ESCROW AGREEMENT
AMONG
[INSERT THI LESSEE SUBSIDIARY],
MONARCH PROPERTIES, LP
AND
FIDELITY NATIONAL TITLE
INSURANCE COMPANY OF NEW YORK
DATED AS OF __________, 1998
ESCROW AGREEMENT
THIS ESCROW AGREEMENT (this "Agreement") is executed and delivered as of
the ____ day of __________, 1998 (the "Effective Date") among [INSERT THI LESSEE
SUBSIDIARY], a [Insert State] corporation ("Lessee"), MONARCH PROPERTIES, LP, a
Delaware limited partnership ("Purchaser") and FIDELITY NATIONAL TITLE INSURANCE
COMPANY OF NEW YORK ("Escrow Agent").
The circumstances underlying the execution and delivery of this Agreement
are as follows:
A. Concurrently herewith, Purchaser has purchased from Seller and leased to
Lessee three (3) health care facilities (the "Facilities") pursuant to a Master
Lease of even date herewith (the "Master Lease").
B. A condition of Purchaser's acquisition of the Facilities and lease to
Lessee is the agreement of Lessee to complete certain repairs and improvements
to the Facilities after the closing, and the payment to Escrow Agent by Lessee
of a certain amount to be held by Escrow Agent and paid to Lessee or other
payees designated by Lessee upon completion of such repairs and improvements or
paid to Purchaser in the event of the failure of Lessee to complete such repairs
and improvements, all in accordance with the terms and conditions set forth
below.
C. Capitalized words not defined herein shall have the definitions given
them in the Master Lease.
NOW, THEREFORE, Lessee, Purchaser and Escrow Agent agree as follows:
1. ESCROW DEPOSIT. Escrow Agent acknowledges the receipt of [Insert Amount]
($__________) and agrees to hold and deliver such sum according to the terms and
conditions hereinafter set forth.
2. CAPITAL EXPENDITURES. Lessee agrees that, within three hundred and
sixty-five (365) days from the date of this Agreement, it will complete the
capital repair and improvement activities described under the heading "Action
Required" and set forth opposite the name of the applicable Facility on attached
EXHIBIT A.
3. INSPECTION BY PURCHASER. Lessee shall (a) give Purchaser at least ten
(10) Business Days' prior written notice of any request for a disbursement of
escrowed funds, which notice shall include a copy of the certificate to be
delivered to Escrow Agent as required by Section 4 hereof with respect to such
disbursement, and (b) give Purchaser's representative
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or representatives access to the Leased Property at reasonable times, upon one
Business Day's prior notice, for the purpose of inspecting the capital repair
and improvement work.
4. REQUESTS FOR DISBURSEMENT OF ESCROWED FUNDS. Lessee shall present each
request for disbursement of escrowed funds to Purchaser in writing for its
approval, which shall not unreasonably be withheld or delayed. Each request
shall meet the requirements of Paragraph 5, below.
5. DISBURSEMENT OF ESCROWED FUNDS. Within two (2) Business Days following
receipt of Lessee's written request, Escrow Agent shall disburse to Lessee or to
such payees as may be designated by Lessee in its request for disbursement, out
of the funds held in escrow, the out-of-pocket costs and expenses incurred by
Lessee in connection with the performance by it of its obligations under
Paragraph 2 (the "Capital Expenditures"), upon presentation of a request for
disbursement, provided:
(A) No more than one (1) request for disbursement is submitted in any
calendar month;
(B) The total monthly request for disbursement is not less than
[Fifty Thousand Dollars ($50,000)], except for the final request
for disbursement which shall be in the amount of the undisbursed
balance of escrowed funds, and the requested disbursement
per-payee is not less than [Ten Thousand Dollars ($10,000)];
[SUBJECT TO REVIEW OF DOLLAR AMOUNTS]
(C) The request for disbursement is accompanied by:
(i) a certificate of Lessee executed by an officer of Lessee,
certifying that a portion of the work set forth on EXHIBIT A
has been completed, describing such portion of the work in
detail, and stating that the disbursement is sought for
costs and expenses incurred in completing such work;
(ii) either (x) evidence of the written approval of such
disbursement by Purchaser or (y), if Escrow Agent has not
received a Notice from Purchaser disapproving the proposed
disbursement, a statement of Lessee in the certificate
described in subsection (i) above to the effect that notice
of the request for disbursement, including a copy of such
certificate, was sent to Purchaser at least ten (10)
Business Days prior to the submission of the request.
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(D) Overhead incurred by Lessee or any Affiliate of Lessee, which is
expenses and obligations incurred by Lessee or any Affiliate of
Lessee in connection with the general operations of the
Facilities, shall not be deemed to be a cost or expense incurred
by Lessee in connection with the performance by it of its
obligations under Paragraph 2.
6. INVESTMENT OF ESCROWED FUNDS. Escrow Agent shall invest the funds held
in escrow by it in a separate money market account at Chase Manhattan Bank.
Interest earned on such funds shall belong to Lessee and be paid to Lessee in
accordance with its instructions to Escrow Agent. Lessee's Federal Tax
Identification Number is [Insert Number].
7. DISPUTES. In the event of any dispute among the parties hereto as to the
disposition of any funds held in escrow that is not resolved within ninety (90)
days after notice to the parties from Escrow Agent, Escrow Agent is hereby
authorized to deposit such funds with any court of competent jurisdiction and
commence an interpleader action naming the other parties hereto as defendants
with respect thereto, and upon such deposit Escrow Agent shall be relieved of
any further liability hereunder.
8. LIMITATION OF LIABILITY OF ESCROW AGENT. Escrow Agent shall have no
liability hereunder, except for damages, if any, resulting from Escrow Agent's
negligence or willful misconduct; it being understood that by its acceptance of
this escrow agency, Escrow Agent is acting in the capacity of a depositary and
is not as such responsible or liable for the sufficiency, correctness,
genuineness and/or receipt of instruments, documents or notices deposited and/or
received under this Escrow Agreement. Upon notice to the other parties hereto,
Escrow Agent may reimburse itself for any reasonable expenses, including
attorneys fees, which Escrow Agent may incur as a result of any legal
proceedings affecting this Escrow Agreement and/or the Escrow Agent's duties as
depository hereunder.
9. FAILURE TO COMPLETE WORK. In the event the work described on EXHIBIT A
has not been completed on or before the date specified in Section 2 hereof,
Purchaser may give Lessee and Escrow Agent written notice of such failure, and
in the event such work is not completed within fifteen (15) Business Days after
such notice, Purchaser (a) shall have the right to cause its employees, agents
and contractors to enter upon the Leased Property and complete such work at the
expense of Lessee, and to demand and receive any funds then remaining in escrow
to be applied towards reimbursement or payment for such expense, or (b) to
declare such failure to be an Event of Default under the Master Lease, entitling
Purchaser to the remedies provided in the Master Lease and by law, including,
among such remedies, the right to demand and receive any then undisbursed funds
in escrow.
10. NOTICES. Any notice, request or other communication to be given by any
party hereunder shall be in writing and shall be sent by registered or certified
mail, postage prepaid, by overnight delivery, hand delivery or facsimile
transmission to the following address:
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To Lessee: [Insert THI Lessee Subsidiary]
0000 Xxxxxxxx Xxxx
Xxxx Xxxx, Xxxxxxxxxxxx 00000
Attn: Xxxxxxx X. Xxxxxxxx
Telephone No.: 000-000-0000
Fax No.: 000-000-0000
With copy to: Xxxxxxxxxxx & Xxxxxxxx LLP
000 Xxxxx Xxxxx Xxxxxx
Xxxxxxxxxx, Xxxxxxxxxxxx 00000
Telephone No.: 000-000-0000
Fax No.: 000-000-0000
To Purchaser: Monarch Properties, LP
0000 Xxxxxxx Xxx Xxxxxxxxx - Xxxxx 000
Xxxxxx, Xxxxxxx 00000
Attn: Xxxx X. Xxxxx
Telephone No.: 000-000-0000
Fax No.: 000-000-0000
With copy to: LeBoeuf, Lamb, Xxxxxx & XxxXxx, L.L.P.
000 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Attn: Xxxx X. Xxxxxx, Xx.
Telephone No.: 000-000-0000
Fax No.: 000-000-0000
To Escrow Agent: Fidelity National Title Insurance Company
of New York
0 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: Xxxxxx Xxxxxxxx
Telephone No.: 000-000-0000
Fax No.: 000-000-0000
Notices shall be deemed given upon actual receipt.
11. CHOICE OF LAW; SEVERABILITY. This Agreement shall be construed in
accordance with the laws of the State of New York, without regard to its
conflict of laws provisions. If any provision in this Agreement is in conflict
with such laws, or is otherwise unenforceable for any reason whatsoever, such
provision shall be deemed null and void to the extent of such conflict
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or unenforceability, and it shall be severed from and shall not invalidate any
other provision of this Agreement.
SIGNATURE PAGE FOLLOWS
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IN WITNESS WHEREOF, the parties hereby execute this Escrow Agreement as of
the day and year first set forth therein.
[INSERT THI LESSEE SUBSIDIARY]
By:
-----------------------------------------
Name: Xxxxxxx X. Xxxxxxxx
---------------------------------------
Title: President
--------------------------------------
MONARCH PROPERTIES, LP
By: MP Operating, Inc., as General Partner
By:
-----------------------------------------
Name: Xxxx X. Xxxxx
---------------------------------------
Title: President and Chief Executive Officer
--------------------------------------
FIDELITY NATIONAL TITLE INSURANCE
COMPANY OF NEW YORK
By:
-----------------------------------------
Name: Xxxxxx Xxxxxxxx
---------------------------------------
Title: Senior Vice President
--------------------------------------
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