5
ASSIGNMENT AND ASSUMPTION OF LEASE AGREEMENT
(WITH CONSENT)
(XXXXXXXX PLACE AT OAKWELL FARMS)
Dated as of December 31, 2003
HB-ESC V, L.P., a Washington limited partnership ("Assignor"), ESC IV, L.P., a
Washington limited partnership, doing business in Texas as Texas-ESC IV, L.P.
("Assignee"), EMERITUS CORPORATION, a Washington corporation ("Emeritus"),
XXXXXX X. XXXX, an individual resident of the State of Washington ("Existing
Guarantor"), and HR ACQUISITION OF SAN ANTONIO, LTD., an Alabama limited
partnership, formerly known as Capstone Capital of San Antonio, Ltd., d/b/a
Cahaba of San Antonio, Ltd. ("Lessor"), agree as follows:
1. PRELIMINARY STATEMENTS. Lessor and Integrated Living Communities of
Oakwell, L.P, a Delaware limited partnership ("Original Lessee") (successor by
conversion to Integrated Living Communities of Oakwell, Inc., a Delaware
corporation) entered into that certain Lease Agreement dated as of December 31,
1996, which was amended by that certain First Amendment to Lease Agreement dated
as of December 1, 1997, and which was further amended by that certain Second
Amendment to Lease Agreement dated as of May 9, 2002 (as amended, the "Lease"),
whereby Lessor agreed to lease to Original Lessee, and Original Lessee agreed to
lease from Lessor, that certain assisted living facility located at 0000 Xxxxxxx
Xxxxx, Xxx Xxxxxxx, Xxxxx 00000, as more particularly described and defined in
the Lease (the "Leased Property"). A copy of the Lease is attached hereto as
Exhibit "A". The Lease was assigned to Assignor by Original Lessee pursuant to
that certain Assignment and Assumption of Lease Agreement (With Consent) dated
as of May 9, 2002. Existing Guarantor executed a Guaranty of Payment and
Performance dated May 9, 2002 ("Existing Guaranty"), in favor of Lessor,
guaranteeing Assignor's obligations under the Lease. Assignor now desires to
assign to Assignee, and Assignee desires to accept the assignment of, any right,
title or interest Assignor has in and to the Leased Property as lessee under the
Lease, and Assignor and Assignee desire Lessor to, among other things, consent
to such assignment and to make certain other agreements and statements, all
pursuant to the terms and conditions of this Assignment and Assumption of Lease
Agreement (this "Agreement"). Emeritus is the sole shareholder of ESC X.X. XX,
INC., a Washington corporation, which is the general partner of Assignee.
Emeritus is required to make certain representations, warranties and agreements
in this Agreement as a condition precedent to the execution of this Agreement by
Lessor.
2. EFFECTIVENESS; DEFINED TERMS. Unless otherwise indicated to the
contrary, all terms and conditions of this Agreement shall be effective as of
the date first written above (the "Effective Date"). Unless defined or
otherwise indicated herein, capitalized terms used herein without definition
shall have the definitions provided therefor in the Lease.
3. ASSIGNMENT. Assignor assigns and conveys unto Assignee all of Assignor's
right, title and interest in and to the Leased Property as lessee under the
Lease, effective as of the Effective Date. Commencing on the Effective Date,
Assignee shall be primarily liable, as principal rather than as surety, for the
payment and performance of all of Assignor's obligations as lessee under the
Lease arising on or after the Effective Date.
4. ASSUMPTION. Assignee accepts said assignment from Assignor and expressly
assumes and agrees to keep and perform all of the terms of the Lease on the part
of lessee under the Lease arising on or after the Effective Date. Assignee and
Emeritus shall be and become jointly and severally liable for the payment and
performance of each obligation of the lessee under the Lease arising on or after
the Effective Date.
5. RELEASE OF ASSIGNOR/EXISTING GUARANTOR NOT RELEASED. As of the Effective
Date, Lessor for itself and for its affiliates, subsidiaries, successors and
assigns, hereby releases Assignor, and its affiliates, subsidiaries, successors,
assigns, agents and attorneys, representatives and employees, from their
respective obligations and liabilities of any kind or nature whatsoever under
the Lease (including the payment of rent and other charges) arising or accruing
on or after the Effective Date, although Assignor shall not be released from any
obligations or liabilities of any kind or nature arising or accruing prior to
the Effective Date. Existing Guarantor shall not be released from any
obligations or liability under the Existing Guaranty and shall guaranty the
obligations of Assignee under the Lease.
6. ASSIGNOR'S REPRESENTATIONS. Assignor represents to Assignee, Emeritus
and Lessor that, as of the date of this Agreement, (i) to Assignor's actual
knowledge, there is no default on the part of Lessor under the Lease; (ii) there
is no default on the part of Assignor under the Lease or event, which, with the
giving of notice or passage of time or both, would constitute an Event of
Default under the Lease; (iii) the Lease is valid and in full force and effect
and has not been modified, supplemented, or amended, nor to its actual
knowledge, has Lessor assigned its interest in the Lease; (iv) to Assignor's
actual knowledge, there are no existing or impending condemnation proceedings
which could affect the Leased Property; (v) all Impositions (as defined in the
Lease) are current and fully paid; and (vi) the amount of the current Minimum
Rent (per month) and the date through which rent has been paid for the Lease and
for the Related Leases is set forth in Exhibit "B" to this Agreement.
7. ASSIGNEE'S AND EMERITUS' REPRESENTATIONS. Assignee and Emeritus hereby
(i) acknowledge and agree that there are no offsets or defenses to payment and
performance of the obligations of Assignor and Assignee or any other party under
the Lease; and (ii) waive any defense, claim or counterclaim arising out of or
in connection with the obligations of Assignor or Assignee or any other party
under the Lease that exists as of the Effective Date (but not any defense, claim
or counterclaim that may arise in the future).
8. CONDITIONS PRECEDENT TO LESSOR'S CONSENT. The following items are
conditions precedent to Lessor's consent to the assignment of Assignor's
interest under the Lease to Assignee and must be completely satisfied prior to
the effectiveness of such assignment (Lessor's execution and unconditional
delivery to Assignor and Assignee of this Agreement shall constitute Lessor's
agreement that the Effective Date is the date first hereinabove written):
8.1 Assignor and its affiliates shall execute and deliver the following
agreements to Lessor, and shall complete and satisfy all of Lessor's conditions
precedent set forth therein:
i. the Assignment and Assumption of Lease Agreement, dated as of even date
herewith, among Assignor, Assignee and Lessor, with respect to the Lease
Agreement dated December 31, 1996, between Lessor, Integrated Living Communities
of Xxxxxxxxx, X.X., a Delaware limited partnership ("ILCH"), successor by
conversion to Integrated Living Communities of Henderson, Inc., a Delaware
corporation, as lessee, for the assisted living facility located at 0000
Xxxxxxxxxx Xxxxx, Xxxxxxxxx, Xxxxx 00000, which was amended by that certain
First Amendment to Lease Agreement dated as of December 1, 1997 and that Second
Amendment to Lease Agreement dated as of May 9, 2002, and which was previously
assigned to Assignor by that certain Assignment and Assumption of Lease
Agreement (With Consent) dated as of May 9, 2002 (as amended and assigned, the
"Xxxxxxxxx Lease");
ii. the Assignment and Assumption of Lease Agreement, dated as of even date
herewith, among Assignor, Assignee and Lessor, with respect to the Lease
Agreement dated December 31, 1996, between Lessor, Integrated Living Communities
of San Antonio, L.P., a Delaware limited partnership ("ILCSA"), successor by
conversion to Integrated Living Communities of San Antonio, Inc., a Delaware
corporation, as lessee, for the assisted living facility located at 0000 Xxxxx
Xxxx Xxxxx, Xxx Xxxxxxx, Xxxxx 00000, which was amended by that certain First
Amendment to Lease Agreement dated as of December 1, 1997 and that Second
Amendment to Lease Agreement dated as of May 9, 2002, and which was previously
assigned to Assignor by that certain Assignment and Assumption of Lease
Agreement (With Consent) dated as of May 9, 2002 (as amended and assigned, the
"Medical Center Lease"); and
iii. the Assignment and Assumption of Lease Agreement, dated as of even date
herewith, among Assignor, Assignee and Lessor, with respect to the Lease
Agreement dated December 31, 1996, between Lessor, Integrated Living Communities
of XxXxxxxx, X.X., a Delaware limited partnership ("ILCM"), successor by
conversion to Integrated Living Communities of McKinney, Inc., a Delaware
corporation, as lessee, for the assisted living facility located at 0000 X.
Xxxxxxxxxxx Xxxxx, XxXxxxxx, Xxxxx 00000, which was amended by that certain
First Amendment to Lease Agreement dated as of December 1, 1997 and that Second
Amendment to Lease Agreement dated as of May 9, 2002, and which was previously
assigned to Assignor by that certain Assignment and Assumption of Lease
Agreement (With Consent) dated as of May 9, 2002 (as amended and assigned, the
"McKinney Lease" and, together with the Lease, the Xxxxxxxxx Lease and the
Medical Center Lease, the "Related Leases").
8.2 Contemporaneously with or prior to the execution and delivery of this
Agreement, the Management Agreement between Assignor and Assignee pursuant to
which Assignee manages the Leased Property for Assignor shall be terminated.
8.3 Emeritus shall execute and deliver a Guaranty of Payment and Performance
in form and content satisfactory to Lessor, guaranteeing Assignee's obligations
under the Lease.
8.4 No later than the date of this Agreement, Assignee shall provide Lessor
with the proof of insurance required by the Lease.
8.5 Contemporaneously with the execution and delivery of this Agreement,
Assignee shall execute and deliver to Lessor a Security Agreement, UCC-1
financing statements, Short Form Memorandum and Assignment and Assumption of
Lease and First Right of Refusal (to be recorded), and Absolute Assignment of
Rents and Leases, each in the form previously signed by Assignor in May, 2002.
The existing Security Agreement and Absolute Assignment of Rents and Leases
shall be deemed terminated and of no further force or effect upon the execution
and delivery of this Agreement.
9. LESSOR'S CONSENT. Subject to satisfaction of the foregoing conditions
precedent, Lessor consents to the assignment of the Lease to Assignee. LESSOR
HAS NOT MADE AND DOES NOT HEREBY MAKE ANY EXPRESS OR IMPLIED REPRESENTATION OR
WARRANTIES WHATSOEVER WITH RESPECT TO THE TITLE OR CONDITION OF THE ASSIGNED
RIGHTS AND INTERESTS, INCLUDING ANY PREPRESENTATION OR WARRANTY REGARDING
QUALITY OF CONSTRUCTION, WORKMANSHIP, MERCHANTABILITY OR FITNESS FOR ANY
PARTICULAR PURPOSE, AND ASSIGNEE ACKNOWLEDGES THAT ASSIGNEE ACCEPTS THIS
AGREEMENT WITHOUT RELYING UPON ANY SUCH STATEMENT OR REPRESENTATION MADE BY
LESSOR, ITS AGENTS OR CONTRACTORS, OR BY ANY OTHER PERSON(S) AND THAT ASSIGNEE
ACCEPTS THE LEASED PROPERTY "AS IS" "WHERE IS" AND "WITH ALL FAULTS".
10. RESERVATION OF RIGHTS. Subject to the provisions of Section 5, Lessor
hereby reserves all of its rights and remedies available to it under the Lease
or applicable law, including all rights and remedies available to Lessor as a
result of any Event of Default or other event of which Lessor is unaware, which
event, with the giving of notice or passage of tie, or both, would constitute an
Event of Default. Assignor and Assignee consent and agree to the foregoing
reservation of rights and remedies.
11. LESSOR'S ESTOPPEL. Lessor represents to Assignee that, to Lessor's
actual knowledge, (i) there is no default on the part of Assignor under the
Lease or event, which, with the giving of notice or passage of time or both,
would constitute an Event of Default under the Lease; (ii) the Lease is valid
and in full force and effect and has not been modified, supplement, assigned or
amended by Lessor; (iii) there are no existing or impending condemnation
proceedings which could affect the Leased Property; and (iv) Exhibit "B"
accurately reflects the amount of the current Minimum Rent payable monthly and
the date through which the Minimum Rent due under the Lease has been paid.
12. EXECUTION BY EMERITUS. Emeritus has joined in the execution of this
Agreement for the purpose of (i) making certain representations, warranties,
covenants and other agreements as set forth herein, and (ii) acknowledging and
consenting to the terms and conditions of this Agreement.
13. SECURITY DEPOSIT AGREEMENT. The Security Deposit Agreement dated as of
November 19, 2002 executed and delivered by Assignor in favor of Lessor, shall
terminate effective January 1, 2004, and Lessor shall wire transfer the
remaining Security Deposit thereunder to Assignor within three (3) business days
thereafter.
14. REIMBURSEMENT OF ATTORNEYS FEES AND EXPENSES. Assignor shall reimburse
Lessor for reasonable attorneys' fees and expenses incurred by Lessor through
the Effective Date in connection with the review of this Agreement and the
related documents.
15. NOTICES. Assignee and Lessor acknowledge that the new addresses for
notices to Lessor and Assignee (as the successor Lessee under the Lease) are as
follows:
LESSOR:
HR ACQUISITION OF SAN ANTONIO, LTD.,
c/o Healthcare Realty Trust Incorporated
0000 Xxxx Xxx Xxxxxx
Xxxxx 000
Xxxxxxxxx, XX 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Attn: Xx. X.X. Xxxxxx Xxxxxx, Senior Vice President-Asset Administration
With a copy to:
Healthcare Realty Trust Incorporated
0000 Xxxx Xxx Xxxxxx
Xxxxx 000
Xxxxxxxxx, XX 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Attn: General Counsel
ASSIGNEE:
ESC-IV, LP
c/o Emeritus Corporation
0000 Xxxxxxx Xxxxxx, Xxxxx 000
Xxxxxxx, XX 00000-0000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Attn: Xxxxxxx X. Xxxxxxxxxx - VP - Finance
With a copy to:
The Xxxxxxxxx Group, PLLC
0000 Xxxxxx Xxxxxx, Xxxxx Xxxxx
Xxxxxxx, XX 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Attn: Xxxxx X. Xxxxxxxxx, Esq.
16. MISCELLANEOUS. This Agreement shall be interpreted according to the
laws of the State where the Leased Property is located. Except as specifically
set forth herein, no party shall assign its rights and obligations under this
Agreement without the prior written approval of the other parties. This
Agreement constitutes the entire agreement and understanding of the parties with
respect to the subject matter hereof and supersedes all prior agreements, oral
or written, and all other communications among the parties relating to such
subject matter. This Agreement shall not be modified or amended except by
mutual written agreement. The waiver by any party of a breach or violation of
any provisions of this Agreement shall not operate as or be construed to be, a
waiver of any subsequent breach of the same or any other provision. In the
event any provision of this Agreement is held to be unenforceable or invalid for
any reason, this Agreement shall remain in full force and effect and enforceable
in accordance with its terms disregarding such unenforceable or invalid
provision. The captions or headings in this Agreement are made for convenience
and general reference only and should not be construed to describe, define or
limit the scope and intent of the provisions of this Agreement. This Agreement
may be executed in one or more counterparts, each of which shall be an original
and taken together shall constitute one and the same document. Signature and
acknowledgement pages, if any, may be detached from the counterparts and
attached to a single copy of this document to physically form one document.
Subject to the provisions set forth above regarding assignment by either party,
this Agreement shall be binding and shall inure to the benefit of the parties
hereto, and their respective heirs, legatees, executors, administrators, legal
representatives, successors and assigns. The parties acknowledge that all
parties hereto, and their counsel, have read and fully negotiated all of the
language used in this Agreement. The parties acknowledge that, because all
parties and their counsel participated in negotiating and drafting this
Agreement, no rule of construction shall apply to this Agreement which construes
ambiguous and unclear language in favor of or against any party because such
party drafted this Agreement. With respect to all provisions of this Agreement,
time is of the essence. The word "including", when following any general
statement, term or matter shall not be construed to limit such statement, term
or matter to the specific terms or matters as provided immediately following the
word "including" or to similar items or matters, whether or not nonlimiting
language (such as "without limitation", "but not limited to", or words of
similar import) is used with reference to the word "including" or the similar
items or matters, but rather shall be deemed to refer to all other items or
matters that could reasonably fall within the broadest possible scope of the
general statement, term or matter. References to any party in the singular, or
as "him," "her," "it," "its," "itself," or other like references, shall also be
deemed to include the plural or the masculine or feminine references, as the
case may be. References to any of the parties in the plural, or as "they,"
"them," "their" or other like references, shall also be deemed to include the
singular reference.
17. EXECUTION BY TELEFACSIMILE. Any copy of this Agreement bearing a
signature of a party to this Agreement and sent by facsimile to any other party
shall be deemed a manually-executed original of this Agreement, and shall be
deemed sufficient to bind such party.
SIGNATURES BEGIN ON FOLLOWING PAGE
IN WITNESS WHEREOF, Assignor, Assignee and Lessor, acting by and through their
respective duly authorized officers, have executed and delivered this Agreement
as of the Effective Date.
ASSIGNOR
HB-ESC V, L.P.,
By it General Partner:
HB-ESC III, LLC
By: /s/ Xxxxxx X. Xxxx
Xxxxxx X. Xxxx, Manager
ASSIGNEE
ESC IV, L.P., a Washington limited partnership,
doing business in Texas as Texas-ESC IV, L.P.
By its general partner:
ESC X.X. XX, INC.,
A Washington corporation
By: /s/ Xxxxxxx X. Xxxxxxx
Xxxxxxx X. Xxxxxxx
Its: Director of Real Estate Finance
LESSOR:
HR ACQUISITION OF SAN ANTONIO, LTD.
By its general partner:
Healthcare Acquisition of Texas, Inc.
By: /s/ Xxxx X. Xxxxxx, Xx.
Xxxx X. Xxxxxx, Xx.
Senior Vice President and General Counsel
"EXISTING GUARANTOR"
/s/ Xxxxxx X. Xxxx
Xxxxxx X. Xxxx
EMERITUS CORPORATION
By: /s/ Xxxxxxx X. Xxxxxxx
Name: Xxxxxxx X. Xxxxxxx
Title: Director of Real Estate Finance
EXHIBIT A
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(OAKWELL)
Legal description of land:
Being a 5.230 acre tract of land situated in the Gonifacio Xxxxxxxxx Xxxxxx Xx.
000, Xxxxxxxx Number 621, in the City of San Antonio, Bexar County, Texas and
being all of Xxx 0, Xxxxx 0 (NCB 17306) of Oakwell Farms Unit-7 an addition to
the City of San Antonio according to the plat recorded in Volume 9503, Page(s)
179-181 and amended by plat recorded in Volume 9504, Page(s) 142-143 of the Plat
Records of Bexar County, Texas (PRBCT) and being more particularly described as
follows:
BEGINNING at a 5/8 inch iron rod set for the southwest corner of said Xxx 0,
Xxxxx 0 and being the northwest corner of Xxx 0, Xxxxx 0 (NCB 17306) of said
Oakwell Farms Unit-7 and being located in the east right-of-way line of Oakwell
Court (a 60' wide right-of-way) and being in a curve to the left having a radius
of 530.00 feet, a chord bearing of North 09 08' 51" West and a chord length of
225.86 feet;
THENCE along the east right-of-way line of said Oakwell Court as follows:
Continuing along said curve to the left in a northerly direction through a
central angle of 24 36' 17" for an arc length of 227.60 feet to a 5/8 inch iron
rod set for the point of tangency;
North 21 27' 00" West a distance of 301.33 feet to a 5/8 inch iron rod set for
the beginning of a curve to the right having a radius of 270.00 feet, a chord
bearing of North 10 36' 30" West and a chord length of 101.57 feet;
Continuing along said curve to the right through a central angle of 21 41' 01"
for an arc length of 102.18 feet to a 5/8 inch iron rod set for the beginning of
a compound curve to the right having a radius of 20.00 feet, a chord bearing of
North 47 25' 14" East and a chord length of 29.45 feet;
Continuing along said compound curve to the right through a central angle of 94
50' 27" for an arc length of 33.11 feet to a 5/8 inch iron rod set for the point
of tangency and being located in the southerly right-of-way line of Oakwell
Farms Parkway (a variable width right-of-way);
THENCE along the southerly right-of-way line of said Oakwell Farms Parkway as
follows:
South 85 09' 33" East a distance of 249.20 feet to a 5/8 inch iron rod set for
the beginning of a curve to the left having a radius of 705.00 feet, a chord
bearing of South 87 26' 42" East and a chord length of 56.24 feet;
Along said curve to the left through a central angle of 04 34' 19" for an arc
length of 56.25 feet to a 5/8 inch iron rod set for the end of said curve;
South 53 50' 00" East a distance of 76.03 feet to a 5/8 inch iron rod set for
corner;
North 81 10' 00" East a distance of 20.72 feet to a 5/8 inch iron rod set for
the northeast corner of said Xxx 0, Xxxxx 0 and being in a curve to the left
having a radius of 1,412.40 feet, a chord bearing of South 15 31' 04" East and a
chord length of 239.28 feet;
THENCE departing the southerly right-of-way line of said Oakwell Farms Parkway
and following the easterly line of said Xxx 0, Xxxxx 0 as follows:
Continuing along said curve to the left in a southerly direction through a
central angle of 09 43' 07" for an arc length of 239.57 feet to a 5/8 inch iron
rod set for the beginning of a reverse curve to the right having a radius of
1,975.00 feet, a chord bearing of South 16 17' 46" East and a chord length of
281.14 feet;
Continuing along said reverse curve to the right through a central angle of 08
09' 47" for an arc length of 281.38 feet to a 5/8 inch iron rod set for corner;
South 05 08' 02" East a distance of 25.75 feet to a 5/8 inch iron rod set for
the southeast corner of said Xxx 0, Xxxxx 0 and being the northeast corner of
said Xxx 0, Xxxxx 0;
THENCE along a common line between said Xxxx 0 & 0, Xxxxx 0, Xxxxx 00 18' 00"
West a distance of 389.76 feet to the Point of Beginning;
Containing within these metes and bounds 5.230 acres or 227,807 square feet of
land, more or less, all according to that survey prepared by Xxxxx-Xxxxxxx
Associates, Inc. dated August, 1996 and signed by Xxxxxx X. Xxxxxxx, Registered
Professional Land Surveyor No. 4132; to which reference for all purposes is
hereby made.
Exhibit B
To
Assignment and Assumption Agreement
Xxxxxxxx Place at Oakwell Farms
1. Minimum Monthly Rent: $66,034.88
2. Rent Current Through: December 31, 2003
