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EXHIBIT 10.5
AMENDED AND RESTATED ADVISORY AGREEMENT
BETWEEN
PRINCIPAL HEALTHCARE FINANCE LIMITED
AND
OMEGA HEALTHCARE INVESTORS, INC.
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TABLE OF CONTENTS
1. DUTIES OF THE ADVISOR. .............................................1
2. NO PARTNERSHIP OR JOINT VENTURE......................................3
3. RECORDS..............................................................3
4. BANK ACCOUNTS........................................................3
5. BOND.................................................................4
6. INFORMATION FURNISHED ADVISOR........................................4
7. CONSULTATION AND ADVICE..............................................4
8. ANNUAL BUSINESS PLAN AND BUDGET......................................4
9. DEFINITIONS..........................................................5
10. INVESTED ASSETS FEE; INCENTIVE FEE..................................6
11. STATEMENTS..........................................................7
12. COMPENSATION FOR ADDITIONAL SERVICES................................7
13. EXPENSES OF THE ADVISOR.............................................7
14. EXPENSES OF THE COMPANY.............................................8
15. OTHER ACTIVITIES OF ADVISOR.........................................9
16. TERM; TERMINATION OF AGREEMENT.....................................10
17. AMENDMENTS.........................................................11
18. DEFAULT, BANKRUPTCY, ETC...........................................11
19. ASSIGNMENT.........................................................11
20. ACTION UPON TERMINATION............................................12
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21. LIMITS OF ADVISOR RESPONSIBILITY...................................12
22. NOTICES............................................................13
23. HEADINGS...........................................................14
24. GOVERNING LAW; CONSENT TO JURISDICTION.............................14
25. JOINDER............................................................15
26. ENTIRE AGREEMENT...................................................15
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THE ADVISORY AGREEMENT ("Agreement") dated as of July 21, 1995 between
PRINCIPAL HEALTHCARE FINANCE LIMITED, a company incorporated with limited
liability under the laws of Jersey (the "Company"), and OMEGA HEALTHCARE
INVESTORS, INC., a Maryland corporation (the "Advisor") is hereby amended and
restated effective as of November __, 1997 in its entirety to read as follows:
RECITALS:
A. The Company is a limited liability company under the laws of Jersey,
formed to acquire real estate in the United Kingdom to be used for the provision
of health care services, which real estate will be leased to and operated by
independent health care operators.
B. The Advisor is engaged in the United States in the business of
owning and leasing health care facilities to third party operators and in making
mortgage loans to such third party operators.
C. The Advisor and its employees have extensive experience in the
administration of real estate assets used to provide health care services and
the origination, structuring and evaluation of real estate and mortgage
investments and leasing activities related to the health care industry.
D. The Company and the Advisor have agreed to amend certain of the
terms of the Agreement, and in connection therewith, to amend and restate the
Agreement in its entirety.
NOW THEREFORE, in consideration of the premises and of the mutual
covenants herein contained, the parties agree as follows:
1. DUTIES OF THE ADVISOR. The Advisor shall provide such services and
activities relating to the assets, operations and business plans of the Company
as may be appropriate, including:
(a) assisting in the preparation of annual budgets and business
plans for approval by the Board of Directors of the Company (the "Business
Plans");
(b) using its best efforts to present to the Company a continuing
investment program consistent with the investment policies and objectives of the
Company as set forth in the Business Plans;
(c) using its best efforts to present to the Company investment
opportunities consistent with the Business Plans and such investment program as
the Board of Directors may adopt from time to time;
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(d) furnishing or obtaining and supervising the performance of the
ministerial functions in connection with the administration of the day-to-day
operations of the Company, including the investment of reserve funds and surplus
cash in short-term money market investments;
(e) serving as one of the Company's investment and financial
advisors and providing research, economic, and statistical data in connection
with the Company's investments and investment and financial policies;
(f) assisting the Company in investigating, selecting and
negotiating with borrowers, lenders, mortgagors, brokers, investors, builders,
developers and others;
(g) consulting with the Directors of the Company and furnishing the
Directors with advice and recommendations with respect to the making, acquiring
(by purchase, investment, exchange, or otherwise), holding, and disposition
(through sale, exchange, or otherwise) of investments consistent with the
Business Plans of the Company;
(h) advising the Directors of the Company with respect to such
services as may be required in acquiring and disposing of investments,
disbursing and collecting the funds of the Company, paying the debts and
fulfilling the obligations of the Company, and handling, prosecuting, and
settling any claims of the Company, including foreclosing and otherwise
enforcing leases and mortgages and other liens securing investments;
(i) assisting the Company in obtaining such services as may be
required for property management, loan disbursements, and other activities
relating to the investments of the Company, provided, however, the compensation
for such services shall be agreed to by the Company and the service provider;
(j) advising the Company in connection with capital market
activities, but in no event in such a way that the Advisor could be deemed to be
acting as a broker-dealer or underwriter or subject to the jurisdiction of any
governmental authority;
(k) quarterly, and at any time requested by the Board of Directors
of the Company, making reports to the Board of Directors of the Company
regarding the Company's performance to date in relation to the Company's current
approved Business Plan and its various components, as well as the Advisor's
performance of its services under this Agreement;
(l) making or providing appraisal reports, where appropriate, on
investments or contemplated investments of the Company;
(m) assisting in preparation of reports and other documents
necessary to satisfy the reporting and other requirements of any governmental
bodies or agencies and assisting in maintaining effective communications with
shareholders of the Company; and
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(n) doing all things necessary to ensure its ability to render the
services contemplated herein, including providing office space and office
furnishings, computing and accounting equipment and personnel necessary for the
performance of the foregoing services as Advisor, all at its own expense, except
as otherwise expressly provided for herein.
In performing its services under this Agreement, the Advisor acknowledges
that it is doing so pursuant to a delegation of day to day management by the
Board of Directors of the Company, which delegation remains under the
supervision and control of the Board of Directors of the Company, and further
that the Board of Directors of the Company and not the Advisor maintains
ultimate authority for the conduct of the business of the Company. The Company
acknowledges that the Advisor shall perform its services under this Agreement
primarily through facilities, personnel and support services located at its
United States offices through personnel of Advisor's selection.
In performing its services under this Agreement, the Advisor may utilize
facilities, personnel and support services of various of its Affiliates, whether
located within or outside of the United Kingdom. The Advisor shall reimburse
such Affiliates for their services and facilities out of the compensation
provided for in Section 10 hereof. Notwithstanding the above, the Company may
request, and will pay for the direct costs of, additional services (as described
in Section 12 of this Agreement). As set forth in Section 15 of this Agreement,
the Advisor will engage in numerous other activities related to real estate and
not related to the Company or its assets.
2. NO PARTNERSHIP OR JOINT VENTURE. The Company and the Advisor are not
partners or joint venturers with each other, and nothing herein shall be
construed so as to make them such partners or joint venturers or impose any
liability as such on either of them. Nothing contained in this Agreement shall
authorize either party to act as agent or representative of the other party or
to authorize either party to create any obligation on behalf of the other party.
3. RECORDS. At all times the Advisor shall keep proper books of account and
records of the Company's affairs which shall be accessible for inspection by the
Company at the Advisor's principal office in the United States and in at any
time during ordinary business hours.
4. BANK ACCOUNTS. The Advisor may establish and maintain one or more bank
accounts in its own name, and may collect and deposit into any such account or
accounts, and disburse from any such account or accounts, any money on behalf of
the Company, under such terms and conditions as the Board of Directors of the
Company may approve, provided that no funds in any such account shall be
commingled with funds of the Advisor or another party; and the Advisor shall
from time to time render appropriate accounting of such collections and payments
to the Board of Directors of the Company and to the auditors of the Company.
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5. BOND. If required by the Board of Directors of the Company, the Advisor
shall maintain a fidelity bond with a responsible surety company in such amount
as may be required by the Board of Directors of the Company from time to time,
covering all directors, officers, employees, and agents of the Advisor handling
funds of the Company and any investment documents or records pertaining to
investments of the Company. Such bond shall inure to the benefit of the Company
in respect to losses of any such property from acts of such directors, officers,
employees, and agents through theft, embezzlement, fraud, negligence, error, or
omission or otherwise, the premium for said bond to be at the expense of the
Company. If any director of the Company is an Affiliate of the Advisor, the
approval of a majority of the Board of Directors of the Company who are not so
affiliated shall be required for the Company to require such a bond for the
Advisor.
6. INFORMATION FURNISHED ADVISOR. The Board of Directors of the Company
shall have the right to change a Business Plan at any time. The Board of
Directors of the Company shall promptly furnish a copy of any changes to any
Business Plan to the Advisor. The Company shall furnish the Advisor with a
certified copy of all financial statements, a signed copy of each report
prepared by independent certified public accountants, and such other information
with regard to the Company's affairs as the Advisor may from time to time
reasonably request.
7. CONSULTATION AND ADVICE. In addition to the services described above,
the Advisor shall consult with the Board of Directors of the Company, and shall,
at the request of the Board of Directors, furnish advice and recommendations
with respect to any aspect of the business and affairs of the Company, including
any factors that in the Advisor's best judgment should influence the policies of
the Company. The Advisor and the Company shall confer as required concerning the
Advisor's staffing and personnel assigned to perform the services of the Advisor
hereunder, with the goal that the Advisor employ highly qualified professional
staff, in whom both the Advisor and the Company repose confidence and trust.
8. ANNUAL BUSINESS PLAN AND BUDGET. The Advisor shall assist the Company in
the preparation of a Business Plan for each Fiscal Year of the Company for
submission to the Board of Directors of the Company. Such Business Plan shall
include a twelve-month projection of operations and cash flow with explicit
assumptions and a general plan for asset sales or acquisitions, leasing,
lending, foreclosure and borrowing activity, other investments or ventures and
proposed securities offerings or repurchases or any proposed restructuring of
the Company. To the extent possible, the Business Plan shall set forth the
Advisor's recommendations and the basis therefor with respect to all material
investments of the Company. Upon approval by the Board of Directors of the
Company, the Advisor shall advise and assist in the conduct of the business of
the Company in accordance with the explicit provisions of the Business Plan,
specifically including the borrowing, leasing, maintenance, capital
improvements, renovations and sale of investments set forth in the Business
Plan. Within forty five (45) days of the end of each calendar quarter, the
Advisor shall provide the Board of Directors of the Company with a report
comparing the Company's actual performance for such quarter against the Business
Plan.
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9. DEFINITIONS. As used herein, the following terms shall have the meanings
set forth below:
(a) "Adjusted Consolidated Net Income" shall mean for any fiscal
period, the consolidated net income for the Company and its consolidated
subsidiaries, (i) increased by (x) the amount of income allocable to such fiscal
period from zero-coupon investments or similar deferred payment investments and
(y) the amount of any increase in appraisal write-up valuation of assets of the
Company and its consolidated subsidiaries as reported in annual valuations for
such fiscal period and decreased by the amount of any reduction in appraisal of
assets of the Company and its consolidated subsidiaries as reported in annual
valuations for such fiscal period.
(b) "Aggregate Book Value of Invested Assets" shall mean the Book
Value of Invested Assets for all of the following as a group: (i) the Company;
(ii) each Person that is an Affiliate of the Company; and (iii) each
Securitization Entity.
(c) "Affiliate" shall mean, as to any Person, any other Person
which owns beneficially, directly, or indirectly, 10% or more of the outstanding
capital stock, shares or equity interests of such Person or of any other Person
which controls, is controlled by, or is under common control with such Person or
is an officer, retired officer, director, employee, or partner of such Person or
of any other Person which controls, is controlled by, or is under common control
with, such Person.
(d) "Book Value" of an asset or assets shall mean the value of such
asset or assets as recorded on the books of any Person, (i) before any appraisal
write-up in accordance with United Kingdom GAAP; (ii) before provision for
amortization, depreciation, depletion or valuation reserves; and (iii) deducting
any indebtedness or other liability in respect thereof.
(e) "Book Value of Invested Assets" shall mean the Book Value of
the total assets of any nature or description owned, leased, managed or operated
by any Person (without deduction of any liabilities), but excluding (i) goodwill
and other intangible assets, (ii) cash, and (iii) cash equivalent investments
with terms which mature in one year or less, and increased by the amount of any
increase in appraisal write-up of assets of the Company and its consolidated
subsidiaries as reported in annual valuations for such fiscal period and
decreased by the amount of any reduction in appraisal of assets of the Company
and its consolidated subsidiaries as reported in annual valuations for such
fiscal period.
(f) "Business Plan" shall mean the Company's investment policies
and objectives and the capital and operating budget based thereon for the
relevant fiscal year of the Company as approved by the Board of Directors of the
Company, as thereafter modified or amended.
(g) "Change of Control" shall mean, as to the Advisor, (i) the
election to the board of directors of the Advisor in a contested election of
directors of individuals comprising a majority of directors who, immediately
prior to the contested election, were not members of the
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board of directors of the Advisor, or (ii) a change in the duties of the
Chairman and/or the Chief Executive Officer of the Advisor, which change
precludes the active involvement of such officer or officers of the Advisor in
the performance of the Advisor's services under this Agreement.
(h) "Earnings per Share" shall mean the Adjusted Consolidated Net
Income of the Company for any fiscal period, divided -by the weighted average
number of ordinary shares outstanding for such fiscal period.
(i) "Invested Assets" shall mean the assets of any Person which are
managed by the Advisor.
(j) "Leases" shall mean all leases and subleases from the Company
and its Affiliates to third party lessees and sublessees.
(k) "Mortgage Loans" shall mean notes, debentures, bonds, and other
evidences of indebtedness or obligations, whether negotiable or non-negotiable,
and which are secured or collateralized by mortgages, including first,
wraparound, construction and development, and junior mortgages.
(l) "Person" shall mean and include individuals, corporations,
limited partnerships, general partnerships, limited liability companies, joint
stock companies or associations, joint ventures, associations, companies,
trusts, banks, trust companies, land trusts, business trusts, or other entities
and governments and agencies and political subdivisions thereof.
(m) "Real Property" shall mean and include land, rights in land,
leasehold interests (including but not limited to interests of a lessor or
lessee therein), and any buildings, structures, improvements, fixtures, and
equipment located on or used in connection with land, leasehold interests, and
rights in land or interests therein.
(n) "Securitization Entity" shall mean any Person formed or availed
of for the purposes of financing and/or acquiring assets now owned, leased,
managed and/or operated by or to be owned, leased, managed and/or operated by
the Company or any Affiliate of the Company.
All calculations made pursuant to this Agreement shall be based on
statements (which may be unaudited, except as provided herein) prepared on an
accrual basis consistent with United Kingdom generally accepted accounting
principles, regardless of whether the Company may also prepare statements on a
different basis.
10. INVESTED ASSETS FEE; INCENTIVE FEE. On or before the twenty-eighth day
of each month during the term hereof, the Company shall pay to the Advisor, as
compensation for the management and advisory services rendered to the Company
hereunder, a fee at the rate of 0.075% per month of the average of the Aggregate
Book Value of the Invested Assets ("Invested Assets Fee") at the beginning and
at the end of the next preceding calendar month.
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The annual rate of the Invested Assets Fee shall be 0.90% per annum.
Notwithstanding the foregoing, to the extent Invested Assets include assets held
by a Securitization Entity, the Invested Assets Fee with respect to such assets
shall accrue monthly and be paid semi-annually (i) in advance on the date of
closing of the securitization and (ii) thereafter on the date the Securitization
Entity makes a regularly scheduled payment of interest and/or principal.
On or before the first day of the third calendar month following the
Company's receipt of its audited financial statements for the prior fiscal year,
the Company's auditors (or other third party acceptable to the Advisor and the
Company) shall determine whether the Earnings Per Share for the fiscal year then
ended based on fully diluted weighted shares outstanding exceeded by at least
twenty percent (20%) the Earnings Per Share for the preceding fiscal year (the
"Target Earnings Per Share"). In the event the Company shall have achieved
Target Earnings Per Share for any Fiscal Year, then the Company shall pay to the
Advisor an Incentive Fee equal to two-tenths of one percent (0.2%) of the
average of Aggregate Book Value of Invested Assets. For purposes of the
Incentive Fee, the average of Aggregate Book Value of Invested Assets shall be
determined as the average of the Aggregate Book Value of Invested Assets on the
first day of the fiscal year and the Aggregate Book Value of Invested Assets on
the last day of the fiscal year.
Certain expenses and reimbursements described in Sections 13 and 14 of
this Agreement may be allocated in part to the account of the Advisor and in
part to the account of the Company, as may be agreed by the parties hereto.
11. STATEMENTS. Upon request, the Advisor shall furnish to the Company not
later than the tenth (10th) day of each calendar month, beginning with the
second (2nd) calendar month of the term of this Agreement, a statement showing
the computation of the fees, if any, payable in respect to the next preceding
calendar month.
12. COMPENSATION FOR ADDITIONAL SERVICES. If and to the extent that the
Company shall request the Advisor or any director, officer, partner, or employee
of the Advisor or Affiliates of the Advisor to render services for the Company
other than those required to be rendered by the Advisor hereunder, such
additional services, if performed, will be compensated separately on terms to be
agreed upon between such party and the Company from time to time.
13. EXPENSES OF THE ADVISOR. The Advisor shall bear the following
expenses, (subject to the allocation provisions of Section 10 of this
Agreement):
(a) employment expenses of the personnel employed by the Advisor
including, but not limited to, fees, salaries, wages, payroll taxes, travel
expenses, and the cost of employee benefit plans and temporary help expenses
(including fees, salaries, and expenses paid to directors, officers, and
employees of the Advisor who are also directors, officers or employees of the
Company, when acting in such capacities as directors, officers or employees of
the Advisor);
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(b) advertising and promotional expenses incurred in seeking
investments for the Company;
(c) rent, telephone, utilities, office furniture and furnishings,
and other office expenses of the Advisor;
(d) the cost of any internal accounting, statistical, bookkeeping
or computer equipment or computer time necessary for maintaining the books and
records of the Company; and
(e) miscellaneous administrative expenses relating to performance
by the Advisor of its functions hereunder.
14. EXPENSES OF THE COMPANY. The Company shall pay all of its expenses not
assumed by or allocated to the Advisor, including without limitation, the
following expenses:
(a) the cost of money borrowed by the Company;
(b) income taxes, taxes and assessments on real property, and all
other taxes applicable to the Company;
(c) legal, auditing, accounting (other than internal accounting),
preparing all tax returns, underwriting, brokerage, listing, registration and
other fees, printing, and engraving and other expenses, and taxes incurred in
connection with the issuance, distribution, transfer, registration, and stock
exchange listing of the Company's securities;
(d) fees, salaries, and expenses paid to directors, officers, and
employees of the Company;
(e) fees and expenses paid to independent advisors, independent
contractors, mortgage services, consultants, managers, local property managers
or management firms, accountants, attorneys and other agents employed by or on
behalf of the Company;
(f) expenses directly connected with the origination or purchase of
Mortgage Loans and with the acquisition, disposition, and ownership of real
estate equity interests, Leases or other property, including the costs of
foreclosure, insurance, legal, protective, brokerage, maintenance, repair, and
property improvement services;
(g) expenses of maintaining and managing real estate equity
interests;
(h) insurance, as required by the Board of Directors of the Company
(including Board of Directors' liability insurance for the Directors);
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(i) the expenses of organizing, revising, amending, converting,
modifying, or terminating the Company;
(j) expenses connected with payments of dividends or interest or
distributions in cash or any other form made or caused to be made by the Board
of Directors of the Company to holders of securities of the Company;
(k) all expenses connected with communications to holders of
securities of the Company and the other bookkeeping and clerical work necessary
in maintaining relations with holders of securities, including the cost of
printing and mailing certificates for securities and proxy solicitation
materials and reports to holders of the Company's securities;
(l) the cost of any outside auditing necessary for maintaining the
books and records of the Company and the costs for preparing and filing all
required tax returns;
(m) transfer agent's, registrar's, and indenture trustee's fees and
charges;
(n) legal, accounting, investment banking, and auditing fees and
expenses charged by independent parties for services provided to the Company;
(o) out of pocket expenses incurred by the Advisor, arising from
the sales of Company properties, including those expenses related to carrying
out foreclosure and lease termination proceedings;
(p) costs and expenses associated with risk management (i.e.
insurance relating to the Company's assets);
(q) loan refinancing compensation; and
(r) expenses associated with special services requested by the
Board of Directors of the Company pursuant to Section 12 hereof.
15. OTHER ACTIVITIES OF ADVISOR. Except as provided in the last sentence
of this paragraph of this Section 15, the Advisor, its officers, directors, or
employees or any of its Affiliates (and such Affiliate's officers, directors, or
employees) may engage in other business activities related to real estate
investments or act as advisor to any other Person, including those with
investment policies similar to the Company, and the Advisor and its officers,
directors, or employees and any of its Affiliates (and such Affiliate's
officers, directors, or employees) shall be free from any obligation to present
to the Company any particular investment opportunity that comes to the Advisor
or such persons, regardless of whether such opportunity is in accordance with
the Company's Business Plans. In addition, nothing herein shall prevent any
director, officer or employee of the Advisor, or any Affiliate (and such
Affiliate's officers, directors, or
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employees) from engaging in any other business or from rendering services of any
kind to any other Person (including competitive business activities).
Notwithstanding the foregoing, neither the Company nor its Affiliates, nor their
respective directors, officers, or employees, shall act as an advisor to, or
agree to act as an advisor to, any other Person with respect to real property
located in the United Kingdom and used for health care purposes, without the
prior written consent of the Board of Directors of the Company.
Directors, officers, employees and agents of the Advisor or of its
affiliates may serve as directors, employees, agents, nominees or signatories of
the Company. When executing documents or otherwise acting in such capacities for
the Company, such persons shall use their respective titles in the Company.
16. TERM; TERMINATION OF AGREEMENT. This Agreement shall commence on the
date hereof (the "Effective Date") and, subject to the automatic extension and
early termination provisions of this Agreement, shall continue until December
31, 2000, and continue thereafter unless terminated by either party as set forth
below. Beginning on January 1, 1998 and continuing as of each January 1
thereafter, the Term of this Agreement shall automatically be extended for one
additional year unless either party exercises the early termination rights
described in the following sentence. By written notice delivered to the other
party not later than November 15 of any calendar year, either party may elect to
avoid the automatic extension of the term. For example, if a party gives notice
on or before November 15, 1998 of its election to avoid the automatic extension
provision of this Agreement, the term of this Agreement would end on December
31, 2001.
During the ninety (90) day period following a Change in Control, the
Company shall have the right to elect to terminate this Agreement, by notice
given to the Advisor. Such termination shall be effective one hundred eighty
(180) days following the Advisor's receipt of notice of termination from the
Company.
If any director of the Company is an Affiliate of the Advisor, the
approval of a majority of the Board of Directors of the Company who are not so
affiliated shall be required for the Company to make the election described in
the preceding paragraph. If this Agreement is terminated pursuant to this
Section 16, such termination shall be without further liability or obligation of
either party to the other as of the Termination Date, except as provided in
Section 20 hereof; provided however, that in no event shall such termination
limit the Advisor's right to indemnification pursuant to Section 21 hereof with
respect to any acts or omission undertaken by Advisor prior to such termination.
17. AMENDMENTS. This Agreement shall not be changed, modified, terminated
or discharged in whole or in part except by an instrument in writing signed by
both parties hereto, or their respective successors or assigns, or otherwise as
provided herein. If any director of the Company is an Affiliate of the Advisor,
the approval of a majority of the Board of Directors of
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the Company who are not so affiliated shall be required for the Company to amend
this Agreement.
18. DEFAULT, BANKRUPTCY, ETC. At the option solely of the Board of
Directors of the Company, this Agreement shall be and become terminated
immediately upon written notice of termination from the Board of Directors of
the Company to the Advisor if any of the following events shall occur:
(a) If the Advisor shall violate any provision of this Agreement,
and after notice of such violation shall not cure such default within thirty
(30) days, or, such longer period as may be appropriate if not susceptible of
being cured within the thirty (30) days; or
(b) If the Advisor shall be adjudged bankrupt or insolvent by a
court of competent jurisdiction, or an order shall be made by a court of
competent jurisdiction for the appointment of a receiver, liquidator, or trustee
of the Advisor or of all or substantially all of its property by reason of the
foregoing, or approving any petition filed against the Advisor for its
reorganization, and such adjudication or order shall remain in force or unstayed
for a period of sixty (60) days; or
(c) If the Advisor shall institute proceedings for voluntary
bankruptcy or shall file a petition seeking reorganization under the Federal
bankruptcy laws, or for relief under any law for the relief of debtors, or shall
consent to the appointment of a receiver of itself or of all or substantially
all its property, or shall make a general assignment for the benefit of its
creditors, or shall admit in writing its inability to pay its debts generally,
as they become due.
The Advisor agrees that if any of the events specified in subsections (b)
and (c) of this Section 18 shall occur, it will give written notice thereof to
the Board of Directors of the Company within seven (7) days after the occurrence
of such event. If any director of the Company is an Affiliate of the Advisor,
the approval of a majority of the Board of Directors of the Company who are not
so affiliated shall be required for the Company to give any notice described in
this Section.
19. ASSIGNMENT. The Advisor may assign this Agreement to any Affiliate of
the Advisor, provided that at the time of the assignment the assignee (x)
assumes and agrees to be bound by this Agreement and (y) is controlled by a
board of directors, a majority of whom are members of the Board of Directors of
the Advisor and (z) has as its chief executive officer the individual who is
Chief Executive Officer or Chairman of the Advisor. Such an assignment or any
other assignment of this Agreement by the Advisor shall bind the assignee
thereunder in the same manner as the Advisor is bound hereunder. The Advisor may
also assign this Agreement to a corporation, association, trust, or other
successor organization which may take over the property and carry on the affairs
of the Advisor, provided that following such assignment the persons who
controlled the operations of the Advisor immediately prior to the assignment
shall control the operation of the successor organization, including the
performance of its duties under this Agreement, and they shall be bound by the
same restrictions by which they were bound to
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such assignment. This Agreement shall not otherwise be assignable by the Advisor
without the prior written consent of the Company. This Agreement shall not be
assignable by the Company without the prior written consent of the Advisor,
except in the case of any assignment by the Company to a corporation or other
organization which is the successor to the Company, in which case such successor
shall be bound hereby and by the terms of said assignment in the same manner and
to the same extent as the Company is bound hereby.
20. ACTION UPON TERMINATION. From and after the effective date of
termination of this Agreement, pursuant to Sections 16, 18 or 19 hereof, the
Advisor shall not be entitled to compensation for further services hereunder but
shall be paid all compensation accruing to the date of termination. The Advisor
shall be deemed to have earned one-twelfth of the Incentive Fee for each full
calendar month during which it provides services to the Company under this
Agreement. The Advisor shall forthwith upon such termination:
(a) pay over to the Company all monies collected and held for the
account of the Company pursuant to this Agreement;
(b) deliver to the Board of Directors of the Company a full
accounting, including a statement showing all payments collected by it and a
statement of any monies held by it, covering the period following the date of
the last accounting furnished to the Board of Directors of the Company; and
(c) deliver to the Board of Directors of the Company all property
and documents of the Company then in the custody of the Advisor.
For a period of one year following the date of termination of this
Agreement, neither the Company nor any Affiliate of the Company shall, directly
or indirectly, offer employment (including, but not limited to consulting
arrangements) to any employee of the Advisor or any Affiliate of the Advisor
without the prior written consent of the Advisor, which consent may be freely
withheld.
21. LIMITS OF ADVISOR RESPONSIBILITY. The Advisor assumes no
responsibility other than to render the services described herein in good faith
and shall not be responsible for any action of the Company in following or
declining to follow any advice or recommendation of the Advisor. The Advisor,
its shareholders, directors, officers, agents, employees and Affiliates will not
be liable to the Company, its shareholders, or others, except by reason of acts
constituting bad faith, willful or wanton misconduct or gross negligence. The
Company shall reimburse, indemnify and hold harmless the Advisor, its
shareholders, directors, officers, agents and employees and its Affiliates for
and from any and all expenses, losses, damages, liabilities, demands, charges
and claims of any nature whatsoever in respect to or arising from any acts or
omissions of the Advisor undertaken in good faith and in accordance with the
standard set forth above pursuant to the authority granted to it by this
Agreement.
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22. NOTICES. Any notice, report, or other communication required or
permitted to be given hereunder shall be in writing unless some other method of
giving such notice, report, or other communication is accepted by the party to
whom it is given, and shall be effective when transmitted by telecopier,
delivered or, in the case of a mailed notice or notice sent by overnight
courier, upon receipt thereof as conclusively evidenced by the signed receipt
therefor by being delivered at the following addresses of the parties hereto:
The Board of Directors of the Company and/or the Company:
Principal Healthcare Finance Limited
c/o Omega Healthcare Investors, Inc.
000 X. Xxxxxxxxxx Xxxxxx, Xxxxx 000
Xxx Xxxxx, XX 00000
Attention: Managing Director
Telephone: (000) 000-0000
Fax: (000) 000-0000
with a copy to:
Principal Healthcare Finance Limited
X.X. Xxx 000
Pirouet House
Union Street
St. Helier, Jersey JE4 9WG
Channel Islands
Telephone: 000 00 000 000-0000
Fax: 000 00 000 000-000
with an additional copy to:
Xxxxxxxxx Xxxxx & Partners
Xxxxxxx Xxxxx
Xxxxxxx
Xxxxxx XX0X 0XX
Xxxxxxx
Telephone: (0000) 000-0000
Fax: (0000) 000-0000
(0000) 000-0000
The Advisor:
Omega Healthcare Investors, Inc.
000 X. Xxxxxxxxxx Xxxxxx, Xxxxx 000
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Xxx Xxxxx, XX 00000
Attention: Xxxxx X. Xxxxxx, Xx.
President
Telephone: (000) 000-0000
Fax: (000) 000-0000
with a copy to:
Argue Xxxxxxx Xxxxxxxx & Xxxxx, LLP
000 Xxxxx Xxxxxx Xxxxxx
Xxxxx 000
Xxx Xxxxxxx, Xxxxxxxxxx 00000-0000
Attention: Xxxxxxx X. Xxxxx
Telephone: (000) 000-0000
Fax: (000) 000-0000
Either party may at any time give notice in writing to the other party of a
change of its address for the purpose of this Section 22.
23. HEADINGS. The section headings hereof have been inserted for
convenience of reference only and shall not be construed to affect the meaning,
construction, or effect of this Agreement.
24. GOVERNING LAW; CONSENT TO JURISDICTION. This agreement shall be
governed and controlled as to validity, enforcement, interpretation,
construction, effect and in all other respects by the statutes, laws and
decisions of the state of Michigan. The Company consents to in personam
jurisdiction before the state and federal courts in the state of Michigan and
agrees that all disputes concerning this agreement may be litigated, in
Advisor's sole discretion and at Advisor's sole election, only in courts located
in the state of Michigan. The Company agrees that service of process may be
effected upon it under any method permissible under the laws of the state of
Michigan and irrevocably waives any objection to venue in the state or federal
courts of the state of Michigan.
25. JOINDER. The Company shall cause each Affiliate and Securitization
Entity to join in this Agreement for purposes of determining the Invested Assets
Fees and Incentive Fees payable to the Advisor under this Agreement.
26. ENTIRE AGREEMENT. This Agreement constitutes the entire agreement of
the parties hereto with respect to the subject matter hereof and supersedes and
cancels any pre-existing agreements with respect to such subject matter.
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IN WITNESS WHEREOF, PRINCIPAL HEALTHCARE FINANCE LIMITED and OMEGA
HEALTHCARE INVESTORS, INC. by their duly authorized representatives, have signed
these presents all as of November __, 1997.
PRINCIPAL HEALTHCARE FINANCE LIMITED
By: /s/ X. X. Xxxx
Name: X. X. Xxxx
Title: Chairman
OMEGA HEALTHCARE INVESTORS, INC.
By: /s/ Xxxxx X. Xxxxxxxx
Name: Xxxxx X. Xxxxxxxx
Title: Vice President--International
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