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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 13D
(AMENDMENT NO. 2)
UNDER THE SECURITIES EXCHANGE ACT OF 1934
REGENT ASSISTED LIVING, INC.
(Name of Issuer)
COMMON STOCK, NO PAR VALUE PER SHARE
(Title of Class of Securities)
758949-10-1
(CUSIP Number)
Pamela J. Privett, Esq.
Senior Vice President, General Counsel and Secretary
LTC Healthcare, Inc.
300 Esplanade Drive, Suite 1860
Oxnard, California 93030
(805) 981-3611
(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)
MAY 18, 1998
(Date of Event which Requires Filing of this Statement)
If the filing person has previously filed a statement on Schedule 13G to report
the acquisition which is subject of this Schedule 13D, and is filing this
statement because of Rule 13d-1(b)(3) or (4), check the following box: / /
(Continued on the following page)
Page 1 of 9 Pages
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SCHEDULE 13D
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CUSIP No. 758949-10-1 Page 2 of 9
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1 NAME OF REPORTING PERSON
LTC Healthcare, Inc.
Tax I.D. No. 91-1895305
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2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) / /
(b) / /
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3 SEC USE ONLY
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4 SOURCE OF FUNDS
WC, OO
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5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e) / /
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6 CITIZENSHIP OR PLACE OF ORGANIZATION
Nevada
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NUMBER OF 7 SOLE VOTING POWER
SHARES
BENEFICIALLY 866,666 shares
OWNED BY EACH -----------------------------------------------------
REPORTING 8 SHARED VOTING POWER
PERSON WITH
0
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9 SOLE DISPOSITIVE POWER
866,666 shares
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10 SHARED DISPOSITIVE POWER
0
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11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
866,666 shares
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12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES /X/
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13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
15.8%
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14 TYPE OF REPORTING PERSON
CO
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Page 3 of 9
Item 1. SECURITY AND ISSUER.
This statement relates to shares of common stock, no par value per
share (the "Common Stock"), of Regent Assisted Living, Inc., an Oregon
corporation (the "Company"). The principal executive offices of the Company are
located at 121 SW Morrison Street, Suite 1000, Portland, Oregon 97204.
Item 2. IDENTITY AND BACKGROUND.
(a) This statement is being filed by LTC Healthcare, Inc., a Nevada
corporation ("Healthcare").
(b) The address of Healthcare's principal offices is 300 Esplanade
Drive, Suite 1860, Oxnard, California 93030. The names, business addresses and
principal businesses of each of the directors and executive officers of
Healthcare are set forth on Schedule I hereto and incorporated by reference
herein.
(c) The current principal business of Healthcare, a holding company,
is its investment in the Notes (as defined below) and investments in other
securities.
(d) During the last five years, neither Healthcare nor, to the best
of its knowledge, any of the executive officers or directors of Healthcare, has
been convicted in a criminal proceeding (excluding traffic violations or similar
misdemeanors).
(e) During the last five years, neither Healthcare nor, to the best
of its knowledge, any of the executive officers or directors of Healthcare, has
been a party to a civil proceeding of a judicial or administrative body of
competent jurisdiction and, as a result of such proceeding, was or is subject to
a judgment, decree or final order enjoining future violations of, or prohibiting
or mandating activities subject to, federal or state securities laws or finding
any violation with respect to such laws.
(f) To the best knowledge of Healthcare, each of the executive
officers and directors of Healthcare is a United States citizen.
Item 3. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION.
The aggregate amount of funds paid in cash by Healthcare in making the
Note Purchase (as defined below) was $6,500,000, and Healthcare used its working
capital and proceeds from a loan (as described in Item 4 below) to make such
investment.
Item 4. PURPOSE OF TRANSACTION.
On March 26, 1998, Healthcare and the Company agreed that Healthcare
would invest $4,000,000 in the Company (the "Initial Note Purchase") in the form
of convertible subordinated debentures due 2008 (the "Initial Notes"). The
Initial Note Purchase was consummated on March 30, 1998 pursuant to the terms of
a Convertible Subordinated Note Purchase Agreement (the "Purchase Agreement"),
dated as of March 30, 1998, by and between the Company and Healthcare. On April
22, 1998, pursuant to the terms of the Purchase Agreement, Healthcare invested
an additional $1,000,000 (the "Second Note Purchase") in the form of convertible
subordinated debentures due 2008 (the "Secondary Notes"). On May 18, 1998,
pursuant to the terms of the Purchase Agreement, Healthcare
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Page 4 of 9
invested an additional $1,500,000 (the "Third Note Purchase," together with
the Initial Note Purchase and the Second Note Purchase, the "Note Purchase")
in the form of convertible subordinated debentures due 2008 (the "Third
Notes," together with the Initial Notes and the Secondary Notes, the
"Notes"). The Notes bear interest at 7.5% and are convertible, at any time
in whole or in part at Healthcare's option, into the Company's Common Stock
at a price of $7.50 per share, subject to adjustment, which if all Notes
issued to date to Healthcare were converted would result in the issuance of
866,666 shares of the Company's Common Stock. The Company can require
conversion of the Notes at such time as the Company's Common Stock trades at
$12 per share or more for thirty consecutive days.
The purpose of the Note Purchase was to provide the Company with
additional funds while providing Healthcare with an opportunity to invest in the
Company.
After giving effect to these transactions, and assuming conversion of
all Notes currently beneficially owned by Healthcare, Healthcare would be the
beneficial owner of 15.8% of the outstanding shares of the Company's Common
Stock. Healthcare also entered into a Registration Rights Agreement with the
Company pursuant to which Healthcare has, among other things, the right, under
certain circumstances and subject to certain conditions and exceptions, to
require the Company to register all or any portion of the shares of Common Stock
issued to it upon conversion of all or any portion of the Notes.
Pursuant to the Purchase Agreement, the Company has an option to
require Healthcare to purchase up to an additional $3,500,000 principal amount
of additional Notes. Such option must be exercised on or prior to March 31,
2000. The exercise price, and other terms and conditions of such additional
$3,500,000 principal amount of Notes are identical to the exercise price and
other terms and conditions of the $6,500,000 principal amount of Notes issued to
Healthcare to date. If the Company exercises its option to require Healthcare
to purchase all such additional Notes, and if all such additional Notes were
converted, an additional 866,666 shares of the Company's Common Stock would be
issued to Healthcare. Except for such obligation to purchase such additional
Notes, Healthcare currently has no other plan to further increase or decrease
the size of its investment in the Company.
Healthcare intends to review its investment in the Company from time
to time and, depending upon the price and availability of the Common Stock,
subsequent developments affecting the Company, the Company's business and
prospects, other investment and business opportunities available to Healthcare,
general stock market and economic conditions, tax considerations and other
factors deemed relevant, may decide to increase or decrease the size of its
investment in the Company.
Except as described herein, Healthcare has no present plan or proposal
which relates to, or could result in, any of the events referred to in
paragraphs (a) through (j), inclusive, of Item 4 of Schedule 13D. However,
Healthcare will continue to review the business of the Company and, depending
upon one or more of the factors referred to above, may in the future propose
that the Company take one or more of such actions.
Item 5. INTEREST IN SECURITIES OF THE ISSUER.
(a) Healthcare beneficially owns no shares of the Company's Common
Stock. Healthcare beneficially owns Notes convertible into 866,666 shares of
the Company's Common Stock. Immediately following the consummation of the
transactions contemplated by the Note Purchase and assuming conversion of all
Notes currently beneficially owned by Healthcare, Healthcare would be the
beneficial owner of 15.8% of the outstanding shares of the Company's Common
Stock.
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Page 5 of 9
(b) If Healthcare were to convert all of the Notes currently
outstanding, Healthcare would have sole power to vote or direct the vote of and
sole power to dispose or direct the disposition of 866,666 shares of the
Company's Common Stock. LTC Properties, Inc. ("LTC"), a Maryland corporation,
owns 4,002 non-voting shares of Healthcare's Class B common stock, par value
$.01 per share ("Class B Common Stock"), representing approximately 99% of the
outstanding capital stock of Healthcare. The four executive officers of
Healthcare are also executive officers of LTC. Two of such executive officers
are also directors of each of LTC and Healthcare. LTC contributed $2,001,000 to
Healthcare in connection with its equity investment in Healthcare. LTC also
provided Healthcare with an $8 million unsecured line of credit bearing interest
at 10% and maturing in 2008. Healthcare anticipates that any additional
purchases of Notes by Healthcare would be funded by a contribution of cash from
LTC to Healthcare in exchange for the issuance of additional shares of Class B
Common Stock to LTC or with borrowings under the $8 million unsecured line of
credit. LTC is the beneficial owner of 69,000 shares of the Company's Common
Stock, which represents 1.5% of the outstanding shares of the Company's Common
Stock. LTC disclaims beneficial ownership of the Common Stock beneficially
owned by Healthcare.
The principal business of LTC, a self-administered real estate
investment trust, is investing in long-term care and other health care-related
facilities through mortgage loans, facility lease transactions and other
investments.
LTC has provided the Company with approximately $54.6 million of
additional financing commitments for eight assisted living facilities (the "LTC
Commitment"), of which $8.4 million have been completed. To date, LTC and the
Company have completed $11.5 million of sale-leaseback transactions on two
assisted living facilities in addition to the eight which are subject to the LTC
Commitment.
(c) Except as described in Item 4 above, there have not been any
transactions in the Common Stock effected by or for the account of Healthcare or
any executive officer or director of Healthcare during the past 60 days.
(d) Except as stated in this Item 5, to the best knowledge of
Healthcare, no other person has the right to receive or the power to direct the
receipt of dividends from, or the proceeds from the sale of, the shares of
Common Stock issuable to Healthcare upon conversion of the Notes.
(e) Not applicable.
Item 6. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR
RELATIONSHIPS WITH RESPECT TO SECURITIES OF THE ISSUER.
See Items 4 and 5.
Item 7. MATERIAL TO BE FILED AS EXHIBITS.
*Exhibit 1. Convertible Subordinated Note Purchase Agreement, dated as
of March 30, 1998, by and between Regent Assisted Living, Inc.
and LTC Healthcare, Inc. (formerly known as LTC Equity Holding
Company, Inc.)
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Page 6 of 9
*Exhibit 2. Registration Rights Agreement, dated as of March 30, 1998,
by and between Regent Assisted Living, Inc. and LTC Healthcare,
Inc. (formerly known as LTC Equity Holding Company, Inc.)
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* Exhibits previously filed.
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SIGNATURE
After reasonable inquiry and to the best of my knowledge and belief,
the undersigned certify that the information set forth in this statement is
true, complete and correct.
Dated: May 28, 1998 LTC HEALTHCARE, INC.
By: /s/ Pamela J. Privett
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Name: Pamela J. Privett
Title: Senior Vice President,
General Counsel and Secretary
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Page 8 of 9
SCHEDULE I
DIRECTORS AND EXECUTIVE OFFICERS OF
LTC HEALTHCARE, INC.
The name, business address, present principal occupation or
employment, and the name, principal business and address of any corporation or
other organization in which such employment is conducted, of each of the
directors and executive officers of LTC Healthcare, Inc. is set forth below.
PRINCIPAL OCCUPATION, IF
OTHER THAN AS EXECUTIVE
NAME AND BUSINESS POSITION WITH LTC OFFICER OF LTC
ADDRESS HEALTHCARE, INC. HEALTHCARE, INC.
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Andre C. Dimitriadis Chairman of the Board Chairman of the Board and
300 Esplanade Drive, and Chief Executive Chief Executive Officer
Suite 1860 Officer of LTC Properties, Inc.
Oxnard, CA 93030
James J. Pieczynski President, Chief President, Chief
300 Esplanade Drive, Financial Officer, Financial Officer and
Suite 1860 Treasurer and Director of LTC
Oxnard, CA 93030i Director Properties, Inc.
Christopher T. Ishikawa Senior Vice Senior Vice President and
300 Esplanade Drive, President, Chief Chief Investment Officer
Suite 1860 Investment Officer, of LTC Properties, Inc.
Oxnard, CA 93030 Assistant Secretary
and Director
Pamela J. Privett Senior Vice Senior Vice President,
300 Esplanade Drive, President, General General Counsel and
Suite 1860 Counsel, Secretary Secretary of LTC
Oxnard, CA 93030 and Director Properties, Inc.
Joan M. Croker Director Attorney, Los Angeles
2240 Manning Avenue County Public Defender's
Los Angeles, CA 90064 Office
Lorri L. Jean Director Executive Director of Los
1316 N. Cherokee Avenue Angeles Gay and Lesbian
Los Angeles, CA 90028 Services Center
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Page 9 of 9
EXHIBIT INDEX
*Exhibit 1. Convertible Subordinated Note Purchase Agreement, dated as
of March 30, 1998, by and between Regent Assisted Living,
Inc. and LTC Healthcare, Inc. (formerly known as LTC Equity
Holding Company, Inc.)
*Exhibit 2. Registration Rights Agreement, dated as of March 30, 1998,
by and between Regent Assisted Living, Inc. and LTC
Healthcare, Inc. (formerly known as LTC Equity Holding
Company, Inc.)
_______________
* Exhibits previously filed.
