Good morning, and welcome to the LTC Properties Incorporated Third Quarter Analyst and Investor Call. All participants will be in listen-only mode. (Operator Instructions) After today’s presentation, there will be an opportunity to ask questions. (Operator Instruction) I’d like to remind everyone that today’s comments including the question and-answer session will include forward-looking statements. These statements are subject to risks and uncertainties that may cause actual results and events to differ materially. These risks and uncertainties are detailed in LTC properties incorporated filings with the Securities and Exchange Commission including the company’s 10-K dated December 31, 2011. Please note this event is being recorded. I would now like to turn the conference over to Wendy Simpson, CEO and President. Please go ahead.

Thank you, Loura. Hello and thank you for joining us today. The presentations today will begin with Pam Kessler, our Executive Vice President and Chief Financial Officer, who will comment on our financial results and operating and our operator coverage specifics. Pam?

Thank you, Wendy. I’m going to compare second quarter to third quarter and I’ll refer you to the 10-Q for year-over-year results. Revenues increased in the third quarter approximately 700,000 due to a $1.1 million increase in rental income due to acquisition partially offset by interest and other income decrease of 390,000 due to the receipt of 347,000 in the second quarter related to Sunwest bankruptcy settlement and a decrease in interest income resulting from the skilled health group bond redemption. Interest expense increased 984,000 due to an increase in debt outstanding during the third quarter and higher borrowing costs associated with the 85.8 million senior unsecured notes that we sold in the third quarter as compared to short-term floating rates on our line of credit. Acquisitions costs increased 64,000. Operating and other expenses decreased approximately 300,000 due to the general timing, marketing, and public company expenditures. Net income available to common shareholders decreased 611,000 due to higher interest and depreciation expense partially offset by the increased revenues resulting from acquisition. Normalized fully diluted FFO per share was $0.57 this quarter compared to $0.56 last quarter, normalized fully diluted FFO share was $0.56 this quarter and last quarter. Turning to the balance sheet, during the quarter, we acquired two 144-bed skilled nursing property in Ohio for $54 million and a 90-bed skilled nursing property in Texas for $6.5 million, both of these transactions were disclosed as subsequent event last quarter. Subsequent to September 30, we acquired a vacant parcel of land in Kansas for 730,000. Clint will discuss this transaction in a few minutes, and I will refer you to the subsequent event footnote in the 10-Q that was filed yesterday for the development funding and rental rate details. During the quarter, we invested $1.9 million in development and capital…

Thank you, Pam. Clint Malin, our Executive Vice President and Chief Investment Officer will discuss our current deal flow and pipeline.

Thank you, Wendy. 2012 has been a good year for us so far with continued growth of newer assets and development projects. As Pam mentioned, subsequent to the second quarter we closed our land acquisition in Wichita, Kansas and concurrently entered into a lease agreement making a $9.9 million investment commitment to fund construction of a two-storey 77 unit combination assisted living memory care facility. A less season affiliate of Oxford Development Holdings based in Wichita, Kansas. They currently own and operate two senior housing facilities and manage two additional facilities on a fee-per-service basis, providing assisted living and memory care services. Three of the four facilities are located in the Wichita market, so they are well versed in that local market. Senior management at oxford has extensive experience in both development and operations of senior housing facilities previously working with our four larger operating companies in the industry. This project continues to diversify our private pay assets and increases to eight, the number or properties we own on Kansas. Our pipeline is very strong and remains consistently above the $150 million mark. As expected, we have seen an up tick in deal flow in the second half of the year with a noticeable increase following the NIC Conference that was held in September. Currently, we have three letters of intent that are fully executed by LTC and other parties. We are in the process conducting due diligence on these three transactions and subject to a successful completion of due diligence and execution of definitive agreements, it is possible to close some or all three transactions by year end. We are actively negotiating LOI’s another transactions in the pipeline, which consist of unique off-market opportunities. Following seven points, we’ll provide some detail regarding the composition of our pipeline. First, the…

Thank you, Clint. Andy Stokes, our Senior Vice President of Marketing and Strategic Planning have some comments on our specific marketing efforts and what he proceeds as the broader market available to LTC. Andy?

Thanks, Wendy. What I talked to you guys about a year ago, last time I was very same (inaudible). At that time that I was, things were about as good as I had ever seen in over 20 years of doing this. And they are at least that good now. I’m still very optimistic there is a lot of churn out here. But it kind of was in 2012 banned our memory care by efforts and our development efforts and the trend that I see there has increased the availability to us in terms of having net more people, the developer, operator combination, doing underwriting, you can’t have just have a good operator, you can’t just have a good developer [in the hand both]. Sometime as a team of two, sometimes that skill resides in the same company. But we’re finding more of those, more of them are emerging, and we’re getting a little bit smarter about where to find them, it includes some of the smaller gatherings around the country, market prices for SNF over the last probably six months, I think is solvent. The newer assets continue to do well, but there is a very large stock and over much over assets, whom many knows very, very few. But and those prices seems to be weaker, and newer assets, the newer SNF assets are holding up pretty well, but that even their price is a little soft and those deals has slowed down little bit. Assisted living prices were multi-facility deals are higher and there are still some good deals available with our conservative underwriting who tend to not get as many of those unless in this special circumstance. But we do look for the special circumstance. We’re able to find some of them, independent living around the…

Thank you, Andy. In the last several weeks Pam and I have had the opportunity to visit with various current investors and potential investors. We’re listening closely to their questions, and Pam communicating very actively with our analysts to cover LTC. We’re continuing to provide more and more detailed information about our company to assist analysts and investors in their evaluations of LTC as it is now and how we’re directing our efforts to LTC’s feature. In our supplemental, we know separately show acquisition deals that total $81.7 million so far this year and development, redevelopment and expansion deals, which total about $14.6 million so far this year. The underwriting and due diligence of the $40 million of expansion and redevelopment is often more extensive and costly than the sale leaseback transactions. This well below of activity is not immediately accretive, but about $30 million of this will begin generating revenue sometime in 2013. Estimated completion dates are conservatively stated in our supplemental and I think all of the operators are hoping to open in advance of the completions we show on this schedule in the supplemental. We also provided recent photos of two construction projects already underway. We will provide additional photos on our website as these and other projects progress. Additional new information is in a pie chart on page 13 of our supplemental showing the percentage of LTC’s investments by MSA. We believe that analysts and investors have the impression that LTC’s assets were predominately rule. This chart shows that 33.1% of our assets are in the top 31 MSAs and 22% are in MSAs 32 to 100. Only 4.6% of our investments are not in an MSA, a designated MSA. And as Clint said, the transactions were working on currently are primarily within the top 40…

Certainly. (Operator Instructions) And our first question comes from James Milam of Sandler O’Neill. James Milam – Sandler O’Neill & Partners L.P.: Good morning guys. Thanks for all the extra disclosure and dialog I want to appreciate that. I guess first question just start up on your guidance commentary. I thought the prior range of 226 to 228, so when you said 225 to 228, so when you said 225 to 226 that essentially the same range, but accounting for the mortgage prepayment. Is that the right way to think about that?

That is correct. James Milam – Sandler O’Neill & Partners L.P.: Okay, thanks. And then I guess I’ll ask this one as well. You talked about potential coverage declines for the ALC leases from the 1.2 times. I think that’s a trailing 12 number from June. I’m just curious, if you have any sort of quantitative measure of how that coverage is trended through the summer?

No, we don’t. We don’t have any current information on operations from our property. James Milam – Sandler O’Neill & Partners L.P.: Okay. And then on the three letters of intent, can you give us the dollar amount for possible invested capital, and are those stabilized assets or I think Clint went over this, are they stabilized or potential development properties?

Those LOIs are both for development and stabilized acquisitions. Right now, we’re under confidentiality agreements and we’re going to due diligence self, not able to give a range right now for a transaction. But we do look at very size transactions and as we progress further and we can bring these two definitive documents and we’re in a position to go ahead and announce and then we’ll be able to go ahead and provide more detail. James Milam – Sandler O’Neill & Partners L.P.: Okay. And I guess just one last quick one. There was a potential $10 million SNF disposition before the end of year. Do you guys have an update on the status there?

We talked to the tenants and they are actively working on find new financing to exercise the option. They’ve given us the impression that I think going to be like them not exactly sure what date that will be but they have until March 31 to accomplish that. James Milam – Sandler O’Neill & Partners L.P.: Okay.

But right now, we haven’t received any request to get the documents together for any legal, okay. James Milam – Sandler O’Neill & Partners L.P.: Okay.

So it’s unlikely it will happen before year-end. James Milam – Sandler O’Neill & Partners L.P.: Got it. Perfect. Okay, thank you guys. I appreciate it.

Thank you, James.

And our next question is from Karin Ford of KeyBanc Capital. Karin Ford – KeyBanc Capital Markets: Hi, good morning. I wanted to ask you about on ALC and the Board’s decision to pursue strategic alternatives have they been in touch with you guys about participating in that? Would you be willing to if they did? And have you had discussions with other operators on potentially taking the portfolio over?

We’ve had no further discussions with any other operators. We’ve had some earlier in the year when Assisted Living Concepts first announced they were changing management. We had no discussions with Assisted Living Concepts about adding our properties into any disposition. We’re not interested right now in selling any of our Assisted Living Properties. We would be more inclined to find new operators, if they were going to make those available under the lease. But they haven’t asked and we haven’t reached out to say please consider ours in your disposition packages. Karin Ford – KeyBanc Capital Markets: Okay, thanks. And if you were going to transition those properties, what would a market coverage level be for a new operator today?

But we’re looking at underwriting at 1.2, aren’t we?

1.2, 1.3 somewhere in that neighborhood. Karin Ford – KeyBanc Capital Markets: Okay.

Pushing out the factor in the consideration of being in lease up depending on how stabilized the assets are so. Karin Ford – KeyBanc Capital Markets: Right. So you might get a lower rent for an initial period and then higher rent post lease up?

It would all depend on the circumstances, I think. I mean, I don’t see having to give. Our hope is to find companies that can go ahead and if occupancy has not been increased starting through ALC is to find companies that know the markets are able to go ahead and achieve ramp ups on the occupancy. So I wouldn’t say that we would go ahead initially with lower rent that’s not our initial expectation. Karin Ford – KeyBanc Capital Markets: Okay.

I go out to the world I routinely get people asking me saying to me I say routinely triple times in the last six months with different companies that are fairly substantial. If you get any of those back I would like to rent, I would like to lease them. And these would be fairly knowledgeable companies you see a little more company. But we do get those increase, it's just been, I mentioned Wendy, certainly it’s preliminary for me to be pursuing it through them. Karin Ford – KeyBanc Capital Markets: Okay, thanks. And then it’s fully, if you were to consider doing something like that, it would fully be under a new triple net lease, would you consider everyday a transaction on those properties or not?

I think that right now it seems like we have a decent opportunity to do a triple net lease. Karin Ford – KeyBanc Capital Markets: Okay.

If for some reason that was a possible and it was going to be beneficial to our shareholders to enter into idea, we might do that, but that’s not our first strategy. Karin Ford – KeyBanc Capital Markets: Okay. And last question, it sounds like from your comments that you're focused on increasing private pay and increasing the assisted living portion of the portfolio. Just talk about, has the pipeline moved to more towards assisted living today and what’s the split and the stuff you’re looking at between ALF and SNF?

The majority of the stuff we are looking at right now is ALF. It’s the deal flow. There is no standard, sometimes you have an opportunity, another times you don’t, but right now, we’ve got an opportunity to do some creative investments in assisted living properties and memory care properties that are already open and operating. So it would be, they would be sale leaseback transaction. Karin Ford – KeyBanc Capital Markets: What do you think is driving the increased seller willingness on the outside increased volume and deals better?

Taxes. Karin Ford – KeyBanc Capital Markets: Yeah, okay. Great, thank you very much.

And the next question comes from Rich Anderson of BMO Capital Markets. Richard Anderson – BMO Capital Markets: Hey, thanks, good morning.

Hi, Rich. Richard Anderson – BMO Capital Markets: So I guess the first question is from the previous question, you said you didn’t have any information on how the summer went for your portfolio. And I guess that made me feel uncomfortable. Can you have sort of guess of what will happen to coverages with the full effect of the CMS cuts in the numbers at that point?

Rich, we’ve been receding that we get quarterly financial statements on those, so we’ve got the last quarterly statements, we’ve annualized those through June and as those other statements come in we’ll continue to annualize those. I mean we are constantly in contact with our larger operators and talking to them about anything they see on the horizon whether from a state perspective or federal perspective. So we’re actively engaged with operators monitoring that, but we typically review that on a quarterly basis.

And we’re still projecting at 1.9, Rich, I think for the past nine months, I’ve been close through projecting about, it will shake out to be about a 1.9 on a same portfolio basis. Richard Anderson – BMO Capital Markets: But that compares to, am I looking at this right, 1.83 for the second quarter?

What you are looking at on the top part is the portfolio that includes new properties, so properties that we have bought recently at a 1.5 coverage drive your overall portfolio coverage down. But if you look down below where we isolate the rugs quarter-by-quarter, that is a stabilized same portfolio basis as like we’d say the core portfolio without acquisition. Richard Anderson – BMO Capital Markets: Okay.

That’s going to be at 1.9. Richard Anderson – BMO Capital Markets: Okay, great, fair enough.

And also Rich we started to receive the third quarter financial statements that we don’t have all those, but we are actively working on improving those for our additional updated analysis. So we do actively and we are monitoring it. Richard Anderson – BMO Capital Markets: Okay.

The companies have 45 days on quarter end to get us their financials so that’s why we just usually have them all in time for this call. Richard Anderson – BMO Capital Markets: Okay. And it’s a bigger picture question on memory care and just thinking that the product through standalone memory care. What is it about that that appeals to you so much, because when I think about it, memory care has a wing or on an – facility kind of has a feeder element to it, where this standalone product does not. So it seems like it’s more vulnerable to turn over and the rest I’m just curious what is it about memory care fundamentally that appeals to you?

Right now, the demand the unmet demand is significant if you talk you go out and look and talked to operators, the units of assisted living that have provide memory care are almost 100% full. If you don’t necessarily transition from assisted living into memory care, you very often have directed machines to memory care as a memory care patient and assisted living don’t often admit from outside, they keep their units for the transition people, so the market is underserved right at the moment for memory care. It’s all private pay. There are smaller properties. There is a somewhere between 60 unit and 80 unit properties. So there is 120 unit property that’s very costly to buy that’s what I see and Clint may give some more comments about memory care.

I think those are spot on. Richard Anderson – BMO Capital Markets: Okay.

This is Andy, Rich. I think we have to think about the decision maker, decision maker for taking care on mom or dad, wants them to go some place nice and this product is increasingly acceptable. 20 years ago nobody knew what assisted living was and it became acceptable. The standalone memory care has a place in marketing to up market folks have a lot of money. And when they are done and when they marketed correctly, they’re saying you don’t want to send mom over there, we know how to really take care over here and we have a building that is designed to add to her comfort and experience and it works. So it’s really much, I think it’s more at the market side, why these are good investments and they are.

And I guess also the added leverage is the focus and they dedicated reasoning memory care facility is the staffing ratios and the program is targeted specifically for a care of a certain population of resident, where as in combination facility or assisted living memory care, there are two different programs affectively came into two different population. So this is the dedicated focus on that diagnosis. Richard Anderson – BMO Capital Markets: Okay. And maybe a last question for you Clint. Have you noticed or anybody I should say, have you noticed or you sensing that existing owners of real estate or operators were anticipating and hoping for Obama Win. And do you think that will have any influence on your pipeline as you now have some clarity about Obamacare and the healthcare delivery system in general?

I think people were anticipating that Obamacare was going to survive and so our operators have an indicated, our SNF operators have an indicated any significant concerns about the implementation of all the provisions of Obamacare. In terms of providing service at the lowest cost level that that is still the SNF profile. So we haven’t had any indication that our operators are concerned about their revenue. I guess it’s a little too early to determine whether there is going to be any more deal flow from it. We haven’t noticed it in a couple of days. Richard Anderson – BMO Capital Markets: Okay. Fair enough. Thank you.

Thank you, Rich.

And our next question is from Michael Carroll of RBC Capital Markets. Michael Carroll – RBC Capital Markets, LLC: Good morning guys. Has there been any progress on potentially negotiating in early termination of some of the ALC properties?

We haven’t tried to negotiate in early termination of the ALC properties. Any negotiation that we would – I mean if we opened it up, they would assume we are willing to take some lesser amount in order to get out from underneath this lease. We’re very comfortable that we are going to get everything that we’re entitled to under this lease. And at the end of this lease we’ll have the assets that will provide at least the same amount of lease stream if not more. So I don’t see that there is a benefit to our shareholders and our company of negotiating an early termination of this lease other than uncertainty in the marketplace, which I think is over heated. Michael Carroll – RBC Capital Markets, LLC: Okay, can you talk about a little bit about your mortgage book? Are there any additional investment opportunities out there?

Mortgages?

Okay, are you talking about – initiating about new mortgages?

Yeah.

We occasionally see opportunities…

We’re talking about doing the short-term one right now as linked to HUD.

So we’re looking at unique opportunities, but as a general line of business and going out looking for mortgages with the rates that are available through the agencies in HUD, it’s hard for us to compete. For those other than unique opportunities, I would say it’s not a big part what we’re looking for?

This is Andy. In terms of the charter and I have been given, my merging orders are go up into leasing. And we can do more mortgages. But our objective is somebody started out with, I’d like to do mortgage and we want to listen to them and see if we can need any with lease to service better and mortgages. And we from time-to-time will make a mortgage for specific reasons. We mentioned earlier that we’re going to started out with one assets, which has a little bit of turnaround risk, we’re going to start with the mortgage, so they have to pay a stock and if it does okay, then we’ll exercise of option things by it. That’s the kind of circumstance, but I think in my individual...

We also can look at doing a mortgage. We’re looking at some development project, but we do a mortgage as I mentioned in my comments, we have an option to purchase that would be a unique opportunity where we would look at a mortgage. Michael Carroll – RBC Capital Markets, LLC: Okay. And then do you still expect that you can have about $30 million of development starts the year, is that’s your goal and you better reach those?

It’s $30 million to $50 million per year. Michael Carroll – RBC Capital Markets, LLC: Okay, great. Thanks.

Thanks Mike.

And our next question comes from Daniel Bernstein of Stifel Nicolaus. Daniel Bernstein – Stifel Nicolaus: Good morning.

Hi, Dan. Daniel Bernstein – Stifel Nicolaus: Hi, I know you don’t want to have anymore ALC questions, but this is one may not be too bad. The lease with ALC is put between the master lease I and master lease II. Is there any difference between lease coverage on those two pools?

Yeah. Daniel Bernstein – Stifel Nicolaus: And reason why I ask is that the covenant that’s being violated is leverage covenants. So if there is anything that’s below one or even individual assets sort of pools then maybe you have a little bit of leverage to negotiate at lease, the early termination of at lease, you have to give up any thing?

Perhaps, I don’t understand that theory. Daniel Bernstein – Stifel Nicolaus: Well, if you have any individual assets that are lease to them that are not positive EBITDA, if they gave it back to you, it help them in your covenant?

It helps them in the covenants. Daniel Bernstein – Stifel Nicolaus: Yeah.

On both leases cover EBITDARM, so they’re making a management fee. There are one portfolio covers one time after 5% fees to EBITDAR that’s the portfolio that has the lower occupancy, the Pacific Northwest portfolio that we talked about. The other portfolio kind of in the Midwest, which also includes the New Jersey property, it covers 1.5 times after a 5% fee. Daniel Bernstein – Stifel Nicolaus: Okay.

So, I don’t think they would want a give up either a fees. Daniel Bernstein – Stifel Nicolaus: Right, as long as you’re getting positive EBITDA and it helps their covenant issue?

Right. Daniel Bernstein – Stifel Nicolaus: Okay. I’ll move on from them. And then have you spoken in NHI at all lately about converting their preferred, I mean given the capital gains stakes maybe going up. They may need capital at some point. Have you spoken to them about the preferred it all?

We have not. Daniel Bernstein – Stifel Nicolaus: Okay. Have you any concerns about sequestration being higher than people are expecting. I heard all kinds of different roomers in the last couple of days with the fiscal cliff that people worried about sequestration been higher and that’s true and have you any concerns from your operators at all about the fiscal cliff or anything not just Obamacare, but the fiscal cliff or any other issues that are concern to them.

Hi, Dan, this is Clint. I’m actively in conversation with our operators on a routine basis and that is something right now they have not stressed any significant concerns about. Daniel Bernstein – Stifel Nicolaus: Okay.

Also within our portfolio, our SNF coverage is pretty strong. So they have the ability within our assets to whether any cuts on that. But hasn’t even as it relates to existing portfolios that they have – they’ve not stress any concern to me, specifically, about and showing some back of their mind, but has it been on forefront of issues they’re raising to me. Daniel Bernstein – Stifel Nicolaus: Okay.

Andy, do you got seeing anything different?

I think the most common concern, say the last couple of launches and that’s progress about (inaudible) some states. Daniel Bernstein – Stifel Nicolaus: Okay, okay.

And that’s kind of what they talk about in a positive way they are sick of the regulations. And they are not looking forward to more regulation.

Yeah. Daniel Bernstein – Stifel Nicolaus: Okay.

Let me show vote it differently. There was way to (inaudible) that. Daniel Bernstein – Stifel Nicolaus: I was going to (inaudible) okay. I think that’s all from my side. Thank you very much.

Thank you, Dan. Daniel Bernstein – Stifel Nicolaus: All right.

And next we have question from Todd Stender of Wells Fargo. Todd Stender – Wells Fargo Securities, LLC: Hi, good morning guys.

Hi, Todd. Todd Stender – Wells Fargo Securities, LLC: The length of the lease on a (inaudible) development project, it seems on a shorter side, I guess it taking only 10 years. Are you seeing anything, any migration to shorter lease terms in general…?

In this case they’re expecting to like a construction commenced the day following the acquisition. So they think they’re going to have that building up and operational. I think before January 2014, which is the estimated completion date. So no, I’m not seeing any migration towards shorter-term leases.

Absolutely, it’s pretty longer.

Yeah, we want now for an opportunity to reassess the rate. So…

My sense is 10 years is standard.

Yeah. Todd Stender – Wells Fargo Securities, LLC: Not 15?

Our industry within our…

Not 15. Not…

15 would be very unique, leased within our portfolio. Todd Stender – Wells Fargo Securities, LLC: Okay. That’s helpful. And just look at the rent stats if you can give us maybe what some of the monthly rents are for AL in which Utah market and how they compare to say what you are doing in Colorado and Texas and then where is your overall portfolio?

Sure. Well, which Utah market is a little different than the Denver market, the rates are definitely a little bit lower on the…

Our projected rates are you talking about…

The projected rates on which Utah market...

Right. Todd Stender – Wells Fargo Securities, LLC: That’s right.

Is that’s why you are asking or is that program. Todd Stender – Wells Fargo Securities, LLC: Yes, I am.

Okay. You are asking what the operator is going to charge. Okay.

Sure. On a blended basis there are $5,000 for the company or the average rate between AL and memory care including services. So this property skewed more towards AL and in this memory care. So looking probably more in the $5,200 on the memory care side and more on the low force, right on the fore mark on the assisted living side. Todd Stender – Wells Fargo Securities, LLC: And how about in Colorado and Texas?

Colorado, we’re looking at memory care. The properties in Colorado we’re looking at are…

All memory care…

All memory care, so we’re looking probably in the $5,500 to $6,000 per month range on the memory care side in Colorado.

And then in Texas?

Texas is a little bit lower, probably in the market we’re looking at, some more in line probably with which Utah market. Todd Stender – Wells Fargo Securities, LLC: Okay, thanks Clint. And just staying with you Clint you gave some coverage numbers before about 1:2 to 1:3, were those reflective of only assisted living, or is that?

The assisted living on stabilized assisted living. Todd Stender – Wells Fargo Securities, LLC: If you’re talking in memory care, does that change of the number at all?

Well, there is not a lot of existing operational memory care facility that we’ve looked at. So, we would view that as private pay housing similar to assisted living. So we’d probably look at it somewhat similar.

But we’re projecting a stabilized memory care to cover.

And I am looking at but 1.5 time on our development projects. Todd Stender – Wells Fargo Securities, LLC: After 5% management fee?

Of course, after 5%. Todd Stender – Wells Fargo Securities, LLC: Okay, thank you very much.

Thank you.

And next we have a question from John Roberts of Hilliard Lyons. John Roberts – Hilliard Lyons: Hey, Wendy.

Hi, John. John Roberts – Hilliard Lyons: Most of my questions have been answered. But I do an eco thanks for the additional information on the supplemental, very helpful? Can you talk maybe a little bit about operating in other expenses going forward? Q3 seem to come down a bit, I was wondering which we’re looking at going in the future?

I think we’re – if you took our year-to-date and divided by three it’s probably what we’re going to be doing in the future. I think we have what we budgeted for the year?

I think we are running to start about $2.6 million.

$2.6 million?

Yeah. John Roberts – Hilliard Lyons: It come it about little over $2.1 million?

Yeah. We add this quarter was low. Marketing expenditures in the summer time typically there is not many conference, there is just not a lot going on. So marketing is quite seasonal. I will expected to pick up hear in the fourth quarter. But I think our run rates as been about $2.6 million. John Roberts – Hilliard Lyons: Okay, great. And Pam, you reserve organized on your presentation I was (inaudible) down that so quickly, did you say that you recognize some more Sunwest income this quarter?

We had last quarter and that’s why other income went down this quarter, we had that, yeah. John Roberts – Hilliard Lyons: Okay, all right.

Thank you. John Roberts – Hilliard Lyons: Yeah maybe add last quarter, but I’ll tell you, SNF went down stuff so quickly, I missed it (inaudible) this quarter or last quarter. Okay, great. That’s all I had, thanks.

Thank you, John.

(Operator Instruction) And our next question comes from James as a follow-up from James Milam of Sandler O'Neill. James Milam – Sandler O'Neill & Partners L.P.: Hey, guys. I just wanted to make sure I understood that last question on operating and other expenses. Does the 26 number include transaction costs and everything else in there?

No, it does not. James Milam – Sandler O'Neill & Partners L.P.: Okay. So that’s I guess just looking back, it looks like it was 25, 24, 22 for quarters one, two, and three, and you are saying the fourth quarter of next year is around 26?

Yeah, and going forward, I’m kind of projecting into 2013 for you guys, I think if you have good run rate. James Milam – Sandler O'Neill & Partners L.P.: Okay, perfect. And then my last one Pam, you or I guess you guys are talking are talking about next year expanding a line of credit and doing more funding on the line of credit rather than drawing on the unsecured shelf agreements. We just talk about, I guess to me that sounds like a little bit of a shift in the strategy. Is that more timing related, or is there a preference there for using a line of credit more?

I think it’s reflective of the development strategy as we start to fund the development, it’s more accretive to keep that on the line short-term and then as you get closer to CFO and it switches to being revenue producing then term it out. James Milam – Sandler O'Neill & Partners L.P.: Okay, that makes sense. Thank you.

Welcome.

(Operator Instruction) Showing no further questions, this concludes our Q&A session. I would like to turn the conference back over to management for any closing remarks.

Thank you. Thank you, Loura and thanks everyone for participating today. And if you have any follow-up questions, please give us a call and we’ll try to give you additional answers. Again thank you and we’ll talk to you in January, all right, February. Okay, thank a lot. Bye-bye.

The conference is now concluded. Thank you for attending today’s presentation. You may now disconnect.