LEASE
HHC BROADVIEW, INC.
as LANDLORD
AND
HARBORSIDE OF CLEVELAND LIMITED PARTNERSHIP
as TENANT
TABLE OF CONTENTS
(continued)
-iv-
TABLE OF CONTENTS
-i-
ARTICLE 1. Definitions.........................................1
1.1 Definitions.......................................1
ARTICLE 2. Lease of Premises...................................6
2.1 Lease of Premises.................................6
2.2 Landlord's Title..................................6
ARTICLE 3. Conduct of Business by Tenant.......................6
3.1 Conduct of Business by Tenant.....................6
ARTICLE 4. Initial Term and Extension Terms...................8
4.1 Initial Term......................................8
4.2 Extension Terms...................................8
ARTICLE 5. Rent................................................8
5.1 Annual Base Rent..................................8
5.2 Payment of Rent...................................9
5.3 Net Lease.........................................9
5.4 Operating Lease..................................10
5.5 Continuing Obligation of Tenant..................10
5.6 Initial Replacement Reserve......................10
ARTICLE 6. Payment of Taxes, Assessments, Etc.................10
6.1 Payment of Impositions...........................10
6.2 Excluded and Substituted Taxes, etc..............11
6.3 Delivery of Real Estate Tax Bills to Tenant......11
6.4 Contest of Impositions...........................11
6.5 Joinder by Landlord..............................12
6.6 Appointment of Tenant as Landlord's
Attorney-in-Fact.................................12
6.7 Funding of Fee Mortgage Reserve Requirements.....13
ARTICLE 7. Additional Covenants of Landlord...................14
7.1 Certificate of Need..............................14
7.2 Fee Mortgage.....................................14
7.3 Cooperation......................................14
7.4 Notices..........................................14
ARTICLE 8. Compliance with Laws...............................14
8.1 Tenant's Compliance..............................14
8.2 Right To Contest Applicable Laws.................15
ARTICLE 9. Insurance and Indemnification......................15
9.1 Building Insurance...............................15
9.2 Liability Insurance..............................16
9.3 Professional Liability Insurance.................16
9.4 Rental Value Insurance...........................16
9.5 Coverage Changes; Other Insurance................16
9.6 Insurance Criteria...............................16
9.7 Evidence of Insurance............................17
9.8 Waiver of Subrogation............................17
9.9 Indemnification..................................18
ARTICLE 10. Utilities..........................................19
10.1 Utilities........................................19
10.2 Landlord's Services and Repairs..................19
ARTICLE 11. Control and Repairs................................19
11.1 Possession and Control...........................19
11.2 Tenant's Repair Obligations......................19
11.3 Applicable Standard for Repairs..................19
11.4 Equipment, Furniture and Fixtures................19
ARTICLE 12. Alterations and Additions..........................20
12.1 Alterations and Additions to the Improvements....20
ARTICLE 13. Landlord's Right to Perform Tenant's Covenants.....22
13.1 Landlord's Right to Perform......................22
13.2 Reimbursement By Tenant..........................22
ARTICLE 14. Damage and Destruction of the Premises.............22
14.1 Cancellation Due To Casualty.....................22
14.2 Damage...........................................23
14.3 Insurance Proceeds...............................23
ARTICLE 15. Condemnation.......................................24
15.1 Cancellation Due to Event of a Taking............24
15.2 Award............................................24
15.3 Restoration......................................24
ARTICLE 16. Assignment and Subletting..........................25
16.1 Assignments, etc.................................25
16.2 Partial Subleases................................25
16.3 Assignment to Permitted Assignees................25
ARTICLE 17. Fee Mortgages......................................26
17.1 Fee Mortgages....................................26
17.2 Subordination....................................26
17.3 Nondisturbance...................................26
17.4 Subordination of Fee Mortgagee...................26
17.5 Payments By Tenant on Behalf of Landlord.........26
ARTICLE 18. Default............................................27
18.1 Default by Tenant................................27
18.2 Cancellation of Lease by FHA Commissioner........29
18.3 Tenant Bankruptcy Provisions.....................29
ARTICLE 19. Quiet Enjoyment....................................30
19.1 Quiet Enjoyment..................................30
ARTICLE 20. Estoppel Certificates..............................30
20.1 Tenant's Certificate.............................30
20.2 Landlord's Certificate...........................31
ARTICLE 21. Surrender; Holding Over............................31
21.1 Surrender........................................31
21.2 Holding Over.....................................31
ARTICLE 22. Right of First Offer...............................31
22.1 Tenant's Right of First Offer....................31
ARTICLE 23. General Provisions.................................32
23.1 Severability.....................................32
23.2 Notices..........................................32
23.3 Waiver of Jury Trial.............................33
23.4 Consent of Either Party..........................33
23.5 Payments Under Protest...........................34
23.6 No Oral Modification.............................34
23.7 Covenants To Bind and Benefit Respective Parties.34
23.8 Captions and Table of Contents...................34
23.9 Memorandum of Lease..............................34
23.10 Waiver...........................................34
23.11 Governing Law....................................34
23.12 Business Days....................................34
23.13 Time of the Essence..............................34
23.14 Delays...........................................35
23.15 No Broker........................................35
23.16 Authority........................................35
23.17 Attorneys' Fees and Litigation...................35
23.18 Further Assurances...............................35
23.19 Counterparts.....................................35
23.20 Landlord's Exculpation...........................35
LEASE
THIS LEASE (the "Lease") dated this 26th day of September, 2000, by and
between HHC BROADVIEW, INC., a Delaware corporation (the "Landlord"), and
HARBORSIDE OF CLEVELAND LIMITED PARTNERSHIP, a Massachusetts limited partnership
(the "Tenant").
PRELIMINARY STATEMENT:
---------------------
Capitalized terms used but not defined in this Preliminary Statement
have the meanings set forth in Article 1 hereof or otherwise in this Lease.
Landlord is the owner of the land located at 0000 Xxxx Xxxxxxxx Xxxx,
Xxxxxxxxx Xxxxxxx, Xxxx and legally described in Exhibit A attached hereto (the
"Land").
The Land is currently improved with a 159-bed nursing home facility
currently known as Harborside Healthcare - Broadview Heights (the "Facility").
Landlord desires to lease to Tenant, and Tenant desires to lease from
Landlord, the Premises.
Concurrent with the execution of this Lease, Landlord and Tenant have
entered into an Option to Purchase Agreement with regard to the Premises (the
"Option Agreement").
NOW, THEREFORE, FOR AND IN CONSIDERATION of the foregoing recitals, the
mutual covenants and agreements herein contained and of other good and valuable
consideration, Landlord and Tenant hereby agree as follows:
ARTICLE 1.
Definitions
1.1 Definitions. For the purposes of this Lease, the following terms shall have
the following meanings:
(a) "Affiliate" means any Person which, directly or indirectly, controls, is
controlled by, or is under common control with Tenant or Harborside.
(b) "Annual Base Rent" is defined in Section 5.1 hereof.
(c) "Applicable Laws" is defined in Section 8.1 hereof.
(d) "Appurtenant Rights" means the right, title and interest of Landlord in and
to:
(i) Any strips and gores of land adjoining the Land on any side thereof;
(ii) Any land lying in the bed of any street or avenue abutting the Land, to the
center line thereof; and
(iii)Any easements or other rights in property adjoining the Land to the
benefit of Landlord by reason of Landlord's ownership of the Land.
(e) "Control" (including "controlled by" and "under common control with"), used
with respect to any Person, means the possession, directly or indirectly,
of the power to direct or cause the direction of the management and policy
of a particular Person, whether through the ownership of voting securities,
by contract, or otherwise.
(f) "Consumer Price Adjustment Factor" means: the difference between (i) the
fraction, the numerator of which is the Consumer Price Index in effect as
of the first day of a Lease Year for which Annual Base Rent is being
calculated and the denominator of which is the Consumer Price Index in
effect as of the first day of the immediately preceding Lease Year, and
(ii) 1.0.
(g) "Consumer Price Index" means the Consumer Price Index for Urban Wage
Earners and Clerical workers, All Items-U.S. Cities Average (1982-84=100),
published by the Bureau of Labor Statistics, U.S. Department of Labor;
provided, that if the compilation of the Consumer Price Index in its
present form and calculated on its present basis is discontinued or
transferred to any other governmental authority, then the index most
similar to the Consumer Price Index published by the Bureau of Labor
Statistics shall be used. If there is no such similar index, a substitute
index which is then generally recognized as being similar to the Consumer
Price Index shall be used, with such substitute index to be reasonably
selected by Landlord.
(h) "Date of Taking" is defined in Section 15.1 hereof.
(i) "Default" is defined in Section 18.1 hereof.
(j) "Excess Equipment" is defined in Section 11.4 hereof.
(k) "Extension Terms" is defined in Section 4.2 hereof.
(l) "FF&E" means the fixtures, furnishings, furniture, equipment and machinery
owned by Landlord and used in or in connection with the operation of the
Facility as of the Lease Commencement Date, together will all replacements
thereof acquired by Tenant during the Term in accordance with Section 11.4
hereof.
(m) "Facility" is defined in the Preliminary Statement.
(n) "Fee Mortgage" is defined in Section 17.1 hereof.
(o) "Fee Mortgage Debt Service" means the monthly principal and interest
payments then due and owing under any Fee Mortgage.
(p) "Fee Mortgage Obligations" means the Fee Mortgage Debt Service and the Fee
Mortgage Reserve Requirements, if any.
(q) "Fee Mortgage Reserves" means the reserves or escrows, if any, for real
estate taxes, insurance, property replacement costs and mortgage insurance
premiums which are from time to time established and maintained by any Fee
Mortgagee under any Fee Mortgage.
(r) "Fee Mortgage Reserve Requirements" means the monthly or other periodic
payments required to be made into any Fee Mortgage Reserves.
(s) "Harborside" means Harborside Healthcare Corporation, a Delaware
corporation, and any Successor Company of Harborside Healthcare
Corporation.
(t) "Indemnified Party" is defined in Section 9.9 hereof.
(u) "Indemnifying Party" is defined in Section 9.9 hereof.
(v) "Initial Fee Mortgage" is defined in Section 17.1 hereof.
(w) "Initial Fee Mortgagee" means Beacon Hill Mortgage Corp.
(x) "Impositions" is defined in Section 6.1 hereof.
(y) "Improvements" means the buildings and improvements erected on the Land
(including, without limitation, the Facility), all replacements thereof,
all new or additional buildings erected on the Land, and all alterations,
additions and improvements made to the Land or such buildings during the
Term title to which vests in the Landlord.
(z) "Initial Term" is defined in Section 4.1 hereof.
(aa) "Land" is defined in the Preliminary Statement.
(bb) "Landlord" is defined in the Preamble of the Lease.
(cc) Intentionally Deleted
(dd) "Landlord's Transfer Terms" is defined in Section 22.1 hereof.
(ee) "Lease" is defined in the Preamble of this Lease.
(ff) "Lease Commencement Date" means September 26, 2000.
(gg) "Lease Year" means each consecutive twelve month period during the Term
beginning on the Lease Commencement Date.
(hh) "Net Award" is defined in Section 15.2 hereof.
(ii) "Net Insurance Proceeds" is defined in Section 14.3 hereof.
(jj) "Option Agreement" is defined in the Preliminary Statement.
(kk) "Optionee" means Tenant or its permitted assignee, as optionee under the
Option Agreement.
(ll) "Optionor" means the Landlord or its successor in interest, as optionor
under the Option Agreement.
(mm) "Other Leases" means (i) that certain Lease of even date herewith between
HHC Xxxxxxx, Inc. and Tenant with respect to the premises currently known
as Harborside Healthcare - Westlake I and Westlake II, and (ii) that
certain Lease of even date herewith between HHC Beachwood, Inc. and Tenant
with respect to the premises currently known as Harborside Healthcare -
Beachwood, each as the same may be amended, modified or supplemented from
time to time.
(nn) "Permitted Assignee" means any Affiliate, Subsidiary, Successor Company, or
Qualified Assignee.
(oo) "Permitted Encumbrances" means the encumbrances, mortgages, liens, charges
and security interests set forth in Exhibit B attached hereto.
(pp) "Permitted Use" is defined in Section 3.1 hereof.
(qq) "Person" means any individual, partnership, corporation, limited liability
company or partnership, association, trust, joint venture, unincorporated
organization, or entity, and any department, agency or subdivision thereof.
(rr) "Premises" means the Land, Improvements, Appurtenant Rights and FF&E.
(ss) "Purchase Option" means the option to purchase the Premises granted by
Optionor to Optionee pursuant to the Option Agreement.
(tt) "Qualified Assignee" means any Person with the financial capacity and
operating experience necessary to operate the Facility as a first-class
nursing home (other than Harborside, an Affiliate, a Subsidiary or a
Successor Company) designated by Tenant, with the prior written consent of
Landlord, not to be unreasonably withheld or delayed.
(uu) "Qualifying Non-Disturbance Agreement" is defined in Section 17.3 hereof.
(vv) "Reference Rate" means twelve percent (12%) per annum.
(ww) ""Rental Adjustment" is defined in Section 5.1 hereof.
(xx) "Revised Expiration Date" is defined in Section 14.1 hereof.
(yy) "State" means the State of Ohio.
(zz) "Subsidiary" means any Person (i) controlled by Tenant or Harborside, and
(ii) not less than fifty percent (50%) of whose outstanding vote stock,
partnership interests or other beneficial ownership interests shall at the
time be owned, directly or indirectly by Tenant or Harborside.
(aaa)"Successor Company" means any Person with the financial capacity and
operating experience necessary to operate the Facility as a first-class
nursing home (i) resulting from the merger or consolidation with or into
Harborside, and (ii) that acquires all or substantially all of the assets
or capital stock of Harborside.
(bbb) "Tenant" is defined in the Preamble of this Lease.
(ccc) "Tenant's Transfer Terms" is defined in Section 22.1 hereof.
(ddd) "Term" is defined in Section 4.2 hereof.
(eee) "Termination Date" means the conclusion of the last day of the Term.
(fff)"Threshold Amount" means $250,000.00, which amount shall be increased on
each anniversary of the Lease Commencement Date by the increase, if any, in
the Consumer Price Index using the first Lease Year as the base year for
comparison purposes.
(ggg)"Transfer" means the sale, lease, conveyance, transfer or other
disposition of all of the Premises or any part of the Premises required by
Tenant for the lawful operation of the Facility (other than upon the
foreclosure of any Fee Mortgage) or the transfer of a controlling interest
in the Landlord, whether by stock transfer, merger, consolidation or
otherwise.
(hhh) "Transfer Notice" is defined in Section 22.1 hereof.
(iii) "Trustee" is defined in Section 14.3 hereof.
ARTICLE 2.
Lease of Premises
2.1 Lease of Premises. Landlord hereby leases and demises to Tenant and Tenant
hereby leases and takes from Landlord, for the Term, at the rental and upon the
covenants and conditions hereinafter set forth, the Premises.
2.2 Landlord's Title . Landlord represents and warrants, upon which
representations and warranties Tenant has relied in the execution of this Lease,
that (i) Landlord is the owner of the Premises in fee simple absolute, free and
clear of all liens and encumbrances except the Permitted Encumbrances; (ii)
Landlord has full right and power to execute and perform this Lease and to grant
the estate demised herein; and (iii) the Premises include all of the real estate
which is owned by Landlord in or around the Facility or contiguous thereto. The
Premises are leased in "AS IS," "WHERE IS" condition as of the date hereof,
subject to all defects, structural or non-structural, latent or patent, know or
unknown, including (i) the presence of materials and/or substances which do or
may violate any future building codes, (ii) the existing state of title
including all covenants, conditions, and all matters of record (including,
without limitation, the matters set forth on Exhibit B hereto), and (iii) all
Applicable Laws, and all matters, whether or not of a similar nature, which
would be disclosed by an inspection of the Premises or by an accurate survey
thereof. Without limiting the foregoing, Tenant agrees that, regardless of the
physical or environmental condition of the Premises, Tenant shall have no claim,
or right of action, against Landlord under this Lease or otherwise at law or in
equity pertaining to, or arising from, the nature or condition of the Premises,
except as expressly provided in this Lease.
ARTICLE 3.
Conduct of Business by Tenant
3.1 Conduct of Business by Tenant. Tenant covenants and agrees during the Term
that:
(a) Tenant shall continuously use the Premises as a nursing home with 159 beds,
or such other number of beds as Tenant may determine appropriate, subject
to the prior written consent of Landlord, not to be unreasonably withheld
or delayed, and, at Tenant's election, for the provision of such other
health care services as may be permitted under Applicable Law which are
ancillary to Tenant's operation of the Premises as a nursing home,
including, without limitation, the provision of subacute care services,
home health care services, and outpatient therapy services, and Tenant may
locate on the Premises such physician and other health care professional
and administrative offices as may be ancillary to Tenant's operation of the
Premises as a nursing home (collectively, the "Permitted Use"); and Tenant
shall not use the Premises for any other purposes without the prior written
consent of Landlord, which consent may be withheld at the sole and absolute
discretion of Landlord. Notwithstanding the foregoing, any portion of the
Premises not used by Tenant as of the Lease Commencement Date in connection
with the operation of the Facility may be used for any purpose not
inconsistent with Tenant's use of the Premises to operate the Facility as a
nursing home, subject to Applicable Law.
(b) Tenant shall maintain good standing and all material licenses,
certifications and approvals from federal, state and local governmental and
administrative agencies having jurisdiction and authority over Tenant and
the operation of the Facility as a nursing home, including without
limitation, all nursing home licenses required from the State and all
licenses required for any material ancillary uses for which the Premises
are used. Upon request, Tenant shall provide Landlord with copies of the
aforesaid licenses, certifications and approvals. Tenant also shall
promptly provide Landlord with notice of any delicensure or decertification
proceedings affecting Tenant's operation of the Facility.
(c) To the extent the Premises are subject to a Fee Mortgage that is insured or
otherwise supported by an agency of the Federal, state or local government,
such as HUD or FHA, Tenant will comply with all requirements imposed with
respect to the use, occupancy and operation of the Premises by such
governmental agencies, including but not limited to submitting certified
financial statements and reports, maintaining reserves and escrow accounts
required of Tenant under Tenant's regulatory agreement with HUD, if any,
and Tenant shall enter into such regulatory agreements, covenants and like
contracts applicable to Tenant as lessee of the Premises if and to the
extent prescribed by such governmental agencies.
(d) Tenant shall not use, occupy or permit the Premises to be used or occupied,
nor do or permit anything to be done in or on any of the Premises in a
manner which would (i) violate any present (or, after a change of use,
future) certificate of occupancy or equivalent certificate affecting any of
the Premises, (ii) make void or voidable any insurance then in effect with
respect to any of the Premises, (iii) materially and adversely affect in
any manner the ability of Tenant to obtain fire and other insurance which
Tenant is required to furnish hereunder, (iv) cause any injury or damage to
the Improvements (excluding reasonable wear and tear resulting from nursing
home operations), or (v) constitute a public or private nuisance or waste;
provided that all of the foregoing shall be qualified to the extent
otherwise provided elsewhere in this Lease.
ARTICLE 4.
Initial Term and Extension Terms
4.1 Initial Term. Tenant shall have and hold the Premises, subject to the terms,
covenants, agreements, provisions, conditions and limitations hereof, for a term
of fifteen (15) years (the "Initial Term") commencing on the Lease Commencement
Date and ending on the last day of the month in which the fifteenth (15th)
anniversary of the Lease Commencement Date falls, unless such term is extended
pursuant to Section 4.2 hereof or unless such term is sooner terminated as
provided for herein.
4.2 Extension Terms. Upon the expiration of the Initial Term and provided Tenant
is not in default hereunder at the expiration of the Initial Term or the then
existing Extension Term (as defined herein), this Lease may be extended at the
sole option of Tenant for two (2) additional five (5) year terms (each, an
"Extension Term", and collectively the "Extension Terms") upon Tenant giving
written notice to Landlord at least two hundred seventy (270) days before the
expiration of the Initial Term or the then existing Extension Term (but not more
than three hundred sixty-five (365) days before the expiration of the Initial
Term or the then existing Extension Term) of Tenant's intention to extend the
Lease at the end of the Initial Term or the then existing Extension Term, in
which event the Lease shall be extended for the applicable Extension Term in
accordance with the terms and conditions set forth in this Lease. The Initial
Term and the Extension Terms, if any, are hereinafter sometimes collectively
referred to herein as the "Term". Notwithstanding anything to the contrary
herein, in the event the Tenant exercises the Purchase Option under the Option
Agreement, the Term shall automatically be extended through the Closing Date
under the Option Agreement in accordance with the same terms and conditions set
forth in this Lease.
ARTICLE 5.
Rent
5.1 Annual Base Rent . Tenant shall pay to Landlord, in such currency of the
United States of America, as at the time of payment shall be legal tender for
payment of private and public debts, annual base rent (the "Annual Base Rent").
The Annual Base Rent shall be in the amount of One Million One-Hundred Sixty-One
Thousand Five Hundred Forty-One Dollars ($1,161,541) per annum for the first
(1st) Lease Year; and commencing in the second (2nd) Lease Year and continuing
through the remainder of the Initial Term, the Annual Base Rent for each
applicable Lease Year shall be an amount equal to the lesser of (i) the Annual
Base Rent for the immediately preceding Lease Year increased by an amount equal
the Rental Adjustment applicable to such Lease Year as set forth below, and (ii)
the product obtained by multiplying the Annual Base Rent for the immediately
preceding Lease Year by the product of five (5) multiplied by the applicable
Consumer Price Adjustment Factor. The Annual Base Rent payable in each Lease
Year of the first Extension Term shall be an amount equal to the fair market
value thereof as determined jointly by Landlord and Tenant; provided, however,
that such Annual Base Rent shall be not less than the Annual Base Rent payable
for the last Lease Year of the Initial Term. The Annual Base Rent payable in
each Lease Year of the second Extension Term shall be an amount equal to the
fair market value thereof as determined jointly by Landlord and Tenant;
provided, however, that such Annual Base Rent shall be not less than the Annual
Base Rent payable for last Lease Year of the first Extension Term. The Rental
Adjustment for each Lease Year commencing in the second Lease Year through the
remainder of the Initial Term shall be as follows:
Lease Year Rental Adjustment
2 $20,908
3 $20,102
4 $19,241
5 $18,327
6 $17,362
7 $16,347
8 $15,286
9 $14,180
10 $13,033
11 $13,163
12 $13,295
13 $13,428
14 $13,562
15 $13,698
5.2 Payment of Rent. Annual Base Rent shall be paid:
(a) in equal monthly installments, in advance, on the first day of each month
of the Term; provided that if the Term does not begin or end on the last
day of a month, the Annual Base Rent for that partial month shall be
prorated by multiplying the monthly rent by a fraction, the numerator of
which is the number of days of the partial month included in the Term and
the denominator of which is the total number of days in the full calendar
month; and,
(b) to Landlord, at the address set forth in Section 23.2 hereof, or as
Landlord otherwise may specify in writing to Tenant; provided, however,
that Landlord shall have the right, by written instruction to Tenant, to
require Tenant to pay any Fee Mortgage Obligations then due and payable (up
to the amount of the Annual Base Rent then due and payable) directly to the
Fee Mortgagee, and if Landlord exercises such right, the amount of the Fee
Mortgage Debt Service (but not the Fee Mortgage Reserve Requirements) paid
by Tenant directly to the Fee Mortgagee shall be credited against and
applied toward Tenant's Annual Base Rent obligations hereunder. Tenant
shall provide Landlord with a copy of each payment of any Fee Mortgage
Obligation made by Tenant directly to the Fee Mortgagee concurrent with
Tenant's making of such payment to the Fee Mortgagee. Landlord may rescind
the rights granted Tenant under this Section 5.2(b) at any time on 30 days
written notice.
5.3 Net Lease. It is the intent of the parties that this is an absolute net
lease and that the Annual Base Rent shall, except as otherwise specifically
provided herein, be absolutely net to Landlord, so that this Lease shall yield,
net to Landlord, the Annual Base Rent specified herein during the Term free of
any charges, assessments, impositions, taxes or deductions of any kind and
without abatement, deduction, or set-off whatsoever and under no circumstances
or conditions, whether now existing or hereafter arising, or whether beyond the
present contemplation of the parties, shall Landlord be expected or required to
make any payment of any kind whatsoever, and all costs, capital improvements,
reserves, escrows, impositions, taxes, expenses and obligations of every kind
whatsoever relating to the Premises, which may arise or become due during the
Term of this Lease (excluding any Fee Mortgage Debt Service and any other
amounts payable by Landlord under any Fee Mortgage other than Fee Mortgage
Reserve Requirements) shall be paid by Tenant and deemed to be additional rent
due hereunder; it being understood that nothing herein shall be in derogation of
Landlord's rights or Tenant's obligations under Section 5.2 (b) hereof.
5.4 Operating Lease. Landlord and Tenant agree to treat this Lease as an
operating lease for tax and all other reporting purposes.
5.5 Continuing Obligation of Tenant. Tenant shall remain obligated under this
Lease in accordance with its terms and shall not take any action to terminate,
rescind, avoid or surrender this Lease, notwithstanding any action for
bankruptcy, insolvency, reorganization, liquidation, dissolution or other
proceeding affecting Landlord or any assignee of Landlord or any action with
respect to this Lease which may be taken by any trustee, receiver or liquidator
or by any court. Except as expressly provided in this Lease, Tenant hereby
waives all right to any abatement, deferment, reduction, set-off, counterclaim
or defense with respect to any Annual Base Rent or other rent payable hereunder.
Tenant shall remain obligated under this Lease in accordance with its terms and
Tenant hereby waives any and all rights now or hereafter conferred by statute or
otherwise to modify or to avoid strict compliance with its obligations under
this Lease. Notwithstanding any such statute or otherwise, Tenant shall be bound
by all the terms and provisions contained in this Lease.
5.6 Initial Replacement Reserve. Tenant shall deposit with Landlord on the Lease
Commencement Date an amount equal to the initial replacement reserve requirement
set forth in that certain HUD firm commitment letter dated June 29, 2000
relating to FHA Project # 042-22022 (Broadview), as the same may be from time to
time amended by HUD (the "Initial Replacement Reserve"). Landlord shall have the
right to use the Initial Replacement Reserve solely for the purpose of funding
Landlord's initial replacement reserve requirement under the HUD firm commitment
letter for FHA Project # 042-22022, and such funds shall be used solely in
accordance with the replacement reserve provisions set forth in the Initial Fee
Mortgage and other agreements among Landlord, HUD and the Fee Mortgagee. Upon
the earlier to occur of the (i) release by the Fee Mortgagee of the Initial
Replacement Reserve, (ii) discharge of the Initial Fee Mortgage, or (iii)
termination of this Lease, the outstanding balance of the Initial Replacement
Reserve, if any, shall be paid over to Tenant, provided no Default by the Tenant
has occurred and is then continuing.
ARTICLE 6.
Payment of Taxes, Assessments, Etc.
6.1 Payment of Impositions. Tenant shall provide proof to Landlord that it has
paid or cause to be paid and discharged directly to the appropriate governmental
authorities (subject to any Fee Mortgage reserve or escrow requirements), as
additional rent hereunder, before any fine, penalty, interest or cost may be
added thereto (or, if the bills therefor are directed to Landlord and Landlord
fails to submit same to Tenant in a timely manner sufficient to permit Tenant to
comply with the foregoing, then within ten (10) business days after Landlord's
submission of such bills to Tenant), all real estate taxes, personal property
taxes, any other taxes, sewer rents, water meter and water charges, excises,
levies, license and permit fees, occupancy and rent taxes, charges for public
utilities, special charges, including one-time or special assessments, and all
other charges or burdens of whatsoever kind and nature, and whether general or
special, ordinary or extraordinary, foreseen or unforeseen, which at any time
during the Term may be assessed, levied, confirmed, imposed upon, or become due
and payable out of, or in regard of, or become a lien on the Premises, or any
part thereof or any appurtenance thereto, excluding any tax, assessment or
charge described in Section 6.2 hereof (hereinafter referred to as
"Impositions", and any one of the same being hereinafter referred to as an
"Imposition"); provided, however, that:
(a) if, by law, any Imposition may at the option of the taxpayer be paid in
installments (whether or not interest shall accrue on the unpaid balance of
such Imposition), Tenant may exercise the option to pay the same, including
any accrued interest on the unpaid balance of such Imposition, in
installments and, in such event, shall pay such installments as may become
due during the Term; and
(b) all Impositions for the fiscal or tax years in which the Term begins and
ends shall be apportioned so that Tenant shall pay only those portions
thereof which correspond with the portion of said years as are within the
Term.
6.2 Excluded and Substituted Taxes, etc. Nothing in this Lease contained shall
require Tenant to pay municipal, county, state or federal income taxes assessed
against Landlord, or municipal, state or federal capital levy, gift, franchise,
estate, succession, inheritance or transfer taxes of Landlord, or any income
excess profits imposed upon Landlord or any income, profits, or revenue tax,
assessment or charge imposed upon the Annual Base Rent payable by Tenant under
this Lease; provided, however, that, if at any time during the Term, the methods
of taxation prevailing on the Commencement Date shall be altered so that in lieu
of, as a substitute for the whole or any part of, or an addition to any
Imposition now levied, assessed or imposed on real estate and the improvements
thereon, there shall be levied, assessed and imposed a tax, assessment, levy,
imposition or charge, wholly or partially as a capital levy, or otherwise, on
the rents received therefrom, or, by or based in whole or in part, upon the
Premises, and imposed upon Landlord, then all such taxes or assessments, or the
part thereof so measured or based, shall be deemed to be included within the
term "Impositions" for the purposes hereof to the extent that the same would be
payable if the Premises were the only property of Landlord subject to such
Impositions, and Tenant shall pay and discharge the same as herein provided in
respect of the payment of other "Impositions".
6.3 Delivery of Real Estate Tax Bills to Tenant . Landlord shall request the
appropriate taxing authority to mail any and all real estate tax bills covering
the Premises to Tenant with copies to Landlord. Tenant shall pay the same
directly to said taxing authorities as hereinabove provided and shall furnish
Landlord with proof of payment when the same is paid; or if such real estate tax
xxxx is to be paid by the Fee Mortgagee, Landlord shall mail such xxxx to the
Fee Mortgagee, with a copy to Tenant. Within ten (10) days of receipt by
Landlord of any notice relating to the assessment or reassessment of any
Imposition relating to the Premises, Landlord shall deliver such notice to
Tenant.
6.4 Contest of Impositions. Upon giving prior written notice to Landlord and
subject to the provisions of any Fee Mortgage, Tenant shall have the right to
seek a reduction in the valuation or an exemption of the Premises for tax
purposes and to contest or review the amount or validity, in whole or in part,
of any Imposition by appropriate proceedings or such other manner as Tenant may
deem suitable and is permitted under applicable laws. Tenant shall conduct such
contest or review at Tenant's own cost and expense and in a diligent and good
faith manner. Any settlement reached by Tenant under this Section 6.4 is subject
to Landlord's reasonable written approval. Tenant's rights under this Section
6.4 shall be subject to the following:
(a) If by the terms of any such Imposition, payment thereof, pending the
contest or review thereof, may legally be delayed without the incurrence of
any lien, charge or liability of any kind against the Premises or any part
thereof, or any diminution in the value of the Premises, and without
subjecting Tenant or Landlord or any Fee Mortgagee to any liability, civil
or criminal, for failure to pay such Imposition, and without constituting
or resulting in any violation of any Fee Mortgage affecting the Premises,
Tenant may delay payment thereof until the final determination resulting
from such contest or review of the amount or validity of such Imposition;
or
(b) If any charge or civil liability would be incurred by reason of any such
delay, Tenant nevertheless may contest as aforesaid and delay as aforesaid,
provided that such delay would not subject Landlord or any Fee Mortgagee to
criminal liability or fine, or any diminution in the value of the Premises,
Tenant prosecutes the contest with due diligence, and, if and to the extent
required by Landlord or any Fee Mortgagee, Tenant delivers to Landlord a
bond or other security in form and amount reasonably satisfactory to
Landlord to secure payment of such contested amount and any interest or
penalties thereon.
6.5 Joinder by Landlord. Landlord shall join in any proceedings referred to in
Section 6.4 (or permit the same to be brought in its name) if the provisions of
any applicable law, rule or regulation at the time in effect shall require that
such proceedings be brought by or in the name of Landlord or any owner of the
Premises, in which event Tenant shall reimburse Landlord upon demand for all
costs of Landlord incurred in connection therewith, including, without
limitation, attorneys fees. Provided that Landlord has approved the settlement
in question, and no Default has occurred and is then continuing, Tenant shall be
entitled to any refund of any Imposition and penalties or interest thereon
received by Landlord which have been paid by Tenant, or which have been paid by
Landlord but previously reimbursed in full by Tenant; provided that if a Default
has occurred and is then continuing, such refund shall be retained by Landlord
until and if Tenant cures said Default.
6.6 Appointment of Tenant as Landlord's Attorney-in-Fact. Landlord hereby
appoints Tenant the attorney-in-fact of Landlord, coupled with an interest, for
the purpose of making all payments to be made by Tenant pursuant to any of the
provisions of this Lease to persons or entities other than Landlord. In the
event any person or entity to whom any sum is directly payable by Tenant under
any of the provisions of this Lease shall refuse to accept payment of such sum
from Tenant, Tenant shall give written notice of such fact to Landlord and pay
such sum directly to Landlord at the address specified in Section 23.2 hereof,
whereupon Landlord shall promptly pay such sum in the same manner as provided in
Section 6.1 for proof by Tenant of payment of Impositions. Landlord may revoke
the rights granted to Tenant under this Section 6.6 at any time during the Term
upon thirty (30) days written notice to Tenant.
6.7 Funding of Fee Mortgage Reserve Requirements. Tenant shall pay or cause to
be paid all Fee Mortgage Reserve Requirements of Landlord that accrue during the
Term under any Fee Mortgage, as additional rent hereunder. Tenant shall pay such
Fee Mortgage Reserve Requirements to Landlord or, if Landlord so elects under
Section 5.2(b), to the Fee Mortgagee. Subject to the terms and conditions of the
Fee Mortgage, all Fee Mortgage Reserves shall be used by Landlord and Tenant
exclusively to pay (i) real estate tax bills covering the Premises, (ii)
property insurance premiums for insurance on the Premises maintained by Tenant
under Section 9.1 hereof, (iii) costs of repair and maintenance of the Premises
and improvements to the Premises by Tenant under Article 11 or Article 12
hereof, and (iv) mortgage insurance premium reserves required under the Initial
Fee Mortgage. Tenant has reviewed and accepts the terms of the Initial Fee
Mortgage related to reserves.
Upon the discharge of any Fee Mortgage, the outstanding
balance of any Fee Mortgage Reserves shall be applied first to fund any Fee
Mortgage Reserve Requirements under any successor Fee Mortgage, and provided no
Default by Tenant has occurred and is then continuing, the balance, to the
extent the same were actually paid by Tenant, and interest, if any, shall be
paid over to Tenant. Upon the Termination Date, Landlord shall pay to Tenant an
amount equal to the then outstanding balance of the Fee Mortgage Reserves, less
(i) the amount of any unpaid real estate taxes for any period prior to the
Termination Date (i.e., pro-rated through the Termination Date), (ii) the amount
of any unpaid property insurance premiums to maintain the property insurance
coverage required hereunder through the Termination Date, (iii) the amount of
any deferred maintenance and repair costs related to the Premises to satisfy
Tenant's repair obligations hereunder, (iv) any unpaid mortgage insurance
premium for any period through the Termination Date, (v) any unpaid reserve
amounts applicable during the period of Tenant's occupancy of the Premises, and
(vi) any outstanding obligations hereunder, plus (i) the amount of any Fee
Mortgage Reserves previously applied to the payment of real estate taxes for any
period after the Termination Date, (ii) the amount of any Fee Mortgage Reserves
previously applied to the payment of property insurance premiums for property
insurance coverage during any period after the Termination Date, and (iii)
overpayment of any mortgage insurance premium, and (iv) the amount remaining,
plus applicable interest, of the Initial Replacement Reserve.
ARTICLE 7.
Additional Covenants of Landlord
7.1 Certificate of Need. Landlord shall not independently transfer, convey or
encumber the certificate of need for the Facility ("CON") or any rights therein
or thereunder to any Person other than a Fee Mortgagee or a transferee of all or
substantially all of the Premises, and Landlord shall take all actions
reasonably necessary and appropriate to maintain the validity of the CON during
the Term. Each party shall provide the other with copies of all notices from,
and correspondence with, any State authorities regarding the CON, promptly after
receipt thereof.
7.2 Fee Mortgage. Landlord shall comply with the terms and provisions of each
Fee Mortgage and any Regulatory Agreement for Multifamily Housing Projects with
HUD to which Landlord is a party.
7.3 Cooperation. Landlord shall at all times cooperate, at Tenant's sole cost
and expense, in all reasonable respects and take all reasonable actions
necessary on its part to obtain and maintain in full force and effect all
waivers, licenses, permits and governmental approvals which may be necessary to
permit Tenant to lease the Premises and operate the Facility for the Permitted
Use; provided nothing herein shall require Landlord to take any action that
would materially increase Landlord's obligations or liabilities hereunder,
unless the same are fully assumed and paid by Tenant, or that would materially
decrease Landlord's rights hereunder, unless the same are fully compensated by
Tenant.
7.4 Notices. Landlord and Tenant shall promptly notify each other in writing of
any notice received by the other (oral or written) during the Term to the effect
that (i) all or any part of the Premises is in violation of any Applicable Law
or in violation of any covenant of any Permitted Encumbrance, (ii) there exists
any condition or event pertaining to the Premises, which after notice or lapse
of time, or both, would be held to so violate or give rise to any such
violation, (iii) there is any violation or alleged violation of any federal,
state, or local environmental laws, rules, standards or regulations, including,
with limitation, those related to waste-management, air pollution control,
waste-water treatment or noise abatement, or (iv) there are any substances or
conditions in or on the Premises which would support a claim or cause of action
under such environmental laws, rules, standards or regulations.
ARTICLE 8.
Compliance with Laws
8.1 Tenant's Compliance. During the Term, Tenant, at its sole cost and expense,
shall comply with all the laws, ordinances, orders, rules, regulations and
requirements of all federal, state and municipal governments which are
applicable to the Premises or to Tenant's Permitted Use of the Premises (the
"Applicable Laws"), and Tenant shall, at its sole cost and expense, make such
improvements or alterations to the Premises as may from time to time be required
during the Term by any Applicable Law. This undertaking shall not be deemed
breached by the existence of correctable violations disclosed upon licensure or
certification surveys by any federal, state or local governmental authority
provided that Tenant proceeds promptly to correct same upon notice or demand and
completion of such corrections occurs within a reasonable period of time
thereafter, but in no event later than six (6) months after such notice.
8.2 Right To Contest Applicable Laws. So long as no Default has occurred or is
continuing beyond any applicable cure period, Tenant shall have the right, upon
written notice to Landlord, to contest by appropriate legal proceedings
diligently conducted in good faith, in the name of Tenant or Landlord or both,
without cost or expense to Landlord, the validity or application of any
Applicable Laws, subject to the following:
(a) If by the terms of any such Applicable Laws, compliance therewith pending
the prosecution of any such proceeding may legally be delayed without the
incurrence of any lien, charge or liability of any kind against the
Premises or any part thereof or any material diminution in the value of the
Premises and without subjecting Tenant or Landlord or any Fee Mortgagee to
any liability, civil or criminal, for failure so to comply therewith and
without constituting or resulting in any violation of any Fee Mortgage
affecting the Premises, Tenant may delay compliance therewith until the
final determination of such proceeding; or
(b) If any charge or civil liability would be incurred by reason of any such
delay, Tenant nevertheless may contest as aforesaid and delay as aforesaid,
provided that such delay would not subject Landlord or any Fee Mortgagee to
criminal liability or fine, or any material diminution in the value of the
Premises, Tenant prosecutes the contest with due diligence, and, if and to
the extent required by Landlord or any Fee Mortgagee, Tenant delivers to
Landlord a bond or other security in form and amount reasonably
satisfactory to Landlord or any Fee Mortgagee to secure payment of any
contested amount and any interest or penalties thereon.
Landlord, without cost, expense or liability to it, shall, subject to the
foregoing, execute and deliver, in a timely manner, any appropriate papers which
may be necessary or proper to permit Tenant to contest the validity or
application of any such Applicable Laws.
ARTICLE 9.
Insurance and Indemnification
9.1 Building Insurance. Tenant shall obtain and maintain in force at all times
during the Term hereof, at its own cost and expense, a policy of standard form
fire insurance, together with an "all risk" endorsement and any other
endorsements which may be a condition of an all-risk endorsement, covering the
buildings and improvements on the Premises and all equipment and furnishings
included therein to the extent of the full replacement value thereof in amount
sufficient to prevent the Landlord or Tenant from being or becoming a co-insurer
within the terms of the policy in question, but in no event less than the
coverage requirements under any Fee Mortgage. Landlord shall reasonably
determine the amount of coverage required under this Section 9.1
9.2 Liability Insurance. Tenant shall obtain and maintain in force at all times
during the Term hereof, at its own cost and expense, a policy of commercial
general liability, including public liability and property damage, in an amount
of at least One Million Dollars ($1,000,000) for each person, Two Million
Dollars ($2,000,000) for each accident, and One Hundred Thousand Dollars
($100,000) for property damage, but in no event less than the reasonable
coverage requirements under any Fee Mortgage.
9.3 Professional Liability Insurance. Tenant shall obtain and maintain in force
at all times during the Term hereof, at its own cost and expense, a policy of
professional liability or "malpractice" insurance customarily issued in
connection with nursing home operations in an amount not less than One Million
Dollars ($1,000,000) per occurrence with excess coverage or "umbrella" insurance
of not less than Ten Million Dollars ($10,000,000), but in no event less than
the reasonable coverage requirements under any Fee Mortgage.
9.4 Rental Value Insurance. Tenant shall obtain and maintain in force at all
times during the Term hereof, at its own cost and expense, a policy of rental
value insurance against loss of income derived from the operation of the
Premises due to the risks referred to in Section 9.1 in an amount not less than
the Annual Base Rent for one Lease Year due hereunder. Tenant may, at its
election, carry such insurance as a coverage contained in a business
interruption insurance policy.
9.5 Coverage Changes; Other Insurance. Landlord shall have the right, upon
thirty (30) days prior written notice to Tenant, to require Tenant to increase
the amount(s) of any insurance coverage required under Article 9 hereof, and to
change the deductibles applicable thereto, such that the coverage amounts and
deductibles maintained by Tenant hereunder shall be substantially comparable to
the coverage amounts and deductibles usually maintained by companies engaged in
the same or a similar business in Ohio. Tenant shall obtain and maintain in
force at all times during the Term hereof, at its own cost and expense, such
other policies of insurance (and in such amounts) as may be reasonably required
by Landlord or under any Fee Mortgage, including, without limitation, workmen's
compensation insurance, automobile insurance, boiler insurance and flood
insurance, but in no event shall any policy be maintained in amounts lower than
required by the Fee Mortgagee.
9.6 Insurance Criteria. Insurance policies required by this Lease shall be
subject to the applicable terms and conditions of the Fee Mortgage and to the
extent not prohibited by the Fee Mortgage shall:
(a) be issued by insurance companies of recognized responsibility (except that
Tenant shall have the right to self insure or maintain coverage through a
captive insurer in accordance with Section 9.6(e) below);
(b) name the Landlord, the Fee Mortgagee, and other persons or entities
reasonably designated by Landlord or Tenant, as the case may be, as
additional insureds as their interests may appear; other landlords or
tenants may also be added as additional insureds in a blanket policy;
(c) provide that the insurance not be canceled or materially reduced in the
scope or amount of coverage unless thirty (30) days or more advance notice
is given to the Landlord and Fee Mortgagee, provided that if
notwithstanding Tenant's best efforts, Tenant is unable to obtain such
commitment from the insurer, then Tenant shall assume the obligation to
notify Landlord and Fee Mortgage at least thirty (30) days prior to any
cancellation or material reduction in the scope or amount of coverage;
(d) be primary policies not as contributing with, or in excess of, the coverage
that the other party may carry;
(e) be permitted to be carried through one or more of the following:
(i) a "blanket policy";
(ii) "umbrella" coverage;
(iii)self insurance by Tenant or an affiliate of Tenant, the financial
capability and other terms of which are approved by Landlord, in its
sole and absolute discretion; or
(iv) captive insurance program through a captive insurance company in which
Tenant participates, if the financial condition loss experience and
other terms of which are approved by Landlord, in its sole and
absolute discretion.
(f) expressly waive any right of subrogation on the part of the insurer against
Landlord, Fee Mortgagee, or Tenant.
9.7 Evidence of Insurance. Upon request of the Landlord or Fee Mortgagee, Tenant
shall promptly give certificates of insurance to the Landlord and Fee Mortgagee
evidencing the insurance coverage required to be maintained by Tenant under this
Article 9. In addition, evidence of renewal of each insurance policy required to
be maintained by Tenant hereunder shall, upon Landlord's request, be delivered
to Landlord not less than thirty (30) days prior to expiration of such policy.
9.8 Waiver of Subrogation. It is agreed that neither Tenant (or any of its
assignees or sublessees from time to time) nor Landlord shall be liable for any
loss or damage to each other's property to the extent that such loss or damage
is covered by insurance carried by either party. This agreement shall constitute
the parties' respective waivers for all insurance policies which contain
provisions to the effect that to the extent the insured may have waived by
express agreement prior to any loss any right of recovery from others for loss
to the property described in any policy or extended coverage endorsement
thereon, then the insurance company or companies waive their right of recovery
under the subrogation clauses in the insurance policies. Each party hereby
waives for itself and on behalf of its insurer the right to recover any loss or
damage covered by insurance carried by either party.
9.9 Indemnification.
(a) To the extent the insurance coverage maintained by Tenant hereunder is not
available in whole or in part to pay the same, Tenant agrees to defend,
protect, indemnify and save harmless Landlord, its successors, assigns,
partners, shareholders, directors and officers from and against all
liability to third parties (including but not limited to the officers,
agents, contractors, and business associates of Tenant) with counsel
acceptable to Landlord arising from (i) Tenant's use and occupancy of the
Premises (other than liability arising from Landlord's failure to perform
or observe any covenant or condition required to be performed or observed
by Landlord under this Lease or any gross negligence or intentional
misconduct on the part of Landlord or Landlord's servants, agents,
employees, contractors, suppliers, workers or invitees), (ii) the
negligence or intentional willful misconduct of Tenant and its servants,
agents, employees, contractors, suppliers, workers and invitees, or (iii)
Tenant's failure to perform or observe in any material respect any covenant
or condition required to be performed or observed by Tenant under this
Lease.
(b) To the extent the insurance coverage maintained by Tenant hereunder is not
available in whole or in part to pay the same, Landlord agrees to defend,
protect, indemnify and save harmless Tenant, its successors, assigns,
partners, shareholders, directors and officers from and against all
liability to third parties (including but not limited to the officers,
agents and contractors of Landlord) arising from (i) the gross negligence
or intentional willful misconduct of Landlord or Landlord's servants,
agents, employees, contractors, suppliers, workers or invitees acting
within the scope of their respective authority, or (ii) Landlord's failure
to perform or observe in any material respect any covenant or condition
required to be performed or observed by Landlord under this Lease.
(c) If any claim is asserted or any action is commenced against a party
(the "Indemnified Party") in respect of which such Indemnified Party
is entitled to seek indemnification hereunder, such Indemnified Party
shall give prompt notice to the other party (the "Indemnifying
Party"). Such Indemnifying Party shall have the right, with counsel
approved by such Indemnified Party (not to be unreasonably withheld),
to assume the defense of such claim or action, provided that if
counsel is selected by the Indemnifying Party, no settlement of such
claim or action shall be entered into without the written consent of
the Indemnified Party or a full written release of the Indemnified
Party. If the Indemnifying Party shall so assume such defense then it
shall not be responsible for the fees of any separate counsel retained
by the Indemnified Party.
ARTICLE 10.
Utilities
10.1 Utilities. Tenant shall pay or cause to be paid all charges (including,
without limitation, all deposits and connection charges) for water, gas, sewer,
electricity, light, heat, air conditioning, power, telephone, and other services
used by or rendered or supplied to Tenant in connection with the Premises and
shall contract for the same in Tenant's own name.
10.2 Landlord's Services and Repairs. Landlord shall not be required to furnish
to Tenant any facilities or services of any kind whatsoever during the Term,
including but without limitation, water, steam, heat, gas, hot water,
electricity, light and power. Landlord shall have no obligation to make any
alterations, rebuildings, replacements, changes, additions, improvements or
repairs to the Premises during the Term.
ARTICLE 11.
Control and Repairs
11.1 Possession and Control. Tenant shall have exclusive possession and control
of, and responsibility for, the Premises during the Term upon the terms and
conditions of this Lease.
11.2 Tenant's Repair Obligations. Subject to Section 12.1, Tenant, at its sole
cost and expense, shall keep the Improvements neat and clean, in good repair,
order and condition, and shall make all repairs thereto, interior and exterior,
structural and non-structural, ordinary and extraordinary, foreseen and
unforeseen, as are necessary to keep the Improvements in substantially the same
condition as the Improvements are in on the Lease Commencement Date (reasonable
wear and tear excepted). When used in this Article 11, the term "repairs" shall
include all necessary replacement and renewals, including, but not limited to
roof replacement, structural work, parking lot repair and replacement, heating,
ventilation and air conditioning systems, plumbing and electrical systems, and
any surface or subsurface work. All repairs to the Improvements made by Tenant
shall be at least equal in quality and class to the original work. Tenant shall
not permit or commit any waste to the Improvements, reasonable wear and tear
excepted. Additionally, Tenant, at its sole cost and expense, shall make all
repairs, alterations and modifications of any kind and nature that are necessary
to comply with Applicable Laws and insurance requirements so that the Facility
can be operated legally for the Permitted Use.
11.3 Applicable Standard for Repairs. The necessity for and adequacy of repairs
to the Improvements pursuant to Section 11.2 or to the equipment, furniture and
fixtures, pursuant to the Section 11.4 shall be measured by the standard which
is appropriate for Improvements of similar construction, use and class or by the
standard which is appropriate for personal property of similar make, use and
class, but, in any event, shall meet the standards established or imposed by any
governmental authority having jurisdiction over the Premises or the business
conducted thereat.
11.4 Equipment, Furniture and Fixtures. Tenant shall install and place on the
Premises, free of any liens except as permitted hereunder, such fixtures,
furnishings, furniture and equipment as Tenant deems reasonably necessary or
convenient from time to time for the Permitted Use of the Premises; provided,
however, that the costs and expenses therefor are paid for by Tenant. Any
equipment, furniture and fixtures (whether located on the Premises on the Lease
Commencement Date or added thereto or substituted therefor at a later date)
(other than equipment leased by Tenant from third parties) shall be and remain
the property of Landlord. Upon the expiration of the Term of this Lease, unless
Tenant or its assignee shall have acquired the Premises, Tenant shall redeem or
retire all outstanding leases of any equipment, furniture and fixtures so that
all such equipment, furniture and fixtures shall become the property of
Landlord. Tenant agrees upon request of Landlord to execute and to deliver to
Landlord at any time and from time to time during the Term of this Lease
documentation evidencing Landlord's ownership of the equipment, furniture and
fixtures located on the Premises.
ARTICLE 12.
Alterations and Additions
12.1 Alterations and Additions to the Improvements. Subject to the terms of the
Fee Mortgage, Tenant may make any changes or alterations in or to the
Improvements, and may erect and build any and all additions to the Improvements
or erect any new Improvements upon the Land which it desires, provided:
(i) Any such change, alteration, addition or replacement, the estimated
cost of which shall exceed the Threshold Amount, shall not be
commenced without, as a condition precedent, Tenant obtaining written
approval from Landlord (which approval shall not be unreasonably
withheld or delayed and shall specify if Tenant is required to remove
such improvement at the end of the Term) and, if required, by the Fee
Mortgagee, after Tenant has furnished to Landlord and, if required,
the Fee Mortgagee, plans and specifications for such improvement,
repair, addition or replacement;
(ii) Tenant shall have procured and paid for, so far as the same may be
required from time to time, all permits and authorizations of all
municipal departments and governmental subdivisions having
jurisdiction;
(iii)Any change or alteration or addition or replacement, the estimated
cost of which shall exceed the Threshold Amount shall be conducted
under the supervision of an architect or engineer selected by Tenant
and approved in writing by Landlord (which approval shall not be
unreasonably withheld or delayed) and, if required, by the Fee
Mortgagee, and no such change or alteration shall be made except in
accordance with detailed plans and specifications and cost estimates
prepared and approved in writing by such architect or engineer;
(iv) The change or alteration shall, when completed, be of such a character
as not to reduce the value of the Improvements below their value
immediately before such change or alteration, and such change or
alteration shall be consistent with the quality and appearances of the
Premises;
(v) General liability insurance and workmen's compensation insurance for
the mutual benefit of Tenant and Landlord against claims for bodily
injury, death or property damage in the sums as specified and provided
for in Article 9 of this Lease shall be in place before work is
commenced and maintained by Tenant at Tenant's sole cost and expense
at all times when any work is in process in connection with any change
or alteration;
(vi) In making any change or alteration, as in this Article provided,
Tenant agrees that:
(A) Tenant will at all times fully comply and continue to comply with the
foregoing conditions;
(B) Any such change or alteration shall be made in good and workmanlike manner
and in compliance with all applicable permits and other laws, ordinances,
orders, rules, regulations and requirements of all federal, state, and
municipal governments, department, commissions, board and officers, and in
accordance with the orders, rules and regulations of the National Board of
Fire Underwriters, the local Board of Fire Underwriters or any other body
or bodies hereafter exercising similar functions; and
(C) The cost of any such change or alteration, including but not limited to all
insurance premiums, labor and material, shall be paid by Tenant so that the
Premises shall at all times be free of liens for labor and materials
supplied or claimed to have been supplied to the Premises or for any other
item or matter in connection with the making of said alteration or repair.
Upon request of Tenant, but at Tenant's sole cost and expense, Landlord
shall join in Tenant's application for any building permit or license required
in connection with such alteration and/or addition to the Improvements and,
subject to the prior written consent of the Fee Mortgagee, if required, shall
grant such utility easements as may be required in connection therewith;
provided nothing herein shall require Landlord to take any action that would
materially increase Landlord's obligations and liabilities hereunder, unless the
same are fully assumed and paid by Tenant, or that would materially decrease
Landlord's rights hereunder, unless the same are fully compensated by Tenant.
ARTICLE 13.
Landlord's Right to Perform Tenant's Covenants.
13.1 Landlord's Right to Perform. If Tenant shall at any time fail to pay any
Imposition in accordance with the provisions of Section 6.1 or to take out, pay
for, maintain or deliver any of the insurance policies or certificates therefor
as provided for in Article 9, or shall fail to make any other payment or perform
any other act on its part to be made or performed, or shall fail to make
necessary repairs in accordance with the provisions of Section 11.2, Landlord,
after providing Tenant with the notice required pursuant to Section 23.2 of this
Lease, and without waiving or releasing Tenant from any obligation of Tenant
contained in this Lease or from any Default by Tenant and without waiving
Landlord's right to take such action as may be permissible under this Lease as a
result of such Default, may (but shall be under no obligation to):
(a) pay any Imposition payable by Tenant pursuant to the provisions of Section
6.1 or
(b) take out, pay for and maintain any of the insurance policies provided for
in Article 9, or
(c) make any other payment or perform any other act on Tenant's part to be made
or performed as in this Lease provided, and, upon giving Tenant at least 24
hours advance notice (except in any emergency), may enter upon the Premises
for any such purpose, and take all such action thereon, as may be necessary
therefor, causing the least practical interference with Tenant's business.
In furtherance of Landlord's right to perform Tenant's covenants hereunder,
Tenant hereby grants to Landlord an exclusive power of attorney and appoints
Landlord its exclusive true and lawful attorney in fact, coupled with an
interest, to take each of the actions specified in subsections (a) through (c)
above for and on behalf of and in the name of Tenant throughout the Term of this
Lease and thereafter as necessary.
13.2 Reimbursement By Tenant. All costs and expenses actually paid by Landlord
pursuant to Section 13.1 hereof, including, without limitation, reasonable
attorney's fees and expenses, and court costs, together with interest thereon at
the Reference Rate from the date of the payment thereof by Landlord, shall be
paid by Tenant to Landlord not later than ten (10) days after written demand
therefor by Landlord to Tenant.
ARTICLE 14.
Damage and Destruction of the Premises.
14.1 Cancellation Due To Casualty. Notwithstanding anything in this Lease to the
contrary, subject to the terms of the Fee Mortgage, if, at any time during the
Term, the Facility shall be destroyed or damaged by fire or any other cause, and
if the Facility, in the reasonable judgment of Tenant, could not be
substantially restored or repaired and ready for full occupancy within two
hundred seventy (270) days of the event, Tenant shall have the right,
exercisable within sixty (60) days of such event, to terminate this Lease by
written notice to Landlord. Tenant shall notify Landlord in writing of its
determination of the feasibility of restoring or repairing the Facility within
thirty (30) days of such event. In the event Tenant elects to terminate this
Lease pursuant to this Section 14, this Lease and the Term shall cease and
expire as of the date of such damage or destruction (the "Revised Expiration
Date") with the same force and effect as if the Revised Expiration Date were the
date originally set forth in this Lease for the expiration of the Term except
that Tenant shall have no obligation to repair, replace or rebuild any
buildings, structures, improvements or equipment, and the proceeds of all
insurance shall be paid to and belong to Landlord, subject to the rights of the
holder of any Fee Mortgage.
14.2 Damage. If, during the Term, the buildings, improvements or the equipment
on, in or appurtenant to the Premises on the Lease Commencement Date, or
thereafter erected or installed thereon or therein, shall be destroyed or
damaged in whole or in part by fire or other cause, and Tenant does not
terminate this Lease pursuant to Section 14.1, Tenant shall, except as otherwise
hereinafter provided, use the Net Insurance Proceeds to promptly repair, replace
and rebuild the same with buildings, structures, improvements and equipment of
equal or better character, quality and condition than existed immediately prior
to such occurrence. Tenant's obligation to repair, replace or rebuild shall be
limited to the amount of the Net Insurance Proceeds made available to Tenant
plus the amount of any deductible under such insurance, and any other funds that
Landlord may (but shall not be obligated to) contribute for such purpose.
14.3 Insurance Proceeds. To the extent permitted under the Fee Mortgage, in the
event of a loss in excess of the Threshold Amount, the proceeds of any insurance
applicable to the particular casualty (net of any deductible), less any cost and
expense incurred in adjusting or collecting such proceeds (hereinafter sometimes
referred to as the "Net Insurance Proceeds") shall be deposited in an interest
bearing account with a bank or trust company having a capital and surplus of at
least $500,000,000, in trust, and such party (hereinafter referred to as the
"Trustee") shall make available such Net Insurance Proceeds upon the terms and
conditions hereinafter set forth. The Net Insurance Proceeds shall be disbursed
from time to time at the request of and at the direction of Tenant and upon the
reasonable approval of Landlord after approval of any work, to the parties whom
Tenant may employ to perform the restoration work, as same shall progress, or to
Tenant, if Tenant shall make or pay for the cost of any restoration work, in
reimbursement for the fair value of the work and materials actually incorporated
in the Premises. Such payments shall be made by such Trustee from time to time,
upon the written request of Tenant, by a duly authorized officer of Tenant,
which shall be accompanied by a certificate, addressed to the Trustee, and to
Landlord and to the holder of any Fee Mortgage, of the architect or engineer in
charge of the restoration work, setting forth that the amount then requested to
be withdrawn either has been paid by Tenant or is properly due to contractors,
subcontractors, materialmen, engineers, architects, or other persons who have
rendered services or furnished materials in connection with such restoration
work. In the event of a loss equal to or less than the Threshold Amount, the Net
Insurance Proceeds relating thereto shall be assigned or paid directly to
Tenant, to be applied by Tenant in accordance with the provisions of this
Section 14.
ARTICLE 15.
Condemnation
15.1 Cancellation Due to Event of a Taking. Upon the taking of all of the
Premises or any part thereof which materially and adversely affects the
operation of the Facility or results in a decrease in the number of nursing home
beds that Tenant may legally operate at the Facility in or by condemnation or
other eminent domain proceedings (or by conveyance in lieu thereof), this Lease
and the Term shall terminate and expire on the date of vesting of title in such
taking (which date is hereinafter referred to as the "Date of Taking"), in which
case the obligations and liabilities of Tenant under this Lease which have
accrued on or prior to the Date of Taking, and the Base Rent provided in this
Lease to be paid by Tenant shall be apportioned and paid by Tenant through the
Date of Taking. Upon the taking of less than substantially all of the Premises
in or by condemnation or other eminent domain proceedings (or by conveyance in
lieu thereof), Tenant shall have the right to terminate this Lease by notice to
Landlord if Tenant determines in its reasonable business judgment that such
taking materially interferes with Tenant's ability to continue its business
operations at the Premises in substantially the same manner as immediately prior
to the taking, in which case all rights and obligations of Tenant hereunder
shall expire and terminate other than obligations and liabilities of Tenant
under this Lease which have accrued on or prior to the Date of Taking, and the
Base Rent provided in this Lease to be paid by Tenant shall be apportioned and
paid by Tenant through the Date of Taking.
15.2 Award. Subject to Section 15.3 below, if at any time while Landlord is the
fee owner of the Premises the whole or any part of the Premises shall be taken
for any public or quasi-public purpose by any lawful power or authority by the
exercise of the right of condemnation or eminent domain (or by conveyance in
lieu thereof), Landlord shall be entitled to and shall receive any and all
awards and payments that may be made in any such proceeding. Any award of
payment that may be made in any such proceeding, after deducting the reasonable
cost and expense incurred in connection with the establishment and collection of
such award or payment, is herein called the "Net Award". Notwithstanding
anything else in this Section, Tenant may claim and recover from the condemning
authority a separate award for Tenant's moving expenses, business dislocation
damages, the unamortized costs of leasehold improvements (that are not
replacements of Facility improvements existing on the Lease Commencement Date)
paid for by Tenant, and any other award that would not reduce the award payable
to Landlord. Each party shall seek its own award, as limited by this Section, at
its own expense, and neither shall have any right to the award made to the
other.
15.3 Restoration. If a portion of the Premises shall be taken in or by
condemnation or other eminent domain proceedings (or by conveyance in lieu
thereof), and this Lease shall not be terminated in accordance with the
provisions of Section 15.1, Tenant shall after any such partial taking, use the
Net Award to promptly and diligently commence and complete the restoration work
for the Premises as nearly as practicable to the condition which existed prior
to such partial taking. In the event the Net Award is in excess of the Threshold
Amount, the Net Award shall be deposited in an interest bearing account in trust
with the Trustee, and the Trustee shall make available such Net Award upon the
same terms and conditions as set forth in Section 14 substituting "Net Award"
for "Net Insurance Proceeds" as used therein. Tenant's obligation to undertake
any restoration work shall be limited to the amount of the Net Award made
available to Tenant and any other funds that Landlord may (but shall not be
obligated to) contribute for such purpose.
ARTICLE 16.
Assignment and Subletting
16.1 Assignments, etc. Except as otherwise permitted under Section 16.2 or
Section 16.3 hereof, and subject to the terms of any Fee Mortgage and the
Regulatory Agreement between HUD and Tenant, Tenant shall not assign this Lease
or any of Tenant's interest hereunder, or sublease any portion of the Premises,
without the prior written consent of the Landlord which consent shall be in
Landlord's sole and absolute discretion. For purposes hereof, the transfer of
any direct or indirect interest in Tenant shall constitute an assignment of this
Lease.
16.2 Partial Subleases. Tenant shall have the right to sublease any part (but
not all) of the Premises to any Permitted Assignee for any use which is a
Permitted Use, provided that (i) such sublease and the rights of the sublessee
thereunder shall be expressly made subject to and subordinate at all times to
this Lease and to any Fee Mortgage now or hereafter existing, and to all
amendments, modifications, renewals, extensions, consolidations and replacements
of this Lease and each Fee Mortgage; (ii) the term of any such sublease shall
not extend beyond the Term; and (iii) Tenant shall furnish Landlord with a copy
of such sublease not less than ten (10) days prior to entering into such
sublease. No such sublease shall affect Tenant's obligations under this Lease.
In the event this Lease shall terminate prior to the expiration of such
sublease, the sublessee shall, at Landlord's option, attorn to Landlord and
waive any right sublessee may have to terminate the sublease or surrender the
Premises.
16.3 Assignment to Permitted Assignees. As long as no Default has occurred and
is then continuing beyond any applicable grace period, Tenant shall have the
right to assign all or any part of Tenant's right, title and interest as lessee
under this Lease to any Permitted Assignee. Nothing herein shall prohibit or
limit Tenant's right or authority to assign, pledge, hypothecate or otherwise
transfer any accounts or accounts receivable of Tenant resulting from the
operation of the Facility. Any assignment of this Lease shall be by an
instrument in writing and shall be executed by the assignor and the assignee, in
each instance, as the case may be. Each such transferee or assignee shall agree
in writing for the benefit of Landlord to assume, to be bound by, and to perform
the terms, covenants and conditions of this Lease to be done, kept and performed
by Tenant. So long as the Fee Mortgagee is insured by HUD, Tenant shall not make
any Assignment of this Lease without any required prior written consent of the
FHA Commissioner.
ARTICLE 17.
Fee Mortgages
17.1 Fee Mortgages. As of the Lease Commencement, the Premises will be
encumbered with a fee mortgage as more particularly described on the Schedule of
Permitted Encumbrances attached hereto as Exhibit B (as the same may be
hereafter amended, modified, renewed, extended, consolidated or replaced,
hereinafter referred to as the "Initial Fee Mortgage"). The Initial Fee Mortgage
and any other mortgage or other security device permitted hereunder which
encumbers all or any part of the Landlord's interest in the Premises is herein
called a "Fee Mortgage" and the holder of any such mortgage or other security
device is herein called a "Fee Mortgagee".
17.2 Subordination. Subject to the provisions of Section 17.3:
(a) Tenant, for itself and its successors and assigns, agrees that this Lease
and the rights of Tenant hereunder shall be and are hereby expressly made
subject to and subordinate at all times to each Fee Mortgage now or
hereafter existing (including without limitation the Initial Fee Mortgage
and the rights of the FHA Commissioner under that certain HUD Regulatory
Agreement described in Exhibit B) and to all amendments, modifications,
renewals, extensions, consolidations and replacements of each of the
foregoing, and to all advances made or hereafter to be made upon the
security thereof; and
(b) such subordination shall be automatic and shall require no further action
by Landlord or Tenant for its effectiveness.
17.3 Nondisturbance. Notwithstanding the provisions of Sections 17.1 and 17.2,
this Lease and the rights of Tenant hereunder shall not be subordinate to any
Fee Mortgage, other than the Initial Fee Mortgage or any other HUD-insured Fee
Mortgage, unless the Fee Mortgagee shall execute and deliver to Tenant a
nondisturbance agreement substantially in the form of Exhibit C or such other
form which is reasonable acceptable to Tenant (a "Qualifying Non-Disturbance
Agreement"). Tenant agrees to execute and return any Qualifying Non-Disturbance
Agreement within twenty (20) days of its receipt thereof.
17.4 Subordination of Fee Mortgagee. Notwithstanding anything to the contrary
contained herein, any Fee Mortgagee may subordinate its Fee Mortgage to this
Lease by sending Tenant notice in writing subordinating such Fee Mortgage to
this Lease, and Tenant agrees to execute and deliver to such Fee Mortgagee an
instrument consenting to or confirming the subordination of such Fee Mortgage to
this Lease within twenty (20) days of its receipt of such notice.
17.5 Payments By Tenant on Behalf of Landlord. Except as provided otherwise in
Section 5.2(b) above, Landlord hereby covenants to pay all amounts due under
each Fee Mortgage when and as due and to keep same current at all times. If
there shall be a default by Landlord in the payment of any amount due under any
Fee Mortgage, Tenant shall have the right to pay the amount so in default, and
the reasonable costs and expense, if any, of any foreclosure action or other
suit or proceeding instituted by the Fee Mortgagee upon such default, and upon
making such payment Tenant shall be entitled to full reimbursement thereof from
Landlord upon demand, and, in addition to other remedies, be entitled to offset
and deduct the amount so paid, together with interest thereon at the Reference
Rate from the date of the payment thereof by Tenant, from any rent then due, or
thereafter falling due, under this Lease or any of the Other Leases until the
amount of such payment shall have been repaid therefrom by Landlord to Tenant.
ARTICLE 18.
Default
18.1 Default by Tenant. If (a) Tenant defaults in the payment of rent or in the
payment of any sum due under this Lease, and such default shall continue for
five (5) days after notice thereof in writing by Landlord to Tenant, or (b) if
Tenant defaults in the prompt and full performance of any covenant, condition,
agreement or provision of this Lease (including, without limitation, Tenant's
compliance obligations under Section 3.1(c) hereof and Tenant's payment
obligations under Section 5.2(b) hereof to the extent Landlord has exercised its
right to require Tenant to pay any Fee Mortgage Obligations then due and payable
directly to the Fee Mortgagee) and such default shall continue for thirty (30)
days after notice thereof in writing by Landlord to Tenant, provided, however,
that in the case of a default which cannot with reasonable diligence be cured
within said period of thirty (30) days after the notice, Tenant shall have such
additional time to cure the same as may reasonably be necessary (provided Tenant
is proceeding with reasonable diligence to cure the same), or (c) if Tenant
shall abandon the Premises for any period of thirty (30) consecutive days during
the Term of this Lease, or (d) if Tenant shall cease to operate the Premises for
the Permitted Use for a period of thirty (30) consecutive days (other than as a
result of a casualty or taking), or (e) if Tenant shall file a voluntary
petition in bankruptcy or shall be adjudicated a bankrupt in any bankruptcy or
insolvency proceedings and such petition or adjudication shall not be vacated or
stayed within sixty (60) days, or (f) if any court shall enter an order,
judgment or decree appointing a receiver or trustee for Tenant or any of
Tenant's property in a bankruptcy or other proceeding, and such order, judgment
or decree shall remain in force, undischarged or unstayed, for sixty (60) days
after it is entered, or (g) if any representation, warranty or statement
contained herein proves to be untrue in any material respect as of the date when
made or at any time if such representation or warranty is a continuing
representation or warranty, or (h) if either the state license to operate the
Facility as a nursing home or the certification of the Facility to participate
in the Medicare and Medicaid programs is revoked or terminated, or (i) if Tenant
is in Default under any of the Other Leases, then in any such event of default
(hereinafter a "Default") as herein described, Landlord may, at its option at
any time during the continuation of such Default:
(A) give written notice to Tenant stating that this Lease is at an end, and
thereafter, re-enter, repossess and enjoy the Premises together with all
additions, alterations and improvements thereto, subject to any notice or
waiting period and/or governmental approval process established or required
under applicable federal or state licensure and/or certification
regulations pertaining to a change of licensee or ownership of the Facility
and in any event in a manner which ensures the safe transfer of care of the
patients resident in the Facility, in which case Tenant shall be liable to
Landlord for all rent accrued to the date of such termination of this Lease
and any expenses actually incurred by Landlord, including attorneys fees,
as a result of Tenant's Default hereunder; or
(B) re-enter the Premises and without terminating this Lease, relet the
Premises or any part or parts thereof (subject to any notice or waiting
period and/or governmental approval process established or required under
applicable federal or state licensure and/or certification regulations
pertaining to a change of licensee or ownership of the Facility and in any
event in a manner which ensures the safe transfer of care of the patients
resident in the Facility) on such terms and conditions as Landlord may
determine for the account of Tenant, and receive and collect the rents or
revenues therefrom, applying the same, first, (x) to any costs and expenses
actually incurred by Landlord (including, without limitation, attorneys'
fees and expenses) as a result of Tenant's Default, (y) to any costs and
expenses actually incurred by Landlord in connection with reletting the
Premises (including, without limitation, brokerage commissions, tenant
improvement costs and other capital expenditures), and (z) to any costs and
expenses actually incurred by Landlord in connection with operating and
maintaining the Premises (including, without limitation, capital
expenditures and any Fee Mortgage Reserves), and, second, to the
fulfillment of the rental obligations of Tenant under this Lease. Tenant
shall remain obligated to Landlord until the end of the Initial Term (if
the Default occurs during the Initial Term) or the end of the Extension
Term then in effect (if the Default occurs during an Extension Term) for
all rent and other charges required to be paid by Tenant under the terms of
this Lease, reduced by rents or revenues received by Landlord from any
reletting during the Term (less all costs and expenses described in the
immediately preceding sentence); or
(C) at the option of Landlord exercised at any time, recover from Tenant, as
liquidated damages, in addition to any other proper claims but in lieu of
and not in addition to any amount which would thereafter have become
payable by Tenant under the preceding clause (B), an amount equal to the
sum of (x) all Annual Base Rent that is due and unpaid at the later to
occur of termination, repossession or eviction, together with interest
thereon at the Reference Rate, plus (y) the present value (calculated in
the manner stated below) of the amount by which the unpaid Annual Base Rent
for the balance of the Term after the later to occur of termination,
repossession or eviction exceeds the fair market rental value (taking into
account brokerage commissions and other costs and expenses of reletting the
Premises) of the Premises for the balance of the Term, plus (z) any other
amount necessary to compensate Landlord for all damages proximately caused
by Tenant's failure to perform its obligations and covenants under this
Lease (including, without limitation, the costs and expenses of operating
and maintaining the Premises, including, without limitation, capital
expenditures and any Fee Mortgage Reserves); the determination of the
"present value" of unpaid Annual Base Rent to be based upon a discount rate
of ten percent (10%) per year to present worth; it being understood by the
parties hereto that Landlord's damages upon a Tenant Default would not be
subject to accurate calculation and the amount established hereby as
liquidated damages is a reasonable estimate of the damages, but not a
penalty, which would be incurred by Landlord.
Anything contained herein to the contrary notwithstanding, if
any termination of this Lease shall be stayed by an order of any court having
jurisdiction over any proceeding described in Section 18.1(e) or (f) hereof, or
by federal or state statute, then, following the expiration of any such stay, or
if the trustee appointed in any such proceeding, Tenant or Tenant as
debtor-in-possession shall fail to assume Tenant's obligation under this Lease
within the period prescribed therefor by law or within one hundred twenty (120)
days after entry of the order for relief or as may be allowed by the court, or
if said trustee, Tenant or Tenant as debtor-in-possession shall fail to provide
adequate protection of Landlord's right, title and interest in and to the
Premises or adequate assurance of the complete and continuous future performance
of Tenant's obligations under this Lease, Landlord, to the extent permitted by
law or by leave of the court having jurisdiction over such proceeding, shall
have the right, at its election, to terminate this Lease on five (5) days'
notice to Tenant, Tenant as debtor-in-possession or said trustee and upon the
expiration of said five (5) day period this Lease shall cease and expire as
aforesaid and Tenant, Tenant as debtor-in-possession or said trustee shall
immediately quit and surrender the Premises as aforesaid and be liable to
Landlord as provided above upon a termination of this Lease.
18.2 Cancellation of Lease by FHA Commissioner. Notwithstanding anything to the
contrary herein set forth, this Lease may be cancelled upon thirty (30) days
prior written notice by the FHA Commissioner given to Landlord and Tenant for a
violation by Tenant of any of the provisions set forth in the Regulatory
Agreement executed by Tenant dated as of September 26, 2000; provided that
Termination of the Lease on such grounds shall be deemed to be a Default by
Tenant hereunder, and Landlord shall have all the rights accorded to Landlord
upon a Default by Tenant under Section 18.1 hereof. Nothing contained in this
Lease shall be deemed to grant Tenant more than thirty (30) days to cure any
violation upon which the FHA Commissioner has given notice to the Tenant.
18.3 Tenant Bankruptcy Provisions
(A) If a default occurs under Section 18.1(e) or (f) hereof and Tenant assumes
this Lease and proposes to assign the same pursuant to the provisions of
the Bankruptcy Code to any Person who shall have made a bona fide offer to
accept an assignment of this Lease on terms acceptable to Tenant, then, in
such event, notice of such proposed assignment (an "Assignment Notice")
shall be given to Landlord by Tenant no later than twenty (20) days after
receipt by Tenant, but in any event no later than (10) days prior to the
date that Tenant shall make application to a court of competent
jurisdiction for authority and approval to enter into such assignment and
assumption. Such Assignment Notice shall set forth (a) the name and address
of such Person, (b) all of the terms and conditions of such offer, and (c)
adequate assurance of future performance by such Person under the Lease as
set forth in paragraph (B) below, including, without limitation, the
assurance referred to in Section 365(b)(3) of the Bankruptcy Code. Landlord
shall have the prior right and option, to be exercised by written notice to
Tenant given with ten (10) days of Landlord's receipt of the Assignment
Notice, to accept an assignment of this Lease upon the same terms and
conditions and for the same consideration, if any, as the bona fide offer
made by such Person, less any brokerage commissions which would otherwise
be payable by Tenant out of the consideration to be paid by such Person in
connection with the assignment of this Lease. For purposes of this Lease,
"Bankruptcy Code" shall mean 11 U.S.C. ss. 101 et. seq., as amended from
time to time.
(B) The term "adequate assurance of further performance" as used in this Lease
shall mean that any proposed assignee shall, among other things: (a) agree
to cure all material defaults under this Lease; (b) furnish Landlord with
financial statements of such assignee for the prior three (3) fiscal years,
as finally determined after an audit by a certified public accountant,
which financial statements shall show a net worth of such assignee
reasonably necessary for the assignee to fully perform this Lease and, to
the extent they are to be assigned to the proposed assignee, the Other
Leases for each of such three (3) years, all as reasonably determined by
Landlord, provided, however, that such net worth shall not be required to
exceed four times (4x) the then Annual Base Rent under this Lease and, to
the extent they are to be assigned to the proposed assignee, the Other
Leases for each of such three (3) years; (c) grant to Landlord a security
interest in such tangible property of the proposed assignee located at the
Premises as Landlord shall reasonably deem necessary to secure such
assignee's future performance under this Lease; and (d) provide such other
information or take such action as Landlord, in its reasonable judgment
shall determine is necessary to provide adequate assurance of the
performance by such assignee of its obligations under this Lease.
ARTICLE 19.
Quiet Enjoyment
19.1 Quiet Enjoyment. Upon payment of the Annual Base Rent and all other charges
herein provided for, and provided Tenant complies with the terms of this Lease
and performs its obligations hereunder, Tenant shall quietly have and enjoy the
Premises during the Term without hindrance or interruption by Landlord or by
anyone claiming by, through or under Landlord subject, however, to the terms and
conditions of this Lease.
ARTICLE 20.
Estoppel Certificates
20.1 Tenant's Certificate. Tenant shall, without charge, at any time and from
time to time, within fifteen (15) days after request by Landlord, certify by
written instrument, duly executed, acknowledged and delivered, to Landlord, or
any other person, firm or corporation specified by Landlord in substantially the
form as Exhibit E annexed hereto and made a part hereof.
20.2 Landlord's Certificate. Landlord shall, without charge, at any time and
from time to time, but in no event more than three (3) times in any calendar
year, within fifteen (15) business days after request by Tenant certify by
written instrument, duly executed, acknowledged and delivered, to the effect
that this Lease is unmodified and in full force and effect (or if there shall
have been modifications that the same is in full force and effect as unmodified
and stating the modifications) and the dates to which the Annual Base Rent and
other charges have been paid, the date of expiration of the current Term, the
Annual Base Rent then payable under this Lease, and stating whether or not, to
the best knowledge of the officer executing such certificate on behalf of
Landlord, Tenant is in default in performance of any covenant, agreement or
condition contained in this Lease and, if so, specifying each such default of
which the person executing such certificate may have knowledge.
ARTICLE 21.
Surrender; Holding Over
21.1 Surrender. Tenant shall and will on the Termination Date or upon any
earlier termination of this Lease, well and truly surrender and deliver up to
Landlord the Premises without delay and subject to the provisions of Article 11
hereof, in good order, condition and repair, and in substantially the same
condition as on the Lease Commencement Date, with such changes and improvements
thereto as Landlord shall have approved (without specifically requiring Tenant
to remove the same at the end of the Term), reasonable wear and tear excepted.
21.2 Holding Over. If Tenant fails or refuses to surrender and deliver up to
Landlord the Premises upon the Termination Date or upon any earlier termination
of this Lease, without Landlord's consent, then Landlord may at its option and
in addition to its other remedies, treat Tenant as a Tenant-at-sufferance. The
rent due to Landlord from Tenant during such holdover period shall be one and
one half (1 1/2) times the then Annual Base Rent.
ARTICLE 22.
Right of First Offer
22.1 Tenant's Right of First Offer. Prior to marketing the Premises for any
Transfer of the Premises, Landlord shall first give written notice to Tenant (a
"Transfer Notice") of Landlord's desire to transfer the Premises and the
specific terms and conditions that would be acceptable to Landlord, including
but not limited to price, closing conditions and time for closing ("Landlord's
Transfer Terms"). Tenant shall have the right (but not the obligation) during
the fifteen (15) day period after receipt of the Transfer Notice in which to
give Landlord either (1) written notice of Tenant's agreement to Landlord's
Transfer Terms, in which event Landlord shall transfer the Premises to Tenant,
and Tenant shall acquire the Premises from Landlord, in accordance with
Landlord's Transfer Terms, or (2) written notice of such other terms and
conditions on which Tenant would be willing to acquire the Premises from
Landlord, including but not limited to price, closing conditions and time for
closing ("Tenant's Transfer Terms"), in which event Landlord shall have fifteen
(15) days after receipt of Tenant's Transfer Terms to accept or reject Tenant's
Transfer Terms by written notice to Tenant. If Landlord accepts Tenant's
Transfer Terms, Landlord shall transfer the Premises to Tenant, and Tenant shall
acquire the Premises from Landlord, in accordance with Tenant's Transfer Terms
and such other terms as are mutually acceptable to Landlord and Tenant. If
Landlord rejects Tenant's Transfer Terms, Landlord shall be free, for a period
of one hundred eighty (180) days after its written notice to Tenant rejecting
Tenant's Transfer Terms, to transfer the Premises to any other Person on
Landlord's Transfer Terms or such other terms and conditions as Landlord may
determine, provided that such terms and conditions shall provide Landlord with
at least 95% of the purchase price included in Tenant's Transfer Terms. Tenant
shall have the right to review all agreements between Landlord and any other
Person governing the Transfer of the Premises to confirm that the terms and
conditions thereof are not less favorable than Tenant's Transfer Terms. If
Landlord does not so Transfer the Premises within the applicable one hundred
eighty (180) day period, the Premises shall forthwith again become subject to
Tenant's Right of First Offer hereunder. In the event Tenant fails to respond to
any Transfer Notice within thirty (30) days after receipt of same, Landlord
shall be free, for a period of one hundred eighty (180) days after such 30-day
period expires, to Transfer the Premises to any other Person on such terms and
conditions as Landlord, in its sole discretion, may determine. If Landlord does
not so Transfer the Premises within the applicable one hundred eighty (180) day
period, the Premises shall forthwith again become subject to Tenant's Right of
First Offer hereunder.
Notwithstanding Tenant's failure for any reason to purchase the Premises
from Landlord pursuant to this Section 22.1, this Lease shall remain in effect
in accordance with its terms and any Person that purchases the Premises from
Landlord shall take ownership of the Premises subject to this Lease, including,
without limitation, Tenant's Right of First Offer hereunder, which shall apply
to any future transfer of the Premises by said purchaser or its successors or
assigns.
ARTICLE 23.
General Provisions
23.1 Severability. If any term or provision of this Lease or the application
thereof to any person or circumstances shall, to any extent, be invalid or
unenforceable, the remainder of this Lease, or the application of such term or
provision to persons or circumstances other than those as to which it is held
invalid or unenforceable, shall not be affected thereby, and each term and
provision of this Lease shall be valid and be enforced to the fullest extent
permitted by law.
23.2 Notices. All notices, requests and other communications to any party
hereunder shall be in writing (including facsimile or similar writing) and shall
be given to such party at the following address or facsimile number:
To Landlord: HHC Broadview, Inc.
c/o Investcorp International
000 Xxxx Xxxxxx
Xxx Xxxx, XX 00000
Attn: Xxxx X. Xxxxx and F. Xxxxxxxx Xxxxxx
Fax: (212)
With a copy to: Xxxxx Xxxxxx, Esq.
Xxxxxx, Xxxx & Xxxxxxxx
000 Xxxx Xxxxxx
Xxx Xxxx, XX 00000
Fax: (000) 000-0000
To Tenant: Harborside of Cleveland Limited Partnership
c/o Harborside Healthcare
Xxx Xxxxxx Xxxxxx
Xxxxxx, XX 00000
Attn: President
Fax: (000) 000-0000
With a copy to: Xxxxxx X. Xxxxxxxx, Esq.
XxXxxxxxx, Will & Xxxxx
00 Xxxxx Xxxxxx
Xxxxxx, XX 00000
Fax: (000) 000-0000
or such other address or facsimile number as such party may hereafter specify to
Landlord and Tenant for purposes of notice. Each such notice, request or other
communication may be given by counsel and shall be effective (a) if given by
facsimile, when such facsimile is transmitted to the facsimile number specified
in this Section, (b) if given by mail, 72 hours after such communication is
deposited in the mails with first class postage prepaid, addressed as aforesaid,
(c) if given by a nationally recognized overnight delivery carrier, on the next
business day after delivery to such carrier, or (d) if given by any other means,
when delivered at the address specified in this Section.
23.3 Waiver of Jury Trial. The parties hereto waive a trial by jury of any and
all issues arising in any action or proceeding between them or their successors
under or connected with this Lease or any of its provisions, any negotiations in
connection therewith, or Tenant's use or occupation of the Premises.
23.4 Consent of Either Party.
-----------------------
(a) Where any provision of this Lease requires the consent or approval of
either party, each party agrees that except as specifically provided
otherwise in this Lease, it will not unreasonably withhold or delay such
consent or approval.
(b) If either party shall request the consent, approval or statement of
satisfaction of the other party with respect to any matter hereunder then,
except as specifically provided otherwise in this Lease, a failure by such
party to reply to such request within twenty (20) business days thereafter
shall be deemed to be consent, approval or statement of satisfaction as the
case may be.
23.5 Payments Under Protest. In case of any dispute between Landlord and Tenant
with respect to the amount of money payable by Tenant to Landlord under the
provisions of this Lease, Tenant shall be privileged to make payment under
protest and, in such event, shall be privileged to assert and prosecute a claim
or claims for the recovery of the sum, or any part thereof, that shall have been
so paid by Tenant under protest.
23.6 No Oral Modification. This Lease, the exhibits attached hereto or forming a
part hereof, and the Purchase Option set forth all of the covenants, promises,
agreements, conditions and understandings between Landlord and Tenant concerning
the Premises. Except as otherwise provided herein, this Lease may not be changed
or terminated orally or in any manner other than by an agreement in writing and
signed by the party against whom enforcement of the change or termination is
sought.
23.7 Covenants To Bind and Benefit Respective Parties. The terms, covenants,
provisions and agreements herein contained shall be construed as covenants
running with the Land and shall bind and inure to the benefit of Landlord, its
successors and assigns, and Tenant, its permitted successors and assigns.
23.8 Captions and Table of Contents. The captions of this Lease are for
convenience and reference only and in no way define, limit or describe the scope
or intent of this Lease nor in any way affect this Lease. The table of contents
preceding this Lease but under the same cover is for the purpose of convenience
and reference only and is not to be deemed or construed in any as part of this
Lease, nor as supplemental thereto or amendatory thereof.
23.9 Memorandum of Lease. Landlord and Tenant agree to execute concurrently with
the execution of this Lease and to cause to be recorded in the public records of
Cuyahoga County, Ohio a memorandum of this Lease substantially in the form of
Exhibit D. Tenant agrees to execute, deliver and record a memorandum of
termination of this Lease upon termination of this Lease in accordance with its
terms.
23.10 Waiver. The failure of either party to exercise any of its rights is not a
waiver of those rights. A party waives only those rights specified in writing
and signed by the party waiving its rights.
23.11 Governing Law. This Lease shall be governed by the laws of the State of
Ohio. Tenant hereby consents to personal jurisdiction in the courts of Ohio and
the United States District Court for the District in which the Facility is
situated as well as to the jurisdiction of all courts from which an appeal may
be taken from the aforesaid courts, for the purpose of any suit, action or other
proceeding arising out of or with respect to this Lease and expressly waives any
and all obligations Tenant may have as to venue in any of such courts.
23.12 Business Days. Business days means Monday through Friday inclusive,
excluding holidays. Throughout this Lease, wherever "days" are used the term
shall refer to calendar days. Wherever the term "business days" is used the term
shall refer to business days.
23.13 Time of the Essence. Time shall be of the essence as to the dates and
times of performance of each and every warranty, item, condition and covenant
under this Lease.
23.14 Delays. In any case where either party hereto fails to comply with any
term or provision of this Lease or to perform any act required under this Lease
as a result of a delay caused by or resulting from acts of God, war, civil
commotion, fire, flood or other casualty, strikes, inability to obtain labor,
materials or equipment, government regulations, unusually severe weather, or
other causes beyond such party's reasonable control, the performance of such act
shall be excused for the period of such delay, and the period for performance of
any such act shall be extended for a period equal to the period of such delay.
23.15 No Broker. Tenant represents that it has not dealt with any agent, broker
or similar person with respect to this Lease, and hereby indemnifies Landlord
against any and all parties who claim to have dealt with Tenant with regard to
this Lease. Landlord represents that it has not dealt with any agent, broker or
similar person with respect to this Lease, and hereby indemnifies Tenant against
any and all parties who claim to have dealt with Tenant with respect to this
Lease.
23.16 Authority. Tenant is duly authorized to make and enter into this Lease and
to carry out the transactions contemplated herein. Landlord is duly authorized
to make and enter into this Lease and to carry out the transactions contemplated
herein.
23.17 Attorneys' Fees and Litigation. In the event of litigation between the
parties to this Lease, the non-prevailing party in any such litigation shall
bear the full cost of such litigation, including the attorneys' fees of the
prevailing party; it being understood and agreed that the determination of which
party is the prevailing party shall be included in the matters which are the
subject of such action or suit.
23.18 Further Assurances. Each party from time to time shall execute and deliver
to the other such additional documents and provide such additional information
as such party may reasonably require to carry out the terms of this Lease;
provided nothing herein shall require Landlord to take any action that would
materially increase Landlord's obligations or liabilities hereunder, unless the
same are full assumed and paid by Tenant, or that would materially decrease
Landlord's rights hereunder, unless the same are fully compensated by Tenant.
23.19 Counterparts. This Lease may be executed and delivered in one or more
counterparts, each of which shall constitute an original, but all of which when
taken together shall constitute but one and the same agreement.
23.20 Landlord's Exculpation. Notwithstanding anything contained herein to the
contrary, Tenant shall look solely to Landlord to enforce Landlord's obligations
hereunder and no member, partner, shareholder, director, officer, principal,
employee or agent, directly or indirectly, of Landlord (collectively, the
"Exculpated Parties") shall be personally liable for the performance of
Landlord's obligations under this Lease. Tenant shall not seek any damages
against any of the Exculpated Parties. The obligations of the Landlord named
herein (or of any subsequent landlord) under this Lease accruing from and after
the sale, conveyance, assignment or transfer by the Landlord named herein (or by
any subsequent landlord) of its interest in the Premises shall not be binding
upon the Landlord named herein after the sale, conveyance, assignment or
transfer of the interest in the Premises of the Landlord named herein (or upon
any subsequent landlord after the sale, conveyance, assignment or transfer of
the interest in the Premises of such subsequent landlord); and in the event of
any such sale, conveyance, assignment or transfer, Landlord shall be and hereby
is entirely freed and relieved of all covenants and obligations of Landlord
hereunder that accrue from and after such sale, conveyance, assignment or
transfer of Landlord's interest in the Premises. The liability of Landlord for
Landlord's obligations under this Lease shall in all cases be limited to
Landlord's interest in the Premises and its other assets and Tenant shall not
look to any other property or assets of any Exculpated Parties in seeking either
to enforce Landlord's obligations under this Lease or to satisfy a judgment for
Landlord's failure to perform such obligations.
****
IN WITNESS WHEREOF, the undersigned have caused this Lease to be executed
on the date and year first above written.
In the presence of: TENANT:
HARBORSIDE OF CLEVELAND LIMITED PARTNERSHIP
________________________________ By: Harborside Health I Corporation, its duly
Print Name_______________________ authorized general partner
________________________________ By:__________________________________
Print Name ______________________ Xxxxx X. Xxxxxxxxx
its Vice President
LANDLORD:
HHC BROADVIEW, INC.
-------------------------------
Print Name ______________________ By: __________________________________
Xxxx X. Xxxxx
its Vice President
--------------------------------
Print Name ______________________
STATE OF )
)
COUNTY OF )
BEFORE ME, a Notary Public in and for said County and State,
personally appeared HHC BROADVIEW, INC., a Delaware corporation, by Xxxx X.
Xxxxx, its Vice President, who acknowledged that he did execute the foregoing
instrument and such execution is his free act and deed and the free act and deed
of such corporation.
IN TESTIMONY WHEREOF, I have hereunto set my hand and official seal at
____________, _______ this _____ day of September, 2000.
--------------------------
Notary Public
STATE OF )
)
COUNTY OF )
BEFORE ME, a Notary Public in and for said County and State personally
appeared HARBORSIDE OF CLEVELAND LIMITED PARTNERSHIP, by Harborside Health I
Corporation, its corporate general partner, by Xxxxx Xxxxxxxxx, its Vice
President, who acknowledged that he did execute the foregoing instrument on
behalf of said corporation and limited partnership and such execution is his
free act and deed and the free act and deed of such corporate general partner
and limited partnership.
IN TESTIMONY WHEREOF, I have hereunto set my hand and official seal at
_____________, ___________ this _____ day of September, 2000.
--------------------------
Notary Public
List of Exhibits
Exhibit A Legal Description of Land
Exhibit B Permitted Encumbrances
Exhibit C Form of Qualifying Non-Disturbance Agreement
Exhibit D Form of Memorandum of Lease
Exhibit E Form of Tenant's Certificate
-iv-
-1-
EXHIBIT A
LEGAL DESCRIPTION OF LAND
(BROADVIEW HEIGHTS)
Situated in the City of Broadview Heights, County of Cuyahoga and State
of Ohio and known as being part of Original Xxxxxxxxxxx Xxxxxxxx Xxx
Xx. 00 and bounded and described as follows:
Beginning at an iron monument in the centerline of Royalton Road at the
Southwesterly corner of said Original Lot No. 29;
Thence North 89 degrees 24 minutes 24 seconds East along the centerline
of Royalton Road being also the Southerly line of said Original Lot No.
29, 627.60 feet to its intersection with the Easterly line of a parcel
of land conveyed to HALHUB Realty Company by deed recorded in Volume
15610, Page 49 of Cuyahoga County Records;
Thence North 00 degrees 03 minutes 39 seconds East along the Easterly
line of said land conveyed to HALHUB Realty Company, 60.00 feet to an
angle point in the Northerly line of Royalton Road and the principal
place of beginning of the premises herein described;
Thence continuing North 00 degrees 03 minutes 39 seconds East along the
said Easterly line of land conveyed to HALHUB Realty Company, 5.00 feet
to an angle point in the Northerly line of Royalton Road;
Thence South 89 degrees 24 minutes 24 seconds West along the Northerly
line of Royalton Road, 30.74 feet to a point of curvature;
Thence Northwesterly along the curved turnout between the Northerly
line of Royalton Road and the Easterly line of Market Place West
(Proposed) 60 feet wide, being the arc of a circle deflecting to the
right, 31.42 feet to a point of tangency, said arc having a radius of
20 feet and a chord which bears North 45 degrees 35 minutes 36 seconds
West a distance of 28.28 feet;
Thence North 00 degrees 35 minutes 36 seconds West along the Easterly
line of Market Place West, 255.00 feet to a point of curvature.
Thence Northerly along the curved Easterly line of Market Place West,
being the arc of a circle deflecting to the left, 109.66 feet to a
point of reverse curvature, said arc having a radius of 306.68 feet and
a chord which bears North 10 degrees 50 minutes 13 seconds West a
distance of 109.08 feet;
Thence continuing Northerly along the curved Easterly line of Market
Place West, being the arc of a circle deflecting to the right, 82.49
feet to a point, said arc having a radius of 246.68 feet and a chord
which bears North 11 degrees 30 minutes 00 seconds West a distance of
82.11 feet;
Thence North 89 degrees 24 minutes 24 seconds East and parallel with
the said centerline of Royalton Road, 390.96 feet to a point in the
Easterly line of land conveyed to Broadview Heights Realty by deed
recorded in Volume 15028, Page 405 of Cuyahoga County Records;
Thence South 00 degrees 03 minutes 39 seconds West along the said
Easterly line of land conveyed to Broadview Heights Realty, 92.36 feet
to the Northeast corner of land conveyed to Xxxxxx and Xxxxxx Xxxxxxxx
by deed recorded in Volume 7037, Page 386 of Cuyahoga County Records;
Thence South 89 degrees 24 minutes 24 seconds West along the Northerly
line of said land conveyed to Xxxxxx and Xxxxxx Xxxxxxxx, 100 feet to
the Northwest corner of said land conveyed to Xxxxxx and Xxxxxx
Xxxxxxxx;
Thence South 00 degrees 03 minutes 39 seconds West along the Westerly
line of said land conveyed to Xxxxxx and Xxxxxx Xxxxxxxx, 385.64 feet
to the Northerly line of Royalton Road;
Thence South 89 degrees 24 minutes 24 seconds West along the Northerly
line of Royalton Road 43.00 feet to an angle point in the Northerly
line of Royalton Road;
Thence North 00 degrees 35 minutes 36 seconds West and perpendicular to
the centerline of Royalton Road 10.00 feet to an angle point in the
Northerly line of Royalton Road;
Thence South 89 degrees 24 minutes 24 seconds West along the Northerly
line of Royalton Road 156.89 feet to the principal place of beginning
and containing 3.0062 Acres of land, be the same more or less, but
subject to all legal highways.
The courses in this description are given to an assumed meridian and
are used to indicate angles only.
and bearing permanent parcel number: 000-00-000.
EXHIBIT B
PERMITTED ENCUMBANCES
1. Open-End Mortgage Deed from HHC Broadview, Inc. to Beacon Hill Mortgage
Corp., in the original amount of $9,435,000.00, dated September 26, 2000,
filed for record September 26, 2000, recorded in Document No. __________ of
Cuyahoga County Records.
2. Financing Statement from HHC Broadview, Inc. to Beacon Hill Mortgage Corp.,
dated September 26, 2000, filed for record on September 26, 2000 at _______
and recorded as Cuyahoga County Financing Statement No. ______________.
3. Right of Way contained in an instrument from The Halhub Realty Company to
The Ohio Xxxx Telephone Company, dated December 23, 1983, filed for record
January 19, 1984, recorded in Volume 84-0264, Page 23 of Cuyahoga County
Records.
4. Right of Way contained in an instrument from Broadview Heights Realty
Company to The Ohio Xxxx Telephone Company, dated December 23, 1983, filed
for record January 19, 1984, recorded in Volume 84-0264, Page 27 of
Cuyahoga County Records.
5. Memorandum of Lease by and between HHC Broadview, Inc. and Harborside of
Cleveland Limited Partnership, dated September 26, 2000, filed for record
September 26, 2000, recorded as Document No. _________ of Cuyahoga County
Records.
EXHIBIT C
FORM OF QUALIFYING NON-DISTURBANCE AGREEMENT
See Attached Form
SUBORDINATION, NONDISTURBANCE AND ATTORNMENT AGREEMENT
THIS SUBORDINATION, NONDISTURBANCE AND ATTORNMENT AGREEMENT (THIS
"Agreement") is made and entered into as of the _____ day of _______________,
______, by and between [NAME OF LENDER], a ________________________ ("Lender")
and HARBORSIDE OF CLEVELAND LIMITED PARTNERSHIP, a Massachusetts limited
partnership ("Tenant').
RECITALS:
A. Lender has made a loan or is about to make a loan to HHC BROADVIEW, INC, a
Delaware corporation ("Landlord"), secured by a mortgage (the "Mortgage")
covering the land situated in Broadview Heights, Ohio, more particularly
described on Exhibit A attached hereto and made a part hereof, together
with the improvements now or hereafter erected thereon (said land and
improvements thereon being hereinafter collectively referred to as the
"Real Property").
B. By a certain lease identified on Exhibit B attached hereto (the lease and
all amendments, extensions and renewals thereto are hereinafter called the
"Lease"), Landlord leased all or a portion of the Real Property to Tenant.
C. As a condition precedent to Lender's disbursement of loan proceeds, Lender
has required that Tenant certify and confirm certain matters about the
Lease to lender and subordinate the Lease and its interest in the Real
Property in all respects to the lien of the Mortgage.
D. As a condition precedent to Tenant's subordinating the Lease, Tenant is
requiring that Lender agree not to disturb its tenancy in the event of
foreclosure of the Mortgage.
NOW, THEREFORE, in consideration of the foregoing and the mutual
covenants herein contained, the sum of One Dollar and other good and valuable
consideration, the receipt and sufficiency whereof are hereby acknowledged by
each of the parties hereto, the Lender and Tenant, intending to be legally
bound, hereby agree as follows:
1. Representations and Warranties of Tenant. Tenant represents and warrants to
Lender, as of the date hereof, that Tenant is entitled to no credit and no
offset or deduction in rent, and Tenant has no claims or defenses to
enforcement of the Lease.
2. Subordination. The Lease, the leasehold estate created thereby, and the
rights of Tenant in, to or under the Lease and the Real Property, are
hereby subjected and subordinated and shall remain in all respects and for
all purposes subject, subordinate and junior to the lien of the Mortgage,
as fully and with the same effect as if the Mortgage had been duly
executed, acknowledged and recorded, and the indebtedness secured thereby
had been fully disbursed, prior to the execution of the Lease or possession
of any portion of the Real Property by Tenant, or its predecessors in
interest.
3. Reliance by Lender. The parties further agree that the disbursement by
Lender of all or any substantial part of the indebtedness shall constitute
conclusive reliance by Lender upon this instrument and the provisions
hereof and the subordination effected hereby.
4. Tenant Not to Be Disturbed. So long as Tenant attorns to Lender and is not
in Default, as defined in the Lease, Tenant's rights under the Lease
including but not limited to quiet enjoyment and possession of the Real
Property, shall not be diminished or interfered with by Lender, and Lender
shall not transfer or otherwise convey the Certificate of Need applicable
to the nursing home located on the Real Property except to a party to whom
it conveys the Real Property.
5. Tenant to Attorn to Lender. If the interests of Landlord shall be
transferred to and owned by Lender by reason of foreclosure or other
proceedings brought by it in lieu of or pursuant to a foreclosure, or by
any other manner, and Lender succeeds to the interest of the Landlord under
the Lease, Tenant shall be bound to Lender under all of the terms,
covenants and conditions of the Lease for the balance of the term thereof
remaining and any extensions or renewals thereof which may be with the same
force and effect as if Lender were the landlord under the Lease; and Tenant
shall attorn to Lender, as its landlord, said attornment to be effective
and self-operative immediately upon Lender sending written notice to Tenant
advising that Lender has succeeded to the interest of Landlord in the Real
property without the execution of any further instruments on the part of
any of the parties hereto. Except in the event of default by Landlord under
the Mortgage and notice thereof from Lender, and without affecting Lender's
security interest in rent due under the Lease, Tenant shall be under no
obligation to pay rent to Lender until Tenant receives written notice from
Lender that it has succeeded to the interest of Landlord under the Lease.
The respective rights and obligations of Tenant and Lender upon such
attornment, to the extent of the then remaining balance of the term of the
Lease and any such extensions and renewals, shall be and are the same as
now set forth therein, it being the intention of the parties hereto for
this purpose to incorporate the Lease in this Agreement by reference with
the same force and effect as if set forth in length herein.
6. Lender Not Bound by Certain Acts of Landlord. If Lender shall succeed to
the interest of Landlord under the Lease, Lender shall not (a) be liable
for any act or omission of any landlord (including Landlord) occurring
prior to Lender's succession; (b) be subject to any offsets or defenses
which Tenant might have against landlord (including Landlord) arising prior
to Lender's succession; (c) be bound by any security deposits or by any
rent or additional rent (excluding the Initial Replacement Reserve) which
Tenant might have paid for more than one month in advance; nor (d) be bound
by any amendment or modification of the Lease or any release from liability
of any party liable for the obligations of Tenant under the Lease made
after the date of this Agreement without Lender's consent.
7. Notice and Cure of Landlord's Default. No notice by Tenant to Landlord
under the Lease shall be binding on Lender unless a copy thereof is sent to
Lender. Tenant agrees to send Lender a copy of any notice relating to a
breach or default under the Lease at the same time any such notice is sent
to Landlord. Tenant agrees that if any such notice relates to the breach or
default by Landlord under the Lease, then Lender, at its sole option and
without obligation so to do, may cure any such default within a reasonable
period, but in no event less than any period of time as would be available
to Landlord, but measured from the date that Tenant delivers a copy of such
notice to Lender.
8. No Modification. No modification, amendment, or release or any provisions
of this Agreement, or of any right, obligation, claim, or cause of action
arising hereunder shall be valid or binding for any purpose whatsoever
unless in writing and executed by the party against whom the same is sought
to be asserted.
9. Notices. All notices required to be given hereunder shall be given in
writing to the appropriate party or parties at the following addresses:
To Landlord: HHC Broadview, Inc.
c/o Investcorp International
000 Xxxx Xxxxxx
Xxx Xxxx, XX 00000
Attn: Xxxx X. Xxxxx and F. Xxxxxxxx Xxxxxx
Fax: (000) 000-0000
With a copy to: Xxxxx Xxxxxx, Esq.
Xxxxxx, Xxxx & Xxxxxxxx
000 Xxxx Xxxxxx
Xxx Xxxx, XX 00000
Fax: (000) 000-0000
To Tenant: Harborside of Cleveland Limited Partnership
c/o Harborside Healthcare
Xxx Xxxxxx Xxxxxx
Xxxxxx, XX 00000
Attn: President
Fax: (000) 000-0000
With a copy to: Xxxxxx X. Xxxxxxxx, Esq.
XxXxxxxxx, Will & Xxxxx
00 Xxxxx Xxxxxx
Xxxxxx, XX 00000
Fax: (000) 000-0000
To Lender: _______________________________
===============================
-------------------------------
or at such other place as such party may designate in writing to the other
party. All notices shall be deemed to have been delivered (a) upon delivery if
hand-delivered, (b) on the next business day after deposit with a recognized
overnight courier, or (c) on the date shown on the return receipt if delivered
by registered mail, return receipt requested.
10. Landlord's Consent. Landlord is joining herein solely for the purpose of
consenting to the terms and conditions of this Agreement and agreeing that
Tenant may rely upon any and all notices from Lender relating to the rights
of Lender hereunder and under the Mortgage.
11. Successors and Assigns. This Agreement and each and every covenant,
agreement and other provisions hereof shall be binding upon the parties
hereto and their heirs, administrators, representatives, successors and
assigns, including without limitation each and every holder of the
landlord's or the tenants interest in the Lease, including purchasers at a
foreclosure sale and any other person having an interest therein, and shall
inure to the benefit of Lender and its successors and assigns.
12. Choice of Law. This Agreement shall be constructed and enforced according
to, and governed by, the laws of the State of Ohio without reference to
conflicts of laws provisions which, but for this provision, would require
the application of the law of any other jurisdiction.
13. Captions and Headings. The captions and headings of the various sections of
this Agreement are for convenience only and are not to be construed as
confining or limiting in any way the scope or intent of the provisions
hereof. Whenever the context requires or permits, the singular shall
include the plural, the plural shall include the singular and the
masculine, feminine and neuter shall be freely interchangeable.
14. Counterparts. This Agreement may be executed in any number of counterparts
for the convenience of the parties, all of which, when taken together and
after execution by all parties hereto, shall constitute one and the same
Agreement.
IN WITNESS WHEREOF, the parties hereto have each caused this Agreement
to be executed as of the date first above written.
In the presence of: TENANT:
HARBORSIDE OF CLEVELAND
LIMITED PARTNERSHIP
___________________________________ By: Harborside Health I Corporation,
Print Name: _______________________ its duly authorized general partner.
___________________________________ By: ___________________________
Print Name: _______________________ Its _____________________
In the presence of: LENDER:
----------------------------------- --------------------------------
Print Name: _______________________ By _____________________________
Its ____________________________
-----------------------------------
Print Name: _______________________
The foregoing Agreement is hereby consented and agreed to by the
undersigned as set forth in Section 10 hereof.
In the presence of : HHC BROADVIEW, INC.
_________________________________ By:____________________________
Print Name: _______________________ Its__________________________
---------------------------------
Print Name: _______________________
Acknowledgement of Lender
STATE OF )
) SS.
COUNTY OF )
Before me, a Notary Public in and for said County and State, personally
appeared the above-named [NAME OF LENDER], by ________________________, its
___________________, who acknowledged that he did sign the foregoing instrument
for and on behalf of said corporation, and that the same is the free act and
deed of said corporation and his free act and deed individually. IN TESTIMONY
WHEREOF, I have hereunto set my hand and official seal at ___________,
____________, this ______ day of ______________, ______.
----------------------
Notary Public
Acknowledgement of Landlord
STATE OF )
) SS.
COUNTY OF )
Before me, a Notary Public in and for said County and State, personally
appeared the above-named [NAME OF LANDLORD] by ____________________, its
____________, who acknowledged that he did sign the foregoing instrument for and
on behalf of said corporation, and that the same is the free act and deed of
said corporation and his free act and deed individually.
IN TESTIMONY WHEREOF, I have hereunto set my hand and official seal at
________________, _______________ this _______ day of ____________,
________.
---------------------------
Notary Public
Acknowledgment of Tenant
STATE OF )
) SS.
COUNTY OF )
Before me, a Notary Public in and for said County and State, personally
appeared the above-named Harborside of Cleveland Limited Partnership, by
Harborside Health I Corporation, its corporate general partner by
____________________________, its ______________, ______________, who
acknowledged that he did sign the foregoing instrument for and on behalf of said
corporate general partner and limited partnership, and that the same is the free
act and deed of said corporate general partner and limited partnership and his
free act and deed individually.
IN TESTIMONY WHEREOF, I have hereunto set my hand and official seal at
_________________, this _______ day of _____________, ___________.
---------------------
Notary Public
-iv-
EXHIBIT D
FORM OF MEMORANDUM OF LEASE
See Attached Form
-1-
MEMORANDUM OF LEASE
THIS MEMORANDUM OF LEASE, dated this 26th day of September, 2000, by
and between HHC BROADVIEW, INC., having its principal office at c/o Investcorp
International, 000 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000 ("Landlord"), and
HARBORSIDE OF CLEVELAND LIMITED PARTNERSHIP, a Massachusetts limited partnership
having its principal office c/o Harborside Healthcare, Xxx Xxxxxx Xxxxxx,
Xxxxxx, Xxxxxxxxxxxxx 00000, ("Tenant").
WITNESSETH:
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1. For and in consideration of One Dollar ($1.00) and other good and
valuable consideration paid by Tenant to Landlord and in further consideration
of the rents reserved and the covenants and conditions more particularly set
forth in that certain Lease between Landlord and Tenant dated September 26,
2000, (the "Lease"), the Landlord demised and let unto Tenant and Tenant leased
and took from the Landlord that certain parcel of land and the improvements
thereon described in Exhibit "A" attached hereto and made a part hereof (the
"Premises").
2. The term of the Lease commenced September 26, 2000, and shall
terminate September 30, 2015, provided that the term is subject to the rental,
covenants, provisions and conditions contained in the Lease. Tenant has the
right to extend the term of the Lease for two five-year renewal terms. Subject
to the terms of the Lease, Tenant also has the right of first offer in the event
Landlord decides to market the Premises.
3. This Memorandum of Lease is executed in simplified short form solely
for the convenience of the parties and for the purpose of recording the same.
This Memorandum of Lease shall not have the effect of in any way modifying,
supplementing or abridging the Lease or any of its provisions as the same are
now or may hereafter be in force and effect.
IN WITNESS WHEREOF, the parties hereto have set their hands to
duplicate hereof the day and year first above written.
WITNESS: LANDLORD:
_______________________________ HHC BROADVIEW, INC.,
Name: a Delaware Corporation
_______________________________ By: ________________________________
Name: Xxxx X. Xxxxx, its Vice President
TENANT:
HARBORSIDE OF CLEVELAND LIMITED PARTNERSHIP, a
______________________________ Massachusetts limited partnership
Name:
By: HARBORSIDE HEALTH I CORPORATION, a Delaware
corporation
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Name: By: _______________________________
Xxxxx X. Xxxxxxxxx, its Vice President
ACKNOWLEDGEMENT OF LANDLORD
STATE OF )
) SS:
COUNTY OF )
BEFORE ME, the undersigned, a Notary Public in and for said County and
State, personally appeared Xxxx X. Xxxxx known to me to be the Vice President of
HHC BROADVIEW, INC. a Delaware corporation, the corporation which executed the
foregoing instrument, and acknowledged to me that he did sign said instrument in
the name and on behalf of said corporation, and that the same is his free act
and deed and the free act and deed of said corporation.
IN TESTIMONY WHEREOF, I have hereunto set my hand and official seal at
_______________, ______________ this ______ day of September 2000.
----------------------------
Notary Public
ACKNOWLEDMENT OF TENANT
STATE OF )
) SS:
COUNTY OF )
BEFORE ME, the undersigned, a Notary Public in and for said County and
State, personally appeared Xxxxx X. Xxxxxxxxx, the Vice President of HARBORSIDE
HEALTH I CORPORATION, a Delaware corporation, the general partner of HARBORSIDE
OF CLEVELAND LIMITED PARTNERSHIP, a Massachusetts limited partnership, the
Limited Partnership which executed the foregoing instrument, and acknowledged to
me that he did sign said instrument in the name and on behalf of said
corporation as corporate general partner of said Limited Partnership, being
thereunto duly authorized by all necessary corporate and partnership action; and
that such signing is his free act and deed individually and the free act and
deed of said corporate general partner and said Limited Partnership.
IN TESTIMONY WHEREOF, I have hereunto set my hand and official seal at
__________________, __________ this ______ day of September 2000.
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Notary Public
-v-
EXHIBIT E
FORM OF TENANT'S CERTIFICATE
See Attached Form
ESTOPPEL CERTIFICATE FORM
The undersigned, HARBORSIDE OF CLEVELAND LIMITED PARTNERSHIP
("Tenant"), is (a) the tenant under that certain Lease dated as of September
___, 2000 (which, together with all amendments, modifications and supplements
thereto, is attached hereto and made a part hereof as Exhibit A and is
hereinafter referred to as the "Lease") between Tenant and HHC BROADVIEW, INC.
(the "Landlord"), for the space known as and by the street address 0000 Xxxx
Xxxxxxxx Xxxx, Xxxxxxxxx Xxxxxxx, Xxxx (the "Leased Premises"), and (b) the
optionee under that certain Option to Purchase Agreement dated as of September
___, 2000 (which, together with all amendments, modifications and supplements
thereto, is attached hereto and made a part hereof as Exhibit B and is
hereinafter referred to as the "Option Agreement"), between Tenant and the
Landlord with respect to the Leased Premises.
[With the understanding that ________________ ("Purchaser") and its
lenders, successors and assigns including _____________________("Lender") will
rely on the representations made herein in connection (i) Purchaser's purchase
of the Building and other property, (ii) the assignment to Purchaser of the
Lease, and (iii) Lender's financing of the purchase of the Building and other
property],1 Tenant hereby represents, warrants and certifies to the Landlord,
[Purchaser and Lender] that, except as otherwise disclosed in writing by Tenant
on Schedule I attached hereto, the following statements are true, correct and
complete as of the date hereof:
1. The Lease and Option Agreement, in the form attached hereto (i) is in full
force and effect and is the legal, valid and binding obligation of Tenant,
(ii) is enforceable against Tenant in accordance with its terms, and (iii)
has not been modified, supplemented, canceled, or amended in any respect,
except as follows:
2. The term of the Lease commenced on and shall expire on _______, subject to
the exercise of any of the options, if any, described in paragraph (3)
below.
3. Tenant has options to renew the term of the Lease, each for a period of
years. Tenant has not exercised any of the options except as follows:
4. There are currently no actions or proceedings (including, without
limitation, arbitrations) between Landlord and Tenant (or their respective
affiliates) affecting the Lease and/or the Option Agreement.
5. Tenant is not in default under the Lease or the Option Agreement, Tenant
has not received any notices of default under the Lease or the Option
Agreement which has not been cured. Tenant has no claims, counterclaim,
defenses or rights of offset against any rents or other amounts due and/or
payable to Landlord under the Lease.
6. The monthly rent ("Rent") for the Leased Premises is currently $ , the Rent
is now fully accruing under the Lease, and the Rent has been paid through .
Further, no Rent has been prepaid more than thirty (30) days in advance.
Tenant is obligated to pay for all utilities, taxes and other operating
expenses incurred at the Building.
7. Tenant is in possession of, and is occupying the Leased Premises and
conducting business therein. The Lease has not been assigned, by operation
of law or otherwise, and no sublease, concession agreement, or license
covering the Leased Premises, or any portion thereof, has been entered
into.
8. The undersigned, the Landlord has not defaulted under the Lease and/or the
Option Agreement, and no event has occurred that, with the giving of
notices or the passage of time or both could result in a default under the
Lease and/or the Option Agreement.
9. Tenant is not entitled to any rent concessions, free rent, allowances or
other similar compensation relating to the Leased Premises.
10. There are no actions, whether voluntary or otherwise, pending against
Tenant under the bankruptcy or insolvency laws of the United States or any
state thereof.
11. Tenant has accepted completed possession of the Leased Premises, all
improvements thereon or thereto required to be made by Landlord, if any,
have been completed to the satisfaction of Tenant, all cash allowances, if
any, due Tenant for the leasing and the initial construction of the Leased
Premises have been completed to the satisfaction of Tenant, all cash
allowances, if any, due Tenant for the leasing and the initial construction
of the Leased Premises have been paid in full in accordance with the Lease,
and Landlord has no obligation to assume Tenant's liabilities under leases
of other premises (whether within the Building, on the Leased Premises or
elsewhere).
12. Tenant has not received any notice of any violation of any federal, state,
county or municipal laws, regulations, ordinances, orders or directives
relating to the use, operation or condition of the Leased Premises.
13. The address for notices to be sent to Tenant is as set forth in the Lease
or as set forth below.
14. Tenant, its agents, employees, guests and invitees, do not store, use,
produce, or dispose of, and have at no time in the past stored, used,
produced or disposed of, any substance at the Leased Premises, exposure to
which is regulated by any federal, state or local environmental or health
law, rule or regulation, and Tenant has no knowledge of the storage, use or
disposal thereof on the Leased Premises or the Building.
15. This certificate and the representations made herein shall be governed by
the laws of the State of Ohio.
16. [Tenant acknowledges that the Landlord has the right to assign the Lease
(and all rents and other performance due from Tenant thereunder) to
Purchaser. Tenant agrees that upon its receipt of written notification from
the Landlord of the sale of the Leased Premises to Purchaser, Tenant will
tender all further performance due from it to Purchaser or its nominee and
will otherwise attorn to said party.]
IN WITNESS WHEREOF, this certificate has been duly executed and
delivered by the authorized officer of the undersigned as of ___________, ____.
HARBORSIDE OF CLEVELAND LIMITED PARTNERSHIP
By: Harborside Health I Corporation,
its general partner
By: __________________________
Name:
Title:
Exhibit A
THE LEASE
Exhibit B
THE OPTION AGREEMENT
1 The bracketed language to be added in connection with a sale or financing.
