Condensed Consolidating Financial Statements

A portion of our subsidiaries have guaranteed the Company’s indebtedness under the Company's unsecured senior notes, unsecured revolving credit facility and unsecured term loan facility. The guarantees are joint and several, full and unconditional and subject to customary release provisions. The following summarizes the Company’s condensed consolidating information as of December 31, 2013 and 2012 and for the years ended December 31, 2013, 2012 and 2011 (in thousands):

Condensed Consolidating Balance Sheet As of December 31, 2013

	EPR Properties (Issuer)		Wholly Owned Subsidiary Guarantors		Non- Guarantor Subsidiaries		Consolidated Elimination			Consolidated
Assets
Rental properties, net	$	—	$	1,341,770	$	762,381	$	—		$	2,104,151
Land held for development	—		—		201,342		—			201,342
Property under development	18		77,283		12,172		—			89,473
Mortgage notes and related accrued interest receivable, net	—		460,533		25,804		—			486,337
Investment in a direct financing lease, net	—		242,212		—		—			242,212
Investment in joint ventures	—		—		5,275		—			5,275
Cash and cash equivalents	449		705		6,804		—			7,958
Restricted cash	1,150		6,735		1,829		—			9,714
Deferred financing costs, net	17,221		5,439		684		—			23,344
Accounts receivable, net	106		22,555		19,877		—			42,538
Intercompany notes receivable	—		—		175,757		(175,757		)	—
Investments in subsidiaries	2,852,543		—		—		(2,852,543		)	—
Other assets	19,292		5,725		34,915		—			59,932
Total assets	$	2,890,779	$	2,162,957	$	1,246,840	$	(3,028,300	)	$	3,272,276
Liabilities and Equity
Liabilities:
Accounts payable and accrued liabilities	$	43,589	$	19,793	$	8,945	$	—		$	72,327
Dividends payable	19,553		—		—		—			19,553
Unearned rents and interest	—		13,528		3,518		—			17,046
Intercompany notes payable	—		—		175,757		(175,757		)	—
Debt	1,140,000		—		335,336		—			1,475,336
Total liabilities	1,203,142		33,321		523,556		(175,757		)	1,584,262
EPR Properties shareholders’ equity	1,687,637		2,129,636		722,907		(2,852,543		)	1,687,637
Noncontrolling interests	—		—		377		—			377
Equity	$	1,687,637	$	2,129,636	$	723,284	$	(2,852,543	)	$	1,688,014
Total liabilities and equity	$	2,890,779	$	2,162,957	$	1,246,840	$	(3,028,300	)	$	3,272,276

Condensed Consolidating Balance Sheet As of December 31, 2012

	EPR Properties (Issuer)		Wholly Owned Subsidiary Guarantors		Non- Guarantor Subsidiaries		Consolidated Elimination			Consolidated
Assets
Rental properties, net	$	—	$	1,113,658	$	771,435	$	—		$	1,885,093
Rental properties held for sale, net	—		—		2,788		—			2,788
Land held for development	—		—		196,177		—			196,177
Property under development	—		25,419		3,957		—			29,376
Mortgage notes and related accrued interest receivable, net	—		414,075		41,677		—			455,752
Investment in a direct financing lease, net	—		234,089		—		—			234,089
Investment in joint ventures	7,250		—		4,721		—			11,971
Cash and cash equivalents	1,531		651		8,482		—			10,664
Restricted cash	—		9,715		14,276		—			23,991
Deferred financing costs, net	13,563		4,812		1,304		—			19,679
Accounts receivable, net	139		16,830		21,769		—			38,738
Intercompany notes receivable	103,104		—		4,147		(107,251		)	—
Investments in subsidiaries	2,231,079		—		—		(2,231,079		)	—
Other assets	21,482		3,956		12,974		—			38,412
Total assets	$	2,378,148	$	1,823,205	$	1,083,707	$	(2,338,330	)	$	2,946,730
Liabilities and Equity
Liabilities:
Accounts payable and accrued liabilities	$	37,441	$	16,662	$	11,378	$	—		$	65,481
Dividends payable	41,186		—		—		—			41,186
Unearned rents and interest	—		7,393		3,940		—			11,333
Intercompany notes payable	—		—		107,251		(107,251		)	—
Debt	840,000		53,315		475,517		—			1,368,832
Total liabilities	918,627		77,370		598,086		(107,251		)	1,486,832
EPR Properties shareholders’ equity	1,459,521		1,745,835		485,244		(2,231,079		)	1,459,521
Noncontrolling interests	—		—		377		—			377
Equity	$	1,459,521	$	1,745,835	$	485,621	$	(2,231,079	)	$	1,459,898
Total liabilities and equity	$	2,378,148	$	1,823,205	$	1,083,707	$	(2,338,330	)	$	2,946,730

Condensed Consolidating Statement of Income For the Year Ended December 31, 2013

	EPR Properties (Issuer)			Wholly Owned Subsidiary Guarantors			Non- Guarantors Subsidiaries			Consolidated Elimination			Consolidated
Rental revenue	$	—		$	153,335		$	95,374		$	—		$	248,709
Tenant reimbursements	—			1,853			16,548			—			18,401
Other income	75			2			1,605			—			1,682
Mortgage and other financing income	994			69,327			3,951			—			74,272
Intercompany fee income	2,629			—			—			(2,629		)	—
Interest income on intercompany notes receivable	17,848			—			386			(18,234		)	—
Total revenue	21,546			224,517			117,864			(20,863		)	343,064
Equity in subsidiaries’ earnings	212,634			—			—			(212,634		)	—
Property operating expense	(88		)	6,694			19,410			—			26,016
Intercompany fee expense	—			—			2,629			(2,629		)	—
Other expense	—			—			658			—			658
General and administrative expense	—			16,612			9,001			—			25,613
Costs associated with loan refinancing or payoff	—			188			5,978			—			6,166
Gain on early extinguishment of debt	—			(4,539		)	—			—			(4,539		)
Interest expense, net	55,856			1,733			23,467			—			81,056
Interest expense on intercompany notes payable	—			—			18,234			(18,234		)	—
Transaction costs	1,813			—			142			—			1,955
Depreciation and amortization	1,093			31,447			21,406			—			53,946
Income before equity in income from joint ventures and other items	175,506			172,382			16,939			(212,634		)	152,193
Equity in income from joint ventures	505			—			893			—			1,398
Gain on sale or acquisition, net	(150		)	—			3,167			—			3,017
Gain on previously held equity interest	4,853			—			—			—			4,853
Income before income taxes	180,714			172,382			20,999			(212,634		)	161,461
Income tax benefit (expense)	(488		)	—			14,664			—			14,176
Income from continuing operations	180,226			172,382			35,663			(212,634		)	175,637
Discontinued operations:
Income (loss) from discontinued operations	—			638			(305		)	—			333
Gain on sale or acquisition of real estate	—			—			4,256			—			4,256
Net income attributable to EPR Properties	180,226			173,020			39,614			(212,634		)	180,226
Preferred dividend requirements	(23,806		)	—			—			—			(23,806		)
Net income available to common shareholders of EPR Properties	$	156,420		$	173,020		$	39,614		$	(212,634	)	$	156,420
Comprehensive income attributable to EPR Properties	$	176,797		$	173,120		$	38,692		$	(211,812	)	$	176,797

Condensed Consolidating Statement of Income For the Year Ended December 31, 2012

	EPR Properties (Issuer)			Wholly Owned Subsidiary Guarantors			Non- Guarantor Subsidiaries			Consolidated Elimination			Consolidated
Rental revenue	$	—		$	140,635		$	93,882		$	—		$	234,517
Tenant reimbursements	—			1,650			16,925			—			18,575
Other income	93			(3		)	648			—			738
Mortgage and other financing income	494			60,089			3,394			—			63,977
Intercompany fee income	2,706			—			—			(2,706		)	—
Interest income on intercompany notes receivable	16,967			—			353			(17,320		)	—
Total revenue	20,260			202,371			115,202			(20,026		)	317,807
Equity in subsidiaries’ earnings	137,443			—			—			(137,443		)	—
Property operating expense	—			4,860			20,055			—			24,915
Intercompany fee expense	—			—			2,706			(2,706		)	—
Other expense	—			4			1,378			—			1,382
General and administrative expense	—			14,555			8,615			—			23,170
Costs associated with loan refinancing or payoff	—			477			150			—			627
Interest expense, net	35,240			11,645			29,771			—			76,656
Interest expense on intercompany notes payable	—			—			17,320			(17,320		)	—
Transaction costs	404			—			—			—			404
Impairment charges	—			—			3,074			—			3,074
Depreciation and amortization	1,039			25,529			20,130			—			46,698
Income before equity in income from joint ventures and other items	121,020			145,301			12,003			(137,443		)	140,881
Equity in income from joint ventures	536			—			489			—			1,025
Income from continuing operations	$	121,556		$	145,301		$	12,492		$	(137,443	)	$	141,906
Discontinued operations:
Income (loss) from discontinued operations	—			(2		)	622			—			620
Impairment charges	—			—			(20,835		)				(20,835		)
Gain on sale or acquisition of real estate	—			282			(309		)	—			(27		)
Net income (loss)	121,556			145,581			(8,030		)	(137,443		)	121,664
Add: Net loss attributable to noncontrolling interests	—			—			(108		)	—			(108		)
Net income (loss) attributable to EPR Properties	121,556			145,581			(8,138		)	(137,443		)	121,556
Preferred dividend requirements	(24,508		)	—			—			—			(24,508		)
Preferred share redemption costs	(3,888		)	—			—			—			(3,888		)
Net income (loss) available to common shareholders of EPR Properties	$	93,160		$	145,581		$	(8,138	)	$	(137,443	)	$	93,160
Comprehensive income (loss) attributable to EPR Properties	$	118,715		$	145,504		$	(7,054	)	$	(138,450	)	$	118,715

Condensed Consolidating Statement of Income For the Year Ended December 31, 2011

	EPR Properties (Issuer)			Wholly Owned Subsidiary Guarantors			Non- Guarantor Subsidiaries			Consolidated Elimination			Consolidated
Rental revenue	$	—		$	126,809		$	92,924		$	—		$	219,733
Tenant reimbursements	—			1,778			16,187			—			17,965
Other income	94			8			272			—			374
Mortgage and other financing income	416			54,689			459			—			55,564
Intercompany fee income	2,726			—			—			(2,726		)	—
Interest income on intercompany notes receivable	16,665			—			2,365			(19,030		)	—
Total revenue	19,901			183,284			112,207			(21,756		)	293,636
Equity in subsidiaries’ earnings	111,301			—			—			(111,301		)	—
Property operating expense	—			4,028			20,176			—			24,204
Intercompany fee expense	—			—			2,726			(2,726		)	—
Other expense	—			21			1,592			—			1,613
General and administrative expense	—			12,491			7,682			—			20,173
Costs associated with loan refinancing or payoff, net	—			—			1,877			—			1,877
Interest expense, net	20,069			20,425			30,801			—			71,295
Interest expense on intercompany notes payable	—			—			19,030			(19,030		)	—
Transaction costs	1,403			—			324			—			1,727
Impairment charges	—			—			2,531			—			2,531
Depreciation and amortization	1,062			22,163			19,750			—			42,975
Income before equity in income from joint ventures and other items	108,668			124,156			5,718			(111,301		)	127,241
Equity in income from joint ventures	2,805			—			42			—			2,847
Income from continuing operations	$	111,473		$	124,156		$	5,760		$	(111,301	)	$	130,088
Discontinued operations:
Interest income on intercompany notes receivable	3,755			—			—			(3,755		)	—
Interest expense on intercompany notes payable	—			(3,755		)	—			3,755			—
Income from discontinued operations	—			1,888			1,391			—			3,279
Impairment charges	—			—			(33,525		)				(33,525		)
Costs associated with loan refinancing	—			—			(4,121		)	—			(4,121		)
Gain on sale or acquisition of real estate	—			19,530			15			—			19,545
Net income (loss)	115,228			141,819			(30,480		)	(111,301		)	115,266
Add: Net loss attributable to noncontrolling interests	—			—			(38		)	—			(38		)
Net income (loss) attributable to EPR Properties	115,228			141,819			(30,518		)	(111,301		)	115,228
Preferred dividend requirements	(28,140		)	—			—			—			(28,140		)
Preferred share redemption costs	(2,769		)	—			—			—			(2,769		)
Net income (loss) available to common shareholders of EPR Properties	$	84,319		$	141,819		$	(30,518	)	$	(111,301	)	$	84,319
Comprehensive income (loss) attributable to EPR Properties	$	118,499		$	143,470		$	(28,897	)	$	(114,573	)	$	118,499

Condensed Consolidating Statement of Cash Flows For the Year Ended December 31, 2013

	EPR Properties (Issuer)			Wholly Owned Subsidiary Guarantors			Non-Guarantor Subsidiaries			Consolidated
Intercompany fee income (expense)	$	2,629		$	—		$	(2,629	)	$	—
Interest income (expense) on intercompany receivable/payable	17,848			—			(17,848		)	—
Net cash provided (used) by other operating activities	(38,183		)	197,152			72,470			231,439
Net cash provided (used) by operating activities	(17,706		)	197,152			51,993			231,439
Net cash provided by operating activities of discontinued operations	—			286			2,395			2,681
Net cash provided (used) by operating activities	(17,706		)	197,438			54,388			234,120
Investing activities:
Acquisition of rental properties and other assets	(1,358		)	(94,119		)	(28,020		)	(123,497		)
Proceeds from sale of real estate	—			—			797			797
Investment in unconsolidated joint ventures	(1,607		)	—			—			(1,607		)
Investment in mortgage notes receivable	(11,797		)	(46,402		)	(2,369		)	(60,568		)
Proceeds from mortgage note receivable paydown	—			202			1,698			1,900
Investment in promissory notes receivable	—			(1,278		)	—			(1,278		)
Proceeds from promissory note paydown	117			—			910			1,027
Investment in a direct financing lease, net	—			(3,262		)	—			(3,262		)
Additions to property under development	(18		)	(189,736		)	(7,517		)	(197,271		)
Investment in intercompany notes payable	103,104			—			(103,104		)	—
Advances to subsidiaries, net	(386,759		)	188,458			198,301			—
Net cash provided (used) by investing activities of continuing operations	(298,318		)	(146,137		)	60,696			(383,759		)
Net proceeds from sale of real estate from discontinued operations	—			—			47,301			47,301
Net cash provided (used) by investing activities	(298,318		)	(146,137		)	107,997			(336,458		)
Financing activities:
Proceeds from debt facilities	300,000			346,000			—			646,000
Principal payments on debt	—			(394,740		)	(157,728		)	(552,468		)
Deferred financing fees paid	(5,620		)	(2,494		)	(19		)	(8,133		)
Costs associated with loan refinancing or payoff (cash portion)	—			—			(5,790		)	(5,790		)
Net proceeds from issuance of common shares	220,785			—			—			220,785
Impact of stock option exercises, net	947			—			—			947
Purchase of common shares for treasury	(3,246		)	—			—			(3,246		)
Dividends paid to shareholders	(197,924		)	—			—			(197,924		)
Net cash provided (used) by financing	314,942			(51,234		)	(163,537		)	100,171
Effect of exchange rate changes on cash	—			(13		)	(526		)	(539		)
Net increase (decrease) in cash and cash equivalents	(1,082		)	54			(1,678		)	(2,706		)
Cash and cash equivalents at beginning of the period	1,531			651			8,482			10,664
Cash and cash equivalents at end of the period	$	449		$	705		$	6,804		$	7,958

Condensed Consolidating Statement of Cash Flows For the Year Ended December 31, 2012

	EPR Properties (Issuer)			Wholly Owned Subsidiary Guarantors			Non-Guarantor Subsidiaries			Consolidated
Intercompany fee income (expense)	$	2,706		$	—		$	(2,706	)	$	—
Interest income (expense) on intercompany receivable/payable	16,967			—			(16,967		)	—
Net cash provided (used) by other operating activities	(19,940		)	164,505			51,536			196,101
Net cash provided (used) by operating activities of continuing operations	(267		)	164,505			31,863			196,101
Net cash provided by operating activities of discontinued operations	—			1,036			10,307			11,343
Net cash provided (used) by operating activities	(267		)	165,541			42,170			207,444
Investing activities:
Acquisition of rental properties and other assets	(422		)	(67,890		)	(4,876		)	(73,188		)
Investment in unconsolidated joint ventures	(1,800		)	—			—			(1,800		)
Investment in mortgage note receivable	—			(90,975		)	(22,848		)	(113,823		)
Proceeds from sale of investment in a direct financing lease, net	—			4,494			—			4,494
Additions to property under development	—			(99,924		)	(13,675		)	(113,599		)
Investment in intercompany notes payable	(3,074		)	—			3,074			—
Advances to subsidiaries, net	(416,859		)	445,612			(28,753		)	—
Net cash provided (used) by investing activities of continuing operations	(422,155		)	191,317			(67,078		)	(297,916		)
Net proceeds from sale of discontinued operations	—			282			41,851			42,133
Net cash provided (used) in investing activities	(422,155		)	191,599			(25,227		)	(255,783		)
Financing activities:
Proceeds from debt facilities	590,000			281,000			—			871,000
Principal payments on debt	—			(638,684		)	(19,887		)	(658,571		)
Deferred financing fees paid	(5,770		)	(6		)	(24		)	(5,800		)
Costs associated with loan refinancing or payoff (cash portion)	—			(37		)	(152		)	(189		)
Net proceeds from issuance of common shares	231			—			—			231
Net proceeds from issuance of preferred shares	120,567			—			—			120,567
Redemption of preferred shares	(115,013		)	—			—			(115,013		)
Impact of stock option exercises, net	(1,987		)	—			—			(1,987		)
Purchase of common shares for treasury	(3,232		)	—			—			(3,232		)
Dividends paid to shareholders	(162,775		)	—			—			(162,775		)
Net cash provided (used) by financing activities	422,021			(357,727		)	(20,063		)	44,231
Effect of exchange rate changes on cash	—			(5		)	152			147
Net decrease in cash and cash equivalents	(401		)	(592		)	(2,968		)	(3,961		)
Cash and cash equivalents at beginning of the period	1,932			1,243			11,450			14,625
Cash and cash equivalents at end of the period	$	1,531		$	651		$	8,482		$	10,664

Condensed Consolidating Statement of Cash Flows For the Year Ended December 31, 2011

	EPR Properties (Issuer)			Wholly Owned Subsidiary Guarantors			Non-Guarantor Subsidiaries			Consolidated
Intercompany fee income (expense)	$	2,726		$	—		$	(2,726	)	$	—
Interest income (expense) on intercompany receivable/payable	16,665			—			(16,665		)	—
Net cash provided (used) by other operating activities	(12,924		)	143,020			55,572			185,668
Net cash provided by operating activities of continuing operations	6,467			143,020			36,181			185,668
Net cash provided by operating activities of discontinued operations	—			7,947			2,301			10,248
Net cash provided by operating activities	6,467			150,967			38,482			195,916
Investing activities:
Acquisition of rental properties and other assets	(603		)	(46,822		)	(5,750		)	(53,175		)
Investment in unconsolidated joint ventures	(2,773		)	—			(1,197		)	(3,970		)
Investment in mortgage notes receivable	—			(18,391		)	(1,297		)	(19,688		)
Investment in direct financing lease, net	—			(2,113		)	—			(2,113		)
Additions to property under development	—			(53,355		)	(4,571		)	(57,926		)
Investment in intercompany notes payable	127,111			(132,074		)	4,963			—
Advances to subsidiaries, net	108,495			(172,843		)	64,348			—
Net cash provided (used) by investing activities of continuing operations	232,230			(425,598		)	56,496			(136,872		)
Net cash used by other investing activities of discontinued operations	—			(58		)	—			(58		)
Net proceeds from sale of real estate from discontinued operations	—			205,936			20,676			226,612
Net cash provided (used) by investing activities	232,230			(219,720		)	77,172			89,682
Financing activities:
Proceeds from debt facilities	—			387,000			—			387,000
Principal payments on debt	—			(315,324		)	(110,535		)	(425,859		)
Deferred financing fees paid	(396		)	(3,330		)	(5		)	(3,731		)
Costs associated with loan refinancing or payoff (cash portion)	—			—			(117		)	(117		)
Net proceeds from issuance of common shares	253			—			—			253
Redemption of preferred shares	(80,030		)	—			—			(80,030		)
Impact of stock option exercises, net	966			—			—			966
Purchase of common shares for treasury	(3,070		)	—			—			(3,070		)
Dividends paid to shareholders	(157,844		)	—			—			(157,844		)
Net cash provided (used) by financing activities	(240,121		)	68,346			(110,657		)	(282,432		)
Effect of exchange rate changes on cash	—			(166		)	(151		)	(317		)
Net increase (decrease) in cash and cash equivalents	(1,424		)	(573		)	4,846			2,849
Cash and cash equivalents at beginning of the period	3,356			1,816			6,604			11,776
Cash and cash equivalents at end of the period	$	1,932		$	1,243		$	11,450		$	14,625