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<P STYLE="margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><B>UNITED STATES</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><B>SECURITIES AND EXCHANGE COMMISSION</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><B>WASHINGTON, D.C. 20549</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><B></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">&nbsp;&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><B>FORM 8-K</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><B>&nbsp;&nbsp;</B></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><B></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><B>CURRENT REPORT</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><B>Pursuant to Section 13 or 15(d) of the</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><B>Securities Exchange Act of 1934</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">Date of report (Date of earliest event reported):
November 15, 2013</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><B>OMEGA HEALTHCARE INVESTORS, INC.</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">(Exact name of registrant as specified in charter)</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><B>&nbsp;</B></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font-size: 10pt; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 34%; font-size: 10pt; text-align: center"><FONT STYLE="font-size: 10pt"><B>Maryland</B></FONT></TD>
    <TD STYLE="width: 33%; font-size: 10pt; text-align: center"><FONT STYLE="font-size: 10pt"><B>1-11316</B></FONT></TD>
    <TD STYLE="width: 33%; font-size: 10pt; text-align: center"><FONT STYLE="font-size: 10pt"><B>38-3041398</B></FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="font-size: 10pt; text-align: center"><FONT STYLE="font-size: 10pt">(State of incorporation)</FONT></TD>
    <TD STYLE="font-size: 10pt; text-align: center"><FONT STYLE="font-size: 10pt">(Commission File Number)</FONT></TD>
    <TD>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">(IRS Employer</P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">Identification No.)</P></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><B>200 International Circle</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><B>Suite 3500</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><B>Hunt Valley, Maryland 21030</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">(Address of principal executive offices / Zip
Code)</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><B>(410) 427-1700</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">(Registrant&rsquo;s telephone number, including
area code)</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><B>Check the appropriate box below if the Form 8-K filing is intended
to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.7in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.7in"><FONT STYLE="font: 10pt Wingdings">&uml;</FONT>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Written
communications pursuant to Rule 425 under the Securities Act.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.7in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.7in"><FONT STYLE="font: 10pt Wingdings">&uml;</FONT>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Soliciting
material pursuant to Rule 14a-12 under the Exchange Act.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.7in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.7in"><FONT STYLE="font: 10pt Wingdings">&uml;</FONT>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.7in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.7in"><FONT STYLE="font: 10pt Wingdings">&uml;</FONT>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="color: black"><B>Item 5.02&nbsp;&nbsp; </B></FONT><B>Departure
of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain
Officers.</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Effective November 15, 2013, the Compensation
Committee of the Board of Directors of Omega Healthcare Investors, Inc. (&ldquo;Omega&rdquo;) approved the terms of new employment
agreements (collectively, the &ldquo;Employment Agreements&rdquo;) with each of Taylor Pickett, Daniel Booth, Robert Stephenson,
Lee Crabill and Michael Ritz (collectively, the &ldquo;Officers&rdquo;). As of November 15, 2013, the Compensation Committee also
approved the grants, effective December 31, 2013 and January 1, 2014, respectively, of long-term incentive compensation awards
to the Officers as further described below. The Compensation Committee engaged an independent compensation consultant to advise
the Committee in structuring and benchmarking the compensation arrangements against appropriate peers for each Officer.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><B><U>Employment Agreements </U></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Employment Agreements have been executed
effective November 15, 2013. The significant features of the Employment Agreements are summarized below.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font: 10pt Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify"><U>Term</U>. The term of each Employment Agreement commences November 15, 2013 and will expire
on December&nbsp;31, 2016.</TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.75in; text-align: justify; text-indent: -0.25in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font: 10pt Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify"><U>Annual Base Salary</U>. Each Employment Agreement specifies the current annual base salary for
the Officer, effective January 1, 2013, which is as follows:</TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.75in; text-align: justify; text-indent: -0.25in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 50%; margin-left: 1.5in">
<TR STYLE="vertical-align: bottom">
    <TD NOWRAP STYLE="font-size: 10pt; text-align: justify; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 8pt"><B>Name</B></FONT></TD><TD NOWRAP STYLE="font-size: 10pt; padding-bottom: 1pt"><FONT STYLE="font-size: 8pt"><B>&nbsp;</B></FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="font-size: 10pt; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 8pt"><B>Annual Base
    Salary</B></FONT></TD><TD NOWRAP STYLE="padding-bottom: 1pt; font-size: 10pt"><FONT STYLE="font-size: 8pt"><B>&nbsp;</B></FONT></TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt; text-align: justify">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 67%; font-size: 10pt; text-align: justify">Pickett</TD><TD STYLE="width: 1%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 30%; font-size: 10pt; text-align: right">700,000</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: justify">Booth</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right">440,000</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: justify">Stephenson</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right">400,000</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: justify">Crabill</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right">330,000</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: justify">Ritz</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right">265,000</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.75in; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.75in; text-align: justify">The annual base salary for each
of the Officers will be subject to review as of January 1, 2014, and at least annually thereafter for possible increases.</P>

<P STYLE="font: 10pt Symbol; margin: 0 0 0 0.75in; text-align: justify; text-indent: -0.25in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font: 10pt Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify"><U>Annual Bonus</U>. Each Officer will be eligible to receive a cash bonus in an amount equal to
a specified percentage of his annual base salary as indicated below based on the level of performance achieved.</TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.5in; text-align: justify">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 89%; margin-left: 0.75in">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt; text-align: justify; padding-bottom: 1pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" STYLE="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 8pt">Threshold</FONT></TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" STYLE="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 8pt">Target</FONT></TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" STYLE="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 8pt">High</FONT></TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 25%; font-size: 10pt; text-align: justify">Pickett</TD><TD STYLE="width: 1%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 22%; font-size: 10pt; text-align: right">100</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">%</TD><TD STYLE="width: 1%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 22%; font-size: 10pt; text-align: right">125</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">%</TD><TD STYLE="width: 1%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 22%; font-size: 10pt; text-align: right">150</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">%</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: justify">Booth</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">50</TD><TD STYLE="font-size: 10pt; text-align: left">%</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">75</TD><TD STYLE="font-size: 10pt; text-align: left">%</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">100</TD><TD STYLE="font-size: 10pt; text-align: left">%</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: justify">Stephenson</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">50</TD><TD STYLE="font-size: 10pt; text-align: left">%</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">62.5</TD><TD STYLE="font-size: 10pt; text-align: left">%</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">75</TD><TD STYLE="font-size: 10pt; text-align: left">%</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: justify">Crabill</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">30</TD><TD STYLE="font-size: 10pt; text-align: left">%</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">50</TD><TD STYLE="font-size: 10pt; text-align: left">%</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">70</TD><TD STYLE="font-size: 10pt; text-align: left">%</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: justify">Ritz</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">40</TD><TD STYLE="font-size: 10pt; text-align: left">%</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">50</TD><TD STYLE="font-size: 10pt; text-align: left">%</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">60</TD><TD STYLE="font-size: 10pt; text-align: left">%</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">&nbsp;</P>


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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.75in; text-align: justify">The bonus metrics, the relative
weighting of the bonus metrics and the specific threshold, target and high levels of each metric for 2013, previously approved
by the Compensation Committee in January 2013, are as follows:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.5in; text-align: justify; text-indent: -0.5in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 89%; margin-left: 0.75in">
<TR STYLE="vertical-align: bottom">
    <TD NOWRAP STYLE="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 8pt">Metric</FONT></TD><TD NOWRAP STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 8pt">Weighting</FONT></TD><TD NOWRAP STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 8pt">Threshold</FONT></TD><TD NOWRAP STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 8pt">Target</FONT></TD><TD NOWRAP STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 8pt"><B>High</B><SUP>(4)</SUP></FONT></TD><TD NOWRAP STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 40%; font-size: 10pt; text-align: center"><FONT STYLE="font-size: 10pt">Adjusted FFO per share<SUP>(1)</SUP></FONT></TD><TD STYLE="width: 1%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 12%; font-size: 10pt; text-align: right">40</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">%</TD><TD STYLE="width: 1%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD NOWRAP STYLE="width: 12%; font-size: 10pt; text-align: right">2.45</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 1%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD NOWRAP STYLE="width: 12%; font-size: 10pt; text-align: right">2.47</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 1%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD NOWRAP STYLE="width: 12%; font-size: 10pt; text-align: right">2.51</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: center"><FONT STYLE="font-size: 10pt">Tenant quality (uncollected rents)<SUP>(2)</SUP></FONT></TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">30</TD><TD STYLE="font-size: 10pt; text-align: left">%</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD NOWRAP STYLE="font-size: 10pt; text-align: center"><FONT STYLE="font-size: 10pt">Less than 2%</FONT></TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD NOWRAP STYLE="font-size: 10pt; text-align: center"><FONT STYLE="font-size: 10pt">Less than 1.5%</FONT></TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD NOWRAP STYLE="font-size: 10pt; text-align: center"><FONT STYLE="font-size: 10pt">Less than 1%</FONT></TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: center"><FONT STYLE="font-size: 10pt">Subjective<SUP>(3)</SUP></FONT></TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">30</TD><TD STYLE="font-size: 10pt; text-align: left">%</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD NOWRAP STYLE="font-size: 10pt; text-align: center"><FONT STYLE="font-size: 10pt">N/A</FONT></TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD NOWRAP STYLE="font-size: 10pt; text-align: center"><FONT STYLE="font-size: 10pt">N/A</FONT></TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD NOWRAP STYLE="font-size: 10pt; text-align: center"><FONT STYLE="font-size: 10pt">N/A</FONT></TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 63pt; text-align: justify; text-indent: -27pt"><SUP>&nbsp;</SUP></P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.75in"></TD><TD STYLE="width: 0.25in">(1)</TD><TD STYLE="text-align: justify">Adjusted funds from operations per share. The adjusted FFO metric will be subject to adjustment
to reflect the pro forma impact of changes to Omega&rsquo;s capital structure that were not contemplated in the annual budget approved
by the Board of Directors.</TD></TR></TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.75in"></TD><TD STYLE="width: 0.25in">(2)</TD><TD STYLE="text-align: justify">2013 uncollected rents as a percentage of 2013 gross revenue.</TD></TR></TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.75in"></TD><TD STYLE="width: 0.25in">(3)</TD><TD STYLE="text-align: justify">Subjective determination of the Compensation Committee, including among other things, factors such
as subjective evaluation of individual performance, funded debt/total asset value and/or credit rating upgrade from a rating agency.</TD></TR></TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.75in"></TD><TD STYLE="width: 0.25in">(4)</TD><TD STYLE="text-align: justify">As to any bonus metrics except the subjective metric, if the level of achievement of the relevant
performance metric is between threshold and target or between target and high, then the portion of the bonus earned with respect
to that metric will be determined by linear interpolation.</TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.75in; text-align: justify">The performance metrics, the weighting
set forth above and the specific required levels at threshold, target and high, will continue to apply for 2014 and each subsequent
year through 2016 unless the Compensation Committee changes the metrics or the weighting by no later than the first ninety (90)
days of the year in which such change is to occur. If the Compensation Committee makes a change, the change will continue to apply
for 2014 and each subsequent year through 2016 unless the Compensation Committee changes the metrics or the weighting by no later
than the first ninety (90) days of the year in which such change is to occur. All required levels for threshold, target and high
performance for any year that are based on objective criteria of the type contained in Omega&rsquo;s budget will be based on Omega&rsquo;s
budget for the year that has been approved by the Board of Directors.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.5in; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.75in; text-align: justify">Each of the Officers will be eligible
for a prorated bonus if the Officer&rsquo;s employment is terminated during the year due to death. Otherwise, each of the Officers
will be eligible for a bonus only if the Officer is employed by Omega on the date the bonus is paid, except that if the term of
employment is not extended beyond December 31, 2016, the Officer will be eligible for a bonus for 2016 if he is employed by Omega
on December 31, 2016.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font: 10pt Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify"><U>Severance</U>. &nbsp;&nbsp;If the Officer&rsquo;s employment is terminated by Omega without cause (as defined
in the Employment Agreement) or the Officer terminates his employment for good reason (as defined in the Employment Agreement),
Omega will pay the Officer severance equal to a multiple of the sum of annual base salary plus average annual bonus payable for
the three completed fiscal years prior to his termination. The multiple and the number of years over which such severance pay will
be paid are next to each Officer&rsquo;s name below:</TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">&nbsp;</P>


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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="width: 45%; border-collapse: collapse; font-size: 10pt; margin-left: 1.3in">
<TR STYLE="vertical-align: top; background-color: rgb(204,238,255)">
    <TD STYLE="width: 80%">Pickett</TD>
    <TD STYLE="width: 20%; text-align: left">3</TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD>Booth</TD>
    <TD STYLE="text-align: left">2</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(204,238,255)">
    <TD>Stephenson</TD>
    <TD STYLE="text-align: left">1.5</TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD>Crabill</TD>
    <TD STYLE="text-align: left">1.5</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(204,238,255)">
    <TD>Ritz</TD>
    <TD STYLE="text-align: left">1</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 1in; text-align: justify; text-indent: -0.25in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.75in; text-align: justify">Payment of severance is contingent
upon the Officer providing a comprehensive release to Omega. Severance will not be paid if the term of the Employment Agreement
expires, if an Officer terminates employment upon or following expiration of the term of the Employment Agreement, if the Officer
resigns without good reason or if his employment is terminated by Omega for cause.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 1in; text-align: justify; text-indent: -0.25in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.75in; text-align: justify">If any payments would be subject
to the excise tax associated with parachute payments in connection with a change in control, the severance payments (and any other
payments or benefits) under any other agreements will be reduced to the maximum amount that can be paid without incurring an excise
tax, but only if that would result in the Officer retaining a larger after-tax amount.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.75in; text-align: justify">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font: 10pt Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify"><U>Non-compete/Non-solicitation</U>. During the period of employment and for the potential severance
period thereafter, each Officer will be obligated not to provide managerial services or management consulting services to a competing
business (as defined in the Employment Agreement) within the states in which Omega does business. In addition, each Officer will
be prohibited during the term of the Employment Agreement and for the potential severance period thereafter from soliciting (i)
clients or customers with whom he had material contact or (ii) management level or key employees of Omega to other employers. If
the Officer remains employed by Omega through December 31, 2016, and as a result no severance is paid, then the non-compete and
non-solicitation provisions will expire at December 31, 2016.</TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.75in; text-align: justify; text-indent: -0.25in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><B><U>Long-Term Incentive Compensation</U></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><U>Overview</U></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">As previously reported, the Compensation Committee
earlier determined to shift from its past practice of making equity grants every three years for sequential &ldquo;end-to-end&rdquo;
grant cycles (i.e., 2008-2010, 2011-2013) to annual grants for &ldquo;rolling three-year&rdquo; grant cycles (i.e., 2014-2016,
2015-2017, 2016-2018). Accordingly, rather than making a single round of equity awards for the 2014-2016 performance cycle with
no additional long-term incentive awards until 2017, the Committee determined to implement a new long-term incentive compensation
program effective January 1, 2014 with smaller annual grants than previous grants made every three years. As of November 15, 2013,
the Compensation Committee approved the grant, effective January 1, 2014, of long-term incentive compensation awards to each of
the Officers as the first grant under the new annual rolling three year long-term incentive compensation program. As of November
15, 2013, the Compensation Committee also approved the grant, effective December 31, 2013, of one-time transition awards to each
of the Officers to make up for the lost compensation opportunity that the Officers would otherwise
suffer</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">&nbsp;</P>


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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">in Omega&rsquo;s transition in 2014 from the three-year end-to-end long-term incentive compensation program to the annual
rolling three-year long-term incentive compensation program. Each grant is subject to the Officer&rsquo;s continued employment
through the applicable grant date.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The number of shares of Omega common stock
issuable under the annual grants and the transition grants are based on projected aggregate accrued taxable income potentially
realizable by each Officer, rather than the estimated compensation expense to be recognized by Omega under generally accepted accounting
principles (&ldquo;GAAP&rdquo;). Omega expects that the compensation expense associated with the annual and transition grants under
GAAP will be substantially less than projected aggregate accrued taxable income realizable by the Officers. Projected aggregate
accrued taxable income includes projected dividends and reflects potential accrued taxable income at various levels of Omega&rsquo;s
performance as described below.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The significant features of the long-term incentive
compensation grants are summarized below. The descriptions of the timing of payment below assumes that the Officer has not elected
to defer receipt of the common stock or dividend equivalents under Omega&rsquo;s Deferred Stock Plan.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.25in; text-align: justify"><U>One-Time Transition Grants effective
December 31, 2013</U>.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.25in; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.25in; text-align: justify">The projected aggregate accrued
taxable long-term incentive compensation opportunity (including dividends) for each Officer under the one-time transition grants
of time-based restricted stock units (&ldquo;RSUs&rdquo;) and performance restricted stock units (&ldquo;PRSUs&rdquo;) for the
period from December 31, 2013 through December 31, 2016 is noted in the table below. The threshold, target and high levels of long-term
incentive compensation are based in part on Total Stockholder Return (&ldquo;TSR&rdquo;) performance and Relative TSR performance
for the performance period. TSR is determined by reference to the total aggregate change in Omega&rsquo;s stock price per share
over the performance period plus dividends per share declared with respect to the performance period. Relative TSR means Omega&rsquo;s
TSR as compared to the total shareholder return reported for the MSCI U.S. REIT Index for the performance period. For calculating
TSR and Relative TSR, the starting and ending stock prices used are the November and December average closing price per share at
the beginning and the end of the performance periods.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.25in; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.25in; text-align: center"><B>Projected Aggregate Accrued Taxable
Compensation Opportunity</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.25in; text-align: center"><B>Transition Grants*</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.25in; text-align: justify">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 88%; margin-left: 0.4in">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt; text-align: justify; padding-bottom: 1pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" STYLE="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 8pt">Threshold</FONT></TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" STYLE="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 8pt">Target</FONT></TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" STYLE="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 8pt">High</FONT></TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 25%; font-size: 10pt; text-align: justify">Pickett</TD><TD STYLE="width: 1%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 22%; font-size: 10pt; text-align: right">3,598,312</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 1%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 22%; font-size: 10pt; text-align: right">7,425,496</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 1%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 22%; font-size: 10pt; text-align: right">13,558,791</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: justify">Booth</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right">2,113,236</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right">4,076,529</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right">7,276,645</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: justify">Stephenson</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right">1,491,260</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right">3,117,939</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right">5,737,421</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: justify">Crabill</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right">1,100,234</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right">2,213,936</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right">4,042,656</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: justify">Ritz</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right">215,215</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right">440,967</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right">1,213,120</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.85in; text-align: justify">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.75in"></TD><TD STYLE="width: 0.25in">*</TD><TD STYLE="text-align: justify">Represents projected accrued taxable income realizable by the Officer as of December 31, 2016.
Omega&rsquo;s anticipated compensation expense is expected to be materially lower. See &ldquo;Overview&rdquo; above.</TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.25in; text-align: justify; text-indent: -0.25in">&nbsp;</P>


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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.25in; text-align: justify; text-indent: -0.25in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font: 10pt Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify"><U>Restricted Stock Unit Awards</U>. &nbsp;&nbsp;&nbsp;&nbsp;Each Officer&rsquo;s transition long-term incentive compensation
opportunity will consist in part of a one-time, time-based restricted stock unit award. The number of shares of Omega common stock
subject to the RSU award will be that number of shares that is projected to produce as of December 31, 2016, one-half of the taxable
compensation opportunity at target in the table immediately above. Each RSU award will be subject to three-year ratable vesting
(1/3 per year) on December 31, 2014, 2015 and 2016 and will be subject to the Officer&rsquo;s continued employment on the vesting
date, except in the case of death, disability, termination by Omega without cause, or resignation for good reason (a &ldquo;Qualifying
Termination&rdquo;) in connection with a change in control (as defined in the award agreement), in which case vesting is accelerated
100%. Dividend equivalents accrue on the RSUs and will be paid currently on unvested and vested units. The number of vested RSUs
will be paid in Omega common stock upon vesting.</TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.75in; text-align: justify; text-indent: -0.25in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font: 10pt Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify"><U>Performance Restricted Stock Unit Awards</U>. &nbsp;&nbsp;&nbsp;&nbsp;The remainder of each Officer&rsquo;s transition
long-term incentive compensation will consist of a one-time award of PRSUs. The total number of shares of Omega common stock subject
to these PRSUs at each performance level (threshold, target and high) will be that number of shares that is projected to produce
as of December 31, 2016, an amount equal to the taxable compensation opportunity shown in the table above less the projected taxable
compensation amount attributable to the RSUs under the transition grants. Therefore, the total number of shares issued under the
PRSUs if target performance is achieved will be equal to the number of shares subject to the RSUs under the transition grant. The
total number of shares issued under the PRSUs if threshold performance is achieved will be less, and if high performance is achieved
will be more, than the number of shares subject to the RSUs under the transition grant. The PRSUs will be split into three component
grants (28.6%, 28.6% and 42.8%, respectively, of the total transition PRSU grant) relating to three different performance periods,
each starting on December 31, 2013 but ending December 31, 2014, December 31, 2015 and December 31, 2016, respectively. The number
of PRSUs that will be earned for each performance period will depend 50% on the level of absolute TSR and 50% on the level of relative
TSR achieved over the performance periods ending December 31, 2014, December 31, 2015 and December 31, 2016, respectively, as set
forth in the table below.<U> </U></TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 77%; margin-left: 0.8in">
<TR STYLE="vertical-align: bottom">
    <TD NOWRAP STYLE="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 8pt">TSR-Based
    PRSUs</FONT></TD><TD NOWRAP STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 8pt">Threshold</FONT></TD><TD NOWRAP STYLE="padding-bottom: 1pt; font-size: 10pt; font-weight: bold"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 8pt">Target</FONT></TD><TD NOWRAP STYLE="padding-bottom: 1pt; font-size: 10pt; font-weight: bold"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 8pt">High</FONT></TD><TD NOWRAP STYLE="padding-bottom: 1pt; font-size: 10pt; font-weight: bold"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 55%; font: 10pt Times New Roman, Times, Serif; text-align: left">TSR (annualized and compounded annually)</TD><TD STYLE="width: 1%; font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="width: 1%; font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="width: 12%; font: 10pt Times New Roman, Times, Serif; text-align: right">8</TD><TD STYLE="width: 1%; font: 10pt Times New Roman, Times, Serif; text-align: left">%</TD><TD STYLE="width: 1%; font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="width: 1%; font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="width: 12%; font: 10pt Times New Roman, Times, Serif; text-align: right">10</TD><TD STYLE="width: 1%; font: 10pt Times New Roman, Times, Serif; text-align: left">%</TD><TD STYLE="width: 1%; font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="width: 1%; font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="width: 12%; font: 10pt Times New Roman, Times, Serif; text-align: right">12</TD><TD STYLE="width: 1%; font: 10pt Times New Roman, Times, Serif; text-align: left">%</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 8pt; font-weight: bold; text-decoration: underline; text-align: center">Relative TSR-Based PRSUs</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: justify">Basis Points</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">-300</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">0</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right"><FONT STYLE="font-size: 10pt">+300</FONT></TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.6in; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.75in; text-align: justify">The number of shares earned under
the PRSUs will be determined as of the last day of each performance period. The earned PRSUs vest on the last day of the performance
period, subject to the Officer&rsquo;s continued employment on the vesting date, except in the case of a Qualifying Termination.
If the Qualifying Termination is not in connection with a change in control, vesting will be prorated based on days</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.75in; text-align: justify">&nbsp;</P>


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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.75in; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.75in; text-align: justify">elapsed through the date of the
Qualifying Termination. If the Qualifying Termination is in connection with a change in control, the performance period will end
on the date of the change in control. If the Officer is employed on the date of the change in control or has a Qualifying Termination
in connection with a change in control, depending on the level of TSR and Relative TSR as of the date of the change in control,
all, a portion or none of the PRSUs will be earned and vested on the date of the change in control.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 76.5pt; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.75in; text-align: justify">The earned and vested PRSUs will
be paid in Omega common stock, along with dividend equivalents to be paid in cash, within ten (10) days following the last day
of the performance period or on the date of a change in control, if earlier.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.85in; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.75in; text-align: justify">Dividend equivalents declared with
respect to the applicable performance period accrue on PRSUs that subsequently vest. Accrued dividend equivalents will be paid
to the Officer at the date the shares attributable to vested PRSUs are distributable.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.25in; text-align: justify"><U>Annual Grants for Rolling Three-Year
Periods commencing January 1, 2014</U>.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.25in; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.25in; text-align: justify">Each Officer&rsquo;s grant effective
January 1, 2014 will be for RSUs and PRSUs that provide an opportunity to earn that number of shares of common stock of Omega over
a three year period that would produce the projected aggregate accrued taxable long-term incentive compensation opportunity (including
dividends) as of December 31, 2016 shown in the table below. Like the transition grants described above, the threshold, target
and high levels of long-term incentive compensation is based in part on Total Stockholder Return (&ldquo;TSR&rdquo;) performance
and Relative TSR for the performance period.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.25in; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.25in; text-align: center"><B>Projected Aggregate Accrued Taxable
Long-term Incentive Compensation Opportunity</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.25in; text-align: center"><B>Annual Grants for 2014-2016 Performance
Period*</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.25in; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.25in; text-align: justify"></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 88%; margin-left: 0.5in">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt; text-align: justify; padding-bottom: 1pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" STYLE="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 8pt">Threshold</FONT></TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" STYLE="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 8pt">Target</FONT></TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" STYLE="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 8pt">High</FONT></TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 25%; font-size: 10pt; text-align: justify">Pickett</TD><TD STYLE="width: 1%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 22%; font-size: 10pt; text-align: right">2,056,178</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 1%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 22%; font-size: 10pt; text-align: right">4,243,141</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 1%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 22%; font-size: 10pt; text-align: right">7,747,880</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: justify">Booth</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right">1,207,563</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right">2,329,445</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right">4,158,083</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: justify">Stephenson</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right">849,292</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right">1,781,680</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right">3,278,526</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: justify">Crabill</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right">628,705</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right">1,265,106</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right">2,310,089</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: justify">Ritz</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right">121,550</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right">251,981</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right">693,211</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.25in; text-align: justify"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.25in; text-align: justify">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.75in"></TD><TD STYLE="width: 0.25in">*</TD><TD STYLE="text-align: justify">Represents projected accrued taxable income realizable by the Officer as of December 31, 2016.
The Company&rsquo;s anticipated compensation expense is expected to be materially lower. See &ldquo;Overview&rdquo; above.</TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 1in; text-align: justify; text-indent: -0.25in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font: 10pt Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify"><U>Restricted Stock Unit Awards</U>. &nbsp;&nbsp;Like the transition award described above, each Officer&rsquo;s
annual long-term incentive compensation award will consist in part of a time-based RSU award. The number of shares of Omega common
stock subject to the RSU award will be that number of shares that is projected to produce as of December 31, 2016, one-half of
the taxable compensation amount at target in the table immediately above. Each RSU award will be subject to three-year cliff vesting
on December 31, 2016 and will be subject to the Officer&rsquo;s continued employment on the vesting date, except in the case of
a Qualifying Termination. If the Qualifying</TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.75in; text-align: justify; text-indent: -0.25in">&nbsp;</P>


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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.75in; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.75in; text-align: justify">Termination is not in connection
with a change in control, the Officer will vest in the percentage of the RSUs set forth below.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="width: 50%; border-collapse: collapse; font-size: 10pt; margin-left: 0.75in">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 60%; text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 8pt"><B>Year&nbsp;of&nbsp;Qualifying</B><BR>
    <B>Termination</B></FONT></TD>
    <TD STYLE="width: 2%"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 37%; text-align: center; padding-bottom: 0; border-bottom: Black 1pt solid; vertical-align: bottom"><FONT STYLE="font-size: 8pt"><B>Percentage&nbsp;Vested</B></FONT></TD>
    <TD STYLE="width: 1%">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: center">2014</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">33<SUP>1</SUP>/<SUB>3</SUB></TD>
    <TD>%</TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD STYLE="text-align: center">2015</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">66<SUP>2</SUP>/<SUB>3</SUB></TD>
    <TD>%</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: center">2016</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">100</TD>
    <TD>%</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.85in; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.75in; text-align: justify">If the Qualifying Termination is
in connection with a change in control, vesting will be accelerated 100%. Dividend equivalents accrue on the RSU awards and will
be paid currently on unvested and vested units. The number of vested RSUs will be paid in Omega common stock upon vesting.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.75in; text-align: justify">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font: 10pt Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify"><U>Performance Restricted Stock Unit Awards</U>. Like the transition grants, the remainder of each
Officer&rsquo;s annual long-term incentive compensation will consist of an award of PRSUs. The total number of shares of Omega
common stock subject to these PRSUs at each performance level (threshold, target and high) will be that number of shares that is
projected to produce as of December 31, 2016, an amount equal to the taxable compensation opportunity shown in the table above,
less the projected taxable compensation amount attributable to the RSUs under the annual grants. Therefore, like the transition
grants, the total number of shares issued under these PRSUs if target performance is achieved will be equal to the number of shares
subject to the RSUs under the annual grant. Similarly, the total number of shares issued under the PRSUs if threshold performance
is achieved will be less, and if high performance is achieved will be more, than the number of shares subject to the RSUs under
the annual grant. The level of PRSUs that will be earned will be based (i) 50% on the level of absolute TSR and (ii) 50% on the
level of relative TSR achieved over the three year performance period ending December 31, 2016, as set forth in the same table
that applies to the transition grants of PRSUs above.</TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.75in; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.75in; text-align: justify">The number of shares earned under
the PRSUs will be determined as of the last day of the performance period. 25% of the earned PRSUs will vest on the last day of
each quarter in 2017, subject to the Officer&rsquo;s continued employment on the vesting date, except in the case of a Qualifying
Termination. If the Qualifying Termination is not in connection with a change in control, vesting will be prorated based on days
elapsed through the date of the Qualifying Termination or will be accelerated 100% if the Qualifying Termination occurs on or after
December 31, 2016. Like the transition grants of PRSUs, if the Qualifying Termination is in connection with a change in control,
the performance period will end on the date of the change in control. If the Officer is employed on the date of the change in control
or has a Qualifying Termination in connection with a change in control, depending on the level of TSR and Relative TSR as of the
date of the change in control, all, a portion or none of the PRSUs will be earned and vested on the date of the change in control.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 1.1in; text-align: justify">&nbsp;</P>


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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 1.1in; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.75in; text-align: justify">The earned and vested PRSUs will
be paid in Omega common stock, along with dividend equivalents to be paid in cash, within ten (10) days following the last day
of the performance period or on the date of a change in control, if earlier.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.75in; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.75in; text-align: justify">Dividend equivalents declared with
respect to the applicable performance period accrue on PRSUs that subsequently vest and are paid. Accrued dividend equivalents
will be paid to the Officer at the date the shares attributable to vested PRSUs are distributable.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.75in; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><B>Item 9.01&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Financial
Statements and Exhibits</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="width: 100%; border-collapse: collapse; font-size: 10pt">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 8%; border-bottom: windowtext 1pt solid"><FONT STYLE="font-size: 8pt"><B>Number</B></FONT></TD>
    <TD STYLE="width: 1%"><FONT STYLE="font-size: 8pt"><B>&nbsp;</B></FONT></TD>
    <TD STYLE="width: 91%; border-bottom: windowtext 1pt solid; text-align: center"><FONT STYLE="font-size: 8pt"><B>Description</B></FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>10.1</TD>
    <TD>&nbsp;</TD>
    <TD>Employment Agreement, dated November 15, 2013, between Omega Healthcare Investors, Inc. and C. Taylor Pickett.</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>10.2</TD>
    <TD>&nbsp;</TD>
    <TD>Employment Agreement, dated November 15, 2013, between Omega Healthcare Investors, Inc. and Daniel Booth.</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>10.3</TD>
    <TD>&nbsp;</TD>
    <TD>Employment Agreement, dated November 15, 2013, between Omega Healthcare Investors, Inc. and Robert O. Stephenson.</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>10.4</TD>
    <TD>&nbsp;</TD>
    <TD>Employment Agreement, dated November 15, 2013, between Omega Healthcare Investors, Inc. and R. Lee Crabill.</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>10.5</TD>
    <TD>&nbsp;</TD>
    <TD>Employment Agreement, dated November 15, 2013, between Omega Healthcare Investors, Inc. and Michael Ritz.</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>10.6</TD>
    <TD>&nbsp;</TD>
    <TD>Form of Time-Based Restricted Stock Unit Agreement for Transition Grants (2013).</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>10.7</TD>
    <TD>&nbsp;</TD>
    <TD>Form of Performance-Based Restricted Stock Unit Agreement for Transition Grants (2013).</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>10.8</TD>
    <TD>&nbsp;</TD>
    <TD>Form of Time-Based Restricted Stock Unit Agreement for Annual Grants (commencing 2014).</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>10.9</TD>
    <TD>&nbsp;</TD>
    <TD>Form of Performance-Based Restricted Stock Unit Agreement for Annual Grants (commencing 2014).</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">&nbsp;</P>


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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><B>SIGNATURES</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in">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 thereunto duly authorized.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="width: 100%; border-collapse: collapse; font-size: 10pt">
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD COLSPAN="2">OMEGA HEALTHCARE INVESTORS, INC.</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD COLSPAN="2">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 50%">&nbsp;</TD>
    <TD STYLE="width: 4%">By:</TD>
    <TD STYLE="width: 46%; border-bottom: Black 1pt solid">/s/ C. Taylor Pickett</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD COLSPAN="2">C. Taylor Pickett</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD COLSPAN="2">President and Chief Executive Officer</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">Dated:&nbsp;&nbsp;November 19, 2013</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>


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</HTML>
[{"type": "8-K", "sequence": "1", "filename": "t1300650_8k.htm", "description": "FORM 8-K", "secsgml_size_bytes": 83955}]
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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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):
November 15, 2013
OMEGA HEALTHCARE INVESTORS, INC.
(Exact name of registrant as specified in charter)
Maryland
1-11316
38-3041398
(State of incorporation)
(Commission File Number)
(IRS Employer
Identification No.)
200 International Circle
Suite 3500
Hunt Valley, Maryland 21030
(Address of principal executive offices / Zip
Code)
(410) 427-1700
(Registrant's telephone number, including
area code)
Check the appropriate box below if the Form 8-K filing is intended
to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
¨
Written
communications pursuant to Rule 425 under the Securities Act.
¨
Soliciting
material pursuant to Rule 14a-12 under the Exchange Act.
¨
Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act.
¨
Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act.
Item 5.02
Departure
of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain
Officers.
Effective November 15, 2013, the Compensation
Committee of the Board of Directors of Omega Healthcare Investors, Inc. ("Omega") approved the terms of new employment
agreements (collectively, the "Employment Agreements") with each of Taylor Pickett, Daniel Booth, Robert Stephenson,
Lee Crabill and Michael Ritz (collectively, the "Officers"). As of November 15, 2013, the Compensation Committee also
approved the grants, effective December 31, 2013 and January 1, 2014, respectively, of long-term incentive compensation awards
to the Officers as further described below. The Compensation Committee engaged an independent compensation consultant to advise
the Committee in structuring and benchmarking the compensation arrangements against appropriate peers for each Officer.
Employment Agreements
The Employment Agreements have been executed
effective November 15, 2013. The significant features of the Employment Agreements are summarized below.
·
Term
. The term of each Employment Agreement commences November 15, 2013 and will expire
on December 31, 2016.
·
Annual Base Salary
. Each Employment Agreement specifies the current annual base salary for
the Officer, effective January 1, 2013, which is as follows:
Name
Annual Base
    Salary
Pickett
$
700,000
Booth
$
440,000
Stephenson
$
400,000
Crabill
$
330,000
Ritz
$
265,000
The annual base salary for each
of the Officers will be subject to review as of January 1, 2014, and at least annually thereafter for possible increases.
·
Annual Bonus
. Each Officer will be eligible to receive a cash bonus in an amount equal to
a specified percentage of his annual base salary as indicated below based on the level of performance achieved.
Threshold
Target
High
Pickett
100
%
125
%
150
%
Booth
50
%
75
%
100
%
Stephenson
50
%
62.5
%
75
%
Crabill
30
%
50
%
70
%
Ritz
40
%
50
%
60
%
2
The bonus metrics, the relative
weighting of the bonus metrics and the specific threshold, target and high levels of each metric for 2013, previously approved
by the Compensation Committee in January 2013, are as follows:
Metric
Weighting
Threshold
Target
High
(4)
Adjusted FFO per share
(1)
40
%
$
2.45
$
2.47
$
2.51
Tenant quality (uncollected rents)
(2)
30
%
Less than 2%
Less than 1.5%
Less than 1%
Subjective
(3)
30
%
N/A
N/A
N/A
(1)
Adjusted funds from operations per share. The adjusted FFO metric will be subject to adjustment
to reflect the pro forma impact of changes to Omega's capital structure that were not contemplated in the annual budget approved
by the Board of Directors.
(2)
2013 uncollected rents as a percentage of 2013 gross revenue.
(3)
Subjective determination of the Compensation Committee, including among other things, factors such
as subjective evaluation of individual performance, funded debt/total asset value and/or credit rating upgrade from a rating agency.
(4)
As to any bonus metrics except the subjective metric, if the level of achievement of the relevant
performance metric is between threshold and target or between target and high, then the portion of the bonus earned with respect
to that metric will be determined by linear interpolation.
The performance metrics, the weighting
set forth above and the specific required levels at threshold, target and high, will continue to apply for 2014 and each subsequent
year through 2016 unless the Compensation Committee changes the metrics or the weighting by no later than the first ninety (90)
days of the year in which such change is to occur. If the Compensation Committee makes a change, the change will continue to apply
for 2014 and each subsequent year through 2016 unless the Compensation Committee changes the metrics or the weighting by no later
than the first ninety (90) days of the year in which such change is to occur. All required levels for threshold, target and high
performance for any year that are based on objective criteria of the type contained in Omega's budget will be based on Omega's
budget for the year that has been approved by the Board of Directors.
Each of the Officers will be eligible
for a prorated bonus if the Officer's employment is terminated during the year due to death. Otherwise, each of the Officers
will be eligible for a bonus only if the Officer is employed by Omega on the date the bonus is paid, except that if the term of
employment is not extended beyond December 31, 2016, the Officer will be eligible for a bonus for 2016 if he is employed by Omega
on December 31, 2016.
·
Severance
.   If the Officer's employment is terminated by Omega without cause (as defined
in the Employment Agreement) or the Officer terminates his employment for good reason (as defined in the Employment Agreement),
Omega will pay the Officer severance equal to a multiple of the sum of annual base salary plus average annual bonus payable for
the three completed fiscal years prior to his termination. The multiple and the number of years over which such severance pay will
be paid are next to each Officer's name below:
3
Pickett
3
Booth
2
Stephenson
1.5
Crabill
1.5
Ritz
1
Payment of severance is contingent
upon the Officer providing a comprehensive release to Omega. Severance will not be paid if the term of the Employment Agreement
expires, if an Officer terminates employment upon or following expiration of the term of the Employment Agreement, if the Officer
resigns without good reason or if his employment is terminated by Omega for cause.
If any payments would be subject
to the excise tax associated with parachute payments in connection with a change in control, the severance payments (and any other
payments or benefits) under any other agreements will be reduced to the maximum amount that can be paid without incurring an excise
tax, but only if that would result in the Officer retaining a larger after-tax amount.
·
Non-compete/Non-solicitation
. During the period of employment and for the potential severance
period thereafter, each Officer will be obligated not to provide managerial services or management consulting services to a competing
business (as defined in the Employment Agreement) within the states in which Omega does business. In addition, each Officer will
be prohibited during the term of the Employment Agreement and for the potential severance period thereafter from soliciting (i)
clients or customers with whom he had material contact or (ii) management level or key employees of Omega to other employers. If
the Officer remains employed by Omega through December 31, 2016, and as a result no severance is paid, then the non-compete and
non-solicitation provisions will expire at December 31, 2016.
Long-Term Incentive Compensation
Overview
As previously reported, the Compensation Committee
earlier determined to shift from its past practice of making equity grants every three years for sequential "end-to-end"
grant cycles (i.e., 2008-2010, 2011-2013) to annual grants for "rolling three-year" grant cycles (i.e., 2014-2016,
2015-2017, 2016-2018). Accordingly, rather than making a single round of equity awards for the 2014-2016 performance cycle with
no additional long-term incentive awards until 2017, the Committee determined to implement a new long-term incentive compensation
program effective January 1, 2014 with smaller annual grants than previous grants made every three years. As of November 15, 2013,
the Compensation Committee approved the grant, effective January 1, 2014, of long-term incentive compensation awards to each of
the Officers as the first grant under the new annual rolling three year long-term incentive compensation program. As of November
15, 2013, the Compensation Committee also approved the grant, effective December 31, 2013, of one-time transition awards to each
of the Officers to make up for the lost compensation opportunity that the Officers would otherwise
suffer
4
in Omega's transition in 2014 from the three-year end-to-end long-term incentive compensation program to the annual
rolling three-year long-term incentive compensation program. Each grant is subject to the Officer's continued employment
through the applicable grant date.
The number of shares of Omega common stock
issuable under the annual grants and the transition grants are based on projected aggregate accrued taxable income potentially
realizable by each Officer, rather than the estimated compensation expense to be recognized by Omega under generally accepted accounting
principles ("GAAP"). Omega expects that the compensation expense associated with the annual and transition grants under
GAAP will be substantially less than projected aggregate accrued taxable income realizable by the Officers. Projected aggregate
accrued taxable income includes projected dividends and reflects potential accrued taxable income at various levels of Omega's
performance as described below.
The significant features of the long-term incentive
compensation grants are summarized below. The descriptions of the timing of payment below assumes that the Officer has not elected
to defer receipt of the common stock or dividend equivalents under Omega's Deferred Stock Plan.
One-Time Transition Grants effective
December 31, 2013
.
The projected aggregate accrued
taxable long-term incentive compensation opportunity (including dividends) for each Officer under the one-time transition grants
of time-based restricted stock units ("RSUs") and performance restricted stock units ("PRSUs") for the
period from December 31, 2013 through December 31, 2016 is noted in the table below. The threshold, target and high levels of long-term
incentive compensation are based in part on Total Stockholder Return ("TSR") performance and Relative TSR performance
for the performance period. TSR is determined by reference to the total aggregate change in Omega's stock price per share
over the performance period plus dividends per share declared with respect to the performance period. Relative TSR means Omega's
TSR as compared to the total shareholder return reported for the MSCI U.S. REIT Index for the performance period. For calculating
TSR and Relative TSR, the starting and ending stock prices used are the November and December average closing price per share at
the beginning and the end of the performance periods.
Projected Aggregate Accrued Taxable
Compensation Opportunity
Transition Grants*
Threshold
Target
High
Pickett
$
3,598,312
$
7,425,496
$
13,558,791
Booth
$
2,113,236
$
4,076,529
$
7,276,645
Stephenson
$
1,491,260
$
3,117,939
$
5,737,421
Crabill
$
1,100,234
$
2,213,936
$
4,042,656
Ritz
$
215,215
$
440,967
$
1,213,120
*
Represents projected accrued taxable income realizable by the Officer as of December 31, 2016.
Omega's anticipated compensation expense is expected to be materially lower. See "Overview" above.
5
·
Restricted Stock Unit Awards
.     Each Officer's transition long-term incentive compensation
opportunity will consist in part of a one-time, time-based restricted stock unit award. The number of shares of Omega common stock
subject to the RSU award will be that number of shares that is projected to produce as of December 31, 2016, one-half of the taxable
compensation opportunity at target in the table immediately above. Each RSU award will be subject to three-year ratable vesting
(1/3 per year) on December 31, 2014, 2015 and 2016 and will be subject to the Officer's continued employment on the vesting
date, except in the case of death, disability, termination by Omega without cause, or resignation for good reason (a "Qualifying
Termination") in connection with a change in control (as defined in the award agreement), in which case vesting is accelerated
100%. Dividend equivalents accrue on the RSUs and will be paid currently on unvested and vested units. The number of vested RSUs
will be paid in Omega common stock upon vesting.
·
Performance Restricted Stock Unit Awards
.     The remainder of each Officer's transition
long-term incentive compensation will consist of a one-time award of PRSUs. The total number of shares of Omega common stock subject
to these PRSUs at each performance level (threshold, target and high) will be that number of shares that is projected to produce
as of December 31, 2016, an amount equal to the taxable compensation opportunity shown in the table above less the projected taxable
compensation amount attributable to the RSUs under the transition grants. Therefore, the total number of shares issued under the
PRSUs if target performance is achieved will be equal to the number of shares subject to the RSUs under the transition grant. The
total number of shares issued under the PRSUs if threshold performance is achieved will be less, and if high performance is achieved
will be more, than the number of shares subject to the RSUs under the transition grant. The PRSUs will be split into three component
grants (28.6%, 28.6% and 42.8%, respectively, of the total transition PRSU grant) relating to three different performance periods,
each starting on December 31, 2013 but ending December 31, 2014, December 31, 2015 and December 31, 2016, respectively. The number
of PRSUs that will be earned for each performance period will depend 50% on the level of absolute TSR and 50% on the level of relative
TSR achieved over the performance periods ending December 31, 2014, December 31, 2015 and December 31, 2016, respectively, as set
forth in the table below.
TSR-Based
    PRSUs
Threshold
Target
High
TSR (annualized and compounded annually)
8
%
10
%
12
%
Relative TSR-Based PRSUs
Basis Points
-300
0
+300
The number of shares earned under
the PRSUs will be determined as of the last day of each performance period. The earned PRSUs vest on the last day of the performance
period, subject to the Officer's continued employment on the vesting date, except in the case of a Qualifying Termination.
If the Qualifying Termination is not in connection with a change in control, vesting will be prorated based on days
6
elapsed through the date of the
Qualifying Termination. If the Qualifying Termination is in connection with a change in control, the performance period will end
on the date of the change in control. If the Officer is employed on the date of the change in control or has a Qualifying Termination
in connection with a change in control, depending on the level of TSR and Relative TSR as of the date of the change in control,
all, a portion or none of the PRSUs will be earned and vested on the date of the change in control.
The earned and vested PRSUs will
be paid in Omega common stock, along with dividend equivalents to be paid in cash, within ten (10) days following the last day
of the performance period or on the date of a change in control, if earlier.
Dividend equivalents declared with
respect to the applicable performance period accrue on PRSUs that subsequently vest. Accrued dividend equivalents will be paid
to the Officer at the date the shares attributable to vested PRSUs are distributable.
Annual Grants for Rolling Three-Year
Periods commencing January 1, 2014
.
Each Officer's grant effective
January 1, 2014 will be for RSUs and PRSUs that provide an opportunity to earn that number of shares of common stock of Omega over
a three year period that would produce the projected aggregate accrued taxable long-term incentive compensation opportunity (including
dividends) as of December 31, 2016 shown in the table below. Like the transition grants described above, the threshold, target
and high levels of long-term incentive compensation is based in part on Total Stockholder Return ("TSR") performance
and Relative TSR for the performance period.
Projected Aggregate Accrued Taxable
Long-term Incentive Compensation Opportunity
Annual Grants for 2014-2016 Performance
Period*
Threshold
Target
High
Pickett
$
2,056,178
$
4,243,141
$
7,747,880
Booth
$
1,207,563
$
2,329,445
$
4,158,083
Stephenson
$
849,292
$
1,781,680
$
3,278,526
Crabill
$
628,705
$
1,265,106
$
2,310,089
Ritz
$
121,550
$
251,981
$
693,211
*
Represents projected accrued taxable income realizable by the Officer as of December 31, 2016.
The Company's anticipated compensation expense is expected to be materially lower. See "Overview" above.
·
Restricted Stock Unit Awards
.   Like the transition award described above, each Officer's
annual long-term incentive compensation award will consist in part of a time-based RSU award. The number of shares of Omega common
stock subject to the RSU award will be that number of shares that is projected to produce as of December 31, 2016, one-half of
the taxable compensation amount at target in the table immediately above. Each RSU award will be subject to three-year cliff vesting
on December 31, 2016 and will be subject to the Officer's continued employment on the vesting date, except in the case of
a Qualifying Termination. If the Qualifying
7
Termination is not in connection
with a change in control, the Officer will vest in the percentage of the RSUs set forth below.
Year of Qualifying
Termination
Percentage Vested
2014
33
1
/
3
%
2015
66
2
/
3
%
2016
100
%
If the Qualifying Termination is
in connection with a change in control, vesting will be accelerated 100%. Dividend equivalents accrue on the RSU awards and will
be paid currently on unvested and vested units. The number of vested RSUs will be paid in Omega common stock upon vesting.
·
Performance Restricted Stock Unit Awards
. Like the transition grants, the remainder of each
Officer's annual long-term incentive compensation will consist of an award of PRSUs. The total number of shares of Omega
common stock subject to these PRSUs at each performance level (threshold, target and high) will be that number of shares that is
projected to produce as of December 31, 2016, an amount equal to the taxable compensation opportunity shown in the table above,
less the projected taxable compensation amount attributable to the RSUs under the annual grants. Therefore, like the transition
grants, the total number of shares issued under these PRSUs if target performance is achieved will be equal to the number of shares
subject to the RSUs under the annual grant. Similarly, the total number of shares issued under the PRSUs if threshold performance
is achieved will be less, and if high performance is achieved will be more, than the number of shares subject to the RSUs under
the annual grant. The level of PRSUs that will be earned will be based (i) 50% on the level of absolute TSR and (ii) 50% on the
level of relative TSR achieved over the three year performance period ending December 31, 2016, as set forth in the same table
that applies to the transition grants of PRSUs above.
The number of shares earned under
the PRSUs will be determined as of the last day of the performance period. 25% of the earned PRSUs will vest on the last day of
each quarter in 2017, subject to the Officer's continued employment on the vesting date, except in the case of a Qualifying
Termination. If the Qualifying Termination is not in connection with a change in control, vesting will be prorated based on days
elapsed through the date of the Qualifying Termination or will be accelerated 100% if the Qualifying Termination occurs on or after
December 31, 2016. Like the transition grants of PRSUs, if the Qualifying Termination is in connection with a change in control,
the performance period will end on the date of the change in control. If the Officer is employed on the date of the change in control
or has a Qualifying Termination in connection with a change in control, depending on the level of TSR and Relative TSR as of the
date of the change in control, all, a portion or none of the PRSUs will be earned and vested on the date of the change in control.
8
The earned and vested PRSUs will
be paid in Omega common stock, along with dividend equivalents to be paid in cash, within ten (10) days following the last day
of the performance period or on the date of a change in control, if earlier.
Dividend equivalents declared with
respect to the applicable performance period accrue on PRSUs that subsequently vest and are paid. Accrued dividend equivalents
will be paid to the Officer at the date the shares attributable to vested PRSUs are distributable.
Item 9.01          Financial
Statements and Exhibits
Number
Description
10.1
Employment Agreement, dated November 15, 2013, between Omega Healthcare Investors, Inc. and C. Taylor Pickett.
10.2
Employment Agreement, dated November 15, 2013, between Omega Healthcare Investors, Inc. and Daniel Booth.
10.3
Employment Agreement, dated November 15, 2013, between Omega Healthcare Investors, Inc. and Robert O. Stephenson.
10.4
Employment Agreement, dated November 15, 2013, between Omega Healthcare Investors, Inc. and R. Lee Crabill.
10.5
Employment Agreement, dated November 15, 2013, between Omega Healthcare Investors, Inc. and Michael Ritz.
10.6
Form of Time-Based Restricted Stock Unit Agreement for Transition Grants (2013).
10.7
Form of Performance-Based Restricted Stock Unit Agreement for Transition Grants (2013).
10.8
Form of Time-Based Restricted Stock Unit Agreement for Annual Grants (commencing 2014).
10.9
Form of Performance-Based Restricted Stock Unit Agreement for Annual Grants (commencing 2014).
9
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 thereunto duly authorized.
OMEGA HEALTHCARE INVESTORS, INC.
By:
/s/ C. Taylor Pickett
C. Taylor Pickett
President and Chief Executive Officer
Dated:  November 19, 2013
10