Item 1.01. Entry into a Material Agreement.
On January 14, 2022, EPR Properties (the "Company") entered into a Fourth
Amendment to Note Purchase Agreement (the "Fourth Amendment") relating to the
Note Purchase Agreement, dated August 1, 2016 (the "Original Note Purchase
Agreement"), as amended by a First Amendment to Note Purchase Agreement dated as
of September 27, 2017, a Second Amendment to Note Purchase Agreement dated as of
June 29, 2020 (the "Second Amendment"), and a Third Amendment to Note Purchase
Agreement dated as of December 24, 2020 (the "Third Amendment", and together
with the Original Note Purchase Agreement, as further amended, supplemented or
otherwise modified prior to the Fourth Amendment, the "Existing Note Purchase
Agreement"), among the Company and certain institutional investors party
thereto. The Existing Note Purchase Agreement and Fourth Amendment govern the
terms of the Company's outstanding 4.35% Series A Notes due 2024 and its 4.56%
Series B Notes due 2026 (collectively, the "Private Placement Bonds"). The
Company and the institutional investors entered into the Fourth Amendment to,
among other things: (i) amend certain financial and other covenants and
provisions in the Existing Note Purchase Agreement to conform generally to the
changes beneficial to the Company in the corresponding covenants and provisions
contained in the Company's new Third Amended, Restated and Consolidated Credit
Agreement, dated October 6, 2021 (the "Credit Agreement"), with KeyBank National
Association, as administrative agent, and the other agents and lenders party
thereto; and (ii) amend certain financial and other covenants and provisions in
the Existing Note Purchase Agreement to reflect the prior termination of the
Covenant Relief Period (as such term is defined in the Existing Note Purchase
Agreement) and removal of related provisions. The Existing Note Purchase
Agreement, as amended by the Fourth Amendment, is referred to herein as the
"Amended Note Purchase Agreement". Capitalized terms used and not otherwise
defined herein have the meanings given to them in the Amended Note Purchase
Agreement.
The Amended Note Purchase Agreement amends the Existing Note Purchase Agreement
to, among other things:
•Conform certain financial and other covenants and provisions to the changes
made in the Credit Agreement that are beneficial to the Company, including
revising the Eligible Real Estate categories and related valuation methods,
revising the definition of Eligible Subsidiary to permit the Company's use of an
UPREIT structure for property acquisitions, and revising the definition of
Permitted Liens to permit liens on properties to secure payment-in-lieu-of-taxes
obligations.
•Reflect the termination of the Covenant Relief Period and removal of related
provisions, including removing provisions requiring springing equity pledges and
mortgages with respect to Unencumbered Properties upon certain specified events,
removing the increased interest rate payable during the Covenant Relief Period,
removing the covenant requiring the Company to make a pro rata prepayment offer
for the Private Placement Bonds upon certain transactions, removing the
modification to the maximum secured debt to total asset value covenant
applicable during the Covenant Relief Period, removing the minimum liquidity
covenant, and removing specified operational and other financial covenants
applicable during the Covenant Relief Period. As previously disclosed, the
Company terminated the Covenant Relief Period in July 2021, at which time these
provisions were no longer applicable to the Company.
The foregoing description of the Fourth Amendment does not purport to be
complete and is subject to, and qualified in its entirety by, reference to the
full text of the Fourth Amendment, a copy of which will be filed with the
Securities and Exchange Commission as an exhibit to the Company's Annual Report
on Form 10-K for the year ending December 31, 2021.
Item 2.03. Creation of a Direct Financial Obligation or an Obligation under an
Off-Balance Sheet Arrangement of a Registrant.
The information set forth under Item 1.01 above is incorporated herein by
reference as if fully set forth herein.
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Item 3.03. Material Modification to Rights of Security Holders.
The information set forth under Item 1.01 above is incorporated herein by
reference as if fully set forth herein.
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