1
EXHIBIT 10.4
CONTRIBUTION AGREEMENT
This CONTRIBUTION AGREEMENT (this "Agreement") is made as of
April __, 1998, by and between Omega Healthcare Investors, Inc., a Maryland
corporation ("Omega"), and Omega Worldwide, Inc., a Maryland corporation (the
"Company").
WHEREAS, the Company is a newly formed corporation and a wholly-owned
subsidiary of Omega.
WHEREAS, Omega desires to contribute to the Company all of Omega's
right, title and interest in and to certain of the assets of the business of
Omega in exchange for certain shares of common stock, $0.10 par value per share
of the Company (the "Common Stock"), and a contingent right to receive shares
of Series B Preferred Stock, $1.00 par value per share, of the Company (the
"Series B Preferred") in a transaction intended to qualify as tax-free under
Section 351 of the Internal Revenue Code of 1986, as amended.
NOW THEREFORE, in consideration of the premises, mutual covenants and
agreements contained in this Agreement and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged,
the parties hereto agree as follows:
1. Contribution of Assets. Subject to the terms hereof, Omega
hereby contributes the following assets to the Company and the Company hereby
accepts such assets (the "Assets"):
(a) 3,337,500 ordinary shares of Principal Healthcare Finance
Limited, a private company incorporated with limited liability in the Isle of
Jersey ("Principal");
(b) Warrants to purchase (i) 10,000,000 ordinary shares of
Principal expiring June 30, 2001 at an exercise price of Pound 1.50
(approximately $2.40) per share and (ii) 554,583 ordinary shares of Principal
expiring December 31, 2000 at an exercise price of Pound 1.00 (approximately
$1.60) per share;
(c) Subordinated debt in the amount of Pound 15,000,000
(approximately $24,000,000) provided by Omega to Principal maturing on
December 31, 2000;
(d) A ten-year British pound currency swap contract for the right
to exchange Pound 20,000,000 (approximately $32,000,000) for $31,740,000 on
October 15, 2007;
(e) An Amended and Restated Advisory Agreement by and between
Principal and Omega dated as of July 21, 1995;
(f) ____ voting ordinary shares of Omega (UK) Limited, a United
Kingdom corporation, representing all the issued and outstanding shares of Omega
(UK) Limited; and
(g) Such other assets of Omega set forth on Schedule I having an
aggregate carrying value of not more than $150,000.
2
2. Payment of Purchase Price. In exchange for the Assets, the
Company shall issue 6,399,000 shares of Common Stock and agrees to
automatically issue for no additional consideration 65,000 shares of the Series
B Preferred to Omega for each $0.0625 above $8.625 per share of the Company's
Common Stock that more than 12,000 shares of the Company's Common Stock are
traded on any single day prior to May 2, 1998; provided, however, that the
Company shall not cumulatively issue more than 5,000,000 shares of the Series
B Preferred to Omega under this Agreement.
3. Representations and Warranties. Each party hereto represents
to the other party that it is a corporation duly incorporated and validly
existing under the laws of its state of incorporation and that it has the
requisite power and authority to enter into this Agreement and to carry out its
obligations hereunder. Omega represents and warrants that it has good and
marketable title to the Assets and owns such Assets free and clear of all
liens, encumbrances, claims, security interests and defects. The Company
represents that the Common Stock and the Series B Preferred have been duly
issued and will be outstanding as fully-paid and non-assessable stock of the
Company. Each party hereto represents to the other that this Agreement has
been duly authorized, executed and delivered by each of the parties hereto and
constitutes the valid and binding agreement, enforceable against such party in
accordance with its terms, except to the extent that enforceability may be
limited by applicable bankruptcy, insolvency, reorganization or other laws
affecting the enforcement of creditors' rights generally or by general
equitable principles.
4. Further Assurances. Each of Omega and the Company shall do
such acts and shall execute such further documents, conveyances, deeds,
assignments, transfers and the like, and will cause the doing of such acts and
will cause the execution of such further documents as are within its power as
the other party may at any time and from time to time reasonably request be
done or executed, in order to give full effect to the provisions of this
Agreement.
5. Successors and Assigns. This Agreement shall be binding upon
and inure to the benefit of the parties hereto and their respective heirs,
successors, assigns and affiliates, but shall not be assignable by any party
hereto without the prior written consent of the other party hereto.
6. Headings. The section headings of this Agreement are for
convenience only and in no way limit or enlarge the scope or meaning of the
language hereof.
7. Governing Law. This Agreement shall, in all respects, be
governed, construed, applied and enforced in accordance with the law of the
State of Michigan excluding the effect of principles of conflicts of laws.
8. Entire Agreement and Amendments. This Agreement embodies the
entire agreement between the parties and supersedes all prior agreements and
understandings relating to this transaction. This Agreement may be amended or
supplemented only by an instrument in writing executed by the party against
whom enforcement is sought.
2
3
9. Execution in Counterparts. This Agreement may be executed in
any number of counterparts, each of which shall be deemed to be an original,
and all of such counterparts together shall constitute one and the same
original Agreement.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be executed and delivered as of the date first above written.
OMEGA HEALTHCARE INVESTORS, INC.
By:____________________________
Name:__________________________
Title:_________________________
OMEGA WORLDWIDE, INC.
By:____________________________
Name:__________________________
Title:_________________________
