FIVE STAR QUALITY CARE,INC. (NASDAQ:FVE) Files An 8-K Entry into a Material Definitive Agreement
Item 1.01. Entry into a Material Definitive Agreement.
On February24, 2017, we entered into an amended and restated
credit agreement with Citibank, N.A., as administrative agent and
lender, and a syndicate of other lenders, or the credit
agreement, to which we continue to have a $100.0 million secured
revolving credit facility, or the credit facility, that is
available for general business purposes, including acquisitions.
The credit facility replaced our then existing secured revolving
credit facility, or the previous credit facility, which was
scheduled to expire in April2017. We had no borrowings
outstanding under the previous credit facility at the time we
entered into the credit agreement.
The maturity date of the credit facility is February24, 2020,
and, subject to our payment of extension fees and meeting other
conditions, includes options for us to extend the stated maturity
date of the credit facility for two, one year periods. Other
terms of the credit facility are substantially similar to those
of the previous credit facility, including that we are required
to pay interest at an annual rate of LIBOR plus a premium of 250
basis points on borrowings under the credit facility; that we are
also required to pay a quarterly commitment fee of 0.35% per
annum on the unused part of the credit facility; and that we may
draw, repay and redraw funds until maturity, and no principal
repayment is due until maturity.
We are the borrower under the credit facility, and certain of our
subsidiaries guarantee our obligations under the credit facility,
which is secured by real estate mortgages on 10 senior living
communities with a combined 1,219 living units owned by our
guarantor subsidiaries and our guarantor subsidiaries accounts
receivable and certain related collateral. The amount of
available borrowings under the credit facility is subject to our
having qualified collateral, which is primarily based on the
value of the properties securing our obligations under the credit
facility. Accordingly, the availability of borrowings under the
credit facility at any time may be less than $100 million.
The credit facility provides for acceleration of payment of all
amounts outstanding upon the occurrence and continuation of
certain events of default, including a change of control of us,
as defined. The credit agreement contains a number of financial
and other covenants, including covenants that restrict our
ability to incur indebtedness or to pay dividends or make other
distributions under certain circumstances and require us to
maintain certain financial ratios and a minimum net worth.
Citibank, N.A. and the other lenders party to the credit
agreement, as well as their affiliates, have engaged in, and may
in the future engage in, investment banking, commercial banking,
advisory and other dealings in the ordinary course of business
with us. They have received, and may in the future receive,
customary fees and commissions for these engagements.
The foregoing description of the credit agreement is not complete
and is subject to and qualified in its entirety by reference to
the credit agreement, a copy of which is attached hereto as
Exhibit10.1 and is incorporated herein by reference.
Item 2.03. Creation of a Direct Financial Obligation or
an Obligation under an Off-Balance Sheet Arrangement of a
Registrant.
The description of the credit agreement in Item 1.01 of this
Current Report on Form8-K is incorporated into this Item 2.03 by
reference.
Item 7.01. Regulation FD Disclosure.
On February27, 2017, we issued a press release regarding the
credit facility, a copy of which is attached hereto as
Exhibit99.1.
WARNING CONCERNING FORWARD LOOKING STATEMENTS
THIS CURRENT REPORT ON FORM8-K CONTAINS STATEMENTS THAT
CONSTITUTE FORWARD LOOKING STATEMENTS WITHIN THE MEANING OF THE
PRIVATE SECURITIES LITIGATION REFORMACT OF 1995 AND OTHER
SECURITIES LAWS. ALSO, WHENEVER WE USE WORDS SUCH AS BELIEVE,
EXPECT, ANTICIPATE, INTEND, PLAN, ESTIMATE, WILL, MAY AND
NEGATIVES OR DERIVATIVES OF THESE OR SIMILAR EXPRESSIONS, WE ARE
MAKING FORWARD LOOKING STATEMENTS. THESE FORWARD LOOKING
STATEMENTS ARE BASED UPON OUR PRESENT INTENT, BELIEFS OR
EXPECTATIONS, BUT FORWARD LOOKING STATEMENTS ARE NOT GUARANTEED
TO OCCUR AND MAYNOT OCCUR. ACTUAL RESULTS MAYDIFFER
MATERIALLY
FROM THOSE CONTAINED IN OR IMPLIED BY OUR FORWARD
LOOKING STATEMENTS AS A RESULT OF VARIOUS FACTORS. FOR
EXAMPLE:
OUR OPTIONS TO EXTEND THE MATURITY DATE OF THE CREDIT
FACILITY ARE SUBJECT TO OUR PAYMENT OF EXTENSION FEES AND
MEETING OTHER CONDITIONS, BUT THE APPLICABLE CONDITIONS MAYNOT
BE MET.
ACTUAL COSTS UNDER THE CREDIT FACILITY WILL BE HIGHER
THAN LIBOR PLUS A PREMIUM BECAUSE OF OTHER FEES AND EXPENSES
ASSOCIATED WITH THE CREDIT FACILITY.
THE AMOUNT OF AVAILABLE BORROWINGS UNDER THE CREDIT
FACILITY IS SUBJECT TO OUR HAVING QUALIFIED COLLATERAL, WHICH
IS PRIMARILY BASED ON THE VALUE OF THE ASSETS SECURING OUR
OBLIGATIONS UNDER THE CREDIT FACILITY. ACCORDINGLY, THE
AVAILABILITY OF BORROWINGS UNDER THE CREDIT FACILITY AT ANY
TIME MAYBE LESS THAN $100.0 MILLION. ALSO, THE AVAILABILITY OF
BORROWINGS UNDER THE CREDIT FACILITY IS SUBJECT TO OUR
SATISFYING CERTAIN FINANCIAL COVENANTS AND OTHER CUSTOMARY
CONDITIONS THAT WE MAYBE UNABLE TO SATISFY.
THE INFORMATION CONTAINED IN OUR FILINGS WITH THE
SECURITIES AND EXCHANGE COMMISSION, OR SEC,INCLUDING UNDER RISK
FACTORS IN OUR PERIODIC REPORTS, OR INCORPORATED
THEREIN,IDENTIFIES OTHER IMPORTANT FACTORS THAT COULD CAUSE OUR
ACTUAL RESULTS TO DIFFER MATERIALLY FROM THOSE STATED IN OR
IMPLIED BY OUR FORWARD LOOKING STATEMENTS. OUR FILINGS WITH THE
SEC ARE AVAILABLE ON THE SECS WEBSITE AT WWW.SEC.GOV.
YOU SHOULD NOT PLACE UNDUE RELIANCE UPON FORWARD
LOOKING STATEMENTS.
EXCEPT AS REQUIRED BY LAW, WE DO NOT INTEND TO UPDATE
OR CHANGE ANY FORWARD LOOKING STATEMENTS AS A RESULT OF NEW
INFORMATION, FUTURE EVENTS OR OTHERWISE.
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits.
|
10.1 |
Amended and Restated Credit Agreement, dated as of |
|
99.1 |
Press release dated February27, 2017. |
About FIVE STAR QUALITY CARE, INC. (NASDAQ:FVE)
Five Star Quality Care, Inc. operates senior living communities, including independent living communities, assisted living communities and skilled nursing facilities (SNFs). The Company operates through senior living community segment. In the senior living community segment, it operates for its own account or manages for the account of third parties independent living communities, assisted living communities and SNFs that are subject to centralized oversight and provide housing and services to elderly residents. It operates over 270 senior living communities with approximately 31,420 living units, including over 240 primarily independent and assisted living communities with approximately 28,610 living units and over 30 SNFs with approximately 2,800 living units. It owns and operates over 30 communities (approximately 3,210 living units), it leases and operates over 180 communities (approximately 20,010 living units) and manages over 60 communities (approximately 8,190 living units). FIVE STAR QUALITY CARE, INC. (NASDAQ:FVE) Recent Trading Information
FIVE STAR QUALITY CARE, INC. (NASDAQ:FVE) closed its last trading session 00.00 at 2.35 with 2,725,435 shares trading hands.