EXHIBIT 6
KAPSON SENIOR QUARTERS CORP.
February 23, 1998
Xxxxx Xxxxxx
Xxxxx X. Xxxxxx
Xxxx X. Xxxxxx
G.W.E. Partnership
000 Xxxxxxxx Xxxx Xxxxxxxxx
Xxxxxxxx, XX 00000
Ladies and Gentlemen:
Reference is made to that certain Amended and Restated Agreement and Plan of
Merger (the "Amended and Restated Merger Agreement") of even date herewith,
among Prometheus Senior Quarters LLC (the "Parent"), Prometheus Acquisition
Corp. (the "Merging Corporation"), and Kapson Senior Quarters Corp. (the
"Company"), pursuant to which the Merging Corporation shall merge with and
into the Company. Capitalized terms used herein and not otherwise defined
shall have the meanings ascribed thereto in the Amended and Restated Merger
Agreement, or, if not defined therein, in the Ancillary Agreements (as defined
in the Escrow Agreement between the Parent, the Merging Corporation, the
Company, Xxxxxx Trust and Savings Bank and the Partners entered into as of
even date herewith).
As an accommodation to the Parent and Merging Corporation, Xxxxx Xxxxxx, Xxxxx
X. Xxxxxx and Xxxx X. Xxxxxx (each individually, a "Partner", and
collectively, the "Partners", and, for the purposes of the indemnity to be
provided by the Company hereunder the term Partner shall include the Partners,
or any partnership, corporation or other entity through which the Partners
operate any facility to the extent of any loss or costs to the Partners' in
their interest in such partnership, corporation or other entity as a result of
any Losses (as defined below)) have agreed to continue to operate certain of
the Facilities for a period of two (2) years, or until qualification of a
person or entity to replace them as operators, whichever shall occur sooner.
In consideration of the foregoing accommodation, and the entry of the Partners
into the Ancillary Agreements, the Company hereby agrees to indemnify, defend,
pay on behalf of, and hold the Partners and their principals, agents and
employees harmless from and against all losses, claims, damages and other
liabilities (including reasonable attorney's fees) arising out of or relating
to their operation of any facility it (or any of its affiliates) owns,
controls, or manages (each, a "Facility") (except those resulting from the
willful misconduct, misappropriation of funds or fraud by the Partners),
including, without limitation, any liabilities asserted against the Partners
or any of their principals, agents or employees by reason of any action or
inaction taken by any of the foregoing while performing the duties of
operators ("Losses") (i) with respect to Losses relating to or arising out of
the Partners' operation of any Facility at or subsequent to the Effective
Time, and (ii) with respect to Losses arising out of or related to the
Partners' operation of any Facility
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for which Partners would have been indemnified by any Owner but for which
Partners cannot receive indemnification from an Owner because of an act or
inducement of the Company at or after the Purchase Date (or its affiliates)
(excluding the act of the Company merging with Merging Corporation).
Indemnification from Company under (ii) of the previous sentence shall be
limited to the amount Partners could otherwise have received from an Owner but
for the act or inducement of the Company.
The Company's obligation hereunder shall survive the termination of all or any
of the Ancillary Agreements or any other agreements entered into between the
Partners and any or all of the Parent, the Merging Corporation, or the Company
dated on or about September 30, 1997 or of even date herewith. In addition,
the obligation under this letter agreement shall not be assignable by the
Company, and shall be binding on any successor thereto.
The terms of this letter agreement shall not be modified or waived except by
written consent of the Partners. This letter may be signed in two or more
counterparts, each of which shall be an original, but all of which taken
together shall constitute one and the same instrument. (For the purposes of
this letter agreement only, Purchase Date is defined as the date of the
purchase of the Shares pursuant to the Offer under the Amended and Restated
Merger Agreement.)
The Company hereby recognizes that the Partners would not enter into the
above-referenced Amended and Restated Merger Agreement and Ancillary
Agreements without the indemnification provided hereby. In consideration
therefor, and for other good and valuable consideration, the Company, by
signing below, hereby agrees to indemnify the Partners as provided
hereinabove.
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IN WITNESS WHEREOF, the Company has entered into this agreement by signing
below, as of the date first written above, and this agreement shall be
effective as of the Purchase Date.
KAPSON SENIOR QUARTERS CORP.
/s/ Xxxxx Xxxxxx
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By: Xxxxx Xxxxxx
Title: Chairman and Chief Executive Officer
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