2031 Notes Offering
On September 21, 2021, Sabra Health Care REIT, Inc. (“Sabra”) and Sabra Health Care Limited Partnership (the “Issuer”) entered into an underwriting agreement (the “Underwriting Agreement”) with Wells Fargo Securities, LLC, BofA Securities, Inc., Credit Agricole Securities (USA) Inc. and J.P. Morgan Securities LLC, as representatives of the several underwriters named therein, pursuant to which the Issuers agreed to issue and sell $800.0 million aggregate principal amount of 3.200% senior notes due 2031 (the “2031 Notes”) pursuant to an effective registration statement filed with the Securities and Exchange Commission (the “Commission”) on December 11, 2019 (File No. 333-235449). The 2031 Notes will be fully and unconditionally guaranteed on a senior unsecured basis by Sabra. The offering is expected to close on September 30, 2021, subject to the satisfaction of customary closing conditions and to the issuance by the Issuer prior to closing of an irrevocable notice of redemption for all of its outstanding 4.800% senior notes due 2024 (the “2024 Notes”).
Sabra intends to use a portion of the net proceeds from the offering to redeem all of the 2024 Notes and repay approximately $345.0 million of its U.S. dollar term loans maturing on September 9, 2023, and the remaining net proceeds to fund future investments or for general corporate purposes. Prior to these uses, Sabra may temporarily use net proceeds designated for such purposes to repay borrowings outstanding on its unsecured revolving credit facility and/or invest in interest-bearing accounts and short-term, interest-bearing securities.
The foregoing description of the Underwriting Agreement is a summary only and is qualified in its entirety by reference to the complete terms of the Underwriting Agreement, which is filed as Exhibit 1.1 to this Current Report on Form 8-K and is incorporated by reference into this Item 8.01.
2024 Notes Redemption
On September 22, 2021, the Issuer delivered to Wells Fargo Bank, National Association, as trustee (the “Trustee”), an irrevocable notice of redemption for all $300.0 million aggregate principal amount of the outstanding 2024 Notes (CUSIP No. 78572XAF8). The 2024 Notes are redeemable at a cash redemption price equal to 100.00% of the principal amount being redeemed plus a “make-whole” premium calculated in accordance with the indenture governing the 2024 Notes (the “Redemption Price”), plus accrued and unpaid interest thereon to, but not including, the redemption date of October 7, 2021 (the “Redemption Date”). The Issuer’s obligation to complete the redemption of the 2024 Notes on the Redemption Date is not subject to any condition precedent. Upon completion of the redemption, no 2024 Notes will remain outstanding.
Payment of the Redemption Price plus accrued and unpaid interest to holders of the 2024 Notes will be made on or after the Redemption Date upon presentation and surrender of the 2024 Notes to the paying agent for cancellation at the address specified in the notice of redemption. Interest on the 2024 Notes called for redemption will cease to accrue on and after the Redemption Date. The notice of redemption was delivered by the Trustee to the registered holders of the 2024 Notes on September 22, 2021, in accordance with the requirements of the indenture governing the 2024 Notes. The foregoing does not constitute a notice of redemption for the 2024 Notes.
