AGREEMENT REGARDING ACQUISITION
OF FACILITIES
THIS AGREEMENT is made as of the 17th day of July, 1998 by and between
NATIONAL ASSISTED LIVING LIMITED PARTNERSHIP, a Florida limited partnership
whose sole general partner is National Assisted Living, Inc., a Florida
corporation, having its principal office at ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇,
▇▇▇▇▇▇, ▇▇▇▇▇▇▇ (the "Seller") and CAREMATRIX OF MASSACHUSETTS, INC., a Delaware
corporation, having its principal office at ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ (the "Buyer").
W I T N E S S E T H T H A T:
WHEREAS, the Seller (a) is the holder of the tenant's interest under the
Existing Facility Leases (as hereinafter defined), which Existing Facility
Leases relate to certain premises located in seven (7) separate states, upon
which two (2) assisted living facilities have been constructed and are currently
being operated by the Seller and upon which five (5) other assisted living
facilities shall be constructed by the Seller in accordance with the terms
hereof and (b) is the holder of the right to acquire the Blue ▇▇▇▇ Real Property
(as hereinafter defined) and the Richmond Real Property (as hereinafter
defined), the ▇▇▇▇▇▇▇▇▇▇ Real Property (as hereinafter defined) and the West
Bloomfield Hills Real Property (as hereinafter defined) upon which four (4)
assisted living facilities shall be constructed by the Seller in accordance with
the Project Plans (as hereinafter set forth) and the other terms and conditions
set forth herein;
WHEREAS, the Seller intends to finance the acquisition and development of
the Blue ▇▇▇▇ Real Property, the Richmond Real Property, the ▇▇▇▇▇▇▇▇▇▇ Real
Property and the West Bloomfield Hills Real Property pursuant to the Future
Financings (as hereinafter defined) to be consummated after the execution and
delivery of this Agreement in accordance with the terms hereof;
WHEREAS, subject to the provisions hereof and in accordance with the terms
and conditions hereinafter set forth, the Buyer desires to obtain from the
Seller an option to purchase the Seller's interest in (i) the Property (as
hereinafter defined), the Lease Documents (as hereinafter defined) and the
Future Financing Documents (as hereinafter defined) or (ii) at the election of
the Seller, in the wholly-owned Single Purpose Entities (as hereinafter
defined), created by the Seller in accordance with the terms of this Agreement,
to which such Single Purpose Entities the Seller has assigned its interest in
the Property, the Lease Documents and the Future Financing Documents;
WHEREAS, subject to the provisions hereof and in accordance with the terms
and the conditions hereinafter set forth, the Seller desires to obtain from the
Buyer, an option to obligate the Buyer to purchase the Seller's interest in (x)
the Property, the Lease Documents and the Future Financing Documents or (y) at
the election of the Seller, in the wholly-owned Single Purpose Entities, created
by the Seller in accordance with the terms of this Agreement,
to which such Single Purpose Entities the Seller has assigned its interest in
the Property, the Lease Documents and the Future Financing Documents.
NOW, THEREFORE, for and in consideration of the mutual covenants,
conditions, representations and undertakings hereinafter set forth and other
good and valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the parties hereto hereby agree as follows:
1. Definitions. For all purposes of this Agreement, except as
otherwise expressly provided or unless the context otherwise requires, (a) the
terms defined in this Section have the meanings assigned to them in this Section
and include the plural as well as the singular and (b) all references in this
Agreement to designated "Sections" and other subdivisions are to designated
Sections and other subdivisions of this Agreement.
Accountants: As defined in Section 4 of this Agreement.
Accreditation Body: All Persons having or claiming jurisdiction over the
accreditation, certification, evaluation or operation of any Facility or any
Development Project.
Additional Option Payment: As defined in Section 3 of this Agreement.
Adjustment Period: As defined in Section 4 of this Agreement.
Affiliate: With respect to any Person (a) any other Person which, directly
or indirectly, controls or is controlled by or is under common control with such
Person, (b) any other Person that owns, beneficially, directly or indirectly,
five percent (5%) or more of the outstanding capital stock, shares or equity
interests of such Person or (c) any officer, director, employee, general partner
or trustee of such Person or any other Person controlling, controlled by or
under common control with such Person (excluding trustees and Persons serving in
a fiduciary or similar capacity who are not otherwise an Affiliate of such
Person). For the purposes of this definition, the term "control" (including the
correlative meanings of the terms "controlled by" and "under common control
with"), as used with respect to any Person, shall mean the possession, directly
or indirectly, of the power to direct or cause the direction of the management
and policies of such Person, through the ownership of voting securities,
partnership interests, membership interests or other equity interests.
Alternative Ownership Structure: Any form of entity that is a so-called
"pass through" entity and is not separately taxed for federal, state and local
income taxes.
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Anniversary Date: With respect to each Facility other than the Naples
Facility, the date that is the second anniversary of the date that is the later
to occur of (a) the date of the issuance of the CO for such Facility or (b) the
date of the issuance of the Operating Permit for such Facility. With respect to
the Naples Facility, the date that is fifteen (15) months after the execution
date of this Agreement.
Applicable Environmental Laws: Collectively, all Legal Requirements
applicable to (a) environmental conditions on, under or emanating from all or
any portion of the Property including, without limitation, the Comprehensive
Environmental Response, Compensation and Liability Act, the Resource
Conservation and Recovery Act, the Federal Water Pollution Control Act and the
Federal Clean Air Act and (b) the generation, storage, transportation,
utilization, disposal, management or release of Hazardous Substances by any of
the Single Purpose Entities or by the Seller.
Approved Buyer Contingency: With respect to each Development Project, the
amount set forth on EXHIBIT I-2.
Approved Lender Contingency: With respect to each Development Project, the
amount of the contingency line item in any Budget approved by the applicable
Landlord or Future Lender, as set forth on Exhibit I-2 attached hereto.
Approved Property: Collectively, all of the Property other than the Blue
▇▇▇▇ Property, the Richmond Property, the ▇▇▇▇▇▇▇▇▇▇ Property and the West
Bloomfield Hills Property.
Architect: Any Person identified as an Architect under any of the
Architects' Agreements.
Architects' Agreements: Collectively, the Omnibus Letter Agreement, the
Blue ▇▇▇▇ Architect's Agreement, the Richmond Architect's Agreement, the West
Bloomfield Hills Architect's Agreement and the ▇▇▇▇▇▇▇▇▇▇ Architect's Agreement.
Assignment and Assumption Agreement: As defined in Section 9.2 of this
Agreement.
Assignment and Assumption Agreement Regarding Lease Documents: As defined
in Section 9.2 of this Agreement.
Assignment and Assumption Agreement Regarding Loan Documents: As defined in
Section 9.4 of this Agreement.
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Assumed Operating Agreements: With respect to each Facility (and the
applicable portion of the Property related thereto), as defined in Section 8.17
of this Agreement.
Audit: As defined in Section 4 of this Agreement.
Beneficiaries: ▇▇▇▇▇▇ ▇▇▇▇▇▇ and ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, III (who are the
children of ▇▇▇▇▇▇).
▇▇▇▇ of Sale: As defined in Section 9.2 of this Agreement.
Birmingham Acquisition Agreement: Contract of Acquisition, dated as of
September 25, 1997, by and between Seller, as Seller, and HCPI, as Buyer.
Birmingham Budget: The budget relating to the Birmingham Property attached
hereto as EXHIBIT B-1.
Birmingham Closing: The Closing relating to the Birmingham Facility and the
applicable portion of the Property related thereto.
Birmingham Closing Date: The Closing Date relating to the Birmingham
Closing.
Birmingham Conditional Use Approval: The conditional use approval granted
by the ▇▇▇▇▇▇ City Council, as evidenced by the ▇▇▇▇▇▇ City Council Minutes.
Birmingham Construction Contract: That certain Construction Agreement,
dated as of January 26, 1998, by and between the Seller and ▇▇▇▇▇▇ Construction
Co., Inc.
Birmingham Declaration: That certain Declaration of Covenants, Conditions
and Restrictions For Meadow Brook Corporate Park dated as of October 17, 1984,
recorded in Real 5, Page 772.
Birmingham Development Agreement: That certain Development Agreement, dated
as of September 25, 1997, by and between Seller, as Developer, and HCPI, as
Owner.
Birmingham Development Project: The Development Project relating to the
Birmingham Property.
Birmingham Facility: The one-story assisted living facility to be
constructed on the Birmingham Real Property.
Birmingham Intellectual Property: The Intellectual Property relating to the
Birmingham Property.
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▇▇▇▇▇▇▇▇▇▇ Lease: That certain Lease, dated as of September 25, 1997, by
and between HCPI, as Lessor, and Seller, as Lessee.
Birmingham Lease Documents: Collectively, the Existing Lease Documents
relating to the Birmingham Property described on EXHIBIT D attached hereto and
any Lease Documents relating to the Birmingham Property entered into after the
date hereof in accordance with the terms hereof.
Birmingham Letter of Credit: That certain Letter of Credit Number P100374,
in the original principal amount of THREE HUNDRED EIGHTY-SEVEN THOUSAND DOLLARS
($387,000) issued on September 15, 1997 by SunTrust Bank for the benefit of HCPI
as security for the Seller's obligations under the Birmingham Lease Documents,
as amended by Amendment No. 001, dated September 16, 1997, Amendment No. 002,
dated September 25, 1997, and Amendment No. 003, dated April 14, 1998.
Birmingham Permitted Encumbrances: Collectively, the matters relating to
the Birmingham Property described on EXHIBIT E attached hereto, and any
Permitted Encumbrances relating to the Birmingham Real Property hereafter
created in accordance with the terms hereof.
Birmingham Plans and Specifications: Collectively, the plans and
specifications relating to the Birmington Real Property described on EXHIBIT C-1
attached hereto.
Birmingham Property: Collectively, the Birmingham Real Property, the
Birmingham Tangible Personal Property and the Birmingham Intellectual Property.
Birmingham Real Property: The real property described on EXHIBIT A-1
attached hereto and all improvements now or hereafter located thereon
(including, without limitation, the Birmingham Facility).
Birmingham Tangible Personal Property: The Tangible Personal Property
relating to the Birmingham Real Property.
Birmingham Title Insurance Policy: That certain Leasehold Owner's Title
Insurance Policy No. ▇▇-▇▇-▇▇▇▇▇▇, dated October 29, 1997, issued to the Seller
in the amount of $6,697,706 by Lawyers Title Insurance Corporation.
Blue ▇▇▇▇ Architect's Agreement: The agreement for Architectural and Design
Services hereafter entered into between the Seller (or any Single Purpose
Entity) and an architect licensed to do business in Pennsylvania (reasonably
acceptable to the Buyer and any
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applicable Future Lender) relating to the Blue ▇▇▇▇ Plans and Specifications,
which is approved by the Buyer and the applicable Future Lender.
Blue ▇▇▇▇ Budget: The budget relating to the Blue ▇▇▇▇ Property attached
hereto as EXHIBIT B-2.
Blue ▇▇▇▇ Closing: The Closing relating to the Blue ▇▇▇▇ Facility and the
applicable portion of the Property related thereto.
Blue ▇▇▇▇ Closing Date: The Closing Date relating to the Blue ▇▇▇▇ Closing.
Blue ▇▇▇▇ Construction Contract: An Agreement hereafter entered into
between the Seller (or any Single Purpose Entity) and a general contractor
licensed to do business in Pennsylvania (reasonably acceptable to the Buyer and
any applicable Future Lender) relating to construction of the Blue ▇▇▇▇ Facility
in accordance with the Blue ▇▇▇▇ Plans and Specifications, which is approved by
the Buyer and the applicable Future Lender.
Blue ▇▇▇▇ Development Agreement: Any development agreement hereafter
entered into, in accordance with the terms hereof, by and between the Seller (or
any Single Purpose Entity) and any Future Lender in connection with any Future
Financing hereafter consummated in accordance with the terms hereof, pursuant to
which, such Future Lender shall agree to provide to the Seller (or any Single
Purpose Entity) the funds necessary to develop and construct the Blue ▇▇▇▇
Facility in accordance with the Blue ▇▇▇▇ Plans and Specifications and the terms
of this Agreement.
Blue ▇▇▇▇ Facility: The two-story assisted living facility with eighty-four
(84) units to be constructed on the Blue ▇▇▇▇ Real Property.
Blue ▇▇▇▇ Intellectual Property: The Intellectual Property relating to the
Blue ▇▇▇▇ Facility.
Blue ▇▇▇▇ Letter of Credit: Collectively, any and all letters of credit
obtained by the Seller (or any Single Purpose Entity) and issued to any Landlord
or other Future Lender as collateral for the obligations of the Seller or such
Single Purpose Entity under the terms of the Future Financing Documents relating
to the Blue ▇▇▇▇ Property.
Blue ▇▇▇▇ Permitted Encumbrances: Collectively, such matters as are taken
as exceptions in the Seller's Title Insurance Policy to be issued pursuant to
the Blue ▇▇▇▇ Title Insurance Commitment; provided, that, the same have been
reviewed and approved by the Buyer.
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Blue ▇▇▇▇ Plans and Specifications: The final plans and specifications for
the construction and equipping of the Blue ▇▇▇▇ Facility, including, without
limitation, all schematic and working drawings, prepared by the applicable
Architect under the Blue ▇▇▇▇ Architect's Agreement and approved by all
appropriate Governmental Authorities, the Buyer and the applicable Future
Lender.
Blue ▇▇▇▇ Property: Collectively, the Blue ▇▇▇▇ Real Property, the Blue
▇▇▇▇ Tangible Personal Property and the Blue ▇▇▇▇ Intellectual Property.
Blue ▇▇▇▇ Purchase Agreement: That certain Purchase Agreement, dated July
23, 1997, by and between the Seller, as Buyer and Alcar Restaurants, Inc., as
Seller.
Blue ▇▇▇▇ Purchase Documents: Collectively, all documents, instruments and
other materials that are necessary to consummate the acquisition of the Blue
▇▇▇▇ Real Property pursuant to the terms of the Blue ▇▇▇▇ Purchase Agreement.
Blue ▇▇▇▇ Real Property: The real property that is the subject of the Blue
▇▇▇▇ Purchase Agreement and is described on EXHIBIT A-2 attached hereto,
together with all improvements now or hereafter located thereon (including,
without limitation, the Blue ▇▇▇▇ Facility).
Blue ▇▇▇▇ Subdivision Approvals: As defined in Section 8.27 of this
Agreement.
Blue ▇▇▇▇ Survey: A current survey of the Blue ▇▇▇▇ Real Property,
satisfactory in form and content to the Buyer, that is prepared and signed by a
surveyor licensed to do business in Pennsylvania.
Blue ▇▇▇▇ Tangible Personal Property: The Tangible Personal Property
relating to the Blue ▇▇▇▇ Real Property.
Blue ▇▇▇▇ Title Insurance Commitment: Lawyers Title Insurance Corporation
Title Insurance Commitment, Case No. LTI-97-M-14812 (Revision I), dated May 18,
1998 issued to the Seller.
Blue ▇▇▇▇ Zoning Approval: The Notice of Decision relating to the variances
and special exceptions relating to the Blue ▇▇▇▇ Property by the Whitpain
Township Zoning Hearing Board, regarding a hearing held on November 20, 1997.
Breakeven: Any month wherein the Gross Revenues generated from operations
at a Facility equal or exceed the expenses incurred at such Facility during such
period; provided, that, all expenses are accounted for on an accrual basis.
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Budgets: Collectively, the Naples Budget, the Carmel Budget, the Dublin
Budget, the Germantown Budget, the Birmingham Budget, the Overland Park Budget,
the Hockessin Budget, the Blue ▇▇▇▇ Budget, the Richmond Budget, the ▇▇▇▇▇▇▇▇▇▇
Budget and the West Bloomfield Hills Budget.
Business Day: Any day which is not a Saturday or a Sunday or a public
holiday under the laws of the United States of America, the Commonwealth of
Massachusetts or the state in which the Buyer's depository bank is located.
Buyer: As defined in the preamble of this Agreement and its successors and
assigns.
Buyer's Counsel: As defined in Section 5 of this Agreement.
Buyer Default: As defined in Section 18 of this Agreement.
Buyer Documents: Collectively, all documents required to be delivered by
the Buyer at any Closing in order to effectuate the consummation thereof.
Buyer's Title Insurance Policies: Collectively, the title insurance
policies issued by one or more nationally recognized title insurance companies
reasonably acceptable to the Buyer (or, if applicable, to any Single Purpose
Entity that has been acquired by the Buyer) at the Closings, insuring the
Buyer's (or such Single Purpose Entity's) interest in the Property (a) in
substantially the same form as the Seller's Title Insurance Policies (including,
without limitation, the same affirmative insurance coverages and endorsements),
(b) without any additional Lien, other than any Permitted Encumbrances that may
hereafter be created in accordance with the terms hereof, taken as an exception,
(c) with affirmative insurance that no real estate taxes, water and sewer use
charges, other governmental charges or other assessments are due and payable,
(d) without any exceptions taken regarding any instruments pertaining to any of
the Construction Contracts, (e) with such other additional insurance coverages
and/or endorsements as the Buyer may reasonably request and (f) with such other
differences as are required in accordance with the terms of this Agreement.
Buyer's Transfer Approvals: As defined in Section 8.19 of this Agreement.
Call Notice: As defined in Section 2 of this Agreement.
Call Right: As defined in Section 2 of this Agreement.
CareMatrix: CareMatrix Corporation, a Delaware corporation and its
successors and assigns.
CareMatrix Amendments: As defined in Section 8.13 of this Agreement.
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CareMatrix Approval: The approval by the Board of Directors of CareMatrix
of the execution and delivery of this Agreement by the Buyer and the performance
of the Buyer's obligations hereunder.
Carmel Board of Zoning Minutes: The minutes of the meeting of the Carmel
Board of Zoning Appeals held on October 28, 1996.
Carmel Closing: The Closing relating to the Carmel Facility and the
applicable portion of the Property related thereto.
Carmel Closing Date: The Closing Date relating to the Carmel Closing.
Carmel Construction Contract: That certain Construction Agreement, dated as
of April 2, 1997, by and between the Seller and ▇▇▇▇▇▇ Construction Company.
Carmel Declaration: That certain Meridian Technology Center Declaration of
Covenants and Easements dated December 30, 1986, recorded with the ▇▇▇▇▇▇▇▇
County, Indiana Recorder in Book 190, Page 405, as amended of record.
Carmel Development Agreement: That certain Development Agreement, dated as
of January 21, 1997, by and between NHP and the Seller, as amended by First
Amendment to Lease and Security Agreement and Related Documents (Carmel,
Indiana), dated as of January 21, 1998, by and between NHP, the Seller and the
Guarantor.
Carmel Draft Report: The draft Environmental Report relating to the Carmel
Real Property identified on EXHIBIT H attached hereto.
Carmel Facility: The one-story assisted living facility with fifty-four
(54) units commonly known as Windsor Court located on the Carmel Real Property
with an address of ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇.
Carmel Intellectual Property: The Intellectual Property relating to the
Carmel Facility.
Carmel Lease: That certain Lease and Security Agreement, dated as of
January 21, 1997, by and between NHP, as Landlord and the Seller, as Tenant, as
amended by First Amendment to Lease and Security Agreement and Related Documents
(Carmel, Indiana), dated as of January 21, 1998, by and between NHP, the Seller
and the Guarantor.
Carmel Lease Documents: Collectively, the Existing Lease Documents relating
to the Carmel Property described on EXHIBIT D attached hereto and any Lease
Documents relating to the Carmel Property entered into after the date hereof in
accordance with the terms hereof.
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Carmel Letter of Credit: That certain Letter of Credit (No. F700723), dated
April 14, 1998, in the original principal amount of TWO HUNDRED TEN THOUSAND
DOLLARS ($210,000.00) issued by SunTrust Bank for the benefit of NHP, as
security for the Seller's obligations under the Carmel Lease Documents.
Carmel Permitted Encumbrances: Collectively, the matters relating to the
Carmel Property described on EXHIBIT E attached hereto and any Permitted
Encumbrances relating to the Carmel Property hereafter created in accordance
with the terms hereof.
Carmel Plans and Specifications: Collectively, the plans and specifications
relating to the Carmel Real Property described on EXHIBIT C-3 attached hereto.
Carmel Property: Collectively, the Carmel Real Property, the Carmel
Tangible Personal Property and the Carmel Intellectual Property.
Carmel Real Property: The real property described on EXHIBIT A-3 attached
hereto and all improvements now or hereafter located thereon (including, without
limitation, the Carmel Facility).
Carmel Survey: That certain survey entitled "Land Title Survey Meridian
Technology Center," prepared by ▇▇▇▇▇▇▇▇▇ Engineering Corporation, dated July
10, 1992, last revised January 21, 1997.
Carmel Tangible Personal Property: The Tangible Personal Property relating
to the Carmel Real Property.
Carmel Title Insurance Policy: That certain Leasehold Owner's Title
Insurance Policy No. 215-009996, dated January 30, 1997, issued to the Seller in
the amount of $4,200,000.00 by Commonwealth Land Title Insurance Company, as
amended by Endorsement dated April 15, 1998, increasing the amount of coverage
to $4,401,053.
Carmel Use Variance: That certain Use Variance granted by the Carmel Board
of Zoning Appeals allowing the operation of a 35,000 square foot assisted living
facility containing 54 units on the Carmel Real Property.
Casualty: As defined in Section 8.22 of this Agreement.
Change in Law: As defined in Section 8.33 of this Agreement.
Closing: As defined in Section 2 of this Agreement.
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Closing Certification: As defined in Section 6 of this Agreement.
Closing Conditions: As defined in Section 2 of this Agreement.
Closing Date: Any date upon which a Closing is consummated in accordance
with the terms of this Agreement.
Closing Month: As defined in Section 14 of this Agreement.
CO: A final, unconditional Certificate of Occupancy (or its equivalent)
permitting the initial occupancy of any Facility or Development Project for its
Primary Intended Use after the completion of the construction thereof in
accordance with the terms of this Agreement and the applicable Development
Agreement and Project Plans related thereto.
Condemnation: A taking by power of eminent domain or conveyance in lieu
thereof of all or any portion of the Property.
Condemnation Notice: As defined in Section 8.23 of this Agreement.
Construction Contracts: Collectively, the Naples Construction Contract, the
Carmel Construction Contract, the Dublin Construction Contract, the Germantown
Construction Contract, the Birmingham Construction Contract, the Overland Park
Construction Contract, the Hockessin Construction Contract, the Blue ▇▇▇▇
Construction Contract, the Richmond Construction Contract, the ▇▇▇▇▇▇▇▇▇▇
Construction Contract and the West Bloomfield Hills Construction Contract.
Construction Permits and Contracts: As defined in Section 6.29 of this
Agreement, including, without limitation, the Permits and Contracts described on
EXHIBIT F attached hereto.
Contingency Adjustment: For any Facility, the amount described on EXHIBIT
I-3, which equals the Approved Buyer Contingency for such Facility minus the
Approved Lender Contingency for such Facility.
Contracts: Collectively, all agreements, contracts (including, without
limitation, construction contracts, subcontracts and architects' contracts),
contract rights, warranties and representations, franchises, and records and
books of account benefiting, relating to or affecting the Property and the
ownership, construction, development, maintenance, management, repair, use,
occupancy, possession or operation thereof or the operation of any programs or
services in conjunction with the Property and all renewals, replacements and
substitutions therefor, now or hereafter issued by or entered into with any
Governmental Authority or maintained or used by any member of the Selling Group
or entered into by any member of the Selling Group.
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Design Defect for Which the Seller has Responsibility: As defined in
Section 13 of this Agreement.
Development Agreements: Collectively, the Naples Development Agreement, the
Carmel Development Agreement, the Dublin Development Agreement, the Germantown
Development Agreement, the Birmingham Development Agreement, the Overland Park
Development Agreement, the Hockessin Development Agreement, the Blue ▇▇▇▇
Development Agreement, the Richmond Development Agreement, the West Bloomfield
Hills Development Agreement and the ▇▇▇▇▇▇▇▇▇▇ Development Agreement.
Development Fee: With respect to each Facility identified on EXHIBIT G
attached hereto, the Development Fee shall equal the amount set forth on EXHIBIT
G relating thereto, which amount represents that portion, if any, of the
applicable Maximum Amount that may be advanced under the applicable Development
Agreement for payment to the Seller (or any Affiliate thereof) as a development
fee.
Development Projects: Collectively, all of the Facilities which are
currently under construction or with respect to which construction has not
commenced. The Development Projects include all of the Facilities other than the
Naples Facility and the Carmel Facility.
Dublin Budget: The budget relating to the Dublin Property attached hereto
as EXHIBIT B-4.
Dublin Closing: The Closing relating to the Dublin Facility and the
applicable portion of the Property related thereto.
Dublin Closing Date: The Closing Date relating to the Dublin Closing.
Dublin Construction Contract: That certain Agreement, dated as of August
21, 1997, by and between the Seller, as Owner, and Ruscilli Construction Co.,
Inc., as Contractor.
Dublin Development Agreement: That certain Development Agreement, dated as
of April 29, 1997, by and between NHP and the Seller, as amended by First
Amendment to Lease and Security Agreement and Related Documents (Dublin, Ohio),
dated as of January 21, 1998, by and among NHP, the Seller and the Guarantor.
Dublin Driveway Easement Agreements: Collectively, (a) the Grant of
Reciprocal Easements for Driveway Purposes and Agreement to Jointly Maintain
Demised Easement Areas by and between NHP and Brand Road Investment Co., Ltd.
recorded on May 2, 1997 with the Franklin County, Ohio Recorder in Official
Record 35000E16 and (b) the Grant of
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Reciprocal Easements for Driveway Purposes and Agreement to Jointly Maintain
Demised Easement Areas by and between NHP and Brand Road Investment Co., Ltd.,
recorded on May 18, 1998 with the Franklin County, Ohio Recorder as Instrument
No. 1988, 05180119987.
Dublin Facility: The two-story assisted living facility with eighty-three
(83) units to be constructed on the Dublin Real Property.
Dublin Intellectual Property: The Intellectual Property relating to the
Dublin Facility.
Dublin Lease: That certain Lease and Security Agreement, dated as of
April 29, 1997, by and between NHP, as Landlord and the Seller, as Tenant, as
amended by First Amendment to Lease and Security Agreement and Related Documents
(Dublin, Ohio), dated as of January 21, 1998, by and among NHP, the Seller and
the Guarantor.
Dublin Lease Documents: Collectively, all of the Existing Lease Documents
relating to the Dublin Property described on EXHIBIT D attached hereto and any
Lease Documents relating to the Dublin Property entered into after the date
hereof in accordance with the terms hereof.
Dublin Letter of Credit: That certain Letter of Credit (No. F700722), dated
April 14, 1998, in the original principal amount of TWO HUNDRED SEVENTY-FOUR
THOUSAND DOLLARS ($274,000.00) issued by SunTrust Bank for the benefit of NHP,
as security for the Seller's obligations under the Dublin Lease Documents.
Dublin Permitted Encumbrances: Collectively, the matters relating to the
Dublin Property described on EXHIBIT E attached hereto and any Permitted
Encumbrances relating to the Dublin Property hereafter created in accordance
with the terms hereof.
Dublin Plans and Specifications: Collectively, the plans and specifications
relating to the Dublin Real Property described on EXHIBIT C-4 attached hereto.
Dublin Property: Collectively, the Dublin Real Property, the Dublin
Tangible Personal Property and the Dublin Intellectual Property, which includes,
without limitation, the property demised under the Dublin Lease.
Dublin Real Property: The real property described on EXHIBIT A-4 attached
hereto and all improvements now or hereafter located thereon (including, without
limitation, the Dublin Facility).
Dublin Tangible Personal Property: The Tangible Personal Property relating
to the Dublin Real Property.
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Dublin Title Insurance Policy: That certain Leasehold Owner's Title
Insurance Policy No. ▇▇-▇▇-▇▇▇▇▇▇, dated May 2, 1997, issued to the Seller in
the amount of $5,478,700.00 by Lawyers Title Insurance Corporation, as amended
by Endorsement dated as of June 3, 1998, increasing the amount of coverage to
$5,936,750 and changing the effective date of the policy to May 18, 1998.
Due Diligence Review Date: June 12, 1998.
EBITDA: Earnings before interest, taxes (but after Real Estate Taxes),
depreciation and amortization and after a management fee equal to three percent
(3%) of the Gross Revenues of the applicable Facility, calculated for any month.
Election Notice: Any Put Notice or Call Notice.
Environmental Reports: Collectively, the environmental site assessment
reports identified on EXHIBIT H attached hereto.
Escrow Account: As defined in Section 6.33 of this Agreement.
Environmental Claim: Any civil, criminal or investigative action, suit,
communication (written or oral), demand, claim, citation, notice, consent
decree, contract right (including without limitation, right of indemnification),
investigation, judgment or order by any Person alleging, concerning or finding
liability or potential liability arising out of or resulting from, in whole or
in part, the actual or alleged presence, threatened release, release, emission,
disposal, storage, treatment, transportation, generation, manufacture or use of
any Hazardous Substance at, from or affecting any portion of the Property.
Excluded Facilities: Collectively, the assisted living facility to be
developed by the Seller in Willistown, Pennsylvania, the assisted living
facility to be developed by the Seller in Mt. Laurel, New Jersey and the
independent living facility to be developed by the Seller within a fifteen (15)
mile radius of the Germantown Facility.
Exercise Period: With respect to each Facility, the period from the
applicable Facility's Anniversary Date through such Facility's Expiration Date.
Existing Construction Contracts: All of the Construction Contracts other
than the Blue ▇▇▇▇ Construction Contract, the Richmond Construction Contract,
the Montgomery Construction Contract and the West Bloomfield Hills Construction
Contract.
Existing Facilities: Collectively, the Naples Facility and the Carmel
Facility.
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Existing Facility Leases: Collectively, all of the Facility Leases
identified on EXHIBIT D attached hereto.
Existing Lease Documents: Collectively, all of the Lease Documents
identified on EXHIBIT D attached hereto.
Existing Letters of Credit: Collectively, the Naples Letter of Credit, the
Carmel Letter of Credit, the Dublin Letter of Credit, the Germantown Letter of
Credit, the Birmingham Letter of Credit, the Overland Park Letter of Credit and
the Hockessin Letter of Credit.
Existing Permits and Contracts: As defined in Section 6.29 of this
Agreement.
Existing Project Plans: Collectively, all of the Project Plans other than
the Blue ▇▇▇▇ Plans and Specifications, the Richmond Plans and Specifications,
the ▇▇▇▇▇▇▇▇▇▇ Plans and Specifications and the West Bloomfield Hills Plans and
Specifications.
Expiration Date: With respect to each Facility other than Naples Facility,
the date that is six (6) months after the applicable Facility's Anniversary
Date. With respect to the Naples Facility, the date that is fifteen (15) months
after the Naples Facility's Anniversary Date.
Extension Letters: Collectively those certain letters dated June 4, 1998,
June 17, 1998 and June 25, 1998 from the Buyer to, and accepted by, the Seller,
relating to the Letter of Intent.
Facilities: Collectively, the Naples Facility, the Carmel Facility, the
Dublin Facility, the Germantown Facility, the Birmingham Facility, the Overland
Park Facility, the Hockessin Facility, the Blue ▇▇▇▇ Facility, the Richmond
Facility, the Montgomery Facility and the West Bloomfield Hills Facility.
Facility Leases: Collectively, the Naples Lease, the Carmel Lease, the
Dublin Lease, the Germantown Lease, the Birmingham Lease, the Overland Park
Lease, the Hockessin Lease, and any other Lease relating to any Facility
hereafter entered into with any Future Lender in connection with any Future
Financing.
Facility Purchase Price: With respect to the Seller's interest in any
Facility (other than the Naples Facility) and the applicable portion of the
Property relating thereto, an amount equal to the product of (a) 8.25 multiplied
by (b) the EBITDA for such Facility annualized for the six (6) month period
ending on the last day of the calendar month immediately prior to the date of
the exercise of the Buyer's Call Right or the Seller's Put Right, as the case
may be. With respect to the Seller's interest in the Naples Facility and the
applicable portion of the
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Property relating thereto, an amount equal to the product of (i) 9 multiplied by
(ii) the EBITDA for such Facility annualized for the six (6) month period ending
on the last day of the calendar month immediately prior to the date of the
exercise of the Buyer's Call Right or the Seller's Put Right, as the case may
be.
Future Financing: Any sale/leaseback or mortgage financing transaction
hereinafter entered into by the Seller (or any Single Purpose Entity) in
accordance with the terms hereof to finance the construction, development and
operation of the Blue ▇▇▇▇ Property, the Richmond Property, the Montgomery
Property and/or the West Bloomfield Hills Property.
Future Financing Default: A default or breach of condition continuing
beyond the expiration of any applicable notice and/or grace periods under any of
the Future Financing Documents.
Future Financing Documents: Collectively, all documents and instruments
hereafter entered into to evidence and/or secure any Future Financing
consummated in accordance with the terms of this Agreement.
Future Lender: Any commercial lender that provides sale/leaseback or
mortgage financing to the Seller or any Single Purpose Entity relating to the
construction, development and operation of the Blue ▇▇▇▇ Property, the Richmond
Property, the Montgomery Property and/or the West Bloomfield Hills Property.
Future Permits and Contracts: Collectively, all Construction Permits and
Contracts other than the Existing Permits and Contracts.
General Assignment: As defined in Section 9.2 of this Agreement.
General Contractor: Any Person identified as the General Contractor under
any of the Construction Contracts.
General Partner: National Assisted Living, Inc., a Florida corporation and
its successors and assigns.
Germantown Budget: The budget relating to the Germantown Property attached
hereto as EXHIBIT B-5.
Germantown Closing: The Closing relating to the Germantown Facility and the
applicable portion of the Property related thereto.
Germantown Closing Date: The Closing Date relating to the Germantown
Closing.
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Germantown Construction Contract: That certain Agreement, dated as of
September 10, 1997, by and between the Seller, as Owner and ▇▇▇▇▇▇ Construction
Company, Inc., as Contractor.
Germantown Development Agreement: That certain Development Agreement, dated
as of May 15, 1997, by and between NHP and the Seller, as amended by First
Amendment to Lease and Security Agreement and Related Documents (Germantown,
Tennessee), dated as of January 21, 1998, by and among NHP, the Seller and the
Guarantor.
Germantown Facility: The two-story assisted living facility with fifty (50)
units to be constructed on the Germantown Real Property.
Germantown Intellectual Property: The Intellectual Property relating to the
Germantown Facility.
Germantown Lease: That certain Lease and Security Agreement, dated May 15,
1997, by and between NHP, as Landlord and the Seller, as Tenant, as amended by
First Amendment to Lease and Security Agreement and Related Documents
(Germantown, Tennessee), dated as of January 21, 1998, by and among NHP, the
Seller and the Guarantor.
Germantown Lease Documents: Collectively, all of the Existing Lease
Documents relating to the Germantown Property described on EXHIBIT D attached
hereto and any Lease Documents relating to the Germantown Property entered into
after the date hereof in accordance with the terms hereof.
Germantown Letter of Credit: That certain Letter of Credit (No.
F501655/F700658), dated May 16, 1997, in the original principal amount of TWO
HUNDRED FIFTEEN THOUSAND DOLLARS ($215,000.00) issued by SunTrust Bank for the
benefit of NHP as security for the Seller's obligations under the Germantown
Lease Documents, as amended by Amendment No. 1 dated May 20, 1998.
Germantown Permitted Encumbrances: Collectively, the matters relating to
the Germantown Property described on EXHIBIT E attached hereto and any Permitted
Encumbrances relating to the Germantown Property hereafter created in accordance
with the terms hereof.
Germantown Plans and Specifications: Collectively, the plans and
specifications described on EXHIBIT C-5 attached hereto.
Germantown Property: Collectively, the Germantown Real Property, the
Germantown Tangible Personal Property and the Germantown Intellectual Property.
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Germantown Real Property: The real property described on EXHIBIT A-5
attached hereto and all improvements now or hereafter located thereon
(including, without limitation, the Germantown Facility).
Germantown Tangible Personal Property: The Tangible Personal Property
relating to the Germantown Real Property.
Germantown Title Insurance Policy: That certain Leasehold Owner's Title
Insurance Policy No. ▇▇▇-▇▇-▇▇▇▇▇▇, dated May 29, 1997, issued to the Seller in
the amount of $4,300,000.00 by Lawyers Title Insurance Corporation, as amended
by Endorsement dated as of June 1, 1998, increasing the amount to $5,150,072.75.
Germantown Utility Easement: That certain easement, dated June 19, 1973,
granted by ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ and ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ to Memphis Light, Gas and
Water Division, recorded in the Register's Office of Shelby County, Tennessee as
instrument number J2 8740.
Germantown Board of Zoning Appeals Minutes: The minutes of the meeting of
the Germantown Board of Zoning Appeals held on January 28, 1997.
Germantown Zoning Approvals: Collectively, (a) an Unconditional Special Use
Permit and three (3) Variances pertaining to side and rear yard setback
requirements and maximum building height limitations granted by the Germantown
Board of Zoning Appeals with respect to the Germantown Real Property, as
evidenced by the Germantown Board of Zoning Appeals Minutes, (b) the approvals
relating to the Germantown Real Property evidenced by the minutes of the
meetings of the Germantown Planning Commission held on October 1, 1996 and March
4, 1997 and (c) the approvals relating to the Germantown Real Property evidenced
by the minutes of the meeting of the Germantown Design Review Commission held on
February 18, 1997.
Governmental Authorities: Collectively, all agencies, authorities, bodies,
boards, commissions, courts, instrumentalities, legislatures and offices of any
nature whatsoever for any government unit, quasi-government or political
subdivision, whether federal, state, county, district, municipal, city or
otherwise, and whether now or hereafter in existence.
Gross Revenues: The term "Gross Revenues" shall mean all revenues generated
by reason of the operation of the Property, including, without limitation, all
resident revenues received or receivable for the use of, or otherwise by reason
of all rooms, units and other facilities provided, meals served, services
performed, space or facilities subleased or goods sold on or from the Property,
including, without limitation, except as otherwise specifically provided below,
any consideration received under any subletting, licensing or other arrangements
with any Person relating to the possession or use of any portion of the Property
and all revenues from all ancillary services provided at and/or relating to the
Property; provided, however, that Gross Revenues shall not include non-operating
revenues such as
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interest income or gain from the sale of assets not sold in the ordinary course
of business; and provided, further, that there shall be excluded or deducted (as
the case may be) from such revenues:
a. contractual allowances for ▇▇▇▇▇▇▇▇ not paid by or received from the
appropriate Governmental Authorities or third party payors,
b. allowances according to GAAP for uncollectible accounts,
c. all proper resident billing credits and adjustments according to GAAP
relating to health care accounting,
d. federal, state or local sales, use, gross receipts and excise taxes
and any tax based upon or measured by said Gross Revenues which is
added to or made a part of the amount billed to the patient or other
recipient of such services or goods, whether included in the billing
or stated separately,
e. provider discounts for hospital or other medical facility utilization
contracts,
f. the cost of any special federal, state or local governmental program
imposed specially to provide or finance indigent patient care (other
than Medicare, Medicaid and the like), and
g. deposits refundable to residents of any Facility.
To the extent that any Facility is subleased or occupied by an Affiliate of
the Seller, Gross Revenues calculated for all purposes of this Agreement shall
include the Gross Revenues of such sublessee with respect to the premises
demised under the applicable sublease (i.e., the Gross Revenues generated from
the operations conducted on such subleased portion of the Facility) and the rent
received or receivable from such sublessee pursuant to such subleases shall be
excluded from Gross Revenues for all such purposes. As to any sublease with a
non-Affiliate of the Seller, only the rental actually received by the Seller (or
the applicable Single Purpose Entity) from such non-Affiliate shall be included
in Gross Revenues.
Guarantor: Liberty Assisted Living Centers of Tennessee Limited
Partnership, a Georgia limited partnership.
Hazardous Substances: Collectively, (a) any "hazardous material,"
"hazardous substance," "hazardous waste," "oil," "regulated substance," "toxic
substance," "restricted hazardous waste", "special waste" or words of similar
import as defined under any of the Applicable Environmental Laws; (b) asbestos
in any form; (c) urea formaldehyde foam
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insulation; (d) polychlorinated biphenyls; (e) radon gas; (f) flammable
explosives; (g) radioactive materials; (h) any chemical, contaminant, solvent,
material, pollutant or substance that may be dangerous or detrimental to all or
any portion of the Property, the environment, or the health and safety of the
residents and other occupants of any portion of the Property or of the owners or
occupants of any other real property nearby any portion of the Property and (i)
any substance, the generation, storage, transportation, utilization, disposal,
management, release or location of which, on, under or from any portion of the
Property is prohibited or otherwise regulated pursuant to any of the Applicable
Environmental Laws.
Notwithstanding the foregoing, the term Hazardous Substances as defined
herein shall not include (i) pharmaceuticals and cleaning agents of the types
and in the quantities and concentrations normally stocked by assisted living
providers similar to the Facilities, (ii) oil in de minimis amounts typically
associated with the use of certain portions of the Property for driving and
parking motor vehicles or (iii) medical wastes generated at any Facility;
provided, that the foregoing are used, stored, transported and/or disposed of in
accordance with all Legal Requirements.
HCPI: Health Care Property Investors, Inc., a Maryland corporation.
Hockessin Budget: The budget relating to the Hockessin Property attached
hereto as EXHIBIT B-6.
Hockessin Closing: The Closing relating to the Hockessin Facility and the
applicable portion of the Property related thereto.
Hockessin Closing Date: The Closing Date relating to the Hockessin Closing.
Hockessin Construction Contract: That certain Agreement, dated as of
January 27, 1998 by and between the Seller, as Owner and NC Builders Inc., as
Contractor.
Hockessin Development Agreement: That certain Development Agreement, dated
as of March 19, 1998, by and between MLD and the Seller.
Hockessin Facility: The two-story assisted living facility with fifty-four
(54) units to be constructed on the Hockessin Real Property.
Hockessin Intellectual Property: The Intellectual Property relating to the
Hockessin Facility.
Hockessin Lease: That certain Lease and Security Agreement, dated March 19,
1998, by and between MLD, as Lessor and the Seller, as Lessee.
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Hockessin Lease Documents: Collectively, all of the Existing Lease
Documents relating to the Hockessin Property described on EXHIBIT D attached
hereto and any Lease Documents relating to the Hockessin Property entered into
after the date hereof in accordance with the terms hereof.
Hockessin Letter of Credit: That certain Letter of Credit (No. F700701),
dated February 23, 1998, in the original principal amount of TWO HUNDRED FIFTY
THOUSAND DOLLARS ($250,000.00) issued by SunTrust Bank for the benefit of MLD as
security for the Seller's obligations under the Hockessin Lease Documents, as
amended by Amendment No. 1, dated as of May 20, 1998.
Hockessin Permitted Encumbrances: Collectively, the matters relating to the
Hockessin Property described on EXHIBIT E attached hereto and any matters
relating to the Hockessin Real Property hereafter created in accordance with the
terms hereof.
Hockessin Plans and Specifications: Collectively, the plans and
specifications relating to the Hockessin Real Property described on EXHIBIT C-6
attached hereto.
Hockessin Property: Collectively, the Hockessin Real Property, the
Hockessin Tangible Personal Property and the Hockessin Intellectual Property.
Hockessin Real Property: The real property described on EXHIBIT A-6
attached hereto and all improvements now or hereafter located thereon
(including, without limitation, the Hockessin Facility).
Hockessin Sewer Agreement: That certain Sewer Commitment Agreement, dated
April 9, 1998, by and between the Seller and New Castle County.
Hockessin Tangible Personal Property: The Tangible Personal Property
relating to the Hockessin Real Property.
Hockessin Title Insurance Policy: That certain Owner's Title Insurance
Policy No. 85- 01-510442, dated March 23, 1998, issued to MLD in the amount of
$5,200,000 by Lawyers Title Insurance Corporation.
Hockessin Variance: Collectively, the variances relating to the Hockessin
Real Property granted by the Board of Adjustment of New Castle County pursuant
to Notice of Decision filed July 21, 1997.
▇▇▇▇▇▇ City Council Minutes: The minutes of the meeting of the ▇▇▇▇▇▇ City
Council held on August 18, 1997.
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HSR ACT: The ▇▇▇▇-▇▇▇▇▇-▇▇▇▇▇▇ Antitrust Improvements Act of 1976, as
amended.
Impositions: As defined in Section 8.9 of this Agreement.
Initial Option Payment: As defined in Section 3 of this Agreement.
Insurance Requirements: With respect to any Facility (and the applicable
portion of the Property relating thereto), all terms and requirements set forth
in any insurance policy required to be maintained by the Seller (or, if
applicable, any Single Purpose Entity) pursuant to any applicable Lease
Documents or Future Financing Documents.
Intangible Personal Property: Collectively, all intangible property owned
by the Seller or any Single Purpose Entity and used or useful in connection with
the Real Property and/or the Tangible Personal Property, including without
limitation: (a) all of the Seller's (or any Single Purpose Entity's) right,
title and interest in and to all Leases and all of the Lease Documents; (b) all
of the Seller's (or any Single Purpose Entity's) right, title and interest in
and to the Assumed Operating Agreements; (c) all of the Seller's (or any Single
Purpose Entity's) right, title and interest in the Intellectual Property, (d)
all of the Seller's (or any Single Purpose Entity's) right, title and interest
in all warranties relating to the Property and all Permits and (e) all of the
good will associated with the Facilities.
Intellectual Property: Collectively, all copyrights, rights of
reproduction, trademarks, trade-names, trademark applications, service marks,
patent applications, patents and patent license rights (all whether registered
or unregistered, U.S. or foreign), inventions, franchises, discoveries, ideas,
research, engineering, methods, practices, processes, systems, formulae,
designs, drawings, products, projects, improvements, developments, know-how and
trade secrets which are used in or necessary for the construction and/or
operation of the Property in accordance with its Primary Intended Use.
Landlords: Collectively, HCPI, NHP and any Future Lender providing
sale/leaseback financing in connection with any Future Financing hereafter
consummated in accordance with the provisions of this Agreement.
Last Facilities: As defined in Section 3 of this Agreement.
Lease Assignment and Assumption Documents: As defined in Section 8.13 of
this Agreement.
Lease Default: A default or breach of condition continuing beyond any
applicable notice and/or grace periods under any of the Lease Documents.
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Lease Documents: Collectively, the Naples Lease Documents, the Carmel Lease
Documents, the Dublin Lease Documents, the Germantown Lease Documents, the
Birmingham Lease Documents, the Overland Park Lease Documents, the Hockessin
Lease Documents and any other documents or instruments hereafter entered into,
in accordance with the terms of this Agreement, to evidence or secure any
obligation of the Seller (or any Single Purpose Entity) to any Landlord
regarding any Facility.
Leases: Collectively, all leases, subleases, licenses, agreements,
concession agreements, tenancy at will agreements, room rentals and rentals of
other facilities of the Property and all other occupancy agreements of every
kind and nature, whether oral or in writing, now in existence or subsequently
entered into, encumbering or affecting all or any portion of the Property,
including, without limitation, the Facility Leases; but, excluding all Operating
Agreements.
Legal Requirements: Collectively, all statutes, ordinances, by-laws, codes,
rules, rulings, regulations, restrictions, orders, judgments, decrees, writs,
judicial or administrative interpretations and injunctions (including, without
limitation, all applicable building, health code, zoning, subdivision and other
land use and health-care, assisted living and senior housing licensing statutes,
ordinances, by-laws, codes, rules and regulations), whether now or hereafter
enacted, promulgated or issued by any Governmental Authority affecting any
member of the Selling Group and/or all or any portion of the Property or the
ownership, construction, development, maintenance, management, repair, use,
occupancy, possession or operation thereof or the operation of any programs or
services in connection with all or any portion of the Property, including,
without limitation, any of the foregoing which may (a) require repairs,
modifications or alterations in or to all or any portion of the Property, (b) in
any way affect (adversely or otherwise) the use and enjoyment of all or any
portion of the Property and/or (c) require the assessment, monitoring, clean-up,
containment, removal, remediation or other treatment of any Hazardous Substances
on, under or from all or any portion of the Property. Without limiting the
foregoing, the term Legal Requirements includes all Applicable Environmental
Laws and shall also include Permitted Encumbrances and all Permits and Contracts
issued by or entered into with any Governmental Authority and/or Accreditation
Body.
Letters of Credit: Collectively, the Existing Letters of Credit, the Blue
▇▇▇▇ Letter of Credit, the Richmond Letter of Credit, the Montgomery Letter of
Credit and the West Bloomfield Hills Letter of Credit and any other letter of
credit obtained by the Seller (or any Single Purpose Entity) and issued to any
Landlord as collateral for the obligations of the Seller or such Single Purpose
Entity under the terms of any of the Existing Lease Documents.
License Agreement: As defined in Section 8.2 of this Agreement.
Lien: With respect to any real or personal property, any mortgage,
easement, restriction, lien, pledge, collateral assignment, hypothecation,
charge, security interest, title
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retention agreement, levy, execution, seizure, attachment, garnishment or other
encumbrance of any kind in respect of such property, whether or not ▇▇▇▇▇▇,
vested or perfected.
Limited Parties: Collectively, the Seller, the General Partner, ▇▇▇▇▇▇, the
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, ▇▇. 1996 Irrevocable Trust and any other Principal.
Liquidated Damages Amount: An amount equal to SIX MILLION FOUR HUNDRED
THOUSAND DOLLARS ($6,400,000); provided, however, that (i) upon the Buyer's
approval of all of the items referred to in Section 8.12(k) or Section 8.12(l),
in each such instance, the Liquidated Damages Amount shall be increased by SIX
HUNDRED THOUSAND DOLLARS ($600,000), (ii) in the event that the Seller or the
Buyer exercises its option to exclude any Facility from this Agreement in
accordance with the terms hereof, the Liquidated Damages Amount shall be reduced
by an amount equal to the then applicable Liquidated Damages Amount divided by
the number of Facilities with respect to which the Buyer and the Seller had Call
Rights or Put Rights hereunder immediately prior to such exclusiion, (iii) in
the event that any Closing relating to any Facility is not consummated on or
before the Outside Closing Date relating to such Facility, for any reason other
than a Buyer Default, the Liquidated Damages Amount shall be reduced by an
amount equal to the then applicable Liquidated Damages Amount divided by the
number of Facilities with respect to which the Buyer and the Seller had Call
Rights or Put Rights hereunder immediately prior to the expiration of such
Outside Closing Date and (iv) upon the consummation of each Closing hereunder,
the Liquidated Damages Amount shall be reduced by an amount equal to the then
applicable Liquidated Damages Amount divided by the number of Facilities with
respect to which the Buyer and the Seller had Call Rights or Put Rights
hereunder immediately prior to the consummation of such Closing.
LLC Agreement: A limited liability (or operating) agreement in form and
substance reasonably acceptable to the Buyer.
Loan Assignment and Assumption Documents: As defined in Section 8.14 of
this Agreement.
Losses: As defined in Section 13 of this Agreement.
Management Agreement: Any agreement, whether written or oral, now existing
or hereafter entered into, between the Seller or any Single Purpose Entity and
any other Person pursuant to which the Seller or such Single Purpose Entity
provides any payment, fee or other consideration to such other Person to operate
or manage any Facility.
Manager: Any Person who now or hereafter has entered into a Management
Agreement with the Seller or any Single Purpose Entity.
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Mandatory Agreement: With respect to any Facility, any Operating Agreement
that provides for payments equal to or less than TEN THOUSAND ($10,000) per
year.
Maximum Amount: With respect to each Facility, the maximum amount of the
proceeds to be advanced under the applicable Development Agreement, which amount
is shown on the corresponding budget for such Facility and EXHIBIT I-1 attached
hereto and, subject to Section 8.12 hereof, may not be increased without the
prior written consent of the Buyer, in each instance, which consent may be
withheld in the Buyer's sole and absolute discretion.
Membership Assignment: As defined in Section 9.3 of this Agreement.
MLD: MLD Delaware Trust, a Delaware business trust.
Montgomery Architect's Agreement: The Agreement for Architectural and
Design Services hereafter entered into between the Seller (or any Single Purpose
Entity) and an architect licensed to do business in Alabama (reasonably
acceptable to the Buyer and any applicable Future Lender) relating to the
Montgomery Plans and Specifications, which is approved by the Buyer and the
applicable Future Lender.
Montgomery Budget: A line item budget setting forth the total cost for the
design and construction of the Montgomery Facility, in form and substance
acceptable to the Buyer and any applicable Future Lender.
Montgomery Closing: The Closing relating to the Montgomery Facility and the
applicable portion of the Property related thereto.
Montgomery Closing Date: The Closing Date relating to the Montgomery
Closing.
Montgomery Construction Contract: An agreement hereafter entered into
between the Seller (or any Single Purpose Entity) and a general contractor
licensed to do business in Alabama (reasonably acceptable to the Buyer and any
applicable Future Lender) relating to construction of the Montgomery Facility in
accordance with the ▇▇▇▇▇▇▇▇▇▇ Plans and Specifications, which is approved by
the Buyer and the applicable Future Lender.
Montgomery Development Agreement: Any development agreement hereafter
entered into, in accordance with the terms hereof, by and between the Seller (or
any Single Purpose Entity) and any Future Lender in connection with any Future
Financing hereafter consummated in accordance with the terms hereof, pursuant to
which, such Future Lender shall agree to provide to the Seller (or any Single
Purpose Entity) the funds necessary to develop and construct the Montgomery
Facility in accordance with the ▇▇▇▇▇▇▇▇▇▇ Plans and Specifications and the
terms of this Agreement.
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Montgomery Environmental Report: A phase I site assessment report relating
to the Montgomery Real Property prepared by a qualified geotechnical or
engineering firm in form and substance reasonably acceptable to the Buyer,
disclosing, at a minimum (a) the results of a review of prior uses of the
Montgomery Real Property disclosed by public records and contacts with public
officials; (b) the results of a review of local, state and federal records to
determine whether the Montgomery Real Property or any nearby parcels of land
have been identified as sites which have been contaminated by the release of
Hazardous Substances; the status of any on-going investigations of such sites by
the applicable governmental authorities (and the results thereof); the remedial
action required or recommended by the applicable Governmental Authorities in
connection therewith; whether there is any hydrogeological linkage between such
sites and the Montgomery Real Property and the risk of contamination to the
Montgomery Real Property emanating from such sites; (c) the results of contacts
with Governmental Authorities to determine whether any records exist with
respect to the use, release, storage, transportation or disposal of Hazardous
Substances from or at the Montgomery Real Property; (d) the location, size and
condition of all underground storage tanks and whether the use (or abandonment)
of such tanks is in compliance with the Applicable Environmental Laws; and (e)
the results of a site inspection of the ▇▇▇▇▇▇▇▇▇▇ Real Property.
Montgomery Facility: The one-story assisted living facility with not less
than fifty-four (54) units to be constructed on the ▇▇▇▇▇▇▇▇▇▇ Real Property.
Montgomery Intellectual Property: The Intellectual Property relating to the
Montgomery Facility.
Montgomery Letter of Credit: Collectively, any and all letters of credit
obtained by the Seller (or any Single Purpose Entity) and issued to any Future
Lender as collateral for the obligations of the Seller or such Single Purpose
Entity under the terms of the Future Financing Documents (hereafter entered into
in accordance with the terms of this Agreement) relating to the ▇▇▇▇▇▇▇▇▇▇
Property.
Montgomery Permitted Encumbrances: Collectively, such matters as are taken
as exceptions in the Seller's Title Insurance Policy to be issued pursuant to
the Montgomery Title Insurance Commitment; provided, that the same have been
reviewed and approved by the Buyer.
▇▇▇▇▇▇▇▇▇▇ Plans and Specifications: The final plans and specifications for
the construction and equipping of the Montgomery Facility, including, without
limitation, all schematic and working drawings, prepared by the applicable
Architect under the Montgomery Architect's Agreement and approved by all
appropriate Governmental Authorities, the Buyer and the applicable Future
Lender.
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▇▇▇▇▇▇▇▇▇▇ Property: Collectively, the Montgomery Real Property, the
Montgomery Tangible Personal Property and the Montgomery Intellectual Property.
Montgomery Purchase Agreement: That certain Purchase Agreement, dated as of
January 14, 1998, between the Seller, as Buyer and A. ▇▇▇▇ ▇▇▇▇▇▇, individually,
▇▇▇▇ ▇. ▇▇▇▇▇▇, individually and A. ▇▇▇▇ ▇▇▇▇▇▇, as Trustee of Trust "B" under
the Will of Belle ▇. ▇▇▇▇▇▇▇, as Sellers, as amended by (a) Addendum dated
February 27, 1998, (b) Addendum II dated February 27, 1998, (c) Addendum III
dated May 6, 1998 and (d) Addendum IV dated June 23, 1998.
Montgomery Purchase Documents: Collectively, all documents, instruments and
other materials that are necessary to consummate the acquisition of the
Montgomery Real Property pursuant to the terms of the Montgomery Purchase
Agreement.
Montgomery Real Property: The real property that is the subject of the
Montgomery Purchase Agreement and is described on EXHIBIT A-10 attached hereto
and all improvements now or hereafter located thereon (including, without
limitation, the Montgomery Facility).
Montgomery Survey: A current survey of the Montgomery Real Property,
satisfactory in form and content to the Buyer, that is prepared and signed by a
surveyor licensed to do business in Alabama.
Montgomery Tangible Personal Property: The Tangible Personal Property
relating to the ▇▇▇▇▇▇▇▇▇▇ Real Property.
Montgomery Title Insurance Commitment: Lawyers Title Insurance Corporation
Title Insurance Commitment No. 2951-124, effective June 9, 1998.
Naples Budget: The budget relating to the Naples Property attached hereto
as EXHIBIT B-7.
Naples Closing: The Closing relating to the Naples Facility and the
applicable portion of the Property related thereto.
Naples Closing Date: The Closing Date relating to the Naples Closing.
Naples Construction Contract: That certain Construction Contract, dated as
of June 17, 1996, by and between the Seller and ▇▇▇▇▇▇ Construction Company,
Inc.
Naples Development Agreement: That certain Development Agreement, dated as
of July 30, 1996, by and between NHP and the Seller.
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Naples Facility: The one-story assisted living facility with fifty (50)
units commonly known as Windsor Court located on the Naples Real Property with
an address of ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇.
Naples Intellectual Property: The Intellectual Property relating to the
Naples Facility.
Naples Joint Access Agreement: As defined in Section 6.38 of this
Agreement.
Naples Lease: That certain Lease and Security Agreement, dated as of July
30, 1996, by and between NHP, as Landlord and the Seller, as Tenant, as amended
by First Amendment to Lease and Security Agreement and Related Documents
(Naples, Florida), dated as of January 21, 1998, by and among NHP, the Seller
and the Guarantor.
Naples Lease Documents: Collectively, all of the Existing Lease Documents
relating to the Naples Property described on EXHIBIT D attached hereto and any
Lease Documents relating to the Naples Property entered into after the date
hereof in accordance with the terms hereof.
Naples Letter of Credit: Collectively, (a) that certain Letter of Credit
(No. F700609), dated July 28, 1997, in the original principal amount of TWO
HUNDRED FORTY THOUSAND DOLLARS ($240,000.00) issued by SunTrust Bank for the
benefit of NHP, as amended by Amendment No. 1 dated September 3, 1997 and
Amendment No. 2 dated May 20, 1998 and (b) that certain Letter of Credit (No.
F700624), dated August 21, 1997, in the original principal amount of TWO HUNDRED
FORTY THOUSAND DOLLARS ($240,000.00) issued by SunTrust Bank for the benefit of
the Seller amended by Amendment No. 1 dated September 3, 1997 and Amendment No.
2 dated May 20, 1998.
Naples Lien: That certain Claim Of Lien For Unpaid Assessments recorded in
the Official Records of ▇▇▇▇▇▇▇ County, Florida in Book 2361, Page 1055.
Naples Memorandum of Lease: The Memorandum of Lease relating to the Naples
Lease described on EXHIBIT D attached hereto.
Naples Permitted Encumbrances: Collectively, the matters relating to the
Naples Property described on EXHIBIT E attached hereto and any matters relating
to the Naples Property hereafter created in accordance with the terms hereof.
Naples Planned Unit Development Approvals: Ordinance No. 77-7 adopted by
the ▇▇▇▇▇▇▇ County Board of County Commissioners, as amended by Ordinance ▇▇.
▇▇-▇▇.
-▇▇-
▇▇▇▇▇▇ ▇▇▇▇▇ and Specifications: Collectively, the plans and specifications
relating to the Naples Real Property described on EXHIBIT C-7 attached hereto.
Naples Property: Collectively, the Naples Real Property, the Naples
Tangible Personal Property and the Naples Intellectual Property.
Naples Real Property: The real property described on EXHIBIT A-7
attached hereto and all improvements now or hereafter located thereon
(including, without limitation, the Naples Facility).
Naples Tangible Personal Property: The Tangible Personal Property relating
to the Naples Real Property.
Naples Title Insurance Policy: That certain Owner's Leasehold Title
Insurance Policy No. OPL-68788, dated August 2, 1996, issued to NHP in the
amount of $4,800,000.00 by Attorneys' Title Insurance Fund, Inc., as amended by
Endorsement dated August 2, 1996 correcting Schedule A so as to (i) name the
Seller as the insured, (ii) correct the interest insured under the policy as a
leasehold interest, (iii) reference the Naples Memorandum of Lease and (iv) add
the two (2) easement parcels included in the Naples Real Property to Exhibit A
of such Schedule A.
NHP: Nationwide Health Properties, Inc., a Maryland corporation.
Nominee: As defined in Section 32 of this Agreement.
Non-Competition Agreement: An agreement to be executed by any Principal in
form and substance reasonably acceptable to the Buyer, pursuant to which, such
Principal shall agree to be bound by the non-competition provisions set forth in
Section 8.6 of this Agreement.
Omnibus Letter Agreement: That certain letter dated August 24, 1995 from
Architectural Concepts, Inc. to, and accepted by, Liberty Health Care (an
Affiliate of the Seller).
Operating Agreements: Collectively, all service, repair, maintenance,
operation and other contracts or agreements now or hereafter entered into by the
Seller or any Manager which relate to or affect the use, operation and/or
enjoyment of the Property or any portion thereof, including, without limitation,
equipment leases and vehicle leases, but, excluding any Management Agreements.
Operating Permits: As defined in Section 6.29 of this Agreement and with
respect to each Facility, as set forth on EXHIBIT K attached hereto.
-▇▇-
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Date: As defined in Section 3 of this Agreement.
Overland Park Budget: The budget relating to the Overland Park Property
attached hereto as EXHIBIT B-8.
Overland Park Closing: The Closing relating to the Overland Park Facility
and the applicable portion of the Property related thereto.
Overland Park Closing Date: The Closing Date relating to the Overland Park
Closing.
Overland Park Construction Contract: That certain Agreement, dated as of
December 23, 1997, by and between the Seller, as Owner and Excel Construction,
Inc., as Contractor.
Overland Park Development Agreement: That certain Development Agreement,
dated as of January 23, 1998, by and between Seller, as Developer, and HCPI, as
Owner.
Overland Park Facility: The two-story assisted living facility with
eighty-four (84) units to be constructed on the Overland Park Real Property.
Overland Park Geotechnical Report: That certain Geotechnical Engineering
Report (A-OG97-464E), dated November 8, 1997, prepared by Alpha-Omega Geotech,
Inc., relating to the Overland Park Real Property.
Overland Park Intellectual Property: The Intellectual Property relating to
the Overland Park Facility.
Overland Park Lease: That certain Lease, dated as of January 23, 1998, by
and between HCPI, as Lessor, and Seller, as Lessee.
Overland Park Lease Documents: Collectively, all of the Lease Documents
relating to the Overland Park Property described on EXHIBIT D attached hereto.
Overland Park Letter of Credit: That certain Letter of Credit Number
P100392, in the original principal amount of THREE HUNDRED SIXTY-FOUR THOUSAND
TWO HUNDRED FIFTY DOLLARS ($364,250) issued on January 16, 1998 by SunTrust Bank
for the benefit of HCPI as security for the Seller's obligations under the
Overland Park Lease Documents, as amended by Amendment No. 001, dated January
22, 1998 (reducing the stated amount to THREE HUNDRED FORTY-SEVEN THOUSAND ONE
HUNDRED THIRTY DOLLARS ($347,130)), Amendment No. 002, dated January 23, 1998,
and Amendment
-▇▇-
▇▇. ▇▇▇, dated April 14, 1998 (increasing the stated amount to THREE HUNDRED
FIFTY- TWO THOUSAND SEVEN HUNDRED NINETY-THREE DOLLARS ($352,793)).
Overland Park Permitted Encumbrances: Collectively, the matters relating to
the Overland Park Property described on EXHIBIT E attached hereto and any
matters relating to the Overland Park Property hereafter created in accordance
with the terms hereof.
Overland Park Plans and Specifications: Collectively, the plans and
specifications relating to the Overland Park Real Property described on EXHIBIT
C-8 attached hereto.
Overland Park Property: Collectively, the Overland Park Real Property, the
Overland Park Tangible Personal Property and the Overland Park Intellectual
Property.
Overland Park Real Property: The real property described on EXHIBIT A-8 and
all improvements now or hereafter located thereon.
Overland Park Site Plan: That certain site plan entitled "Final Site
Development Plan," prepared by ▇▇▇▇▇▇ ▇▇▇▇▇, dated October 23, 1997.
Overland Park Special Permit: Special Use Permit No. 97-36 relating to the
Overland Park Real Property issued by the City Council of the City of Overland
Park, Kansas pursuant to Ordinance No. Z-2562.
Overland Park Tangible Personal Property: The Tangible Personal Property
relating to the Overland Park Real Property.
Overland Park Title Insurance Policy: That certain Leasehold Owner's Title
Insurance Policy No. ▇▇▇-▇▇-▇▇▇▇▇▇, dated March 4, 1998, issued to the Seller in
the amount of $7,285,000 by Lawyers Title Insurance Corporation.
Partnership Agreement: That certain Agreement of Limited Partnership of
National Assisted Living Limited Partnership, a Florida limited partnership,
dated as of September 28, 1995 by and among National Assisted Living, Inc., a
Florida corporation, and the Limited Partners named therein, together with the
Certificate of Limited Partnership of National Assisted Living Limited
Partnership dated September 19, 1995 and filed with the Florida Secretary of
State's Office on September 28, 1995, as the same may be amended from time to
time.
Permits: Collectively, all licenses, approvals, qualifications, rights,
variances, permissive uses, certificates of need, franchises, accreditations,
certificates, certifications, consents, permits and other authorizations
(including, without limitation, building permits, subdivision approvals and
subdivision plans) benefiting, relating to or affecting the Property
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and the ownership, construction, development, maintenance, management, repair,
use, occupancy, possession or operation thereof or the operation of any programs
or services in conjunction with the Property (or any portion thereof) and all
renewals, replacements and substitutions therefor, now or hereafter issued by or
entered into with any Governmental Authority or maintained or used by any member
of the Selling Group or entered into by any member of the Selling Group.
Permitted Encumbrances: Collectively, the Facility Leases, all other Lease
Documents, the Future Financing Documents, the Resident Agreements permitted in
accordance with the terms of Section 8.16 hereof, the matters described on
EXHIBIT E attached hereto and all other Liens that may hereafter be created or
permitted to exist in accordance with the terms of this Agreement.
Person: Any individual, corporation, general partnership, limited
partnership, stock company or association, joint venture, company, trust, bank,
trust company, land trust, business trust, unincorporated association,
unincorporated organization, Governmental Authority or any other entity of any
kind or nature.
Primary Intended Use: With respect to each Facility and the applicable
portion of the Property related thereto, as defined on EXHIBIT J attached
hereto.
Principal: Any Person now or hereafter holding, directly or indirectly, an
equity interest in the Seller greater than ten percent (10%).
Project Plans: Collectively, the Naples Plans and Specifications, the
Carmel Plans and Specifications, the Dublin Plans and Specifications, the
Germantown Plans and Specifications, the Birmingham Plans and Specifications,
the Overland Park Plans and Specifications, the Hockessin Plans and
Specifications, the Blue ▇▇▇▇ Plans and Specifications, the Richmond Plans and
Specifications, the Montgomery Plans and Specifications and the West Bloomfield
Hills Plans and Specifications.
Property: Collectively, the Naples Property, the Carmel Property, the
Dublin Property, the Germantown Property, the Birmingham Property, the Overland
Park Property, the Hockessin Property, the Blue ▇▇▇▇ Property, the Richmond
Property, the Montgomery Property and the West Bloomfield Hills Property.
Put Notice: As defined in Section 2 of this Agreement.
Put Right: As defined in Section 2 of this Agreement.
Real Estate Taxes: In connection with any EBITDA calculation to be made
hereunder, for any period relevant to the EBITDA calculation, the amount of the
Real Estate
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Taxes shall equal the greater of (a) the actual amount of the real estate taxes
relating to the applicable Facility (and the applicable portion of the Property
relating thereto) and (b) in the event that for any portion of the period
relevant to the EBITDA calculation the then current real estate tax assessment
for such Facility (and the applicable portion of the Property relating thereto)
does not reflect an assessment for a completely constructed Facility, an amount
equal to the product of the (i) applicable tax rate multiplied by (ii) the
amount advanced under the applicable Development Agreement relating to such
Facility.
Real Property: Collectively, the Naples Real Property, the Carmel Real
Property, the Dublin Real Property, the Germantown Real Property, the Birmingham
Real Property, the Overland Park Real Property, the Hockessin Real Property, the
Blue ▇▇▇▇ Real Property, the Richmond Real Property, the Montgomery Real
Property and the West Bloomfield Hills Property.
Reliance Letter: A letter relating to any Environmental Report addressed to
the Buyer (or, if applicable, any Single Purpose Entity) from the environmental
consultant that prepared such Environmental Report, in form and substance
reasonably acceptable to the Buyer, allowing the Buyer (or such Single Purpose
Entity) to rely on such Environmental Report.
Rent Roll: As defined in Section 9.1 of this Agreement.
Rents: Collectively, all rents, revenues, royalties, issues, profits, fees,
charges, rack rates and other payments for the use or occupancy of rooms or
other facilities of the Real Property, insurance proceeds, condemnation awards,
license fees, concession fees and all other income and security of every kind
and nature due by virtue of the Leases other than the Facility Leases.
Repairs: As defined in Section 8.22 of this Agreement.
Replacement Letters of Credit: As defined in Section 8.13 of this
Agreement.
Resident: Any individual residing at any Facility pursuant to any Resident
Agreement.
Resident Agreements: Collectively, all Leases now or hereafter executed or
entered into by or on behalf of any individual allowing such individual to
reside at any of the Facilities.
Richmond Architect's Agreement: That certain Agreement dated as of February
9, 1998 by and between the Seller, as Owner, and Architecture, Inc., as
Architect, relating to the Richmond Development Project.
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Richmond Budget: A line item budget setting forth the total cost for the
design and construction of the Richmond Facility, in form and substance
acceptable to the Buyer and any Future Lender.
Richmond Closing: The Closing relating to the Richmond Facility and the
applicable portion of the Property related thereto.
Richmond Architect's Agreement: That certain Agreement, dated as of
February 19, 1998, by and between the Seller, as Owner and Architecture, Inc.,
as Architect.
Richmond Construction Contract: An agreement hereafter entered into between
the Seller (or any Single Purpose Entity) and a general contractor licensed to
do business in Virginia (reasonably acceptable to the Buyer and any applicable
Future Lender) relating to construction of the Richmond Facility in accordance
with the Richmond Plans and Specifications, which is approved by the Buyer and
the applicable Future Lender.
Richmond Development Agreement: Any development agreement hereafter entered
into, in accordance with the terms hereof, by and between the Seller (or any
Single Purpose Entity) and any Future Lender in connection with any Future
Financing hereafter consummated in accordance with the terms hereof, pursuant to
which, such Future Lender shall agree to provide to the Seller (or any Single
Purpose Entity) the funds necessary to develop and construct the Richmond
Facility in accordance with the Richmond Plans and Specifications and the terms
of this Agreement.
Richmond Easement Agreement: That certain County of Chesterfield, Virginia
Storm Water Management System/Best Management Practice (BMP)/Easement Agreement,
dated September 26, 1995, by and between The Salisbury Corporation and County of
Chesterfield, Virginia, recorded in the Clerk's Office of the Circuit Court of
Chesterfield County, Virginia in Book 2758, Page 542.
Richmond Facility: The one-story assisted living facility with not less
than eighty-three (83) units to be constructed on the Richmond Real Property.
Richmond Intellectual Property: The Intellectual Property relating to the
Richmond Facility.
Richmond Letter of Credit: Collectively, any and all letters of credit
obtained by the Seller (or any Single Purpose Entity) and issued to any Future
Lender as collateral for the obligations of the Seller or such Single Purpose
Entity under the terms of the Future Financing Documents (hereafter entered into
in accordance with the terms of this Agreement) relating to the Richmond
Property.
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Richmond Permitted Encumbrances: Collectively, such matters as are taken as
exceptions in the Seller's Title Insurance Policy to be issued pursuant to the
Richmond Title Insurance Commitment; provided, that the same have been reviewed
and approved by the Buyer.
Richmond Plans and Specifications: The final plans and specifications for
the construction and equipping of the Richmond Facility, including, without
limitation, all schematic and working drawings, prepared by the applicable
Architect under the Richmond Architect's Agreement and approved by all
appropriate Governmental Authorities, the Buyer and the applicable Future
Lender.
Richmond Property: Collectively, the Richmond Real Property, the Richmond
Tangible Personal Property and the Richmond Intellectual Property.
Richmond Purchase Agreement: That certain Purchase Agreement, dated as of
January 16, 1998, by and between the Seller, as Buyer and The Salisbury
Corporation, as Seller, as amended by Addendum One dated as of April 28, 1998.
Richmond Purchase Documents: Collectively, all documents, instruments and
other materials that are necessary to consummate the acquisition of the Richmond
Real Property pursuant to the terms of the Richmond Purchase Agreement.
Richmond Real Property: The real property that is the subject of the
Richmond Purchase Agreement and is described on EXHIBIT A-9 attached hereto and
all improvements now or hereafter located thereon (including, without
limitation, the Richmond Facility).
Richmond Survey: A current survey of the Richmond Real Property,
satisfactory in form and content to the Buyer, that is prepared and signed by a
surveyor licensed to do business in Virginia.
Richmond Tangible Personal Property: The Tangible Personal Property
relating to the Richmond Real Property.
Richmond Title Insurance Commitment: That certain Owner's Title Insurance
Commitment dated March 18, 1998 issued to HCPI by Lawyers Title Insurance
Corporation.
Seller: As defined in the preamble of this Agreement and its successors and
assigns.
Seller Documents: Collectively, all documents required to be delivered by
the Seller at any Closing in order to effectuate the consummation thereof.
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Seller's Title Insurance Commitments: Collectively, the Blue ▇▇▇▇ Title
Insurance Commitment, the Richmond Title Insurance Commitment, the Montgomery
Title Insurance Commitment and the West Bloomfield Hills Title Insurance
Commitment.
Seller's Title Insurance Policies: Collectively, the Naples Title Insurance
Policy, the Carmel Title Insurance Policy, the Dublin Title Insurance Policy,
the Germantown Title Insurance Policy, the Birmingham Title Insurance Policy,
the Overland Park Title Insurance Policy, the Hockessin Title Insurance Policy
and any title insurance policy hereafter issued pursuant to the Seller's Title
Insurance Commitments.
Selling Group: Collectively, the Seller and the Single Purpose Entities
(but with respect to each Single Purpose Entity, only until the date, if any,
that the Buyer acquires all of the equity interests in such Single Purpose
Entity).
Single Purpose Entity: A single purpose, bankruptcy remote entity that (a)
is a Delaware limited liability company (unless an Alternative Ownership
Structure is required by the Buyer pursuant to the terms of Section 8.2 of this
Agreement), (b) is wholly-owned by the Seller, (c) is created by a LLC Agreement
(or, if applicable, such other organizational documents that are in form and
substance reasonably acceptable to the Buyer), (d) is engaged in no business or
other venture during its existence other than the ownership or leasing and
operation of any Facility and (e) enters into no contractual agreement (whether
written or oral) other than such contractual agreements as may be expressly
permitted hereunder.
States: Collectively, the states and commonwealths in which the Property is
located.
Subsidiary: With respect to any Person, any corporation or other entity,
fifty percent (50%) or more of the outstanding capital stock or other ownership
interest having general voting power (under ordinary circumstances) of which, is
owned or controlled, directly or indirectly (through one or more Subsidiaries)
by any such Person.
Tangible Net Worth: An amount determined in accordance with GAAP equal to
the total assets of any Person (excluding the total intangible assets of such
Person) minus the total liabilities of such Person. Total intangible assets
shall be deemed to include, but shall not be limited to, the excess of cost over
book value of acquired businesses accounted for by the purchase method, formula,
trademarks, trade names, patents, patent rights and deferred expenses
(including, but not limited to, unamortized debt discount and expense,
organizational expense and experimental and development expenses).
Tangible Personal Property: Collectively, all machinery, apparatus,
appliances, chattels, equipment, furniture, fittings, fixtures, draperies,
curtains, tools, supplies and all other articles of personal property of every
kind and nature whatsoever owned (or leased, pursuant to the Lease Documents or
the Future Financing Documents) by the Seller, any
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Single Purpose Entity or any other Affiliate of the Seller, now or hereafter
located in or upon the Real Property (or any portion thereof) and used or
useable in connection with any present or future use, development, operation,
management and/or occupation of the Real Property (portion thereof).
Tenants: Collectively, the holders of any lessee's interest under any of
the Leases other than the Facility Leases and the Resident Agreements.
Termination Date: December 31, 2002. Title Insurance Company: Any title
insurance company that issues any of the Buyer's Title Insurance Policies.
Total Option Payment: Collectively, the Initial Option Payment and the
Additional Option Payments.
Transfer Documents: As defined in Section 8.2 of this Agreement.
Transfer Notice: As defined in Section 2 of this Agreement.
Transfer Right: As defined in Section 2 of this Agreement.
Undeveloped Site: As defined in Section 22 of this Agreement.
▇▇▇▇▇▇: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, ▇▇., a resident of Naples, Florida.
West Bloomfield Hills Architect's Agreement: That certain Agreement, dated
as of February 19, 1998, by and between the Seller, as Owner and Architecture,
Inc., as Architect, relating to the West Bloomfield Hills Development Project.
West Bloomfield Hills Budget: A line item budget setting forth the total
cost for the design and construction of the West Bloomfield Hills Facility, in
form and substance acceptable to the Buyer and any applicable Future Lender.
West Bloomfield Hills Closing: The Closing relating to the West Bloomfield
Hills Facility and the applicable portion of the Property related thereto.
West Bloomfield Hills Construction Contract: An agreement hereafter entered
into between the Seller (or any Single Purpose Entity) and a general contractor
licensed to do business in Michigan (reasonably acceptable to the Buyer and any
applicable Future Lender) relating to construction of the West Bloomfield Hills
Facility in accordance with the West
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Bloomfield Hills Plans and Specifications, which is approved by the Buyer and
the applicable Future Lender.
West Bloomfield Hills Development Agreement: Any development agreement
hereafter entered into, in accordance with the terms hereof, by and between the
Seller (or any Single Purpose Entity) and any Future Lender in connection with
any Future Financing hereafter consummated in accordance with the terms hereof,
pursuant to which, such Future Lender shall agree to provide to the Seller (or
any Single Purpose Entity) the funds necessary to develop and construct the West
Bloomfield Hills Facility in accordance with the West Bloomfield Hills Plans and
Specifications and the terms of this Agreement.
West Bloomfield Hills Environmental Report : A phase I environmental site
assessment report relating to the West Bloomfield Hills Real Property prepared
by a qualified geotechnical or engineering firm in form and substance reasonably
acceptable to the Buyer, disclosing, at a minimum (a) the results of a review of
prior uses of the West Bloomfield Hills Real Property disclosed by public
records and contacts with public officials; (b) the results of a review of
local, state and federal records to determine whether the West Bloomfield Hills
Real Property or any nearby parcels of land have been identified as sites which
have been contaminated by the release of Hazardous Substances; the status of any
on-going investigations of such sites by the applicable governmental authorities
(and the results thereof); the remedial action required or recommended by the
applicable Governmental Authorities in connection therewith; whether there is
any hydrogeological linkage between such sites and the West Bloomfield Hills
Real Property and the risk of contamination to the West Bloomfield Hills Real
Property emanating from such sites; (c) the results of contacts with
Governmental Authorities to determine whether any records exist with respect to
the use, release, storage, transportation or disposal of Hazardous Substances
from or at the West Bloomfield Hills Real Property; (d) the location, size and
condition of all underground storage tanks and whether the use (or abandonment)
of such tanks is in compliance with the Applicable Environmental Laws; and (e)
the results of a site inspection of the West Bloomfield Hills Real Property.
West Bloomfield Hills Facility: The two-story assisted living facility with
not less than fifty (50) units to be constructed on the West Bloomfield Hills
Real Property.
West Bloomfield Hills Intellectual Property: The Intellectual Property
relating to the West Bloomfield Hills Facility.
West Bloomfield Hills Letter of Credit: Collectively, any and all letters
of credit obtained by the Seller (or any Single Purpose Entity) and issued to
any Landlord or other Future Lender as collateral for the obligations of the
Seller or such Single Purpose Entity under the terms of the Future Financing
Documents relating to the West Bloomfield Hills Property.
-▇▇-
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ Permitted Encumbrances: Collectively, such matters as
are taken as exceptions in the Seller's Title Insurance Policy to be issued
pursuant to the West Bloomfield Hills Title Insurance Commitment: provided,
that, the same have been reviewed and approved by the Buyer.
West Bloomfield Hills Plans and Specifications: The final plans and
specifications for the construction and equipping of the West Bloomfield Hills
Facility, including, without limitation, all schematic and working drawings,
prepared by the applicable Architect under the West Bloomfield Hills Architect's
Agreement and approved by all appropriate Governmental Authorities, the Buyer
and the applicable Future Lender.
West Bloomfield Hills Survey: A current survey of the West Bloomfield Hills
Real Property, satisfactory in form and content to the Buyer and certified to
the Buyer, that is prepared and signed by a surveyor licensed to do business in
Michigan.
West Bloomfield Hills Property: Collectively, the West Bloomfield Hills
Real Property, the West Bloomfield Hills Tangible Personal Property and the West
Bloomfield Hills Intellectual Property.
West Bloomfield Hills Purchase Agreement: That certain Purchase Agreement,
dated October 3, 1997, between the Seller, as Buyer and E. ▇▇▇▇▇▇ ▇▇▇▇▇▇ and
▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, as Seller, as amended by Amendment to Purchase Agreement
dated March 2, 1998, as further amended by Amendment to Purchase Agreement dated
July 9, 1998.
West Bloomfield Hills Purchase Documents: Collectively, all documents,
instruments and other materials that are necessary to consummate the acquisition
of the West Bloomfield Hills Real Property pursuant to the terms of the West
Bloomfield Hills Purchase Agreement.
West Bloomfield Hills Real Property: The real property that is the subject
of the West Bloomfield Hills Purchase Agreement and is described on EXHIBIT A-11
attached hereto, together with all improvement now or hereafter located thereon
(including, without limitation, the West Bloomfield Hills Facility).
West Bloomfield Hills Tangible Personal Property: The Tangible Personal
Property relating to the West Bloomfield Hills Real Property.
West Bloomfield Hills Title Insurance Commitment: Lawyers Title Insurance
Corporation Title Insurance Commitment No. 68616-LTC effective October 22, 1997,
naming the Seller as the proposed insured and E. ▇▇▇▇▇▇ ▇▇▇▇▇▇ and ▇▇▇▇▇▇▇▇▇ ▇.
▇▇▇▇▇▇ as owners.
Work: As defined in Section 24 of this Agreement.
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2. Call Rights, Put Rights and Transfer Rights.
2.1 Call Option. Subject to the provisions hereof, the Buyer shall
have the right but not the obligation to acquire and the Seller shall have the
obligation to transfer all of its right, title and interest in the Property;
provided, that, at the time of the consummation of the closing relating to any
Facility and the applicable portion of the Property relating thereto (each, a
"Closing"), (a) subject to Section 10.2 hereof, the Seller shall have fulfilled
all of its obligations hereunder relating to such Facility and the applicable
portion of the Property relating thereto and (b) subject to the provisions of
Section 10.2 hereof, all of the conditions precedent to the Buyer's obligation
to consummate the applicable Closing set forth in Sections 10 and 11 of this
Agreement shall be satisfied (the matters referred to in the foregoing clauses
(a) and (b) are referred to herein as the "Closing Conditions"). The Buyer's
right to acquire the Seller's interest in any Facility (the "Call Right") shall
be exercisable, upon not less than thirty (30) days' prior written notice (the
"Call Notice") during the Facility's Exercise Period. Within fifteen (15) days
after the Seller's receipt of the Call Notice, the Seller shall deliver to the
Buyer the Seller's calculation of the Facility Purchase Price and the financial
information used to calculate the Facility Purchase Price. Subject to the
provisions of Section 12 hereof, the Closing relating to any Facility with
respect to which the Buyer has exercised its Call Right shall occur on the
specific date designated by the Buyer in the Call Notice, which date shall be
within the Facility's Exercise Period or no later than thirty (30) days
thereafter.
2.2 Put Option. In addition to, and notwithstanding the foregoing,
subject to the provisions hereof, the Seller shall have the right but not the
obligation to require the Buyer to acquire the Seller's interest in each
Facility or any group of Facilities at any time after such Facility or such
group of Facilities achieves Breakeven individually or in the aggregate for
three (3) consecutive months (the "Put Right"). The Seller's Put Right with
respect to any Facility shall be exercisable, upon thirty (30) days' prior
written notice (the "Put Notice"), until the earlier to occur of (i) the
applicable Facility's Expiration Date or (ii) the Termination Date. Along with
the Put Notice, the Seller shall deliver to the Buyer the Seller's calculation
of the Facility Purchase Price and the financial information used to (x)
calculate the Facility Purchase Price and (y) establish that the applicable
Facility or Facilities achieved Breakeven for three (3) consecutive months.
Subject to the provisions of Section 12, the Closing relating to any Facility or
group of Facilities with respect to which the Seller has exercised its Put Right
shall occur on the specific date which is designated by the Seller in the Put
Notice, which date shall be within the Facility's Exercise Period or no later
than thirty (30) days thereafter.
2.3 Transfer Right. Furthermore, at the election of the Seller,
exercisable with respect to each Facility, upon prior written notice to the
Buyer (the "Transfer Notice") at any time prior to the exercise of the Buyer's
Call Right or the
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Seller's Put Right relating thereto, the Seller may transfer its interest in any
Facility, the applicable portion of the Property relating thereto and the Lease
Documents or the Future Financing Documents relating thereto to a Single Purpose
Entity (the "Transfer Right"); provided, that, at its sole cost and expense, the
Seller (A) complies with the provisions of Section 8.2 hereof and (B) obtains
the following items and provides true and correct copies thereof to the Buyer
prior to the consummation of the exercise of such Transfer Right: (I) all
consents from any applicable Landlord or Future Lender whose consent is required
under the applicable Lease Documents or Future Financing Documents and (II) all
Permits from any Governmental Authorities that are required in connection with
the Seller's exercise of its Transfer Right. Notwithstanding the foregoing and
without limiting the terms of any other provisions set forth herein, none of the
applicable Lease Documents or the applicable Future Financing Documents may be
amended in connection with any exercise of the Seller's Transfer Right without
the Buyer's prior written consent, which consent may be withheld in the Buyer's
sole and absolute discretion; provided, however, that the Buyer may not withhold
its consent to any amendment of any Lease Documents or Future Financing
Documents, the sole effects of which are to substitute the Single Purpose Entity
for the Seller under the applicable Lease Documents or Future Financing
Documents and to evidence the applicable Landlord's or Future Lender's consent
thereto, but does not amend any other substantive provisions of such Lease
Documents or Future Financing Documents.
3. Option Payments. Simultaneously with the execution and delivery of this
Agreement, the Buyer shall pay by wire-transfer to the Seller the amount of ONE
MILLION DOLLARS ($1,000,000) as an option payment (the "Initial Option Payment")
in consideration of the Seller's grant of the Buyer's Call Right. One-half (1/2)
of the Initial Option Payment shall be applied to each Facility Purchase Price
payable by the Buyer with respect to the Buyer's acquisition of the Seller's
interest in the last two (2) Facilities (and the applicable portion of the
Property relating thereto) to be acquired hereunder by the Buyer, either as a
result of the Buyer's exercise of its Call Right and/or the Seller's exercise of
its Put Right (collectively, the "Last Facilities"). Within five (5) Business
Days after the Seller has delivered to the Buyer a true and correct copy of the
CO relating to any Facility, the Buyer shall pay by wire-transfer to the Seller
an additional option payment of SIX HUNDRED THOUSAND DOLLARS ($600,000) (each,
an "Additional Option Payment") as additional consideration for the Seller's
grant of the Buyer's Call Right. An Additional Option Payment shall be applied
to each Facility Purchase Price payable by the Buyer with respect to the Buyer's
acquisition of the Seller's interest in any Facility (and the applicable portion
of the Property relating thereto) or, if applicable, the Buyer's acquisition of
all of the equity interests in the applicable Single Purpose Entity that owns or
leases such Facility.
Subject to the terms of Section 12, in the event that the Closing relating
to any Facility is not consummated, due to a failure by the Seller to satisfy
the Closing Conditions relating thereto, on or before the date (the "Outside
Closing Date") that is earlier to occur of (a) the applicable Closing Date, as
the same may be extended in accordance with the terms hereof or (b) the
Termination Date, such Facility's Additional Option Payment shall be immediately
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refunded to the Buyer on the next Business Day thereafter and the Buyer's Call
Right and the Seller's Put Right relating to such Facility (and the applicable
portion of the Property related thereto) shall expire at 11:59 p.m. on the
Outside Closing Date. Subject to the terms of Section 12, upon the next Business
Day immediately after the Termination Date, if any Closing contemplated
hereunder has not been consummated due to a failure by the Seller to satisfy the
Closing Conditions relating thereto and, as a result, any portion of the Total
Option Payment has not been applied to the Facility Purchase Prices previously
paid by the Buyer in connection with the Closings consummated on or before the
Termination Date, the full amount of such remaining portion of the Total Option
Payment shall be immediately refunded to the Buyer.
4. Facility Purchase Price. At the Closing relating to any Facility (and
the applicable portion of the Property relating thereto), as long as at the time
of such Closing, the applicable Closing Conditions have been satisfied, then,
the Buyer shall pay to the Seller the applicable Facility Purchase Price (as the
same may be adjusted in accordance with the terms of this Agreement), plus, any
amounts due from Buyer pursuant to Section 8.12 hereof less the applicable
Additional Option Payment less, if such Closing involves one of the Last
Facilities, one-half (1/2) of the Initial Option Payment by wiring such amount
in immediately available federal funds to such bank account as may be designated
by the Seller.
At any time within ninety (90) days after the Buyer's receipt of the
Seller's calculation of any Facility Purchase Price and the financial
information used to calculate such Facility Purchase Price and, if applicable,
whether the applicable Facility or Facilities achieved Breakeven for three (3)
consecutive months (each such ninety (90) day period, an "Adjustment Period"),
the Buyer shall have the right, at its own expense, to have its accountants or
representatives conduct an audit (an "Audit") of the information used by the
Seller (and provided to the Buyer in accordance with Section 2 hereof) to
calculate the Facility Purchase Price and, if applicable, whether the applicable
Facility or Facilities achieved Breakeven for three (3) consecutive months and,
in connection with any such Audit, to examine the Seller's books and records
with respect thereto (including supporting data and tax returns).
If by the end of any Adjustment Period, the Buyer has not given the Seller
a notice of any objection to the Seller's calculation of the applicable Facility
Purchase Price or, if applicable, whether the applicable Facility or Facilities
achieved Breakeven for three (3) consecutive months (such notice of objection
shall contain (a) a statement of the basis of the Buyer's objection, (b) the
EBITDA as determined by the Buyer for the relevant period to calculate the
applicable Facility Purchase Price or the Buyer's calculations concerning
whether the applicable Facility or Facilities achieved Breakeven and (c) copies
of the documents and financial information on which such objection and
calculations are based), then, the Facility Purchase Price calculated by the
Seller and/or, if applicable, the Seller's determination that the Facility or
Facilities achieved Breakeven prior to the expiration of any Adjustment Period
for three (3) consecutive months will be final. If the Buyer gives such notice
of objection prior to
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the expiration of any Adjustment Period (even if any such notice of objection is
provided to the Seller subsequent to the date that the applicable Closing is
consummated), then, unless the parties resolve the issues in dispute within
thirty (30) days after the Seller's receipt of such notice of objection, such
issues in dispute will be submitted to a nationally recognized accounting firm
mutually acceptable to the Buyer and the Seller (the "Accountants") for
resolution. If such issues in dispute are submitted to the Accountants for
resolution, (i) each party will furnish to the Accountants such workpapers and
other documents and information relating to the disputed issues as the
Accountants may request and are available to that party or its Affiliates (or
its independent public accountants), and will be afforded the opportunity to
present to the Accountants any material relating to the determination and to
discuss the determination with the Accountants; (ii) the determination by the
Accountants of the applicable Facility Purchase Price and/or whether the
applicable Facility or Facilities achieved Breakeven for three (3) consecutive
months, as set forth in a notice delivered to both parties by the Accountants,
will be binding and conclusive on the parties; and (iii) the Buyer and the
Seller will each bear fifty percent (50%) of the fees of the Accountants for
such determination.
In the event that such final determination by the Accountants of any
Facility Purchase Price and/or whether the applicable Facility or Facilities
achieved Breakeven for three (3) consecutive months is made prior to the
applicable Closing Date, (x) such Facility Purchase Price shall be subject to
further adjustments in accordance with the terms of this Agreement or (y) the
Buyer shall not be required to consummate the Closing if the applicable Facility
or Facilities have not achieved Breakeven for three (3) consecutive months (and
the Seller had exercised its Put Right with respect thereto). In the event that
such final determination of the Facility Purchase Price by the Accountants is
made subsequent to such Closing Date and (I) the Facility Purchase Price
determined by the Accountants is less than the Facility Purchase Price
calculated by the Seller (without regard to any other adjustments to be made in
accordance with the terms of this Agreement), the Seller will pay the difference
to Buyer, together with interest at the prime rate as announced by the Wall
Street Journal (or such other interest rate as is hereafter mutually agreed upon
by the Buyer and the Seller) compounded monthly beginning on the applicable
Closing Date and ending on the date of payment and (II) the Facility Purchase
Price determined by the Accountants is greater than the Facility Purchase Price
calculated by the Seller, the Buyer will pay the difference to the Seller,
together with interest at the prime rate as announced by the Wall Street Journal
(or such other interest rate as is hereafter mutually agreed upon by the Buyer
and the Seller) compounded monthly beginning on the applicable Closing Date and
ending on the date of payment. All payments described in the immediately
preceding sentence will be made within ten (10) Business Days after such final
determination by the Accountants in immediately available funds to such bank
account as the receiving party may specify.
The provisions of this Section 4 shall survive the consummation of each
Closing hereunder.
5. Place of Closing. Subject to the provisions of this Agreement, for each
Closing, the Seller Documents shall be delivered by the Seller to the
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Buyer at 10:00 a.m., Eastern Standard Time, on the Closing Date at the offices
of the ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ & Fish, LLP (the "Buyer's Counsel"), ▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ or, at the Buyer's option (exercisable upon
written notice to the Seller), at such other place as is designated by the
Buyer, or at such other place as is otherwise agreed upon in writing by the
Buyer and the Seller. Notwithstanding the foregoing, the Seller may deliver all
of the Seller Documents required hereunder with respect to any Closing to the
Buyer's Counsel on or before the applicable Closing Date (to hold in escrow in
accordance with customary conveyancing practices subject to the consummation of
such Closing) by mail or overnight courier and need not attend the actual
Closing.
6. Seller's Representations and Warranties. As a material inducement for
the Buyer to enter into this Agreement and to consummate each Closing, the
Seller makes the following representations and warranties to the Buyer, which
representations and warranties are true as of the date of this Agreement and, as
a condition of the Buyer's obligation to close hereunder, shall be true and
correct as of each Closing Date; provided, that, subject to the provisions of
Section 10.2 of this Agreement, such representations and warranties shall be
treated as modified as of any Closing, and without breach of the foregoing
obligation of the Seller, by the Seller's delivery at such Closing of a
certification in substantially the form attached hereto as EXHIBIT M, reflecting
the occurrence of any event or change in the state of facts effective after the
date hereof and prior to such Closing relating to the Seller, the applicable
Facility (and the portion of the Property related thereto) or, if applicable,
the Single Purpose Entity that operates such Facility (each, a "Closing
Certification"). The following representations and warranties (as the same may
be modified by any Closing Certification acceptable to the Buyer) shall survive
each Closing and any earlier termination of this Agreement.
6.1 Legal Existence, Good Standing and Ownership Interest. The Seller
is a limited partnership duly organized, validly existing and in good standing
under the laws of Florida and has all requisite power and authority to own,
lease and operate its properties, to carry on its business as presently
conducted by it and as contemplated under the Lease Documents and to consummate
the transactions contemplated hereby. The General Partner is the sole general
partner of the Seller. The General Partner is a corporation duly organized,
validly existing and in good standing under the laws of Florida and has all
requisite power and authority to own, lease and operate its properties, to carry
on its business as presently conducted by it and as contemplated under the Lease
Documents and to consummate the transactions contemplated hereby. The Seller and
the General Partner are each duly qualified to transact business and are in good
standing in each State where any portion of the Property owned or leased by the
Seller is located and the applicable law requires the Seller and/or the General
Partner to so qualify. The Seller has delivered to the Buyer a true and complete
copy of the Partnership Agreement and the Articles of Organization and By-laws
of the General Partner, together with any and all amendments and modifications
to each of the same. As of the date hereof, ▇▇▇▇▇▇ is the only Principal. The
General Partner is the holder of 60% interest in the Seller, free and
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clear of all Liens. ▇▇▇▇▇▇ is the holder of 180 shares (constituting 18% of the
total issued and outstanding shares) of the capital stock of the General Partner
and the ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, ▇▇. 1996 Irrevocable Trust is the holder of 500 shares
(constituting 50% of the total issued and outstanding shares) of capital stock
in the General Partner.
As of the applicable Closing Date involving the acquisition of all of the
equity interests in any Single Purpose Entity by the Buyer pursuant to this
Agreement, subject to the provisions of Section 8.2, (i) such Single Purpose
Entity shall be a limited liability company duly organized, validly existing and
in good standing under the laws of Delaware and shall have all requisite power
and authority to own or lease and operate the portion of the Property that it
owns or operates and to carry on its business as contemplated hereby and by any
Lease Documents or Future Financing Documents to which such Single Purpose
Entity is a party, (ii) such Single Purpose Entity shall be duly qualified to
transact business and in good standing in the State where the Facility that it
operates is located, (iii) immediately prior to the consummation of the
applicable Closing, the Seller shall be the only member of the Single Purpose
Entity and immediately after the consummation of the applicable Closing, the
Buyer shall be the only member of the Single Purpose Entity, (iv) without
limiting the terms of any other provision set forth herein, the Seller shall
have delivered to the Buyer a true and complete copy of the LLC Agreement of the
such Single Purpose Entity, together with any and all amendments and
modifications to the same, (v) there shall be no default or breach of condition
under the LLC Agreement, nor shall have any event occurred which, with notice
and/or the passage of time, could constitute a default or breach of condition
under the LLC Agreement, (vi) there shall be no outstanding or authorized
subscriptions, options, warrants, calls, rights, commitments or other agreements
of any character which obligate or may obligate the applicable Single Purpose
Entity to issue any additional membership interests in such Single Purpose
Entity, (vii) the Seller (as the sole member of the Single Purpose Entity) shall
not have entered into any binding agreement to sell any interest in the Single
Purpose entity other than this Agreement, (viii) such Single Purpose Entity
shall be (and, during the entire time of its existence, shall have been) engaged
in no business or other venture other than the ownership or leasing and
operation of the applicable Facility and (ix) such Single Purpose Entity is a
party to no contractual obligations other than any of the Blue ▇▇▇▇ Purchase
Documents (if such Single Purpose Entity owns or leases the Blue ▇▇▇▇ Real
Property), any of the Richmond Purchase Documents (if such Single Purpose Entity
owns or leases the Richmond Real Property), any applicable Transfer Documents
and any applicable Lease Documents or Future Financing Documents.
6.2 Authority and Enforceability. This Agreement and the Existing
Lease Documents constitute, and each of the other Seller Documents, Lease
Documents and the Future Financing Documents, as of the date of the execution
and delivery thereof shall constitute, the legal, valid and binding obligations
of the Seller and/or the Single Purpose Entities to the extent that any of the
same is a party thereto, enforceable in accordance with their respective terms,
covenants and conditions. There are no claims, defenses (personal or otherwise)
or offsets to the validity or
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enforceability against the Seller or any of the Single Purpose Entities under
this Agreement, any of the other Seller Documents, any of the Lease Documents or
any of the Future Financing Documents. Neither the Seller, the Single Purpose
Entities nor any other Person with any interest in the Property (or any portion
thereof) has granted to any Person other than the Buyer a right of first
refusal, option to purchase, or other right to purchase all or any part of the
Property other than (a) the applicable lessee's option to purchase certain
portions of the Property under the Lease Documents, (b) the Seller's right to
acquire the Blue ▇▇▇▇ Property under the Blue ▇▇▇▇ Purchase Agreement, (c) the
Seller's right to acquire the Richmond Property under the Richmond Purchase
Agreement, (d) the Seller's right to acquire the ▇▇▇▇▇▇▇▇▇▇ Property under the
▇▇▇▇▇▇▇▇▇▇ Purchase Agreement and (e) the Seller's right to acquire the West
Bloomfield Hills Property under the West Bloomfield Hills Purchase Agreement.
The Seller has full power and authority to execute and deliver this Agreement
and to perform all of the Seller's obligations arising hereunder. The General
Partner has full power and authority to execute and deliver this Agreement and
the other Seller Documents (to which the Seller is a party), as the sole general
partner of the Seller. As of the applicable Closing Date involving the
acquisition of all of the equity interests in any Single Purpose Entity by the
Buyer pursuant to this Agreement, (x) such Single Purpose Entity shall have full
power and authority to execute and deliver the Seller Documents to which it is a
party and (y) the Lease Documents or the Future Financing Documents to which
such Single Purpose Entity is a party shall constitute the legal, valid and
binding obligations of such Single Purpose Entity.
6.3 No Conflict. Neither the execution, delivery and performance by
the Seller of this Agreement and the other Seller Documents to which it is a
party, nor the consummation of the Buyer's acquisition of the Seller's interest
in the Property (or any portion thereof) and/or the Single Purpose Entities
contravenes any provision of (a) the Partnership Agreement or any agreement to
which the Seller is a party, (b) any judgment, order, decree, writ or injunction
applicable to the Seller or the Property (or any portion thereof), (c) any
applicable Legal Requirements or (d) any other agreement to which the Seller is
or may hereafter be a party or by which the Seller or the Property (or any
portion thereof) may be bound or affected (including, without limitation, the
Lease Documents and the Future Financing Documents).
As of the applicable Closing Date involving the acquisition of all of the
equity interests in any Single Purpose Entity by the Buyer pursuant to this
Agreement, neither the execution, delivery and performance by such Single
Purpose Entity of any Seller Documents to which it is a party, nor the
consummation of the Buyer's acquisition of all of the equity interests in such
Single Purpose Entity will contravene any provision of (i) such Single Purpose
Entity's LLC Agreement, (ii) any judgment, order, decree, writ or injunction
applicable to such Single Purpose Entity or that portion of the Property that
such Single Purpose Entity owns or leases, (iii) any applicable Legal
Requirements or (iv) without limiting the terms of any other provision hereof,
any other agreement to which such Single Purpose Entity may be a party or
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by which such Single Purpose Entity or such portion of the Property may be bound
or affected.
6.4 No Consent or Approval. Except for (i) the Buyer's Transfer
Approvals, (ii) the pre-merger filing and waiting period requirements of the HSR
Act, (iii) the Future Permits and Contracts, (iv) the Operating Permits (other
than the Operating Permits relating to the Naples Facility and the Carmel
Facility), (v) the execution and delivery of the Blue ▇▇▇▇ Architect's
Agreement, the Blue ▇▇▇▇ Construction Contract, the Blue ▇▇▇▇ Purchase
Documents, the Richmond Construction Contract, the Richmond Purchase Documents,
the ▇▇▇▇▇▇▇▇▇▇ Architect's Agreement, the ▇▇▇▇▇▇▇▇▇▇ Construction Contract, the
▇▇▇▇▇▇▇▇▇▇ Purchase Documents, the West Bloomfield Hills Architect's Agreement,
the West Bloomfield Hills Construction Contract, the West Bloomfield Hills
Purchase Documents, the Future Financing Documents and the Buyer's approval of
the foregoing in accordance with the terms hereof, (vi) the Buyer's and any
applicable Future Lender's approval of the Blue ▇▇▇▇ Survey, the Blue ▇▇▇▇ Plans
and Specifications, the Blue ▇▇▇▇ Permitted Encumbrances, the Richmond Budget,
the Richmond Survey, the Richmond Plans and Specifications and the Richmond
Permitted Encumbrances, the ▇▇▇▇▇▇▇▇▇▇ Budget, the ▇▇▇▇▇▇▇▇▇▇ Permitted
Encumbrances, the ▇▇▇▇▇▇▇▇▇▇ Plans and Specifications, the ▇▇▇▇▇▇▇▇▇▇ Survey,
the ▇▇▇▇▇▇▇▇▇▇ Environmental Report, the West Bloomfield Hills Budget, the West
Bloomfield Hills Plans and Specifications, the West Bloomfield Hills Permitted
Encumbrances, the West Bloomfield Hills Survey and West Bloomfield Hills
Environmental Report (vii) any other approvals from the Buyer relating to the
Blue ▇▇▇▇ Property, the Richmond Property, the ▇▇▇▇▇▇▇▇▇▇ Property or the
Richmond Property as set forth hereunder, (viii) the consents of the applicable
Landlords and Future Lenders to any exercise by the Seller of its Transfer
Right, (ix) any consents required from the parties to any Assumed Operating
Agreements and (x) such consents or approvals as already obtained or filed, as
the case may be, which are listed on EXHIBIT L attached hereto, no consent or
approval or other authorization of, or exemption by, or declaration or filing
with, any Person and no waiver of any right by any Person is required to
authorize or permit, or is otherwise required as a condition of the execution
and delivery of any of this Agreement or any of the other Seller Documents and
the performance of the Seller's or any Single Purpose Entity's obligations
thereunder or as a condition to the validity and/or the enforceability of this
Agreement or any of the Seller Documents.
6.5 Financial Condition. The Seller is financially solvent and there
are no actions, suits, investigations or proceedings including, without
limitation, outstanding federal or state tax liens, garnishments or insolvency
and bankruptcy proceedings, pending or, to the best of the Seller's knowledge
and belief, threatened:
a. against or affecting the Seller, which, if adversely resolved to the
Seller, would materially adversely affect the ability of the Seller to
perform any of its
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obligations under this Agreement, any of the other Seller Documents,
any of the Lease Documents or any of the Future Financing Documents;
b. against or affecting the Property (or any portion thereof) and/or the
ownership, construction, development, maintenance, management, repair,
use, occupancy, possession or operation thereof; or
c. which may involve or affect the validity, priority and/or
enforceability of this Agreement, any of the other Seller Documents,
any of the Lease Documents or any of the Future Financing Documents,
at law or in equity, or before or by any arbitrator or Governmental
Authority.
The Seller is not a party to any agreement, the terms of which now
have or, as far as can be reasonably foreseen, may have a material adverse
effect on its financial condition or business or on the development or operation
of the Property (or any portion thereof) for its Primary Intended Use. The
Seller (i) is able to pay its debts as they become due, (ii) has sufficient
funds and capital to carry on its business as now conducted or as contemplated
to be conducted (in accordance with the terms of this Agreement, the Lease
Documents and the Future Financing Documents), (iii) owns property having a fair
market value greater than the amount required to pay its debts as they become
due and (iv) is not insolvent as determined by applicable law.
As of the applicable Closing Date involving the acquisition of all of the
equity interests in any Single Purpose Entity by the Buyer pursuant to this
Agreement, such Single Purpose Entity shall be financially solvent and there
shall be no actions, suits, investigations or proceedings including, without
limitation, outstanding federal or state tax liens, garnishments or insolvency
and bankruptcy proceedings, pending or, to the best of the Seller's and/or such
Single Purpose Entity's knowledge and belief, threatened:
x. against or affecting such Single Purpose Entity, which, if adversely
resolved to such Single Purpose Entity, would materially adversely
affect the ability of such Single Purpose Entity to perform any of its
obligations under any of the Seller Documents, Lease Documents or
Future Financing Documents to which it is a party;
y. against or affecting the portion of the Property that is owned or
leased by such Single Purpose Entity and/or the ownership,
construction, development, maintenance, management, repair, use,
occupancy, possession or operation thereof; or
z. which may involve or affect the validity, priority and/or
enforceability of any of the Seller Documents, any of the Lease
Documents or any of the Future
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Financing Documents to which such Single Purpose Entity is a party, at
law or in equity, or before or by any arbitrator or Governmental
Authority.
6.6 Filing of Tax Returns. The Seller has filed all federal, state and
local tax returns, reports and estimates for all years and periods (and portions
thereof) which are required to be filed as to which extensions are not currently
in effect and has paid all taxes, assessments, impositions, fees and other
governmental charges (including interest and penalties) which have become due
pursuant to such returns, reports or estimates or pursuant to any assessment or
notice of tax claim or deficiency received by the Seller. No tax liability has
been asserted against the Seller by the Internal Revenue Service or any other
federal, state or local taxing authority for taxes, assessments, impositions,
fees or other governmental charges (including interest or penalties thereon) in
excess of those already paid. The provisions for taxes shown on the Seller's
most recent financial statements are adequate to cover the aggregate liability
of such entity to the date thereof for all taxes based on the income, purchases,
sales, business, properties or assets of the Seller. No waivers by the Seller of
the statute of limitations with respect to federal, foreign, state or local
taxes are in effect. The federal income tax returns of the Seller have never
been audited by the Internal Revenue Service. The Seller has withheld proper and
accurate amounts from its employees in full and complete compliance with the tax
withholding provisions of the Internal Revenue Code and other applicable
federal, foreign, state or local laws, and has filed proper and accurate,
federal, foreign, state and local tax returns and reports for all years and
periods (and portions thereof) for which any such returns and reports were due
with respect to employee income tax withholding and social security and
unemployment taxes. All payments due from the Seller on account of employee
income tax withholding or social security and unemployment taxes in respect of
years and periods (and portions thereof) ended on or prior to the date of such
equity's most recent financial statement were paid prior to the date thereof or
accrued as a liability on such financial statement.
As of the applicable Closing Date involving the acquisition of all of the
equity interests in any Single Purpose Entity by the Buyer pursuant to this
Agreement, (a) such Single Purpose Entity shall have filed all federal, state
and local tax returns, reports and estimates for all years and periods (and
portions thereof) which are required to be filed and shall have paid all taxes,
assessments, impositions, fees and other governmental charges (including
interest and penalties) which have become due pursuant to such returns, reports
or estimates or pursuant to any assessment or notice of tax claim or deficiency
received by such Single Purpose Entity, (b) no tax liability shall have been
asserted against the applicable Single Purpose Entity by the Internal Revenue
Service or any other federal, state or local taxing authority for taxes,
assessments, impositions, fees or other governmental charges (including interest
or penalties thereon) in excess of those already paid and (c) no waivers by such
Single Purpose Entity of the statute of limitations with respect to federal,
foreign, state or local taxes are in effect.
6.7 Accuracy of Financial Statements and Other Information. The
financial statements
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of the various members of the Selling Group and of the Property (or any portion
thereof) identified on SCHEDULE 6.7 attached hereto or hereafter given to the
Buyer in connection with the consummation of the transactions contemplated
hereunder were or shall be true, complete and accurate, in all material
respects, and fairly presented or shall fairly present the financial condition
of each member of the Selling Group as of the date thereof and for the periods
covered thereby.
Neither this Agreement, nor any of the other Seller Documents nor any
certificate, agreement, statement or other document, including, without
limitation, any financial statements concerning the financial condition of any
member of the Selling Group, furnished to or to be furnished to the Buyer or its
attorneys in connection with this Agreement, contains or will contain any untrue
statement of a material fact or omits or will omit to state a material fact
necessary in order to prevent all statements contained herein and therein from
being misleading in any material respect. There is no fact within the special
knowledge of the Seller which has not been disclosed herein or in writing to the
Buyer that materially adversely affects, or in the future, insofar as the Seller
can reasonably foresee, may materially adversely affect the business,
properties, assets or condition, financial or otherwise, of any member of the
Selling Group or the Property (or any portion thereof).
6.8 Pending Actions, Notices and Reports. Tere is no action or
investigation pending or, to the best knowledge and belief of the Seller,
threatened, anticipated or contemplated (nor, to the knowledge of the Seller, is
there any reasonable basis therefor) against or affecting the Property (or any
portion thereof) or any member of the Selling Group before any Governmental
Authority which could prevent or hinder the consummation of the transactions
contemplated hereby or call into question the validity of this Agreement or any
of the other Seller Documents or any action taken or to be taken in connection
with the transactions contemplated hereunder or which in any single case or in
the aggregate might result in any material adverse change in the business,
prospects, condition, affairs or operations of any member of the Selling Group
or any portion of the Property (including, without limitation, any action to
revoke, withdraw or suspend any Permit necessary or desirable for the operation
of any portion of the Property in accordance with its Primary Intended Use and
any action to transfer or relocate any such Permit to a location other than the
Property) or any material impairment of the right or ability of any member of
the Selling Group to carry on its operations as presently conducted or proposed
to be conducted under the terms hereof.
None of the Facilities nor any member of the Selling Group has received any
notice of any claim, requirement or demand of any Governmental Authority or any
other Person having or claiming any licensing, certifying, supervising,
evaluating or accrediting authority over the Approved Property to rework or
redesign any of the Existing Project Plans, the Approved Property (or any
portion thereof) or the professional staff, the professional services,
procedures or practices of the Approved Property (or any portion thereof) in any
material respect or to provide additional furniture, fixtures, equipment or
inventory or to otherwise take
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any action so as to make the Approved Property conform to or comply with any
Legal Requirement.
As of the applicable Closing Date involving the Blue ▇▇▇▇ Facility, the
Richmond Facility, the ▇▇▇▇▇▇▇▇▇▇ Facility or the West Bloomfield Hills
Facility, neither the applicable Facility nor any member of the Selling Group
shall have received any notice of any claim, requirement or demand of any
Governmental Authority or any other Person having or claiming any licensing,
certifying, supervising, evaluating or accrediting authority over any such
Facility to rework or redesign any of the Project Plans relating thereto, any
portion of the Property relating thereto or the professional staff, the
professional services, procedures or practices of any such Facility in any
material respect or to provide additional furniture, fixtures, equipment or
inventory or to otherwise take any action so as to make such Facility (and/or
the applicable portion of the Property relating thereto) conform to or comply
with any Legal Requirement.
6.9 Compliance with Legal and Other Requirements. Subject to Section
8.33 hereof, the Selling Group and the Property and the ownership, construction,
development, maintenance, management, repair, use, occupancy, possession and
operation thereof comply with all applicable Legal Requirements, Permitted
Encumbrances, Permits and Contracts and there is no claim of any violation
thereof known to the Seller. Without limiting the foregoing, upon the completion
of the construction of each Development Project and prior to the commencement of
the operation thereof, the Seller or any applicable Single Purpose Entity shall
obtain all Permits (including, without limitation, all Operating Permits) that
are necessary to operate such Development Project in accordance with its Primary
Intended Use.
There are no outstanding notices of deficiencies or work orders relating to
the Property (or any portion thereof) issued by any Governmental Authority
requiring conformity to any of the Legal Requirements. The Seller has been
issued all Permits (including, without limitation, COs and Operating Permits)
required to operate the Naples Facility and the Carmel Facility in accordance
with their respective Primary Intended Uses, other than a CO relating to the
Carmel Facility. As of any Closing Date involving any Facility leased or owned
by the Seller, the Seller shall have been issued all Permits (including, without
limitation, all Operating Permits) required to operate such Facility in
accordance with its Primary Intended Use. As of the applicable Closing Date
involving the acquisition of all of the equity interests in any Single Purpose
Entity by the Buyer pursuant to this Agreement, such Single Purpose Entity shall
have been issued all Permits (including, without limitation, all Operating
Permits) required to operate the Facility that it leases or owns in accordance
with such Facility's Primary Intended Use. The Seller knows of no impediments to
the Seller (or, if applicable, the Single Purpose Entities) and the Development
Projects obtaining all necessary Permits (including, without limitation,
Operating Permits) from appropriate Governmental Authorities with jurisdiction
over the operation of the Development Projects, so that the Development Projects
may be operated in accordance with their respective Primary Intended Uses.
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6.10 Property Matters. Subject to Section 8.20 and the Buyer's
approval of the Blue ▇▇▇▇ Permitted Encumbrances and the Richmond Permitted
Encumbrances, the ▇▇▇▇▇▇▇▇▇▇ Permitted Encumbrances and the West Bloomfield
Hills Permitted Encumbrances, the Property is free and clear of all Liens and
Leases, except the Permitted Encumbrances. None of the Permitted Encumbrances
has or is likely to have a material adverse impact upon, nor interfere with or
impede, in any material respect, the operation of the Property in accordance
with its Primary Intended Use.
There is no Condemnation or similar proceeding pending with respect to or
affecting any portion of the Property and the Seller is not aware, to the best
of the Seller's knowledge and belief, that any such proceeding is contemplated.
No part of the Property has been damaged by any Casualty. The Naples Facility
and the Carmel Facility will be maintained in good operating condition and
repair, ordinary wear and tear excepted (but, damage from any Casualty expressly
not excepted), free from known defects in construction or design. Upon the
completion of the construction of the Development Projects in accordance with
the Project Plans, the terms hereof and the terms of the Development Agreements,
the Development Projects will be maintained in good operating condition and
repair, ordinary wear and tear excepted (but, damage from any Casualty expressly
not excepted), free from known defects in construction or design.
All buildings and other improvements necessary, both legally and
practically, for the operation of the Naples Facility are located upon the Real
Property demised under the Naples Lease. The Naples Property constitutes all
real and personal property required, both legally and practically, for the
operation of the Naples Facility as contemplated by the terms of this Agreement
and the Naples Lease Documents. All buildings and other improvements necessary,
both legally and practically, for the operation of the Carmel Facility are
located upon the Real Property demised under the Carmel Lease. The Carmel
Property constitutes all real and personal property required, both legally and
practically, for the operation of the Carmel Facility as contemplated by the
terms of this Agreement and the Carmel Lease Documents. Upon the completion of
construction of each Development Project in accordance with the Project Plans,
the terms of this Agreement and the terms of the Development Agreements, (a) all
buildings and other improvements necessary, both legally and practically, for
the operation of such Development Project shall be located upon the portion of
the Real Property relating thereto and (b) the portion of the Property relating
to such Development Project shall constitute all real and personal property
required, both legally and practically, for the operation of the applicable
Development Project as contemplated by the terms of this Agreement and the
applicable Lease Documents or Future Financing Documents.
As of the date hereof, the Seller (i) has good, marketable and, subject to
the terms of the Existing Leases, indefeasible leasehold title to all of the
Real Property, excluding the Blue ▇▇▇▇ Real Property, the Richmond Real
Property, the ▇▇▇▇▇▇▇▇▇▇ Real Property and the West Bloomfield Hills Real
Property, free and clear of all Liens other than the Permitted
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Encumbrances relating thereto, (ii) has the right to acquire good, marketable
and indefeasible title to the Blue ▇▇▇▇ Real Property in accordance with the
terms of the Blue ▇▇▇▇ Purchase Agreement, free and clear of all Liens other
than the Permitted Encumbrances relating thereto, (iii) has the right to acquire
good, marketable and indefeasible title to the Richmond Real Property in
accordance with the terms of the Richmond Purchase Agreement, free and clear of
all Liens other than the Permitted Encumbrances relating thereto, (iv) has the
right to acquire good, marketable and indefeasible title to the ▇▇▇▇▇▇▇▇▇▇ Real
Property in accordance with the terms of the ▇▇▇▇▇▇▇▇▇▇ Purchase Agreement, free
and clear of all Liens other than the Permitted Encumbrances relating thereto
and (v) has the right to acquire good, marketable and indefeasible title to the
West Bloomfield Hills Real Property in accordance with the terms of the West
Bloomfield Hills Purchase Agreement, free and clear of all Liens other than the
Permitted Encumbrances relating thereto.
As of the applicable Closing Date involving the acquisition of all of the
equity interests in any Single Purpose Entity by the Buyer pursuant to this
Agreement, such Single Purpose Entity shall have good, marketable and
indefeasible (x) fee title to any portion of the Real Property owned by such
Single Purpose Entity or (y) subject to the terms of any applicable Facility
Lease, leasehold title to the Real Property demised to the Single Purpose Entity
under the Facility Lease to which such Single Purpose Entity is a party, in
either case, free and clear of all Liens other than the Permitted Encumbrances
relating thereto. As of any Closing Date involving any Real Property owned by
the Seller, the Seller shall have good, marketable and indefeasible fee title to
such portion of the Real Property, free and clear of all Liens other than the
Permitted Encumbrances relating thereto. As of any Closing Date involving any
Facility demised to the Seller pursuant to any Facility Lease, the Seller shall
have good, marketable and, subject to the terms of any such Facility Lease,
indefeasible leasehold title to the Real Property which is the subject of such
Facility Lease, free and clear of all Liens other than the Permitted
Encumbrances relating thereto.
The Real Property abuts on and has direct vehicular access to a public road
or has access to a public road via permanent, irrevocable, appurtenant
easements. All of the Real Property other than the Blue ▇▇▇▇ Real Property
constitutes separate parcels for real estate tax purposes and other than the
parcel of land that currently includes the Blue ▇▇▇▇ Real Property, no portion
of any real property that does not constitute a portion of the Real Property is
part of the same tax parcel as any part of the Property. As of the Blue ▇▇▇▇
Closing, no portion of any real property that does not constitute the Blue ▇▇▇▇
Real Property shall be part of the same tax parcel as the Blue ▇▇▇▇ Real
Property.
All utilities necessary for the use and operation of the Existing
Facilities are available to the Existing Facilities: (A) in sufficient supply
and capacity; (B) through validly created and existing easements of record
appurtenant to or encumbering the portion of the Real Property upon which the
Existing Facilities are located (which easements shall not impede or restrict
the operation of the Existing Facilities); and (C) without need for any Permits
and Contracts required to be issued by or entered into with any Governmental
Authority, except as
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already obtained or executed, as the case may be, or as otherwise shown, to the
satisfaction of the Buyer, to be readily obtainable. Prior to the completion of
any Development Project, all utilities necessary for the use and operation of
such Development Project shall be available to such Development Project: (I) in
sufficient supply and capacity; (II) through validly created and existing
easements of record appurtenant to or encumbering the portion of the Real
Property upon which such Development Project is located (which easements shall
not impede or restrict the construction and operation of the applicable
Development Project in accordance with the applicable Project Plans, the terms
of this Agreement and the terms of the applicable Development Agreement); and
(III) without need for any Permits and Contracts required to be issued by or
entered into with any Governmental Authority, except as already obtained or
executed, as the case may be, or as otherwise shown, to the satisfaction of the
Buyer, to be readily obtainable.
6.11 Hazardous Substances. Without limiting the generality of any of
the other representations and warranties set forth in this Section 6, (a) except
as may have been specifically disclosed in any of the Environmental Reports, no
Hazardous Substances have been or are being generated, stored, released or
disposed of on, in, under or from the Property by any member of the Selling
Group nor, to the best of the Seller's knowledge, by any other Person, (b) the
Property is in compliance with all Applicable Environmental Laws, (c) there are
no Environmental Claims pending or threatened against any member of the Selling
Group or any Person whose liability for any Environmental Claim any member of
the Selling Group has or may have retained or assumed either contractually or by
operation of law, nor have there ever been any Environmental Claims pending or
threatened against the Seller with respect to the Property, (d) no member of the
Selling Group has incurred any liability to any of the States or the United
States of America on account of Hazardous Substances on, in, under or affecting
the Property, (e) except as may have been specifically disclosed in any of the
Environmental Reports, the Seller is not aware of the existence, release or
threat of release of any Hazardous Substances on any property adjacent to the
Property that could affect any portion of the Property, (f) no portion of the
Property has been designated by any Governmental Authority as a hazardous waste
disposal site or a site or location requiring investigation concerning, or
management, clean-up or removal of, any Hazardous Substances and (g) except as
may have been specifically disclosed in any of the Environmental Reports, no
underground storage tanks currently exist under the Property.
6.12 Labor Matters. There are no proceedings now pending, nor, to the
best of the Seller's knowledge, threatened with respect to the operation of any
Existing Facility before the National Labor Relations Board, State Commission on
Human Rights and Opportunities, State Department of Labor, U.S. Department of
Labor or any other Governmental Authority having jurisdiction of employee rights
with respect to hiring, tenure and conditions of employment, and the Seller has
not experienced any material controversy with any administrator of any Existing
Facility or other
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employee of similar stature or with any labor organization. There are no
collective bargaining agreements now or previously in effect relating to any
Existing Facility and no Existing Facility is or has been affected by any actual
or threatened strike, work stoppage or other labor disturbance. To the best
knowledge of the Seller, as of the date hereof, no union has attempted or is in
the midst of attempting to represent any employee of any Existing Facility as a
collective bargaining unit.
As of the applicable Closing Date involving the acquisition of all of the
equity interests in any Single Purpose Entity by the Buyer pursuant to this
Agreement, (a) there shall be no proceedings then pending, nor, to the best of
the Seller's knowledge, threatened with respect to the operation of Facility
operated by such Single Purpose Entity before the National Labor Relations
Board, State Commission on Human Rights and Opportunities, State Department of
Labor, U.S. Department of Labor or any other Governmental Authority having
jurisdiction of employee rights with respect to hiring, tenure and conditions of
employment, and such Single Purpose Entity shall not have experienced any
material controversy with any Facility administrator or other employee of
similar stature or with any labor organization, (b) there shall be no collective
bargaining agreements then or previously in effect relating to the Facility
operated by such Single Purpose Entity and such Facility shall not then be
affected (nor shall have such Facility been affected in the past) by any actual
or threatened strike, work stoppage or other labor disturbance and (c) to the
best knowledge of the Seller, no union shall have attempted or shall be in the
midst of attempting to represent any employee of the applicable Facility as a
collective bargaining unit.
As of the applicable Closing Date involving any Facility leased or owned by
the Seller, (i) there shall be no proceedings then pending, nor, to the best of
the Seller's knowledge, threatened with respect to the operation of such
Facility before the National Labor Relations Board, State Commission on Human
Rights and Opportunities, State Department of Labor, U.S. Department of Labor or
any other Governmental Authority having jurisdiction of employee rights with
respect to hiring, tenure and conditions of employment, and the Seller shall not
have experienced any material controversy with any Facility administrator or
other employee of similar stature or with any labor organization, (ii) there
shall be no collective bargaining agreements then or previously in effect
relating to the Facility owned or leased by the Seller and such Facility shall
not then be affected (nor shall have such Facility been affected in the past) by
any actual or threatened strike, work stoppage or other labor disturbance and
(iii) to the best knowledge of the Seller, no union shall have attempted or
shall be in the midst of attempting to represent any employee of the applicable
Facility as a collective bargaining unit.
6.13 Intellectual Property. No claim of infringement has been asserted
against the Seller regarding it use of the tradename "Windsor Court". To the
best of the Seller's knowledge, the Seller is duly licensed or authorized to use
all other (if any) Intellectual Property which is used in or necessary for the
construction, development, management and/or operation of the Existing
Facilities in accordance with their
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respective Primary Intended Uses, without conflict with or infringement of any,
and subject to no, Lien (other than any Lien created by any of the Lease
Documents), right, title or interest in others.
6.14 Management Agreements. As of the applicable Closing Date
involving any Facility, (a) there shall be no Management Agreement in force and
effect relating to such Facility and (b) if such Facility is owned or leased by
a Single Purpose Entity, such Single Purpose Entity shall not have any
outstanding obligation, debt or other liability of any kind whatsoever (at law
or in equity) to any Person that was previously a Manager of the Facility.
6.15 Omnibus Letter Agreement, the Richmond Architect's Agreement, the
West Bloomfield Hills Architect's Agreement and Existing Construction Contracts.
The Omnibus Letter Agreement, the Richmond Architect's Agreement, the West
Bloomfield Hills Architect's Agreement and the Existing Construction Contracts
have been validly executed by and are binding upon the parties thereto and each
is in full force and effect in accordance with the terms thereof. Although the
Omnibus Letter Agreement states on its face that Liberty Health Care (an
Affiliate of the Seller) is a party to the Omnibus Letter Agreement, in
actuality, the Seller has performed all of the obligations of Liberty Health
Care thereunder and has succeeded to the interest of Liberty Health Care
thereunder. All of the parties to the Existing Construction Contracts, the
Richmond Architect's Agreement, the West Bloomfield Hills Architect's Agreement
and the Omnibus Letter Agreement have faithfully performed, in all material
respects, all of their respective obligations thereunder to the extent accrued
as of the date hereof, and none of the parties to the foregoing instruments has
asserted any claim of default thereunder; except that the Seller has asserted
that the Architect relating to the Birmingham Facility did not faithfully
perform all of its obligations under the Omnibus Letter Agreement with regard to
the Birmingham Facility; however, such alleged default pertains to the initial
drawings prepared by such Architect for the Birmingham Facility and does not in
any way relate to any of the Project Plans.
6.16 Future Architect's Agreements and Future Construction Contracts.
As of the Closing Date involving the Blue ▇▇▇▇ Property, (a) the Blue ▇▇▇▇
Architect's Agreement and the Blue ▇▇▇▇ Construction Contract shall have been
validly executed by and shall be binding upon the parties thereto and each shall
be in full force and effect in accordance with the terms thereof and (b) all of
the parties to the Blue ▇▇▇▇ Construction Contract and the Blue ▇▇▇▇ Architect's
Agreement shall have faithfully performed, in all material respects, all of
their respective obligations thereunder and none of the parties to the foregoing
instruments shall have asserted any claim of default thereunder. As of the
Closing Date involving the Richmond Property, (i) the Richmond Construction
Contract shall have been validly executed by and shall be binding upon the
parties thereto and each shall be in full force and effect in
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accordance with the terms thereof and (ii) all of the parties to the Richmond
Construction Contract and the Richmond Architect's Agreement shall have
faithfully performed, in all material respects, all of their respective
obligations thereunder and none of the parties to the foregoing instruments
shall have asserted any claim of default thereunder. As of the Closing Date
involving the West Bloomfield Hills Property, (x) the West Bloomfield Hills
Architect's Agreement and the West Bloomfield Hills Construction Contract shall
have been validly executed by and shall be binding upon the parties thereto and
each shall be in full force and effect in accordance with the terms thereof and
(y) all of the parties to the West Bloomfield Hills Construction Contract and
the West Bloomfield Hills Architect's Agreement shall have faithfully performed,
in all material respects, all of their respective obligations thereunder and
none of the parties to the foregoing instruments shall have asserted any claim
of default thereunder. As of the Closing Date involving the ▇▇▇▇▇▇▇▇▇▇ Property,
(A) the ▇▇▇▇▇▇▇▇▇▇ Architect's Agreement and the ▇▇▇▇▇▇▇▇▇▇ Construction
Contract shall have been validly executed by and shall be binding upon the
parties thereto and each shall be in full force and effect in accordance with
the terms thereof and (B) all of the parties to the ▇▇▇▇▇▇▇▇▇▇ Construction
Contract and the ▇▇▇▇▇▇▇▇▇▇ Architect's Agreement shall have faithfully
performed, in all material respects, all of their respective obligations
thereunder and none of the parties to the foregoing instruments shall have
asserted any claim of default thereunder.
6.17 Existing Project Plans. The Seller has delivered to the Buyer
true and correct copies of the Existing Project Plans. The Existing Project
Plans have been filed with and approved by all appropriate Governmental
Authorities. All necessary Permits relating to the Existing Project Plans
required to be issued or granted by any applicable Governmental Authority having
or claiming jurisdiction over the Property have been obtained and all such
Permits are in full force and effect, are not subject to any unexpired appeal
periods or any appeals or challenges which have not been fully resolved in favor
of the Seller, and do not contain any conditions or terms relating to any
portion of the Property which have not been fully satisfied or which will not be
fully satisfied by the completion of the construction of the applicable
Development Projects (substantially and in all material respects in accordance
with the Existing Project Plans and the terms and provisions of this Agreement
and the applicable Development Agreements). Furthermore, the Existing Project
Plans have been approved in writing by the Landlords (to the extent required
under the Development Agreements), any construction heretofore performed on any
Development Project has been performed substantially and in all material
respects in accordance with the Existing Project Plans and the applicable
Development Agreements and all future construction on the applicable Development
Projects shall be performed substantially and in all material respects in
accordance with the Existing Project Plans and the terms and conditions of this
Agreement and the applicable Development Agreements. There are no structural
defects in any of the Existing Facilities or the Development Projects of which
the Seller has been advised or of which the Seller has notice or knowledge. The
Seller has not received any notice claiming that, and the Seller has no
knowledge that, the Existing Project Plans violate any Legal Requirement.
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6.18 Plans and Specifications Relating to the Blue ▇▇▇▇ Property.
Prior to the commencement of the construction of the Blue ▇▇▇▇ Development
Project and as of the Blue ▇▇▇▇ Closing Date, (a) the Seller shall have
delivered to the Buyer true and correct copies of the Blue ▇▇▇▇ Plans and
Specifications, (b) the Blue ▇▇▇▇ Plans and Specifications shall have been filed
with and approved by all appropriate Governmental Authorities, (c) all necessary
Permits relating to the Blue ▇▇▇▇ Plans and Specifications required to be issued
or granted by any applicable Governmental Authority having or claiming
jurisdiction over the Blue ▇▇▇▇ Property shall have been obtained and all such
Permits shall be in full force and effect, shall not be subject to any unexpired
appeal periods or any appeals or challenges which have not been fully resolved
in favor of the Seller, and shall not contain any conditions or terms relating
to the Blue ▇▇▇▇ Property which have not been fully satisfied or which will not
be fully satisfied by the completion of the construction of the Blue ▇▇▇▇
Development Project (substantially and in all material respects in accordance
with the Blue ▇▇▇▇ Plans and Specifications and the terms and provisions of this
Agreement and the Blue ▇▇▇▇ Development Agreement), (d) the Blue ▇▇▇▇ Plans and
Specifications shall have been approved in writing by the Buyer and, to the
extent required under any applicable Future Financing Documents, any Future
Lender and (e) all construction on the Blue ▇▇▇▇ Development Project shall be or
shall have been performed substantially and in all material respects in
accordance with the Blue ▇▇▇▇ Plans and Specifications and the terms and
conditions of this Agreement and the Blue ▇▇▇▇ Development Agreement.
6.19 Plans and Specifications Relating to the Richmond Property. Prior
to the commencement of the construction of the Richmond Development Project and
as of the Richmond Closing Date, (a) the Seller shall have delivered to the
Buyer true and correct copies of the Richmond Plans and Specifications, (b) the
Richmond Plans and Specifications have been filed with and approved by all
appropriate Governmental Authorities, (c) all necessary Permits relating to the
Richmond Plans and Specifications required to be issued or granted by any
applicable Governmental Authority having or claiming jurisdiction over the
Richmond Property shall have been obtained and all such Permits shall be in full
force and effect, shall not be subject to any unexpired appeal periods or any
appeals or challenges which have not been fully resolved in favor of the Seller,
and shall not contain any conditions or terms relating to the Richmond Property
which have not been fully satisfied or which will not be fully satisfied by the
completion of the construction of the Richmond Development Project
(substantially and in all material respects in accordance with the Richmond
Plans and Specifications and the terms and provisions of this Agreement and the
Richmond Development Agreement), (d) the Richmond Plans and Specifications shall
have been approved in writing by the Buyer and, to the extent required under any
applicable Future Financing Documents, any Future Lender and (e) all
construction on the Richmond Development Project shall be or shall have been
performed substantially and in all material respects in accordance with the
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Richmond Plans and Specifications and the terms and conditions of this Agreement
and the Richmond Development Agreement.
6.20 Plans and Specifications Relating to the West Bloomfield Hills
Property. Prior to the commencement of the construction of the West Bloomfield
Hills Development Project, (a) the Seller shall have delivered to the Buyer true
and correct copies of the West Bloomfield Hills Plans and Specifications, (b)
the West Bloomfield Hills Plans and Specifications shall have been filed with
and approved by all appropriate Governmental Authorities, (c) all necessary
Permits relating to the West Bloomfield Hills Project Plans required to be
issued or granted by any applicable Governmental Authority having or claiming
jurisdiction over the West Bloomfield Hills Property shall have been obtained
and all such Permits shall be in full force and effect, shall not be subject to
any unexpired appeal periods or any appeals or challenges which have not been
fully resolved in favor of the Seller, and shall not contain any conditions or
terms relating to the West Bloomfield Hills Property which have not been fully
satisfied or which will not be fully satisfied by the completion of the
construction of the West Bloomfield Hills Development Project (substantially and
in all material respects in accordance with the West Bloomfield Hills Project
Plans and the terms and provisions of this Agreement and the West Bloomfield
Hills Development Agreement), (d) the West Bloomfield Hills Plans and
Specifications shall have been approved in writing by the Buyer and any
applicable Landlord or Future Lender and (e) all future construction on the West
Bloomfield Hills Development Project shall be performed substantially and in all
material respects in accordance with the West Bloomfield Hills Plans and
Specifications and the terms and conditions of this Agreement and the West
Bloomfield Hills Development Agreement.
6.21 Plans and Specifications Relating to the ▇▇▇▇▇▇▇▇▇▇ Property.
Prior to the commencement of the construction of the ▇▇▇▇▇▇▇▇▇▇ Development
Project, (a) the Seller shall have delivered to the Buyer true and correct
copies of the ▇▇▇▇▇▇▇▇▇▇ Plans and Specifications, (b) the ▇▇▇▇▇▇▇▇▇▇ Plans and
Specifications have been filed with and approved by all appropriate Governmental
Authorities, (c) all necessary Permits relating to the ▇▇▇▇▇▇▇▇▇▇ Project Plans
required to be issued or granted by any applicable Governmental Authority having
or claiming jurisdiction over the ▇▇▇▇▇▇▇▇▇▇ Property shall have been obtained
and all such Permits shall be in full force and effect, shall not be subject to
any unexpired appeal periods or any appeals or challenges which have not been
fully resolved in favor of the Seller, and shall not contain any conditions or
terms relating to the ▇▇▇▇▇▇▇▇▇▇ Property which have not been fully satisfied or
which will not be fully satisfied by the completion of the construction of the
▇▇▇▇▇▇▇▇▇▇ Development Project (substantially and in all material respects, in
accordance with the ▇▇▇▇▇▇▇▇▇▇ Plans and Specifications and the terms and
provisions of this Agreement and the ▇▇▇▇▇▇▇▇▇▇ Development Agreement), (d) the
▇▇▇▇▇▇▇▇▇▇ Plans and Specifications shall have been approved in writing by the
Buyer
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and any applicable Landlord or Future Lender and (e) all future construction on
the ▇▇▇▇▇▇▇▇▇▇ Development Project shall be performed substantially and in all
material respects in accordance with the ▇▇▇▇▇▇▇▇▇▇ Plans and Specifications and
the terms and conditions of this Agreement and the ▇▇▇▇▇▇▇▇▇▇ Development
Agreement.
6.22 Prior Construction Work. Except as may be expressly permitted by
any Construction Contract, no Person has performed any construction work or
furnished any services in connection with any construction carried on or to be
carried on at either of the Existing Facilities who or which remains unpaid at
the time of execution of this Agreement other than the General Contractor under
the Carmel Construction Contract (who claims to be owed certain sums under the
Carmel Construction Contract) or who or which shall remain unpaid after the next
advance of funds is made under the Development Agreements relating to those
Development Projects that are currently under construction. As of the applicable
Closing Date involving the acquisition of all of the equity interests in any
Single Purpose Entity by the Buyer pursuant to this Agreement, no Person who has
performed any construction work or furnished any services in connection with any
construction carried on at the Facility operated by such Single Purpose Entity
shall remain unpaid. As of the applicable Closing Date involving any Facility
leased or owned by the Seller, no Person who has performed any construction work
or furnished any services in connection with any construction carried on at such
Facility shall remain unpaid.
6.23 Suitability of the Existing Project Plans. The Existing Project
Plans provide for the construction and renovation of all buildings and related
improvements necessary, both legally and practically, for the construction of
the Development Projects (other than the Development Projects relating to the
Blue ▇▇▇▇ Property, the Richmond Property, the ▇▇▇▇▇▇▇▇▇▇ Property and the West
Bloomfield Hills Property) substantially and in all material respects in
accordance with the terms of this Agreement and the Development Agreements
relating thereto and, after the completion of the construction thereof, for the
operation of such Development Projects for their respective Primary Intended
Uses.
6.24 Suitability of the Plans and Specifications Relating to the Blue
▇▇▇▇ Development Project. As of date of the commencement of the construction of
the Blue ▇▇▇▇ Development Project, the Blue ▇▇▇▇ Plans and Specifications shall
provide for the construction and renovation of all buildings and related
improvements necessary, both legally and practically, for the construction of
the Blue ▇▇▇▇ Development Project substantially and in all material respects in
accordance with the terms of this Agreement and the Blue ▇▇▇▇ Development
Agreement and, after the completion of the construction thereof, for the
operation of the Blue ▇▇▇▇ Development Project for its Primary Intended Uses.
6.25 Suitability of the Plans and Specifications Relating to the
Richmond Development Project. As of date of the commencement of the construction
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of the Richmond Development Project, the Richmond Plans and Specifications shall
provide for the construction and renovation of all buildings and related
improvements necessary, both legally and practically, for the construction of
the Richmond Development Project substantially and in all material respects in
accordance with the terms of this Agreement and the Richmond Development
Agreement and, after the completion of the construction thereof, for the
operation of the Richmond Development Project for its Primary Intended Uses.
6.26 Suitability of Project Plans Relating to the West Bloomfield
Hills Development Project. As of date of the commencement of the construction
of the West Bloomfield Hills Development Project, the West Bloomfield Hills
Plans and Specifications shall provide for the construction and renovation of
all buildings and related improvements necessary, both legally and practically,
for the construction of the West Bloomfield Hills Development Project
substantially and in all material respects in accordance with the terms of this
Agreement and the West Bloomfield Hills Development Agreement and, after the
completion of the construction thereof, for the operation of the West Bloomfield
Hills Development Project for its Primary Intended Uses.
6.27 Suitability of Project Plans Relating to the ▇▇▇▇▇▇▇▇▇▇
Development Project. As of date of the commencement of the construction of the
▇▇▇▇▇▇▇▇▇▇ Development Project, the ▇▇▇▇▇▇▇▇▇▇ Project Plans and Specifications
shall provide for the construction and renovation of all buildings and related
improvements necessary, both legally and practically, for the construction of
the ▇▇▇▇▇▇▇▇▇▇ Development Project substantially and in all material respects in
accordance with the terms of this Agreement and the ▇▇▇▇▇▇▇▇▇▇ Development
Agreement and, after the completion of the construction thereof, for the
operation of the ▇▇▇▇▇▇▇▇▇▇ Development Project for its Primary Intended Uses.
6.28 Compliance with Legal Requirements and Applicable Agreements.
Subject to Section 8.33 hereof, the Existing Facilities are in compliance with
(a) all Legal Requirements; (b) all applicable Permits and Contracts and (c) all
applicable by-laws, codes, rules, regulations and restrictions of the Board of
Fire Underwriters or other insurance underwriters or similar bodies. A CO has
been issued for the Naples Facility and a true and correct copy thereof has been
delivered to the Buyer. Subject to Section 8.33 hereof, upon the completion of
construction of each Development Project, which shall be constructed
substantially and in all material respects in accordance with the Project Plans
relating thereto and the terms and provisions of this Agreement and the
Development Agreement relating thereto, such Development Project shall be in
compliance with (i) all Legal Requirements, (ii) all applicable Permits and
Contracts and (iii) all applicable by-laws, codes, rules, regulations and
restrictions of the Board of Fire Underwriters or other insurance underwriters
or similar bodies.
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6.29 Permits and Contracts. All Permits and Contracts that are
required by any Governmental Authority or quasi-governmental authority or agency
or are necessary for, or in connection with, the construction of the Development
Projects (collectively, the "Construction Permits and Contracts"), other than
the Construction Permits and Contracts relating to the Blue ▇▇▇▇ Facility, the
Richmond Facility, the West Bloomfield Hills Facility or the ▇▇▇▇▇▇▇▇▇▇
Facility, are listed on EXHIBIT F attached hereto. All Construction Permits and
Contracts that can be obtained in the ordinary course of the construction of the
Development Projects completed as of the date hereof (collectively, the
"Existing Permits and Contracts") have been obtained or executed, as the case
may be and true and complete copies thereof have been delivered to the Buyer.
All such Existing Permits and Contracts are in full force and effect, are not
subject to any unexpired appeal periods or any appeals or challenges which have
not been conclusively resolved in favor of the Seller and do not contain any
conditions or terms which have not been fully satisfied or which will not be
fully satisfied by the completion of the construction of the Development
Projects (if constructed in accordance with the Project Plans and the terms and
provisions of this Agreement and the Development Agreements). There is no action
pending, or, to the best knowledge and belief of the Seller, recommended by the
applicable Governmental Authority having jurisdiction thereof, either to revoke,
repeal, cancel, modify, withdraw or suspend any of the Construction Permits and
Contracts. The Seller knows of no impediment to the future issuance of all
Future Permits and Contracts and has no reason to believe that the Future
Permits and Contracts will not be obtained as and when needed. The Seller will
use diligent efforts to obtain the Future Permits and Contracts when and as
needed or as required by applicable Legal Requirements.
As of the Closing Date relating to any Development Project, (a) all Future
Permits and Contracts relating to such Development Project shall have been
obtained or executed, as the case may be and true and complete copies thereof
shall have been delivered to the Buyer, (b) all such Future Permits and
Contracts shall then be in full force and effect, shall not be subject to any
unexpired appeal periods or any appeals or challenges which have not been
conclusively resolved in favor of the Seller (or any Single Purpose Entity) and
shall not contain any conditions or terms which have not been fully satisfied
and (c) there shall not be any action pending, or, to the best knowledge and
belief of the Seller, recommended by the applicable Governmental Authority
having jurisdiction thereof, either to revoke, repeal, cancel, modify, withdraw
or suspend any of such Future Permits and Contracts.
All of the Permits required under applicable Legal Requirements to be
issued by any Governmental Authorities having jurisdiction over assisted living,
independent living and/or alzheimers facilities (collectively, the "Operating
Permits") that are required for the operation of the Facilities in accordance
with their respective Primary Intended Use are set forth on EXHIBIT K attached
hereto.
6.30 Leases. As of the date hereof, the only Leases in effect are the
Existing Facility Leases, Resident Agreements complying with the provisions of
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Section 8.16 hereof that relate to the Naples Facility and Resident Agreements
complying with the provisions of Section 8.16 hereof that relate to the Carmel
Facility. The Seller has delivered to the Buyer, true and correct copies of the
Existing Facility Leases, together with any and all amendments and modifications
thereto. The Existing Facility Leases are in full force and effect, are valid
and enforceable in accordance with their terms and have not been terminated. As
of the date hereof, the Seller is the holder of all of the lessee's right, title
and interest under each of the Existing Leases and the Seller has not assigned,
hypothecated, pledged or otherwise transferred all or any portion of its
interest under any of the Existing Leases.
The Seller has satisfied all commitments made to induce the Landlords to
enter into the Existing Facility Leases. There exists no Lease Default under any
of the Existing Facility Leases, nor any state of facts which, with the giving
of notice and/or the passage of time, would constitute such a Lease Default or
which has given rise to a current dispute between the Seller and any of the
Landlords. None of the Existing Facility Leases is presently in arbitration or
litigation.
6.31 Default under Lease Documents. No event or state of facts which
constitutes, or which, with notice or lapse of time, or both, could constitute,
a Lease Default has occurred and is continuing.
6.32 Landlord Bankruptcy. The Seller has not received written notice
that, and has no actual knowledge that, any of the Landlords has (a) sought or
consented to the appointment of a receiver or trustee for itself or for any
portion of the Property, (b) filed a petition seeking relief under the
bankruptcy or other similar laws of the United States or any state and/or (c)
made a general assignment for the benefit of creditors.
6.33 Existing Lease Documents. Attached hereto as EXHIBIT D and
incorporated herein by reference is a list of all of the Existing Lease
Documents, as the same may have been amended or modified. Except as set forth on
EXHIBIT D, none of the Existing Lease Documents has been amended or modified.
The Seller has delivered to the Buyer a true and complete copy of each of the
Existing Lease Documents, together with any and all amendments and modifications
thereto. To the best of the Seller's knowledge and belief, (a) NHP is the owner
of the Carmel Real Property, the Dublin Real Property, the Germantown Real
Property and the Naples Real Property and the current holder of the lessor's
interest under the Carmel Lease Documents, the Dublin Lease Documents, the
Germantown Lease Documents and the Naples Lease Documents, (b) NHP has not
assigned, hypothecated, pledged, participated or otherwise transferred all or
any portion of its interest under any of the Carmel Lease Documents, the Dublin
Lease Documents, the Germantown Lease Documents or the Naples Lease Documents,
(c) MLD is the owner of the Hockessin Real Property and the holder of the
lessor's interest under the
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Hockessin Lease Documents, (d) MLD has not assigned, hypothecated, pledged,
participated or otherwise transferred all or any portion of its interest under
any of the Hockessin Lease Documents, (e) HCPI is the owner of the Birmingham
Real Property and the Overland Park Real Property and the holder of the lessor's
interest under the Birmingham Lease Documents and the Overland Park Lease
Documents and (f) HCPI has not assigned, hypothecated, pledged, participated or
otherwise transferred all or any portion of its interest under any of the
Birmingham Lease Documents or the Overland Park Lease Documents. The Buyer is
the current holder of all of the lessee's rights under the Existing Lease
Documents and the Buyer has not assigned, hypothecated, pledged or otherwise
transferred all or any portion of its interest under any of the Existing Lease
Documents.
The Seller has satisfied all of its obligations under the Naples
Development Agreement. The Seller has satisfied all of its obligations under the
Carmel Development Agreement other than (i) obtaining a CO for the Carmel
Facility and (ii) paying the applicable General Contractor any amount that may
be owed to such General Contractor under the Carmel Construction Contract.
As of the date hereof, except as set forth on EXHIBIT N attached hereto and
incorporated herein by reference, neither any Landlord nor any other party as
agent for any Landlord, is currently holding any funds on behalf of the Seller
in escrow in an insurance, tax, tenant improvement, renovation, repair or any
other escrow account (each such account is referred to herein as an "Escrow
Account").
6.34 Existing Letters of Credit. The Seller has delivered to the Buyer
true and correct copies of the Existing Letters of Credit. The Existing Letters
of Credit have been obtained by the Seller and delivered to the Landlords as
security for the Seller's obligations under the Lease Documents. Except as
otherwise set forth on EXHIBIT O attached hereto, no other letters of credit are
required to be delivered by the Seller to any of the Landlords pursuant to the
terms of the Existing Lease Documents. The maximum aggregate amount available to
be drawn under the Existing Letters of Credit is set forth on EXHIBIT O and any
additional requirements to deliver additional Letters of Credit pursuant to the
Existing Lease Documents are described on EXHIBIT O attached hereto.
6.35 Development Proceeds. The maximum total amount that will be
advanced under each of the Development Agreements shall equal the sum of (a) the
lesser of the actual cost of the construction and development of the applicable
Development Project or the amount set forth on the Budget for such Development
Project (excluding any Development Fee set forth on such Budget) plus (b) the
applicable Development Fee.
6.36 Personal Property. As of the Closing Date involving any Facility,
the Seller or, if applicable, the Single Purpose Entity to be
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acquired by the Buyer shall own (or lease pursuant to the applicable Lease
Documents) the Tangible Personal Property relating to such Facility and, except
as set forth in the next sentence, shall own the Intangible Personal Property
relating thereto, in each instance free of all Liens other than those Liens held
by any applicable Landlord or Future Lender under any of the applicable Lease
Documents or the Future Financing Documents. Notwithstanding the foregoing, as
of the Closing Date involving the acquisition by the Buyer of the equity
interests in any Single Purpose Entity, in accordance with the provisions of
Section 8.2 hereof, such Single Purpose Entity shall be licensed by the Seller
to use any applicable trade name or trademark pertaining to the Facility that
such Single Purpose Entity operates.
6.37 Insurance Notices. The Seller has not received any notice from
any insurance carrier concerning any defects or inadequacies in the Property
which, if not corrected, would result in the termination of insurance coverage
or increase the cost thereof.
6.38 Additional Representations Regarding the Naples Property.
a. Zoning and Land Use Matters. All of the zoning requirements
applicable to the construction and use of the Naples Property are set forth in
the Naples Planned Unit Development Approvals. The Naples Facility was
constructed substantially and in all material respects in accordance with the
Naples Plans and Specifications, the Naples Development Agreement and the Naples
Planned Unit Development Approvals. The Naples Planned Unit Development
Approvals are in full force and effect. All of the conditions, restrictions and
other limitations set forth in the Naples Planned Unit Development Approvals
relating to the construction and development of the Naples Facility have been
fully satisfied. The operation of the Naples Property in accordance with its
Primary Intended Use will not violate the Naples Planned Unit Development
Approvals. All appeal periods relating to the granting of the Naples Planned
Unit Development Approvals have expired with no appeals having been filed or all
appeals having been conclusively decided in favor of the owner of the Naples
Real Property. The Naples Planned Unit Development Approvals run with the land.
b. Naples Joint Access Agreement. The Seller has fulfilled the
obligation under that certain Joint Access Agreement dated July 25, 1996,
recorded in O.R. Book 2213, Page 1273 (the "Naples Joint Access Agreement") by
and between NHP and ▇▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ as Trustee u/a dated
May 23, 1989, ▇▇▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇ and ▇▇▇▇▇▇▇ ▇.
▇▇▇▇▇ to complete construction of the driveway referenced therein by August 1,
1997.
c. Naples Lease Documents. The Naples Facility was constructed
substantially and in all material respects in accordance with the Naples Plans
and Specifications and the Naples Development Agreement. The total amount
advanced under the Naples Development Agreement was FIVE MILLION TWO HUNDRED
FIVE
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THOUSAND THREE HUNDRED FORTY-TWO DOLLARS ($5,205,342). No Development Fee was
advanced to the Seller under the Naples Development Agreement. Notwithstanding
the requirement in the Naples Lease Documents that Letters of Credit totalling
$520,534 be provided to NHP as collateral, the Naples Letter of Credit totals
$480,000 and NHP has granted the Seller an extension to provide an additional
Letter of Credit to NHP to satisfy the obligations set forth under the Naples
Lease Documents.
6.39 Additional Representations Regarding the Carmel Property.
a. Zoning and Land Use Matters. The Carmel Facility was constructed
substantially and in all material respects in accordance with the Carmel Plans
and Specifications, the Carmel Development Agreement and the Carmel Use Variance
and all other applicable zoning requirements. The Carmel Use Variance is
evidenced solely by the Carmel Board of Zoning Minutes and no conditions,
restrictions or other limitations are imposed on the Carmel Property pursuant to
Carmel Use Variance other than as may be expressly set forth in the Carmel Board
of Zoning Minutes. The Carmel Use Variance is in full force and effect. The
Seller has provided the Buyer with true and correct copy of the Carmel Board of
Zoning Minutes. No other zoning approvals in addition to the Carmel Use Variance
are required for the construction of the Carmel Facility in accordance with the
Carmel Plans and Specifications and the Carmel Development Agreement or the
operation of the Carmel Facility in accordance with its Primary Intended Use.
All of the conditions, restrictions and other limitations set forth in the
Carmel Use Variance relating to the construction and development of the Carmel
Facility, as well as any other applicable zoning requirements relating to the
construction and development of the Carmel Facility have been fully satisfied.
The operation of the Carmel Property in accordance with its Primary Intended Use
will not violate the Carmel Use Variance or any other applicable zoning
requirement. All appeal periods relating to the granting of the Carmel Use
Variance have expired with no appeals having been filed or all appeals having
been conclusively decided in favor of the owner of the Carmel Real Property. The
Carmel Use Variance runs with the land.
b. Blanket Easement. There are no easements that encumber any portion
of the Carmel Property arising under the Carmel Declaration except (i) as shown
on the Carmel Survey or (ii) as may affect any so-called "open space".
c. Carmel Lease Documents The Carmel Facility was constructed
substantially and in all material respects in accordance with the Carmel Plans
and Specifications and the Carmel Development Agreement. The total amount that
will be advanced under the Carmel Development Agreement is FOUR MILLION FIVE
HUNDRED NINETY-EIGHT THOUSAND NINE HUNDRED SEVENTY-EIGHT DOLLARS ($4,598,978).
No Development Fee was advanced to the Seller under the Carmel Development
Agreement.
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6.40 Additional Representations Regarding the Dublin Property.
a. Zoning and Land Use Matters. The Dublin Real Property is currently
zoned Planned Unit Development District (PUD) with the specific approval being
for the Indian Run PUD. The construction of the Dublin Facility in accordance
with the Dublin Plans and Specifications and the use and operation of the Dublin
Facility in accordance with its Primary Intended Use is permitted under the
approval of the PUD Final Development Plan, dated December 3, 1996, and approved
by the Dublin Planning and Zoning Commission on March 20, 1997. The Dublin
Facility's Primary Intended Use is permitted as a matter of right in such zone,
in accordance with the aforesaid Final Development Plan and Planning and Zoning
Commission approval. No special use permits, conditional use permits, variances
or exceptions, other than the aforesaid approvals already given, are needed in
order to construct the Dublin Facility in accordance with the Dublin Plans and
Specifications or to operate the Dublin Facility in accordance with its Primary
Intended Use.
b. Reciprocal Easements. There are no unpaid expenses, fees or
assessments arising under any of the Dublin Driveway Easement Agreements.
c. Stormwater Drainage Easements. The Seller has obtained all
necessary easements for drainage of surface or other water off the Dublin Real
Property, including without limitation, the drainage of stormwater through drain
lines onto lots 258 and 224 as such lots are shown on the survey entitled
"Boundary and Topographic Survey of 3.464 Acres Part of Reserve D, Indian Run
▇▇▇▇▇▇▇ Section 5," prepared by ▇▇▇▇▇ Surveying, dated February 13, 1997, last
revised April 24, 1997.
d. Dublin Lease Documents. No Development Fee (i) is included in the
Dublin Budget or (ii) will be advanced to the Seller under the Dublin
Development Agreement.
6.41 Additional Representations Regarding the Germantown Property.
a. Zoning and Land Use Matters. The Germantown Zoning Approvals are
evidenced solely by the Germantown Board of Zoning Appeals Minutes, the minutes
of the meetings of the Germantown Planning Commission held on October 1, 1996
and March 4, 1997 and the minutes of the meeting of the Germantown Design Review
Commission held on February 18, 1997 and no conditions, restrictions or other
limitations are imposed on the Germantown Property pursuant to the Germantown
Zoning Approvals other than as may be expressly set forth in the Germantown
Board of Zoning Appeals Minutes, the minutes of the meetings of the Germantown
Planning Commission held on October 1, 1996 and March 4, 1997 and the minutes of
the meeting of the Germantown Design Review Commission held on February 18,
1997. The Germantown Zoning Approvals are in full force and effect. The
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Seller has provided a true and correct copy of the Germantown Zoning Approvals
to the Buyer. No other zoning approvals in addition to the Germantown Zoning
Approvals are required for the construction of the Germantown Facility in
accordance with the Germantown Plans and Specifications, the Germantown
Development Agreement and this Agreement or the operation of the Germantown
Facility in accordance with its Primary Intended Use. Upon the completion of the
construction of the Germantown Facility in accordance with the Germantown Plans
and Specifications, the Germantown Development Agreement and this Agreement, all
of the conditions, restrictions and other limitations set forth in the
Germantown Zoning Approvals relating to the construction and development of the
Germantown Facility, as well as all other applicable zoning requirements
relating to the construction and development of the Germantown Facility shall be
fully satisfied. The operation of the Germantown Facility in accordance with its
Primary Intended Use will not violate the Germantown Zoning Approvals or any
other applicable zoning requirement. All appeal periods relating to the granting
of the Germantown Zoning Approvals have expired with no appeals having been
filed or all appeals having been conclusively decided in favor of the owner of
the Germantown Real Property. The Germantown Zoning Approvals run with the land.
b. Germantown Lease Documents. No Development Fee (i) is included in
the Germantown Budget or (ii) will be advanced to the Seller under the
Germantown Development Agreement.
6.42 Additional Representations Regarding the Birmingham Property.
a. Zoning and Land Use Matters. The Birmingham Conditional Use
Approval is evidenced solely by paragraph 13 of the ▇▇▇▇▇▇ City Council Minutes
and no conditions, restrictions or other limitations are imposed on the
Birmingham Property pursuant to the Birmingham Conditional Use Approval other
than as may be expressly set forth in said paragraph 13 of the ▇▇▇▇▇▇ City
Council Minutes. The Birmingham Conditional Use Approval is in full force and
effect. The Seller has provided a true and correct copy of the Birmingham
Conditional Use Approval to the Buyer. No other zoning approvals in addition to
the Birmingham Conditional Use Approval are required for the construction of the
Birmingham Facility in accordance with the Birmingham Plans and Specifications,
the Birmingham Development Agreement and this Agreement or the operation of the
Birmingham Facility in accordance with its Primary Intended Use. Upon the
completion of the construction of the Birmingham Facility in accordance with the
Birmingham Plans and Specifications, the Birmingham Development Agreement and
this Agreement, all of the conditions, restrictions and other limitations set
forth in the Birmingham Conditional Use Approval relating to the construction
and development of the Birmingham Facility, as well as all other applicable
zoning requirements relating to the construction and development of the
Birmingham Facility shall be fully satisfied. The operation of the Birmingham
Facility in accordance with its Primary Intended Use will not violate the
Birmingham Conditional Use Approval or any other applicable zoning requirement.
All appeal periods relating to the granting of the Birmingham
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Conditional Use Approval have expired with no appeals having been filed or all
appeals having been conclusively decided in favor of the owner of the Birmingham
Real Property. The Birmingham Conditional Use Approval runs with the land.
6.43 Additional Representations Regarding the Overland Park Property.
a. Zoning and Land Use Matters. The Overland Park Special Permit is in
full force and effect. The Seller has provided a true and correct copy of the
Overland Park Special Permit to the Buyer. No other zoning approvals in addition
to the Overland Park Special Permit are required for the construction of the
Overland Park Facility in accordance with the Overland Park Plans and
Specifications, the Overland Park Development Agreement and this Agreement or
the operation of the Overland Park Facility in accordance with its Primary
Intended Use. Upon the completion of the construction of the Overland Park
Facility in accordance with the Overland Park Plans and Specifications, the
Overland Park Development Agreement and this Agreement, all of the conditions,
restrictions and other limitations set forth in the Overland Park Special Permit
relating to the construction and development of the Overland Park Facility, as
well as all other applicable zoning requirements relating to the construction
and development of the Overland Park Facility shall be fully satisfied. The
operation of the Overland Park Facility in accordance with its Primary Intended
Use will not violate the Overland Park Special Permit or any other applicable
zoning requirement. All appeal periods relating to the granting of the Overland
Park Special Permit have expired with no appeals having been filed or all
appeals having been conclusively decided in favor of the owner of the Overland
Park Real Property. The Overland Park Special Permit runs with the land. The
Department of Planning and Development Services of the City of Overland Park has
approved and authorized the quantity and layout of 42 parking spaces as shown on
the Overland Park Site Plan, pursuant to the terms of the Overland Park Special
Permit.
b. No Additional Permits. No Permit is required from any Governmental
Authority having jurisdiction over environmental, wetlands or conservation
matters, in connection with: (i) the installation of sanitary sewer lines in and
through the ▇▇▇▇▇▇▇ Creek, as shown on the survey entitled, "ALTA/ACSM Land
Title Survey Part of the NW3, ▇▇▇▇▇▇▇ ▇-▇▇- ▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇, Jo. Co., Kansas,"
prepared by ▇▇▇▇▇▇, ▇▇▇▇▇ & Warren, P.A., dated January 9, 1998, or (ii) the
drainage of storm water into the Indian Creek as shown on the Overland Park Site
Plan.
c. Overland Park Geotechnical Report. To the best of the Seller's
knowledge, after due inquiry, all of the assumptions set forth in the Overland
Park Geotechnical Report are correct and all of the recommendations set forth in
the Overland Park Geotechnical Report have been or shall be implemented prior to
the completion of the construction of the Overland Park Facility.
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6.44 Additional Representations Regarding the Hockessin Property.
a. Zoning and Land Use Matters. The Hockessin Variance is in full
force and effect. The Seller has provided a true and correct copy of the
Hockessin Variance to the Buyer. No other zoning approvals in addition to the
Hockessin Variance are required for the construction of the Hockessin Facility
in accordance with the Hockessin Plans and Specifications, the Hockessin
Development Agreement and this Agreement or the operation of the Hockessin
Facility in accordance with its Primary Intended Use. Upon the completion of the
construction of the Hockessin Facility in accordance with the Hockessin Plans
and Specifications, the Hockessin Development Agreement and this Agreement, (i)
all of the conditions, restrictions and other limitations set forth in the
Hockessin Variance relating to the construction and development of the Hockessin
Facility shall be fully satisfied and (ii) all other applicable zoning
requirements relating to the construction and development of the Hockessin
Facility shall be fully satisfied. The operation of the Hockessin Facility in
accordance with its Primary Intended Use will not violate the Hockessin Variance
or any other applicable zoning requirement. All appeal periods relating to the
granting of the Hockessin Variance have expired with no appeals having been
filed or all appeals having been conclusively decided in favor of the owner of
the Hockessin Real Property. The Hockessin Variance runs with the land.
b. No Additional Permits. No Permit is required from any Governmental
Authority having jurisdiction over environmental, wetlands or conservation
matters in connection with the construction of the Hockessin Facility.
c. Subdivision Approvals. The Hockessin Real Property constitutes a
separate subdivided lot. Without limiting the foregoing, all applicable
subdivision approvals relating to the Hockessin Real Property that are required
under applicable law have been obtained, all appeal periods relating thereto
have expired with no appeals having been filed or all appeals having been
conclusively decided in favor of the owner of the Hockessin Real Property.
d. Hockessin Lease Documents. No Development Fee (i) is included in
the Hockessin Budget or (ii) will be advanced to the Seller under the Hockessin
Development Agreement.
6.45 Additional Representations Regarding the Blue ▇▇▇▇ Property.
a. Zoning and Land Use Matters. The Blue ▇▇▇▇ Zoning Approval and the
Blue ▇▇▇▇ Subdivision Approvals are the only zoning approvals required for the
construction of the Blue ▇▇▇▇ Facility in accordance with the Blue ▇▇▇▇ Plans
and Specifications, the Blue ▇▇▇▇ Development Agreement and this Agreement or
the operation of the Blue ▇▇▇▇ Facility in
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accordance with its Primary Intended Use. The Blue ▇▇▇▇ Zoning Approval is in
full force and effect. Upon the completion of the construction of the Blue ▇▇▇▇
Facility in accordance with the Blue ▇▇▇▇ Plans and Specifications, the Blue
▇▇▇▇ Development Agreement and this Agreement, all of the conditions,
restrictions and other limitations set forth in the Blue ▇▇▇▇ Zoning Approval
and the Blue ▇▇▇▇ Subdivision Approvals relating to the construction and
development of the Blue ▇▇▇▇ Facility, as well as all other applicable zoning
requirements relating to the construction and development of the Blue ▇▇▇▇
Facility shall be fully satisfied. The operation of the Blue ▇▇▇▇ Facility in
accordance with its Primary Intended Use will not violate the Blue ▇▇▇▇ Zoning
Approval, the Blue ▇▇▇▇ Subdivision Approvals or any other applicable zoning
requirement. All appeal periods relating to the granting of the Blue ▇▇▇▇ Zoning
Approval (and the extension thereof) have expired with no appeals having been
filed or all appeals having been conclusively decided in favor of the owner of
the Blue ▇▇▇▇ Property. As of the Blue ▇▇▇▇ Closing, all appeal periods relating
to the granting of the Blue ▇▇▇▇ Subdivision Approvals shall have expired with
no appeals having been filed or all appeals having been conclusively decided in
favor of the owner of the Blue ▇▇▇▇ Property. The Blue ▇▇▇▇ Zoning Approval runs
with the land and the Blue ▇▇▇▇ Subdivision Approvals will run with the land.
b. Widening of U.S. Route 202. From and after the acquisition by the
Seller (or any Single Purpose Entity) of any interest in the Blue ▇▇▇▇ Property,
Whitpain Township shall have no indemnification or other rights to payment
regarding the widening of U.S. Route 202 from the Seller (or any of its
successors in interest, including, without limitation, the Buyer) or, if
applicable, such Single Purpose Entity.
6.46 Additional Representations Regarding the Richmond Property. The
Richmond Real Property is currently zoned ▇-▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
pursuant to the applicable zoning ordinance. The construction of the Richmond
Facility in accordance with the Richmond Plans and Specifications and the use
and operation of the Richmond Facility in accordance with its Primary Intended
Use is permitted as a matter of right in such zone. No special use permits,
conditional use permits, variances or exceptions have been granted nor are any
needed in order to construct the Richmond Facility in accordance with the
Richmond Plans and Specifications or to operate the Richmond Facility in
accordance with its Primary Intended Use.
6.47 Year 2000. None of the computer software, computer firmware,
computer hardware (whether general or special purpose), and other similar or
related items of automated, computerized, and/or software system(s) that are
used or relied on by the Seller or any Single Purpose Entity in connection with
the operation of any Facility will malfunction, cease to function, generate
incorrect data, or produce incorrect results when processing, providing, and/or
receiving (i) date-related data into and between the twentieth and twenty-first
centuries and (ii) date-related data in connection with any valid date in the
twentieth and twenty-first centuries.
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6.48 Contingencies. The Approved Lender Contingencies and the Approved
Buyer Contingencies for the Facilities are set forth on EXHIBIT I-2 attached
hereto.
6.49 Beneficiaries. The sole beneficiaries of the ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇,
▇▇. Irrevocable Trust are the Beneficiaries.
7. Buyer's Representations and Warranties. As a material inducement for the
Seller to enter into this Agreement and to consummate the transaction
contemplated hereunder, the Buyer makes the following representations and
warranties to the Seller, which representations and warranties are true on the
date of this Agreement and shall be true and correct on each Closing Date as
though such representations and warranties were made at and as of each Closing
Date.
7.1 Legal Existence and Good Standing. The Buyer is a corporation
duly organized, validly existing and in good standing under the laws of Delaware
and has all requisite power and authority to own, lease and operate its
properties, to carry on its business as presently conducted by it.
7.2 Authority and Enforceability. The Buyer has full power and
authority to execute and deliver this Agreement and to perform all obligations
arising hereunder. This Agreement constitutes the legal, valid and binding
obligation of the Buyer, enforceable in accordance with its terms, covenants and
conditions, and there are no claims, defenses (personal or otherwise) or offsets
to the validity or enforceability against the Buyer of this Agreement.
7.3 No Conflict. The execution, delivery and performance by the Buyer
of this Agreement and the Seller Documents to which the Buyer shall be a party
do not and will not contravene any provision of (a) the Buyer's organizational
documents or any agreement to which the Buyer is a party or (b) any present
judgment, order, decree, writ or injunction applicable to the Buyer.
7.4 CareMatrix Approval. The Buyer has obtained the CareMatrix
Approval.
7.5 CareMatrix Net Worth. CareMatrix has a Tangible Net Worth of not
less than FIFTY MILLION DOLLARS ($50,000,000).
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8. Covenants. Without limiting any of the other covenants or agreements
hereunder, the Seller and the Buyer further covenant and agree that, from and
after the date hereof:
8.1 Maintenance of Existence; Organizational Documents. During the
entire time that this Agreement remains in full force and effect, (a) the Seller
agrees that it (i) shall keep in effect its existence and rights as a limited
partnership under the laws of the state of its formation and its right to
transact business in the States in which it operates any Facility and (ii) shall
cause the General Partner to keep in effect its existence and rights as a
corporation under the laws of the state of its formation and its right to
transact business in the States in which the Facilities are located if required
by the laws of any such States and (b) the Buyer shall keep in effect its
existence and rights as a corporation under the laws of the state of its
formation.
8.2 Single Purpose Entities.
a. Alternative Ownership Structure. Upon the Buyer's receipt of any
Transfer Notice, the Buyer shall have ten (10) Business Days within which to
determine whether the use of a limited liability company to acquire the Seller's
interest in the applicable portion of the Property would create an additional
level of tax (under federal, state or local law) that would not exist under a
so-called "pass-through" entity. If the Buyer determines that such an additional
level of tax would be created, then, the Buyer may designate an Alternative
Ownership Structure and the applicable Single Purpose Entity to be created by
the Seller shall utilize such Alternative Ownership Structure; unless, such an
Alternative Ownership Structure would create any additional federal, state or
local income taxes to the Seller, in which event, the Seller shall have the
option of either creating the Single Purpose Entity utilizing the Alternative
Ownership Structure or rescinding its Transfer Notice. In the event that an
Alternative Ownership Structure is utilized, all of the covenants and
representations and warranties set forth herein regarding Single Purpose
Entities shall apply thereto, mutatis, mutandis.
b. Formation. Prior to the creation of any Single Purpose Entity, the
Seller shall obtain the Buyer's approval of the LLC Agreement to be used to
create such Single Purpose Entity, which approval shall not be unreasonably
withheld. The Seller shall not terminate, amend, abridge, modify or otherwise
limit any of the provisions of the LLC Agreement without the prior written
consent of the Buyer, which consent shall not be unreasonably withheld. As of
the Closing Date relating to the consummation of any acquisition by the Buyer of
all of the equity interests in any Single Purpose Entity, the Seller shall not
permit any Person to hold any power of attorney from such Single Purpose Entity.
The Seller shall cause each Single Purpose Entity to keep in effect its
existence and rights as a Delaware limited liability company and its rights to
transact business in the State in which the
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Facility that it operates is located during the period from the date of its
formation until the Closing involving the Facility that it operates.
c. Restrictions. No Single Purpose Entity shall incur any debt,
obligation or liability of any kind whatsoever except for the obligations
evidenced by any Transfer Documents, any applicable Lease Documents, any
applicable Future Financing Documents, any applicable Management Agreement and
any applicable licensing agreement entered into or assumed in accordance with
the terms hereof.
d. Transfer Documents. In connection with any exercise by the Seller
of its Transfer Right, concurrently with the consummation thereof, the Seller
shall provide to the Buyer, (i) true and correct copies of all documents and
instruments required to consummate any exercise of the Seller's Transfer Right
(collectively, the "Transfer Documents"), which Transfer Documents shall be in
form and substance reasonably acceptable to the Buyer and (ii) evidence
reasonably acceptable to the Buyer of the due authorization and enforceability
of the Transfer Documents. Without limiting the foregoing, in connection with
any exercise by the Seller of its Transfer Right, the Seller shall enter into a
license agreement in form and substance reasonably acceptable to the Buyer (in
each instance, a "License Agreement"), pursuant to which, for nominal
consideration, the applicable Single Purpose Entity shall be licensed to use, in
connection with the operation of the applicable Facility, the then current trade
names and trademarks of such Facility. Each License Agreement shall be deemed to
be a Transfer Document.
8.3 Financial Statements and Other Information. The Seller shall
furnish or shall cause to be furnished to the Buyer the following statements,
and other materials:
a. Monthly Statements. Within thirty (30) days after the end of each
calendar month after the CO for any Facility has been issued, (i) a
statement certified as true and correct by the Seller setting forth the
Gross Revenues of each Facility for the immediately preceding month and
(ii) an unaudited, detailed month and year to date income and expense
statement for each Facility which shall include a comparison to
corresponding budget figures and occupancy statistics (including the actual
number of residents, the number of units available and total resident days
for such month).
b. Permits. Upon the issuance thereof, true and complete copies of all
Permits.
c. Permit or Contract Surveys, Notices, Reports and Defaults. Upon
receipt thereof, true and complete copies of all surveys, follow-up
surveys, complaint surveys, examinations, compliance certificates,
inspection reports, statements (other than those statements that are
furnished in the ordinary course of business), terminations and notices of
any kind (other than those notices that are furnished in the
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ordinary course of business) issued or provided to the Seller or any Single
Purpose Entity by any Governmental Authority or Accreditation Body,
including, without limitation, any notices pertaining to any delinquency
in, or proposed revision of, the Seller's or such Single Purpose Entity's
obligations under the terms and conditions of any Permits now or hereafter
issued by any Governmental Authority or Accreditation Body and the
response(s) thereto made by or on behalf of the Seller or such Single
Purpose Entity.
d. Official Notices, Filings and Reports. Upon the completion or
filing, mailing or other delivery thereof, complete copies of all Permit
applications (other than those that are furnished in the ordinary course of
business), notices (other than those that are furnished in the ordinary
course of business), statements (other than those that are furnished in the
ordinary course of business), annual reports, cost reports and other
reports or filings of any kind (other than those that are furnished in the
ordinary course of business) provided by the Seller or any other Single
Purpose Entity to any Governmental Authority or Accreditation Body with
respect to the Property.
e. Information Provided to any Landlord or other Future Lender. Upon
the completion or filing, mailing or other delivery thereof, complete
copies of all financial statements, reports, statements, filings, notices
and other information, if any, sent by the Seller or any Single Purpose
Entity to any Landlord or Future Lender (including, without limitation, all
requisition requests hereafter made under any of the Development
Agreements).
f. Other Information. With reasonable promptness, such other
information as the Buyer may reasonably request from time to time
respecting (i) the financial condition and affairs of the Property and the
Single Purpose Entities and (ii) the licensing and the operation of the
Property.
g. Default Conditions. As soon as possible and in any event within
five (5) Business Days after the occurrence of any Lease Default or Future
Financing Default or any event or state of facts which, with the giving of
notice or lapse of time or both, could constitute a Lease Default or Future
Financing Default, a written statement of the Seller setting forth details
of such Lease Default, Future Financing Default, or event and the action
which the Seller proposes to take with respect thereto.
h. Official Actions. Promptly after the commencement thereof, notice
of all actions, suits and proceedings before any Governmental Authority or
Accreditation Body which may have a material adverse effect on (i) the
ability of any member of the Selling Group to perform any of its respective
obligations under this Agreement, any of the other Seller Documents, any of
the Lease Documents, any of the Future Financing Documents or any
Management Agreements or (ii) the Property.
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i. Adverse Developments. Promptly after the Seller acquires knowledge
thereof, written notice of: (i) the potential termination of any Permit
necessary for the construction of any Development Project and/or the
ownership, leasing and/or operation of the Property; (ii) any loss, damage
or destruction to or of the Property in excess of ONE HUNDRED THOUSAND
DOLLARS ($100,000) (regardless of whether the same is covered by
insurance); and (iii) any other development materially and adversely
affecting or which may materially and adversely affect the condition,
financial or otherwise, of the Property or the ability of the Seller or any
Single Purpose Entity to fulfill any of its respective obligations under
this Agreement, the Blue ▇▇▇▇ Purchase Documents, the Richmond Purchase
Documents, any of the Lease Documents and/or any of the Future Financing
Documents.
j. Design Defects For Which the Seller has Responsibility. Promptly
after the Seller acquires knowledge thereof, written notice of any Design
Defect for Which the Seller has Responsibility.
8.4 Books and Records. The Seller shall cause to be kept and
maintained, and shall permit the Buyer and its representatives to inspect at all
reasonable times, accurate books of accounts relating to the Facilities in which
complete entries will be made reflecting all financial transactions of the
Seller, the Single Purpose Entities and/or the Managers, as applicable (showing,
without limitation, all materials ordered and received and all disbursements,
accounts payable and accounts receivable in connection with the construction of
the Development Projects and the operation of the Property). Such books and
records must accurately reflect that all funds advanced under the Development
Agreements for construction of the Development Projects have been used solely
for the payment of obligations and expenses properly incurred in connection with
said construction in accordance with the terms of this Agreement and the
Development Agreements. The Seller agrees to maintain all of its books and
records relating to any Facility for a period of three (3) years subsequent to
the consummation of the Closing pertaining to such Facility. The provisions of
this Section 8.4 shall survive the consummation of each Closing hereunder.
8.5 Restrictions. Except as may otherwise be expressly provided
herein, neither Seller, nor any Single Purpose Entity shall, without the prior
written consent of the Buyer, in each instance, which consent may be withheld in
the sole and absolute discretion of the Buyer:
a. convey, assign, hypothecate, transfer, dispose of or encumber, or
permit the conveyance, assignment, transfer, hypothecation,
disposal or encumbrance of all or any part of any legal or
beneficial interest in the Property, the Lease Documents or the
Future Financing Documents; provided, however, that this
restriction shall not apply to (i) the sale, conveyance,
assignment, hypothecation, lease or other transfer per annum of
any material asset or assets (whether now owned or hereafter
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acquired), the fair market value of which equals or is less than
TWENTY-FIVE THOUSAND DOLLARS ($25,000), individually, or ONE
HUNDRED THOUSAND DOLLARS ($100,000) collectively; (ii) without
limitation as to amount, the disposition in the ordinary course
of business of any obsolete, worn out or defective fixtures,
furnishings or equipment used in the operation of any Facility
provided that the same are replaced with fixtures, furnishings or
equipment of equal or greater utility or value; (iii) without
limitation as to amount, any sale of inventory by the Seller in
the ordinary course of business; (iv) any Resident Agreements
entered into in accordance with the terms hereof and (v) any
Transfer Documents entered into in accordance with the terms
hereof.
b. permit the use of any Facility for any purpose other than its
Primary Intended Use;
c. permit any Person other than the Seller or any Single Purpose
Entity to be the licensed operator of the Facility; or
d. liquidate, dissolve or merge or consolidate with any other
Person.
In addition, (i) ▇▇▇▇▇▇ shall maintain control of the General Partner, (ii)
there shall be no amendment to the Partnership Agreement that would limit the
authority of the General Partner thereunder, (iii) the General Partner shall
remain the sole general partner of the Seller and shall not convey, assign,
hypothecate, transfer, dispose of or encumber all or any portion of its interest
in the Seller and (iv) neither ▇▇▇▇▇▇ nor the ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, ▇▇. 1996
Irrevocable Trust shall convey, assign, hypothecate, transfer, dispose of or
encumber all or any portion of their respective interests in the General
Partner.
8.6 Non-Competition. The Limited Parties acknowledge that any
competition by any of the Limited Parties with the Buyer (or any of its
successors in interest, including, without limitation, any Nominee) upon the
transfer of the Seller's interest in any Facility (or the Seller's interest in
any Single Purpose Entity), would cause irreparable harm to (a) the Buyer, (b)
if applicable, the Single Purpose Entity acquired by the Buyer and (c) any
applicable successor in interest to the Buyer or such Single Purpose Entity.
From and after the date hereof until the fifth anniversary of the
applicable Closing Date involving any Facility hereunder, no Limited Party,
shall be involved in any capacity in or lend any of their names to or engage in
any capacity in any assisted living facility or independent living facility (or
other facility operated for any use included within the definition of Primary
Intended Use of the applicable Facility involved in such Closing), center, unit
or
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program (or in any Person engaged in any such activity or any related activity
competitive therewith), excluding, if applicable, the Excluded Facilities,
whether such competitive activity shall be as an officer, director, owner,
employee, agent, advisor, independent contractor, developer, lender, sponsor,
venture capitalist, administrator, manager, investor, partner, joint venturer,
consultant or other participant in any capacity whatsoever with respect to an
assisted living facility (or other facility operated for any use included within
the definition of the applicable Primary Intended Use), center, unit or program
located within a fifteen (15) mile radius of the applicable Facility and the
portion of the Property relating thereto.
The Limited Parties hereby acknowledge and agree that none of the time
span, scope or area covered by the foregoing restrictive covenants is or are
unreasonable and that it is the specific intent of the Limited Parties that each
and all of the restrictive covenants set forth hereinabove shall be valid and
enforceable as specifically set forth herein. The Limited Parties further agree
that these restrictions are special, unique, extraordinary and reasonably
necessary for the protection of the Buyer (and its successors in interest) and
that the violation of any such covenant by any of the Limited Parties would
cause irreparable damage to the Buyer (and/or its applicable successors in
interest) for which a legal remedy alone would not be sufficient to fully
protect such parties.
Therefore, in addition to and without limiting any other remedies available
at law or hereunder, in the event that any of the Limited Parties breaches any
of the restrictive covenants hereunder or shall threaten breach of any of such
covenants, then the Buyer, the applicable Single Purpose Entity and/or their
respective successors in interest shall be entitled to obtain equitable
remedies, including, without limitation, specific performance and injunctive
relief, to prevent or otherwise restrain a breach of this Section (without the
necessity of posting a bond) and to recover any and all costs and expenses
(including, without limitation, attorneys' fees and expenses and court costs)
reasonably incurred in enforcing the provisions of this Section. The existence
of any claim or cause of action of any of the Limited Parties against the Buyer,
whether predicated upon this Agreement or otherwise, shall not constitute a
defense to the enforcement by the Buyer, any Single Purpose Entity or any of
their respective successors in interest of the foregoing restrictive covenants
and the Limited Parties shall not defend on the basis that there is an adequate
remedy at law.
Without limiting any other provision of this Agreement, the parties hereto
acknowledge that the foregoing restrictive covenants are severable and separate.
If at any time any of the foregoing restrictive covenants shall be deemed
invalid or unenforceable by a court having jurisdiction over this Agreement, by
reason of being vague or unreasonable as to duration, or geographic scope or
scope of activities restricted, or for any other reason, such covenants shall be
considered divisible as to such portion and such covenants shall be immediately
amended and reformed to include only such covenants as are deemed reasonable and
enforceable by the court having jurisdiction over this Agreement to the full
duration, geographic scope and scope of restrictive activities deemed reasonable
and thus enforceable by said court; and the parties
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agree that such covenants as so amended and reformed, shall be valid and binding
as though the invalid or unenforceable portion has not been included therein.
The provisions of this Section shall survive the execution and delivery of
this Agreement, each Closing consummated hereunder and any termination of this
Agreement. The parties hereto acknowledge and agree that any Single Purpose
Entity and any successor in interest to the Buyer or any Single Purpose Entity
may enforce the provisions of this Section as a third party beneficiary.
8.7 Employees. From and after the date of the formation of any Single
Purpose Entity, the Seller shall not permit any Single Purpose Entity to hire
any employees. All employees at any Facility owned or leased by any Single
Purpose Entity shall be hired by, and be the employees of, such Facility's
Manager.
8.8 Changes in Fiscal Year and Accounting Procedures. The Seller shall
not, without the prior written consent of the Buyer, in each instance, which
consent may be withheld in the Buyer's sole and absolute discretion, permit any
Single Purpose Entity to (a) change its fiscal year or capital structure or (b)
change, alter, amend or in any manner modify, except in accordance with GAAP,
any of its accounting procedures related to the method of revenue recognition,
billing procedures or determinations of doubtful accounts or bad debt expenses
(each of which shall be substantially similar to the procedures currently
utilized by the Seller), nor will the Seller permit any circumstance to exist in
which any Single Purpose Entity is not wholly-owned by the Seller.
8.9 Impositions. Subject to the provisions of Section 8.10 hereof, the
Seller shall pay, or cause to be paid, without deduction (except such discount
as may be permitted by law), defalcation or abatement, not later than the last
day on which the same may be paid without penalty or interest, all real estate
taxes, ground rents, sewer rents, water charges and all other municipal and
governmental assessments, fees (including, without limitation, license, permit,
inspection, authorization and similar fees), taxes, rates, charges, impositions,
levies, liabilities, obligations, special assessments and Liens of every kind
and nature (collectively, the "Impositions") that now or hereafter may be
imposed, suffered, placed, assessed, levied or filed at any time, upon (a) the
Seller's or any Single Purpose Entity's interest in the Property, (b) the
Property or any Rent therefrom or any estate, right, title or interest therein
and/or (c) any occupancy, leasing, operation, use or possession of, sales from,
or activity conducted on, or in connection with, the Property. Furthermore, if
any such Imposition is of record, the same shall be promptly satisfied and
discharged of record and evidence of such discharge of record (satisfactory to
the Buyer) shall be forwarded to the Buyer on or before the date required
hereunder for payment of such Imposition.
8.10 Permitted Contests. Unless otherwise prohibited by any applicable
Lease Documents or Future Financing Documents, upon prior
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written notice to the Buyer, any member of the Selling Group, at its sole cost
and expense, may contest, by appropriate legal proceedings conducted in good
faith and with due diligence (until the resolution thereof), the amount,
validity or application, in whole or in part, of any Imposition, any Legal
Requirement, the decision of any Governmental Authority related to the operation
of the Property for its Primary Intended Use or any Lien or claim not otherwise
permitted by this Agreement; provided, that (a) prior written notice of such
contest is given to the Buyer, (b) in the case of an unpaid Imposition, Lien or
claim, the commencement and continuation of such proceedings shall suspend the
collection thereof from the applicable member of the Selling Group and
compliance by such applicable member of the Selling Group with the contested
Legal Requirement or other matter may legally be delayed pending the prosecution
of any such proceeding without the occurrence or creation of any additional
Lien, charge or liability of any kind against the Property, and (c) neither the
Property nor any interest (direct or indirect) of the Seller (or any Single
Purpose Entity) therein would be in any immediate danger of being sold,
forfeited, attached or lost as a result of such proceeding.
8.11 Repair; Use; Compliance With Law; Alterations; Waste. At all
times until the Closing involving any Facility is consummated in accordance with
the terms hereof, such Facility and the applicable portion of the Property
relating thereto shall be maintained in good order, repair and condition (damage
from (a) any Casualty and (b) any Design Defect for Which the Seller has
Responsibility expressly not excepted), and the Seller expressly agrees that it
will neither permit nor suffer any waste upon the Property, nor cause or permit
any nuisance thereon, nor do any act whereby the Property may become less
valuable. Without limiting the foregoing, the Seller shall promptly repair all
Design Defects for Which the Seller has Responsibility.
Subject to the provisions of Section 8.22 hereof, no additional improvement
may be constructed on the Real Property, nor may any improvement on the Real
Property be materially altered, removed or demolished without the prior written
consent of the Buyer in each instance, which consent may be withheld in the
Buyer's reasonable discretion. Without limiting any of the Buyer's other rights
of entry pursuant to the terms of this Agreement, the Seller shall permit (and
shall cause its Subsidiaries and Affiliates, including, without limitation, any
Single Purpose Entity to permit) the Buyer to enter the Property at any
reasonable time and upon reasonable prior notice to determine whether the
Property is in compliance with the provisions of this Section.
Subject to the provisions of Section 8.22 hereof, the Seller covenants
that, from and after the issuance of any CO pertaining to any Facility, the
Facility and the applicable portion of the Property relating thereto shall be
continuously operated in accordance with its respective Primary Intended Use
(unless such operations are temporarily interrupted as a result of any Casualty
or any permitted renovations or repairs to the Facility) and for such other uses
as may be necessary in connection with or incidental to such Primary Intended
Use.
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The Seller further covenants that the operation of the Property shall be
conducted in a manner consistent with the prevailing standards and practices
recognized in the assisted living industry as those customarily utilized by
first class business operations. Subject to any applicable Legal Requirements,
the Seller and any applicable Single Purpose Entities shall use their best
efforts to maximize each Facility's Gross Revenues, and to that end, but without
limiting the foregoing, (a) a full staff of employees shall be maintained at
each Facility and (b) a maximum amount of space in the Facility shall be devoted
to resident uses and only such part thereof shall be devoted for storage, office
and other ancillary purposes as shall be reasonably necessary.
No use shall be made or permitted to be made of the Property and no acts
shall be done which will cause the cancellation of any insurance policy required
pursuant to the terms this Agreement, nor shall the Seller, any Single Purpose
Entity or any other Person sell or otherwise provide to Residents, other
occupants or invitees therein, or permit to be kept, used or sold in or about
the Property any article which may be prohibited by any Legal Requirement or by
the standard form of fire insurance policies, any other insurance policies
required to be carried hereunder or fire underwriters' regulations.
Subject to the provisions of Section 8.33 of this Agreement, until the
consummation of any Closing, the Seller, at its sole cost and expense, shall (i)
fully comply (shall cause any Single Purpose Entity to fully comply and shall
use its best efforts to cause every other occupant of the applicable Facility,
as well as all of their respective agents and invitees, to fully comply) with
all Legal Requirements and Insurance Requirements pertaining to such Facility
and the portion of the Property relating thereto, whether or not compliance
therewith shall require any structural change of the applicable portion of the
Property or interfere with the use and enjoyment thereof and (ii) procure,
maintain and comply (shall cause any Single Purpose Entity to procure, maintain
and/or comply and shall use its best efforts to cause every other occupant of
the applicable portion of Property, as well as their respective agents and other
invitees, to procure, maintain and/or comply, as the case may be) with all
Permits, accreditations, qualifications and other authorizations required for
the continued use of such Facility for its Primary Intended Use and for the
proper construction, development, operation, repair and maintenance of the
Facility and the portion of the Property relating thereto.
The Seller shall not initiate, join in or consent to (x) any change in any
zoning or similar land use classification affecting any portion of the Property,
any subdivision of any portion of the Property or any special assessment with
respect to any portion of the Property or (y) any private restrictive covenant
or other public or private restriction upon the use of any portion of the
Property, in each instance, without the Buyer's prior written consent, which
consent shall not unreasonably be withheld.
8.12 Construction Covenants.
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a. Construction of the Development Projects. At its sole cost and
expense, the Seller shall diligently and continuously cause the Development
Projects to be constructed and completed and made ready for occupancy and use in
accordance with the Project Plans, this Agreement and the Development
Agreements. Without limiting the foregoing, (i) the Seller will use diligent
efforts to obtain the Future Permits and Contracts when and as needed or as
required by applicable Legal Requirements and shall do all things necessary to
obtain a CO for each Development Project and (ii) the Seller shall provide such
evidence as the Buyer may from time to time reasonably request that the
conditions set forth in any of the Construction Permits and Contracts or
Development Agreements have been completed. Without limiting the terms of any
other provisions set forth herein, during the course of the construction of each
Development Project, the Seller shall provide the Buyer with copies of all
requisition requests (including, without limitation, all back-up materials
supporting such requests) submitted to any Landlord or Future Lender requesting
the disbursement of funds under any Development Agreement.
In the event that the Seller determines that (x) any changes to the
applicable Project Plans are required (other than to accommodate any design or
structural changes) and/or (y) the actual cost of the construction and
development of any Development Project will exceed the Maximum Amount for such
Development Project notwithstanding any actual savings achieved by the Seller in
the course of the construction of the Development Project, the Seller shall
notify the Buyer of such determination (and provide the Buyer with any
information or documentation reasonably requested by the Buyer regarding the
same) and provided, that, the proposed increased cost is not payable to any
Affiliate of the Seller (including, without limitation, ▇▇▇▇▇▇) or any Affiliate
of ▇▇▇▇▇▇, then, (I) if the sum of the proposed increased cost plus the
aggregate amount of any increased costs previously incurred in accordance with
the terms hereof for such Development Project does not exceed the Contingency
Adjustment for such Development Project, (aa) notwithstanding anything to the
contrary set forth herein, the Buyer's consent to any proposed change to the
applicable Project Plans required in connection with any such proposed increased
cost shall not be required hereunder, (bb) if the applicable Landlord or Future
Lender agrees to increase the Maximum Amount set forth under the applicable
Development Agreement in order to cover any such proposed increased cost, the
applicable Lease Documents or Future Financing Documents may be amended without
the Buyer's consent so long as any such amendment only increases the Maximum
Amount to cover the applicable proposed increased cost, no other substantive
changes are made to the applicable Lease Documents or Future Financing Documents
and the Buyer receives a true and correct copy of any such amendment and (cc) if
the applicable Landlord or Future Lender does not agree to increase the Maximum
Amount set forth under the applicable Development Agreement in order to cover
any such proposed increased cost, the Buyer will pay to the Seller at the
applicable Closing, in addition to the applicable Facility Purchase Price (as
the same may be adjusted pursuant to the terms of this Agreement), an amount
equal to such proposed increased cost (to the extent that the same is actually
incurred by the Seller) or (II) if the sum of the proposed increased cost plus
the aggregate amount of any increased costs previously incurred in accordance
with the terms hereof for such Development Project exceeds the
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Contingency Adjustment for such Development Project and (aa) the Buyer does not
approve of the proposed increase in cost, then, within fifteen (15) Business
Days after the Buyer notifies the Seller that it will not approve of the
proposed increase in cost, the Seller may elect to pay such increased cost or
may elect to exclude the applicable Development Project from this Agreement by
written notice to the Buyer, whereupon the Buyer and the Seller shall have no
further rights and/or obligations hereunder with regard to such Development
Project or (bb) the Buyer approves of the proposed increase in cost and to any
proposed change to the applicable Project Plans, then if the applicable Landlord
or Future Lender agrees to increase the Maximum Amount set forth under the
applicable Development Agreement in order to cover any such proposed increased
cost, the applicable Lease Documents or Future Financing Documents may be
amended to increase the Maximum Amount to cover the applicable proposed
increased cost as long as no other substantive changes are made to the
applicable Lease Documents or Future Financing Documents and the Buyer receives
a true and correct copy of any such amendment or if the applicable Landlord or
Future Lender does not agree to increase the Maximum Amount set forth under the
applicable Development Agreement in order to cover such proposed increased cost,
the Buyer will pay to the Seller at the applicable Closing, in addition to the
applicable Facility Purchase Price (as the same may be adjusted pursuant to the
terms of this Agreement), an amount equal to such proposed increased cost (to
the extent that the same is actually incurred by the Seller). The Buyer and the
Seller acknowledge and agree that the maximum aggregate amount that may be
payable by the Buyer to the Seller under the foregoing clause (I) (cc) for any
Development Project is an amount equal to the Contingency Adjustment for such
Development Project. The Buyer and the Seller also acknowledge and agree that
the maximum aggregate amount by which any Maximum Amount set forth in any
Development Agreement as of the date hereof or, if applicable, as may be
hereafter agreed to for the Richmond Facility, the West Bloomfield Hills
Facility or the ▇▇▇▇▇▇▇▇▇▇ Facility, may be increased pursuant to the foregoing
clause (I) (bb) is an amount equal to the Contingency Adjustment for such
Development Project.
b. Quality of Materials and Workmanship. The materials used in each
Development Project shall be of the quality called for by the applicable Project
Plans, and the workmanship (including, without limitation, level of finish)
shall be substantially and in all material respects in conformity with the
Construction Contracts, this Agreement and the Development Agreements and both
the quality of such materials and such workmanship (including, without
limitation, the level of finish) shall be satisfactory to the Buyer. Without
limiting the foregoing, the level of finish for each Development Project shall
at least be equivalent in quality to the level of finish of the Naples Facility.
Except as otherwise expressly provided herein, the Seller shall not make any
changes in, and shall not permit any General Contractor or any Architect to make
any changes in, the quality of such materials, the Project Plans, whether by
change order or otherwise, without (i) the prior written consent of the Buyer,
in each instance (which consent may be withheld in the Buyer's sole and absolute
discretion) and (ii) complying with the terms of the applicable Development
Agreement pertaining to any such change. The Buyer shall respond to the Seller
with regard to any requested change within two (2) Business Days after such
request is made to the Buyer and the
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Buyer has received all materials and information as may be reasonably necessary
to evaluate such request. Notwithstanding the foregoing, prior to making any
change in Project Plans, copies of all change orders shall be submitted by the
Seller to the Buyer and the Seller shall also deliver to the Buyer evidence
satisfactory to the Buyer, in its reasonable discretion, that all necessary
Permits and/or Contracts required by any Governmental Authority in connection
therewith and all necessary consents from any applicable Landlord or Future
Lender relating thereto have been obtained or entered into, as the case may be.
Any failure by the Buyer to notify the Seller whether the Buyer approves of such
requested change during the requisite time period shall be deemed to be an
approval of the same.
The Buyer and the Seller acknowledge that the Buyer has not reviewed or
approved the Project Specifications Manuals for the Naples Facility, the
Germantown Facility or the Birmingham Facility. The Seller agrees to provide the
same to the Buyer for review within one month from the date hereof. The Buyer
acknowledges and agrees that it will approve of such Project Specifications
Manuals if such Project Specifications Manuals are substantially similar, in all
material respects, to the Project Specifications Manuals for the other Approved
Property described on EXHIBIT C-2, EXHIBIT C-3, EXHIBIT C-4, EXHIBIT C-6, and
EXHIBIT C-8. The Buyer has approved the plans and specifications relating to the
Blue ▇▇▇▇ Property listed on EXHIBIT C-2, subject to the approval of the
applicable Future Lender of the same.
c. Seller's Title To Materials. The Seller shall not use, nor allow
any General Contractor to use, in connection with any construction relating to
any Development Project, any materials, fixtures or equipment intended to become
part of such Development Project which are purchased upon lease or conditional
▇▇▇▇ of sale or to which the Seller (or, if applicable, any Landlord or Future
Lender) does not have absolute and unencumbered title, and the Seller covenants
to cause to be paid punctually all sums becoming due for labor, materials,
fixtures or equipment used or purchased in connection with any such
construction.
d. Future Permits and Contracts. Upon the issuance of any Future
Permits and Contracts (including, without limitation, all Construction Permits
and Contracts pertaining to the Blue ▇▇▇▇ Facility, the Richmond Facility, the
West Bloomfield Hills Facility and the ▇▇▇▇▇▇▇▇▇▇ Facility), the Seller shall
promptly provide true and correct copies thereof to the Buyer. Without limiting
the foregoing, prior to the commencement of construction of any Development
Project, the Seller shall provide a copy of the building permit authorizing the
construction thereof in accordance with the applicable Project Plans and for its
Primary Intended Use to the Buyer. As of the date hereof, the Buyer acknowledges
receipt of copies of building permits relating to all Development Projects other
than the Dublin, Blue Bell, Richmond, ▇▇▇▇▇▇▇▇▇▇ and West Bloomfield Hills
Development Projects.
e. Compliance With Legal Requirements And Applicable Agreements.
Subject to the provisions of Section 8.33 hereof, each Single Purpose Entity,
the Project Plans and the Property and all uses thereof shall comply with (i)
all Legal Requirements, (ii) all
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Permits and Contracts, (iii) all applicable by-laws, codes, rules, regulations
and restrictions of the Board of Fire Underwriters or other insurance
underwriters or similar body and (iv) the Lease Documents and any Future
Financing Documents.
f. Inspection Of Construction. The Buyer and its representatives,
shall, at all times throughout the term of this Agreement, have the right to
enter the Property, upon reasonable notice to the Seller and at reasonable times
for the purpose of inspecting the Property and the progress of the work and
materials thereon; provided, that, in the exercise of such access, the Buyer
shall not unreasonably interfere with the construction of any Development
Project.
g. Use of Development Proceeds. The Seller shall utilize all advances
made by any Landlord or Future Lender pursuant to the terms of any Development
Agreement only for those items for which requisitions are permitted under the
Development Agreement or for reimbursement of expenditures already made for
items for which requisitions are so permitted; provided, however, that
notwithstanding the foregoing, in no event shall any of the advances under the
Development Agreement be used to pay interest or rent payments to any Landlord
or Future Lender. Without limiting the foregoing, the proceeds advanced under
the Development Agreements may only be utilized for costs incurred in connection
with the development of the Projects in accordance with the Project Plans, the
terms of the Development Agreement and the terms of this Agreement.
h. Completion of the Development Projects. Upon the completion of the
construction of each Development Project in accordance with the applicable
Project Plans and the terms and provisions of this Agreement and the applicable
Development Agreement, the Seller shall provide the Buyer with (i) true, correct
and complete copies of (x) the CO issued by the appropriate Governmental
Authorities, permitting the occupancy and use of the applicable Development
Project for its Primary Intended Use and (y) all Permits issued by the
appropriate Governmental Authorities which are necessary in order to operate
such Development Project in accordance with its Primary Intended Use (including,
without limitation, the applicable Operating Permit), (ii) a certification from
the applicable Architect, in form and substance reasonably acceptable to the
Buyer, stating that, to the best of such Architect's professional knowledge and
belief and in accordance with all applicable professional standards of care,
such Development Project was completed substantially and in all material
respects in accordance with the Project Plans relating thereto, (iii) an
as-built survey (showing all improvements and applicable Permitted Encumbrances)
of the applicable portion of the Property upon which the applicable Development
Project is located reasonably acceptable to the Buyer and (iv) an estoppel
certificate signed by the Seller and the applicable Landlord or Future Lender,
in form and substance reasonably acceptable to the Buyer, containing a
certification from the Seller verifying the actual amounts of the cost of
constructing the applicable Development Project and the Development Fee paid to
it (or any other Affiliate) and a certification from the Seller and such
applicable Landlord or Future Lender verifying the total amount of the proceeds
actually advanced under such applicable
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Development Agreement. In addition, the Seller shall arrange for all instruments
relating to any of the Construction Contracts (such as a Notice of Commencement)
to be terminated of record.
i. Additional Covenants Regarding the Completion of the Blue ▇▇▇▇
Development Project. The Seller acknowledges that as of the date of the
execution and delivery of this Agreement, (i) the Seller does not hold any
interest in the Blue ▇▇▇▇ Real Property other than its right to purchase the
same pursuant to the Blue ▇▇▇▇ Purchase Agreement and (ii) the Blue ▇▇▇▇
Architect's Contract, the Blue ▇▇▇▇ Construction Contract, the Blue ▇▇▇▇ Plans
and Specifications, the Blue ▇▇▇▇ Subdivision Approvals, the Blue ▇▇▇▇ Survey,
the Blue ▇▇▇▇ Purchase Documents, the Blue ▇▇▇▇ Title Insurance Commitment
(including, without limitation, all matters taken as exceptions therein) and the
status of the Blue ▇▇▇▇ Property's compliance with applicable Legal Requirements
(including, without limitation, zoning and land use matters) have not been
reviewed or approved by the Buyer. Accordingly, prior to the consummation of the
acquisition of the Blue ▇▇▇▇ Real Property pursuant to the terms of the Blue
▇▇▇▇ Purchase Agreement or the commencement of construction of the Blue ▇▇▇▇
Facility, the Seller shall deliver true and correct copies of all of the
foregoing items to the Buyer, for its review and approval and, after the Buyer's
receipt of such items, the Buyer shall also have the right to review and approve
the status of the Blue ▇▇▇▇ Property's compliance with applicable Legal
Requirements. The Buyer agrees to notify the Seller whether it has approved the
Blue ▇▇▇▇ Architect's Agreement or the Blue ▇▇▇▇ Construction Contract within
three (3) Business Days after the Buyer's receipt of true and correct copies of
the final drafts of such agreements. Any failure by the Buyer to notify the
Seller whether the Buyer approves of any such agreement during the requisite
time period shall be deemed to be an approval of the same. In addition, prior to
the commencement of the construction of the Blue ▇▇▇▇ Facility, the Seller shall
provide the Buyer with a written certification identifying the Construction
Permits and Contracts pertaining to the Blue ▇▇▇▇ Facility.
▇. ▇▇▇▇▇▇▇▇ Development Project. The Seller acknowledges that as of
the date of the execution and delivery of this Agreement, (i) the Seller does
not hold any interest in the Richmond Real Property other than its right to
purchase the same pursuant to the Richmond Purchase Agreement and (ii) the
Richmond Budget, the Richmond Construction Contract, the Richmond Plans and
Specifications, the Richmond Survey, the Richmond Purchase Documents, the
Richmond Title Insurance Commitment (including, without limitation, all matters
taken as exceptions therein) and the status of the Richmond Property's
compliance with applicable Legal Requirements (including, without limitation,
zoning and land use matters) have not been reviewed or approved by the Buyer.
Accordingly, prior to the consummation of the acquisition of the Richmond
Property pursuant to the terms of the Richmond Purchase Agreement or the
commencement of construction of the Richmond Facility, the Seller shall deliver
true and correct copies of all of the foregoing items to the Buyer, for its
review and approval and, after the Buyer's receipt of such items, the Buyer
shall also have the right to review and approve the status of the Richmond
Property's compliance with applicable Legal Requirements. The Buyer agrees to
notify the Seller whether it has
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approved the Richmond Construction Contract within three (3) Business Days after
the Buyer's receipt of a true and correct copy of the final draft of such
agreement. Any failure by the Buyer to notify the Seller whether the Buyer
approves of any such agreement during the requisite time period shall be deemed
to be an approval of the same. In addition, prior to the commencement of the
construction of the Richmond Facility, the Seller shall provide the Buyer with a
written certification identifying the Construction Permits and Contracts
pertaining to the Richmond Facility. In the event that prior to the consummation
of the acquisition of the Richmond Real Property pursuant to the terms of the
Richmond Purchase Agreement, the Seller, in good faith and in the exercise of
prudent business judgement, elects not to construct the Richmond Facility for
any reason whatsoever, the Seller shall so notify the Buyer in writing and shall
terminate the Richmond Purchase Agreement; whereupon the Seller and the Buyer
shall have no further rights and/or obligations hereunder with regard to the
Richmond Property. In the event that the Buyer does not approve the Richmond
Budget, then, the Seller shall have the right to exclude the Richmond Facility
from this Agreement upon written notice to the Buyer, whereupon the Buyer and
the Seller shall have no further rights and/or obligations hereunder with regard
to the Richmond Property; provided, that, (a) the Richmond Budget was prepared
in good faith by the Seller and approved by any Future Lender in connection with
any Future Financing permitted under the terms of Section 8.14 hereof without
the Buyer's consent and (b) the Seller in good faith attempted to address any
reasonable concerns or objections raised by the Buyer concerning the Richmond
Budget.
k. Additional Covenants Regarding the Completion of the West
Bloomfield Hills Development Project. The Seller acknowledges that as of the
date of the execution and delivery of this Agreement, (i) the Seller does not
hold any interest in the West Bloomfield Hills Real Property other than its
right to purchase the same pursuant to the West Bloomfield Hills Purchase
Agreement and (ii) the West Bloomfield Hills Architect's Contract, the West
Bloomfield Hills Budget, the West Bloomfield Hills Construction Contract, the
West Bloomfield Hills Plans and Specifications, the West Bloomfield Hills
Survey, the West Bloomfield Hills Purchase Agreement and the West Bloomfield
Hills Title Insurance Commitment (including, without limitation, all matters
taken as exceptions therein) have not been reviewed or approved by the Buyer.
Accordingly, prior to the consummation of the acquisition of the West Bloomfield
Hills Real Property pursuant to the terms of the West Bloomfield Hills Purchase
Agreement or the commencement of construction of the West Bloomfield Hills
Facility, the Seller shall deliver true and correct copies of all of the
foregoing items to the Buyer, for its review and approval and, after the Buyer's
receipt of such items, the Buyer shall also have the right to review and approve
the status of the West Bloomfield Hills Property's compliance with applicable
Legal Requirements. The Buyer agrees to notify the Seller whether it has
approved the West Bloomfield Hills Architect's Agreement or the West Bloomfield
Hills Construction Contract within three (3) Business Days after the Buyer's
receipt of true and correct copies of the final drafts of such agreements. Any
failure by the Buyer to notify the Seller whether the Buyer approves of any such
agreements during the requisite time period shall be deemed to be an approval of
the same. In addition, prior to the commencement of the construction of the West
Bloomfield Hills Facility, the Seller shall
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provide the Buyer with a written certification identifying the Construction
Permits and Contracts pertaining to the West Bloomfield Hills Facility. In the
event that prior to the consummation of the acquisition of the West Bloomfield
Hills Real Property pursuant to the terms of the West Bloomfield Hills Purchase
Agreement, the Seller elects not to construct the West Bloomfield Hills Facility
for any reason whatsoever, the Seller shall so notify the Buyer in writing and
shall terminate the West Bloomfield Hills Purchase Agreement; whereupon the
Seller and the Buyer shall have no further rights and/or obligations hereunder
with regard to the West Bloomfield Hills Property. In the event that the Buyer
does not approve the West Bloomfield Hills Budget, then, the Seller shall have
the right to exclude the West Bloomfield Hills Facility from this Agreement upon
written notice to the Buyer, whereupon the Buyer and the Seller shall have no
further rights and/or obligations hereunder with regard to the West Bloomfield
Hills Property; provided, that, (a) the West Bloomfield Hills Budget was
prepared in good faith by the Seller and approved by any Future Lender in
connection with any Future Financing permitted under the terms of Section 8.14
hereof without the Buyer's consent and (b) the Seller in good faith attempted to
address any reasonable concerns or objections raised by the Buyer concerning the
West Bloomfield Hills Budget.
▇. ▇▇▇▇▇▇▇▇▇▇ Development Project. The Seller acknowledges that as of
the date of the execution and delivery of this Agreement, (i) the Seller does
not hold any interest in the ▇▇▇▇▇▇▇▇▇▇ Real Property other than its right to
purchase the same pursuant to the ▇▇▇▇▇▇▇▇▇▇ Purchase Agreement and (ii) the
▇▇▇▇▇▇▇▇▇▇ Architect's Agreement, ▇▇▇▇▇▇▇▇▇▇ Budget, the ▇▇▇▇▇▇▇▇▇▇ Construction
Contract, the ▇▇▇▇▇▇▇▇▇▇ Plans and Specifications, the ▇▇▇▇▇▇▇▇▇▇ Survey, the
▇▇▇▇▇▇▇▇▇▇ Purchase Documents and the ▇▇▇▇▇▇▇▇▇▇ Title Insurance Commitment
(including, without limitation, all matters taken as exceptions therein) have
not been reviewed or approved by the Buyer. Accordingly, prior to the
consummation of the acquisition of the ▇▇▇▇▇▇▇▇▇▇ Property pursuant to the terms
of the ▇▇▇▇▇▇▇▇▇▇ Purchase Agreement or the commencement of construction of the
▇▇▇▇▇▇▇▇▇▇ Facility, the Seller shall deliver true and correct copies of all of
the foregoing items to the Buyer, for its review and approval and, after the
Buyer's receipt of such items, the Buyer shall also have the right to review and
approve the status of the ▇▇▇▇▇▇▇▇▇▇ Property's compliance with applicable Legal
Requirements. The Buyer agrees to notify the Seller whether it has approved the
▇▇▇▇▇▇▇▇▇▇ Architect's Agreement or the ▇▇▇▇▇▇▇▇▇▇ Construction Contract within
three (3) Business Days after the Buyer's receipt of true and correct copies of
the final drafts of such agreements. Any failure by the Buyer to notify the
Seller whether the Buyer approves of any such agreements during the requisite
time period shall be deemed to be an approval of the same. In addition, prior to
the commencement of the construction of the ▇▇▇▇▇▇▇▇▇▇ Facility, the Seller
shall provide the Buyer with a written certification identifying the
Construction Permits and Contracts pertaining to the ▇▇▇▇▇▇▇▇▇▇ Facility. In the
event that prior to the consummation of the acquisition of the ▇▇▇▇▇▇▇▇▇▇ Real
Property pursuant to the terms of the ▇▇▇▇▇▇▇▇▇▇ Purchase Agreement, the Seller,
in good faith and in the exercise of prudent business judgement, elects not to
construct the ▇▇▇▇▇▇▇▇▇▇ Facility for any reason whatsoever, the Seller shall so
notify the Buyer in writing and shall terminate the ▇▇▇▇▇▇▇▇▇▇ Purchase
Agreement; whereupon the Seller and the Buyer shall have no further rights
and/or
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obligations hereunder with regard to the ▇▇▇▇▇▇▇▇▇▇ Property. In the event that
the Buyer does not approve the ▇▇▇▇▇▇▇▇▇▇ Budget, then, the Seller shall have
the right to exclude the ▇▇▇▇▇▇▇▇▇▇ Facility from this Agreement upon written
notice to the Buyer, whereupon the Buyer and the Seller shall have no further
rights and/or obligations hereunder with regard to the ▇▇▇▇▇▇▇▇▇▇ Property;
provided, that, (a) the ▇▇▇▇▇▇▇▇▇▇ Budget was prepared in good faith by the
Seller and approved by any Future Lender in connection with any Future Financing
permitted under the terms of Section 8.14 hereof without the Buyer's consent and
(b) the Seller in good faith attempted to address any reasonable concerns or
objections raised by the Buyer concerning the ▇▇▇▇▇▇▇▇▇▇ Budget.
8.13 Lease Transactions and Future Financings. The Seller shall not
(and, if applicable, shall not permit any Single Purpose Entity to) (a) except
as may otherwise be expressly permitted hereunder, terminate, amend, abridge,
modify or otherwise limit any of the provisions of any of the Lease Documents or
the Future Financing Documents, (b) exercise any rights to acquire any portion
of the Property demised under the applicable Facility Lease or extend or renew
any term thereof or (c) except as may otherwise be specifically permitted under
any Lease Documents or Future Financing Documents without the consent of the
Seller (or such Single Purpose Entity), agree that any Landlord or Future Lender
may apply all or any portion of any funds held under any Escrow Account toward
any obligation of the Seller (or such Single Purpose Entity) under any of the
Lease Documents or Future Financing Documents or expend any such funds for the
benefit of the any portion of the Property or otherwise, in each case without
first obtaining the Buyer's prior written consent, which consent the Buyer may
withhold in the Buyer's sole discretion. The Seller shall perform (or, if
applicable, shall cause any Single Purpose Entity to perform) all of its
obligations under the Lease Documents or the Future Financing Documents relating
to any Facility which have accrued or will accrue prior to the applicable
Closing Date involving such Facility in a timely manner and fully complete the
performance of all of such obligations prior to such Closing Date. The Seller
shall (i) provide the Buyer with copies of all Letters of Credit hereafter
delivered to any Landlord or Future Lender pursuant to the terms of the Lease
Documents or the Future Financing Documents and (ii) notify the Buyer of any
additional funds provided by the Seller (or any Single Purpose Entity) to any
Landlord or Future Lender to hold in any Escrow Account.
At any Closing involving any Facility leased by the Seller (whether
pursuant to the Existing Facility Leases or any Future Financing Documents), the
Seller shall execute and deliver such documents, instruments, certificates and
agreements (collectively, the "Lease Assignment and Assumption Documents") as
the Buyer shall reasonably require to evidence (a) the assignment by the Seller
to the Buyer of (i) all of the Seller's rights and obligations under the Lease
Documents and (ii) all of the Seller's right, title and interest in and to the
Escrow Accounts, if any, and all cash or other collateral (in whatever form)
then held by or behalf of the Landlord thereunder and (b) the assumption by the
Buyer of the Seller's obligations under such Lease Documents first arising after
the Closing and the release of the
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Seller from all such obligations by the applicable Landlord or Future Lender.
The Buyer shall use its best efforts to (x) obtain the Landlord's consent to the
assignment and assumption of the Lease Documents as contemplated hereby (which
consent must be in form and substance reasonably acceptable to the Buyer) and
(y) cause the Landlord to execute and deliver those Lease Assignment and
Assumption Documents to which the Landlord shall be a party, including, without
limitation, a Landlord's Estoppel Certificate confirming, in part, the accuracy
of the representations made herein by the Seller regarding the Lease Documents
and the absence of any Lease Default and any state of facts which, with the
giving of notice and/or passage of time, would constitute such a Lease Default.
All reasonable out-of-pocket expenses, if any, incurred by any Landlord in
connection with the proposed assignment and assumption of the applicable Lease
Documents shall be paid by the Buyer.
Without limiting the foregoing, it is acknowledged and agreed that the
Lease Assignment and Assumption Documents shall include, without limitation, (x)
the Assignment and Assumption Agreement Regarding Lease Documents and (y) such
amendments (collectively, the "CareMatrix Amendments") to the applicable Lease
Documents as the Buyer may reasonably require in order to (A) eliminate any
cross-default provisions that would pertain to lease or loan transactions
between (I) the Seller and/or any of its Affiliates and (II) the applicable
Landlord and/or any of its Affiliates, (B) eliminate from the lessee's option to
purchase the applicable portion of the Property and from the lessee's option to
extend the term of the applicable Facility Lease, any provision regarding the
simultaneous exercise of similar rights under leases between (I) the Seller
and/or any of its Affiliates and (II) the applicable Landlord and/or any of its
Affiliates, (C) eliminate any provisions that would limit transfers of the
capital stock of CareMatrix and (D) eliminate any default provisions that would
apply to CareMatrix other than (I) defaults relating to insolvency and (II) a
new covenant requiring CareMatrix to maintain a Tangible Net Worth of FIFTY
MILLION DOLLARS ($50,000,000).
With respect to any Facility leased by any Single Purpose Entity, the
provisions set forth above in the preceding two paragraphs shall apply mutatis,
mutandis, however, without limiting the foregoing, the Assignment and Assumption
Agreement Regarding Lease Documents shall not include any assignment of such
Single Purpose Entity's obligations under the applicable Lease Documents.
The Seller agrees to reasonably cooperate with the Buyer in connection with
the Buyer's efforts to obtain the applicable Landlord's or any Future Lender's
consent to the transactions contemplated herein. The Buyer shall use its best
efforts to obtain all such consents on or before December 31, 1998.
The Buyer acknowledges and agrees that, at each Closing, as additional
consideration hereunder, the applicable Letters of Credit previously furnished
by the Seller (or any Single Purpose Entity) to any Landlord or Future Lender
under the terms of the Lease Documents or
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Future Financing Documents relating to the applicable Facility shall be replaced
by irrevocable letters of credit obtained by the Buyer in favor of the
applicable Landlord or Future Lender in form and substance acceptable to such
Landlord or Future Lender substantially similar to the applicable Letter of
Credit being replaced (each such letter of credit is referred to herein as a
"Replacement Letter of Credit").
8.14 Additional Provisions Regarding Future Financings. The Seller
shall not consummate, nor permit any Single Purpose Entity to consummate, any
Future Financing without the Buyer's prior written consent; provided, however,
the Buyer's consent shall not be required if each of the following conditions
are satisfied: (a) the Budget for the applicable Development Project is
acceptable to and has been approved by the Buyer (which Budget may include a
Development Fee equal to five percent (5%) of the total cost to develop the
Development Project), (b) the Future Financing Documents are in form and
substance substantially similar to the Existing Lease Documents and contemplate
the transactions to be consummated herein and the CareMatrix Amendments, (c) the
lease or mortgage payments to be made under such Future Financing Documents
shall cover (but, not exceed) the lesser of the actual total cost of
construction and development of the applicable Development Project or the
applicable Maximum Amount and (d) the Future Financing is made on such terms and
conditions that are as favorable as (or more favorable than) the terms and
conditions that are contained in the Existing Lease Documents. The Seller shall
provide to the Buyer true and correct copies of all Future Financing Documents
within five (5) Business Days after the consummation of the applicable Future
Financing.
At any Closing involving any Facility owned by the Seller or any Single
Purpose Entity, the Seller shall execute and deliver such documents,
instruments, estoppel certificates and agreements (collectively, the "Loan
Assignment and Assumption Documents") as the Buyer shall reasonably require to
evidence (a) the assignment by the Seller (or such Single Purpose Entity) to the
Buyer of (i) all of the Seller's (or such Single Purpose Entity's) rights and
obligations under the Future Financing Documents and (ii) all of the Seller's
(or such Single Purpose Entity's) right, title and interest in and to the Escrow
Accounts, if any, and all cash or other collateral (in whatever form) then held
by or on behalf of the Future Lender thereunder and (b) the assumption by the
Buyer of the Seller's obligations under such Future Financing Documents first
arising after the Closing and the release of the Seller by the applicable Future
Lender from all such obligations. The Buyer shall use its best efforts to (x)
obtain the Future Lender's consent to the assignment and assumption of the
Future Financing Documents as contemplated hereby (which consent must be in form
and substance acceptable to the Buyer) and (y) cause the Future Lender to
execute and deliver those Loan Assignment and Assumption Documents to which the
Future Lender shall be a party, including, without limitation, a Mortgagee's
Estoppel Certificate confirming, in part, the accuracy of the representations
made herein by the Seller regarding the Future Financing Documents and the
absence of any Future Financing Default and any state of facts which, with the
giving of notice
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and/or passage of time, would constitute such a Future Financing Default. All
reasonable out-of-pocket expenses, if any, incurred by any Future Lender in
connection with proposed assignment and assumption of the Future Financing
Documents shall be paid by the Buyer.
Without limiting the foregoing, it is acknowledged and agreed that the Loan
Assignment and Assumption Documents shall include, without limitation, such
amendments as the Buyer may reasonably require in order to effectuate the
substantive provisions to be included in the CareMatrix Amendments.
8.15 Management Agreements. Neither the Seller, nor any Single Purpose
Entity shall enter into any Management Agreement with any Person that is not
owned or controlled by ▇▇▇▇▇▇.
8.16 Leases and Resident Agreements. Except for Resident Agreements
permitted in accordance with the provisions of the following paragraph, the
Seller shall not enter into, nor permit any Single Purpose Entity to enter into,
any Lease, nor consent to any sublease of the premises demised under any Lease,
without first obtaining in each instance the Buyer's prior written consent,
which consent the Buyer may withhold in its sole discretion. The Seller shall
not terminate, amend, abridge, modify or otherwise limit any of the provisions
set forth in any of the Leases (including, without limitation, any Facility
Lease), other than Resident Agreements permitted hereunder, without obtaining,
in each instance, the Buyer's prior written consent, which consent may not be
unreasonably withheld. The Seller shall perform (a) all of the obligations of
the lessor under the Leases (other than the Facility Leases) relating to any
Facility (including, without limitation, all Resident Agreements) and (b) all of
the obligations of the lessee under any applicable Facility Lease, in each
instance, which have accrued or will accrue prior to the Closing Date relating
to such Facility in a timely manner and fully complete the performance of all of
such obligations prior to such Closing Date.
Every Resident Agreement now or hereafter entered into shall comply in all
respects with all Legal Requirements. No Resident Agreement (whether now in
existence or hereafter entered into) shall provide for rent to decline at any
point during the term of such Resident Agreement. The Seller shall comply with
and shall cause each Single Purpose Entity to comply with all material terms and
conditions under the Resident Agreements. Each Resident Agreement (whether now
in existence or hereafter entered into) shall be entered into on arm's-length
terms, without consideration of any relationship the Seller or any of its
Affiliates may otherwise have with the tenant thereunder or any Affiliate
thereof. Without limiting any other provision set forth herein, all security
deposits of Residents under the Resident Agreements, whether held in cash or any
other form, shall be held in accordance with all applicable Legal Requirements.
8.17 Operating Agreements. The Seller shall cause all Operating
Agreements relating to any Facility or the portion of the Property
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related thereto (including, without limitation, all Management Agreements) other
than the applicable Assumed Operating Agreements to be terminated (without
recourse to any Single Purpose Entity or the Buyer) as of the consummation of
the Closing relating to such Facility. Within five (5) Business Days after the
Buyer's or the Seller's receipt of any Election Notice, the Seller shall send to
the Buyer true and correct copies of all Operating Agreements (together with any
and all amendments thereto) then in effect relating to the applicable Facility
(or any portion of the Property related thereto). Within five (5) more Business
Days thereafter, the Buyer shall give the Seller written notice of those
Operating Agreements (excluding Mandatory Agreements) that the Buyer wishes to
assume. Such Operating Agreements, if any, that the Buyer elects to assume
together with the Mandatory Agreements relating to such Facility that, on a
cumulative basis, provide for payments equal to or less than TWENTY-FIVE
THOUSAND DOLLARS ($25,000) per annum shall constitute the "Assumed Operating
Agreements" for such Facility. Upon receipt of such written notice, the Seller
shall use its best efforts to obtain all necessary consents from the third
parties to the Assumed Operating Agreements required for any assignment thereof
to the Buyer. Subject to the Seller's obligation to terminate all Operating
Agreements other than the Assumed Operating Agreements, on a timely basis and in
any event, the Seller shall fully perform or cause to be performed, prior to the
Closing Date, any and all of the Seller's or any Manager's obligations arising
and/or accruing prior to the Closing Date under the Operating Agreements. It is
understood and agreed that (a) the Buyer shall not be obligated to assume any of
the obligations under any Assumed Operating Agreement unless any necessary
consent from any third party thereto is obtained by the Seller and (b) in no
event shall the Buyer be obligated to assume any liabilities under any Mandatory
Agreements relating to any individual Facility that exceed an aggregate amount
of TWENTY-FIVE THOUSAND DOLLARS ($25,000) per annum.
8.18 ▇▇▇▇-▇▇▇▇▇-▇▇▇▇▇▇. On or before December 1, 1998, the Buyer and
Seller shall each prepare and file the applicable notices required to be filed
under the HSR Act and shall comply promptly with any requests to it from the
Federal Trade Commission or United States Department of Justice for additional
information. The Buyer and the Seller shall have the right to review in advance,
and to the extent practicable each will consult the other on, in each case
subject to applicable laws relating to the exchange of information, all the
information and written materials to be submitted to the Federal Trade
Commission and/or the United States Department of Justice under and in
accordance with the HSR Act. In exercising the foregoing right, each of the
parties hereto shall act reasonably and as promptly as practicable. The Buyer
shall pay the cost of all filing fees relating to such notices.
8.19 Buyer's Transfer Approvals. Promptly upon its receipt or delivery
of any Election Notice, the Buyer shall apply for all necessary Permits required
to allow the Buyer to acquire the Seller's interest in the applicable Facility
and the applicable portion of the Property relating thereto (or, if applicable,
to acquire the equity interests in the Single Purpose Entity that operates such
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Facility) and to operate the applicable Facility in accordance with its Primary
Intended Use (collectively, the "Buyer's Transfer Approvals"). The Seller shall
execute (and cause any applicable Single Purpose Entity to execute), on a timely
basis prior to the Closing Date, all applications and instruments, if any,
required in connection with the issuance of the Buyer's Transfer Approvals to
the Buyer. The Seller (and the Single Purpose Entities) will cooperate with the
Buyer in its attempt to obtain the Buyer's Transfer Approvals and the Buyer
shall keep the Seller apprised of the status of its applications for the Buyer's
Transfer Approvals.
8.20 Title Matters. The Seller shall remove, at or before each
Closing, any and all Liens affecting the applicable Facility or the portion of
the Property related thereto, other than the Permitted Encumbrances, which may
now exist or which may arise before the Closing Date, whether or not of record.
From and after the date hereof, the Seller shall not create or permit the
creation of any new Liens without the prior written consent of the Buyer, in
each instance, which consent may be withheld in the Buyer's sole and absolute
discretion; provided, however, that notwithstanding the foregoing, it shall not
be a default hereunder if any mechanic's liens affecting the Property (or any
portion thereof) arise subsequent to the date hereof, as long as (a) the
existence of any such Lien does not constitute a default under any of the Lease
Documents or Future Financing Documents and (b) as of the applicable Closing
Date for any Facility, all such Liens affecting such Facility (and/or any
applicable portion of the Property related thereto) are (i) released of record,
(ii) insured over by Buyer's Title Insurance Policies or (iii) bonded off by the
Seller.
8.21 Insurance. Until Closing, the Seller shall maintain the fire and
other casualty insurance on the Property required to be maintained under the
Lease Documents and the Future Financing Documents.
8.22 Casualty. Subject to the terms and provisions of Section 8.23, in
the event of any damage or destruction to any portion of the Property by reason
of fire or other hazard or casualty (a "Casualty") or Condemnation, the Seller
shall provide immediate written notice thereof to the Buyer and, unless the
Seller determines, in good faith within one hundred twenty (120) days
thereafter, that it is economically unfeasible to rebuild the Facility, the
Seller shall proceed with reasonable diligence, in full compliance with all
applicable Legal Requirements and any applicable Lease Documents or Future
Financing Documents, to perform such repairs, replacement and reconstruction
work (the "Repairs") to restore such portion of the Property to substantially
the same condition that it was in immediately prior to such damage or
destruction and to a condition adequate to operate the applicable Facility for
its Primary Intended Use and in compliance with all Legal Requirements.
If the Seller so determines that it is economically unfeasible to rebuild
the Facility, (a) the Seller shall so notify the Buyer in writing (which notice
shall provide the Buyer with the basis upon which the Seller has made such
determination), (b) the Seller shall return to the Buyer the applicable
Additional Option Payment, if any, previously paid by the Buyer with
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respect to such Facility, unless (i) only one other Facility then remains the
subject of this Agreement, in which event the Seller shall return such
Additional Option Payment plus one-half (1/2) of the Initial Option Payment to
the Buyer or (ii) there is no other Facility which remains the subject of this
Agreement, in which event the remaining portion of the Total Option Payment that
has not previously been applied to any Facility Purchase Price paid hereunder
shall be refunded to the Buyer, and (c) the applicable Facility shall be
excluded from this Agreement, whereupon the Buyer and the Seller shall have no
further rights and/or obligations hereunder with regard to such Facility, except
that if the Seller acquires (from the applicable Landlord) fee title to that
portion of the Real Property with respect to which the Casualty or Condemnation
occurred as a consequence of the Seller's determination that it is economically
unfeasible to rebuild such Facility and does not rebuild the Facility, but
subsequently determines to build a new assisted living or independent living
facility on such portion of the Real Property (the "Undeveloped Site"), (i)
notwithstanding anything to the contrary set forth herein, the Undeveloped Site
shall continue to be subject to the terms of this Agreement until (x) the
Termination Date, if the Seller has made its determination that it is
economically unfeasible to rebuild such Facility prior to December 31, 2000 or
(y) December 31, 2004, if the Seller has made its determination that it is
economically unfeasible to rebuild such Facility at anytime thereafter prior to
January 1, 2003 and (ii) such Undeveloped Site shall be treated the same
hereunder as any portion of the Property that does not constitute the Approved
Property.
In the event that any Casualty or Condemnation involves any structural
damage to any Facility that the Seller is required hereunder to repair, the
Seller shall furnish to the Buyer complete plans and specifications for the
Repairs for the Buyer's approval, in each instance, which approval shall not be
unreasonably withheld. Such plans and specifications shall provide for Repairs
of such nature, quality and extent, that, upon the completion thereof, the
applicable Facility shall be at least equal in value and general utility to its
value and general utility prior to the Casualty or Condemnation. The Seller
shall furnish to the Buyer copies of all Permits and Contracts required by all
applicable Legal Requirements in connection with the commencement and conduct of
the Repairs.
Without limiting any other provision set forth herein, the Seller shall
perform the Repairs in good and workmanlike fashion and in good faith in
accordance with the plans and specifications approved by the Buyer, the Permits
and Contracts referred to above, the requirements of any applicable Lease
Documents or Future Financing Documents and all applicable Legal Requirements.
8.23 Condemnation. In the event of any Condemnation, the Seller shall
give immediate written notice thereof to the Buyer (the "Condemnation Notice")
and, if the Buyer makes a good faith determination that (a) such Condemnation
would prevent the applicable Facility from being operated in accordance with its
Primary Intended Use and in compliance with all applicable Legal Requirements or
(b) such Condemnation would materially adversely affect the operation or
financial condition of such
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Facility, then, the Buyer shall have the option, exercisable within sixty (60)
days after the Buyer's receipt of the Condemnation Notice, to terminate the
Buyer's Call Right and the Seller's Put Right (whether or not either the Call
Right or the Put Right has been exercised) with respect to the Facility and the
portion of the Property related thereto. Upon such termination, the Seller shall
return the Additional Option Payment to the Buyer, unless (a) only one Facility
then remains the subject of this Agreement, in which event the Seller shall
return the Additional Option Payment plus one-half (1/2) of the Initial Option
Payment to the Buyer or (b) there is no Facility which remains the subject of
this Agreement, in which event the remaining portion of the Total Option Payment
that has not previously been applied to any Facility Purchase Price paid
hereunder shall be refunded to the Buyer. If the Buyer does not elect to
terminate such Call Right and Put Right, then the Seller shall proceed, with
reasonable diligence, in full compliance with the provisions of Section 8.22
above, to perform the Repairs to restore the applicable portion of the Property
to as close a condition as possible to the condition it was in immediately prior
to such Condemnation and to a condition adequate to operate the applicable
Facility for its Primary Intended Use and in compliance with all applicable
Legal Requirements.
8.24 Additional Covenants Relating to the Carmel Property.
a. Environmental Report. The Seller shall use its best efforts to
obtain and deliver to the Buyer, prior to the Carmel Closing, a true and correct
copy of the final version of the Carmel Draft Report which includes no material
changes from the Carmel Draft Report.
8.25 Additional Covenants Relating to the Germantown Property. The
Seller shall cause those certain utility improvements located on the Germantown
Real Property within the boundary lines of the Germantown Utility Easement to be
removed and shall cause the Germantown Utility Easement to be vacated and
terminated of record.
8.26 Additional Covenants Relating to the Birmingham Property. The
Seller shall use its best efforts to complete the construction of the Birmingham
Facility (in accordance with the Birmingham Plans and Specifications, the
Birmingham Development Agreement and this Agreement) as soon as possible in
order to realize the benefit of the lowest possible "Lease Spread" under the
Birmingham Lease.
8.27 Additional Covenants Relating to the Hockessin Property.
a. Removal of Waste Water Treatment. The Seller shall remove the
wastewater treatment plant currently located on the Hockessin Real Property in
accordance with all applicable Legal Requirements.
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b. Hockessin Sewer Agreement. The Seller shall comply with all of the
terms and conditions set forth in the Hockessin Sewer Agreement.
8.28 Additional Covenants Relating to the Blue ▇▇▇▇ Property.
a. Blue ▇▇▇▇ Purchase Documents. The Seller shall provide to the Buyer
copies of all Blue ▇▇▇▇ Purchase Documents, as well as all documents,
instruments, notices and due diligence materials provided to the Seller under
the Blue ▇▇▇▇ Purchase Agreement. The Buyer shall not consummate the acquisition
of the Blue ▇▇▇▇ Real Property unless and until all approvals that are required
from any Governmental Authority in order to create a separate lot consisting
only of the Blue ▇▇▇▇ Real Property in compliance with all applicable Legal
Requirements (collectively, the "Blue ▇▇▇▇ Subdivision Approvals") are obtained
and all appeal periods relating to the granting of the Blue ▇▇▇▇ Subdivision
Approvals have expired with no appeals having been filed or all appeals having
been conclusively decided in favor of the owner of the Blue ▇▇▇▇ Real Property.
8.29 Additional Covenants Relating to the Richmond Property.
▇. ▇▇▇▇▇▇▇▇ Purchase Documents. The Seller shall provide to the Buyer
copies of the Richmond Purchase Documents, as well as all documents,
instruments, notices and due diligence materials provided to the Seller under
the Richmond Purchase Agreement.
8.30 Additional Covenants Relating to the ▇▇▇▇▇▇▇▇▇▇ Property.
▇. ▇▇▇▇▇▇▇▇▇▇ Purchase Documents. The Seller shall provide to the
Buyer copies of the ▇▇▇▇▇▇▇▇▇▇ Purchase Documents, as well as all documents,
instruments, notices and due diligence materials provided to the Seller under
the ▇▇▇▇▇▇▇▇▇▇ Purchase Agreement.
8.31 Additional Covenants Relating to the West Bloomfield Hills
Property.
a. West Bloomfield Hills Purchase Documents. The Seller shall provide
to the Buyer copies of the West Bloomfield Hills Purchase Documents, as well as
all documents, instruments, notices and due diligence materials provided to the
Seller under the West Bloomfield Hills Purchase Agreement.
8.32 Seller Documents and Buyer Documents. At each Closing, (i) the
Seller shall execute and deliver all Seller
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Documents required to be delivered at such Closing and (ii) the Buyer shall
execute and deliver all Buyer Documents required to be delivered at such
Closing.
8.33 Compliance with Legal Requirements. Notwithstanding anything to
the contrary set forth in the provisions of this Agreement concerning the
requirement that the Property comply with all applicable Legal Requirements, in
the event that, at any time after the date hereof, there is a change (each a
"Change in Law") in any (a) zoning requirement applicable to any Facility or (b)
other Legal Requirement applicable to any Facility that would require structural
changes to any building constructed (or completed) after the date of the
enactment thereof, the applicable portion of the Property shall nevertheless be
deemed to be "in compliance with all Legal Requirements" notwithstanding such
Change in Law as long as the applicable Facility may be constructed (or
completed) in accordance with the applicable Project Plans and may be operated
in accordance with its Primary Intended Use without violating any applicable
Legal Requirement. In the event that such Change in Law would require any change
to the Project Plans or require any structural alteration to any Facility, the
Seller shall comply with all applicable requirements of such Change in Law.
8.34 Reliance Letters. The Seller shall use its best efforts to obtain
Reliance Letters relating to each of the Environmental Reports at no additional
cost to the Seller; provided, however, the Seller shall advise the Buyer as to
the cost of the Reliance Letters that can be obtained and if the Buyer elects,
the Seller shall obtain any such Reliance Letters on behalf of, and at the
expense of, the Buyer.
8.35 Surveys. The Seller shall use its best efforts to arrange for all
as-built surveys referred to in Section 8.12(h) hereof to be certified to the
Buyer at no additional cost to the Seller.
8.36 CareMatrix Net Worth. CareMatrix shall maintain a Tangible Net
Worth of not less than FIFTY MILLION DOLLARS ($50,000,000); provided, however,
that any failure by CareMatrix to maintain such a Tangible Net Worth shall not
constitute a default hereunder unless in connection with any Closing (a) any
Landlord or Future Lender requires that CareMatrix maintain such a Tangible Net
Worth and refuses to sign any applicable Lease Assignment and Assumption
Documents or Loan Assignment and Assumption Documents solely because of any
failure by CareMatrix to have a Tangible Net Worth of not less than FIFTY
MILLION DOLLARS ($50,000,000) as of the applicable Closing Date and (b) the only
Closing Condition that is not satisfied in accordance with the terms hereof is
such Landlord's or Future Lender's refusal to sign any applicable Lease
Assignment and Assumption Documents or Loan Assignment and Assumption Documents
solely because of any failure by CareMatrix to have a Tangible Net Worth of not
less than FIFTY MILLION DOLLARS ($50,000,000) as of the applicable Closing Date.
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8.37 Naples Abutters. All sums owed to the Seller under the Naples
Joint Access Agreement shall remain the property of the Seller and the right to
receive any such sums shall not be conveyed to the Buyer.
8.38 Architect's. Subject to any applicable Legal Requirements, the
Buyer has approved of the architectural firms Architecture, Inc. and
Architecture Concepts, Inc. for use in designing any Project Plans that have not
yet been submitted to the Buyer for review and approval.
8.39 Buyer Approvals. Except as may be otherwise expressly provided
herein, the Buyer agrees to review all of the matters referred to in Section
11.7(a), Section 11.8(a), Section 11.9(a) and (b) and Section 11.10(a) and (b)
within thirty (30) days after the Buyer has received all materials and
information as Buyer may deem reasonably necessary to review such matters. Any
failure by the Buyer to notify the Seller whether the Buyer approves of such
matter during the requisite time period shall be deemed to be an approval of the
same.
9. Closing Deliveries. On the Closing Date, subject to the performance by
the Buyer of its obligations hereunder (which may be waived by the Seller), the
Seller shall deliver to the Buyer the following:
9.1 Closing Deliveries Relating to All Closings.
(a) standard affidavits and indemnities duly executed by the Seller
regarding mechanics liens and parties in possession addressed to and in form and
substance acceptable to the applicable Title Insurance Company in order that
such Title Insurance Company will issue the Buyer (or, if applicable, the Single
Purpose Entity acquired by the Buyer) the applicable Buyer's Title Insurance
Policy without exception for mechanics' liens or the rights of parties in
possession other than the rights of the Residents, as residents only, under the
Resident Agreements;
(b) a Closing Certification duly executed by the Seller, in the form
of EXHIBIT M attached hereto, certifying that, subject to Section 10.2 and the
first paragraph of Section 6 of this Agreement, all the representations,
warranties and covenants made by the Seller in this Agreement are true and
complete as of the Closing Date;
(c) a then current rent roll certified by the Seller as of the Closing
Date as true, complete and accurate in all respects, which shall include such
information for each of the Leases relating to the Facility, the Tenants of the
Facility and the Residents of the Facility as is reasonably acceptable to the
Buyer (the "Rent Roll");
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(d) a letter, in form and substance acceptable to the Buyer, addressed
to each of the Residents under the Resident Agreements relating to the
applicable Facility advising of the change in leasing and operation of the
applicable Facility and directing that all Rents becoming due after the Closing
Date pursuant to such Resident Agreements be paid to or at the direction of the
Buyer;
(e) all keys to the applicable Facility held by the Seller or by any
of its agents;
(f) to the extent not already delivered by the Seller, originals of
all of the applicable Leases, Lease Documents or Future Financing Documents,
Assumed Operating Agreements and Permits, including, without limitation, the CO
relating to such Facility;
(g) any applicable Lease Assignment and Assumption Documents or Loan
Assignment and Assumption Documents, which documents shall provide an
unconditional release of the Seller, the Seller's Affiliates, ▇▇▇▇▇▇ and
▇▇▇▇▇▇'▇ Affiliates from all obligations first arising after the applicable
Closing;
(h) evidence of the authority of the Seller, the General Partner and
any applicable Single Purpose Entity to execute and deliver the applicable
Seller Documents in order to effectuate the applicable Closing; and
(i) such other documents and instruments as reasonably may be required
by the Buyer, the Buyer's counsel and the Title Insurance Company, or any of
them, in order to effectuate the applicable Closing.
9.2 Closing Deliveries In Connection with Any Closing Relating to any
Facility Leased By the Seller.
(a) a duly executed assignment and assumption of the applicable
Facility Lease and related Lease Documents (each, an "Assignment and Assumption
Agreement Regarding Lease Documents"), executed by and among the Seller, the
Buyer and the applicable Landlord, conveying good and clear record and
marketable leasehold title to the applicable portion of the Real Property upon
which the applicable Facility is located and the Seller's interest in such Lease
Documents, free from all Liens except: (i) such ad valorem real estate taxes and
assessments for the then current fiscal year as are not due and payable as of
the Closing Date, (ii) the Liens created by Lease Documents and (iii) the
Permitted Encumbrances related to such portion of the Real Property;
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(b) a ▇▇▇▇ of Sale duly executed by the Seller, in substantially the
same form as is attached hereto as EXHIBIT P (each, a "▇▇▇▇ of Sale") conveying
any and all Tangible Personal Property pertaining to the applicable Facility to
the Buyer or the Nominee;
(c) a General Assignment duly executed by the Seller, in substantially
the same form attached hereto as EXHIBIT Q (each, a "General Assignment") and
incorporated herein by reference, assigning, setting over and transferring to
the Buyer, or the Nominee, all of the Seller's right, title and interest in and
to Intangible Personal Property pertaining to the applicable Facility other than
the applicable Governmental Approvals (as defined therein), Leases, Lease
Documents and Operating Agreements;
(d) an Assignment and Assumption Agreement duly executed by the Seller
and the Buyer, in substantially the same form attached hereto as EXHIBIT R,
(each, an "Assignment and Assumption Agreement") assigning, setting over and
transferring to the Buyer all of the Seller's right, title and interest in and
to the applicable Assumed Operating Agreements (for which all necessary consents
have been obtained), Leases (other than any applicable Facility Lease) and
Governmental Approvals (as defined therein); and
(e) a license agreement duly executed by the Seller, in form and
substance reasonably acceptable to the Buyer, pursuant to which, for nominal
consideration, the Buyer shall be licensed to use, in connection with the
operation of the applicable Facility, the then current trade names and
trademarks of such Facility.
9.3 Closing Deliveries in Connection With Any Closing Relating to Any
Facility Leased or Owned by Any Single Purpose Entity.
(a) an assignment and assumption agreement duly executed by the Seller
and the Buyer, in substantially the same for attached hereto as EXHIBIT S,
conveying good and clear title to all of the outstanding membership interests in
the Single Purpose Entity (each, a "Membership Assignment"), free from all Liens
except Liens created by any applicable Lease Documents or Future Financing
Documents;
(b) the original LLC Agreement and the certificate of organization of
the LLC and any and all amendments thereto in effect on the applicable Closing
Date;
(c) a certificate of legal existence or similar certificate from the
state of Delaware for the Single Purpose Entity;
(d) a foreign qualification certificate issued by the State in which
the Facility owned or leased by the Single Purpose Entity is located; and
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(e) an Assignment and Assumption Agreement relating to the applicable
Assumed Operating Agreements, but, appropriately modified to reflect the fact
that such Assumed Operating Agreements will be assigned by the applicable former
Manager to the Single Purpose Entity acquired by the Buyer.
9.4 Closing Deliveries In Connection With Any Closing Relating to Any
Facility Owned By The Seller.
(a) a duly executed good and sufficient warranty deed from the Seller,
in form and substance satisfactory to the Buyer's counsel, conveying good and
clear record and marketable title to the applicable portion of the Real Property
upon which the applicable Facility is located, free from all Liens except: (i)
such ad valorem real estate taxes and assessments for the then current fiscal
year as are not due and payable as of the Closing Date, (ii) the Liens created
by the applicable Future Financing Documents and (iii) the Permitted
Encumbrances related to such portion of the Real Property;
(b) a duly executed affidavit from the Seller stating that the Seller
is not a "Foreign Person" under the Foreign Investment in Real Property Tax Act
of 1980, in form and substance reasonably satisfactory to the Buyer's counsel
and otherwise in compliance with the Internal Revenue Code of 1986, as amended
from time to time;
(c) Form 1099 duly executed by the Seller to be filed with the
Internal Revenue Service;
(d) a duly executed assignment and assumption of the applicable Future
Financing Documents (each, an "Assignment and Assumption Agreement Regarding
Loan Documents"), executed by and among the Seller, the applicable Future Lender
and the Buyer, assigning all of the Seller's right, title and interest in the
Future Financing Documents to the Buyer;
(e) a ▇▇▇▇ of Sale;
(f) a General Assignment;
(g) an Assignment and Assumption Agreement; and
(h) a license agreement duly executed by the Seller, in form and
substance reasonably acceptable to the Buyer, pursuant to which, for nominal
consideration, the Buyer shall be licensed to use, in connection with the
operation of the applicable Facility, the then current trade names and
trademarks of such Facility.
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9.5 Additional Closing Deliveries Relating to the Naples Closing.
a. Omnibus Letter Agreement. The Seller shall deliver to the Buyer
(or, if applicable, the Single Purpose Entity acquired by the Buyer at the
Naples Closing) an assignment of all of its right, title and interest (as
successor-in-interest to Liberty Health Care) in the Omnibus Letter Agreement
pertaining to the Naples Plans and Specifications, which assignment shall be in
form and substance reasonably acceptable to the Buyer. In addition, the Seller
shall use best efforts to obtain (and deliver at the Naples Closing) a consent
by the applicable Architect to such assignment, which consent shall be in form
and substance reasonably acceptable to the Buyer.
b. Assignment of Naples Construction Contract. The Seller shall
deliver to the Buyer (or, if applicable, the Single Purpose Entity acquired by
the Buyer at the Naples Closing) an assignment of all of its right, title and
interest in the Naples Construction Contract, which assignment shall be in form
and substance reasonably acceptable to the Buyer. In addition, the Seller shall
use best efforts to obtain (and deliver at the Naples Closing) a consent by the
applicable General Contractor to such assignment, which consent shall be in form
and substance reasonably acceptable to the Buyer.
9.6 Additional Closing Deliveries Relating to the Carmel Closing.
a. Estoppel Certificate. The Seller shall use best efforts to obtain
and deliver to the Buyer an estoppel certificate, in form and substance
reasonably satisfactory to the Buyer, from the declarant or owner's association
under the Carmel Declaration certifying that there are no unpaid expenses, fees
or assessments arising or accruing under the Carmel Declaration for any period
through the date of the Carmel Closing.
b. Satisfaction of Certain Assessments. The Seller shall deliver to
the Buyer evidence reasonably satisfactory to the Buyer that there are no
assessments relating to the repair and maintenance of ▇.▇. ▇▇▇▇▇▇ Legal Drain
(the non-payment of which could result in a Lien on the Carmel Real Property).
c. Omnibus Letter Agreement. The Seller shall deliver to the Buyer
(or, if applicable, the Single Purpose Entity acquired by the Buyer at the
Carmel Closing) an assignment of all of its right, title and interest (as
successor-in-interest to Liberty Health Care) in the Omnibus Letter Agreement
pertaining to the Carmel Plans and Specifications, which assignment shall be in
form and substance reasonably acceptable to the Buyer. In addition, the Seller
shall use best efforts to obtain (and deliver at the Carmel Closing) a consent
by the applicable Architect to such assignment, which consent shall be in form
and substance reasonably acceptable to the Buyer.
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d. Assignment of Carmel Construction Contract. The Seller shall
deliver to the Buyer (or, if applicable, the Single Purpose Entity acquired by
the Buyer at the Carmel Closing) an assignment of all of its right, title and
interest in the Carmel Construction Contract, which assignment shall be in form
and substance reasonably acceptable to the Buyer. In addition, the Seller shall
use best efforts to obtain (and deliver at the Carmel Closing) a consent by the
applicable General Contractor to such assignment, which consent shall be in form
and substance reasonably acceptable to the Buyer.
9.7 Additional Closing Deliveries Relating to the Dublin Closing.
a. Omnibus Letter Agreement. The Seller shall deliver to the Buyer
(or, if applicable, the Single Purpose Entity acquired by the Buyer at the
Dublin Closing) an assignment of all of its right, title and interest (as
successor-in-interest to Liberty Health Care) in the Omnibus Letter Agreement
pertaining to the Dublin Plans and Specifications, which assignment shall be in
form and substance reasonably acceptable to the Buyer. In addition, the Seller
shall use best efforts to obtain (and deliver at the Dublin Closing) a consent
by the applicable Architect to such assignment, which consent shall be in form
and substance reasonably acceptable to the Buyer.
b. Assignment of Dublin Construction Contract. The Seller shall
deliver to the Buyer (or, if applicable, the Single Purpose Entity acquired by
the Buyer at the Dublin Closing) an assignment of all of its right, title and
interest in the Dublin Construction Contract, which assignment shall be in form
and substance reasonably acceptable to the Buyer. In addition, the Seller shall
use best efforts to obtain (and deliver at the Dublin Closing) a consent by the
applicable General Contractor to such assignment, which consent shall be in form
and substance reasonably acceptable to the Buyer.
9.8 Additional Closing Deliveries Relating to the Germantown Closing.
a. Vacation of Germantown Utility Easement. The Seller shall deliver
to the Buyer evidence reasonably acceptable to the Buyer that those certain
utility improvements located on the Germantown Real Property within the boundary
lines of the Germantown Utility Easement were removed and that the Germantown
Utility Easement has been vacated and terminated of record.
b. Omnibus Letter Agreement. The Seller shall deliver to the Buyer
(or, if applicable, the Single Purpose Entity acquired by the Buyer at the
Germantown Closing) an assignment of all of its right, title and interest (as
successor-in-interest to Liberty Health Care) in the Omnibus Letter Agreement
pertaining to the Germantown Plans and Specifications, which assignment shall be
in form and substance reasonably acceptable to the Buyer. In
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addition, the Seller shall use best efforts to obtain (and deliver at the
Germantown Closing) a consent by the applicable Architect to such assignment,
which consent shall be in form and substance reasonably acceptable to the Buyer.
c. Assignment of Germantown Construction Contract. The Seller shall
deliver to the Buyer (or, if applicable, the Single Purpose Entity acquired by
the Buyer at the Germantown Closing) an assignment of all of its right, title
and interest in the Germantown Construction Contract, which assignment shall be
in form and substance reasonably acceptable to the Buyer. In addition, the
Seller shall use best efforts to obtain (and deliver at the Germantown Closing)
a consent by the applicable Architect to such assignment, which consent shall be
in form and substance reasonably acceptable to the Buyer.
9.9 Additional Closing Deliveries Relating to the Birmingham Closing.
a. Birmingham Declaration. The Seller shall deliver to the Buyer (a) a
certificate from the Architectural Control Committee established under the
Birmingham Declaration, in form and substance acceptable to the Buyer, verifying
that the Birmingham Plans and Specifications and the construction of the
Birmingham Facility in accordance therewith have been approved by such
Architectural Control Committee and (b) an estoppel certificate from the owners'
association created under the Birmingham Declaration, in form and substance
acceptable to the Buyer.
b. Omnibus Letter Agreement. The Seller shall deliver to the Buyer
(or, if applicable, the Single Purpose Entity acquired by the Buyer at the
Birmingham Closing) an assignment of all of its right, title and interest (as
successor-in-interest to Liberty Health Care) in the Omnibus Letter Agreement
pertaining to the Birmingham Plans and Specifications, which assignment shall be
in form and substance reasonably acceptable to the Buyer. In addition, the
Seller shall use best efforts to obtain (and deliver at the Birmingham Closing)
a consent by the applicable Architect to such assignment, which consent shall be
in form and substance reasonably acceptable to the Buyer.
c. Assignment of Birmingham Construction Contract. The Seller shall
deliver to the Buyer (or, if applicable, the Single Purpose Entity acquired by
the Buyer at the Birmingham Closing) an assignment of all of its right, title
and interest in the Birmingham Construction Contract, which assignment shall be
in form and substance reasonably acceptable to the Buyer. In addition, the
Seller shall use best efforts to obtain (and deliver at the Birmingham Closing)
a consent by the applicable General Contractor to such assignment, which consent
shall be in form and substance reasonably acceptable to the Buyer.
9.10 Additional Closing Deliveries Relating to the Overland Park
Closing.
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a. Omnibus Letter Agreement. The Seller shall deliver to the Buyer
(or, if applicable, the Single Purpose Entity acquired by the Buyer at the
Overland Park Closing) an assignment of all of its right, title and interest (as
successor-in-interest to Liberty Health Care) in the Omnibus Letter Agreement
pertaining to the Overland Park Plans and Specifications, which assignment shall
be in form and substance reasonably acceptable to the Buyer. In addition, the
Seller shall use best efforts to obtain (and deliver at the Overland Park
Closing) a consent by the applicable Architect to such assignment, which consent
shall be in form and substance reasonably acceptable to the Buyer.
b. Assignment of Overland Park Construction Contract. The Seller shall
deliver to the Buyer (or, if applicable, the Single Purpose Entity acquired by
the Buyer at the Overland Park Closing) an assignment of all of its right, title
and interest in the Overland Park Construction Contract, which assignment shall
be in form and substance reasonably acceptable to the Buyer. In addition, the
Seller shall use best efforts to obtain (and deliver at the Overland Park
Closing) a consent by the applicable Architect to such assignment, which consent
shall be in form and substance reasonably acceptable to the Buyer.
9.11 Additional Closing Deliveries Relating to the Hockessin Closing.
a. Omnibus Letter Agreement. The Seller shall deliver to the Buyer
(or, if applicable, the Single Purpose Entity acquired by the Buyer at the
Hockessin Closing) an assignment of all of its right, title and interest (as
successor-in-interest to Liberty Health Care) in the Omnibus Letter Agreement
pertaining to the Hockessin Plans and Specifications, which assignment shall be
in form and substance reasonably acceptable to the Buyer. In addition, the
Seller shall use best efforts to obtain (and deliver at the Hockessin Closing) a
consent by the applicable Architect to such assignment, which consent shall be
in form and substance reasonably acceptable to the Buyer.
b. Assignment of Hockessin Construction Contract. The Seller shall
deliver to the Buyer (or, if applicable, the Single Purpose Entity acquired by
the Buyer at the Hockessin Closing) an assignment of all of its right, title and
interest in the Hockessin Construction Contract, which assignment shall be in
form and substance reasonably acceptable to the Buyer. In addition, the Seller
shall use best efforts to obtain (and deliver at the Hockessin Closing) a
consent by the applicable Architect to such assignment, which consent shall be
in form and substance reasonably acceptable to the Buyer.
9.12 Additional Closing Deliveries Relating to the Blue ▇▇▇▇ Closing.
a. Assignment of Blue ▇▇▇▇ Architect's Agreement. The Seller shall
deliver to the Buyer (or, if applicable, the Single Purpose Entity acquired by
the Buyer at the
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Blue ▇▇▇▇ Closing) an assignment of all of its right, title and interest in the
Blue ▇▇▇▇ Architect's Agreement, which assignment shall be in form and substance
reasonably acceptable to the Buyer. In addition, the Seller shall use best
efforts to obtain (and deliver at the Blue ▇▇▇▇ Closing) a consent by the
applicable Architect to such assignment, which consent shall be in form and
substance reasonably acceptable to the Buyer.
b. Assignment of Blue ▇▇▇▇ Construction Contract. The Seller shall
deliver to the Buyer (or, if applicable, the Single Purpose Entity acquired by
the Buyer at the Blue ▇▇▇▇ Closing) an assignment of all of its right, title and
interest in the Blue ▇▇▇▇ Construction Contract, which assignment shall be in
form and substance reasonably acceptable to the Buyer. In addition, the Seller
shall use best efforts to obtain (and deliver at the Blue ▇▇▇▇ Closing) a
consent by the applicable General Contractor to such assignment, which consent
shall be in form and substance reasonably acceptable to the Buyer.
9.13 Additional Closing Deliveries Relating to the Richmond Closing.
a. Assignment of Richmond Architect's Agreement. The Seller shall
deliver to the Buyer (or, if applicable, the Single Purpose Entity acquired by
the Buyer at the Richmond Closing) an assignment of all of its right, title and
interest in the Richmond Architect's Agreement, which assignment shall be in
form and substance reasonably acceptable to the Buyer. In addition, the Seller
shall use best efforts to obtain (and deliver at the Richmond Closing) a consent
by the applicable Architect to such assignment, which consent shall be in form
and substance reasonably acceptable to the Buyer.
b. Assignment of Richmond Construction Contract. The Seller shall
deliver to the Buyer (or, if applicable, the Single Purpose Entity acquired by
the Buyer at the Richmond Closing) an assignment of all of its right, title and
interest in the Richmond Construction Contract, which assignment shall be in
form and substance reasonably acceptable to the Buyer. In addition, the Seller
shall use best efforts to obtain (and deliver at the Richmond Closing) a consent
by the applicable General Contractor to such assignment, which consent shall be
in form and substance reasonably acceptable to the Buyer.
9.14 Additional Closing Deliveries Relating to the ▇▇▇▇▇▇▇▇▇▇ Closing.
a. Assignment of ▇▇▇▇▇▇▇▇▇▇ Architect's Agreement. The Seller shall
deliver to the Buyer (or, if applicable, the Single Purpose Entity acquired by
the Buyer at the ▇▇▇▇▇▇▇▇▇▇ Closing) an assignment of all of its right, title
and interest in the ▇▇▇▇▇▇▇▇▇▇ Architect's Agreement, which assignment shall be
in form and substance reasonably acceptable to the Buyer. In addition, the
Seller shall use best efforts to obtain (and deliver at the
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▇▇▇▇▇▇▇▇▇▇ Closing) a consent by the applicable Architect to such assignment,
which consent shall be in form and substance reasonably acceptable to the Buyer.
b. Assignment of ▇▇▇▇▇▇▇▇▇▇ Construction Contract. The Seller shall
deliver to the Buyer (or, if applicable, the Single Purpose Entity acquired by
the Buyer at the ▇▇▇▇▇▇▇▇▇▇ Closing) an assignment of all of its right, title
and interest in the ▇▇▇▇▇▇▇▇▇▇ Construction Contract, which assignment shall be
in form and substance reasonably acceptable to the Buyer. In addition, the
Seller shall use best efforts to obtain (and deliver at the ▇▇▇▇▇▇▇▇▇▇ Closing)
a consent by the applicable Architect to such assignment, which consent shall be
in form and substance reasonably acceptable to the Buyer.
9.15 Additional Closing Deliveries Relating to the West Bloomfield
Hills Closing.
a. Assignment of West Bloomfield Hills Architect's Agreement. The
Seller shall deliver to the Buyer (or, if applicable, the Single Purpose Entity
acquired by the Buyer at the West Bloomfield Hills Closing) an assignment of all
of its right, title and interest in the West Bloomfield Hills Architect's
Agreement, which assignment shall be in form and substance reasonably acceptable
to the Buyer. In addition, the Seller shall use best efforts to obtain (and
deliver at the West Bloomfield Hills Closing) a consent by the applicable
Architect to such assignment, which consent shall be in form and substance
reasonably acceptable to the Buyer.
b. Assignment of West Bloomfield Hills Construction Contract. The
Seller shall deliver to the Buyer (or, if applicable, the Single Purpose Entity
acquired by the Buyer at the West Bloomfield Hills Closing) an assignment of all
of its right, title and interest in the West Bloomfield Hills Construction
Contract, which assignment shall be in form and substance reasonably acceptable
to the Buyer. In addition, the Seller shall use best efforts to obtain (and
deliver at the West Bloomfield Hills Closing) a consent by the applicable
General Contractor to such assignment, which consent shall be in form and
substance reasonably acceptable to the Buyer
10. Conditions Precedent to All Closings. The following shall be conditions
precedent to Buyer's obligation to consummate each Closing; provided, however,
the Buyer shall have the right, but not the obligation, to waive any conditions
precedent to the Buyer's obligation to consummate such Closing despite the
non-performance of such conditions precedent by delivering written notice
thereof to the Seller (it being understood, however, that the waiver of any
particular condition precedent shall not constitute a waiver of any other
condition precedent):
10.1 Buyer's Transfer Approvals. The Buyer shall have received all
necessary Buyer's Transfer Approvals, so that
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upon the consummation of the applicable Closing, the Buyer (a) may acquire the
Seller's interest in the applicable Facility and the portion of the Property
related thereto and may operate such Facility for its Primary Intended Use in
accordance with all applicable Legal Requirements or (b) may acquire the equity
interests in the applicable Single Purpose Entity and such Single Purpose Entity
may continue to operate the applicable Facility for its Primary Intended Use in
accordance with all applicable Legal Requirements.
10.2 Representations, Warranties and Covenants. Notwithstanding
anything to the contrary set forth herein, all of the covenants and agreements
made by the Seller in this Agreement shall have been fully and timely performed,
in all material respects, and the Buyer shall have received a Closing
Certification, dated as of the applicable Closing Date, acceptable to the Buyer
in all material respects.
10.3 Physical Condition of the Facility. The Seller shall have
completed the construction of the applicable Facility in accordance with this
Agreement and substantially and in all material respects in accordance with the
applicable Project Plans and Development Agreement relating thereto. The Seller
shall have maintained such Facility in good order and repair, reasonable wear
and tear excepted; provided, however, no portion of the Facility or any portion
of the Property related thereto shall have been damaged by any Casualty that has
not been fully repaired in accordance with the terms hereof.
10.4 Environmental Condition. The environmental condition of the
Facility (and the portion of the Property related thereto) shall be
substantially the same on the Closing Date as is reflected in the applicable
Environmental Report and the Facility (and the applicable portion of the
Property related thereto) shall be in compliance, in all material respects, with
all Applicable Environmental Laws.
10.5 Operating Agreements. The Seller shall have terminated all of the
Operating Agreements required to be terminated under Section 8.17 and shall have
deliver evidence of such termination reasonably satisfactory to the Buyer. The
Buyer shall have received the written consent of all parties to all applicable
Assumed Operating Agreements whose consent to the assignment thereof from the
Seller (or the applicable Single Purpose Entity) to the Buyer is required
pursuant to the terms thereof.
10.6 Possession. Full possession of the applicable Facility and the
portion of the Property related thereto, free from all tenants and occupants
other than the Tenants under Leases approved by the Buyer in accordance with the
terms hereof and Residents, as tenants only, shall be delivered to the Buyer at
the Closing.
10.7 Buyer's Title Insurance Policies. The Buyer (or, if the Closing
involves the acquisition of the equity interests in any
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Single Purpose Entity, then such Single Purpose Entity) shall have been issued
the applicable Buyer's Title Insurance Policy relating to the applicable
Facility and the portion of the Property relating thereto. The Buyer shall pay
all costs incurred in obtaining the Buyer's Title Insurance Policies.
10.8 Lease Documents and Future Financing Documents. The Seller and
the applicable Landlord or Future Lender shall have executed and delivered to
the Buyer, the applicable Title Insurance Company and the applicable Landlord or
Future Lender's title insurer, if any, all of the applicable Lease Assignment
and Assumption Documents or Loan Assignment and Assumption Documents, each of
which shall be in form and substance satisfactory to the Buyer in the Buyer's
sole and absolute discretion. Without limiting the foregoing, the applicable
Landlord or Future Lender shall have consented to the transfer of the Seller's
or the applicable Single Purpose Entity's interest in the applicable portion of
the Property to the Buyer, the Buyer's assumption of the applicable Lease
Documents or Future Financing Documents and the CareMatrix Amendments.
10.9 Lease Default or Future Financing Default. Without limiting any
other provision set forth herein, (a) no Lease Default under any Lease Documents
relating to the applicable Facility shall have occurred that remains uncured (or
which has not been waived by the applicable Landlord, provided, that, the terms
and conditions of such waiver are acceptable to the Buyer) as of the applicable
Closing Date nor shall any event have occurred as of the applicable Closing Date
which with notice and/or the passage of time could constitute a Lease Default
and (b) no Future Financing Default under any Future Financing Documents
relating to the applicable Facility shall have occurred that remains uncured (or
which has not been waived by the applicable Future Lender, provided, that, the
terms and conditions of such waiver are acceptable to the Buyer) as of the
applicable Closing Date nor shall any event have occurred as of the applicable
Closing Date which, with notice and/or the passage of time could constitute a
Future Financing Default.
10.10 HSR Act. All applicable waiting periods under the
HSR Act shall have expired or early termination shall have been granted by both
the Federal Trade Commission and the United States Department of Justice.
10.11 Condemnation. No Condemnation or similar proceeding shall be
pending or shall have been completed with respect to or affecting the applicable
Facility and the portion of the Property related thereto which could prevent the
Facility from being operated for its Primary Intended Use in accordance with all
applicable Legal Requirements or which, in the Buyer's good faith determination,
could have a material adverse effect on the operation or financial condition of
the Facility.
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10.12 Non-Competition Agreement. The Buyer shall have received a
Non-Competition Agreement from any Principal as of the applicable Closing Date;
provided, however, that in lieu of receiving a Non-Competition Agreement from
the ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, ▇▇. 1996 Irrevocable Trust the Buyer shall have received a
Non-Competition Agreement from the Beneficiaries (which will include a covenant
that the Beneficiaries shall cause the ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, ▇▇. 1996 Irrevocable
Trust to comply with the provisions of such Non-Competition Agreement as if it
were a party thereto).
10.13 Dispute Regarding the Seller's Calculation of the Facility
Purchase Price or the Achievement of Breakeven. In the event that the Buyer has
sent a notice of objection to the Seller's calculation of any Facility Purchase
Price and/or whether the applicable Facility or Facilities achieved Breakeven
for three (3) consecutive months, such objection shall have been resolved in
accordance with the provisions of Section 4 hereof.
10.14 Survey Matters. The applicable as-built survey delivered to the
Buyer pursuant to Section 8.12 (h) hereof or any other current as-built survey
of the applicable Facility (and the applicable portion of the Property relating
thereto) obtained by the Buyer shall not disclose any encroachments or other
matters that were not previously approved by the Buyer. The Seller acknowledges
that the Buyer has not approved of any encroachments of any improvements located
on the Property over any Permitted Encumbrances.
10.15 License of Intellectual Property. As of the applicable Closing
Date involving either: (a) the acquisition of all of the equity interest in any
Single Purpose Entity by the Buyer pursuant to this Agreement, or (b) the
Buyer's acquisition of any Facility and the applicable portion of the Property
relating thereto; then, Seller shall license either the Single Purpose Entity or
the Buyer (whichever party may be appropriate depending on the particular
transaction), pursuant to an agreement in form and substance reasonably
acceptable to the Buyer, the right to use all (if any) Intellectual Property
that is necessary for the construction, development, management and/or operation
of the Facility operated by either said Single Purpose Entity or the Buyer, in
accordance with the Primary Intended Use of the Facility.
11. Additional Conditions Precedent to Specific Closings. In addition to
the conditions precedent to the Buyer's obligation to consummate any Closing as
set forth in Section 10 hereof, the following shall be conditions precedent to
Buyer's obligation to consummate each Closing as specified below; provided,
however, the Buyer shall have the right, but not the obligation, to waive any
conditions precedent to the Buyer's obligation to consummate such Closing
despite the non-performance of such conditions precedent by delivering written
notice thereof to the Seller
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(it being understood, however, that the waiver of any particular condition
precedent shall not constitute a waiver of any other condition precedent):
11.1 Conditions Precedent to the Naples Closing.
a. Approved Site Plan. At least fifteen (15) days prior to the Naples
Closing, the Seller shall have delivered to the Buyer a true and complete copy
of the final site plan relating to the Naples Property approved by all required
Governmental Authorities and such final approved site plan shall be acceptable
to Buyer.
b. Title Matters. The Buyer's Title Insurance Policy issued at the
Naples Closing, shall in a manner reasonably acceptable to the Buyer (i) address
the matters referred to in that certain letter dated July 13, 1998 from ▇▇▇▇▇▇
▇▇▇▇▇▇ to ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ and (ii) provide insurance to the Buyer (and agree
to provide such insurance in the future) that no Person other than NHP (or its
successors in interest) holds any interest in the fee title to the Naples Real
Property.
11.2 Conditions Precedent to the Carmel Closing.
a. Amendment to Carmel Facility Lease. At least fifteen (15) days
prior to the Carmel Closing, without limiting any other provision set forth
herein, the Carmel Lease shall have been amended to correct Section 4.3 thereof
to provide that Additional Rent (as defined therein) should commence on the
first day of the third lease year.
b. Lease Assignment and Assumption Documents. The Lease Assignment and
Assumption Documents relating to the Carmel Facility shall amend the
non-competition provision set forth in the Carmel Lease to allow the
development, management and operation of one assisted living facility by
CareMatrix or any of its Affiliates within a five-mile radius of the Carmel
Facility.
c. Carmel As-Built Survey. At least fifteen (15) days prior to the
Carmel Closing, the Seller shall have delivered to the Buyer an as-built survey
of the Carmel Property (showing all improvements and applicable Permitted
Encumbrances thereon) in form and substance reasonably acceptable to the Buyer.
11.3 Conditions Precedent to the Dublin Closing.
a. Lease Assignment and Assumption Documents. The Lease Assignment and
Assumption Documents relating to the Dublin Facility shall amend the
non-competition provision set forth in the Dublin Lease to allow the
development, management and operation
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of one assisted living facility by CareMatrix or any of its Affiliates within a
five-mile radius of the Dublin Facility.
11.4 Conditions Precedent to the Germantown Closing.
a. Germantown Utility Easement. The Buyer's Title Insurance Policy
relating to the Germantown Real Property shall not take an exception for the
Germantown Utility Easement.
b. Lease Assignment and Assumption Documents. The Lease Assignment and
Assumption Documents relating to the Germantown Facility shall amend the
non-competition provision set forth in the Germantown Lease to allow the
development, management and operation of one assisted living facility by
CareMatrix or any of its Affiliates within a five-mile radius of the Germantown
Facility.
11.5 Conditions Precedent to the Birmingham Closing.
a. Birmingham Declaration. At least fifteen (15) days prior to the
Birmingham Closing, the Seller shall have delivered to the Buyer a true and
complete copy of all amendments to the Birmingham Declaration that are taken as
an exception to the Birmingham Title Policy or the Buyer's Title Insurance
Policy relating to the Birmingham Real Property and the terms and conditions
thereof shall be reasonably acceptable to the Buyer.
b. Buyer's Title Insurance Policy. The Buyer's Title Insurance Policy
issued at the Birmingham Closing will not contain any exceptions relating to
recorded plats other than any exception, similar to the exception currently set
forth in the Birmingham Title Insurance Policy, that relates solely to matters
shown on the plat recorded in Map Book 21, Page 92.
c. Lease Assignment and Assumption Documents. The Lease Assignment and
Assumption Documents to be delivered at the Birmingham Closing shall contain a
representation from HCPI that (i) HCPI has not subdivided the Birmingham Real
Property and does not intend to subdivide the Birmingham Real Property and (ii)
HCPI has no further rights under the Birmingham Lease Documents to require the
Seller (or any of its successors-in-interest) to purchase the Birmingham Real
Property from HCPI.
11.6 Conditions Precedent to the Overland Park Closing.
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a. Lease Assignment and Assumption Documents. The Lease Assignment and
Assumption Documents to be delivered at the Overland Park Closing shall contain
a representation from HCPI that (i) HCPI has not subdivided the Overland Park
Real Property and does not intend to subdivide the Overland Park Real Property
and (ii) HCPI has no further rights under the Overland Park Lease Documents to
require the Seller (or any of its successors-in-interest) to purchase the
Overland Park Real Property from HCPI.
11.7 Conditions Precedent to the Blue ▇▇▇▇ Closing.
a. Buyer's Approvals of Certain Documents and Other Matters. Prior to
the commencement of construction of the Blue ▇▇▇▇ Facility, the Buyer shall have
approved the Blue ▇▇▇▇ Architect's Contract, the Blue ▇▇▇▇ Construction
Contract, the Blue ▇▇▇▇ Plans and Specifications, the Blue ▇▇▇▇ Subdivision
Approvals (including, without limitation, the final subdivision plan pertaining
to the Blue ▇▇▇▇ Real Property), the Blue ▇▇▇▇ Survey, the Blue ▇▇▇▇ Purchase
Documents, the Blue ▇▇▇▇ Title Insurance Commitment (including, without
limitation, all matters taken as exceptions therein), the status of the Blue
▇▇▇▇ Property's compliance with applicable Legal Requirements (including,
without limitation, zoning and other land use matters) and the Future Financing
Documents relating to the Blue ▇▇▇▇ Facility.
b. Non-competition Provision. In the event that the Future Financing
Documents relating to the Blue ▇▇▇▇ Facility contain a non-competition
provision, the applicable Lease Assignment and Assumption Documents or Loan
Assignment and Assumption Documents to be delivered at the Blue ▇▇▇▇ Closing
shall amend such non-competition provision to allow the development, management
and operation of one assisted living facility by CareMatrix or any of its
Affiliates within a five-mile radius of the Blue ▇▇▇▇ Facility.
11.8 Conditions Precedent to the Richmond Closing.
a. Buyer's Approvals of Certain Documents and Other Matters. Prior to
the commencement of construction of the Richmond Facility, the Buyer shall have
approved the Richmond Budget, the Richmond Construction Contract, the Richmond
Plans and Specifications, the Richmond Survey, the Richmond Purchase Documents,
the Richmond Title Insurance Commitment (including, without limitation, all
matters taken as exceptions therein), the status of the Richmond Property's
compliance with applicable Legal Requirements (including, without limitation,
zoning and other land use matters) and the Future Financing Documents relating
to the Richmond Facility.
b. Non-competition Provision. In the event that the Future Financing
Documents relating to the Richmond Facility contain a non-competition provision,
the applicable Lease Assignment and Assumption Documents or Loan Assignment and
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Assumption Documents to be delivered at the Richmond Closing shall amend such
non-competition provision to allow the development, management and operation of
one assisted living facility by CareMatrix or any of its Affiliates within a
five-mile radius of the Richmond Facility.
11.9 Conditions Precedent to ▇▇▇▇▇▇▇▇▇▇ Closing.
a. Buyer's Approvals of Certain Documents and Other Matters. Prior to
the commencement of construction of the ▇▇▇▇▇▇▇▇▇▇ Facility, the Buyer shall
have approved the ▇▇▇▇▇▇▇▇▇▇ Architect's Agreement, the ▇▇▇▇▇▇▇▇▇▇ Budget, the
▇▇▇▇▇▇▇▇▇▇ Construction Contract, the ▇▇▇▇▇▇▇▇▇▇ Plans and Specifications, the
▇▇▇▇▇▇▇▇▇▇ Survey, the ▇▇▇▇▇▇▇▇▇▇ Purchase Documents, the ▇▇▇▇▇▇▇▇▇▇ Title
Insurance Commitment (including, without limitation, all matters taken as
exceptions therein), the status of the ▇▇▇▇▇▇▇▇▇▇ Property's compliance with
applicable Legal Requirements (including, without limitation, zoning and other
land use matters), the ▇▇▇▇▇▇▇▇▇▇ Environmental Report and the Future Financing
Documents relating to the ▇▇▇▇▇▇▇▇▇▇ Facility.
b. Zoning Matters. Without limiting any other provisions set forth
herein, in the event that the construction of the ▇▇▇▇▇▇▇▇▇▇ Facility in
accordance with the ▇▇▇▇▇▇▇▇▇▇ Plans and Specifications and/or the use and
operation of the ▇▇▇▇▇▇▇▇▇▇ Facility in accordance with its Primary Intended Use
is not permitted as of right under the applicable zoning requirements, (i) the
Seller shall obtain all necessary zoning approvals required for the construction
of the ▇▇▇▇▇▇▇▇▇▇ Facility in accordance with the ▇▇▇▇▇▇▇▇▇▇ Plans and
Specifications, the ▇▇▇▇▇▇▇▇▇▇ Development Agreement and this Agreement and/or
the operation of the ▇▇▇▇▇▇▇▇▇▇ Facility in accordance with its Primary Intended
Use and shall deliver true and correct copies of all such zoning approvals to
the Buyer, (ii) as of the ▇▇▇▇▇▇▇▇▇▇ Closing, (x) all of the conditions,
restrictions and other limitations set forth in such zoning approvals relating
to the construction and development of the ▇▇▇▇▇▇▇▇▇▇ Facility, as well as all
other applicable zoning requirements relating to the construction and
development of the ▇▇▇▇▇▇▇▇▇▇ Facility shall be fully satisfied, (y) the
operation of the ▇▇▇▇▇▇▇▇▇▇ Facility in accordance with its Primary Intended Use
will not violate such zoning approvals or any other applicable zoning
requirement and (z) all appeal periods relating to the granting of such zoning
approvals shall have expired with no appeals having been filed or all appeals
having been conclusively decided in favor of the owner of the ▇▇▇▇▇▇▇▇▇▇
Property and (iii) such zoning approvals shall run with the land.
c. Non-competition Provision. In the event that the Future Financing
Documents relating to the ▇▇▇▇▇▇▇▇▇▇ Facility contain a non-competition
provision, the applicable Lease Assignment and Assumption Documents or Loan
Assignment and Assumption Documents to be delivered at the ▇▇▇▇▇▇▇▇▇▇ Closing
shall amend such non-competition provision to allow the development, management
and operation of one
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assisted living facility by CareMatrix or any of its Affiliates within a
five-mile radius of the ▇▇▇▇▇▇▇▇▇▇ Facility.
11.10 Conditions Precedent to West Bloomfield Hills Closing.
a. Buyer's Approvals of Certain Documents and Other Matters. Prior to
the commencement of construction of the West Bloomfield Hills Facility, the
Buyer shall have approved the West Bloomfield Hills Architect's Agreement, West
Bloomfield Hills Budget, the West Bloomfield Hills Construction Contract, the
West Bloomfield Hills Plans and Specifications, the West Bloomfield Hills
Survey, the West Bloomfield Hills Purchase Documents, the West Bloomfield Hills
Title Insurance Commitment (including, without limitation, all matters taken as
exceptions therein), the status of the West Bloomfield Hills Property's
compliance with applicable Legal Requirements (including, without limitation,
zoning and other land use matters), the West Bloomfield Hills Environmental
Report and the Future Financing Documents relating to the West Bloomfield Hills
Facility.
b. Zoning Matters. Without limiting any other provisions set forth
herein, in the event that the construction of the West Bloomfield Hills Facility
in accordance with the West Bloomfield Hills Plans and Specifications and/or the
use and operation of the West Bloomfield Hills Facility in accordance with its
Primary Intended Use is not permitted as of right under the applicable zoning
requirements, (i) the Seller shall obtain all necessary zoning approvals
required for the construction of the West Bloomfield Hills Facility in
accordance with the West Bloomfield Hills Plans and Specifications, the West
Bloomfield Hills Development Agreement and this Agreement and/or the operation
of the West Bloomfield Hills Facility in accordance with its Primary Intended
Use and shall deliver true and correct copies of all such zoning approvals to
the Buyer, (ii) as of the West Bloomfield Hills Closing, (x) all of the
conditions, restrictions and other limitations set forth in such zoning
approvals relating to the construction and development of the West Bloomfield
Hills Facility, as well as all other applicable zoning requirements relating to
the construction and development of the West Bloomfield Hills Facility shall be
fully satisfied, (y) the operation of the West Bloomfield Hills Facility in
accordance with its Primary Intended Use will not violate such zoning approvals
or any other applicable zoning requirement and (z) all appeal periods relating
to the granting of such zoning approvals shall have expired with no appeals
having been filed or all appeals having been conclusively decided in favor of
the owner of the West Bloomfield Hills Property and (iii) such zoning approvals
shall run with the land.
c. Non-competition Provision. In the event that the Future Financing
Documents relating to the West Bloomfield Hills Facility contain a
non-competition provision, the applicable Lease Assignment and Assumption
Documents or Loan Assignment and Assumption Documents to be delivered at the
West Bloomfield Hills Closing shall amend such non-competition provision to
allow the development, management and operation of one
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assisted living facility by CareMatrix or any of its Affiliates within a
five-mile radius of the West Bloomfield Hills Facility.
12. Extensions. If the Seller shall be unable to give title to or to make
the assignment or other transfer of the Seller's interest in any Facility (and
the applicable portion of the Property relating thereto), or, if applicable, the
equity interests in the Single Purpose Entity that leases (or owns) such
Facility, or to deliver possession of such Facility (and the applicable portion
of the Property relating thereto), all as herein stipulated, or if at the time
of applicable Closing, the condition of such Facility (and the applicable
portion of the Property relating thereto) or any applicable Single Purpose
Entity does not conform with the provisions hereof, or if all of the applicable
Closing Conditions precedent to the Buyer's obligation to consummate such
Closing shall not have been satisfied by the applicable Closing Date, the Buyer
shall so notify the Seller on or prior to the date originally set forth in the
applicable Election Notice as such Closing Date; whereupon, in order to allow
the Seller to so perform or for such Closing Conditions to be satisfied, such
Closing Date shall be extended for a period not to exceed one hundred eighty
(180) days, but, in no event beyond the Termination Date (unless, in the event
of a Casualty or Condemnation, the Buyer elects to extend such Closing Date
beyond the Termination Date in order to allow the Seller sufficient time to
comply with the provisions of Section 8.22 and 8.23 hereof). During such
extended period of time, the Seller shall use diligent efforts to remove any
defects in title, or to make the applicable Facility (and the applicable portion
of the Property relating thereto) conform with the provisions hereof, or to
cause such Closing Conditions to be satisfied. In the event that, as of such
original Closing Date, the Buyer has been unable to obtain the applicable
Buyer's Transfer Approvals, then, during such extended period of time, the Buyer
shall use diligent efforts to obtain the applicable Buyer's Transfer Approvals.
The Buyer shall have the election at either the original or extended
time for performance, to accept such title to the applicable Facility (and the
applicable portion of the Property relating thereto) or, if applicable, the
Single Purpose Entity that leases (or owns) such Facility, as the Seller can
deliver (in its then condition) and to pay therefor the applicable Facility
Purchase Price without deduction, in which case, the Seller shall convey such
title, except that (a) if the Facility (or any portion of the Property relating
thereto) shall be damaged by any insured Casualty, then subject to the terms and
conditions under any applicable Lease Documents or Future Financing Documents
assumed by the Buyer at the applicable Closing, the Seller shall pay over or
assign to the Buyer, at the applicable Closing, all amounts recovered or
recoverable by the Seller on account of such insurance and (b) if any part of
the Property relating to the applicable Facility has been taken or condemned by
any action of a Governmental Authority or quasi-governmental authority or
damaged by action of any Governmental Authority, then subject to the terms and
conditions under any applicable Lease Documents or Future Financing Documents
assumed by the Buyer at the applicable Closing, the Seller shall pay over or
assign to the Buyer, at such Closing, all damage awards recovered or recoverable
by the Seller for such condemnation or damage.
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If on the Closing Date, as it may be extended hereunder, the Seller, having
used such efforts, is unable to cure said defects or make the Facility (or any
portion of the Property relating thereto) or any Single Purpose Entity conform
to the requirements hereof or if all of the applicable Closing Conditions
precedent to the Buyer's obligations hereunder are not satisfied, then, the
Buyer shall have the right to terminate its prior exercise of the Buyer's Call
Right (or, if applicable, the Seller's prior exercise of its Put Right) relating
to the applicable Facility; in which event, if, without taking into account the
Facility which was to be the subject of the Closing that was not consummated,
(x) two (2) or more Facilities remain the subject of this Agreement, the
Additional Option Payment shall be refunded to the Buyer, (y) one Facility
remains the subject of this Agreement, the Additional Option Payment plus
one-half (1/2) of the Initial Option Payment shall be refunded to the Buyer and
(z) there is no Facility which remains the subject of this Agreement, the
remaining portion of the Total Option Payment that has not previously been
applied to any Facility Purchase Price paid hereunder shall be refunded to the
Buyer. Upon, the refund of the applicable portion of the Total Option Payment to
the Buyer in accordance with the foregoing clauses (x), (y) or (z), the Buyer's
rights and the Seller's obligations with respect to such Facility (and the
applicable portion of the Property relating thereto) and any Single Purpose
Entity that leases (or owns) such Facility shall terminate and neither party
hereto shall have any further rights or remedies hereunder with respect thereto,
except as otherwise specifically provided herein to survive the termination of
this Agreement.
13. Indemnification. Subject to the provisions of Section 18 hereof, the
liability of any party for a breach of any representation, warranty or covenant
in this Agreement will be as set forth in this Section 13. The representations,
warranties and covenants set forth in this Agreement shall survive each Closing
for a period of twelve (12) months whether or not either party relied on such
representations, warranties and covenants or had knowledge, acquired either
before the date hereof, from its own investigation or otherwise of any fact at
variance with or any breach of any such representation, warranty or covenant.
The Buyer and the Seller each hereby agree to indemnify the other and hold it
harmless from and against any and all claims, demands, liabilities, costs,
expenses, penalties, damages and losses which are not covered by insurance
(collectively, "Losses"), including without limitation, reasonable attorneys'
fees and expenses, resulting from (a) any misrepresentation or breach of
warranty or breach of covenant made by such indemnifying party in this Agreement
or in any document, certificate or agreement given or delivered to the other
pursuant to or in connection with this Agreement or (b) the enforcement of this
indemnification agreement. The indemnification provisions in this Section shall
survive each Closing contemplated hereunder or the earlier termination of this
Agreement.
Promptly after receipt by an indemnified party under this Section 13 of
notice of the commencement of any action, such indemnified party will, if a
claim in respect thereof is to be made against the indemnifying party under this
Section 13, notify the indemnifying party in writing of the commencement
thereof; but the omission so to notify the indemnifying party will not relieve
it from any liability which it may have to any indemnified party otherwise than
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under this Section 13. In case any such action is brought against any
indemnified party, and it notifies the indemnifying party of the commencement
thereof, the indemnifying party will be entitled to participate therein, and to
the extent that it may elect by written notice delivered to the indemnified
party promptly after receiving the aforesaid notice from such indemnified party,
to assume the defense thereof, with counsel reasonably satisfactory to such
indemnified party; provided, however, that if the defendants in any such action
include both the indemnified party and the indemnifying party and the
indemnified party shall have reasonably concluded that there may be legal
defenses available to it and/or other indemnified parties which are different
from or additional to those available to the indemnifying party, the indemnified
party or parties shall have the right to select separate counsel to assert such
legal defenses and to otherwise participate in the defense of such action on
behalf of such indemnified party or parties. Upon receipt of notice from the
indemnifying party to such indemnified party of its election so to assume the
defense of such action and approval by the indemnified party of counsel, the
indemnifying party will not be liable to such indemnified party under this
Section 13 for any legal or other expenses subsequently incurred by such
indemnified party in connection with the defense thereof unless (i) the
indemnified party shall have employed separate counsel in connection with the
assertion of legal defenses in accordance with the proviso to the next preceding
sentence (it being understood, however, that the indemnifying party shall not be
liable for the expenses of more than one separate counsel representing the
indemnified parties), (ii) the indemnifying party shall not have employed
counsel reasonably satisfactory to the indemnified party to represent the
indemnified party within a reasonable time after notice of commencement of the
action or (iii) the indemnifying party has authorized the employment of counsel
for the indemnified party at the expense of the indemnifying party; and except
that, if clause (i) or (iii) is applicable, such liability shall be only in
respect of the counsel referred to in such clause (i) or (iii).
Notwithstanding anything to the contrary set forth herein, the liability of
the Seller pursuant to the provisions of this Section 13 shall be subject to the
following limitations:
(a) the Seller shall not have any liability under this Section 13
unless the aggregate amount of all Losses relating thereto for which the
Seller would, but for this proviso, be liable exceeds on a cumulative basis
ONE HUNDRED THOUSAND DOLLARS ($100,000) and, then, subject to clause (b)
below, the Seller shall have liability for the full amount of all Losses
(including, without limitation, all Losses below, either individually or on
a cumulative basis, $100,000);
(b) the maximum liability of the Seller for all Losses arising
subsequent to the consummation of any Closing hereunder, as a result of any
breach of representations, warranties or covenants pertaining to any
Facility (and the applicable portion of the Property relating thereto),
other than all Losses arising as a result of any Environmental Claim, shall
be the applicable Facility Purchase Price paid by the Buyer for such
Facility (or, if applicable, the equity interests of the Single Purpose
Entity Operating such Facility), as the same may have been adjusted
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in accordance with the terms hereof, plus any amounts paid by the Buyer
pursuant to Section 8.12; and
(c) subject to the provisions of the following paragraph, the Seller
shall not have any liability under this Section 13 or otherwise for any
Loss that relates to a design defect or construction defect pertaining to
any Facility, unless, (i) the Seller had knowledge of such design defect or
construction defect prior to the applicable Closing Date or (ii) should
have discovered (or otherwise acquired knowledge of) such design defect or
construction defect prior to the applicable Closing Date during the
ordinary course of operating and maintaining such Facility (any such design
defect described in clause (i) or (ii) shall be referred to herein as a
"Design Defect for Which the Seller has Responsibility").
Without limiting the provisions of Sections 9.5 through 9.15 hereof, in the
event that at any Closing, the Seller has not delivered to the Buyer (or any
applicable Single Purpose Entity acquired by the Buyer) any of the consents to
any assignment of any Architect's Agreement or Construction Contract referred to
in Sections 9.5 through 9.15, it shall not be a default hereunder; provided,
that, in such event, the Seller shall, at its cost and expense, fully cooperate
with the Buyer (and any Single Purpose Entities acquired by the Buyer) in the
pursuit of any claims asserted by the Buyer (or such Single Purpose Entity)
against any Architect and/or any General Contractor on account of any damage or
loss suffered by the Buyer relating to or arising as a result of any design
defect or construction defect pertaining to the applicable Facility which would
not constitute a Design Defect for Which the Seller has Responsibility. Such
cooperation shall include, without limitation, (x) providing all information,
documents and materials as the Buyer may reasonably request, (y) joining in any
action brought by the Buyer and (z) bringing a separate action against any
General Contractor or Architect, but, only to the extent that joining in any
such action or bringing any such separate action is required in order to defeat
any defense asserted by the applicable Architect and/or General Contractor that
it is not liable for any such loss or damage suffered by the Buyer (or any
Single Purpose Entity acquired by the Buyer) because the Buyer (or such Single
Purpose Entity) was not a party to the applicable Architect's Agreement or
Construction Contract. In connection with any such action brought by the Buyer
that the Seller joins or any such separate action that may be brought by the
Seller, the Seller shall be represented by counsel selected by the Buyer and the
Buyer shall be responsible for the direct supervision of any such litigation
and, notwithstanding anything to the contrary set forth herein, the Buyer shall
pay all of the court costs and legal fees incurred by the Seller in connection
therewith. All amounts, if any, collected by the Seller as a result of the
pursuit of such claims shall be paid to the Buyer.
It is acknowledged and agreed that the Seller's indemnification of the
Buyer shall run to the benefit of any Single Purpose Entity acquired by the
Buyer.
The provisions of this Section 13 shall survive each Closing.
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14. Adjustments and Prorations to be Made at Each Closing. Adjustments and
Prorations to be Made at Each Closing.
a. Standard Adjustments. All taxes (including, without limitation,
real estate taxes and taxes on the Tangible Personal Property) collected Rents,
charges for utilities (including, without limitation, water, electric, sewer,
gas and fuel oil) and amounts due under the Assumed Operating Agreements, any
applicable Lease Documents and any applicable Future Financing Documents shall
be prorated at each Closing. If the amount of said taxes, charges, assessments,
or Rents is not known on the applicable Closing Date, they shall be apportioned
on the basis of the amounts for the preceding year, with a reapportionment as
soon as the new amounts can be ascertained. If such taxes, charges and/or
assessments shall thereafter be reduced by abatement, the amount of such
abatement, less the reasonable cost of obtaining the same, shall be apportioned
between the parties, provided, that neither party shall be obligated to
institute or prosecute proceedings for an abatement. All special taxes or
assessments assessed prior to the applicable Closing Date shall be paid by the
Seller and those assessed after such Closing Date shall be paid by the Buyer.
b. Utility Readings. Final readings on all utilities shall be made as
of the applicable Closing Date, if possible. If final readings are not possible,
utility charges shall be prorated based on the most recent period for which
costs are available. Any deposits made by the Seller or made by any Single
Purpose Entity with utility companies shall be returned to the Seller. The Buyer
shall be responsible for making all arrangements for the continuation of utility
services. c. Inventory. On the applicable Closing Date, the Seller shall deliver
to the Buyer all inventories of supplies owned by the Seller or any of its
Affiliates (including any Single Purpose Entity), if any, which are on hand at
the Facility, at no additional cost to the Buyer.
d. Proration of Rent. All Rent received prior to the Closing Date for
the month in which the Closing Date occurs (the "Closing Month") shall be
prorated at Closing. Rents received on or after the Closing Date for the Closing
Month shall be promptly adjusted between the Buyer and the Seller such that the
recipient of such Rents shall within ten (10) days after the funds have cleared
pay to the other party the other party's share of such Rents for the Closing
Month prorated as of the Closing Date as and when collected. If past due Rents
are owing by Residents or other Tenants for months prior to the Closing Month,
the Buyer shall not be responsible for collecting such Rents. Rents collected by
the Buyer after the Closing Date first shall be applied to the Closing Month,
then to Rents due after Closing, and then to the months prior to Closing. The
Seller shall have no right to pursue collection of such past due Rents. Prepaid
Rents and security deposits shall be credited to the Buyer and the Buyer shall
assume all obligations with respect to those deposits so credited.
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e. Proration under Lease Documents and Future Financing Documents. Any
principal and/or interest payments or rent payments due under any Lease
Documents or Future Financing Documents for the Closing Month shall be prorated
as of the Closing Date. With respect to any amounts currently held in any Escrow
Accounts to be assigned to the Buyer, there shall be adjustments to the
applicable Facility Purchase Price in favor of the Seller (i) equal to the
amount held in any Escrow Account that will be applied towards the payment of
insurance policy premiums for any insurance to be obtained by or on behalf of
the Buyer relating to the Property for any period from and after the Closing
Date and (ii) equal to the difference (if positive) between the amount held in
any Escrow Account that is to be applied toward the payment of real estate taxes
and assessments assessed against the applicable Facility and the portion of the
Property relating thereto for the applicable tax year in which the applicable
Closing occurs minus the amount of the real estate taxes and assessments for the
period from the first day of such tax year through the Closing Date (apportioned
on the basis of the amount of the real estate taxes for the preceding year).
In the event that the Buyer assumes any loan obligations under any Future
Financing Documents, an adjustment to the applicable Facility Purchase Price,
equal to the then outstanding principal amount of the obligations (plus, any
accrued interest or other amounts not otherwise adjusted for) assumed by the
Buyer, shall be made in favor of the Buyer.
f. EBITDA Adjustment Regarding Equipment Leases. In the event that in
connection with any Closing, the Seller (i) is obligated pursuant to the terms
hereof to terminate any Operating Agreement that is an equipment lease or
vehicle lease because such Operating Agreement does not constitute an Assumed
Operating Agreement that is assigned to the Buyer in accordance with the terms
hereof or (ii) elects to terminate any equipment lease or vehicle lease, then,
(x) the EBITDA calculation used to determine the applicable Facility Purchase
Price shall be adjusted accordingly to delete the rental or lease payments made
under such equipment lease or vehicle lease and the Facility Purchase Price
payable hereunder shall be adjusted accordingly and (y) the equipment or vehicle
that was the subject of such equipment lease or vehicle lease shall be conveyed
to the Buyer (or, if applicable, the Single Purpose Entity acquired by the Buyer
at such Closing) as part of the Property to be acquired by the Buyer at such
Closing.
g. Post-Closing Settlements. All other items which are not subject to
an exact determination shall be estimated by the parties. When any item so
estimated is, after the applicable Closing, capable of exact determination, the
party in possession of the facts necessary to make the determination shall send
the other party a detailed report on the exact determination so made and the
parties shall adjust the prior estimate within ten (10) days after both parties
have received said reports. All such claims shall be made within one year of the
applicable Closing.
i. Survival. The provisions of this Section 14 shall survive
consummation of each Closing.
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15. Costs. The Seller shall pay the full amount of recording costs and
documentary, stamp or other taxes required in connection with any assignments of
the Seller's interest under the Naples Lease Documents. The Buyer shall pay the
full amount of all recording costs and documentary, stamp or other taxes
required in connection with any assignments of the Seller's interest under the
Future Financing Documents relating to the Richmond Property. The Buyer and the
Seller shall split equally the amount of all recording costs and documentary,
stamp or other taxes required in connection with any assignments of the Seller's
interest under any of the other Lease Documents or Future Financing Documents.
Except as may be otherwise expressly provided herein, each party shall pay
all costs incurred by it in connection with the preparation, negotiation and
performance of this Agreement; provided. however, that, in the event of any
litigation between the parties arising under this Agreement, the prevailing
party shall be reimbursed all reasonable costs incurred in connection with such
litigation (including, without limitation, attorneys' fees and expenses) by the
non-prevailing party.
16. Brokerage Warranty. The Seller and the Buyer represent and warrant to
each other that neither has dealt with any real estate agent or broker, and was
not called to the attention of the other as a result of any services or
facilities of any such real estate agent or broker. The Seller and the Buyer
hereby agree to indemnify, exonerate and hold the other harmless from and
against any claim, loss, damage, cost or liability for any brokerage commission
or fee which may be asserted against the other as a result of the other's breach
of this warranty. The provisions in this Section shall survive the consummation
of each Closing contemplated hereunder or any earlier termination of this
Agreement.
17. Recording. At its election and expense, the Buyer may record a short
form notice or memorandum pertaining to this Agreement in the applicable offices
of land records where the Property is located. Promptly upon the request of the
Buyer, the Seller shall execute any such short form notice or memorandum.
18. Remedies. The rights and remedies of the Buyer hereunder may be
enforced at law or in equity. The agreements, covenants and obligations of the
Seller under this Agreement shall be deemed of the essence and every breach
thereof material to the Buyer and special, unique and extraordinary so that any
breach thereof shall be deemed to cause the Buyer irreparable injury justifying
a decree of specific performance by a court of competent jurisdiction and not
properly compensable solely by money damages in an action at law. Therefore, in
the event that the Buyer shall institute any action to enforce the provisions of
this Agreement, the Seller hereby acknowledges that the Buyer does not have an
adequate remedy at law and that injuncture or other equitable relief will not
constitute any hardship on the Seller. If the Buyer shall fail to consummate the
Closing relating to any Facility, notwithstanding the satisfaction of all
Closing Conditions relating thereto (a "Buyer Default")
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(a) the sole remedy, at law or in equity, of the Seller as a consequence of any
such Buyer Default shall be to be paid by the Buyer an amount equal to the
Liquidated Damages Amount in effect as of date that such Closing was to occur,
which sum the parties fix and settle as liquidated damages for such Buyer
Default, and the Seller shall have no right or be entitled to bring an action
for specific performance or for any other damages whatsoever and (b) as a
consequence of any such Buyer Default, all Put Rights and Call Rights relating
to any portion of the Property that has not been the subject of a Closing
previously consummated hereunder shall be extinguished and of no further force
or effect as of the date of such Buyer Default and neither party hereto shall
have any further obligations hereunder with respect to that portion of the
Property. It is acknowledged and agreed that any portion of the Total Option
Payment paid by the Buyer to the Seller that was not applied as a credit toward
the payment of any Facility Purchase Price paid by the Buyer to the Seller in
connection with a Closing consummated hereunder prior to any such Buyer Default
shall be applied toward any payment of the Liquidated Damages Amount due
hereunder.
19. Waiver. Neither party shall by any act, delay, omission or otherwise
(including, without limitation, the exercise of any right or remedy hereunder)
be deemed to have waived any of its rights or remedies hereunder unless such
waiver is in writing and signed by the party sought to be charged, and then,
only to the extent specifically set forth therein. No waiver at any time of any
of the terms, conditions, covenants or warranties of this Agreement shall be
construed as a waiver of any other term, condition, covenant or warranty of this
Agreement, nor shall such a waiver in any one instance or circumstance be
construed as a waiver of the same term, condition, covenant or warranty in any
subsequent instance or circumstance. No such failure, delay or waiver shall be
construed as creating a requirement that a party must thereafter, as a result of
such failure, delay or waiver, give notice to the other party that such party
does not intend to give a further waiver or to refrain from insisting upon the
strict performance of the terms, conditions, covenants and warranties set forth
in this Agreement before such party can exercise any of its rights or remedies
under this Agreement or as establishing a course of dealing for interpreting the
conduct of and agreements between the parties.
The acceptance by either party of any payment that is less than payment in
full of all amounts due under this Agreement at the time of the making of such
payment shall not: (a) constitute a waiver of the right to exercise any of such
party's remedies at that time or at any subsequent time; (b) constitute an
accord and satisfaction or (c) nullify any prior exercise of any remedy, without
the express written consent of such party.
20. Time. It is agreed that time is of the essence of this Agreement.
21. Governing Law and Consent to Jurisdiction. This Agreement shall be
governed by and construed in accordance with the laws of the State of Florida;
provided, however, that the provisions of Section 8.5 and
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Section 8.6, as well as the provisions of any Non-competition Agreement, shall
be governed by and construed in accordance with the laws of the Commonwealth of
Massachusetts.
To the maximum extent permitted by applicable law, the parties hereto, for
the purposes of enforcing Section 8.5 and Section 8.6 of this Agreement, ▇▇▇▇▇▇
and the General Partner each hereby irrevocably and unconditionally submit to
the exclusive jurisdiction of the courts of the Commonwealth of Massachusetts
and the United States District Court for the District of Massachusetts, as well
as to the jurisdiction of all courts from which an appeal may be taken from the
aforesaid courts, for the purpose of any suit, action or other proceeding
arising out of, or with respect to the provisions of Section 8.5 or 8.6 of this
Agreement and expressly irrevocably waive any and all objections they may have
as to venue or inconvenient forum in any of such courts. Notwithstanding the
foregoing, at the option of the Buyer, the Buyer may elect to bring any suit,
action or other proceeding arising out of, or with respect to Section 8.5 or 8.6
of this Agreement in any court of the State of Florida or any United States
District Court located in the State of Florida.
To the maximum extent permitted by applicable law, the parties hereto, for
the purposes of enforcing all provisions of this Agreement other than Section
8.5 and Section 8.6 and the first two paragraphs of Section 21 of this
Agreement, each irrevocably and unconditionally submit to the exclusive
jurisdiction of the courts of the State of Florida or any United States District
Court located in Florida, as well as to the jurisdiction of all courts from
which an appeal may be taken from the aforesaid courts, for the purpose of any
suit, action or proceeding arising out of, or with respect to this Agreement
(excluding, however, enforcement of the provisions of Section 8.5, Section 8.6,
the first two paragraphs of this Section 21 and any Non-Competition Agreement)
and expressly irrevocably waive any and all objections they may have as to venue
or inconvenient forum in any of such courts.
22. Notices. Any notice, request, demand, statement or consent required or
permitted to be given hereunder shall be in writing and sent by a nationally
recognized overnight delivery service (such as Federal Express), in which case
notice shall be deemed given on the day after the date sent, or by personal
delivery, in which case notice shall be deemed given on the date received, or by
facsimile, in which case notice shall be deemed given on the date when such
facsimile was confirmed as received, to the appropriate address and facsimile
number indicated below or at such other place or places, or facsimile number or
numbers, as either the Buyer or the Seller may, from time to time, respectively,
designate in a written notice given to the other parties hereto in the manner
described above.
To Seller: National Assisted Living Limited Partnership
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, ▇▇.
Facsimile Number: (▇▇▇) ▇▇▇-▇▇▇▇
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With a copy to: ▇▇▇▇▇ & Stant, P.C.
▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Esq.
Facsimile Number:(▇▇▇) ▇▇▇-▇▇▇▇
To Buyer: CareMatrix of Massachusetts, Inc.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: President
Facsimile Number: (▇▇▇) ▇▇▇-▇▇▇▇
With copies to: CareMatrix of Massachusetts, Inc.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: General Counsel
Facsimile Number: (▇▇▇) ▇▇▇-▇▇▇▇
and
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ & Fish, LLP
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, Esq.
Facsimile Number: (▇▇▇) ▇▇▇-▇▇▇▇
23. Entire Agreement. This Agreement sets forth the entire agreement
between the parties and may not be canceled, modified, or amended except by a
written instrument executed by the Seller and the Buyer. This Agreement
supersedes any prior agreements or memoranda between the parties hereto relating
to the Property. The preparation of this Agreement has been the joint effort of
the parties and the resulting document shall not be construed more severely
against one of the parties than the other.
24. Access. From and after the date hereof, upon prior written notice to
the Seller the Buyer shall have access to the Property for the purpose of
showing the Property to third parties, performing, or causing to be performed,
such surveying, structural, mechanical, engineering, environmental, geotechnical
and other tests and investigations as the Buyer deems necessary or desirable;
provided, that, in the exercise of its right of entry hereunder, the Buyer shall
not unreasonably interfere with the construction of any Development Project or
the operation of any Facility. The Buyer hereby releases and forever discharges
the Seller and its successors and assigns of and from all debts, demands,
actions, causes of action, suits, proceedings, judgments, damages, claims and
liabilities whatsoever of every kind and nature, which the Buyer may have by
reason of its entry upon the Property
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prior to the Closing Date for the purpose of performing such tests and
investigations (the "Work"); provided, however, that, nothing contained herein
shall relieve the Seller from responsibility from its own negligence or willful
misconduct or the negligence or willful misconduct of the Seller, its agents,
servants, employees or contractors; and the Buyer indemnifies and holds the
Seller harmless from and against claims and expenses in connection with the Work
resulting from the negligence or willful misconduct of the Buyer, its agents,
servants, employees or contractors. Without limiting the foregoing, none of the
foregoing indemnities shall include an indemnification of the Seller for
remediation of Hazardous Substances on, under or affecting any portion of the
Property.
The Buyer's right to access the Property may be exercised at any time, and
from time to time, as long as this Agreement is in force and effect.
25. Publicity. All press releases, filings and other publicity concerning
the transactions contemplated hereby will be subject to review and approval by
both the Seller and the Buyer, such approval not to be unreasonably withheld or
delayed. Such approval shall not be required if the Person issuing such
publicity reasonably believes it to be necessary for compliance with applicable
law, but such Person shall provide the other party with reasonable notice and an
opportunity to review the same before any such release. Both the Seller and the
Buyer hereby covenant and agree to keep the terms and conditions of this
Agreement confidential.
26. General Provisions. References in this Agreement to "herein", "hereof"
and "hereunder" shall be deemed to refer to this Agreement and shall not be
limited to the particular text or Section in which such words appear. The use in
this Agreement of any gender shall include all genders and the singular number
shall include the plural and vice versa as the context may require. References
in this Agreement to the Property shall be deemed to include references to all
of the Property and references to any portion thereof.
As used in this Agreement, the term "including", when following any general
statement, will not be construed to limit such statement to the specific items
or matters as provided immediately following the term "including" (whether or
not non-limiting language such as "without limitation" or "but not limited to"
or words of similar import are also used), but rather will be deemed to refer to
all items or matters that could reasonably fall within the broader scope of the
general statement. All accounting terms not specifically defined in this
Agreement shall be construed in accordance with GAAP.
27. WAIVER BY JURY TRIAL. BUYER AND SELLER EACH HEREBY MUTUALLY, KNOWINGLY
AND VOLUNTARILY WAIVE THE RIGHT TO A TRIAL BY JURY OF ANY AND ALL CLAIMS MADE
BETWEEN THEM WHETHER NOW EXISTING OR HEREAFTER ARISING IN THE FUTURE INCLUDING,
WITHOUT LIMITATION, ANY AND ALL CLAIMS,
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DEFENSES, COUNTERCLAIMS, CROSS CLAIMS, THIRD PARTY CLAIMS AND INTERVENORS'
CLAIMS WHETHER ARISING FROM OR RELATED TO THE SALE, NEGOTIATION, EXECUTION OR
PERFORMANCE OF THE TRANSACTIONS TO WHICH THIS AGREEMENT RELATES.
28. Captions and Headings. The captions and headings set forth in this
Agreement are included for convenience and reference only and the words
contained therein shall in no way be held or deemed to define, limit, describe,
explain, modify, amplify or add to the interpretation, construction or meaning
of, or the scope or intent of, this Agreement.
29. Counterparts. This Agreement may be executed in one or more
counterparts, each of which taken together shall constitute an original and all
of which shall constitute one and the same instrument.
30. No Joint Venture or Partnership. Neither anything contained in this
Agreement, nor the acts of the parties hereto shall be construed to create a
partnership or joint venture between the Seller or any of the Single Purpose
Entities and the Buyer. Neither the Seller, nor any of the Seller's Affiliates
(including, without limitation, the Single Purpose Entities) is the agent or
representative of the Buyer, and nothing contained herein shall be construed to
make the Buyer liable to any Person for goods delivered or services performed
with respect to the Property or for debts or claims accruing against the Seller
or any of its Affiliates.
31. Amendments, Waivers and Modifications. None of the terms, covenants,
conditions, warranties or representations contained in this Agreement may be
renewed, replaced, amended, modified, extended, substituted, revised, waived,
consolidated or terminated, except by an agreement, in writing, signed by (a)
all parties to this Agreement with regard to any such renewal, replacement,
amendment, modification, extension, substitution, revision, consolidation or
termination or (b) the Person against whom enforcement is sought with regard to
any waiver. The provisions of this Agreement shall extend and be applicable to
all renewals, replacements, amendments, extensions, substitutions, revisions,
consolidations and modifications of the Lease Documents, the Future Financing
Documents, the Transfer Documents, the Blue ▇▇▇▇ Purchase Documents, the
Richmond Purchase Documents, the Leases, the Permits and/or the Contracts; and
all references herein to any of the Lease Documents, the Future Financing
Documents, the Leases, the Permits and the Contracts shall be deemed to include
any renewals, replacements, amendments, extensions, substitutions, revisions,
consolidations or modifications thereof.
Notwithstanding the foregoing, any reference contained herein, whether
express or implied, to any renewal, replacement, amendment, extension,
substitution, revision, consolidation or modification of any of the Lease
Documents, any of the Future Financing Documents, any of the Transfer Documents,
any of the Blue ▇▇▇▇ Purchase Documents, any of
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the Richmond Purchase Documents, any Lease, any Permit or any Contract is not
intended to constitute an agreement or consent by the Lender to any such
renewal, replacement, amendment, extension, substitution, revision,
consolidation or modification of any of the foregoing; but, rather as a
reference only to those instances where the Buyer may give, agree or consent to
any such renewal, replacement, amendment, extension, substitution, revision,
consolidation or modification, as the same may be required pursuant to the
terms, covenants and conditions of this Agreement.
32. Successors and Assigns. This Agreement shall be binding on and inure to
the benefit of the Buyer and the Seller and their respective successors and
assigns. Notwithstanding the foregoing, neither the Buyer nor the Seller shall
assign any of its rights or obligations hereunder without the prior consent of
the other, in each instance, which consent may be withheld in such other party's
sole and absolute discretion; provided, however, that, prior to the Closing
relating to any Facility, the Buyer may elect any other wholly-owned Subsidiary
of CareMatrix as the Buyer's nominee (each, a "Nominee") to take title to the
Seller's interest in the Facility (and the applicable portion of the Property
relating thereto) or the Seller's equity interest in the applicable Single
Purpose Entity that operates such Facility.
33. No Third Party Beneficiaries. This Agreement is solely for the benefit
of the Buyer and its successors and assigns, and, except as otherwise expressly
set forth in Section 8.5 hereof, nothing contained therein shall confer upon
anyone other than such parties any right to insist upon or to enforce the
performance or observance of any of the obligations contained therein.
34. Further Assurances. From time to time before or after any Closing, at
no additional consideration, the parties hereto each agree that they will
promptly execute and deliver (or cause the execution and delivery by their
respective Subsidiaries and Affiliates of) all additional documents and perform
(or cause the performance of) any other acts that may be reasonably requested in
order to effectuate the intent of this Agreement and to consummate the
transactions contemplated hereby.
35. Cooperation. The parties hereto shall cooperate with each other and use
their best efforts to (a) promptly prepare and file all necessary documentation
to effect all required applications, notices, petitions and filings required in
accordance with the terms hereof and (b) obtain consents required hereunder. The
Buyer and the Seller shall have the right to review in advance, and to the
extent practicable each will consult the other on, in each case subject to
applicable laws relating to the exchange of information, all the information
relating to the Buyer or the Seller, or written materials submitted to, any
third party or any Governmental Authority in connection with the transactions
contemplated by this Agreement. In exercising the foregoing right, each of the
parties hereto shall act reasonably and as promptly as practicable. The parties
hereto agree that they will consult with each other with respect to the
obtaining of all permits, consents, approvals and authorizations of all third
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parties and Governmental Authorities necessary or advisable to consummate the
transactions contemplated by this Agreement and each party will keep the other
apprised of the status of matters relating to completion of the transactions
contemplated herein.
36. No Solicitation. From the date of this Agreement until its termination,
the Seller shall not, directly or indirectly, through any of its officers,
directors, employees, representatives or agents, encourage, solicit or initiate
discussions or negotiations with, or knowingly provide any information to, any
Person (other than the Buyer and its agents and representatives) concerning the
sale of any Facility or any other portion of the Property or the sale of any
ownership interest in any Single Purpose Entity; provided, however, that in the
event that any Closing involving any Facility is not consummated in accordance
with the terms hereof on or before the Outside Closing Date, the Seller may
enter into any such discussions or negotiations with respect to such Facility
(and/or any Single Purpose Entity that owns or leases such Facility).
37. Exhibits and Schedules. All Exhibits and Schedules referred to in this
Agreement shall be incorporated into this Agreement by such reference and shall
be deemed a part of this Agreement as if fully set forth in the this Agreement.
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IN WITNESS WHEREOF, the parties hereto have caused these presents to be
executed, as a sealed instrument, the day and year first above written.
SELLER:
-------
NATIONAL ASSISTED LIVING LIMITED
PARTNERSHIP, a Florida limited partnership
By: NATIONAL ASSISTED LIVING, INC., a
Florida corporation, its sole general partner
By:____________________________________
Name:
Title:
BUYER:
------
CAREMATRIX OF MASSACHUSETTS, INC., a
Delaware corporation
By:__________________________________________
Name:
Title:
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The undersigned hereby executes this Agreement solely for the purpose of
agreeing to the provisions set forth in Section 8.5, Section 8.6 and Section 21
of this Agreement
------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, ▇▇.
NATIONAL ASSISTED LIVING, INC.,
a Florida corporation
By:___________________________
Name:
Title:
453541_9.WP6
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EXHIBIT A-1
BIRMINGHAM REAL PROPERTY
EXHIBIT A-2
BLUE ▇▇▇▇ REAL PROPERTY
EXHIBIT A-3
CARMEL REAL PROPERTY
EXHIBIT A-4
DUBLIN REAL PROPERTY
EXHIBIT A-5
GERMANTOWN REAL PROPERTY
EXHIBIT A-6
HOCKESSIN REAL PROPERTY
EXHIBIT A-7
NAPLES REAL PROPERTY
NOT APPLICABLE
EXHIBIT A-8
OVERLAND PARK REAL PROPERTY
EXHIBIT A-9
RICHMOND REAL PROPERTY
EXHIBIT A-10
▇▇▇▇▇▇▇▇▇▇ REAL PROPERTY
[NOT YET APPROVED BY BUYER]
EXHIBIT A-11
WEST BLOOMFIELD HILLS REAL PROPERTY
EXHIBIT B-1
BIRMINGHAM BUDGET
EXHIBIT B-2
BLUE ▇▇▇▇ BUDGET
EXHIBIT B-3
CARMEL BUDGET
NOT APPLICABLE
EXHIBIT B-4
DUBLIN BUDGET
EXHIBIT B-5
GERMANTOWN BUDGET
EXHIBIT B-6
HOCKESSIN BUDGET
EXHIBIT B-7
NAPLES BUDGET
EXHIBIT B-8
OVERLAND PARK BUDGET
EXHIBIT B-9
RICHMOND BUDGET
[NOT YET APPROVED BY THE BUYER]
EXHIBIT B-10
▇▇▇▇▇▇▇▇▇▇ BUDGET
[NOT YET APPROVED BY THE BUYER]
EXHIBIT ▇-▇▇
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ BUDGET
[NOT YET APPROVED BY THE BUYER]
EXHIBIT C-1
BIRMINGHAM PLANS AND SPECIFICATIONS
EXHIBIT C-2
BLUE ▇▇▇▇ PLANS AND SPECIFICATIONS
[NOT YET APPROVED BY THE BUYER]
EXHIBIT C-3
CARMEL PLANS AND SPECIFICATIONS
EXHIBIT C-4
DUBLIN PLANS AND SPECIFICATIONS
EXHIBIT C-5
GERMANTOWN PLANS AND SPECIFICATIONS
EXHIBIT C-6
HOCKESSIN PLANS AND SPECIFICATIONS
EXHIBIT C-7
NAPLES PLANS AND SPECIFICATIONS
EXHIBIT C-8
OVERLAND PARK PLANS AND SPECIFICATIONS
EXHIBIT C-9
RICHMOND PLANS AND SPECIFICATIONS
[NOT YET APPROVED BY THE BUYER]
EXHIBIT C-10
▇▇▇▇▇▇▇▇▇▇ PLANS AND SPECIFICATIONS
[NOT YET APPROVED BY THE BUYER]
EXHIBIT C-11
WEST BLOOMFIELD HILLS PLANS AND SPECIFICATIONS
[NOT YET APPROVED BY THE BUYER]
EXHIBIT D
EXISTING LEASE DOCUMENTS
A. NAPLES PROPERTY
1. Naples Lease.
2. Naples Development Agreement.
3. Guaranty of Obligations by the Guarantor in favor of NHP dated July
30, 1996.
4. Letter of Credit Agreement dated as of July 30, 1996 by and between
NHP, as Beneficiary and the Seller, as amended by First Amendment to
Lease and Security Agreement and Related Documents (Naples, Florida)
dated as of January 21, 1998 by and among NHP, the Seller and the
Guarantor.
5. Naples Letter of Credit.
6. Guaranty of Lease, Letter of Credit Agreement and Development
Agreement dated as of July 30, 1996 by the Guarantor in favor of NHP.
7. Assignment of Project Agreements and Project Plans and Specifications
dated as of July 30, 1996 by the Seller, as Assignor, to NHP as
Assignee.
8. Assignment of Permits, Licenses, Franchises and Authorizations dated
July 30, 1996 by the Seller, as Assigner, and NHP, as Assignee.
9. Memorandum of Lease dated July 30, 1996 by NHP, as Landlord, and the
Seller, as Tenant, recorded in official records of ▇▇▇▇▇▇▇ County at
Official Records 2213, Page 1266.
B. CARMEL PROPERTY
1. Carmel Lease.
2. Carmel Development Agreement.
3. Guaranty of Obligations by the Guarantor in favor of NHP dated January
21, 1997.
4. Letter of Credit Agreement dated as of January 21, 1997 by and between
NHP, as Beneficiary, and the Seller, as amended by First Amendment to
Lease and Security Agreement and Related Documents (Carmel, Indiana)
dated as of January 21, 1998 by and among NHP, the Seller and the
Guarantor.
5. Carmel Letter of Credit.
6. Guaranty of Lease, Letter of Credit Agreement and Development
Agreement dated as of January 21, 1997 by the Guarantor in favor of
NHP.
7. Assignment of Project Agreements and Project Plans and Specifications
dated as of May 29, 1997 by Seller, as Assignor, to NHP as Assignee.
8. Assignment of Permits, Licenses, Franchises and Authorizations dated
May 29, 1997 between the Seller, as Assignor, for the benefit of NHP
as Assignee.
9. Memorandum of Lease by NHP, as Landlord and the Seller, as Tenant,
dated January 21, 1997 filed with ▇▇▇▇▇▇▇▇ County Recorder as Document
No. 9709703345.
C. ▇▇▇▇▇▇
▇. ▇▇▇▇▇▇ Lease.
2. Dublin Development Agreement.
3. Guaranty of Obligations by the Guarantor in favor of NHP dated April
29, 1997.
4. Letter of Credit Agreement dated as of April 29, 1997 by and between
NHP, as Beneficiary, and Seller, as amended by First Amendment to
Lease and Security Agreement and Related Documents (Dublin, Ohio)
dated as of January 21, 1998 by and among NHP, Seller and the
Guarantor.
5. Dublin Letter of Credit.
6. Guaranty of Lease, Letter of Credit Agreement and Development
Agreement dated as of April 29, 1997 by the Guarantor in favor of NHP.
7. Assignment of Project Agreements and Project Plans and Specifications
dated as of May 6, 1997 by the Seller, as Assignor, to NHP as
Assignee.
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8. Assignment of Permits, Licenses, Franchises and Authorizations dated
November 4, 1997 between the Seller, as Assignor, and NHP, as
Assignee.
9. Memorandum of Lease dated as of April 29, 1997 by NHP, as Landlord,
and the Seller, as Tenant, recorded in Franklin County Official
Records 35000F11 on May 2, 1997.
D. GERMANTOWN PROPERTY
1. Germantown Lease.
2. Germantown Development Agreement.
3. Guaranty of Obligations by the Guarantor in favor of NHP dated May 15,
1997.
4. Letter of Credit Agreement dated as of May 15, 1997 by and between
NHP, as Beneficiary, and Seller, as amended by First Amendment to
Lease and Security Agreement and Related Documents (Germantown,
Tennessee) dated as of January 21, 1998 by and among NHP, the Seller
and the Guarantor.
5. Germantown Letter of Credit.
6. Guaranty of Lease, Letter of Credit Agreement and Development
Agreement dated as of May 15, 1997 by the Guarantor in favor of NHP.
7. Assignment of Project Agreements and Project Plans and Specifications
dated as of May 15, 1997 by the Seller, as Assignor, to NHP as
Assignee.
8. Assignment of Permits, Licenses, Franchises and Authorizations dated
as of June 3, 1998 by the Seller, as Assignor, and NHP as Assignee.
9. Memorandum of Lease dated as of May 15, 1997 by NHP, as Landlord and
the Seller, as Tenant, recorded with Shelby County Registry of Deeds
on May 29, 1997 under Register's Nos. GP8242 and GP8243.
E. BIRMINGHAM PROPERTY
1. Birmingham Lease.
2. Birmingham Development Agreement.
3. Birmingham Letter of Credit.
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4. Memorandum of Lease, dated as of September 25, 1997, recorded in the
Office of the Judge of Probate of Shelby County Alabama as Instr.
#1997-34525 and 1997- 35244.
5. Birmingham Acquisition Agreement.
F. OVERLAND PARK PROPERTY
1. Overland Park Lease.
2. Overland Park Development Agreement.
3. Overland Park Letter of Credit.
4. Memorandum of Lease, dated as of January 23, 1998, filed with the
▇▇▇▇▇▇▇ County Registry of Deeds in Book 5486, Page 949.
5. Contract of Acquisition, dated as of January 23, 1998, by and between
Seller, as Seller, and HCPI, as Buyer.
G. HOCKESSIN PROPERTY
1. Hockessin Lease.
2. Hockessin Development Agreement.
3. Guaranty of Obligations by the Guarantor in favor of MLD dated March
19, 1998.
4. Letter of Credit Agreement dated as of March 19, 1998 by and between
MLD Delaware Trust, as Beneficiary and the Seller.
5. Hockessin Letter of Credit.
6. Guaranty of Lease, Letter of Credit Agreement and Development
Agreement dated as of March 19, 1998 by the Guarantor in favor of MLD.
7. Assignment of Project Agreements and Project Plans and Specifications
dated as of March 19, 1988 by the Seller, as Assignor, to MLD as
Assignee.
-4-
8. Assignment of Permits, Licenses, Franchises and Authorizations dated
March 19, 1988 between the Seller, as Assignor, and MLD, as Assignee.
9. Memorandum of Lease dated July 30, 1996 recorded in official records
of ▇▇▇▇▇▇▇ County on August 2, 1996, O.R. 2213, Page 1266 by MLD, as
Landlord, and Seller as Tenant.
-5-
EXHIBIT E
PERMITTED ENCUMBRANCES
A. BIRMINGHAM PROPERTY
1. Title to all minerals within the underlying premises, together with
all mining rights and other rights, privileges and immunities relating
thereto, including rights set out in Deed Book 66, Page 34, and Deed
Book 28, Page 581 in Probate Office.
This is a Permitted Encumbrance provided that the Title Insurance
Company issuing the Buyer's Title Insurance Policy relating to the
Birmingham Real Property insures against loss or damage to
improvements located on such property which may be occasioned by the
enforcement or attempted enforcement of the right to use the surface
of the land in order to remove minerals, without the consent of the
surface owner(s).
2. Declaration of Covenants, Conditions and Restrictions for Meadow Brook
Corporate Park as set out in Real 5, Page 772 along with 1st Amendment
recorded in Real 177, Page 269; Second Amendment recorded under
Instrument Number 1993-18243; and Third Amendment as recorded under
Instrument Number 1996- 27981.
3. Building setback line(s) and Public easement(s) as shown by the
recorded plat in Map Book 21, Page 92.
4. Telephone Panel Base and Telephone Box encroachments over Easterly lot
line along Meadow Ridge Road; Drain Pipe encroachments over Easterly
lot line along Meadow Ridge Road; Drain Pipe encroachments over
Northerly lot line along Corporate Drive as shown by survey of ▇▇▇▇▇▇
▇▇▇▇▇▇ Engineering Company, Inc., dated June 20, 1997.
B. BLUE ▇▇▇▇ PROPERTY
[Not Yet Approved by Buyer]
C. CARMEL PROPERTY
1. Easement, restrictions, possible assessments for maintenance, and
rights of others entitled to the continued uninterrupted flow of water
through the ▇. ▇.
▇▇▇▇▇▇ Legal Drain, in accordance with Indiana Drain Code, IC (1981)
36-9-27-33 et seq. Said easement and restrictions have been amended by
agreements by and between Technology Center Associates, LTD. and the
▇▇▇▇▇▇▇▇ County Drainage Board, and recorded May 20, 1986, in Easement
Record 4, page 28, recorded May 19, 1987, as Instrument 87-11579, and
recorded November 18, 1987, as Instrument 87-047768.
2. Dedication of Street Right-of-Way dated September 1, 1987, and
recorded September 9, 1987, as Instrument 87-42050, for Technology
Drive along a portion of the east line of subject real estate.
Acknowledgement of Dedication and Acceptance recorded September 9,
1987, as Instrument 87-42051.
3. Storm Sewer and Drainage Easement in favor of Carmel-Indiana Venture
recorded March 13, 1990, as Instrument 90-05626.
4. Covenants, conditions, restrictions, easements, and obligations set
out in Meridian Technology Center Declaration of Covenants and
Easements, dated December 30, 1986, and recorded December 31, 1986, in
Miscellaneous Record 190, page 405. Said Declaration was modified by
Modification of Declaration dated September 30, 1987, and recorded
October 2, 1987, as Instrument 87-43980, and further modified by
Second Modification of Declaration dated December 8, 1993, and
recorded January 5, 1994, as Instrument 94-00758.
5. The following items with respect to survey certified August 9, 1996,
and recertified November 25, 1996, by ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇, Registered
Land Surveyor, with ▇▇▇▇▇▇▇▇▇ Engineering Corporation, under Job No.
0192033C:
a. Asphalt drive and turnaround along the east side of subject
tract.
b. Manholes along the east side of subject tract.
c. Storm inlet and sewer along the south and east sides of subject
tract.
d. Underground irrigation system and pump house.
D. DUBLIN PROPERTY
AS TO PARCEL ONE:
1. Notice of Commencement filed October 1, 1997, as Instrument No.
199710010107992.
-2-
2. Easement & Right of Way granted to Columbus Southern Power
Company, recorded at Instrument No. 199802050027855.
3. Terms and conditions of Grant of Reciprocal Easements recorded as
Instrument No. 19980518011987.
AS TO PARCEL TWO:
1. Easement Granted to Ohio ▇▇▇▇ Telephone Company and Ameritech,
recorded as Instrument No. 199711260153010.
2. Easement granted to Columbia Gas of Ohio, Inc., recorded as
Instrument No. ▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇.
AS TO PARCEL THREE:
1. Terms and conditions of easements to City of Dublin recorded at
Official Records No. 16852A11, 14042F16, 11181B20, 11335B10 and
14821J12.
2. Terms and conditions of easements to United Dairy Farmers, Inc.
recorded at Official Record No. 14298J07.
3. Easements reserved in warranty deeds recorded at Official Records
No. 16120J01, 14042F13 and 11181C03.
4. Notice of Commencement recorded at Instrument No.
▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇.
AS TO PARCEL ONE AND TWO:
1. Fifty foot (50') Building setback line and easements for public
utilities, as shown of record on the recorded plat for Reserve D
of Indian Run ▇▇▇▇▇▇▇, Section 5 recorded at Plat Book 65, Page
65.
2. Easement to Columbus and Southern Ohio Electric Company over part
of a larger tract of which insured premises is a part, of record
in Official Record 08680C15.
3. Easement to Columbus and Southern Ohio Electric Company of record
in Official Record 09214C03.
-3-
4. Terms and conditions of Grant of Reciprocal Easements For
Driveway Purposes And Agreement To Jointly Maintain Demised
Easement Areas filed May 2, 1997, in Official Record 35000E16,
Recorder's Office, Franklin County, Ohio.
E. GERMANTOWN PROPERTY
1. Easement for 1-1/2 inch water line along the south property line of
record in Record Book 1506, Page 107, in the Register's Office of
Shelby County, Tennessee.
2. Anchor Guy Easement of record in Record Book 4626, Page 624, in said
Register's Office and being same as shown on survey prepared by The
▇▇▇▇▇▇▇▇▇ Firm dated March 6, 1997, as revised April 23, 1997 and May
19, 1997 (the "Germantown Survey").
3. Slope Easement described in Instrument recorded in Record Book 6033,
Page 412, in said Register's Office, and being the same as shown on
the Germantown Survey.
4. Eight foot wide easement of record under Register's No. J2 8740, in
said Register's Office and same as shown on said survey.
F. HOCKESSIN PROPERTY
1. Drainage Easement and Maintenance Declaration as the same does more
fully appear in the Office of the Recorder of Deeds, in and for New
Castle County and State of Delaware, at Wilmington in Deed Book 2145,
Page 27.
2. Notes, easements, restrictions and conditions as shown on the Record
Resubdivision Plan recorded in the Office of the Recorder of Deeds as
aforesaid, in Microfilm Record No. 10402 and Record Major Land
Development Plan recorded in the Office of the Recorder of Deeds, as
aforesaid, in Microfilm Record No. 13416.
G. OVERLAND PARK PROPERTY
1. Easement to JCSSD No. 4 recorded in Book 163 Misc. page 232, as
described therein.
2. Easement to LSD No. 18 ICSSD No. 4 recorded in Volume 1131 Page 466
over the Southeasterly 50 feet as described therein.
-4-
3. Storm Sewer Easement to City of Overland Park recorded in Book 188
Misc. page 443, as described therein.
4. Resolution 87-98 recorded in Volume 2694 Page 729 for creating LSD 33
enlargement JSD 4-B of ICSSD No. 4.
5. Rights of others entitled thereto, in and to the continued
uninterrupted flow of the stream(s) crossing captioned premises.
6. Riparian rights incident to the premises.
7. The following matters shown on survey entitled "ALTA/ACSM Land Title
Survey Part of the NW 1/4, Sec. 8-13-25 Overland Park, Jo. Co.,
Kansas," by ▇▇▇▇▇▇, ▇▇▇▇▇ & Warren, P.A. dated 1-9-98.
a. 4' x 4' Power and Light Pad on eastern boundary; and
b. Two (2) sanitary sewer lines (no easement furnished) in southern
area of property.
H. NAPLES PROPERTY
PARCEL NO. 1
1. Easement contained in the instrument dated November 18, 1975, and
recorded December 17, 1975 in Official Records Book 637, Page 865, of
the Public Records of ▇▇▇▇▇▇▇ County, Florida.
2. The terms, conditions and restrictions as set forth in the Joint
Access Agreement between Nationwide Health Properties, Inc., a
Maryland corporation and ▇▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ as
Trustee under Agreement dated May 23, 1989, ▇▇▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇▇▇ ▇.
▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇ and ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇, dated July 25, 1996 and
recorded August 2, 1996 in O.R. Book 2213, Page 1273, Public Records
of ▇▇▇▇▇▇▇ County, Florida.
3. Easement in favor of Florida Power & Light Company dated October 25,
1996, and recorded March 14, 1997, in O.R. Book 2294, Page 1733,
Public Records of ▇▇▇▇▇▇▇ County, Florida.
-5-
4. Easement in favor of the City of Naples dated April 22, 1997, and
recorded April 29, 1997, in O.R. Book 2308, Page 3161, Public Records
of ▇▇▇▇▇▇▇ County, Florida.
PARCEL NO. 2
1. Easement contained in the instrument dated June 19, 1953, and recorded
November 14, 1953, in Deed Book 30, Page 375, Public Records of
▇▇▇▇▇▇▇ County, Florida.
2. Easement contained in the instrument dated September 15, 1953, and
recorded November 14, 1953, in Deed Book 30, Page 377, Public Records
of ▇▇▇▇▇▇▇ County, Florida.
3. Easement contained in the instrument dated March 21, 1960, and
recorded June 21, 1960, in O.R. Book 66, Page 314, Public Records of
▇▇▇▇▇▇▇ County, Florida.
4. Easement contained in the instrument recorded December 18, 1975 in
O.R. Book 637, Page 1366, Public Records of ▇▇▇▇▇▇▇ County, Florida.
▇. ▇▇▇▇▇▇▇▇ PROPERTY
[NOT YET APPROVED BY BUYER]
▇. ▇▇▇▇▇▇▇▇▇▇ PROPERTY
[NOT YET APPROVED BY BUYER]
▇. ▇▇▇▇ BLOOMFIELD HILLS PROPERTY
[NOT YET APPROVED BY BUYER]
-6-
EXHIBIT FF
CONSTRUCTION PERMITS AND CONTRACTS
[TO BE COMPLETED BY SELLER]
EXHIBIT G
DEVELOPMENT FEES
FACILITY DEVELOPMENT FEE
-------- ---------------
Naples Facility NONE
Carmel Facility NONE
Dublin Facility NONE
Germantown Facility NONE
Birmingham Facility $331,306
Overland Park Facility $364,269
Hockessin Facility NONE
Blue ▇▇▇▇ Facility $454,302
Richmond Facility NOT YET DETERMINED
▇▇▇▇▇▇▇▇▇▇ Facility NOT YET DETERMINED
West Bloomfield Facility NOT YET DETERMINED
EXHIBIT H
ENVIRONMENTAL SITE ASSESSMENT REPORTS
1. Phase I Environmental Site Assessment Report, dated April 1, 1998, for
Proposed National Assisted Living Facility, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇, PA; prepared by Storb Environmental
Incorporated.
2. Draft Phase I Environmental Site Assessment Report, dated December 13,
1996, for 5.5 Acre Vacant Parcel, Meridian Technology Center, Carmel, IN,
ATC/ATEC Project No. 02460.0001, Task 3; prepared by ATC Associates, Inc.
3. Phase I Environmental Site Assessment, dated ▇▇▇▇▇, ▇▇▇▇, for ▇▇▇▇
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇; prepared by BBC&M Engineering, Inc.
4. Phase I Environmental Site Assessment, dated ▇▇▇▇▇, ▇▇▇▇, for ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇, PEC Project No. 14708; prepared by ▇▇▇▇▇▇▇▇▇
Environmental Consultants, Inc.
5. Level I Environmental Site Assessment, dated ▇▇▇▇▇, ▇▇▇▇, for National
Assisted Living Turnberry Road Site, NW Side - Turnberry Road, Chesterfield
County, VA, Job No. 17687-20; prepared by ▇▇▇▇▇▇▇.
6. Phase II Limited Site Characterization Report, dated March 10, 1998, for
National Assisted Living, ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇; prepared by
Storb Environmental Incorporated.
7. Phase I Environmental Site Assessment Report, dated April 30, 1996, for
Property Located at ▇▇▇▇ ▇▇▇▇▇▇▇▇▇- ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇, ▇▇, PSI No.
375-6E078; prepared by Professional Service Industries, Inc.
8. Phase I Environmental Site Assessment, dated August 5, 1997, for Proposed
Assisted Living Center, Corporate Ridge Road, Birmingham, AL, Project No.
97ENAT02A01; prepared by Gallet & Associates, Inc.
9. Phase I Environmental Site Assessment Report, dated November 10, 1997, for
Proposed Building Site, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇▇ ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇
▇▇▇▇, ▇▇, ▇▇. ▇▇▇▇▇▇; prepared by GeoSystems Engineering, Inc.
10. The ▇▇▇▇▇▇▇▇▇▇ Environmental Report (hereafter approved by the Buyer)
11. West Bloomfield Hills Report (hereafter approved by the Buyer)
EXHIBIT I-1
MAXIMUM AMOUNT TO BE ADVANCED
UNDER DEVELOPMENT AGREEMENTS
FACILITY MAXIMUM AMOUNT
-------- --------------
Naples Facility NOT APPLICABLE
Carmel Facility NOT APPLICABLE
Dublin Facility
Germantown Facility
Birmingham Facility
Overland Park Facility
Hockessin Facility
Blue ▇▇▇▇ Facility NOT YET DETERMINED
Richmond Facility NOT YET DETERMINED
▇▇▇▇▇▇▇▇▇▇ Facility NOT YET DETERMINED
West Bloomfield Facility NOT YET DETERMINED
EXHIBIT I-2
APPROVED BUYER CONTINGENCIES AND
APPROVED LENDER CONTINGENCIES
APPROVED BUYER APPROVED LENDER
FACILITY CONTINGENCY CONTINGENCY
-------- ----------- -----------
Naples Facility NOT APPLICABLE NOT APPLICABLE
Carmel Facility NOT APPLICABLE NOT APPLICABLE
Dublin Facility
Germantown Facility
Birmingham Facility
Overland Park Facility
Hockessin Facility
Blue ▇▇▇▇ Facility
Richmond Facility
▇▇▇▇▇▇▇▇▇▇ Facility
West Bloomfield Facility
EXHIBIT I-3
CONTINGENCY ADJUSTMENT
CONTINGENCY
FACILITY ADJUSTMENT
-------- ----------
Naples Facility NOT APPLICABLE
Carmel Facility NOT APPLICABLE
Dublin Facility $354,550
Germantown Facility $324,999
Birmingham Facility $219,982
Overland Park Facility $419,118
Hockessin Facility $109,553
Blue ▇▇▇▇ Facility NOT YET DETERMINED
Richmond Facility NOT YET DETERMINED
▇▇▇▇▇▇▇▇▇▇ Facility NOT YET DETERMINED
West Bloomfield Facility NOT YET DETERMINED
EXHIBIT J
PRIMARY INTENDED USE
PROPERTY PRIMARY INTENDED USE
-------- --------------------
Naples Property The use of the Naples Property as a facility with
units and such ancillary uses as are permitted by
law and may be necessary in connection therewith
or incidental thereto.
Carmel Property The use of the Carmel Property as a facility with
units and such ancillary uses as are permitted by
law and may be necessary in connection therewith
or incidental thereto.
Dublin Property The use of the Dublin Property as a facility with
units and such ancillary uses as are permitted by
law and may be necessary in connection therewith
or incidental thereto.
Germantown Property The use of the Germantown Property as a facility
with units and such ancillary uses as are
permitted by law and may be necessary in
connection therewith or incidental thereto.
Birmingham Property The use of the Birmingham Property as a facility
with units and such ancillary uses as are
permitted by law and may be necessary in
connection therewith or incidental thereto.
Overland Park Property The use of the Overland Park Property as a
facility with units and such ancillary uses as are
permitted by law and may be necessary in
connection therewith or incidental thereto.
Hockessin Property The use of the Hockessin Property as a facility
with units and such ancillary uses as are
permitted by law and may be necessary in
connection therewith or incidental thereto.
Blue ▇▇▇▇ Property The use of the Blue ▇▇▇▇ Property as a facility
with units and such ancillary uses as are
permitted by law and may be necessary in
connection therewith or incidental thereto.
Richmond Property The use of the Richmond Property as a facility
with units and such ancillary uses as are
permitted by law and may be necessary in
connection therewith or incidental thereto.
▇▇▇▇▇▇▇▇▇▇ Property The use of the ▇▇▇▇▇▇▇▇▇▇ Property as a facility
with units and such ancillary uses as are
permitted by law and may be necessary in
connection therewith or incidental thereto.
West Bloomfield Hills Property The use of the West Bloomfield Hills Property as a
facility with units and such ancillary uses as are
permitted by law and may be necessary in
connection therewith or incidental thereto.
[TO BE COMPLETED BY SELLER - KINDLY DESCRIBE WITH
SPECIFICITY ALL USES/SPECIAL SERVICES USING
APPROPRIATE LICENSURE CATEGORIES]
EXHIBIT K
OPERATING PERMITS
FACILITY OPERATING PERMITS
-------- -----------------
Naples Facility
Carmel Facility
Dublin Facility
Germantown Facility
Birmingham Facility
Overland Park Facility
Hockessin Facility
Blue ▇▇▇▇ Facility
Richmond Facility
▇▇▇▇▇▇▇▇▇▇ Facility
West Bloomfield Facility
[TO BE COMPLETED BY SELLER - KINDLY IDENTIFY EACH TYPE
OF LICENSE NECESSARY AND THE GOVERNMENTAL AUTHORITY
THAT MUST ISSUE IT]
EXHIBIT L
CONSENTS
NONE
EXHIBIT M
CERTIFICATE REGARDING SELLER'S
REPRESENTATIONS, WARRANTIES AND COVENANTS
Reference is hereby made to that certain Agreement Regarding Acquisition of
Facilities, dated as of July 17, 1998 (the "Purchase and Sale Agreement"), by
and between National Assisted Living Limited Partnership, a Florida limited
partnership (the "Seller"), as seller and CareMatrix of Massachusetts, Inc., a
Delaware corporation (the "Buyer"), as buyer. The undersigned hereby certifies
to the Buyer [or the Buyer's Nominee] as follows:
There are no changes in the representations and warranties made
by the Seller in the Purchase and Sale Agreement relating to the
Seller [if, applicable, add reference to any Single Purpose Entity]
or the Property (as defined in the Purchase and Sale Agreement)
[or, list changes here].
This Certification is being given to the Buyer [or the Buyer's Nominee]
incident to the consummation of the sale of the Seller's interest in the
Property [or the Seller's equity interest in ] and it is intended that the Buyer
[or the Buyer's Nominee] shall rely upon the contents and accuracy of this
Certification.
EXECUTED as a sealed instrument as of this __ day of _________.
NATIONAL ASSISTED LIVING LIMITED
PARTNERSHIP, a Florida limited partnership
By: NATIONAL ASSISTED LIVING, INC., a
Florida corporation, its sole general partner
By: ________________________________
Name:
Title:
EXHIBIT N
ESCROW ACCOUNTS
NONE
EXHIBIT O
ADDITIONAL LETTERS OF CREDIT
REQUIRED UNDER EXISTING
LEASE DOCUMENTS
[TO BE COMPLETED BY SELLER]
EXHIBIT P
▇▇▇▇ OF SALE
For good and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, NATIONAL ASSISTED LIVING LIMITED PARTNERSHIP, a Florida
limited partnership (the "Seller"), hereby sells, assigns, transfers and conveys
to CAREMATRIX OF MASSACHUSETTS, INC., a Delaware corporation [or Buyer's
Nominee] (the "Buyer"), all machinery, apparatus, appliances, chattels,
equipment, furniture, fittings, fixtures, draperies, curtains, tools, supplies
and all other articles of personal property of every kind and nature whatsoever
owned by the Seller and located in or upon, or used in connection with the
operation of the land, or any portion thereof, now known and numbered as
_________________________________, more particularly described in EXHIBIT A
attached hereto, or any of the buildings, structures or improvements now or
hereafter located thereon.
Such property is hereby sold, assigned, transferred and conveyed "as-is"
without warranty or representation, (including, without limitation, those of
merchantability or fitness for any particular purpose), except as set forth in
that certain Agreement Regarding Acquisition of Facilities dated as of July 17,
1998 by and between the Seller and the Buyer [CareMatrix of Massachusetts, Inc.,
if Buyer is a Nominee].
IN WITNESS WHEREOF, the Seller has executed this ▇▇▇▇ of Sale, under seal,
as of the __ day of __________.
NATIONAL ASSISTED LIVING LIMITED
PARTNERSHIP, a Florida limited partnership
By: NATIONAL ASSISTED LIVING, INC., a
Florida corporation, its sole general partner
By: ________________________________
Name:
Title:
EXHIBIT Q
GENERAL ASSIGNMENT
In consideration of the payment of the purchase price (and for other good
and valuable consideration paid, the receipt and sufficiency of which are hereby
acknowledged) in connection with the sale of the [leasehold interest in]
property now known and numbered as _____________________, more particularly
described in EXHIBIT A attached hereto (the "Property"), [created pursuant to
INSERT DESCRIPTION OF FACILITY LEASE], the undersigned NATIONAL ASSISTED LIVING
LIMITED PARTNERSHIP, a Florida limited partnership (the "Assignor"), hereby
sells, assigns, transfers, grants and conveys unto CAREMATRIX OF MASSACHUSETTS,
INC., a Delaware corporation [or Buyer's Nominee] (the "Assignee"), all of the
Assignor's right, title and interest in and to any and all Intangible Property
(other than the Permits, the Leases relating to the Property, the Lease
Documents and the Operating Agreements relating to the Property) owned by the
Assignor and relating to and/or used in connection with the Property and/or the
Tangible Personal Property relating thereto, excluding, however, all trademarks
and trade names relating thereto.
This General Assignment is made pursuant to that certain Agreement
Regarding Acquisition of Facilities, dated as of ________, 1998, by and between
the Assignor, as Seller, and the Assignee [CareMatrix of Massachusetts, Inc. if
Buyer is a Nominee], as Buyer (the "Purchase and Sale Agreement"), and is given
without warranty or representation, except as set forth in the Purchase and Sale
Agreement.
All capitalized terms used herein and not expressly defined herein shall
have the meanings given to such terms in the Agreement.
Executed under seal as of the day of .
ASSIGNOR:
NATIONAL ASSISTED LIVING LIMITED
PARTNERSHIP, a Florida limited partnership
By: NATIONAL ASSISTED LIVING, INC., a
Florida corporation, its sole general partner
By: ________________________________
Name:
Title:
EXHIBIT R
ASSIGNMENT AND ASSUMPTION AGREEMENT
In consideration of the payment of the purchase price (and for other good
and valuable consideration paid, the receipt and sufficiency of which are hereby
acknowledged) in connection with the sale of [the leasehold interest in] certain
property known as and numbered , more particularly described in EXHIBIT A
attached hereto (the "Property"), the undersigned NATIONAL ASSISTED LIVING
LIMITED PARTNERSHIP, a Florida limited partnership (the "Assignor"), hereby
sells, assigns, transfers, grants and conveys unto CAREMATRIX OF MASSACHUSETTS,
INC., a Delaware corporation [or Buyer's Nominee] (the "Assignee"), all of the
Assignor's right, title and interest, if any, in and to (a) all of the leases
listed on EXHIBIT B attached hereto, together with any and all other leases,
occupancy agreements, written or oral, affecting the Property, or pursuant to
which all or any portion of the Property is used or occupied by anyone other
than the Assignor and all guaranties of any tenant's obligations thereunder
(collectively, the "Leases"); (b) all of the Assignor's right, title and
interest in and to the contracts and agreements listed on EXHIBIT C attached
hereto (the "Assumed Operating Agreements); and (c) all zoning, building code
and other permits, licenses, authorizations and approvals affecting the
construction and/or use of the Property issued by any and all federal, state,
municipal and other governmental bodies having jurisdiction over the Property,
or any portions thereof (collectively the "Governmental Approvals").
The assignment made pursuant to this Agreement is given without warranty or
representation, except as set forth in that certain Agreement Regarding
Acquisition of Facilities, dated as of July 17, 1998, by and between the
Assignor, as Seller and the Assignee [CareMatrix of Massachusetts, Inc. if
Assignee is a nominee], as Buyer.
The Assignee hereby agrees to and accepts such assignment and, in addition,
expressly assumes and agrees to keep, perform and fulfill all of the terms,
covenants, obligations, and conditions required to be kept, performed and
fulfilled by the Assignor under or with respect to the Leases, the Assumed
Operating Agreements and the Governmental Approvals which arise or accrue on or
after the date hereof. The Assignor agrees to keep, perform and fulfill all of
the terms, covenants, obligations, and conditions required to be kept, performed
and fulfilled by the Assignor under or with respect to the Leases, the Assumed
Operating Agreements and the Governmental Approvals which arise or accrue prior
to the date hereof. Each party further agrees to protect, indemnify, defend and
hold harmless the other party from and against any and all of the following
matters (collectively, the "Indemnified Matters"): claims, demands, actions,
lawsuits, proceedings, judgments, liabilities, losses, costs, damages and
expenses (including reasonable attorneys' fees and costs) directly or indirectly
arising out of or related to any breach or default in such party's obligations
under this paragraph and the
enforcement of the provisions hereof. Each party agrees to promptly notify the
other in writing upon learning of any such claim or cause of action.
In the event that any action, suit or proceeding is brought against any
party (the "Indemnitee") with respect to any Indemnified Matter, the action,
suit or proceeding shall, at the written election made by the other party (the
"Indemnitor") within fifteen (15) "Business Days" (as such term is hereinafter
defined) after the Indemnitor's receipt of written notice of the commencement of
such action, suit or proceeding, be defended by the Indemnitor (including all
proceedings on appeal or for review in connection therewith) at the Indemnitor's
expense and liability. Pending the Indemnitor's election hereunder, the
Indemnitee shall have the right to employ its own counsel to file a request for
an extension of time to file an answer, or to file an answer if the Indemnitor
fails to have its counsel file an answer within three (3) Business Days prior to
the expiration of the period within which an answer must be filed, as such
period may be extended. The Indemnitee shall have the right to employ its own
counsel, for the duration of such action, suit or proceeding, but the fees and
expenses of such counsel shall be at the expense of the Indemnitee unless the
Indemnitor has not elected within the required time period to defend any such
action, suit or proceeding, or unless the actions or inactions by counsel
retained by the Indemnitor appear reasonably likely to result in a judgment
against the Indemnitee because of a failure to defend the action in a reasonably
prudent manner (the burden to prove the same by a preponderance of the evidence
to rest with the Indemnitee), in which event the Indemnitor shall pay such
counsel's fees and expenses. The Indemnitor shall keep the Indemnitee reasonably
informed of any action, suit or proceeding at all stages thereof, whether or not
it represented by its own counsel.
As used in this Agreement, the term "Business Day" shall any day which is
not a Saturday or a Sunday or a public holiday under the laws of the United
States of America or the Commonwealth of Massachusetts.
The provisions of this Agreement shall be binding upon and inure to the
benefit of the Assignor and the Assignee and their respective successors and
permitted assigns.
Executed under seal as of the day of ____________.
ASSIGNOR:
NATIONAL ASSISTED LIVING LIMITED
PARTNERSHIP, a Florida limited partnership
By: NATIONAL ASSISTED LIVING, INC., a
Florida corporation, its sole general partner
By: ________________________________
Name:
Title:
ASSIGNEE:
______________, a Delaware corporation
By: ____________________________
Name:
Title:
-3-
EXHIBIT S
ASSIGNMENT OF MEMBERSHIP INTEREST
THIS ASSIGNMENT OF MEMBERSHIP INTEREST is entered into this day of
________________, between NATIONAL ASSISTED LIVING LIMITED PARTNERSHIP, a
Florida limited partnership (the "ASSIGNOR"), CAREMATRIX OF MASSACHUSETTS, INC.,
a Delaware corporation [SUBSTITUTE NAME OF NOMINEE, IF APPLICABLE] (the
"ASSIGNEE") and [INSERT APPLICABLE SINGLE PURPOSE ENTITY], a Delaware limited
liability company (the "LLC").
WHEREAS, ASSIGNOR owns one hundred percent (100%) of the membership
interests (the "Membership Interest") in and to the LLC, and desires to assign
and transfer the Membership Interest to ASSIGNEE, and ASSIGNEE desires to
purchase the Membership Interest from ASSIGNOR.
NOW THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the parties hereby agree as
follows:
1. ASSIGNOR hereby sells, assigns, transfers and delivers to ASSIGNEE, and
ASSIGNEE hereby accepts, the Membership Interest. Following this assignment,
ASSIGNOR will have no interest in and to the LLC.
2. ASSIGNEE hereby accepts and adopts all of the terms and provisions of
the operating agreement and certificate of organization of the LLC, each as
amended and restated as of the date hereof (collectively, the "LLC Agreement"),
and agrees to be bound thereby.
3. ASSIGNOR hereby covenants and represents to ASSIGNEE that (a) ASSIGNOR
has good and sufficient title to the Membership Interest, free and clear of all
mortgages, liens, pledges, charges, claims, encumbrances, or rights, title and
interest in others except [REFERENCE LIENS CREATED BY APPLICABLE LEASE DOCUMENTS
OR FUTURE FINANCING DOCUMENTS], (b) ASSIGNOR has complete authority to execute
this Assignment and perform the terms hereof, (c) the execution and delivery of
this Assignment and the performance of the terms hereof by ASSIGNOR will not
contravene any agreement to which ASSIGNOR or its properties is or may be bound,
(d) there exists no default, or event which with the passage of time or notice
or both could become a default, under the LLC Agreement, (e) ASSIGNOR has no
obligations or liabilities to the LLC of any nature, and (f) ASSIGNOR is not a
"foreign person" within the meaning of Section 1445(f) of the Internal Revenue
Code of 1986, as amended.
-3-
4. ASSIGNOR hereby remises, releases and forever discharges the LLC and its
successors and assigns (collectively, the "Assignor Releasees"), of and from all
claims, actions, causes of action, suits, accounts, covenants, contracts,
agreements, damages, debts, demands and liabilities whatsoever of every name and
nature, both at law and in equity, which against the Assignor Releasees, or any
of them, ASSIGNOR now has or ever has had from the beginning of time to this
date arising out of or relating to the LLC or the LLC Agreement.
5. The LLC hereby remises, releases and forever discharges ASSIGNOR and its
successors and assigns (collectively, the "LLC Releasees"), of and from all
claims, actions, causes of action, suits, accounts, covenants, contracts,
agreements, damages, debts, demands and liabilities whatsoever of every name and
nature, both at law and in equity, which against the LLC Releasees, or any of
them, the LLC now has or ever has had from the beginning of time to this date
arising out of or relating to the LLC or the LLC Agreement.
WITNESS the execution hereof under seal as of the day and year first above
written.
ASSIGNOR:
NATIONAL ASSISTED LIVING LIMITED
PARTNERSHIP, a Florida limited partnership
By: National Assisted Living, Inc., a Florida
corporation, its sole general partner
By:_______________________________________
Name:
Title:
ASSIGNEE:
CAREMATRIX OF MASSACHUSETTS, INC., a
Delaware corporation
By:_______________________________________
Name:
Title:
-2-
-3-
LLC:
___________________, a Delaware limited liability
company
By: NATIONAL ASSISTED LIVING LIMITED
PARTNERSHIP, a Florida limited partnership,
its sole member
By: NATIONAL ASSISTED LIVING, INC., a
Florida corporation, its sole general partner
By:_______________________________________
Name:
Title:
-4-
SCHEDULE 6.7
FINANCIAL STATEMENTS
AGREEMENT REGARDING ACQUISITION OF FACILITIES
BY AND BETWEEN
NATIONAL ASSISTED LIVING LIMITED PARTNERSHIP
AND
CAREMATRIX OF MASSACHUSETTS, INC.
DATED AS OF JULY 17, 1998
TABLE OF CONTENTS
1. Definitions..............................................................................................2
2. Call Rights, Put Rights and Transfer Rights.............................................................38
2.1 Call Option....................................................................................38
2.2 Put Option.....................................................................................39
2.3 Transfer Right.................................................................................39
3. Option Payments.........................................................................................40
4. Facility Purchase Price.................................................................................40
5. Place of Closing........................................................................................42
6. Seller's Representations and Warranties.................................................................42
6.1 Legal Existence, Good Standing and Ownership Interest..........................................43
6.2 Authority and Enforceability...................................................................44
6.3 No Conflict....................................................................................45
6.4 No Consent or Approval.........................................................................45
6.5 Financial Condition............................................................................46
6.6 Filing of Tax Returns..........................................................................47
6.7 Accuracy of Financial Statements and Other Information.........................................48
6.8 Pending Actions, Notices and Reports...........................................................48
6.9 Compliance with Legal and Other Requirements...................................................49
6.10 Property Matters...............................................................................50
6.11 Hazardous Substances...........................................................................52
6.12 Labor Matters..................................................................................53
6.13 Intellectual Property..........................................................................54
6.14 Management Agreements..........................................................................54
6.15 Omnibus Letter Agreement, the Richmond Architect's Agreement,
the West Bloomfield Hills Architect's Agreement and
Existing Construction Contracts................................................................54
6.16 Future Architect's Agreements and Future Construction Contracts................................55
6.17 Existing Project Plans.........................................................................55
6.18 Plans and Specifications Relating to the Blue ▇▇▇▇ Property....................................56
6.19 Plans and Specifications Relating to the Richmond Property.....................................56
6.20 Plans and Specifications Relating to the West Bloomfield Hills Property........................57
6.21 Plans and Specifications Relating to the ▇▇▇▇▇▇▇▇▇▇ Property...................................57
6.22 Prior Construction Work........................................................................58
6.23 Suitability of the Existing Project Plans......................................................58
(i)
6.24 Suitability of the Plans and Specifications Relating to the
Blue ▇▇▇▇ Development Project .................................................................58
6.25 Suitability of the Plans and Specifications Relating to the
Richmond Development Project ..................................................................58
6.26 Suitability of Project Plans Relating to the
West Bloomfield Hills Development Project .....................................................59
6.27 Suitability of Project Plans Relating to the
▇▇▇▇▇▇▇▇▇▇ Development Project ................................................................59
6.28 Compliance with Legal Requirements and Applicable Agreements ..................................59
6.29 Permits and Contracts..........................................................................59
6.30 Leases.........................................................................................60
6.31 Default under Lease Documents..................................................................61
6.32 Landlord Bankruptcy............................................................................61
6.33 Existing Lease Documents.......................................................................61
6.34 Existing Letters of Credit.....................................................................62
6.35 Development Proceeds...........................................................................62
6.36 Personal Property..............................................................................62
6.37 Insurance Notices..............................................................................63
6.38 Additional Representations Regarding the Naples Property.......................................63
6.39 Additional Representations Regarding the Carmel Property.......................................63
6.40 Additional Representations Regarding the Dublin Property.......................................64
6.41 Additional Representations Regarding the Germantown Property...................................65
6.42 Additional Representations Regarding the Birmingham Property...................................66
6.43 Additional Representations Regarding the Overland Park Property................................66
6.44 Additional Representations Regarding the Hockessin Property....................................67
6.45 Additional Representations Regarding the Blue ▇▇▇▇ Property....................................68
6.46 Additional Representations Regarding the Richmond Property.....................................69
6.47 Year 2000......................................................................................69
6.48 Contingencies..................................................................................69
6.49 Beneficiaries..................................................................................69
7. Buyer's Representations and Warranties..................................................................69
7.1 Legal Existence and Good Standing..............................................................69
7.2 Authority and Enforceability...................................................................69
7.3 No Conflict....................................................................................70
7.4 CareMatrix Approval............................................................................70
7.5 CareMatrix Net Worth...........................................................................70
8. Covenants...............................................................................................70
8.1 Maintenance of Existence; Organizational Documents ............................................70
8.2 Single Purpose Entities........................................................................70
8.3 Financial Statements and Other Information.....................................................71
8.4 Books and Records..............................................................................73
(ii)
8.5 Restrictions...................................................................................74
8.6 Non-Competition................................................................................74
8.7 Employees......................................................................................76
8.8 Changes in Fiscal Year and Accounting Procedures...............................................76
8.9 Impositions....................................................................................76
8.10 Permitted Contests.............................................................................77
8.11 Repair; Use; Compliance With Law; Alterations; Waste...........................................77
8.12 Construction Covenants.........................................................................79
8.13 Lease Transactions and Future Financings. ....................................................86
8.14 Additional Provisions Regarding Future Financings..............................................88
8.15 Management Agreements..........................................................................89
8.16 Leases and Resident Agreements.................................................................89
8.17 Operating Agreements...........................................................................89
8.18 ▇▇▇▇-▇▇▇▇▇-▇▇▇▇▇▇..............................................................................90
8.19 Buyer's Transfer Approvals.....................................................................90
8.20 Title Matters..................................................................................91
8.21 Insurance......................................................................................91
8.22 Casualty.......................................................................................91
8.23 Condemnation...................................................................................92
8.24 Additional Covenants Relating to the Carmel Property...........................................93
8.25 Additional Covenants Relating to the Germantown Property.......................................93
8.26 Additional Covenants Relating to the Birmingham Property.......................................93
8.27 Additional Covenants Relating to the Hockessin Property........................................93
8.28 Additional Covenants Relating to the Blue ▇▇▇▇ Property........................................94
8.29 Additional Covenants Relating to the Richmond Property.........................................94
8.30 Additional Covenants Relating to the ▇▇▇▇▇▇▇▇▇▇ Property.......................................94
8.31 Additional Covenants Relating to the West Bloomfield Hills Property............................94
8.32 Seller Documents and Buyer Documents...........................................................94
8.33 Compliance with Legal Requirements.............................................................94
8.34 Reliance Letters...............................................................................95
8.35 Surveys........................................................................................95
8.36 CareMatrix Net Worth...........................................................................95
8.37 Naples Abutters................................................................................95
8.38 Architect's....................................................................................95
8.39 Buyer Approvals................................................................................95
9. Closing Deliveries......................................................................................96
9.1 Closing Deliveries Relating to All Closings ...................................................96
9.2 Closing Deliveries In Connection with Any Closing
Relating to any Facility Leased By the Seller .................................................97
9.3 Closing Deliveries in Connection With Any Closing
Relating to Any Facility Leased or Owned by
Any Single Purpose Entity .....................................................................98
(iii)
9.4 Closing Deliveries In Connection With Any Closing
Relating to Any Facility Owned By The Seller ..................................................98
9.5 Additional Closing Deliveries Relating to the Naples Closing ..................................99
9.6 Additional Closing Deliveries Relating to the Carmel Closing...................................99
9.7 Additional Closing Deliveries Relating to the Dublin Closing..................................100
9.8 Additional Closing Deliveries Relating to the Germantown Closing..............................101
9.9 Additional Closing Deliveries Relating to the Birmingham Closing..............................101
9.10 Additional Closing Deliveries Relating to the Overland Park Closing...........................102
9.11 Additional Closing Deliveries Relating to the Hockessin Closing...............................102
9.12 Additional Closing Deliveries Relating to the Blue ▇▇▇▇ Closing...............................103
9.13 Additional Closing Deliveries Relating to the Richmond Closing................................103
9.14 Additional Closing Deliveries Relating to the ▇▇▇▇▇▇▇▇▇▇ Closing..............................104
9.15 Additional Closing Deliveries Relating to the West Bloomfield Hills
Closing ......................................................................................104
10. Conditions Precedent to All Closings...................................................................104
10.1 Buyer's Transfer Approvals ....................................................................105
10.2 Representations, Warranties and Covenants. ...................................................105
10.3 Physical Condition of the Facility............................................................105
10.4 Environmental Condition.......................................................................105
10.5 Operating Agreements..........................................................................105
10.6 Possession....................................................................................105
10.7 Buyer's Title Insurance Policies..............................................................106
10.8 Lease Documents and Future Financing Documents................................................106
10.9 Lease Default or Future Financing Default.....................................................106
10.10 HSR Act.......................................................................................106
10.11 Condemnation..................................................................................106
10.12 Non-Competition Agreement.....................................................................106
10.13 Dispute Regarding the Seller's Calculation of the
Facility Purchase Price or the Achievement of Breakeven ......................................107
10.14 Survey Matters. ..............................................................................107
10.15 License of Intellectual Property..............................................................107
11. Additional Conditions Precedent to Specific Closings...................................................107
11.1 Conditions Precedent to the Naples Closing ...................................................107
11.2 Conditions Precedent to the Carmel Closing....................................................108
11.3 Conditions Precedent to the Dublin Closing....................................................108
11.4 Conditions Precedent to the Germantown Closing................................................108
11.5 Conditions Precedent to the Birmingham Closing................................................109
11.6 Conditions Precedent to the Overland Park Closing.............................................109
11.7 Conditions Precedent to the Blue ▇▇▇▇ Closing.................................................109
11.8 Conditions Precedent to the Richmond Closing..................................................110
11.9 Conditions Precedent to ▇▇▇▇▇▇▇▇▇▇ Closing....................................................110
(iv)
11.10 Conditions Precedent to West Bloomfield Hills Closing.........................................111
12. Extensions.............................................................................................112
13. Indemnification........................................................................................113
14. Adjustments and Prorations to be Made at Each Closing..................................................116
15. Costs..................................................................................................118
16. Brokerage Warranty.....................................................................................118
17. Recording..............................................................................................119
18. Remedies...............................................................................................119
19. Waiver.................................................................................................119
20. Time...................................................................................................120
21. Governing Law and Consent to Jurisdiction..............................................................120
22. Notices................................................................................................120
23. Entire Agreement.......................................................................................121
24. Access.................................................................................................122
25. Publicity..............................................................................................122
26. General Provisions.....................................................................................122
27. WAIVER BY JURY TRIAL...................................................................................123
28. Captions and Headings..................................................................................123
29. Counterparts...........................................................................................123
30. No Joint Venture or Partnership........................................................................123
31. Amendments, Waivers and Modifications..................................................................123
32. Successors and Assigns.................................................................................124
(v)
33. No Third Party Beneficiaries...........................................................................124
34. Further Assurances.....................................................................................124
35. Cooperation............................................................................................124
36. No Solicitation........................................................................................125
37. Exhibits and Schedules.................................................................................125
EXHIBIT A-1 BIRMINGHAM REAL PROPERTY
EXHIBIT A-2 BLUE ▇▇▇▇ REAL PROPERTY
EXHIBIT A-3 CARMEL REAL PROPERTY
EXHIBIT A-4 DUBLIN REAL PROPERTY
EXHIBIT A-5 GERMANTOWN REAL PROPERTY
EXHIBIT A-6 HOCKESSIN REAL PROPERTY
EXHIBIT A-7 NAPLES REAL PROPERTY
EXHIBIT A-8 OVERLAND PARK REAL PROPERTY
EXHIBIT A-9 RICHMOND REAL PROPERTY
EXHIBIT A-10 ▇▇▇▇▇▇▇▇▇▇ REAL PROPERTY
EXHIBIT A-11 WEST BLOOMFIELD HILLS REAL PROPERTY
EXHIBIT B-1 BIRMINGHAM BUDGET
EXHIBIT B-2 BLUE ▇▇▇▇ BUDGET
EXHIBIT B-3 CARMEL BUDGET
EXHIBIT B-4 DUBLIN BUDGET
EXHIBIT B-5 GERMANTOWN BUDGET
(vi)
EXHIBIT B-6 HOCKESSIN BUDGET
EXHIBIT B-7 NAPLES BUDGET
EXHIBIT B-8 OVERLAND PARK BUDGET
EXHIBIT B-9 RICHMOND BUDGET
EXHIBIT B-10 ▇▇▇▇▇▇▇▇▇▇ BUDGET
EXHIBIT ▇-▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ BUDGET
EXHIBIT C-1 BIRMINGHAM PLANS AND SPECIFICATIONS
EXHIBIT C-2 BLUE ▇▇▇▇ PLANS AND SPECIFICATIONS
EXHIBIT C-3 CARMEL PLANS AND SPECIFICATIONS
EXHIBIT C-4 DUBLIN PLANS AND SPECIFICATIONS
EXHIBIT C-5 GERMANTOWN PLANS AND SPECIFICATIONS
EXHIBIT C-6 HOCKESSIN PLANS AND SPECIFICATIONS
EXHIBIT C-7 NAPLES PLANS AND SPECIFICATIONS
EXHIBIT C-8 OVERLAND PARK PLANS AND SPECIFICATIONS
EXHIBIT C-9 RICHMOND PLANS AND SPECIFICATIONS
EXHIBIT C-10 ▇▇▇▇▇▇▇▇▇▇ PLANS AND SPECIFICATIONS
EXHIBIT C-11 WEST BLOOMFIELD HILLS PLANS AND SPECIFICATIONS
EXHIBIT D EXISTING LEASE DOCUMENTS
EXHIBIT E PERMITTED ENCUMBRANCES
EXHIBIT F CONSTRUCTION PERMITS AND CONTRACTS
EXHIBIT G DEVELOPMENT FEES
EXHIBIT H ENVIRONMENTAL SITE ASSESSMENT REPORTS
(vii)
EXHIBIT I-1 MAXIMUM AMOUNT TO BE ADVANCED
UNDER DEVELOPMENT AGREEMENTS
EXHIBIT I-2 APPROVED BUYER CONTINGENCIES AND
APPROVED LENDER CONTINGENCIES
EXHIBIT I-3 CONTINGENCY ADJUSTMENT
EXHIBIT J PRIMARY INTENDED USE
EXHIBIT K OPERATING PERMITS
EXHIBIT L CONSENTS
EXHIBIT M CERTIFICATE REGARDING SELLER'S REPRESENTATIONS,
WARRANTIES AND COVENANTS
EXHIBIT N ESCROW ACCOUNTS
EXHIBIT O ADDITIONAL LETTERS OF CREDIT REQUIRED UNDER
EXISTING LEASE DOCUMENTS
EXHIBIT P ▇▇▇▇ OF SALE
EXHIBIT Q GENERAL ASSIGNMENT
EXHIBIT R ASSIGNMENT AND ASSUMPTION AGREEMENT
EXHIBIT S ASSIGNMENT OF MEMBERSHIP INTEREST
SCHEDULE 6.7 FINANCIAL STATEMENTS
(viii)