended from time to time, the “Senior Credit
Facility”), among OHI Asset, LLC, OHI Asset (ID), LLC, OHI Asset (LA), LLC, OHI
Asset (TX), LLC, OHI Asset (CA), LLC, Delta Investors I, LLC, Delta Investors
II, LLC, the lenders identified therein and Bank of America, N.A., as
Administrative Agent, (iii) for working capital and general corporate purposes
and (iv) to pay related fees and expenses. Bank of America, N.A. is an affiliate
of Banc of America Securities LLC. In addition, each of the other Initial
Purchasers serve in various agent capacities under the Senior Credit
Facility.
The
Notes
are issued pursuant to an Indenture dated as of December 30, 2005 (the
“Indenture”) between Omega and U.S. Bank National Association, as trustee (the
“Trustee”).
The
terms
of the Notes, summarized below, are governed by the Indenture. The Indenture
contains certain covenants that limit the ability of Omega and its Restricted
Subsidiaries (as defined therein) to, among other things, incur debt; incur
secured debt; make certain dividend payments, distributions and investments;
enter into certain transactions, including transactions with affiliates;
restrict dividends or other payments from subsidiaries; merge, consolidate
or
transfer all or substantially all of their respective assets; and sell assets.
Upon the occurrence of certain types of changes of control, the Indenture
requires Omega to make an offer to repurchase the Notes at 101% of the principal
amount thereof, plus any accrued and unpaid interest to the repurchase date,
unless certain conditions are met.
Except
as
described below, Omega does not have any right to redeem the Notes prior to
January 15, 2011. The Indenture allows the Issuers to redeem the Notes, in
whole
at any time or in part from time to time, at redemption prices of 103.5%,
102.333% and 101.167% of the principal amount thereof if the redemption occurs
during the respective 12-month periods beginning on January 15 of the years
2011, 2012 and 2013 and at a redemption price of 100% of the principal amount
thereof on and after January 15, 2014, in each case, plus any accrued and unpaid
interest to the redemption date. In addition, Omega may redeem up to 35% of
the
Notes before January 15, 2009 with net cash proceeds from certain equity
offerings at a redemption price of 107% of the principal amount of the Notes
to
be so redeemed, plus any accrued and unpaid interest to the redemption
date.
The
Indenture contains customary events of default including, without limitation,
failure to make required payments, failure to comply with certain agreements
or
covenants, cross-defaults to certain other indebtedness in excess of specified
amounts, certain events of bankruptcy and insolvency, and failure to pay certain
judgments. An event of default under the Indenture will allow either the Trustee
or the holders of at least 25% in principal amount of the then outstanding
Notes
to accelerate, or in certain cases, will automatically cause the acceleration
of, the amounts due under the Notes.
The
foregoing description of the Notes and the Indenture is qualified by reference
in its entirety to the Indenture, a copy of which is filed as Exhibit 4.1 to
this Current Report on Form 8-K and is incorporated by reference
herein.
Registration
Rights Agreement
On
December 30, 2005, Omega, its subsidiaries and the Initial Purchasers entered
into a Registration Rights Agreement (the “Registration Rights Agreement”),
pursuant to which Omega and its subsidiaries agreed to file with the Securities
and Exchange Commission (the “Commission”) a registration statement (the
“Exchange Offer Registration Statement”) under the Securities Act relating to
the registration of a new series of 7% Senior Notes due 2016 (the “Exchange
Notes”), with terms substantially similar to the Notes, within 90 days following
the issuance of the Notes. Upon the effectiveness of the Exchange Offer
Registration Statement, Omega and its subsidiaries, pursuant to an exchange
offer (the “Exchange Offer”), are required to offer to the holders of the Notes
who are able to make certain representations the opportunity to exchange their
Notes for Exchange Notes. Omega and its subsidiaries are required to use their
commercially reasonable efforts to have the Exchange Offer Registration
Statement declared effective by the Commission on or prior to 180 days after
December 30, 2005. Unless the Exchange Offer would not be permitted by
applicable law or Commission policy, Omega and its subsidiaries must commence
the Exchange Offer and use their best efforts to issue within 30 business days,
or longer if required by the federal securities laws, after the date on which
the Exchange Offer Registration Statement is declared effective by the
Commission, Exchange Notes in exchange for all Notes tendered prior thereto
in
the Exchange Offer. If the Exchange Offer is prohibited by applicable law or
Commission policy, or is otherwise not consummated within 210 days following
the
issuance of the Notes, Omega and its subsidiaries are required to file with
the
Commission a shelf registration statement (“Shelf Registration Statement”) to
cover resales of the Notes by the holders of the Notes who satisfy certain
conditions relating to the provision of information in connection with such
Shelf Registration Statement. If so obligated, Omega and its subsidiaries are
required to use their best efforts to file the Shelf Registration Statement
with
the Commission on or prior to 60 days after such filing obligation arises and
to
cause such shelf registration to be declared effective by the Commission on
or
prior to 60 days after such shelf registration was filed.
If
Omega
and its subsidiaries fail to satisfy any of the obligations described above
on a
timely basis, Omega and its subsidiaries are required to pay liquidated damages
in the form of additional interest on the Notes to the holders of the Notes
under certain circumstances. Omega and its subsidiaries must pay liquidated
damages on the Notes if: (i) the Exchange Offer Registration Statement is not
filed with the Commission within 90 days following the issuance of the Notes
or
the Shelf Registration Statement is not filed within 60 days after such filing
obligation arises, (ii) the Commission declares neither the Exchange Offer
Registration Statement nor the Shelf Registration Statement effective on or
prior to the 180th
day
following the issuance of the Notes, or (iii) the Exchange Offer is not
consummated on or prior to the 45th
business
day following the date of effectiveness of the Exchange Offer Registration
Statement.
The
foregoing description of the Registration Rights Agreement is qualified by
reference in its entirety to the Registration Rights Agreement, a copy of which
is filed herewith as Exhibit 4.2 and incorporated in this Item 2.03 by
reference.
Item
8.01 Other
Events
Omega
announced on November 28, 2005 its offering of an additional $50 million
aggregate principal amount of its 7% senior notes due 2014 (the “Add-on
Offering”) to be issued in a private placement. The Add-on Offering subsequently
closed on December 2, 2005. A copy of the press release announcing the Add-on
Offering is attached to this Current Report on Form 8-K as Exhibit 99.2 and
is
incorporated by reference herein.
Item
9.01 Exhibits
4.1 Indenture,
dated as of December 30, 2005, among Omega Healthcare Investors, Inc., each
of
the subsidiary guarantors listed therein and U.S. Bank National Association,
as
trustee.
4.2 Registration
Rights Agreement, dated as of December 30, 2005, by and among Omega Healthcare,
the Guarantors named therein, and Deutsche Bank Securities Inc., Banc of America
Securities LLC and UBS Securities LLC, as Initial Purchasers.
99.1 Purchase
Agreement, dated December 20, 2005, by and among Omega and its subsidiaries,
as
guarantors, and Deutsche Bank Securities Inc., Banc of America Securities LLC
and UBS Securities LLC, as Initial Purchasers.
99.2 Press
Release dated November 28, 2005.
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.
OMEGA
HEALTHCARE INVESTORS, INC.
(Registrant)
Dated:
January 4, 2006 By: /s/
C.
Taylor Pickett
C.
Taylor
Pickett
President
and Chief Executive Officer
EXHIBIT
INDEX
Exhibit
Number Description
4.1 Indenture,
dated as of December 30, 2005, among Omega Healthcare Investors, Inc., each
of
the subsidiary guarantors listed therein and U.S. Bank National Association,
as
trustee.
4.2 Registration
Rights Agreement, dated as of December 30, 2005, by and among Omega Healthcare,
the Guarantors named therein, and Deutsche Bank Securities Inc., Banc of America
Securities LLC and UBS Securities LLC, as Initial Purchasers.
99.1 Purchase
Agreement, dated December 20, 2005, by and among Omega and its subsidiaries,
as
guarantors, and Deutsche Bank Securities Inc., Banc of America Securities
LLC
and UBS Securities LLC, as Initial Purchasers.
99.2 Press
Release dated November 28, 2005.