CONTRACT OF ACQUISITION
between
HEALTH CARE PROPERTY INVESTORS, INC.,
as Buyer
and
INTEGRATED LIVING COMMUNITIES AT CABOT POINTE, INC.,
as Seller
Dated as of September 30, 1996
CONTRACT OF ACQUISITION
This Contract of Acquisition (this "Agreement") is dated as of
September 30, 1996 between HEALTH CARE PROPERTY INVESTORS, INC., a Maryland
corporation ("Buyer"), and INTEGRATED LIVING COMMUNITIES AT CABOT POINTE, INC.,
a Delaware corporation ("Seller").
RECITALS
WHEREAS, Seller desires to transfer or cause to be transferred
to Buyer, and Buyer desires to acquire, the Property (as hereinafter defined),
which such transfer shall be effectuated by Seller executing and delivering a
deed to the Property, or one or more portions thereof, and a xxxx of sale and
assignment with respect to the Personal Property (as hereinafter defined); and
WHEREAS, simultaneously therewith, Buyer and Seller desire
that Buyer enter into a lease of the Property with Seller;
NOW, THEREFORE, the parties hereto agree as follows:
ARTICLE 1
DEFINITIONS
For all purposes of this Agreement, except as otherwise
expressly provided herein or unless the context otherwise requires, (i) the
terms defined in this Article have the meanings assigned to them in this Article
and include the plural as well as the singular; (ii) all accounting terms not
otherwise defined herein have the meanings assigned to them in accordance with
generally accepted accounting principles as at the time applicable; (iii) all
references in this Agreement to designated "Articles," "Sections" and other
subdivisions are to the designated Articles, Sections and other subdivisions of
this Agreement; (iv) the word "including" shall have the same meaning as the
phrase "including, without limitation," and other phrases of similar import; and
(v) the words "herein," "hereof" and "hereunder" and other words of similar
import refer to this Agreement as a whole and not to any particular Article,
Section or other subdivision.
Affiliate: As defined in the Lease.
Allocated Expense Deposit: That portion of the Master Expense
Deposit allocated to the transactions contemplated hereby and the Exhibits
hereto as provided in Section 2.6.
Best Knowledge: With respect to any Person shall mean as to
any fact or other matter that (i) such Person is actually aware of such fact or
other matter, or (ii) a prudent Person could be expected to discover or
otherwise become aware of such fact or other matter in the
course of conducting a reasonably diligent inquiry calculated to ascertain the
truth, accuracy or existence of such fact or other matter. A Person other than
an individual shall not be deemed to have knowledge or to be actually aware of a
particular fact or other matter unless such fact or other matter is actually
known or under reasonable circumstances should have been known by an officer or
director of such Person. In other words, in no event shall knowledge be imputed
to such Person simply because specific knowledge may have come to the attention
of such Person's agent, consultant or other employee, unless and to the extent
the same is actually known or under reasonable circumstances should have been
known by an officer or director of such Person.
Xxxx of Sale and Assignment: A xxxx of sale and general
assignment substantially in the form attached hereto as Exhibit B conveying the
Personal Property to Buyer.
Buyer's Legal Costs: Collectively, the reasonable legal fees,
expenses and disbursements to counsel incurred by Buyer in connection with the
preparation and negotiation of this Agreement, the other Transaction Documents
and the Exhibits hereto and thereto, the review of diligence materials,
documents and other information relating to the Property and the consummation of
the transactions contemplated hereunder and the Exhibits hereto. As used herein,
legal fees and expenses shall include both outside legal fees and expenses as
well as legal fees of Buyer's in-house counsel. For purposes of the foregoing,
outside legal fees for attorney time shall be billed at the normal hourly rate
charged by Buyer's counsel and legal fees for in-house attorney time shall not
be in excess of $125.00 per hour.
Buyer's Transaction Costs: Collectively, Buyer's Legal Costs
and the other reasonable and customary fees and expenses of and disbursements
incurred or made by Buyer in connection with the transactions contemplated
hereby and the Exhibits hereto, including appraisal costs, engineering fees,
accountants and other professional fees, environmental audits and travel
expenses. Upon the written request of Seller, Buyer shall provide to Seller
copies of invoices and other back-up information as may be reasonably requested
by Seller to substantiate Buyer's Transaction Costs.
Closing: The transactions taking place on the Closing Date.
Closing Date: The date on which Buyer receives conveyance of
good and marketable title to the Property, free and clear of all liens, claims
and encumbrances (except Permitted Encumbrances), which date is estimated to be
October 15, 1996.
Commencement Date: As defined in the Lease.
Commitment Letter: The master letter of intent and agreement
dated June 11, 1996 between Buyer and Seller's Affiliate, ILC, as amended by
letter dated August 23, 1996 and letter dated of even date herewith, setting
forth the terms and conditions of certain proposed transactions, including the
transaction contemplated herein, as the same may have been or may hereafter
further be amended or supplemented from time to time in writing. To the extent
of any conflict between the Commitment Letter and this Agreement or the Exhibits
hereto or any other document or instrument executed and delivered in connection
with the transactions
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contemplated hereby or thereby, this Agreement or such other documents or
instruments shall control over the Commitment Letter with respect to the
transactions contemplated hereby and the Exhibits hereto.
Commitment Letter Amendment: An amendment to the Commitment
Letter in the form of Exhibit E attached hereto, to be executed by Buyer and
Seller's Affiliate, ILC, on the Closing Date.
Condemnation: As defined in the Lease.
Consumables: All consumable goods and supplies, including
inventories of food, beverages, pharmaceuticals, medical supplies, linens,
clothing or similar items utilized in connection with the operation and/or
maintenance of the Facility.
Deed: The Special Warranty Deed in form reasonably acceptable
to Buyer, conveying the Property to Buyer.
Excluded Property: All (i) Resident and/or Patient Agreements,
(ii) Consumables, (iii) trade names relating to the Property, (iv) general
corporate trademarks, service marks, logos and insignia, goodwill, accounts
receivable, and books or records of Seller, (iv) any certificate of need or
similar certificate for the Property, (v) any third-party provider agreements
(including Medicare and Medicaid) relating to the Property, (vi) any health care
license or other operating license for the Property, (vii) any operating
agreement for the Property, (viii) any vehicles and (ix) the property, if any,
listed as "Excluded Property" on the Schedule 2 attached hereto.
Facility: The land and related improvements and fixtures of
the "Cabot Pointe Alzheimer's Care Facility" located in the County of Manatee,
State of Florida, comprised of the approximately 17,000 square foot, 54-bed
Alzheimer's assisted-living care facility and the approximately 1.69 gross acre
parcel of land, which land is more particularly described on Exhibit A attached
hereto.
Flood Hazard Area: An area designated by the Federal Emergency
Management Agency and/or Secretary of Housing and Urban Development as having
special flood hazards.
Governmental Authority: The United States, the state or
commonwealth, county, parish, city and political subdivisions in which the
Property is located or which have jurisdiction over the Property or use of the
Facility thereon for all uses contemplated by the Lease, and any court
administrator, agency, department, commission, board, bureau or instrumentality
or any of them which have jurisdiction over the Property or the construction or
use of the Property for all uses contemplated by the Lease.
Governmental Requirement: Any law, ordinance, order, rule,
regulation, decree or similar edict of a Governmental Authority.
Guarantor: ILC.
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Guaranty: The guaranty of Seller's obligations hereunder and
Lessee's obligations under the Lease in the form of Exhibit D, to be executed by
Guarantor on the Closing Date.
Hazardous Substances: As defined in the Lease.
ILC: Integrated Living Communities, Inc., a Delaware
corporation.
Intangible Property: All Permits and other intangible property
or any interest therein now or on the Closing Date owned or held by Seller in
connection with the Property, or any business or businesses now conducted by
Seller thereon or with the use thereof, including all rights of Seller in and to
all Plans and Specifications, leases, contract rights, agreements, water rights
and reservations, zoning rights, business licenses, warranties and guaranties
(including those relating to construction and/or fabrication) related to the
Property, or any part thereof; provided, however, that "Intangible Property"
shall not include any of the Excluded Property.
Lease: The lease of the Facility in the form of Exhibit C, to
be executed by Buyer, as Lessor, and Seller, as Lessee, on the Closing Date.
Lease Commitment Fee: An amount equal to One Percent (1%) of
the Purchase Price (i.e., $28,300.00), which amount is due and payable from
Seller to Buyer at the Closing as provided in Section 2.7 below.
Leased Property: As defined in the Lease.
Lessee: As defined in the Lease.
Lessor: As defined in the Lease.
Master Expense Deposit: As defined in Section 2.6 below.
Minimum Rent: As defined in the Lease.
Organizational Documents: Collectively, as applicable, the
articles or certificate of incorporation, certificate of limited partnership or
certificate of limited liability company, by-laws, partnership agreement,
operating company agreement, trust agreement, statement of partnership,
fictitious business name filings and all other organizational documents relating
to the creation, formation and/or existence of a business entity, together with
resolutions of the board of directors, partner or member consents, trustee
certificates, incumbency certificates and all other documents or instruments
approving or authorizing the transactions contemplated hereby and the Exhibits
hereto.
Permits: All permits, licenses, approvals, entitlements and
other authorizations issued by Governmental Authorities including certificates
of occupancy, those required in connection with the ownership, planning,
development, construction, use, operation and/or maintenance of the Facility for
its Primary Intended Use, and all amendments, modifications,
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supplements, general conditions and addenda thereto, other than any licenses,
certificates or permits included within the definition of Excluded Property.
Permitted Encumbrances: Collectively, (i) liens for taxes,
assessments and governmental charges not yet past due and payable or delinquent,
(ii) the title exceptions and other matters of record set forth on Schedule 1
hereto and (iii) such other title exceptions, if any, as Buyer shall have
approved in writing, in its sole and absolute discretion.
Personal Property: All Intangible Property and all tangible
personal property of every kind and nature owned by Seller and located at, upon
or about, or affixed or attached to, or installed in the Facility or used or to
be used in connection with or otherwise relating to the Facility or its
ownership, planning, development, construction, operation and/or maintenance,
including the following:
(i) All equipment, machinery, fixtures, furniture and
furnishings and other tangible personal property, including all components
thereof, now or on the Closing Date located in, on or used in connection with
the Facility, including all furnaces, boilers, heaters, electrical equipment,
heating, plumbing, lighting, ventilating, refrigerating, incineration, air and
water pollution control, waste disposal, air cooling and air conditioning
systems, apparatus, sprinkler systems, fire and theft protection equipment,
built-in oxygen and vacuum systems, tools, repair parts, appliances and
communications equipment, to the extent any of the foregoing items are not
conveyed to Buyer as part of the Facility pursuant to the Deed; and
(ii) Those specific items of tangible personal property
described on Exhibit E attached hereto.
Notwithstanding the foregoing, "Personal Property" shall not include any of the
Excluded Property.
Plans and Specifications: All drawings (including final and
complete "as-builts"), plans, specifications, blueprints, maps, studies,
structural reviews, surveys (including "as-built") and engineering, soil,
seismic, geologic, architectural and other reports relating to the Property.
Primary Intended Use: As defined in the Lease.
Property: The Facility or, where applicable, the Facility
together with the Personal Property.
Purchase Price: Two Million Eight Hundred Thirty Thousand
Dollars ($2,830,000.00).
Resident and/or Patient Agreements: Any and all leases, rental
and occupancy agreements, lease commitments, admission and payment documents,
reservation agreements and concessions, all deposits made thereunder, and any
and all patient and/or resident trust accounts, in each case with respect to the
Property.
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State: The State or Commonwealth in which the Property is located.
Title Insurer: First American Title Insurance Company.
Title Policy: As defined in Section 3.5.
Transaction Documents: Collectively, this Agreement, the Deed,
the Xxxx of Sale and Assignment, the Lease, the Guaranty and the Commitment
Letter Amendment.
ARTICLE 2
TERMS OF THE SALE AND LEASEBACK
Section 2.1 Sale. On the Closing Date, subject to the
conditions of this Agreement, Seller agrees to convey or cause to be conveyed,
and Buyer agrees to acquire, the Property for the Purchase Price. The Purchase
Price shall be paid in cash on the Closing Date by wire transfer or such other
method as Buyer and Seller may agree upon. The Purchase Price shall be allocated
as follows:
Land & Improvements
(including permanent fixtures) $2,700,000.00
Personal Property (other than
permanent fixtures) 130,000.00
----------
Total $2,830,000.00
=============
Section 2.2 Closing. The Closing shall be held at the offices
of Xxxxxx & Xxxxxxx, 000 Xxxx Xxxxx Xxxxxx, Xxx Xxxxxxx, Xxxxxxxxxx, or at such
other location as Buyer and Seller may agree upon or through an escrow or
sub-escrow with Title Insurer. In the event that the Closing is to take place
through an escrow or sub-escrow, the parties shall mutually execute and deliver
to Title Insurer, as escrow holder, joint escrow and/or recording instructions
consistent with this Agreement on or prior to the Closing Date. In the event of
any conflict between the provisions of this Agreement or any such escrow and/or
recording instructions or any general instructions required by Title Insurer to
be executed by Buyer and Seller in connection therewith, the provisions of this
Agreement shall control. If the Closing does not take place on or prior to
October 18, 1996, Buyer may terminate this Agreement in its sole and absolute
discretion.
Section 2.3 Conveyance. On the Closing Date, subject to the
terms and conditions of this Agreement, Seller shall deliver, or cause to be
delivered, the Deed and the Xxxx of Sale and Assignment and such other
instruments as shall be necessary to convey, assign or grant to Buyer good and
marketable title to the Property, free and clear of all liens, claims and
encumbrances (except for Permitted Encumbrances). Each party shall execute and
deliver such instruments and take such actions as either party may reasonably
request in order to effectuate the purposes of this Agreement.
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(a) The Deed shall be sufficient to convey good and
indefeasible fee simple title to the Property (other than the Personal
Property), shall be duly executed, acknowledged and in recordable form.
The Deed shall include (if applicable) the appropriate state and/or
county real estate transfer tax declaration of real estate value or
other affidavit as to the tax due on gross income derived from the
sale. The Deed shall be deemed to include all appurtenances to the
Property conveyed thereby, including all right, title and interest, if
any, of the grantor in and to any land lying in the bed of any street
adjoining the Property to the center line thereof, and any existing
improvements located on the Property.
(b) The Xxxx of Sale and Assignment shall be
sufficient to convey good and marketable title to the Personal Property
and shall be duly executed. In addition, Seller will execute or obtain
and deliver to Buyer on the Closing Date such other instruments and/or
documents as may be necessary to effectively convey title to the
Personal Property.
(c) On the Closing Date, Buyer, as Lessor, and
Seller, as Lessee, shall enter into the Lease and shall execute and
deliver to Title Insurer for recordation a short- form memorandum
thereof in form and substance satisfactory to Buyer and Seller, and if
applicable, as may be required by Title Insurer to issue to Lessee a
leasehold policy of title insurance on the Closing Date.
Notwithstanding the foregoing, however, in no event shall the issuance
of such leasehold policy of title insurance be deemed a condition to
Closing of Seller hereunder. In addition, Seller, as Lessee, shall
execute and deliver to Buyer, as Lessor, such Uniform Commercial Code
financing statements and/or fixture filings evidencing Lessor's
ownership of the Personal Property as shall be reasonably required by
Lessor. Such financing statements and/or fixture filings shall describe
with particularity the Personal Property, shall be in form sufficient
for recording or filing, as applicable, with the appropriate
Governmental Authority and shall be otherwise reasonably satisfactory
to Buyer, as Lessor.
(d) Seller shall deliver for itself (i) a "FIRPTA"
certificate in form and substance satisfactory to Buyer and in
conformance with Section 1445(b)(2) of the Internal Revenue Code, to
the effect that Seller is not a foreign person and (ii) such other
affidavits or certificates as may be reasonably required by Buyer to
the effect that Buyer is not required to withhold taxes from the
payment of sale proceeds to Seller under any other applicable state,
commonwealth or local tax laws.
Section 2.4 Prorations. There shall be no adjustment of taxes,
assessments, water charges, utilities, receivables or rents, if any, premiums on
existing insurance policies, if any, or any other items relating to the
Property, it being understood by the parties that Seller, as Lessee under the
Lease, shall be obligated to pay the same under the terms thereof from and after
the Closing Date.
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Section 2.5 Costs.
2.5.1 Seller's Costs. Seller shall pay:
(a) any and all state, municipal or other documentary,
transfer, stamp, sales, use or similar taxes payable in
connection with the delivery of any instrument or document
provided in or contemplated by this Agreement or the
Exhibits hereto, any agreement or commitment described or
referred to herein or the transactions contemplated herein
together with interest and penalties, if any, thereon;
(b) all expenses of or related to the issuance of the
title insurance commitment and policy (including the costs
of any survey required by Buyer and the Title Insurer),
chain of title reports, and all escrow fees and charges;
(c) the charges for or in connection with the recording
and/or filing of any instrument or document provided herein
or contemplated by this Agreement or any agreement or
document described or referred to herein;
(d) any and all broker's fees or similar fees claimed
by any party acting by or on behalf of Seller in connection
with the transactions contemplated herein;
(e) Seller's legal, accounting and other professional
fees and expenses and the cost of all instruments and
documents required to be delivered, or to be caused to be
delivered, by Seller hereunder;
(f) all of Buyer's Transaction Costs other than Buyer's
Legal Costs; and
(g) all of Buyer's Legal Costs up to $50,000.00 and
Fifty percent (50%) of Buyer's Legal Costs in excess
thereof;
(h) except as provided in Section 2.5.2, all other
costs and expenses incurred in connection with the
transactions contemplated hereunder and the Exhibits hereto.
2.5.2 Buyer's Costs. Buyer shall pay Fifty Percent (50%) of
the Buyer's Legal Costs in excess of $50,000.00.
Section 2.6 Reimbursement of Buyer's Transaction Costs.
Pursuant to the Commitment Letter, Seller or ILC on Seller's behalf has paid to
Buyer an expense reimbursement deposit of Two Hundred Thousand Dollars
($200,000) (the "Master Expense Deposit"). Of such Master Expense Deposit, the
sum of $25,000.00 (the "Allocated Expense Deposit") is allocated to the
transactions contemplated hereby and the Exhibits hereto. As
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provided in the Master Commitment Letter, if the transactions contemplated
hereunder and the Exhibits hereto do not close for any reason other than by
reason of (a) a breach or default by Seller hereunder, (b) Seller financing the
Property through another financing source or (c) Seller selling the Property to
another buyer in a transaction in which Seller or any Affiliate of Seller shall
continue to operate and/or manage the Facility following the consummation
thereof, then the Allocated Expense Deposit shall be applied against Buyer's
Transaction Costs and the balance shall be promptly refunded to Seller. If the
transactions hereunder and the Exhibits hereto (i) do not close for any of the
reasons described in clauses (a), (b) or (c) above or (ii) do close, the Buyer
shall be entitled to keep the entire Allocated Expense Deposit. If the
transactions hereunder and the Exhibits hereto do close and Buyer's Transaction
Costs are greater than the total amount of the Allocated Expense Deposit, Seller
shall reimburse Buyer for any excess costs so incurred, except as provided in
Sections 2.5.1(g) and 2.5.2 above. To the extent ascertainable on the Closing
Date, any amount due to Buyer shall be paid at the Closing. To the extent such
amounts are not so ascertainable, Seller shall thereafter reimburse Buyer
promptly following Buyer's written request therefor.
Section 2.7 Lease Commitment Fee. In addition to the Allocated
Expense Deposit which Buyer hereby acknowledges receipt of, on the Closing Date,
Seller shall pay to Buyer via wire transfer of immediately available funds (or
such other method as is acceptable to Buyer and Seller) the Lease Commitment Fee
and the same shall be deemed fully earned by Buyer and non-refundable so long as
the Closing has occurred.
Section 2.8 Nature of Buyer's Interest. Buyer is only
purchasing the Property and is acquiring no interest, other than as a lessor
pursuant to the Lease (and including any security interest granted pursuant
thereto), in the trade or business operated or to be operated by Seller with
respect to the Property.
ARTICLE 3
CONDITIONS TO THE OBLIGATION OF BUYER TO CLOSE
The obligations of Buyer hereunder are subject to the
satisfaction or waiver by Buyer of the following conditions. Should any
condition set forth in this Article 3 not be fulfilled or waived on the Closing
Date to the satisfaction of Buyer, Buyer shall, at its option, without waiving
any rights provided in this Agreement, be relieved of all obligations hereunder,
except for Buyer's obligations with respect to the Allocated Expense Deposit as
provided in Section 2.6 above.
Section 3.1 Performance. Seller shall have performed each and
all of the covenants and obligations required to be performed by them on or
prior to the Closing.
Section 3.2 Representations and Warranties. Each and all of
the representations and warranties of Seller hereunder shall be true and correct
on and as of the Closing Date, as though given as of the Closing Date, and
Seller shall have delivered to Buyer officers' certificates to that effect.
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Section 3.3 Default. No event shall have occurred that would
constitute a default by (a) Seller, as Lessee under the Lease, or (b) Guarantor
under the Guaranty, or which with notice or the lapse of time, or both, would
constitute such a default by either Seller under the Lease or Guarantor under
the Guaranty.
Section 3.4 Recordation and Costs. Seller shall (a) have made
arrangements for the Deed as well as the short-form memorandum of the Lease and
the Uniform Commercial Code financing statements and/or fixture filings, to be
recorded or filed for recordation in the manner required by the laws of the
State, and (b) pay, or arrange to be paid, all costs and fees to be paid by
Buyer pursuant to Section 2.5 and the Lease Commitment Fee pursuant to Section
2.7, and such arrangements shall be reasonably satisfactory to Buyer and its
counsel in all respects.
Section 3.5 Title Insurance. Buyer shall have received, at
Seller's expense, a commitment from Title Insurer satisfactory to Buyer and its
counsel for a policy of title insurance showing good and indefeasible title to
the Property in fee simple vested in Buyer as of the Closing, subject only to
the Permitted Encumbrances. Such policy (the "Title Policy"), when issued,
shall:
(a) be in current ALTA extended coverage owner's form
(but without a general exception for creditors' rights);
(b) be issued in an amount equal to the Purchase Price;
(c) include endorsements 100 (no violations, etc.,
modified for an owner), 103.7 (access), 116.1 (survey
accuracy), 123.2 (zoning-improved property), or the
equivalents thereof available, if at all, in the State, and
such other endorsements as Buyer may reasonably require; and
(d) insure (i) that any conditions, covenants and
restrictions affecting the Property have not been violated
and that a future violation thereof will not result in a
forfeiture or reversion of title; (ii) if obtainable, that
all streets adjoining the Property have been completed,
dedicated and accepted for public maintenance and use by the
appropriate governmental authorities and that the Property
has access to public streets; (iii) that local zoning
ordinances, general plans and all other applicable land use
regulations and all private covenants, conditions and
restrictions, if any, permit the transfer and use of the
Property (and reconstruction and resumption of use of the
Property in the event of damage or destruction thereof or
cessation of use thereof) for all uses contemplated by the
Lease as a matter of right for an unlimited time period, and
specifically not merely as a legal non-conforming use or any
other legal status which would by its terms or by operation
of law limit the duration of such use or the right to
rebuild and resume use of the Property for all uses
contemplated by the Lease in the event of damage,
destruction or cessation of use of the Property for any
reason; and (iv) over and against all parties in possession
except the current occupants thereof.
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Section 3.6 Survey. Buyer shall have received, at Seller's
expense, and approved either (a) a final "as-built" ALTA survey of the Property
completed in accordance with the Minimum Standard Detail requirements for
ALTA/ACSM Land Title Surveys, with additional Title A survey requirements,
jointly established and adopted by ALTA and ACSM in 1992 that meet the
requirements of a Class A Survey as defined therein, certified within thirty
(30) days of the Closing Date or (b) such other form of title survey which is in
form and substance satisfactory to Buyer in its sole discretion. Such survey
shall (i) be certified to Buyer and the Title Insurer as being true and
accurate, which such certification shall include the acreage of the Property and
a statement as to whether the Property is located in a Flood Hazard Area; (ii)
identify thereon all telephone, water, sewage, electricity, gas and other
utility facilities to the points of connection; and (iii) show no encroachments
onto or conflicts with any adjacent property other than pursuant to easements
appurtenant to the Property or such other agreements with the affected landowner
approved by Buyer and which are, in turn, insured under the Title Policy.
Section 3.7 Utilities and Access. Buyer shall have satisfied
itself that (a) all utilities serving the Property are adequate for the Primary
Intended Use of the Facility; and (b) all means of ingress and egress, parking,
access to public streets and drainage facilities are or will be available to the
Property and are adequate for the Primary Intended Use of the Facility.
Section 3.8 Site Visits. Buyer shall have completed
satisfactory site visits of the Property.
Section 3.9 Environmental Report. Buyer shall have received,
at Seller's expense, a written report issued to Buyer from a qualified
geotechnical or engineering firm reasonably acceptable to Buyer and in form and
substance reasonably satisfactory to Buyer, concerning the presence, handling,
treatment and disposal of Hazardous Substances on, in or under the Property and
disclosing (a) the results of a review of prior uses of the Property disclosed
by local public records, including a chain of title report from the Title
Insurer, in form and substance satisfactory to Buyer, showing all previous
owners and lessees of the Property from 1940 to the present; (b) contacts with
local officials to determine whether any records exist with respect to the
disposal of Hazardous Substances on the Property; (c) if recommended by such
engineering or geotechnical firm or required by Buyer, soil samples and
groundwater samples consistent with good engineering practice; and (d)
reasonable evaluations of the surrounding areas for sensitive environmental
receptors such as drinking water xxxxx or aquifers, hospitals and schools, and
evidence regarding the use and/or historical use of such areas.
Section 3.10 Entitlements. Buyer shall have received and
approved with respect to the Property copies of (a) the applicable zoning
ordinances and map marked to show the location of such Property and, if
available, certified by an appropriate Governmental Authority to be complete and
accurate; (b) evidence that such zoning ordinances and the general
plans/specific plans and all other land use regulations of the applicable
municipal jurisdictions and all covenants, conditions and restrictions, if any,
affecting the Property permit the transfer of the Property and use thereof for
its Primary Intended Use and for all other uses (if any) contemplated under the
Lease (and reconstruction and resumption of use in the event of damage,
destruction, or cessation of use) as a matter of right for an unlimited time
period and not merely
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as a legal non-conforming use; (c) all licenses, certificates, approvals and
authorizations, including plot plan and subdivision approvals, zoning variances,
sewer, building, foundation, grading and other permits and all other
authorizations required by Governmental Authorities or by any applicable
covenants, conditions and restrictions for the use and operation of such
Property for its Primary Intended Use and for all other uses (if any)
contemplated under the Lease, in each instance in accordance with all applicable
Governmental Requirements; and (d) evidence satisfactory to it that (i) the
Property and/or Lessee holds all licenses, permits, accreditations,
authorizations and certifications required for the operation of the Property for
its Primary Intended Use and for all other uses (if any) contemplated under the
Lease, including from the State of Florida Agency for Health Care Administration
and any other applicable Governmental Authorities; (ii) the Property is not
subject to, or threatened with, any hold on admissions or other sanction and
there are no outstanding, or threatened, notices of deficiency resulting from
any survey of the Property which have not been fully responded to with an
acceptable plan of correction with which the Property is being operated in
compliance; (iii) to the extent necessary to operate the Property for its
Primary Intended Use and to receive governmental and/or private payor
reimbursements, the Property is fully and unconditionally accredited by the
Joint Commission on Accreditation of Health Care Organizations; and (iv) the
Property is, to the extent applicable, (A) duly certified as a provider under
the Medicare and Medicaid programs and (B) in compliance in all material
respects with all Governmental Requirements, including rules and regulations
relating to Medicare/Medicaid fraud and abuse practices, and all insurance
requirements.
Section 3.11 Physical Inspections. Buyer shall have received
and approved the physical condition of the Property including the improvements
and the HVAC, electrical, plumbing and other systems, and shall have received,
at Seller's expense, written reports in form and substance reasonably
satisfactory to Buyer from one or more qualified engineering firms reasonably
approved by Buyer or any engineer employed by Buyer to the effect that the
improvements on each Property have been constructed in compliance with, and
currently are in compliance with, all Governmental Requirements, including the
Americans With Disabilities Act, and with all restrictions of record applicable
thereto which affect the use of such Property for its Primary Intended Use and
for all other uses (if any) contemplated under the Lease.
Section 3.12 Condemnation; Casualty. Except as set forth on
Schedule 2, no Condemnation shall be pending or threatened with respect to the
Property and no casualty shall have occurred with respect to the Property or any
portion thereof.
Section 3.13 Financial Condition.
3.13.1 Buyer shall have received and approved (a) audited
financial statements for Seller for the period ended June 30, 1996; (b) audited
financial statements for ILC for the period ended December 31, 1995, and
unaudited financial statements for such entities for the period ended June 30,
1996; and (c) unaudited operating statements for the Facility for the period
ended July 31, 1996 (if any);
12
3.13.2 Buyer shall have received evidence satisfactory to it
that no material adverse change in the financial condition, business, or
prospects of (a) Seller or ILC has occurred from June 30, 1996 through the
Closing or (b) the Facility has occurred from August 1, 1996 through the
Closing;
3.13.3 Buyer shall have received and approved UCC searches
against Seller showing no liens on the Property;
3.13.4 Buyer shall have received and approved all pending or
threatened litigation or governmental proceedings seeking to enjoin, challenge
or collect material damages in connection with Seller or the Property.
Section 3.14 Proceedings. Buyer shall have reviewed and
reasonably approved all corporate, partnership, limited liability company or
other proceedings necessary or required to be taken by Seller in connection with
the transactions contemplated hereunder and the Exhibits hereto and all
documents and certificates incident thereto, including the Organizational
Documents of Seller and such other documents and certificates as Buyer or its
counsel shall reasonably request.
Section 3.15 Records. Buyer shall have reviewed, to the extent
in the possession and control of Seller, originals (or copies thereof certified
to Buyer) of all documents or other instruments relating to the Intangible
Property, all operating reports and such other records pertaining to the
Property as Buyer shall reasonably request.
Section 3.16 Insurance. Buyer shall have received certificates
with respect to, and copies of the policies of, the insurance required to be
carried by Lessee under the Lease, together with evidence satisfactory to Buyer
that the premiums therefor due on or prior to the Closing Date have been paid in
full.
Section 3.17 Letter(s) of Credit. Buyer shall have received
the letter or letters of credit fulfilling the requirements set forth in the
Lease.
Section 3.18 Transaction Documents. Seller shall have executed
and delivered to Buyer the Deed and two (2) counterpart originals of the Lease,
Xxxx of Sale and Assignment and Commitment Letter Amendment, together with any
other documents or instruments required hereunder, and Guarantor shall have
executed and delivered to Buyer two (2) originals of the Guaranty.
Section 3.19 Opinion of Counsel. Buyer shall have received an
opinion or opinions of counsel to Seller and Guarantor, (a) dated as of the
Closing Date, (b) addressed to Buyer and any participants of Buyer, (c)
incorporating any necessary opinions from local counsel to Seller and Guarantor
and (d) subject only to such qualifications and limitations as may be reasonably
approved by Buyer and Buyer's counsel, to the effect that:
3.19.1 Each of Seller and Guarantor is duly organized, validly
existing and in good standing in its state of organization/formation and is
qualified to do
13
business and in good standing in the State; the execution and delivery of this
Agreement, the other Transaction Documents and all other documents to be
executed by Seller and Guarantor, as applicable, hereunder or the Exhibits
hereto have been duly authorized; and this Agreement, the other Transaction
Documents and all other documents to be executed and delivered by Seller and/or
Guarantor, as applicable, to or for the benefit of Buyer hereunder are valid and
binding instruments, enforceable against Seller and Guarantor, as applicable, in
accordance with their respective terms;
3.19.2 the execution and delivery of this Agreement, the other
Transaction Documents and all other documents to be executed and delivered by
Seller and Guarantor, as applicable, hereunder and the consummation of the
transactions contemplated hereunder and the Exhibits hereto do not and will not
constitute an event of default under, or a violation of, any Organizational
Document of Seller and/or Guarantor, as applicable, or any Governmental
Requirement, contract or other agreement by which any of Seller and/or
Guarantor, as applicable, is or may be bound, including Governmental
Requirements applicable to the use of the Facility for its Primary Intended Use;
3.19.3 there are (a) no pending or, to the best knowledge of
such counsel, threatened, proceedings with respect to or in any manner affecting
Seller or the Property or in which Seller is or will be a party by reason of the
ownership or leasing of the Property; or (b) to the best knowledge of such
counsel, no present plans or studies by any Governmental Authority which in any
way challenge, affect or would challenge or affect in a material and adverse
manner such ownership or leasing;
3.19.4 Seller has obtained all consents, permits, licenses,
approvals or authorizations from Governmental Authorities or other third parties
which are necessary to permit the conveyance of the Property in accordance with
the provisions of this Agreement and the Exhibits hereto, all of which are in
full force and effect; current local zoning ordinances, general plans and other
applicable land use regulations and all private covenants, conditions and
restrictions, if any, affecting the Property, permit the transfer of the
Property and the use of the Facility for its Primary Intended Use (and
reconstruction and resumption of use in the event of damage, destruction, or
cessation of use) as a matter of right for an unlimited time period and not
merely as a legal non- continuing use; to the best knowledge of such counsel,
and to the extent necessary to operate the Property for its Primary Intended Use
and to receive governmental and/or private payor reimbursements, the Property is
fully and unconditionally accredited by the Joint Commission of Health Care
Organizations; and the Property is (i) duly certified as a provider under the
Medicare and Medicaid programs and (ii) in compliance in all material respects
with all Governmental Requirements, including rules and regulations relating to
Medicare/Medicaid fraud and abuse practices and all insurance requirements; and
14
3.19.5 the Property is a legal lot or parcel which for all
purposes may be mortgaged, conveyed and otherwise dealt with as a separate
lot(s) or parcel(s) and is not taxed with any other property.
Section 3.20 Board of Directors Approval. All of the terms
contained in this Agreement and the Exhibits hereto shall have been ratified by
the Board of Directors or the Investment Committee of the Board of Directors of
Buyer. The Board of Directors or Investment Committee of the Board of Directors
of Buyer may require other terms and conditions when considering the financial
condition of Seller, the Facility, and other relevant matters.
Section 3.21 ACH Transfer. Buyer shall have received written
authorizations of Lessee under the Lease, in a form reasonably satisfactory to
Buyer authorizing Buyer to debit Lessee's account at an Electronic Automated
Clearing House Network ("ACH") member bank on the fifth (5th) day of each
calendar month following the Commencement Date in an amount equal to the Minimum
Rent then due under the Lease, and Buyer shall have received a voided blank
check of Lessee which shows Lessee's account number and the ACH member bank's
routing number.
Section 3.22 Tax Counsel Approval. Buyer's tax counsel for
"REIT" purposes shall have reviewed and approved the terms of this Agreement,
the other Transaction Documents and any other instrument, document or agreement
executed in connection herewith or therewith.
Section 3.23 Third-Party Transferor Agreements. If applicable,
Buyer shall have received and, to the extent any provisions thereof survived the
Closing thereunder, approved any agreement to purchase between Seller and/or its
Affiliates and any third-party transferor relating to the Property, or any
portion thereof, or the business conducted thereon.
Section 3.24 Appraisal. Buyer shall have received and approved
an appraisal of the Property from Valuation Counselors, Inc., in form and
substance reasonably satisfactory to Buyer and setting forth a value of not less
than the Purchase Price.
Section 3.25 Market Feasibility and Other Due Diligence. Buyer
shall have received and approved such market and feasibility studies with
respect to the Property as Buyer shall reasonably desire and Buyer shall be
reasonably satisfied with the completion of such other due diligence items as
are customary in a transaction of this type.
Upon the mutual execution and delivery of this Agreement by Seller and Buyer and
the payment and authorized release by Buyer of the Purchase Price to Seller, the
conditions set forth in Sections 3.1 through 3.25 above shall be deemed
satisfied.
15
ARTICLE 4
CONDITIONS TO THE OBLIGATION OF SELLER TO CLOSE
The obligations of Seller hereunder are subject to the
satisfaction or waiver by Seller of the following conditions:
Section 4.1 Performance. Buyer shall have performed each and
all of the covenants and obligations required to be performed by it on or prior
to the Closing;
Section 4.2 Representations and Warranties. Each and all of
the representations and warranties of Buyer hereunder shall be true and correct
on and as of the Closing Date, as though given as of the Closing Date; and
Section 4.3 Transaction Documents. Buyer shall have executed
and delivered to Seller two (2) counterpart originals of the Lease, Xxxx of Sale
and Assignment and Commitment Letter Amendment, together with any other
documents or instruments required hereunder.
ARTICLE 5
REPRESENTATIONS AND WARRANTIES
Section 5.1 By Seller. Seller represents and warrants on the
Closing Date as follows:
5.1.1 Seller is duly organized, validly existing and, to the
extent applicable, in good standing under the laws of its state of
organization/formation, is qualified to do business and, to the extent
applicable, in good standing in the State and has full corporate power,
authority and legal right to execute and deliver and to perform and observe the
provisions of this Agreement, the other Transaction Documents and all other
instruments provided for herein and the Exhibits hereto to which it is a party,
and otherwise carry out the transactions contemplated hereunder and thereunder;
5.1.2 this Agreement and the other Transaction Documents and
all other documents to be executed by Seller hereunder have been duly
authorized, executed and delivered by Seller, and constitute and will constitute
the valid and binding obligations of Seller enforceable against it in accordance
with their respective terms;
5.1.3 Seller is solvent, and to the Best Knowledge of Seller,
Seller (i) has timely and accurately filed all tax returns required to be filed
by it, and (ii) is not in default in the payment of any taxes levied or assessed
against it or any of its assets, or subject to any judgment, order, decree, rule
or regulation of any Governmental Authority which would, in each case or in the
aggregate, adversely
16
affect the financial condition or operations of Seller or the condition,
ownership or use for the Primary Intended Use of the Property, or the ability of
the Seller to carry out the transactions contemplated hereunder or under the
Exhibits hereto;
5.1.4 no consent, approval or other authorization of, or
registration, declaration or filing with, any Governmental Authority is required
for the due execution and delivery of this Agreement, any of the other
Transaction Documents or any other documents to be executed by Seller hereunder,
or for the performance by or the validity or enforceability thereof against
Seller, other than the recording or filing for recordation of the Deed;
5.1.5 Except as set forth on Schedule 2 hereto, there are no
actions, proceedings or investigations, including Condemnation proceedings or
tax audits, pending (as to which Seller has been served with notice), or to the
Best Knowledge of Seller, pending (as to which Seller has not been served with
notice) or threatened against or affecting Seller or the Property, seeking to
enjoin, challenge or collect damages in connection with the transactions
contemplated hereunder or under any of the other Transaction Documents or which
could reasonably be expected to materially and adversely affect the financial
condition or operations of Seller or the condition, ownership or use for the
Primary Intended Use of the Property or the ability of Seller to carry out the
transactions contemplated hereunder or thereunder, or which in any way
challenge, affect or would challenge or affect the ownership of the Property or
lease of the Facility pursuant to this Agreement or the Lease;
5.1.6 the execution and delivery of this Agreement, the other
Transaction Documents and all other documents to be executed by Seller
hereunder, compliance with the provisions hereof and thereof and the
consummation of the transactions contemplated hereunder and thereunder will not
result in (a) a breach or violation of (i) to the Best Knowledge of Seller, any
Governmental Requirement applicable to Seller or the Property now in effect;
(ii) the Organizational Documents of Seller; (iii) any judgment, order or decree
of any Governmental Authority binding upon Seller; or (iv) any agreement or
instrument to which Seller is a party or by which it is bound; (b) the
acceleration of any obligation of Seller; or (c) to the Best Knowledge of
Seller, the creation of any lien, encumbrance or other matter affecting title
(other than the Lease and the Permitted Encumbrances) to the Property;
5.1.7 to the Best Knowledge of Seller, current local zoning
ordinances, general plans and other applicable land use regulations and all
private covenants, conditions and restrictions, if any, affecting the Property,
permit the transfer of the Property and the use of the Facility for its Primary
Intended Use (and reconstruction and resumption of use in the event of damage,
destruction, or cessation of use) as a matter of right for an unlimited time
period and not merely as a legal non-conforming use;
17
5.1.8 Seller has obtained all consents, permits, licenses
approvals or authorizations from Governmental Authorities or other third parties
which are necessary to permit the conveyance of the Property in accordance with
the provisions of this Agreement and the use of the Property by Lessee for its
Primary Intended Use, all of which are in full force and effect, and to the Best
Knowledge of Seller, the Property is in compliance with all applicable zoning
ordinances and the Permitted Exceptions;
5.1.9 to the Best Knowledge of Seller, the Facility is in
compliance in all material respects with all Governmental Requirements and all
insurance requirements;
5.1.10 except as set forth on Schedule 2, no casualty has
occurred with respect to the Property or any portion thereof;
5.1.11 to the Best Knowledge of Seller, (a) there are no
underground tanks or Hazardous Substances currently located on the Property and
no such tanks have ever been located on the Property and no Hazardous Substances
have ever been present, used, stored, treated, released from or disposed of or
on the Property; (b) no enforcement, cleanup, removal or other governmental or
regulatory actions have, at any time, been instituted or threatened with respect
to the Property; (c) there is no current or prior violation or state of
noncompliance with any environmental law relating to Hazardous Substances with
respect to the Property; (d) no claims have been made or threatened by any third
party with respect to the Property relating to damage, contribution, cost
recovery, compensation, loss or injury resulting from or related to any
Hazardous Substance; and (e) there are no current and there have been no prior
businesses engaged in the storage, treatment or disposal of Hazardous Substances
on any property adjacent to the Property;
5.1.12 to the Best Knowledge of Seller, the Property is not
located within an area of special risk with respect to natural or man-made
disasters or hazards, including any Flood Hazard Area;
5.1.13 to the Best Knowledge of Seller, there are no adverse
geological or soil conditions affecting the Property;
5.1.14 to the Best Knowledge of Seller, (a) all public
utilities, including telephone, gas, electric power, sanitary and storm sewer
and water, are available for connection at the boundaries of the Property; (b)
such utilities are adequate for the Primary Intended Use of the Facility; and
(c) the means of ingress and egress, parking, access to public streets and
drainage facilities are adequate for the Primary Intended Use of the Facility;
18
5.1.15 to the Best Knowledge of Seller, the Property is a
legal lot(s) or parcel(s) which for all purposes may be mortgaged, conveyed and
otherwise dealt with as a separate legal lot(s) or parcel(s) and is not taxed
with any other property;
5.1.16 no exception to title to and no interest in the
Property known to Seller will materially interfere with the use of the Leased
Property for its Primary Intended Use in accordance with the Lease;
5.1.17 Seller has delivered to Buyer copies of (a) the
unaudited financial statements for Seller for the period ended June 30, 1996,
(b) the audited financial statements for each of ILC for the period ended
December 31, 1995 and the unaudited financial statements for such entities for
the period ended June 30, 1996 and (c) the operating statements for the Facility
for the period ended July 31, 1996, and such financial and/or operating
statements are true, correct and complete in all material respects, have been
prepared from and in accordance with the books and records of Seller, ILC and
the Facility, as applicable, and fairly present the financial position and
results of operations of Seller, ILC and the Facility, respectively, at the
date(s) and for the period(s) indicated;
5.1.18 since June 30, 1996, there has been no material adverse
change in the financial condition of Seller or ILC and since August 1, 1996,
there has been no material adverse change in the financial condition of the
Facility from that disclosed in the operating statements;
5.1.19 Seller has delivered to Buyer copies of all of the
Organizational Documents of Seller and ILC. Such Organizational Documents are
true, correct and complete in all material respects;
5.1.20 to the Best Knowledge of Seller, neither this Agreement
nor any certificate, statement or other document furnished or to be furnished to
Buyer by Seller in connection with the transactions contemplated hereunder and
under the Exhibits hereto contains or will contain any untrue statement of a
material fact or omits or will omit to state a material fact necessary in order
to make the statements contained herein or therein not misleading;
5.1.21 Buyer is not required to withhold taxes from the
payment of sale proceeds to Seller under the Internal Revenue Code or any
applicable state, commonwealth or local tax laws;
5.1.22 Seller is not a foreign person for purposes of Section
1445 of the Internal Revenue Code;
5.1.23 [Reserved];
19
5.1.24 Neither Seller nor any Affiliate of Seller or ILC is
retaining any contiguous or adjacent property to the Property; and
5.1.25 to the Best Knowledge of Seller, the real property tax
accessors' parcel number for the Facility is 60544.001512.
Section 5.2 By Buyer. Buyer represents and warrants on the
Closing Date as follows:
5.2.1 Buyer is duly organized, validly existing and, to the
extent applicable, in good standing under the laws of the state of its
organization/formation; is, or will be on the Closing Date, duly qualified and
authorized to do business in the State, to the extent such qualification is
required to perform its obligations hereunder or under any Transaction Document;
and has full corporate power, authority and legal right to execute and deliver
and to perform and observe the provisions of this Agreement, the Lease and all
other instruments provided for herein to which it is a party, and otherwise
carry out the transactions contemplated hereunder and the Exhibits hereto;
5.2.2 this Agreement and all other documents to be delivered
by Buyer pursuant to this Agreement have been duly authorized, executed and
delivered by Buyer and constitute, and will constitute, the valid and binding
obligations of Buyer, enforceable against Buyer in accordance with their
respective terms;
5.2.3 no consent, approval or other authorization of, or
registration, declaration or filing with, any Governmental Authority is required
for the due execution and delivery of this Agreement, any of the other
Transaction Documents or any other documents to be executed by Buyer hereunder,
or for the performance by or the validity or enforceability thereof against
Buyer, other than the recording or filing for recordation of the Deed; and
5.2.4 the execution and delivery of this Agreement and any
other Transaction Documents by Buyer and the execution and delivery of all other
documents to be executed by Buyer hereunder, compliance with the provisions
hereof and thereof and the consummation of the transactions contemplated
hereunder and thereunder will not result in (a) to the Best Knowledge of Buyer,
a breach or violation of (i) any Governmental Requirement applicable to Buyer
now in effect; (ii) the Organizational Documents of Buyer; (iii) any judgment,
order or decree of any Governmental Authority binding upon Buyer; or (iv) any
agreement or instrument to which Buyer is a party or by which it is bound; (b)
the acceleration of any obligation of Buyer; or (c) to the Best Knowledge of
Buyer, the creation of any lien, encumbrance or other matter affecting title
(other than the Lease and the Permitted Encumbrances) to the Property.
20
ARTICLE 6
COVENANTS OF THE PARTIES AND OTHER MATTERS
Section 6.1 Covenants of Seller. For the period from June 1,
1996 through and including the Closing Date, Seller shall (and, as applicable,
Seller represents and warrants that it has):
(a) not dispose(d) of or encumber(ed) or permit(xxx) the
disposition or encumbrance of the Property or any portion thereof
except as would be permitted (if at all) under the Lease if the same
were in effect;
(b) not enter(ed) into or assume(d) or permit(xxx) to be entered
into or assumed any contract, agreement, obligation, lease, license or
commitment related to the Property except in the ordinary course of
business or as contemplated herein or in the other Transaction
Documents;
(c) not do (done) any act or omit(xxx to do) any act which would
cause a breach of any contract, commitment or obligation which would
have a materially adverse effect on the ownership of the Property or
the use thereof for the Primary Intended Use; and
(d) not make (made) or permit(xxx) to be made any Capital
Additions (as defined in the Lease) to the Property without the
written approval of Buyer, other than renovations to the Facility
which have been disclosed to Buyer and which are to be completed prior
to the Closing Date.
Section 6.2 Indemnification.
(a) In addition to, and without limiting any indemnification
obligation of Seller, as Lessee, under the Lease, Seller
unconditionally and irrevocably indemnifies, protects and agrees to
defend and hold harmless Buyer and Buyer's officers, directors,
employees, agents and contractors from and against any and all loss,
cost or expense, including reasonable attorneys' fees and costs,
arising from (i) the breach or violation of any representation or
warranty of Seller contained herein; or (ii) the failure of Seller to
satisfy or perform any covenant or other provision contained herein on
its part to be satisfied or performed. Payment shall not be a
condition precedent to recovery under the foregoing indemnification
provision.
(b) Buyer hereby unconditionally and irrevocably indemnifies,
protects and agrees to defend and hold harmless Seller and Seller's
members, officers, directors, employees, agents and contractors from
and against any and all loss, cost or expense, including reasonable
attorneys' fees and costs, arising from (i) the breach or violation of
any representation or warranty of Buyer contained herein; or (ii) the
failure of Buyer to satisfy or perform any covenant or other provision
contained herein on its part to be
21
satisfied or performed. Payment shall not be a condition precedent to
recovery under the foregoing indemnification provision.
(c) Notwithstanding anything to the contrary in this Agreement,
if any specific knowledge actually comes to the attention of either
Seller or Buyer prior to the Closing, whether through the other party
hereto or due to such party's own investigations, which knowledge
would negate or make untrue any express representations and warranties
of the other party hereunder, then such specific knowledge shall be
deemed to limit such representations and warranties so as to reduce or
eliminate any liability which such other party may otherwise have had
as a result of the specific breach thereof. For purposes of the
foregoing, no information, matter or item shall be deemed to have
"come to the attention" of a party hereto, unless such information,
matter or item is actually known or under reasonable circumstances
should have been known by an officer or director of such party. In
other words, in no event shall knowledge be imputed to a party simply
because specific knowledge may have "come to the attention" of a
party's agent, consultant or other employee, unless and to the extent
the same is actually known or under reasonable circumstances should
have been known by an officer or director of such party.
ARTICLE 7
MISCELLANEOUS
Section 7.1 Survival; Breach of Representations and
Warranties. The covenants, representations and warranties made by Seller and
Buyer hereunder or in any certificates or other instruments delivered pursuant
to this Agreement shall survive the execution and delivery of this Agreement and
recordation of the Deed provided that (a) with respect to the representations
and warranties of Seller pursuant to Sections 5.1.1, 5.1.2 and 5.1.3 and Buyer
pursuant to Sections 5.2.1 and 5.2.2, for the applicable statute of limitations,
(b) with respect to the representations and warranties of Seller set forth in
Section 5.1.11, for a period of forty-eight (48) months following the date of
Closing, and (c) with respect to any other representation, warranty or covenant
of either Seller or Buyer hereunder or in any certificates or other instruments
delivered pursuant to this Agreement (other than the Transaction Documents), for
a period of twenty-four (24) months from the date of Closing. The foregoing
limitation on the survival of the representations, warranties and covenants of
Seller hereunder shall in no way be deemed to affect or limit Seller's
obligations as Lessee under the Lease or the obligations of Seller and/or
Guarantor under the other Transaction Documents. Neither Seller nor Buyer shall
be in breach or default of any covenant, representation or warranty of such
party hereunder unless such covenant remains unperformed or such representation
or warranty remains untrue and uncured for thirty (30) days after written notice
thereof from the other party; provided, however, that if the nature of such
covenant or representation or warranty is such that the same cannot be performed
and/or cured with due diligence in such thirty (30) day period, then the party
obligated to perform such covenant or to cure such representation or warranty
shall not be in breach or default hereunder if such party proceeds promptly and
with due diligence to cure the same and diligently completes the cure thereof.
22
Section 7.2 Brokers. Buyer and Seller each represents and
warrants to the other that it has not dealt with any broker, finder or similar
agent on account of any of the transactions contemplated hereunder and under the
Exhibits hereto and each agrees to indemnify, defend, protect and hold harmless
the other from and against any claims, causes of action or the like brought
against the other, by any broker, finder or similar agent for a commission or
fee on account of the transactions contemplated hereunder and under the Exhibits
hereto resulting from their respective acts.
Section 7.3 Notices. Any notice, consent, approval, demand or
other communication required or permitted to be given hereunder (a "notice")
must be in writing and may be served personally or by U.S. Mail. If served by
U.S. Mail, it shall be addressed as follows:
If to Buyer: Health Care Property Investors, Inc.
00000 Xxxxxxxx Xxxxxxxxx
Xxxxx 0000
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Phone: (000) 000-0000
Fax: (000) 000-0000
Attn: Legal Department
with a copy to: Xxxxxx & Xxxxxxx
000 Xxxx Xxxxx Xxxxxx, Xxxxx 0000
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Phone: (000) 000-0000
Fax: (000) 000-0000
Attn: Xxxxx X. Xxxx, Esq.
If to Seller: Integrated Living Communities at Cabot Pointe, Inc.
0000 Xxx 00 Xxxx
Xxxxxx Xxxxxxx, Xxxxxxx 00000
Phone: (000) 000-0000
Fax: (000) 000-0000
Attn: President and CEO
with copies to: Integrated Living Communities at Cabot Pointe, Inc.
0000 Xxx 00 Xxxx
Xxxxxx Xxxxxxx, Xxxxxxx 00000
Phone: (000) 000-0000
Fax: (000) 000-0000
Attn: General Counsel
23
and Xxxxxx Xxxxxx Flattau & Klimpl, LLP
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Phone: (000) 000-0000
Fax: (000) 000-0000
Attn: Xxxxxx Paretts Xxxxxx, Esq.
Any notice which is personally served shall be effective upon the date of
service; any notice given by U.S. Mail shall be deemed effectively given, if
deposited in the United States Mail, registered or certified with return receipt
requested, postage prepaid and addressed as provided above, on the date of
receipt, refusal or non-delivery indicated on the return receipt. In addition,
either party may send notices by a nationally recognized overnight courier
service which provides written proof of delivery (such as U.P.S. or Federal
Express). Any notice sent by a nationally recognized overnight courier shall be
effective on the date of delivery to the party at its address specified above as
set forth in the courier's delivery receipt. Either party may, by notice to the
other from time to time in the manner herein provided, specify a different
address for notice purposes. The foregoing facsimile numbers are for convenience
only. Notice by facsimile shall not be deemed an effective manner of giving
notice for purposes of this Agreement.
Section 7.4 Attorneys' Fees. If Buyer or Seller brings an
action at law or other proceeding against the others to enforce any of the
terms, covenants or conditions hereof or any instrument executed pursuant to
this Agreement, or by reason of any breach or default hereunder or thereunder,
the party prevailing in any such action or proceeding and any appeal thereupon
shall be paid all of its costs and reasonable attorneys' fees.
Section 7.5 Successors. This Agreement shall be binding upon
Buyer, Seller and their respective successors and assigns. Notwithstanding the
foregoing, the rights and obligations of Seller and Buyer under this Agreement
may not be assigned without the prior written consent of the other party, which
consent may be given or withheld in the sole and absolute discretion of such
other party; provided, however, that Buyer may, however, upon written notice to
Seller, assign its rights and obligations hereunder to any transferee of Buyer's
interest in the Property following the Closing without the consent of Seller
upon written notice to Seller.
Section 7.6 Waiver. No delay in exercising any right or remedy
shall constitute a waiver thereof, and no waiver by Buyer or Seller of a breach
of any covenant of this Agreement shall be construed as a waiver of any
preceding or succeeding breach of the same or any other covenant or condition of
this Agreement.
Section 7.7 Invalidity. In the event any one or more of the
provisions contained in this Agreement shall, for any reason, be held to be
invalid, illegal or unenforceable in any respect, such invalidity, illegality or
unenforceability shall not affect any other provision of this Agreement.
24
Section 7.8 Governing Law. EXCEPT WHERE FEDERAL LAW IS
APPLICABLE AND UNLESS OTHERWISE EXPRESSLY PROVIDED HEREIN, THIS AGREEMENT SHALL
BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE.
Section 7.9 Bulk Sales. Buyer and Seller hereby waive
compliance with the notice provisions of any bulk sales statute in effect in the
State. Seller shall indemnify, defend, protect and hold harmless Buyer from and
against any and all claims, losses, damages, liabilities, costs and expenses
(including reasonable legal fees and expenses) paid or incurred by Buyer and
arising directly or indirectly out of noncompliance with bulk sales statutes.
Section 7.10 Counterparts. This Agreement may be executed in
any number of counterparts, each of which shall be a valid and binding original,
but all of which together shall constitute one and the same instrument.
Section 7.11 Entire Agreement. This Agreement, together with
the other Transaction Documents, the Exhibits hereto and thereto and such other
documents as are contemplated hereunder or thereunder, constitute the entire
agreement of the parties in respect of the subject matter hereof, and may not be
changed or modified except by an agreement in writing signed by the parties.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed effective as of the day and year first above written.
"Buyer"
HEALTH CARE PROPERTY INVESTORS, INC.,
a Maryland corporation
By:_________________________________
Its:________________________________
"Seller"
INTEGRATED LIVING COMMUNITIES AT CABOT POINTE, INC.,
a Delaware corporation
By:_________________________________
Its:________________________________
25
EXHIBIT A
Legal Description of the Land
The Land referred to is situate in the unincorporated area of the
County of Manatee, State of Florida and is described as follows:
Begin 60 feet South of the northeast corner of Section 15,
Township 35 South, Range 17 East, and run thence West along the South line of
Road Right of Way a distance of 2310 feet; thence run South parallel to the East
line of 00xx Xxxxxx a distance of 417 feet for Point of Beginning; thence
continue in the same direction a distance of 238.91 feet; thence West 308.12
feet more or less to the East line of 00xx Xxxxxx; thence North along the East
line of 00xx Xxxxxx distance of 239.41 feet; thence East Parallel to the South
line of the property hereby conveyed a distance of 308.12 feet more or less to
the Point of beginning, said property lying in and being in Manatee County,
Florida; LESS AND EXCEPT the Westerly 17.00 feet thereof as disclosed in the
Warranty Deed dated June 12, 1996, recorded July 3, 1996 in O.R. Book 1491, Page
6630, Manatee County, Records.
EXHIBIT B
Form of Xxxx of Sale and Assignment
[See Attached]
EXHIBIT C
Form of Lease
[See Attached]
EXHIBIT D
Form of Guaranty
[See Attached]
EXHIBIT E
Itemized List of Personal Property
1. BEDROOM
QUAN UNIT DESCRIPTION
---- ---- -----------
54 ea Table Lamp
54 ea 3/3 Headboard, Wood
54 ea 3/3 Bedframe
54 ea 3/3x76 Health Care Mattress & Box Spring
54 ea 3-Dr. Chest
54 ea Nightstand
54 ea Upholstered Wing Chair
2. DINING AREAS
QUAN UNIT DESCRIPTION
---- ---- -----------
11 ea Dining Table Top, 36x36, bullnose wood edge and Black
Wrinkle Tilt Top Table Base
1 ea Conference/Dining table 48x86, with two bases
1 ea 60" Diameter Table and table base, same finish
30 ea Dining chair, finish Valley Oak, Brittany upholstery
30 ea Dining chair, finish Valley Oak, Wisteria upholstery
1 ea Framed Xxxxx Print at Waitress Station
2 ea Framed Lea Prints at Water Fountain
2 ea Framed Monet Prints in Private Dining Room
1 ea Potted Silk Plant in Private Dining Room
1 lot Drapery & hardware in Private Dining Room
E-1
3. PUBLIC AREAS
QUAN UNIT DESCRIPTION
---- ---- -----------
3 ea Planter Divider 72x18x60H, with Silk Plants in Tray
3 ea Column Pedestal 12x12x38H with silk floral arrangements on top
of columns
1 ea Trough Planter at entrance, 6' long, laminated with Floral
Arrangements in pots
7 ea Tub Chair, Blue
7 ea Tub Chair, Lilac
3 xx Xxxxxxxxxxx Sofa, Print Fabric
3 xx Xxxxxxxxxxx Sofa, Blue Fabric
4 xx Xxxx Chair, Brittany Upholstery
6 ea Upholstered Chair, Upholster Radical Blue
6 ea Lamp Table, medium oak
3 ea Cocktail Table, medium oak
1 ea Sofa Table 48x20x28H, medium oak
1 ea Framed Angel Irises at Entrance
2 ea Framed Xxxxxx Prints on South Wall
2 ea Potted silk plants
4. OFFICES
QUAN UNIT DESCRIPTION
---- ---- -----------
1 xx Xxxx Exec Desk 72x36, double ped, medium oak
1 ea Console with double ped and keyboard drawer
1 ea Desk chair with arms
E-2
4. OFFICES (CONTINUED)
QUAN UNIT DESCRIPTION
---- ---- -----------
2 ea Framed Xxxxxx Prints on wall
3 ea Lounge Chair
1 ea Lamp Table, Medium Oak
1 ea Table Lamp
1 ea Brass desk lamp
1 lot Drapery and Hardware
1 ea Office chair at Nurse Station
1 ea Office Chair at Control Station
1 ea Desk, 30x60 with LH return, medium oak, in
Staff Lounge
1 ea Office Chair, in Staff lounge
1 ea Lamp Table in Staff Lounge
1 ea Table Lamp
1 ea Desk Lamp
2 ea Lounge Chair in Staff lounge
5. LANAI
QUAN UNIT DESCRIPTION
---- ---- -----------
24 ea Lounge Chair, beige with Teal upholstery
3 ea 48" Patio Table with cast stone tops
6. STAFF LOUNGE
QUAN UNIT DESCRIPTION
---- ---- -----------
15 ea Metal lockers in one unit
4 ea Staff dining chairs
4 ea Staff lounge chairs
E-3
6. STAFF LOUNGE (CONTINUED)
QUAN UNIT DESCRIPTION
---- ---- -----------
1 ea 42" laminate dining table and base
7. OFFICES
QUAN UNIT DESCRIPTION
---- ---- -----------
1 ea Office chair
1 ea L-shaped workstation with acoustic panels,
task lighting, overhead cabinet storage,
laminate worksurfaces, and two pedestals
8. ACTIVITIES DIRECTOR
QUAN UNIT DESCRIPTION
---- ---- -----------
2 ea Visitor chairs, upholstered
1 ea Table lamp
2 ea Desk lamp
9. GENERAL EQUIPMENT ASSETS
3 Vacuum Cleaners
1 Carpet Extractor
1 Wet and Dry Vac
Electric Drill
Alumin Shed
Clocks
Lock A/C Covers
TV and Stand
Window Tint
70 Soap Dispensers
35 Paper Dispensers
E-4
9. GENERAL EQUIPMENT ASSETS (CONTINUED)
Waste Baskets
Handbars
Time Clock
Laundry Cart
2 Folding Carts
Linen Cart
34 Memory Boxes
Parking Signs
Overhead Table
5 Framed Evacuation Maps
2 Housekeeping Carts
Inside Signs
Outside Signs
Outside Fence
Tape Printer
2 Electric Floor Blowers
19" TV and Stand
10. STAFF LOUNGE ASSETS
20 Metal Lockers
4 Staff Dining Chairs
1 Small Dining Table
2 Lounge Chairs
1 Table Lamp
E-5
10. STAFF LOUNGE ASSETS (CONTINUED)
1 Lamp Table
Refrigerator
11. OFFICE ASSETS
A. First Office
1 Wood Exec Desk 76/36
1 Console/Drawers
1 Desk Chair
2 Lounge Chairs
Table w/Lamp
Painting/Artwork
Window Treatment
Office chair
L-shaped Work Station
Stamp Machine
Fax Machine
B. Second Office
1 30x60 Desk
Desk Chair
Desk Lamp
2 Side Chairs
l Lamp Table
1 Table Lamp
1 Canon Xerox Copier
X-0
00. OFFICE ASSETS (CONTINUED)
1 Dell Computer
1 Laser Jet Printer
Computer Stand
Filing Cabinet
12. DIETARY ASSETS
Bus Cart
4 Doz. Corning Cup 8 oz.
6 Doz. Corning 9" Plate
4 Doz. 8 oz. Bowl
4 Doz. 5 oz. Dish
4 Doz. 6" Saucer
1 Chef Knife Kit
Robot Coupe Food Processor
Microwave
Meat Slicer
Mixer
Toaster
Light Board
Oak Serving Cart
FVT Dining Room Dishware
E-7
EXHIBIT F
Commitment Letter Amendment
[See Attached]
SCHEDULE 1
Permitted Encumbrances
1. Easement granted to Florida Power & Light Company, from Xxxxxxx X. Xxxxx,
dated March 21, 1996, recorded March 21, 1996 in O.R. Book 1462, Page 7583,
Manatee County Records.
SCHEDULE 2
Disclosure Schedule
None.
TABLE OF CONTENTS
Page
ARTICLE 1 DEFINITIONS............................................................................... 1
ARTICLE 2 TERMS OF THE SALE AND LEASEBACK........................................................... 6
Section 2.1 Sale...................................................................................... 6
Section 2.2 Closing................................................................................... 6
Section 2.3 Conveyance................................................................................ 6
Section 2.4 Prorations................................................................................ 7
Section 2.5 Costs..................................................................................... 8
Section 2.6 Reimbursement of Buyer's Transaction Costs................................................ 8
Section 2.7 Lease Commitment Fee...................................................................... 9
Section 2.8 Nature of Buyer's Interest................................................................ 9
ARTICLE 3 CONDITIONS TO THE OBLIGATION OF BUYER TO CLOSE............................................ 9
Section 3.1 Performance............................................................................... 9
Section 3.2 Representations and Warranties............................................................ 9
Section 3.3 Default................................................................................... 10
Section 3.4 Recordation and Costs..................................................................... 10
Section 3.5 Title Insurance........................................................................... 10
Section 3.6 Survey.................................................................................... 11
Section 3.7 Utilities and Access...................................................................... 11
Section 3.8 Site Visits............................................................................... 11
Section 3.9 Environmental Report...................................................................... 11
Section 3.10 Entitlements.............................................................................. 11
Section 3.11 Physical Inspections...................................................................... 12
Section 3.12 Condemnation; Casualty.................................................................... 12
Section 3.13 Financial Condition....................................................................... 12
Section 3.14 Proceedings............................................................................... 13
Section 3.15 Records................................................................................... 13
Section 3.16 Insurance................................................................................. 13
Section 3.17 Letter(s) of Credit....................................................................... 13
Section 3.18 Transaction Documents..................................................................... 13
Section 3.19 Opinion of Counsel........................................................................ 13
Section 3.20 Board of Directors Approval............................................................... 15
Section 3.21 ACH Transfer.............................................................................. 15
Section 3.22 Tax Counsel Approval...................................................................... 15
Section 3.24 Appraisal................................................................................. 15
Section 3.25 Market Feasibility and Other Due Diligence................................................ 15
ARTICLE 4 CONDITIONS TO THE OBLIGATION OF SELLER TO CLOSE........................................... 16
Section 4.1 Performance............................................................................... 16
Section 4.2 Representations and Warranties............................................................ 16
i
Page
Section 4.3 Transaction Documents..................................................................... 16
ARTICLE 5 REPRESENTATIONS AND WARRANTIES............................................................ 16
Section 5.1 By Seller................................................................................. 16
Section 5.2 By Buyer.................................................................................. 20
ARTICLE 6 COVENANTS OF THE PARTIES AND OTHER MATTERS................................................ 21
Section 6.1 Covenants of Seller....................................................................... 21
Section 6.2 Indemnification........................................................................... 21
ARTICLE 7 MISCELLANEOUS............................................................................. 22
Section 7.1 Survival; Breach of Representations and Warranties........................................ 22
Section 7.2 Brokers................................................................................... 23
Section 7.3 Notices................................................................................... 23
Section 7.4 Attorneys' Fees........................................................................... 24
Section 7.5 Successors................................................................................ 24
Section 7.6 Waiver.................................................................................... 24
Section 7.7 Invalidity................................................................................ 24
Section 7.8 Governing Law............................................................................. 25
Section 7.9 Bulk Sales................................................................................ 25
Section 7.10 Counterparts.............................................................................. 25
Section 7.11 Entire Agreement.......................................................................... 25
EXHIBITS
Exhibit A - Legal Description of the Land Exhibit B - Form of Xxxx of Sale and
Assignment Exhibit C - Lease Exhibit D - Guaranty Exhibit E - Itemized List of
Personal Property Exhibit F - Commitment Letter Amendment
SCHEDULES
Schedule 1 - List of Permitted Encumbrances
Schedule 2 - Disclosure Schedule
ii
