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, 1996
OMEGA HEALTHCARE INVESTORS, INC.
(Exact name of Registrant as specified in its charter)
Commission file number 1-11316
Maryland 38-3041398
(State of Incorporation) (I.R.S. Employer Identification No.)
905 W. Eisenhower Circle, Suite 110, Ann Arbor, MI 48103
(Address of principal executive offices)
(313) 747-9790
(Telephone number, including area code)
NOT APPLICABLE
(Former name of former address, if changed since last report.)
Item 7. Financial Statements and Exhibits
C) Exhibits
10.1 Placement Agency Agreement dated November 15, 1996 with
National Westminster Bank PLC New York Branch
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
OMEGA HEALTHCARE INVESTORS, INC.
(Registrant)
Date: November 22, 1996 By: S/David A. Stover
David A. Stover
Chief Financial Officer
<PAGE> 1
EXHIBIT 10.1
1,000,000 SHARES
OMEGA HEALTHCARE INVESTORS, INC.
COMMON STOCK
PLACEMENT AGENCY AGREEMENT
November 15, 1996
National Westminster Bank PLC,
New York Branch
175 Water Street
New York, New York 10038
Ladies and Gentlemen:
The undersigned, Omega Healthcare Investors, Inc., a
Maryland corporation (the "Company"), hereby confirms its
agreement with National Westminster Bank PLC, New York Branch
(the "Placement Agent"), as follows:
1. Introductory. The Company proposes to issue and sell
1,000,000 shares (the "Shares") of its common stock, par value
$0.10 per share (the "Common Stock") to certain purchasers (the
"Purchasers"). The Common Stock is more fully described in the
Prospectus referred to below. References herein to the Company
include, where appropriate, the Company and its wholly owned
subsidiaries.
2. Agreement to Act as Placement Agent.
(a) On the basis of the representations, warranties
and agreements of the Company herein contained and subject to
all the terms and conditions of this Agreement, (i) the Company
hereby retains the Placement Agent as its exclusive agent in
connection with the offering of the Shares (the "Offering") for
a period commencing on the date hereof and terminating on the
Closing (as hereinafter defined) and in connection therewith to
introduce the Company to certain investors as prospective
purchasers of the Shares in the Offering (the "Purchasers").
The Placement Agent may, in its sole discretion, retain one or
more sub-placement agents.
(b) The Company agrees to pay the Placement Agent a
fee equal to $0.25 per Share from the sale of the Shares in the
Offering. Such amount shall be payable by the Company at the
Closing by certified or official bank checks payable in New York
Clearing House Funds to the order of the Placement Agent.
(c) The Placement Agent represents and agrees that
(i) it has not offered or sold and will not offer or sell any
Shares to persons in the United Kingdom, except to persons whose
ordinary activities involve them in acquiring, holding managing
or disposing of investments (whether as principal or agent) for
the purposes of their businesses or otherwise in circumstances
which have not resulted and will not result in an offer to the
public in the United Kingdom within the meaning of the Public
Offers of Securities Regulations 1995 or the Financial Services
Act 1986 (the "UK Act"); (ii) it has complied and will comply
with all applicable provisions of the UK Act with respect to
anything done by it in relation to the Shares in, from or
otherwise involving the United Kingdom; and (iii) it has only
issued or passed on, and will only issue or pass on, in the
United Kingdom, any document which consists of or any part of
listing particulars, supplementary listing particulars or any
other document required or permitted to be published by listing
rules under Part IV of the UK Act, to a person who is of a kind
described in Article 11(3) of the Financial Services Act 1986
(Investment Advertisements) (Exemptions) Order 1996 or is a
person to whom the document may otherwise lawfully be issued or
passed on.
3. Representations and Warranties of the Company.
(a) The Company represents and warrants to, and
agrees with, the Placement Agent that:
(i) The Company has filed with the Securities
and Exchange Commission (the "Commission") a
"shelf" registration statement on Form S-3
(Registration No. 33-73532), which has
become effective, relating to the Common
Stock and certain other securities of the
Company, under the Securities Act of 1933,
as amended (the "Act"). The Company will
promptly file with the Commission a
supplement to the form of the prospectus
included in such registration statement
specifically relating to the Shares pursuant
to Rule 424 under the Act. Such
registration statement, as amended at the
date hereof, meets the requirements of Rule
415 under the Act. As used herein, the term
"Registration Statement" means such
registration statement, as amended,
including the prospectus (which includes the
prospectus supplement (the "Prospectus
Supplement") relating to the offering of the
Shares), financial statements, schedules,
exhibits and all documents incorporated by
reference therein, as amended; the term
"Preliminary Prospectus" means each
prospectus (including the Prospectus
Supplement) included in the Registration
Statement, or any amendment thereto, and any
prospectus (including the Prospectus
Supplement) filed by the Company with the
consent of the Representatives pursuant to
Rule 424(b) of the rules and regulations of
the Commission under the Act (the
"Regulations"); and the term "Prospectus"
means the final prospectus (including the
Prospectus Supplement) included as part of
the Registration Statement, except that if
the prospectus relating to the Shares in the
form filed on behalf of the Company with the
Commission pursuant to Rule 424(b) of the
Regulations shall differ from such final
prospectus, the term "Prospectus" shall mean
the prospectus (including the Prospectus
Supplement) so filed pursuant to Rule 424(b)
from and after the date on which it shall
have first been used. Any reference herein
to the Registration Statement, any
preliminary prospectus or the Prospectus
shall be deemed to refer to and include the
documents incorporated by reference therein
pursuant to Item 12 of Form S-3 which were
filed under the Securities Exchange Act of
1934, as amended (the "Exchange Act"), on or
before the effective date of the
Registration Statement, the date of such
Preliminary Prospectus or the date of the
Prospectus, as the case may be, and any
reference herein to the terms "amend,"
"amendment" or "supplement" with respect to
the Registration Statement, any Preliminary
Prospectus or the Prospectus shall be deemed
to refer to and include (i) the filing of
any document under the Exchange Act after
the effective date of the Registration
Statement, the date of such Preliminary
Prospectus or the date of the Prospectus, as
the case may be, which is incorporated
therein by reference and (ii) any such
document so filed.
(ii) When the Registration Statement became
effective, as of the date hereof, and at all
times subsequent thereto to and including
the Closing Date (as defined in Section 3),
and during the thirty-day period following
the Closing Date, the Registration Statement
(and any post-effective amendment thereto)
and the Prospectus (as amended or as
supplemented if the Company shall have filed
with the Commission any amendment or
supplement to the Registration Statement or
the Prospectus) contained and will contain
all statements which are required to be
stated therein in accordance with the Act
and the Regulations, complied and will
comply in all material respects with the Act
and the Regulations, and did not and will
not contain any untrue statement of a
material fact or omit to state any material
fact required to be stated therein or
necessary to make the statements therein (in
the light of the circumstances under which
they were made, in the case of the
Prospectus) not misleading, and no event
will have occurred which should have been
set forth in an amendment or supplement to
the Registration Statement or the Prospectus
which has not then been set forth in such an
amendment or supplement; each Preliminary
Prospectus, as of the date filed with the
Commission, did not include any untrue
statement of a material fact or omit to
state any material fact required to be
stated therein or necessary to make the
statements therein, in the light of the
circumstances under which they were made,
not misleading; except that no
representation or warranty is made in this
Section 3(a)(ii) with respect to statements
or omissions made in reliance upon and in
conformity with written information
furnished to the Company expressly for
inclusion in any Preliminary Prospectus, the
Registration Statement, or the Prospectus,
or any amendment or supplement thereto, as
stated in Section 8(b) hereof with respect
to the Placement Agent by or on behalf of
the Placement Agent.
(iii) The documents incorporated or deemed to be
incorporated by reference in the
Registration Statement and the Prospectus,
at the time they were or hereafter are filed
with the Commission, complied and will
comply in all material respects with the
requirements of the Exchange Act and the
rules and regulations of the Exchange Act
(the "Exchange Act Regulations") and, when
read together with the other information in
the Prospectus, at the time the Registration
Statement became effective and at all times
subsequent thereto to and including the
Closing Date (as hereinafter defined), and
during such longer period as the Prospectus
may be required to be delivered in
connection with sales by a dealer, did not
and will not include an untrue statement of
material fact or omit to state a material
fact required to be stated therein or
necessary to make the statements therein, in
the light of the circumstances under which
they were made, not misleading.
(iv) Neither the Commission nor the "blue sky" or
securities authority of any jurisdiction has
issued an order (a "Stop Order") suspending
the effectiveness of the Registration
Statement, preventing or suspending the use
of any Preliminary Prospectus, the
Prospectus, the Registration Statement, or
any amendment or supplement thereto,
refusing to permit the effectiveness of the
Registration Statement, or suspending the
registration or qualification of the Shares,
nor, to the knowledge of the Company, has
any of such authorities instituted or
threatened to institute any proceedings with
respect to a Stop Order.
(v) Any contract, agreement, instrument, lease,
license or other document required to be
described in the Registration Statement or
the Prospectus has been properly described
therein. Any contract, agreement,
instrument, lease, license or other document
required to be filed as an exhibit to the
Registration Statement has been filed with
the Commission as an exhibit to the
Registration Statement.
(vi) The Company is a corporation duly organized,
validly existing and in good standing under
the laws of Maryland, with full power and
authority (corporate and other), and all
necessary consents, authorizations,
approvals, orders, licenses, certificates
and permits of and from, and declarations
and filings with, all federal, state, local
and other governmental authorities and all
courts and other tribunals, to own, lease,
license and use its properties and assets
and to carry on its business in the manner
described in the Prospectus (except for such
consents, authorizations, approvals, orders,
licenses, certificates, permits,
declarations and filings which the failure
to have obtained, individually or in the
aggregate, does not and will not have a
material adverse effect upon the financial
condition, results of operations, business,
prospects, properties or assets of the
Company), and the Company has not received
any notice of proceedings relating to the
revocation, suspension or modification of
any such consent, authorization, approval,
order, license, certificate, permit,
declaration or filing, nor, to the best
knowledge of the Company, is there any basis
therefor; no such consent, authorization,
approval, order, license, certificate,
permit, declaration or filing contains a
materially burdensome restriction on the
Company not adequately disclosed in the
Registration Statement and the Prospectus;
the Company has fulfilled and performed all
of its material obligations with respect to
each such consent, authorization, approval,
order, license, certificate, permit,
declaration or filing, and no event has
occurred which allows (or which, with notice
or lapse of time or both, would allow)
revocation or termination thereof or results
in any material impairment of the rights of
the holder of any such consent,
authorization, approval, order, license,
certificate, permit, declaration or filing.
The Company is duly qualified to do business
and is in good standing in every
jurisdiction in which its ownership,
leasing, licensing or use of property and
assets or the conduct of its business makes
such qualification necessary, except where
the failure to be so qualified or in good
standing (considering all such failures
together) does not and will not have a
material adverse effect upon the financial
condition, results of operations, business,
prospects, properties or assets of the
Company.
(vii) The authorized capital stock of the Company
consists of 10,000,000 shares of preferred
stock and 50,000,000 shares of common stock.
The issued and outstanding capital stock of
the Company will be as set forth in the
Company's balance sheet at September 30,
1996 contained in the Company's Quarterly
Report on Form 10-Q for the quarter ended
September 30, 1996 incorporated by reference
in the Prospectus (except for subsequent
issuances, if any, pursuant to reservations,
agreements, employee benefit plans, dividend
reinvestment plans or employee and director
stock option plans referred to in the
Prospectus). Each outstanding share of
Common Stock is validly authorized, validly
issued, fully paid and nonassessable, has
not been, or will not be, issued, and is
not, or will not be, owned or held, in
violation of any preemptive rights of
stockholders. There is no commitment, plan
or arrangement to issue, and no outstanding
option, warrant or other right calling for
the issuance of, any share of capital stock
of the Company or any security or other
instrument which by its terms is convertible
into, exercisable for, or exchangeable for
capital stock of the Company, except as
properly described in the Prospectus.
(viii) The financial statements, any supplementary
financial information and any related
schedules included or incorporated by
reference in the Registration Statement and
the Prospectus fairly present, in all
material respects, with respect to the
Company, the financial position, the results
of operations and the other information
purported to be shown therein at the
respective dates and for the respective
periods to which they apply. Such financial
statements, supplementary and other
financial information and related schedules
have been prepared in accordance with
generally accepted accounting principles
consistently applied throughout the periods
involved, are correct and complete, and are
in accordance with the books and records of
the Company in all material respects. The
accountants whose reports on the audited
financial statements are filed with the
Commission as a part of the Registration
Statement are, and during the periods
covered by the reports included or
incorporated by reference in the
Registration Statement and the Prospectus
were, independent certified public
accountants with respect to the Company
within the meaning of the Act and the
Regulations. No other financial statements
are required by Form S-3 or otherwise to be
included or incorporated by reference in the
Registration Statement or the Prospectus.
There has at no time been a material adverse
change in the financial condition, results
of operations, business, properties, or
assets of the Company, as described in the
Prospectus from the latest information set
forth in the Registration Statement or the
Prospectus, except as properly described in
the Prospectus; and there is no fact
actually known to the Company which could
reasonably be expected to have a material
and adverse effect on the future prospects
of the Company (other than political or
economic matters of general applicability or
as properly described in the Prospectus).
(ix) There is no litigation, arbitration, claim,
governmental or other proceeding or
investigation (formal or informal) pending
or, to the knowledge of the Company,
threatened or in prospect (or any basis
therefor known to the Company) with respect
to the Company or its operations, business,
properties or assets except as properly
described in the Prospectus or such as,
individually or in the aggregate, do not now
have and are not reasonably expected in the
future to have a material adverse effect
upon the financial condition, results of
operations, business, prospects, properties
or assets of the Company or such as,
individually and in the aggregate, will not
materially and adversely affect the
consummation of this Agreement or the
transactions contemplated herein. The
Company is not in violation of, or in
default with respect to, any law, rule,
regulation, order, judgment or decree,
except as properly described in the
Prospectus or such as in the aggregate do
not now have and are not reasonably expected
in the future to have a material adverse
effect upon the financial condition, results
of operations, business, prospects,
properties or assets of the Company, nor is
the Company required to take any action in
order to avoid any such violation or
default.
(x) The Company possesses, and at the date
hereof and the Closing Date, will possess,
such authority, licenses, approvals,
franchises, certificates and permits issued
by the appropriate local, state, federal or
foreign regulatory agencies or bodies
necessary to conduct the businesses now
operated by it, except for such authority,
licenses, approvals, franchises,
certificates and permits the absence of
which, singly or in the aggregate, would not
have a material adverse effect on the
financial condition, results of operations,
business, prospects, properties or assets of
the Company; and the Company has not
received any notice of proceedings relating
to the revocation, suspension or
modification of any such authority, license,
approval, franchise, certificate or permit
which, singly or in the aggregate, if the
subject of an unfavorable decision, ruling,
or finding, would materially and adversely
affect the financial condition, results of
operations, business, prospects, properties
or investments of the Company.
(xi) The Company is not now and does not expect
to be in violation or breach of, or in
default with respect to, any material
provision of any contract, agreement,
instrument, lease, license, arrangement or
understanding which is material to the
Company, and each such contract, agreement,
instrument, lease, license, arrangement and
understanding is in full force and is the
legal, valid and binding obligation of the
Company and, to the actual knowledge of the
Company, the other parties thereto and is
enforceable against the Company and, to the
actual knowledge of the Company, against the
other parties thereto in accordance with its
terms and all applicable laws. The Company
enjoys peaceful and undisturbed possession
under all leases and licenses under which it
is operating. The Company is not a party to
or bound by any contract, agreement,
instrument, lease, license, arrangement or
understanding, or subject to any charter or
other restriction, which has had or is
reasonably expected in the future to have a
material adverse effect on the financial
condition, results of operations, business,
prospects, properties or assets of the
Company. The Company is not in violation or
breach of, or in default with respect to,
any term of its certificate of incorporation
or bylaws.
(xii) There is no right under any patent, patent
application, trademark, trademark
application, trade name, service mark,
copyright, franchise or other intangible
property or asset (all of the foregoing
being herein called "Intangibles") necessary
to the business of the Company as described
in the Prospectus, as presently conducted or
as the Prospectus indicates they contemplate
conducting, except as properly described in
the Prospectus. The Company has not
infringed, is not infringing, or has
received notice of infringement with respect
to asserted Intangibles of others, except
for such infringement or alleged
infringement that has not had, or cannot be
reasonably expected to have, a material
adverse effect on the financial condition,
results of operations, business, prospects,
properties or assets of the Company. To the
knowledge of the Company, there is no
infringement by others of Intangibles of the
Company except as properly described in the
Prospectus. To the knowledge of the
Company, there is no Intangible of others
which has had or may in the future have a
material adverse effect on the financial
condition, results of operations, business,
prospects, properties or assets of the
Company.
(xiii) Neither the Company nor any person
associated with or acting on behalf of the
Company nor any person or entity controlled
by any such person, including, without
limitation, any director, officer, agent or
employee of the Company has, directly or
indirectly, while acting on behalf of the
Company (A) used any corporate funds for
unlawful contributions, gifts, entertainment
or other unlawful expenses relating to
political activity; (B) made any unlawful
payment to foreign or domestic government
officials or employees or to foreign or
domestic political parties or campaigns from
corporate funds; (C) violated any provision
of the Foreign Corrupt Practices Act of
1977, as amended; or (D) made any other
payment that is in violation of applicable
law.
(xiv) The Company has all requisite corporate
power and authority to execute, deliver, and
perform this Agreement. This Agreement has
been duly authorized, executed and delivered
by the Company, is the legal, valid and
binding obligation of the Company, and is
enforceable as to the Company in accordance
with its terms, except as such
enforceability thereof may be subject to or
limited by (i) general equity principles and
the limitations on the availability of
equitable relief, including, without
limitation, concepts of materiality,
reasonableness, good faith and fair dealing,
and the possible unavailability of specific
performance or injunctive relief, regardless
of whether considered in a proceeding in
equity or at law and (ii) the effect of
applicable bankruptcy, insolvency,
reorganization, arrangement, moratorium and
laws relating to or affecting the rights of
creditors. No consent, authorization,
approval, order, license, certificate or
permit of or from, or declaration or filing
with, any federal, state, local or other
governmental authority or any court or other
tribunal is required by the Company for the
execution, delivery or performance of this
Agreement, in connection with the issuance,
offering and sale of the Shares or the
consummation of the transactions
contemplated herein or in order for the
Company to comply with its obligations
hereunder (except filings under the Act
which have been or will be made before the
Closing Date and such consents consisting
only of consents under "blue sky" or
securities laws which have been obtained at
or prior to the date of this Agreement or
the failure to obtain which will not in the
aggregate have a material adverse effect on
the financial condition, results of
operations, business, properties or assets
of the Company as described in the
Prospectus). No consent of any party to any
material contract, agreement, instrument,
lease, license, arrangement or understanding
to which the Company is a party, or to which
any of its properties or assets are subject,
is required for the execution, delivery or
performance of this Agreement, the
consummation of the transactions
contemplated herein and the compliance by
the Company with its obligations hereunder;
and the execution, delivery and performance
of this Agreement, the consummation of the
transactions contemplated herein and the
compliance by the Company with its
obligations hereunder will not violate,
result in a breach of, conflict with, result
in the creation or imposition of any lien,
charge or encumbrance upon any property or
assets of the Company pursuant to the terms
of, or (with or without the giving of notice
or the passage of time or both) entitle any
party to terminate or call a default under,
any such contract, agreement, instrument,
lease, license, arrangement or
understanding, or violate or result in a
breach of any term of the certificate of
incorporation or bylaws of the Company, or
violate, result in a breach of, or conflict
with any law, rule, regulation (except for
such law, rule or regulation the violation
of which would not have a material adverse
effect on the financial condition, results
of operations, business, properties or
assets of the Company), order, judgment or
decree binding on the Company or to which
its operations, business, properties or
assets is subject.
(xv) The Shares have been validly authorized and,
when issued and delivered in accordance with
the terms hereof will be issued, fully paid
and nonassessable and will not be issued in
violation of any preemptive rights of
stockholders. The Common Stock conforms to
all statements relating thereto contained in
the Registration Statement or the
Prospectus.
(xvi) Subsequent to the respective dates as of
which information is given in the
Registration Statement and the Prospectus
and except as otherwise properly described
in the Prospectus, the Company has not (A)
issued any securities or incurred any
liability or obligation, primary or
contingent, for borrowed money; (B) entered
into any material transaction other than in
the ordinary course of business; or (C)
except for regular quarterly dividends on
the Company's Common Stock, as declared by
the Company's Board of Directors, declared
or paid any dividend on its capital stock.
(xvii) Neither the Company nor any of its officers,
directors or affiliates (as defined in the
Regulations) has taken or will take,
directly or indirectly, prior to the
termination of the underwriting syndicate
contemplated by this Agreement, any action
designed to stabilize or manipulate the
price of any security of the Company or
which has caused or resulted in, or which
might in the future reasonably be expected
to cause or result in, stabilization or
manipulation of the price of any security of
the Company to facilitate the sale or resale
of the Shares.
(xviii) To the date hereof, all federal, state or
local income or franchise tax returns or
taxes that have been required to be filed or
paid by the Company have been so filed or
paid, and adequate provision has been made
on the books and records of the Company for
all such returns or taxes that are not yet
due.
(xix) There are no outstanding loans, advances
(except normal advances for business
expenses in the ordinary course of business)
or guarantees of indebtedness by the Company
to or for the benefit of any of its officers
or directors or any of the members of the
families of any of them, except as properly
disclosed in the Prospectus.
(xx) Neither the filing of the Registration
Statement nor the offering or sale of the
Shares gives rise to any rights, other than
those which have been waived or satisfied,
for or relating to the registration of any
shares of Common Stock.
(xxi) The Company is organized in conformity with
the requirements for qualification and, as
of the date hereof, operates in a manner
that qualifies it as a real estate
investment trust (a "REIT") under Sections
856-860 of the Internal Revenue Code of
1986, as amended (the "Code") and the rules
and regulations thereunder and has taken no
action which would disqualify it as a REIT.
(xxii) The Company is not an "investment company"
within the meaning of the Investment Company
Act of 1940, as amended (the "1940 Act").
(xxiii) To the best of the Company's knowledge, the
Company or the Company's tenants have
obtained all permits, licenses, and other
authorizations that are required under all
Environmental Laws, including laws relating
to emissions, discharges, releases, or
threatened releases of contaminants into the
environment (including, without limitation,
ambient air, surface water, ground water, or
land) or otherwise relating to the
manufacture, processing, distribution, use,
treatment, storage, disposal, transport, or
handling of contaminants, except to the
extent that failure to have any such permit,
license, or other authorization does not
have a material adverse effect on business,
operations, financial condition, or
prospects of the Company. Except as
otherwise described in the Prospectus, to
the best of its knowledge the Company and
all of its properties are in compliance with
all terms and conditions of all such
permits, licenses, and other authorizations
required to be obtained by it, and are also
in compliance with all other limitations,
restrictions, conditions, standards,
prohibitions, requirements, obligations,
schedules, and timetables contained in those
Environmental Laws or in any regulation,
ordinance, code, plan, order, decree,
judgment, injunction, notice, or demand
letter issued, entered, promulgated, or
approved thereunder, except to the extent
that failure so to comply does not have a
material adverse effect on the business,
operations, financial condition or prospects
of the Company. The Company is not aware of
any prior use of any of its properties by
any person, that constitutes a violation of
any Environmental Laws, except to the extent
that such violation does not have a material
adverse effect on the business, operations,
financial condition or prospects of the
Company. The Company is not aware of any
event, condition, or activity which may
interfere with or prevent continued
compliance by the Company with all
Environmental Laws, except to the extent
that failure so to continue to comply would
not have a material adverse effect on the
business, operations, financial condition or
prospects of the Company. For the purposes
of this Section (xxiv), "Environmental Laws"
shall mean any and all federal, state,
local, and foreign statutes, laws,
regulations, ordinances, rules, judgments,
orders, decrees, permits, concessions,
grants, franchises, licenses, agreements, or
governmental restrictions relating to the
environment or the release of any materials
into the environment, including but not
limited to those related to hazardous
substances or wastes, air emissions and
discharges to waste or public systems.
(xxiv) The Company has, and at the Closing Date
will have, no subsidiaries except for
subsidiaries which are and have always been
wholly owned by the Company.
(xxv) Except as otherwise disclosed in the
Prospectus and except as would not have a
material adverse effect on the business,
operations, financial condition or prospects
of the Company: (i) all of the properties
and assets described in the Prospectus as
owned by the Company are owned with good and
marketable title by the Company; (ii) all
liens, charges, encumbrances, claims or
restrictions on or affecting the properties
and assets of the Company which are required
to be disclosed in the Prospectus are
disclosed therein; (iii) to the best of the
Company's knowledge, each of the properties
owned by the Company complies in all
material respects with all applicable codes
and zoning laws and regulations, except that
the Company is aware that the use of some of
its facilities as healthcare facilities is
permitted nonconforming use under the
applicable zoning regulations; (iv) the
Company has no knowledge of any pending or
threatened condemnation, zoning change or
other proceeding or action that will in any
manner affect the size of, use of,
improvements on, construction on, or access
to the Company's properties; and (v) each of
the mortgages held by the Company are valid,
binding and enforceable in accordance with
their terms.
4. Delivery and Payment. At 10:00 a.m., New York City
time, on November 20, 1996, or at such other time or such other
date as may be agreed upon by the Company and the Placement
Agent (such date is hereinafter referred to as the "Closing
Date"), the Company shall deliver the Shares to the Purchaser,
and the Purchaser shall wire transfer funds to the Company in
the amount of $30,250,000, and to the Placement Agent in the
amount of $250,000. All actions taken at the Closing shall be
deemed to have occurred simultaneously. In the event that the
Shares are not delivered or the funds not transferred on the
Closing Date, then the obligations of the parties hereto shall
terminate in accordance with the provisions of Section 10(b) of
this Agreement.
One or more certificates evidencing the Shares shall
be in definitive form and shall be registered in such names and
in such denominations as the Placement Agent shall request by
written notice to the Company. For the purpose of expediting
the checking and packaging of certificates for the Shares, the
Company agrees to make such certificates available for
inspection at least 24 hours prior to delivery to the
Purchasers.
The cost of original issue tax stamps, if any, in
connection with the issuance, sale and delivery of the Shares by
the Company to the Purchasers shall be borne by the Company.
5. Covenants of the Company.
(a) The Company covenants that it will:
(i) Use its best efforts to amend or supplement
the Registration Statement as necessary to
keep the Registration Statement effective
during the time period specified in Section
3(a)(iii) hereof, and notify you
immediately, and confirm such notice in
writing (A) when any amendment to the
Registration Statement becomes effective,
(B) when any amendment or supplement to the
Prospectus is filed or any document is filed
pursuant to the Act or the Exchange Act, (C)
of the receipt of any comments from the
Commission or the "blue sky" or securities
authority of any jurisdiction regarding any
post-effective amendment to the Registration
Statement, the Prospectus, or any amendment
or supplement thereto or any document
incorporated by reference therein and (D) of
the receipt of any notification with respect
to a Stop Order or the initiation or
threatening of any proceeding with respect
to a Stop Order. The Company will use its
best efforts to prevent the issuance of any
Stop Order and, if any Stop Order is issued,
to obtain the lifting thereof as promptly as
possible.
(ii) During the time when a prospectus relating
to the Shares is required to be delivered
hereunder or under the Act, the Regulations,
the Exchange Act or the Exchange Act
Regulations, comply so far as it is able
with all requirements imposed upon it by the
Act and the Exchange Act, as now existing
and as hereafter amended, and by the
Regulations and the Exchange Act
Regulations, as from time to time in force,
so far as necessary to permit the
continuance of sales of or dealings in the
Shares in accordance with the provisions
hereof and the Prospectus. If, at any time
when a prospectus relating to the Shares is
required to be delivered hereunder or under
the Act, the Regulations, the Exchange Act
or the Exchange Act Regulations, any event
shall have occurred as a result of which, in
the reasonable opinion of counsel for the
Company or counsel for the Placement Agent,
the Registration Statement or the Prospectus
as then amended or supplemented contains any
untrue statement of a material fact or omits
to state any material fact required to be
stated therein (in the light of the
circumstances under which they were made, in
the case of the Prospectus) or necessary to
make the statements therein not misleading,
or if, in the opinion of either of such
counsel, it is necessary at any time to
amend or supplement the Registration
Statement or the Prospectus to comply with
the Act or the Regulations or to file under
the Exchange Act so as to comply therewith
or with the Act any document incorporated by
reference in the Registration Statement or
the Prospectus or in any amendment thereof
or supplement thereto, the Company will
immediately notify the Placement Agent and
promptly prepare and file with the
Commission an appropriate amendment or
supplement (in form and substance
satisfactory to the Placement Agent) which
will correct such statement or omission or
which will effect such compliance and will
use its best efforts to have any such
amendment declared effective as soon as
possible.
(iii) Deliver without charge to the Placement
Agent two signed copies of the Registration
Statement as originally filed and all
amendments thereto, including exhibits and
all documents incorporated by reference
therein and, as soon as any additional
amendment or supplement thereto is filed,
two copies thereof; deliver without charge
to the Placement Agent the number of copies
of each Preliminary Prospectus as reasonably
requested by the Placement Agent; and
deliver without charge to the Placement
Agent such number of copies of the
Prospectus, the Registration Statement and
amendments and supplements thereto, if any,
and all documents incorporated by reference
in therein, without exhibits, as the
Placement Agent may request for the purposes
contemplated by the Act, the Regulations,
the Exchange Act or the Exchange Act
Regulations.
(iv) Endeavor in good faith, in cooperation with
the Placement Agent, to timely qualify the
Shares for offering and sale under the "blue
sky" or securities laws of such
jurisdictions as the Placement Agent may
designate; provided, however, that no such
qualification shall be required in any
jurisdiction where, as a result thereof, the
Company would be subject to service of
general process or to taxation as a foreign
corporation doing business in such
jurisdiction to which it is not then
subject. In each jurisdiction where such
qualification shall be effected, the Company
will, unless the Placement Agent agrees in
writing that such action is not at the time
necessary or advisable, file and make such
statements or reports at such times as are
or may be required by the laws of such
jurisdiction.
(v) During the period of three years after the
date of this Agreement, mail to its holders
of Common Stock, within 90 days after the
end of each fiscal year of the Company, an
audited financial report of the Company and
its subsidiaries, if any, all such financial
reports to include a consolidated balance
sheet as at the end of the preceding fiscal
year, a consolidated statement of
operations, a consolidated statement of cash
flows and a consolidated statement of
stockholders' equity covering such fiscal
year, together with comparable information
as of the end of and for the preceding
fiscal year and all to be in reasonable
detail and examined and reported on by
independent certified public accountants for
the Company.
(vi) For a period of three years after the date
hereof, furnish to the Placement Agent
without charge the following:
(A) as soon as practicable after they have
been sent to stockholders of the
Company or filed with the Commission,
three copies of each annual and interim
financial and other report or
communication sent by the Company to
its stockholders or filed with the
Commission;
(B) as soon as practicable, one copy of
every press release and every material
news item and article in respect of the
Company, its subsidiaries and their
respective affairs released by the
Company; and
(C) such additional publicly available
documents and information with respect
to the Company and its affairs as the
Representatives may from time to time
reasonably request.
(vii) Apply the net proceeds received by it from
the offering in the manner set forth under
"Use of Proceeds" in the Prospectus.
(viii) Furnish to the Placement Agent as early as
practicable prior to the Closing Date but
not less than two full business days prior
thereto, a copy of the latest available
unaudited interim consolidated financial
statements of the Company which have been
read by the Company's independent certified
public accountants, as stated in their
letters to be furnished pursuant to Section
7(e).
(ix) Comply with all registration, filing, and
reporting requirements of the Exchange Act
which may from time to time be applicable to
the Company.
(x) Comply with all provisions of all
undertakings contained in the Registration
Statement.
(xi) Prior to the Closing Date, issue no press
release or other communication directly or
indirectly and hold no press conference with
respect to the Company, or its financial
condition, results of operations, business,
prospects, properties, investments or this
offering, without the prior written consent
of the Placement Agent.
(xii) Use its best efforts to obtain and maintain
in effect the listing of the Shares on the
NYSE and take all necessary steps to cause
the Shares to be listed for regular trading
privileges on the NYSE simultaneously with
the date of this Agreement and to maintain
such listing.
(xiii) Not invest the proceeds from the sale of the
Shares in a manner to cause the Company to
become an "investment company" within the
meaning of the 1940 Act.
(xiv) File all necessary federal, state and local
income and franchise tax returns and pay all
taxes shown as due thereon when due.
(xv) Maintain a system of internal accounting
controls sufficient to provide reasonable
assurances that (A) transactions are
executed in accordance with management's
general or specific authorizations; (B)
transactions are recorded as necessary to
permit preparation of financial statements
in conformity with generally accepted
accounting principles and to maintain
accountability for assets; (C) access to
assets is permitted only in accordance with
management's general or specific
authorization; and (D) the recorded
accountability for assets is compared with
existing assets at reasonable intervals and
appropriate action is taken with respect to
any differences.
(xvi) Conduct its business and take all steps
necessary to qualify and protect and
maintain its status in conformity with the
requirements for qualification as a real
estate investment trust under Sections
856-860 of the Code and the rules and
regulations thereunder.
6. Payment of Expenses. Whether or not the transactions
contemplated by this Agreement are consummated or this Agreement
is terminated, the Company hereby agrees to pay, or reimburse
the Placement Agent, all fees and expenses in connection with
(a) the preparation, printing, filing, distribution and mailing
of the Registration Statement, the Preliminary Prospectus, the
Prospectus and this Agreement, including the cost of all copies
thereof, and the Preliminary Prospectuses and Prospectus and any
amendments or supplements thereto supplied to the Placement
Agent in quantities as hereinabove stated, (b) the preparation
and delivery of certificates representing the Shares, (c) the
qualification of the Shares under state or foreign "blue sky" or
securities laws, including the costs of printing and mailing the
preliminary and final "Blue Sky Survey" and the fees of counsel
for the Placement Agent and the disbursements in connection
therewith, (d) the filing fees payable to the Commission, the
National Association of Securities Dealers, Inc. (the "NASD"),
and the jurisdictions in which such qualification as described
in Section 6(d) is sought, (e) the qualification of the Shares
to be listed for regular trading privileges on the NYSE, (f) the
fees, disbursements and other charges of counsel for the Company
and (g) the fees, disbursements and other charges of counsel for
the Placement Agent in an amount not to exceed $25,000.
7. Conditions of the Obligations of the Placement Agent.
The obligations of the Placement Agent hereunder shall be
subject, in its discretion, to the continuing accuracy of the
representations and warranties of the Company contained herein
and in each certificate and document contemplated under this
Agreement to be delivered to it as of the date hereof and as of
the Closing Date, to the performance by the Company of its
obligations hereunder, and to the following conditions:
(a) At the Closing Date (i) no Stop Order suspending
the effectiveness of the Registration Statement shall have been
issued under the Act or proceedings therefor initiated or
threatened by the Commission and (ii) there shall not have come
to the Placement Agent's attention any facts that would cause it
to believe that the Prospectus, at the time it was required to
be delivered to the Purchasers, included an untrue statement of
a material fact or omitted to state a material fact necessary in
order to make the statements therein, in the light of the
circumstances existing at such time, not misleading.
(b) At the Closing Date the Placement Agent shall
have received the favorable written opinion of Argue Pearson
Harbison & Myers, counsel for the Company, with respect to the
opinions expressed below. Such opinion shall be dated the date
of delivery, addressed to the Placement Agent, and in form and
scope satisfactory to counsel for the Placement Agent, to the
effect that:
(i) The Company has been duly organized and is a
validly existing corporation under the laws
of its jurisdiction of incorporation, with
full corporate power and authority to
conduct its business in the manner described
in the Prospectus; to the knowledge of such
counsel after due inquiry, the Company has
no subsidiaries except those which are and
always have been wholly owned by the
Company.
(ii) The Company is duly qualified to do business
and is in good standing in every
jurisdiction where required (except to the
extent failures to so qualify would not in
the aggregate have a material adverse effect
on the financial condition, results of
operations, business, properties or assets
of the Company).
(iii) Commencing with its taxable year ending
December 31, 1992, the Company has been
organized in conformity with the
requirements for qualification as a "real
estate investment trust" (a "REIT") under
Sections 856-860 of the Internal Revenue
Code of 1986, as amended (the "Code") and
the rules and regulations thereunder, and
its method of operation will enable it to
continue to meet the requirements for
qualification and taxation as a REIT under
the Code.
(iv) The authorized capital stock of the Company
consists of 10,000,000 shares of preferred
stock and 50,000,000 shares of common stock.
Each outstanding share of capital stock of
the Company is validly authorized, validly
issued, fully paid and non-assessable, and
has not been issued and is not owned or held
in violation of any preemptive rights of
stockholders. The Shares have been duly
authorized by all necessary action of the
Company and, when issued by the Company,
will be validly issued and outstanding.
"Validly issued" means that (a) the
Company's directors and, if required,
shareholders have duly authorized the
issuance of the shares, (b) the shares were
not issued in violation of preemptive
rights, (c) the Company received the
consideration specified in the resolution or
resolutions authorizing the issuance, if
any, (d) the consideration received was at
the time permissible consideration for
stock, (e) no agreement of the Company
prohibited or limited the Company's ability
to issue shares of stock, (f) the number of
the issued shares does not exceed the number
of authorized shares, (g) the purchaser of
the shares does not have the right to tender
the shares to the Company and receive in
return the amount he paid the Company
therefor, (h) the form of stock certificate
is proper, and (i) the stock certificate is
properly executed. To the best of such
counsel's knowledge, after due inquiry,
there is no commitment, plan or arrangement
to issue, and no outstanding option, warrant
or other right calling for the issuance of,
any share of capital stock of the Company or
any security or other instrument which by
its terms is convertible into, exercisable
for, or exchangeable for capital stock of
the Company, except as properly described in
the Prospectus. To the best of such
counsel's knowledge, after due inquiry,
there is outstanding no security or other
instrument which by its terms is convertible
into, exercisable for, or exchangeable for
capital stock of the Company, except as
properly described in the Prospectus.
(v) To the best of such counsel's knowledge
after due inquiry of the Company's officers
but without other investigation, there is no
litigation, arbitration, claim, governmental
or other proceeding or investigation (formal
or informal) pending or threatened with
respect to the Company or its operations,
business, properties or assets, except as
properly described in the Prospectus or such
as, individually or in the aggregate, do not
now have and are not reasonably expected in
the future to have a material adverse effect
upon the financial condition, results of
operations, business, properties or assets
of the Company.
(vi) To the best of such counsel's knowledge, the
Company is not now, nor with notice or
passage of time or both or upon consummation
of the transactions contemplated hereby will
be, in material violation or breach of, or
in default with respect to, any material
provision of any contract, agreement,
instrument, lease, license, permit
certificate, arrangement or understanding
which is material to the Company, except as
properly described in the Prospectus.
(vii) To the best of such counsel's knowledge, the
Company is not in violation or breach of, or
in default with respect to, any term of its
respective articles of incorporation or
bylaws.
(viii) The Company has all requisite corporate
power and corporate authority to execute,
deliver and perform this Agreement. All
necessary corporate proceedings of the
Company have been taken to authorize the
execution, delivery and performance of this
Agreement by the Company. This Agreement
has been duly authorized, executed and
delivered by the Company, is the legal,
valid and binding obligation of the Company,
and is enforceable as to the Company in
accordance with its terms (subject to the
availability of equitable remedies and to
applicable bankruptcy, insolvency and other
laws affecting creditors' rights generally
and except as rights to indemnity and
contribution hereunder may be limited by
federal or state securities laws). To the
best of such counsel's knowledge, no
consent, authorization, approval, order,
license, certificate or permit of or from,
or declaration or filing with, any federal,
state, local or other governmental authority
or any court or other tribunal is required
by the Company for the issuance, offering
and sale of the Shares to the Purchasers or
the execution, delivery or performance of
this Agreement by the Company. All filings
were made under the Act. Such opinion may
state that counsel is not representing the
Company in respect of "blue sky" matters.
To the best of such counsel's knowledge, no
consent of any party to any material
contract, agreement, instrument, lease,
license, arrangement or understanding, to
which the Company is a party or to which its
properties or assets is subject, is required
for the issuance, offering and sale of the
Shares to the Purchasers and the execution,
delivery or performance of this Agreement,
in connection with the consummation of the
transactions contemplated herein and therein
or in order for the Company to comply with
its obligations hereunder and thereunder,
other than those which have been received;
and the issuance, offering and sale of the
Shares to the Purchasers and the execution
and delivery of this Agreement, the
consummation of the transactions
contemplated herein and therein and the
compliance by the Company with its
obligations hereunder and thereunder will
not, and this Agreement, the transactions
contemplated herein and therein and the
Company's obligations hereunder and
thereunder may be performed in a manner that
does not violate, result in a breach of,
conflict with, or (with or without the
giving of notice or the passage of time or
both entitle any party to terminate or call
a default under any such contract,
agreement, instrument, lease, license,
arrangement or understanding known to such
counsel, or violate or result in a breach of
any term of the certificate of incorporation
or bylaws of the Company, or violate, result
in a breach of, or conflict with any law,
rule, regulation (except for such law, rule
or regulation, the violation of which would
not have a material adverse effect on the
Company), or, to the best of such counsel's
knowledge, order, judgment, or decree
binding on the Company or to which its
operations, business, properties or assets
is subject.
(ix) The Common Stock conforms to all statements
relating thereto contained in the
Registration Statement or the Prospectus.
(x) To the best of such counsel's knowledge, any
contract, agreement, instrument, lease or
license required to be described in the
Registration Statement or the Prospectus has
been properly described therein. To the
best of such counsel's knowledge, any
contract, agreement, instrument, lease,
permit, certificate or license required to
be filed as an exhibit to the Registration
Statement has been filed with the Commission
as an exhibit to the Registration Statement.
(xi) Insofar as statements in the Prospectus
purport to summarize the provision of laws,
rules, regulations, orders, judgments,
decrees, contracts, agreements, instruments,
leases or licenses, such statements have
been prepared or reviewed by such counsel
and, to the best of the knowledge of such
counsel, accurately reflect the provisions
purported to be summarized and are correct
in all material respects.
(xii) To the best of such counsel's knowledge, the
Company possesses all authority, material
certificates and material permits issued by
the appropriate local, state, federal and
foreign regulatory agencies or bodies
necessary to conduct its business, in the
manner described in the Prospectus, and to
the knowledge of such counsel, the Company
has not received any notice of any
proceeding relating to the revocation or
modification of any such authority, material
certificate or material permit which, singly
or in the aggregate, if the subject of an
unfavorable decision, ruling or finding,
would have a material adverse effect on the
financial condition, results of operations,
business, properties or assets of the
Company.
(xiii) To the best of such counsel's knowledge, all
leases by and pledges and mortgages to the
Company as a beneficiary are valid, existing
and enforceable leases, pledges or
mortgages, as the case may be, and no
default exists under any such lease, pledge
or mortgage. To the best of such counsel's
knowledge, the Company has all governmental
licenses, certificates, permits,
authorizations, approvals, franchises or
other rights necessary to engage in the
business currently conducted by it and
proposed to be conducted by it as described
in the Prospectus. Such counsel has no
reason to believe that any governmental body
or agency is considering limiting,
suspending or revoking (or that any
transaction contemplated by this Agreement
or described in the Prospectus will cause
the limitation, suspension or revocation of
any such license, certificate, permit,
authorization, approval, franchise or right.
(xiv) On the basis of the participation of such
counsel in conferences with officers and
other representatives of the Company,
representatives of, and counsel for, the
Placement Agent, and representatives of the
independent public accountants for the
Company, at which the contents of the
Registration Statement and the Prospectus
and related matters were discussed, but
without independent verification by such
counsel of the accuracy, completeness or
fairness of the statements contained in the
Registration Statement, the Prospectus or
any amendment or supplement thereto, (A) the
Registration Statement and the Prospectus
and any supplements or amendments thereto
(except for financial statements, related
schedules and other financial data contained
therein, as to which such counsel need not
express an opinion) comply as to form in all
material respects with the Act and the
Regulations, (B) the documents filed under
the Exchange Act and incorporated by
reference in the Registration Statement and
the Prospectus or any amendment thereof or
supplement thereto (except for financial
statements, related schedules and other
financial data contained or incorporated by
reference therein, as to which such counsel
need not express an opinion) comply as to
form in all material respects with the
Exchange Act and the rules and regulations
of the Commission thereunder, and (C)
nothing has come to the attention of such
counsel that leads them to believe that
(except for financial statements, related
schedules and other financial data contained
therein, as to which such counsel need not
express a belief, the Registration Statement
(and any post-effective amendment thereto)
and the Prospectus (and any amendments or
supplements thereto) included therein and
the documents incorporated by reference
therein, at the time the Registration
Statement became effective and at all times
subsequent thereto up to the date of such
opinion, contained any untrue statement of a
material fact or omitted to state a material
fact required to be stated therein or
necessary to make the statements therein (in
the light of the circumstances under which
they were made, in the case of the
Prospectus) not misleading.
(xv) The Registration Statement has become
effective under the Act and, to such
counsel's knowledge, no Stop Order has been
issued and no proceedings for that purpose
have been instituted or threatened.
(xvi) To the best of such counsel's knowledge, no
holders of Common Stock or other securities
of the Company have any registration rights
with respect to Common Stock or other
securities, except such registration rights,
if any, which have been validly waived with
respect to the offering of the Shares
hereby.
(xvii) The statements in the Prospectus under the
captions "Risk Factors - Government Health
Care Regulation; - Possible Reduction of
Reimbursement by Third Party Payors; -
Certain Bankruptcy Limitations; - Certain
Legal Aspects of the Mortgage Loans; -
Environmental Risks; - Certain Restrictions
on Transfer of Shares; Business
Combinations; and - Consequences of Failure
to Qualify as a Real Estate Investment
Trust;" "The Company - Investment Strategies
and Policies; and "Investments and
Financings;" "Description of Securities;"
"Recent Developments;" and "Description of
Common Stock;" insofar as such statements
constitute a summary of the legal matters,
documents or proceedings referenced therein,
fairly present the information called for by
the Regulations with respect to such legal
matters, documents and proceedings in all
material respects.
In rendering such opinions, counsel for the Company may
rely (A) as to matters involving the application of laws other
than the federal laws of the United States and the laws of the
State of California, to the extent such counsel deems proper and
to the extent specified in such opinion, upon an opinion or
opinions (in form and substance satisfactory to counsel for the
Placement Agent) of other counsel, acceptable to counsel for the
Placement Agent, familiar with applicable laws, in which case
the opinions of such counsel shall state that the opinion or
opinions of such other counsel are satisfactory in scope and
form to such counsel and that reliance thereon by such counsel
and the Placement Agent is reasonable; (B) as to matters of
fact, to the extent they deem proper, on certificates of
responsible officers of the Company; and (C) to the extent they
deem proper, upon written statements or certificates of officers
of departments of various jurisdictions having custody of
documents respecting the corporate existence or good standing of
the Company provided that copies of any such statements or
certificates shall be delivered to counsel for the Placement
Agent.
(c) On or prior to the Closing Date the Placement
Agent shall have been furnished such information, documents,
certificates and opinions as it may reasonably require for the
purpose of enabling it to review the matters referred to in
Section 7(b), and in order to evidence the accuracy,
completeness or satisfaction of any of the representations,
warranties, covenants, agreements or conditions herein
contained, or as the Placement Agent may reasonably request.
(d) At the Closing Date there shall not have been,
since the date hereof or since the respective dates as of which
information is given in the Prospectus, any material adverse
change in the financial condition, results of operations,
business, properties or assets of the Company, whether or not
arising in the ordinary course of business; and the Placement
Agent shall have received a certificate of the chief executive
officer and of the chief financial officer of the Company, dated
the Closing Date to the effect that (i) there has been no such
material adverse change, (ii) as of the date of this Agreement
and as of the Closing Date the representations and warranties of
the Company contained herein were and are accurate, and (iii) as
of the Closing Date the obligations to be performed by the
Company hereunder on or prior thereto have been fully performed.
(e) At the Closing Date the Placement Agent shall
have received letters, addressed to the Placement Agent and in
form and substance previously approved by the Placement Agent,
with reproduced copies or signed counterparts thereof, dated the
date of delivery, from Ernst & Young, with respect to the
financial statements and certain other financial information
included in the Prospectus.
(f) On or prior to the Closing Date, the Shares shall
have been approved for listing on the NYSE, subject only to
notice of issuance.
(g) All proceedings taken in connection with the
issuance, sale, transfer and delivery of the Shares shall be
satisfactory in form and substance to the Placement Agent and to
counsel for the Placement Agent.
Any certificate or other document signed by any officer of
the Company and delivered to the Placement Agent or to counsel
for the Placement Agent shall be deemed a representation and
warranty by the Company hereunder to the Placement Agent as to
the statements made therein. If any condition to the Placement
Agent's obligations hereunder to be fulfilled prior to or at the
Closing Date is not so fulfilled, the Placement Agent may
terminate this Agreement or, if the Placement Agent so elects in
writing, waive any such conditions which have not been fulfilled
or extend the time for their fulfillment.
8. Indemnification and Contribution.
(a) Subject to the conditions set forth below, the
Company agrees to indemnify and hold harmless the Placement
Agent, its officers, directors, partners, employees, agents and
counsel, and each person, if any, who controls the Placement
Agent within the meaning of Section 15 of the Act or Section
20(a) of the Exchange Act, against any and all loss, liability,
claim, damage and expense whatsoever (which shall include, for
all purposes of this Section 8, but not be limited to,
reasonable attorneys' fees and expenses incurred in
investigating, preparing for or defending against any
litigation, commenced or threatened, or any claim whatsoever and
any and all amounts paid in settlement of any claim or
litigation) as and when incurred arising out of, based upon, or
in connection with any untrue statement or alleged untrue
statement of a material fact contained (A) in any Preliminary
Prospectus, the Registration Statement or the Prospectus (as
from time to time amended and supplemented) or any amendment or
supplement thereto or (B) in any application or other document
or communication (in this Section 8 collectively called an
"application") executed by or on behalf of the Company or based
upon written information furnished by or on behalf of the
Company filed in any jurisdiction in order to qualify the Shares
under the "blue sky" or securities laws thereof or filed with
the Commission, the NASD or any securities exchange; or any
omission or alleged omission to state a material fact required
to be stated therein or necessary to make the statements therein
(in the light of the circumstances under which they were made,
in the case of the Prospectus) not misleading, unless such
statement or omission was made in reliance upon and in
conformity with written information furnished to the Company as
stated in Section 8(b) with respect to the Placement Agent by or
on behalf of the Placement Agent expressly for inclusion in any
Preliminary Prospectus, the Registration Statement or the
Prospectus or any amendment or supplement thereto, or in any
application, as the case may be; provided, however, that the
indemnification contained in this paragraph with respect to any
Preliminary Prospectus shall not inure to the benefit of the
Placement Agent (or to the benefit of any person controlling the
Placement Agent or any employee, officer, director, partner,
agent or counsel of the Placement Agent) on account of any such
loss, liability, claim, damage or expense arising from the sale
of the Shares to any person if a copy of the Prospectus, as
amended or supplemented, shall not have been delivered or sent
to such person within the time required by the Act and the
Regulations, and the untrue statement or alleged untrue
statement or omission or alleged omission of a material fact
contained in such Preliminary Prospectus was corrected in the
Prospectus, as amended or supplemented, provided that the
Company had delivered the Prospectus, as amended or
supplemented, to the Placement Agent on a timely basis to permit
such delivery or sending. The foregoing agreement to indemnify
shall be in addition to any liability the Company may otherwise
have, including liabilities arising under this Agreement.
If any claim or action is brought against the Placement
Agent or any of its officers, directors, partners, employees,
agents or counsel, or any controlling persons of the Placement
Agent (each, an "indemnified party") in respect of which
indemnity may be sought against the Company pursuant to the
foregoing paragraph, such indemnified party shall promptly
notify all the parties (the "indemnifying parties") against whom
indemnification is to be sought in writing of the institution of
such claim or action (but the failure so to notify shall not
relieve the indemnifying parties from any liability they may
have other than pursuant to this Agreement except to the extent
that the indemnifying parties are materially and adversely
affected by such failure to notify) and the indemnifying parties
shall promptly assume the defense of such claim or action,
including the employment of counsel (reasonably satisfactory to
such indemnified party) and payment of expenses. Such
indemnified party shall have the right to employ its own counsel
in any such case, but the fees and expenses of such counsel
shall be at the expense of such indemnified party unless (i) the
employment of such counsel shall have been authorized in writing
by one of the indemnifying parties in connection with the
defense of such claim or action, (ii) the indemnifying parties
shall not have promptly employed counsel reasonably satisfactory
to such indemnified party to have charge of the defense of such
claim or action or (iii) such indemnified party shall have been
advised in writing by counsel that there reasonably appear to be
one or more legal defenses available to it or them or to other
indemnified party which are different from or additional to
those available to one or more of the indemnifying parties, in
any of which events such reasonable fees and expenses shall be
borne by the indemnifying parties and the indemnifying parties
shall not have the right to direct the defense of such claim or
action on behalf of the indemnified party, it being understood,
however, that the indemnifying parties shall not, in connection
with any one such claim, action or proceeding or separate but
substantially similar or related claims, actions or proceedings
in the same jurisdiction arising out of the same general
allegations or circumstances, be liable for the reasonable fees
and expenses of more than one separate firm of attorneys (in
addition to local counsel). Anything in this Section 8(a) to
the contrary notwithstanding, the Company shall not be liable
for any settlement of any claim or action effected without its
written consent. The Company agrees promptly to notify the
Placement Agent of the commencement of any litigation or
proceedings against the Company or any of its officers or
directors in connection with the sale of the Shares, any
Preliminary Prospectus, the Registration Statement or the
Prospectus, or any amendment or supplement thereto, or any
application.
(b) The Placement Agent agrees to indemnify and hold
harmless the Company, and the Company's officers, directors,
employees, agents and counsel, and each other person, if any,
who controls the Company within the meaning of Section 15 of the
Act or Section 20(a) of the Exchange Act, to the same extent as
the foregoing indemnity from the Company to the Placement Agent
in Section 8(a), but only with respect to statements or
omissions, if any, made in the Preliminary Prospectus, the
Registration Statement, or the Prospectus (as from time to time
amended or supplemented), or any amendment or supplement
thereto, or in any application in reliance upon and in
conformity with written information furnished to the Company as
stated in this Section 8(b) with respect to the Placement Agent
by or on behalf of the Placement Agent expressly for inclusion
in any Preliminary Prospectus, the Registration Statement, or
the Prospectus, or any amendment or supplement thereto, or in
any application, as the case may be; provided, however, that the
obligation of the Placement Agent to provide indemnity under the
provisions of this Section 8(b) shall be limited to the
Aggregate Principal Amount. For all purposes of this Agreement,
the information as set forth under the caption "Plan of
Distribution" in the Prospectus Supplement constitute the only
information furnished in writing by or on behalf of the
Placement Agent expressly for inclusion in any Preliminary
Prospectus, the Registration Statement or the Prospectus (as
from time to time amended or supplemented), or any amendment or
supplement thereto, or in any application, as the case may be.
If any action shall be brought against the Company, or any other
person so indemnified based on any Preliminary Prospectus, the
Registration Statement or the Prospectus, or any amendment or
supplement thereto, or in any application, and in respect of
which indemnity may be sought against the Placement Agent
pursuant to this Section 8(b), the Placement Agent shall have
the rights and duties given to the indemnifying parties, and the
Company, and each other person so indemnified shall have the
rights given to the indemnified parties by the provision of
Section 8(a).
(c) To provide for just and equitable contribution,
if (i) an indemnified party makes a claim for indemnification
pursuant to Section 8(a) or 8(b) (subject to the limitations
thereof) but it is found in a final judicial determination, not
subject to further appeal, that such indemnification may not be
enforced in such case, even though this Agreement expressly
provides for indemnification in such case or (ii) any
indemnified or indemnifying party seeks contribution under the
Act, the Exchange Act or otherwise, then the Company (including,
for this purpose any contribution made by or on behalf of any
director of the Company, any officer of the Company who signed
the Registration Statement and any controlling person of the
Company) and the Placement Agent, in the aggregate (including
for this purpose any contribution by or on behalf of an
indemnified party), shall contribute to the losses, liabilities,
claims, damages and expenses to which any of them may be
subject, in such proportions as are appropriate to reflect the
relative benefits received by the Company and the Placement
Agent in the aggregate; provided, however, that if applicable
law does not permit such allocation, then other relevant
equitable considerations such as the relative fault of the
Company, and the Placement Agent in the aggregate, in connection
with the facts which resulted in such losses, liabilities,
claims, damages and expenses shall also be considered. The
relative benefits received by the Company and the Placement
Agent in the aggregate, shall be deemed to be in the same
proportion as (x) the total proceeds from the offering (before
deducting expenses) received by the Company, and (y) the fee
received by the Placement Agent hereunder in the aggregate. The
relative fault, in the case of an untrue statement, alleged
untrue statement, omission or alleged omission, shall be
determined by, among other things, whether such statement,
alleged statement, omission or alleged omission related to
information supplied by the Company or by the Placement Agent,
and the parties' relative intent, knowledge, access to
information, and opportunity to correct or prevent such
statement, alleged statement, omission or alleged omission. The
Company and the Placement Agent agree that it would be unjust
and inequitable if the respective obligations of the Company and
the Placement Agent for contribution were determined by pro rata
or per capita allocation of the aggregate losses, liabilities,
claims, damages and expenses or by any other method of
allocation that does not reflect the equitable considerations
referred to in this Section 8(c). No person guilty of a
fraudulent misrepresentation (within the meaning of Section
11(f) of the Act) shall be entitled to contribution from any
person who is not guilty of such fraudulent misrepresentation.
For purposes of this Section 8(c), each person, if any, who
controls the Placement Agent within the meaning of Section 15 of
the Act or Section 20(a) of the Exchange Act and each officer,
director, partner, employee, agent and counsel of the Placement
Agent shall have the same rights to contribution as the
Placement Agent and each person, if any, who controls the
Company within the meaning of Section 15 of the Act or Section
20(a) of the Exchange Act, and each officer, director, agent and
counsel of the Company shall have the same rights to
contribution as the Company, subject in each case to the
provisions of this Section 8(c). Anything in this Section 8(c)
to the contrary notwithstanding, no party shall be liable for
contribution with respect to the settlement of any claim or
action effected without its written consent. This Section 8(c)
is intended to supersede any right to contribution under the
Act, the Exchange Act or otherwise.
(d) The parties to this Agreement hereby acknowledge
that they are sophisticated business persons who were
represented by counsel during the negotiations regarding the
provisions hereof, including, without limitation, the provisions
of this Section 8, and are fully informed regarding said
provisions. They further acknowledge that the provisions of
this Section 8 fairly allocate the risks in light of the ability
of the parties to investigate the Company and its business in
order to assure that adequate disclosure is made in the
Registration Statement and Prospectus as required by the Act and
the Exchange Act.
9. Representations and Agreements to Survive Delivery.
All representations, warranties, covenants and agreements
contained in this Agreement shall be deemed to be
representations, warranties, covenants and agreements at the
Closing Date, and such representations, warranties, covenants
and agreements of the Placement Agent and the Company, including
the indemnity and contribution agreements contained in Section
8, shall remain operative and in full force and effect
regardless of any investigation made by or on behalf of any the
Placement Agent or any indemnified person, or by or on behalf of
the Company, or any person or entity which is entitled to be
indemnified under Section 8, and shall survive termination of
this Agreement or the delivery of the Shares to the Purchasers.
In addition, the provisions of Sections 5(a)(i), 6, 8, 9, 10, 12
and 13 shall survive termination of this Agreement, whether such
termination occurs before or after the Closing Date.
10. Termination.
(a) The Placement Agent shall have the right to
terminate this Agreement at any time prior to the Closing Date
by giving notice to the Company if any domestic or international
event, act, or occurrence has materially disrupted, or in the
opinion of the Placement Agent will in the immediate future
materially disrupt, the securities markets; or if there shall
have been a general suspension of, or a general limitation on
prices for, trading in securities on the New York Stock
Exchange, the American Stock Exchange, the International Stock
Exchange of the United Kingdom and the Republic of Ireland,
Limited or in the over-the-counter market; or if there shall
have been an outbreak of major hostilities or material
escalation thereof or other national or international calamity;
or if a banking moratorium has been declared by a state or
federal authority in the United States or by an authority in the
United Kingdom; or if a moratorium in foreign exchange trading
by major international banks or persons has been declared; or if
there shall have been a material interruption in the mail
service or other means of communication within the United
States; or if the Company or its properties taken together shall
have sustained a material or substantial loss by fire, flood,
accident, hurricane, earthquake, theft, sabotage or other
calamity or malicious act which, whether or not such loss shall
have been insured, will, in the opinion of the Placement Agent,
make it inadvisable to proceed with the offering, sale or
delivery of the Shares, or if there shall have been such change
in the market for the Company's securities or securities in
general or in political, financial or economic conditions as in
the judgment of the Placement Agent makes it impracticable to
proceed with the offering, sale and delivery of the Shares on
the terms contemplated by the Prospectus. If the Placement
Agent elects to terminate this Agreement pursuant to this
paragraph (a), it shall notify the Company promptly by
telephone, telex, telegram or telecopy, confirmed by letter.
(b) The obligations of the parties under this
Agreement shall be automatically terminated in the event that
the Shares are not delivered or the funds not transferred on the
Closing Date.
(c) Anything in this Agreement to the contrary
notwithstanding, except as specified in Section 10(d) hereof, if
this Agreement shall terminate or shall otherwise not be carried
out within the time specified herein by reason of any failure on
the part of the Company to perform any covenant or agreement or
satisfy any condition of this Agreement by it to be performed or
satisfied, the sole liability of the Company to the Placement
Agent, in addition to the obligations the Company assumed
pursuant to Section 6, will be to reimburse promptly the
Placement Agent for such out-of-pocket expenses (including the
fees and expenses of their counsel) as shall have been incurred
by them in connection with this Agreement and the proposed
offer, sale and delivery of the Shares, and upon demand the
Company agrees to pay promptly the full amount thereof to, the
Placement Agent. Anything in this Agreement to the contrary
notwithstanding other than Section 10(d) hereof, if this
Agreement shall not be carried out within the time specified
herein for any reason other than the failure on the part of the
Company to perform any covenant or agreement or satisfy any
condition of this Agreement by it to be performed or satisfied,
the Company shall have no liability to the several Underwriters
other than for obligations assumed by the Company pursuant to
Section 6 hereof.
(d) Notwithstanding any election hereunder or any
termination of this Agreement, and whether or not this Agreement
is otherwise carried out, the provisions of Sections 5(a)(i), 6,
8, 9, 10, 12 and 13 shall not be in any way affected by such
election or termination or failure to carry out the terms of
this Agreement or any part hereof.
11. Notices. All communications hereunder, except as may
be otherwise specifically provided herein, shall be in writing
and, if sent to the Placement Agent shall be mailed, delivered,
or telexed, telegraphed or telecopied, and confirmed by letter,
to National Westminster Bank PLC, New York Branch, 175 Water
Street, New York, New York 10038, Attention: Bradley Razook,
with a copy to Stroock & Stroock & Lavan, Seven Hanover Square,
New York, New York 10004, Attention: James Tanenbaum, Esq.; or,
if sent to the Company, shall be mailed, delivered or telexed,
telegraphed or telecopied, and confirmed by letter, to the
Company, 905 West Eisenhower Circle, Ann Arbor, Michigan 48013,
Attention; Essel W. Bailey, Jr., with a copy to Argue Pearson
Harbison & Myers, 801 South Flower Street, Los Angeles,
California 90017, Attention: Don M. Pearson, Esq. All notices
hereunder shall be effective upon receipt by the party to which
it is addressed.
12. Construction. THIS AGREEMENT SHALL BE CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT
GIVING EFFECT TO THE RULES GOVERNING THE CONFLICTS OF LAW. TIME
IS OF THE ESSENCE IN THIS AGREEMENT.
13. Counterparts. This Agreement may be signed by any one
or more of the parties hereto in any number of counterparts,
each of which shall be deemed to be an original, but all such
counterparts shall constitute one and the same agreement.
<PAGE>
If the foregoing correctly sets forth the understanding
between you and the Company, please so indicate in the space
provided below for that purpose, whereupon this letter shall
constitute a binding agreement between us.
Very truly yours,
OMEGA HEALTHCARE INVESTORS, INC.
By:S/DAVID A. STOVER
DAVID A. STOVER
CHIEF FINANCIAL OFFICER
Accepted as of the date
first above written:
NATIONAL WESTMINSTER BANK PLC,
NEW YORK BRANCH
By:S/BRADFORD WILDAUER
BRADFORD WILDAUER
<PAGE>
EXHIBIT A
Form of Escrow Agreement
