1
EXHIBIT 10.61
(Harrisburg)
This instrument prepared by:
Xxxxxxx X. Xxxxx
Xxxxxxxx Xxxxxx Xxxxxxx & Xxxxxx LLP
0000 Xxxxx Xxxxxx Xxxxx
0000 XxXxxxx/Xxxxxxx Xxxxx
Xxxxxxxxxx, Xxxxxxx 00000
(000) 000-0000
STATE OF __________________)
COUNTY OF ________________)
ASSIGNMENT, ASSUMPTION AND AMENDMENT OF LEASE AGREEMENT
THIS ASSIGNMENT, ASSUMPTION AND AMENDMENT OF LEASE AGREEMENT
("Assignment") made as of the 6th day of February, 1998, by and among
SENIOR CARE OPERATORS, LLC, a Delaware Limited Liability Company ("Assignor"),
BCC AT HARRISBURG, INC., a Delaware corporation ("Manager"), EXTENDED CARE
OPERATORS OF HARRISBURG, LLC, a Delaware limited liability company ("Assignee"),
and Capstone Capital of Pennsylvania, Inc., a Pennsylvania corporation
("Owner").
R E C I T A L S
WHEREAS, Owner, as lessor and Manager, as lessee, entered into that
certain lease agreement dated March 28, 1997 (the "Lease"), covering that
certain 51-unit assisted living facility located in Harrisburg, Pennsylvania,
which is located on real property more particularly described in Exhibit A
attached hereto (the "Facility"); and
WHEREAS, Manager assigned the Lease to Assignor pursuant to an
Assignment and Assumption Agreement dated as of December 30, 1997 (the "Prior
Assignment Agreement")
WHEREAS, Assignor desires to assign to Assignee and Assignee desires to
assume, all of Assignor's rights, interests, and obligations under the Lease;
and
WHEREAS, Owner agrees to the assignment of the Lease on the condition
that the same be amended as agreed herein.
NOW, THEREFORE, in consideration of the foregoing and other good and
valuable consideration, the receipt of which is hereby acknowledged, and
intending to be bound, Assignor and Assignee hereby agree as follows:
1. Effective as of the date hereof, Assignor conveys, transfers and
assigns unto the Assignee, its successors and assigns, all the rights, interest
and privileges and the obligations,
2
duties and commitments which the Assignor, as lessee, has under the terms of the
Lease.
2. Assignee agrees to assume and perform all the obligations and duties
of Assignor under the Lease, and to be bound by and perform all covenants to be
performed by the lessee thereunder.
3. Assignor agrees to indemnify the Assignee for, and to save it
harmless from, any and all liability, loss or damage which the Assignee might
incur under the Lease, and from any and all claims and demands which may be
asserted against the Assignee thereunder, by virtue of any acts or omissions on
the part of the Assignor which occurred prior to the effective date of this
Assignment.
4. Assignee agrees to indemnify the Assignor for, and to save it
harmless from, any and all liability, loss or damage which the Assignor may
incur under the Lease, and from any and all claims and demands whatsoever which
may be asserted against the Assignor thereunder, by virtue of any acts or
omissions on the part of the Assignee occurring subsequent to the effective date
of this Assignment.
5. It is expressly understood and agreed that Assignor shall have no
liability for the performance of the obligations and covenants set forth in the
Lease following the effective date of this Assignment, and that Assignee shall
have no liability for the performance of the obligations and covenants set forth
in the Lease with respect to the period prior to the effective date of this
Assignment.
6. Assignee agrees that Section 2.6 of the Lease is hereby deleted in
its entirety and the following is substituted therefor:
2.6 MANAGEMENT OF FACILITY
(a) Unless otherwise agreed to in writing by Lessor (i) Lessee shall
cause the Facility to be managed (including any leasing activities) at all times
by Developer or an Affiliate of Developer, (ii) Lessee shall not enter into any
agreement (oral or written) with respect to such management and leasing
activities unless the terms thereof and the proposed manager or leasing agent
have been approved in writing by Lessor, (iii) all such management or leasing
agreements must be in writing and if with an Affiliate of Developer, then the
same shall be guaranteed by Developer, and (iv) all management or leasing
agreements must contain provisions to the effect that (A) the obligation of
Lessee to pay management fees is subordinate to its obligation to pay Rent, and
(B) the manager shall not have the right to collect any management fees during
the continuance of an Event of Default.
(b) In lieu of any similar covenants in the Lease, Balanced Care
Corporation ("BCC") shall contain covenants acceptable to Lessor requiring that
Developer and its Affiliates (including BCC) shall maintain on a consolidated
basis the following:
2
3
(i) a ratio of consolidated current assets to consolidated
current liabilities equal to or greater than 1.0 to 1.0;
(ii) a tangible net worth equal to or greater than $5,000,000,
unless otherwise approved (or waived) by Lessor, approval of which shall not
unreasonably withheld (for purposes of this Section 2.6(b)(ii), the line item
identified as "Mandatorily Redeemable Preferred B Stock" reflected on
Guarantor's consolidated financial statement shall be included in Guarantor's
shareholder's equity).
(iii) a Consolidated Cash Flow Coverage not less than 1.0 to
1.0.
"Consolidated Cash Flow Coverage" shall mean a ratio of (i) earnings
before interest, taxes, depreciation, amortization, rent and its home office
expense minus an assumed five percent (5%) management fee to (ii) all interest
an rent payments.
The covenants of Section 2.6 (b) above shall be included in that
certain Working Capital Assurance Agreement dated as of February 6, 1998
between Lessor and BCC. A default of such covenants shall constitute a default
under the Lease.
(c) In the event that BCC or any affiliate of BCC exercises its right
to purchase the membership interest of Lessee, or the assigns of Lessee, the
covenants contained in Section 2.6(b) above shall be included as an obligation
of BCC or such affiliate under this Lease. In the event that BCC uses an
Affiliate to purchase the membership interests of the Lessee, BCC shall execute
a guaranty of such Affiliate's obligations as Lessee hereunder in a form
substantially the same as executed by the Guarantors hereunder.
(d) GUARANTY/ GUARANTORS. The Rent and other obligations pursuant to
the Lease are guaranteed by the individual owners of all of the membership
interest of Lessee (each, a "Guarantor" and, collectively, "Guarantors")
pursuant to an unlimited guaranty agreement ("Guaranty") executed simultaneously
herewith in favor of Lessor."
7. The terms of this Assignment shall apply to, bind and inure to the
benefit of the parties hereto and their respective successors and assigns.
[SIGNATURES ON FOLLOWING PAGE]
3
4
IN WITNESS WHEREOF, Assignor, Assignee and Owner have executed this
Assignment as of the date first set forth above.
MANAGER:
BCC AT HARRISBURG, INC.,
a Delaware corporation
By: /s/ Xxxxx X. Xxxxx
----------------------------------
Xxxxx X. Xxxxx, Vice President
ASSIGNEE:
EXTENDED CARE OPERATORS OF HARRISBURG, LLC,
a Delaware limited liability company
By: /s/ Signature Illegible
-----------------------------------
Its:
-----------------------------------
OWNER:
CAPSTONE CAPITAL CORPORATION, INC.,
a Maryland corporation
By: /s/ Xxxxx X. XxXxxxx
-------------------------------
Xxxxx X. XxXxxxx, Assistant Vice President
ASSIGNOR:
SENIOR CARE OPERATORS, LLC,
a Delaware limited liability company
By: /s/ Signature Illegible
-------------------------------
Its:
-------------------------------
4
5
Schedule to Exhibit 10.61 filed pursuant to Instruction 2 to Item
601(a) of Regulation S-K
Assignment, Assumption and Amendment of Lease Agreement
Location Entities
Ravenna, OH BCC at Ravenna, Inc.;
Extended Care Operators of Ravenna LLC
Greensboro, NC BCC at Greensboro, Inc.
Extended Care Operators of Greensboro LLC
