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EXHIBIT 10.62
CONSENT AND SUBORDINATION AGREEMENT
THIS AGREEMENT, made as of the 6th day of February, 1998, by and
among EXTENDED CARE OPERATORS OF HARRISBURG, LLC, a Delaware limited liability
company, ("Lessee"), BCC AT HARRISBURG, INC., a Delaware corporation
("Manager"), and CAPSTONE CAPITAL OF PENNSYLVANIA, INC., a Pennsylvania
corporation, its successors and assigns ("Lessor").
R E C I T A L S:
A. Manager and Lessee shall enter into a Management Agreement to be
dated ______________ 1998 (the "Management Agreement") with respect to an
assisted living facility more particularly described in the Management Agreement
("Facility"), located at certain real property in Dauphin County, Pennsylvania
and more particularly described in Exhibit A hereto (the real property and
improvements now or hereafter existing thereat are referred to herein as the
"Property").
B. Lessee has requested that Lessor permit Lessee to accept an
assignment of a lease (the "Lease") with Lessee. As one of the conditions to
permitting the assignment, Lessor required certain agreements from the Manager
and Lessee.
AGREEMENT
NOW, THEREFORE, in consideration of the Recitals and the covenants of
the parties hereto, and as an inducement to Lessor to enter into the Lease, the
parties hereto do mutually agree as follows:
1. All unaccrued, and accrued but unpaid, fees, expenses and other
amounts now or from time to time owing to Manager under the Management Agreement
shall be subordinate to the Lease, interest thereon and all other amounts from
time to time payable by Lessee to Lessor upon the terms and conditions set forth
herein. Any amendments heretofore or hereafter made to the Lease shall not
require the consent of Manager.
2. Provided no Event of Default exists and remains uncured beyond any
applicable cure period (as defined in the Lease), the Lessee shall be entitled
to pay, and Manager shall be entitled to receive, the fees, expenses and other
amounts payable to Manager pursuant to the Management Agreement; provided,
however, Manager and Lessee agree with Lessor (a) not to modify the method for
calculating the fees, expenses and other amounts payable to Manager without
first obtaining the prior written consent of Lessor (which consent shall not
unreasonably be withheld); and (b) not to accrue or pay fees, expenses and other
amounts in excess of one (1) month without first obtaining the prior written
consent of Lessor (which consent shall not unreasonably be withheld).
3. Following an Event of Default that remains uncured beyond any
applicable cure
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period, Lessor may, at its option, elect to terminate or require Lessee to
terminate the Management Agreement without any obligation of Lessor to Manager,
other than those obligations set forth in the Lease (if any) and those required
by law. Manager agrees that it shall not look to Lessor for any sums due it as
of the date of or as a result of such termination.
4. Manager shall timely provide the financial and other reports of the
operations of the Facility and of the Manager as required in the Lease.
5. Manager hereby acknowledges that pursuant to the Lease, Lessee has
assigned to Lessor all of Lessee's rights and interests in the Management
Agreement.
6. Manager hereby consents to the aforesaid assignment and agrees that
if Lessor, or its successors and assigns, becomes in possession of the Facility
through any rights granted under the Lease or at law, Manager shall, at the
option of Lessor, its successors and assigns, continue to honor its duties and
obligations under the Management Agreement for the benefit of the Lessor, its
successors and assigns, provided Lessor agrees to honor Lessee's duties and
obligations owed to the Manager under the Management Agreement.
7. Manager will, upon request, furnish promptly to Lessor at Lessor's
main office in Birmingham, Alabama, copies of the following (to the extent
applicable): all leases, patient and resident agreements, books, records,
monthly reports, statements of account, budgets, evidence of deposits and
withdrawals from any account in which payments (including payments from
Medicare, Medicaid, and private insurance) relating to the Property are
deposited, licenses, Medicare and Medicaid reimbursement agreements, Medicare
and Medicaid surveys, statements of deficiencies and plans of correction,
Medicare and Medicaid cost reports and other items which Manager is required to
maintain under the Management Agreement or which Manager maintains for its own
purposes with respect to the Property.
8. Upon any termination of the Management Agreement, Manager may seek
recourse against Lessee, subject to the subordination contained herein. Manager
shall have no right of specific performance and no lien or charge upon the
Property or income from or relating to the Property so long as Lessor owns the
Property.
9. Manager will notify Lessor promptly of any material default by
Lessee or termination by Lessee under or with respect to the Management
Agreement.
10. If Manager and Lessee should modify the Management Agreement or
enter into a new management agreement, it shall be subject to all provisions
hereof and of the Lease relating to the Management Agreement.
11. This Agreement shall be binding upon Manager and Lessee and their
successors and assigns and shall inure to the benefit of Lessor and its
successors and assigns. Manager and Lessee shall have the right to assign the
Management Agreement to an affiliate of Manager
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or Lessee, as the case may be, without Lessor's consent, provided such
assignment subjects the assignee to all provisions hereof and of the Lease.
12. The validity, interpretation, enforcement and effect of this
Agreement shall, at Lessor's option, be governed by and construed in accordance
with the laws of the State of Alabama or, at Lessor's option, the laws of the
State of Pennsylvania. The Lessor's principal place of business is located in
Jefferson County of the State of Alabama, and the Lessee and Manager agree that
this Agreement shall be held by Lessor at such principal place of business, and
this Agreement shall constitute sufficient minimum contacts of Lessee and
Manager with Jefferson County of the State of Alabama for the purpose of
conferring jurisdiction upon the federal and state courts presiding in such
county and state. Lessee and Manager consent that any legal action or proceeding
arising hereunder may be brought in the Circuit Court of the State of Alabama,
Jefferson County, Alabama in the United States District Court for the Northern
District of Alabama, and assent and submit to the personal jurisdiction of any
such courts in any such action or proceeding. Nothing herein shall limit the
jurisdiction of any other court.
13. In the event any provision hereof is deemed to be invalid by reason
of the operation of any law or by reason of the interpretation placed hereon by
any court, this Agreement shall be construed as not containing such provision,
and the invalidity of such provision shall not affect any other provisions which
are otherwise lawful and valid and shall remain in full force and effect.
14. The failure at any time or times to require strict performance of
any of the provisions, warranties, terms and conditions contained herein or in
any other agreement, document or instrument heretofore, now or hereafter
executed by the Lessee or Manager and delivered to the Lessor shall not waive,
affect or diminish any right of the Lessor to thereafter demand strict
compliance or performance therewith and with respect to any other provisions,
warranties, terms and conditions contained in such agreements, documents and
other instruments, and any waiver of any default shall not waive or affect any
other default, whether prior or subsequent thereto and whether of the same or of
a different type. None of the warranties, conditions, provisions and terms
contained in this Agreement or in any other agreement, document or instrument
heretofore, now or hereafter executed by the Lessee or the Manager and delivered
to the Lessor shall be deemed to have been waived by any act or knowledge of the
Lessor, its agents, officers or employees, but only by an instrument in writing
signed by an officer of the Lessor and directed to the Lessee and Manager
specifying such waiver.
15. In the event at any time or times hereafter the Lessor employs
counsel to advise or provide other representation with respect to this Agreement
or any other agreement, document or instrument heretofore, now or hereafter
executed by the Manager and delivered to the Lessor with respect to the Lessee,
the Manager, the Management Agreement or this Agreement, or to commence, defend,
intervene, file a petition, complaint, answer, motion or
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other pleading or take any other action with respect to any suit or proceeding
relating to this Agreement or any other agreement, instrument or document
heretofore, now or hereafter executed by the Manager and delivered to the Lessor
with respect to the Lessee, the Manager, the Management Agreement or this
Agreement, or to represent Lessor in any litigation with respect to the affairs
of the Manager or to enforce any rights of the Lessor or the obligations of
Manager or Lessee or any other person, firm or corporation which may be
obligated to Lessor by virtue of this Agreement, then in any such events all the
reasonable attorneys' fees arising from such service, including attorneys' fees
in appellate and bankruptcy proceedings, and expenses, costs or charges relating
thereto shall be due and payable to Lessor by Lessee upon Lessor's demand.
16. All notices, demands, or requests, and responses thereto, required
or permitted to be given pursuant to this Agreement or by applicable law shall
be in writing and shall be deemed to have been properly given or served and
shall be deemed received (a) on the date delivered, if sent by hand delivery (to
the person or department if one is specified below), (b) three (3) days
following the date deposited in the United States mall, postage prepaid and
registered or certified with return receipt requested, or (c) one (1) day
following the date deposited with Federal Express or other national overnight
carrier, and in each case addressed as follows:
If to Lessee:
Extended Care Operators of Harrisburg, Inc.
c/o Hakman & Co
0000 Xxx Xxxxxxxx Xxxxxxx; Xxxxx 000
Xxxxxxxxxx, XX 00000
With a copy to:
If to Managers:
BCC at Harrisburg, Inc.
0000 Xxxxxx Xxxxx, Xxxxx 000
Xxxxxxxxxxxxx, Xx. 00000
With a copy to:
Xxxxxx Xxxxxxxx, Esq.
Xxxxxxxxxxx & Xxxxxxxx, LLP
0000 Xxxxxx Xxxxxxxx
Xxxxxxxxxx, Xxxxxxxxxxxx 00000-0000
If to the Lessor to:
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Capstone Capital of Pennsylvania, Inc.
0000 Xxxxx Xxxxxx Xxxxx, Xxxxx 000
Xxxxxxxxxx, Xxxxxxx 00000
Attention: Xx. Xxxxx X. XxXxxxx
With a copy to:
Xxxxxxx X. Xxxxx, Esq.
Xxxxxxxx Xxxxxx Xxxxxxx & Xxxxxx LLP
0000 XxXxxxx/Xxxxxxx Xxxxx
0000 Xxxxx Xxxxxx Xxxxx
Xxxxxxxxxx, Xxxxxxx 00000-0000
or at such other single address in the United States as Lessee, Lessor or
Manager may by notice in writing designate for notice.
17. Lessee and Manager hereby agree that they will not (acting together
or individually) terminate or materially modify the Management Agreement without
Lessor's consent, which consent shall be in the sole discretion of Lessor. This
Agreement shall be deemed to supersede any conflicting provisions of the
Management Agreement.
18. TO THE EXTENT ALLOWED BY APPLICABLE LAW, LESSEE AND MANAGER HEREBY
WAIVE ANY RIGHT THAT THEY MAY HAVE TO A TRIAL BY JURY OR ANY CLAIM,
COUNTERCLAIM, SETOFF, DEMAND, ACTION OR CAUSE OF ACTION (A) ARISING OUT OF OR IN
ANY WAY RELATED TO THIS AGREEMENT OR THE LEASE, OR (B) IN ANY WAY CONNECTED WITH
OR PERTAINING OR RELATED TO OR INCIDENTAL TO ANY DEALINGS OF LESSOR AND/OR
LESSEE AND MANAGER WITH RESPECT TO THE LEASE DOCUMENTS OR IN CONNECTION WITH
THIS AGREEMENT OR THE EXERCISE OF ANY PARTY'S RIGHTS AND REMEDIES UNDER THIS
AGREEMENT OR OTHERWISE, OR THE CONDUCT OR THE RELATIONSHIP OF THE PARTIES
HERETO, IN ALL OF THE FOREGOING CASES WHETHER NOW EXISTING OR HEREAFTER ARISING
AND WHETHER SOUNDING IN CONTRACT, TORT OR OTHERWISE, LESSEE AND MANAGER AGREE
THAT LESSOR MAY FILE A COPY OF THIS AGREEMENT WITH ANY COURT AS WRITTEN EVIDENCE
OF THE KNOWING, VOLUNTARY, AND BARGAINED AGREEMENT OF LESSEE AND MANAGER
IRREVOCABLY TO WAIVE THEIR RIGHTS TO TRIAL BY JURY AS AN INDUCEMENT OF LESSOR TO
MAKE THE LEASE, AND THAT, TO THE EXTENT PERMITTED BY APPLICABLE LAW, ANY DISPUTE
OR CONTROVERSY WHATSOEVER (WHETHER OR NOT MODIFIED
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HEREIN) BETWEEN LESSEE AND/OR MANAGER WITH LESSOR SHALL INSTEAD BY TRIED IN A
COURT OF COMPETENT JURISDICTION BY A JUDGE SITTING WITHOUT A JURY.
[SIGNATURES ON FOLLOWING PAGE]
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IN WITNESS WHEREOF, Manager, Lessee, and Lessor have caused this
Agreement to be executed as of the day and year first above written.
LESSEE:
EXTENDED CARE OPERATORS OF
HARRISBURG, LLC
BY: /s/ Signature Illegible
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ITS:
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MANAGER:
BCC AT HARRISBURG, INC.
BY: /S/ Xxxxx X. Xxxxx
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XXXXX X. XXXXX, VICE-PRESIDENT
LESSOR:
CAPSTONE CAPITAL OF PENNSYLVANIA, INC.
BY: /s/ Xxxxx X. XxXxxxx
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XXXXX X. XXXXXXX, ASSISTANT VICE-PRESIDENT
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Schedule to Exhibit 10.62 filed pursuant to Instruction 2 to
Item 601(a) of Regulation S-K
Consent and Subordination 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
