Exhibit 10.58
FUNDING AGREEMENT
AMONG
BUCKS COUNTY ONOCOPLASTIC INSTITUTE, LLC ("BCOI"),
MPT OF BUCKS COUNTY, L.P. ("OWNER"),
AND
DSI FACILITY DEVELOPMENT, LLC ("DEVELOPER")
DATED AS OF SEPTEMBER 16, 2005.
TABLE OF CONTENTS
Page
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ARTICLE I DEFINED TERMS.................................................. 1
Section 1.01 Certain Defined Terms....................................... 1
Section 1.02 Singular and Plural Terms................................... 5
Section 1.03 Accounting Terms............................................ 5
Section 1.04 Amendments to Documents..................................... 6
ARTICLE II DISBURSEMENTS................................................. 6
Section 2.01 Disbursement Procedure...................................... 6
Section 2.02 Direct Funding.............................................. 8
Section 2.03 Representations and Warranties.............................. 9
Section 2.04 Additional Information...................................... 9
ARTICLE III CONDITIONS TO FUNDING........................................ 9
Section 3.01 Transaction Documents....................................... 9
Section 3.02 Execution of Documents...................................... 9
Section 3.03 Title Insurance............................................. 9
Section 3.04 Documents to be Furnished by BCOI Prior to Each Funding..... 10
Section 3.05 Continued Satisfaction of Duties,
Representations, Warranties and Covenants................... 10
Section 3.06 Disbursements for Materials Stored On-Site.................. 10
Section 3.07 Disbursements for Offsite Materials......................... 11
Section 3.08 Disbursements For Tenant Improvements....................... 11
Section 3.09 Assignment of Contracts..................................... 11
ARTICLE IV REPRESENTATIONS AND WARRANTIES................................ 12
Section 4.01 Existence and Ownership of BCOI and Developer............... 12
Section 4.02 Violations or Actions Pending............................... 12
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Section 4.03 Financial Statements........................................ 12
Section 4.04 Compliance with Laws and Regulations and
Transaction Documents....................................... 12
Section 4.05 Roads and Utilities.......................................... 13
Section 4.06 Condemnation................................................ 13
Section 4.07 Accuracy of Documents....................................... 13
Section 4.08 Environmental and Healthcare Matters........................ 13
Section 4.09 Agreements.................................................. 13
Section 4.10 Accurate and Complete Disclosure............................ 14
Section 4.11 Continuing Effectiveness.................................... 14
ARTICLE V COVENANTS OF BCOI/DEVELOPER.................................... 14
Section 5.01 Construction of Improvements............................... 14
Section 5.02 Use of Proceeds............................................. 15
Section 5.03 Liens and Encumbrances...................................... 15
Section 5.04 Deficiencies................................................ 15
Section 5.05 Reports and Notices......................................... 15
Section 5.06 Books and Records........................................... 16
Section 5.07 Access and Promotion........................................ 16
Section 5.08 Changes to the Site Plan and Plans and Specifications....... 16
Section 5.09 List of Contractors, Subcontractors, and Materialmen........ 16
Section 5.10 Lien Waiver................................................. 16
Section 5.11 Ownership of Personalty..................................... 17
Section 5.12 Appraisals.................................................. 17
Section 5.13 Other Acts.................................................. 17
Section 5.14 Construction Contracts...................................... 17
ARTICLE VI EVENTS OF DEFAULT............................................. 17
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Section 6.01 Assignment or Conveyance.................................... 17
Section 6.02 Voluntary Insolvency Proceedings............................ 18
Section 6.03 Involuntary Insolvency Proceedings.......................... 18
Section 6.04 Transfer.................................................... 18
Section 6.05 Foreclosures or Liens....................................... 18
Section 6.06 Casualty Loss............................................... 18
Section 6.07 Misrepresentation........................................... 18
Section 6.08 Failure to Complete Improvements............................ 19
Section 6.09 Failure to Perform Obligations.............................. 19
Section 6.10 Cross Defaults.............................................. 19
ARTICLE VII REMEDIES UPON DEFAULT........................................ 19
Section 7.01 Remedies of Owner........................................... 19
Section 7.02 Failure to Exercise Remedies................................ 20
ARTICLE VIII MISCELLANEOUS............................................... 21
Section 8.01 Conflict in Transaction Documents........................... 21
Section 8.02 Exclusiveness............................................... 21
Section 8.03 Notice...................................................... 21
Section 8.04 Modification and Waiver..................................... 21
Section 8.05 Materiality................................................. 21
Section 8.06 Heading..................................................... 21
Section 8.07 Severability................................................ 21
Section 8.08 Counterparts................................................ 21
Section 8.09 Assignability............................................... 21
Section 8.10 No Agency Relationship...................................... 22
Section 8.11 Waiver...................................................... 22
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Section 8.12 Costs and Expenses.......................................... 22
Section 8.13 Attorneys' Fees............................................. 23
Section 8.14 Warrant of Attorney......................................... 23
Section 8.15 Consequential Damages....................................... 23
Section 8.16 Indemnification............................................. 24
Section 8.17 Governing Law............................................... 24
Section 8.18 Jurisdiction and Venue...................................... 24
Section 8.19 Waiver of Jury Trial........................................ 24
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EXHIBITS
EXHIBIT A LEGAL DESCRIPTION OF PROPERTY
EXHIBIT B DEVELOPMENT BUDGET
EXHIBIT C THIRD PARTY AGREEMENTS
EXHIBIT D SITE PLAN
EXHIBIT E DRAW REQUESTS
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FUNDING AGREEMENT
THIS FUNDING AGREEMENT (this "Agreement") is dated as of September 16,
2005, by and among BUCKS COUNTY ONOCOPLASTIC INSTITUTE, LLC, a Delaware limited
liability company ("BCOI") whose address is 000 Xxxxx Xxxxxx, Xxxxx 0000,
Xxxxxxxxx, Xxxxxxxxx 00000, Attention: Xxxxxx X. Xxxxxxxxxx, MPT of BUCKS
COUNTY, L.P., a Delaware limited partnership ("Owner"), whose address is 0000
Xxxxx Xxxxxx Xxxxx, Xxxxx 000, Xxxxxxxxxx, Xxxxxxx 00000, Attention: Xxxxxx X.
Xxxxx, Xx., and DSI FACILITY DEVELOPMENT, LLC, a Delaware limited liability
company ("Developer"), whose address is 000 Xxxxx Xxxxxx, Xxxxx 0000, Xxxxxxxxx,
Xxxxxxxxx 00000, Attention: Xxxxxx X. Xxxxxxxxxx.
WITNESSETH
WHEREAS, BCOI has entered into a Lease Agreement dated as of the date
hereof (as defined below), between BCOI, as lessee, and Owner, as lessor;
WHEREAS, BCOI and Owner have entered into that certain Development
Agreement with Developer (each defined below), concerning the construction of
the Improvements, which Improvements shall be leased by Owner to BCOI pursuant
to the Lease Agreement;
WHEREAS, Owner has agreed to fund the construction of such Improvements on
the terms and conditions herein contained.
NOW, THEREFORE, in consideration of the promises and mutual agreements
contained herein, and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties do hereby agree as
follows:
ARTICLE I
DEFINED TERMS
SECTION 1.01 Certain Defined Terms. Certain capitalized terms used herein shall
have the respective meanings:
"Applicable Environmental Law" shall mean any applicable federal, state or local
law, rule or regulation pertaining to health or the environment, or petroleum
products, or radon radiation, or oil or hazardous substances, including, without
limitation, the Comprehensive Environmental Response, Compensation and Liability
Act of 1980, as amended ("CERCLA"), the Resource Conservation and Recovery Act
of 1976, as amended ("RCRA") and the Federal Emergency Planning and Community
Right-To-Know Act of 1986, as amended. The terms "hazardous substance" and
"release" shall have the meanings specified in CERCLA, and the terms "solid
waste," disposal," "dispose," and "disposed" shall have the meanings specified
in RCRA, except that if such acts are amended to broaden the meanings thereof,
the broader meaning shall apply herein prospectively from and after the date of
such amendments; notwithstanding the foregoing, provided, to the extent that the
laws of the state in which the Property is located establish a meaning for
"hazardous substance" or "release" which is broader than that specified in
CERCLA, as CERCLA may be amended from time to time, or a meaning for "solid
waste," "disposal," and "disposed" which is broader than specified in RCRA, as
RCRA may be amended
from time to time, such broader meanings under said state law shall apply in all
matters relating to the laws of such State.
"Applicable Healthcare Laws" shall mean all rules and regulations under the
False Claims Act (31 U.S.C. Section 3729 et seq.), the Federal Health Care
Programs Anti-Kickback statute (42 U.S.C. Section 1320a-7a(b)), the Ethics in
Patient Referrals Act of 1989, as amended (Xxxxx Law) (42 U.S.C. 1395nn), the
Civil Money Penalties Law (42 U.S.C. Section 1320a-7a), Health Care Fraud (18
U.S.C. 1347), Wire Fraud (18 U.S.C. 1343), Theft or Embezzlement (18 U.S.C.
669), False Statements (18 U.S.C. 1001), False Statements (19 U.S.C. 1035), and
Patient Inducement Statute, and applicable equivalent state statutes and any and
all rules or regulations promulgated by governmental entities with respect to
any of the foregoing.
"Assignment of Construction Documents" shall mean that certain Assignment of
Contracts and Documents of even date herewith from BCOI and Developer in favor
of Owner.
"Complete", "Completed" or "Completion" shall mean (i) that Owner has received a
certificate from the Project architect that the construction of the Project has
been substantially completed in accordance with the Plans and Specifications,
which certificate shall be in form and substance satisfactory to Owner and shall
include the written approval of the Construction Inspector noted thereon and
(ii) that Owner has received evidence that appropriate governmental authorities
have unconditionally approved and certified the completed Improvements in their
entirety for permanent occupancy as an acute-care hospital and incorporated
medical office building.
"Construction Contract" shall mean the lump sum price or other construction
contract between BCOI and General Contractor, which has been approved in writing
by Owner.
"Construction Inspector" shall mean Xxxxx Xxxxx, or such other architect,
engineer or other inspector selected by Owner, in Owner's discretion, who shall
assist Owner in connection with the construction of the Improvements, including
but not limited to, reviewing Plans and Specifications, making inspections of
the progress of construction of the Improvements for purposes of funding, and
advising Owner with respect to other matters relating to the Property and
Improvements as Owner may request in its reasonable discretion.
"Credit Enhancements" shall have the meaning set forth in the Lease Agreement.
"Default" shall mean the occurrence or existence of any event which, but for the
giving of notice or expiration of time or both, would constitute an Event of
Default.
"Developer" shall mean DSI Facility Development, LLC, a Delaware limited
liability company.
"Development Agreement" shall mean the Development Agreement between Owner, BCOI
and Developer dated of even date herewith, with respect to the construction of
the Improvements.
"Development Budget" shall mean the detailed line item cost budget attached
hereto as EXHIBIT B (which Owner hereby approves) setting forth total estimated
costs with respect to the Property and the construction of the Improvements, as
revised from time to time with Owner's prior written approval.
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"Draw Requests" shall mean the detailed written draw requests designated "Draw
Request #1" and "Draw Request #2" attached hereto as EXHIBIT E setting forth the
requests previously made by Developer and the subsequent advances made by Owner
to Developer pursuant thereto.
"Event of Default" shall mean an "Event of Default" as defined in Article VI of
this Agreement. Such term shall mean that any required notice has been given and
any applicable cure period has expired, except as otherwise expressly provided
in the last paragraph of such Article VI.
"Final Funding" shall have the meaning set forth in Section 2.01 (i) hereof.
"Funding" shall mean a disbursement of funds by Owner for purposes of funding
the construction and development of the Improvements, and shall include the
Initial Funding.
"GAAP" shall mean generally accepted accounting principles, consistently
applied.
"General Contractor" shall mean such general contractor(s) selected by BCOI or
the Developer and submitted to and approved by Owner.
"Guarantors" shall mean one or more, Xxxx Xxxxxx, M.D., Xxx Xxxxxxxx, M.D., Xxx
Xxxxxxxxx, Xxxxx Xxxxxxxxx, Xxxx Xxxxx, M.D., Xxxxxxxx Xxxxx, Merdhad Soroush,
M.D., Xxxxxxx X. Xxxxxxx, Xxxxxxx X. Xxxxxxx, Xxx Xxxxx, Xxxxxxx Xxxxxx, Xxxx
Xxxxxxxxxx, G. Xxxxxxx Xxxxxxx, M.D., M. Xxxxxxx Xxxxxxxx, Xxxxxxx Xxxxxxxxxx,
Xxxxxx X. Xxxxxxxxxx, M.D., Xxxxx Xxxxxxxx and Centre Bregal Partners, L.P..
"Guaranty" shall mean that certain Lease Guaranty executed by the Guarantors of
even date herewith, as the same may be amended, modified and/or restated from
time to time.
"Improvements" shall mean (i) the medical office buildings and related
improvements (the "MOB Improvements") and (ii) the hospital facility and
connector structure (the "Hospital Improvements") as shown on the Site Plan,
including all buildings, improvements, structures and fixtures, landscaping,
parking lots and structures, roads, drainage and all above ground and under
ground utility structures equipment systems and other so-called "infrastructure"
improvements for use in connection therewith.
"Indemnity Agreement" shall mean the Environmental Indemnity Agreement of even
date herewith from BCOI in favor of Owner.
"Initial Funding" shall mean the initial funding hereunder as set forth in the
closing statement signed by BCOI and submitted to and approved by Owner on or
about the date of this Agreement.
"Key Tenant" shall mean the tenant under a Key Tenant Lease.
"Key Tenant Lease" shall mean any lease or other occupancy agreement which
provides to the tenant thereunder a right to approve any construction of the
Improvements.
"Knowledge" shall mean, with respect to any Person, such Person's actual or
deemed knowledge of a particular fact or matter if (i) any of such Person's
officers or directors (or persons
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possessing and/or exercising similar authority with respect to such Person) (a
Person's "Knowledge Group") has actual knowledge of such fact or matter, or (ii)
any member of such Person's Knowledge Group would reasonably be expected to have
actual knowledge of such fact or matter based on his or her office or position
within such Person.
"Lease Agreement" shall mean that certain Lease Agreement dated the date hereof
between BCOI and Owner with respect to the Property.
"Leased Property" shall have the meaning set forth in the Lease Agreement.
"Overdue Rate" shall have the meaning set forth in the Lease Agreement.
"Person" shall mean an individual, firm, corporation, general or limited
partnership, limited liability company, an unincorporated association, joint
venture, governmental entity or another entity or group.
"Plans and Specifications" shall mean the plans and specifications for the
Improvements prepared by DSI Facility Development, LLC, and dated April 11,
2005, which Owner hereby approves, as the same may be revised from time to time
in accordance with the terms of the Transaction Documents or otherwise with the
approval of Owner.
"Project Completion Date" shall mean (a) July 31, 2006, or (b) as to any
Improvements to be occupied by a Tenant Lease, the date required by such Tenant
Lease, whichever first occurs, or (c) such other date the Owner may approve in
its sole discretion at the request of BCOI.
"Project" shall mean the Property and Improvements.
"Property" shall mean BCOI's leasehold interests in the approximately fifteen
(15) acres of real property located in Bensalem Township, Bucks County,
Pennsylvania more particularly described on the attached EXHIBIT A, as more
fully described in the Lease Agreement.
"Purchase Agreement" shall mean that certain Purchase and Sale Agreement dated
March 3, 2005 among BCOI, MPT Operating Partnership, L.P., DSI Facility
Development, LLC, Xxxxxx X. Xxxxxxxxxx, M.D., M. Xxxxxxx Xxxxxxxx and G. Xxxxxxx
Xxxxxxx, M.D., as amended, supplemented and otherwise modified from time to time
in accordance with the terms thereof.
"Retainage" shall mean the greater of (a) the retainage required by the
Construction Contract together with change orders with respect thereto which are
approved in accordance with Section 5.08, or (b) ten percent (10%) of the costs
of completed construction under such contract, to the extent such completed
construction and costs thereof have then been approved by Owner's Construction
Inspector.
"Single Purpose Entity" shall mean an entity which (i) exists solely for the
purpose of owning, and/or leasing all or any portion of the Project and
conducting the operation of a business therefrom in accordance with the terms of
the applicable Lease (the "Business"), (ii) conducts business only in its own
name or under fictitious or d/b/a names previously disclosed to Owner, (iii)
does not engage in any business other than the ownership and/or leasing of all
or any portion of the Property and the operation of the Business, except for the
operation of that certain stand
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alone imaging center previously disclosed to Owner, (iv) does not hold, directly
or indirectly, any ownership interest (legal or equitable) in any entity or any
real or personal property other than the interest in the Project and the other
assets incident to the operation of the Business, (v) does not have any debt
other than as permitted by the Lease Agreement and does not guarantee or
otherwise obligate itself with respect to the debts of any other person or
entity, other than as approved by Owner, (vi) has its own separate books,
records, accounts, financial statements and tax returns (with no commingling of
funds or assets), (vii) holds itself out as being a company separate and apart
from any other entity, and (viii) maintains all corporate formalities
independent of any other entity.
"Site Plan" shall mean BCOI's site plan dated April 8, 2005 prepared by Xxxxxx
Xxxxxxx & Xxxxxx and attached hereto as EXHIBIT D.
"Tenants" shall mean the lessees or tenants under the Tenant Leases, if any.
"Tenant Leases" refers to all leases, subleases and other rental agreements
(written or verbal, now or hereafter in effect), if any, that grant a possessory
interest in and to any space in or any part of the Leased Property, or that
otherwise have rights with regard to the Leased Property, and all Credit
Enhancements, if any, held in connection therewith.
"Tenant Improvements" refers to the interior partitions, finishes and other
tenant improvement work in and for each suite of space in the Leased Property
leased to a Tenant as required or permitted under the Tenant Leases.
"Third Party Agreements" shall mean all agreements with respect to the
development and construction of the Improvements that provide for consideration
to be paid of Five Thousand Dollars ($5,000.00) or more, including the agreement
with the General Contractor. All currently existing Third Party Agreements are
listed on EXHIBIT C hereto.
"Title Company" shall mean First American Title Insurance Company.
"Title Policy" shall have the meaning set forth in Section 3.03.
"Total Funding Amount" shall mean $38,000,000.00
"Transaction Document or "Transaction Documents" shall mean this Agreement, the
Lease Agreement, the Guaranty, the Third Party Agreements, the Development
Agreement, the Assignment of Construction Documents and the Purchase Agreement
and any and all other instruments or documents heretofore or hereafter executed
and delivered in connection with any of the foregoing or the transactions
contemplated thereby, together with any and all extensions, amendments,
modifications and/or renewals of any of the foregoing.
SECTION 1.02 Singular and Plural Terms. Singular terms shall include the plural
forms and vice versa, as applicable, of the terms defined.
SECTION 1.03 Accounting Terms. All accounting terms used in this Agreement shall
be construed in accordance with GAAP, except as otherwise defined.
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SECTION 1.04 Amendments to Documents. All references to other documents or
instruments shall be deemed to refer to such documents or instruments as they
may hereafter be extended, renewed, modified, or amended and all replacements
and substitutions therefor.
ARTICLE II
DISBURSEMENTS
SECTION 2.01 Disbursement Procedure. Subject to the terms and conditions hereof,
the terms and conditions set forth in the Development Agreement, and based upon
the representations set forth herein, Owner agrees to disburse the amounts set
forth herein for costs of construction of the Improvements and related fees, not
to exceed the Total Funding Amount (less the sum of Five Million Three Hundred
Ninety-Five Thousand Four Hundred Ninety-Seven and 21/100 Dollars
($5,395,497.21)), which is the total cost of the land on which the Improvements
are to be constructed and which is not being funded pursuant hereto) provided,
however, Owner will not disburse any funds for any cost overruns except as
expressly required herein. Subject to compliance by BCOI and the Developer, as
applicable, with all of the terms, conditions and provisions of this Agreement
and the Development Agreement, the Initial Funding will be disbursed at Closing
(as herein defined). The parties acknowledge that advances against the Total
Funding Amount have previously been made as set forth on the Draw Requests. The
remainder of the Total Funding Amount shall be disbursed in Fundings at such
time and in such amounts as Owner shall determine in accordance with the
following procedures:
(a) Not less than ten (10) business days before the date on which BCOI or
Developer desires a Funding, BCOI or Developer shall submit to Owner a
requisition in form reasonably satisfactory to Owner which shall include (i) the
Development Budget, (ii) for amounts in the Development Budget designated for
construction of the Improvements pursuant to the Construction Contract with the
General Contractor, an AIA G702/703 form containing the itemized schedule of
values for the construction work and all costs incurred to date for construction
pursuant to each category of such schedule of values, (iii) a separate
itemization of costs incurred for equipment, construction and nonconstruction
expenses in connection with the Property and Improvements (other than those
incurred pursuant to a contract with the General Contractor (itemized under the
line items of the Development Budget, with copies of invoices for all such
amounts)) and (iv) the percentage of completion of each line item on the
Development Budget (if applicable) and schedule of values. The accuracy of the
costs and percentage of completion shall be certified to Owner by BCOI and
Developer, by the Construction Inspector, by BCOI's architect and, in the case
of construction of the Improvements by the General Contractor, also by the
General Contractor, in each case as true in all material respects. All
disbursements shall require approval of Owner's Construction Inspector. BCOI
appoints Xxxxxx X. Xxxxxxxxxx and Xxxxxx Xxxxxxx as its agents to make
disbursement requests. Developer appoints Xxxxx Xxxxxxxx and Xxxxxx Xxxxxxx as
its agents to make disbursement requests. Any of the foregoing agents, and any
one of the agents appointed by BCOI or Developer pursuant to the next sentence,
is hereby authorized to request a Funding. BCOI and Developer may hereafter by
written notice to Owner appoint one or more other agents or change agents to
make disbursement requests, provided any such notice is not effective until
actually received by Owner.
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(b) The completed construction work with respect to the Improvements to the
date of any request for a Funding must be reviewed and approved by the
Construction Inspector as a condition to a Funding. BCOI or Developer will
contact the Construction Inspector and coordinate delivery of BCOI's or
Developer's request for a Funding with an inspection by the Construction
Inspector in order to allow the Construction Inspector to review the completed
construction work for which costs are included in BCOI's or Developer's request
for a Funding. Such Construction Inspector will review and certify to Owner his
opinion of the percentage of completion, compliance with Plans and
Specifications and the maximum allowable Funding applicable thereto, which shall
be determined in accordance with this Agreement.
(c) A maximum Funding (except in the case of the Final Funding, as herein
defined) will equal nonconstruction expenses actually incurred within the
amounts set forth in the Development Budget (as reallocated from time to time in
accordance with subparagraph (d), below), plus the lesser of (i) the actual cost
of the completed construction of the Improvements, deposits or purchases for
future use, or (ii) Owner-approved scheduled value of each completed portion of
the Improvements (as set forth in the Development Budget), but no Funding for
duplication of work for which funds were previously disbursed, work that does
not conform in all material respects to the Plans and Specifications, or work
that is unsatisfactory in the reasonable opinion of the Construction Inspector
or unavailable for review by the Construction Inspector, less: (1) the Retainage
and (2) the amounts previously disbursed by Owner.
(d) Any Funding for costs of construction on each line item shown in the
Development Budget shall be made only up to the amount set forth in the
Development Budget shall be made for such line item, except that BCOI or
Developer will be entitled to reallocate individual costs of no more than Six
Hundred Thousand Dollars ($600,000.00) within each of the cost codes set forth
in the Development Budget without Owner's prior written consent. A reallocation
among line items may be made only upon the prior written consent of Owner.
Notwithstanding the foregoing, no Funding from hard cost categories to soft cost
categories or from interest to other categories shall be permitted except in
Owner's sole discretion. No Funding will be made for materials stored for future
use except in accordance with Sections 3.06.
(e) Fundings may be made for deposits for materials and/or services and for
materials stored for future use in accordance with Sections 3.06 hereof.
(f) Notwithstanding the foregoing, Owner shall not be required to make a
Funding more than once each month, and Owner reserves the right to limit the
total amount disbursed hereunder at any time to an amount which, when deducted
from the Total Funding Amount, leaves a balance to be disbursed equal to or
greater than the cost of completion of the Improvements and payment of remaining
nonconstruction expenses (including funding of reserve funds or deposits if
required by this Agreement) plus the Retainage under any contract for which the
conditions herein for release have not been satisfied, all as reasonably
determined by Owner from time to time. Prior to the Final Funding, Owner shall
be entitled to retain at all times as undisbursed funds in an amount sufficient
to pay all construction and nonconstruction costs relating to construction of
the Improvements, as reasonably estimated by Owner, including, but not limited
to, amounts to become due pursuant to construction contracts and equipment
purchase contracts, amounts to complete the Improvements but not yet included in
any such contract, maintenance bond and completion bond payments, estimated
interest costs in excess of
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anticipated cash available for debt service prior to the anticipated date the
Improvements will be completed and will achieve earnings sufficient to cover
operating expenses and debt service, estimated post-closing fees and expenses of
Owner and its counsel, estimated permit and license fees, estimated
architectural and engineering fees of BCOI and the Construction Inspector, and
estimated recording and title insurance costs, all to the extent reasonably
anticipated to be incurred after closing.
(g) No Fundings shall be made after the Project Completion Date, except in
Owner's discretion.
(h) The line items on the Development Budget designated as "Developer Fee"
($515,000) and "Construction Management Fee" ($687,500; advances of which have
been previously made by Owner to Developer in the amount set forth on the line
item designated as "DSI Construction Management Fee" and the column designated
as "Payment This Request" on Draw Request #2), will be disbursed as follows: (i)
Eighty percent (80%) of such fees will be disbursed in ten (10) equal monthly
installments beginning on September 15, 2005 and (ii) the remaining twenty
percent (20%) will be disbursed at the time of the Final Funding, unless sooner
paid pursuant to Section 3.3(h) of the Development Agreement; In addition,
unless sooner paid pursuant to Section 3.3 (h) of the Development Agreement, the
Final Funding shall include the Developer Bonus, as defined in Exhibit F to the
Development Agreement.
(i) The Retainage and any other amounts not previously funded shall be
funded (the "Final Funding") promptly upon the occurrence of all of the
following (i) the satisfactory completion (as determined by BCOI and Owner) of
all construction work under the Construction Contract, (ii) the Owner has
received a certificate from the Project architect that the construction of the
Project has been substantially completed in accordance with the Plans and
Specifications, which certificate shall be in form and substance satisfactory to
Owner and shall include the written approval of the Construction Inspector noted
thereon, (ii) Owner has received evidence that appropriate governmental
authorities have unconditionally approved and certified the Completed
Improvements in their entirety for permanent occupancy as an acute-care hospital
and incorporated medical office building; (iii) the Owner has received evidence
satisfactory to Owner that the Completed Improvements are free of all mechanic's
and materialmen's liens, (iv) BCOI has obtained and delivered to Owner an "as
built" ALTA survey prepared by an engineer or surveyor licensed in the State of
Pennsylvania in form and content acceptable to Owner, certified to ALTA
standards, and certifying that the Improvements, among other things, do not
encroach upon any contiguous properties, (v) all punch list items have been
completed to Owner's Construction Inspector's satisfaction, (vi) BCOI (as tenant
under the Lease Agreement) shall have executed an acknowledgement of acceptance
of the Property in form and substance acceptable to Owner, (vii) there are no
defaults or events of default (and no event has occurred which with the giving
of notice or passage of time or both would constitute a default) under this
Agreement and (viii) BCOI has been issued a license to operate as a healthcare
facility in the State of Pennsylvania by the proper governmental authorities.
SECTION 2.02 Direct Funding. The parties acknowledge and agree that regardless
of whether BCOI has submitted a requisition therefor, Owner intends to make
Fundings directly to the General Contractor and other payees under the Third
Party Agreements. All such Fundings shall nevertheless be deemed Fundings to
BCOI hereunder and shall be subject to the terms hereof to
8
the same extent as if they were made directly to BCOI. Notwithstanding the
foregoing, if BCOI or Developer notify Owner of a payment dispute with any such
payee, Owner shall not make a Funding to such payee until notified by BCOI or
Developer that such dispute has been resolved, unless Owner determines that
withholding such funding will be detrimental to the project.
SECTION 2.03 Representations and Warranties. Each submission by BCOI or
Developer to Owner of a requisition for a Funding shall constitute BCOI's or
Developer's representation and warranty to Owner that: (a) all completed
construction is in accordance with the Plans and Specifications in all material
respects and (b) all construction and nonconstruction costs for the payment of
which Owner has previously disbursed funds have in fact been paid or
arrangements for timely payment thereof have been made.
SECTION 2.04 Additional Information. If Owner or the Title Company shall so
require, BCOI or Developer, as applicable, will submit with its requisitions for
any Funding estoppel certificates in form satisfactory to Owner and the Title
Company, showing amounts paid and amounts due to all persons or organizations
furnishing labor or materials in connection with the completion of the
Improvements.
ARTICLE III
CONDITIONS TO FUNDING
Owner's obligation to make any Funding hereunder shall be effective only
upon fulfillment of, or written waiver by Owner of, the following conditions:
SECTION 3.01 Transaction Documents. Receipt and approval by Owner of all items
required to be provided to Owner under the terms of the Transaction Documents.
For purposes of this Section 3.0l, such items shall be in final form unless
permitted by the Transaction Documents to be in draft or preliminary form.
SECTION 3.02 Execution of Documents. Execution, delivery and, when necessary,
recording or filing, of any of the Transaction Documents which Owner desires to
file or record, and the payment by BCOI and/or Developer of all fees and taxes
with respect to such filing or recording.
SECTION 3.03 Title Insurance. BCOI or Developer shall arrange to have the Title
Company issue and deliver to Owner an endorsement (the "Endorsement") extending
the effective date of the Owner's title insurance policy issued to Owner in
connection with its acquisition of the Property (the "Title Policy") through the
date of such Funding and insuring Owner for said Funding (including a final
Funding) under the Title Policy without additional title exceptions, except
those that may be approved by Owner in its discretion. Each Endorsement shall
confirm that (i) there has been no change in the status of the title to the
Property, (ii) there has been no creation of any new encumbrance or lien on the
Property or the Improvements, and (iii) there has been no occurrence or any
event that could in Owner's opinion impair the priority of the lien of the Lease
Agreement, all as of the time of each such Funding (including a final Funding).
In addition thereto, BCOI or Developer shall deliver to Owner and the Title
Company the documentation required under Section 2.05 above.
9
SECTION 3.04 Documents to be Furnished by BCOI Prior to Each Funding. As a
condition precedent to each Funding (provided, however that the Initial Funding
shall not be required to satisfy the condition precedents set forth in Sections
3.04(b) through (f) below), BCOI shall furnish or cause to be furnished to Owner
the following documents covering each disbursement, in form and substance
satisfactory to Owner:
(a) A requisition meeting all the requirements set forth in Section
2.01(a) of this Agreement, and approved by Owner and/or Owner's
Construction Inspector;
(b) A completed standard AIA Form G702 and Form G703 signed by the
General Contractor and the architect, together with sworn statements and
unconditional waivers of liens signed by the applicable contractor,
subcontractor or materialman engaged or to be engaged by BCOI or Developer
or with whom BCOI or Developer shall have any dealings with respect to
construction of the Improvements, covering all work, to be paid with the
proceeds of any prior Fundings, together with such invoices, contracts or
other supporting data as Owner or the Title Company may require to evidence
that all costs for which disbursement is sought have been incurred;
(c) An endorsement to Owner's title insurance policy as required by
Section 3.03 hereof;
(d) Copies of any executed change orders not previously furnished to
Owner, and any amendments or modifications to any Third Party Agreements;
(e) Copies of all construction contracts (including subcontracts)
executed since the last Funding, together with any bonds obtained or
required to be obtained with respect thereto;
(f) Satisfactory evidence that all government approvals have been
obtained for development of the Project; and
(g) Such other instruments, documents and information as Owner or the
Title Company may reasonably request.
SECTION 3.05 Continued Satisfaction of Duties, Representations, Warranties and
Covenants. As of each Funding date, in Owner's sole discretion, (a) BCOI and
Developer continue to satisfy all conditions precedent to Funding set forth in
Articles II and III hereof, (b) BCOI, Developer and Guarantors shall have
performed and complied with all terms and conditions set forth in this Agreement
and the Transaction Documents, (c) all representations and warranties in this
Agreement and the Transaction Documents remain true, correct and complete in all
material respects, and (d) there exists no Default or Event of Default
hereunder.
SECTION 3.06 Disbursements for Materials Stored for Future Use. Any requests for
disbursements which in whole or in part relate to materials which are not
incorporated into the Improvements as of the date of the request for
disbursement but are to be temporarily stored at the Project or in an off-site
storage facility, including disbursements for deposits for such materials, must
be accompanied by evidence satisfactory to Owner that (i) such materials are
included within the coverages of insurance policies carried by BCOI, (ii) the
ownership of such
10
materials is vested (or, in the case of disbursements for deposits, will be
vested) in BCOI free of any liens and claims of third parties, (iii) such
materials are properly insured and protected against theft or damage, (iv) the
Owner's Construction Inspector has viewed and inspected the stored materials
(except in the case of disbursements for deposits), and (v) in the opinion of
the Owner's Construction Inspector, the materials are physically secured and can
be incorporated into the Project within ninety (90) days from the date of the
requisition (or, in the case of disbursements for deposits, in the opinion of
the Construction Inspector the materials to which the deposit relates can be
incorporated into the Project within ninety (90) days from the date the
materials will be delivered). Owner may require separate Uniform Commercial Code
financing statements to cover any such stored materials.
SECTION 3.07 Intentionally omitted.
SECTION 3.08 Disbursements For Tenant Improvements. Owner shall not be obligated
to make any disbursements for Tenant Improvements, unless the Owner receives a
certified statement from BCOI and Developer certifying that the costs of the
Tenant Improvements and all Tenant Improvement allowances are within the
Development Budget. In addition, the first request for disbursement for Tenant
Improvements in connection with a specific leased space in the Project shall be
accompanied by the following, all of which shall be subject to the approval of
Owner: (i) copies of all contracts, if not previously delivered to Owner, for
the performance of such Tenant Improvements, (ii) a cost breakdown for each
trade performing Tenant Improvements in such leased space, and an estimated
commencement and completion date, (iii) an estimate of all direct costs of the
Tenant Improvements to be performed in such leased space which has not been
contracted for or made subject to a work order or order to proceed, (iv) plans
and specifications for the leased space (v) a certified statement from BCOI and
Developer that the costs of the Tenant Improvements and all Tenant Improvement
allowances are within the Development Budget, and (vi) a fully executed lease
approved by Owner covering such leased space.
SECTION 3.09 Assignment of Contracts. BCOI and/or Developer, as applicable, have
assigned, or shall assign, all Third Party Agreements to Owner and, in addition,
have provided, or shall provide, the following to Owner: (i) a subordination,
certificate and consent to assignment from the Project architect and from the
General Contractor, each in form and substance acceptable BCOI and Owner; and
(ii) a letter, in form and substance acceptable to BCOI and Owner, from each of
the parties to any other Third Party Agreements evidencing their agreement to
subordinate such Third Party Agreements and their consent to the assignment
thereof or; (b) where the Third Party Agreement consists only of a purchase
order, a copy of the purchase order executed by each such party, which must be
in form and substance acceptable to, and preapproved by, BCOI and Owner.
In the event Owner, at its option, elects to make one or more Fundings
prior to receipt and approval of all items required by this Article III, such
election shall not obligate Owner to make any subsequent Funding unless the
terms, conditions and provisions set forth herein are met.
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ARTICLE IV
REPRESENTATIONS AND WARRANTIES
BCOI and Developer, jointly and severally represent and warrant to Owner,
knowing that Owner will rely on such representations and warranties as incentive
to enter into the transactions contemplated hereby:
SECTION 4.01 Existence and Ownership of BCOI and Developer. BCOI and Developer
are duly organized and validly existing Delaware limited liability companies
having full power and authority to consummate the transactions contemplated by
this Agreement. Ownership of BCOI and Developer as of the date hereof are as set
forth on SCHEDULE 4.01 attached hereto and made a part hereof by reference and
incorporation. BCOI and Developer each represent and warrant that they are, and
at all times since their formation have been, Single Purpose Entities.
SECTION 4.02 Violations or Actions Pending. There are no actions, suits, or
proceedings pending or, to the best of the knowledge of BCOI and Developer,
threatened, which would reasonably be expected to materially adversely affect
the financial condition of BCOI or Developer or which would reasonably be
expected to impair the value of any Leased Property taken or to be taken by
Owner in connection with this Agreement or any other Transaction Documents. BCOI
and Developer are not in violation of any agreement the violation of which might
reasonably be expected to have a materially adverse effect on BCOI's or
Developer's business or assets, and are not in violation of any order, judgment,
or decree of any court, or any statute or governmental regulation to which BCOI
or Developer is subject, the violation of which would reasonably be expected to
materially adversely affect the financial condition of BCOI or Developer.
Neither the execution nor the performance of this Agreement or any of the
Transaction Documents by BCOI or Developer will result in any material breach of
any security instrument, lease, credit or loan agreement or any other instrument
or agreement which may bind or affect such Person.
SECTION 4.03 Financial Statements. All financial statements of BCOI and
Developer, heretofore given and hereafter to be given to Owner are and will be
true, correct and complete in all material respects as of their respective dates
and prepared in accordance with GAAP, and fairly represent the financial
conditions of the business or persons to which they pertain, and no materially
adverse change has occurred in the financial conditions reflected therein since
the respective date thereof.
SECTION 4.04 Compliance with Laws and Regulations and Transaction Documents. All
necessary permits and approvals have been received, are final and are
unappealable and all necessary action has been taken to permit construction of
the Improvements according to the Plans and Specifications, each as may be
necessary pursuant to applicable covenants and restrictions of record and all
applicable laws, ordinances, and regulations, including, without limitation,
subdivision, zoning, building codes, set back requirements and environmental
laws. When completed according to the Plans and Specifications, the Improvements
will comply with all covenants and restrictions of record and all applicable
laws, ordinances and regulations, including, without limitation, the Applicable
Healthcare Laws, Americans with Disabilities Act and regulations thereunder and
laws, ordinances and regulations relating to subdivision, zoning, building
codes, set back requirements and environmental laws. BCOI and Developer are in
compliance in all material respects with the Transaction Documents.
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SECTION 4.05 Roads and Utilities. All utility, water and sanitary sewage
services necessary for the construction and use of the Improvements are
available to the Property and BCOI and Developer have received permission to
make such use thereof as is necessary for construction of the Improvements and
as is necessary for the use thereof after completion of the Improvements. The
Property abuts upon or has access via one or more valid and subsisting easements
or rights or way, to a physically open and publicly dedicated street. There are
no off Property improvements necessary for the full use of the Improvements upon
completion thereof.
SECTION 4.06 Condemnation. There are no proceedings pending, or, to the best of
BCOI's and Developer's knowledge, threatened, to acquire any power of
condemnation or eminent domain, with respect to the Property, or any interest
therein, or to enjoin or similarly prevent the construction or use of the
Improvements.
SECTION 4.07 Accuracy of Documents. All documents furnished to Owner by or on
behalf of BCOI and Developer as part of or in support of this Agreement are
true, correct, complete in all material respects and accurately represent the
matters to which they pertain in all material respects.
SECTION 4.08 Environmental and Healthcare Matters. Neither BCOI, Developer nor,
to the best of BCOI's and Developer's knowledge, the Property is in violation of
or subject to any existing, pending or, to the best of BCOI's and Developer's
knowledge, threatened investigation or inquiry by any governmental authority or
any remedial obligations under any Applicable Environmental Law or Applicable
Healthcare Law, and there are no facts, conditions or circumstances known to it
which are reasonably likely to result in any such investigation or inquiry if
such facts, conditions and circumstances, if any, were fully disclosed to the
applicable governmental authority. To the best of BCOI's and Developer's
knowledge, except as disclosed in the Phase I environmental site assessment
report dated April 9, 2005, prepared by EMG Corporation, BCOI and Developer (i)
are not aware of any facts, conditions or circumstances relating to the Project
which are or could reasonably be expected to be in violation of any Applicable
Environmental Law or any Healthcare Law, (ii) are not aware of any Applicable
Environmental Law or any Healthcare Law investigation or inquiry relating to the
Project, (iii) have not obtained and are not required to obtain any permits,
licenses, or similar authorizations to construct, occupy, operate or use any
buildings, improvements, fixtures or equipment required in connection with the
Property or Improvements constructed or to be constructed thereon by reason of
any Applicable Environmental Law or any Healthcare Law that has not already been
obtained, and (iv) are not aware of any oil, toxic or hazardous substances or
solid wastes that have been disposed of or released on the Property
(collectively the "Environmental and Healthcare Matters"). BCOI and Developer
agree (i) to promptly notify Owner if BCOI or Developer becomes aware of any
Environmental and Healthcare Matters which affect or could reasonably be
expected to affect the Project, and (ii) that they will not, in their use of the
Property and the Improvements, dispose of or release oil, toxic or hazardous
substances or solid wastes, on the Property or in the Improvements, except as
would not constitute a violation of any Applicable Environmental Laws and
Healthcare Laws.
SECTION 4.09 Agreements. Each of the Transaction Documents is in full force and
effect, has not been amended or modified, and no default or condition which with
the giving of notice or passage of time would constitute such a default by BCOI
or Developer, exists thereunder. Each
13
Third Party Agreement is assignable to Owner pursuant to the terms thereof. A
true, correct and complete list of all material Third Party Agreements currently
existing with respect to the Project is set forth in EXHIBIT C hereto.
SECTION 4.10 Accurate and Complete Disclosure. No representation or warranty
made by BCOI or Developer under this Agreement and made by any employee,
affiliate or agent of BCOI and Developer to Owner pursuant to or in connection
with this Agreement is false or misleading in any material respect (including by
omission of material information necessary to make such representation, warranty
or statement not misleading in any material respect). BCOI or Developer has
disclosed to Owner in writing every fact of which BCOI or Developer, as
applicable, has knowledge which materially and adversely affects, or would
materially and adversely affect the business, operations or financial condition
of BCOI and Developer or the ability of BCOI and Developer to perform their
obligations under this Agreement.
SECTION 4.11 Continuing Effectiveness. All representations and warranties
contained herein shall be deemed made each time BCOI or Developer requests any
Funding pursuant to this Agreement unless BCOI or Developer specifically
notifies Owner of any change therein. It shall be a condition precedent to the
Initial Funding and each subsequent disbursement that each of said
representations and warranties is true and correct in all material respects as
of the date of such requested disbursement. In addition, at Owner's request,
BCOI and/or Developer shall reaffirm such representations and warranties in
writing prior to each disbursement hereunder.
ARTICLE V
COVENANTS OF BCOI/DEVELOPER
BCOI and Developer covenant and agree, from the date of this Agreement and
as long as BCOI or Developer may obtain any Fundings under this Agreement, to:
SECTION 5.01 Construction of Improvements. (i) Cause the commencement of
construction and the completion of the construction of the Improvements in
accordance with the terms of the Development Agreement; (ii) furnish Owner a
foundation survey promptly upon completion of the foundations of the
Improvements; (iii) cause the Improvements to be constructed in compliance with
and thereafter remain in compliance with all applicable covenants and
restrictions of record and all applicable laws, ordinances and regulations,
including, without limitation, Applicable Environmental Law, the Applicable
Healthcare Laws, Americans with Disabilities Act and regulations thereunder, and
laws, ordinances and regulations relating to subdivision, zoning, building
codes, set back requirements and environmental matters; (iv) cause the
Improvements to be constructed so as not to encroach upon or overhang any
Property line, setback line, easement or right-of-way (except as permitted
pursuant to a properly executed and recorded easement or other applicable
agreement, in form and substance reasonably acceptable to Owner); (v) cause such
construction to proceed continuously (subject to temporary cessation to the
extent not in violation of the terms of this Agreement); (vi) complete
construction of the Improvements by the Project Completion Date, time being of
the essence; (vii) furnish to Owner within thirty (30) days of Owner's request
and upon substantial completion of the Project an as-built survey, in form
satisfactory to Owner showing the location of the Improvements without violation
of set back lines, zoning or subdivision requirements, easements, covenants or
restrictions and showing no encroachments or other conditions which could
reasonably be
14
expected to materially adversely affect the value and use of the Property and
Improvements; and (viii) upon substantial completion of the Project furnish
Owner a final date-down endorsement to the Title Policy bringing the effective
date current, adding the ALTA 3.1 zoning endorsement and comprehensive
endorsement (if not yet a part of the policy)and such other additional
endorsements reasonably required by Owner, to the extent available.
SECTION 5.02 Use of Proceeds. Use each Funding solely and exclusively for the
purposes set forth in, and in the amounts set forth in, the Development Budget
(as may amended or modified in accordance with this Agreement), in this
Agreement or in the Development Agreement, and pay such other fees, closing
costs, and other nonconstruction expenses relating to the construction of the
Improvements, or the discharge of BCOI's or Developer's obligations under this
Agreement as Owner has approved or may from time to time approve.
SECTION 5.03 Liens and Encumbrances. Keep its interest in the Property and
Improvements and all other assets of BCOI free from all liens and encumbrances
except those contemplated by the Transaction Documents; pay prior to delinquency
and prior to any interest, fees or penalties being incurred for not promptly
paying, all persons or entities supplying work or materials for the construction
of the Improvements, except, in each case, for good faith contests of which
Owner has been notified in writing to the extent such contest is material to the
completion of the Project; and promptly discharge, bond off, provide affirmative
title insurance coverage insuring Owner against any loss or damage with respect
to, or make other arrangements acceptable to Owner with respect to, any
mechanic's, materialman's or other lien filed against the Property, the
Improvements, BCOI or the Sole Member.
SECTION 5.04 Deficiencies. Deposit with Owner within ten (10) days following
Owner's demand therefor (which demand may be made at Owner's option) the amount
of money equal to the difference between the undisbursed Total Funding Amount
(less the sum of Five Million Three Hundred Ninety-Five Thousand Four Hundred
Ninety-Seven and 21/100 Dollars ($5,395,497.21)), as of such date and the amount
which Owner shall reasonably determine is necessary to fully complete the
construction of the Improvements free of all liens, including direct and
indirect costs and work performed but for which payment has not been made, and
Owner shall be under no obligation to make any further Fundings until any amount
so demanded is so deposited with Owner.
SECTION 5.05 Reports and Notices. Furnish promptly to Owner such information as
Owner may reasonably require concerning costs, progress of construction,
marketing, and such other factors as Owner may require; notify Owner promptly of
any litigation instituted or threatened against BCOI or Developer, any liens
filed by the Internal Revenue Service against BCOI, Developer, the Property or
the Improvements as a result of deficiencies asserted against BCOI or Developer,
any audits of any Federal or State tax return of BCOI or Developer and the
results of any such audit, any default or dispute with any tenant, any dispute
pursuant to or default under the Transaction Documents by any party, any
condemnation or similar proceedings with respect to any of the Property or
Improvements, any proceeding seeking to enjoin the intended use of the
Improvements, any material changes in governmental requirements pertaining to
the Property or Improvements, utility availability or anticipated costs of
completion, and any other matters which could reasonably be expected to
materially adversely affect BCOI's ability to perform its obligations under this
Agreement.
15
SECTION 5.06 Books and Records. Maintain complete and accurate account books and
records its interest in the Property and the construction of the Improvements,
which books and records shall reflect the consistent application of GAAP, and
make such books and records available at reasonable times upon reasonable prior
notice for inspection and copying by Owner or its agent.
SECTION 5.07 Access and Promotion. Permit Owner and its agents to have access to
the Property and Improvements at all reasonable times during normal business
hours upon reasonable prior notice; provided, however, Owner shall not exercise
its right of access in a manner that unreasonably disrupts construction
activities; provide to Owner at BCOI's expense a sign in accordance with Owner's
specifications publicizing Owner's interest in the Property; and allow Owner to
maintain the sign on the Property, subject to any signage requirements and
restrictions of applicable law.
SECTION 5.08 Changes to the Site Plan and Plans and Specifications. Authorize or
permit no changes to the Site Plan or the Plans and Specifications (and if Plans
and Specifications have not yet been provided to and approved by Owner, then to
any working drawings) without the prior written consent of Owner, any Key
Tenants and all governmental bodies having jurisdiction to the extent such
approval by a governmental body is required by law or regulation.
Notwithstanding anything contained herein, (a) change orders shall not
increase the cost of construction of the Improvements (or if such change orders
increase the cost of construction of the Improvements and such changes are
approved by Owner, then, prior to making such changes, BCOI shall deposit with
Owner any increase in the costs of construction of the Improvements to be held
and disbursed as provided in Section 5.04 hereof); and (b) such changes must not
result in the Improvements having less value; and (c) such changes must not
affect the general appearance, structure or location of the Improvements or any
portion thereof; and (d) if any sureties have provided bonds in connection with
the construction of the Improvements, such changes must either (i) have the
prior written approval of all such sureties or (ii) such sureties have waived
the right to approve the same, and Construction Inspector (or another architect
or engineer designated by Owner) certifies in writing to Owner that such changes
do not constitute a substantial change in the Plans and Specifications and do
not constitute a change in the scope of the work under the Construction
Contract; and (e) Construction Inspector (or another architect or engineer
designated by Owner) certifies in writing to Owner that such changes do not
constitute a substantial change in the Plans and Specifications. BCOI hereby
agrees to promptly deliver to Owner copies of all "change orders.
SECTION 5.09 List of Contractors, Subcontractors, and Materialmen. Upon Owner's
written request, notify Owner promptly of the names and addresses of all
entities employed as contractors, subcontractors and materialmen in connection
with the construction of the Improvements.
SECTION 5.10 Lien Waiver. Deliver copies of waivers of liens (the originals of
which shall have been filed or are about to be filed, in the office of the
Prothonotary of the Court of Common Pleas of the County in which the Property is
situated), signed by the applicable contractor, subcontractor or materialman
engaged or to be engaged by BCOI or Developer or with whom BCOI or Developer
shall have any dealings with respect to construction of the Improvements,
waiving their right and the right of all subcontractors and parties acting
through or under them or any of them, to
16
file or maintain any mechanics' liens or claims against the Property and the
Improvements, or any interest of BCOI or Developer therein, which waivers shall
be executed and delivered to Owner prior to visible commencement of any work on
the Property by such contractor, subcontractor or materialman.
SECTION 5.11 Ownership of Personalty. Furnish to Owner, if Owner so requests,
copies of the contracts, bills of sale, receipted vouchers, and agreements, or
any of them, under which BCOI claims title to the materials, articles, fixtures
and other personal property used or to be used in the construction or operation
of the Improvements.
SECTION 5.12 Appraisals. Upon Owner's request and upon reasonable notice, permit
Owner and its agents, employees or contractors, to enter upon and appraise the
Improvements during normal business hours; cooperate with and provide any
information requested in connection with such appraisals; and reimburse Owner
for the cost of the first such reappraisal and any other reappraisal while an
Event of Default exists (provided, however, Owner shall not exercise its right
of access in a manner that unreasonably disrupts construction activities).
SECTION 5.13 Other Acts. Upon Owner's request, execute and deliver to Owner all
other documents and perform all other acts which Owner reasonably deems
necessary in connection herewith, to the extent permitted under applicable law.
SECTION 5.14 Construction Contracts. BCOI shall not enter into, modify, amend,
terminate or cancel any agreement or contract with the General Contractor, the
Development Agreement, the architect's contract or any Third Party Agreement,
without the prior written approval of Owner, which approval shall not be
unreasonably withheld. BCOI will furnish Owner promptly after execution thereof
executed copies of all contracts between BCOI, the General Contractor,
architects, engineers and contractors and all subcontracts between the General
Contractor or contractors and all of their subcontractors and suppliers, which
contracts and subcontracts may not have been furnished pursuant to Article III
of this Agreement.
ARTICLE VI
EVENTS OF DEFAULT
The occurrence of any of the events listed in this Article shall constitute
an "Event of Default" under this Agreement.
SECTION 6.01 Assignment or Conveyance. Assignment or attempted assignment by
BCOI of this Agreement, any rights hereunder, or any advance to be made
hereunder, or the conveyance, lease, mortgage, or any other alienation or
encumbrance of its interest in the Property or Improvements or any interest
therein without the prior written consent of Owner, except as otherwise
expressly permitted in the Transaction Documents; provided, however, that
notwithstanding any provision to the contrary in the Transaction Documents,
Developer may assign any Developer Fees and the Developer Bonus set forth in the
Development Agreement (or the right to receive any Developer Fees or the
Developer Bonus) owing to Developer under any Transaction Document in support of
any letter of credit, line of credit or other facility provided for the benefit
of Owner in connection with the Transaction Documents.
17
SECTION 6.02 Voluntary Insolvency Proceedings. The filing by BCOI, the Sole
Member or any other Person owned in majority interest or controlled by BCOI, of
a voluntary petition in bankruptcy or any such Person's adjudication as a
bankrupt or insolvent, or the filing by any such Person of any petition or
answer seeking or acquiescing in any reorganization, arrangement, composition,
readjustment, liquidation, dissolution or similar relief for itself under any
present or future federal, state or other statute, law or regulation relating to
bankruptcy, insolvency or other relief for debtors, or any such Person's seeking
or consenting to or acquiescence in the appointment of any trustee, receiver or
liquidator of any such Person or of all or any substantial part its property or
of any or all of the rents, revenues, issues, earnings, profits or income
thereof, or the making of any general assignment for the benefit of creditors or
the admission in writing by BCOI or any such Person of its inability to pay its
debts generally as they become due.
SECTION 6.03 Involuntary Insolvency Proceedings. The entry by a court of
competent jurisdiction of an order, judgment, or decree approving a petition
filed against BCOI, the Sole Member or any Person owned in majority interest or
controlled by BCOI seeking any reorganization, arrangement, composition,
readjustment, liquidation, dissolution or similar relief under any present or
future federal, state or other statute, law or regulation relating to
bankruptcy, insolvency, or other relief for debtors, which order, judgment or
decree remains unvacated and unstayed for an aggregate of sixty (60) days
(whether or not consecutive) from the date of entry thereof, or the appointment
of any trustee, receiver or liquidator of any such Person or of all or any
substantial part of its property or of any or all of the rents, revenues,
issues, earnings, profits or income thereof which appointment shall remain
unvacated and unstayed for an aggregate of sixty (60) days (whether or not
consecutive).
SECTION 6.04 Transfer. Except as otherwise permitted herein, the transfer of
BCOI's interest in, or rights under this Agreement by operation of law or
otherwise, including, without limitation, such transfer by BCOI as debtor in
possession under the Bankruptcy Code, or by a trustee for BCOI under the
Bankruptcy Code, to any third party, whether or not the obligations of BCOI
under this Agreement are assumed by such third party.
SECTION 6.05 Foreclosures or Liens. The institution of a foreclosure action
against the Property or Improvements or any part thereof, or the filing of a
lien against the Property or Improvements or any part thereof, which is not
removed of record or dismissed within sixty (60) days after BCOI receives notice
of such filing, unless BCOI has made arrangements satisfactory to Owner with
respect to such lien pursuant to Section 5.03 hereof and no foreclosure or other
possessory action against the Property or Improvements has been commenced.
SECTION 6.06 Casualty Loss. Substantial damage to, or partial or total
destruction of, the Improvements by fire or other casualty such that, in the
determination of Owner, the Improvements will not be restored, rebuilt and
completed on or before the Project Completion Date (as the same may be extended
pursuant to Section 6.08 hereof) and as a result of such damage or destruction
or the delay caused thereby, any tenant would have the right to terminate any
Key Tenant Lease, impose a penalty, or reduce or xxxxx rent, and such right has
not been waived by such tenant.
SECTION 6.07 Misrepresentation. If any certificate, statement, representation,
warranty or audit heretofore or hereafter furnished by or on behalf of BCOI
pursuant to or in connection with this
18
Agreement or otherwise (including, without limitation, representations and
warranties contained herein) or as an inducement to Owner to extend any credit
to or to enter into this or any other agreement with BCOI proves to have been
false in any material respect at the time as of which the facts therein set
forth were stated or certified or to have omitted any substantial contingent or
unliquidated liability or claim against BCOI or if on the date of execution of
this Agreement there shall have been any materially adverse change in any of the
facts previously disclosed by any such certificate, statement, representation,
warranty or audit, which change shall not have been disclosed to Owner at or
prior to the time of such execution.
SECTION 6.08 Failure to Complete Improvements. Except as allowed under Section
15.1 of the Development Agreement for force majeure events, failure by BCOI and
Developer to complete the construction of the Improvements and obtain a
certificate of occupancy or other final governmental approval of the
Improvements for their intended use on or before the Project Completion Date, or
the cessation of work on the construction of the Improvements for any period of
thirty (30) consecutive days.
SECTION 6.09 Failure to Perform Obligations. Failure by BCOI to perform any
term, condition or covenant of this Agreement not otherwise enumerated in this
Article VI, which failure is not cured within any applicable grace or cure
period therefor, and if no grace or cure period is provided therefor, within
thirty (30) days after demand by Owner.
SECTION 6.10 Cross Defaults. Any default, by BCOI, Developer, the Sole Member,
the Guarantors or any affiliate of any of them beyond any applicable grace or
cure period under the terms of any of the Transaction Documents to which such
Person is a party.
Nothing herein shall require notice except as expressly set forth herein or in
the other Transaction Documents. Notwithstanding the foregoing, no notice shall
be required if Owner is prevented from giving notice by bankruptcy or other
applicable law, and the cure period, if any, shall commence with the date of
such event rather than from the date of notice.
ARTICLE VII
REMEDIES UPON DEFAULT
SECTION 7.01 Remedies of Owner. Upon an Event of Default in Article VI hereof,
and following the expiration of any applicable grace or cure period, Owner may
if it so elects, without any notice or demand to BCOI (or to any other Person)
whatsoever (which notice or demand is expressly waived, except to the extent
otherwise specifically provided herein or in the other Transaction Documents),
exercise any or all (or none) of the following rights and remedies (all of which
rights and remedies shall be cumulative) as Owner, in its sole discretion, may
deem necessary or appropriate:
(a) Declare immediately due and owing all outstanding sums or other
obligations due to Owner hereunder or under any of the other Transaction
Documents.
(b) Exercise all or any of its rights or remedies granted herein, or in any
of the other Transaction Documents (including, but not limited to the right to
set off any or all of the obligations of BCOI against any or all of the property
of BCOI or any guarantor or indemnitor in
19
the possession or control of Owner) or under applicable law, or which it may
otherwise have, against BCOI or any guarantor or indemnitor or otherwise.
(c) Enter upon the Property and take possession thereof, together with the
Improvements in the course of construction or completed and all materials,
supplies and construction facilities and appliances located thereon, and proceed
either in Owner's name, in the name of BCOI, in the name of Developer, as the
attorney-in-fact of BCOI, as the attorney-in-fact of Developer (which authority
is coupled with an interest and is irrevocable by BCOI and Developer), as Owner
shall elect, to complete the Improvements at the cost and expense of BCOI and
Developer. If not assigned to Owner simultaneously with the execution of this
Agreement, if requested by Owner, BCOI and Developer shall immediately assign to
Owner, in writing, their rights under any contract or agreement with any
architect, engineer, contractor, supplier, consultant or representative that
Developer and/or BCOI has entered into in connection with the Property or the
Project; provided, however, Owner shall have no obligation to accept any such
assignment or assume any of BCOI's or Developer's obligations under any such
contracts. BCOI and Developer shall reimburse Owner, upon demand, all costs and
expenses incurred by Owner in connection with its exercise of the foregoing
rights, including, without limitation, reasonable attorneys' fees and expenses.
If Owner elects to complete or cause the Improvements to be so completed, it may
do so according to the terms of the Third Party Agreements (including the Plans
and Specifications) or according to such changes, alterations or modifications
in and to the Third Party Agreements and the Plans and Specifications as Owner
shall deem expedient or necessary, and Owner may enforce or cancel all or any of
the Third Party Agreements and any and all other contracts theretofore entered
into or make other contracts which, in Owner's opinion, may seem advisable, and
BCOI and Developer shall be liable, under this Agreement or any other
Transaction Document, to pay Owner upon demand any amount or amounts expended by
Owner or its representatives for such performance, together with any costs,
charges or expenses incident thereto or otherwise incurred or expended by Owner
or its representatives on behalf of BCOI and Developer in connection with the
Improvements, and the amounts so expended shall be immediately due and payable
to Owner and shall bear interest thereon at the Overdue Rate.
BCOI acknowledges that all rights privileges and remedies of Owner under this
Section 7.01(c) may, at Owner's option, be exercised by Owner without the
assumption by such party of any liabilities, obligations or responsibilities.
(d) Decline to disburse any additional Fundings to or for the benefit of
BCOI or any other Person.
SECTION 7.02 Failure to Exercise Remedies. Neither failure nor delay on the part
of Owner to exercise any right, remedy, power or privilege hereunder or under
any Transaction Document shall operate as a waiver thereof, nor shall any single
or partial exercise of any right, power or privilege hereunder or under any
Transaction Document preclude any other or further exercise thereof or the
exercise of any other right, power or privilege. The acceptance by Owner of any
partial payments under the Transaction Documents made by or on behalf of BCOI
after the occurrence of an Event of Default hereunder or under any Transaction
Document shall not be deemed a waiver or cure by Owner of said Event of Default
unless expressly agreed in writing by Owner.
20
ARTICLE VIII
MISCELLANEOUS
SECTION 8.01 Conflict of Transaction Documents. In the event of a conflict
between any of the provisions any other Transaction Document with this
Agreement, the provisions of this Agreement shall control.
SECTION 8.02 Exclusiveness. This Agreement is made for the sole protection of
BCOI, Developer and Owner, and their successors and assigns, and except as
expressly set forth herein, no other person or entity shall have any rights
hereunder.
SECTION 8.03 Notice. All notices provided for herein shall be made to such party
in the manner set forth in the Lease Agreement.
SECTION 8.04 Modification and Waiver. No provisions of this Agreement shall be
amended, waived or modified except by an instrument in writing signed by BCOI,
Developer and Owner.
SECTION 8.05 Materiality. All representations and warranties made herein shall
be deemed to have been material and relied on by Owner and shall survive the
execution and delivery of this Agreement and the disbursements of Fundings made
pursuant to this Agreement for a period of two (2) years from the date of the
Final Funding.
SECTION 8.06 Heading. All descriptive headings of articles and sections in this
Agreement are inserted for convenience only, and shall not affect the
construction or interpretation hereof.
SECTION 8.07 Severability. Inapplicability or unenforceability of any provisions
of this Agreement shall not limit or impair the operation or validity of any
other provision of this Agreement.
SECTION 8.08 CounterpartS. This Agreement may be executed in any number of
counterparts, each of which, when executed and delivered, shall be an original,
but such counterparts shall together constitute one and the same instrument.
SECTION 8.09 Assignability. Neither this Agreement, nor any rights or
obligations hereunder, nor any Funding to be made hereunder, is assignable by
BCOI; provided, however, that notwithstanding any other provision to the
contrary in any Transaction Document, Developer may assign any Developer Fees or
the Developer Bonus (or the right to receive any Developer Fees or the Developer
Bonus) owing to it under any Transaction Document in support of any letter of
credit, line of credit or other facility provided for the benefit of Owner in
connection with the Transaction Documents. Except as set forth in the preceding
sentence, BCOI and Developer shall not convey or encumber, or permit the
conveyance or encumbrance of (other than by the lessor as permitted under the
Lease Agreement), the Property, Improvements or other Leased Property, or any
interest therein, without the prior written consent of Owner, which consent
shall be in Owner's sole discretion. The rights of Owner under this Agreement
are assignable in part or in full, and any assignee of Owner shall succeed to
and be possessed of the rights of Owner hereunder to the extent of the
assignment made, including the right to make Fundings to or on behalf of BCOI or
any approved assignee of BCOI in accordance with this Agreement.
21
SECTION 8.10 No Agency Relationship. Owner is not the agent or representative of
BCOI or Developer, BCOI and Developer are not agents of Owner and this Agreement
shall not make Owner liable to the General Contractor, materialmen, contractors,
subcontractors, craftsmen, laborers or others for goods delivered to or services
performed by them upon the Property, or for debts or claims accruing to such
parties against BCOI or Developer. Except as expressly provided in the
Transaction Documents, there is no contractual relationship, either expressed or
implied, between Owner and the Developer, General Contractor or any materialmen,
subcontractors, craftsmen, contractors, laborers, or any other person supplying
any work, labor or materials for the Improvements or otherwise to the Property.
SECTION 8.11 Waiver. No course of dealing and no delay or omission by Owner in
exercising any right or remedy hereunder or with respect to any other
Transaction Documents shall operate as a waiver thereof or of any other right or
remedy, and no single or partial exercise thereof shall preclude any other or
further exercise thereof or the exercise of any other right or remedy. Owner may
remedy any default hereunder or Event of Default without waiving the default or
Event of Default remedied and without waiving any other prior or subsequent
default or Event of Default, and Owner shall be reimbursed by BCOI for any and
all of its expenses in so remedying such default or Event of Default. All rights
and remedies of Owner hereunder are cumulative.
BCOI agrees that upon any Event of Default under this Agreement, Owner shall
have the absolute right to make such use of the foregoing property so assigned
as Owner shall desire, and, as to any such property which is also the subject of
a security agreement or financing statement in favor of Owner, that Owner will
not be limited to remedies available under the Uniform Commercial Code, but may
at its option avail itself of the rights granted herein in addition to or in
substitution for its Uniform Commercial Code remedies.
SECTION 8.12 Costs and Expenses. BCOI will bear all taxes, fees, costs and
expenses (including reasonable fees and expenses of counsel for Owner and of the
Construction Inspector) in connection with the Transaction Documents (including
any amendments requested by BCOI and hereafter made), all funding and
administration hereunder and the recording of any of the Transaction Documents.
If, at any time, an Event of Default occurs or Owner becomes a party to any suit
or proceeding arising under or out of this Agreement or any of the Transaction
Documents, or if Owner is made a party to any suit or proceeding by virtue of
this Agreement or any Leased Property and as a result of any of the foregoing,
Owner employs counsel to advise or provide other representation with respect to
this Agreement, or to take any action in or with respect to any suit or
proceeding relating to this Agreement, any of the other Transaction Documents,
any Leased Property, BCOI, or to protect, collect, or liquidate any of the
Leased Property, or attempt to enforce any security interest or lien granted to
Owner by any of the Transaction Documents, then in any such events, the
reasonable attorney's fees arising from such services, including fees on appeal
and in any bankruptcy proceedings, and any reasonable out-of-pocket expenses,
costs and charges relating thereto shall constitute additional sums due from
BCOI and Developer to Owner payable within twenty (20) days from delivery of a
reasonably detailed written notice therefor from Owner to BCOI or Developer.
Without limiting the foregoing, BCOI has undertaken the obligation for payment
of, and shall pay, all recording and filing fees, revenue or documentary stamps
or taxes, intangibles taxes, transfer taxes, recording taxes and other taxes,
expenses and charges payable in connection with this Agreement and any of the
Transaction Documents or the filing of any financing statements or other
instruments
22
required to effectuate the purposes of this Agreement, and should BCOI fail to
do so, BCOI agrees to reimburse Owner for the amounts paid by Owner, together
with penalties or interest, if any, incurred by Owner as a result of
underpayment or nonpayment. This Section shall survive termination of this
Agreement.
SECTION 8.13 Attorneys' Fees. Any provisions of the Transaction Documents
providing for the payment of "attorneys' fees," "reasonable attorneys' fees" or
other words or provisions of similar import, shall mean attorneys' and paralegal
fees of outside counsel incurred based upon the usual and customary hourly rates
of the attorneys and paralegals involved for time actually spent by such
attorneys and paralegals and without giving effect to any statutory presumption
that may then be in effect.
SECTION 8.14 Warrant of Attorney. BCOI and Developer each hereby irrevocably
appoints Owner as attorney-in-fact, effectively after the occurrence and during
the continuance of an Event of Default, to do in its stead all things believed
by Owner reasonably necessary to effect performance of this Agreement and filing
notices in public records. The forgoing appointment is coupled with an interest
and is solely for protection of Owner's security and, therefore, is not intended
to confer any right of action on any third party. BCOI AND DEVELOPER EACH
SPECIFICALLY WAIVES ANY RIGHT TO ANY FORM OF NOTICE OR TO ANY ACKNOWLEDGMENT BY
AGENT WHICH MIGHT BE APPLICABLE PURSUANT TO THE PENNSYLVANIA PROBATE, ESTATES
AND FIDUCIARIES CODE ("PROBATE CODE"), AS AMENDED, TO ANY POWER OF ATTORNEY, OR
ANY WARRANT OF ATTORNEY TO CONFESS JUDGMENT, GRANTED HEREIN OR IN ANY OTHER
TRANSACTION DOCUMENT AND HEREBY DIRECTS THAT ANY POWER OF ATTORNEY, OR ANY
WARRANT OF ATTORNEY TO CONFESS JUDGMENT, GRANTED HEREIN OR IN ANY OTHER
TRANSACTION DOCUMENT NOT BE CONSTRUED IN ACCORDANCE WITH THE TERMS OF THE
PROBATE CODE.
SECTION 8.15 Consequential Damages. OWNER SHALL NOT BE RESPONSIBLE OR LIABLE FOR
ANY DAMAGES, CONSEQUENTIAL OR OTHERWISE, THAT MAY BE INCURRED OR ALLEGED BY BCOI
OR DEVELOPER OR BY ANY OTHER PERSON OR ENTITY AS A RESULT OF ANY OF THE
TRANSACTION DOCUMENTS OR THE EXERCISE OF THE TERMS THEREOF BY OWNER OR THE
COLLECTION BY OR ON BEHALF OF THE SUMS DUE THEREUNDER, UNLESS SUCH DAMAGES ARE
INCURRED AS A RESULT OF THE GROSS NEGLIGENCE OR WILLFUL MISCONDUCT OF OWNER.
SECTION 8.16 Indemnification. BCOI HEREBY INDEMNIFIES, HOLDS HARMLESS AND AGREES
TO DEFEND OWNER FROM AND AGAINST (A) ALL CLAIMS, DEMANDS, CAUSES OF ACTION
ASSERTED AGAINST OWNER BY ANY PERSON IF THE CLAIM, DEMAND OR CAUSE OF ACTION
DIRECTLY OR INDIRECTLY RELATES TO ANY CLAIM, LITIGATION, INVESTIGATION OR
PROCEEDING ARISING FROM OR RELATING TO: (I) A CLAIM, DEMAND OR CAUSE OF ACTION
THAT THE PERSON HAS OR ASSERTS AGAINST BCOI; (II) THE PAYMENT OF ANY COMMISSION,
CHARGE OR BROKERAGE FEE INCURRED IN CONNECTION WITH THIS AGREEMENT AND THE
TRANSACTION DOCUMENTS; (III) ANY ACT OR OMISSION OF BCOI, ANY CONTRACTOR,
SUBCONTRACTOR, ARCHITECT, ENGINEER, MATERIAL SUPPLIER, VENDOR OR OTHER PERSON
WITH RESPECT TO THE PROPERTY AND/OR THE PROJECT; OR (IV) ANY CLAIM OR CAUSE OF
ACTION OF ANY KIND BY ANY PERSON WHICH WOULD HAVE THE EFFECT OF DENYING OWNER
THE FULL BENEFIT OR PROTECTION OF ANY PROVISION OF ANY DOCUMENT; AND (B) ALL
LIABILITIES, LOSSES AND OTHER COSTS (INCLUDING COURT COSTS AND ATTORNEYS' FEES)
INCURRED BY OWNER AS A RESULT OF ANY CLAIM, DEMAND OR CAUSE OF ACTION DESCRIBED
IN CLAUSE (A) ABOVE, EXCEPT TO THE EXTENT OF LOSS PROVEN TO RESULT FROM OWNER'S
GROSS NEGLIGENCE OR WILLFUL MISCONDUCT. EXCEPT AS EXPRESSLY SET FORTH HEREIN,
THE
23
OWNER'S RIGHT TO INDEMNIFICATION SHALL NOT BE DIRECTLY OR INDIRECTLY LIMITED,
PREJUDICED, IMPAIRED OR ELIMINATED IN ANY WAY BY ANY FINDING OR ALLEGATION THAT
ANY CONDUCT IS ACTIVE, PASSIVE OR SUBJECT TO ANY OTHER CLASSIFICATION OR THAT
OWNER IS DIRECTLY OR INDIRECTLY RESPONSIBLE UNDER ANY THEORY OF ANY KIND FOR ANY
ACT OR OMISSION BY BCOI OR ANY OTHER PERSON. NOTWITHSTANDING THE FOREGOING, BCOI
SHALL NOT BE OBLIGATED TO INDEMNIFY OWNER WITH RESPECT TO ANY INTENTIONALLY TORT
OR ACT OF GROSS NEGLIGENCE WHICH OWNER IS PERSONALLY DETERMINED BY THE JUDGMENT
OF A COURT OF COMPETENT JURISDICTION (SUSTAINED ON APPEAL, IF ANY) TO HAVE
COMMITTED.
SECTION 8.17 GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF DELAWARE APPLICABLE TO CONTRACTS
EXECUTED AND PERFORMED IN SUCH STATE, WITHOUT GIVING EFFECT TO CONFLICTS OF LAW
PRINCIPLES.
SECTION 8.18 JURISDICTION AND VENUE. EACH OF THE PARTIES HERETO CONSENT TO
PERSONAL JURISDICTION IN THE STATE OF DELAWARE. EACH OF THE PARTIES HERETO AGREE
THAT ANY ACTION OR PROCEEDING ARISING FROM OR RELATED TO THIS AGREEMENT SHALL BE
BROUGHT AND TRIED EXCLUSIVELY IN THE STATE OR FEDERAL COURTS OF THE STATE OF
DELAWARE. EACH OF THE PARTIES HERETO IRREVOCABLY AND UNCONDITIONALLY WAIVES ANY
OBJECTION TO THE LAYING OF VENUE OF ANY SUCH ACTION OR PROCEEDING BROUGHT IN ANY
SUCH COURT. EACH OF THE PARTIES HERETO EXPRESSLY ACKNOWLEDGE THAT DELAWARE IS A
FAIR, JUST AND REASONABLE FORUM AND EACH OF THE PARTIES AGREE NOT TO SEEK
REMOVAL OR TRANSFER OF ANY ACTION FILED BY ANY OF THE PARTIES HERETO IN SAID
COURTS. FURTHER, THE PARTIES HERETO IRREVOCABLY AND UNCONDITIONALLY WAIVE ANY
CLAIM THAT SUCH SUIT, ACTION OR PROCEEDING HAS BEEN BROUGHT IN ANY INCONVENIENT
FORUM. SERVICE OF ANY PROCESS, SUMMONS, NOTICE OR DOCUMENT BY CERTIFIED MAIL
ADDRESSED TO A PARTY AT THE ADDRESS DESIGNATED PURSUANT TO SECTION 8.03 HEREOF
SHALL BE EFFECTIVE SERVICE OF PROCESS AGAINST SUCH PARTY FOR ANY ACTION OR
PROCEEDING BROUGHT IN ANY SUCH COURT. A FINAL JUDGMENT IN ANY SUCH ACTION OR
PROCEEDING BROUGHT IN ANY SUCH COURT MAY BE ENFORCED IN ANY OTHER COURT TO WHOSE
JURISDICTION ANY OF THE PARTIES IS OR MAY BE SUBJECT.
SECTION 8.19 WAIVER OF JURY TRIAL. TO THE EXTENT PERMITTED BY APPLICBALE LAW, AT
OWNER'S OPTION, BCOI AND DEVELOPER EACH HEREBY WAIVE ANY RIGHT THAT EITHER OF
THEM MAY HAVE TO A TRIAL BY JURY ON ANY CLAIM, COUNTERCLAIM, SETOFF, DEMAND,
ACTION OR CAUSE OF ACTION (A) ARISING OUT OF OR IN ANY WAY RELATED TO THIS
AGREEMENT, THE TRANSACTION DOCUMENTS OR (B) IN ANY WAY CONNECTED WITH OR
PERTAINING OR RELATED TO OR INCIDENTAL TO ANY DEALINGS OF OWNER AND/OR BCOI,
OWNER AND/OR DEVELOPER, AND BCOI AND DEVELOPER WITH RESPECT TO THE TRANSACTION
DOCUMENTS OR IN CONNECTION WITH THIS AGREEMENT OR THE EXERCISE OF ANY PARTY'S
24
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. BCOI AND DEVELOPER EACH AGREE THAT ANY PARTY MAY FILE A COPY OF THIS
AGREEMENT WITH ANY COURT AS WRITTEN EVIDENCE OF THE KNOWING, VOLUNTARY AND
BARGAINED AGREEMENT OF BCOI AND DEVELOPER IRREVOCABLY TO WAIVE THEIR RIGHTS TO
TRIAL BY JURY AS AN INDUCEMENT OF OWNER TO ENTER INTO THIS AGREEMENT AND THAT
ANY DISPUTE OR CONTROVERSY WHATSOEVER BETWEEN THE PARTIES HERETO SHALL INSTEAD
BE TRIED IN A COURT OF COMPETENT JURISDICTION BY A JUDGE SITTING WITHOUT A JURY.
* * *
[Signatures appear on following page.]
25
IN WITNESS WHEREOF, BCOI, Owner and Developer have caused this Agreement to
be executed as of the date first set forth above.
BCOI:
BUCKS COUNTY ONOCOPLASTIC INSTITUTE, LLC
By: /s/ Xxxxxx X. Xxxxxxxxxx, M.D.
------------------------------------
Xxxxxx X. Xxxxxxxxxx, M.D.
Its: Chief Manager
OWNER:
MPT OF BUCKS COUNTY, L.P.
BY: MPT OF BUCKS COUNTY, LLC
ITS: GENERAL PARTNER
BY: MPT OPERATING PARTNERSHIP, L.P.
ITS: SOLE MEMBER
By: /s/ Xxxxxx X. Xxxxx, Xx.
------------------------------------
Xxxxxx X. Xxxxx, Xx.
Its: President and Chief Executive
Officer
DEVELOPER:
DSI FACILITY DEVELOPMENT, LLC
By: /s/ Xxxxxx X. Xxxxxxxxxx, M.D.
------------------------------------
Xxxxxx X. Xxxxxxxxxx, M.D.
Its: Chief Manager
26
EXHIBIT A
LEGAL DESCRIPTION
[See attached.]
A-1
EXHIBIT B
DEVELOPMENT BUDGET
[See attached.]
B-1
EXHIBIT C
THIRD PARTY AGREEMENTS
1. Standard Form of Agreement Between Owner and Architect (1997 Edition)
entered into as of April 25, 2005, by and between Buck's County Institute,
LLC, as Owner, and DSI Facility Development, LC, as Architect,
incorporating the terms of that certain Standard Form of Architect's
Services (1997 Edition) executed by Xxxxxx Xxxxxxxxxx on April 29, 2005, as
amended by that certain Standard form of Amendment for the Agreement
Between Owner and Architect (1993 Edition) made as of April 24, 2005, as
further amended by that certain Rider to Standard Form of Agreement Between
Owner and Architect between Buck's County Oncoplastic Institute, LLC and
DSI Facility Development, LLC of even date herewith.
2. Agreement between Owner and Architect, dated as of September __, 2005, by
and between Buck's County Oncoplastic Institute, LLC and Xxxxxxx Xxxxxx
(subject to receipt of evidence of professional liability insurance).
3. Proposal #230595 dated May 29, 2003 by Hill-Rom to Diversified Specialty
Institutes, Inc., Customer #1126790.
4. Proposal #786714 dated March 4, 2005 by Hill-Rom to Diversified Specialty
Institutes, Inc., customer #250137.
5. Proposal by York International Corporation ("York") to Xx. Xxxxxx
Xxxxxxxxxx and Short Form of Agreement Between Owner and Engineer For
Professional Services, between York International and Diversified Specialty
Institutes executed by Diversified Specialty Institutes on April 21, 2005;
Purchase Order, dated September 12, 2005, by York, consisting of pages 1
and 2, and Exhibits A, B, and C (subject to receipt of evidence of required
insurance).
6. Letter of Agreement between Xxxxxx Xxxxxxx & Xxxxxx and Diversified
Specialty Institutes, dated as of October 27, 2004, regarding "Feasibility
Study; Glenview Corporate Center."
7. Letter of Agreement between Xxxxxx Xxxxxxx & Xxxxxx and Diversified
Specialty Institutes, dated as of November 10, 2004, regarding "Zoning
Hearing Board, Sketch Plan."
8. Letter of Agreement between Xxxxxx Xxxxxxx & Xxxxxx and Diversified
Specialty Institutes, dated as of November 30, 2004, regarding "Topographic
Survey & Preliminary Plans."
9. Letter of Agreement between Xxxxxx Xxxxxxx & Xxxxxx and Diversified
Specialty Institutes, dated as of February 2, 2005, regarding "Buck's
County Hospital/MOB Corp. Center."
10. Letter of Agreement between Xxxxxx Xxxxxxx & Xxxxxx and Diversified
Specialty Institutes, dated as of February 4, 2005, regarding "Change Order
No. 1; Wetlands Features, Floodplain."
11. Letter of Agreement between Xxxxxx Xxxxxxx & Xxxxxx and Diversified
Specialty Institutes, dated as of April 8, 2005, regarding "DSI - Hospital;
ALTA Survey."
12. Proposal for Geotechnical Investigation dated January 31, 2005, by Geotek
engineering company, accepted by Diversified Specialty Institutes on
February 4, 2005.
C-1
EXHIBIT D
SITE PLAN
[See attached.]
D-1
EXHIBIT E
DRAW REQUESTS
[See attached.]
E-1
SCHEDULE 4.01
Ownership of Buck's County Oncoplastic Institute, LLC
National Oncoplastic Institutes, Inc. ................................ 100.00%
Ownership of Developer
Diversified Specialty Institutes, Inc. ............................... 100.00%
S-1
