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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES AND EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported) July 31, 1997
OMEGA HEALTHCARE INVESTORS, INC.
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(Exact name of registrant as specified in its charter)
MARYLAND 1-11316 NO. 38-3041398
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(State or other (Commission (IRS Employer
jurisdiction of File No.) Identification
incorporation) No.)
905 WEST EISENHOWER CIRCLE, SUITE 110, ANN ARBOR, MI 48103
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(Address of principal executive officers) (Zip Code)
Registrant's telephone number, including area code (313) 747-9790
NOT APPLICABLE
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(Former name or former address, if changed since last report.)
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Item 7. Financial Statements and Exhibits
(c) Exhibits
1 Underwriting Agreement dated July 31, 1997 relating
to the 6.95% Notes due 2007
4 Form of Supplemental Indenture No. 1 dated as of
August 5, 1997 relating to the 6.95% Notes due 2007
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.
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(Registrant)
Date: August 5, 1997 By: /s/ David A. Stover
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David A. Stover
Chief Financial Officer
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EXHIBIT INDEX
1 Underwriting Agreement dated July 31, 1997 relating to the 6.95%
Notes due 2007
4 Form of Supplemental Indenture No. 1 dated as of August 5, 1997
relating to the 6.95% Notes due 2007
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EXHIBIT 1
OMEGA HEALTHCARE INVESTORS, INC.
Debt Securities
Underwriting Agreement
July 31, 1997
To the Representatives named
in Schedule I hereto of the
Underwriters named in
Schedule II hereto
Dear Sirs:
Omega Healthcare Investors, Inc., a Maryland corporation (the
"Company"), proposes to issue and sell to the underwriters named in Schedule II
hereto (the "Underwriters"), for whom you are acting as representatives (the
"Representatives"), the principal amount of its debt securities identified in
Schedule I hereto (the "Securities"), to be issued under the indenture
specified in Schedule I hereto (the "Indenture") between the Company and NBD
Bank (the "Trustee"). If the firm or firms listed in Schedule II hereto
include only the firm or firms listed in Schedule I hereto, then the terms
"Underwriters" and "Representatives", as used herein, shall each be deemed to
refer to such firm or firms.
The Company has prepared and filed with the Securities and Exchange
Commission (the "Commission") in accordance with the provisions of Securities
Act of 1933, as amended, and the rules and regulations of the Commission
thereunder (collectively, the "Securities Act"), two registration statements
(the file numbers of which are set forth in Schedule I hereto) on Form S-3,
relating to certain securities (the "Shelf Securities") to be issued from time
to time by the Company. The Company also has filed with, or proposes to file
with, the Commission pursuant to Rule 424 under the Securities Act a prospectus
supplement specifically relating to the Securities. The registration
statements as amended to the date of this Agreement are hereinafter
collectively referred to as the "Registration Statement" and the related
prospectus covering the Shelf Securities in the form first used to confirm
sales of the Securities is hereinafter referred to as the "Basic Prospectus".
The Basic Prospectus as supplemented by the prospectus supplement specifically
relating to the Securities in the form first used to confirm sales of the
Securities is hereinafter referred to as the "Prospectus". Any reference in
this Agreement to the
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Registration Statement, the Basic Prospectus, any preliminary form of
Prospectus (a "preliminary prospectus") previously filed with the Commission
pursuant to Rule 424 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
under the Securities Act which were filed under the Securities Exchange Act of
1934, as amended, and the rules and regulations of the Commission thereunder
(collectively, the "Exchange Act") on or before the date of this Agreement or
the date of the Basic Prospectus, any preliminary prospectus or the Prospectus,
as the case may be; and any reference to "amend", "amendment" or "supplement"
with respect the Registration Statement, the Basic Prospectus, any preliminary
prospectus or the Prospectus shall be deemed to refer to and include any
documents filed under the Exchange Act after the date of this Agreement, or the
date of the Basic Prospectus, any preliminary prospectus or the Prospectus, as
the case may be, which are deemed to be incorporated by reference therein.
The Company hereby agrees with the Underwriters as follows:
1. The Company agrees to issue and sell the Securities to the
several Underwriters as hereinafter provided, and each Underwriter, on the
basis of the representations and warranties herein contained, but subject to
the conditions hereinafter stated, agrees to purchase, severally and not
jointly, from the Company the respective principal amount of Securities set
forth opposite such Underwriter's name in Schedule II hereto at the purchase
price set forth in Schedule I hereto plus accrued interest, if any, from the
date specified in Schedule I hereto to the date of payment and delivery.
2. The Company understands that the several Underwriters intend
(i) to make a public offering of their respective portions of the Securities
and (ii) initially to offer the Securities upon the terms set forth in the
Prospectus.
3. Payment for the Securities shall be made to the Company or to
its order in immediately available funds on the date and at the time and place
set forth in Schedule I hereto (or at such other time and place on the same or
such other date, not later than the third Business Day thereafter, as you and
the Company may agree in writing). Such payment will be made upon delivery to,
or to you for the respective accounts of, such Underwriters of the Securities
registered in such names and in such denominations as you shall request not
less than two full Business Days prior to the date of delivery, with any
transfer taxes payable in connection with transfer to the Underwriters duly
paid by the Company. As used herein, the term "Business Day" means any day
other than a day on which banks are permitted or required to be closed in New
York City. The time and date of such payment and delivery with respect to the
Securities are referred to herein as the Closing Date. The certificates for
the Securities will be made available for inspection and packaging by you by
1:00 P.M. on the Business Day prior to the Closing Date at such place in New
York City as you and the Company shall agree.
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4. (a) The Company represents and warrants to and agrees
with each Underwriter that as of the date hereof and as of the Closing Date:
(i) The Company meets the requirements for use of
Form S-3 under the Securities Act, and has prepared, in conformity
with the Securities Act, and has filed the Registration Statement on
Form S-3 which has become effective for the registration of up to
$155,750,000 aggregate issue price of securities including the
Securities. The Registration Statement, as declared effective and
each amendment thereto declared effective through the date of this
Agreement, meets the requirements set forth in Rule 415(a)(1) under
the Securities Act and complies in all material respects with such
Rule. No stop order suspending the effectiveness of the Registration
Statement has been issued and no proceeding for that purpose has been
instituted or, to the knowledge of the Company, threatened by the
Commission. The Company has filed or will promptly file with the
Commission pursuant to Rule 424 under the Securities Act a supplement
to the form of prospectus included in such registration statement
relating to the Securities and the plan of distribution of the
Securities. Copies of the Registration Statement, including any
amendments thereto, each related preliminary prospectus (meeting the
requirements of the Securities) contained therein, the exhibits,
financial statements and schedules have heretofore been delivered by
the Company to you;
(ii) The Commission has not issued, and is not to
the best knowledge of the Company threatening to issue, an order
preventing or suspending the use of any Preliminary Prospectus or the
Prospectus nor instituted proceedings for that purpose. Each
Preliminary Prospectus at its date of issue, the Registration
Statement and the Prospectus and any amendments or supplements thereto
contains or will contain, as the case may be, all statements which are
required to be stated therein by, and in all material respects conform
or will conform, as the case may be, to the requirements of, the
Securities Act and the Trust Indenture Act of 1939, as amended (the
"Trust Indenture Act"). Neither the Registration Statement nor any
amendment thereto, as of the applicable effective date, contains or
will contain, as the case may be, any untrue statement of a material
fact or omits or will omit to state any material fact required to be
stated therein or necessary to make the statements therein not
misleading, and neither the Prospectus nor any supplement thereto
contains or will contain, as the case may be, any untrue statement of
a material fact or omits or will omit to state any material fact
required to be stated therein or necessary to make the statements
therein, in light of the circumstances under which they were made, not
misleading; provided, however, that the Company makes no
representation, warranty or agreement as to information contained in
or omitted from the Registration Statement, the Preliminary Prospectus
or the Prospectus, or any such amendment or supplement, in reliance
upon, and in conformity with, written information furnished to the
Company by or on behalf of the Underwriters
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specifically for use in the preparation of: (x) the last paragraph of
the cover page of the form of prospectus included in the Registration
Statement, any such Preliminary Prospectus or the Prospectus, or any
such amendment or supplement thereto or (y) the statements therein
regarding over-allotment, stabilization or passive market making by
the Underwriters or (z) the section thereof under the caption
"Underwriting";
(iii) The documents incorporated by reference in
the Prospectus, at the time they were filed with the Commission,
complied in all material respects with the requirements of the
Exchange Act, and, when read together and with the other information
contained in the Prospectus, at the time a Preliminary Prospectus was
filed with the Commission in connection with the offer and sale of the
Securities and the Closing Date did not or will not as the case may
be, contain an untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the
statements therein, in light of the circumstances under which they
were made, not misleading;
(iv) The Company has full right and corporate
power and authority to enter into this Agreement and the Indenture and
to perform the transactions contemplated hereby and thereby. The
filing of the Registration Statement and the execution and delivery of
this Agreement and the Indenture have been duly authorized by the
Board of Directors of the Company. This Agreement and the Indenture
each constitute a valid and legally binding obligation of the Company
enforceable in accordance with its terms (except to the extent the
enforceability of the indemnification, exculpation and contribution
provisions of Section 7 hereof may be limited by applicable law, and
except as enforceability of this Agreement and the Indenture may be
limited by bankruptcy, insolvency, reorganization, fraudulent
conveyance, moratorium and other laws affecting creditors' rights
generally and by general principles of equity, regardless of whether
such enforceability is considered in a proceeding in equity or at
law). The issue and sale of the Securities by the Company and the
performance of this Agreement and the Indenture by the Company and the
consummation of the transactions herein and therein contemplated will
not result in a violation of the Company's articles of incorporation
or bylaws or result in a breach or violation of the Company's articles
of incorporation or bylaws or result in a breach or violation of any
of the terms and provisions of, or constitute a default under, or
result in the creation or imposition of any lien, charge or
encumbrance upon any properties or assets of the Company or its
subsidiary entities identified on Schedule III hereto (the
"Subsidiaries") under, any statute which is applicable to it, or under
any indenture, mortgage, deed of trust, note, loan agreement, sale and
leaseback arrangement or other agreement or instrument to which the
Company or any of the Subsidiaries is a party or by which they are
bound or to which any of the properties or assets of the Company or
the Subsidiaries is subject, or any order, rule or
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regulation applicable to the Company or any of the Subsidiaries of any
court or public, regulatory or governmental agency or body having
jurisdiction over the Company or the Subsidiaries or their properties,
other than any such breach, violation, default, lien, charge or
encumbrance, as the case may be, which does not materially adversely
affect the business of the Company and the Subsidiaries taken as a
whole. No consent, approval, authorization, order, registration or
qualification of or with any court or public, regulatory or
governmental agency or body is required for the consummation of the
transactions herein contemplated, except such as have been obtained
under the Securities Act, the Trust Indenture Act and as may be
required by the National Association of Securities Dealer, Inc. (the
"NASD") or any state securities laws;
(v) The Securities have been duly authorized,
and, when issued and delivered pursuant to this Agreement, will have
been duly executed, authenticated, issued and delivered and will
constitute valid legally binding obligations of the Company
enforceable in accordance with their terms (except as enforceability
thereof may be limited by bankruptcy, insolvency, reorganization,
fraudulent conveyance, moratorium and other laws affecting creditors'
rights generally and by general principals of equity, regardless of
whether such enforceability is considered in a proceeding in equity or
at law), entitled to the benefits provided by the Indenture; the
Indenture has been duly authorized and duly qualified under the Trust
Indenture Act; and the Securities and the Indenture will conform to
the descriptions thereof in the Prospectus in all material respects;
(vi) Except as described in the Prospectus,
neither the Company nor any of the Subsidiaries has sustained since
the date of the latest audited financial statements included in the
Prospectus any material loss or interference with its business from
fire, explosion, flood or other calamity, whether or not covered by
insurance, or from any labor dispute or court or governmental action,
order or decree, which loss or interference could reasonably be
expected to have a material adverse effect on the business of the
Company and the Subsidiaries taken as a whole. Except as contemplated
in the Prospectus, subsequent to the respective dates as of which
information is given in the Registration Statement and the Prospectus,
the Company and the Subsidiaries taken as a whole have not incurred
any material liabilities or material obligations, direct or
contingent, other than in the ordinary course of business, or entered
into any material transactions not in the ordinary course of business,
and there has not been any material change in the capital stock or
long-term debt of the Company and the Subsidiaries taken as a whole or
any material adverse change in the financial condition, net worth,
business, management, or results of operations of the Company and the
Subsidiaries taken as a whole. The Company and the Subsidiaries have
filed all necessary federal, state and foreign income and franchise
tax returns and paid all taxes shown as due thereon, except
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as are being contested by the Company or the Subsidiaries in good
faith. All tax liabilities, including those being contested by the
Company or the Subsidiaries, are adequately provided for on the books
of the Company and the Subsidiaries except to such extent as would not
materially adversely affect the business of the Company and the
Subsidiaries taken as a whole. The Company and the Subsidiaries have
made all required payroll tax payments and are current and up-to-date
as of the date of this Agreement to the extent necessary to avoid a
material adverse effect on the business of the Company and the
Subsidiaries taken as a whole. The Company and the Subsidiaries have
no knowledge of any tax proceeding or action pending or threatened
against the Company or the Subsidiaries which could materially
adversely affect their business or property taken as a whole;
(vii) The Company and the Subsidiaries have good
and marketable title to all real property or interests in real
property described in the Prospectus under the caption "Properties" as
being owned by it or any of them, in each case free and clear of all
liens, encumbrances and defects except such as are described in the
Prospectus or such as do not materially adversely affect the value of
such property and interests and do not interfere with the use made and
proposed to be made of such property and interests by the Company and
the Subsidiaries; the Company and the Subsidiaries have obtained
satisfactory confirmations (consisting of policies of title insurance
of commitments or binders therefor or opinions of counsel based upon
the examination of abstracts) confirming, except as otherwise
described in the Prospectus, (A) that the Company and the Subsidiaries
have the foregoing title to such real property and interests in real
property, and (B) that the instruments securing the Company's and the
Subsidiaries' real estate mortgage loans create valid liens upon the
real properties described in such instruments enjoying the priorities
intended, subject only to exceptions to title which do not materially
adversely affect the value of such real properties and interests in
relation to the Company and the Subsidiaries considered as one
enterprise; and all leases to which the Company or the Subsidiaries is
a lessee relating to real property are valid and binding agreements of
the Company or the Subsidiaries and no default exists or is continuing
thereunder, and the Company or the subsidiary enjoys peaceful and
undisturbed possession under all such leases to which it is a party as
lessee;
(viii) The Company has been organized in conformity
with the requirements for qualification, and with respect to all tax
periods regarding which the Internal Revenue Service is or will be
entitled to assert any claim, assessment or adjustment, has operated
and as of the date hereof operates, and as of the Closing Date will
operate, in a manner that qualifies the Company as a "real estate
investment trust" (a "REIT") under the Internal Revenue Code of 1986,
as amended (the "Code"), and the rules and regulations thereunder, and
will continue to operate in such a manner after
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consummation of the transactions contemplated by the Prospectus and
any Preliminary Prospectus;
(ix) Except as described in the Prospectus, there is
no action, suit, arbitration, investigation or governmental
proceeding, domestic or foreign, pending or, to the best of the
Company's knowledge, threatened to which the Company or any of the
Subsidiaries is or may be a party, or involving the properties or
business of the Company or any of the Subsidiaries which challenges
the validity of this Agreement or any action taken or required to be
taken by the Company pursuant to or in connection with this Agreement
or which could reasonably by expected to materially and adversely
affect the financial condition, operation, properties, business or
results of operations of the Company and the Subsidiaries taken as a
whole. Neither the Company nor any of the Subsidiaries is a party or
is subject to the provisions of any injunction, judgment, decree or
order of any court or any public, regulatory or governmental agency or
body which could reasonably be expected to materially and adversely
affect their business and property taken as a whole or the Company's
ability to consummate the transactions contemplated herein. There are
no contracts or documents to which the Company or any of the
Subsidiaries is a party which would be required to be filed as
exhibits to the Registration Statement by the Securities Act which
have not been filed as exhibits to the Registration Statement or
incorporated by reference therein; the contracts and documents to
which the Company or any of the Subsidiaries is a party which are so
described in the Registration Statement are in full force and effect
on the date hereof; and neither the Company nor any of the
Subsidiaries nor, to the best knowledge of the Company, any other
party is in breach of or default under any of such contracts;
provided that this representation shall not apply to defaults which in
the aggregate could not materially adversely affect the financial
condition or the business of the Company and the Subsidiaries taken as
a whole;
(x) The Company has duly and validly authorized
capital stock as described in the Prospectus.
(xi) The Company and the Subsidiaries have each been
duly incorporated and are validly existing as corporations in good
standing under the laws of the states or other jurisdictions in which
they are incorporated, with full corporate power and authority to own,
lease and operate their properties and conduct their businesses as
described in the Registration Statement; the Company and the
Subsidiaries are duly qualified to do business as foreign corporations
in good standing in each state or other jurisdiction in which their
ownership or leasing of property or conduct of business legally
requires such qualification, except where the failure to be so
qualified would not have a material adverse effect on the ability of
the Company and the Subsidiaries taken as a whole to
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conduct its or their business as described in the Registration
Statement. The Company does not own or control, directly or
indirectly, any corporation, association or other entity other than
the Subsidiaries. The outstanding shares of capital stock of the
Company's Subsidiaries have been duly authorized and validly issued,
are fully paid and nonassessable and are owned by the Company free and
clear of any mortgage, pledge, lien, encumbrance, charge or adverse
claim. No options, warrants or other rights to purchase, agreement or
other obligations to issue or other right to convert any obligations
into shares of capital stock or ownership interests in the
Subsidiaries are outstanding. None of the Company's Subsidiaries owns
or controls directly or indirectly, any corporation, association or
other entity;
(xii) Ernst & Young, LLP, the accounting firm which
has certified or reviewed portions of the financial statements filed
with the Commission as a part of the Registration Statement, some of
which are included in the Prospectus, is an independent public
accounting firm within the meaning of the Securities Act;
(xiii) The consolidated financial statements and
schedules of the Company and the Subsidiaries, including the notes
thereto, filed with the Commission (through incorporation by reference
or otherwise) and as a part of the Registration Statement, are
accurate in all material respects and present fairly the consolidated
financial position of the Company and the Subsidiaries as of the
respective dates thereof and the consolidated results of operations
and statements of cash flow for the respective periods covered
thereby, all in conformity with generally accepted accounting
principles applied on a consistent basis throughout the periods
involved except as otherwise disclosed in the Prospectus. The
selected financial data included in the Registration Statement and
Prospectus present fairly the information shown therein and have been
compiled on a basis consistent with that of the audited financial
statements in the Registration Statement and Prospectus;
(xiv) Neither the Company nor any of the
Subsidiaries is in default with respect to any contract or agreement
to which it is a party; provided that this representation shall not
apply to defaults which in the aggregate could not materially
adversely affect the financial condition or the business of the
Company and the Subsidiaries taken as a whole;
(xv) Neither the Company, any of the Subsidiaries
or, to the best of the Company's knowledge, any lessee or sublessee of
any Property or any portion thereof, is in breach or violation of any
provision of its certificate of incorporation or bylaws or any laws,
ordinances or governmental rules or regulations to which it is
subject, including, without limitation, Section 13(b) of the Exchange
Act, and neither the
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Company, any of the Subsidiaries or, to the best of the Company's
knowledge, any lessee or sublessee of any Property or any portion
thereof, has failed to obtain, maintain or comply with the terms of
any of the material licenses, certificates, permits, franchises,
easements, consents, or other governmental authorizations necessary to
the ownership, leasing and operation of its properties or to the
conduct of its business, which breach, violation or failure would
materially adversely affect the business, operations, properties,
profits or financial condition of the Company and the Subsidiaries
taken as a whole;
(xvi) Except as described in the Prospectus, the
Company and the Subsidiaries own or possess, or can acquire on
commercially reasonable terms, such patent licenses, trademarks,
service marks, trade names and other intellectual property rights as
are materially necessary for the conduct of the businesses now
operated by them taken as a whole, and neither the Company nor any of
the Subsidiaries has received any notice from any party of any
infringement of or conflict with asserted rights of any other party
with respect to any patent licenses, trademarks, service marks, trade
names or other intellectual property rights which infringements or
violations, singly or in the aggregate, if the same were to be the
subject of an unfavorable judicial or governmental decision or ruling
against the Company or any of the Subsidiaries which is unappealable
by the Company or any such Subsidiary, would materially adversely
affect the business, operations or financial condition of the Company
and the Subsidiaries taken as a whole;
(xvii) Except as described in the Prospectus, to the
best of the Company's knowledge: (i) there has been no storage,
disposal, generation, transportation, handling or treatment of
hazardous substances or solid wastes by the Company or any of the
Subsidiaries (or to the best knowledge of the Company, any of their
predecessors in interest or any lessees or sublessee of any Property
or any portion thereof) at, upon or from any of the property now or
previously owned or leased by the Company, any of the Subsidiaries or,
to the best of the Company's knowledge, any lessee or any sublessee of
any Property or any portion thereof, in violation of any applicable
law, ordinance, rule, regulation, order, judgment, decree or permit or
which would require remedial action which has not been taken, under
any applicable law, ordinance, rule, regulation, order, judgment,
decree or permit, except for any violation or failure to take remedial
action which would not result in, singularly or in the aggregate with
all such violations and remedial actions, any material adverse change
in the financial condition, results of operations, business or
properties of the Company and the Subsidiaries taken as a whole; (ii)
there has been no material spill, discharge, leak, emission,
injection, escape, dumping or release of any kind into such property
or into the environment surrounding such property by the Company, any
of the Subsidiaries or, to the best of the Company's knowledge, any
lessee or any sublessee of any Property or any portion thereof, of any
solid waste or hazardous substances, except for any such spill,
discharge, leak, emission,
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injection, escape, dumping or release which would not result in,
singularly or in the aggregate with all such spills, discharges,
leaks, emissions, injections, escapes, dumpings and release, any
material adverse change in the financial condition, results of
operation, business or properties of the Company and the Subsidiaries
taken as a whole, and (iii) the Company has complied with the
disclosure requirements under the Securities Act and the Exchange Act
with respect to environmental matters. For the purposes of this
paragraph, the term "hazardous substances" and "solid wastes" shall
have the meanings specified in any applicable local, state and federal
laws or regulations with respect to environmental protection;
(xviii) With respect to the properties described in
the Prospectus or reflected in the Company's consolidated financial
statements included or incorporated by reference therein, the Company
and the Subsidiaries (i) are in compliance with any and all applicable
foreign, Federal, state and local laws and regulations relating to the
protection of human health and safety, the environment or hazardous or
toxic substances or wastes, pollutants or contaminants ("Environmental
Laws"), (ii) have obtained all permits, licenses or other approvals
required of them under applicable Environmental Laws to conduct their
respective businesses and (iii) are in compliance with all terms and
conditions of any permit, license, approval, except where such
noncompliance or failure to obtain or comply with the terms and
conditions of such Environmental Laws, permits, licenses or approvals
are otherwise disclosed in the Prospectus or would not, singly, or in
the aggregate, have a material adverse effect on the condition
(financial or other), business affairs or prospects, earnings, net
worth or results of operations of the Company and the Subsidiaries
taken as a whole;
(xix) No labor disturbance between the Company or
any of the Subsidiaries and the employees thereof exists or, to the
best knowledge of the Company, is imminent which would have a material
adverse effect on the Company and the Subsidiaries taken as a whole;
(xx) The Company is not an "investment company"
within the meaning of the Investment Company Act of 1940, as amended;
(xxi) The Company and each of the Subsidiaries
maintain insurance of the types and in the amounts customarily
maintained by REITs engaged in activities similar to those of the
Company, all of which insurance is in full force and effect;
(xxii) Immediately after any sale of Securities by
the Company hereunder, the aggregate amount of Securities which have
been issued and sold by the Company hereunder and of any securities of
the Company (other than the Securities) that shall have
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been issued and sold pursuant to the Registration Statement will not
exceed the amount of securities registered under the Registration
Statement; and
(xxiii) The Company and the Subsidiaries hold all
material licenses, certificates and permits form governmental
authorities which are necessary to the conduct of their business.
5. The Company covenants and agrees with the several Underwriters
as follows:
(a) to file the Prospectus in a form approved by you
pursuant to Rule 424 under the Securities Act not later than the
Commission's close of business on the second Business Day following
the date of determination of the offering price of the Securities;
(b) to deliver to each Representative and counsel for the
Underwriters, at the expense of the Company, a signed copy of the
Registration Statement (as originally filed) and each amendment
thereto, in each case including exhibits and documents incorporated by
reference therein and, during the period mentioned in paragraph (e)
below, to each of the Underwriters as many copies of the Prospectus
(including all amendments and supplements thereto) and documents
incorporated by reference therein as you may reasonably request, when
filed with Commission;
(c) from the date hereof and prior to the Closing Date,
to furnish to you a copy of any proposed amendment or supplement to
the Registration Statement or the Prospectus, for your review, and not
to file any such proposed amendment or supplement to which you
reasonably object;
(d) to file promptly all reports and any definitive proxy
or information statements required to be filed by the Company with the
Commission pursuant to Section 13(a), 13(c), 14 or 15(d) of the
Exchange Act for so long as the delivery of a prospectus is required
in connection with the offering or sale of the Securities, and during
such same period, to advise you promptly, and to confirm such advice
in writing, (i) when any amendment to the Registration Statement shall
have become effective, (ii) of any request by the Commission for any
amendment to the Registration Statement or any amendment or supplement
to the Prospectus or for any additional information, (iii) of the
issuance by the Commission of any stop order suspending the
effectiveness of the Registration Statement or the initiation or
threatening of any proceeding for that purpose, and (iv) of the
receipt by the Company of any notification with respect to any
suspension of the qualification of the Securities for offer and sale
in any jurisdiction or the initiation or threatening of any proceeding
for such purpose; and to use its best efforts to prevent the issuance
of any such stop order or notification and, if issued, to obtain as
soon as
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possible the withdrawal thereof;
(e) if, during such period after the first date of the
public offering of the Securities as in the opinion of counsel for the
Underwriters a prospectus relating to the Securities is required by
law to be delivered in connection with sales by an Underwriter or
dealer, any event shall occur as a result of which it is necessary to
amend or supplement the Prospectus in order to make the statements
therein, in the light of the circumstances when the Prospectus is
delivered to a purchaser, not misleading, or if it is necessary to
amend or supplement the Prospectus to comply with law, forthwith to
prepare and furnish, at the expense of the Company, to the
Underwriters and to the dealers (whose names and addresses you will
furnish to the Company) to which Securities may have been sold by you
on behalf of the Underwriters and to any other dealers upon request,
such amendments or supplements to the Prospectus as may be necessary
so that the statements in the Prospectus as so amended or supplemented
will not, in the light of the circumstances when the Prospectus is
delivered to a purchaser, be misleading or so that the Prospectus will
comply with law;
(f) to endeavor to qualify the Securities for offer and
sale under the securities or Blue Sky laws of such jurisdictions as
you shall reasonably request and to continue such qualification in
effect so long as reasonably required for distribution of the
Securities and to pay all fees and expenses (including fees and
disbursements of counsel to the Underwriters) reasonably incurred in
connection with such qualification and in connection with the
determination of the eligibility of the Securities for investment
under the laws of such jurisdictions as you may designate;
provided that the Company shall not be
required to file a general consent to service of process in any
jurisdiction;
(g) to make generally available to its security holders
and to you as soon as practicable but not later than 15 months after
the effective date of the Registration Statement (as defined in Rule
158(c) under the Securities Act) an earnings statement covering a
period of at least twelve months beginning with the first fiscal
quarter of the Company occurring after the effective date of the
Registration Statement, which shall satisfy the provisions of Section
11(a) of the Securities Act and Rule 158 of the Commission promulgated
thereunder;
(h) so long as the Securities are outstanding, to furnish
to you copies of all reports or other communications (financial or
other) furnished to holders of Securities, and copies of any reports
and financial statements furnished to or filed with the Commission or
any national securities exchange;
(i) during the period beginning on the date hereof and
continuing to and
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including the Business Day following the Closing Date, not to offer,
sell, contract to sell or otherwise dispose of any debt securities of
or guaranteed by the Company which are substantially similar to the
Securities without your prior written consent;
(j) to use the net proceeds received by the Company from
the sale of the Securities pursuant to this Agreement in the manner
specified in the Prospectus under the caption "Use of Proceeds"; and
(k) whether or not the transactions contemplated in this
Agreement are consummated or this Agreement is terminated, to pay all
costs and expenses incident to the performance of its obligations
hereunder, including without limiting the generality of the foregoing,
all costs and expenses (i) incident to the preparation, issuance,
execution, authentication and delivery of the Securities, including
any expenses of the Trustee, (ii) incident to the preparation,
printing and filing under the Securities Act of the Registration
Statement, the Prospectus and any preliminary prospectus (including in
each case all exhibits, amendments and supplements thereto), (iii)
incurred in connection with the registration or qualification and
determination of eligibility for investment of the Securities under
the laws of such jurisdictions as the Underwriters may designate
(including reasonable fees of counsel for the Underwriters and their
disbursements), (iv) in connection with the listing of the Securities
on any stock exchange, (v) related to any filing with National
Association of Securities Dealers, Inc., (vi) in connection with the
printing (including word processing and duplication costs) and
delivery of this Agreement, the Indenture[, the Preliminary and
Supplemental Blue Sky Memoranda] and any Legal Investment Survey and
the furnishing to Underwriters and dealers of copies of the
Registration Statement and the Prospectus, including mailing and
shipping, as herein provided and (vii) payable to rating agencies in
connection with the rating of the Securities.
6. The several obligations of the Underwriters hereunder shall be
subject to the following conditions:
(a) the representations and warranties of the Company
contained herein are true and correct on and as of the Closing Date as
if made on and as of the Closing Date and the Company shall have
complied with all agreements and all conditions on its part to be
performed or satisfied hereunder at or prior to the Closing Date;
(b) the Prospectus shall have been filed with the
Commission pursuant to Rule 424 within the applicable time period
prescribed for such filing by the rules and regulations under the
Securities Act; no stop order suspending the effectiveness of the
Registration Statement shall be in effect, and no proceedings for such
purpose shall be pending
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<PAGE> 14
before or threatened by the Commission; and all requests for
additional information on the part of the Commission shall have been
complied with to your satisfaction;
(c) subsequent to the execution and delivery of this
Agreement and prior to the Closing Date, there shall not have occurred
any downgrading, nor shall any notice have been given of (i) any
intended or potential downgrading, or (ii) any review or possible
change that does not indicate an improvement, in the rating accorded
any securities of or guaranteed by the Company by any "nationally
recognized statistical rating organization", as such term is defined
for purposes of Rule 436(g)(2) under the Securities Act;
(d) since the respective dates as of which information is
given in the Prospectus there shall not have been any material adverse
change or any development involving a material adverse change, in or
affecting the general affairs, business, prospects, management,
properties, financial position, stockholders' equity or results of
operations of the Company and the Subsidiaries, taken as a whole,
otherwise than as set forth or contemplated in the Prospectus, the
effect of which in the judgment of the Representatives makes it
impracticable or inadvisable to proceed with the public offering or
the delivery of the Securities on the terms and in the manner
contemplated in the Prospectus;
(e) the Representatives shall have received on and as of
the Closing Date a certificate of an executive officer of the Company
satisfactory to you to the effect set forth in subsections (a) through
(c) of this Section and to the further effect that there has not
occurred any material adverse change, or any development involving a
prospective material adverse change, in or affecting the general
affairs, business, prospects, management, properties, financial
position, stockholders' equity or results of operations of the Company
and the Subsidiaries taken as a whole from that set forth or
contemplated in the Registration Statement;
(f) On the Closing Date you shall have received the
opinion of Argue Pearson Haribson & Myers, LLP counsel for the
Company, addressed to you and dated the Closing Date, substantially to
the effect that
(i) The Company and the Subsidiaries have been
incorporated and are validly existing as corporations in good
standing under the laws of the states or other jurisdictions
in which they are incorporated, with full corporate power and
authority to own, lease and operate their properties and
conduct their businesses as described in the Registration
Statement. The Company and the Subsidiaries are duly
qualified to do business as foreign corporations in good
standing in each
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<PAGE> 15
state or other jurisdiction in which their ownership or leasing of
property or conduct of business legally requires such qualification,
except where the failure to be so qualified would not have a material
adverse effect on the ability of the Company and the Subsidiaries
taken as a whole to conduct their business as described in the
Registration Statement. Based solely on such counsel's review of the
articles or certificates of incorporation, bylaws, corporate minutes,
and such other governing instruments and corporate documents of the
Company's Subsidiaries as such counsel deemed necessary or advisable
for such purpose, the outstanding shares of capital stock of the
Company's Subsidiaries have been duly authorized and validly issued
and, so far as is known to such counsel, are owned by the Company free
and clear of any mortgage, pledge, lien encumbrance, charge or adverse
claim, and are not the subject of any agreement or understanding with
any person
(ii) The Company's authorized capital stock is as set
forth under the heading "Capitalization" in the Prospectus.
(iii) Such counsel has been advised by the staff of the
Commission that the Registration Statement has become effective under
the Securities Act and, to the best knowledge of such counsel, no stop
order suspending the effectiveness of the Registration Statement has
been issued and no proceedings for that purpose have been instituted
or are pending or contemplated under the Securities Act; any required
filing of the Prospectus and any supplement thereto pursuant to Rule
424(b) under the Securities Act has been made in the manner and within
the time period required by such Rule 424(b).
(iv) The Registration Statement and the Prospectus, and each
amendment or supplement thereto, as of their respective effective or
issue dates, comply as to form in all material respects with the
requirements of Form S-3 under the Securities Act (except that such
counsel need express no opinion or belief as to numerical, financial
and statistical data, financial statements and notes and related
schedules thereto). With respect to the documents incorporated by
reference in the Prospectus, although such counsel may not have
represented the Company at the time such documents were prepared and
filed with the Commission and did not review or examine such documents
prior to the time such documents were filed with the Commission, such
counsel has no reason to believe, without any independent
investigation or inquiry on the part of such counsel whatsoever, that
on the date such documents were filed with the Commission, such
documents did not comply as to form in all material respects with
applicable requirements of the Exchange Act (except that such counsel
need
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<PAGE> 16
express no opinion or belief as to numerical financial and statistical
data, financial statements and notes and related schedules thereto).
(v) The descriptions in the Registration Statement and
Prospectus of contracts and other documents filed as exhibits to the
Registration Statement are accurate in all material respects.
(vi) To the best knowledge of such counsel, no
authorization, approval, consent, order, registration or qualification
of or with any court or public, regulatory or governmental body,
authority or agency is required with respect to the Company in
connection with the transactions contemplated by this Agreement or the
Indenture, except such as may be required under the Securities Act,
the Exchange Act or the Trust Indenture Act or by the NASD or under
state laws in connection with the purchase and distribution of the
Securities by the Underwriters.
(vii) The Company has the corporate power and authority to
enter into this Agreement and to sell and deliver the Securities to be
sold by it to the several Underwriters. The filing of the Registration
Statement with the Commission has been duly authorized by the Board of
Directors of the Company. This Agreement has been duly authorized,
executed and delivered by the Company, and is a valid and legally
binding obligation of the Company enforceable in accordance with its
terms (except to the extent the enforceability of the indemnification,
exculpation and contribution provisions of Section 7 hereof may be
limited by applicable law and except as enforceability of this
Agreement may be limited by bankruptcy, insolvency, fraudulent
conveyance, reorganization, moratorium and other laws affecting
creditors' rights generally and by general principles of equity,
regardless of whether such enforceability is considered in a
proceeding in equity or at law). The making and performance of this
Agreement and the Indenture by the Company and the consummation of the
transactions herein and therein contemplated will not result in a
violation of the Company's certificate of incorporation or bylaws or
to the best knowledge of such counsel result in a breach or violation
of any of the terms and provisions of, or constitute a default under,
or result in the creation or imposition of any lien, charge or
encumbrance upon any properties or assets of the Company or any of the
Subsidiaries under, any applicable federal or state statute, or under
any indenture, mortgage, deed of trust, note, loan agreement, lease,
franchise, license, permit or any other agreement or instrument known
to such counsel to which the Company or any of the Subsidiaries is a
party or by which they are bound or to which any of the properties or
assets of the Company or the Subsidiaries are subject, or any order,
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<PAGE> 17
rule or regulation known to such counsel of any court or public,
regulatory or governmental agency, authority or body having
jurisdiction over the Company or any of the Subsidiaries or their
properties, except, in the case of any such violation, breach,
default, creation or imposition, to such extent as does not materially
adversely affect the business of the Company and the Subsidiaries
taken as a whole.
(viii) To the best knowledge of such counsel, (A) there are no
(individually or in the aggregate) legal, governmental or regulatory
proceedings pending or threatened to which the Company or any of the
Subsidiaries is a party or of which the business or properties of the
Company or any of the Subsidiaries is the subject which would have a
material adverse effect on the business or property of the Company and
the Subsidiaries taken as a whole or on the ability of the Company to
consummate the transactions contemplated herein, and which are not
disclosed in the Registration Statement and Prospectus; (B) there are
no contracts or documents of a character required to be described in
the Registration Statement or the Prospectus or to be filed as an
exhibit to the Registration Statement which are not described therein
or filed as required; (C) neither the Company nor any of the
Subsidiaries is a party or subject to the provisions of any
injunction, judgment, decree or order of any court or any public,
regulatory or governmental agency, authority or body which would have
a material adverse effect on the business or property of the Company
and the Subsidiaries taken as a whole or on the ability of the Company
to consummate the transactions contemplated herein; and (D) there are
no applicable Federal or state statutes, orders, rules or regulations
required to be described in the Registration Statement or Prospectus
under the Act, the Exchange Act or applicable state securities laws
which are not described therein as required.
(ix) To the best knowledge of such counsel, the Company and
each of the Subsidiaries hold all licenses, certificates, permits,
franchises, consents, authorizations and approvals from all state and
federal regulatory authorities, that are required for the Company and
the Subsidiaries to conduct their business as described in the
Prospectus, except in the case of any such license, certificate,
permit, franchise, consent, authorization or approval the loss of
which or failure to maintain would not have a material adverse effect
on the business of the Company and the Subsidiaries taken as a whole.
(x) The Company has qualified to be taxed as a real estate
investment trust pursuant to Sections 856-860 of the Code for each of
the taxable years ended December 31, 1992 through December 31, 1996,
and the Company's current
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<PAGE> 18
anticipated investments and its current plan of operation will enable
it to continue to meet the requirements for qualification and taxation
as a REIT under the Code; actual qualification of the Company as a
REIT, however, will depend upon the Company's continued ability to
meet, and its meeting, through actual annual operating results and
distributions, the various tests imposed under the Code.
(xi) The Company and the Subsidiaries are not in violation
of their certificates or articles of incorporation and bylaws or any
other similar organizational documents. To the best knowledge of such
counsel, neither the Company nor any of the Subsidiaries is in breach
of, or in default with respect to, any provisions of any agreement,
mortgage, deed of trust, lease, note, agreement, franchise, license,
indenture, permit or other instrument known to such counsel to which
the Company or any of the Subsidiaries is a party or by which the
Company or any of the Subsidiaries or any of the properties thereof
may be bound or affected which breach or default would have a material
adverse effect on the business or property of the Company and the
Subsidiaries taken as a whole or on the Company's ability to
consummate the transactions contemplated herein, and the Company and
the Subsidiaries are in material compliance with all judgments,
decrees and orders of any court to which the Company or any of the
Subsidiaries is subject, except where noncompliance would not have a
material adverse effect on the business of the Company and the
Subsidiaries taken as a whole.
Such counsel shall confirm that during the preparation of the
Registration Statement and Prospectus, such counsel has participated
in conferences with officers and other representatives of the Company,
representatives of the independent certified public accountants for
the Company and representatives of the Underwriters, at which time the
contents of the Registration Statement and Prospectus and related
matters were discussed and although such counsel is not opining with
respect to and does not assume any responsibility for the accuracy,
truthfulness, completeness or fairness of the statements contained in
the Registration Statement or Prospectus, such counsel confirms that
no facts have come to their attention which have caused them to
believe that either (i) the Prospectus or any supplement thereto as of
its date (other than numerical, financial or statistical data, the
financial statements and notes or any related schedules thereto, as to
which such counsel need express no opinion or belief) contains any
untrue statement of a material fact or omits 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 or (ii) the Registration Statement or any amendment
thereto at the time it became effective
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<PAGE> 19
(other than numerical, financial or statistical data, the
financial statements and notes or any related schedules
thereto, as to which such counsel need express no opinion or
belief contains any untrue statement of a material fact or
omits to state a material fact required to be stated therein
or necessary to make the statements therein not misleading.
In rendering the foregoing opinion, such counsel may expressly
state that it is qualified to render an opinion only as to matters
involving the Federal laws of the United States, the laws of the State
of California and may rely as to Maryland law on the opinion of
Venable, Baetjer and Howard, LLP which opinion must be reasonably
satisfactory to the Representatives and to Skadden, Arps, Slate,
Meagher & Flom LLP, counsel for the Underwriters, and as to all
matters of fact upon, among other things, certificates and written
statements of officers of the Company and government officials and the
representations and warranties of the Company contained herein;
provided that such counsel shall state that nothing has come to the
attention of such counsel that would reasonably cause such counsel to
believe that they and the Underwriters are not justified in relying
upon such certificates, statements, representations and warranties.
(g) On the Closing Date, you shall have received the
opinion of Willkie Farr & Gallagher, counsel for the Company,
addressed to you and dated the Closing Date, substantially to the
effect that:
(i) The Indenture has been duly authorized,
executed and delivered by the Company and constitutes a valid
and binding instrument of the Company enforceable in
accordance with its terms, except that the enforceability
thereof may be limited by or subject to (a) bankruptcy,
reorganization, insolvency, fraudulent conveyance, moratorium
or other similar laws now or hereafter existing which affect
the rights and remedies of creditors generally, and (b)
equitable principles of general applicability; and the
Indenture has been duly qualified under the Trust Indenture
Act. The Indenture conforms in all material respects to the
descriptions thereof contained in the Prospectus;
(ii) The Securities are in the form contemplated
in the Indenture, have been duly authorized by the Company for
issuance and sale to the Underwriters pursuant to this
Agreement and, when executed, authenticated, issued and
delivered in the manner provided for in this Agreement and the
Indenture, against payment of the consideration therefor
specified in this Agreement, the Securities will constitute
valid and legally binding obligations of the Company entitled
to the benefits of the Indenture and the Securities will be
enforceable against the Company in accordance with their
terms, except as enforceability thereof may be
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<PAGE> 20
limited by bankruptcy, insolvency, reorganization, fraudulent
conveyance, moratorium and other laws affecting creditors' rights
generally and by general principals of equity, regardless of whether
such enforceability is considered in a proceeding in equity or at law.
The terms of the Securities conform in all material respects to all
statements and descriptions related thereto in the Prospectus;
(iii) To the knowledge of such counsel, the Company is not
an "investment company" within the meaning of the Investment Company
Act of 1940, as amended; and
(iv) The statements in the Prospectus under "Description of
Notes" and "Underwriting", insofar as such statements describe matters
of law or legal conclusions, have been reviewed by such counsel and
are correct in all material respects.
In rendering the foregoing opinion, such counsel may expressly
state that it is qualified to render an opinion only as to matters involving
the Federal laws of the United States, the laws of the State of New York and
may rely as to Maryland law on the opinion of Venable, Baetjer and Howard, LLP
which opinion must be reasonably satisfactory to the Representatives and to
Skadden, Arps, Slate, Meagher & Flom LLP, counsel for the Underwriters, and as
to all matters of fact upon, among other things, certificates and written
statements of officers of the Company and government officials and the
representations and warranties of the Company contained herein; provided that
such counsel shall state that nothing has come to the attention of such counsel
that would reasonably cause such counsel to believe that they and the
Underwriters are not justified in relying upon such certificates, statements,
representations and warranties.
(h) On the Closing Date you shall have received, from
Skadden, Arps, Slate, Meagher & Flom LLP, counsel to the Underwriters, such
opinion, dated the Closing Date, with respect to corporate existence and good
standing of the Company, the validity of the Securities, the Registration
Statement, the Prospectus, and other related matters as you may reasonably
require; the Company shall have furnished to such counsel such documents as
they reasonably request for the purpose of enabling them to opine with respect
to such matters.
(i) On the date of this Agreement and on the Closing Date, you
shall have received from Ernst & Young LLP a letter or letters, dated the date
of this Agreement and the Closing Date, respectively, in form and substance
reasonably satisfactory to you, containing statements and information of the
type customarily included in accountants'
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<PAGE> 21
"comfort letters" to underwriters with respect to the financial
statements and certain financial information contained in and
incorporated by reference in the Registration Statement and the
Prospectus, including providing confirmation that they are independent
public accountants with respect to the Company within the meaning of
the Securities Act, and the answer to Item 509 of the Regulation S-K
set forth in the Registration Statement is correct insofar as it
relates to them, and providing a statement similar in substance to the
one set forth in Schedule IV hereto.
(j) on or prior to the Closing Date, the Company shall
have furnished to the Representatives such further certificates and
documents confirming the representations and warranties contained
herein and related matters as the Representatives shall reasonably
request.
The opinions and certificates mentioned in this Agreement shall be
deemed to be in compliance with the provisions hereof only if they are
reasonably satisfactory to the Representatives and to Skadden, Arps, Slate,
Meagher & Flom LLP, counsel for the Underwriters.
7. The Company agrees to indemnify and hold harmless each
Underwriter and each person, if any, who controls any Underwriter within the
meaning of either Section 15 of the Securities Act or Section 20 of the
Exchange Act, from and against any and all losses, claims, damages and
liabilities (including without limitation the reasonable legal fees and other
expenses incurred in connection with any suit, action or proceeding or any
claim asserted) caused by any untrue statement or alleged untrue statement of a
material fact contained in the Registration Statement or the Prospectus (as
amended or supplemented if the Company shall have furnished any amendments or
supplements thereto) or any preliminary prospectus, or caused by any omission
or alleged omission to state therein a material fact required to be stated
therein or necessary to make the statements therein not misleading, except
insofar as such losses, claims, damages or liabilities are caused by any untrue
statement or omission or alleged untrue statement or omission made in reliance
upon and in conformity with information relating to any Underwriter furnished
to the Company in writing by such Underwriter through the Representatives
expressly for use therein; provided, that the foregoing indemnity with respect
to any preliminary prospectus shall not inure to the benefit of any Underwriter
(or to the benefit of any person controlling such Underwriter) from whom the
person asserting any such losses, claims, damages or liabilities purchased
Securities if such untrue statement or omission or alleged untrue statement or
omission made in such preliminary prospectus is eliminated or remedied in the
Prospectus (as amended or supplemented if the Company shall have furnished any
amendments or supplements thereto) and, if required by law, a copy of the
Prospectus (as so amended or supplemented) shall not have been furnished to
such person at or prior to the written confirmation of the sale of such
Securities to such person.
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Each Underwriter agrees, severally and not jointly, to indemnify and
hold harmless the Company, its directors, its officers who sign the
Registration Statement and each person who controls the Company within the
meaning of Section 15 of the Securities Act and Section 20 of the Exchange Act,
to the same extent as the foregoing indemnity from the Company to each
Underwriter, but only with reference to information relating to such
Underwriter furnished to the Company in writing by such Underwriter through the
Representatives expressly for use in the Registration Statement, the
Prospectus, any amendment or supplement thereto, or any preliminary prospectus.
If any suit, action, proceeding (including any governmental or
regulatory investigation), claim or demand shall be brought or asserted against
any person in respect of which indemnity may be sought pursuant to either of
the two preceding paragraphs, such person (the "Indemnified Person") shall
promptly notify the person against whom such indemnity may be sought (the
"Indemnifying Person") in writing, and the Indemnifying Person, upon request of
the Indemnified Person, shall retain counsel reasonably satisfactory to the
Indemnified Person to represent the Indemnified Person and any others the
Indemnifying Person may designate in such proceeding and shall pay the
reasonable fees and expenses of such counsel related to such proceeding. In
any such proceeding, any Indemnified Person shall have the right to retain its
own counsel, but the fees and expenses of such counsel shall be at the expense
of such Indemnified Person unless (i) the Indemnifying Person and the
Indemnified Person shall have mutually agreed to the contrary, (ii) the
Indemnifying Person has failed within a reasonable time to retain counsel
reasonably satisfactory to the Indemnified Person or (iii) the named parties in
any such proceeding (including any impleaded parties) include both the
Indemnifying Person and the Indemnified Person and representation of both
parties by the same counsel would be inappropriate due to actual or potential
differing interests between them. It is understood that the Indemnifying
Person shall not, in connection with any proceeding or related proceeding in
the same jurisdiction, be liable for the fees and expenses of more than one
separate firm (in addition to any local counsel) for all Indemnified Persons,
and that all such fees and expenses shall be reimbursed as they are incurred.
Any such separate firm for the Underwriters and such control persons of
Underwriters shall be designated in writing by the first of the named
Representative on Schedule I hereto and any such separate firm for the Company,
its directors, its officers who sign the Registration Statement and such
control persons of the Company or authorized representatives shall be
designated in writing by the Company. The Indemnifying Person shall not be
liable for any settlement of any proceeding effected without its written
consent, but if settled with such consent or if there be a final judgment for
the plaintiff, the Indemnifying Person agrees to indemnify any Indemnified
Person from and against any loss or liability by reason of such settlement or
judgment. No Indemnifying Person shall, without the prior written consent of
the Indemnified Person, effect any settlement of any pending or threatened
proceeding in respect of which any Indemnified Person is or could have been a
party and indemnity could have been sought hereunder by such Indemnified
Person, unless such
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settlement includes an unconditional release of such Indemnified Person from
all liability on claims that are the subject matter of such proceeding.
If the indemnification provided for in the first and second paragraphs
of this Section 7 is unavailable to an Indemnified Person in respect of any
losses, claims, damages or liabilities referred to therein, then each
Indemnifying Person under such paragraph, in lieu of indemnifying such
Indemnified Person thereunder, shall contribute to the amount paid or payable
by such Indemnified Person as a result of such losses, claims, damages or
liabilities (i) in such proportion as is appropriate to reflect the relative
benefits received by the Company on the one hand and the Underwriters on the
other hand from the offering of the Securities or (ii) if the allocation
provided by clause (i) above is not permitted by applicable law, in such
proportion as is appropriate to reflect not only the relative benefits referred
to in clause (i) above but also the relative fault of the Company on the one
hand and the Underwriters on the other in connection with the statements or
omissions that resulted in such losses, claims, damages or liabilities, as well
as any other relevant equitable considerations. The relative benefits received
by the Company on the one hand and the Underwriters on the other shall be
deemed to be in the same respective proportions as the net proceeds from the
offering of such Securities (before deducting expenses) received by the Company
and the total underwriting discounts and the commissions received by the
Underwriters bear to the aggregate public offering price of the Securities.
The relative fault of the Company on the one hand and the Underwriters on the
other shall be determined by reference to, among other things, whether the
untrue or alleged untrue statement of a material fact or the omission or
alleged omission to state a material fact relates to information supplied by
the Company or by the Underwriters and the parties' relative intent, knowledge,
access to information and opportunity to correct or prevent such statement or
omission.
The Company and the Underwriters agree that it would not be just and
equitable if contribution pursuant to this Section 7 were determined by pro
rata allocation (even if the Underwriters were treated as one entity for such
purpose) or by any other method of allocation that does not take account of the
equitable considerations referred to in the immediately preceding paragraph.
The amount paid or payable by an Indemnified Person as a result of the losses,
claims, damages and liabilities referred to in the immediately preceding
paragraph shall be deemed to include, subject to the limitations set forth
above, any reasonable legal or other expenses incurred by such Indemnified
Person in connection with investigating or defending any such action or claim.
Notwithstanding the provisions of this Section 7, in no event shall an
Underwriter be required to contribute any amount in excess of the amount by
which the total price at which the Securities underwritten by it and
distributed to the public were offered to the public exceeds the amount of any
damages that such Underwriter has otherwise been required to pay by reason of
such untrue or alleged untrue statement or omission or alleged omission. No
person guilty of fraudulent misrepresentation (within the meaning of Section
11(f) of the
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Securities Act) shall be entitled to contribution from any person who was not
guilty of such fraudulent misrepresentation. The Underwriters' obligations to
contribute pursuant to this Section 7 are several in proportion to the
respective principal amount of the Securities set forth opposite their names in
Schedule I hereto, and not joint.
The indemnity and contribution agreements contained in this Section 7
are in addition to any liability which the Indemnifying Persons may otherwise
have to the Indemnified Persons referred to above.
The indemnity and contribution agreements contained in this Section 7
and the representations, warranties and covenants of the Company set forth in
this Agreement shall remain operative and in full force and effect regardless
of (i) any termination of this Agreement, (ii) any investigation made by or on
behalf of any Underwriter or any person controlling any Underwriter or by or on
behalf of the Company, its officers or directors or any other person
controlling the Company and (iii) acceptance of and payment for any of the
Securities.
8. Notwithstanding anything herein contained, this Agreement may
be terminated in the absolute discretion of the Representatives, by notice
given to the Company, if after the execution and delivery of this Agreement and
prior to the Closing Date (i) there shall have occurred, since the respective
dates as of which information is given in the Registration Statement and the
Prospectus, any material adverse change or any development involving a
prospective material adverse change in or affecting the condition, financial or
otherwise, of the Company or the earnings, business affairs, properties,
management or business prospects of the Company, whether or not arising in the
ordinary course of business, (ii) trading generally shall have been suspended
or materially limited on or by, as the case may be, any of the New York Stock
Exchange, the American Stock Exchange, the National Association of Securities
Dealers, Inc., the Chicago Board Options Exchange, the Chicago Mercantile
Exchange or the Chicago Board of Trade, (iii) trading of any securities of or
guaranteed by the Company shall have been suspended on any exchange or in any
over-the-counter market, (iv) a general moratorium on commercial banking
activities in New York shall have been declared by either Federal or New York
State authorities; (v) there has occurred any downgrading in the rating of the
Company's debt securities by any "nationally recognized statistical rating
organization" (as defined for purposes of Rule 436(g) under the Exchange Act);
or (vi) there shall have occurred any outbreak or escalation of hostilities or
any change in financial markets or any calamity or crisis that, in the judgment
of the Representatives, is material and adverse and which, in the judgment of
the Representatives, makes it impracticable to market the Securities on the
terms and in the manner contemplated in the Prospectus.
9. If, on the Closing Date, any one or more of the Underwriters
shall fail or refuse to purchase Securities which it or they have agreed to
purchase under this Agreement, and the
24
<PAGE> 25
aggregate principal amount of Securities which such defaulting Underwriter or
Underwriters agreed but failed or refused to purchase is not more than
one-tenth of the aggregate principal amount of the Securities, the other
Underwriters shall be obligated severally in the proportions that the principal
amount of Securities set forth opposite their respective names in Schedule I
hereto bears to the aggregate principal amount of Securities set forth opposite
the names of all such non-defaulting Underwriters, or in such other proportions
as the Representatives may specify, to purchase the Securities which such
defaulting Underwriter or Underwriters agreed but failed or refused to purchase
on such date; provided that in no event shall the principal amount of
Securities that any Underwriter has agreed to purchase pursuant to Section 1 be
increased pursuant to this Section 9 by an amount in excess of one-ninth of
such principal amount of Securities without the written consent of such
Underwriter. If, on the Closing Date, any Underwriter or Underwriters shall
fail or refuse to purchase Securities and the aggregate principal amount of
Securities with respect to which such default occurs is more than one-tenth of
the aggregate principal amount of Securities to be purchased, and arrangements
satisfactory to you and the Company for the purchase of such Securities are not
made within 36 hours after such default, this Agreement shall terminate without
liability on the part of any non-defaulting Underwriter or the Company. In any
such case either you or the Company shall have the right to postpone the
Closing Date, but in no event for longer than seven days, in order that the
required changes, if any, in the Registration Statement and in the Prospectus
or in any other documents or arrangements may be effected. Any action taken
under this paragraph shall not relieve any defaulting Underwriter from
liability in respect of any default of such Underwriter under this Agreement.
10. If this Agreement shall be terminated by the Underwriters, or
any of them, because of any failure or refusal on the part of the Company to
comply with the terms or to fulfill any of the conditions of this Agreement, or
if for any reason the Company shall be unable to perform its obligations under
this Agreement or any condition of the Underwriters' obligations cannot be
fulfilled, the Company agrees to reimburse the Underwriters or such
Underwriters as have so terminated this Agreement with respect to themselves,
severally, for all out-of- pocket expenses (including the fees and expenses of
their counsel) reasonably incurred by such Underwriters in connection with this
Agreement or the offering of Securities.
11. This Agreement shall inure to the benefit of and be binding
upon the Company, the Underwriters, any controlling persons referred to herein
and their respective successors and assigns. Nothing expressed or mentioned in
this Agreement is intended or shall be construed to give any other person, firm
or corporation any legal or equitable right, remedy or claim under or in
respect of this Agreement or any provision herein contained. No purchaser of
Securities from any Underwriter shall be deemed to be a successor by reason
merely of such purchase.
12. Any action by the Underwriters hereunder may be taken by you jointly or
by the
25
<PAGE> 26
first of the named Representative set forth in Schedule I hereto alone on
behalf of the Underwriters, and any such action taken by you jointly or by the
first of the named Representative set forth in Schedule I hereto alone shall be
binding upon the Underwriters. All notices and other communications hereunder
shall be in writing and shall be deemed to have been duly given if mailed or
transmitted by any standard form of telecommunication. Notices to the
Underwriters shall be given at the address set forth in Schedule II hereto.
Notices to the Company shall be given to it at Omega Healthcare Investors,
Inc., 905 West Eisenhower Circle, Suite 110, Ann Arbor, MI 48103, Attention:
President, facsimile number (313) 996-0020.
13. Miscellaneous. This Agreement may be signed in counterparts,
each of which shall be an original and all of which together shall constitute
one and the same instrument. This Agreement shall be governed by and construed
in accordance with the laws of the State of New York, without giving effect to
the conflicts of laws provisions thereof.
26
<PAGE> 27
Very truly yours,
Omega Healthcare Investors, Inc.
By: /s/ David A. Stover
--------------------------------
Name: David A. Stover
Title: Vice President, Chief
Financial Officer
Accepted: July 31, 1997
J.P. MORGAN SECURITIES INC.
By: /s/ Keysha Bailey
-------------------------
Name: Keysha Bailey
Title: Vice President
27
<PAGE> 28
SCHEDULE I
Representatives: J.P. Morgan Securities Inc.
Bear, Stearns & Co. Inc.
Underwriting Agreement dated: July 31, 1997
Registration Statement Nos.: 333-20967 and 333-
Title of Securities: 6.95% Notes due 2007
Aggregate principal amount: $100,000,000
Price to Public: 99.710% of the principal
amount of the Securities.
Underwriting Discount: 0.650%
Indenture: Indenture dated as of
January 28, 1997 and the
Supplemental Indenture dated
as of August 5, 1997, both
between Omega Healthcare
Investors, Inc. and NBD Bank
Maturity: August 1, 2007
Interest Rate: 6.95%
Interest Payment Dates: February 1 and August 1.
Sinking Fund Provisions: None
Closing Date and Time of Delivery: August 5, 1997
Closing Location: Skadden, Arps, Slate,
Meagher & Flom LLP,
919 Third Avenue,
New York, NY 10022
Address for Notices
to Underwriters: c/o J.P. Morgan Securities Inc.
60 Wall Street
New York, New York 10260
1
<PAGE> 29
SCHEDULE II
Underwriter Principal Amount
- ----------- To Be Purchased
----------------
J.P. Morgan Securities Inc. . . . . . . . . $ 75,000,000
Bear, Stearns & Co. Inc. . . . . . . . . . $ 25,000,000
=============
Total . . . . . . . . . . . . $ 100,000,000
1
<PAGE> 30
SCHEDULE III
Subsidiaries Place of Incorporation
- ------------ ----------------------
Bayside Street, Inc. Maryland
OHI (Kansas), Inc. Kansas
OHI (Illinois), Inc. Illinois
OHI (Florida), Inc. Florida
OHI (Clemmons), Inc. North Carolina
OHI (Greensboro), Inc. North Carolina
Sterling Acquisition Corp. Kentucky
Sterling Acquisition Corp. II Kentucky
OS Leasing Kentucky
Omega (UK) Limited London, England
1
<PAGE> 31
SCHEDULE IV
Pursuant to Section 6(i) of the Underwriting Agreement, Ernst
& Young LLP shall furnish letters to the Underwriters substantially to the
effect that:
(i) They are independent certified public
accountants with respect to the Company and the Subsidiaries within
the meaning of the Securities Act.
(ii) In their opinion, the financial statements
and any supplementary financial information and schedules (and, if
applicable, prospective financial statements and/or pro forma
financial information) examined by them and included in the Prospectus
or the Registration Statement comply as to form with the applicable
accounting requirements of the Securities Act with respect to
registration statements on Form S-3, and they have made a review in
accordance with standards established by the American Institute of
Certified Public Accountants of the interim financial statements,
selected financial data, prospective financial statements and/or
condensed financial statements derived from audited financial
statements of the Company and the Subsidiaries for the periods
specified in such letter, as indicated in their reports thereon,
copies of which have been furnished to the Representative of the
Underwriters (the "Representative")
(iii) On the basis of a reading of the unaudited
financial statements, pro forma financial statements and other
information contained in the Prospectus, a reading of the latest
available interim financial statements of the Company and the
Subsidiaries, inspection of the minute books of the Company and the
Subsidiaries since the date of the latest audited financial statements
included in the Prospectus, inquiries of officials of the Company and
the Subsidiaries responsible for financial and accounting matters and
such other inquiries and procedures as may be specified in such
letter, nothing came to their attention that caused them to believe
that:
(A) any of the above unaudited financial
statements or other information contained in the Prospectus do
not comply as to form with the accounting requirements of the
Securities Act or that such unaudited financial statements are
not fairly presented in conformity with generally accepted
accounting principles applied on a basis substantially
consistent with the audited financial statements;
(B) as of a specified date not more than
two days prior to the date of such letter, there have been any
changes in the capital stock or any increase in the
indebtedness of the Company and the Subsidiaries, or any
increases or decreases in net current assets or net assets or
any changes in any other items specified by the
Representative, in each case as compared with amounts shown in
the latest balance sheet included in the Prospectus, except in
each case for changes, increases or decreases which the
Prospectus discloses have occurred or may occur or which are
described in such letter; or
1
<PAGE> 32
(C) for the period from the date of the
latest financial statements included in the Prospectus to the
specified date referred to in clause (B) above there were any
decreases in revenues or the total or per share amounts of net
income, or any other changes in any items specified by the
Representative, in each case as compared with the comparable
period of the preceding year and with any other period of
corresponding length specified by the Representative, except
in each case for changes or decreases which the Prospectus
discloses have occurred or may occur or which are described in
such letter.
(iv) In addition to the audit referred to in their
report(s) included in the Prospectus and the limited procedures,
inspection of minute books, inquiries and other procedures referred to
in paragraph (iii) above, they have carried out certain specified
procedures, not constituting an audit in accordance with generally
accepted auditing standards, with respect to certain amounts,
percentages and financial information specified by the Representative,
which are derived from the general accounting records of the Company
and the Subsidiaries for the periods covered by their reports and any
interim or other periods since the latest period covered by their
reports, which appear in the Prospectus, or in Part II of, or in
exhibits and schedules to, the Registration Statement specified by the
Representative, and have compared certain of such amounts, percentages
and financial information with the accounting records of the Company
and the Subsidiaries and have found them to be in agreement.
2
<PAGE> 1
EXHIBIT 4
- --------------------------------------------------------------------------------
OMEGA HEALTHCARE INVESTORS, INC.
Issuer
to
NBD BANK
Trustee
-------------------------
Supplemental Indenture No. 1
Dated as of August 5, 1997
-------------------------
$100,000,000
of
6.95% Notes due 2007
- --------------------------------------------------------------------------------
<PAGE> 2
SUPPLEMENTAL INDENTURE NO. 1, dated as of August 5, 1997 (the
"Supplemental Indenture"), between OMEGA HEALTHCARE INVESTORS, INC., a
corporation duly organized and existing under the laws of the State of Maryland
(herein called the "Company"), and NBD BANK, a Michigan banking corporation
duly organized and existing under the laws of the State of Michigan, as Trustee
(herein called the "Trustee").
RECITALS OF THE COMPANY
The Company has heretofore delivered to the Trustee an
Indenture dated as of January 28, 1997 (the "Indenture"), a form of which has
been filed with the Securities and Exchange Commission under the Securities Act
of 1933, as amended, as an exhibit to the Company's Registration Statement on
Form S-3 (Registration No. 333-20967), providing for the issuance from time to
time of Debt Securities of the Company (the "Securities").
Section 301 of the Indenture provides for various matters with
respect to any series of Securities issued under the Indenture to be
established in an indenture supplemental to the Indenture.
Section 901(3) of the Indenture provides for the Company and
the Trustee to enter into an indenture supplemental to the Indenture to
establish the form or terms of Securities of any series as provided by Sections
201 and 301 of the Indenture, including any subordination provisions.
The Board of Directors of the Company has duly adopted
resolutions authorizing the Company to execute and deliver this Supplemental
Indenture.
All the conditions and requirements necessary to make this
Supplemental Indenture, when duly executed and delivered, a valid and binding
agreement in accordance with its terms and for the purposes herein expressed,
have been performed and fulfilled.
NOW, THEREFORE, THIS SUPPLEMENTAL INDENTURE WITNESSETH:
For and in consideration of the premises and the purchase of
the Securities provided for herein by the Holders thereof, it is mutually
covenanted and agreed, for the equal and proportionate benefit of all Holders
of the Notes, as follows:
ARTICLE ONE
RELATION TO INDENTURE; DEFINITIONS
SECTION 1.1. Relation to Indenture.
This Supplemental Indenture constitutes an integral part of
the Indenture.
<PAGE> 3
SECTION 1.2 Definitions.
For all purposes of this Supplemental Indenture, except as
otherwise expressly provided for or unless the context otherwise requires:
(1) Capitalized terms used but not defined herein shall
have the respective meanings assigned to them in the Indenture; and
(2) All references herein to Articles and Sections,
unless otherwise specified, refer to the corresponding Articles and
Sections of this Supplemental Indenture.
"Acquired Debt" means Debt of a Person (i) existing at the
time such Person becomes a Subsidiary or (ii) assumed in connection with the
acquisition of assets from such Person, in each case, other than Debt incurred
in connection with, or in contemplation of, such Person becoming a Subsidiary
or such acquisition. Acquired Debt shall be deemed to be incurred on the date
of the related acquisition of assets from any Person or the date the acquired
Person becomes a Subsidiary.
"Adjusted Total Assets" means the sum of (without duplication)
(i) the Total Assets of the Company and its Subsidiaries as of the end of the
most recent calendar quarter covered in the Company's Annual Report on Form
10-K or Quarterly Report on Form 10-Q, as the case may be, most recently filed
with the Commission (or, if such filing is not permitted under the Exchange
Act, with the Trustee) prior to the incurrence of such additional Debt and (ii)
the purchase price of any real estate assets or mortgages receivable acquired,
and the amount of any securities offering proceeds received (to the extent such
proceeds were not used to acquire real estate assets or mortgages receivable or
used to reduce Debt), by the Company or any Subsidiary since the end of such
calendar quarter, including those proceeds obtained in connection with the
incurrence of such additional Debt.
"Annual Service Charge" as of any date means the maximum
amount which is expensed in any 12-month period for interest on Debt of the
Company and its Subsidiaries.
"Business Day" means any day, other than a Saturday or Sunday,
that is neither a legal holiday nor a day on which banking institutions in the
City of New York or in the City of Detroit, Michigan are authorized or required
by law, regulation or executive order to close.
"Capital Stock" means, with respect to any Person, any capital
stock (including preferred stock), shares, interests, participations or other
ownership interests (however designated) of such Person and any rights (other
than debt securities convertible into or exchangeable for corporate stock),
warrants or options to purchase any thereof.
"Consolidated Income Available for Debt Service" for any
period means Earnings from Operations of the Company and its Subsidiaries plus
amounts which have been deducted, and minus amounts which have been added, for
the following (without duplication): (i) interest on Debt of the Company and
its Subsidiaries, (ii) provision for
2
<PAGE> 4
taxes of the Company and its Subsidiaries based on income, (iii) amortization
of debt discount and deferred financing costs, (iv) provisions for gains and
losses on properties and property depreciation and amortization, (v) the effect
of any noncash charge resulting from a change in accounting principles in
determining Earnings from Operations for such period, and (vi) amortization of
deferred charges.
"Debt" of the Company or any Subsidiary means, without
duplication, any indebtedness of the Company or any Subsidiary, whether or not
contingent, in respect of (i) borrowed money or evidenced by bonds, notes,
debentures or similar instruments, (ii) indebtedness for borrowed money of a
Person other than the Company or a Subsidiary which is secured by any
Encumbrance existing on property owned by the Company or any Subsidiary, (iii)
the reimbursement obligations, contingent or otherwise, in connection with any
letters of credit actually issued (other than letters of credit issued to
provide credit enhancement or support with respect to other indebtedness of the
Company or any Subsidiary otherwise reflected as Debt hereunder) or amounts
representing the balance deferred and unpaid of the purchase price of any
property or services, except any such balance that constitutes an accrued
expense or trade payable, or all conditional sale obligations or obligations
under any title retention agreement, (iv) the principal amount of all
obligations of the Company or any Subsidiary with respect to redemption,
repayment or other repurchase of any Disqualified Stock, or (v) any lease of
property by the Company or any Subsidiary as lessee which is reflected on the
Company's consolidated balance sheet as a capitalized lease in accordance with
GAAP, to the extent, in the case of items of indebtedness under (i) through
(iii) above, that any such items (other than letters of credit) would appear as
a liability on the Company's consolidated balance sheet in accordance with
GAAP, and also includes, to the extent not otherwise included, any obligation
by the Company or any Subsidiary to be liable for, or to pay, as obligor,
guarantor or otherwise (other than for purpose of collection in the ordinary
course of business), Debt of another Person (other than the Company or any
Subsidiary) (it being understood that Debt shall be deemed to be incurred by
the Company or any Subsidiary whenever the Company or such Subsidiary shall
create, assume, guarantee or otherwise become liable in respect thereof).
"Disqualified Stock" means, with respect to any Person, any
Capital Stock of such Person which by the terms of such Capital Stock (or by
the terms of any security into which it is convertible or for which it is
exchangeable or exercisable), upon the happening of any event or otherwise (i)
matures or is mandatorily redeemable, pursuant to a sinking fund obligation or
otherwise (other than Capital Stock which is redeemable solely in exchange for
common stock or shares), (ii) is convertible into or exchangeable or
exercisable for Debt or Disqualified Stock or (iii) is redeemable at the option
of the holder thereof, in whole or in part (other than Capital Stock which is
redeemable solely in exchange for common stock or shares), in each case on or
prior to the Stated Maturity of the Notes.
"Earnings from Operations" for any period means net earnings
excluding gains and losses on sales of investments, as reflected in the
financial statements of the Company and its Subsidiaries for such period,
determined on a consolidated basis in accordance with GAAP.
3
<PAGE> 5
"Encumbrance" means any mortgage, lien, charge, pledge or
security interest of any kind.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended, and the rules and regulations promulgated thereunder by the
Commission.
"GAAP" means generally accepted accounting principles as used
in the United States applied on a consistent basis as in effect from time to
time; provided that solely for purposes of any calculation required by the
financial covenants contained herein, "GAAP" shall mean generally accepted
accounting principles as used in the United States on the date hereof, applied
on a consistent basis.
"Government Obligations" means securities which are (i) direct
obligations of the United States of America, for the payment of which its full
faith and credit is pledged or (ii) obligations of a Person controlled or
supervised by and acting as an agency or instrumentality of the United States
of America, the payment of which is unconditionally guaranteed as a full faith
and credit obligation by the United States of America, which are not callable
or redeemable at the option of the issuer thereof, and shall also include a
depository receipt issued by a bank or trust company as custodian with respect
to any such Government Obligation held by such custodian for the account of the
holder of a depository receipt, provided that (except as required by law) such
custodian is not authorized to make any deduction from the amount payable to
the holder of such depository receipt from any amount received by the custodian
in respect of the Government Obligation or the specific payment of interest on
or principal of the Government Obligation evidenced by such depository receipt.
"Make-Whole Amount" means, in connection with any optional
redemption or accelerated payment of any Note, the excess, if any, of (i) the
aggregate present value as of the date of such redemption or accelerated
payment of each dollar of principal being redeemed or paid and the amount of
interest (exclusive of interest accrued to the date of redemption or
accelerated payment) that would have been payable in respect of such dollar if
such redemption or accelerated payment had not been made, determined by
discounting, on a semi-annual basis, such principal and interest at the
Reinvestment Rate (determined on the third Business Day preceding the date such
notice of redemption is given or declaration of acceleration is made) from the
respective dates on which such principal and interest would have been payable
if such redemption or accelerated payment had not been made, over (ii) the
aggregate principal amount of the Notes being redeemed or paid.
"Notes" has the meaning specified in Section 2.1 hereof.
"Reinvestment Rate" means .25% (twenty-five one hundredths of
one percent) plus the arithmetic mean of the yields under the respective
headings "This Week" and "Last Week" published in the Statistical Release under
the caption "Treasury Constant Maturities" for the maturity (rounded to the
nearest month) corresponding to the remaining life to maturity, as of the
payment date of the principal being redeemed or paid. If no maturity exactly
corresponds to such maturity, yields for the two published maturities most
closely corresponding to such maturity shall be calculated pursuant to the
immediately preceding sentence and the Reinvestment Rate shall be interpolated
or
4
<PAGE> 6
extrapolated from such yields on a straight-line basis, rounding in each of
such relevant periods to the nearest month. For such purposes of calculating
the Reinvestment Rate, the most recent Statistical Release published prior to
the date of determination of the Make-Whole Amount shall be used.
"Secured Debt" means Debt secured by an Encumbrance.
"Significant Subsidiary" has the meaning ascribed to such term
in Regulation S-X promulgated under the Securities Act of 1933, as amended.
"Statistical Release" means the statistical release designated
"H.15(519)" or any successor publication which is published weekly by the
Federal Reserve System and which establishes yields on actively traded United
States government securities adjusted to constant maturities or, if such
statistical release is not published at the time of any determination of the
Make-Whole Amount, then such other reasonably comparable index which shall be
designated by the Company.
"Subsidiary" means, with respect to any Person, any
corporation or other entity of which a majority of (i) the voting power of the
voting equity securities, or (ii) the outstanding equity interests of which are
owned, directly or indirectly, by such Person. For the purposes of this
definition, "voting equity securities" means equity securities having voting
power for the election of directors, whether at all times or only so long as no
senior class of security has such voting power by reason of any contingency.
"Total Assets" as of any date means the sum of (i) the
Undepreciated Real Estate Assets and (ii) all other assets of the Company and
its Subsidiaries determined in accordance with GAAP (but excluding accounts
receivable and intangibles).
"Total Unencumbered Assets" means the sum of (i) those
Undepreciated Real Estate Assets not subject to an Encumbrance for borrowed
money and (ii) all other assets of the Company and its Subsidiaries not subject
to an Encumbrance for borrowed money, determined in accordance with GAAP (but
excluding accounts receivable and intangibles).
"Undepreciated Real Estate Assets" as of any date means the
cost (original cost plus capital improvements) of real estate assets of the
Company and its Subsidiaries on such date, before depreciation and
amortization, determined on a consolidated basis in accordance with GAAP.
"Unsecured Debt" means Debt which is not secured by any
Encumbrance upon any of the properties of the Company or any Subsidiary.
5
<PAGE> 7
ARTICLE TWO
THE SERIES OF NOTES
SECTION 2.1. Title of the Securities.
There shall be a series of Securities designated the "6.95%
Notes due 2007" (the "Notes").
SECTION 2.2. Limitation on Aggregate Principal Amount.
The aggregate principal amount of the Notes shall be limited
to $100,000,000, and, except as provided in this Section and in Section 306 of
the Indenture, the Company shall not execute and the Trustee shall not
authenticate or deliver Notes in excess of such aggregate principal amount.
Nothing contained in this Section 2.2 or elsewhere in this
Supplemental Indenture, or in the Notes, is intended to or shall limit
execution by the Company or authentication or delivery by the Trustee of Notes
under the circumstances contemplated by Sections 303, 304, 305, 306, 905 and
1107 of the Indenture.
SECTION 2.3. Interest and Interest Rates; Maturity Date of
Notes.
The Notes will bear interest at a rate of 6.95% per annum from
August 5, 1997 or from the immediately preceding Interest Payment Date to which
interest has been paid or duly provided for, payable semi-annually in arrears
on February 1 and August 1 of each year, commencing February 1, 1998 (each, an
"Interest Payment Date"), to the Person in whose name such Note is registered
at the close of business on January 15 or July 15 (whether or not a Business
Day), as the case may be, next preceding such Interest Payment Date (each, a
"Regular Record Date"). Interest will be computed on the basis of a 360-day
year comprised of twelve 30-day months. The interest so payable on any Note
which is not punctually paid or duly provided for on any Interest Payment Date
shall forthwith cease to be payable to the Person in whose name such Note is
registered on the relevant Regular Record Date, and such defaulted interest
shall instead be payable to the Person in whose name such Note is registered on
the Special Record Date or other specified date determined in accordance with
the Indenture.
If any Interest Payment Date or Maturity falls on a day that
is not a Business Day, the required payment shall be made on the next Business
Day as if it were made on the date such payment was due and no interest shall
accrue on the amount so payable for the period from and after such Interest
Payment Date or Maturity, as the case may be.
The Notes will mature on August 1, 2007.
6
<PAGE> 8
SECTION 2.4. Limitations on Incurrence of Debt.
(a) The Company will not, and will not permit any
Subsidiary to, incur any Debt if, immediately after giving effect to the
incurrence of such additional Debt and the application of the proceeds thereof,
the aggregate principal amount of all outstanding Debt of the Company and its
Subsidiaries on a consolidated basis determined in accordance with GAAP is
greater than 60% of Adjusted Total Assets.
(b) In addition to the limitation set forth in subsection
(a) of this Section 2.4, the Company will not, and will not permit any
Subsidiary to, incur any Debt if the ratio of Consolidated Income Available for
Debt Service to the Annual Service Charge for the four consecutive fiscal
quarters most recently ended prior to the date on which such additional Debt is
to be incurred shall have been less than 1.5x, on a pro forma basis after
giving effect thereto and to the application of the proceeds therefrom, and
calculated on the assumption that (i) such Debt and any other Debt incurred by
the Company and its Subsidiaries since the first day of such four-quarter
period and the application of the proceeds therefrom, including to refinance
other Debt, had occurred at the beginning of such period; (ii) the repayment or
retirement of any other Debt by the Company and its Subsidiaries since the
first day of such four-quarter period had been repaid or retired at the
beginning of such period (except that, in making such computation, the amount
of Debt under any revolving credit facility shall be computed based upon the
average daily balance of such Debt since the first day of such four-quarter
period); (iii) in the case of Acquired Debt or Debt incurred in connection with
any acquisition since the first day of such four-quarter period, the related
acquisition had occurred as of the first day of such period with the
appropriate adjustments with respect to such acquisition being included in such
pro forma calculation; and (iv) in the case of any acquisition or disposition
by the Company or its Subsidiaries of any asset or group of assets since the
first day of such four-quarter period, whether by merger, stock purchase or
sale, or asset purchase or sale, such acquisition or disposition or any related
repayment of Debt had occurred as of the first day of such period with the
appropriate adjustments with respect to such acquisition or disposition being
included in such pro forma calculation.
(c) In addition to the limitations set forth in
subsections (a) and (b) of this Section 2.4, the Company will not, and will not
permit any Subsidiary to, incur any Secured Debt if, immediately after giving
effect to the incurrence of such additional Secured Debt and the application of
the proceeds thereof, the aggregate principal amount of all outstanding Secured
Debt of the Company and its Subsidiaries on a consolidated basis is greater
than 40% of Adjusted Total Assets.
(d) The Company and its Subsidiaries will maintain Total
Unencumbered Assets of not less than 200% of the aggregate outstanding
principal amount of the Unsecured Debt of the Company and its Subsidiaries on a
consolidated basis.
(e) For purposes of this Section 2.4, Debt shall be
deemed to be "incurred" by the Company or a Subsidiary whenever the Company or
such Subsidiary shall create, assume, guarantee or otherwise become liable in
respect thereof.
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SECTION 2.5. Redemption.
The Notes may be redeemed at any time at the option of the
Company, in whole or in part, at a redemption price equal to the sum of (i) the
principal amount of the Notes being redeemed plus accrued interest thereon to
the Redemption Date and (ii) the Make-Whole Amount, if any, with respect to
such Notes (the "Redemption Price").
SECTION 2.6. Places of Payment.
The Places of Payment where the Notes may be presented or
surrendered for payment, where the Notes may be surrendered for registration of
transfer or exchange and where notices and demands to and upon the Company in
respect of the Notes and the Indenture may be served shall be at the office of
the Trustee located at NBD Bank, 611 Woodward Avenue, Detroit, Michigan 48226
Attention: Corporate Trust Department.
SECTION 2.7. Method of Payment.
For so long as the Notes are issued in the form of Global Debt
Securities, payment of principal of and interest on such Notes will be made
through the Depositary for such Debt Securities. In the event the Notes are
issued in definitive form, or the Depositary with respect to any Global Debt
Securities is unable to effect payment of principal and interest on such Notes,
payment of principal and interest on such Notes will be made at the office or
agency of the Trustee maintained for such purpose. In either case, payment of
the principal of and interest on the Notes will be made in such coin or
currency of the United States of America as at the time of payment is legal
tender for payment of public and private debts; provided, however, that at the
option of the Company, payments of principal and interest on the Notes (other
than payments of principal and interest due at Maturity) may be made (i) by
check mailed to the address of the Person entitled thereto as such address
shall appear in the Security Register or (ii) by wire transfer to an account
maintained by the Person entitled thereto located within the United States.
SECTION 2.8. Currency.
Principal and interest on the Notes shall be payable in U.S.
Dollars.
SECTION 2.9. Registered Securities; Global Form.
The Notes shall be issuable and transferable in fully
registered form as Registered Debt Securities, without coupons. The Notes
shall each be issued in the form of one or more permanent Global Debt
Securities. The Depository for the Notes shall be The Depository Trust Company
("DTC"). The Notes shall not be issuable in definitive form except as provided
in Section 305 of the Indenture.
SECTION 2.10. Form of Notes.
The Notes shall be substantially in the form attached as
Exhibit A hereto.
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SECTION 2.11. Registrar and Paying Agent.
The Trustee shall initially serve as the Debt Securities
Registrar and Paying Agent for the Notes.
SECTION 2.12. Defeasance.
(a) The following Article Fifteen shall be added to the
Indenture.
ARTICLE FIFTEEN -- DEFEASANCE AND COVENANT DEFEASANCE
SECTION 1501. Applicability of Article: Company's Option to
Effect Defeasance or Covenant Defeasance. If, pursuant to Section 301,
provision is made for either or both of (a) defeasance of the Debt Securities
of or within a series under 1502 or (b) covenant defeasance of the Debt
Securities of or within a series under Section 1503, then the provisions of
such Section or Sections, as the case may be, together with the other
provisions of this Article (with such modifications thereto as may be specified
pursuant to Section 301 with respect to any Debt Securities), shall be
applicable to such Debt Securities, and the Company may at its option by Board
Resolution, at any time, with respect to such Debt Securities, elect to have
Section 1502 (if applicable) or Section 1503 (if applicable) be applied to such
Outstanding Debt Securities upon compliance with the conditions set forth below
in this Article.
SECTION 1502. Defeasance and Discharge. Upon the Company's
exercise of the above option applicable to this Section with respect to any
Debt Securities of or within a series, the Company shall be deemed to have been
discharged from its obligations with respect to such Outstanding Debt
Securities on the date the conditions set forth in Section 1504 are satisfied
(hereinafter, "defeasance"). For this purpose, such defeasance means that the
Company shall be deemed to have paid and discharged the entire indebtedness
represented by such Outstanding Debt Securities, which shall thereafter be
deemed to be "Outstanding" only for the purposes of Section 1505 and the other
Sections of this Indenture referred to in clauses (A) and (B) below, and to
have satisfied all of its other obligations under such Debt Securities and this
Indenture insofar as such Debt Securities are concerned (and the Trustee, at
the expense of the Company, shall execute proper instruments acknowledging the
same), except for the following which shall survive until otherwise terminated
or discharged hereunder: (A) the rights of Holders of such Outstanding Debt
Securities to receive, solely from the trust fund described in Section 1504 and
as more fully set forth in such Section, payments in respect of the principal
of (and premium or Make-Whole Amount, if any) and interest, if any, on such
Debt Securities when such payments are due, (B) the Company's obligations with
respect to such Debt Securities under Sections 305, 306, 1002 and 1003, and
Article Thirteen (C) the rights, powers, trusts, duties and immunities of the
Trustee hereunder and (D) this Article. Subject to compliance with this
Article Fifteen, the Company may exercise its option under this Section
notwithstanding the prior exercise of its option under Section 1503 with
respect to such Debt Securities.
SECTION 1503. Covenant Defeasance. Upon the Company's
exercise of the above option applicable to this Section with respect to any
Debt Securities of or within a series, the Company shall be released from its
obligations under Sections 1004
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<PAGE> 11
and Sections 1006 to 1008, inclusive, and, if specified pursuant to Section
301, its obligations under any other covenant contained herein or in any
indenture supplemental, with respect to such Outstanding Debt Securities
thereto on and after the date the conditions set forth in Section 1504 are
satisfied (hereinafter, "covenant defeasance"), and such Debt Securities shall
thereafter be deemed to be not "Outstanding" for the purposes of any direction,
waiver, consent or declaration or Act of Holders (and the consequences of any
thereof) in connection with Sections 1004 and Sections 1006 to 1008, inclusive,
or such other covenant, but shall continue to be deemed "Outstanding" for all
other purposes hereunder. For this purpose, such covenant defeasance means
that, with respect to such Outstanding Debt Securities, the Company may omit to
comply with and shall have no liability in respect of any term, condition or
limitation set forth in any such Section or such other covenant, whether
directly or indirectly, by reason of any reference elsewhere herein to any such
Section or other covenant or by reason of reference in any such Section or such
other covenant to any other provision herein or in any other document and such
omission to comply shall not constitute a default or an Event of Default under
Section 501(4) or 501(9) or otherwise, as the case may be, but, except as
specified above, the remainder of this Indenture and such Debt Securities shall
be unaffected thereby.
SECTION 1504. Conditions to Defeasance or Covenant
Defeasance. The following shall be the conditions to application of Section
1502 or Section 1503 to any Outstanding Debt Securities of or within a series:
(a) The Company shall irrevocably have deposited or caused to
be deposited with the Trustee (or another trustee satisfying the requirements
of Section 608 who shall agree to comply with the provisions of this Article
Fifteen applicable to it) as trust funds in trust for the purpose of making the
following payments, specifically pledged as security for, and dedicated solely
to, the benefit of the Holders of such Debt Securities, (1) an amount in such
currency, currencies or currency unit in which such Debt Securities are then
specified as payable at Stated Maturity, or (2) Government Obligations
applicable to such Debt Securities (determined on the basis of the currency,
currencies or currency unit in which such Debt Securities are then specified as
payable at Stated Maturity) which through the scheduled payment of principal
and interest in respect thereof in accordance with their terms will provide,
not later than the due date of any payment of principal of (and premium or
Make-Whole Amount, if any) and interest, if any, on such Debt Securities, money
in an amount, or (3) a combination thereof, in any case, in an amount,
sufficient, without consideration of any reinvestment of such principal and
interest, in the opinion of a nationally recognized firm of independent public
accountants expressed in written certification thereof delivered to the
Trustee, to pay and discharge, and which shall be applied by the Trustee (or
other qualifying trustee) to pay and discharge, (i) the principal of (and
premium or Make-Whole Amount, if any) and interest, if any, on such Outstanding
Debt Securities on the Stated Maturity of such principal or installment of
principal or interest and (ii) any mandatory sinking fund payments or analogous
payments applicable to such Outstanding Debt Securities on the day on which
such payments are due and payable in accordance with the terms of this
Indenture and of such Debt Securities.
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<PAGE> 12
(b) Such defeasance or covenant defeasance shall not result
in a breach or violation of, or constitute a default under, this Indenture or
any other material agreement or instrument to which the Company is a party or
by which it is bound.
(c) No Event of Default or event which with notice or lapse
of time or both would become an Event of Default with respect to such Debt
Securities shall have occurred and be continuing on the date of such deposit
or, insofar as Sections 501(5) and 501(6) are concerned, at any time during the
period ending on the 91st day after the date of such deposit (it being
understood that this condition shall not be deemed satisfied until the
expiration of such period).
(d) In the case of an election under Section 1502, the
Company shall have delivered to the Trustee an Opinion of Counsel stating that
(i) the Company has received from, or there has been published by, the Internal
Revenue Service a ruling, or (ii) since the date of execution of this
Indenture, there has been a change in the applicable Federal income tax law, in
either case to the effect that, and based thereon such opinion shall confirm
that, the Holders of such Outstanding Debt Securities will not recognize
income, gain or loss for Federal income tax purposes as a result of such
defeasance and will be subject to Federal income tax on the same amounts, in
the same manner and at the same times as would have been the case if such
defeasance had not occurred.
(e) In the case of an election under Section 1503, the
Company shall have delivered to the Trustee an Opinion of Counsel to the effect
that the Holders of such Outstanding Debt Securities will not recognize income,
gain or loss for Federal income tax purposes as a result of such covenant
defeasance and will be subject to Federal income tax on the same amounts, in
the same manner and at the same times as would have been the case if such
covenant defeasance had not occurred.
(f) The Company shall have delivered to the Trustee an
Officers' Certificate and an Opinion of Counsel, each stating that all
conditions precedent to the defeasance under Section 1502 or the covenant
defeasance under Section 1503 (as the case may be) have been complied with and
an Opinion of Counsel to the effect that either (i) as a result of a deposit
pursuant to subsection (a) above and the related exercise of the Company's
option under Section 1502 or Section 1503 (as the case may be), registration
is not required under the Investment Company Act of 1940, as amended, by the
Company, with respect to the trust funds representing such deposit or by the
Trustee for such trust funds or (ii) all necessary registrations under said Act
have been effected.
(g) Notwithstanding any other provisions of this Section,
such defeasance or covenant defeasance shall be effected in compliance with any
additional or substitute terms, conditions or limitations which may be imposed
on the Company in connection therewith pursuant to Section 301.
SECTION 1505. Deposited Money and Government Obligations to
Be Held in Trust; Other Miscellaneous Provisions. Subject to the provisions of
the last paragraph of Section 1003, all money and Government Obligations (or
other property as may be provided pursuant to Section 301) (including the
proceeds thereof) deposited with the Trustee (or other qualifying trustee,
collectively for purposes of this Section 1505,
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<PAGE> 13
the "Trustee") pursuant to Section 1504 in respect of any Outstanding Debt
Securities of any series shall be held in trust and applied by the Trustee, in
accordance with the provisions of such Debt Securities and this Indenture, to
the payment, either directly or through any Paying Agent (including the Company
acting as its own Paying Agent) as the Trustee may determine, to the Holders of
such Debt Securities of all sums due and to become due thereon in respect of
principal (and premium or Make-Whole Amount, if any) and interest, but such
money need not be segregated from other funds except to the extent required by
law.
Unless otherwise specified with respect to any Debt Security
pursuant to Section 301, if, after a deposit referred to in Section 1504(a) has
been made, (a) the Holder of a Debt Security in respect of which such deposit
was made is entitled to, and does, elect pursuant to Section 301 or the terms
of such Debt Security to receive payment in a currency or currency unit other
than that in which the deposit pursuant to Section 1504(a) has been made in
respect of such Debt Security, or (b) a Conversion Event occurs in respect of
the currency or currency unit in which the deposit pursuant to Section 1504(a)
has been made, the indebtedness represented by such Debt Security shall be
deemed to have been, and will be, fully discharged and satisfied through the
payment of the principal of (and premium or Make-Whole Amount, if any),
interest, if any, on such Security as the same becomes due out of the proceeds
yielded by converting (from time to time as specified below in the case of any
such election) the amount or other property deposited in respect of such
Security into the currency or currency unit in which such Debt Security becomes
payable as a result of such election or Conversion Event based on the
applicable market exchange rate for such currency or currency unit in effect on
the second Business Day prior to each payment date, except, with respect to a
Conversion Event, for such currency or currency unit in effect (as nearly as
feasible) at the time of the Conversion Event.
The Company shall pay and indemnify the Trustee against any
tax, fee or other charge imposed on or assessed against the Government
Obligations deposited pursuant to Section 1504 or the principal and interest
received in respect thereof other than any such tax, fee or other charge which
by law is for the account of the Holders of such Outstanding Debt Securities.
Anything in this Article to the contrary notwithstanding,
subject to Section 607, the Trustee shall deliver or pay to the Company from
time to time upon Company Request any money or Government Obligations (or other
property and any proceeds therefrom) held by it as provided in Section 1504
which, in the opinion of a nationally recognized firm of independent public
accountants expressed in a written certification thereof delivered to the
Trustee, are in excess of the amount thereof which would then be required to be
deposited to effect a defeasance or covenant defeasance, as applicable, in
accordance with this Article.
(b) The provisions of Sections 1502 and 1503 of the
Indenture, together with the other provisions of Article Fifteen of the
Indenture, shall be applicable to the Notes. The provisions of Section 1503 of
the Indenture shall apply to the covenants set
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<PAGE> 14
forth in Sections 2.4 and 2.16 of this Supplemental Indenture and to those
covenants specified in Section 1503 of the Indenture.
SECTION 2.13. Events of Default
The provisions of clauses (2), (5) and (6) of Section 501 of
the Indenture as applicable with respect to the Notes shall be deemed to be
amended and restated in its entirety to read as follows:
(2) default in the payment of the principal of (or
Make-Whole Amount, if any,) on any Notes when due and payable; or
(5) a receiver, liquidator, assignee, custodian, trustee,
conservator, sequestrator or other similar official shall take possession of
the Company or any Significant Subsidiary or any substantial part of its
property without its consent, or the entry of a decree or order for relief by a
court having jurisdiction in the premises in respect of the Company or any
Significant Subsidiary in an involuntary case under the Federal Bankruptcy Code
or any other applicable Federal or State law, or appointing a receiver,
liquidator, custodian, assignee, trustee, sequestrator, conservator, or other
similar official of the Company or any Significant Subsidiary or of any
substantial part of its property, or ordering the winding up or liquidation of
its affairs, and the continuance of any such possession, decree or order
unstayed and in effect for a period of 60 consecutive days; or
(6) the commencement by the Company or any Significant
Subsidiary of a voluntary case under the Federal Bankruptcy Code or any other
applicable Federal or State law, or the consent by either of the foregoing to
the entry of an order for relief in an involuntary case under any such law, or
the consent to the appointment of or taking possession by a receiver,
liquidator, assignee, custodian, trustee, conservator, sequestrator or other
similar official or of any substantial part of its property, or the making of
an assignment for the benefit of creditors; or
The provisions of Section 501 of the Indenture as applicable
with respect to the Notes shall be further deemed to be amended by renumbering
existing clause (7) to be clause (9) and by adding the following new clauses
(7) and (8):
(7) default under any bond, debenture, note, mortgage,
indenture or instrument under which there may be issued or by which there may
be secured or evidenced any indebtedness for money borrowed by the Company (or
by any Subsidiary, the repayment of which the Company has guaranteed or for
which the Company is directly responsible or liable as obligor or guarantor),
having an aggregate principal amount outstanding of at least $10,000,000,
whether such indebtedness now exists or shall hereafter be created, which
default shall have resulted in such indebtedness becoming or being declared due
and payable prior to the date on which it would otherwise have become due and
payable, without such indebtedness having been discharged, or such acceleration
having been rescinded or annulled, within a period of 10 days after there shall
have given, by registered or certified mail, to the Company by the Trustee or
to the Company and the Trustee by the Holders of at least 10% in principal
amount of the Outstanding Notes a written notice specifying such default and
requiring the Compa-
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<PAGE> 15
ny to cause such indebtedness to be discharged or cause such acceleration to be
rescinded or annulled and stating that such notice is a "Notice of Default"
hereunder; or
(8) the entry by a court of competent jurisdiction of one
or more judgments, orders or decrees against the Company or any of its
Subsidiaries in an aggregate amount (excluding amounts covered by insurance) in
excess of $10,000,000 and such judgements, orders or decrees remain
undischarged, unstayed and unsatisfied in an aggregate amount (excluding
amounts covered by insurance) in excess of $10,000,000 for a period of 30
consecutive days; or
SECTION 2.14. Acceleration of Maturity; Rescission and
Annulment.
The provisions of the first paragraph of Section 502 of the
Indenture as applicable with respect to the Notes shall be deemed to be amended
and restated in their entirety to read as follows:
If an Event of Default with respect to Debt Securities of any
series at the time Outstanding occurs and is continuing, then in every such
case the Trustee or the Holders of not less than 25% in principal amount of the
Outstanding Notes may declare the principal (or, if any Debt Securities are
Original Issue Discount Securities or Indexed Securities, such portion of the
principal as may be specified in the terms thereof) of, and the Make-Whole
Amount, if any, on, all the Notes to be due and payable immediately, by a
notice in writing to the Company (and to the Trustee if given by the Holders),
and upon any such declaration such principal or specified portion thereof shall
become immediately due and payable. If an Event of Default with respect to the
Notes set forth in Section 501(6) of the Indenture occurs and is continuing,
then in every such case all the Notes shall become immediately due and payable,
without notice to the Company, at the principal amount thereof (or, if any
Notes are Original Issue Discount Securities or Indexed Securities, such
portion of the principal as may be specified in the terms thereof) plus accrued
interest to the date the Notes are paid plus the Make-Whole Amount, if any, on
the Notes.
SECTION 2.15. Provision of Financial Information.
Whether or not the Company is subject to Section 13 or 15(d)
of the Exchange Act, the Company will, to the extent permitted under the
Exchange Act, file with the Commission the annual reports, quarterly reports
and other documents which the Company would have been required to file with the
Commission pursuant to such Section 13 or 15(d) if the Company were so subject,
such documents to be filed with the Commission on or prior to the respective
dates (the "Required Filing Dates") by which the Company would have been
required so to file such documents if the Company were so subject.
The Company will also in any event (x) within 15 days after
each Required Filing Date (i) if the Company is not then subject to Section 13
or 15(d) of the Exchange Act, transmit by mail to all Holders, as their names
and addresses appear in the Debt Securities Register, without cost to such
Holders, copies of the annual reports and quarterly reports which the Company
would have been required to file with the Commission pursuant to Section 13 or
15(d) of the Exchange Act if the Company were
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<PAGE> 16
subject to such Sections, and (ii) file with the Trustee copies of annual
reports, quarterly reports and other documents which the Company would have
been required to file with the Commission pursuant to Section 13 or 15(d) of
the Exchange Act if the Company were subject to such Sections and (y) if filing
such documents by the Company with the Commission is not permitted under the
Exchange Act, promptly upon written request and payment of the reasonable cost
of duplication and delivery, supply copies of such documents to any prospective
Holder.
SECTION 2.16. Additional Covenant; Waiver of Certain Covenants.
(a) The following Section 1008 shall be added to Article Ten
of the Indenture:
SECTION 1008. EXISTENCE. Subject to Article Eight, the
Company will do or cause to be done all things necessary to preserve and keep
in full force and effect its corporate existence, all material rights (by
articles of incorporation, by-laws and statute) and material franchises;
provided, however, that the Company shall not be required to preserve any such
right or franchise if the Board of Directors shall determine that the
preservation thereof is no longer desirable in the conduct of the business of
the Company.
(b) Notwithstanding the provisions of Section 1005 of the
Indenture, the Company may omit in any particular instance to comply with any
term, provision or condition set forth in Sections 1004 and Sections 1006 to
1008, inclusive, of the Indenture, with Sections 2.4 and 2.15 of this
Supplemental Indenture and with any other term, provision or condition with
respect to the Notes (except any such term, provision or condition which could
not be amended without the consent of all Holders of the Notes), if before or
after the time for such compliance the Holders of at least a majority in
principal amount of all outstanding Notes or such series thereof, as
applicable, by Act of such Holders, either waive such compliance in such
instance or generally waive compliance with such covenant or condition. Except
to the extent so expressly waived, and until such waiver shall become
effective, the obligations of the Company and the duties of the Trustee in
respect of any such term, provision or condition shall remain in full force and
effect.
SECTION 2.17. Immunity of Stockholders, Directors, Officers
and Agents of the Company.
The following Section 115 shall be added to Article One of the
Indenture:
SECTION 115. IMMUNITY OF STOCKHOLDERS, DIRECTORS, OFFICERS
AND AGENTS OF THE COMPANY. No recourse under or upon any obligation, covenant
or agreement contained in this Indenture, or in any Debt Security, or because
of any indebtedness evidenced thereby, shall be had against any past, present
or future stockholder, employee, officer or director, as such, of the Company
or of any successor, either directly or through the Company or any successor,
under any rule of law, statute or constitutional provision or by the
enforcement of any assessment or by any legal or equitable proceeding or
otherwise, all such liability being expressly waived and released
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<PAGE> 17
by the acceptance of the Debt Securities by the Holders and as part of the
consideration for the issue of the Debt Securities.
SECTION 2.18. Make-Whole Amount. The Indenture shall be
amended such that in each instance where the payment of "premium" is mentioned
with respect to any Debt Security, such term shall also refer to the Make-Whole
Amount.
ARTICLE THREE
MISCELLANEOUS PROVISIONS
SECTION 3.1. Ratification of Indenture.
Except as expressly modified or amended hereby, the Indenture
continues in full force and effect and is in all respects confirmed and
preserved.
SECTION 3.2. Governing Law.
This Supplemental Indenture and each Note shall be governed by
and construed in accordance with the laws of the State of New York. This
Supplemental Indenture is subject to the provisions of the Trust Indenture Act
of 1939, as amended, and shall, to the extent applicable, be governed by such
provisions.
SECTION 3.3. Counterparts.
This Supplemental Indenture may be executed in any number of
counterparts, each of which so executed shall be deemed to be an original, but
all such counterparts shall together constitute but one and the same
instrument.
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<PAGE> 18
IN WITNESS WHEREOF, the parties hereto have caused this
Supplemental Indenture to be duly executed by their respective officers
hereunto duly authorized, all as of the day and year first written above.
OMEGA HEALTHCARE INVESTORS, INC.
By:
--------------------------------
Name:
Title:
NBD BANK
as Trustee
By:
--------------------------------
Name:
Title:
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<PAGE> 19
EXHIBIT A TO
SUPPLEMENTAL INDENTURE
UNLESS THIS SECURITY IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), 55 WATER STREET, NEW
YORK, NEW YORK, TO THE COMPANY (AS DEFINED BELOW) OR ITS AGENT FOR REGISTRATION
OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN
THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER
ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER,
PLEDGE, OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS
WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST
HEREIN.
THIS SECURITY IS A GLOBAL SECURITY WITHIN THE MEANING SET FORTH IN THE
INDENTURE HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF DTC OR A
NOMINEE OF DTC. THIS SECURITY IS EXCHANGEABLE FOR SECURITIES REGISTERED IN THE
NAME OF A PERSON OTHER THAN DTC OR ITS NOMINEE ONLY IN THE LIMITED
CIRCUMSTANCES DESCRIBED IN THE INDENTURE, AND MAY NOT BE TRANSFERRED EXCEPT AS
A WHOLE BY DTC TO A NOMINEE OF DTC OR ANOTHER NOMINEE OF DTC OR BY DTC OR ITS
NOMINEE TO A SUCCESSOR DEPOSITORY OR ITS NOMINEE.
Registered No. ________ PRINCIPAL AMOUNT
CUSIP No.: ____________ $[__________]
OMEGA HEALTHCARE INVESTORS, INC.
6.95% NOTE DUE 2007
OMEGA HEALTHCARE INVESTORS, INC., a corporation duly organized
and existing under the laws of the State of Maryland (herein referred to as the
"Company" which term shall include any successor corporation under the
Indenture hereinafter referred to), for value received, hereby promises to pay
to CEDE & CO., or registered assigns, upon presentation, the principal sum of
[____________] MILLION DOLLARS on August 1, 2007 and to pay interest on the
outstanding principal amount thereon from August 5, 1997, or from the
immediately preceding Interest Payment Date to which interest has been paid or
duly provided for, semi-annually in arrears on February 1 and August 1 in each
year, commencing February 1, 1998, at the rate of 6.95% per annum, until the
entire principal hereof is paid or made available for payment. The interest so
payable and punctually paid or duly provided for on any Interest Payment Date
will, as provided in the Indenture, be paid to the Person in whose name this
Security is registered at the close of business on the Regular Record Date for
such interest which shall be the January 15 or July 15 (whether or not a
Business Day), as the case may be, next preceding such Interest Payment Date.
Any such interest not so punctually paid or duly provided for shall forthwith
cease to be payable to the Holder on such Regular Record Date, and may either
be paid to the Person in whose name this Security is registered at the close of
business on a Special Record Date for the payment of such Defaulted Interest to
be fixed by the Trustee, notice whereof shall be given to Holders of the
Securities not more than 15 days and not less than 10 days prior to such
Special Record Date, or may be paid at any time in any other lawful manner not
inconsistent with the requirements of any securities exchange on which the
Securities may be listed, and
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<PAGE> 20
upon such notice as may be required by such exchange, all as more fully
provided in the Indenture. Payment of the principal of and interest on this
Security will be made at the office or agency maintained for that purpose in
the City of New York, New York, or elsewhere as provided in the Indenture, in
such coin or currency of the United States of America as at the time of payment
is legal tender for payment of public and private debts; provided, however,
that at the option of the Company payments of principal and interest on the
Notes (other than payments of principal and interest due at Maturity) may be
made (i) by check mailed to the address of the Person entitled thereto as such
address shall appear in the Security Register or (ii) by wire transfer to an
account of the Person entitled thereto located within the United States.
Securities of this series are one of a duly authorized issue
of securities of the Company (herein called the "Securities"), issued and to be
issued in one or more series under an Indenture, dated as of January 28, 1997,
as supplemented by Supplemental Indenture No. 1, dated as of August 5, 1997 (as
so supplemented, herein called the "Indenture"), between the Company and NBD
Bank (herein called the "Trustee," which term includes any successor trustee
under the Indenture), to which Indenture and all indentures supplemental
thereto reference is hereby made for a statement of the respective rights,
limitations of rights, duties and immunities thereunder of the Company, the
Trustee and the Holders of the Securities and of the terms upon which the
Securities are authenticated and delivered. This Security is one of the series
designated in the first page thereof, limited in aggregate principal amount to
$100,000,000.
Securities of this series may be redeemed at any time at the
option of the Company, in whole or in part, upon notice of not more than 60 nor
less than 30 days prior to the Redemption Date, at a redemption price equal to
the sum of (i) the principal amount of the Securities being redeemed plus
accrued interest thereon to the Redemption Date and (ii) the Make-Whole Amount,
if any, with respect to such Securities.
The Indenture contains provisions for defeasance at any time
of (a) the entire indebtedness of the Company on this Security, and (b) certain
restrictive covenants and the related defaults and Events of Default applicable
to the Company, in each case, upon compliance by the Company with certain
conditions set forth in the Indenture, which provisions apply to this Security.
If an Event of Default with respect to the Securities shall
occur and be continuing, the principal of the Securities may be declared due
and payable in the manner and with the effect provided in the Indenture.
As provided in and subject to the provisions of the Indenture,
the Holder of this Security shall not have the right to institute any
proceeding with respect to the Indenture or for the appointment of a receiver
or trustee or for any other remedy thereunder, unless such Holder shall have
previously given written notice to the Trustee of a continuing Event of Default
with respect to the Securities, the Holders of not less than 25% in principal
amount of the Securities of this series at the time Outstanding shall have made
written request to the Trustee to institute proceedings in respect of such
Event of Default as Trustee and offered the Trustee reasonable indemnity and
the Trustee shall not have received from the Holders of a majority in principal
amount of Securities of this series at the time Outstanding a direction
inconsistent with such request, and shall have
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<PAGE> 21
failed to institute any such proceeding, for 60 days after receipt of such
notice, request and offer of indemnity. The foregoing shall not apply to any
suit instituted by the Holder of this Security for the enforcement of any
payment of principal hereof or any interest on or after the respective due
dates expressed herein.
The Indenture permits, with certain exceptions as therein
provided, the amendment thereof and the modification of the rights and
obligations of the Company and the rights of the Holders of the Securities of
each series to be affected under the Indenture at any time by the Company and
the Trustee with the consent of the Holders of not less than a majority in
principal amount of the Outstanding Securities of each series of Securities
then Outstanding affected thereby. The Indenture also contains provisions
permitting the Holders of specified percentages in principal amount of the
Securities of each series at the time Outstanding, on behalf of the Holders of
all Securities of such series, to waive compliance by the Company with certain
provisions of the Indenture and certain past defaults under the Indenture and
their consequences. Any such consent or waiver by the Holder of this Security
shall be conclusive and binding upon such Holder and upon all future Holders of
this Security and of any Security issued upon the registration of transfer
hereof or in exchange herefor or in lieu hereof, whether or not notation of
such consent or waiver is made upon this Security.
No reference herein to the Indenture and no provision of this
Security or of the Indenture shall alter or impair the obligation of the
Company, which is absolute and unconditional, to pay the principal of (and
Make-Whole Amount, if any) and interest on this Security at the times, place
and rate, and in the coin or currency, herein prescribed.
As provided in the Indenture and subject to certain
limitations therein set forth, the transfer of this Security is registrable in
the Security Register, upon surrender of this Security for registration of
transfer at the office or agency of the Company in any Place of Payment where
the principal of (and Make-Whole Amount, if any) and interest on this Security
are payable, duly endorsed by, or accompanied by a written instrument of
transfer in form satisfactory to the Company and the Debt Securities Registrar
duly executed by the Holder hereof or his attorney duly authorized in writing,
and thereupon one or more new Securities of this series, of authorized
denominations and for the same aggregate principal amount, will be issued to
the designated transferee or transferees.
The Securities of this series are issuable only in registered
form without coupons in denominations of $1,000 and any integral multiple
thereof. As provided in the Indenture and subject to certain limitations
therein set forth, Securities of this series are exchangeable for a like
aggregate principal amount of Securities of this series of a different
authorized denomination, as requested by the Holder surrendering the same.
No service charge shall be made for any such registration of
transfer or exchange, but the Company may require payment of a sum sufficient
to cover any tax or other governmental charge payable in connection therewith.
Prior to due presentment of this Security for registration of
transfer, the Company, the Trustee and any agent of the Company or the Trustee
may treat the Person in whose name this Security is registered as the owner
hereof for all purposes, whether or
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<PAGE> 22
not this Security be overdue, and neither the Company, the Trustee nor any such
agent shall be affected by notice to the contrary.
No recourse under or upon any obligation, covenant or
agreement contained in the Indenture or in this Security, or because of any
indebtedness evidenced hereby or thereby, shall be had against any promoter, as
such, or against any past, present or future shareholder, officer or director,
as such, of the Company or of any successor, either directly or through the
Company or any successor, under any rule of law, statute or constitutional
provision or by the enforcement of any assessment or by any legal or equitable
proceeding or otherwise, all such liability being expressly waived and released
by the acceptance of this Security by the Holder thereof and as part of the
consideration for the issue of the Securities of this series.
All capitalized terms used in this Security which are defined
in the Indenture shall have the meanings assigned to them in the Indenture.
THE INDENTURE AND THE SECURITIES, INCLUDING THIS SECURITY,
SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF
NEW YORK.
Pursuant to a recommendation promulgated by the Committee on
Uniform Security Identification Procedures, the Company has caused "CUSIP"
numbers to be printed on the Securities of this series as a convenience to the
Holders of such Securities. No representation is made as to the correctness or
accuracy of such CUSIP numbers as printed on the Securities, and reliance may
be placed only on the other identification numbers printed hereon.
Unless the certificate of authentication hereon has been
executed by or on behalf of the Trustee by manual signature, this Security
shall not be entitled to any benefit under the Indenture or be valid or
obligatory for any purpose.
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<PAGE> 23
IN WITNESS WHEREOF, OMEGA HEALTHCARE INVESTORS, INC. has
caused this instrument to be duly executed under its corporate seal.
Dated:
OMEGA HEALTHCARE INVESTORS, INC.
By:
----------------------------------
Name:
Title:
[Corporate Seal]
Attest:
- ---------------------------------
Secretary
TRUSTEE'S CERTIFICATE OF AUTHENTICATION:
This is one of the Securities of the series designated therein
referred to in the within-mentioned Indenture.
NBD BANK
as Trustee
By:
----------------------------------
Authorized Signatory
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<PAGE> 24
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ASSIGNMENT FORM
FOR VALUE RECEIVED, the undersigned hereby
sells, assigns and transfers unto
PLEASE INSERT SOCIAL
SECURITY OR OTHER IDENTIFYING
NUMBER OF ASSIGNEE
/ /. . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(Please Print or Typewrite Name and Address including
Zip Code of Assignee)
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
the within Security of Omega Healthcare Investors, Inc. and hereby does
irrevocably constitute and appoint
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Attorney to transfer said Security on the books of the within-named Company
with full power of substitution in the premises.
Dated: . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . .
MEDALLION SIGNATURE GUARANTEE
NOTICE: The signature to this assignment must correspond with the name as it
appears on the first page of the within Security in every particular, without
alteration or enlargement or any change whatever.
================================================================================
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