MEDICAL PROPERTIES TRUST, INC.
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): November 30, 2007
MEDICAL PROPERTIES TRUST, INC.
(Exact Name of Registrant as Specified in Charter)
Commission File Number 001-32559
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Maryland
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20-0191742 |
(State or other jurisdiction
of incorporation or organization)
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(I. R. S. Employer
Identification No.) |
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1000 Urban Center Drive, Suite 501 |
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Birmingham, AL
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35242 |
(Address of principal executive offices)
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(Zip Code) |
Registrants telephone number, including area code
(205) 969-3755
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:
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Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
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Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
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Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR
240.14d-2(b)) |
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Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR
240.13e-4(c)) |
Item 1.01. Entry into a Material Definitive Agreement.
On November 30, 2007, Medical Properties Trust, Inc., a Maryland corporation (the Company), and
MPT Operating Partnership, L.P., the Companys operating partnership (the Borrower), entered into
new credit facility in an aggregate amount of $220 million with a syndicate of lenders including
KeyBank National Association, as Syndication Agent, JPMorgan Chase Bank, N.A., as Administration
Agent, and the several lenders from time to time parties thereto. The information set forth below
with respect to the new credit facility under Item 2.03 of this Current Report on Form 8-K is
hereby incorporated in this Item 1.01 by reference.
Some of the lending banks under the new credit facility and their affiliates have in the past
provided and may from time to time in the future provide commercial banking, financial advisory,
investment banking and other services to the Company and the Borrower.
Item 1.02.
Termination of a Material Definitive Agreement.
As discussed in Item 1.01 above and Item 2.03 below, on November 30, 2007, the Company and the
Borrower entered into a new credit facility in an aggregate amount of $220 million with a syndicate
of lenders. Concurrently with the effectiveness of the new credit facility, the Borrower repaid in
full all outstanding obligations of the Borrower and its subsidiaries under its existing credit
agreement, dated October 27, 2005, among the Borrower, Merrill Lynch Capital, a division of Merrill
Lynch Business Financial Services Inc., as administrative agent and lender, and the several lenders
from time to time parties thereto, as amended. In connection with this repayment, the existing
credit agreement and related loan documents were terminated. No material termination fees or
penalties were incurred by the Company or the Borrower in connection with the termination of the
existing credit agreement, which was due to mature on October 26, 2009.
In addition, concurrently with the effectiveness of the new credit facility, the Borrower repaid in
full all outstanding obligations of the Borrower and its subsidiaries under that certain term loan
credit agreement, dated August 9, 2007, among the Company, the Borrower, KeyBank National
Association, as syndication agent, JPMorgan Chase Bank, N.A., as administration agent, and the
several lenders from time to time parties thereto, as amended by the First Amendment to Term Loan
Credit Agreement, dated as of November 7, 2007. No material termination fees or penalties were
incurred by the Company or the Borrower in connection with the termination of the secured term loan
agreement, which expired by its terms on November 30, 2007.
Item 2.03. Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet
Arrangement of a Registrant.
On November 30, 2007, the Company and
the Borrower entered into
a Revolving Credit and Term Loan Agreement with a syndicate of lenders including KeyBank National
Association, as Syndication Agent, JPMorgan Chase Bank, N.A., as Administration Agent, and the
several lenders from time to time parties thereto (the Credit Facility). The Credit Facility
provides for a $66 million term loan facility (the Term Facility), a $154 million revolving loan
facility (the Revolving Facility), a swingline loan facility of up to $25 million (the Swingline
Facility), and a letter of credit facility of up to $15 million (the Letter of Credit Facility).
Within 18 months of the closing date, the Borrower may request an increase in the Term Facility
and/or the Revolving Facility so as to increase the aggregate amount of the Credit Facility up to a
maximum of $350 million.
The maturity date of the Term Facility is November 8, 2011 and the maturity date of the Revolving
Facility is November 8, 2010. The maturity date of any loan made under the Swingline Facility is
the earlier of November 8, 2010 and the first date after such loan is made that is the
15th or last day of a calendar month, and the maturity date of any letter of credit
issued pursuant to the Letter of Credit Facility is the earlier of the first anniversary of the
issuance of such letter of credit and the date that is 5 days prior to November 8, 2010.
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On November 30, 2007, the Borrower drew down approximately
$66,000,000 under the Term Facility and $72,000,000 under the Revolving Facility. Proceeds were
used to (i) repay amounts outstanding on the existing credit agreement with Merrill Lynch
Capital, as described above in Item 1.02, (ii) to repay in full amounts outstanding under the term
loan credit agreement with JPMorgan Chase Bank, N.A. and KeyBank, National Association, as
described above in Item 1.02, and (iii) to pay fees and expenses.
At the Borrowers election, loans under the Term Facility will bear interest at a rate equal to
either (i) the highest of (x) the prime rate or (y) the federal funds effective rate from time to
time plus 0.5% (in either case, ABR Loans), plus a margin of 1.00%; or (ii) the rate at which
eurodollar deposits in the London interbank market for one, two or three months (as selected by the
Borrower) are quoted on the Telerate screen (Eurodollar Loans), plus a margin of 2.00%. If the
Borrowers total leverage ratio exceeds 55%, the applicable margins for ABR Loans and Eurodollar
Loans under the Term Facility will increase to 1.25% and 2.25%, respectively. At the Borrowers
election, loans under the Revolving Facility may also be made as either ABR Loans or Eurodollar
Loans. The applicable margin for ABR Loans under the Revolving Facility will initially be 0.75%
and is adjustable on a sliding scale from 0.50% to 1.25% based on current total leverage. The
applicable margin for Eurodollar Loans under the Revolving Facility will initially be 1.75% and is
adjustable on a sliding scale from 1.50% to 2.00% based on current
total leverage of less than 55%. In the event that the
Borrowers total leverage ratio is between 55% and 60%, the
applicable margin will be 2.25%; the Borrowers total leverage
ratio may not equal or exceed 55% for more than a limited period
during any fiscal year. Swingline loans
will bear interest at a rate equal to the highest of (x) the prime rate or (y) the federal funds
effective rate from time to time plus 0.5%, plus, in either case, a margin of 0.75%. Letters of
credit will bear interest at a rate equal to the applicable margin then in effect with respect to
Eurodollar Loans under the Revolving Facility
The Credit Facility contains provisions for mandatory prepayments from a portion of excess cash
flow and from the net cash proceeds of certain indebtedness incurred by the Company, asset sales
and debt issuances, subject to certain exceptions. The Borrower may also prepay the Credit
Facility at any time, subject to certain notice requirements. The Credit Facility is secured by a
pledge of (i) the equity interests of the Borrower and certain of its subsidiaries and (ii)
indebtedness in the form of mortgage notes payable to certain subsidiaries of the Borrower.
Borrowings under the Credit Facility are guaranteed by the Company and certain of the Borrowers
subsidiaries pursuant to a Guarantee and Collateral Agreement in favor of JPMorgan Chase Bank,
N.A., as Administrative Agent. As part of the transaction, the Company will pay the lenders a
quarterly commitment fee on the undrawn portion of the Credit Facility, ranging from 0.20% to 0.35%
per annum, based upon the amount of the undrawn portion of the Credit Facility. The Borrower will
also pay any lender issuing a letter of credit a fee of 0.125% per annum on the letter of credit
obligations.
The Credit Facility contains customary financial and operating covenants, including covenants
relating to total leverage ratio, fixed charge coverage ratio, mortgage secured leverage ratio,
recourse mortgage secured leverage ratio, consolidated adjusted net worth, floating rate debt,
facility leverage ratio, borrowing base interest coverage ratio, and covenants restricting the
incurrence of debt, imposition of liens, and entering into affiliate transactions. The Credit
Facility also contains customary events of default, including among others, nonpayment of principal
or interest, material inaccuracy of representations and failure to comply with our covenants. If
an event of default occurs and is continuing under the Revolving Credit and Term Loan Agreement,
the entire outstanding balance may become immediately due and payable.
The foregoing description of the Credit Facility is qualified in its entirety by the full terms and
conditions of the Credit Facility. A copy of the Credit Facility will be filed as an exhibit
with the Companys Annual Report on Form 10-K for the year ending December 31, 2007.
Item 7.01. Regulation FD Disclosure.
The Company issued a press release on December 3, 2007 announcing the completion of the new credit
facility. A copy of the press release is attached hereto as Exhibit 99.1 and by this reference
made a part hereof.
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The information contained in Item 7.01 of this Current Report, including Exhibit 99.1, is being
furnished and shall not be deemed filed for purposes of Section 18 of the Securities Exchange Act
of 1934, as amended, or otherwise subject to the liabilities of that Section. Such information
shall not be incorporated by reference into any filing of the Company, whether made before or after
the date hereof, regardless of any general incorporation language in such filing.
Item 9.01. Financial Statements and Exhibits.
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99.1 |
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Press release dated December 3, 2007 |
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SIGNATURE
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 thereunto duly authorized.
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MEDICAL PROPERTIES TRUST, INC.
(Registrant)
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By: |
/s/ R. Steven Hamner
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R. Steven Hamner |
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Executive Vice President and
Chief Financial Officer
(Principal Financial and
Accounting Officer) |
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Date: December 6, 2007
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EX-99.1 PRESS RELEASE DATED DECEMBER 3, 2007
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Exhibit 99.1 |
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Contact:
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Charles Lambert |
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Finance Director |
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Medical Properties Trust |
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(205) 397-8897 |
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clambert@medicalpropertiestrust.com |
MEDICAL PROPERTIES TRUST ANNOUNCES
CLOSING OF $220 MILLION CREDIT FACILITY
Birmingham, Ala., December 3, 2007 Medical Properties Trust, Inc. (NYSE:
MPW) announced today that it has entered into a new $220 million credit facility with a
syndicate of banks that replaces the Companys existing $150 million mortgage-secured
facility, which has an outstanding balance of approximately $35 million, and pays off a
$100 million bridge loan.
The new credit facility:
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provides the Company with additional financial flexibility and borrowing
capacity at a lower borrowing cost; |
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provides for revolving loans of up to $154 million at 150 to 200 basis points
over LIBOR, depending on the Companys overall level of debt for up to four years; |
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provides for a $66 million 4-year term loan, currently at 200 basis points
over LIBOR; |
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permits the Company to increase the facility to $350 million through an
accordion feature during the next 18 months; |
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is secured by equity interests in the Companys subsidiaries. |
Completing this facility in the face of the market turmoil of recent months is a
validation by some of Wall Streets leading banks of MPTs market leading position and
near term growth opportunities, said Edward K. Aldag, Jr., chairman, president and
CEO of Medical Properties Trust. Our acquisition pipeline is as robust as it has been
and our new credit facility assures that we will be able to take advantage of these
opportunities even during a period when capital is constrained for many companies.
As previously discussed, as a result of terminating the old credit facility, the
company expects to take a non-cash, one-time charge of approximately $2.7 million, or
$0.05 per share in the fourth quarter to write-off deferred financing costs.
The new credit facility contains customary financial and operating covenants, and
events of default. The joint lead arrangers and bookrunners for the new credit facility are
J.P. Morgan Securities Inc. and KeyBank National Association.
About Medical Properties Trust, Inc.
Medical Properties Trust, Inc. is a Birmingham, Alabama based self-advised real
estate investment trust formed to capitalize on the changing trends in healthcare delivery
by acquiring and developing net-leased healthcare facilities. These facilities include
inpatient rehabilitation hospitals, long-term acute care hospitals, regional acute care
hospitals, ambulatory surgery centers and other single-discipline healthcare facilities,
such as heart hospitals, orthopedic hospitals and cancer centers.
The statements in this press release that are forward looking are based on current
expectations and actual results or future events may differ materially. Words such as
expects, believes, anticipates, intends, will, should and variations of such
words and similar expressions are intended to identify such forward-looking statements,
which include statements including, but not limited to, the estimated non-cash charge in
the fourth quarter of 2007 related to deferred financing cost and the amount of future
investments. Such forward-looking statements involve known and unknown risks,
uncertainties and other factors that may cause the actual results of the Company or
future events to differ materially from those express in or underlying such forwardlooking
statements, including without limitation: national and economic, business, real
estate and other market conditions; the competitive environment in which the Company
operations; the execution of the Companys business plan; financing risks; the
Companys ability to attain and maintain its status as a REIT for federal income tax
purposes; acquisition and development risks; potential environmental and other
liabilities; and other factors affecting the real estate industry generally or the healthcare
real estate in particular. For further discussion of the facts that could affect outcomes,
please refer to the Risk Factors section of the Companys Form 10-K for the year
ended December 31, 2006 and the final prospectus for its initial public offering. Except
as otherwise required by the federal securities laws, the Company undertakes no
obligation to update the information in this press release.
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