Quality Care Properties Provides Update On HCR ManorCare
BETHESDA, MD–Quality Care Properties, Inc. (NYSE: QCP) (“QCP” or the “Company”) announced today that it has agreed with HCR ManorCare, Inc. and HCR III Healthcare, LLC, the Company’s principal tenant (collectively, “HCR ManorCare”) to extend the deadline for HCR ManorCare’s response to QCP’s receivership complaint to October 18, 2017, subject to Court approval, to allow for the continuation of workout discussions. As previously announced, on August 17, 2017, QCP filed a complaint against HCR ManorCare seeking the appointment of an independent receiver for QCP’s skilled nursing and assisted living/memory care facilities.
HCR ManorCare continues to be in default under the Master Lease and Security Agreement, dated as of April 7, 2011, as amended and supplemented (the “Master Lease”) and the Guaranty of Obligations effective as of February 11, 2013 (the “Guaranty”) with respect to obligations under the Master Lease.
HCR ManorCare has paid approximately $17.6 million in rent for September. As previously reported, HCR ManorCare paid approximately $23 million in rent for August. Over $385 million in rent and other obligations continue to be immediately due and payable under the Master Lease and the Guaranty.
The restructuring advisory firm of Alvarez & Marsal, on behalf of QCP, is expected to work alongside HCR ManorCare’s restructuring advisory firm, AlixPartners, to support ongoing workout discussions. The advisory firms of Houlihan Lokey and Lazard are also advising QCP with respect to such discussions and with respect to remarketing activities for QCP facilities leased to HCR ManorCare.
In addition, HCR ManorCare has informed QCP that Paul Ormond has stepped down from the Board of Directors and from his positions as Chairman, President and Chief Executive officer of HCR ManorCare and that Steve Cavanaugh, HCR ManorCare’s Executive Vice President and Chief Operating Officer, has been appointed President and Chief Executive Officer of HCR ManorCare.