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EXHIBIT 10.79
RIGHT OF FIRST OFFER AGREEMENT
THIS RIGHT OF FIRST OFFER AGREEMENT (the "Agreement") is entered into
as of this 30th day of January, 1998, by and between AHP OF TENNESSEE, INC., a
Tennessee corporation (the "Lessor") and BALANCED CARE CORPORATION, a Delaware
corporation ("BCC").
WITNESSETH:
WHEREAS, Lessor and Assisted Living Operators of Xxxxxxx, LLC, a
Delaware limited liability company (the "Lessee") have concurrently herewith
entered into a certain Lease and Security Agreement dated as of January 30, 1998
(as the same may be amended, modified, altered or supplemented, the "Lease")
whereby Lessor will lease to Lessee a certain residential care facility to be
constructed and located in Madison County, Tennessee (the "Property"). The legal
description with respect to the Property upon which such facility is to be
located is more fully described in Exhibit A attached hereto; and
WHEREAS, Lessor and BCC Development & Management Co., a Delaware
corporation ("BCC Development") have concurrently herewith entered into that
certain Development Agreement dated as of January 30, 1998 (as the same may be
amended, modified, altered or supplemented, the "Development Agreement"),
whereby BCC Development, as Developer under the Development Agreement, will
cause to be constructed on the Property an assisted living facility (the
"Facility"); and
WHEREAS, Lessee and Balanced Care at Xxxxxxx, Inc., a Delaware
corporation (the "Manager"), have concurrently herewith entered into that
certain Management Agreement dated as of January 30, 1998 (as the same may be
amended, modified, altered or supplemented, the "Management Agreement"), whereby
Lessee has appointed Manager as the sole and exclusive manager of the Facility,
on the terms and conditions provided in the Management Agreement, the Lease, the
other Lease Documents (as defined in Appendix 1 to the Management Agreement) and
the other Transaction Documents (as defined in Appendix 1 to the Management
Agreement); and
WHEREAS, to protect the interests of BCC Development under the
Development Agreement and the Manager under the Management Agreement, Lessor has
agreed to grant to BCC on the terms and subject to the conditions contained
herein a right of first offer with respect to the sale or other transfer of all
or any portion of the Property and/or the Facility.
NOW, THEREFORE, for good and valuable consideration, and intending to
be legally bound hereby, Lessor and BCC agree as follows:
1. Offer Right. Commencing on the date hereof and terminating
upon the expiration or sooner termination of the Lease in accordance with its
terms, and subject to the terms hereof, Lessor hereby grants to BCC a right of
first offer (the "Offer Right") with respect to the Transfer (as hereinafter
defined) of all or any portion of each Property and/or Facility leased to Lessee
or its Affiliates by Lessor or its Affiliates in accordance with that certain
Facility Agreement dated January 30, 1998 entered into by and between BCC and
American Health Properties, Inc., a
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Delaware corporation ("AHP") (the "Facility Agreement") on the terms and subject
to the conditions contained herein.
1.1. In the event Lessor desires during the term of this
Agreement to Transfer all or any portion of any or all of the Property and/or
Facilities Lessor shall promptly deliver to BCC in writing a written notice (the
"Selling Notice") identifying which Property and/or Facility Lessor would like
to Transfer and stating the minimum terms which Lessor would accept in
connection with that proposed Transfer, including the minimum purchase price
acceptable to Lessor (and other economic terms that Lessor intends to request in
connection with such Transfer) (collectively, the "Transfer Terms").
1.2. Within 15 days after receipt by BCC of the Selling
Notice, BCC shall deliver to Lessor either (a) a written notice (the "Acceptance
Notice") stating that BCC wishes to receive a Transfer of the Property and/or
the Facility on the Transfer Terms stated in the Selling Notice, which
Acceptance Notice shall constitute its exercise of the Offer Right and BCC's
binding and irrevocable commitment to purchase the Property and/or Facility
identified in the Selling Notice on the Transfer Terms stated therein or (b) a
written notice (the "Rejection Notice") stating that BCC does not wish to accept
such a Transfer of that Property or Facility. BCC's failure to deliver either
the Rejection Notice or the Acceptance Notice within the foregoing 15 day period
shall constitute BCC's election not to exercise the Offer Right.
1.3. If BCC exercises the Offer Right by delivery to
Lessor of the Acceptance Notice within the 15 day time period provided in
Paragraph 1.2, then such Transfer shall be consummated within 45 days thereafter
(or such other time as the parties may mutually agree).
1.4. If BCC either delivers a Rejection Notice or fails to
deliver the Acceptance Notice to Lessor within the time frame provided in
Paragraph 1.2, Lessor shall be free to seek and accept offers for Transfer of
the Property and/or the Facility at a price and on terms no less favorable to
the transferee than as set forth in the Transfer Offer, and all rights of BCC
hereunder (including the Offer Right) shall thereupon terminate, except as
provided in the next sentence of this paragraph. If such Transfer is not
consummated on terms and conditions at least as favorable to the transferee as
those provided in the Transfer Offer, or Lessor does not otherwise complete the
Transfer on terms equal to or more favorable to Lessor as those provided in the
Transfer Offer within 12 months after the date of the Selling Notice, BCC shall
again be entitled to exercise the Offer Right as herein provided, as to any
proposed subsequent Transfer of all or any portion of the Property and/or the
Facility during the term of this Agreement.
2. Transfer Defined. As used in this Agreement, "Transfer" means
(i) any sale, ground lease of a term longer than 10 years, or other conveyance
of all or any portion of the Property and/or the Facility or (ii) the transfer
of all or any portion of the issued and outstanding common stock of Lessor.
3. Limitation of Offer Right. Notwithstanding any provision
herein to the contrary, in no event shall BCC have the right to exercise the
Offer Right, and Lessor shall be under no obligation to provide the Transfer
Offer or Selling Notice to BCC, in the event that at the time Lessor wishes in
good faith to effect a Transfer, there exists and is continuing a default or
event
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of default under any Lease, Development Agreement or other Transaction Document
delivered under the Facility Agreement.
4. Construction. Time shall be of the essence regarding this
Agreement. This Agreement shall be governed and construed in accordance with the
laws of the State of Pennsylvania, exclusive of its conflicts of laws. This
Agreement may not be amended, except by a writing executed by both parties.
Notices to be given hereunder shall be provided in the manner provided in
Section 29.8 of the Lease. This Agreement may not be recorded in any public
records.
5. Leasehold Estate. Lessor and BCC acknowledge and agree that
any Transfer of the Property and/or the Facility pursuant to this Agreement
shall be subject to the leasehold estate of Lessee in the Lease; provided,
however, in no event shall Lessee be deemed a third party beneficiary of this
Agreement.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement on
this 1st day of February, 1998 to be effective as of the date first written
above.
AHP OF TENNESSEE, INC.,
a Tennessee corporation
By: /s/ Xxxxxx X. Xxxxxxx
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Xxxxxx X. Xxxxxxx, Vice President
BALANCED CARE CORPORATION,
a Delaware corporation
By: /s/ Xxxxx Xxxxx
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Xxxxx Xxxxx, Vice President
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Schedule to Exhibit 10.79 filed pursuant to Instruction 2 to Item
601(a) of Regulation S-K
Right of First Offer
Location Lessor Manager
Anderson, IN AHP of Indiana, Inc. Balanced Care at
Xxxxxxxx, Inc.
