S-3: Registration statement for specified transactions by certain issuers
Published on February 3, 1997
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON FEBRUARY 3, 1997
REGISTRATION NO.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
------------------------
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
------------------------
OMEGA HEALTHCARE INVESTORS, INC.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
------------------------
COPIES OF COMMUNICATIONS TO:
DON M. PEARSON, ESQ.
WILLIAM A. JONES, ESQ.
ARGUE PEARSON HARBISON & MYERS, LLP
801 SOUTH FLOWER STREET
LOS ANGELES, CALIFORNIA 90017
(213) 622-3100
------------------------
PURSUANT TO RULE 429, THIS REGISTRATION STATEMENT
ALSO UPDATES REGISTRATION STATEMENT FILE NO. 3373532
------------------------
If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. [ ]
If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, check the following box. [X]
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. [ ]
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [ ]
If delivery of the prospectus is expected to be made pursuant to Rule 4334,
please check the following box. [ ]
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL
FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF
THE SECURITIES ACT OF 1933 OR UNTIL THIS REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(A),
MAY DETERMINE.
CALCULATION OF REGISTRATION FEES
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
(1) In no event will the aggregate maximum offering price of all securities
issued pursuant to this Registration Statement exceed $150,000,000 or, if
any Debt Securities are issued with original issue discount, such greater
(Cover page continued on next page)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
amount as shall result in an aggregate offering price of $150,000,000. Any
securities registered hereunder may be sold separately or as units with
other securities registered hereunder. In addition to the $150,000,000
aggregate maximum offering price of all Securities being registered hereby,
the Prospectus contained herein also updates and relates to, pursuant to
Rule 429, $1,750,000 aggregate maximum offering price of securities
registered in Registration Statement File No. 33-73532, with respect to
which a filing fee of $6703.45 was paid, in connection with the filing of
that Registration Statement.
(2) Subject to Footnote (1), there is being registered hereunder an
indeterminate number of shares of Common Stock as may be sold, from time to
time, by the Registrant. There is also being registered hereunder an
indeterminate number of shares of Common Stock as shall be issuable upon
conversion of the Preferred Stock or Debt Securities or exercise of
Securities Warrants registered hereby.
(3) The proposed maximum offering price per unit will be determined, from time
to time, by the Registrant in connection with the issuance by the Registrant
of the securities registered hereunder.
(4) Subject to Footnote (1), there is being registered hereunder an
indeterminate number of shares of Preferred Stock (par value of $1.00 per
share) as may be sold, from time to time, by the Registrant. There is also
being registered hereunder an indeterminate number of shares of Preferred
Stock as shall be issuable upon conversion of Debt Securities or exercise of
Securities Warrants registered hereby.
(5) Subject to Footnote (1), there is being registered hereunder an
indeterminate principal amount of Debt Securities.
(6) Subject to Footnote (1), there is being registered hereunder an
indeterminate number of Common Stock Warrants, Preferred Stock Warrants, and
Debt Securities Warrants representing rights to purchase Common Stock,
Preferred Stock, and Debt Securities, respectively, registered pursuant to
this Registration Statement.
(7) Calculated pursuant to Rule 457(o) of the rules and regulations under the
Securities Act of 1933, as amended.
OMEGA HEALTHCARE INVESTORS, INC.
Cross Reference Sheet showing location in Prospectus of Information
Required by Form S-3.
PROSPECTUS
OMEGA HEALTHCARE INVESTORS, INC.
COMMON STOCK, PREFERRED STOCK,
DEBT SECURITIES AND SECURITIES WARRANTS
Omega Healthcare Investors, Inc. (the "Company") may from time to time
offer in one or more series (i) shares of its common stock, par value $.10 per
share (the "Common Stock"); (ii) shares of its preferred stock, par value $1.00
per share (the "Preferred Stock"); (iii) its unsecured debt securities (the
"Debt Securities"); or (iv) warrants to purchase Common Stock (the "Common Stock
Warrants"), warrants to purchase Debt Securities (the "Debt Securities
Warrants"), and warrants to purchase Preferred Stock (the "Preferred Stock
Warrants"), with an aggregate public offering price of up to $150,000,000, on
terms to be determined at the time of offering. The Common Stock Warrants, the
Debt Securities Warrants and the Preferred Stock Warrants shall be referred to
herein collectively as the "Securities Warrants." The Common Stock, Preferred
Stock, Debt Securities, and Securities Warrants (collectively, the "Securities")
may be offered, separately or together, in separate series amounts, at prices
and on terms to be set forth in a supplement to this Prospectus (a "Prospectus
Supplement").
(continued on next page)
------------------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE COMMISSION OR
ANY STATE SECURITIES COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF THIS
PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
------------------------
THE ATTORNEY GENERAL OF THE STATE OF NEW YORK HAS NOT PASSED ON OR
ENDORSED THE MERITS OF THIS OFFERING. ANY REPRESENTATION
TO THE CONTRARY IS UNLAWFUL.
------------------------
THIS PROSPECTUS MAY NOT BE USED TO CONSUMMATE SALES OF SECURITIES
UNLESS ACCOMPANIED BY A PROSPECTUS SUPPLEMENT.
------------------------
THE DATE OF THIS PROSPECTUS IS JANUARY 31, 1997
The terms of the Preferred Stock, including specific designation and stated
value per share, any dividend, liquidation, redemption, conversion, voting and
other rights, and all other specific terms of the Preferred Stock will be set
forth in the applicable Prospectus Supplement. In the case of the Debt
Securities, the specific title, aggregate principal amount, form (which may be
registered or bearer, or certified or global), maturity, rate (or manner of
calculation thereof) and time of payment of interest, terms for redemption at
the option of the Company or repayment at the option of the Holder, any sinking
fund provisions and any conversion provisions will be set forth in the
applicable Prospectus Supplement. In the case of the Securities Warrants, the
duration, offering price, exercise price and detachability, if applicable, will
be set forth in the applicable Prospectus Supplement. In addition, such specific
terms may include limitations on direct or beneficial ownership and restrictions
on transfer of the Securities or redemption or conversion terms, in each case as
may be appropriate to preserve the status of the Company as a real estate
investment trust ("REIT") for United States federal income tax purposes. The
applicable Prospectus Supplement will also contain information, where
applicable, about certain United States federal income tax considerations
relating to, and any listing on a securities exchange of, the Offered Securities
covered by such Prospectus Supplement.
In the case of Securities Warrants, the duration, offering price, exercise
price and detachability, if applicable, will be set forth in the applicable
Prospectus Supplement. In addition, such specific terms may include limitations
on direct or beneficial ownership and restrictions on transfer of the
Securities, in each case as may be appropriate to preserve the status of the
Company as a real estate investment trust ("REIT") for United States federal
income tax purposes. The applicable Prospectus Supplement will also contain
information, where applicable, about certain United States federal income tax
considerations relating to, and any listing on a securities exchange of, the
Securities covered by such Prospectus Supplement.
Securities may be offered directly, through agents designated from time to
time by the Company, or to or through underwriters or dealers. If any agents or
underwriters are involved in the sale of any of the Securities, their names, and
any applicable purchase price, fee, commission or discount arrangement between
or among them, will be set forth, or will be calculable from the information set
forth, in the applicable Prospectus Supplement. See "Plan of Distribution." No
Securities may be sold without delivery of the applicable Prospectus Supplement
describing the method and terms of the offering of such series of Securities.
The net proceeds to the Company from the sale of any of the Securities will be
set forth in the applicable Prospectus Supplement.
2
AVAILABLE INFORMATION
The Company is subject to the informational requirements of the Securities
Exchange Act of 1934 and in accordance therewith, files reports, proxy
statements and other information with the Securities and Exchange Commission
(the "Commission"). Such reports, proxy statements and other information can be
inspected and copied at the public reference facilities maintained by the
Commission in Washington, D.C. (Judiciary Plaza, 450 Fifth Street, N.W.,
Washington, D.C. 20549), and at the Commission's Regional Offices in Chicago
(500 West Madison Street, Suite 1400, Chicago, Illinois 60665) and New York City
(7 World Trade Center, 13th Floor, New York, New York 10048). Copies of such
material can be obtained from the Commission's Public Reference Section, 450
Fifth Street, N.W., Washington, D.C. 20549 at prescribed rates. The common stock
of the Company is listed on the New York Stock Exchange and reports, proxy
statements and other information concerning Omega Healthcare Investors, Inc. can
be inspected at 20 Broad Street, New York, New York. The Company has filed with
the Commission a Registration Statement on Form S-3 with respect to the
securities offered hereby. This Prospectus and any accompanying Prospectus
Supplement do not contain all information set forth in the Registration
Statement, in accordance with the rules and regulations of the Commission, and
exhibits thereto which the Company has filed with the Commission under the
Securities Act of 1933 and to which reference is hereto made.
DOCUMENTS INCORPORATED BY REFERENCE
The following documents previously filed with the Commission are
incorporated in this Prospectus by reference:
- Annual Report of the Company on Form 10-K for the year ended December 31,
1995;
- Quarterly Reports of the Company on Form 10-Q for the quarters ended
March 31, 1996, June 30, 1996, and September 30, 1996;
- Current Reports of the Company on Form 8-K dated June 10, 1996, and
January 19, 1996; and
- The description of the Company's Common Stock, $.10 par value, contained
in its Initial Registration Statement on Form 8-A, filed under Section 12
of the Securities Exchange Act of 1934, and declared effective by the
Commission on August 7, 1992.
All documents filed by Omega Healthcare Investors, Inc. pursuant to Section
13(a), 13(c), 14 or 15(d) of the Securities Exchange Act of 1934 subsequent to
the date hereof and prior to the termination of the offering made hereby shall
be deemed to be incorporated by reference into this Prospectus and to be a part
hereof from the date of filing such documents. All information appearing in this
Prospectus is qualified in its entirety by the detailed information and
financial statements (including the notes thereto) appearing in the documents
incorporated by reference. Any statement contained in a document incorporated or
deemed to be incorporated by reference herein shall be deemed to be modified or
superseded for purposes of this Prospectus to the extent that a statement
contained herein or in any other subsequently filed document which also is or is
deemed to be incorporated by reference herein modifies or supersedes such
statement. Any statement so modified or superseded shall not be deemed, except
as so modified or superseded, to constitute a part of this Prospectus.
Omega Healthcare Investors, Inc. will provide without charge to each person
to whom this Prospectus is delivered, on written or oral request of such person,
a copy (without exhibits other than exhibits specifically incorporated by
reference therein) of any or all documents incorporated by reference into this
Prospectus within the meaning of Section 10(a) of the Securities Act of 1933.
Requests for such copies should be directed to Essel W. Bailey, Jr., President
and Secretary of the Company, at the Company's principal executive offices at
905 West Eisenhower Circle, Suite 110, Ann Arbor, Michigan 48103, telephone
(313) 747-9790.
IN CONNECTION WITH THIS OFFERING, THE UNDERWRITERS MAY OVER-ALLOT OR EFFECT
TRANSACTIONS WHICH STABILIZE OR MAINTAIN THE MARKET PRICE OF THE SHARES OF THE
COMPANY AT LEVELS ABOVE THOSE WHICH MIGHT OTHERWISE PREVAIL IN THE OPEN MARKET.
SUCH TRANSACTIONS MAY BE EFFECTED ON THE NEW YORK STOCK EXCHANGE OR OTHERWISE.
SUCH STABILIZING, IF COMMENCED, MAY BE DISCONTINUED AT ANY TIME.
3
THE COMPANY
Omega Healthcare Investors, Inc. (the "Company") was incorporated in the
State of Maryland on March 31, 1992. It is a self administered real estate
investment trust ("REIT") which invests in income producing healthcare
facilities, principally long-term care facilities located primarily in the
United States.
As of December 31, 1996, the Company's portfolio of domestic investments
consisted of 214 long-term care facilities and 3 medical office buildings. The
Company owns and leases 132 long-term care facilities and 3 medical office
buildings, and provides mortgages, including participating and convertible
mortgages, on 82 long-term care facilities. The facilities are located in 24
states and operated by 34 unaffiliated operators. The Company is also an owner
of and provides management/advisory services to Principal Healthcare Finance
Limited which owns and leases 42 nursing homes in the United Kingdom. The
Company's gross investments at December 31, 1996 totaled $643.3 million.
The Company anticipates providing lease or mortgage financing in the future
for healthcare facilities to qualified operators, and also anticipates acquiring
additional healthcare facility types, including assisted living and acute care
facilities.
The investment objectives of the Company are: To pay regular cash dividends
to shareholders; to provide the opportunity for increased dividends from annual
increases in rental and interest income from revenue participations and from
portfolio growth; to preserve and protect shareholders' capital; and to provide
the opportunity to realize capital growth resulting from appreciation.
The Company intends to make and manage its investments (including the sale
or disposition of property or other investments) in such a manner as to be
consistent with the requirements of the Code (or regulations thereunder) to
qualify as a real estate investment trust ("REIT"), unless, because of changes
in circumstances or changes in the Code (or regulations thereunder), the Board
of Directors determines that it is no longer in the best interests of the
Company to qualify as a REIT.
The executive offices of the Company are located at 905 West Eisenhower
Circle, Suite 110, Ann Arbor, Michigan 48103. Its telephone number is (313)
747-9790.
INVESTMENT STRATEGIES AND POLICIES
The Company maintains a diversified portfolio of income-producing health
care facilities or mortgages thereon, with a primary focus on long-term care
facilities located primarily in the United States. In evaluating potential
investments, the Company considers such factors as: (i) the quality and
experience of management and the creditworthiness of the operator of the
facility; (ii) the facility's historical, current and forecasted cash flow and
its adequacy to meet operational needs, capital expenditures and lease or debt
service obligations, while providing a competitive return on investment to the
Company; (iii) the construction quality, condition and design of the facility;
(iv) the geographic area and type of facility; (v) the tax, growth, regulatory
and reimbursement environment of the community in which the facility is located;
(vi) the occupancy and demand for similar health care facilities in the same or
nearby communities; and (vii) the payor mix of private, Medicare and Medicaid
patients.
In making investments, the Company generally seeks established,
creditworthy, "middle market" health care operators which meet the Company's
standards for quality and experience of management. Although the Company has
emphasized long-term care investments, it will diversify prudently into other
types of health care investments. The Company actively seeks to diversify its
investments in terms of geographic location, operators and facility types.
A fundamental investment strategy of the Company is to obtain contractual
rent escalations under long-term, non-cancelable "triple net" leases and revenue
participations through participating mortgage loans, and to obtain substantial
security deposits. The Company may participate in mortgage loans through
ownership of collateralized mortgage obligations or other securitization of
mortgages.
The Company may determine to finance acquisitions through the exchange of
properties or the issuance of shares of its capital stock to others, if such
transactions otherwise satisfy the Company's investment criteria.
4
The Company also has authority to repurchase or otherwise reacquire its Common
Stock or any other securities and may determine to do so in the future.
To the extent that the Company's Board of Directors determines to obtain
additional capital, the Company may raise such capital through additional equity
offerings, debt financings or retention of cash flow (subject to provisions of
the Internal Revenue Code of 1986, as amended concerning the taxability of
undistributed income of "real estate investment trusts"), or a combination of
these methods.
The Bylaws of the Company permit the Board of Directors, without the
approval of the shareholders, to alter the Company's investment policies if they
determine in the future that such a change is in the best interests of the
Company and its shareholders. The methods of implementing the Company's
investment policies may vary as new investments and financing techniques are
developed or otherwise employed.
BORROWING POLICIES
The Company may incur additional indebtedness, and intends to eventually
attain and then maintain a long-term debt-to-capitalization ratio of
approximately 40%. The Company intends to review periodically its policy with
respect to its debt-to-capitalization ratio and to adapt such policy as its
management deems prudent in light of prevailing market conditions. The Company's
strategy generally has been to match the maturity of its indebtedness with the
maturity of its assets, and to employ long term, fixed rate debt to the extent
practicable.
The Company will use the proceeds of any additional indebtedness to provide
permanent financing for investments in additional health care facilities. The
Company may obtain either secured or unsecured indebtedness, which may be
convertible into capital stock or accompanied by warrants to purchase capital
stock. Where debt financing is present on terms deemed favorable, the Company
may invest in properties subject to existing loans, secured by mortgages, deeds
of trust or similar liens on the properties.
RATIO OF EARNINGS TO FIXED CHARGES
The ratio of earnings to fixed charges are as follows:
- ---------------
(1) Operations of the Company commenced on August 14, 1992.
(2) For purposes of calculating the ratio of earnings to fixed charges, net
earnings (before extraordinary charge from prepayment of debt in 1995) has
been added to fixed charges and that sum has been divided by such fixed
charges. Fixed charges consist of interest expense and amortization of
deferred financing costs.
USE OF PROCEEDS
Unless otherwise specified in the Prospectus Supplement which accompanies
this Prospectus, the net proceeds from the sale of the Securities offered from
time to time hereby will be used for the repayment of short term bank lines of
credit and general corporate purposes, including additional investments in
health care properties.
DESCRIPTION OF SECURITIES
The Company may offer under this Prospectus one or more of the following
categories of its Securities: (i) shares of its Common Stock, par value $0.10
per share; (ii) shares of its Preferred Stock, par value $1.00 per share, in one
or more series; (iii) Debt Securities, in one or more series; (iv) Common Stock
Warrants;
5
(v) Preferred Stock Warrants; (vi) Debt Warrants; and (vii) any combination of
the foregoing, either individually or as units consisting of one or more of the
types of Securities described in clauses (i) through (vi). The terms of any
specific offering of Securities, including the terms of any units offered, will
be set forth in a Prospectus Supplement relating to such offering.
The authorized capital stock of the Company currently consists of
50,000,000 shares of Common Stock, par value $0.10 per share, and 10,000,000
shares of Preferred Stock, par value $1.00 per share. As of December 31, 1996,
the Company had 18,175,268 shares of its Common Stock issued and outstanding.
The Common Stock is listed on the New York Stock Exchange. The Company intends
to list any additional shares of its Common Stock which are issued and sold
hereunder. No shares of the Company's Preferred Stock are outstanding. The
Company may list any Preferred Stock which is offered and sold hereunder, as
described in the Prospectus Supplement relating to such Preferred Stock.
COMMON STOCK
All shares of Common Stock participate equally in dividends payable to
stockholders of Common Stock when and as declared by the Board of Directors and
in net assets available for distribution to stockholders of Common Stock on
liquidation or dissolution, have one vote per share on all matters submitted to
a vote of the stockholders and do not have cumulative voting rights in the
election of directors. All issued and outstanding shares of Common Stock are,
and the Common Stock offered hereby will be upon issuance, validly issued, fully
paid and nonassessable. Holders of the Common Stock do not have preference,
conversion, exchange or preemptive rights. The Common Stock is listed on the New
York Stock Exchange (NYSE Symbol "OHI").
REDEMPTION AND BUSINESS COMBINATION PROVISIONS
If the Board of Directors shall, at any time and in good faith, be of the
opinion that direct or indirect ownership of at least 9.9% or more of the voting
shares of capital stock has or may become concentrated in the hands of one
beneficial owner, the Board of Directors shall have the power (i) by lot or
other means deemed equitable by it to call for the purchase from any stockholder
of the Company a number of voting shares sufficient, in the opinion of the Board
of Directors, to maintain or bring the direct or indirect ownership of voting
shares of capital stock of such beneficial owner to a level of no more than 9.9%
of the outstanding voting shares of the Company's capital stock, and (ii) to
refuse to transfer or issue voting shares of capital stock to any person whose
acquisition of such voting shares would, in the opinion of the Board of
Directors, result in the direct or indirect ownership by that person of more
than 9.9% of the outstanding voting shares of capital stock of the Company.
Further, any transfer of shares, options, warrants, or other securities
convertible into voting shares that would create a beneficial owner of more than
9.9% of the outstanding voting shares shall be deemed void ab initio and the
intended transferee shall be deemed never to have had an interest therein. The
purchase price for any voting shares of capital stock so redeemed shall be equal
to the fair market value of the shares reflected in the closing sales prices for
the shares, if then listed on a national securities exchange, or the average of
the closing sales prices for the shares if then listed on more than one national
securities exchange, or if the shares are not then listed on a national
securities exchange, the latest bid quotation for the shares if then traded
over-the-counter, on the last business day immediately preceding the day on
which notices of such acquisitions are sent by the Company, or, if no such
closing sales prices or quotations are available, then the purchase price shall
be equal to the net asset value of such stock as determined by the Board of
Directors in accordance with the provisions of applicable law. From and after
the date fixed for purchase by the Board of Directors, the holder of any shares
so called for purchase shall cease to be entitled to distributions, voting
rights and other benefits with respect to such shares, except the right to
payment of the purchase price for the shares.
The Articles of Incorporation require that, except in certain
circumstances, Business Combinations (as defined) between the Company and a
beneficial holder of 10% or more of the Company's outstanding voting stock (a
"Related Person") be approved by the affirmative vote of at least 90% of the
outstanding voting shares of the Company.
6
A Business Combination is defined in the Articles of Incorporation as (a)
any merger or consolidation of the Company with or into a Related Person, (b)
any sale, lease, exchange, transfer or other disposition, including without
limitation a mortgage or any other security device, of all or any "Substantial
Part" (as defined) of the assets of the Company (including without limitation
any voting securities of a subsidiary) to a Related Person, (c) any merger or
consolidation of a Related Person with or into the Company, (d) any sale, lease,
exchange, transfer or other disposition of all or any Substantial Part of the
assets of a Related Person to the Company, (e) the issuance of any securities
(other than by way of pro rata distribution to all stockholders) of the Company
to a Related Person, and (f) any agreement, contract or other arrangement
providing for any of the transactions described in the definition of Business
Combination. The term "Substantial Part" shall mean more than 10% of the book
value of the total assets of the Company as of the end of its most recent fiscal
year ending prior to the time the determination is being made.
Pursuant to the Articles of Incorporation, the Company's Board of Directors
is classified into three classes. Each class of directors serves for a term of
three years, with one class being elected each year. As of the date of this
Prospectus, there are seven directors, two in each of two classes of directors,
and three in one class.
The foregoing provisions of the Articles of Incorporation and certain other
matters may not be amended without the affirmative vote of at least 90% of the
outstanding voting shares of the Company.
The foregoing provisions may have the effect of discouraging unilateral
tender offers or other takeover proposals which certain stockholders might deem
in their interests or in which they might receive a substantial premium. The
Board of Directors' authority to issue and establish the terms of currently
authorized Preferred Stock, without stockholder approval, may also have the
effect of discouraging takeover attempts. See "Preferred Stock." The provisions
could also have the effect of insulating current management against the
possibility of removal and could, by possibly reducing temporary fluctuations in
market price caused by accumulation of shares, deprive stockholders of
opportunities to sell at a temporarily higher market price. However, the Board
of Directors believes that inclusion of the Business Combination provisions in
the Articles of Incorporation may help assure fair treatment of stockholders and
preserve the assets of the Company.
The foregoing summary of certain provisions of the Articles of
Incorporation does not purport to be complete or to give effect to provisions of
statutory or common law. The foregoing summary is subject to, and qualified in
its entirety by reference to, the provisions of applicable law and the Articles
of Incorporation, a copy of which is incorporated by reference as an exhibit to
the Registration Statement of which this Prospectus is a part.
TRANSFER AGENT AND REGISTRAR
First Chicago Trust Company of New York is the transfer agent and registrar
of the Common Stock.
PREFERRED STOCK
The following description of the terms of the Preferred Stock sets forth
certain general terms and provisions of the Preferred Stock to which any
Prospectus Supplement may relate. Certain other terms of any series of the
Preferred Stock offered by any Prospectus Supplement will be described in such
Prospectus Supplement. The description of certain provisions of the Preferred
Stock set forth below and in any Prospectus Supplement does not purport to be
complete and is subject to and qualified in its entirety by reference to the
Company's Articles of Incorporation (the "Articles of Incorporation"), and the
Board of Directors' resolution or articles supplementary (the "Articles
Supplementary") relating to each series of the Preferred Stock which will be
filed with the Commission and incorporated by reference as an exhibit to the
Registration Statement of which this Prospectus is a part at or prior to the
time of the issuance of such series of the Preferred Stock.
7
GENERAL
The authorized capital stock of the Company consists of 50,000,000 shares
of Common Stock, $0.10 par value per share, and 10,000,000 shares of preferred
stock, $1.00 par value per share ("preferred stock of the Company," which term,
as used herein, includes the Preferred Stock offered hereby).
Under the Articles of Incorporation, the Board of Directors of the Company
is authorized without further stockholder action to provide for the issuance of
up to 10,000,000 shares of preferred stock of the Company, in one or more
series, with such designations, preferences, powers and relative participating,
optional or other special rights and qualifications, limitations or restrictions
thereon, including, but not limited to, dividend rights, dividend rate or rates,
conversion rights, voting rights, rights and terms of redemption (including
sinking fund provisions), the redemption price or prices, and the liquidation
preferences as shall be stated in the resolution providing for the issue of a
series of such stock, adopted, at any time or from time to time, by the Board of
Directors of the Company.
The Preferred Stock shall have the dividend, liquidation, redemption and
voting rights set forth below unless otherwise provided in a Prospectus
Supplement relating to a particular series of the Preferred Stock. Reference is
made to the Prospectus Supplement relating to the particular series of the
Preferred Stock offered thereby for specific terms, including: (i) the
designation and stated value per share of such Preferred Stock and the number of
shares offered; (ii) the amount of liquidation preference per share; (iii) the
initial public offering price at which such Preferred Stock will be issued; (iv)
the dividend rate (or method of calculation), the dates on which dividends shall
be payable and the dates from which dividends shall commence to cumulate, if
any; (v) any redemption or sinking fund provisions; (vi) any conversion rights;
(vii) any additional voting, dividend, liquidation, redemption, sinking fund and
other rights, preferences, privileges, limitations and restrictions.
The Preferred Stock will, when issued, be fully paid and nonassessable and
will have no preemptive rights. Unless otherwise stated in a Prospectus
Supplement relating to a particular series of the Preferred Stock, each series
of the Preferred Stock will rank on a parity as to dividends and distributions
of assets with each other series of the Preferred Stock. The rights of the
holders of each series of the Preferred Stock will be subordinate to those of
the Company's general creditors.
CERTAIN PROVISIONS OF THE ARTICLES OF INCORPORATION
See "Common Stock -- Redemption and Business Combination Provisions" for a
description of certain provisions of the Articles of Incorporation, including
provisions relating to redemption rights and provisions which may have certain
anti-takeover effects.
DIVIDEND RIGHTS
Holders of the Preferred Stock of each series will be entitled to receive,
when, as and if declared by the Board of Directors of the Company, out of funds
of the Company legally available therefor, cash dividends on such dates and at
such rates as will be set forth in, or as are determined by, the method
described in the Prospectus Supplement relating to such series of the Preferred
Stock. Such rate may be fixed or variable or both. Each such dividend will be
payable to the holders of record as they appear on the stock books of the
Company on such record dates, fixed by the Board of Directors of the Company, as
specified in the Prospectus Supplement relating to such series of Preferred
Stock.
Dividends on any series of Preferred Stock may be cumulative or
noncumulative, as provided in the applicable Prospectus Supplement. If the Board
of Directors of the Company fails to declare a dividend payable on a dividend
payment date on any series of Preferred Stock for which dividends are
noncumulative, then the holders of such series of Preferred Stock will have no
right to receive a dividend in respect of the dividend period ending on such
dividend payment date, and the Company shall have no obligation to pay the
dividend accrued for such period, whether or not dividends on such series are
declared payable on any future dividend payment dates. Dividends on the shares
of each series of Preferred Stock for which dividends are cumulative will accrue
from the date on which the Company initially issues shares of such series.
8
So long as the shares of any series of the Preferred Stock shall be
outstanding, unless (i) full dividends (including if such Preferred Stock is
cumulative, dividends for prior dividend periods) shall have been paid or
declared and set apart for payment on all outstanding shares of the Preferred
Stock of such series and all other classes and series of preferred stock of the
Company (other than Junior Stock as defined below) and (ii) the Company is not
in default or in arrears with respect to the mandatory or optional redemption or
mandatory repurchase or other mandatory retirement of, or with respect to any
sinking or other analogous fund for, any shares of Preferred Stock of such
series or any shares of any other preferred stock of the Company of any class or
series (other than Junior Stock), the Company may not declare any dividends on
any shares of Common Stock of the Company or any other stock of the Company
ranking as to dividends or distributions of assets junior to such series of
Preferred Stock (the Common Stock and any such other stock being herein referred
to as "Junior Stock"), or make any payment on account of, or set apart money
for, the purchase, redemption or other retirement of, or for a sinking or other
analogous fund for, any shares of Junior Stock or make any distribution in
respect thereof, whether in cash or property or in obligations or stock of the
Company, other than Junior Stock which is neither convertible into, nor
exchangeable or exercisable for, any securities of the Company other than Junior
Stock.
LIQUIDATION PREFERENCE
In the event of any liquidation, dissolution or winding up of the Company,
voluntary or involuntary, the holders of each series of the Preferred Stock will
be entitled to receive out of the assets of the Company available for
distribution to stockholders, before any distribution of assets is made to the
holders of Common Stock or any other shares of stock of the Company ranking
junior as to such distribution to such series of Preferred Stock, the amount set
forth in the Prospectus Supplement relating to such series of the Preferred
Stock. If, upon any voluntary or involuntary liquidation, dissolution or winding
up of the Company, the amounts payable with respect to the Preferred Stock of
any series and any other shares of preferred stock of the Company (including any
other series of the Preferred Stock) ranking as to any such distribution on a
parity with such series of the Preferred Stock are not paid in full, the holders
of the Preferred Stock of such series and of such other shares of preferred
stock of the Company will share ratably in any such distribution of assets of
the Company in proportion to the full respective preferential amounts to which
they are entitled. After payment of the holders of the Preferred Stock of each
series of the full preferential amounts of the liquidating distribution to which
they are entitled, the holders of each such series of the Preferred Stock will
be entitled to no further participation in any distribution of assets by the
Company.
If liquidating distributions shall have been made in full to all holders of
shares of Preferred Stock, the remaining assets of the Company shall be
distributed among the holders of Junior Stock, according to their respective
rights and preferences and in each case according to their respective number of
shares. For such purposes, the consolidation or merger of the Company with or
into any other corporation, or the sale, lease or conveyance of all or
substantially all of the property or business of the Company, shall not be
deemed to constitute a liquidation, dissolution or winding up of the Company.
REDEMPTION
A series of the Preferred Stock may be redeemable, in whole or from time to
time in part, at the option of the Company, and may be subject to mandatory
redemption pursuant to a sinking fund or otherwise, in each case upon terms, at
the times and at the redemption prices set forth in the Prospectus Supplement
relating to such series. Shares of the Preferred Stock redeemed by the Company
will be restored to the status of authorized but unissued shares of preferred
stock of the Company.
In the event that fewer than all of the outstanding shares of a series of
the Preferred Stock are to be redeemed, whether by mandatory or optional
redemption, the number of shares to be redeemed will be determined by lot or pro
rata (subject to rounding to avoid fractional shares) as may be determined by
the Company or by any other method as may be determined by the Company in its
sole discretion to be equitable. From and after the redemption date (unless
default shall be made by the Company in providing for the payment of the
redemption price plus accumulated and unpaid dividends, if any), dividends shall
cease to
9
accumulate on the shares of the Preferred Stock called for redemption and all
rights of the holders thereof (except the right to receive the redemption price
plus accumulated and unpaid dividends, if any) shall cease.
So long as any dividends on shares of any series of the Preferred Stock or
any other series of preferred stock of the Company ranking on a parity as to
dividends and distribution of assets with such series of the Preferred Stock are
in arrears, no shares of any such series of the Preferred Stock or such other
series of preferred stock of the Company will be redeemed (whether by mandatory
or optional redemption) unless all such shares are simultaneously redeemed, and
the Company will not purchase or otherwise acquire any such shares; provided,
however, that the foregoing will not prevent the purchase or acquisition of such
shares pursuant to a purchase or exchange offer made on the same terms to
holders of all such shares outstanding.
CONVERSION RIGHTS
The terms and conditions, if any, upon which shares of any series of
Preferred Stock are convertible into Common Stock will be set forth in the
applicable Prospectus Supplement relating thereto. Such terms will include the
number of shares of Common Stock into which the Preferred Stock is convertible,
the conversion price (or manner of calculation thereof), the conversion period,
provisions as to whether conversion will be at the option of the holders of
Preferred Stock or the Company, the events requiring an adjustment of the
conversion price and provisions affecting conversion.
VOTING RIGHTS
Except as indicated below or in a Prospectus Supplement relating to a
particular series of the Preferred Stock, or except as required by applicable
law, the holders of the Preferred Stock will not be entitled to vote for any
purpose.
So long as any shares of the Preferred Stock of a series remain
outstanding, the consent or the affirmative vote of the holders of at least 80%
of the votes entitled to be cast with respect to the then outstanding shares of
such series of the Preferred Stock together with any Other Preferred Stock (as
defined below), voting as one class, either expressed in writing or at a meeting
called for that purpose, will be necessary (i) to permit, effect or validate the
authorization, or any increase in the authorized amount, of any class or series
of shares of the Company ranking prior to the Preferred Stock of such series as
to dividends, voting or upon distribution of assets and (ii) to repeal, amend or
otherwise change any of the provisions applicable to the Preferred Stock of such
series in any manner which adversely affects the powers, preferences, voting
power or other rights or privileges of such series of the Preferred Stock. In
case any series of the Preferred Stock would be so affected by any such action
referred to in clause (ii) above in a different manner than one or more series
of the Other Preferred Stock then outstanding, the holders of shares of the
Preferred Stock of such series, together with any series of the Other Preferred
Stock which will be similarly affected, will be entitled to vote as a class, and
the Company will not take such action without the consent or affirmative vote,
as above provided, of at least 80% of the total number of votes entitled to be
cast with respect to each such series of the Preferred Stock and the Other
Preferred Stock, then outstanding, in lieu of the consent or affirmative vote
hereinabove otherwise required.
With respect to any matter as to which the Preferred Stock of any series is
entitled to vote, holders of the Preferred Stock of such series and any other
series of preferred stock of the Company ranking on a parity with such series of
the Preferred Stock as to dividends and distributions of assets and which by its
terms provides for similar voting rights (the "Other Preferred Stock") will be
entitled to cast the number of votes set forth in the Prospectus Supplement with
respect to that series of Preferred Stock. As a result of the provisions
described in the preceding paragraph requiring the holders of shares of a series
of the Preferred Stock to vote together as a class with the holders of shares of
one or more series of Other Preferred Stock, it is possible that the holders of
such shares of Other Preferred Stock could approve action that would adversely
affect such series of Preferred Stock, including the creation of a class of
capital stock ranking prior to such series of Preferred Stock as to dividends,
voting or distributions of assets.
The foregoing voting provisions will not apply if, at or prior to the time
when the act with respect to which such vote would otherwise be required shall
be effected, all outstanding shares of the Preferred Stock shall
10
have been redeemed or called for redemption and sufficient funds shall have been
deposited in trust to effect such redemption.
TRANSFER AGENT AND REGISTRAR
Unless otherwise indicated in a Prospectus Supplement relating thereto,
First Chicago Trust Company of New York, will be the transfer agent, dividend
and redemption price disbursement agent and registrar for shares of each series
of the Preferred Stock.
DEBT SECURITIES
Debt Securities may be issued from time to time in series under an
Indenture (the "Indenture") dated January 24, 1997, between the Company and NBD
Bank, as Trustee (the "Trustee"). As used under this caption, unless the context
otherwise requires, Offered Debt Securities shall mean the Debt Securities
offered by this Prospectus and the accompanying Prospectus Supplement. The
statements under this caption are brief summaries of certain provisions
contained in the Indenture, do not purport to be complete and are qualified in
their entirety by reference to the Indenture, including the definition therein
of certain terms, a copy of which is filed as an exhibit to the Registration
Statement of which this Prospectus is a part. The following sets forth certain
general terms and provisions of the Debt Securities. Further terms of the
Offered Debt Securities will be set forth in the Prospectus Supplement.
GENERAL
The Indenture provides for the issuance of Debt Securities in series, and
does not limit the principal amount of Debt Securities which may be issued
thereunder.
Reference is made to the Prospectus Supplement for the following terms of
the Offered Debt Securities: (1) the specific title of the Offered Debt
Securities; (2) the aggregate principal amount of the Offered Debt Securities;
(3) the percentage of their principal amount at which the Offered Debt
Securities will be issued payable; (4) the date on which the Offered Debt
Securities will mature; (5) the rate or rates per annum or the method for
determining such rate or rates, if any, at which the Offered Debt Securities
will bear interest; (6) the times at which any such interest will be payable;
(7) any provisions relating to optional or mandatory redemption of the Offered
Debt Securities at the option of the Company or pursuant to sinking fund or
analogous provisions; (8) the denominations in which the Offered Debt Securities
are authorized to be issued if other than $100,000; (9) any provisions relating
to the conversion or exchange of the Offered Debt Securities into Common Stock
or into Debt Securities of another series; (10) the portion of the principal
amount, if less than the principal amount, payable on acceleration; (11) the
place or places at which the Company will make payments of principal (and
premiums, if any) and interest, if any, and the method of payment; (12) whether
the Offered Debt Securities will be issued in whole or in part in global form;
(13) any additional covenants and Events of Default and the remedies with
respect thereto not currently set forth in the Indenture; (14) the identity of
the Trustee for the Debt Securities, and if not the Trustee, the identity of
each paying agent and the Debt Securities Registrar; (15) the currency or
currencies other than United States Dollars in which any series of Debt
Securities will be issued; and (16) any other specific terms of the Offered Debt
Securities.
One or more series of the Debt Securities may be issued as discounted Debt
Securities (bearing no interest or bearing interest at a rate which at the time
of issuance is below market rates) to be sold at a substantial discount below
their stated principal amount. Tax and other special considerations applicable
to any such discounted Debt Securities will be described in the Prospectus
Supplement relating thereto.
STATUS OF DEBT SECURITIES
The Debt Securities will be unsecured obligations of the Company and may be
ranking on a parity with all other unsecured and unsubordinated indebtedness, or
may be subordinated to certain other indebtedness of the Company.
11
CONVERSION RIGHTS
The terms, if any, on which Debt Securities of a series may be exchanged
for or converted into shares of Common Stock or Debt Securities of another
series will be set forth in the Prospectus Supplement relating thereto. To
protect the Company's status as a REIT, a Holder may not convert any Debt
Security, and such Debt Security shall not be convertible by any Holder, if as a
result of such conversion any person would then be deemed to beneficially own,
directly or indirectly, 9.9% or more of the Company's shares of Common Stock.
ABSENCE OF RESTRICTIVE COVENANTS
Except as noted below under "Dividends, Distributions and Acquisitions of
Capital Stock," the Company is not restricted by the Indenture from paying
dividends or from incurring, assuming or becoming liable for any type of debt or
other obligations or from creating liens on its property for any purpose. The
Indenture does not require the maintenance of any financial ratios or specified
levels of net worth or liquidity. Except as may be set forth in the Prospectus
Supplement, there are no provisions of the Indenture which afford holders of the
Debt Securities protection in the event of a highly leveraged transaction
involving the Company.
OPTIONAL REDEMPTION
The Debt Securities will be subject to redemption, in whole or from time to
time in part, at any time for certain reasons intended to protect the Company's
status as a REIT, at the option of the Company in the manner specified in the
Indenture at a redemption price equal to 100% of the principal amount, plus
interest accrued to the date of redemption. The Indenture does not contain any
provision requiring the Company to repurchase the Debt Securities at the option
of the Holders thereof in the event of a leveraged buyout, recapitalization or
similar restructuring of the Company.
DIVIDENDS, DISTRIBUTIONS AND ACQUISITIONS OF CAPITAL STOCK
The Indenture provides that the Company will not (i) declare or pay any
dividend or make any distribution on its capital stock or to holders of its
capital stock (other than dividends or distributions payable in its capital
stock or other than as the Company determines is necessary to maintain its
status as a REIT) or (ii) purchase, redeem or otherwise acquire or retire for
value any of its capital stock, or any warrants, rights or options or other
securities to purchase or acquire any Shares of its capital stock (other than
the Debt Securities) or permit any subsidiary to do so, if at the time of such
action an Event of Default (as defined in the Indenture) has occurred and is
continuing or would exist immediately after giving effect to such action.
EVENTS OF DEFAULT
An Event of Default with respect to Debt Securities of any series is
defined in the Indenture as being (a) failure to pay principal of or any premium
on any Debt Security of that series when due; (b) failure to pay any interest on
any Debt Security of that series when due, continued for 30 days; (c) failure to
deposit any sinking fund payment when due, in respect of any Debt Security of
that series; (d) failure to perform any other covenant of the Company in the
Indenture (other than a covenant included in the Indenture solely for the
benefit of one or more series of Debt Securities other than that series),
continued for 60 days after written notice as provided in the Indenture; (e)
certain events of bankruptcy, insolvency, conservatorship, receivership or
reorganization; and (f) any other Event of Default provided with respect to the
Debt Securities of that series.
12
If an Event of Default with respect to the outstanding Debt Securities of
any series occurs and is continuing, either the Trustee or the Holders of at
least 25% in aggregate principal amount of the outstanding Debt Securities of
that series may declare the principal amount (or, if the Debt Securities of that
series are original issue discount Debt Securities, such portion of the
principal amount as may be specified in the terms of that series) of all the
outstanding Debt Securities of that series to be due and payable immediately. At
any time after the declaration of acceleration with respect to the Debt
Securities of any series has been made, but before a judgment or decree based on
acceleration has been obtained, the Holders of a majority in aggregate principal
amount of the outstanding Debt Securities of that series may, under certain
circumstances, rescind and annul such acceleration.
The Indenture provides that, subject to the duty of the Trustee during
default to act with the required standard of care, the Trustee will be under no
obligation to exercise any of its rights or powers under the Indenture at the
request or direction of any of the Holders, unless such Holders shall have
offered to the Trustee reasonable indemnity. Subject to such provisions for the
indemnification of the Trustee and subject to certain limitations, the Holders
of a majority in aggregate principal amount of the outstanding Debt Securities
of any series will have the right to direct the time, method and place of
conducting any proceeding for any remedy available to the Trustee, or exercising
any trust or power conferred on the Trustee, with respect to the Debt Securities
of that series.
The Company is required to furnish to the Trustee annually a statement as
to the performance by the Company of certain of its obligations under the
Indenture and as to any default in such performance.
MODIFICATIONS AND WAIVER
Modifications and amendments of the Indenture may be made by the Company
and the Trustee without the consent of any Holders to, among other things, (a)
evidence the succession of another corporation to the Company, (b) add to the
covenants of the Company or surrender any right or power conferred upon the
Company, (c) to establish the form or terms of Debt Securities, including any
subordination provisions, (d) cure any ambiguity, correct or supplement any
provision which may be defective or inconsistent or make any other provisions
with respect to matters or questions arising under the Indenture, provided that
such action does not adversely affect the interests of the Holders of Debt
Securities of any series in any material respect, (e) to add to, delete, or
revise conditions, limitations and restrictions on the authorized amounts, terms
or purpose of Debt Securities, as set forth in the Indenture, or (f) evidence
and provide for a successor Trustee.
Modifications and amendments of the Indenture may be made by the Company
and the Trustee with the consent of the Holders of a majority in aggregate
principal amount of the outstanding Debt Securities of each series affected by
such modification or amendment; provided, however, that no such modification or
amendment may, without the consent of the Holder of each outstanding Debt
Security affected thereby, (a) change the stated maturity date of the principal
of, or any installment of principal of or interest , if any, on any Debt
Security , (b) reduce the principal amount of, or premium or interest if any, on
any Debt Security, (c) reduce the amount of principal of an original issue
discount Debt Security payable upon acceleration of the maturity thereof, (d)
change the currency of payment of the principal of, or premium or interest, if
any, on any Debt Security, (e) impair the right to institute suit for the
enforcement of any payment on or with respect to any Debt Security, (f) modify
the conversion provisions, if any, of any Debt Security in a manner adverse to
the Holder of that Debt Security, or (g) reduce the percentage in principal
amount of the outstanding Debt Security of any series, the consent of whose
Holders is required for modification or amendment of that Indenture or for
waiver of compliance with certain provisions of that Indenture or for waiver of
certain defaults.
The Holders of a majority in aggregate principal amount of the outstanding
Debt Security of each series may, on behalf of all Holders of the Debt
Securities of that series, waive, insofar as that series is concerned,
compliance by the Company with certain restrictive provisions of the Indenture.
The Holders of a majority in aggregate principal amount of the outstanding Debt
Securities of each series may, on behalf of all Holders of the Debt Securities
of that series, waive any past default under the Indenture with respect to the
Debt Securities of that series, except a default in the payment of principal or
premium or interest, if any, or a default
13
in respect of a covenant or provision which under the terms of the Indenture
cannot be modified or amended without the consent of the Holder of each
outstanding Debt Security of the series affected.
CONSOLIDATION, MERGER AND SALE OF ASSETS
The Indenture provides that the Company, without the consent of the Holders
of any of the Debt Securities, may consolidate or merge with or into or transfer
its assets substantially as an entirety to, any entity organized under the laws
of the United States or any state, provided that the successor entity assumes
the Company's obligations under the Indenture, that after giving effect to the
transaction no Event of Default, and no event which, after notice or lapse of
time, would become an Event of Default, shall have occurred and be continuing,
and that certain other conditions are met.
GLOBAL SECURITIES
The Debt Securities of a series may be issued in whole or in part in global
form (the "Global Securities"). Except as set forth in a Prospectus Supplement,
the terms and provisions with respect to any Global Securities will be as set
forth in this Section captioned "Global Securities." The Global Securities will
be deposited with a depositary (the "Depositary"), or with a nominee for a
Depositary, identified in the Prospectus Supplement. In such case, one or more
Global Securities will be issued in a denomination or aggregate denominations
equal to the portion of the aggregate principal amount of outstanding Debt
Securities of the series to be represented by such Global Security or
Securities. Unless and until it is exchanged in whole or in part for Debt
Securities in definitive form, a Global Security may not be transferred except
as a whole by the Depositary for such Global Security to a nominee of such
Depositary or by a nominee of such Depositary to such Depositary or another
nominee of such Depositary or by such Depositary or any such nominee to a
successor of such Depositary or a nominee of such successor.
The specific material terms of the depositary arrangement with respect to
any portion of a series of Debt Securities to be represented by a Global
Security will be described in the Prospectus Supplement. The Company anticipates
that the following provisions will apply to all depositary arrangements.
Upon the issuance of a Global Security, the Depositary for such Global
Security will credit, on its book-entry registration and transfer system, the
respective principal amounts of the Debt Securities represented by such Global
Security to the accounts of persons that have accounts with such Depositary
("participants"). The accounts to be credited shall be designated by any
underwriters or agents participating in the distribution of such Debt
Securities. Ownership of beneficial interests in a Global Security will be
limited to participants or persons that may hold interests through participants.
Ownership of beneficial interests in a Global Security will be limited to
participants or persons that may hold interests through participants. Ownership
of beneficial interests in such Global Security will be shown on, and the
transfer of that ownership will be effected only through, records maintained by
the Depositary for such Global Security (with respect to interests of
participants) or by participants or persons that hold through participants (with
respect to interests of persons other than participant). So long as the
Depositary for a Global Security, or its nominee, is the registered owner of
such Global Security, such Depositary or such nominee, as the case may be, will
be considered the sole owner or Holder of the Debt Securities represented by
such Global Security for all purposes under the Indenture; provided, however,
that the purposes of obtaining any consents or directions required to be given
by the Holders of the Debt Securities, the Company, the Trustee and its agents
will treat a person as the holder of such principal amount of Debt Securities as
specified in a written statement of the Depositary. Except as set forth herein
or otherwise provided in the Prospectus Supplement, owners of beneficial
interests in a Global Security will not be entitled to have the Debt Securities
represented by such Global Security registered in their names, will not receive
physical delivery of such Debt Securities in definitive form and will not be
considered the owners or Holders thereof under the Indenture.
Principal, premium, if any, and interest payments on Debt Securities
represented by a Global Security registered in the name of a Depositary or its
nominee will be made to such Depositary or its nominee, as the case may be, as
the registered owner of such Global Security. None of the Company, the Trustee
or any Paying Agent for such Debt Securities will have any responsibility or
liability for any aspect of the records
14
relating to or payments made on account of beneficial ownership interests in
such Global Security or for maintaining, supervising or reviewing any records
relating to such beneficial ownership interests.
The Company expects that the Depositary for any Debt Securities represented
by a Global Security, upon receipt of any payment of principal, premium, if any,
or interest will immediately credit participants' accounts with payments in
amounts proportionate to their respective beneficial interests in the principal
amount of such Global Security as shown on the records of such Depositary. The
Company also expects that payments by participants will be governed by standing
instructions and customary practices, as is now the case with the securities
held for the accounts of customers registered in "street names" and will be the
responsibility of such participants.
If the Depositary for any Debt Securities represented by a Global Security
is at any time unwilling or unable to continue as Depositary and a successor
Depositary is not appointed by the Company within 90 days, the Company will
issue such Debt Securities in definitive form in exchange for such Global
Security. In addition, the Company may at any time and in its sole discretion
determine not to have any of the Debt Securities of a series represented by one
or more Global Securities and, in such event, will issue Debt Securities of such
series in definitive form in exchange for all of the Global Security or
Securities representing such Debt Securities.
The laws of some states require that certain purchasers of securities take
physical delivery of such securities in definitive form. Such laws may impair
the ability to transfer beneficial interests in Debt Securities represented by
Global Securities.
SECURITIES WARRANTS
The Company may issue Securities Warrants for the purchase of Common Stock,
Preferred Stock or Debt Securities. Securities Warrants may be issued
independently or together with Common Stock, Preferred Stock or Debt Securities
offered by any Prospectus Supplement and may be attached to or separate from
such Common Stock, Preferred Stock, or Debt Securities. Each series of
Securities Warrants will be issued under a separate warrant agreement (a
"Securities Warrant Agreement") to be entered into between the Company and a
bank or trust company, as Securities Warrant agent, all as set forth in the
Prospectus Supplement relating to the particular issue of offered Securities
Warrants. The Securities Warrant agent will act solely as an agent of the
Company in connection with the Securities Warrants of such series and will not
assume any obligation or relationship of agency or trust for or with any holders
or beneficial owners of Securities Warrants. The following summaries of certain
provisions of the Securities Warrant Agreement and Securities Warrants do not
purport to be complete and are subject to, and are qualified in their entirety
by reference to, all the provisions of the Securities Warrant Agreement and the
Securities Warrants relating to each series of Securities Warrants which will be
filed with the Commission and incorporated by reference as an exhibit to the
Registration Statement of which this Prospectus is a part at or prior to the
time of the issuance of such series of Securities Warrants.
In the case of Securities Warrants for the purchase of Common Stock or
Preferred Stock, the applicable Prospectus Supplement will describe the terms of
such Securities Warrants, including the following where applicable: (i) the
offering price; (ii) the aggregate number of shares purchasable upon exercise of
such Securities Warrants, the exercise price, and in the case of Securities
Warrants for Preferred Stock the designation, aggregate number and terms of the
series of Preferred Stock purchasable upon exercise of such Securities Warrants,
(iii) the designation and terms of any series of Preferred Stock with which such
Securities Warrants are being offered and the number of such Securities Warrants
being offered with such Preferred Stock, (iv) the date, if any, on and after
which such Securities Warrants and the related series of Preferred Stock or
Common Stock will be transferable separately; (v) the date on which the right to
exercise such Securities Warrants shall commence and the Expiration Date; (vi)
any special United States Federal income tax consequences; and (vii) any other
terms of such Securities Warrants.
15
If Securities Warrants for the purchase of Debt Securities are offered, the
applicable Prospectus Supplement will describe the terms of such Securities
Warrants, including the following where applicable: (i) the offering price; (ii)
the denominations and terms of the series of Debt Securities purchasable upon
exercise of such Securities Warrants; (iii) the designation and terms of any
series of Debt Securities, with which such Securities Warrants are being offered
with each such Debt Securities; (iv) the date, if any, on and after which such
Securities Warrants and the related series of Debt Securities will be
transferable separately; (v) the principal amount of the series of Debt
Securities purchasable upon exercise of each such Securities Warrant and the
price at which such principal amount of Debt Securities of such series may be
purchased upon such exercise; (vi) the date on which the right shall expire (the
"Expiration Date"); (vii) whether the Securities Warrants will be issued in
registered or bearer form; (viii) any special United States Federal income tax
consequences; (ix) the terms, if any, on which the Company may accelerate the
date by which the Securities Warrants must be exercised; and (x) any other terms
of such Securities Warrants.
Securities Warrant certificates may be exchanged for new Securities Warrant
certificates of different denominations, may (if in registered form) be
presented for registration of transfer, and may be exercised at the corporate
trust office of the Securities Warrant agent or any other office indicated in
the applicable Prospectus Supplement. Prior to the exercise of any Securities
Warrant to purchase Debt Securities, holders of such Securities Warrants will
not have any of the rights of holders of the Debt Securities purchasable upon
such exercise, including the right to receive payments of principal or premium,
if any, or interest, if any, on such Debt Securities or to enforce covenants in
the applicable indenture. Prior to the exercise of any Securities Warrants to
purchase Common Stock or Preferred Stock, holders of such Securities Warrants
will not have any rights of holders of such Common Stock or Preferred Stock,
including the right to receive payments of dividends, if any, on such Common
Stock or Preferred Stock, or to exercise any applicable right to vote.
EXERCISE OF SECURITIES WARRANTS
Each Securities Warrant will entitle the holder thereof to purchase a
number of shares of Common Stock, Preferred Stock or such principal amount of
Debt Securities, as the case may be, at such exercise price as shall in each
case be set forth in, or calculable from, the Prospectus Supplement relating to
the offered Securities Warrants. After the close of business on the Expiration
Date (or such later date to which such Expiration Date may be extended by the
Company), unexercised Securities Warrants will become void.
Securities Warrants may be exercised by delivering to the Securities
Warrant agent payment as provided in the applicable Prospectus Supplement of the
amount required to purchase the Common Stock, Preferred Stock or Debt
Securities, as the case may be, purchasable upon such exercise together with
certain information set forth on the reverse side of the Securities Warrant
certificate. Securities Warrants will be deemed to have been exercised upon
receipt of payment of the exercise price, subject to the receipt within five (5)
business days, of the Securities Warrant certificate evidencing such Securities
Warrants. Upon receipt of such payment and the Securities Warrant certificate
properly completed and duly executed at the corporate trust office of the
Securities Warrant agent or any other office indicated in the applicable
Prospectus Supplement, the Company will, as soon as practicable, issue and
deliver the Common Stock, Preferred Stock or Debt Securities, as the case may
be, purchasable upon such exercise. If fewer than all of the Securities Warrants
represented by such Securities Warrant certificate are exercised, a new
Securities Warrant certificate will be issued for the remaining amount of
Securities Warrants.
AMENDMENTS AND SUPPLEMENTS TO SECURITIES WARRANT AGREEMENT
The Securities Warrant Agreements may be amended or supplemented without
the consent of the holders of the Securities Warrants issued thereunder to
effect changes that are not inconsistent with the provisions of the Securities
Warrants and that do not adversely affect the interests of the holders of the
Securities Warrants.
16
COMMON STOCK WARRANT ADJUSTMENTS
Unless otherwise indicated in the applicable Prospectus Supplement, the
exercise price of, and the number of shares of Common Stock covered by a Common
Stock Warrant are subject to adjustment in certain events, including (i) payment
of a dividend on the Common Stock payable in capital stock and stock splits,
combinations or reclassifications of the Common Stock, (ii) issuance to all
holders of Common Stock of rights or warrants to subscribe for or purchase
shares of Common Stock at less than their current market price (as defined in
the Securities Warrant Agreement for such series of Common Stock Warrants), and
(iii) certain distributions of evidences of indebtedness or assets (including
cash dividends or distributions paid out of consolidated earnings or retained
earnings or dividends payable in Common Stock) or of subscription rights and
warrants (excluding those referred to above).
No adjustment in the exercise price of, and the number of shares of Common
Stock covered by a Common Stock Warrant will be made for regular quarterly or
other periods or recurring cash dividends or distributions or for cash dividends
or distributions to the extent paid from consolidated earnings or retained
earnings. No adjustment will be required unless such adjustment would require a
change of at least 1% in the exercise price then in effect. Except as stated
above, the exercise price of, and the number of shares of Common Stock covered
by, a Common Stock Warrant will not be adjusted for the issuance of Common Stock
or any securities convertible into or exchangeable for Common Stock, or carrying
the right or option to purchase or otherwise acquire the foregoing in exchange
for cash, other property or services.
In the event of any (i) consolidation or merger of the Company with or into
any entity (other than a consolidation or a merger that does not result in any
reclassification, conversion, exchange or cancellation of outstanding shares of
Common Stock), (ii) sale, transfer, lease or conveyance of all or substantially
all of the assets of the Company or (iii) reclassification, capital
reorganization or change of the Common Stock (other than solely a change in par
value or from par value to no par value), then any holder of a Common Stock
Warrant will be entitled, on or after the occurrence of any such event, to
receive on exercise of such Common Stock Warrant the kind and amount of shares
of stock or other securities, cash or other property (or any combination
thereof) that the holder would have received had such holder exercised such
holder's Common Stock Warrant immediately prior to the occurrence of such event.
If the consideration to be received upon exercise of the Common Stock Warrant
following any such event consists of common stock of the surviving entity, then
from and after the occurrence of such event, the exercise price of such Common
Stock Warrant will be subject to the same anti-dilution and other adjustments
described in the second preceding paragraph, applied as if such common stock
were Common Stock.
PLAN OF DISTRIBUTION
The Company may sell the Securities to one or more underwriters for public
offering and sale by them or may sell the Securities to investors directly or
through agents. Any such underwriter or agent involved in the offer and sale of
Securities will be named in the applicable Prospectus Supplement. The Company
has reserved the right to sell Securities directly to investors on its own
behalf in those jurisdictions where and in such manner as it is authorized to do
so.
Underwriters may offer and sell Securities at a fixed price or prices,
which may be changed, at market prices prevailing at the time of sale, at prices
related to such prevailing market prices or at negotiated prices. The Company
also may, from time to time, authorize underwriters or dealers, acting as the
Company's agents, to offer and sell Securities upon the terms and conditions as
are set forth in the applicable Prospectus Supplement. In connection with the
sale of Securities, underwriters may be deemed to have received compensation
from the Company in the form of underwriting discounts or commissions and may
also receive commissions from purchasers of the Securities for whom they may act
as agent. Underwriters may sell Securities to or through dealers, and such
dealers may receive compensation in the form of discounts, concessions or
commissions from the underwriters and/or commissions from the purchasers for
whom they may act as agent.
17
Any underwriting compensation paid by the Company to underwriters or agents
in connection with the offering of Securities, and any discounts, concessions or
commissions allowed by underwriters to participating dealers, will be set forth
in the applicable Prospectus Supplement. Dealers and agents participating in the
distribution of Securities may be deemed to be underwriters, and any discounts
and commissions received by them and any profit realized by them on resale of
the Securities may be deemed to be underwriting discounts and commissions.
Underwriters, dealers and agents may be entitled, under agreements entered into
with the Company, to indemnification against and contribution toward certain
civil liabilities, including liabilities under the Securities Act.
The net proceeds to the Company from the sale of the Securities will be the
purchase price of the Securities less any such discounts or commissions and the
other attributable expenses of issuance and distribution.
Certain of the underwriters and their affiliates may be customers of,
engage in transactions with and perform services for the Company and its
subsidiaries in the ordinary course of business.
LEGAL MATTERS
Certain legal matters with respect to the Securities offered hereby will be
passed upon for the Company by Argue Pearson Harbison & Myers, LLP, Los Angeles,
California.
EXPERTS
The consolidated financial statements of Omega Healthcare Investors, Inc.
(the Company), incorporated by reference from the Company's Annual Report on
Form 10-K, for the year ended December 31, 1995, have been audited by Ernst &
Young LLP, independent auditors, as set forth in their report incorporated by
reference therein and incorporated herein by reference. Such consolidated
financial statements are incorporated herein by reference in reliance upon such
report given upon the authority of such firm as experts in accounting and
auditing.
18
- ------------------------------------------------------
- ------------------------------------------------------
NO DEALER, SALESMAN OR OTHER PERSON HAS BEEN AUTHORIZED TO GIVE ANY
INFORMATION OR TO MAKE ANY REPRESENTATIONS OTHER THAN THOSE CONTAINED OR
INCORPORATED BY REFERENCE IN THIS PROSPECTUS IN CONNECTION WITH THE OFFER MADE
BY THIS PROSPECTUS AND, IF GIVEN OR MADE, SUCH INFORMATION OR REPRESENTATIONS
MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY THE COMPANY OR ANY
UNDERWRITER, DEALER OR AGENT. NEITHER THE DELIVERY OF THIS PROSPECTUS NOR ANY
SALE MADE HEREUNDER SHALL, UNDER ANY CIRCUMSTANCES, CREATE AN IMPLICATION THAT
THERE HAS BEEN NO CHANGE IN THE AFFAIRS OF THE COMPANY SINCE THE DATE HEREOF.
THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFER OR SOLICITATION BY ANYONE IN ANY
STATE IN WHICH SUCH OFFER OR SOLICITATION IS NOT AUTHORIZED OR IN WHICH THE
PERSON MAKING SUCH OFFER OR SOLICITATION IS NOT QUALIFIED TO DO SO OR TO ANYONE
TO WHOM IT IS UNLAWFUL TO MAKE SUCH OFFER OR SOLICITATION.
------------------
TABLE OF CONTENTS
- ------------------------------------------------------
- ------------------------------------------------------
- ------------------------------------------------------
- ------------------------------------------------------
$150,000,000
OMEGA HEALTHCARE
INVESTORS, INC.
SECURITIES
--------------------
PROSPECTUS
--------------------
JANUARY 31, 1997
- ------------------------------------------------------
- ------------------------------------------------------
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
Set forth below is an estimate (except for the Commission registration fee)
of the fees and expenses payable by the Company in connection with the offering
of the Securities:
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
The Articles of Incorporation and Bylaws of the Registrant provide for
indemnification of directors and officers to the full extent permitted by
Maryland law.
Section 2-418 of the General Corporation Law of the State of Maryland
generally permits indemnification of any director or officer with respect to any
proceedings unless it is established that (a) the act or omission of the
director or officer was material to the matter giving rise to the proceeding and
was either committed in bad faith or the result of active or deliberate
dishonesty; (b) the director or officer actually received an improper personal
benefit in money, property or services, or; (c) in the case of criminal
proceedings, the director or officer had reasonable cause to believe that the
act or omission was unlawful. The indemnity may include judgments, penalties,
fines, settlements, and reasonable expenses actually incurred by the director or
officer in connection with the proceedings; provided, however, that if the
proceeding is one by, or in the right of, the corporation, indemnity is
permitted only for reasonable expenses and not with respect to any proceeding in
which the director shall have been adjudged to be liable to the corporation. The
termination of any proceeding by judgment, order or settlement does not create a
presumption that the director did not meet the requisite standard of conduct
required for permitted indemnification. The termination of any proceeding by
conviction, or plea of nolo contendere or its equivalent, or an entry of an
order of probation prior to judgment, creates a rebuttable presumption that the
director or officer did not meet that standard of conduct.
The Company has entered into indemnity agreements with the officers and
directors of the Company that provide that the Company will, subject to certain
conditions, pay on behalf of the indemnified party any amount which the
indemnified party is or becomes legally obligated to pay because of any act or
omission or neglect or breach of duty, including any actual or alleged error or
misstatement or misleading statement, which the indemnified party commits or
suffers while acting in the capacity as an officer or director of the Company.
Insofar as indemnification for liabilities arising under the Securities Act
is permitted to directors and officers of the Registrant pursuant to the
above-described provisions, the Registrant understands that the Commission is of
the opinion that such indemnification contravenes federal public policy as
expressed in said act and therefore is unenforceable.
II-1
ITEM 16. EXHIBITS
- ---------------
** To be filed by amendment or incorporated by reference in connection with the
offering of the Securities.
ITEM 17. UNDERTAKINGS.
(a) The undersigned registrant hereby undertakes that:
(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this Registration Statement:
(i) To include any prospectus required by Section 10(a)(3) of the
Securities Act of 1933, as amended (the "Securities Act");
(ii) To reflect in the prospectus any facts or events arising after
the effective date of the Registration Statement (or the most recent
post-effective amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the information set forth
in the Registration Statement. Notwithstanding the foregoing, any
increase or decrease in volume of securities offered (if the total
dollar value of securities offered would not exceed that which was
registered and any deviation from the low or high and of the estimated
maximum offering range may be reflected in the form of prospectus filed
with the Commission pursuant to Rule 424(b) if, in the aggregate, the
changes in volume and price represent no more than 20 percent change in
the maximum aggregate offering price set forth in the "Calculation of
Registration Fee" table in the effective registration statement;
(iii) To include any material information with respect to the plan
of distribution not previously disclosed in the Registration Statement
or any material change to such information in the Registration
Statement;
provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii) do not apply if
the Registration Statement is on Form S-3, Form S-8 or Form F-3, and the
information required to be included in a post-effective amendment by those
paragraphs is contained in periodic reports filed with or furnished to the
Commission by the Registrant pursuant to Section 13 or Section 15(d) of the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), that are
incorporated by reference in the Registration Statement.
II-2
(2) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the
termination of the offering.
(b) The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Securities Exchange Act of 1934 (and, where applicable, each filing of an
employee benefit plan's annual report pursuant to Section 15(d) of the
Securities Exchange Act of 1934) that is incorporated by reference in this
registration statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
(c) Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to directors, officers and controlling persons of
the registrant pursuant to the foregoing provisions, or otherwise, the
registrant has been advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as expressed in the Act
and is, therefore, unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by the registrant of expenses
incurred or paid by a director, officer or controlling person of the registrant
in the successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered the registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Act and will be governed by the final adjudication of
such issue.
(d) For purposes of determining any liability under the Securities Act of
1933, the information omitted from the form of prospectus filed as part of this
registration statement in reliance upon Rule 430A and contained in a form of
prospectus filed by the registrant pursuant to Rule 424(b)(1) or (4) or 497(h)
under the Securities Act shall be deemed to be part of this registration
statement as of the time it was declared effective.
(e) For the purpose of determining any liability under the Securities Act
of 1933, each post-effective amendment that contains a form of prospectus shall
be deemed to be a new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall be deemed to be
the initial bona fide offering thereof.
(f) The undersigned Registrant hereby undertakes to file an application for
the purpose of determining the eligibility of the trustee to act under
subsection (a) of section 310 of the Trust Indenture Act (the "TIA") in
accordance with the rules and regulations prescribed by the Commission under
section 305(b)(2) of the TIA.
II-3
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-3 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Ann Arbor, State of Michigan, on the 31st day of
January, 1997.
OMEGA HEALTHCARE INVESTORS, INC.
By: /s/ ESSEL W. BAILEY, JR.
-------------------------------
Essel W. Bailey, Jr.
Chairman, President and
Chief Executive Officer
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears
below constitutes and appoints Essel W. Bailey, Jr. and David A. Stover, and
each or any of them, his true and lawful attorney-in-fact and agent, with full
power of substitution and resubstitution, for him and in his name, place and
stead, in any and all capacities, to sign any and all amendments (including
post-effective amendments) to this Registration Statement, and to file the same,
with all exhibits thereto and other documents in connection therewith, with the
Securities and Exchange Commission, granting unto said attorneys-in-fact and
agents, and each of them, full power and authority to do and perform each and
every act and thing requisite and necessary to be done in and about the
premises, as fully to all intents and purposes as he might or could do in
person, hereby ratifying and confirming all that said attorneys-in-fact and
agents or any of them, or their or his substitutes or substitute, may lawfully
do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Exchange Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.
II-4
II-5
EXHIBIT INDEX
- ---------------
** To be filed by amendment or incorporated by reference in connection with the
offering of the Securities.