| Entry into a Material Definitive Agreement. |
Senior Secured Notes Offering
On February 13, 2025, MPT Operating Partnership, L.P. (the “Operating Partnership”), a Delaware limited partnership and the operating partnership of Medical Properties Trust, Inc., a Maryland corporation (the “Company”), and MPT Finance Corporation, a Delaware corporation and wholly owned subsidiary of the Operating Partnership (together with the Operating Partnership, the “Issuers”) closed the previously announced offering (the “Offering”) of $1,500,000,000 aggregate principal amount of the Issuers’ 8.500% Senior Secured Notes due 2032 (the “Dollar Notes”) and €1,000,000,000 aggregate principal amount of the Issuers’ 7.000% Senior Secured Notes due 2032 (the “Euro Notes” and, together with the Dollar Notes, the “Notes”). The Issuers sold the Notes to the initial purchasers in the Offering, which was exempt from the registration requirements of the Securities Act of 1933, as amended (the “Securities Act”). The Notes were offered for resale to purchasers reasonably believed to be “qualified institutional buyers” as defined in Rule 144A under the Securities Act and to
non-U.S.
persons outside the United States in reliance on Regulation S under the Securities Act.
The Notes were issued pursuant to the Indenture, dated as of February 13, 2025 (the “Indenture”), among the Company, the Issuers, the subsidiary guarantors party thereto, Wilmington Trust, National Association, as trustee (the “Trustee”), dollar paying agent, dollar registrar, dollar transfer agent and notes collateral agent, and U.S. Bank Europe DAC, as euro paying agent, euro registrar and euro transfer agent. Interest on the Notes is payable semi-annually in arrears on February 15 and August 15 of each year, commencing on August 15, 2025. The Notes mature on February 15, 2032. The Issuers may redeem some or all of the Notes at any time prior to February 15, 2028 at a “make-whole” redemption price. On or after February 15, 2028, the Issuers may redeem some or all of the Notes at a premium that will decrease over time. In addition, at any time and from time to time prior to February 15, 2028, the Issuers may redeem up to 40% of the Dollar Notes at a redemption price equal to 108.500% of the aggregate principal amount thereof and up to 40% of the Euro Notes at a redemption price equal to 107.000% of the aggregate principal amount thereof, in each case, plus accrued and unpaid interest thereon to, but excluding the redemption date, using the proceeds from one or more equity offerings.
The Notes are fully and unconditionally guaranteed, on a joint and several basis, by the Company and its collateral-owning subsidiaries, in addition to its other subsidiaries that are guarantors under the Credit Agreement (as defined below) (collectively, the “Guarantors”) and will be fully and unconditionally guaranteed, on a joint and several basis, by any restricted subsidiaries that in the future borrow under or guarantee borrowings under the Credit Agreement, in each case, subject to customary guarantee fall-away provisions. The Notes and the guarantees thereof are secured, subject to certain permitted liens, by first-priority liens on equity of the Company’s subsidiaries that, as of the date hereof, directly own or ground lease a diversified pool of 169 properties with 20 different operators in the United States, the United Kingdom and Germany (the “Collateral”), which Collateral also secures the obligations under the Credit Agreement.
In the event of a Change of Control Triggering Event (as defined in the Indenture), each holder of the Notes may require the Issuers to repurchase some or all of its Notes at a repurchase price equal to 101% of the aggregate principal amount of such Notes, plus accrued and unpaid interest, if any, up to, but excluding, the date of purchase.
The Indenture restricts the Issuers’ ability and the ability of their restricted subsidiaries to, among other things: (i) incur debt; (ii) pay dividends and make distributions; (iii) create liens; (iv) enter into transactions with affiliates; and (v) merge, consolidate or transfer all or substantially all of their assets. These limitations are subject to a number of important exceptions and qualifications set forth in the Indenture. The Indenture also requires the Issuers and their restricted subsidiaries to maintain total unencumbered assets of at least 150% of their collective unsecured debt. All of these covenants are subject to a number of important limitations and exceptions under the Indenture.
The Indenture also provides for customary events of default, including, but not limited to, the failure to make payments of interest or premium, if any, on, or principal of, the Notes, as applicable, the failure to comply with certain covenants and agreements specified in the Indenture for a period of time after notice has been provided, the acceleration of other indebtedness resulting from the failure to pay principal on such other indebtedness prior to its maturity, the failure of the liens created by the security documents to constitute valid and perfected liens on any material portion of the Collateral securing the Notes for a specified period of time after notice and certain events of insolvency. If an Event
