EXHIBIT 2.2
PURCHASE AGREEMENT
This Purchase Agreement (the "Agreement") is made this ____ day of
December, 2001, by and between Healthcare Properties, L.P., a Delaware limited
partnership, ("Seller") and PRESTON HOLLOW PROPERTIES, LLC, a Texas limited
liability company, with offices at 000 Xxxxxxx, Xxxxx 000, Xxxxxxxxx, Xxxxx
00000 ("Buyer").
WHEREAS, Seller is the owner of a certain 114 licensed bed, Nursing
Home facility situated in Benbrook, Texas, located at 0000 XxXxxxxx Xxxxxx,
Xxxxxxxx, Xxxxx, consisting of a tract of approximately _____ acres of land and
related appurtenances located in Benbrook, Texas. The properties more
particularly described in Exhibit "A" hereto (the "Real Property"), the
buildings and improvements thereon (the "Improvements"), Seller's furnishings
and equipment used and useful to the operation of said facilities, if any (the
"Equipment"), and Seller's rights, if any, in the Certificate of Need or Medical
Certification relating to the Real Property and Improvements (the
"Certification"), which Real Property, Improvements, Equipment, and
Certification are hereinafter collectively referred to as the "Facility".
WHEREAS, both Seller and Buyer have agreed that Seller shall sell and
Buyer shall purchase the Facility upon terms and conditions herein contained.
NOW THEREFORE, in consideration of the mutual covenants herein
contained and intending to be legally bound hereby, the parties hereto agree as
follows:
l. SALE. Subject to the terms and conditions hereof, Seller shall, as
of the closing, by appropriate deed, bills of sale, and assignments, sell,
assign, transfer, convey and deliver the Facility and Buyer shall purchase the
same from Seller.
2. CONSIDERATION. The purchase price for the Facility is One Million
Eight Hundred Thousand Dollars ($1,800,000.00) (the "Purchase Price")
immediately available federal funds at Closing.
3. DEPOSIT. Buyer has delivered to Title Company (defined below) Twenty
Thousand Dollars ($20,000.00) and shall, within forty-eight (48) hours of
execution hereof, deliver an additional Fifty Thousand Dollars ($50,000.00)
(collectively, the "Xxxxxxx Money") as an xxxxxxx money deposit. The Xxxxxxx
Money is non-refundable to Buyer, but shall be applied against the Purchase
Price at Closing (defined below).
4. CLOSING. The closing of the transaction contemplated herein (the
"Closing") shall take place on or before February 28, 2002, unless extended or
shortened by mutual written agreement of Seller and Buyer. Closing shall take
place at the offices of Republic Title Company (the "Title Company"), c/o Xxxxx
Xxxxxx, 0000 Xxxxxx Xxxxxx, 00xx Xxxxx, Xxxxxx, Xxxxx (telephone 000-000-0000;
facsimile 214-855-8852), or at such other place and/or such other time as may be
agreed in writing signed by both Seller an Buyer, which other place and time
shall then be the Closing Date.
5. CONDITION OF TITLE. Seller shall convey or cause to be conveyed, as
applicable, title to the Facility, as follows:
a. Title to Real Property and the Improvements shall be
conveyed in fee simple by Special Warranty Deed ("Deed") and shall be good and
indefeasible and free and clear of all liens and encumbrances (except those
created by this transaction) or other matters affecting title, other than the
Permitted Exceptions (as hereinafter defined) pursuant to a standard Texas
Owner's policy of insurance for the full amount of the Purchase Price, which
policy shall show and insure that legal title will be vested in Buyer and will
be good and indefeasible subject only to the Permitted Exceptions.
b. Title to all Equipment of Seller, if any, shall be free and
clear of all liens, security interests and other encumbrances.
c. Buyer acknowledges that the Facility is currently leased
and agrees to make arrangements with such lessee ("Lessee") concerning its
occupancy or vacating of the Facility. Senior Management Services of Benbrook,
Inc., Buyer's affiliate, also intends to execute a Lease Agreement with Seller
for the Facility, which will be an exception to title as well.
6. TITLE/SURVEY/FACILITY REVIEW.
a. Title Commitment. Within twenty (20) days after execution
of the Agreement, Seller, at its sole cost and expense, shall procure and
deliver to Buyer a current Title Commitment ("Title Commitment") covering the
Real Property. The Title Commitment shall set forth the state of title to the
Real Property, together with all exceptions or conditions to such title,
including, but not limited to, all easements, restrictions, rights-of-way,
covenants, reservations, and all other encumbrances affecting the Real Property
which would appear in an Owner's Title Policy. The Title Commitment shall
contain the express commitment of the Title Company to issue the Title Policy to
Buyer in the amount of the Purchase Price insuring such title to the Real
Property as is specified in the Title Commitment. The Title Company shall
provide Buyer with true, correct and legible copies of all instruments referred
to in the Title Commitment as conditions or exceptions to title to the Real
Property including liens.
b. Survey. Within sixteen (16) days after the execution of the
Agreement, Seller shall deliver to Buyer a survey ("Survey") of the Real
Property and Improvements prepared by a qualified surveyor licensed by the State
of Texas. The Survey shall be certified to Buyer, Seller and the Title Company,
shall state the acreage of the Real Property, accurate to one-one hundredth of
an acre, shall set forth the metes and bounds (or lot and block, if platted)
legal description of the Real Property, and shall otherwise be in a form
satisfactory to the Title Company to amend the standard survey exception on the
title insurance policy to be issued at Closing (but such amendment shall be at
Buyer's cost).
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c. Review by Buyer. Buyer shall have the right, until December
31, 2001, to conduct and approve its due diligence and inspections, to its sole
and exclusive satisfaction, of the title, physical plans, assets, financial,
regulatory and operational information, and any other factors Buyer deems
reasonably necessary regarding the facility and its assets and operations.
Should Buyer decide, during such may terminate this Agreement and the parties
shall have no further obligation except as hereinafter set forth; and the
xxxxxxx money will be returned to the buyer. Seller agrees to make available for
inspection and copying all information in its immediate possession, if any,
including financial data, records, operating data and other information
reasonably requested by Buyer, including the most recent financial statements,
cost reports, inspection reports (3 prior years), plans of correction (3 prior
years), current room rates including dates and amounts of increases, census data
and patient mix, payroll information, employment agreements, personnel policies,
occupancy agreements with patients, leases, and all contracts, agreements, and
other documents relating to outside contractors, vendors, consultants, or other
outside parties relating to the Facility and to which the Facility is, or may
be, a xxxxx. Notwithstanding the foregoing or any other provision of this
Agreement, Seller shall not be required to divulge any information related to
the Facility where such disclosure is reasonably prohibited by Seller's
contractual obligations to a third party. Further, Buyer agrees to treat all
such information as confidential and, in the event the transactions contemplated
hereby are not consummated, Buyer agrees to return all information and copies
thereof to Seller.
d. Title Policy. Following Closing, Seller, at its sole cost
and expense, shall cause the Title Policy to be furnished to Buyer. The Title
Policy shall be issued in the amount of the Purchase Price and shall insure fee
simple, indefeasible title to the Real Property in Buyer. The Title Policy may
contain the Permitted Exceptions, but shall contain no additional exceptions to
title to the Real Property other than the standard printed exceptions.
7. RESPONSIBILITY AND INDEMNIFICATIONS AS TO LIABILITIES. The parties
shall indemnify each other as follows:
a. Buyer shall indemnify and hold harmless Seller and its
partners and its and their officers, directors, members, shareholders,
employees, agents and controlling persons against any and all claims, demands,
suits, damage, liability, loss and expense, including, without limitation,
reasonable attorneys' fees (collectively "Losses") which Seller may sustain or
suffer or to which Seller may become subject as a result of events which occur
subsequent to the date of closing. The foregoing shall survive Closing.
b. Seller shall indemnify and hold harmless Buyer and its
officers, directors, members, shareholders, employees, agents and controlling
persons against any Losses which Buyer may sustain or suffer or to which Buyer
may become subject as a result of any material, intentional, or knowing
misrepresentation under Section 8 of this Agreement.
8. SELLER'S REPRESENTATIONS, WARRANTIES AND COVENANTS.
a. Seller represents and warrants to Buyer as of the execution
of this Agreement and as of the Closing that:
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i. Seller is a duly organized and validly existing
limited partnership in existence under the laws of the State
of Delaware.
ii. Seller is the owner of the Facility with all
requisite power and authority to own the Facility, and carry
on its business as now being conducted, and further has the
power and authority to sell and dispose of the Facility upon
the terms and conditions herein contained.
iii. The execution, delivery, and performance of this
Agreement by Seller and the consummation of the transactions
contemplated hereby have been duly and effectively authorized
by the partners of Seller, and will not violate any indenture,
mortgage, deed of trust or other instrument or agreement, or
any order, judgment or decree to which Seller is subject.
b. Seller covenants with Buyer as follows:
i. From and after the date of this Agreement, Seller
shall make no contracts or commitments which purport to bind
the Facility after the date of Closing, other than those made
in the ordinary course of business, without the written
consent of the Buyer.
ii. As soon as practicable after the execution of
this Agreement and prior to the Closing, Seller shall furnish
to Buyer or its authorized representatives copies of. such
records and documents in Seller's possession that are related
to the Facility (e.g. surveys, building plans, equipment
warranties, etc.) and to the operation thereof (e.g. patient
records, fiscal statements, etc.) as Buyer shall reasonably
request and shall afford Buyer and Buyer's counsel, auditors
and authorized representatives for purposes of inspections,
verifications and related matters full access during normal
business hours to all personnel, properties, records and
documents of Seller and the Facility.
iii. Seller shall cooperate as necessary (without the
expenditure of funds except as specifically provided herein)
to bring about the consummation of the transactions
contemplated by this Agreement.
iv. Seller shall continue to maintain all of Seller's
insurance policies, if any, relating to the Facility, or any
part thereof, in full force and effect until the Closing Date.
v. Seller shall provide Buyer with a copy of any
written governmental notice received by Seller after the date
hereof and prior to the Closing Date related to any violations
of any federal, state or municipal laws, ordinances, orders,
regulations and requirements affecting the Facility.
c. The representations and warranties of Seller in this Section
8 shall survive Closing for a period of one year.
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9. BUYER'S REPRESENTATIONS, WARRANTIES AND COVENANTS.
a. Buyer hereby represents and warrants to Seller as follows:
i. Except as provided in Section 8, Buyer is
purchasing the Facility AS-IS, WHERE-IS, and WITH ALL FAULTS.
Buyer relied on its own investigation of all aspects of the
property being sold hereunder and such was a factor in
determining the Purchase Price.
b. Buyer covenants with Seller as follows:
i. Examinations and inspections by Buyer and its
authorized agents and representatives prior to Closing shall
be undertaken in a manner that does not unnecessarily hinder,
restrict or interfere with the operation of the Facility.
Further, Buyer agrees to indemnify, defend, and hold Seller
harmless from and against any and all claims, damages,
expenses, or losses incurred by or threatened against Seller
based on Buyer's actions at the Facility prior to Closing.
ii. Buyer shall cooperate as necessary to bring about
the consummation of the transactions contemplated by this
Agreement including, without limitation, all necessary
regulatory approvals from state, federal, and local agencies.
iii. Buyer shall negotiate a transition agreement
with the current lessee of the Facility acceptable to the
State of Texas and shall be properly licensed with all
applicable governmental authority approvals.
10. PRORATION OF EXPENSES. The following shall be prorated between
Buyer and Seller (or Seller's lessee, if applicable) at Closing as follows:
a. Ad valorem real property taxes on a calendar year basis,
provided they are not the responsibility of the Lessee;
b. Operating and utility expenses for the month of Closing not
otherwise the responsibility of the Lessee;
c. All deposits, insurance, or other prepaid items paid by
Seller, in connection with the operation of the Facility and which are
to be retained by Buyer,
d. All rental income received by Seller for the month in which
the closing occurs.
e. All other customary prorations for transactions in the
State of Texas.
11. ENVIRONMENTAL MATTERS AND HAZARDOUS MATERIAL. For purposes of this
Section 11, "Hazardous Materials" means any "chemical substances", "hazardous or
toxic wastes" and "oil", as such terms now are respectively defined under the
Federal Comprehensive Environmental Response, Conservation and Liability Act of
1980, 42 U.S.C. Section 9601 et seq., the Hazardous Sites Cleanup Act of October
18, 1988, X.X. 000, Xx. 000, the Federal Toxic Substances Control Act, 15 U.S.C.
Section 2601 et seq., the Federal Water Pollution Control Act, 33 U.S.C. Section
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1321 et seq., the Federal Clean Water Act, 33 U.S.C. Section 1251, et seq., and
the regulations promulgated under all of the foregoing, as all of the foregoing
may have been amended, or similar laws, rules, regulations, orders and decrees
now enacted, including, without limitation, asbestos, asbestos-containing
materials, oil or other petroleum products, polychlorinated biphenyl and other
toxic waste and substances. Seller represents and warrants to Buyer concerning
the Facility that:
a. To the best of Seller's knowledge, Seller has not:
i. caused, suffered or permitted to occur any
condition which may cause a release, threat of release or
discharge of any Hazardous Materials at, upon, under or within
the Facility, and contiguous or adjacent real estate owned,
operated or occupied by Seller.
ii. received notification from any federal, state or
other governmental authority of any potential, known, or
threatened release of any Hazardous Materials on or from the
Facility or any adjacent property owned, occupied, or operated
either by Seller or any person for whose conduct Seller is
responsible and which may result in a lien on the Facility or
the application of any penalty, fine, charge or expense
against the Facility by any such governmental authority, or by
any other person or entity, in connection with the assessment,
containment, or removal of any release or threatened release,
of any Hazardous Materials from the Facility or any adjacent
property.
b. Seller has no knowledge of any release, threat of release,
deposit, storage, disposal, burial, discharge, spillage, uncontrolled seepage or
filtration of any Hazardous Materials at, upon, under or within the Facility or
any contiguous or adjacent real estate (other than minor, incidental spillage of
fuel or oil during the construction of the Facility) owned, operated or occupied
by Seller.
c. Within thirty (30) days after the execution of this
Agreement, Seller shall order, for the benefit of Buyer, a current Phase I
environmental report, which shall be at Seller's cost and expense.
d. For purposes of this Section 11, "Seller's knowledge"
or similar phrase or concept shall mean the current, actual knowledge of the
president or vice-president of Capital Realty Group Senior Housing, Inc., the
general partner of the Seller.
12. CLOSING EVENTS.
a. At Closing, Seller shall deliver to Buyer:
i. The fully executed Deed conveying the Real
Property and Improvements in fee simple, to Buyer;
ii. A fully executed Xxxx of Sale conveying the
personal property, if any, to be delivered to Buyer pursuant
to this Agreement;
iii. An Assignment and Assumption of Contracts
assigning to Buyer all of Seller's interest in any assignable
contracts;
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iv. An Assignment of Warranties and Guaranties, if
any and if assignable;
v. Assignment of Permits and Licenses, to the extent
assignable;
vi. A standard form title company owner's affidavit
as reasonably required by the Title Company for the
elimination of any standard exceptions except parties in
possession listed as exceptions; and
vii. A certificate of non-foreign status (FIRPTA
Certificate) of Seller.
b. At Closing, Buyer shall (i) pay to Seller the Cash Portion
of the Purchase Price, (ii) execute and deliver to Seller the Note and Deed of
Trust, and (iii) deliver organizational documents to Seller confirming Buyer is
a single purpose entity and containing the requirements of Section 9.b.iv.
c. At Closing, Seller and Buyer shall each:
i. Deliver to the Title Company, as closing agent,
and to the other party, evidence reasonably sufficient to
satisfy the Title Company that:
(1) Such party is duly organized;
(2) As of the date of Closing, such party is
validly existing, qualified to do business and in
good standing in the state of its formation and, if
different, in the State of Texas; and
(3) The execution, delivery and performance
of this Agreement has been duly authorized and
approved by Seller and Buyer.
d. The delivery of the documents and the payment of the
sums to be delivered and paid at Closing shall be accomplished through the Title
Company.
e. Possession of the Facility shall be delivered to Buyer
immediately upon Closing.
f. Seller's obligation to close shall be contingent upon
Seller obtaining a full release from the existing lessee at the facility, but
may be waived by Seller.
13. FAILURE OF CLOSING. If the Closing does not occur by reason of
Sellers' failure to complete the Closing without proper cause, then Buyer shall
be entitled to the return of its Xxxxxxx Money as its sole remedy. In no case
shall any of the partners, officers or directors of either Buyer or Seller have
any personal liability whatsoever arising under or in connection with the
Agreement. If the Closing does not occur by reason of the Buyer's failure to
complete the Closing without proper cause, then Seller shall retain the Xxxxxxx
Money deposit as liquidated damages.
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14. NOTICES OF VIOLATIONS. Seller shall notify Buyer of all notices of
violations of local ordinances or requirements issued by legal authority or
prosecutions in any court on account of such violations affecting the Facility
and received by Seller prior to Closing.
15. RISK OF LOSS. Until execution and delivery of the Deed, the risk of
loss or damage to the Facility by fire or other casualty is assumed by Seller.
16. CONDEMNATION. If, at or prior to Closing, any portion of the
Facility shall be condemned or taken pursuant to any governmental or other power
of eminent domain, any written notice of taking or condemnation is issued, or
any proceedings are instituted by any governmental authority having the power of
eminent domain, then Buyer shall have the right to (a) terminate this Agreement
by giving Seller written notice to that effect within ten (10) days after
receiving written notice from Seller advising of the condemnation or taking,
whereupon both Seller and Buyer shall be relieved of further liability under
this Agreement, at law or in equity, or (b) proceed to Closing with a reduction
in Purchase Price equal to the amount of all condemnation awards paid to Seller,
or (c) proceed to Closing without a reduction irk the Purchase Price, in which
case Buyer shall receive at Closing all condemnation awards paid to Seller
subsequent to the date of this Agreement for any part of the Facility. If Seller
has knowledge of any pending or threatened condemnation proceedings or action or
any notices thereof affecting the Facility, Seller will promptly advise Buyer in
writing of the matters and facts relating thereto.
17. COMPLETE AGREEMENT/MODIFICATION. This Agreement sets forth all of
the promises, covenants, agreements, conditions and understandings between the
parties hereto and supersedes all prior and contemporaneous agreements and
understandings, inducements or conditions, express or implied, oral or written,
except as herein contained. Thus Agreement may not be modified other than by an
agreement in writing, signed by both Seller and Buyer.
18. ASSIGNMENT. This Agreement may not be assigned by Buyer without the
prior written consent of Seller.
19. NOTICES. All notices and other communications under this Agreement
shall be in writing and shall be deemed duly given when received if personally
delivered or delivered via overnight courier, or within three (3) days of the
postmark if mailed by registered mail or certified mail, return receipt
requested, first class, postage prepaid:
If to Seller: Healthcare Properties, L.P.
00000 Xxxxxx Xxxxxxx, Xxxxx 000
Xxxxxx, Xxxxx 00000
Attn: Xxxxx Xxxxxxxx
With a copy to: Xxxxxx Xxxxxxxx, President
Capital Realty Group Senior Housing, Inc.
00000 Xxxxxx Xxxxxxx, Xxxxx 000
Xxxxxx, Xxxxx 00000
If to Buyer. c/o Xxxx Xxxxxxx
000 X. Xxxxxxx, Xxxxx 000
Xxxxxxxxx, Xxxxx 00000
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The parties shall be responsible for notifying each other of any change of
address.
20. SURVIVAL. Except as provided herein, the terms and provisions of
this Agreement shall not survive Closing.
21. PARTIAL INVALIDITY. If any term, covenant or condition of this
Agreement is held invalid or unenforceable, it shall be severed and shall not
affect the validity or enforceability of the remaining terms, covenants or
conditions of the Agreement. Each term, covenant and condition shall be valid
and enforceable to the fullest extent permitted by law.
22. INTERPRETATION. The paragraph headings used in this Agreement are
for reference and convenience only and shall not enter into the interpretation
of this Agreement. If any date upon which action is required under this
Agreement shall be a Saturday, Sunday or legal holiday, the date for such action
shall be extended to the first regular business day after such date which is not
a Saturday, Sunday or legal holiday.
23. BINDING EFFECT. Subject to Section 18, all of the covenants,
conditions and obligations contained in this Agreement shall be binding upon and
inure to the benefit of the respective heirs, legal representatives, successors
and assigns of Seller and Buyer.
24. NON-EXCLUSIVE. The parties agree that Seller may continue to market
the Facility during the term of this Agreement; provided, however, that Seller
will notify Buyer of any letters of intent received by Seller for the Facility
during December, 2001, and will not execute any letter of intent, lease (other
than with Buyer), or purchase agreement for the Facility prior to January 3,
2002.
25. APPLICABLE LAW. This Agreement shall be governed by and construed
in accordance with the laws of the State of Texas.
26. EXECUTION OF DOCUMENT. This Agreement maybe executed in multiple
counterparts provided each of the parties hereto executes at least one
counterpart. Each such counterpart hereof shall be deemed an original
instrument, but all such counterparts together shall constitute but one
Agreement.
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement on
the day and year first above written.
BUYER:
PRESTON HOLLOW PROPERTIES, LLC
By:
----------------------------------------
Name:
--------------------------------------
Title:
-------------------------------------
SELLER:
HEALTHCARE PROPERTIES, L.P.
By: Capital Realty Group Senior Housing,
Inc., its General Partner
By:
------------------------------------
Name:
----------------------------------
Title:
---------------------------------
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EXHIBIT "A"
Legal Description of Property
EXHIBIT "B"
Form Note and Deed of Trust
