1 ================================================================================ UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-K (MARK ONE) [X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934 [NO FEE REQUIRED] FOR THE FISCAL YEAR ENDED DECEMBER 31, 1996. [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934 [NO FEE REQUIRED] FOR THE TRANSITION PERIOD FROM TO COMMISSION FILE NUMBER 1-11316 OMEGA HEALTHCARE INVESTORS, INC. (EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER) MARYLAND 38-3041398 (STATE OR OTHER JURISDICTION (I.R.S. EMPLOYER IDENTIFICATION NO.) OF INCORPORATION OR ORGANIZATION) 905 W. EISENHOWER CIRCLE, SUITE 110 48103 ANN ARBOR, MICHIGAN (ZIP CODE) (ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE: 313-747-9790 SECURITIES REGISTERED PURSUANT TO SECTION 12(B) OF THE ACT: NAME OF EXCHANGE ON TITLE OF EACH CLASS WHICH REGISTERED ------------------- ------------------- COMMON STOCK, $.10 PAR VALUE NEW YORK STOCK EXCHANGE 8.5% CONVERTIBLE DEBENTURES, DUE 2001 NEW YORK STOCK EXCHANGE SECURITIES REGISTERED PURSUANT TO SECTION 12(G) OF THE ACT: NONE INDICATE BY CHECK MARK WHETHER THE REGISTRANT (1) HAS FILED ALL REPORTS REQUIRED TO BE FILED BY SECTION 13 OR 15(D) OF THE SECURITIES AND EXCHANGE ACT OF 1934 DURING THE PRECEDING 12 MONTHS (OR FOR SUCH SHORTER PERIOD THAT THE REGISTRANT WAS REQUIRED TO FILE SUCH REPORTS) AND (2) HAS BEEN SUBJECT TO SUCH FILING REQUIREMENTS FOR THE PAST 90 DAYS. YES [X] NO [ ] INDICATE BY CHECK MARK IF DISCLOSURE OF DELINQUENT FILERS PURSUANT TO ITEM 405 OF REGULATION S-K IS NOT CONTAINED HEREIN, AND WILL NOT BE CONTAINED, TO THE BEST OF REGISTRANT'S KNOWLEDGE, IN DEFINITIVE PROXY OR INFORMATION STATEMENTS INCORPORATED BY REFERENCE IN PART III OF THIS FORM 10-K OR ANY AMENDMENT TO THIS FORM 10-K. [X] THE AGGREGATE MARKET VALUE OF THE VOTING STOCK OF THE REGISTRANT HELD BY NON-AFFILIATES WAS $581,000,000 BASED ON THE $31.375 CLOSING PRICE PER SHARE FOR SUCH STOCK ON THE NEW YORK STOCK EXCHANGE ON FEBRUARY 28, 1997. AS OF FEBRUARY 28, 1997, THERE WERE 18,784,560 SHARES OUTSTANDING. DOCUMENTS INCORPORATED BY REFERENCE PORTIONS OF THE REGISTRANT'S ANNUAL REPORT TO SHAREHOLDERS FOR THE YEAR ENDED DECEMBER 31, 1996, ARE INCORPORATED BY REFERENCE IN PART II OF THIS FORM 10-K. THE REGISTRANT'S DEFINITIVE PROXY STATEMENT, WHICH WAS FILED WITH THE COMMISSION ON MARCH 6, 1997, IS INCORPORATED BY REFERENCE IN PART III OF THIS FORM 10-K. ================================================================================
2 PART I ITEM 1 -- BUSINESS OF 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 in the United States. The Company anticipates providing lease or mortgage financing for healthcare facilities to qualified operators and acquiring additional healthcare facility types, including assisted living and acute care facilities. Financing for such future investments may be provided by borrowings under the Company's bank line of credit, private placements or public offerings of debt or equity, the assumption of secured indebtedness, or a combination of these methods. The Company also may finance acquisitions through the exchange of properties or the issuance of shares of its capital stock, if such transactions otherwise satisfy the Company's investment criteria. Effective September 30, 1994, the Company acquired all the outstanding common stock of Health Equity Properties Incorporated ("HEP"), a healthcare real estate investment trust. The total purchase consideration for HEP approximated $180 million, comprising common stock of $143 million represented by 5,826,000 shares, long-term debt assumed of $26 million, and other obligations, professional fees and costs incurred in the transaction. During 1995, the Company became a primary sponsor of Principal Healthcare Finance Limited ("Principal"), an Isle of Jersey (United Kingdom) company established to provide capital and medium-term financing on a stable, continuing basis to the private-sector healthcare industry in the United Kingdom. The nursing home industry in the United Kingdom, like that in the United States, is consolidating and capital demand exists. At December 31, Principal owned 42 properties for which it has invested L69.7 million (approximately $116 million). The Company also provides services for the administration, marketing, identification and evaluation of potential investments and the monitoring of the performance of the healthcare operators financed by Principal. 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 facilities and 3 medical office buildings, and provides mortgages, including participating and convertible participating mortgages on 82 long-term healthcare facilities. The facilities are located in 24 states and operated by 34 unaffiliated operators. The Company's gross investments at December 31, 1996 totaled $643,261,000. During 1996, new investments approximated $96 million as a result of entering into sale/leaseback transactions and making mortgage loans and other investments. At March 1, 1997, the Company employed 21 full-time employees. 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 OBJECTIVES 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. INVESTMENT STRATEGIES AND POLICIES The Company maintains a diversified portfolio of income-producing healthcare facilities or mortgages thereon, with a primary focus on long-term care facilities located in the United States. In evaluating potential investments, the Company considers such factors as: (i) the quality and experience of management and the credit worthiness 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 1
3 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 healthcare 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 and intends to focus on established, creditworthy, "middle-market" healthcare 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 healthcare facilities or other properties. The Company actively seeks to diversify its investments in terms of geographic locations, operators and facility types. A fundamental strategy of the Company is to obtain contractual rent escalations under long-term, non-cancelable, "triple-net" leases and revenue participation through participating mortgage loans, and to obtain substantial liquidity deposits. Additional security is typically provided by covenants regarding minimum working capital and net worth, liens on accounts receivable and other operating assets, and various provisions for cross-default, cross-collateralization and corporate/personal guarantees, when appropriate. The Company prefers to invest in equity ownership of properties. Due to regulatory, tax or other considerations, the Company sometimes pursues alternative investment structures, including convertible participating and participating mortgages, that achieve returns comparable to equity investments. The following summarizes the four primary structures currently used by the Company: Purchase/Leaseback. The Company's owned properties are generally leased under provisions of leases for terms ranging from 5 to 17 years, plus renewal options. The leases originated by the Company generally provide for minimum annual rentals which are subject to annual formula increases (i.e., based upon such factors as increases in the Consumer Price Index ("CPI") or increases in the revenues of the underlying properties), with certain fixed minimum and maximum levels. Generally, the operator holds an option to repurchase at set dates at formula prices. The average annualized yield from leases was 11.85% at January 1, 1997. Convertible Participating Mortgage. Convertible Participating Mortgages are secured by first mortgage liens on the underlying real estate and personal property of the mortgagor. Interest rates are usually subject to annual increases based upon increases in the CPI or increases in revenues of the underlying long-term care facilities, with certain maximum limits. Convertible Participating Mortgages afford the Company an option to convert its mortgage into direct ownership of the property, generally at a point six to nine years from inception; they are then subject to a leaseback to the operator for the balance of the original agreed term and for the original agreed participations in revenues or CPI adjustments. This allows the Company to capture a portion of the potential appreciation in value of the real estate. The operator has the right to buy out the Company's option at formula prices. The average annualized yield on these mortgages was approximately 12.67% at January 1, 1997. Participating Mortgage. Participating Mortgages of the Company are secured by first mortgage liens on the underlying real estate and personal property of the mortgagor. Interest rates are usually subject to annual increases based upon increases in the CPI or increases in revenues of the underlying long-term care facilities, with certain maximum limits. The average annualized yield on these investments was approximately 13.33% at January 1, 1997. Fixed-Rate Mortgage. These Mortgages of the Company, with a fixed interest rate for the mortgage term, are also secured by first mortgage liens on the underlying real estate and personal property of the mortgagor. The average annualized yield on these investments was 11.27% at January 1, 1997. The table set forth in Item 2 -- Properties, herein, contains information regarding the Company's real estate properties, their locations, and the types of investment structures as of December 31, 1996. 2
4 BORROWING POLICIES The Company may incur additional long-term indebtedness, and anticipates attaining and then maintaining a long-term debt-to-capitalization ratio of approximately 40%. The Company intends to review periodically its policy with respect to its debt-to-equity 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 healthcare 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 generally may invest in properties subject to existing loans, secured by mortgages, deeds of trust or similar liens on properties. The Company has an unsecured acquisition line of credit which permits borrowings of up to $150,000,000 of which $86 million is available at February 28, 1997. This credit facility provides temporary funds for new investments in healthcare facilities. The Company expects periodically to replace funds drawn on the acquisition line through long-term, fixed-rate borrowings, the issuance of equity linked borrowings, or the issuance of additional shares of capital stock. COMPETITION The Company competes for additional healthcare facility investments with other healthcare investors, including other real estate investment trusts. The operators of the facilities compete with other regional or local nursing care facilities for the support of the medical community, including physicians and acute care hospitals, as well as the general public. Some significant competitive factors for the placing of patients in skilled and intermediate care nursing facilities include quality of care, reputation, physical appearance of the facilities, services offered, family preferences, physician services and price. GOVERNMENT HEALTHCARE REGULATION AND REIMBURSEMENTS Healthcare is an area of extensive government regulation and dynamic regulatory change. The Company's lessees and mortgagors are and will continue to be subject to extensive federal, state and local regulation, including facility inspections, reimbursement policies, and control over certain expenditures. Changes in laws or regulations, or new interpretations of existing laws or regulations, can have a dramatic effect on methods of doing business, costs of doing business and amounts of reimbursement by government and private third-party payors. A significant portion of the revenues of the Company's lessees and mortgagors are and will be dependent upon reimbursement from third-party payors, including the Medicaid and Medicare programs, post-retirement benefit plans, private insurance companies and health maintenance organizations. Operators also are subject to extensive federal, state and local regulations relating to their operations, and the Company's facilities are subject to periodic inspection by government and other authorities to assure continual compliance with mandated procedures, licensure requirements under state law and certification standards under the Medicare and Medicaid programs. The levels of revenues and profitability of the Company's lessees and mortgagors will continue to be affected by the ongoing efforts of third-party payors to contain or reduce the costs of healthcare. In addition, in an attempt to reduce the United States' federal budget deficit, there have been, and the Company expects that there will continue to be, proposals to limit Medicaid and Medicare reimbursement for healthcare services. Proposals have also been made to limit Medicaid reimbursement for healthcare services in many of the states in which the Company's facilities are located. The Company cannot at this time predict whether any of these proposals will be adopted at the federal or state level or, if adopted and implemented, what effect, if any, such proposals will have on the lessees or mortgagors of the Company, and, indirectly, the Company. A significant change in coverage, reduction in payment rates by third-party payors, or the decline in availability of funding 3
5 could have a material adverse effect on the business and financial condition of the Company's lessees and mortgagors, and, indirectly, the Company's financial condition. There can be no assurance that the Medicaid reimbursement programs in each of the states where the lessees' and mortgagors' facilities are located will reimburse rent or interest costs of the lessees and mortgagors at increased levels recognizing the initial sales to or borrowings from the Company. Failure by these state Medicaid programs to provide reimbursement at current or increased levels could have an adverse effect upon the cash flow of the facilities and, hence, on the ability of the Company's lessees and mortgagors to meet their respective payment obligations to the Company. Other changes in the healthcare industry include continuing trends toward shorter lengths of hospital stay, increased use of outpatient services, increased federal, state and third party oversight of healthcare company operations and business practices, and increased demand for capitated healthcare services (delivery of services at a fixed price per capita basis to a defined group of covered parties). The entrance of insurance companies into managed care programs is also accelerating the introduction of managed care in new localities, and states and insurance companies continue to negotiate actively the amounts they will pay for services. Moreover, the percentage of healthcare services that are reimbursed under Medicare and Medicaid programs continues to increase as the population ages and as states expand their Medicaid programs. Continued eligibility to participate in these programs is crucial to a provider's financial strength. As a result of the foregoing, the revenues and margins of the operators of the Company's facilities may decrease, resulting in a reduction of the Company's rent/interest coverage from investments. CERTAIN FEDERAL INCOME TAX CONSIDERATIONS At all times, the Company intends to make and manage its investments (including the sale or disposition of property or other investments) and to operate in such a manner as to be consistent with the requirements of the Internal Revenue Code of 1986, as amended (the "Code") (or regulations thereunder) to qualify as a 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. As such, it generally will not pay federal income taxes on the portion of its income which is distributed to shareholders. EXECUTIVE OFFICERS OF THE COMPANY At the date of this report, the executive officers of the Company are: Essel W. Bailey, Jr. (52) has been President, Chief Executive Officer and Secretary of the Company since March 1992, and was a Managing Director of Omega Capital from 1986 to 1992. He was previously a partner in a major Michigan law firm. Mr. Bailey is also a director of Principal Healthcare Finance Limited and of Excellence Manufacturing, Inc., a supplier to the auto industry. David A. Stover (51) joined the Company as Vice President and Chief Financial Officer in September 1994. Mr. Stover is a Certified Public Accountant and has 23 years' experience with the international accounting firm of Ernst & Young LLP and its predecessor firms. From 1981 through 1990, he was an audit, tax and consulting partner, spending the last of those years as area partner-in-charge of services for the firm's healthcare clients in Western Michigan. From 1992 to 1994, Mr. Stover was principal of his own consulting firm and, from 1990 to 1992, he was Chief Financial Officer of International Research and Development Corporation. F. Scott Kellman (40) joined the Company as Senior Vice President-Acquisitions in August 1993, and was appointed Executive Vice President in August 1994. From 1986 to 1989, he was Vice President of Meritor Savings Bank, the last two years as director of the healthcare lending unit. From 1989 to 1991, he served as Vice President of Van Kampen Merritt, Inc., an investment banking subsidiary of Xerox. From September 1991 to December 1992, he was employed by Philadelphia First Group (Investment Bank), and from January 1993 through August of 1993 he was the Chief Operating Officer of Medical REIT. 4
6 James P. Flaherty (49) joined the Company in 1996 and was appointed Vice President-International and Managing Director of Omega U.K. Limited in January 1997. Before he joined the Company, he was Chairman of Black Rock Capital Corporation, a leasing and merchant banking firm he founded in 1994. From April 1991 until December of 1993 Mr. Flaherty was Managing Partner of Pareto Partners, a London based investment management firm. Prior to 1991, he was employed by American Express Bank Ltd. in a number of senior management capacities and by State National Bank of Connecticut and its successor, The Connecticut Bank & Trust Co.. OTHER KEY PERSONNEL Todd Robinson (31), Assistant Vice President; Director of Acquisitions, is a Certified Public Accountant who joined Omega in June 1995, after five years with the real estate group at Interstate/Johnson Lane, where he was responsible for the healthcare portfolio. Prior to Interstate, Mr. Robinson was a tax consultant with Arthur Andersen & Company, LLP. Joseph Emanuele (62) joined the Company in 1996 as Director of Management Operations. His responsibilities encompass internal operations, customer relations, evaluation, assessment and monitoring client operations. Mr. Emanuele has over 25 years in the nursing home industry, holding positions of administrator and Vice President of Operations. For more than 5 years prior to joining the Company, he was president of a management consulting firm specializing in computerized systems for healthcare operations. Carol Albaugh (34) joined the Company in December 1996 as Controller after completing her MBA at the University of Michigan. Prior to joining the Company, she held various progressively responsible positions at Borders Group Incorporated, most recently serving as Manager of Financial Planning and Analysis through March 1996. ITEM 2 -- PROPERTIES At December 31, 1996, the Company's real estate investments are in long-term care facilities and medical office buildings. The investments are either in the form of purchased facilities, which are leased to operators, or mortgages on facilities which are operated by the mortgagors or their affiliates. The facilities are located in 24 states and are operated by 34 unaffiliated operators. Basic information regarding investments as of December 31, 1996 is as follows: <TABLE> <CAPTION> NO. OF NO. OF INVESTMENT STRUCTURE/OPERATOR TOTAL BEDS FACILITIES OCCUPANCY % ----------------------------- ---------- ---------- ----------- <S> <C> <C> <C> PURCHASE/LEASEBACK PROPERTIES Advocat, Inc................................................ 3,119 29 83 Unison Healthcare Corp...................................... 1,664 17 74 Emerald Healthcare Inc...................................... 1,336 31 73 ExtendaCare, Inc............................................ 880 22 72 Regency Health Services ,Inc................................ 872 6 96 Alden Management Services, Inc.............................. 870 4 91 Res-Care, Inc............................................... 596 8 N/A Sun Healthcare Group, Inc................................... 517 4 87 First Health Care Associates................................ 360 1 69 Hunter Management Group, Inc................................ 300 1 90 Senior Care Properties, Inc................................. 280 1 76 Complete Care, Inc.......................................... 278 2 85 Meadowbrook Healthcare of N.C............................... 192 2 79 Kansas & Missouri, Inc...................................... 173 1 59 Integrated Health Services, Inc............................. 160 1 69 Liberty Assisted Living Centers, LP......................... 120 1 93 Tutera Evergreen, LLC....................................... 56 1 100 The Graduate Hospital....................................... 0 3 N/A ------ --- --- 11,773 135 81 </TABLE> 5
7 <TABLE> <CAPTION> NO. OF NO. OF INVESTMENT STRUCTURE/OPERATOR TOTAL BEDS FACILITIES OCCUPANCY % ----------------------------- ---------- ---------- ----------- <S> <C> <C> <C> CONVERTIBLE PARTICIPATING MORTGAGES Regency Health Services, Inc................................ 546 4 95 Unison Healthcare Corp...................................... 347 3 73 Premiere HCP III Hillsborough, Inc.......................... 180 1 60 Senior Care Properties, Inc................................. 150 2 91 ------ --- --- 1,223 10 84 PARTICIPATING MORTGAGES GranCare, Inc............................................... 1,863 13 88 North Country Healthcare Associates......................... 652 12 87 ExtendaCare, Inc............................................ 203 3 46 Advocat, Inc................................................ 317 3 90 ------ --- --- 3,035 31 86 FIXED-RATE MORTGAGES Horizon/CMS Healthcare Corp................................. 1,179 11 N/A American Healthcare Centers, Inc............................ 735 7 91 Advocat, Inc................................................ 423 4 92 Tiffany Care Centers........................................ 330 5 79 Emerald Healthcare, Inc..................................... 300 2 96 Integrated Health Services, Inc............................. 95 1 69 Senior Care Properties, Inc................................. 76 1 81 Quality Care, Inc........................................... 75 1 76 Other Mortgages............................................. 991 9 N/A ------ --- --- 4,204 41 89 ------ --- --- Totals................................................. 20,235 217 83 ====== === === </TABLE> - ------------------------- N/A -- Data are not reported or not applicable. The distribution of real estate investments by investment type and state is as follows: <TABLE> <CAPTION> TOTAL NUMBER OF TOTAL INVESTMENT INVESTMENT INVESTMENT STRUCTURE/STATE FACILITIES BEDS ($1,000) YIELD -------------------------- ---------- ----- ---------- ---------- <S> <C> <C> <C> <C> PURCHASE/LEASEBACK PROPERTIES Indiana............................................... 68 3,327 $101,581 12.21% Arkansas.............................................. 12 1,273 37,888 12.90 Texas................................................. 10 1,485 27,125 11.45 Kentucky.............................................. 10 1,103 35,141 11.03 Illinois.............................................. 7 1,074 37,661 11.13 No. Carolina.......................................... 6 805 27,419 10.16 Tennessee............................................. 5 606 17,447 11.22 Alabama............................................... 4 521 11,639 12.75 Pennsylvania.......................................... 3 0 30,031 13.54 Florida............................................... 2 420 14,146 12.10 West Virginia......................................... 2 182 5,573 11.85 Missouri.............................................. 1 360 9,000 12.28 Kansas................................................ 1 173 2,500 8.75 Washington............................................ 1 160 10,000 10.75 Ohio.................................................. 1 151 5,640 11.85 Iowa.................................................. 1 77 2,636 10.50 Colorado.............................................. 1 56 750 12.80 --- ------ -------- ----- Total Purchase/Leasebacks........................ 135 11,773 376,177 11.85 </TABLE> 6
8 <TABLE> <CAPTION> TOTAL NUMBER OF TOTAL INVESTMENT INVESTMENT INVESTMENT STRUCTURE/STATE FACILITIES BEDS ($1,000) YIELD -------------------------- ---------- ----- ---------- ---------- <S> <C> <C> <C> <C> CONVERTIBLE PARTICIPATING MORTGAGES Tennessee............................................. 4 546 18,232 13.65 Texas................................................. 3 347 10,200 11.87 Florida............................................... 3 330 10,941 11.79 --- ------ -------- ----- Total Convertible Participating.................. 10 1,223 39,373 12.67 PARTICIPATING MORTGAGES MICHIGAN Michigan.............................................. 13 1,863 58,800 14.56 Maine................................................. 11 619 24,317 11.36 Florida............................................... 3 317 7,031 13.20 Kentucky.............................................. 3 203 4,423 11.63 Massachusetts......................................... 1 33 2,108 11.36 --- ------ -------- ----- Total Participating Mortgages.................... 31 3,035 96,679 13.33 FIXED RATE MORTGAGES Texas................................................. 10 1,146 10,519 10.75 Ohio.................................................. 7 735 19,481 11.26 Florida............................................... 6 723 25,964 11.68 California............................................ 6 571 7,739 11.04 Missouri.............................................. 5 330 5,421 11.83 Iowa.................................................. 2 250 3,310 10.75 New Mexico............................................ 2 156 1,415 10.75 Tennessee............................................. 1 120 2,939 10.75 Utah.................................................. 1 100 1,671 10.75 Nevada................................................ 1 73 521 10.75 Other, primarily construction......................... 2,442 11.00 --- ------ -------- ----- Total Fixed Rate Mortgages....................... 41 4,204 81,422 11.27 --- ------ -------- ----- Total Real Estate Investments.................... 217 20,235 $593,651 12.07% === ====== ======== ===== </TABLE> ITEM 3 -- LEGAL PROCEEDINGS There were no legal proceedings pending as of December 31, 1996, or as of the date of this report, to which the Company is a party or to which the properties are subject, which were likely to have a material adverse effect on the operations of the Company or on its financial condition. ITEM 4 -- SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS No matters were submitted to shareholders during the fourth quarter of the year covered by this report. 7
9 PART II ITEM 5 -- MARKET FOR REGISTRANTS' COMMON EQUITY AND RELATED SHAREHOLDER MATTERS The Company's shares of common stock are traded on the New York Stock Exchange under the symbol OHI. The following table sets forth, for the periods shown, the high and low prices as reported on the New York Stock Exchange Composite and dividends per share: <TABLE> <CAPTION> 1996 1995 - ------------------------------------------ -------------------------------------------- DIVIDENDS DIVIDENDS QUARTER HIGH LOW PER SHARE QUARTER HIGH LOW PER SHARE - ------- ---- --- --------- ------- ---- --- --------- <S> <C> <C> <C> <C> <C> <C> <C> <C> First $29.750 $26.375 $0.62 First $24.250 $23.500 $0.59 Second $29.125 $27.125 $0.62 Second $26.625 $23.625 $0.59 Third $30.125 $27.750 $0.62 Third $27.125 $25.375 $0.59 Fourth $33.500 $29.125 $0.62 Fourth $27.125 $23.500 $0.59 ----- ----- $2.48 $2.36 </TABLE> The closing price on February 28, 1997 was $31.375 per share. As of February 28, 1997, there were 18,784,560 shares of common stock outstanding with approximately 3,200 registered holders and approximately 30,000 beneficial owners. ITEM 6 -- SELECTED FINANCIAL DATA The following selected financial data with respect to the Company should be read in conjunction with the Company's Consolidated Financial Statements which are incorporated herein by reference to the Company's 1996 Annual Report to Shareholders, which is included herein as Exhibit 13. <TABLE> <CAPTION> PERIOD FROM DATE OF INCORPORATION TO YEAR ENDED DECEMBER 31, DECEMBER 31, ------------------------------------- ------------- 1996 1995 1994(2) 1993 1992(1) ---- ---- ------- ---- ------- (IN THOUSANDS, EXCEPT PER SHARE AMOUNTS) <S> <C> <C> <C> <C> <C> OPERATING DATA Revenues.................................... $73,127 $61,430 $37,747 $20,750 $5,968 Net Earnings before Extraordinary Charge from Prepayment of Debt................ 34,590 29,490 17,777 11,573 4,424 Net Earnings................................ 34,590 23,011 17,777 11,573 4,424 Per Share Amounts: Net Earnings before Extraordinary Charge............................... $ 2.01 $ 1.83 $ 1.70 $ 1.78 $ 0.68 Net Earnings........................... 2.01 1.43 1.70 1.78 0.68 Dividends (3).......................... 2.48 2.36 2.20 2.04 0.26 Weighted Average Shares Outstanding......... 17,196 16,071 10,451 6,513 6,464 </TABLE> 8
10 <TABLE> <CAPTION> DECEMBER 31, ---------------------------------------------------- 1996 1995 1994 1993 1992 ---- ---- ---- ---- ---- <S> <C> <C> <C> <C> <C> BALANCE SHEET DATA Cost of Investments....................... $643,261 $547,923 $475,961 $231,751 $142,970 Total Assets.............................. 634,836 551,188 500,731 243,587 144,752 Acquisition Line of Credit................ 6,000 74,690 20,000 14,500 14,083 Long-Term Borrowings...................... 135,659 120,453 133,602 103,573 6,246 Subordinated Convertible Debentures....... 94,810 Shareholders' Equity...................... 383,007 347,129 338,543 122,714 122,510 </TABLE> - ------------------------- (1) As described in Note 1 to the Consolidated Financial Statements, operations commenced on August 14, 1992. (2) As described in Note 13 to the Consolidated Financial Statements, the Company acquired Health Equity Properties Incorporated on September 30, 1994. (3) Dividends per share are those declared and paid during such period. ITEM 7 -- MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS The information required by this item is incorporated herein by reference to the caption "Management's Discussion and Analysis" on Pages 10 through 12 of the Company's Annual Report to Shareholders, included herein as Exhibit 13. ITEM 8 -- FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA The information required by this item is incorporated herein by reference to the Consolidated Financial Statements included in Pages 13 through 23 of the Company's Annual Report to Shareholders, included herein as Exhibit 13. ITEM 9 -- CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE Not applicable. PART III ITEM 10 -- DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT The information required by this item is contained in Item 1 herein or incorporated herein by reference to the Company's definitive proxy statement for the Annual Meeting of Shareholders to be held on April 15, 1997, which was filed with the Securities and Exchange Commission pursuant to Regulation 14A on March 6, 1997. ITEM 11 -- EXECUTIVE COMPENSATION The information required by this item is incorporated herein by reference to the Company's definitive proxy statement for the Annual Meeting of Shareholders to be held on April 15, 1997, which was filed on March 6, 1997 with the Securities and Exchange Commission pursuant to Regulation 14A. ITEM 12 -- SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT The information required by this item is incorporated herein by reference to the Company's definitive proxy statement for the Annual Meeting of Shareholders to be held on April 15, 1997, which was filed on March 6, 1997 with the Securities and Exchange Commission pursuant to Regulation 14A. 9
11 ITEM 13 -- CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS The information required by this item is incorporated herein by reference to the Company's definitive proxy statement for the Annual Meeting of Shareholders to be held on April 15, 1997, which was filed on March 6, 1997 with the Securities and Exchange Commission pursuant to Regulation 14A. PART IV ITEM 14 -- EXHIBITS, FINANCIAL STATEMENTS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K (a)(1) Listing of Consolidated Financial Statements -- See Index to Financial Information on Page 4 of Exhibit 13 of this report. (a)(2) Listing of Financial Statement Schedules -- See Index to Financial Information on Page 4 of Exhibit 13 of this report. (a)(3) Listing of Exhibits -- See Index to Exhibits beginning on Page 14 of this report. (b) Reports on Form 8-K. There were no reports on Form 8-K filed during the fourth quarter of 1996. (c) Exhibits -- See Index to Exhibits beginning on Page 14 of this report. (d) Financial Statement Schedules -- The following consolidated financial statement schedules are included herein: Schedule III Real Estate and Accumulated Depreciation Schedule IV Mortgage Loan on Real Estate All other schedules for which provision is made in the applicable accounting regulation of the Securities and Exchange Commission are not required under the related instructions or are inapplicable and therefore have been omitted. 10
12 SCHEDULE III REAL ESTATE AND ACCUMULATED DEPRECIATION OMEGA HEALTHCARE INVESTORS, INC. DECEMBER 31, 1996 <TABLE> <CAPTION> COLUMN A COLUMN B COLUMN C COLUMN D COLUMN E(5) COLUMN F - -------------------------------- ------------ ------------ ----------------------- ------------------ --------------- GROSS AMOUNT AT WHICH CARRIED AT CLOSE OF PERIOD INITIAL COST ------------------ TO COMPANY COST CAPITALIZED ------------ SUBSEQUENT TO ACQUISITION BUILDINGS BUILDINGS ----------------------- AND LAND AND LAND CARRYING IMPROVEMENTS ACCUMULATED DESCRIPTION(1) ENCUMBRANCES IMPROVEMENTS IMPROVEMENTS COSTS TOTAL DEPRECIATION(6) -------------- ------------ ------------ ------------ -------- ------------ --------------- <S> <C> <C> <C> <C> <C> <C> Advocat, Inc.: Alabama (LTC)................. $11,638,797 $ 0 $0 $11,638,797 $1,527,726 Arkansas (LTC)................ 37,887,832 0 0 37,887,832 5,094,068 Tennessee (LTC)............... (2) 9,542,121 0 0 9,542,121 1,282,407 Kentucky (LTC)................ (3) 16,149,775 884,589 0 17,034,364 937,091 Ohio (LTC).................... 5,854,186 0 5,854,186 390,272 West Virginia (LTC)........... 5,283,525 153,695 0 5,437,220 289,320 ----------- ---------- ----------- ---------- 86,356,237 1,038,284 0 87,394,520 9,520,884 Unison Healthcare Corp.: (formerly BritWill Healthcare Company): Indiana (LTC)................. 19,760,000 624,000 0 20,384,000 2,481,741 Texas (LTC)................... 13,810,000 138,515 0 13,948,515 964,396 ----------- ---------- ----------- ---------- 33,570,000 762,515 0 34,332,515 3,446,137 The Graduate Hospital: Pennsylvania (MOB)............ 30,031,250 0 0 30,031,250 3,465,325 Liberty Assisted Living Centers LTD Partnership: Florida (LTC)................. 5,994,730 760 0 5,995,490 512,638 Regency Health Services, Inc.: North Carolina (LTC).......... 8,818,000 0 0 8,818,000 860,633 North Carolina (LTC).......... 11,100,131 0 0 11,100,131 529,376 Tennessee (LTC)............... (2) 7,905,139 0 0 7,905,139 608,406 ----------- ---------- ----------- ---------- 27,823,270 0 27,823,270 1,998,415 Alden Management Services, Inc: Illinois (LTC)................ 31,000,000 0 0 31,000,000 2,324,883 Emerald Healthcare, Inc.: Illinois (LTC)................ 2,963,578 0 0 2,963,578 309,667 Indiana (LTC)................. 33,782,788 0 0 33,782,788 2,965,580 ----------- ---------- ----------- ---------- 36,746,366 36,746,366 3,275,247 ExtendaCare, Inc.: Indiana (LTC)................. 23,553,634 0 0 23,553,634 2,076,018 Res-Care Health Services, Inc.: Indiana (LTC)................. 20,470,968 0 0 20,470,968 1,614,977 Kentucky (LTC)................ 8,029,032 0 0 8,029,032 592,965 ----------- ---------- ----------- ---------- 28,500,000 0 0 28,500,000 2,207,942 <CAPTION> COLUMN A COLUMN G COLUMN H COLUMN I - -------------------------------- ---------- ------------------ ----------------- LIFE ON WHICH DEPRECIATION IN LATEST DATE OF DATE INCOME STATEMENTS DESCRIPTION(1) RENOVATION ACQUIRED IS COMPUTED -------------- ---------- -------- ----------------- <S> <C> <C> <C> Advocat, Inc.: 1948-1995 Alabama (LTC)................. August 14, 1992 31.5 years Arkansas (LTC)................ August 14, 1992 31.5 years Tennessee (LTC)............... August 14, 1992 31.5 years Kentucky (LTC)................ July 1, 1994 33 years Ohio (LTC).................... July 1, 1994 33 years West Virginia (LTC)........... July 1, 1994 33 years Unison Healthcare Corp.: 1963-1993 (formerly BritWill Healthcare Company): Indiana (LTC)................. December 23, 1992 31.5 years Texas (LTC)................... December 1, 1993 39 years The Graduate Hospital: 1929-1984 Pennsylvania (MOB)............ October 28, 1993 27.5 years Liberty Assisted Living Centers LTD Partnership: 1989 Florida (LTC)................. September 30, 1994 27 years Regency Health Services, Inc.: 1974-1986 North Carolina (LTC).......... June 30, 1994 39 years North Carolina (LTC).......... September 30, 1994 29 years Tennessee (LTC)............... September 30, 1994 30 years Alden Management Services, Inc: 1958-1981 Illinois (LTC)................ September 30, 1994 30 years Emerald Healthcare, Inc.: 1960-1975 Illinois (LTC)................ April 1, 1996 25 years Indiana (LTC)................. April 1, 1996 25 years ExtendaCare, Inc.: 1967-1974 Indiana (LTC)................. January 16, 1996 25 years Res-Care Health Services, Inc.: 1962-1972 Indiana (LTC)................. September 30, 1994 25-30 years Kentucky (LTC)................ September 30, 1994 30 years </TABLE> 11
13 <TABLE> <CAPTION> COLUMN A COLUMN B COLUMN C COLUMN D COLUMN E(5) COLUMN F - ------------------------ ------------ --------------- ----------------------- ---------------- --------------- GROSS AMOUNT AT WHICH CARRIED AT CLOSE OF PERIOD INITIAL COST TO ---------------- COMPANY COST CAPITALIZED --------------- SUBSEQUENT TO ACQUISITION BUILDINGS BUILDINGS ----------------------- AND LAND AND LAND CARRYING IMPROVEMENTS ACCUMULATED DESCRIPTION(1) ENCUMBRANCES IMPROVEMENTS IMPROVEMENTS COSTS TOTAL DEPRECIATION(6) -------------- ------------ ------------ ------------ -------- ------------ --------------- <S> <C> <C> <C> <C> <C> <C> Integrated Health Services, Inc.: Washington (LTC)............... $ 10,000,000 $ 0 $0 $ 10,000,000 $ 595,833 Sun Healthcare Group, Inc.: Iowa (LTC)..................... 2,700,000 0 0 2,700,000 12,237 Illinois (LTC)................. 4,900,000 0 0 4,900,000 67,446 Indiana (LTC).................. 3,000,000 0 0 3,000,000 11,024 Texas (LTC).................... 7,100,000 0 0 7,100,000 96,125 ------------ ---------- ------------ ----------- 17,700,000 0 0 17,700,000 186,832 Hunter Management Group Inc.: Florida (LTC).................. 8,150,000 0 0 8,150,000 577,277 Meadowbrook Healthcare of North Carolina: North Carolina (LTC)........... 7,500,000 0 0 7,500,000 546,158 Senior Care Properties, Inc.: Texas (LTC).................... 5,200,000 0 0 5,200,000 291,375 First HealthCare Associates: Missouri (LTC)................. 9,000,000 0 0 9,000,000 880,103 Miscellaneous Investments: (4) 13,250,000 0 0 13,250,000 979,037 ------------ ---------- - ------------ ----------- $374,375,487 $1,801,559 $0 $376,177,045 $32,884,104 ============ ========== ============ =========== <CAPTION> COLUMN A COLUMN G COLUMN H COLUMN I - ------------------------ ---------- ------------------ ----------------- LIFE ON WHICH DEPRECIATION IN LATEST DATE OF DATE INCOME STATEMENTS DESCRIPTION(1) RENOVATION ACQUIRED IS COMPUTED -------------- ---------- -------- ----------------- <S> <C> <C> <C> Integrated Health Services, Inc.: 1965-1967 Washington (LTC)............... September 1, 1996 20 year Sun Healthcare Group, Inc.: 1965-1975 Iowa (LTC)..................... August 30, 1996 30 years Illinois (LTC)................. August 30, 1996 30 years Indiana (LTC).................. August 30, 1996 30 years Texas (LTC).................... August 30, 1996 30 years Hunter Management Group Inc.: 1977-1978 Florida (LTC).................. September 13, 1993 39 years Meadowbrook Healthcare of North Carolina: 1984-1985 North Carolina (LTC)........... September 30, 1994 31.5 years Senior Care Properties, Inc.: 1929-1975 Texas (LTC).................... January 1, 1995 31.5 years First HealthCare Associates: 1978-1986 Missouri (LTC)................. August 14, 1992 31.5 years Miscellaneous Investments: 1956-1985 Various 20-39 years </TABLE> - ------------------ (1) All of the real estate included in this schedule are being used in either the operation of long-term care facilities (LTC) or medical office buildings (MOB) located in the states indicated. (2) Certain of the real estate indicated are security for Industrial Development Revenue Bonds totaling $9,150,000 at December 31, 1996. (3) Certain of the real estate indicated are security for notes payable totaling $8,159,467 at December 31, 1996 (4) Certain of the real estate indicated are security for HUD loans totaling $6,964,967 at December 31, 1996 <TABLE> <CAPTION> COLUMN E 1994 1995 1996 -------- ---- ---- ---- <S> <C> <C> <C> (5) Balance at beginning of period.......................... $127,110,000 $334,600,764 $357,556,246 Additions during period: Acquisitions........................................... 207,018,000 22,747,486 17,700,000 Improvements and other................................. 472,764 207,996 920,799 ------------ ------------ ------------ Balance at close of period............................... $334,600,764 $357,556,246 $376,177,045 ============ ============ ============ </TABLE> Additions for 1994 include $165,000,000 stemming from the merger with Health Equity Properties Incorporated and $4,560,000 from a conversion of a mortgage to purchase/lease back. <TABLE> <CAPTION> COLUMN F 1994 1995 1996 -------- ---- ---- ---- <S> <C> <C> <C> (6) Balance at beginning of period.......................... $3,357,328 $ 9,552,587 20,836,153 Additions during period: Provisions for depreciation............................ 6,195,259 11,283,566 12,047,951 ---------- ----------- ----------- Balance at close of period............................... $9,552,587 $20,836,153 $32,884,104 ========== =========== =========== </TABLE> 12
14 SCHEDULE IV MORTGAGE LOANS ON REAL ESTATE OMEGA HEALTHCARE INVESTORS, INC. DECEMBER 31, 1996 <TABLE> <CAPTION> COLUMN A COLUMN B COLUMN C COLUMN D COLUMN E - ------------------------------- ------------ ------------------ --------------------------------------------------- -------- FINAL INTEREST MATURITY PRIOR DESCRIPTION(1) RATE DATE PERIODIC PAYMENT TERMS LIENS -------------- -------- -------- ---------------------- ----- <S> <C> <C> <C> <C> Michigan (13 LTC facilities)... 14.56% August 13, 2007 - Interest payable at 13.56% payable monthly None - Deferred interest at 1% accrues monthly and is payable at maturity of the note - Quarterly amortization of $1,470,000 commencing in the year 2002 Florida (3 LTC facilities)..... 13.20% August 4, 2012 - Interest payable monthly None - Quarterly amortization of $50,000 commencing in the year 2002 Florida (4 LTC facilities)..... 11.50% February 28, 2010 - Interest plus principal of $124,826 payable None monthly Florida (2 LTC facilities)..... 11.50% June 4, 2006 - Interest plus principal of $107,382 payable None monthly Maine (11 LTC facilities) Massachusetts (1 LTC facility)..................... 11.36% September 30, 2000 - Interest payable monthly None - Quarterly payment of $37,500 commencing in 1996 Texas (6 LTC facilities)....... 11.87% December 31, 2003 - Interest payable monthly None - Annual amortization of $60,000 commencing in years 1997-1999 and $120,000 commencing in year 2000 Texas (8 LTC facilities)....... 10.75% Various - Interest plus principal of $105,000 payable None monthly Tennessee (2 LTC facilities)... 13.58% April 30, 2001 - Interest payable monthly None Tennessee (2 LTC facilities)... 12.44% August 1, 2016 - Interest payable monthly None Ohio (7 LTC facilities)........ 11.00% January 1, 2015 - Interest plus principal of $207,570 payable None monthly Other Mortgage Notes: Various........................ 11% to 13.5% 1998 to 2005 - Interest payable monthly None <CAPTION> COLUMN A COLUMN F COLUMN G COLUMN H - ------------------------------- ------------ --------------- ---------------- PRINCIPAL AMOUNT OF LOANS SUBJECT FACE CARRYING TO DELINQUENT AMOUNT OF AMOUNT OF PRINCIPAL OR DESCRIPTION(1) MORTGAGES MORTGAGES(2)(3) INTEREST -------------- --------- --------------- ---------------- <S> <C> <C> <C> Michigan (13 LTC facilities)... $ 58,800,000 $ 58,800,000 None Florida (3 LTC facilities)..... $ 7,031,250 $ 7,031,250 None Florida (4 LTC facilities)..... $ 12,691,500 $ 12,879,505 None Florida (2 LTC facilities)..... $ 11,090,000 $ 11,084,377 None Maine (11 LTC facilities) Massachusetts (1 LTC facility)..................... $ 26,500,000 $ 26,425,000 None Texas (6 LTC facilities)....... $ 10,200,000 $ 10,200,000 None Texas (8 LTC facilities)....... $ 8,597,966 $ 8,597,966 None Tennessee (2 LTC facilities)... $ 8,932,000 $ 8,932,000 None Tennessee (2 LTC facilities)... $ 9,300,000 $ 9,300,000 Ohio (7 LTC facilities)........ $ 20,031,888 $ 19,481,229 None Other Mortgage Notes: Various........................ $ 50,552,905 $ 44,742,745 None ------------ ------------ $223,727,509 $217,474,072 ============ ============ </TABLE> - ------------------------- (1) The mortgage loans included in this schedule represent first mortgages on facilities used in the delivery of long-term healthcare, such facilities are located in the state indicated and are being operated by the indicated operator. (2) The aggregate cost for federal income tax purposes is equal to the carrying amount. <TABLE> <CAPTION> COLUMN G RECONCILIATION 1994 1995 1996 ----------------------- ---- ---- ---- <S> <C> <C> <C> <C> (3) Balance at beginning of period................... $104,641,250 $141,359,387 $158,289,097 Additions during period -- Placements............ 41,334,218 21,131,000 66,222,620 Deductions during period: Collections of principal......................... (56,081) (850,959) (956,646) Conversion to purchase/leaseback................. (4,560,000) (3,350,331) (6,080,999) ------------ ------------ ------------ Balance at close of period....................... $141,359,387 $158,289,097 $217,474,072 ============ ============ ============ </TABLE> 13
15 INDEX TO EXHIBITS <TABLE> <CAPTION> SEQUENTIALLY EXHIBIT NUMBERED NUMBER DESCRIPTION PAGES - ------- ----------- ------------ <C> <S> <C> 3.1 Articles of Incorporation, as amended, of the Registrant, filed as Exhibit 3.1 to the Registrant's Form 10-Q for the quarter ended March 31, 1995 and incorporated herein by this reference. ................................................. 3.2 Amended and Restated Bylaws of the Registrant, as amended August 17, 1993 (Incorporated by reference to Exhibit 3.2 to the Company's Registration Statement on Form S-4 (#33-70612) dated October 21, 1993)..................................... 4.1 Form of Convertible Debenture (Incorporated by reference to Exhibit 4.2 to the Company's Form S-3 dated February 3, 1997)....................................................... 4.2 Form of Indenture (Incorporated by reference to Exhibit 4.2 to the Company's Form S-3 dated February 3, 1997)........... 4.3 Indenture dated December 27, 1993 (Incorporated by reference to Exhibit 4.2 to the Company's Form S-3 dated December 29, 1993) 4.4 First Supplemental Indenture dated January 23, 1996 (Incorporated by reference to Exhibit 4 to the Company's Form 8-K dated January 19, 1996)............................ 4.5 1993 Stock Option and Restricted Stock Plan, as amended (Incorporated by reference to Exhibit 10.11 to the Company's Form 10-Q for the quarterly period ended March 31, 1995).... 8 Opinion of Counsel to the Registrant regarding tax consequences.*.............................................. 10.1 Agreement of Acquisition and Lease by and between the Registrant and Diversicare Corporation of America dated June 1992 (Incorporated by reference to Exhibit 10.4 to the Company's Registration Statement (#33-48268) on Form S-11 effective August 7, 1992)................................... 10.2 Form of Master Lease with Diversicare (Incorporated by reference to Exhibit 10.5 to the Company's Registration Statement (#33-48268) on Form S-11 effective August 7, 1992)....................................................... 10.3 Loan Agreement by and between the Registrant, First Property Management, Inc., Professional Health Care Management, Inc., and certain affiliates dated June 1992, Form of Mortgage Note for Michigan facilities, and Form of First Amendment to Michigan Loan Agreement (Incorporated by reference to Exhibit 10.6 to the Company's Registration Statement (#33-48268) on Form S-11 effective August 7, 1992).......... 10.4 Form of Participating Mortgage for Michigan facilities (Incorporated by reference to Exhibit 10.7 to the Company's Registration Statement (#33-48268) on Form S-11 effective August 7, 1992)............................................. 10.5 First Amendment to Michigan Loan Agreement by and between the Registrant and Professional Health Care Management, Inc., dated August 14, 1992 (Incorporated by reference to Exhibit 10.3 in the Company's Registration Statement on Form S-11 (#33-51922) effective October 1, 1992)................. 10.6 Support Agreement dated August 14, 1992, whereby the Parent of Diversicare agrees to support the financial obligations of Diversicare under the Amended and Restated Agreement of Acquisition (Incorporated by reference to Exhibit 10.6 to the Company's Registration Statement (#33-51922) on Form S-11 effective October 1, 1992)............................. </TABLE> 14
16 <TABLE> <CAPTION> SEQUENTIALLY EXHIBIT NUMBERED NUMBER DESCRIPTION PAGES - ------- ----------- ------------ <C> <S> <C> 10.7 Master Lease, as amended by Amendment Agreement dated December 22, 1992 (Incorporated by reference to Exhibit 10.2 to the Company's Form 8-K dated December 24, 1992).......... 10.8 Second Amendment to Master Lease, as amended by Amendment Agreement dated December 24, 1992 (Incorporated by reference to Exhibit 10.13 to the Company's Form 10-K for the year ended December 31, 1992).................................... 10.9 1993 Retirement Plan for Directors, effective March 2, 1993 (Incorporated by reference to Exhibit 10.15 to the Company's Form 10-K for the year ended December 31, 1992)............. 10.10 1993 Deferred Compensation Plan, effective March 2, 1993 (Incorporated by reference to Exhibit 10.16 to the Company's Form 10-K for the year ended December 31, 1992)............. 10.11 Form of Note Exchange Agreement -- 10% Senior Notes due July 15, 2000 (Incorporated by reference to Exhibit 10.1 to the Company's Form 10-Q for the quarterly period ended September 30, 1995)................................................... 10.12 Form of Note Exchange Agreement -- 7.4% Senior Notes due July 15, 2000 (Incorporated by reference to Exhibit 10.2 to the Company's Form 10-Q for the quarterly period ended September 30, 1995)......................................... 10.13 Form of Note Purchase Agreement -- 7.4% Senior Notes due July 15, 2000 (Incorporated by reference to Exhibit 10.25 to the Company's Form 10-K for the year ended December 31, 1995)....................................................... 10.14 Amended and Restated Loan Agreement with Fleet Bank, N.A., et al. (Incorporated by reference to the Company's Form 10-Q for the quarterly period ended June 30, 1996) 11 Statement re: computation of per share earnings*............ 13 Excerpts from Omega Healthcare Investors, Inc. Annual Report to Shareholders for the period ended December 31, 1996, to the extent referred to in Part II of this Form 10-K*........ 21 Subsidiaries of the Registrant*............................. 23 Consent of Independent Auditors*............................ </TABLE> - ------------------------- * Exhibits which are filed herewith on the indicated sequentially numbered page. 15
17 SIGNATURES Pursuant to the requirements of Sections 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. OMEGA HEALTHCARE INVESTORS, INC. By: /s/ DAVID A. STOVER ------------------------------------ David A. Stover Chief Financial Officer Dated: March 28, 1997 Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed by the following persons on behalf of the Registrant and in the capacities on the date indicated . <TABLE> <CAPTION> SIGNATURES TITLE DATE ---------- ----- ---- <C> <S> <C> PRINCIPAL EXECUTIVE OFFICER /s/ ESSEL W. BAILEY, JR. Chairman, President, Chief March 28, 1997 - ------------------------------------------------ Executive Officer, Secretary and Essel W. Bailey, Jr. Director PRINCIPAL FINANCIAL OFFICER and PRINCIPAL ACCOUNTING OFFICER /s/ DAVID A. STOVER Vice President, Chief Financial March 28, 1997 - ------------------------------------------------ Officer and Chief Accounting David A. Stover Officer DIRECTORS /s/ JAMES A. EDEN Director March 28, 1997 - ------------------------------------------------ James A. Eden /s/ THOMAS F. FRANKE Director March 28, 1997 - ------------------------------------------------ Thomas F. Franke /s/ HAROLD J. KLOOSTERMAN Director March 28, 1997 - ------------------------------------------------ Harold J. Kloosterman /s/ BERNARD J. KORMAN Director March 28, 1997 - ------------------------------------------------ Bernard J. Korman /s/ EDWARD LOWENTHAL Director March 28, 1997 - ------------------------------------------------ Edward Lowenthal /s/ ROBERT L. PARKER Director March 28, 1997 - ------------------------------------------------ Robert L. Parker </TABLE> 16