8-K: Current report filing
Published on February 10, 2009
UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
WASHINGTON,
D.C. 20549
FORM
8-K
CURRENT
REPORT
Pursuant
to Section 13 or 15(d) of the
Securities
Exchange Act of 1934
Date of
report (Date of earliest event reported): February 4, 2009
OMEGA
HEALTHCARE INVESTORS, INC.
(Exact
name of registrant as specified in charter)
|
Maryland
|
1-11316
|
38-3041398
|
|
(State
of incorporation)
|
(Commission
File Number)
|
(IRS
Employer
Identification
No.)
|
200
International Circle
Suite
3500
Hunt
Valley, Maryland 21093
(Address
of principal executive offices / Zip Code)
(410)
427-1700
(Registrant’s
telephone number, including area code)
Check
the appropriate box below if the Form 8-K filing is intended to simultaneously
satisfy the filing obligation of the registrant under any of the following
provisions:
Soliciting material pursuant to Rule
14a-12 under the Exchange Act.
Pre-commencement communications
pursuant to Rule 14d—2(b) under the Exchange Act.
Pre-commencement communications
pursuant to Rule 13e—4(c) under the Exchange Act.
Item
5.02 Departure of Directors or Certain Officers; Election of
Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain
Officers.
2008 Executive Officer
Bonuses
The
executive officers of Omega Healthcare Investors, Inc. (the “Company”) are
eligible for annual cash bonuses as set forth below:
|
Bonus
Opportunity
As Percentage of Base
Salary
|
||||
|
C.
Taylor Pickett
|
100 | % | ||
|
Daniel
J. Booth
|
50 | % | ||
|
Robert
O. Stephenson
|
50 | % | ||
|
R.
Lee Crabill
|
50 | % | ||
|
Michael
D. Ritz
|
35 | % | ||
The
amount of bonus payments is based on criteria determined by the Compensation
Committee of the Board of Directors. For 2008, the Compensation
Committee determined that fifty percent of the bonus opportunity would be based
on the Company’s adjusted funds from operations (“FFO”), with the remaining
fifty percent based on a subjective assessment of individual
performance. The Company’s actual adjusted FFO for 2008 exceeded
budget by over $7.9 million, although adjusted FFO per share available to common
stockholders was $0.0031 less than the originally budgeted per share target due
to the dilutive impact of an additional common stock offering that was not
anticipated in the original budget. On September 19, 2008, the
Company completed an underwritten public offering of 6.0 million shares of its
common stock at a price of $16.37 per share. The net proceeds, after
deducting underwriting discounts and offering expenses, were approximately $97
million. . The net proceeds were used to repay
indebtedness under the Company's senior credit facility and for working capital
and general corporate purposes. The Company’s Board of Directors
determined that it was in the best interests of the Company to complete an
equity offering at that time in view of prevailing conditions in the capital
markets and general economic conditions.
On
February 4, 2009, the Compensation Committee determined to payout the adjusted
FFO component of executive officer bonuses, noting that it would be
inappropriate to penalize executive officers for the dilutive impact of a
successfully completed equity financing on favorable pricing terms, especially
in view of then prevailing general economic and capital markets
conditions. The Compensation Committee also noted their subjective
evaluation of the Company’s overall performance in 2008. Accordingly,
the Compensation Committee approved the following cash bonuses relating to
2008:
|
Adjusted
FFO- Related Portion
of Bonus
|
Subjective
Portion of
Bonus
|
Additional
Discretionary
Cash Bonus
|
Total
Cash
Bonus
|
|||||||||||||
|
C.
Taylor Pickett
|
$ | 274,750 | $ | 274,750 | -- | $ | 549,500 | |||||||||
|
Daniel
J. Booth
|
$ | 84,625 | $ | 84,625 | -- | $ | 169,250 | |||||||||
|
Robert
O. Stephenson
|
$ | 68,000 | $ | 68,000 | $ | 20,000 | $ | 156,000 | ||||||||
|
R.
Lee Crabill
|
$ | 65,625 | $ | 65,625 | -- | $ | 131,250 | |||||||||
|
Michael
D. Ritz
|
$ | 31,763 | $ | 31,762 | $ | 10,000 | $ | 73,525 | ||||||||
2009 Executive Officer
Bonuses
For 2009,
the Compensation Committee has determined that executive officer bonuses will be
entirely based on the subjective evaluation of performance, with 50% based on a
review of overall corporate performance and 50% based on the review of
individual corporate performance.
Information Regarding
Non-GAAP Financial Measures
FFO and
adjusted FFO are non-GAAP financial measures. The Company
calculates and reports FFO in accordance with the definition and interpretive
guidelines issued by the National Association of Real Estate Investment Trusts
("NAREIT"), and consequently, FFO is defined as net income available to common
stockholders, adjusted for the effects of asset dispositions and certain
non-cash items, primarily depreciation and amortization. The Company
believes that FFO is an important supplemental measure of its operating
performance. Because the historical cost accounting convention used
for real estate assets requires depreciation (except on land), such accounting
presentation implies that the value of real estate assets diminishes predictably
over time, while real estate values instead have historically risen or fallen
with market conditions. The term FFO was designed by the real estate
industry to address this issue. FFO as used herein is not necessarily comparable
to FFO of other real estate investment trusts, or REITs, that do not use the
same definition or implementation guidelines or interpret the standards
differently from the Company. The Company uses FFO as one of several
criteria to measure operating performance of its business. The
Company further believes that by excluding the effect of depreciation,
amortization and gains or losses from sales of real estate, all of which are
based on historical costs and which may be of limited relevance in evaluating
current performance, FFO can facilitate comparisons of operating performance
between periods. The Company offers this measure to assist the users of its
financial statements in analyzing its performance; however, this is not a
measure of financial performance under GAAP and should not be considered a
measure of liquidity, an alternative to net income or an indicator of any other
performance measure determined in accordance with GAAP. Investors and
potential investors in the Company’s securities should not rely on non-GAAP
financial measures as a substitute for any GAAP measure, including net
income.
Adjusted
FFO is calculated as FFO available to common stockholders less non-cash
stock-based compensation, litigation settlements, nursing home revenues and
expenses, FIN 46 adjustments, and other non-recurring revenue and expense items
as more fully set forth in the reconciliation in the Company’s earnings release
included as Exhibit 99.1 to the Form 8-K furnished on February 6,
2009. The Company believes that adjusted FFO provides an enhanced
measure of the operating performance of the Company’s core portfolio as a
REIT. The Company's computation of adjusted FFO is not comparable to
the NAREIT definition of FFO or to similar measures reported by other
REITs.
SIGNATURES
Pursuant
to the requirements of the Securities Exchange Act of 1934, the registrant has
duly caused this report to be signed on its behalf by the undersigned hereunto
duly authorized.
OMEGA
HEALTHCARE INVESTORS, INC.
(Registrant)
Dated: February
10,
2009. By: /s/ C. Taylor
Pickett
C. Taylor Pickett
President and Chief Executive Officer