ELEVENTH AMENDMENT TO CONSOLIDATED AMENDED AND RESTATED MASTER LEASE
Exhibit 10.1
ELEVENTH AMENDMENT TO CONSOLIDATED
AMENDED AND RESTATED MASTER LEASE
AMENDED AND RESTATED MASTER LEASE
This Eleventh Amendment to Consolidated Amended and Restated Master Lease (this
“Amendment”) is executed and delivered as of April 18, 2011 by and between STERLING
ACQUISITION CORP., a Kentucky corporation (“Lessor”), the address of which is 000
Xxxxxxxxxxxxx Xxxxxx, Xxxxx 0000, Xxxx Xxxxxx, XX 00000, and DIVERSICARE LEASING CORP., a Tennessee
corporation, the address of which is 0000 Xxxxxxxx Xxxxxxxxx, Xxxxxxxxx, XX 00000.
RECITALS:
A. Lessee has executed and delivered to Lessor a Consolidated Amended and Restated Master
Lease dated as of November 8, 2000, but effective as of October 1, 2000 (the “Master
Lease”), as amended by a First Amendment to Consolidated Amended and Restated Master Lease
dated as of September 30, 2001, a Second Amendment to Consolidated Amended and Restated Master
Lease dated as of June 15, 2005 (the “Second Amendment”), a Third Amendment to Consolidated
Amended and Restated Master Lease dated as of October 20, 2006 (the “Third Amendment”), a
Fourth Amendment to Consolidated Amended and Restated Master Lease dated as of April 1, 2007, a
Fifth Amendment to Consolidated Amended and Restated Master Lease dated as of August 10, 2007, a
Sixth Amendment to Consolidated Amended and Restated Master Lease dated as of March 14, 2008, a
Seventh Amendment to Consolidated Amended and Restated Master Lease dated as of October 24, 2008,
an Eighth Amendment to Consolidated Amended and Restated Master Lease dated as of March 31, 2009, a
Ninth Amendment to Consolidated Amended and Restated Master Lease dated as of May 5, 2009 (the
“Ninth Amendment”), and a Tenth Amendment to Consolidated Amended and Restated Master Lease
dated as of September 8, 2009 (collectively, the “Existing Master Lease”) pursuant to which
Lessee leases from Lessor certain healthcare facilities.
B. Lessee has requested that Lessor to make available to Lessee additional capital
improvements funds in the amount of Five Million Dollars ($5,000,000), and Lessor desires to do so
on the terms and conditions of this Amendment.
NOW THEREFORE, the parties agree as follows:
1. Definitions. Any capitalized term used but not defined in this Amendment will have
the meaning assigned to such term in the Master Lease. From and after the date of this Amendment,
each reference in the Existing Master Lease or the other Transaction Documents to the “Lease” or
“Master Lease” means, as applicable, the Existing Master Lease as modified by this Amendment.
2. Tenant Improvement Allowance. Pursuant to the Second Amendment, Lessor made
available to Lessee an Improvement Allowance of Five Million Dollars ($5,000,000). Pursuant to the
Third Amendment, Lessor made an additional Improvement Allowance of Five Million Dollars
($5,000,000) available to Lessee. Pursuant to the Ninth Amendment, Lessor
made an additional Improvement Allowance of Five Million Dollars ($5,000,000) available to
Lessee. Lessor hereby makes available to Lessee an additional improvement allowance equal to
Five
Million Dollars ($5,000,000) to be used for certain capital improvements to the Facilities. Such
additional improvement allowance shall be used only for completion of capital improvements to the
Facilities listed on Exhibit A to this Amendment, which shall be approved and constructed
in accordance with the terms and provisions of Paragraph 2 of the Second Amendment. The term
“Capital Improvements” as and where used in Paragraph 2 of the Second Amendment shall be deemed to
include such capital improvements. The additional improvement allowance shall be requested and
disbursed in accordance with the provisions of Paragraph 3 of the Second Amendment. The term
“Improvement Allowance”, as and where used in Paragraph 3 of the Second Amendment, shall be deemed
to include and refer to the additional improvement allowance provided for in this paragraph, except
that such additional improvement allowance shall be available for Capital Improvements completed on
or before February 28, 2012 and the final request for disbursement shall be no later than May 31,
2012. The annual Base Rent payable under the Existing Master Lease shall be increased by the
Improvement Allowance Adjustment Amount for each disbursement of such additional improvement
allowance as provided in Paragraph 4 of the Second Amendment. In the event Lessor fails to pay
Lessee any installment request for the additional improvement allowance as provided in Paragraph 3
of the Second Amendment, Lessee shall have the rights and remedies provided in Paragraph 4 of the
Second Amendment and the provisions of Paragraph 4 of the Second Amendment shall apply to Lessee’s
exercise of such rights and remedies.
3. Notices. The addresses of the Lessor and the Lessee for purposes of giving any
notice, request or other communication currently set forth in Section 31.1 of the Existing Master
Lease are hereby amended and restated as follows:
| To Lessee: | Diversicare Leasing Corp. c/o Advocat Inc. 0000 Xxxxxxxx Xxxxxxxxx Xxxxxxxxx, XX 00000 Attention: Chief Financial Officer Telephone No.: (000) 000-0000 Facsimile No.: (000) 000-0000 |
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| To Lessor: | Sterling Acquisition Corp. c/o Omega Healthcare Investors, Inc. 000 Xxxxxxxxxxxxx Xxxxxx, Xxxxx 0000 Xxxx Xxxxxx, XX 00000 Telephone No.: (000) 000-0000 Facsimile No.: (000) 000-0000 |
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| And with copy to (which shall not constitute notice): | Xxxxx Derwent, PLLC 0000 Xxxxx Xx., X.X., Xxxxx 000 Xxxxx Xxxxxx, Xxxxxxxx 00000 Attn: Xxxx X. Derwent Telephone No.: (000) 000-0000 Facsimile No.: (000) 000-0000 |
2
4. Representations and Warranties of Lessee. Lessee hereby represents and warrants to
Lessor that (i) it has the right and power and is duly authorized to enter into this Amendment; and
(ii) the execution of this Amendment does not and will not constitute a breach of any provision
contained in any agreement or instrument to which Lessee is or may become a party or by which
Lessee is or may be bound or affected.
5. Expenses of Lender. Lessee shall pay all reasonable expenses of Lessor incurred in
connection with this Amendment, including reasonable attorneys fees and expenses.
6. Execution and Counterparts. This Amendment may be executed in any number of
counterparts, each of which, when so executed and delivered, shall be deemed to be an original, but
when taken together shall constitute one and the same Amendment.
7. Headings. Section headings used in this Amendment are for reference only and shall
not affect the construction of the Amendment.
8. Enforceability. Except as expressly and specifically set forth herein, the
Existing Master Lease remains unmodified and in full force and effect. In the event of any
discrepancy between the Existing Master Lease and this Amendment, the terms and conditions of this
Amendment will control and the Existing Master Lease is deemed amended to conform hereto.
[SIGNATURE PAGES AND ACKNOWLEDGEMENTS FOLLOW]
3
Signature Page to
ELEVENTH AMENDMENT TO CONSOLIDATED
AMENDED AND RESTATED MASTER LEASE
ELEVENTH AMENDMENT TO CONSOLIDATED
AMENDED AND RESTATED MASTER LEASE
| LESSOR: STERLING ACQUISITION CORP., a Kentucky corporation |
||||
| By: | /s/ Xxxxxx X. Xxxxx | |||
| Name: | Xxxxxx X. Xxxxx | |||
| Title: | Chief Operating Officer | |||
STATE OF MARYLAND
|
) | |||
COUNTY OF BALTIMORE
|
) |
This instrument was acknowledged before me on the 15th day of April, 2011, by Xxxxxx X.
Xxxxx, the COO of STERLING ACQUISITION CORP., a Kentucky corporation, on behalf of said company.
| /s/ Chin-Tsu Tai | ||||
| Notary Public, Baltimore County, MD | ||||
| My commission expires: September 9, 2012 | ||||
Signature Page 1 of 2
Signature Page to
ELEVENTH AMENDMENT TO CONSOLIDATED
AMENDED AND RESTATED MASTER LEASE
ELEVENTH AMENDMENT TO CONSOLIDATED
AMENDED AND RESTATED MASTER LEASE
| LESSEE: DIVERSICARE LEASING CORP., a Tennessee corporation |
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| By: | /s/ Xxxxx Xxxxxx | |||
| Name: | Xxxxx Xxxxxx | |||
| Title: | EVP and CFO | |||
STATE OF TENNESSEE
|
) | |||
COUNTY OF XXXXXXXXXX
|
) |
This instrument was acknowledged before me on the 18th day of April, 2011, by Xxxxx Xxxxxx,
the EVP & CFO of DIVERSICARE LEASING CORP., a Tennessee corporation, on behalf of said company
| /s/ Xxxxxxxxxx X. Xxxx | ||||
| Notary Public, Tenn. County, Xxxxxxxxxx | ||||
| My commission expires: 1/12/2014 | ||||
Signature Page 2 of 2
Acknowledgement to
ELEVENTH AMENDMENT TO CONSOLIDATED
AMENDED AND RESTATED MASTER LEASE
ELEVENTH AMENDMENT TO CONSOLIDATED
AMENDED AND RESTATED MASTER LEASE
The undersigned hereby consent to the transactions contemplated by this Eleventh Amendment to
Consolidated Amended and Restated Master Lease (this “Amendment”), ratify and affirm their
respective Guaranties, Pledge Agreements, Security Agreements, Subordination Agreements and other
Transaction Documents, and acknowledge and agree that the performance of the Master Lease and
obligations described therein are secured by their Guaranties, Pledge Agreements, Security
Agreement, Subordination Agreement and other Transaction Documents on the same terms and conditions
in effect prior to this Amendment.
| ADVOCAT, INC. a Delaware corporation |
||||
| By: | /s/ Xxxxx Xxxxxx | |||
| Name: | Xxxxx Xxxxxx | |||
| Title: | EVP & CFO | |||
STATE OF TENNESSEE |
) | |
COUNTY OF XXXXXXXXXX |
) |
The foregoing instrument was acknowledged before me this 18th day of April, 2011, by Xxxxx
Xxxxxx, who is EVP & CFO of ADVOCAT, INC. a Delaware corporation, on behalf of the corporation, who
acknowledged the same to be his or her free act and deed and the free act and deed of the
corporation.
| /s/ Xxxxxxxxxx X. Xxxx | ||||
| Notary Public, Tenn. County, Xxxxxxxxxx | ||||
| My commission expires: 1/12/2014 | ||||
Acknowledgement Page 1 of 5
Acknowledgment to
ELEVENTH AMENDMENT TO CONSOLIDATED
AMENDED AND RESTATED MASTER LEASE
ELEVENTH AMENDMENT TO CONSOLIDATED
AMENDED AND RESTATED MASTER LEASE
| DIVERSICARE MANAGEMENT SERVICES CO., a Tennessee corporation |
||||
| By: | /s/ Xxxxx Xxxxxx | |||
| Name: | Xxxxx Xxxxxx | |||
| Title: | EVP & CFO | |||
STATE OF TENNESSEE
|
) | |||||
COUNTY OF XXXXXXXXXX
|
) |
The foregoing instrument was acknowledged before me this 18th day of April, 2011, by Xxxxx
Xxxxxx, who is EVP & CFO of DIVERSICARE MANAGEMENT SERVICES CO., a Tennessee corporation, on
behalf of the corporation, who acknowledged the same to be his or her free act and deed and the
free act and deed of the corporation.
| /s/ Xxxxxxxxxx X. Xxxx | ||||
| Notary Public, Tenn. County, Xxxxxxxxxx | ||||
| My commission expires: 1/12/2014 | ||||
Acknowledgement Page 2 of 5
Acknowledgment to
ELEVENTH AMENDMENT TO CONSOLIDATED
AMENDED AND RESTATED MASTER LEASE
ELEVENTH AMENDMENT TO CONSOLIDATED
AMENDED AND RESTATED MASTER LEASE
| ADVOCAT FINANCE INC., a Delaware corporation |
||||
| By: | /s/ Xxxxx Xxxxxx | |||
| Name: | Xxxxx Xxxxxx | |||
| Title: | EVP & CFO | |||
STATE OF TENNESSEE
|
) | |||||
COUNTY OF XXXXXXXXXX
|
) |
The foregoing instrument was acknowledged before me this 18th day of April, 2011, by Xxxxx
Xxxxxx, who is EVP & CFO of ADVOCAT FINANCE INC., a Delaware corporation, on behalf of the
corporation, who acknowledged the same to be his or her free act and deed and the free act and deed
of the corporation.
| /s/ Xxxxxxxxxx X. Xxxx | ||||
| Notary Public, Tenn. County, Xxxxxxxxxx | ||||
| My commission expires: 1/12/2014 | ||||
Acknowledgement Page 3 of 5
Acknowledgment to
ELEVENTH AMENDMENT TO CONSOLIDATED
AMENDED AND RESTATED MASTER LEASE
ELEVENTH AMENDMENT TO CONSOLIDATED
AMENDED AND RESTATED MASTER LEASE
| STERLING HEALTH CARE MANAGEMENT, INC., a Kentucky corporation |
||||
| By: | /s/ Xxxxx Xxxxxx | |||
| Name: | Xxxxx Xxxxxx | |||
| Title: | EVP & CFO | |||
STATE OF TENNESSEE
|
) | |||||
COUNTY OF XXXXXXXXXX
|
) |
The foregoing instrument was acknowledged before me this 18th day of April, 2011, by Xxxxx
Xxxxxx, who is EVP & CFO of STERLING HEALTH CARE MANAGEMENT, INC., a Kentucky corporation, on
behalf of the corporation, who acknowledged the same to be his or her free act and deed and the
free act and deed of the corporation.
| /s/ Xxxxxxxxxx X. Xxxx | ||||
| Notary Public, Tenn. County, Xxxxxxxxxx | ||||
| My commission expires: 1/12/2014 | ||||
Acknowledgement Page 4 of 5
Acknowledgment to
ELEVENTH AMENDMENT TO CONSOLIDATED
AMENDED AND RESTATED MASTER LEASE
ELEVENTH AMENDMENT TO CONSOLIDATED
AMENDED AND RESTATED MASTER LEASE
| DIVERSICARE TEXAS I, LLC |
||||
| By: | /s/ Xxxxx Xxxxxx | |||
| Name: | Xxxxx Xxxxxx | |||
| Title: | EVP & CFO | |||
| DIVERSICARE XXXXXXXXX, LLC DIVERSICARE DOCTORS, LLC DIVERSICARE ESTATES, LLC DIVERSICARE HUMBLE, LLC DIVERSICARE KATY, LLC DIVERSICARE NORMANDY TERRACE, LLC DIVERSICARE TREEMONT, LLC |
||||
| BY: | DIVERSICARE TEXAS I, LLC, | |||
| its sole member | ||||
| By: | /s/ Xxxxx Xxxxxx | |||
| Name: | Xxxxx Xxxxxx | |||
| Title: | EVP & CFO | |||
STATE OF TENNESSEE
|
) | |||||
COUNTY OF XXXXXXXXXX
|
) |
The foregoing instrument was acknowledged before me this 18th day of April, 2011, by Xxxxx
Xxxxxx, who is EVP & CFO of DIVERSICARE TEXAS I, LLC, on behalf of itself and as the sole member of
each of DIVERSICARE XXXXXXXXX, LLC, DIVERSICARE DOCTORS, LLC, DIVERSICARE ESTATES, LLC, DIVERSICARE
HUMBLE, LLC, DIVERSICARE KATY, LLC, DIVERSICARE NORMANDY TERRACE, LLC, and DIVERSICARE TREEMONT,
LLC, each a Delaware limited liability company, on behalf of the limited liability companies, who
acknowledged the same to be his or her free act and deed and the free act and deed of the limited
liability companies.
| /s/ Xxxxxxxxxx X. Xxxx | ||||
| Notary Public, Tenn. County, Xxxxxxxxxx | ||||
| My commission expires: 1/12/2014 | ||||
Acknowledgement Page 5 of 5
Exhibit A to
ELEVENTH AMENDMENT TO CONSOLIDATED
AMENDED AND RESTATED MASTER LEASE
ELEVENTH AMENDMENT TO CONSOLIDATED
AMENDED AND RESTATED MASTER LEASE
1. Best Care Nursing and Rehabilitation Center Therapy Addition Omega Project Summary
April 5, 2011
Project Address:
Best Care Nursing and Rehabilitation Center
Xxxxxxx Xxxxx
Xxxxxxxxxxxx, Xxxx 00000
Best Care Nursing and Rehabilitation Center
Xxxxxxx Xxxxx
Xxxxxxxxxxxx, Xxxx 00000
Preliminary Project Scope:
Take the existing 739 square feet of current therapy space and incorporate into a 1,765 square foot
addition to give the facility a new 2504 therapy department. Also adding a 338 square foot canopy
for new exterior entrance from parking lot, plus stuccoing walls seen when using this entrance.
Facility Data:
Facility built: 1974
Facility current square footage: 41,330
Square including therapy addition: 43,095
Currently licensed for 139 beds which will not change
Facility current square footage: 41,330
Square including therapy addition: 43,095
Currently licensed for 139 beds which will not change
Estimated Project Cost:
Construction: $381,457.00
6% Contingency: $22,887.00
Total Estimated Project Cost: $404,344.00
Exhibit A — Page 1 of 4
Exhibit A to
ELEVENTH AMENDMENT TO CONSOLIDATED
AMENDED AND RESTATED MASTER LEASE
ELEVENTH AMENDMENT TO CONSOLIDATED
AMENDED AND RESTATED MASTER LEASE
2. Xxxxxx Nursing & Rehabilitation Center Omega Project Summary
April 5, 2011
Project Address:
Xxxxxx Nursing and Rehabilitation Center
000 XxXxxxx Xxxx
Xxxxxxx, Xxxxxxxx 00000
Xxxxxx Nursing and Rehabilitation Center
000 XxXxxxx Xxxx
Xxxxxxx, Xxxxxxxx 00000
Preliminary Project scope:
| 1. | Replace existing roof with architectural style shingles. | ||
| 2. | Build new front entrance to include covered drive, lobby, offices and guest bathrooms. | ||
| 3. | Redesign and update interior to better meet the resident needs such therapy, dining, dayroom and etc. (See blueprints for total project scope) |
Facility Data:
Licensed beds: 120 (No change)
Room type breakdown:
Room type breakdown:
| • | 52 — semi private | ||
| • | 4 — four bed wards |
Built in: 1985
Facility Current Square Footage: 31’000
Xxxxxxxx Xxxxxx Footage after Renovation: 34,330
August Average Daily Census: 107
Facility Current Square Footage: 31’000
Xxxxxxxx Xxxxxx Footage after Renovation: 34,330
August Average Daily Census: 107
Estimated Project Cost:
Construction: $1,161,771.00
Construction: $1,161,771.00
Common area furniture and design cost: $180,000.00
Direct Supply quote: $212,113.00
(Resident room FF&E)
(Resident room FF&E)
New facility sign: $8,000
6% contingency funds figure on all cost listed above: $93,713
Total Estimated Project Cost: $1,655,597.00
Exhibit A — Page 2 of 4
Exhibit A to
ELEVENTH AMENDMENT TO CONSOLIDATED
AMENDED AND RESTATED MASTER LEASE
ELEVENTH AMENDMENT TO CONSOLIDATED
AMENDED AND RESTATED MASTER LEASE
4. Oakmont Healthcare and Rehabilitation Center of Humble Omega Project Summary
Project Address:
Oakmont Healthcare and Rehabilitation Center of Humble
0000 Xxxx Xxxxxxx Xxxxxxx
Xxxxxx, Xxxxx 00000
Oakmont Healthcare and Rehabilitation Center of Humble
0000 Xxxx Xxxxxxx Xxxxxxx
Xxxxxx, Xxxxx 00000
Preliminary Scope of Work:
Rebuild portico, then paint the pink brick exterior to enhance the curb appearance and insure that
the portico does not look like an addition. Add employee parking at the rear of the facility.
Renovate main lobby to create a more appealing look. Relocate and enlarge the therapy department.
Replace the flooring throughout. Replace acoustical ceilings including grid in corridors and common
area’s. Re-skin the existing handrail to eliminate the aqua color. Eliminate the accordion doors
located in main dining room. Update all the common areas. Partial FF&E replacement and install
artwork through out facility. Relocate activity department. Remodel existing main showers to
include two new whirlpools. Replace both nurses’ stations.
Facility Data:
Licensed Beds: 134
Room type breakdown after renovation:
Room type breakdown after renovation:
| • | 56 — semi private | ||
| • | 13 — private | ||
| • | Available Bed total after renovation: 125 ( Note: We could convert private rooms back to semi private and get back to 134 beds if needed) |
Built in: 1985
Facility Square Footage: 47,618
Dec-2010 Average Daily Census: 124
Facility Square Footage: 47,618
Dec-2010 Average Daily Census: 124
Estimated Project Cost:
Construction: $1,181,965.00
Common area furniture and design cost: $222,000.00
Extra parking lot in rear of facility: $85,000.00
Resident room furniture: $65,000.00
6% contingency funds figure on all cost listed above: $93,238.00
Total Estimated Project Cost: $1,647,203.00
Exhibit A — Page 3 of 4
Exhibit A to
ELEVENTH AMENDMENT TO CONSOLIDATED
AMENDED AND RESTATED MASTER LEASE
ELEVENTH AMENDMENT TO CONSOLIDATED
AMENDED AND RESTATED MASTER LEASE
4. Pocahontas Healthcare and Rehabilitation Center Omega Project Summary
Project Address:
Pocahontas Healthcare and Rehabilitation Center
000 Xxxxxxx Xxxx Xxxx
Xxxxxxxxxx, Xxxxxxxx 00000
Pocahontas Healthcare and Rehabilitation Center
000 Xxxxxxx Xxxx Xxxx
Xxxxxxxxxx, Xxxxxxxx 00000
Preliminary Scope of Work:
Renovate the entire facility to include replacement of handrails, suspended ceiling and lights in
all common areas, replace all common area and resident FF&E, artwork, signage, replace parking lot,
redesign main entrance, replace all toilets and sinks in resident and public bathrooms, new windows
and develop top line therapy gym.
Facility Data:
Licensed Beds: 97
Room type breakdown:
Licensed Beds: 97
Room type breakdown:
| • | 48 — semi private | ||
| • | 1 — private | ||
| • | Available Bed total after renovation: 97 |
Built in: 1984
Facility Square Footage: 25,922
Dec-2010 Average Daily Census: 67
Facility Square Footage: 25,922
Dec-2010 Average Daily Census: 67
Estimated Project Cost:
Construction: $815,000.00
Construction: $815,000.00
Common area furniture and design cost: $165,000.00
Resident room furniture: $178,733.00
6% contingency funds figure on all cost listed above: $69,524.00
Total Estimated Project Cost: $1,228.257.00
Exhibit A — Page 4 of 4
