ITEM 1.01 ENTRY INTO MATERIAL DEFINITIVE AGREEMENTS.
Sale of Preferred Units in our Operating Partnership
On June 18, 2014, in connection with the funding of a tender offer by Sentio
Healthcare Properties, Inc. (the "Company," "we" or "us") for shares of Company
common stock, a purchase of securities (the "Put Exercise") was completed by
Sentinel RE Investment Holdings, LP, an affiliate of Kohlberg Kravis Roberts &
Co., (the "Investor") pursuant to the Securities Purchase Agreement (as amended,
the "Purchase Agreement") dated as of February 10, 2013 between us, Sentio
Healthcare Properties OP, L.P. (our "Operating Partnership"), and the Investor.
The Purchase Agreement and the transactions contemplated thereunder were
previously reported in the Company's Current Report on Form 8-K (the "Prior
8-K") filed with the Securities and Exchange Commission on February 12, 2013.
Pursuant to the Put Exercise, the Investor purchased the following securities
for an aggregate purchase price of $8.7 million:
• 87,260 newly-issued Series B Convertible Preferred Units of limited
partnership interest of the Operating Partnership (the "Series B Preferred
Units"), which are convertible into approximately 870,858 shares of the
Company's common stock at the currently effective conversion price.
After giving effect to the Put Exercise, 1,164,740 Series B Preferred Units
remain issuable under the Purchase Agreement. The obligation of the Investor to
purchase additional Series B Preferred Units under the Purchase Agreement is
conditioned upon, among other things, the receipt of notice from us of the
intention to sell a specified amount of securities to the Investor to finance a
proposed real estate acquisition. The Company has invested the net proceeds from
the Put Exercise to purchase the outstanding shares of common stock accepted
pursuant to the tender offer.
Disclosure concerning the other terms and conditions of the Series B Convertible
Preferred Operating Partnership
units, the transfer and registration thereof and
the covenants in the Purchase Agreement and the related agreements is
incorporated herein by reference from the Prior 8-K. The above summary of the
issue of the Series B Preferred Units does purport to be complete and is
qualified in its entirety by reference to the Purchase Agreement and related
agreements attached to on the Prior 8-K as Exhibits 10.1, 10.2 and 10.3, and
incorporated by reference herein.
ITEM 3.02 UNREGISTERED SALE OF EQUITY SECURITIES.
The Put Exercise was made pursuant to the private placement exemption from
registration provided by Section 4(2) of the Securities Act of 1933, as amended,
and Rule 506 promulgated by the SEC
thereunder. The information set forth under
Item 1.01 of this Current Report on Form 8-K is hereby incorporated by reference
into this Item 3.02.