Discussion of approach to measuring, incentivizing, and improving sustainability impacts of tenants

As a triple-net landlord, our third-party operators have control and responsibility for the properties in our real estate portfolio on a day-to-day basis. While our ability to mandate environmental changes to their operations is limited, our tenants are contractually bound to preserve and maintain our properties in good working order and condition. In connection with this, they are generally required to meet or exceed annual expenditure thresholds on capital improvements and enhancements of our properties. Compliance with this requirement alone, in certain cases, produces improvements in the environmental performance of our properties and reduces energy usage, water usage, and direct and indirect greenhouse gas (GHG) emissions.

Our asset management team seeks to monitor and enforce these contractual requirements, through both Omega personnel and third-party inspectors periodically visiting our properties. These visits focus on ensuring that our properties are being suitably maintained and sometimes result in corrective repair and replacement recommendations. We require that these corrections and replacements comply with local building codes, which often results in the incorporation of sustainable improvements into our properties.

Omega has implemented a capital expenditure sustainability initiative to encourage operators to invest in financially beneficial and environmentally enhancing investment projects. The idea is to financially incentivize operators, through discounts on our standard cost of capital, to invest in sustainable capital projects that provide a favorable return on investment while reducing the environmental footprint of these operations. We have engaged third party consultants to provide recommendations as to what investments provide this combination of economic and environmental benefit. However, we have also encouraged our operators to propose their own suggestions, which we will evaluate based on the extent of the environmental impact. Finally, given the broad geographic dispersion and general lack of direct competition that exists among many of our operators, we are encouraging them to share environmental best practices. Further, we expect to showcase some of these environmental investments at our operator conference, which is generally held biennially, to highlight ways in which financial and environmental efforts can be aligned.

Discussion and analysis on use of Phase I and Phase II Environmental Site Assessments (ESAs)

As a triple-net landlord, our third-party operators have control and responsibility for the properties in our real estate portfolio. Our due diligence on all real estate acquisitions includes Phase I and, where appropriate, Phase II environmental assessments (ESAs) as part of our analysis to understand the environmental condition of the property, including whether there is indication of any release of hazardous substances, chemical or waste storage, or other environmental concerns or risks, and to determine whether the property meets certain environmental standards. In the event that our due diligence uncovers environmental contamination, we work with the sellers and/or operators to mitigate any issues.

Because our portfolio is primarily comprised of SNFs, the operations in our facilities are also subject to stringent health regulation and oversight by state regulators, which lowers the risk of environmental contamination onsite.

All of our leases or agreements contain provisions requiring compliance with applicable health and safety laws. In addition, since 2015, 56% of Omega’s development capital has been allocated to facilities built to LEED certification standards.

Physical Climate Risk

Discussion and analysis of physical climate risk to properties and insurance requirements

We regularly monitor the impact of significant natural disasters on our properties. In most leases our tenants are required to carry full replacement cost coverage on all improvements located on our properties. For those properties located in a nationally designated flood zone, we typically require our tenants to carry flood insurance pursuant to the federal flood insurance program. For those properties located in an area of high earthquake risk, we typically require our tenants to carry earthquake insurance above what is traditionally covered in an extended coverage policy.

Area of properties/facilities located in FEMA designated 100-year flood zones, by property subsector¹

[IF-RE-450a.1]

For 2022, approximately 6% of properties were located in 100 Year Flood Zones. Of these properties, 94% are SNFs. Put another way, in 2022, about 5% of annualized rent and about 5% of gross real estate investment balance were located in these defined at-risk geographies.

Our corporate goal is to derive less than 10% of rental income from properties in FEMA designated 100-year flood zones.

Description of climate change risk exposure analysis, degree of systematic portfolio exposure, and strategies for mitigating risks

[IF-RE-450a.2]

During the due diligence process, we seek to evaluate the risk of physical, natural disaster or extreme weather patterns on the properties we are looking to acquire and whether there are specific risks to that property or region that need to be mitigated. Through insurance and property- specific safety measures - for example, hurricane shutters, earthquake-compliant construction, elevated generators - we seek to ensure that the real estate is both protected and fit for purpose.

1. 100-year flood zones are defined as land areas subject to a one percent or greater chance of flooding in any given year. For properties located in the U.S., 100-year flood zones shall include those land areas designated by the U.S. Federal Emergency Management Agency (FEMA) as special flood hazard areas (SFHA).

As a triple-net landlord, our third-party operators have control and responsibility for the properties in our real estate portfolio. Our due diligence on all real estate acquisitions includes Phase I and, where appropriate, Phase II environmental assessments (ESAs) as part of our analysis to understand the environmental condition of the property, including whether there is indication of any release of hazardous substances, chemical or waste storage, or other environmental concerns or risks, and to determine whether the property meets certain environmental standards. In the event that our due diligence uncovers environmental contamination, we work with the sellers and/or operators to mitigate any issues.

Human Capital Support & Development

The success we have achieved as a company is based on the focused passion and dedication of our people. Our employees’ commitment to Omega provides better service to our tenants and stakeholders, creates an inclusive and collegial working environment and generates long-term value for our shareholders and the communities which we serve. See our Human Capital Support & Development Policy for more information.

Employee Training & Professional Development

All senior management receive one-on-one coaching from both the VP, HR and an external consultant who specializes in the executive coaching discipline. In 2022, all senior management participated in an offsite leadership summit. The event consisted of engaging leadership topic sessions delivered by subject matter experts.

We encourage employees to keep current in their professions by either acquiring the appropriate certification (CPA, SHRM-SCP, etc.) and/or taking the appropriate classes/training to attain CPEs, CLEs, PDCs, etc. We also offer an annual tuition reimbursement program and reimbursement of certain professional development expenses. All employees are allotted $5,000 a year to seek out professional development classes or seminars to enhance their skills and knowledge.

All employees participate in our annual performance review process that consists of self-evaluation, supervisor evaluation and a discussion on overall performance along with potential career pathing.

Compensation & Benefits

Omega provides an extremely competitive benefits program including Medical, Dental and Vision coverage, a nondiscretionary 401k with an employer match, 12 weeks of paid parental leave to all employees upon the birth or adoption of a child, Flexible Spending Accounts, Employer-funded life and disability insurance, hospital indemnity, supplemental long-term disability insurance, generous personal time off, flexible working hours and location, mother’s room (breast-feeding/ lactation facility), and corporate discounts.

Healthcare insurance covers fertility services, contraception and gender reassignment services. To promote health and wellbeing, we also offer free access to our headquarters’ gym, which is coupled with annual exercise and health drives. Every employee has a standing desk and an ergonomic chair.

To attract, retain and award our talent, Omega’s Employee Stock Purchase Program allows all eligible employees, with the exception of our NEOs, to buy company stock, subject to the terms of the plan, at a discount up to the lower of 20% of their salary or $25,000.

Diversity & inclusion Initiatives¹

Omega has a long-standing commitment to being an equal opportunity employer and has implemented Equal Employer Opportunity policies. In 2021, Omega conducted diversity and inclusion training for our Board members and employees, with 100% completion.

In 2020, our CEO, C. Taylor Pickett, reinforced our diversity and inclusion commitment by signing the CEO Action for Diversity and Inclusion Pledge, one of the largest CEO-driven business commitments to act on and advance diversity, equity and inclusion in the workplace. In addition, in 2020, the Company implemented several initiatives to further its commitment to diversity and inclusion within its workforce and Board, in its local community and in the industry in which it operates, particularly in light of the racial and social justice challenges that were highlighted in 2020 and during the pandemic.

Omega has expanded its recruitment practices to reach more diverse candidates for employment and Board positions and developed an internship program with a focus on increasing diversity in the pipeline of eligible employees. At the executive level, one of Omega’s four NEOs is a woman and brings racial diversity to the team, and at the senior management level, 25% are women and 25% bring racial diversity to the team. We generally report to the full board quarterly on our workforce diversity efforts. In addition, in 2020 we expanded our holiday calendar to include Juneteenth as a paid holiday and encouraged team members to utilize the additional time to learn more about the holiday.

Equitable Compensation

Omega regularly conducts pay equity reviews as we seek to ensure women and men, on average, at various roles and levels of the Company, are paid equitably for their roles and contributions to our success. When a difference is uncovered in total compensation (across base, bonuses and equity), the Company seeks to remediate the gap in order to achieve pay parity.¹

Employee Demographic²

Age Demographic²

1. Ratio of base salaries
2. As of December 2023.

Employee Engagement

Omega conducts an annual employee engagement survey. We share the results with our board of directors, and the management team.

The management team uses the employee engagement survey and its participation rates and overall score to help shape and improve elements of the business, correlated with employee needs, based on the results and feedback of the survey. Below, we provide these figures from our employee engagement survey for the last three years.

By employing a year over year look, the management team can determine the workplace climate, trends both in areas of opportunity and positivity, then strategize on a human capital management plan with a focus on employee engagement and retention.

In addition to the survey, we hold employee town hall meetings generally twice a year. These are generally attended by all employees. During these meetings, the management team provides updates on key elements of the business. In addition, the management team encourages employee questions or comments.

1. Based on Gallup Poll survey conducted periodically of the existing employee base.
2. Involuntary turnover is defined as termination of employment by the company. Voluntary turnover is defined as employees who chose to resign from their position (excluding retirement).
3. Percentage of women who remained employed at Omega (excluding those who retired).
4. Female employees who work in roles directly impacting the company’s revenues, excluding support staff – as per Bloomberg Gender Equality Index definition.

Community

We have invested in several local charitable partnerships to improve economic, health and social outcomes in the local Baltimore, Maryland community, with a focus on the diverse local community and historically underrepresented communities.

Industry

Omega continues to sponsor Administrators in Training programs (AITs) at select facilities in partnership with operators. This program offers its participants the opportunity to develop the skillsets to lead operations at skilled nursing facilities and aims to enhance under-represented groups in senior roles at our properties. Since we began this program in 2020, Omega has sponsored eight AITs. Six individuals have completed training and have been, or are in the process of being, placed at a facility. Currently, two are in the training or selection process.

Additionally, we have committed as a Founding Donor to support Nareit’s Dividends Through Diversity, Equity & Inclusion program,  which supports charitable and educational organizations and initiatives that will help create a more diverse, equitable, and inclusive REIT and publicly traded real estate industry. Members of management serve on Nareit’s Corporate Governance Council and Real Estate Sustainability Council.

Philanthropic & Charitable Initiatives

In 2020, Omega established, “The Omega Healthcare Investors Business Scholarship Fund”, an undergraduate scholarship fund for students at a local historically Black university. Omega funded a $100,000 per year commitment for 5 years. In 2022, Omega donated over $21,000 to Alzheimer’s related charities. In addition, each year Omega provides five charities that support diverse local communities with $10,000 each, provides a holiday charitable gift of $10,000 to a local charity, and provides a company match of up to $2,500 per employee in our Charitable Giving & Match program.

Ethics & Risk Management

• Code of Ethics: Our Code of Business Conduct and Ethics applies to our directors, officers and employees.
• Whistleblower Policy: We maintain a whistleblower hotline and website administered by a third-party, which permits anonymous reporting of concerns.
• Human Rights Policy: Our Human Rights Policy is informed by reference to third-party international organizations.
• Enterprise Risk Management: Our Board reviews the Company’s risks and enterprise risk management processes regularly.
• Vendor Code of Conduct: We implemented a Vendor Code of Conduct in 2021 aimed at improving corporate social responsibility among our key vendors and aligning their practices with our policies.

Total amount of monetary losses as a result of legal judgements associated with corruption and bribery

For each of the last three years, the Company has not experienced monetary losses as a result of legal proceedings associated with corruption and bribery.

Political Contributions Policy

Omega does not permit the illegal use of Company funds or property for the support of political parties or political candidates for any office (federal, state or local) in the United States or any foreign country. No director, officer or employee is authorized to make or approve such a contribution. See Section C, page 4, of our Code of Business Conduct & Ethics for more information.

Omega’s Vice President of Technology is responsible for overseeing our information security program, which we aim to align with industry recognized cybersecurity frameworks. In addition, we maintain an Information Security Incident Response Plan, and have established information security/cybersecurity policies that are internally available to all employees. We conduct cybersecurity training for all employees at least annually. Additionally, we conduct regular cyber risk assessments through our cyber insurance carrier and conduct internal phishing and cyber tests to monitor vigilance of our employees. We employ an escalation process which employees can follow in the event an employee notices something suspicious, and conduct periodic assessments by third parties to assess our vulnerability management and security controls and to assist us in identifying and mitigating security risks. We generally hold corporate townhalls at least twice a year where employees are encouraged to recommend system changes to mitigate corporate risks; and employees may use an anonymous whistleblower hotline and website to raise potential concerns, threats, and risks.

Our Audit Committee has primary oversight of the Company’s information security and privacy efforts as they relate to financial reporting, and reviews and discusses the program with management quarterly, with the board providing general oversight of information security and privacy. Our management team reports to the Board on these efforts at least annually.

It is Omega’s overall goal to meet and exceed expectations of its stakeholders, while continuing to build its reputation as a responsible member of the global business community. Our global tax strategy is intended to help facilitate this goal, while treating existing and potential jurisdictions as stakeholders and balancing their needs and concerns with those of the Company and the rest of its stakeholders.

See our Global Tax Strategy for more information.

For each of the last three years, our Say-on-Pay advisory vote support¹ has totaled over 95%.

Compensation Practices

• Stock Ownership Guidelines: We maintain stock ownership guidelines for our senior officers and our non-employee directors.
• Clawback Policy: Our Board has voluntarily adopted a formal clawback policy that applies to executive incentive compensation.
• Anti-Hedging and Anti-Pledging: Our directors, officers and employees are subject to anti-hedging and anti-pledging policies.
• Annual Say-on-Pay: We annually submit “say-on-pay” advisory votes for our shareholders’ consideration and vote.

1. As a percentage of votes cast.

Board Structure

• Independence (%): 88%
• Diversity (%): 38%. Our Nominating and Corporate Governance Committee endeavors to identify nominees that possess diverse educational backgrounds, business experiences, life skills, as well as diverse gender, racial, sexual orientation, national origin and ethnic characteristics.
• Annual Election of Directors: Our Board consists of a single class of directors who stand for election each year.
• Opted-out of Maryland Unsolicited Takeover Act: In November 2019, the Board opted out of the provisions of the Maryland Unsolicited Takeovers Act that otherwise would permit the Board, without shareholder approval, to divide the Board into three classes serving staggered three-year terms.
• Majority Voting Standard for Direction Elections: Our Bylaws include a majority voting standard for the election of directors in uncontested elections. Any incumbent director who fails to receive the required vote for re-election must offer to resign from the Board. Stockholders can vote for, against or abstain from voting on each nominee.
• Chair of the Board and CEO Roles Separated: Our independent Chair of the Board provides independent leadership for our Board.

Board Diversity 2015 vs. 2023

Board Diversity 2015 vs. 2023

Board Diversity 2015 vs. 2023

1. As of June, 2023.

• No Poison Pill: We do not have a “poison pill” shareholder rights plan in effect.
• Shareholder Amendments to Bylaws: Our Bylaws may be amended by shareholder vote.
• Shareholder-Requested Special Meetings: Our shareholders have the ability to call a special meeting of shareholders in accordance with the process set forth in the Bylaws.
• Proxy Access Bylaws: Stockholders meeting certain eligibility requirements have the right to nominate equal to the greater of two director seats or 20% of the Board with the process set forth in the Bylaws.
• One Share, One Vote: All issued shares have equal voting rights.