SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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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): January 11, 2002
FIVE STAR QUALITY CARE, INC.
(Exact name of registrant as specified in charter)
Maryland 001-16817 04-3516029
(State or other jurisdiction (Commission (I.R.S. employer
of incorporation) file number) identification number)
400 Centre Street, Newton, Massachusetts 02458
(Address of principal executive offices) (Zip code)
Registrant's telephone number, including area code: 617-796-8387
Item 2. Acquisition or Disposition of Assets.
On January 11, 2002, Senior Housing Properties Trust and Crestline
Capital Corporation ("Crestline") closed the transactions contemplated by the
Stock Purchase Agreement (the "Stock Purchase Agreement"), dated as of August 9,
2001, among Crestline, CSL Group, Inc., Senior Housing Properties Trust ("Senior
Housing") and a subsidiary of Senior Housing, as amended by Amendment to Stock
Purchase Agreement, dated November 5, 2001, among Crestline, CSL Group, Inc.
Senior Housing and a subsidiary of Senior Housing. Under the Stock Purchase
Agreement, a subsidiary of Senior Housing acquired 31 senior living communities
from Crestline through the acquisition of the capital stock of CSL Group, Inc.
Simultaneously with Senior Housing's closing of the transactions
contemplated by the Stock Purchase Agreement, we:
o assumed the rights and obligations of the owner of the 31 communities under
existing management agreements with Marriott Senior Living Services, Inc.;
o acquired certain operating assets and liabilities of the 31 communities;
and
o leased the 31 communities from Senior Housing on a net lease basis
requiring annual minimum rent of $63 million.
We closed these transactions pursuant to the Transaction Agreement dated
December 7, 2001 (the "Transaction Agreement") by and among Senior Housing,
certain subsidiaries of Senior Housing named therein, us, certain subsidiaries
of ours named therein, FSQ, Inc., Hospitality Properties Trust, HRPT Properties
Trust and REIT Management & Research LLC ("RMR"). The Transaction Agreement
governed our spin-off from Senior Housing, which we completed on December 31,
2001, as well as our participation in the Crestline transaction. No separate
consideration was paid by us for the business acquisition described in this Item
2 because these transactions comprising the business acquisition were part of
our spin-off from Senior Housing. Prior to December 31, 2001, we were a wholly
owned subsidiary of Senior Housing.
On a pro forma basis as of September 30, 2001, the operating assets and
liabilities acquired are principally comprised of accounts receivables of $8.9
million and accrued operating liabilities of $12.5 million. We are currently in
the process of calculating the actual amount of the operating assets and
liabilities acquired, and the net of these operating assets and liabilities, if
any, will be settled between Senior Housing and us in cash. The terms of our
lease with Senior Housing for the 31 communities as well as our other
participation in the Crestline transaction were previously disclosed in our
Prospectus dated December 6, 2001, which is a part of our Registration Statement
on Form S-1, File No. 333-69846.
All of our directors, except for Dr. Bruce M. Gans, are trustees of
Senior Housing. Our president and treasurer are also employees of RMR, the
investment manager to Senior Housing. RMR also provides certain administrative
services to us. Gerard M. Martin and Barry M. Portnoy, our two managing
directors, are directors and 50% owners of RMR. We previously disclosed other
relationships between the parties to the Transaction Agreement and Messrs.
Martin and Portnoy in our Prospectus dated December 6, 2001, which is a part of
our Registration Statement on Form S-1, File No. 333-69846.
Item 7. Financial Statements, Pro Forma Financial Information and Exhibits.
(a) Financial Statements. The financial statements required by Item
7(a) are omitted pursuant to General Instruction B.3 to Form 8-K.
The financial statements required by Item 7(a) have been
previously reported by Five Star Quality Care, Inc. in its
Registration Statement on Form S-1 (File No. 333-69846).
(b) Pro Forma Financial Information. The pro forma financial
information required by Item 7(b) is omitted pursuant to General
Instruction B.3 to Form 8-K. The pro forma financial information
required by Item 7(b) has been previously reported by Five Star
Quality Care, Inc. in its Registration Statement on Form S- 1
(File No. 333-69846).
(c) Exhibits.
2.1 Stock Purchase Agreement dated as of August 9, 2001, among Senior
Housing Properties Trust, SNH/CSL Properties Trust, Crestline Capital
Corporation and CSL Group, Inc., including forms of Promissory Note,
Escrow Agreement and Tax Allocation Agreement (Incorporated by
reference to Senior Housing Properties Trust's Current Report on Form
8-K dated September 21, 2001).
2.2 Amendment to Stock Purchase Agreement among Senior Housing Properties
Trust, SNH/CSL Properties Trust, Crestline Capital Corporation and CSL
Group, Inc. dated November 5, 2001 (Incorporated by reference to Senior
Housing Properties Trust's Current Report on Form 8-K dated November 5,
2001).
2.3 Transaction Agreement by and among Senior Housing Properties Trust,
certain subsidiaries of Senior Housing Properties Trust party thereto,
Five Star Quality Care, Inc., certain subsidiaries of Five Star Quality
Care, Inc. party thereto, FSQ, Inc., Hospitality Properties Trust, HRPT
Properties Trust and Reit Management & Research LLC (Incorporated by
reference to Senior Housing Properties Trust's Current Report on Form
8-K dated December 13, 2001).
2.4 Amended Master Lease Agreement by and among certain affiliates of
Senior Housing Properties Trust, as Landlord, and FS Tenant Holding
Company Trust and FS Tenant Pool III Trust, as Tenant, dated January
11, 2002 (Incorporated by reference to Senior Housing Properties
Trust's Current Report on Form 8-K dated December 31, 2001).
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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 hereunto duly authorized.
FIVE STAR QUALITY CARE, INC.
By: /s/ Bruce J. Mackey Jr.
Name: Bruce J. Mackey Jr.
Title: Treasurer and Chief Financial
Officer
Date: January 25, 2002