Diversicare and Omega Agree to the Terms of a New Master Lease
September 26 2017 - 8:30AM
Diversicare Healthcare Services, Inc. (NASDAQ:DVCR), a premier
provider of long-term care services, today entered into an
agreement with Omega Healthcare Investors (NYSE:OHI) on the terms
of a new master lease to lease the 35 centers currently owned by
Omega and operated by Diversicare to be effective October 1, 2018.
Diversicare’s current Master Lease with Omega
provides for its operation of 23 skilled nursing centers in Texas,
Kentucky, Alabama, Tennessee, Florida, and Ohio.
Additionally, Diversicare operates 12 centers owned by Omega under
separate leases in Missouri, Kentucky, Indiana, and Ohio. The
agreement entered into by Diversicare and Omega will consolidate
the leases for all 35 centers under one New Master Lease after the
expiration of its current Master Lease on September 30, 2018.
Key terms of the New Master Lease are as
follows:
- Common date of annual lease escalators consolidated to October
1st of each year beginning on October 1, 2019;
- Fixed annual base rent escalator of 2.15%;
- Provides for a landlord funded capital expenditure fund,
subject to annual rent impact;
- Initial lease term of 12 years with two 10 year extensions;
and
- Provides a mechanism for agreed upon divestitures of centers
through the life of the lease.
Commenting on the agreement, Kelly Gill, the
Company’s Chief Executive Officer, stated, “Diversicare and Omega
have enjoyed a long, successful relationship with one
another. We are appreciative of Omega’s cooperation
throughout this process and are glad to have this renewal completed
this far in advance of the effective date.”
About Diversicare Healthcare Services,
Inc.
As of September 26, 2017, Diversicare provides
long-term care services to patients in 77 skilled nursing and
senior housing centers containing 8,556 licensed beds. For
additional information about the Company, visit Diversicare's web
site: www.DVCR.com.
FORWARD-LOOKING STATEMENTS
The "forward-looking statements" contained in
this release are made pursuant to the safe harbor provisions of the
Private Securities Litigation Reform Act of 1995. Forward-looking
statements are predictive in nature and are frequently identified
by the use of terms such as "may," "will," "should," "expect,"
"believe," "estimate," "intend," and similar words indicating
possible future expectations, events or actions. These
forward-looking statements reflect our current views with respect
to future events and present our estimates and assumptions only as
of the date of this release. Actual results could differ materially
from those contemplated by the forward-looking statements made in
this release. In addition to any assumptions and other factors
referred to specifically in connection with such statements, other
factors, many of which are beyond our ability to control or
predict, could cause our actual results to differ materially from
the results expressed or implied in any forward-looking statements
including, but not limited to, our ability to successfully
integrate the operations of our new nursing centers in Alabama,
Mississippi, Kansas and Kentucky, as well as successfully operate
all of our centers, our ability to increase census at our renovated
centers, changes in governmental reimbursement, government
regulation, the impact of the recently adopted federal health care
reform or any future health care reform, any increases in the cost
of borrowing under our credit agreements, our ability to extend or
replace our current credit facility, our ability to comply with
covenants contained in those credit agreements, the outcome of
professional liability lawsuits and claims, our ability to control
ultimate professional liability costs, the accuracy of our estimate
of our anticipated professional liability expense, the impact of
future licensing surveys, the outcome of proceedings alleging
violations of state or Federal False Claims Acts, laws and
regulations governing quality of care or other laws and regulations
applicable to our business including HIPAA and laws governing
reimbursement from government payors, the costs of investing in our
business initiatives and development, our ability to control costs,
changes to our valuation of deferred tax assets, changes in
occupancy rates in our centers, changing economic and competitive
conditions, changes in anticipated revenue and cost growth, changes
in the anticipated results of operations, the effect of changes in
accounting policies as well as others. The Company has provided
additional information in its Annual Report on Form 10-K for the
fiscal year ended December 31, 2016, as well as in its other
filings with the Securities and Exchange Commission, which readers
are encouraged to review for further disclosure of other factors.
These assumptions may not materialize to the extent assumed, and
risks and uncertainties may cause actual results to be different
from anticipated results. These risks and uncertainties also may
result in changes to the Company's business plans and prospects.
Diversicare Healthcare Services, Inc. is not responsible for
updating the information contained in this press release beyond the
published date, or for changes made to this document by wire
services or Internet services.
Company Contact: |
|
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Investor
Relations: |
Kelly J. Gill |
|
|
James R. McKnight,
Jr. |
Chief Executive Officer
|
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Chief Financial
Officer |
615-771-7575 |
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615-771-7575 |
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