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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) September 24, 1997
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NATIONWIDE HEALTH PROPERTIES, INC.
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(Exact name of registrant as specified in charter)
Maryland 1-9028 95-3997619
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(State or other (Commission file number) (IRS employer
jurisdiction of identification
incorporation) number)
610 Newport Center Drive, Suite 1150, Newport Beach, CA 92660-6429
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(Address of principal executive offices)
Registrant's telephone number, including area code:
(714) 718-4400
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Not Applicable
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(Former name or former address, if changed since last report)
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ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS
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1.1 Underwriting Agreement, dated September 24, 1997, among the
Registrant, Smith Barney Inc. and Morgan Stanley and Co. Incorporated.
3.1 Articles Supplementary to the Registrant's Amended and Restated
Articles of Incorporation, dated September 24, 1997.
4.1 Form of 7.677% Series A Cumulative Preferred Step-Up REIT Securities
Certificate.
8.1 Opinion of O'Melveny & Myers LLP regarding tax matters.
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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 thereunto duly authorized.
NATIONWIDE HEALTH PROPERTIES, INC.
Date: September 25, 1997 By: /s/ MARK L. DESMOND
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Name: Mark L. Desmond
Title: Senior Vice President and
Chief Financial Officer
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EXHIBIT 1.1
1,000,000 Shares
NATIONWIDE HEALTH PROPERTIES, INC.
7.677% Series A Cumulative Preferred Step-Up REIT Securities
(Par Value $1.00 per share)
(Liquidation Preference $100.00 per share)
UNDERWRITING AGREEMENT
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September 24, 1997
SMITH BARNEY INC.
MORGAN STANLEY & CO. INCORPORATED
c/o SMITH BARNEY INC.
388 Greenwich Street
New York, New York 10013
Dear Sirs:
Nationwide Health Properties, Inc., a Maryland corporation (the "Company"),
proposes to issue and sell an aggregate of 1,000,000 shares (the "Shares") of
its 7.677% Series A Cumulative Preferred Step-Up REIT Securities (par value
$1.00 per share) (liquidation preference $100.00 per share) ("StREITs(SM)"), to
Smith Barney Inc. and Morgan Stanley & Co. Incorporated (the "Underwriters").
The Company wishes to confirm as follows its agreement with each
Underwriter in connection with the purchase of the Shares by the several
Underwriters.
1. Registration Statement and Prospectus. The Company has prepared and
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filed with the Securities and Exchange Commission (the "Commission") in
accordance with the provisions of the Securities Act of 1933, as amended, and
the rules and regulations (the "Rules and Regulations") of the Commission
thereunder (collectively, the "Act"), a registration statement on Form S-3
(Registration No. 333-17061) under the Act (the "registration statement"),
including a prospectus for the registration of debt securities, depositary
shares, common stock, par value $0.10 per share ("Common Stock"), securities
warrants and preferred stock, par value $1.00 per share, including the Shares;
and such amendments to such registration statement as may have been required
prior to the date hereof have been filed with the Commission, and such
amendments have been similarly prepared. Such registration statement and any
post-effective amendments thereto have become effective under the Act. The
Company also has filed, or proposes to file, with the Commission pursuant to
Rule 424(b) under the Act, a prospectus supplement relating to the offering of
the Shares.
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The term "Registration Statement" as used in this Agreement means the
registration statement (including all financial schedules and exhibits), as
amended at the time it became effective, as supplemented or amended prior to the
execution of this Agreement. If it is contemplated, at the time this Agreement
is executed, that a post-effective amendment to the registration statement will
be filed and must be declared effective before the offering of the Shares may
commence, the term "Registration Statement" as used in this Agreement means the
registration statement as amended by said post-effective amendment. The term
"Prospectus" as used in this Agreement means the prospectus in the form included
in the Registration Statement at the time it was declared effective (the "Base
Prospectus") together with the prospectus supplement relating to the offering of
the Shares dated the date hereof in the form first filed with the Commission on
or after the date hereof (the "Prospectus Supplement"). Any reference in this
Agreement to the registration statement, the Registration Statement, the Base
Prospectus or the Prospectus shall be deemed to refer to and include the
documents incorporated by reference therein pursuant to Item 12 of Form S-3
under the Act, as of the date of the registration statement, the Registration
Statement or the Prospectus, as the case may be, and any reference to any
amendment or supplement to the registration statement, the Registration
Statement or the Prospectus shall be deemed to refer to and include any
documents filed after such date under the Securities Exchange Act of 1934, as
amended (the "Exchange Act") which, upon filing, are incorporated by reference
therein, as required by paragraph (b) of Item 12 of Form S-3. As used herein,
the term "Incorporated Documents" means the documents which at the time are
incorporated by reference in the registration statement, the Registration
Statement, the Prospectus, or any amendment or supplement thereto.
2. Agreements to Sell and Purchase. The Company hereby agrees, subject to
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all the terms and conditions set forth herein, to issue and sell to each
Underwriter and, upon the basis of the representations, warranties and
agreements of the Company herein contained and subject to all the terms and
conditions set forth herein, each Underwriter agrees severally and not jointly
to purchase from the Company, at a purchase price of $97.50 per Share (the
"purchase price per share"), the number of Shares set forth opposite the name of
such Underwriter in Schedule II hereto.
3. Terms of Public Offering. The Company has been advised by the
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Underwriters that they propose to make a public offering of the Shares as soon
after this Agreement has become effective as in their judgment is advisable and
initially to offer the Shares upon the terms set forth in the Prospectus.
4. Delivery of the Shares and Payment Therefor. Delivery to the
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Underwriters of and payment for the Shares shall be made at the office of Smith
Barney Inc., 388 Greenwich Street, New York, NY 10013, at 10:00 A.M., New York
City time, on September 29, 1997 (the "Closing Date"). The documents required
to be delivered by this Agreement shall be delivered at the office of O'Melveny
& Myers LLP, 610 Newport Center Drive, Suite 1700, Newport Beach, California
92660-6429 on the Closing Date. The place of closing for the Shares and the
Closing Date may be varied by agreement between Smith Barney Inc. and the
Company.
Certificates for the Shares to be purchased hereunder shall be registered
in such names and in such denominations as Smith Barney Inc., on behalf of the
Underwriters, shall request
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prior to 1:00 P.M., New York City time, on the second business day preceding the
Closing Date. Such certificates shall be made available to Smith Barney Inc. in
New York City for inspection and packaging not later than 9:30 A.M., New York
City time, on the business day next preceding the Closing Date. The
certificates evidencing the Shares to be purchased hereunder shall be delivered
to Smith Barney Inc., on behalf of the Underwriters, on the Closing Date against
payment of the purchase price therefor in immediately available funds.
5. Agreements of the Company. The Company agrees with each Underwriter as
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follows:
(a) If, at the time this Agreement is executed and delivered, it is
necessary for the Registration Statement or a post-effective amendment thereto
to be declared effective before the offering of the Shares may commence, the
Company will endeavor to cause the Registration Statement or such post-effective
amendment to become effective as soon as possible and will advise you promptly
and, if requested by you, will confirm such advice in writing, when the
Registration Statement or such post-effective amendment has become effective.
(b) The Company will advise you promptly and, if requested by you, will
confirm such advice in writing: (i) of any request by the Commission for
amendment of or a supplement to the Registration Statement or the Prospectus or
for additional information; (ii) of the issuance by the Commission of any stop
order suspending the effectiveness of the Registration Statement or of the
suspension of qualification of the Shares for offering or sale in any
jurisdiction or the initiation of any proceeding for such purpose; and (iii)
within the period of time referred to in the first sentence of paragraph (f)
below, of any change in the Company's condition, financial or other, business,
prospects, properties, net worth or results of operations, or of the happening
of any event, which makes any statement of a material fact made in the
Registration Statement or the Prospectus (as then amended or supplemented)
untrue or which requires the making of any additions to or changes in the
Registration Statement or the Prospectus (as then amended or supplemented) in
order to state a material fact required by the Act to be stated therein or
necessary in order to make the statements therein not misleading, or of the
necessity to amend or supplement the Prospectus (as then amended or
supplemented) to comply with the Act or any other law. If at any time the
Commission shall issue any stop order suspending the effectiveness of the
Registration Statement, the Company will use its reasonable efforts to obtain
the withdrawal of such order at the earliest possible time.
(c) The Company will furnish to you upon your request, without charge
(i) two signed copies of the registration statement as originally filed with the
Commission and of each amendment thereto, including financial statements and all
exhibits to the registration statement, (ii) such number of conformed copies of
the registration statement as originally filed and of each amendment thereto,
but without exhibits, as you may reasonably request, (iii) such number of copies
of the Incorporated Documents, without exhibits, as you may reasonably request,
and (iv) two copies of the exhibits to the Incorporated Documents.
(d) The Company will not file any amendment to the Registration
Statement or make any amendment or supplement to the Prospectus or, prior to the
end of the period of time referred to in the first sentence in paragraph
(f) below, file any document which, upon filing
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becomes an Incorporated Document, of which you shall not previously have been
advised or to which, after you shall have received a copy of the document
proposed to be filed, you shall reasonably object.
(e) The Company will use its best efforts to meet the requirements to
qualify as a "real estate investment trust" (a "REIT") under the Internal
Revenue Code of 1986, as amended (the "Code") unless the Company's Board of
Directors determines by resolution that it is in the best interests of the
Company's stockholders not to so qualify.
(f) As soon after the execution and delivery of this Agreement as
possible and thereafter from time to time for such period as in the opinion of
counsel for the Underwriters a prospectus is required by the Act to be delivered
in connection with sales by the Underwriters or any dealer, the Company will
promptly deliver to the Underwriters and each dealer, without charge, as many
copies of the Prospectus (and of any amendment or supplement thereto) as you may
reasonably request; provided, however, subsequent to the period ending nine
months after the date of this Agreement, the Company shall not be required to
pay the costs and expenses of the delivery of such requested copies of the
Prospectus (and of any amendment or supplement thereto). The Company consents to
the use of the Prospectus (and of any amendment or supplement thereto) in
accordance with the provisions of the Act and with the securities or Blue Sky
laws of the jurisdictions in the United States in which the Shares are offered
by the Underwriters and by all dealers to whom Shares may be sold, both in
connection with the offering and sale of the Shares and for such period of time
thereafter as the Prospectus is required by the Act to be delivered in
connection with sales by any Underwriter or dealer. If during such period of
time any event shall occur that in the judgment of the Company or in the opinion
of counsel for the Underwriters is required to be set forth in the Prospectus
(as then amended or supplemented) or should be set forth therein in order to
make the statements therein, in the light of the circumstances under which they
were made, not misleading, or if it is necessary to supplement or amend the
Prospectus (or to file under the Exchange Act any document which, upon filing,
becomes an Incorporated Document) in order to comply with the Act or any other
law, the Company will promptly prepare and, subject to the provisions of
paragraph (d) above, file with the Commission an appropriate supplement or
amendment thereto (or to such document), and will promptly furnish to the
Underwriters and any dealers a reasonable number of copies thereof. In the event
that the Company and you agree that the Prospectus should be amended or
supplemented, the Company, if reasonably requested by you, will promptly issue a
press release announcing or disclosing the matters to be covered by the proposed
amendment or supplement.
(g) The Company will cooperate with you and with counsel for the
Underwriters in connection with the registration or qualification of the Shares
for offering and sale by the Underwriters and by any dealers under the
securities or Blue Sky laws of such jurisdictions in the United States as you
may designate and will file such consents to service of process or other
documents necessary or appropriate in order to effect such registration or
qualification; provided that in no event shall the Company be obligated to
qualify to do business in any jurisdiction where it is not now so qualified or
to take any action which would subject it to service of process in suits, other
than those arising out of the offering or sale of the Shares, in any
jurisdiction where it is not now so subject.
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(h) The Company will make generally available to its security holders a
consolidated earnings statement, which need not be audited, covering a twelve-
month period commencing after the effective date of the Registration Statement
and ending not later than 15 months thereafter, as soon as practicable after the
end of such period, which consolidated earnings statement shall satisfy the
provisions of Section 11(a) of the Act.
(i) During the period of three years hereafter, the Company will
furnish to you (i) as soon as available, a copy of each report of the Company
mailed to stockholders or filed with the Commission, and (ii) from time to time
such other information concerning the Company as you may reasonably request.
(j) If this Agreement shall terminate or shall be terminated after
execution pursuant to any provisions hereof (otherwise than by notice given by
you terminating this Agreement pursuant to Section 10 or Section 11 hereof) or
if this Agreement shall be terminated by the Underwriters because of any failure
or refusal on the part of the Company to comply with the terms or fulfill any of
the conditions of this Agreement, the Company agrees to reimburse the
Underwriters for all reasonable out-of-pocket expenses (including reasonable
fees and expenses of counsel for the Underwriters) incurred by the Underwriters
in connection herewith, but the Company shall not in any event be liable to the
Underwriters for damages on account of loss of anticipated profits from the sale
by them of the Shares.
(k) The Company will apply the net proceeds from the sale of the Shares
substantially in accordance with the description set forth in the Prospectus
Supplement.
(l) The Company will (i) prepare and timely file with the Commission
under Rule 424(b) of the Act a Prospectus Supplement containing information
previously omitted at the time of effectiveness of the Registration Statement
and (ii) file on a timely basis all reports and any definitive proxy or
information statements required to be filed by the Company with the Commission
subsequent to the date of the Prospectus Supplement and prior to the termination
of the offering of the Shares.
6. Representations and Warranties of the Company. The Company represents
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and warrants to each Underwriter that:
(a) The Company and the transactions contemplated by this Agreement
meet the requirements for using Form S-3 under the Act. The registration
statement in the form in which it became or becomes effective and also in such
form as it may be when any post-effective amendment thereto shall become
effective and the Prospectus and any supplement or amendment thereto when filed
with the Commission under Rule 424(b) under the Act, complied or will comply in
all material respects with the provisions of the Act and will not at any such
times contain an untrue statement of a material fact or omit to state a material
fact required to be stated therein or necessary to make the statements therein
in light of the circumstances under which they were made not misleading, except
that this representation and warranty does not apply to statements in or
omissions from the registration statement or the prospectus made in reliance
upon and in conformity with information relating to any Underwriter furnished to
the Company in writing by or on behalf of any Underwriter through Smith Barney
Inc. expressly for use therein.
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(b) The Incorporated Documents, at the time they were filed with the
Commission, complied in all material respects with the requirements of the
Exchange Act and the rules and regulations thereunder, and, when read together
and with the other information in or incorporated by reference in the
Prospectus, did not contain any untrue statement of a material fact or omit to
state a material fact required to be stated therein or necessary in order to
make the statements therein, in the light of the circumstances under which they
were made, not misleading.
(c) The Company has an authorized capitalization as set forth in the
Prospectus. All of the issued shares of capital stock of the Company have been
duly authorized and validly issued and are fully paid and nonassessable. The
Shares have been duly authorized and, when issued and delivered to the
Underwriters against payment therefor in accordance with the terms hereof, will
be validly issued, fully paid and nonassessable, and will not be subject to any
preemptive or similar rights. The shares of capital stock of the Company,
including the StREITs(SM), conform to the description thereof in the
Registration Statement and the Prospectus.
(d) The Company has been duly incorporated and is validly existing as a
corporation in good standing under the laws of the State of Maryland with
corporate power and authority to own, lease and operate its properties and to
conduct its business as described in the Registration Statement and the
Prospectus; and the Company is duly qualified as a foreign corporation to
transact business and is in good standing in each jurisdiction in which such
qualification is required, whether by reason of the ownership or leasing of
property or the conduct of business, except where the failure to so qualify
would not have a material adverse effect on the business or financial condition
of the Company and its subsidiaries considered as one enterprise.
(e) Each subsidiary of the Company which is a significant subsidiary as
defined in Rule 405 of Regulation C under the Act (each a "Subsidiary" and
collectively the "Subsidiaries") is listed on Schedule I hereto and has been
duly incorporated and is validly existing as a corporation in good standing
under the laws of the jurisdiction of its incorporation, has corporate power and
authority to own, lease and operate its properties and conduct its business as
described in the Registration Statement and the Prospectus and is duly qualified
as a foreign corporation to transact business and is in good standing in each
jurisdiction in which such qualification is required, whether by reason of the
ownership or leasing of property or the conduct of business, except where the
failure to so qualify would not have a material adverse effect on the business
or financial condition of the Company and its subsidiaries considered as one
enterprise; and all of the issued and outstanding capital stock of each such
Subsidiary has been duly authorized and validly issued, is fully paid and non-
assessable and, except for directors' qualifying shares, is owned by the
Company, directly or through subsidiaries, free and clear of any security
interest, mortgage, pledge, lien, encumbrance, claim or equity.
(f) Except as set forth in the Registration Statement or the
Prospectus, there is no action, suit or proceeding before or by any court or
governmental agency or body, domestic or foreign, now pending, or, to the
knowledge of the Company, threatened, against the Company or any of its
subsidiaries which is required to be disclosed in the Registration Statement or
the Prospectus or which might in the opinion of the Company result in any
material adverse change
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in the business or financial condition of the Company and its subsidiaries
considered as one enterprise, or which might materially and adversely affect the
properties or assets thereof or which might materially and adversely affect the
consummation of this Agreement; all pending legal or governmental proceedings to
which the Company or any of its subsidiaries is a party or of which any of their
respective property or assets is the subject which are not described in the
Registration Statement or the Prospectus, including ordinary routine litigation
incidental to its business, are, considered in the aggregate, not material; and
there are no contracts or documents of the Company or any of its subsidiaries
which are required to be filed as exhibits to the Registration Statement or any
Incorporated Documents which have not been so filed.
(g) Neither the Company nor any of its subsidiaries is in default in
the performance or observance of any material obligation, agreement, covenant or
condition contained in any contract, indenture, mortgage, loan agreement, note,
lease or other instrument to which it is a party or by which it or any of them
may be bound, or to which any of their property or assets is subject, which
default would materially adversely affect the business or financial condition of
the Company and its subsidiaries considered as one enterprise; neither the
Company nor any of its subsidiaries is in violation of its charter or bylaws;
the execution, delivery and performance of this Agreement, and the consummation
of the transactions contemplated herein will not conflict with, or constitute a
breach of, or default under, or result in the creation or imposition of any
lien, charge or encumbrance upon any property or assets of the Company or any of
its subsidiaries pursuant to any material contract, indenture, mortgage, loan
agreement, note, lease or other instrument to which the Company or any of its
subsidiaries is a party or by which it or any of them may be bound, or to which
any of the property or assets of the Company or any such subsidiary is subject,
nor will such action result in any violation of the provisions of the charter or
bylaws of the Company or, to the best knowledge of the Company, any law,
administrative regulation or administrative or court order or decree; and no
consent, approval, authorization, order or decree of any court or governmental
agency or body is required for the consummation by the Company of the
transactions contemplated by this Agreement, except such as may be required
under the Act, the Exchange Act or the rules and regulations thereunder or as
may be required by state securities or Blue Sky laws.
(h) The accountants, Arthur Andersen LLP, who have certified or shall
certify the financial statements included or incorporated by reference in the
Registration Statement and the Prospectus (or any amendment or supplement
thereto) are independent public accountants as required by the Act.
(i) The financial statements and any supporting schedules of the
Company and its consolidated subsidiaries included or incorporated by reference
in the Registration Statement and the Prospectus present fairly the consolidated
financial position of the Company and its consolidated subsidiaries as of the
dates indicated and the consolidated results of their operations for the periods
specified; and, except as stated therein, said financial statements have been
prepared in conformity with generally accepted accounting principles in the
United States applied on a consistent basis; and any supporting schedules
included or incorporated by reference in the Registration Statement present
fairly the information required to be stated therein.
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(j) The Company has duly authorized, executed and delivered this
Agreement and this Agreement constitutes the valid and binding agreement of the
Company.
(k) Since the respective dates as of which information is given in the
Registration Statement and the Prospectus, except as otherwise stated therein,
(A) there has been no material adverse change in the condition, financial or
otherwise, or in the earnings, business affairs or business prospects of the
Company and its subsidiaries considered as one enterprise, whether or not
arising in the ordinary course of business and (B) there have been no material
transactions entered into by the Company or any of its subsidiaries, other than
those in the ordinary course of business.
(l) The Company and its subsidiaries have good title to all real
property or interests in real property owned by it or any of them, in each case
free and clear of all liens, encumbrances and defects except such as are
described in the Registration Statement or such as do not materially adversely
affect the value of such property and interests as reflected in the Company's
financial statements and do not materially interfere with the use made and
proposed to be made of such property and interests by the Company and its
subsidiaries; the instruments securing the Company's and its subsidiaries' real
estate mortgage loans create valid liens upon the real properties described in
such instruments enjoying the priorities intended, subject only to exceptions to
title which do not materially adversely affect the value of such real properties
and interests as reflected in the Company's financial statements; and no
material real property or buildings are held under lease by the Company or any
of its subsidiaries.
(m) The Company has not distributed and, prior to the later to occur of
(i) the Closing Date and (ii) completion of the distribution of the Shares, will
not distribute any offering material in connection with the offering and sale of
the Shares other than the Registration Statement, the Prospectus or other
materials, if any, permitted by the Act.
(n) The Company owns or possesses or has obtained all material
governmental licenses, permits, consents, orders, approvals and other
authorizations necessary to lease or own, as the case may be, and to operate
each property and to carry on its business as presently conducted where its
ownership or lease of any property or the conduct of its business requires such
ownership or possession or the obtaining of such governmental licenses, permits,
consents, orders, approvals and other authorizations and where the failure to do
so would materially adversely affect the business or financial condition of the
Company and its subsidiaries considered as one enterprise.
(o) The Company maintains a system of internal accounting controls
sufficient to provide reasonable assurances that (i) transactions are executed
in accordance with management's general or specific authorization; (ii)
transactions are recorded as necessary to permit preparation of financial
statements in conformity with generally accepted accounting principles and to
maintain accountability for assets; (iii) access to assets is permitted only in
accordance with management's general or specific authorization; and (iv) the
recorded accountability for assets is compared with existing assets at
reasonable intervals and appropriate action is taken with respect to any
differences.
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(p) No holder of any security of the Company has any right to require
registration of shares of Common Stock or any other security of the Company
because of the filing of the Registration Statement or consummation of the
transactions contemplated by this Agreement.
(q) The Company has at all times since December 31, 1985 operated in
such manner as to qualify as a REIT under the Code and intends to continue to
operate in such manner.
(r) The Company is not required to be registered under the Investment
Company Act of 1940, as amended (the "Investment Company Act").
(s) The StREITs(SM) are rated at least "baa3" by Moody's Investors
Service, Inc. and at least "BBB-" by Standard & Poor's Ratings Group.
7. Indemnification and Contribution.
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(a) The Company agrees to indemnify and hold harmless each of you and
each person, if any, who controls any Underwriter within the meaning of Section
15 of the Act or Section 20 of the Exchange Act from and against any and all
losses, claims, damages, liabilities and expenses (including reasonable costs of
investigation) arising out of or based upon any untrue statement or alleged
untrue statement of a material fact contained in the Registration Statement or
the Prospectus or in any amendment or supplement thereto, or arising out of or
based upon any omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements therein not
misleading, except insofar as such losses, claims, damages, liabilities or
expenses arise out of or are based upon any untrue statement or omission or
alleged untrue statement or omission which has been made therein or omitted
therefrom in reliance upon and in conformity with the information relating to
such Underwriter furnished in writing to the Company by or on behalf of any
Underwriter expressly for use in connection therewith. The foregoing indemnity
agreement shall be in addition to any liability which the Company may otherwise
have.
(b) If any action, suit or proceeding shall be brought against any
Underwriter or any person controlling any Underwriter in respect of which
indemnity may be sought against the Company, such Underwriter or such
controlling person shall promptly notify the Company and the Company shall
assume the defense thereof, including the employment of counsel and payment of
all reasonable fees and expenses. Such Underwriter or any such controlling
person shall have the right to employ separate counsel in any such action, suit
or proceeding and to participate in the defense thereof, but the fees and
expenses of such counsel shall be at the expense of such Underwriter or such
controlling person unless (i) the Company has agreed in writing to pay such fees
and expenses, (ii) the Company has failed to assume the defense and employ
counsel, or (iii) the named parties to any such action, suit or proceeding
(including any impleaded parties) include both such Underwriter or such
controlling person and the Company and such Underwriter or such controlling
person shall have been advised by its counsel that representation of such
indemnified party and the Company by the same counsel would be inappropriate
under applicable standards of professional conduct (whether or not such
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representation by the same counsel has been proposed) due to actual or potential
differing interests between them (in which case the Company shall not have the
right to assume the defense of such action, suit or proceeding on behalf of such
Underwriter or such controlling person). It is understood, however, that the
Company shall, in connection with any one such action, suit or proceeding or
separate but substantially similar or related actions, suits or proceedings in
the same jurisdiction arising out of the same general allegations or
circumstances, be liable for the reasonable fees and expenses of only one
separate firm of attorneys (in addition to any local counsel) at any time for
the Underwriters and controlling persons not having actual or potential
differing interests with you or among themselves, which firm shall be designated
in writing by Smith Barney Inc., and that all such reasonable fees and expenses
shall be reimbursed as they are incurred. The Company shall not be liable for
any settlement of any such action, suit or proceeding effected without its
written consent, but if settled with such written consent, or if there be a
final judgment for the plaintiff in any such action, suit or proceeding, the
Company agrees to indemnify and hold harmless each Underwriter, to the extent
provided in the preceding paragraph, and any such controlling person from and
against any loss, claim, damage, liability or expense by reason of such
settlement or judgment.
(c) Each Underwriter agrees, severally and not jointly, to indemnify
and hold harmless the Company, its directors, its officers who sign the
Registration Statement, and any person who controls the Company within the
meaning of Section 15 of the Act or Section 20 of the Exchange Act, to the same
extent as the foregoing indemnity from the Company to each Underwriter, but only
with respect to information relating to such Underwriter furnished in writing by
or on behalf of such Underwriter through you expressly for use in the
Registration Statement or the Prospectus or any amendment or supplement thereto.
If any action, suit or proceeding shall be brought against the Company, any of
its directors, any such officer, or any such controlling person based on the
Registration Statement or the Prospectus, or any amendment or supplement
thereto, and in respect of which indemnity may be sought against any Underwriter
pursuant to this paragraph (c), such Underwriter shall have the rights and
duties given to the Company by paragraph (b) above (except that if the Company
shall have assumed the defense thereof such Underwriter shall not be required to
do so, but may employ separate counsel therein and participate in the defense
thereof, but the fees and expenses of such counsel shall be at such
Underwriter's expense), and the Company, its directors, any such officer, and
any such controlling person shall have the rights and duties given to the
Underwriters by paragraph (b) above. The foregoing indemnity agreement shall be
in addition to any liability which the Underwriters may otherwise have.
(d) If the indemnification provided for in this Section 7 is
unavailable to an indemnified party under paragraphs (a) or (c) hereof in
respect of any losses, claims, damages, liabilities or expenses referred to
therein, then an indemnifying party, in lieu of indemnifying such indemnified
party, shall contribute to the amount paid or payable by such indemnified party
as a result of such losses, claims, damages, liabilities or expenses (i) in such
proportion as is appropriate to reflect the relative benefits received by the
Company on the one hand and the Underwriters on the other hand from the offering
of the Shares, or (ii) if the allocation provided by clause (i) above is not
permitted by applicable law, in such proportion as is appropriate to reflect not
only the relative benefits referred to in clause (i) above but also the relative
fault of the Company on the one hand and the Underwriters on the other in
connection with the
10
<PAGE>
statements or omissions that resulted in such losses, claims, damages,
liabilities or expenses, as well as any other relevant equitable considerations.
The relative benefits received by the Company on the one hand and any
Underwriters on the other shall be deemed to be in the same proportion as the
total net proceeds from the offering (before deducting expenses) received by the
Company bear to the total underwriting discounts and commissions received by the
Underwriters, in each case as set forth in the table on the cover page of the
Prospectus. The relative fault of the Company on the one hand and the
Underwriters on the other hand shall be determined by reference to, among other
things, whether the untrue or alleged untrue statement of a material fact or the
omission or alleged omission to state a material fact relates to information
supplied by the Company on the one hand or by the Underwriters on the other hand
and the parties' relative intent, knowledge, access to information and
opportunity to correct or prevent such statement or omission.
(e) The Company and the Underwriters agree that it would not be just and
equitable if contribution pursuant to this Section 7 were determined by a pro
rata allocation (even if the Underwriters were treated as one entity for such
purpose) or by any other method of allocation that does not take account of the
equitable considerations referred to in paragraph (d) above. The amount paid or
payable by an indemnified party as a result of the losses, claims, damages,
liabilities and expenses referred to in paragraph (d) above shall be deemed to
include, subject to the limitations set forth above, any legal or other expenses
reasonably incurred by such indemnified party in connection with investigating
any claim or defending any such action, suit or proceeding. Notwithstanding the
provisions of this Section 7, no Underwriter shall be required to contribute any
amount in excess of the amount by which the total price of the Shares
underwritten by it and distributed to the public exceeds the amount of any
damages which such Underwriter has otherwise been required to pay by reason of
such untrue or alleged untrue statement or omission or alleged omission. No
person guilty of fraudulent misrepresentation (within the meaning of Section
11(f) of the Act) shall be entitled to contribution from any person who was not
guilty of such fraudulent misrepresentation. The Underwriters' obligation to
contribute pursuant to this Section 7 are several in proportion to the
respective number of StREITs(SM) set forth opposite their names in Schedule II
hereto and not joint.
(f) No indemnifying party shall, without the prior written consent of the
indemnified party, effect any settlement of any pending or threatened action,
suit or proceeding in respect of which any indemnified party is a party and
indemnity could have been sought hereunder by such indemnified party, unless
such settlement includes an unconditional release of such indemnified party from
all liability on claims that are the subject matter of such action, suit or
proceeding.
(g) Any losses, claims, damages, liabilities or expenses for which an
indemnified party is entitled to indemnification or contribution under this
Section 7 shall be paid by the indemnifying party to the indemnified party as
such losses, claims, damages, liabilities or expenses are incurred. The
indemnity and contribution agreements contained in this Section 7 and the
representations and warranties of the Company set forth in this Agreement shall
remain operative and in full force and effect, regardless of (i) any
investigation made by or on behalf of any Underwriter or any person controlling
any Underwriter, the Company, its directors or officers, or any person
controlling the Company, (ii) acceptance of any Shares and payment
11
<PAGE>
therefor hereunder, and (iii) any termination of this Agreement. A successor to
any Underwriter or any person controlling any Underwriter, or to the Company,
its directors or officers, or any person controlling the Company, shall be
entitled to the benefits of the indemnity, contribution and reimbursement
agreements contained in this Section 7.
8. Conditions of Underwriter's Obligations. The several obligations of
---------------------------------------
the Underwriters to purchase the Shares hereunder are subject to the following
conditions:
(a) If, at the time this Agreement is executed and delivered, it is
necessary for a post-effective amendment to the registration statement to be
declared effective before the offering of the Shares may commence, such post-
effective amendment shall have become effective not later than 5:30 P.M., New
York City time, on the date hereof, or at such later date and time as shall be
consented to in writing by you, and all filings, if any, required by Rules 424
and 430A under the Act shall have been timely made; no stop order suspending the
effectiveness of the registration statement shall have been issued and no
proceeding for that purpose shall have been instituted or, to the knowledge of
the Company or the Underwriters, threatened by the Commission, and any request
of the Commission for additional information (to be included in the registration
statement or the prospectus or otherwise) shall have been complied with.
(b) Subsequent to the effective date of this Agreement, there shall not
have occurred any event or development relating to or involving the Company or
any officer or director of the Company which makes any statement made in the
Prospectus untrue in any material respect or which, in the opinion of the
Company and its counsel or the Underwriters and their counsel, requires the
making of any addition to or change in the Prospectus in order to state a
material fact required by the Act or any other law to be stated therein or
necessary in order to make the statements therein not misleading, if amending or
supplementing the Prospectus to reflect such event or development would, in your
opinion, have a material adverse effect on the market for the Shares.
(c) You shall have received on the Closing Date, an opinion of O'Melveny &
Myers LLP, counsel for the Company, dated the Closing Date and addressed to you
substantially in the form of Annex A hereto.
(d) You shall have received on the Closing Date, an opinion of Brown & Wood
LLP, counsel for the Underwriter, dated the Closing Date and addressed to you
with respect to the matters referred to in clauses (v), (vi) (with respect to
the third sentence only), (xiii), (ix) and (xviii) (excluding Incorporated
Documents) of Annex A hereto and such other related matters as you may request.
(e) You shall have received letters addressed to you and dated the Closing
Date from Arthur Andersen LLP, independent certified public accountants,
substantially in the form heretofore approved by you.
(f) (i) No stop order suspending the effectiveness of the Registration
Statement shall have been issued and no proceedings for that purpose shall have
been taken or, to the knowledge of the Company, shall be contemplated by the
Commission at or prior to the Closing
12
<PAGE>
Date; (ii) there shall not have been any change in the capital stock of the
Company nor any material increase in the short-term or long-term debt of the
Company (other than in the ordinary course of business) from that set forth or
contemplated in the Registration Statement or the Prospectus (or any amendment
or supplement thereto); (iii) there shall not have been, since the respective
dates as of which information is given in the Registration Statement and the
Prospectus (or any amendment or supplement thereto), except as may otherwise be
stated in the Registration Statement and Prospectus (or any amendment or
supplement thereto), any material adverse change in the condition, financial or
other, business, prospects, properties, net worth or results of operations of
the Company and the Subsidiaries taken as a whole; (iv) the Company and the
Subsidiaries shall not have any liabilities or obligations, direct or contingent
(whether or not in the ordinary course of business), that are material to the
Company and the Subsidiaries, taken as a whole, other than those reflected or
incorporated by reference in the Registration Statement or the Prospectus (or
any amendment or supplement thereto); and (v) all the representations and
warranties of the Company contained in this Agreement shall be true and correct
on and as of the date hereof and on and as of the Closing Date as if made on and
as of the Closing Date, and you shall have received a certificate, dated the
Closing Date and signed on behalf of the Company by the President or Vice
President and the chief financial officer of the Company (or such other officers
as are acceptable to you), to the effect set forth in this Section 8(f) and in
Section 8(g) hereof.
(g) The Company shall not have failed at or prior to the Closing Date to
have performed or complied with any of its agreements herein contained and
required to be performed or complied with by it hereunder at or prior to the
Closing Date.
(h) The Company shall have furnished or caused to be furnished to you such
further certificates and documents as you shall have requested.
(i) There shall not have been any announcement by any "nationally
recognized statistical rating organization," as defined for purposes of Rule
436(g) under the Act, that (i) it is downgrading its rating assigned to any
securities of the Company, or (ii) it is reviewing its rating assigned to any
securities of the Company with a view to possible downgrading, or with negative
implications, or direction not determined.
All such opinions, certificates, letters and other documents will be in
compliance with the provisions hereof only if they are satisfactory in form and
substance to you and your counsel.
Any certificate or document signed by any officer of the Company and
delivered to you or to your counsel shall be deemed a representation and
warranty by the Company to each Underwriter as to the statements made therein.
9. Expenses. The Company agrees to pay the following costs and expenses
--------
and all other costs and expenses incident to the performance by it of its
obligations hereunder: (i) the preparation, printing or reproduction, and
filing with the Commission of the Registration Statement (including financial
statements and exhibits thereto), the Prospectus, the Prospectus Supplement and
each amendment or supplement to any of them; (ii) the printing (or reproduction)
13
<PAGE>
and delivery (including postage, air freight charges and charges for counting
and packaging) of such copies of the Registration Statement, the Prospectus, the
Incorporated Documents, and all amendments or supplements to any of them, as may
be reasonably requested for use in connection with the offering and sale of the
Shares; (iii) the preparation, printing, authentication, issuance and delivery
of certificates for the Shares, including any stamp taxes in connection with the
original issuance and sale of the Shares; (iv) the printing (or reproduction)
and delivery of this Agreement, the Blue Sky Memorandum and all other agreements
or documents printed (or reproduced) and delivered in connection with the
offering of the Shares; (v) the registration of the Shares under the Exchange
Act if required by the Exchange Act; (vi) the registration or qualification of
the Shares for offer and sale under the securities or Blue Sky laws of the
several states as provided in Section 5(g) hereof (including the reasonable
fees, expenses and disbursements of counsel for the Underwriters relating to the
preparation, printing or reproduction, and delivery of the Blue Sky Memorandum
and such registration and qualification); (vii) the filing fees in connection
with any filings required to be made with the National Association of Securities
Dealers, Inc.; (viii) the transportation and other expenses incurred by or on
behalf of Company representatives in connection with presentations to
prospective purchasers of the Shares; (ix) the fees and expenses associated with
obtaining ratings for the Shares from nationally recognized statistical rating
organizations; and (x) the fees and expenses of the Company's accountants and
the fees and expenses of counsel (including local and special counsel) for the
Company.
10. Effective Date of Agreement. This Agreement shall become effective:
---------------------------
(i) upon the execution and delivery hereof by the parties hereto; or (ii) if, at
the time this Agreement is executed and delivered, it is necessary for a post-
effective amendment to the Registration Statement to be declared effective
before the offering of the Shares may commence, when notification of the
effectiveness of such post-effective amendment has been released by the
Commission. Until such time as this Agreement shall have become effective, it
may be terminated by the Company, by notifying you, or by you by notifying the
Company.
11. Termination of Agreement. This Agreement shall be subject to
------------------------
termination in your absolute discretion, without liability on the part of any
Underwriter to the Company by notice to the Company, if prior to the Closing
Date: (i) trading in securities generally on the New York Stock Exchange, the
American Stock Exchange or the Nasdaq National Market shall have been suspended
or materially limited, (ii) a general moratorium on commercial banking
activities in the State of New York or the State of California shall have been
declared by either federal or state authorities, or (iii) there shall have
occurred any outbreak or escalation of hostilities or other international or
domestic calamity or crisis, the effect of which on the financial markets of the
United States is such as to make it, in your judgment, impracticable or
inadvisable to commence or continue the offering of the Shares at the offering
price to the public set forth on the cover page of the Prospectus or to enforce
contracts for the resale of the Shares by the Underwriter. Notice of such
termination may be given to the Company by telegram, telecopy or telephone and
shall be subsequently confirmed by letter.
12. Information Furnished by the Underwriters. The statements set forth
-----------------------------------------
in the last paragraph on the cover page, the stabilization legend on the inside
front cover, and the statements in the second and fourth paragraphs under the
caption "Underwriting" in the Prospectus Supplement,
14
<PAGE>
constitute the only information furnished by or on behalf of the Underwriters as
such information is referred to in Sections 6(a) and 7 hereof.
13. Miscellaneous. Except as otherwise provided in Sections 5, 10 and 11
-------------
hereof, notice given pursuant to any provision of this Agreement shall be in
writing and shall be delivered (i) if to the Company, at the office of the
Company at 610 Newport Center Drive, Suite 1150, Newport Beach, California
92660, Attention: President; or (ii) if to the Underwriters, care of Smith
Barney Inc., 388 Greenwich Street, New York, New York 10013, Attention: Manager,
Investment Banking Division.
This Agreement has been and is made solely for the benefit of the several
Underwriters, the Company, its directors and officers, and the other controlling
persons referred to in Section 7 hereof and their respective successors and
assigns, to the extent provided herein, and no other person shall acquire or
have any right under or by virtue of this Agreement. Neither the term
"successor" nor the term "successors and assigns" as used in this Agreement
shall include a purchaser from any Underwriter of any of the Shares in his
status as such purchaser.
14. Applicable Law; Counterparts. This Agreement shall be governed by and
----------------------------
construed in accordance with the laws of the State of California applicable to
contracts made and to be performed within the State of California.
This Agreement may be signed in various counterparts which together
constitute one and the same instrument. If signed in counterparts, this
Agreement shall not become effective unless at least one counterpart hereof
shall have been executed and delivered on behalf of each party hereto.
15
<PAGE>
Please confirm that the foregoing correctly sets forth the agreement
between the Company and the several Underwriters.
Very truly yours,
NATIONWIDE HEALTH PROPERTIES, INC.
/s/ R. BRUCE ANDREWS
By:_______________________________
Name: R. Bruce Andrews
Title: President and
Chief Executive Officer
Confirmed as of the date first above mentioned.
SMITH BARNEY INC.
MORGAN STANLEY & CO. INCORPORATED
By: SMITH BARNEY INC.
/s/ DAVID GATELY
By:_______________________________________
Managing Director
16
<PAGE>
SCHEDULE I
----------
Significant Subsidiaries of the Company
---------------------------------------
(as such term is defined in Rule 405 of Regulation C under the Act)
-------------------------------------------------------------------
National Health Properties Finance Corporation,
a Delaware corporation
<PAGE>
SCHEDULE II
-----------
NATIONWIDE HEALTH PROPERTIES, INC.
<TABLE>
<CAPTION>
Number of
Underwriter StREITs(SM)
----------- -----------
<S> <C>
Smith Barney Inc............................................. 500,000
Morgan Stanley & Co. Incorporated............................ 500,000
---------
Total................................................... 1,000,000
=========
</TABLE>
<PAGE>
ANNEX A
-------
Opinion of O'Melveny & Myers L.L.P.
-----------------------------------
(i) The Company has been duly incorporated and is validly existing in good
standing under the laws of the State of Maryland.
(ii) The Company has corporate power to own its properties and assets and
to carry on its business as described in the Registration Statement and the
Prospectus.
(iii) To the best of such counsel's knowledge, the Company is duly
qualified as a foreign corporation to transact business and is in good standing
in each jurisdiction in which such qualification is required, whether by reason
of the ownership or leasing of property or the conduct of business, except where
the failure to so qualify would not have a material adverse effect on the
condition, financial or otherwise, or the earnings, business affairs or business
prospects of the Company and its subsidiaries considered as one enterprise.
(iv) Nationwide Health Properties Finance Corporation, a Delaware
corporation, has been duly incorporated and is validly existing in good standing
under the laws of the jurisdiction of its incorporation with corporate power to
conduct its business as currently conducted and is duly qualified as a foreign
corporation to transact business and is in good standing in each jurisdiction in
which such qualification is required, whether by reason of the ownership or
leasing of property or the conduct of business, except where the failure to so
qualify would not have a material adverse effect on the condition, financial or
otherwise, or the earnings, business affairs or business prospects of the
Company and its subsidiaries considered as one enterprise; and all of the issued
and outstanding capital stock of Nationwide Health Properties Finance
Corporation has been duly authorized and validly issued, is fully paid and non-
assessable and, except for directors' qualifying shares, is owned by the
Company, directly or through subsidiaries, free and clear of any security
interest, mortgage, pledge, lien, encumbrance, claim or equity.
(v) The execution, delivery and performance of this Agreement has been duly
authorized by all necessary corporate action on the part of the Company, and has
been duly executed and delivered by the Company.
(vi) The Company has an authorized capitalization as set forth in the
Prospectus. All of the issued shares of capital stock of the Company have been
duly authorized and validly issued and are fully paid and nonassessable. The
Shares have been duly authorized and, when issued and delivered to the
Underwriters against payment therefor in accordance with the terms of this
Agreement, will be validly issued, fully paid and nonassessable, and will not be
subject to any preemptive or similar rights. The StREITs/SM/ conform in all
material respects to the description thereof contained in the Registration
Statement and the Prospectus.
(vii) The form of certificates for the Shares conform to the requirements
of the Maryland General Corporation Law.
i
<PAGE>
(viii) The Registration Statement has been declared effective under the
Act and, to the best of such counsel's knowledge, no stop order suspending the
effectiveness of the Registration Statement has been issued or threatened by the
Commission; and any required filing of the Prospectus pursuant to Rule 424(b)
has been made in accordance with Rule 424(b).
(ix) The Registration Statement, on the date it became effective, appeared
on its face to comply in all material respects with the requirements as to form
for registration statements on Form S-3 under the Act and the related rules and
regulations in effect at the date of effectiveness, except no opinion need be
expressed concerning the financial statements and other financial information
contained or incorporated by reference therein or any Statement of Eligibility
of any trustee on Form T-1 filed as an exhibit thereto.
(x) Each of the Incorporated Documents (other than the financial statements
and other financial data included or incorporated by reference therein, as to
which no opinion need be rendered) on the respective dates they were filed,
appeared on their face to comply in all material respects with the Exchange Act
and the rules and regulations thereunder in effect at the respective dates of
their filing.
(xi) The statements in the Prospectus under the captions "Description of
StREITs(SM)", "Description of Preferred Stock" and "Certain Federal Income Tax
Considerations", to the extent that they constitute matters of law, summaries of
legal matters or documents, or legal conclusions, have been reviewed by such
counsel and are correct in all material respects.
(xii) No order, authorization, consent, permit or approval of any
governmental authority is required on the part of the Company for the
consummation of the transactions contemplated by this Agreement, except such as
may be required under the Act or the Exchange Act or state securities or Blue
Sky laws.
(xiii) The Company is not an "investment company" within the meaning of
the Investment Company Act.
(xiv) To the best of such counsel's knowledge, there are no legal or
governmental proceedings pending or threatened which are required to be
disclosed in the Registration Statement or the Prospectus, other than those
disclosed therein.
(xv) To the best of such counsel's knowledge, except as otherwise stated or
incorporated by reference in the Prospectus, the Company's execution and
delivery of and performance of its obligations under this Agreement do not (A)
conflict with or constitute a breach of, or default under, or result in the
creation or imposition of any lien, charge or encumbrance upon any property or
assets of the Company or any of its subsidiaries pursuant to any agreement,
indenture, lease or other instrument to which the Company or any of its
subsidiaries is a party or which the Company or any subsidiary may be bound, (B)
result in any violation of the provisions of the charter or bylaws of the
Company or (C) result in any violation of any applicable law, administrative
regulation or administrative or court decree the effect of which would be
material to the Company and its subsidiaries taken as a whole.
ii
<PAGE>
(xvi) Such counsel does not know of any contract or other document
required to be described or referred to in the Registration Statement or the
Prospectus or to be filed or incorporated by reference as an exhibit to the
Registration Statement or any Incorporated Document that are not described or
referred to or filed or incorporated by reference as an exhibit thereto.
(xvii) Based upon current law, including relevant statutes, regulations
and judicial and administrative precedent (which is subject to change on a
retroactive basis), and subject to all of the limitations, qualifications,
conditions and factual assumptions set forth herein, the Company has qualified
as a REIT under the Code, for each taxable year commencing with its taxable year
ended December 31, 1993, and the organization and method of operation of the
Company and each of its subsidiaries will enable the Company to continue to meet
the requirements for qualification and taxation as a REIT for its taxable year
ending December 31, 1997 and each taxable year thereafter. However, such counsel
may state that they are unable to opine whether the Company will actually
continue to qualify as a REIT because such qualification will depend on future
transactions and events that cannot be known at the date of such opinion.
(xviii) In connection with such counsel's participation in the preparation
of the Registration Statement and the Prospectus, such counsel has not
independently verified the accuracy, completeness or fairness of the statements
contained or incorporated therein, and the limitations inherent in the
examination made by such counsel and the knowledge available to such counsel are
such that such counsel is unable to assume, and does not assume, any
responsibility for such accuracy, completeness or fairness. However, on the
basis of such counsel's review and participation in conferences in connection
with the preparation of the Registration Statement and the Prospectus, and
relying as to materiality to a large extent upon opinions of officers and other
representatives of the Company, such counsel does not believe that the
Registration Statement as of its effective date contained any untrue statement
of a material fact or omitted to state a material fact required to be stated
therein or necessary to make the statements therein not misleading, and such
counsel does not believe that the Prospectus and the Incorporated Documents,
considered as a whole on the date hereof, contain any untrue statement of a
material fact or omit to state a material fact required to be stated therein or
necessary to make the statements therein, in light of the circumstances under
which they were made, not misleading. However, such counsel expresses no
opinion or belief as to any document filed by the Company under the Exchange
Act, whether before or after the effective date of the Registration Statement,
except to the extent that any such document is an Incorporated Document read
together with the Registration Statement or the Prospectus and considered as a
whole, nor does such counsel express any opinion or belief as to the exhibits,
financial statements and other financial and statistical information contained
or incorporated by reference in the Registration Statement, the Prospectus or
the Incorporated Documents.
iii
<PAGE>
EXHIBIT 3.1
NATIONWIDE HEALTH PROPERTIES, INC.
Articles Supplementary
NATIONWIDE HEALTH PROPERTIES, INC., a Maryland corporation, having its
principal Maryland office in Baltimore, Maryland (the "Corporation"), hereby
certifies to the Maryland State Department of Assessments and Taxation that:
FIRST: Pursuant to authority expressly vested in the Board of Directors of
the Corporation by the Amended and Restated Articles of Incorporation of the
Corporation (the "Articles"), the Board of Directors has duly classified
1,000,000 shares of the Preferred Stock (par value $1.00 per share) of the
Corporation as 7.677% Series A Cumulative Preferred Step-Up REIT Securities (par
value $1.00 per share) of the Corporation (the "StREITs(SM") and has provided
for the issuance of such shares.
SECOND: The StREITs(SM) classified hereby shall have the following
preferences, conversion and other rights, voting powers, restrictions,
limitations as to dividends, qualifications and terms and conditions of
redemption and shall be subject to all provisions of the Articles relating to
the stock of the Corporation generally:
1. Designation and Amount.
The designation of StREITs(SM) described in Article FIRST hereof shall
be "7.677% Series A Cumulative Preferred Step-Up REIT Securities (par value
$1.00 per share)." The number of shares of StREITs(SM) to be authorized shall
be 1,000,000.
2. Dividends and Distribution Provisions.
(a) Subject to the rights of series of Preferred Stock which may from
time to time come into existence, holders of StREITs(SM) shall be entitled to
receive, when and as declared by the Board of Directors, out of funds legally
available for the payment of dividends, cumulative preferential cash dividends
at the rate of 7.677% of the liquidation preference per annum (equivalent to
$7.677 per share per annum) through September 30, 2012 and at the rate of 9.677%
of the liquidation preference per annum (equivalent to $9.677 per share per
annum) thereafter. Such dividends shall be cumulative from the date of original
issue and shall be payable quarterly in arrears on the last day of March, June,
September and December or, if not a business day, the next succeeding business
day (each, a "Dividend Payment Date"). The first dividend will be due on
December 31, 1997. Such first dividend and any dividend distribution payable on
the StREITs(SM) for any partial distribution period will be computed on the
basis of a 360-day year consisting of twelve 30-day months. Dividends will be
payable to holders of record as they appear in
<PAGE>
the records of the Corporation at the close of business on the applicable record
date, which shall be on such date designated by the Board of Directors of the
Corporation for the payment of dividends that is not more than 30 nor less than
10 days prior to such Dividend Payment Date (each, a "Dividend Record Date").
(b) Dividends on the StREITs(SM) will accrue whether or not the
Corporation has earnings, whether or not there are funds legally available for
the payment of such dividends and whether or not such dividends are declared.
No interest, or sum of money in lieu of interest, shall be payable in respect of
any dividend payment or payments on the StREITs(SM) which may be in arrears.
Holders of the StREITs(SM) will not be entitled to any dividends in excess of
the full cumulative dividends as described above.
(c) If, for any taxable year, the Company elects to designate as
"capital gain dividends" (as defined in Section 857 of the Internal Revenue Code
of 1986, as amended (the "Code")) any portion (the "Capital Gains Amount") of
the dividends (within the meaning of the Code) paid or made available for the
year to holders of all classes of shares of capital stock, including preferred
shares (the "Total Dividends"), then the portion of the Capital Gains Amount
that will be allocable to the holders of StREITs(SM) will be the Capital Gains
Amount multiplied by a fraction, the numerator of which will be the total
dividends (within the meaning of the Code) paid or made available to the holders
of the StREITs(SM) for the year and the denominator of which will be the Total
Dividends.
(d) If any StREITs(SM) are outstanding and except if the Company
determines it is necessary to maintain its status as a REIT, no dividends shall
be declared or paid or set apart for payment on any series of capital stock of
the Corporation ranking, as to dividends, on parity with or junior to
StREITs(SM) for any period unless full cumulative dividends have been or
contemporaneously are declared and paid or declared and a sum sufficient for the
payment thereof set apart for such payment on the StREITs(SM) for all past
dividend periods and the then current dividend period. When dividends are not
paid in full (or a sum sufficient for such full payment is not set apart) upon
the StREITs(SM) and the shares of any other series of capital stock ranking on
parity as to dividends with the StREITs(SM), all dividends declared upon
StREITs(SM) and any other series of capital stock ranking on parity as to
dividends with StREITs(SM) shall be declared pro rata so that the amount of
dividends declared per share on the StREITs(SM) and such other series of capital
stock shall in all cases bear to each other the same ratio that accrued
dividends per share on the StREITs(SM) and such other series of capital stock
bear to each other.
(e) Except as provided in Section 2(d) or if the Company determines it
is necessary to maintain its status as a
2
<PAGE>
REIT, unless full cumulative dividends on the StREITs(SM) have been or
contemporaneously are declared and paid or declared and a sum sufficient for the
payment thereof set apart for payment for all past dividend periods and the then
current dividend period, no dividends (other than in shares of Common Stock or
other capital stock ranking junior to StREITs(SM) as to dividends and upon
liquidation) shall be declared or paid or set aside for payment or other
dividend shall be declared or made upon the shares of Common Stock or any other
capital stock of the Corporation ranking junior to or on parity with StREITs(SM)
as to dividends or amounts upon liquidation, nor shall any shares of Common
Stock or any other capital stock of the Corporation ranking junior to or on a
parity with StREITs(SM) as to dividends or amounts upon liquidation be redeemed,
purchased or otherwise acquired for any consideration (or any moneys be paid to
or made available for a sinking fund for the redemption of any such stock) by
the Corporation (except by conversion into or exchange for other capital stock
of the Corporation ranking junior to StREITs(SM) as to dividends and amounts
upon liquidation).
(f) Any dividend payment made on the StREITs(SM) shall first be
credited against the earliest accrued but unpaid dividend due with respect to
the StREITs(SM) which remains payable.
3. Liquidation Rights.
(a) Upon any voluntary or involuntary liquidation, dissolution or
winding up of the affairs of the Corporation, then, before any distribution or
payment shall be made to the holders of any shares of Common Stock or any other
class or series of capital stock of the Corporation ranking junior to
StREITs(SM) in the distribution of assets upon any liquidation, dissolution or
winding up of the affairs of the Corporation, the holders of StREITs(SM) shall
be entitled to receive out of assets of the Corporation legally available for
distribution to stockholders, liquidation distributions in the amount of the
liquidation preference of $100.00 per share, plus an amount equal to all
distributions accrued and unpaid thereon. After payment of the full amount of
the liquidating distributions to which they are entitled, the holders of
StREITs(SM) will have no right or claim to any of the remaining assets of the
Corporation. In the event that, upon any such voluntary or involuntary
liquidation, dissolution or winding up, the available assets of the Corporation
are insufficient to pay the amount of the liquidation distributions on all
outstanding StREITs(SM) and the corresponding amounts payable on all shares of
other classes or series of capital stock of the Corporation ranking on parity
with the StREITs(SM) in the distribution of assets upon any liquidation,
dissolution or winding up of the affairs of the Corporation ("Parity Shares"),
then the holders of the StREITs(SM) and all other Parity Shares shall share
ratably in any such distribution of assets in proportion to the full liquidating
distributions to which they would otherwise be respectively entitled.
3
<PAGE>
(b) A consolidation or merger of the Corporation with or into any
other entity, or the sale, lease or conveyance of all or substantially all of
the property or business of the Corporation, shall not be deemed to constitute a
liquidation, dissolution or winding up of the affairs of the Corporation.
4. Redemption.
(a) The StREITs(SM) are not redeemable prior to September 30, 2007.
On and after September 30, 2007, the Corporation at its option upon not less
than 30 nor more than 60 days' written notice, may redeem the StREITs(SM), in
whole or in part, at any time or from time to time, for cash at a redemption
price of $100.00 per share, plus an amount equal to all dividends accrued and
unpaid thereon to the date fixed for redemption, without interest. The
redemption price of the StREITs(SM) (other than the portion thereof consisting
of accrued and unpaid dividends) is payable solely out of proceeds from the sale
of other capital stock of the Corporation, which may include common stock,
preferred stock, depositary shares, participation or other ownership interests
in the Corporation, however designated and any rights (other than debt
securities convertible into or exchangeable for capital stock), warrants or
options to purchase any thereof. Holders of StREITs(SM) to be redeemed shall
surrender such StREITs(SM) at the place designated in such notice and shall be
entitled to the redemption price and any accrued and unpaid dividends payable
upon such redemption following such surrender. If fewer than all of the
outstanding StREITs(SM) are to be redeemed, the number of shares to be redeemed
will be determined by the Corporation, and such shares may be redeemed pro rata
from the holders of record of such shares in proportion to the number of such
shares held by such holders (with adjustments to avoid redemption of fractional
shares) or by lot in a manner determined by the Corporation.
(b) Unless full cumulative dividends on all StREITs(SM) and all Parity
Shares shall have been or contemporaneously are declared and paid or declared
and a sum sufficient for the payment thereof set apart for payment for all past
dividend periods and the then current dividend period, no StREITs(SM) or Parity
Shares shall be redeemed unless all outstanding StREITs(SM) and Parity Shares
are simultaneously redeemed; provided, however, that the foregoing shall not
prevent the purchase or acquisition of StREITs(SM) pursuant to a purchase or
exchange offer made on the same terms to holders of all outstanding StREITs(SM)
or Parity Shares, as the case may be. Furthermore, unless full cumulative
dividends on all outstanding StREITs(SM) and Parity Shares have been or
contemporaneously are declared and paid or declared and a sum sufficient for the
payment thereof set apart for payment for all past dividend periods and the then
current dividend period, the Corporation shall not purchase or otherwise acquire
directly or indirectly any StREITs(SM) or Parity Shares (except by conversion
into or exchange for shares of capital stock of the Corporation
4
<PAGE>
ranking junior to the StREITs(SM) and Parity Shares as to dividends and amounts
upon liquidation).
(c) Notice of redemption will be mailed at least 30 days but not more
than 60 days before the redemption date to each holder of record of the
StREITs(SM) at the address shown on the share transfer books of the Corporation.
Each notice shall state: (i) the redemption date; (ii) the number of StREITs
(SM) to be redeemed; (iii) the redemption price; (iv) the place or places where
certificates for StREITs(SM) are to be surrendered for payment of the redemption
price; and (v) that dividends on the StREITs(SM) will cease to accrue on such
redemption date. If fewer than all StREITs(SM) are to be redeemed, the notice
mailed to each such holder thereof shall also specify the number of StREITs(SM)
to be redeemed from each such holder. If notice of redemption of any
StREITs(SM) has been given and if the funds necessary for such redemption have
been set aside by the Corporation in trust for the benefit of the holders of
StREITs(SM) so called for redemption, then from and after the redemption date,
dividends will cease to accrue on the StREITs(SM), such StREITs(SM) shall no
longer be deemed outstanding and all rights of the holders of such shares will
terminate, except the right to receive the redemption price.
(d) The holders of StREITs(SM) at the close of business on a Dividend
Record Date will be entitled to receive the dividends payable with respect to
such StREITs(SM) on the corresponding Dividend Payment Date notwithstanding the
redemption thereof between such Dividend Record Date and the corresponding
Dividend Payment Date or the Corporation's default in the payment of the
dividend due. Except as provided above, the Corporation will make no payment or
allowance for unpaid dividends, whether or not in arrears, on StREITs(SM) which
have been called for redemption.
(e) The StREITs(SM) will not be subject to any sinking fund or
mandatory redemption. However, in order to preserve the Corporation's status as
a REIT, as defined in the Code, the StREITs(SM) may be subject to purchase by
the Corporation, as provided in Article IV of the Articles of this Corporation.
5. Voting Rights.
(a) Except as indicated in this Section 5, or except as otherwise from
time to time required by applicable law, the holders of StREITs(SM) will have no
voting rights.
(b) If six quarterly dividends (whether or not consecutive) payable on
the StREITs(SM) or any Parity Shares are in arrears, whether or not earned or
declared, the number of directors then constituting the Board of Directors of
the Corporation will be increased by two, and the holders of StREITs(SM), voting
together as a class with the holders of any
5
<PAGE>
other series of Parity Shares with like voting rights, will have the right to
elect two additional directors to serve on the Corporation's Board of Directors
at any annual meeting of stockholders or a properly called special meeting of
the holders of StREITs(SM) and such other Parity Shares until all dividends
accumulated on such StREITs(SM) and Parity Shares have been declared and paid or
set aside for payment. The term of office of all directors so elected will
terminate with the termination of such voting rights.
(c) The approval of two-thirds of the outstanding StREITs(SM), voting
separately as a class, is required in order to (i) amend the Corporation's
Articles Supplementary or Articles of Incorporation to affect materially and
adversely the rights, preferences or voting power of the holders of the
StREITs(SM), (ii) enter into a share exchange that affects the StREITs(SM), or
consolidate with or merge the Corporation with or into any other corporation,
unless in each such case each StREITs(SM) remains outstanding without a material
adverse change to its terms and rights or is converted into or exchanged for
preferred stock of the surviving entity having preferences and other rights,
voting powers, restrictions, limitations as to dividends, qualifications and
terms or conditions of redemption thereof identical to that of the StREITs(SM),
or (iii) authorize, reclassify, create or increase the authorized amount of any
class of capital stock having rights senior to the StREITs(SM) with respect to
the payment of dividends or amounts upon liquidation, dissolution or winding up
of the affairs of the Corporation. However, the Corporation may create
additional classes of Parity Shares and shares ranking junior to the StREITs(SM)
as to distributions or amounts upon liquidation, dissolution or winding up of
the affairs of the Corporation ("Junior Shares"), increase the authorized number
of Parity Shares and Junior Shares and issue additional series of Parity Shares
and Junior Shares without the consent of any holder of StREITs(SM) or Parity
Shares.
(d) Except as provided above and as required by law, the holders of
StREITs(SM) are not entitled to vote on any merger or consolidation involving
the Corporation, or a sale of all or substantially all of the assets of the
Corporation.
6. Conversion.
The StREITs(SM) are not convertible into or exchangeable for any other
property or securities of the Corporation at the option of the holder.
6
<PAGE>
IN WITNESS WHEREOF, NATIONWIDE HEALTH PROPERTIES, INC. has caused
these presents to be signed in its name and on its behalf by its President and
Chief Executive Officer and witnessed by its Assistant Secretary on September
24, 1997.
WITNESS: NATIONWIDE HEALTH PROPERTIES, INC.
/s/ MARK L. DESMOND By: /s/ R. BRUCE ANDREWS
- -------------------- -------------------------------------
Mark L. Desmond R. Bruce Andrews
Assistant Secretary President and Chief Executive Officer
THE UNDERSIGNED, President and Chief Executive Officer of NATIONWIDE
HEALTH PROPERTIES, INC., who executed on behalf of the Corporation the Articles
Supplementary of which this certificate is made a part, hereby acknowledges in
the name and on behalf of said Corporation the foregoing Articles Supplementary
to be the corporate act of said Corporation and hereby certifies that the
matters and facts set forth herein with respect to the authorization and
approval thereof are true in all material respects under the penalties of
perjury.
/s/ R. BRUCE ANDREWS
--------------------------------
R. Bruce Andrews
<PAGE>
EXHIBIT 4.1
PREFERRED STEP-UP PREFERRED STEP-UP
REIT SECURITIES REIT SECURITIES
PA
NATIONWIDE HEALTH PROPERTIES, INC.
FORMED UNDER THE LAWS OF THE STATE OF MARYLAND
SEE REVERSE FOR CERTAIN DEFINITIONS
CUSIP 638620 20 3
THIS CERTIFIES THAT
IS THE RECORD HOLDER OF
FULLY PAID AND NONASSESSABLE SHARES OF 7.677% SERIES A CUMULATIVE PREFERRED
STEP-UP REIT SECURITIES, PAR VALUE $1.00 PER SHARE
of Nationwide Health Properties, Inc. transferable on the share register of the
Corporation by the holder hereof in person or by duly authorized attorney upon
surrender of this Certificate properly endorsed. This Certificate is not valid
until countersigned by the Transfer Agent and registered by the Registrar.
Reference is made to the statement on the reverse hereof with respect to the
classes or series of shares, and certain restrictions on the transferability
thereof.
Witness the facsimile seal of the Corporation and the facsimile signatures of
its duly authorized officers.
Dated:
/s/ DON M. PEARSON /s/ R. BRUCE ANDREWS
SECRETARY PRESIDENT
COUNTERSIGNED AND REGISTERED:
THE BANK OF NEW YORK
TRANSFER AGENT AND REGISTRAR
BY
AUTHORIZED SIGNATURE
[SEAL OF NATIONWIDE HEALTH PROPERTIES, INC.]
<PAGE>
NATIONWIDE HEALTH PROPERTIES, INC.
Nationwide Health Properties, Inc. is authorized to issue two classes of
shares, Common and Preferred, and the Preferred may be issued in one or more
series. The corporation will furnish to any stockholder, on request and without
charge, a statement of the designations, preferences, conversions and other
rights, voting powers, restrictions, limitations as to dividends, qualifications
and terms and conditions of redemption of the stock of each class, or series,
which the corporation is authorized to issue and any other information required
by Section 2-211 of the Corporations and Associations Article of the Annotated
Code of Maryland. The board of directors of the corporation has authority to fix
all or any of the dividend rights, dividend rate, conversion rights, voting
rights, rights and terms of redemption (including sinking fund provisions), the
redemption price or prices, and the liquidation preferences of any wholly
unissued Preferred shares or of any wholly unissued series of Preferred shares,
the number of shares constituting any unissued series of Preferred shares, and
the designations of such shares.
The transfer of these shares to any person who would thereby hold
beneficial interest of more than 9.9% of the outstanding shares of stock of the
Corporation may be prohibited or void or subject to other transfer restriction
or redemption rights as set forth in the Articles of Incorporation. The
Corporation will furnish information concerning such restrictions to any
stockholder on request and without charge.
The following abbreviations, when used in the inscription on the face of
this certificate, shall be construed as though they were written out in full
according to applicable laws or regulations:
<TABLE>
<S> <C>
TEN COM -- as tenants in common UNIF GIFT MIN ACT -- ___________________Custodian_______________
TEN ENT -- as tenants by the entireties (Cust) (Minor)
JT TEN -- as joint tenants with right of under Uniform Gifts to Minors
survivorship and not as tenants Act _______________________________________
in common (State)
UNIF TRF MIN ACT -- _____________Custodian (until age____________)
(Cust)
______________________under Uniform Transfers
(Minor)
to Minors Act________________________________
(State)
</TABLE>
Additional abbreviations may also be used though not in the above list.
FOR VALUE RECEIVED,___________________________ hereby sell, assign and
transfer unto
PLEASE INSERT SOCIAL SECURITY OR OTHER
IDENTIFICATION NUMBER OF ASSIGNEE
- --------------------------------------------------------------------------------
(PLEASE PRINT OR TYPEWRITE NAME AND ADDRESS, INCLUDING ZIP CODE, OF ASSIGNEE)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------Shares
of the capital stock represented by the within Certificate, and do hereby
constitute and appoint
- ------------------------------------------------------------------------Attorney
to transfer the said stock on the books of the within named Corporation with
full power of substitution in the premises.
Dated_____________________________
X_______________________________________
X_______________________________________
Signature(s) Guaranteed NOTICE: THE SIGNATURE(S) TO THIS ASSIGNMENT
MUST CORRESPOND WITH THE NAME(S) AS
WRITTEN UPON THE FACE OF THE
CERTIFICATE IN EVERY PARTICULAR,
WITHOUT ALTERATION OR ENLARGEMENT
OR ANY CHANGE WHATEVER.
By___________________________________________________________________________
THE SIGNATURE(S) SHOULD BE GUARANTEED BY AN ELIGIBLE GUARANTOR INSTITUTION
(BANKS, STOCKBROKERS, SAVINGS AND LOAN ASSOCIATIONS AND CREDIT UNIONS WITH
MEMBERSHIP IN AN APPROVED SIGNATURE GUARANTEE MEDALLION PROGRAMS, PURSUANT TO
S.E.C. RULE 17Ad-15.
<PAGE>
EXHIBIT 8.1
[LETTERHEAD OF O'MELVENY & MYERS LLP]
September
24th
1 9 9 7
614,055-84
LA3-800541.V1A
Nationwide Health Properties, Inc.
610 Newport Center Drive, Suite 1150
Newport Beach, California 92660
Re: Nationwide Health Properties, Inc. -
Form S-3 Registration Statement
------------------------------------
Gentlemen:
In connection with the above Registration Statement regarding the
proposed issuance and sale of the 7.677% Series A Cumulative Preferred Step-Up
REIT Securities (Liquidation Preference $100 per Share) of Nationwide Health
Properties, Inc., a Maryland corporation (the "Company"), you have requested our
opinion whether the Company qualified as a real estate investment trust (a
"REIT") under sections 856 through 860 of the Internal Revenue Code of 1986, as
amended (the "Code"), for its taxable year ended December 31, 1996 and whether
it will continue to so qualify if it operates subsequent to June 30, 1997 in the
same manner as it has prior to that date. You have also asked our opinion
whether the Company should be treated as the owner of its properties listed in
the schedule which you provided to us (the "Properties") for federal income tax
purposes and whether the leases with respect to such Properties (the "Leases")
should be treated as true leases, and not financing arrangements, for such
purposes. All capitalized terms in this opinion and not otherwise defined
herein shall have the same respective meanings as set forth in the Registration
Statement.
As of July 25, 1997, we delivered our opinion (the "7/25/97 Opinion")
concerning the qualification of the Company as a REIT for its taxable year ended
December 31, 1996 and its
<PAGE>
Page 2 - Nationwide Health Properties, Inc. - September 24, 1997
continuing qualifications as a REIT if it operated subsequent to June 30, 1997
in the same manner as it had prior to that date. The 7/25/97 Opinion, and the
certificates, documents and other materials referred to therein, are hereby
incorporated by reference. Since July 25, 1997, there have been delivered to us
certain certificates and schedules prepared and executed by Company personnel,
setting forth certain factual representations regarding the Company and its
assets and operations. This opinion specifically relies on such documents,
certificates and schedules and assumes that the facts represented therein will
not change in any material way so long as the Company seeks to qualify as a
REIT.
On the basis of the foregoing and subject to all of the
qualifications, conditions and factual assumptions set forth herein and in the
7/25/97 Opinion, we are of the opinion that for the calendar year 1996, the
Company met each of the requirements for qualification as a REIT, and if the
Company operates subsequent to June 30, 1997 in the same manner as it has prior
to such date, it will continue to so qualify, provided that the various tests
for qualification as a REIT relating to its income, assets, distributions,
ownership and certain administrative matters are satisfied in those years.
However, we are unable to opine whether the Company will actually continue to
qualify as a REIT because such qualification will depend on future transactions
and events which cannot be known at this time.
We also wish to advise you that on the basis of and in reliance on the
foregoing and on the facts set forth in the Registration Statement, it is the
opinion of O'Melveny & Myers LLP that under current law, including relevant
statutes, regulations, and judicial and administrative precedent (which law is
subject to change on a retroactive basis), a court, more likely than not, would
hold that the Company would be treated as the owner of the Properties for
federal income tax purposes and the Leases would be treated as true leases, and
not financing arrangements, for such purposes. You should be aware that this
opinion is not binding on the Internal Revenue Service and no assurance can be
given that the Internal Revenue Service may not successfully challenge the
conclusions set forth in this opinion. If the Internal Revenue Service
successfully challenged such conclusions, the Company would not be entitled to
claim depreciation with respect to the Properties and might be compelled to make
deficiency dividends to satisfy the 95% dividend distribution requirement or
lose its REIT status.
Respectfully submitted,
/s/ O'Melveny & Myers LLP
