Exhibit 10.29

 

Execution Copy

 

PURCHASE AND SALE AGREEMENT

 

by and between

 

SHP III/ARBOR ASHEVILLE, LLC, SHP/III ARBOR ATHENS, LLC,

SHP III/ARBOR CASCADE, LLC, SHP III/ARBOR DECATUR, LLC,

SHP III/ARBOR KNOXVILLE, LLC, SHP III BARRINGTON TERRACE, LLC,

SHP III HERON FORT MYERS, LLC, SHP III HERON NAPLES, LLC,

each a Delaware limited liability company,

AND SHP III LAWRENCEVILLE, LLC,

a Georgia limited liability company

 

and

 

AMERICAN REALTY CAPITAL V, LLC,
a Delaware limited liability company

 

Property Names and Locations:

Arbor Terrace of Asheville, Asheville NC

Arbor Terrace of Athens, Athens, GA

Arbor Terrace at Cascade, Atlanta, GA

Arbor Terrace of Decatur, Decatur, GA

Arbor Terrace of Knoxville, Knoxville, TN

Arbor Terrace of Largo, Largo, FL

Barrington Terrace of Fort Myers, Fort Myers, FL

Barrington Terrace of Naples, Naples, FL

Arbor Terrace at Parkside, Decatur, GA

 

Effective Date: May 24, 2013

 

 

 

 

TABLE OF CONTENTS

 

ARTICLE 1 CERTAIN DEFINITIONS 1       ARTICLE 2 SALE OF PROPERTY 9      
ARTICLE 3 PURCHASE PRICE 10         3.1 Earnest Money Deposit 10     3.1.1
Payment of Deposit 10     3.1.2 Applicable Terms; Failure to Make Deposit 10    
        3.2 Cash at Closing 10           3.3 Assumption of Existing Property
Debt 10     3.3.1 Assumption 10     3.3.2 Failure to Obtain Lender Approval 10  
    ARTICLE 4 TITLE MATTERS 11         4.1 Title to Real Property 11          
4.2 Title Defects 11     4.2.1 Buyer’s Objections to Title; Seller’s Obligations
and Rights 11     4.2.2 Discharge of Title Exceptions 12     4.2.3 No New
Exceptions 12             4.3 Title Insurance 12       ARTICLE 5 BUYER’S DUE
DILIGENCE/CONDITION OF THE PROPERTY 13         5.1 Buyer’s Due Diligence 13    
5.1.1 Access to Property 13     5.1.2 Limit on Government Contacts 13     5.1.3
Requested Due Diligence Materials               5.2 As-Is, Where-Is, With All
Faults Sale 13           5.3 Termination of Agreement During Due Diligence
Period 14           5.4 Buyer’s Certificate 14       ARTICLE 6 ADJUSTMENTS AND
PRORATIONS 15         6.1 Lease Rentals 15           6.2 Other Revenues 15      
    6.3 Real Estate and Personal Property Taxes 16     6.3.1 Proration of Ad
Valorem Taxes 16     6.3.2 Insufficient Information 16     6.3.3 Special
Assessments 16     6.3.4 Reassessments 16

 

 

 

 

  6.4 Other Property Operating Expenses 17           6.5 Closing Costs 17      
    6.6 Cash Security Deposits 17           6.7 Apportionment Credit 17        
  6.8 Delayed Adjustment; Delivery of Operating and Other Statements 18      
ARTICLE 7 CLOSING 18         7.1 Closing Date 18           7.2 Title Transfer
and Payment of Purchase Price 18           7.3 Seller’s Closing Deliveries 19  
  (a) Deed 19     (b) Bill of Sale 19     (c) Assignment of Tenant Leases 19    
(d) Assignment of Intangible Property 19     (e) Notice to Tenants 19     (f)
Non-Foreign Status Affidavit 19     (g) Evidence of Authority 19     (h) Closing
Statement 19     (i) Title Affidavit 19     (j) Other Documents 19     (k) Tax
Returns 19     (l) Keys and Original Documents 19             7.4 Buyer Closing
Deliveries 20     (a) Purchase Price 20     (b) Assignment of Leases 20     (c)
Assignment of Intangible Property 20     (d) Buyer’s As-Is Certificate 20    
(e) Evidence of Authority 20     (f) Closing Statement 20     (g) Other
Documents 20     (h) Tax Returns 20             7.5 Termination Following
Outside Closing Date 21       ARTICLE 8 CONDITIONS TO CLOSING 21         8.1
Conditions to Seller’s Obligations 21     (a) Representations True 21     (b)
Buyer’s Financial Condition 21     (c) Buyer’s Deliveries Complete 21          
  8.2 Conditions to Buyer’s Obligations 21     (a) Representations True 21    
(b) Title Conditions Satisfied 21     (c) Seller’s Deliveries Complete 22

 

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    (d) Lender Requirements Fulfilled 22     (e) HSR Compliance 22            
8.3 Waiver of Failure of Conditions Precedent 22           8.4 Approvals not a
Condition to Buyer’s Performance 22       ARTICLE 9 REPRESENTATIONS AND
WARRANTIES 22         9.1 Buyer’s Representations 22     9.1.1 Buyer’s
Authorization 23     9.1.2 Buyer’s Financial Condition 23             9.2
Seller’s Representations 23     9.2.1 Seller’s Authorization 23     9.2.2 Other
Seller’s Representations 24             9.3 General Provisions 27     9.3.1 No
Representation as to Leases 27     9.3.2 Seller’s Warranties Deemed Modified 27
    9.3.3 Notice of Breach; Seller’s Right to Cure 27     9.3.4 Survival;
Limitation on Seller’s Liability 28       ARTICLE 10 COVENANTS 28         10.1
Buyer’s Covenants 28     10.1.1 Confidentiality 28     10.1.2 Buyer’s Indemnity
29             10.2 Seller’s Covenants 29     10.2.1 Service Contracts 29    
10.2.2 Maintenance of Property 30     10.2.3 Post Closing Records 30     10.2.4
Survival 31             10.3 Mutual Covenants 31     10.3.1 Publicity 31    
10.3.2 Brokers 31     10.3.3 Tax Protests, Tax Refunds and Credits 31    
10.3.4   Survival 32       ARTICLE 11 FAILURE OF CONDITIONS 32         11.1 To
Seller’s Obligations 32           11.2 To Buyer’s Obligations 32      
ARTICLE 12 CONDEMNATION/CASUALTY 33         12.1 Right to Terminate 33          
12.2 Allocation of Proceeds and Awards 33           12.3 Insurance 34

 

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  12.4 Waiver 34       ARTICLE 13 ESCROW 34   13.1 Deposit 34   13.2 Delivery 34
  13.3 Failure of Closing 34   13.4 Stakeholder 35   13.5 Taxes 35   13.6
Execution by Escrow Agent 35         ARTICLE 14 Lease Expenses 35   14.1 Leasing
35   14.2 Lease Enforcement 35         ARTICLE 15 MISCELLANEOUS 36   15.1
Buyer’s Assignment 36   15.2 Designation Agreement 36   15.3 Survival/Merger 37
  15.4 Integration/Waiver 37   15.5 Governing Law 37   15.6 Captions Not
Binding; Exhibits 38   15.7 Binding Effect 38   15.8 Severability 38   15.9
Notices 38   15.10 Counterparts 39   15.11 No Recordation 40   15.12 Additional
Agreements; Further Assurances 40   15.13 Construction 40   15.14 Maximum
Aggregate Liability 40   15.15 Time of The Essence 40   15.16 Waiver of Jury
Trial 40   15.17 Facsimile Signatures 41   15.18 Jurisdiction 41

 

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EXHIBITS

 

A-1. Legal Description (Asheville) A-2. Legal Description (Athens) A-3. Legal
Description (Atlanta) A-4. Legal Description (Decatur) A-5. Legal Description
(Knoxville) A-6. Legal Description (Largo) A-7. Legal Description (Fort Myers)
A-8. Legal Description (Naples) A-9. Legal Description (Lawrenceville – Land) B.
Lists of Contracts C. Form of Buyer’s As-Is Certificate and Agreement D. Form of
Special Warranty Deed E. Form of Bill of Sale F. Form of Assignment of Tenant
Leases G. Form of Assignment of Intangible Property H. Form of Notice to Tenants
I. Form of Seller’s Non-Foreign Certificate J. Form of Seller’s Title Affidavit
K. Litigation Notices, Contract Defaults, Governmental Violations L. Lists of
Tenants M. List of Licenses Held N. Government Payor Programs O. Financial
Statements P. Requested Due Diligence Materials

 

SCHEDULES

 

Schedule 1      Allocation of Purchase Price

 

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PURCHASE AND SALE AGREEMENT

 

THIS PURCHASE AND SALE AGREEMENT (this “Agreement”) is made as of May 24, 2013,
by and between SHP III/ARBOR ASHEVILLE, LLC, a Delaware limited liability
company, as to the portion of the Property which is located on or associated
with the Facility described below as “Arbor Terrace of Asheville”, SHP III/ARBOR
ATHENS, LLC, a Delaware limited liability company, as to the portion of the
Property which is located on or associated with the Facility described below as
“Arbor Terrace of Athens”, SHP III/ARBOR CASCADE, LLC, a Delaware limited
liability company, as to the portion of the Property which is located on or
associated with the Facility described below as “Arbor Terrace at Cascade”, SHP
III/ARBOR DECATUR, LLC, a Delaware limited liability company, as to the portion
of the Property which is located on or associated with the Facility described
below as “Arbor Terrace of Decatur”, SHP III/ARBOR KNOXVILLE, LLC, a Delaware
limited liability company, as to the portion of the Property which is located on
or associated with the Facility described below as “Arbor Terrace of Knoxville”,
SHP III BARRINGTON TERRACE, LLC, a Delaware limited liability company, as to the
portion of the Property which is located on or associated with the Facility
described below as “Arbor Terrace of Largo”, SHP III HERON FORT MYERS, LLC, a
Delaware limited liability company, as to the portion of the Property which is
located on or associated with the Facility described below as “Barrington
Terrace of Fort Myers”, SHP III HERON NAPLES, LLC, a Delaware limited liability
company, as to the portion of the Property which is located on or associated
with the Facility described below as “Barrington Terrace of Naples” and SHP III
LAWRENCEVILLE, LLC, a Georgia limited liability company, as to the portion of
the Property which is located on or associated with the Facility described below
as “Arbor Terrace at Parkside” (each of the foregoing entities being sometimes
referred to individually and sometimes collectively as “Seller”), and AMERICAN
REALTY CAPITAL V, LLC, a Delaware limited liability company (“Buyer”).

 

WITNESSETH:

 

In consideration of the mutual covenants and agreements set forth herein the
parties hereto do hereby agree as follows:

 

ARTICLE 1 - CERTAIN DEFINITIONS

 

As used herein, the following terms shall have the following meanings:

 

“Business Day” shall mean any day other than a Saturday, Sunday, or any federal
or state of California holiday. If any period expires on a day which is not a
Business Day or any event or condition is required by the terms of this
Agreement to occur or be fulfilled on a day which is not a Business Day, such
period shall expire or such event or condition shall occur or be fulfilled, as
the case may be, on the next succeeding Business Day.

 

 

 

 

“Buyer’s Reports” shall mean the results of any examinations, inspections,
investigations, tests, studies, analyses, appraisals, evaluations and/or
investigations prepared by or for or otherwise obtained by Buyer or Buyer’s
Representatives in connection with Buyer’s Due Diligence.

 

“Buyer’s Representatives” shall mean Buyer, any direct or indirect owner of any
beneficial interest in Buyer, and any officers, directors, employees, agents,
representatives and attorneys of Buyer or any such direct or indirect owner of
any beneficial interest in Buyer.

 

“Closing” shall mean the closing of the Transaction.

 

“Closing Date” shall mean the date which is the later of (i) August 1, 2013,
(ii) ten (10) Business Days after all Licenses and Permits (as herein defined)
necessary for Buyer or its designee to operate all Facilities (each as presently
operated) are obtained (or, as applicable, the applicable governmental agency or
authority has issued a commitment to issue such Licenses and Permits upon
Closing), and (iii) ten (10) Business Days following notice to Buyer from the
Existing Lender that Lender Approval has been given (or will be given upon
Closing) with respect to Buyer’s assumption of the Existing Property Debt.
Notwithstanding the foregoing, Buyer shall have a one-time right to adjourn
Closing of the Properties up to thirty (30) days with at least two Business
Day’s notice to Seller and simultaneous deposit with Escrow Agent the additional
sum of One Million and No/100 Dollars ($1,000,000.00) with such amount to be
held as part of the Deposit for all purposes hereunder. In no event, however,
shall the Closing Date occur on a date later than the Outside Closing Date.

 

“Closing Tax Year” shall mean the Tax Year in which the Closing Date occurs.

 

“Confidential Materials” shall mean any books, computer software, records or
files (whether in a printed or electronic format) that consist of or contain any
of the following: appraisals; budgets; strategic plans for the Property;
internal analyses; information regarding the marketing of the Property for sale;
submissions relating to obtaining internal authorization for the sale of the
Property by Seller or any direct or indirect owner of any beneficial interest in
Seller; attorney and accountant work product; attorney-client privileged
documents; internal correspondence of Seller, any direct or indirect owner of
any beneficial interest in Seller, or any of their respective affiliates and
correspondence between or among such parties; or other information in the
possession or control of Seller, Seller’s property manager or any direct or
indirect owner of any beneficial interest in Seller which such party deems
proprietary or confidential.

 

“Contracts” shall mean all service, supply, maintenance, utility and commission
agreements, all equipment leases, and all other contracts, subcontracts and
agreements relating to the Real Property and the Personal Property and to which
Seller (or Seller’s property manager) is a party (including all contracts,
subcontracts and agreements relating to the construction of any unfinished
tenant improvements), all of which are described in Exhibit B attached hereto
and incorporated herein by this reference, together with any additional
contracts, subcontracts and agreements entered into in accordance with the terms
of Subsection 10.2.1 hereof and as the same may be modified or terminated in
accordance with the terms of Subsection 10.2.1.

 

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“deemed to know” (or words of similar import) shall have the following meaning:

 

(a)Buyer shall be “deemed to know” of the existence of a fact or circumstance to
the extent that:

 

(i)any Buyer’s Representative has actual knowledge of such fact or circumstance,
or

 

(ii)such fact or circumstance is disclosed by this Agreement, any documents
executed by Seller for the benefit of, and delivered to, Buyer, in connection
with the Closing, the Documents, any estoppel certificate executed by any tenant
of the Property and delivered to Buyer or any Buyer’s Representatives, or any
Buyer’s Reports.

 

(b)Buyer shall be “deemed to know” that any Seller’s Warranty is untrue,
inaccurate or incorrect to the extent that:

 

(i)any Buyer’s Representative has actual knowledge of information which is makes
such Seller’s Warranty untrue, inaccurate or incorrect, or

 

(ii)this Agreement, any documents executed by Seller for the benefit of and
delivered to, Buyer in connection with the Closing, the Documents, any estoppel
certificate executed by any tenant of the Property and delivered to Buyer or any
Buyer’s Representatives, or any Buyer’s Reports contains information which makes
such Seller’s Warranty untrue, inaccurate or incorrect.

 

“Deposit” shall mean the sum of Two Million and No/100ths Dollars ($2,000,000),
to the extent the same is deposited by Buyer in accordance with the terms of
Subsection 3.1.1 hereof, together with any interest earned thereon.

 

“Designated Employees” shall mean John W. Dark, Noah R. Levy, Mark Haberlen and
Christopher Kronenberger.

 

“Documents” shall mean the documents and instruments applicable to the Property
or any portion thereof that Seller or any of the other Seller Parties deliver or
make available to Buyer or Buyer’ Representatives prior to Closing or which are
otherwise obtained by Buyer or Buyer’s Representatives prior to Closing,
including, but not limited to, the Title Commitments, the Surveys, the Title
Documents, and the Property Documents.

 

“Due Diligence” shall mean examinations, inspections, investigations, tests,
studies, analyses, appraisals, evaluations and/or investigations with respect to
the Property, the Documents, and other information and documents regarding the
Property, including, without limitation, examination and review of title
matters, applicable land use and zoning Laws and other Laws applicable to the
Property, the physical condition of the Property, and the economic status of the
Property.

 

- 3 -

 

 

“Due Diligence Period” shall mean the period commencing upon the date this
Agreement is last executed and delivered by Seller or Buyer (as shown below each
party’s signature) and expiring on June 24, 2013.

 

“Escrow Agent” shall mean Stewart Title Guaranty Company, whose mailing address
is One Washington Mall, Suite 1400, Boston, MA 02108 Attention: Terrance Miklas,
in its capacity as escrow agent.

 

“ERISA” shall mean the Employee Retirement Income Security Act of 1974, as
amended.

 

“Existing Lender” means collectively Fannie Mae with respect to both the
Existing Property Debt upon the Arbor Terrace-Decatur Property and the Existing
Property Debt upon the Arbor Terrace-Asheville Property.

 

“Existing Property Debt” means collectively the existing debts of Seller to the
Existing Lender secured by a first-priority security interest in the Purchased
Property located at Arbor Terrace-Decatur and Arbor Terrace-Asheville, which (i)
with respect to the Arbor Terrace-Decatur Property was originally issued in an
amount equal to $11,100,000.00, had an estimated balance of $11,089,500.00 as of
March 1, 2013, is due and payable on January 1, 2018 and has an interest rate of
5.49% per annum with payments based upon a thirty (30) year amortization
schedule throughout the remainder of the term, and (ii) with respect to the
Arbor Terrace-Asheville was originally issued in an amount equal to
$9,600,000.00, had an estimated balance of $9,600,000.00 as of March 1, 2013, is
due and payable on February 1, 2018 and has an interest rate of 5.49% per annum
with payments based upon a thirty (30) year amortization schedule throughout the
remainder of the term.

 

“Facility” or “Facilities” shall mean, individually or collectively, as the
context indicates, the portion of the Property which is located on, associated
with or attributable to:

 

(i)          the senior housing facility located at 3199 Sweeten Creek Road,
Asheville, North Carolina 28803, consisting of a total of 63 units, 46 of which
are assisted living and 17 of which are memory care units and commonly known as
“Arbor Terrace of Asheville”;

 

(ii)         the senior housing facility located at 170 Marilyn Farmer Way,
Athens, Georgia 30606, consisting of a total of 56 units, 41 of which are
assisted living and 15 of which are memory care units and commonly known as
“Arbor Terrace of Athens”;

 

(iii)        the senior housing facility located at 1001 Research Center Atlanta
Drive SW, Atlanta, Georgia 30331, consisting of a total of 68 units, 47 of which
are assisted living and 21 of which are memory care units and commonly known as
“Arbor Terrace at Cascade”;

 

(iv)        the senior housing facility located at 425 Winn Way, Decatur,
Georgia 30030, consisting of a total of 66 units, 43 of which are assisted
living and 23 of which are memory care units and commonly known as “Arbor
Terrace of Decatur”;

 

- 4 -

 

 

 

(v)         the senior housing facility located at 9051 Cross Park Drive,
Knoxville, Tennessee 37923, consisting of a total of 84 units, 55 of which are
assisted living and 29 of which are memory care units and commonly known as
“Arbor Terrace of Knoxville”;

 

(vi)        the senior housing facility located at 333 16th Avenue SE, Largo,
Florida 33771, consisting of a total of 66 units, 43 of which are assisted
living and 23 of which are memory care units and commonly known as “Arbor
Terrace of Largo”;

 

(vii)       the senior housing facility located at 9731 Commerce Center Court,
Fort Myers, Florida 33908, consisting of a total of 117 units, 89 of which are
assisted living and 28 of which are memory care units and commonly known as
“Barrington Terrace of Fort Myers”;

 

(viii)      the senior housing facility located at 5175 East Tamiami Trail,
Naples, Florida 34113, consisting of a total of 120 units, 89 of which are
assisted living and 31 of which are memory care units and commonly known as
“Barrington Terrace of Naples”; and

 

(ix)         that certain parcel of real property located at 1899 Lawrenceville
Highway, Decatur, Georgia 30030 and consisting of approximately 3.78 acres which
is being held for the development of a senior housing facility to be known as
“Arbor Terrace at Parkside”.

 

“Hazardous Materials” shall mean any substance, chemical, waste or material that
is or becomes regulated by any federal, state or local governmental authority
because of its toxicity, infectiousness, radioactivity, explosiveness,
ignitability, corrosiveness or reactivity, including, without limitation,
asbestos or any substance containing more than 0.1 percent asbestos, the group
of compounds known as polychlorinated biphenyls, flammable explosives, oil,
petroleum or any refined petroleum product.

 

“Laws” shall mean all municipal, county, state or federal statutes, codes,
ordinances, laws, rules or regulations.

 

“Leases” shall mean all leases for residential tenants of the Real Property on
the Closing Date.

 

“Liabilities” shall mean, collectively, any and all losses, costs, damages,
claims, liabilities, expenses, demands or obligations of any kind or nature
whatsoever.

 

“Major Casualty/Condemnation” shall mean, as to each Facility:

 

(a)with respect to any condemnation or eminent domain proceedings that occurs
after the date hereof, the portion of the Property that is the subject of such
proceedings has a value in excess of One Million and No/100 Dollars
($1,000,000.00), as reasonably determined by Seller; and

 

(b)with respect to any casualty that occurs after the date hereof, either
(i) the casualty is an uninsured casualty and Seller, in its sole and absolute
discretion, does not elect to cause the damage to be repaired or restored or
give Buyer a credit at Closing for such repair or restoration, or (ii) the
portion of the Property that is damaged or destroyed has a cost of repair that
is in excess of One Million and No/100 Dollars ($1,000,000.00), as reasonably
determined by Seller.

 

- 5 -

 

 

“Other Property Rights” shall mean, collectively, Seller’s interest in and to
all of the following: (a) to the extent that the same are in effect as of the
Closing Date, any licenses, permits and other written authorizations necessary
for the use, operation or ownership of the Real Property, and (b) any guaranties
and warranties in effect with respect to any portion of the Real Property or the
Personal Property as of the Closing Date, and (c) the rights of Seller (if any)
to the names “Arbor Terrace of Asheville”, “Arbor Terrace of Athens”, “Arbor
Terrace at Cascade”, “Arbor Terrace of Decatur”, “Arbor Terrace of Knoxville”,
Arbor Terrace of Largo”, “Barrington Terrace of Fort Myers”, “Barrington Terrace
of Naples” and “Arbor Terrace at Parkside” (it being acknowledged by Buyer that
Seller does not have exclusive rights (and in fact may have no rights) to use
such name and that Seller has not registered the same in any manner).

 

“Outside Closing Date” shall mean October 31, 2013.

 

“Owner’s Title Policies” shall mean an ALTA Owner’s Form of title insurance
policy (or such other comparable form of title insurance policy as is available
in the jurisdiction in which the Property is located) in the form of the Title
Commitments, for each of the parcels that comprise the Real Property, in the
amount of the Purchase Price allocated to each Facility.

 

“Permitted Exceptions” shall mean and include all of the following, subject to
the rights of Buyer to object to matters of title and survey pursuant to
Article 4 hereof and the right of Buyer to terminate this Agreement pursuant to
Article 5 hereof: (a) applicable zoning and building ordinances and land use
regulations, (b) all liens, encumbrances, covenants, conditions, restrictions,
easements and other matters of record listed on Schedule B of the Title
Commitments, including the Title Company’s standard printed exceptions to the
extent Buyer waives or is deemed to have waived such matters pursuant to Section
4.2 herein, (c) such state of facts as disclosed in a Surveys and physical
inspection of the Property to the extent Buyer waives or is deemed to have
waived such matters pursuant to Section 4.2 herein, (d) the lien of taxes and
assessments not yet due and payable (it being agreed by Buyer and Seller that if
any tax or assessment is levied or assessed with respect to the Property after
the date hereof and the owner of the Property has the election to pay such tax
or assessment either immediately or under a payment plan with interest, Seller
may elect to pay under a payment plan, which election shall be binding on
Buyer), (e) any exceptions caused by Buyer or any Buyer’s Representative,
(f) the rights of the tenants under the Leases, and (g) any matters deemed to
constitute additional Permitted Exceptions under Subsection 4.2.1 hereof.
Notwithstanding any provision to the contrary contained in this Agreement or any
of the documents to be executed in connection herewith or pursuant hereto, any
or all of the Permitted Exceptions may be omitted by Seller from the Deed (as
defined in Subsection 7.3(a)) without giving rise to any liability of Seller,
irrespective of any covenant or warranty of Seller contained in the Deed (which
provisions shall survive the Closing and not be merged therein).

 

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“Personal Property” shall mean, collectively, (a) all tangible personal property
owned by Seller that is located on the Real Property on which the applicable
Facility is operated and used in the ownership, operation and maintenance of
that portion of the Real Property, and (b) all books, records and files of
Seller relating to the applicable Real Property or the applicable Leases; but
specifically excluding from the items described in both clauses (a) and (b), any
Confidential Materials and any computer software that is licensed to Seller.

 

“Property” shall mean, collectively, with respect to each of the Facilities
(a) the Real Property, (b) the Personal Property, (c) Seller’s interest as
landlord in all Leases; (d) to the extent assignable, the Contracts, and (e) to
the extent assignable, the Other Property Rights.

 

“Property Documents” shall mean, collectively, with respect to each of the
Facilities (a) the Leases, (b) the Contracts, and (c) any other documents or
instruments which constitute, evidence or create any portion of the Property.

 

“Purchase Price” shall mean the sum of One Hundred Forty-Three Million and
No/100 Dollars ($143,000,000.00), less the Assumed Debt and subject to other
adjustments as provided herein, which Purchase Price is conclusively agreed by
Seller and Buyer to be allocated among the Facilities as shown on Schedule 1
attached hereto and made a part hereof.

 

“Real Property” shall mean, with respect to the Facility known as (i) Arbor
Terrace of Asheville, that certain parcel of real estate located at 3199 Sweeten
Creek Road, Asheville, North Carolina 28803, (ii) Arbor Terrace of Athens, that
certain parcel of real estate located at 170 Marilyn Farmer Way, Athens, Georgia
30606, (iii) Arbor Terrace at Cascade, that certain parcel of real estate
located at 1001 Research Center Atlanta Drive SW, Atlanta, Georgia 30331, (iv)
Arbor Terrace of Decatur, that certain parcel of real estate located at 425 Winn
Way, Decatur, Georgia 30030, (v) Arbor Terrace of Knoxville, that certain parcel
of real estate located at 9051 Cross Park Drive, Knoxville, Tennessee 37923,
(vi) Arbor Terrace of Largo, that certain parcel of real estate located at 333
16th Avenue SE, Largo, Florida 33771, (vii) Barrington Terrace of Fort Myers,
that certain parcel of real estate located at 9731 Commerce Center Court, Fort
Myers, Florida 33908, (viii) Barrington Terrace of Naples, that certain parcel
of real estate located at 5175 East Tamiami Trail, Naples, Florida 34113, and
(ix) Arbor Terrace at Parkside, that certain parcel of real property located at
1899 Lawrenceville Highway, Decatur, Georgia 30030, as legally described in
Exhibit A-1, Exhibit A-2, Exhibit A-3, Exhibit A-4, Exhibit A-5, Exhibit A-6,
Exhibit A-7, Exhibit A-8, and Exhibit A-9, respectively, attached hereto and
incorporated herein by this reference, together with all buildings, improvements
and fixtures located thereon and owned by Seller as of the Closing Date and all
right, title and interest, if any, that Seller may have in and to all rights,
privileges and appurtenances pertaining thereto including all of Seller’s right,
title and interest, if any, in and to all rights-of-way, open or proposed
streets, alleys, easements, strips or gores of land adjacent thereto; provided,
however, that in the event of any condemnation or casualty that occurs after the
date hereof, the term “Real Property” shall not include any of the foregoing
that is destroyed or taken as a result of any such condemnation proceeding.

 

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“Remove” with respect to any exception to title shall mean that Seller causes
the Title Company to remove or affirmatively insure over the same as an
exception to the Owner’s Title Policies for the benefit of Buyer, without any
additional cost to Buyer, whether such removal or insurance is made available in
consideration of payment, bonding, indemnity of Seller or otherwise.

 

“Rents” shall mean all monthly rents due from the tenants of the Property under
the Leases.

 

“Required Removal Exceptions” shall mean, collectively, any Title Objections to
the extent (and only to the extent) that the same (a) have not been caused by
Buyer or any Buyer’s Representatives, and (b) are either:

 

(i)liens evidencing monetary encumbrances (other than liens for non-delinquent
general real estate taxes or assessments) (“Monetary Liens”) which can be
Removed by payment of liquidated amounts but only if such Monetary Liens have
been created by written instrument signed by Seller or assumed by written
instrument signed by Seller or which are the result of the act or omission of
Seller, or

 

(ii)liens or encumbrances (including, but not limited to, Monetary Liens)
created by Seller after the date of this Agreement in violation of
Subsection 4.2.3.

 

“Seller-Allocated Amounts” shall mean, collectively:

 

(a)with respect to any condemnation or eminent domain proceedings with respect
to any portion of the Property that occurs after the date hereof, (i) the costs,
expenses and fees, including reasonable attorneys’ fees, expenses and
disbursements, incurred by Seller in connection with obtaining payment of any
award or proceeds in connection with any such condemnation or eminent domain
proceedings, and (ii) any portion of any such award or proceeds that is
allocable to loss of use of the Property prior to Closing; and

 

(b)with respect to any casualty to any portion of the Property that occurs after
the date hereof, (i) the costs, expenses and fees, including reasonable
attorneys’ fees, expenses and disbursements, incurred by Seller in connection
with the negotiation and/or settlement of any casualty claim with an insurer
with respect to the Property, (ii) the proceeds of any rental loss, business
interruption or similar insurance that are allocable to the period prior to the
Closing Date, and (iii) the reasonable and actual costs incurred by Seller in
stabilizing and/or repairing the Property following a casualty.

 

“Seller’s Broker” shall mean Cassidy Turley, Inc.

 

“Seller’s Knowledge” or words of similar import shall refer only to the actual
knowledge of the Designated Employees following reasonable inquiry and shall not
be construed to refer to the knowledge of any other Seller Party. For the
purposes of the foregoing “reasonable inquiry” shall mean inquiry by John Dark
(one of the Designated Employees) with Judd Harper (a representative of Seller’s
property manager). There shall be no personal liability on the part of the
Designated Employees arising out of any of the Seller’s Warranties.

 

- 8 -

 

 

“Seller Parties” shall mean and include, collectively, (a) Seller; (b) its
counsel; (c) Seller’s Broker; (d) Seller’s property manager, (e) any direct or
indirect owner of any beneficial interest in Seller, (f) any officer, director,
employee, or agent of Seller, its counsel, Seller’s Broker, Seller’s property
manager or any direct or indirect owner of any beneficial interest in Seller;
and (g) any other entity or individual affiliated or related in any way to any
of the foregoing.

 

“Seller’s Warranties” shall mean Seller’s representations and warranties set
forth in Section 9.2 and the limited warranty of title set forth in the deeds
executed by Seller in connection with Closing as the same may be deemed modified
or waived by Buyer pursuant to this Agreement.

 

“Surveys” shall mean a survey of each of the parcels that comprise the Real
Property to be obtained as set forth in Article 4.

 

“Tax Year” shall mean the year period commencing on January 1 of each calendar
year and ending on December 31 of each calendar year.

 

“Title Commitments” shall mean that certain commitment to issue an Owner’s
Policy of Title Insurance with respect to the Property to be issued by the Title
Company.

 

“Title Company” shall mean Stewart Title Guaranty Company.

 

“Title Documents” shall mean all documents referred to on Schedule B of the
Title Commitments as exceptions to coverage.

 

“Title Objections” shall mean any exceptions to title to which Buyer is entitled
and timely objects in accordance with the terms of Subsection 4.2.1(a).

 

“Transaction” shall mean the transaction contemplated by this Agreement.

 

ARTICLE 2 - SALE OF PROPERTY

 

Seller agrees to sell, transfer and assign and Buyer agrees to purchase, accept
and assume, subject to the terms and conditions set forth in this Agreement and
the Exhibits attached hereto, all of Seller’s right, title and interest in and
to the Property.

 

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ARTICLE 3 - PURCHASE PRICE

 

In consideration of the sale of the Property to Buyer, Buyer shall pay to Seller
an amount equal to the Purchase Price, as prorated and adjusted as set forth in
Article 6, Section 7.2, or as otherwise provided under this Agreement. The
Purchase Price shall be allocated between the nine (9) Facilities as shown on
Schedule 1.

 

3.1Earnest Money Deposit.

 

3.1.1           Payment of Deposit. No later than 5:00 p.m. Eastern Time on the
third (3rd) Business Day following the date hereof (provided that this Agreement
is not sooner terminated in accordance with the terms hereof) and as a condition
precedent to the continued effectiveness and enforceability of this Agreement,
Buyer shall make the Deposit in immediately available funds with Escrow Agent.

 

 

3.1.2           Applicable Terms; Failure to Make Deposit. Except as expressly
otherwise set forth herein, the Deposit shall be applied against the Purchase
Price on the Closing Date and shall otherwise be held and delivered by Escrow
Agent in accordance with the provisions of Article 13. Notwithstanding any
provision in this Agreement to the contrary, if Buyer fails to timely make the
Deposit as provided herein, at Seller’s option, Buyer shall be deemed to have
elected to terminate this Agreement and, if Seller elects such option, the
parties shall have no further rights or obligations hereunder except for
obligations which expressly survive the termination of this Agreement.

 

3.2           Cash at Closing. On the Closing Date, Buyer shall pay to Seller an
amount equal to the Purchase Price in immediately available funds by wire
transfer as more particularly set forth in Section 7.2, as prorated and adjusted
as set forth in Article 6, Section 7.2, or as otherwise provided under this
Agreement, and, as a portion of such payment, Buyer may cause the Escrow Agent
to pay to Seller such portion of the Deposit as Buyer requires in immediately
available funds by wire transfer as more particularly set forth in Section 7.2.

 

3.3Assumption of Existing Property Debt.

 

3.3.1           Assumption. Promptly following execution of this Agreement,
Seller and Buyer shall work together to obtain the Existing Lender’s approval
(the “Lender Approval”) to an assumption of the Existing Property Debt by Buyer
at Closing. All costs and fees related to Buyer’s assumption of the Existing
Property Debt, including without limitation any assumption fees and lender's
legal fees, shall be paid by Buyer. Buyer will receive a credit (the “Assumed
Debt Credit”) against Buyer’s obligation to pay the Purchase Price at Closing
for the (i) the unpaid principal amount and all accrued and unpaid interest of
the Existing Property Debt assumed by Buyer, less (ii) the balance of any FF&E
replacement reserves or similar reserves held by Existing Lender as of the
Closing Date which are not released to Seller as of Closing.

 

3.3.2           Failure To Obtain Lender Approval. If the Existing Lender does
not provide its consent to the Buyer’s assumption of the Existing Property Debt
within ninety (90) days after the date hereof (such applicable period, the
“Approval Period”), Buyer shall have the absolute right to terminate this
Agreement by written notice to Seller, promptly after which any Deposit shall be
returned to Buyer and, thereafter, the parties shall have no further rights or
obligations hereunder except for obligations which expressly survive the
termination of this Agreement.

 

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ARTICLE 4 - TITLE MATTERS

 

4.1         Title to Real Property. Buyer shall use good faith and reasonable
efforts to obtain the Title Commitments, copies of all of the Title Documents,
and the Surveys as soon as reasonably practicable after the date hereof. Buyer
shall notify Seller when it receives any of the aforementioned documents and
shall promptly furnish Seller copies of the same. The cost and expense of the
foregoing shall be borne by the parties in accordance with Section 6.5 hereof.

 

4.2         Title Defects.

 

4.2.1           Buyer’s Objections to Title; Seller’s Obligations and Rights.

 

(a)          Prior to the end of the Due Diligence Period, Buyer shall have the
right to object in writing to any title matters that appear on the Title
Commitments, the Surveys, and any supplemental title reports or updates to the
Title Commitments (whether or not such matters constitute Permitted Exceptions).
In addition, after the expiration of the Due Diligence Period, Buyer shall have
the right to object in writing to any title matters that are not Permitted
Exceptions and that materially adversely affect Buyer’s title to the Real
Property if such matters appear on any supplemental title reports or updates to
the Title Commitments issued after the expiration of the Due Diligence Period
and if such matters are placed of record after the effective date of the Title
Commitments received prior to the expiration of the Due Diligence Period, so
long as such objection is made by Buyer within five (5) Business Days after
Buyer becomes aware of the same (but, in any event, prior to the Closing Date).
Unless Buyer is entitled to and timely objects to such title matters, all such
title matters shall be deemed to constitute additional Permitted Exceptions.

 

(b)          If this Agreement is not terminated by Buyer in accordance with the
provisions hereof, Seller shall, at Closing, Remove or cause to be Removed any
Title Objections to the extent (and only to the extent) that the same constitute
Required Removal Exceptions. In addition, Seller may elect (but shall not be
obligated) to Remove or cause to be Removed any other Title Objections. To the
extent that the same do not constitute Required Removal Exceptions, Seller may
notify Buyer in writing after receipt of Buyer’s notice of Title Objections
(but, in any event, prior to the Closing Date) whether Seller elects to Remove
the same (and the failure to provide such notice within five (5) Business Days
after the date of Buyer’s notice of Title Objections shall be deemed to
constitute an election of Seller not to effect any such cure). If Seller elects
not to Remove one or more Title Objections (or is deemed to have so elected),
then, within five (5) Business Days after Seller’s election (but, in any event,
prior to the Closing Date), Buyer may elect in writing to either (i) terminate
this Agreement, in which event the Deposit shall be paid to Buyer and,
thereafter, the parties shall have no further rights or obligations hereunder
except for obligations which expressly survive the termination of this
Agreement, or (ii) waive such Title Objections and proceed to Closing. Failure
of Buyer to respond in writing within such period shall be deemed an election by
Buyer to waive such Title Objections and proceed to Closing. Any such Title
Objection so waived (or deemed waived) by Buyer shall be deemed to constitute a
Permitted Exception and the Closing shall occur as herein provided without any
reduction of or credit against the Purchase Price.

 

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(c)          If Seller is unable to Remove any Required Removal Exceptions or
any other Title Objection that it has previously elected to Remove prior to the
Closing, Buyer may at Closing elect to either (a) terminate this Agreement, in
which event the Deposit shall be paid to Buyer and, thereafter, the parties
shall have no further rights or obligations hereunder except for obligations
which expressly survive the termination of this Agreement, in which case Seller
will reimburse Buyer for its actual, out of pocket third party expenses incurred
in connection with entering into this Agreement and pursuing the Transaction,
and its due diligence investigation of the of the same, not to exceed Two
Hundred Thousand and No/100ths Dollars ($200,000.00), or (b) waive such Title
Objection and the Closing shall occur as herein provided without any reduction
of or credit against the Purchase Price.

 

(d)          Seller shall be entitled to a reasonable adjournment of the Closing
(not to exceed thirty (30) days) for the purpose of the Removal of any Required
Removal Exceptions or other Title Objections.

 

4.2.2      Discharge of Title Exceptions. If on the Closing Date there are any
Required Removal Exceptions or any other Title Objections which Seller has
elected in writing to pay and discharge, Seller may use any portion of the
Purchase Price to satisfy the same, provided Seller shall cause the Title
Company to Remove the same.

 

4.2.3      No New Exceptions. From and after the date hereof, Seller shall not
execute any deed, easement, restriction, covenant or other matter affecting
title to the Property unless Buyer has received a copy thereof and has approved
the same in writing. If Buyer fails to object in writing to any such proposed
instrument within three (3) Business Days after receipt of the aforementioned
notice, Buyer shall be deemed to have approved the proposed instrument. Buyer’s
consent shall not be unreasonably withheld or delayed with respect to any such
instrument that is proposed prior to the end of the Due Diligence Period. Buyer,
in its sole and absolute discretion, shall be entitled to grant or withhold its
consent with respect to any such instrument that is proposed between the end of
the Due Diligence Period and the Closing.

 

4.3         Title Insurance. At Closing, the Title Company shall issue the
Owner’s Title Policies to Buyer, insuring that title to the Real Property is
vested in Buyer subject only to the Permitted Exceptions. Buyer shall be
entitled to request that the Title Company provide such endorsements (or
amendments) to the Owner’s Title Policies as Buyer may reasonably require,
provided that (a) such endorsements (or amendments) shall be at no cost to, and
shall impose no additional liability on, Seller (other than the provision of
customary affidavits or similar documentation from Seller), (b) Buyer’s
obligations under this Agreement shall not be conditioned upon Buyer’s ability
to obtain such endorsements and, if Buyer is unable to obtain such endorsements,
Buyer shall nevertheless be obligated to proceed to close the Transaction
without reduction of or set off against the Purchase Price, and (c) the Closing
shall not be delayed as a result of Buyer’s request.

 

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ARTICLE 5 – BUYER’S DUE DILIGENCE/CONDITION OF THE PROPERTY

 

5.1         Buyer’s Due Diligence.

 

5.1.1           Access to Property. Between the date hereof and the Closing Date
Seller shall allow Buyer and Buyer’s Representatives access to the Property upon
reasonable prior notice at reasonable times provided (a) such access does not
unreasonably interfere with the operation of the Property or the rights of
tenants; (b) Buyer shall not contact any tenant without Seller’s prior written
consent; and (c) Seller or its designated representative shall have the right to
pre-approve and be present during any physical testing of the Property. In
addition, Seller will make or cause to be made available to Buyer for copying,
at Buyer’s sole cost and expense, the property files of Seller and the
management agent for the Property (other than those files containing
Confidential Materials). Buyer shall immediately return the Property to the
condition existing prior to any tests and inspections. Prior to such time as
Buyer or any of Buyer’s Representatives enter the Property, Buyer shall
(i) obtain policies of general liability insurance which insure Buyer and
Buyer’s Representatives with liability insurance limits of not less than
$3,000,000 combined single limit for personal injury and property damage and
name Seller and Seller’s property manager as additional insureds and which are
with such insurance companies, provide such coverages and carry such other
limits as Seller shall reasonably require, and (ii) provide Seller with
certificates of insurance evidencing that Buyer has obtained the aforementioned
policies of insurance.

 

5.1.2           Limit on Government Contacts. Notwithstanding any provision in
this Agreement to the contrary, except in connection with the preparation of a
so-called “Phase I” environmental report with respect to the Property, Buyer
shall not contact any governmental official or representative regarding
hazardous materials on or the environmental condition of the Property without
Seller’s prior written consent thereto, which consent shall not be unreasonably
withheld or delayed. In addition, if Seller’s consent is obtained by Buyer,
Seller shall be entitled to receive at least five (5) days prior written notice
of the intended contact and to have a representative present when Buyer has any
such contact with any governmental official or representative.

 

5.2         As-Is, Where-Is, With All Faults Sale. Buyer acknowledges and agrees
as follows:

 

(a)          During the Due Diligence Period, Buyer has conducted (or has waived
its right to conduct), and shall continue to conduct, such Due Diligence as
Buyer has deemed or shall deem necessary or appropriate.

 

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(b)          Except for Seller’s Warranties, the Property shall be sold, and
Buyer shall accept possession of the Property on the Closing Date, “AS IS, WHERE
IS, WITH ALL FAULTS”, with no right of setoff or reduction in the Purchase
Price.

 

(c)          Except for Seller’s Warranties, none of the Seller Parties have or
shall be deemed to have made any verbal or written representations, warranties,
promises or guarantees (whether express, implied, statutory or otherwise) to
Buyer with respect to the Property, any matter set forth, contained or addressed
in the Documents (including, but not limited to, the accuracy and completeness
thereof) or the results of Buyer’s Due Diligence.

 

(d)          Buyer shall independently confirm to its satisfaction all
information that it considers material to its purchase of the Property or the
Transaction except for Seller’s Warranties, upon which Buyer is entitled to
rely.

 

In addition, Buyer expressly understands and acknowledges that it is possible
that unknown Liabilities may exist with respect to the Property and that Buyer
explicitly took that possibility into account in determining and agreeing to the
Purchase Price, and that a portion of such consideration, having been bargained
for between parties with the knowledge of the possibility of such unknown
Liabilities shall be given in exchange for a full accord and satisfaction and
discharge of all such Liabilities. Notwithstanding the foregoing, such
acknowledgment is not intended to, and shall not be construed to, (i) effect any
contractual assumption of liability as to matters which are not expressly
assumed by Buyer in the documents executed by the parties in connection with the
Transaction, or (ii) affect or impair any rights or remedies that Buyer may have
against Seller as a result of a breach of any of Seller’s Warranties.

 

5.3           Termination of Agreement During Due Diligence Period. If Buyer, in
its sole and absolute discretion, is not satisfied with the results of its Due
Diligence during the Due Diligence Period, Buyer may terminate this Agreement by
written notice to Seller at any time prior to 5:00 p.m. Eastern Time on the last
day of the Due Diligence Period, and, in the event of such termination, Buyer
shall have no further rights whatsoever to acquire all or any portion of the
Property and neither Seller nor Buyer shall have any liability hereunder except
for those obligations which expressly survive the termination of this Agreement
and Buyer shall be entitled to the return of the Deposit. In the event Buyer
fails to terminate this Agreement prior to 5:00 p.m. Eastern Time on the last
day of the Due Diligence Period, Buyer shall be deemed to have waived its rights
to terminate this Agreement in accordance with this Article 5. If after the
expiration of the Due Diligence Period Buyer conducts further Due Diligence,
Buyer acknowledges and agrees that Buyer shall have no further right to
terminate this Agreement with respect to such further Due Diligence or otherwise
in accordance with this Article 5 after the expiration of the Due Diligence
Period, provided that the foregoing shall in no way limit or restrict Buyer’s
other rights hereunder or otherwise.

 

5.4           Buyer’s Certificate. Buyer shall deliver to Seller at the Closing,
a certificate in the form of Exhibit C attached hereto and incorporated herein
by this reference.

 

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ARTICLE 6 - ADJUSTMENTS AND PRORATIONS

 

The following adjustments and prorations shall be made at Closing:

 

6.1           Lease Rentals. All collected Rents shall be prorated between
Seller and Buyer as of 12:01 a.m. on the Closing Date. Seller shall be entitled
to all Rents attributable to any period prior to but not including the Closing
Date. Buyer shall be entitled to all Rents attributable to any period on and
after the Closing Date. Rents not collected as of the Closing Date shall not be
prorated at the time of Closing. After Closing, Buyer shall make a good faith
effort to collect any Rents not collected as of the Closing Date on Seller’s
behalf and to tender the same to Seller upon receipt (which obligation of Buyer
shall survive the Closing and not be merged therein); provided, however, that
all Rents collected by Buyer on or after the Closing Date shall first be applied
to all amounts due under the Leases at the time of collection (i.e., current
Rents and sums due Buyer as the current owner and landlord) with the balance (if
any) payable to Seller, but only to the extent of amounts delinquent and
actually due Seller. Buyer shall not have an exclusive right to collect the sums
due Seller under the Leases and Seller hereby retains its rights to pursue
claims against any tenant under the Leases for sums due with respect to periods
prior to the Closing Date; provided, however, that Seller (i) shall be required
to notify Buyer in writing of its intention to commence or pursue such legal
proceedings; (ii) shall only be permitted to commence or pursue any legal
proceedings after the date which is ninety (90) days after Closing; and
(iii) shall not be permitted to commence or pursue any legal proceedings against
any tenant seeking eviction of such tenant or the termination of the underlying
lease. The terms of the immediately preceding sentence shall survive the Closing
and not be merged therein.

 

6.2           Other Revenues. Revenues from Property operations [other than
Rents (which shall be prorated as provided in Subsection 6.1.1) and security
deposits (which will be apportioned as provided in Section 6.6)] that are
actually collected shall be prorated between Buyer and Seller as of 12:01 a.m.
on the Closing Date. Seller shall be entitled to all such revenues attributable
to any period to but not including the Closing Date and Buyer shall be entitled
to all such revenues attributable to any period on and after the Closing Date.
After Closing, Buyer shall make a good faith effort to collect any such revenues
not collected as of the Closing Date on Seller’s behalf and to tender the same
to Seller upon receipt (which obligation of Buyer shall survive the Closing and
not be merged therein); provided, however, that all such revenues collected by
Buyer on or after the Closing Date shall first be applied to all amounts due to
Buyer at the time of collection (i.e., current sums due to Buyer as the current
owner and landlord) with the balance (if any) payable to Seller, but only to the
extent of amounts delinquent and actually due Seller. Buyer shall not have an
exclusive right to collect such revenues and Seller hereby retains its rights to
pursue claims against any parties for sums due with respect to periods prior to
the Closing Date; provided, however, that Seller (i) shall be required to notify
Buyer in writing of its intention to commence or pursue such legal proceedings;
(ii) shall only be permitted to commence or pursue any legal proceedings after
the date which is ninety (90) days after Closing; and (iii) shall not be
permitted to commence or pursue any legal proceedings against any tenant seeking
eviction of such tenant or the termination of the underlying lease. The terms of
the immediately preceding sentence shall survive the Closing and not be merged
therein.

 

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6.3Real Estate and Personal Property Taxes.

 

6.3.1           Proration of Ad Valorem Taxes. Buyer and Seller shall prorate ad
valorem real estate and personal property taxes for the Property that are
actually payable for the Closing Tax Year, based on the maximum discount
available for early payment, and all such taxes payable for prior years shall be
paid by Seller. There shall be no proration of ad valorem real estate or
personal property taxes other than as set forth hereinabove and, as between
Buyer and Seller, Buyer agrees that it shall be solely responsible for all such
ad valorem real estate and personal property taxes due and payable after the
Closing. The proration of the ad valorem real estate and personal property taxes
actually due and payable during the Closing Tax Year shall be calculated as
follows:

 

(a)          Seller shall be responsible for that portion of such taxes equal to
(i) the total such taxes due and payable during the Closing Tax Year, multiplied
by (ii) a fraction, the numerator of which shall be the number of days in the
Closing Tax Year prior to the Closing Date, and the denominator of which shall
be 365; and

 

(b)          Buyer shall be responsible for that portion of such taxes equal to
(i) the total such taxes due and payable during the Closing Tax Year, multiplied
by (ii) a fraction, the numerator of which shall be the number of days in the
Closing Tax Year subsequent to and including the Closing Date, and the
denominator of which shall be 365.

 

6.3.2           Insufficient Information. If, at Closing, the real estate and/or
personal property tax rate and assessments have not been set for the taxes due
and payable during the Closing Tax Year, then the proration of such taxes shall
be based upon the rate and assessments for the preceding Tax Year, and such
proration shall be adjusted between Seller and Buyer after Closing upon
presentation of written evidence that the actual taxes due and payable during
the Closing Tax Year differ from the amounts used at Closing and in accordance
with the provisions of Section 6.8.

 

6.3.3           Special Assessments. Seller shall pay all installments of
special assessments due and payable prior to the Closing Date and Buyer shall
pay all installments of special assessments due and payable on and after the
Closing Date; provided, however, that Seller shall not be required by the
foregoing to pay any installments of special assessments which relate to
projects that have not been completed in whole or in part as of the Closing
Date.

 

6.3.4           Reassessments. In the event the Property has been assessed for
property tax purposes at such rates as would result in reassessment (i.e.,
“escape assessment” or “roll-back taxes”) based upon the change in land usage or
ownership of the Property on or after the Closing Date, Buyer hereby agrees to
pay all such taxes and to indemnify and save Seller harmless from and against
all Liabilities for such taxes. Such indemnity shall survive the Closing and not
be merged therein.

 

- 16 -

 

 

6.4           Other Property Operating Expenses. Operating expenses for the
Property shall be prorated as of 12:01 a.m. on the Closing Date. Seller shall
pay all utility charges and other operating expenses attributable to the
Property to, but not including the Closing Date (except for those utility
charges and operating expenses payable by tenants in accordance with the Leases)
and Buyer shall pay all utility charges and other operating expenses
attributable to the Property on or after the Closing Date. To the extent that
the amount of actual consumption of any utility services is not determined prior
to the Closing Date, a proration shall be made at Closing based on the last
available reading and post-closing adjustments between Buyer and Seller shall be
made within twenty (20) days of the date that actual consumption for such
pre-closing period is determined, which obligation shall survive the Closing and
not be merged therein. Seller shall not assign to Buyer any deposits which
Seller has with any of the utility services or companies servicing the Property.
Buyer shall arrange with such services and companies to have accounts opened in
Buyer’s name beginning at 12:01 a.m. on the Closing Date. Any accrued but unpaid
amounts of sick leave, vacation days or paid time off attributable to Manager’s
employees as of Closing (“PTO Time”) as set forth in a schedule reasonably
approved by Seller and Buyer shall not be paid out by Seller at Closing;
instead, Buyer shall assume all obligations for such PTO Time following Closing,
and Buyer shall receive a credit against the Purchase Price for all such PTO
Time assumed by Buyer.

 

6.5           Closing Costs. Buyer shall pay the costs and expenses associated
with the following: (a) all costs of Buyer’s Due Diligence, including fees due
its consultants and attorneys, (b) all lenders’ fees and other costs of any kind
related to any financing to be obtained by Buyer, (c)  one-half of all escrow or
closing charges, (d) all premiums and charges of the Title Company for all
Owner’s Title Policies and any and all endorsements Buyer elects to have
included in such Owner’s Title Policies, (e)  all recording and filing charges
in connection with the instruments by which Seller conveys title to the
Property, and (f) the cost of all surveys. Seller shall pay the following costs
and expenses associated with the Transaction: (i) all fees due its attorneys,
(ii) all costs incurred in connection with causing the Title Company to Remove
any Required Removal Exceptions or to Remove any other Title Objections to the
extent Seller specifically agrees in writing, at or prior to Closing, to cause
Removal of such matter, it being understood for purposes of this sentence that
nothing in this Agreement or any prior understanding or agreement of the parties
shall be construed to obligate Seller to so Remove or agree to Remove any such
matter, (iii) one-half of all escrow or closing charges, and (iv)  all transfer
taxes, sales taxes, documentary stamp taxes and similar charges, if any,
applicable to the transfer of the Property to Buyer. The obligations of the
parties under this Section 6.5 shall survive the Closing (and not be merged
therein) or any earlier termination of this Agreement.

 

6.6           Cash Security Deposits. At Closing, Seller shall give Buyer a
credit against the Purchase Price in the aggregate amount of any cash security
deposits then held by Seller under the Leases, except that non-refundable
deposits shall be prorated by Seller and Buyer as rent paid over the term of the
applicable Lease.

 

6.7           Apportionment Credit. In the event the apportionments to be made
at the Closing result in a credit balance (a) to Buyer, such sum shall be paid
at the Closing by giving Buyer a credit against the Purchase Price in the amount
of such credit balance, or (b) to Seller, Buyer shall pay the amount thereof to
Seller at the Closing by wire transfer of immediately available funds to the
account or accounts to be designated by Seller for the payment of the Purchase
Price.

 

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6.8           Delayed Adjustment; Delivery of Operating and Other Statements. If
at any time following the Closing Date, the amount of an item prorated or
credited at Closing pursuant to this Article 6 shall prove to be incorrect
(whether as a result of an error in calculation or a lack of complete and
accurate information as of the Closing), the party in whose favor the error was
made shall promptly pay to the other party the sum necessary to correct such
error upon receipt of proof of such error, provided that such proof is delivered
to the party from whom payment is requested on or before ninety (90) days after
Closing (such period being referred to herein as the “Post Closing Adjustment
Period”). In order to enable Seller to determine whether any such delayed
adjustment is necessary, Buyer shall provide to Seller current operating and
financial statements for the Property no later than the date one (1) month prior
to the expiration of the Post-Closing Adjustment Period. The provisions of this
Section 6.8 shall survive the Closing and not be merged therein.

 

ARTICLE 7 - CLOSING

 

Buyer and Seller hereby agree that the Transaction shall be consummated as
follows:

 

7.1           Closing Date. Closing shall occur on the Closing Date, or such
earlier date as may be agreed to by both parties. The parties shall conduct an
escrow-style closing through the Title Company (or such other party selected by
Buyer and Seller) so that it will not be necessary for any party to attend the
Closing (Buyer and Seller shall endeavor to have pre-Closings to finalize and
sign all documents not later than the day prior to Closing, and deliver such
items to the escrow agent).

 

7.2           Title Transfer and Payment of Purchase Price. Provided all
conditions precedent to Seller’s obligations hereunder have been satisfied,
Seller agrees to convey the Property to Buyer upon confirmation of receipt of
the Purchase Price by the Escrow Agent as set forth below. Provided all
conditions precedent to Buyer’s obligations hereunder have been satisfied, Buyer
agrees to pay the amount specified in Article 3 by timely delivering the same to
the Escrow Agent no later than 2:00 p.m. Eastern Time on the Closing Date and
requesting the Escrow Agent to deposit the same in Seller’s designated account
by 3:00 p.m. Eastern Time on the Closing Date. In addition, for each full or
partial day after 2:00 p.m. Eastern Time on the Closing Date that Buyer has not
delivered the payment specified in Article 3 to the Escrow Agent, Buyer shall
pay to Seller at Closing (and as a condition thereto) the greater of (a) an
amount equal to one (1) day’s interest on the unpaid funds at the rate per annum
equal to the “prime rate” as such rate is reported in the “Money Rates” section
of The Wall Street Journal, as published and distributed in New York, New York,
in effect from time to time, and (b) an amount equal to the per diem proration
for one (1) day. Notwithstanding the foregoing; provided all conditions
precedent to both Buyer and Seller’s obligations hereunder have been satisfied
by no later than 12:00 noon on the Closing Date and subject to any provisions
regarding extension of the Closing Date herein, Seller shall have the right to
terminate this Agreement at any time if such payment is not received in Seller’s
designated account by 5:00 p.m. Eastern Time on the Closing Date.

 

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7.3           Seller’s Closing Deliveries. At the Closing, Seller shall deliver
or cause to be delivered the following with respect to each Facility:

 

(a)          Deed. A deed in the form of Exhibit D attached hereto and
incorporated herein by this reference (“Deed”) executed and acknowledged by
Seller.

 

(b)          Bill of Sale. A bill of sale in the form of Exhibit E attached
hereto and incorporated herein by this reference (“Bill of Sale”) executed by
Seller.

 

(c)          Assignment of Tenant Leases. An assignment and assumption of tenant
leases, in the form of Exhibit F attached hereto and incorporated herein by this
reference (“Assignment of Leases”) executed by Seller.

 

(d)          Assignment of Intangible Property. An assignment and assumption of
the Contracts and the Other Property Rights (to the extent the same are not
transferred by the Deed, Bill of Sale or Assignment of Leases) in the form of
Exhibit G attached hereto and incorporated herein by this reference (“Assignment
of Intangible Property”) executed by Seller.

 

(e)          Notice to Tenants. A single form letter in the form of Exhibit H
attached hereto and incorporated herein by this reference, executed by Seller,
duplicate copies of which shall be sent by Buyer after Closing to each tenant
under the Leases.

 

(f)          Non-Foreign Status Affidavit. A non-foreign status affidavit in the
form of Exhibit I attached hereto and incorporated herein by this reference, as
required by Section 1445 of the Internal Revenue Code, executed by Seller.

 

(g)          Evidence of Authority. A certificate of an officer of Seller
establishing to the reasonable satisfaction of the Title Company the authority
of Seller to consummate the Transaction.

 

(h)          Closing Statement. A Closing Statement in form reasonably agreed
upon by the parties (the “Closing Statement”).

 

(i)          Title Affidavit. A Seller’s Title Affidavit in the form of
Exhibit J attached hereto and incorporated herein by this reference.

 

(j)          Other Documents. Such other documents as may be reasonably required
by the Title Company or as may be agreed upon by Seller and Buyer to consummate
the Transaction.

 

(k)          Tax Returns. If applicable, duly completed and signed real estate
transfer tax or sales tax returns.

 

(l)          Keys and Original Documents. Keys to all locks on the Real Property
in Seller’s or Seller’s building manager’s possession and originals or, if
originals are not available, copies, of all of the Property Documents, to the
extent not previously delivered to Buyer.

 

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The items to be delivered by Seller in accordance with the terms of this
Section 7.3 shall be delivered to Escrow Agent no later than 5:00 p.m. Eastern
Time on the last Business Day prior to the Closing Date, except that the items
in the paragraph entitled “Keys and Original Documents” shall be delivered by
Seller outside of escrow and shall be deemed delivered if the same are located
at the Property on the Closing Date.

 

7.4           Buyer Closing Deliveries. At the Closing, Buyer shall deliver or
cause to be delivered the following with respect to each Facility:

 

(a)          Purchase Price. The Purchase Price, as adjusted for apportionments
and other adjustments required under this Agreement, plus any other amounts
required to be paid by Buyer at Closing.

 

(b)          Assignment of Leases. The Assignment of Leases executed and
acknowledged by Buyer.

 

(c)          Assignment of Intangible Property. The Assignment of Intangible
Property executed and acknowledged by Buyer.

 

(d)          Buyer’s As-Is Certificate. The certificate of Buyer required under
Article 5 hereof.

 

 (e)          Evidence of Authority. Documentation to establish to Seller’s
reasonable satisfaction the due authorization of Buyer’s acquisition of the
Property and Buyer’s execution of this Agreement and the documents required to
be delivered by Buyer pursuant to this Agreement and the consummation of the
Transaction.

 

(f)          Closing Statement. The Closing Statement.

 

(g)          Other Documents. Such other documents as may be reasonably required
by the Title Company or may be agreed upon by Seller and Buyer to consummate the
Transaction.

 

(h)          Tax Returns. If applicable, duly completed and signed real estate
transfer tax or sales tax returns.

 

The Purchase Price shall be paid in accordance with the terms of Section 7.2
hereof and the items to be delivered by Buyer in accordance with the terms of
Subsections (b) and following of this Section 7.4 shall be delivered to Escrow
Agent no later than 5:00 p.m. Eastern Time on the last Business Day prior to the
Closing Date.

 

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7.5           Termination Following Outside Closing Date. If Closing has not
occurred by the Outside Closing Date as a result of a failure of a condition to
closing set forth in Article 8 below, either Buyer or Seller may terminate this
Agreement immediately upon written notice to the other so long as the failure of
such condition to closing is not caused by a breach of this Agreement of the
terminating party. Following such termination, any Deposit shall be returned to
Buyer and, thereafter, the parties shall have no further rights or obligations
hereunder except for obligations which expressly survive the termination of this
Agreement. In the event a condition to closing has not occurred as a result of a
breach of this Agreement, then the parties shall have the rights and remedies
set forth in Article 11 below.

 

ARTICLE 8 - CONDITIONS TO CLOSING

 

8.1           Conditions to Seller’s Obligations. Seller’s obligation to close
the Transaction is conditioned on all of the following, any or all of which may
be waived by Seller by an express written waiver, at its sole option:

 

(a)          Representations True. All representations and warranties made by
Buyer in this Agreement shall be true and correct in all material respects on
and as of the Closing Date, as if made on and as of such date except to the
extent they expressly relate to an earlier date;

 

(b)          Buyer’s Financial Condition. No petition has been filed by or
against Buyer under the Federal Bankruptcy Code or any similar state or federal
Law, whether now or hereafter existing; and

 

(c)          Buyer’s Deliveries Complete. Buyer shall have delivered the funds
required hereunder and all of the documents to be executed by Buyer as set forth
in Section 7.4 and shall have performed all other covenants, undertakings and
obligations, and complied with all conditions required by this Agreement, to be
performed or complied with by Buyer at or prior to the Closing.

 

8.2           Conditions to Buyer’s Obligations. Buyer’s obligation to close the
Transaction is conditioned on all of the following, any or all of which may be
expressly waived by Buyer in writing, at its sole option:

 

(a)          Representations True. Subject to the provisions of Section 9.3, all
representations and warranties made by Seller in this Agreement, as the same may
be amended as provided in Section 9.3, shall be true and correct in all material
respects on and as of the Closing Date, as if made on and as of such date except
to the extent that they expressly relate to an earlier date;

 

(b)          Title Conditions Satisfied. At the time of the Closing, title to
the Property shall be as provided in Article 4 of this Agreement; and

 

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(c)          Seller’s Deliveries Complete. Seller shall have delivered all of
the documents and other items required pursuant to Section 7.3 and shall have
performed all other covenants, undertakings and obligations, and complied with
all conditions required by this Agreement, to be performed or complied with by
Seller at or prior to the Closing.

 

(d)          Lender Requirements Fulfilled. All conditions imposed on Seller by
Existing Lender and reasonably approved by Seller during the Approval Period
relating to Buyer’s assumption of the Existing Property Debt at Closing shall
have been fulfilled and/or delivered by Seller, as applicable.

 

(e)          HSR Compliance. If Buyer determines in its reasonable discretion
that the pre-merger filing requirements of the Hart-Scott-Rodino Antitrust
Improvements Act of 1976, as amended (“HSR Act”) apply to the transactions
contemplated under this Agreement, then with respect to the requirements of the
HSR Act, any filings required shall have been made, any approvals required shall
have been obtained and/or any required waiting periods shall have elapsed. Buyer
shall be required to notify Seller in writing prior to the expiration of the Due
Diligence Period whether Buyer shall make any filings pursuant to the HSR Act;
otherwise, this condition precedent shall be deemed waived by Buyer.

 

8.3         Waiver of Failure of Conditions Precedent. At any time or times on
or before the date specified for the satisfaction of any condition, Seller or
Buyer may elect in writing to waive the benefit of any such condition set forth
in Section 8.1 or Section 8.2, respectively. By closing the Transaction, Seller
and Buyer shall be conclusively deemed to have waived the benefit of any
remaining unfulfilled conditions set forth in Section 8.1 and Section 8.2,
respectively. In the event any of the conditions set forth in Section 8.1 or
Section 8.2 are neither waived nor fulfilled, Seller or Buyer (as appropriate)
may exercise such rights and remedies, if any, that such party may have pursuant
to the terms of Article 11 hereof.

 

8.4         Approvals not a Condition to Buyer’s Performance. Subject to Buyer’s
right to terminate this Agreement prior to the expiration of the Due Diligence
Period in accordance with the terms of Article 5 hereof, Buyer acknowledges and
agrees that its obligation to perform under this Agreement is not contingent
upon Buyer’s ability to obtain any (a) governmental or quasi-governmental
approval of changes or modifications in use or zoning, or (b) modification of
any existing land use restriction, or (c) consents to assignments of any service
contracts, management agreements or other agreements (other than the Lender
Approval) which Buyer requests.

 

ARTICLE 9 - REPRESENTATIONS AND WARRANTIES

 

9.1         Buyer’s Representations. Buyer represents and warrants to, and
covenants with, Seller as follows:

 

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9.1.1           Buyer’s Authorization. Buyer (and as used in this Section 9.1.1,
the term Buyer includes any general partners or managing members of Buyer)
(a) is duly organized (or formed), validly existing and in good standing under
the Laws of the State of Delaware, (b) is authorized to consummate the
Transaction and fulfill all of its obligations hereunder and under all documents
contemplated hereunder to be executed by Buyer, and (c) has all necessary power
to execute and deliver this Agreement and all documents contemplated hereunder
to be executed by Buyer, and to perform all of its obligations hereunder and
thereunder. This Agreement and all documents contemplated hereunder to be
executed by Buyer, have been duly authorized by all requisite partnership,
corporate or other required action on the part of Buyer and are the valid and
legally binding obligation of Buyer, enforceable in accordance with their
respective terms. Neither the execution and delivery of this Agreement and all
documents contemplated hereunder to be executed by Buyer, nor the performance of
the obligations of Buyer hereunder or thereunder will result in the violation of
any Law or any provision of the organizational documents of Buyer or will
conflict with any order or decree of any court or governmental instrumentality
of any nature by which Buyer is bound.

 

9.1.2           Buyer’s Financial Condition. No petition has been filed by or
against Buyer under the Federal Bankruptcy Code or any similar state or federal
Law.

 

9.1.3           Plan Assets; ERISA. Buyer is not an “employee benefit plan”
subject to the provisions of Title I of ERISA or a “plan” subject to Section
4975 of the Code and Buyer is not using “plan assets” of any such employee
benefit plan or plan to acquire the Property

 

9.2         Seller’s Representations. Seller represents and warrants to Buyer as
follows (but Buyer acknowledges that each of the representations and warranties
set forth throughout all of Section 9.2 are made solely by the entity that owns
each Facility, respectively, and each party, as Seller, shall be liable and
responsible only for such representations and warranties to the extent
applicable to the Facility owned by that entity and no entity shall be liable or
responsible for any misrepresentation or false warranty made by another entity
with respect to any other Facility):

 

9.2.1           Seller’s Authorization. Seller (and as used in this
Section 9.2.1, the term Seller includes any general partners or managing members
of Seller) (a) is duly organized (or formed), validly existing and in good
standing under the Laws of the State in which its Facility is located and, as
and to the extent required by applicable Laws, under the Laws of the State in
which the Facilities are located, (b) subject to obtaining the approvals
described in Subsection 8.1(a), is authorized to consummate the Transaction and
fulfill all of its obligations hereunder and under all documents contemplated
hereunder to be executed by Seller, and (c) has all necessary power to execute
and deliver this Agreement and all documents contemplated hereunder to be
executed by Seller, and to perform all of its obligations hereunder and
thereunder. Subject to obtaining the approvals described in Subsection 8.1(a),
this Agreement and all documents contemplated hereunder to be executed by
Seller, have been duly authorized by all requisite partnership, corporate or
other required action on the part of Seller and are the valid and legally
binding obligation of Seller, enforceable in accordance with their respective
terms. Neither the execution and delivery of this Agreement and all documents
contemplated hereunder to be executed by Seller, nor the performance of the
obligations of Seller hereunder or thereunder will result in the violation of
any Law or any provision of the organizational documents of Seller or will
conflict with any order or decree of any court or governmental instrumentality
of any nature by which Seller is bound.

 

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9.2.2       Other Seller’s Representations.

 

(a)          Except as listed in Exhibit K attached hereto and incorporated
herein by this reference, there are no outstanding judgments or current, pending
or, to Seller’s Knowledge, pending litigation against Seller or with respect to
the Property (including, but not limited to, condemnation proceedings against
the Property) or, to Seller’s Knowledge, the existing manager of any Facility
(each a “Manager”) with respect to the applicable Property.

 

(b)          The Contracts listed in Exhibit B attached hereto constitute all of
the contracts and agreements to which Seller is a party and which relate to or
affect the Property. As of the date of this Agreement, except for (i) the
Contracts listed in Exhibit B attached hereto, (ii) the Leases, and (iii) the
Permitted Exceptions, Seller has not entered into any contracts, subcontracts or
agreements affecting the Property that will be binding upon Buyer after the
Closing.

 

(c)          Except as listed in Exhibit K attached hereto, Seller has not
received any written notice of default from any parties to the Contracts that
has not been cured by Seller on or before the date hereof, and to Seller’s
Knowledge no such default currently exists.

 

(d)          As of the date of this Agreement, the only tenants under signed
leases at the Property are the tenants listed in Exhibit L attached hereto and
incorporated herein by this reference; provided, however, that the foregoing is
not intended (and shall not be construed) as a representation by Seller of the
parties that are in actual possession of any portion of the Property since there
may be subtenants, licensees or assignees that are in possession of portions of
the Property of which Seller may not be aware.

 

(e)          Except as listed in Exhibit K attached hereto, as of the date of
this Agreement and except for violations that have been cured, Seller has not
received any written notice from any governmental authority with respect to the
violation of any law, statute, or ordinance applicable to the Property, and to
Seller’s Knowledge no such violation or violations currently exist.

 

(f)          As of the date of this Agreement, there are no currently effective
leasing commission agreements with respect to the Property.

 

(g)          As of the date of this Agreement, except as set forth on Exhibit K
attached hereto and except for defaults cured on or before the date hereof,
neither Seller nor, to Seller’s Knowledge, any Manager has either (i) received
any written notice from any tenant of the Property asserting or alleging that
Seller is in default under such tenant’s Lease, or (ii) sent to any tenant of
the Property any written notice alleging or asserting that such tenant is in
default under such tenant’s Lease.

 

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(h)          As of the date of this Agreement, the rent rolls attached as
Exhibit L and incorporated herein by this reference (each, a “Rent Roll”), are
each true, correct and complete in all material respects,; provided, however,
that for the purposes hereof, each Rent Roll shall only be deemed to be
materially inaccurate or incorrect if it is inaccurate or incorrect by more than
two percent (2%) of the gross monthly income for the applicable Facility as set
forth therein.

 

(i)          No Rents or Leases have been assigned, transferred or hypothecated
by Seller, except by virtue of mortgage loan instruments which shall be paid in
full by Seller at or prior to Closing, and except as set forth in Exhibit B
attached hereto with respect to leasing commission agreements with respect to
the Property.

 

(j)          The Personal Property to be transferred to Buyer is free and clear
of liens, security interests and other encumbrances arising by, through or under
Seller (other than equipment and/or vehicle leases affecting such Personal
Property, as disclosed in the list of Contracts) and constitutes all of the
material personal property used in connection with the operation of the
Property.

 

(k)          Except as disclosed in the Title Commitments, as of the date of
this Agreement and except as listed in Exhibit K attached hereto, as of the date
of this Agreement, Seller has not received any written notice from any
governmental agency that any special assessments are pending, noted or levied
against the Property.

 

(l)          Except as disclosed in the Title Commitments, as of the date of
this Agreement, Seller has not received any written notice of any proposed
reassessments of the Property from the local taxing agencies that would, in the
reasonable judgment of Seller, increase real property taxes or assessments
against the Property.

 

(m)          No petition has been filed by Seller, nor, to Seller’s Knowledge,
filed or threatened to be filed by any third party, nor has Seller received
written notice of any petition filed against Seller, under the Federal
Bankruptcy Code or any similar state or federal Law.

 

(n)          As of the date of this Agreement, except as listed in Exhibit K
attached hereto and except for violations that have been cured, Seller has not
received any written notice from any insurance company that carries any of
Seller’s insurance with respect to the Property that any portion of the Property
violates any building, fire, or health code, statute, ordinance, rule or
regulation applicable to the Property.

 

- 25 -

 

 

(o)          There are no outstanding rights of first refusal, options or other
agreements binding upon Seller whereby any individual or entity has the right to
purchase all or any part of the Property.

 

(p)          Exhibit M attached hereto is a true and complete list of all
Licenses held by the Seller, and/or to Seller’s Knowledge any Manager, with
respect to the operation of each Property as an assisted living facility. As of
the date of this Agreement and as updated as of Closing, and except as set forth
on Exhibit K and otherwise except for violations that have been cured, Seller
has not, and to Seller’s Knowledge no Manager has, received written notice that
any applications, complaints or proceedings are pending, contemplated or, to
Seller’s knowledge, threatened against Seller, the Licenses, or the Facility
which may result in (i) the revocation, modification, non-renewal or suspense of
any such Licenses, (ii) the denial of any pending application with respect to
such Licenses, (iii) the issuance of any cease and desist order against the
Facility, or (iv) the imposition of any fines, forfeitures or other
administrative action with respect to the Facility or its operation as an
assisted living facility.

 

(q)          Except with respect to the Properties and applicable programs set
forth on Exhibit N, at no time during Seller’s ownership of the Property has the
Property, directly or indirectly, been a provider in or reimbursed under any
federally funded healthcare program or expense reimbursement program, such as
Medicare or Medicaid. With respect to those reimbursement programs detailed in
Exhibit N (“Governmental Payor Programs”),Seller has not received written notice
of pending, threatened or possible investigation by, or loss of participation
in, or any other claims with respect to any Governmental Payor Programs, and, to
Seller’s Knowledge, there is no basis for any such notice.

 

(r)          Seller is not a “foreign person” within the meaning of Section 1445
of the Code and the Regulations issued thereunder.

 

(s)          During Seller’s ownership of the Property, Seller has not leased
nor reserved for lease any unit at the property as an affordable housing unit or
for low or moderate-income residents. To Seller’s Knowledge, the Property is not
required to lease or reserve any unit or bedroom as an affordable housing unit
or bedroom or for low- or moderate-income residents pursuant to a presently
existing agreement or applicable Law.

 

(t)          Seller has delivered to Buyer the financial statements (including
balance sheet and income statement) for Seller and the Property (the "Financial
Statements") for the current calendar year through April 30, 2013. To Seller’s
Knowledge, the Financial Statements are materially accurate and complete.

 

(u)          Except as listed in Exhibit K attached hereto, as of the date of
this Agreement and except for violations that have been cured, Seller has not
received any written notice of any defaults from Existing Lender with respect to
the Existing Property Debt.

 

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9.3         General Provisions.

 

9.3.1           No Representation As to Leases. Seller does not represent or
warrant that any particular Lease or Leases will be in force or effect on the
Closing Date or that the tenants will have performed their obligations
thereunder.

 

9.3.2           Seller’s Warranties Deemed Modified. To the extent that Buyer
knows or is deemed to know prior to the expiration of the Due Diligence Period
that Seller’s Warranties are inaccurate, untrue or incorrect in any way, such
Seller’s Warranties shall be deemed modified to reflect Buyer’s knowledge or
deemed knowledge, as the case may be.

 

9.3.3           Notice of Breach; Seller’s Right to Cure. If after the
expiration of the Due Diligence Period but prior to the Closing, Buyer or any
Buyer’s Representative obtains actual knowledge that any of Seller’s Warranties
are untrue, inaccurate or incorrect in any material respect, Buyer shall give
Seller written notice thereof within five (5) Business Days of obtaining such
knowledge (but, in any event, prior to the Closing). If at or prior to the
Closing, Seller obtains actual knowledge that any of Seller’s Warranties are
untrue, inaccurate or incorrect in any material respect, Seller shall give Buyer
written notice thereof within five (5) Business Days of obtaining such knowledge
(but, in any event, prior to the Closing). In either such event, Seller shall
have the right to cure such misrepresentation or breach and shall be entitled to
a reasonable adjournment of the Closing (not to exceed thirty (30) days) for the
purpose of such cure. If Seller is unable to so cure any misrepresentation or
breach, then Buyer, as its sole remedy for any and all such materially untrue,
inaccurate or incorrect material representations or warranties, shall elect
either (a) to waive such misrepresentations or breaches of representations and
warranties and consummate the Transaction without any reduction of or credit
against the Purchase Price, or (b) to terminate this Agreement by written notice
given to Seller on the Closing Date, in which event this Agreement shall be
terminated, any Deposit shall be returned to Buyer and, thereafter, neither
party shall have any further rights or obligations hereunder except as provided
in any section hereof that by its terms expressly provides that it survives any
termination of this Agreement. If any of Seller’s Warranties are untrue,
inaccurate or incorrect but are not, in the aggregate, untrue, inaccurate or
incorrect in any material respect, Buyer shall be deemed to waive such
misrepresentation or breach of warranty, and Buyer shall be required to
consummate the Transaction without any reduction of or credit against the
Purchase Price. The untruth, inaccuracy or incorrectness of Seller’s Warranties
shall be deemed material only if Buyer’s aggregate damages resulting from the
untruth, inaccuracy or incorrectness of Seller’s Warranties (in the aggregate
with respect to all Facilities) are reasonably estimated to exceed Fifty
Thousand and No/100ths Dollars ($50,000.00).

 

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9.3.4           Survival; Limitation on Seller’s Liability. Seller’s Warranties
shall survive the Closing and not be merged therein for a period of twelve (12)
months and Seller shall only be liable to Buyer hereunder for a breach of
Seller’s Warranties made herein or in any of the documents executed by Seller at
the Closing with respect to which a claim is made by Buyer against Seller on or
before the date which is twelve (12) months after the date of the Closing.
Anything in this Agreement to the contrary notwithstanding, the maximum
aggregate liability of Seller for breaches of Seller’s Warranties shall be
limited as set forth in Section 15.14 hereof. Notwithstanding the foregoing,
however, if the Closing occurs, Buyer hereby expressly waives, relinquishes and
releases any right or remedy available to it at law, in equity, under this
Agreement or otherwise to make a claim against Seller for damages that Buyer may
incur, or to rescind this Agreement and the Transaction, as the result of any of
Seller’s Warranties being untrue, inaccurate or incorrect if (a) Buyer knew or
is deemed to know that such representation or warranty was untrue, inaccurate or
incorrect at the time of the Closing, or (b) Buyer’s damages as a result of such
representations or warranties being untrue, inaccurate or incorrect are
reasonably estimated to be less than Fifty Thousand and No/100ths Dollars
($50,000.00) (in the aggregate with respect to all Facilities).

 

ARTICLE 10 - COVENANTS

 

10.1       Buyer’s Covenants. Buyer hereby covenants as follows:

 

10.1.1           Confidentiality. Buyer acknowledges that any information
heretofore or hereafter furnished to Buyer with respect to the Property has been
and will be so furnished on the condition that Buyer maintain the
confidentiality thereof. Accordingly, Buyer shall hold, and shall cause Buyer’s
Representatives to hold, in strict confidence, and Buyer shall not disclose, and
shall prohibit Buyer’s Representatives from disclosing, to any other person
without the prior written consent of Seller until the Closing shall have been
consummated, (a) the terms of the Agreement, (b) any of the information in
respect of the Property delivered to or for the benefit of Buyer whether by any
Buyer’s Representatives or by Seller or any of the Seller Parties, including,
but not limited to, any information heretofore or hereafter obtained by Buyer or
any Buyer’s Representatives in connection with its Due Diligence, and (c) the
identity of Seller, and, if applicable, the identity of any direct or indirect
owner of any beneficial interest in Seller. In addition, Buyer hereby agrees
that, after Closing, it shall continue to hold, and shall cause Buyer’s
Representatives to hold, the terms of this Agreement and the identity of Seller,
and, if applicable, the identity of any direct or indirect owner of any
beneficial interest in Seller in strict confidence, and Buyer shall not
disclose, and shall prohibit Buyer’s Representatives from disclosing, such
information to any other person without the prior written consent of Seller. In
the event the Closing does not occur or this Agreement is terminated, Buyer
shall promptly return to Seller all copies of documents containing any of such
information without retaining any copy thereof or extract therefrom.
Notwithstanding anything to the contrary hereinabove set forth, Buyer may
disclose such information (i) on a need-to-know basis to its employees, members
of professional firms serving it or potential lenders, (ii) as any governmental
agency may require in order to comply with applicable Laws (including without
limitation as may be necessary to apply for the Licenses needed for Buyer’s
operation (or its designee’s operation) of the Facilities and as may be required
by applicable Securities and Exchange Commission rules applicable to Buyer or
its affiliates), or (iii) to the extent that such information is a matter of
public record. The provisions of this Subsection 10.1.1 shall survive any
termination of this Agreement for a period of two (2) years.

 

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10.1.2           Buyer’s Indemnity. Buyer hereby agrees to indemnify, defend,
and hold Seller and each of the other Seller Parties free and harmless from and
against any and all Liabilities (including reasonable attorneys’ fees, expenses
and disbursements) arising out of or resulting from (a) the breach of the terms
of Subsection 10.1.1 or (b) the entry on the Real Property and/or the conduct of
any Due Diligence by Buyer or any of Buyer’s Representatives at any time prior
to the Closing; provided, however, that Buyer’s obligations under this
clause (b) shall not apply to the mere discovery of an pre-existing
environmental or physical condition at the Property. The foregoing indemnity
shall survive the Closing (and not be merged therein) or any earlier termination
of this Agreement.

 

10.2       Seller’s Covenants. Seller hereby covenants as follows:

 

10.2.1     Service Contracts.

 

(a)          Without Buyer’s prior consent, which consent shall not be
unreasonably withheld or delayed, between the date hereof and the Closing Date
Seller shall not extend, renew, replace or modify any Contract or enter into any
new service contract or agreement unless such Contract, service contract or
agreement (as so extended, renewed, replaced or modified) can be terminated by
the owner of the Property without penalty on not more than thirty (30) days’
notice. Seller shall provide Buyer not less than three (3) Business Days’ prior
written notice to provide its consent to any such contract, extension, renewal,
replacement or modification. If Buyer fails to object in writing to any such
proposed action within three (3) Business Days after receipt of the
aforementioned notice, Buyer shall be deemed to have approved the proposed
action. Buyer’s consent shall not be unreasonably withheld or delayed with
respect to any such transaction that is proposed prior to the end of the Due
Diligence Period, but thereafter, Buyer, in its sole and absolute discretion,
shall be entitled to grant or withhold its consent with respect to any such
transaction that is proposed between the end of the Due Diligence Period and the
Closing.

 

(b)          On or before the Closing, Seller shall terminate any management
agreements currently in effect with respect to the Property at the sole cost and
expense of Seller.

 

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10.2.2           Maintenance of Property. Except to the extent Seller is
relieved of such obligations by Article 12 hereof, between the date hereof and
the Closing Date Seller shall maintain and keep the Property in a manner
consistent with Seller’s past practices with respect to the Property; provided,
however, that, subject to Buyer’s right to terminate this Agreement prior to the
expiration of the Due Diligence Period in accordance with the terms of Article 5
hereof, Buyer hereby agrees that, except for breaches of, and except as
otherwise set forth in, this Section 10.2.2, Buyer shall accept the Property
subject to, and Seller shall have no obligation to cure, (a) any violations of
Laws, or (b) any physical conditions that would give rise to violations of Laws,
whether the same now exist or arise prior to Closing. Between the date hereof
and the Closing Date, Seller will advise Buyer of any written notice Seller
receives after the date hereof from any governmental authority of the violation
of any Laws regulating the condition or use of the Property. Between the date
hereof and the Closing Date, Seller will advise Buyer of any written notice
Seller receives after the date hereof from any governmental authority of the
violation of any Laws regulating the condition or use of the Property. In the
event that, following the date hereof, Seller delivers Buyer a written notice of
a violation of Laws regarding the condition or use of the Property, and the
reasonably estimated cost to correct such violation is less than $50,000.00,
then Seller shall be responsible to either (i) correct such violation prior to
Closing, or (ii) if such violations are not corrected on or prior to Closing,
credit to Buyer the reasonable cost to complete such violation, not to exceed
$50,000.00. In the event that Seller delivers Buyer a written notice of a
violation of Laws regarding the condition of the Property, and the reasonably
estimated cost to correct such violation would exceed Fifty Thousand and
No/100ths Dollars ($50,000.00), Seller shall have the right, but not the
obligation, to either (A) cure such items, or (B) credit the Buyer the
reasonable cost to complete such violation. In the event that Seller either
elects not to cure such violation or credit Buyer the reasonable cost of such
violation, Buyer shall have the right to terminate this Agreement by providing
written notice to Seller prior to the earlier of (a) five (5) business days of
receipt of such notice of violation, or (b) the Closing Date, in which event
this Agreement shall be terminated, any Deposit shall be returned to Buyer and
thereafter neither party shall have any further rights or obligations hereunder
except as provided in any section hereof that by its terms expressly provides
that it survives any termination of this Agreement.

 

10.2.3           Post Closing Records. Upon Buyer's request, for a period of one
(1) year after Closing, Seller shall make the operating statements and any and
all books, records, correspondence, financial data, Leases, delinquency reports
and all other documents and matters maintained by Seller or its agents and
relating to receipts and expenditures reasonably necessary to complete an audit
pertaining to the Property for the three (3) most recent full calendar years and
the interim period of the current calendar year (collectively, the “Records”)
available to Buyer for inspection, copying and audit by Buyer's designated
accountants, and at Buyer's expense. Seller shall provide Buyer, but without
expense to Seller, with copies of, or access to, such factual and financial
information as may be reasonably requested by Buyer or its designated
accountants, and in the possession or control of Seller, to enable Buyer to file
any filings required by the Securities and Exchange Commission (the “SEC”) in
connection with the purchase of the Property. Seller understands and
acknowledges that Buyer is required to file audited financial statements related
to the Property with the SEC within seventy-one (71) days of the Closing Date
and agrees to provide any Records on a timely basis to facilitate Buyer’s timely
submission of such audited financial statements.

 

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 10.2.4           Survival. The provisions of this Section 10.2 shall survive
the Closing (and not be merged therein) of this Agreement.

 

10.3       Mutual Covenants.

 

10.3.1           Publicity. Seller and Buyer each hereby covenant and agree that
(a) prior to the Closing neither Seller nor Buyer shall issue any Release (as
hereinafter defined) with respect to the Transaction without the prior consent
of the other, except to the extent required by applicable Law, and (b) after the
Closing, any Release issued by either Seller or Buyer shall be subject to the
review and approval of both parties (which approval shall not be unreasonably
withheld or delayed), except to the extent required by applicable Law. If either
Seller or Buyer is required by applicable Law to issue a Release, such party
shall, at least two (2) Business Days prior to the issuance of the same, deliver
a copy of the proposed Release to the other party for its review. As used
herein, the term “Release” shall mean any press release or public statement with
respect to the Transaction or this Agreement.

 

10.3.2           Brokers. Seller and Buyer expressly acknowledge that Seller’s
Broker has acted as the exclusive broker with respect to the Transaction and
with respect to this Agreement. Seller shall pay any brokerage commission due to
Seller’s Broker in accordance with the separate agreement between Seller and
Seller’s Broker. Seller agrees to hold Buyer harmless and indemnify Buyer from
and against any and all Liabilities (including reasonable attorneys’ fees,
expenses and disbursements) without regard to any limitation on the liability of
Seller set forth in this Agreement, suffered or incurred by Buyer as a result of
any claims by Seller’s Broker or any other party claiming to have represented
Seller as broker in connection with the Transaction. Buyer agrees to hold Seller
harmless and indemnify Seller from and against any and all Liabilities
(including reasonable attorneys’ fees, expenses and disbursements) suffered or
incurred by Seller as a result of any claims by any party claiming to have
represented Buyer as broker in connection with the Transaction other than
Seller’s Broker.

 

10.3.3           Tax Protests, Tax Refunds and Credits. Seller shall have the
right to continue and to control the progress of and to make all decisions with
respect to any contest of the real estate taxes and personal property taxes for
the Property due and payable during the Closing Tax Year and all prior Tax
Years. Buyer shall have the right to control the progress of and to make all
decisions with respect to any tax contest of the real estate taxes and personal
property taxes for the Property due and payable during all Tax Years subsequent
to the Closing Tax Year. All real estate and personal property tax refunds and
credits received after Closing with respect to the Property shall be applied in
the following order of priority: first, to pay the costs and expenses (including
reasonable attorneys’ fees, expenses and disbursements) incurred in connection
with obtaining such tax refund or credit; second, to pay any amounts due to any
past or present tenant of the Property as a result of such tax refund or credit
to the extent required pursuant to the terms of the Leases; and third,
apportioned between Buyer and Seller as follows:

 

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(a)          with respect to any refunds or credits attributable to real estate
and personal property taxes due and payable during the Closing Tax Year
(regardless of the year for which such taxes are assessed), such refunds and
credits shall be apportioned between Buyer and Seller in the manner provided in
Section 6.3;

 

(b)          with respect to any refunds or credits attributable to real estate
and personal property taxes due and payable during any period prior to the
Closing Tax Year (regardless of the year for which such taxes are assessed),
Seller shall be entitled to the entire refunds and credits; and

 

(c)          with respect to any refunds or credits attributable to real estate
and personal property taxes due and payable during any period after the Closing
Tax Year (regardless of the year for which such taxes are assessed), Buyer shall
be entitled to the entire refunds and credits.

 

10.3.4           Survival. The provisions of this Section 10.3 shall survive the
Closing (and not be merged therein) of this Agreement.

 

ARTICLE 11 - FAILURE OF CONDITIONS

 

11.1         To Seller’s Obligations. If, on or before the Closing Date,
(i) Buyer is in default of any of its obligations hereunder, or (ii) any of
Buyer’s material representations or warranties are untrue in any material
respect, or (iii) the Closing otherwise fails to occur by reason of Buyer’s
failure or refusal to perform its obligations hereunder in a prompt and timely
manner, and such circumstance in (i), (ii) or (iii) continues for five (5) days
after written notice from Seller to Buyer, which written notice shall detail
such default, untruth or failure, as applicable, then Seller shall have the
right, to elect, as its sole and exclusive remedy, to (a) terminate this
Agreement by written notice to Buyer; or (b) waive the condition and proceed to
close the Transaction. If this Agreement is so terminated, then Seller shall be
entitled to the Deposit as liquidated damages, and thereafter neither party to
this Agreement shall have any further rights or obligations hereunder other than
any arising under any section herein which expressly provides that it survives
the termination of this Agreement.

 

11.2         To Buyer’s Obligations. If, at the Closing, (i) Seller is in
default of any of its obligations hereunder, or (ii) any of Seller’s material
representations or warranties are untrue in any material respect, or (iii) the
Closing otherwise fails to occur by reason of Seller’s failure or refusal to
perform its obligations hereunder in a prompt and timely manner, and such
circumstance in (i), (ii) or (iii) continues for five (5) days after written
notice from Buyer to Seller, which written notice shall detail such default,
untruth or failure, as applicable, Buyer shall have the right, to elect, as its
sole and exclusive remedy, to choose one of the following remedies:
(a) terminate this Agreement by written notice to Seller, promptly after which
any Deposit shall be returned to Buyer and, thereafter, the parties shall have
no further rights or obligations hereunder except for obligations which
expressly survive the termination of this Agreement, and in which case Seller
will reimburse Buyer for its actual, out of pocket third party expenses incurred
in connection with entering into this Agreement and pursuing the Transaction,
and its due diligence investigation of the of the same, not to exceed Two
Hundred Thousand and No/100ths Dollars ($200,000.00), or (b) waive the condition
and proceed to close the Transaction, or (c) seek specific performance of this
Agreement by Seller. As a condition precedent to Buyer exercising any right it
may have to bring an action for specific performance hereunder, Buyer must
commence such an action within ninety (90) days after the occurrence of Seller’s
default. Buyer agrees that its failure to timely commence such an action for
specific performance within such ninety (90) day period shall be deemed a waiver
by it of its right to commence an action for specific performance as well as a
waiver by it of any right it may have to file or record a notice of lis pendens
or notice of pendency of action or similar notice against any portion of the
Property.

 

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ARTICLE 12 - CONDEMNATION/CASUALTY

 

12.1         Right to Terminate. If, after the date hereof, (a) any portion of
any Facility is taken by condemnation or eminent domain (or is the subject of a
pending taking which has not yet been consummated), or (b) any portion of any
Facility is damaged or destroyed by casualty (excluding routine wear and tear),
Seller shall notify Buyer in writing of such fact promptly after obtaining
knowledge thereof. If any Facility is the subject of a Major
Casualty/Condemnation that occurs after the date hereof, Buyer shall have the
right to terminate this Agreement by giving written notice to Seller no later
than ten (10) Business Days after the giving of Seller’s notice, and the Closing
Date shall be extended, if necessary, to provide sufficient time for Buyer to
make such election. The failure by Buyer to so elect in writing to terminate
this Agreement within such ten (10) Business Day period shall be deemed an
election not to terminate this Agreement. Buyer shall have no right to terminate
this Agreement as to only one Facility; the Agreement must either remain in
effect with respect to all Facilities or be terminated with respect to all
Facilities, even though the Major Casualty/Condemnation may have affected only
one Facility. If this Agreement is terminated pursuant to this Section 12.1, any
Deposit shall be returned to Buyer and, thereafter, this Agreement shall
terminate and neither party to this Agreement shall have any further rights or
obligations hereunder other than any arising under any section herein which
expressly provides that it shall survive the termination of this Agreement.

 

12.2         Allocation of Proceeds and Awards. If a condemnation or casualty
occurs after the date hereof and this Agreement is not terminated as permitted
pursuant to the terms of Section 12.1, then this Agreement shall remain in full
force and effect, Buyer shall acquire the Property (or the remainder thereof)
upon the terms and conditions set forth herein and at the Closing:

 

(a)          if the awards or proceeds, as the case may be, have been paid to
Seller prior to Closing, Buyer shall receive a credit at Closing equal to
(i) the amount of any such award or proceeds on account of such condemnation or
casualty, plus (ii) if a casualty has occurred and such casualty is an insured
casualty, an amount equal to Seller’s deductible with respect to such casualty,
less (iii) an amount equal to the Seller-Allocated Amounts; and

 

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(b)          to the extent that such award or proceeds have not been paid to
Seller prior to Closing, (i) if a casualty has occurred and such casualty is an
insured casualty, Buyer shall receive a credit at Closing equal to Seller’s
deductible with respect to such casualty, less an amount equal to the
Seller-Allocated Amounts, and (ii) Seller shall assign to Buyer at the Closing
(without recourse to Seller) the rights of Seller to, and Buyer shall be
entitled to receive and retain, such awards or proceeds; provided, however, that
within one (1) Business Day after receipt of such awards or proceeds, Buyer
shall pay to Seller an amount equal to the Seller-Allocated Amounts not
previously paid to Seller.

 

12.3         Insurance. Seller shall maintain the property insurance coverage
currently in effect for the Property, or comparable coverage, through the
Closing Date.

 

12.4         Waiver. The provisions of this Article 12 supersede the provisions
of any applicable Laws with respect to the subject matter of this Article 12.

 

ARTICLE 13 - ESCROW

 

The Deposit and any other sums (including, without limitation, any interest
earned thereon) which the parties agree shall be held in escrow (herein
collectively called the “Escrow Deposits”), shall be held by the Escrow Agent,
in trust, and disposed of only in accordance with the following provisions:

 

13.1         Deposit. The Escrow Agent shall invest the Escrow Deposits in
government insured interest-bearing instruments reasonably satisfactory to both
Buyer and Seller, shall not commingle the Escrow Deposits with any funds of the
Escrow Agent or others, and shall promptly provide Buyer and Seller with
confirmation of the investments made.

 

13.2         Delivery. If the Closing occurs, the Escrow Agent shall deliver the
Escrow Deposits to, or upon the instructions of, Seller on the Closing Date.

 

13.3         Failure of Closing. If for any reason the Closing does not occur,
the Escrow Agent shall deliver the Escrow Deposits to Seller or Buyer only upon
receipt of a written demand therefor from such party, subject to the following
provisions of this Section 13.3. If for any reason the Closing does not occur
and either party makes a written demand upon the Escrow Agent for payment of the
Escrow Deposits, the Escrow Agent shall give written notice to the other party
of such demand. If the Escrow Agent does not receive a written objection from
the other party to the proposed payment within ten (10) days after the giving of
such notice, the Escrow Agent is hereby authorized to make such payment. If the
Escrow Agent does receive such written objection within such period, the Escrow
Agent shall continue to hold such amount until otherwise directed by written
instructions signed by Seller and Buyer or a final judgment of a court.

 

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13.4         Stakeholder. The parties acknowledge that the Escrow Agent is
acting solely as a stakeholder at their request and for their convenience, that
the Escrow Agent shall not be deemed to be the agent of either of the parties,
and that the Escrow Agent shall not be liable to either of the parties for any
action or omission on its part taken or made in good faith, and not in disregard
of this Agreement, but shall be liable for its negligent acts and for any
Liabilities (including reasonable attorneys’ fees, expenses and disbursements)
incurred by Seller or Buyer resulting from the Escrow Agent’s mistake of law
respecting the Escrow Agent’s scope or nature of its duties. Seller and Buyer
shall jointly and severally indemnify and hold the Escrow Agent harmless from
and against all Liabilities (including reasonable attorneys’ fees, expenses and
disbursements) incurred in connection with the performance of the Escrow Agent’s
duties hereunder, except with respect to actions or omissions taken or made by
the Escrow Agent in bad faith, in disregard of this Agreement or involving
negligence on the part of the Escrow Agent.

 

13.5         Taxes. Notwithstanding any provision of this Agreement to the
contrary, all interest earned on the Escrow Deposits shall be the property of
Buyer and shall be paid to Buyer at such time as the Escrow Deposit is
distributed by Escrow Agent to Buyer or Seller. Buyer shall pay any income taxes
on any interest earned on the Escrow Deposits. Buyer represents and warrants to
the Escrow Agent that its taxpayer identification number is 27-3305944.

 

13.6         Execution By Escrow Agent. The Escrow Agent has executed this
Agreement in the place indicated on the signature page hereof in order to
confirm that the Escrow Agent has received and shall hold the Escrow Deposits,
in escrow, and shall disburse the Escrow Deposits pursuant to the provisions of
this Article 13.

 

ARTICLE 14 - Lease Expenses

 

14.1         Leasing. Between the date hereof and the Closing Date, Seller shall
not change its current leasing or management practices without the prior written
approval of Buyer, which approval shall not be unreasonably withheld or delayed.
Seller shall provide Buyer with information outlining any such proposed changes
to such leasing or management practices, and Buyer shall have three (3) Business
Days to provide written approval or disapproval of such proposed changes;
provided, however, that failure of Buyer to respond within such three (3)
Business Day period shall be deemed to constitute approval of such proposed
changes. Between the date hereof and the Closing Date, Seller will cause vacant
apartment units at the Property to be “made ready” for reletting and occupancy
in accordance with Seller’s current standards and timetable for turning units
over. It is not the intention of Seller to have all of the vacant units “made
ready” as of the Closing Date, but only those units that would have been “made
ready” in the ordinary course of business.

 

14.2         Lease Enforcement. Until Closing Seller shall have the right, but
not the obligation (except to the extent that Seller’s failure to act shall
constitute a waiver of such rights or remedies), to enforce the rights and
remedies of the landlord under any Lease, by summary proceedings or otherwise
(including, without limitation, the right to remove any tenant), and to apply
all or any portion of any security deposits then held by Seller toward any loss
or damage incurred by Seller by reason of any defaults by tenants, and the
exercise of any such rights or remedies shall not affect the obligations of
Buyer under this Agreement in any manner or entitle Buyer to a reduction in, or
credit or allowance against, the Purchase Price or give rise to any other claim
on the part of Buyer.

 

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ARTICLE 15 - MISCELLANEOUS

 

15.1         Buyer’s Assignment. Buyer shall have the right to cause Seller to
convey the Property to an Affiliate of Buyer (as defined herein) and or any of
the Identified SPEs (as defined herein), and which assignee shall be designated
in writing by Buyer by the delivery to Seller of a written assignment of this
Agreement pursuant to which Buyer's obligations hereunder are expressly assumed
by such assignee and by delivery to Seller of evidence reasonably satisfactory
to Seller of the valid legal existence of Buyer's assignee, its qualification
(if necessary) to do business in the jurisdiction in which the Property is
located and of the authority of Buyer's assignee to execute and deliver any and
all documents required of Buyer under the terms of this Agreement, which items
shall be received by Seller not less than three (3) Business Days prior to the
Closing Date. As used herein, the term “Affiliate” shall mean any one or more
entities directly or indirectly controlled by, in control of or under common
control with Buyer. Notwithstanding the foregoing, the exercise of such right by
Buyer shall not relieve Buyer of any of its obligations and liabilities
hereunder including obligations and liabilities which survive the Closing or the
termination of this Agreement, nor shall any such assignment alter, impair or
relieve such assignee from the waivers, acknowledgements and agreements of Buyer
set forth herein, including, but not limited to, those set forth in Article 5,
Article 9 and Article 10 hereof, all of which are binding upon the assignee of
Buyer. Except as expressly provided to the contrary by the immediately preceding
sentence, Buyer shall not assign this Agreement or its rights hereunder to any
individual or entity without the prior written consent of Seller, which consent
Seller may grant or withhold in its sole and absolute discretion, and any such
assignment shall be null and void ab initio. In the event of any permitted
assignment by Buyer, any assignee shall assume any and all obligations and
liabilities of Buyer under this Agreement but, notwithstanding such assumption,
Buyer shall continue to be liable hereunder. As used herein, the term
“Identified SPEs” include the following Delaware limited liability companies:
(i) ARHC ATASHNC01, LLC, (ii) ARHC ATATHGA01, LLC, (iii) ARHC ATATLGA01, LLC,
(iv) ARHC ATDECGA01, LLC, (v) ARHC ATKNOTN01, LLC, (vi) ARHC ATLARFL01, LLC,
(vii) ARHC BTFMYFL01, LLC , (viii) ARHC BTNAPFL01, LLC, and (ix) ARHC ATDECGA02,
LLC.

 

15.2         Designation Agreement. Section 6045(e) of the United States
Internal Revenue Code and the regulations promulgated thereunder (herein
collectively called the “Reporting Requirements”) require an information return
to be made to the United States Internal Revenue Service, and a statement to be
furnished to Seller, in connection with the Transaction. Escrow Agent is either
(i) the person responsible for closing the Transaction (as described in the
Reporting Requirements) or (ii) the disbursing title or escrow company that is
most significant in terms of gross proceeds disbursed in connection with the
Transaction (as described in the Reporting Requirements). Accordingly:

 

(a)          Escrow Agent is hereby designated as the “Reporting Person” (as
defined in the Reporting Requirements) for the Transaction. Escrow Agent shall
perform all duties that are required by the Reporting Requirements to be
performed by the Reporting Person for the Transaction.

 

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(b)          Seller and Buyer shall furnish to Escrow Agent, in a timely manner,
any information requested by Escrow Agent and necessary for Escrow Agent to
perform its duties as Reporting Person for the Transaction.

 

(c)          Escrow Agent hereby requests Seller to furnish to Escrow Agent
Seller’s correct taxpayer identification number. Seller acknowledges that any
failure by Seller to provide Escrow Agent with Seller’s correct taxpayer
identification number may subject Seller to civil or criminal penalties imposed
by law. Accordingly, Seller hereby certifies to Escrow Agent, under penalties of
perjury, that the correct taxpayer identification numbers for the entities
comprising Seller are as follows:

 

(i)SHP III/ARBOR ASHEVILLE, LLC: 20 4218639

(ii)SHP III/ARBOR ATHENS, LLC: 20 4218469

(iii)SHP III/ARBOR CASCADE, LLC: 20 4218598

(iv)SHP III/ARBOR DECATUR, LLC: 20 4218556

(v)SHP III/ARBOR KNOXVILLE, LLC: 20 4218388

(vi)SHP III BARRINGTON TERRACE, LLC: 20 4504921

(vii)SHP III HERON FORT MYERS, LLC: 20 4021236

(viii)SHP III HERON NAPLES, LLC: 20 4021236

(ix)SHP III LAWRENCEVILLE, LLC : 26 2426702

 

(d)          Each of the parties hereto shall retain this Agreement for a period
of four (4) years following the calendar year during which Closing occurs.

 

15.3         Survival/Merger. Except for the provisions of this Agreement which
are explicitly stated to survive the Closing, (a) none of the terms of this
Agreement shall survive the Closing, and (b) the delivery of the Deed and any
other documents and instruments by Seller and the acceptance thereof by Buyer
shall effect a merger, and be deemed the full performance and discharge of every
obligation on the part of Buyer and Seller to be performed hereunder.

 

15.4         Integration; Waiver. This Agreement, together with the Exhibits
hereto, embodies and constitutes the entire understanding between the parties
with respect to the Transaction and all prior agreements, understandings,
representations and statements, oral or written, are merged into this Agreement.
Neither this Agreement nor any provision hereof may be waived, modified,
amended, discharged or terminated except by an instrument signed by the party
against whom the enforcement of such waiver, modification, amendment, discharge
or termination is sought, and then only to the extent set forth in such
instrument. No waiver by either party hereto of any failure or refusal by the
other party to comply with its obligations hereunder shall be deemed a waiver of
any other or subsequent failure or refusal to so comply.

 

15.5         Governing Law. This Agreement shall be governed by, and construed
in accordance with, the law of the State of Georgia.

 

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15.6         Captions Not Binding; Exhibits. The captions in this Agreement are
inserted for reference only and in no way define, describe or limit the scope or
intent of this Agreement or of any of the provisions hereof. All Exhibits
attached hereto shall be incorporated by reference as if set out herein in full.

 

15.7         Binding Effect. This Agreement shall be binding upon and shall
inure to the benefit of the parties hereto and their respective successors and
permitted assigns.

 

15.8         Severability. If any term or provision of this Agreement or the
application thereof to any persons or circumstances shall, to any extent, be
invalid or unenforceable, the remainder of this Agreement or the application of
such term or provision to persons or circumstances other than those as to which
it is held invalid or unenforceable shall not be affected thereby, and each term
and provision of this Agreement shall be valid and enforced to the fullest
extent permitted by law.

 

15.9         Notices. Any notice, request, demand, consent, approval and other
communications under this Agreement shall be in writing, and shall be deemed
duly given or made at the time and on the date when received by email (provided
that the sender of such communication shall orally confirm receipt thereof by
the appropriate parties and send a copy of such communication to the appropriate
parties by one of the other permitted methods within one (1) Business Day of
such email) or when personally delivered as shown on a receipt therefor (which
shall include delivery by a nationally recognized overnight delivery service
such as Federal Express, UPS Next Day Air, Purolator Courier or Airborne
Express), to the address for each party set forth below. Any party, by written
notice to the other in the manner herein provided, may designate an address
different from that set forth below.

 

If to Buyer: American Realty Capital V, LLC   405 Park Avenue, 15th Floor   New
York, New York 10022   Attention:  Edward M Weil., Jr.   Telephone
No.:  877.373.2522   Email:  mweil@arlcap.com     with a copy to: American
Realty Capital V, LLC   405 Park Avenue, 15th Floor   New York, New York 10022  
Attention:  Jesse Galloway   Telephone No.:  877.373.2522  
Email:  jgalloway@arlcap.com

 

- 38 -

 

 

with a copy (which will Foley & Lardner LLP not constitute notice) to: 111 North
Orange Avenue   Suite 1800   Orlando, Florida  32801   Attention: Michael A.
Okaty   Telephone No.:  407.423.7656   Email:  mokaty@foley.com     If to
Seller: SHP III/ARBOR ASHEVILLE, LLC   SHP III/ARBOR ATHENS, LLC   SHP III/ARBOR
CASCADE, LLC   SHP III/ARBOR DECATUR, LLC   SHP III/ARBOR KNOXVILLE, LLC   SHP
III BARRINGTON TERRACE, LLC   SHP III HERON FORT MYERS, LLC   SHP III HERON
NAPLES, LLC   SHP III LAWRENCEVILLE, LLC   c/o Prudential Real Estate Investors
  3348 Peachtree Road, Suite 1100   Atlanta, GA  30326   Attention:  John W.
Dark   Telephone No.:  404.704.3778   Email:  john.dark@prudential.com     with
a copy to: The Prudential Insurance Company of America   PREI Law Department   7
Giralda Farms   Madison, NJ  07940   Attention:  Law Department (Joan N. Hayden)
  Telephone No.:  973.683.1772   Email:  joan.hayden@prudential.com     with a
copy to: Alston & Bird LLP   1201 West Peachtree Street   Atlanta,
Georgia  30309-3424   Attention:  Mark C. Rusche, Esq.   Telephone
No.:  404.881.7281   Email:  mark.rusche@alston.com

 

15.10         Counterparts. This Agreement may be executed in counterparts, each
of which shall be an original and all of which counterparts taken together shall
constitute one and the same agreement.

 

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15.11         No Recordation. Seller and Buyer each agrees that neither this
Agreement nor any memorandum or notice hereof shall be recorded and Buyer agrees
(a) not to file any notice of pendency or other instrument (other than a
judgment) against the Property or any portion thereof in connection herewith and
(b) to indemnify Seller against all Liabilities (including reasonable attorneys’
fees, expenses and disbursements) incurred by Seller by reason of the filing by
Buyer of such notice of pendency or other instrument. Notwithstanding the
foregoing, if the same is permitted pursuant to applicable Laws, Buyer shall be
entitled to record a notice of lis pendens if Buyer is entitled to seek (and is
actually seeking) specific performance of this Agreement by Seller in accordance
with the terms of Section 11.2 hereof.

 

15.12         Additional Agreements; Further Assurances. Subject to the terms
and conditions herein provided, each of the parties hereto shall execute and
deliver such documents as the other party shall reasonably request in order to
consummate and make effective the Transaction; provided, however, that the
execution and delivery of such documents by such party shall not result in any
additional liability or cost to such party.

 

15.13         Construction. The parties acknowledge that each party and its
counsel have reviewed and revised this Agreement and that the normal rule of
construction to the effect that any ambiguities are to be resolved against the
drafting party shall not be employed in the interpretation of this Agreement or
any amendment hereof or Exhibit hereto.

 

15.14         Maximum Aggregate Liability. Notwithstanding any provision to the
contrary contained in this Agreement or any documents executed by Seller
pursuant hereto or in connection herewith, the maximum aggregate liability of
each party that comprises Seller and the maximum aggregate amount which may be
awarded to and collected by Buyer, in connection with the Transaction, the
Property, under this Agreement and under any and all documents executed pursuant
hereto or in connection herewith (including, without limitation, in connection
with the breach of any of Seller’s Warranties for which a claim is timely made
by Buyer) shall not exceed (i) One Million and No/100 Dollars ($1,00,000.00) per
Facility (i.e. per Seller), or (ii) Four Million and No/100 Dollars
($4,000,000.00) in the aggregate (for all Facilities and all Sellers). The
provisions of this section shall survive the Closing (and not be merged therein)
or any earlier termination of this Agreement.

 

15.15         Time of The Essence. Time is of the essence with respect to this
Agreement.

 

15.16         Waiver of Jury Trial. EACH PARTY HEREBY WAIVES TRIAL BY JURY IN
ANY PROCEEDINGS BROUGHT BY THE OTHER PARTY IN CONNECTION WITH ANY MATTER ARISING
OUT OF OR IN ANY WAY CONNECTED WITH THE TRANSACTION, THIS AGREEMENT, THE
PROPERTY OR THE RELATIONSHIP OF BUYER AND SELLER HEREUNDER. THE PROVISIONS OF
THIS SECTION SHALL SURVIVE THE CLOSING (AND NOT BE MERGED THEREIN) OR ANY
EARLIER TERMINATION OF THIS AGREEMENT.

 

- 40 -

 

 

15.17         Facsimile Signatures. Signatures to this Agreement transmitted by
telecopy shall be valid and effective to bind the party so signing. Each party
agrees to promptly deliver an execution original to this Agreement with its
actual signature to the other party, but a failure to do so shall not affect the
enforceability of this Agreement, it being expressly agreed that each party to
this Agreement shall be bound by its own telecopied signature and shall accept
the telecopied signature of the other party to this Agreement.

 

15.18         Jurisdiction. WITH RESPECT TO ANY SUIT, ACTION OR PROCEEDINGS
RELATING TO THE TRANSACTION, THIS AGREEMENT, THE PROPERTY OR THE RELATIONSHIP OF
BUYER AND SELLER HEREUNDER (“PROCEEDINGS”) EACH PARTY IRREVOCABLY (A) SUBMITS TO
THE EXCLUSIVE JURISDICTION OF THE COURTS OF THE COUNTY OF NEW CASTLE, STATE OF
DELAWARE AND THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF DELAWARE, AND
(B) WAIVES ANY OBJECTION WHICH IT MAY HAVE AT ANY TIME TO THE LAYING OF VENUE OF
ANY PROCEEDINGS BROUGHT IN ANY SUCH COURT, WAIVES ANY CLAIM THAT SUCH
PROCEEDINGS HAVE BEEN BROUGHT IN AN INCONVENIENT FORUM AND FURTHER WAIVES THE
RIGHT TO OBJECT, WITH RESPECT TO SUCH PROCEEDINGS, THAT SUCH COURT DOES NOT HAVE
JURISDICTION OVER SUCH PARTY. THE PROVISIONS OF THIS SECTION SHALL SURVIVE THE
CLOSING (AND NOT BE MERGED THEREIN) OR ANY EARLIER TERMINATION OF THIS
AGREEMENT.

 

[Remainder of page intentionally left blank;

Signature pages follow]

 

- 41 -

 

 

IN WITNESS WHEREOF, each party hereto has caused this Agreement to be duly
executed on its behalf on the day and year first above written.

 

  SELLER:       SHP III/ARBOR ASHEVILLE, LLC,   a Delaware limited liability
company       By: Senior Housing Partners III, L.P., a Delaware limited
partnership, its Sole Member         By: Senior Housing Partners III, L.L.C,    
  a Delaware limited liability company,       its General Partner           By:
Prudential Investment Management, Inc., a New Jersey corporation,         its
Managing Member                     By: /s/ John W. Dark           John W. Dark
          Vice-President

 

[Signatures Continued on Next Page]

 

- 42 -

 

 

  SHP III/ARBOR ATHENS, LLC,   a Delaware limited liability company       By:
Senior Housing Partners III, L.P., a Delaware limited partnership, its Sole
Member         By: Senior Housing Partners III, L.L.C,       a Delaware limited
liability company,       its General Partner           By: Prudential Investment
Management, Inc., a New Jersey corporation,         its Managing Member        
          By: /s/ John W. Dark           John W. Dark           Vice-President

 

  SHP III/ARBOR CASCADE, LLC,   a Delaware limited liability company       By:
Senior Housing Partners III, L.P., a Delaware limited partnership, its Sole
Member           By: Senior Housing Partners III, L.L.C,       a Delaware
limited liability company,       its General Partner             By: Prudential
Investment Management, Inc., a New Jersey corporation,         its Managing
Member               By: /s/ John W. Dark           John W. Dark          
Vice-President

 

[Signatures Continued on Next Page]

 

- 43 -

 

 

  SHP III/ARBOR DECATUR LLC,   a Delaware limited liability company            
By: Senior Housing Partners III, L.P., a Delaware limited partnership, its Sole
Member               By: Senior Housing Partners III, L.L.C,       a Delaware
limited liability company,       its General Partner                 By:
Prudential Investment Management, Inc., a New Jersey corporation,         its
Managing Member                   By: /s/ John W. Dark           John W. Dark  
        Vice-President             SHP III/ARBOR KNOXVILLE, LLC,   a Delaware
limited liability company             By: Senior Housing Partners III, L.P., a
Delaware limited partnership, its Sole Member               By: Senior Housing
Partners III, L.L.C,       a Delaware limited liability company,       its
General Partner                 By: Prudential Investment Management, Inc., a
New Jersey corporation,         its Managing Member                   By: /s/
John W. Dark           John W. Dark           Vice-President

 

[Signatures Continued on Next Page]

 

- 44 -

 

 

  SHP III BARRINGTON TERRACE, LLC,   a Delaware limited liability company      
      By: Senior Housing Partners III, L.P., a Delaware limited partnership, its
Sole Member               By: Senior Housing Partners III, L.L.C,       a
Delaware limited liability company,       its General Partner                
By: Prudential Investment Management, Inc., a New Jersey corporation,        
its Managing Member                   By: /s/ John W. Dark           John W.
Dark           Vice-President             SHP III HERON FORT MYERS, LLC,   a
Delaware limited liability company             By: Senior Housing Partners III,
L.P., a Delaware limited partnership, its Sole Member               By: Senior
Housing Partners III, L.L.C,       a Delaware limited liability company,      
its General Partner                 By: Prudential Investment Management, Inc.,
a New Jersey corporation,         its Managing Member                   By: /s/
John W. Dark           John W. Dark           Vice-President

 

[Signatures Continued on Next Page]

 

- 45 -

 

 

  SHP III HERON NAPLES, LLC,   a Delaware limited liability company            
By: Senior Housing Partners III, L.P., a Delaware limited partnership, its Sole
Member               By: Senior Housing Partners III, L.L.C,       a Delaware
limited liability company,       its General Partner                 By:
Prudential Investment Management, Inc., a New Jersey corporation,         its
Managing Member                   By: /s/ John W. Dark           John W. Dark  
        Vice-President             SHP III LAWRENCEVILLE LLC,   a Georgia
limited liability company             By: Senior Housing Partners III, L.P., a
Delaware limited partnership, its Sole Member               By: Senior Housing
Partners III, L.L.C,       a Delaware limited liability company,       its
General Partner                 By: Prudential Investment Management, Inc., a
New Jersey corporation,         its Managing Member                   By: /s/
John W. Dark           John W. Dark           Vice-President

 

[Signatures Continued on Next Page]

 

- 46 -

 

 

  BUYER:           AMERICAN REALTY CAPITAL V, LLC,     a Delaware limited
liability company             By: /s/ Edward M. Weil, Jr.     Edward M. Weil,
Jr.     Title: President             Date:   , 2013

 

- 47 -

 

 

The undersigned has executed this Agreement solely to confirm its agreement to
(i) hold the Escrow Deposits in escrow in accordance with the provisions hereof
and (ii) comply with the provisions of Article 13 and Section 15.2.

 

  ESCROW AGENT:       STEWART TITLE GUARANTY COMPANY       By: /s/ Annette M.
Comer     Name: Annette M. Comer     Title: Vice President       Date:  May 24,
2013

 

- 48 -

 

  

EXHIBIT A-1

 

LEGAL DESCRIPTION (Asheville)

 

Beginning at an existing iron pin, said iron pin being located at the
intersection of the western margin of U.S. Hwy. 25-A (Sweeten Creek Road) and
the northern margin of Rathfamham Road, said iron pin also being located North
17 degrees, 12 minutes 10 seconds West 32.73’ from an existing railroad spike at
the northeastern corner of Tract 3 of the property as conveyed in Deed Book
1317, at page 50 in the Buncombe County Registry, said iron pin also being
located North 10 degrees, 50 minutes, 59 seconds West, 4294.86 feet from NCGS
“Royal Pines” which has NAD 83 Grid Coordinates of N-646, 116.88’ and E-953,
601.89’ and runs thence from said beginning point now established South 76
degrees, 54 minutes, 43 seconds West 199.96 feet to an iron pin, thence South 7
degrees, 53 minutes, 17 seconds East 9.64 feet to an iron pin; thence South 61
degrees, 26 minutes, 43 seconds West 93.10 feet to an iron pin; thence South 51
degrees, 13 minutes, 43 seconds West 20.68 feet to an existing iron pin; thence
with the eastern line of Ravencroft Condominiums as found in Plat Book 50, at
page 84 in the Buncombe County Registry, North 18 degrees, 55 minutes, 54
seconds West, 462.57 feet to an existing iron pin; thence with the southern
boundary of the property as conveyed to Sweeten Creek Apartments, LLC, as found
in Deed Book 2079, at page 389 in the Buncombe County Registry North 77 degrees,
03 minutes, 43 seconds East 414.31 feet to an existing iron pin; thence North 77
degrees 03 minutes 43 seconds East 14.76 feet to an existing iron pin located at
the edge of the pavement of U.S. Highway 25-A; thence with the margin of the
pavement South 4 degrees, 21 minutes, 17 seconds East 208.95 feet to an existing
nail; thence leaving the margin of the road South 76 degrees, 59 minutes, 43
seconds West 22.69 feet to an iron pin; thence South 8 degrees 04 minutes, 17
seconds East 209.95 feet to the point and place of Beginning. Containing 3.579
acres, according to a survey by Cipar, Ingle, Anders & Associates, Inc., Job #
7191.

 

Also conveyed herewith are the following tracts, without warranties of title:

 

Being all the grantors, right, title and interest in and to the following
described parcel, the first lying west on U.S. Highway 25-A and the second lying
to the North of Rathfarmham Road.

 

Tract 1:

 

BEGINNING at an iron stake located at the southeastern most corner of the
property described above located at the intersection of the western margin of
U.S. Highway 25-A and the northern margin of Rathfarnham Road and runs hence
from said beginning point in a northerly direction and with the parcel above
described North 8 degrees, 04 minutes, 17 seconds West 209.95 feet to an iron
pin; thence North 76 degrees, 59 minutes, 43 seconds East 22.69 feet to an
existing nail in the western margin of U.S. Highway 25-A; thence with the margin
of the pavement of said highway South 3 degrees, 56 minutes, 23 seconds East
96.05 feet to a point; thence South 4 degrees, 12 minutes 13 seconds East, 89.15
feet to a point; thence South 1 degree, 12 minutes, 09 seconds East 11.59 feet
to a point; thence South 13 degrees, 47 minutes, 25 seconds West 10.64 feet to a
point; thence South 25 degrees, 39 minutes, 26 seconds West 7.21 feet to a
point; thence North 63 degrees, 07 minutes, 22 seconds West, 0.39 feet to the
point and place of Beginning. Containing 0.072 acres and shown as Tract 1 on the
above referred to plat.

 

A-1 – Page 1

 

 

Tract 2:

 

BEGINNING at an iron stake located at the southeastern most corner of the 3.579
acres described above, also located at the intersection of the western margin of
U.S. Highway 25-A and the northern margin of Rathfarnham Road and runs thence
from said beginning point in a westerly direction with the 3.579 acres parcel
described above South 76 degrees, 54 minutes, 43 seconds West 199.96 feet to an
iron pipe, thence South 7 degrees, 53 minutes, 17 seconds East 9.64 feet to an
existing iron pipe; thence South 61 degrees, 26 minutes, 43 seconds West 93.10
feet to an iron pipe; thence South 51 degrees, 13 minutes, 43 seconds West 20.68
feet to an iron pin, a corner of the Ravencroft Condominium property as shown in
Plat Book 50, at page 84 in Buncombe County Registry, thence leaving the
Ravencroft Condominium property and runs South 34 degrees, 24 minutes, 29
seconds East, 7.11 feet to a point in the margin of the pavement of Rathfarnham
Road, thence with Rathfarnham Road the next eighteen (18) calls and distances,
North 55 degrees, 54 minutes, 07 seconds East 7.00 feet to a point; thence North
56 degrees, 20 minutes, 39 seconds East 20.49 feet to a point; thence North 57
degrees, 58 minutes, 45 seconds East, 14.12 feet to a point; thence North 60
degrees, 42 minutes, 33 seconds East, 17.09 feet to a point; thence North 62
degrees, 38 minutes, 12 seconds East, 12.48 feet to a point; thence North 64
degrees, 47 minutes, 27 seconds East 18.19 feet to a point; thence North 67
degrees, 28 minutes, 31 seconds East 32.56 feet to a point; thence North 71
degrees, 16 minutes, 15 seconds East, 14.57 feet to a point; thence North 71
degrees, 13 minutes, 20 seconds East, 13.58 feet to a point; thence North 72
degrees, 11 minutes, 25 seconds East. 24.22 feet to a point; thence North 75
degrees, 19 minutes, 46 seconds East, 34.75 feet to a point; thence North 75
degrees, 47 minutes, 03 seconds East 28.60 feet to a point; thence North 76
degrees, 54 minutes, 59 seconds East, 34.58 feet to a point; thence North 73
degrees, 11 minutes, 12 seconds East 20.11 feet to a point; thence North 63
degrees, 31 minutes, 24 seconds East, 6.18 feet to a point; thence North 51
degrees, 36 minutes, 13 seconds East, 3.98 feet to a point; thence North 42
degrees, 40 minutes, 54 seconds East 6.51 feet to a point; thence North 33
degrees, 18 minutes, 10 seconds East 5.91 feet to a point; thence North 63
degrees, 07 minutes, 22 seconds West, 0.39 feet to the point and place of
BEGINNING. Containing 0.083 acres and shown as Tract 2 on the above referred to
plat.

 

A-1 – Page 2

 

  

EXHIBIT A-2

 

LEGAL DESCRIPTION (Athens)

 

TRACT 1

 

ALL THAT TRACT OR PARCEL OF LAND LYING AND BEING in GMD 241 of Athens, Clarke
County, Georgia, and being more particularly described as follows:

 

Commence at a point at the Southeasterly corner of the terminus of the
right-of-way margin of Crane Drive (60 foot right-of-way); thence run North
23°22’36” West for a distance of 478.79 feet to an iron pin, said point being
the True Point of Beginning; thence run North 23°22’36” West for a distance of
342.21 feet to an iron pin; thence run North 33°37’07” East for a distance of
229.98 feet to an iron pin; thence run North 42°34’13” East for a distance of
23.07 feet to an iron pin on the Southwesterly right-of-way margin of Mall
Connector Road (as per Deed Book 1847, Page 87, 60 foot right-of-way), said
point being the point of a curve to the right having a radius of 218.88 feet and
an arc distance of 105.55 feet; thence run along said curve to the right and
along said right-of-way margin a chord bearing of South 43°31’10” East and a
chord distance of 104.53 feet to an iron pin; thence run South 29°42’16” East
along said right-of-way margin for a distance of 202.32 feet to an iron pin,
said point being the point of a curve to the left having a radius of 124.18 feet
and an arc distance of 96.00; thence run along said curve to the left and along
said right-of-way margin a chord bearing of South 51°51’03” East and a chord
distance of 93.62 feet to an iron pin; thence run South 15°20’40” East for a
distance of 66,88 feet to an iron pin; thence run South 74°39’20” West for a
distance of 140.00 feet to an iron pin; thence run South 15°20’40” East for a
distance of 49.18 feet to an iron pin; thence run South 66°37’24” West for a
distance of 162.02 feet to a point and back to the True Point of Beginning.

 

Containing 109445.89 sq. ft or 2.51 acres more or less.

 

TRACT 2

 

ALL THAT TRACT OR PARCEL OF LAND LYING AND BEING in GMD 241 of Athens, Clarke
County, Georgia, and being more particularly described as follows:

 

Commence at a point at the Southeasterly Corner of the terminus of the
right-of-way margin of Crane Drive (60 foot right-of-way); thence run North
23°22’36” West for a distance of 478.79 feet to an iron pin; thence run North
23°22’36” West for a distance of 342.21 feet to an iron pin; thence run North
33°37’07” East for a distance of 229.98 feet to an iron pin; thence run North
42°34’13” East for a distance of 23.07 feet to an iron pin on the Southwesterly
right-of-way margin of Mall Connector Road (as per Deed Book 1847, Page 87, 60
foot right-of-way); thence run North 42°34’13” East across the right-of-way
margin of Mall Connector Road for a distance of 60.71 feet to an iron pin on the
Northeasterly right-of-way margin of Mall Connector Road, said point being the
True Point of Beginning; thence run North 42°34’13” East for a distance of 54.57
feet to an iron pin; thence run North 76°40’43” East for a distance of 57.60
feet to an iron pin; thence run South 15°20’40” East for a distance of 322.99
feet to an iron pin on the Northwesterly right-of-way margin of Mall Connector
Road; thence run North 29°42’16” West along said right-of-way margin for a
distance of 192.54 feet to an iron pin, said point being the point of a curve to
the left having a radius of 278.88 feet and an arc distance of 124.04 feet;
thence run along said curve to the left and along said right-of-way margin a
chord bearing of North 42°26’47” West and a chord distance of 123.02 feet to a
point and back to the True Point of Beginning.

 

A-2 – Page 1

 

 

Containing 14467.31 sq. ft or 0.33 acres more or less.

 

Said property being shown on that certain ALTA/ACSM Land Title Survey for
Prudential Arbor Terrace Project, prepared by Barbara L. Herring, GRLS No. 2785,
of Harvel & Associates, Inc., for Bock & Clark National Surveyors, designated as
Job No, 06036 and dated January 19, 2006, last revised March 22, 2006.

 

A-2 – Page 2

 

 

EXHIBIT A-3

 

LEGAL DESCRIPTION (Atlanta)

 

ALL THAT TRACT OR PARCEL OF LAND LYING AND BEING in Land Lot 247 of the 14th
District, Fulton County, Georgia, and being more particularly described as
follows:

 

BEGINNING at a point on the westerly right-of-way of interstate Highway 285
(limited access, right-of-way varies), said point being 1,941.91 feet southerly
along said right-of-way from the intersection of the westerly right-of-way of
Interstate Highway 285 and the north land. lot line of Land Lot 247, aforesaid
District; run thence along the westerly right-of-way of Interstate Highway 285
south 06° 02’ 02” west 402.85 feet to a concrete monument; thence continue along
said right-of-way and run south 06°21’ 12” west 306.55 feet to a concrete
monument; thence continue along said right-of-way and run south 00°23’ 43” west
257.33 feet to an iron pin; thence depart said right-of-way and run north 87°
55’ 56” west 70.00 feet to a point (herein referred to as “Point A”); thence run
north 87° 55’ 56” west 60+/- feet to the center line of South Utoy Creek; run
thence along the center line of South Utoy Creek and following the meanderings
thereof in a northwesterly direction 587+/-feet to a point on the easterly
right-of-way of Research Center Atlanta Drive (60 foot right-of-way) (herein
referred to as “Point B”); Point A and Point B are connected by a traverse line
running from Point A to Point B north 51° 19’ 40” west 564.07 feet; run thence
along the easterly right-of-way of Research Center Atlanta Drive north 24° 51’
49” east 105.90 feet to a point; thence continue along said right-of-way along
an arc of a curve to the left an arc distance of 97.59 feet, said arc having a
radius of 230.00 feet and being subtended by a chord having a bearing and
distance of north 12° 42’ 30” east 96.86 feet to a point; thence continue along
said right-of-way and run north 00° 33’ 12” east feet to a point; thence
continue along said right-of-way and run along the arc of a curve to the left an
arc distance of 155.66 feet, said arc having a radius of 230.00 feet and being
subtended by a chord having a bearing and distance of north 18° 48’ 31” west
152.70 feet to a point; thence leave said right-of-way and run south 89° 26’ 48”
east 569.13 feet to a point on the westerly right-of-way of interstate Highway
285 and the TRUE PLACE OR POINT OF BEGINNING.

 

Said property contains 10+/- acres as per ALTA/ACSM Land Title Survey for Arbor
Terrace-Cascade, LLC & Chicago Title Insurance Company by Barton Surveying,
Inc., certified by David Barton, GRLSN 2533, dated November 11,2000, last
revised December 18,2000.

 

TOGETHER WITH those rights arising under that certain Reciprocal Easement
Agreement by and between Home Depot U.S.A., Inc., a Delaware corporation and
Research Center/Atlanta Joint Venture, a joint venture consisting of Equitable
Variable Life Insurance Company, a New York corporation and Franconom, Inc., a
Pennsylvania corporation, dated as of October 17,1994, recorded in Deed Book
18891, Page 139, Records of Fulton County, Georgia.

 

A-3 – Page 1

 

 

EXHIBIT A-4

 

LEGAL DESCRIPTION (Decatur)

 

ALL THAT TRACT or parcel of land lying and being in Land Lot 8 18th District,
DeKalb County, Georgia, and being more particularly described as follows:

 

To find the POINT OF BEGINNING, begin at the intersection of the southern
right-of-way of Irvin Way (60- foot right-of-way) with the eastern right-of-way
of Winn Way (60 -foot right-of-way); thence southerly along the - eastern
right-of-way of Winn Way a distance of 1,021.22 feet to an iron pin (1/2 inch
rebar), which is the POINT OF BEGINNING. From the POINT OF BEGINNING, run South
89 degrees 47 minutes 00 seconds East 369.59 feet to an iron pin (1/2 inch
rebar), said iron pin being located South 00 degrees 27 minutes 20 seconds East
a distance of 6.83 feet from a 1/2 inch rebar found; thence run South 00 degrees
27 minutes 26 seconds East a distance of 234.70 feet to an iron pin (1/2 inch
rebar); thence North 89 degrees 47 minutes 00 seconds West a distance of 372.90
feet to an iron pin (1/2 inch rebar) found on the eastern right-of-way of Winn
Way (60-foot right-of-way); thence North 00 degrees 21 minutes 02 seconds East
along the eastern right-of-way of Winn Way a distance of 234.69 feet to the
POINT OF BEGINNING.

 

The aforesaid tract is shown on that certain ALTA/ACSM Land Title Survey of
Arbor Terrace, by Patterson & Dewar Engineers, Inc. (George E. Ingram; RLS),
dated April 12, 1991 (Drawing No. 247) and last revised November 20, 1995.

 

TOGETHER WITH all right, title and interest in and to that certain Storm Drain
Pipe Easement from Atlanta Retirement Residence Limited Partnership to Arbor
Terrace, L.P., dated April 8, 1992, recorded on April 27, 1992 in Deed Book
7256, Page 208, DeKalb County, Georgia records.

 

A-4 – Page 1

 

 

EXHIBIT A-5

 

LEGAL DESCRIPTION (Knoxville)

 

9051 Cross Park Dr., Knoxville, TN. Tax Parcel # 119-03322

 

SITUATE In the Sixth (6th) Civil District of Knox County, Tennessee, without the
corporate limits of the City of Knoxville, Tennessee and being more particularly
described as follows:

 

BEGINNING on an iron pin in the right of way of Cross Park Drive, said pin being
located 398.03 feet in an easterly direction from the intersection of Park
Village Road and Cross Park Drive; thence from said beginning and a severance
line North 22 deg. 50 min. West, 461.67 feet to an iron pin in the right of way
of Ten Mile Drive; thence with said right of way North 67 deg. 10 min. East,
267.6 feet to an iron pin, corner to Knox County Library; thence with said
property South 22 deg. 15 min. East, 449.74 feet to an iron pin in the right of
way of Cross Park Drive; thence with said right of way South 67 deg. 10 min.
West, 142.49 feet to an iron pin; thence continuing with said right of way and a
curve to the left the chord of which is South 61 deg. 22 min. West, 121.19 feet
(radius = 614.6 feet) to the POINT OF BEGINNING, containing 2.75 acres more or
less.

 

BEING the same property conveyed to ARBOR TERRACE OF KNOXVILLE, L.P. a Georgia
limited partnership by Deed of Record in Book 2210, Page 529, Register’s Office
for Knox County, Tennessee.

 

A-5 – Page 1

 

 

EXHIBIT A-6

 

LEGAL DESCRIPTION (Largo)

 

From the Southwest corner of the Northwest 1/4 of the Southeast 1/4 of Section
3, Township 30 South, Range 15 East, run thence South 89°02’43” East, along the
40 Acre Line, 1316.00 feet to the 40 Acre line; thence North 00°40’39” East,
along the 40 Acre Line, 846.03 feet to the Intersection of the extension of the
centerline of a 12-foot wide stream and the Point of Beginning; thence along the
extended centerline and the centerline of said 12-foot wide stream, South
81°38’03” West, 33.96 feet; thence along said centerline, North 79°31’58” West,
13.72 feet; thence along said centerline by the following ten courses: North
56°08’28” West, 17.61 feet; North 50°40’08” West, 49.69 feet; North 82°50’26”
West, 68.20 feet; South 76°08’29” West, 50.99 feet; South 73°51’03” West, 54.10
feet; South 50°01’59” West, 42.20 feet; South 41°41’23” West, 44.26 feet; South
42°53’26” West, 44.43 feet; South 36°04’24” West, 39.67 feet; South 48°42’29”
West, 7.94 feet; thence leaving said centerline of stream, North 00°08’58” East,
268.59 feet; thence North 89°14’57” West, 141.40 feet; thence North 00°08’58”
East, 280.00 feet to the Southerly right-of-way of 16th Avenue Southeast; thence
along said Southerly right-.of-way line, South 89°14’57” East, 535.76 feet to
the 40 Acre Line; thence along the 40 Acre Line, South 00°40’39” West, 433.62
feet to the Point of Beginning.

 

Less that portion conveyed to Pinellas County for right-of-way by Deed recorded
in Official Record Book 8043, Page 1916, Public Records of Pinellas County,
Florida..

 

TOGETHER WITH all rights and easements established pursuant to the Reciprocal
Declaration of Easement Agreement recorded in Official Records Book 7720, page
2320, public records of Pinellas County, Florida, including, but not limited to,
those easements and rights over the following described property for access,
Ingress and regress and utilities (including, but not limited to sewage lines,
electric lines, telephone lines, gas lines and water lines) and the right to
utilize storm sewers, retention ponds and other facilities for drainage of
surface water from said Parcel I:

 

A-6 – Page 1

 

 

Ingress, Egress Easement for the benefit of Parcel I, more particularly
described as follows:

From the Southwest corner of the Northwest 1/4 of the Southeast 1/4 of Section
3, Township 30 South, Range 15 East, Pinellas County, Florida, run thence South
89°02’43” East, along the 40 Acre Line, 933.41 feet; thence continue South
89°02’43” East, along the 40 Acre Line, 382.59 feet to the 40 Acre Line; thence
North 00°40’34” East, along the 40 Acre line, 1,296.55 feet to the South
right-of-way of 16th Avenue Southeast; thence along said right-of-way North
89°14’57” West, 179.00 feet to the Point of Beginning; thence South 00°45’03”
West, 44.72 feet; thence North 67°42’20” East, 51.44 feet; thence along the arc
of a curve to the right 211.11 feet, radius 82.50 feet, central angle
146°36’51”, chord bearing South 38°59’14” East, 158.05 feet; thence along the
arc of a curve to the left 21.66 feet, radius 20.00 feet, central angle
62°03’54”, chord bearing South 03°17’14” West, 20.62 feet; thence along the arc
of a curve to the right 173.79 feet, radius 224.00 feet, central angle
44°27’15”, chord bearing South 05o31’06” East, 169.47 feet; thence along the arc
of a curve to the left 47.01 feet, radius 168.00 feet, central angle 16o01’53”,
chord bearing South 08o41’35” West, 46.85 feet; thence South 00°40’39” West,
120.10 feet; thence along the arc of a curve to the right 83.77 feet, radius
64.00 feet, central angle 74°59’49”, chord bearing South 38°10’33” West, 77.92
feet; thence South 75°40’28” West, 87.15 feet; thence along the arc of a curve
to the right 61.07 feet; radius 104.00 feet, central angle 33°38’35”, chord
bearing North 87°30’15” West 60.19 feet; thence along the arc of a curve to the
left 56.72 feet, radius 56.00 feet, central angle 58°02’12”, chord bearing South
80°17’57” West, 54.33 feet; thence along a non tangent line North 38°43’09”
West, 24.00 feet; thence along the arc of a non tangent curve to the right 81.03
feet, radius 80.00 feet, central angle 58°02’12”, chord bearing North 80°17’57”
East, 77.61 feet; thence along the arc of a curve to the left 46.97 feet, radius
80.00 feet, central angle 33°38’35”, chord bearing South 87o30’15” East, 46.30
feet; thence North 75°40’28” East, 87.15 feet; thence along the arc of a curve
to the left 52.36 feet, radius 40.00 feet, central angle 74°59’49”, chord
bearing North 38°10’33” East, 48.70 feet; thence North 11°57’53” East, 122.61
feet; thence along the arc of curve to the right 53.72 feet, radius 192.00 feet,
central angle 16°01’53”, chord bearing North 08°41’35” East, 53.55 feet; thence
along the arc of a curve to the left 136.15 feet, radius 200.00 feet, central
angle 39°00’11”, chord bearing North 00°47’34” West, 133.53 feet; thence along
the arc of a non tangent curve to the left 170.15 feet, radius 58.50 feet,
central angle 166°39’04”, chord bearing North 28°58’08” West, 116.21 feet;
thence South 67o42’20” West, 118.16 feet; thence North 00o45’03” East, 92.92
feet; thence South 89°14’57” East, 52.00 feet to the Point of Beginning.

 

A 10.00 foot utility easement for the benefit of Parcel I, 5.00 feet each side
of the following described centerline:

 

From the Southwest corner of the Northwest 1/4 of the Southeast 1/4 of Section
3, Township 30 South, Range 15 East, Pinellas County, Florida, run thence South
89°02’43” East, along the 40 Acre Line, 1,316.00 feet to the 40 Acre Line;
thence North 00°40’39” East, along the 40 Acre Line, 846.03 feet to the
intersection of the extension of the centerline of a 12 foot wide stream; thence
along said stream centerline South 81°38’03” West, 24.30 feet to the Point of
Beginning of said centerline of easement; thence South 00°40’39” West, 56.48
feet; thence South 33°03’34” West, 47.00 feet; thence South 75°40’28” West,
100.00 feet; thence South 00°40’39” West 125.35 feet; thence South 69°10’48”
West, 168.16 feet to the termination of said centerline.

 

A-6 – Page 2

 

 

 

EXHIBIT A-7

 

LEGAL DESCRIPTION (Fort Mvers)

 

Lot C, SUMMERLIN PARK, according to the plat thereof recorded in Plat Book 64,
pages 72 through 74, Public Records of Lee County, Florida.

 

TOGETHER WITH non-exclusive permanent and perpetual easement over and upon
Tracts H, J and K of said SUMMERLIN PARK for the intended use and enjoyment
thereof as set forth and described in Article IV, Section 1 of that certain
Declaration of Covenants, Conditions and Restrictions for Summerlin Park
recorded in O.R. Book 3160, page 1536, Public Records of Lee County, Florida.

 

A-7 – Page 1

 

 

EXHIBIT A-8

 

LEGAL DESCRIPTION (Naples)

 

Tract L, LELY GOLF ESTATES, TRACT MAP, according to the plat thereof as recorded
in Plat Book 8, page 20, Public Records of Collier County, Florida.

 

A-8 – Page 1

 

 

EXHIBIT A-9

 

LEGAL DESCRIPTION (Lawrenceville-Land)

 

Parcel 1

 

All that tract or parcel of land lying and being in Land Lot 63 of the 18th
District, DeKalb County, Georgia, being Lot 6, Block 1, Sargent Hills, as per
plat recorded in Plat Book 14, page 132, DeKalb, County records, which plat is
incorporated herein by reference.

 

Parcel 2

 

All that tract or parcel of land lying and being in Land Lot 63 of the 18th
District, DeKalb County, Georgia, being Lot 5 of Block 1 of Sargent Hills
Subdivision, as per plat recorded in Plat Book 14, page 132, DeKalb County,
Georgia records, which plat is incorporated herein by reference, being more
particularly described as follows:

 

BEGINNING at a point on the southwesterly side of Orion Drive (formerly Murphy
Drive) 135 feet southeasterly along said street from its intersection with the
southeasterly side of Lawrenceville Highway, when said street lines are extended
to form an angle instead of a curve, said point being at the most eastern corner
of Lot 4, and running thence southeasterly along the southwesterly side of Orion
Drive, 90 feet to the most northern corner of Lot 6; thence southwesterly along
the line dividing Lots 5 and 6, a distance of 257.5 feet; thence northwesterly
along the line dividing Lot 5 from Lots 25 and 26, a distance of 108 feet;
thence northeasterly along the line dividing Lot 5 from Lot 3, a distance of 65
feet; thence northeasterly along the line dividing Lots 5 and 4, a distance of
191 feet to the southwesterly side of Orion Drive and the POINT OF BEGINNING,
being improved property known as No. 2729 Orion Drive (formerly No. 3435 Murphy
Drive), according to the present system of numbering houses in DeKalb County,
Georgia.

 

A-9 – Page 1

 

 

Parcel 3

 

TRACT 1:

 

All that tract or parcel of land lying and being in Land Lot 63 of the 18th
District, DeKalb County, Georgia, being part of Lots 1 and 2, Block 1, Sargent
Hills Subdivision as per plat recorded in Plat Book 14, page 132, DeKalb County,
Georgia records, being more particularly described as follows:

 

BEGINNING at an iron pin on southeasterly side of Lawrenceville Highway 156 feet
northeasterly from corner formed by intersection of the southeasterly side of
Lawrenceville Highway with northeasterly side of Hollywood Drive, if said street
line were extended to form an angle instead of a curve, and running thence
northeasterly, along the southeasterly side of Lawrenceville Highway, 100 feet
to an iron pin on the southwesterly line of Lot 3 of said Block and Subdivision;
running thence southeasterly, along southwesterly line of said Lot 3, 183.6 feet
to an iron pin; running thence southwesterly 100 feet to an iron pin, and
running thence northwesterly 184.9 feet to the southeasterly side of
Lawrenceville Highway and the POINT OF BEGINNING; being improved property having
a one-story brick house thereon known as 1899 Lawrenceville Highway according to
present numbering of houses in the City of Decatur and suburbs.

 

TRACT 2:

 

All that tract or parcel of land lying and being in Land Lot 63 of the 18th
District, DeKalb County, Georgia, being Lot 4, Block 1, of the Sargent Hills
Subdivision, as per plat of C. H. Faulkner and Associates, Inc., Engineers,
dated March 12,1947, recorded in Plat Book 14, page 132, DeKalb County, Georgia
records, which plat is incorporated herein by reference.

 

BEGINNING at a point on the east side of Lawrenceville Highway, 115 feet
southerly from the intersection of the south side of Orion Drive (formerly
Murphy Drive) with the east side of Lawrenceville Highway (if said streets were
extended to form an angle instead of a curve), which point is also the northwest
corner of Lot 3, said block and subdivision; running thence southeasterly along
the north line of said Lot 3, 184.6 feet to the west line of Lot 5, said block
and subdivision; thence northerly along the west line of Lot 5 of said block and
subdivision; 191 feet to the south side of Orion Drive; thence westerly along
the south side of Orion Drive 135 feet to the east side of Lawrenceville
Highway; thence southwesterly along the southeast side of Lawrenceville Highway
115 feet to the POINT OF BEGINNING.

 

LESS & EXCEPT that portion of said property used in rounding the intersection of
Orion Drive with Lawrenceville Highway; being improved property known as 2721
Orion Drive, Decatur, Georgia.

 

A-9 – Page 2

 

 

Parcel 4

 

All that tract or parcel of land lying and being in Land Lot 63 of the 18th
District, DeKalb County, Georgia, being part of Lot 2 and all of Lot 3, Block 1,
of the Sargent Hills Subdivision, being more particularly described as follows:

 

BEGINNING at a point on the easterly side of Lawrenceville Highway 115 feet
southwesterly from the intersection of the easterly side of Lawrenceville
Highway with the southerly side of Murphy Drive, thence continuing southerly
along the easterly side of Lawrenceville Highway 140 feet; thence southeasterly
183.6 feet; thence northeasterly 90 feet; thence northwesterly 184.6 feet to the
easterly side of Lawrenceville Highway and the POINT OF BEGINNING.

 

Parcel 5

 

All that tract or parcel of land lying and being in Land Lot 63 of the 18th
District, DeKalb County, Georgia, being parts of Lots 1 and 2, Block 1 of
Sargent Hills Subdivision, as per plat recorded in Plat Book 14, page 132,
DeKalb County, Georgia records, being more particularly described as follows:

 

BEGINNING at the northeast corner of Lawrenceville Highway and Hollywood Drive
and running thence northeasterly along the easterly side of Lawrenceville
Highway 156 feet; thence southeasterly 184.9 feet; thence southwesterly 133 feet
to the northerly side of Hollywood Drive; thence northwesterly along the
northerly side of Hollywood Drive, 190 feet to the POINT OF BEGINNING.

 

Parcel 6

 

All that tract or parcel of land lying and being in Land Lot 63 of the 18th
District, DeKalb County, Georgia records, being Lot 26, Block 1, Sargent Hills
Subdivision, as per plat recorded in Plat Book 14, page 132, DeKalb County
records, which plat is incorporated herein by reference, being improved property
known as No. 2706 Hollywood Drive, according to the present system of numbering
houses in DeKalb County, Georgia.

 

A-9 – Page 3

 

 

Parcel 7

 

All that tract or parcel of land lying and being in Land Lot 63 of the 18th
District, DeKalb County, Georgia, being Lot 25, Block 1, Sargent Hills
Subdivision, as per plat recorded in Plat Book 14, page 132, DeKalb County,
Georgia records, being more particularly described as follows:

 

BEGINNING at an open top found on the northeasterly side of Hollywood Drive (60
foot right of way) 270.0 feet southeasterly as measured along the northeasterly
side of Hollywood Drive from the intersection of the northeasterly side of
Hollywood Drive with the southeasterly right of way of Georgia Highway 78; run
thence south 65 degrees 23 minutes 58 seconds east along the northeasterly side
of Hollywood Drive a distance of 90.0 feet to a ‘A inch rebar found; run thence
north 30 degrees 15 minutes 45 seconds east a distance of 257.30 feet to a 1/2
inch rebar found; run thence north 66 degrees 18 minutes 56 seconds west a
distance of 77.0 feet to a V2 inch rebar found; run thence south 33 degrees 10
minutes 10 seconds west a distance of 257.69 feet to a 1/2 inch open top found
at the northeasterly side of Hollywood Drive and the POINT OF BEGINNING; being
more fully shown on plat of survey prepared by Advance Survey, Inc., dated
February 18, 2000.

 

A-9 – Page 4

 

 

EXHIBIT B

 

LIST OF CONTRACTS

 

[ONE PER FACILITY; ATTACHED HERETO]

 

B - Page 1

 

 

EXHIBIT C

 

Form of Buyer’s As-Is Certificate and Agreement

 

BUYER’S AS-IS CERTIFICATE and agreement

 

THIS BUYER’S AS-IS CERTIFICATE AND AGREEMENT (this “Agreement”), is made as of
_________________, 2013 by __________________________, a _______________________
(“Contract Buyer”) and _______________________, a _______________________
(“Assignee”; Contract Buyer and Assignee are herein referred to collectively as
“Buyer”) to and for the benefit of ______________________, a ___________________
(“Seller”).

 

RECITALS

 

WHEREAS, pursuant to the terms of that certain Purchase and Sale Agreement,
dated as of ______________, 2013, by and between Seller and Buyer (the “Sale
Agreement”), Seller agreed to sell to Buyer, inter alia, that certain real
property legally described on Exhibit A attached hereto and incorporated herein
by this reference, the improvements located thereon and certain rights
appurtenant thereto, all as more particularly described in the Sale Agreement.
Initially capitalized terms not otherwise defined herein shall have the
respective meanings ascribed to such terms in the Sale Agreement; and

 

WHEREAS, the Sale Agreement requires, inter alia, that, as a condition precedent
to Seller's obligations under the Sale Agreement, Buyer shall execute and
deliver this Agreement to Seller at Closing.

 

NOW, THEREFORE, in consideration of TEN AND NO/100 DOLLARS ($10.00) and other
good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, Buyer hereby certifies and agrees as follows:

 

1.          For purposes of this Agreement, the following terms shall have the
following meanings:

 

“Assumed Liabilities” shall mean any and all Liabilities attributable to the
Property, whether arising or accruing before, on or after the date hereof and
whether attributable to events or circumstances which have heretofore or may
hereafter occur, including, without limitation, (a) all Liabilities with respect
to the structural, physical, or environmental condition of the Property; (b) all
Liabilities relating to the release of or the presence, discovery or removal of
any Hazardous Materials in, at, about or under the Property, or for, connected
with or arising out of any and all claims or causes of action based upon CERCLA
(Comprehensive Environmental Response, Compensation, and Liability Act of 1980,
42 U.S.C. §§9601 et seq., as amended by SARA (Superfund Amendment and
Reauthorization Act of 1986) and as may be further amended from time to time),
the Resource Conservation and Recovery Act of 1976, 42 U.S.C. §§6901 et seq., or
any related claims or causes of action or any other federal, state or municipal
based statutory or regulatory causes of action for environmental contamination
at, in, about or under the Property; (c) any tort claims made or brought with
respect to the Property or the use or operation thereof; and (d) all Liabilities
relating to the condition or status of Seller’s or Buyer’s title to the
Property. Notwithstanding the foregoing, however, “Assumed Liabilities” shall
not include any Liabilities arising out of or in connection with:

 

C - Page 1

 

 

(i)          any claims made or causes of action alleging a default or breach by
Seller which is alleged to have occurred prior to the date hereof under any
Contract entered into between Seller and any such claimant unless Buyer knows or
is deemed to know about such claim or cause of action on or before the date
hereof; or

 

(ii)         any tort claims which arise from any acts or negligent omissions of
Seller as to which the claimed injury occurred during the time that Seller owned
fee title to the Property except to the extent:

 

(1)         Buyer has the right to seek recovery from any tenants or previous
tenants of the Property with respect to such tort claims; or

 

(2)         Buyer knows or is deemed to know about such claim on or before the
expiration of the Due Diligence Period; or

 

(3)         such tort claim arises or accrues as a result of the actual or
alleged release, presence, or discovery of any Hazardous Materials which Buyer
knows of or is deemed to know of on or before expiration of the Due Diligence
Period, in, at, or under the Property.

 

(iii)        any claims made or causes of action brought by any governmental
authority with respect to Hazardous Materials deposited or placed in, at, or
under the Property by Seller during the time that Seller owned fee title to the
Property except to the extent:

 

(A)         Buyer knows or is deemed to know of such claim or cause of action on
or before the expiration of the Due Diligence Period; or

 

(B)         Buyer has the right to seek recovery from any tenants or previous
tenants of the Property with respect to such claims or causes of action.

 

“Buyer’s Representatives” shall mean Buyer, any direct or indirect owner of any
beneficial interest in Buyer, and any officers, directors, employees, agents,
representatives and attorneys of Buyer or any such direct or indirect owner of
any beneficial interest.

 

“deemed to know” (or words of similar import) shall have the following meaning:

 

(a)Buyer shall be “deemed to know” of the existence of a fact or circumstance to
the extent that:

 

C - Page 2

 

 

(i)any Buyer’s Representative actually knows of such fact or circumstance, or

 

(ii)such fact or circumstance is disclosed by the Sale Agreement, any documents
executed by Seller for the benefit of, and delivered to, Buyer in connection
with the Closing, the Documents, any estoppel certificate executed by any tenant
of the Property and delivered to Buyer or any Buyer’s Representatives, or any
Buyer’s Reports.

 

(b)Buyer shall be “deemed to know” that any Seller’s Warranty is untrue,
inaccurate or incorrect to the extent that:

 

(i)any Buyer’s Representative has actual knowledge of information which is
inconsistent with such Seller’s Warranty, or

 

(ii)the Sale Agreement, any documents executed by Seller for the benefit of, and
delivered to, Buyer in connection with the Closing, the Documents, any estoppel
certificate executed by any tenant of the Property and delivered to Buyer or any
Buyer’s Representatives, or any Buyer’s Reports contains information which is
inconsistent with such Seller’s Warranty.

 

“Documents” shall mean the documents and instruments applicable to the Property
or any portion thereof that Seller or any of the other Seller Parties deliver or
make available to Buyer or Buyer’ Representatives prior to Closing or which are
otherwise obtained by Buyer or Buyer’s Representatives prior to Closing,
including, but not limited to, the Title Commitments, the Surveys, the Title
Documents, and the Property Documents.

 

“Due Diligence” shall mean examinations, inspections, investigations, tests,
studies, analyses, appraisals, evaluations and/or investigations with respect to
the Property, the Documents, and other information and documents regarding the
Property, including, without limitation, examination and review of title
matters, applicable land use and zoning Laws and other Laws applicable to the
Property, the physical condition of the Property, and the economic status of the
Property.

 

“Hazardous Materials” shall mean any substance, chemical, waste or material that
is or becomes regulated by any federal, state or local governmental authority
because of its toxicity, infectiousness, radioactivity, explosiveness,
ignitability, corrosiveness or reactivity, including, without limitation,
asbestos or any substance containing more than 0.1 percent asbestos, the group
of compounds known as polychlorinated biphenyls, flammable explosives, oil,
petroleum or any refined petroleum product.

 

“Liabilities” shall mean, collectively, any and all losses, costs, damages,
claims, liabilities, expenses, demands or obligations of any kind or nature
whatsoever.

 

C - Page 3

 

 

“Property Documents” shall mean, collectively, (a) the Leases, (b) the
Contracts, and (c) any other documents or instruments which constitute, evidence
or create any portion of the Property.

 

“Seller Parties” shall mean and include, collectively, (a) Seller; (b) its
counsel; (c) Seller’s Broker; (d) Seller’s property manager; (e) any direct or
indirect owner of any beneficial interest in Seller; (f) any officer, director,
employee, or agent of Seller, its counsel, Seller’s Broker, Seller’s property
manager or any direct or indirect owner of any beneficial interest in Seller;
and (g) any other entity or individual affiliated or related in any way to any
of the foregoing.

 

“Seller’s Warranties” shall mean Seller’s representations and warranties set
forth in Section 9.2 of the Sale Agreement and any documents executed by Seller
for the benefit of Buyer in connection with Closing, as the same may be deemed
modified or waived by Buyer pursuant to the terms of the Sale Agreement.

 

2.          Buyer acknowledges and agrees that, prior to the date hereof:
(a) Seller has made available to Buyer, or otherwise allowed Buyer access to,
the Property and all books, records and files of Seller and of the management
agent for the Property related to the Property (other than those books, records
or files containing Confidential Materials); (b) Buyer has conducted (or has
waived its right to conduct) all Due Diligence (including Due Diligence with
respect to Hazardous Materials) as Buyer considered necessary or appropriate;
(c) Buyer has reviewed, examined, evaluated and verified the results of its Due
Diligence to the extent it deems necessary or appropriate with the assistance of
such experts as Buyer deemed appropriate; (d) Buyer has determined to its
satisfaction the assignability of any Documents to be assigned as part of the
Transaction; and (e) except for, and only to the extent of, Seller’s Warranties,
is acquiring the Property based exclusively upon its own Due Diligence.

 

3.          Buyer acknowledges and agrees that, except for, and only to the
extent of, Seller’s Warranties:

 

(a)The Property is being sold, and Buyer is accepting possession of the Property
on the date hereof, “AS IS, WHERE IS, WITH ALL FAULTS”, with no right of setoff
or reduction in the Purchase Price.

 

(b)None of the Seller Parties have or shall be deemed to have made any verbal or
written representations, warranties, promises or guarantees (whether express,
implied, statutory or otherwise) to Buyer with respect to the Property, any
matter set forth, contained or addressed in the Documents (including, but not
limited to, the accuracy and completeness thereof) or the results of Buyer’s Due
Diligence.

 

(c)Buyer has confirmed independently all information that it considers material
to its purchase of the Property or the Transaction (other than Seller’s
Warranties, upon which Buyer is entitled to rely).

 

C - Page 4

 

 

(d)Buyer is not relying on (and Seller and each of the other Seller Parties does
hereby disclaim and renounce) any representations or warranties of any kind or
nature whatsoever, whether oral or written, express, implied, statutory or
otherwise, from Seller or any other Seller Parties, as to:

 

(i)the operation or performance of the Property, the income potential, economic
status, uses, or the merchantability, habitability or fitness of any portion of
the Property for a particular purpose;

 

(ii)the physical condition of the Property or the condition or safety of the
Property or any component thereof, including, but not limited to, plumbing,
sewer, heating, ventilating and electrical systems, roofing, air conditioning,
foundations, soils and geology, including Hazardous Materials, lot size, or
suitability of the Property or any component thereof for a particular purpose;

 

(iii)the presence or absence, location or scope of any Hazardous Materials in,
at, about or under the Property;

 

(iv)whether the appliances, if any, plumbing or utilities are in working order;

 

(v)the habitability or suitability for occupancy of any structure and the
quality of its construction;

 

(vi)whether the improvements are structurally sound, in good condition, or in
compliance with applicable Laws;

 

(vii)the accuracy of any statements, calculations or conditions stated or set
forth in the Documents, other books and records concerning the Property, or any
of Seller’s offering materials with respect to the Property;

 

(viii)the dimensions of the Property or the accuracy of any floor plans, square
footage, lease abstracts, sketches, or revenue or expense projections related to
the Property;

 

(ix)the locale of the Property, the leasing market for the Property, or the
market assumptions Buyer utilized in its analysis of the Property and
determination of the Purchase Price (such as rental rates, leasing costs,
vacancy and absorption rates, land values, replacement costs, maintenance and
operating costs, financing costs, etc.);

 

(x)whether the Property is or would likely constitute a target of terrorist
activity or other acts of war;

 

C - Page 5

 

 

(xi)the ability of Buyer to obtain any and all necessary governmental approvals
or permits for Buyer’s intended use and development of the Property; and

 

(xii)the leasing status of the Property or the intentions of any parties with
respect to the negotiation and/or execution of any lease for any portion of the
Property.

 

(e)Seller is under no duty to make any affirmative disclosures or inquiry
regarding any matter which may or may not be known to Seller or any of the other
Seller Parties, and Buyer, for itself and for its successors and assigns, hereby
specifically waives and releases Seller and each of the other Seller Parties
from any such duty that otherwise might exist.

 

4.           Any repairs or work required by Buyer are the sole responsibility
of Buyer, and Buyer agrees that there is no obligation on the part of Seller to
make any changes, alterations or repairs to the Property, including, without
limitation, to cure any violations of Law, comply with the requirements of any
insurer or otherwise. Buyer is solely responsible for obtaining any certificate
of occupancy or any other approval or permit necessary for the transfer or
occupancy of the Property and for any repairs or alterations necessary to obtain
the same, all at Buyer’s sole cost and expense.

 

5.           Except as expressly provided in the Sale Agreement or hereinbelow
in this Section 5, Buyer, for Buyer and Buyer’s successors and assigns, hereby
releases Seller and each of the other Seller Parties from, and waives any and
all Liabilities against Seller and each of the other Seller Parties for or
attributable to or in connection with the Property, whether arising or accruing
before, on or after the date hereof and whether attributable to events or
circumstances which have heretofore or may hereafter occur, including, without
limitation, the following:

 

(a)          any and all statements or opinions heretofore or hereafter made, or
information furnished, by the Seller Parties to Buyer or any of Buyer’s
Representatives; and

 

(b)          any and all Assumed Liabilities; and

 

(c)          any and all Liabilities relating to the release of or the presence,
discovery or removal of any Hazardous Materials in, at, about or under the
Property, or for, connected with or arising out of any and all claims or causes
of action based upon CERCLA (Comprehensive Environmental Response, Compensation,
and Liability Act of 1980, 42 U.S.C. §§9601 et seq., as amended by SARA
(Superfund Amendment and Reauthorization Act of 1986) and as may be further
amended from time to time), the Resource Conservation and Recovery Act of 1976,
42 U.S.C. §§6901 et seq., or any related claims or causes of action or any other
federal, state or municipal based statutory or regulatory causes of action for
environmental contamination at, in, about or under the Property; and

C - Page 6

 

 

(d)          any and all tort claims made or brought with respect to the
Property or the use or operation thereof; and

 

(e)          any implied or statutory warranties or guaranties of fitness,
merchantability or any other statutory or implied warranty or guaranty of any
kind or nature regarding or relating to any portion of the Property.

 

The release and waiver set forth in this Section 5 is not intended and shall not
be construed to affect or impair any rights or remedies that Buyer may have
against Seller as a result of a breach of any of Seller’s Warranties, nor is
such release and waiver intended to, and such release and waiver shall not be
construed to, affect or impair any rights or remedies that Buyer may have
against any third party, nor limit any defenses that Buyer may raise against
Seller or any third party, nor to prevent Buyer from bringing an impleader
action against Seller in the event a third party institutes an action against
Buyer or from otherwise joining Seller in any lawsuit commenced by a third party
with respect to the Property, or seeking contribution or reimbursement on any
such lawsuit from Seller, with respect to third party claims which Buyer can
reasonably demonstrate are attributable to events or circumstances that occurred
prior to the date hereof.

 

6.          Buyer hereby assumes and takes responsibility and liability for all
Assumed Liabilities.

 

7.          Buyer expressly understands and acknowledges that it is possible
that unknown Liabilities may exist with respect to the Property and that Buyer
explicitly took that possibility into account in determining and agreeing to the
Purchase Price, and that a portion of such consideration, having been bargained
for between parties with the knowledge of the possibility of such unknown
Liabilities has been given in exchange for a full accord and satisfaction and
discharge of all such Liabilities except as expressly provided in the Sale
Agreement.

 

8.          Buyer acknowledges and agrees that the provisions of this Agreement
were a material factor in Seller’s acceptance of the Purchase Price and, while
Seller has provided the Documents and cooperated with Buyer, Seller is unwilling
to sell the Property unless Seller and the other Seller Parties are expressly
released as set forth in Section 5.

 

9.          This Agreement shall be binding upon and shall inure to the benefit
of the parties hereto and their respective successors and permitted assigns.

 

10.        If any term or provision of this Agreement or the application thereof
to any persons or circumstances shall, to any extent, be invalid or
unenforceable, the remainder of this Agreement or the application of such term
or provision to persons or circumstances other than those as to which it is held
invalid or unenforceable shall not be affected thereby, and each term and
provision of this Agreement shall be valid and enforced to the fullest extent
permitted by law.

 

C - Page 7

 

 

IN WITNESS WHEREOF, Buyer has executed this Agreement as of the date first set
forth hereinabove.

 

  BUYER:       ____________________________, a
_______________________       By: ____________________________   Name:
_______________________   Title: ________________________       SELLER:      
_______________________,  a
_______________________       By: _____________________________   Name:
________________________   Title: _________________________

  

C - Page 8

 

 

EXHIBIT D

 

Form of Special Warranty Deed

 

[Insert Appropriate State Form

for Georgia, Florida, North Carolina and Tennessee]

 

(attached hereto)

 

D - Page 1

 

 

GEORGIA:

 

UPON RECORDING RETURN TO:   _________________   _________________  
_________________   _________________   Attention:  _________  

 

LIMITED WARRANTY DEED

 

STATE OF ____________

 

COUNTY OF __________

 

THIS INDENTURE, made this ____ day of ____________, 2013, between
_______________________________ (herein called "Grantor") and
_____________________________ (herein called "Grantee").

 

WITNESSETH: That Grantor, for and in consideration of the sum of Ten Dollars
($10.00) and other good and valuable consideration, in hand paid at and before
the sealing and delivery of these presents, the receipt and sufficiency of which
are hereby acknowledged, has granted, bargained, sold, aliened, conveyed and
confirmed and by these presents does grant, bargain, sell, alien, convey and
confirm unto Grantee all that tract or parcel of land described on Exhibit A,
attached hereto and made a part hereof.

 

TO HAVE AND TO HOLD the said bargained premises, together with all and singular
the rights, members and appurtenances thereof, to the same being, belonging or
in any wise appertaining, to the only proper use, benefit and behoof of Grantee,
forever, IN FEE SIMPLE.

 

This Deed and the warranty of title contained herein are made expressly subject
to the items set forth on Exhibit B attached hereto and made a part hereof.

 

Grantor will warrant and forever defend the right and title to the above
described property unto Grantee against the lawful claims of all persons owning,
holding or claiming by, through or under Grantor, but not otherwise.

 

(The words "Grantor" and "Grantee" include all genders, plural and singular, and
their respective heirs, successors and assigns where the context requires or
permits.)

 

D - Page 2

 

 

IN WITNESS WHEREOF, Grantor has signed and sealed this deed, the day and year
first above written.

 

 

Signed, sealed and delivered GRANTOR in the presence of:    
________________________________, __________________________ a
__________________________ Unofficial Witness     By:
______________________________ __________________________ Name:
_________________________ Notary Public Title: __________________________    
(NOTARY SEAL)       My Commission Expires:   __________________________  

 

D - Page 3

 

 

Exhibit A

Legal Description

 

(attached hereto)

 

D - Page 4

 

 

Exhibit B

Permitted Exceptions

 

[list to be completed]

 

D - Page 5

 

 

FLORIDA

 

Prepared By and Upon   Recording Return To:       _________________  
_________________   _________________   _________________  
Attention:  _________  

 

 

SPECIAL WARRANTY DEED

 

KNOW ALL MEN BY THESE PRESENTS that ________________________, a
________________________, whose mailing address is _____________________________
(“Grantor”), for and in consideration of the sum of Ten Dollars ($10.00) and
other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, has GRANTED, BARGAINED, SOLD and CONVEYED, and by these
presents does GRANT, BARGAIN, SELL and CONVEY unto
_____________________________, a ________________________, whose mailing address
is _____________________________ (“Grantee”), its successors and assigns, all of
that certain parcel of land located in ___________ County, Florida, more
particularly described in Exhibit “A” attached hereto and made a part hereof,
together with all improvements, tenements, hereditaments and appurtenances
thereto belonging or in anywise appertaining (the “Property”).

 

This conveyance is made by Grantor and accepted by Grantee subject only to the
matters set forth in Exhibit “B” attached hereto and made a part hereof (the
“Permitted Exceptions”), none of which are sought to be reimposed hereby.

 

TO HAVE AND TO HOLD the Property in fee simple forever.

 

Grantor does hereby COVENANT that (1) it is lawfully seized of the Property in
fee simple, and (2) that it has good, right and lawful authority to sell and
convey the Property. Further, Grantor hereby fully WARRANTS the title to the
Property, except for the Permitted Exceptions, and will FOREVER DEFEND all and
singular the Property unto Grantee, and its successors and assigns, against
every person whomsoever, lawfully claiming or to claim the same or any part
thereof, by, through or under Grantor, but not otherwise.

 

Effective as of the ____ day of ___________, 2013.

 

D - Page 6

 

 

Signed, sealed and delivered
in the presence of: _______________________, a
_________________________       By:  _________________________ _______________
Name:  _______________________ Print Name:  ________ Title:
_________________________     _______________   Print Name:  _______________  

 

STATE OF _____________ )   ) COUNTY OF __________ )

 

The foregoing instrument was acknowledged before me this _____ day of
___________, 2013, by ____________________, the ________________ of
_________________________, a _______________________________, on behalf of said
company. He is personally known to me or has produced
_________________________________ as identification.

 

        (Signature of Notary Public)                 (Typed name of Notary
Public)     Notary Public, State of Florida     Commission No.: ________     My
Commission Expires:     _______________  

 

D - Page 7

 

 

Exhibit A

Legal Description

 

(attached hereto)

 

D - Page 8

 

 

Exhibit B

Permitted Exceptions

 

[list to be completed]

 

D - Page 9

 

 

NORTH CAROLINA:

 

Excise Tax Recording Time, Book and Page

 

Tax Lot No.: _______________________         Parcel Identifier No.:
________________

 

Verified by _________________ County on the ____ day of ______________, 2013

 

By: _________________________

 

________________________________________________________________________

 

Mail after recording to: ______________________________, Attention:
_________________

 

This instrument was prepared by: ________________________________

 

Excise Tax: _______________________________

 

Brief description for the Index: ______________________________

 

D - Page 10

 

 

NORTH CAROLINA SPECIAL WARRANTY DEED

 

THIS DEED made this _____ day of ___________, 2013, by and between

 

GRANTOR

 

_______________________, whose mailing
address is _________________________

 

GRANTEE

 

_______________________, whose mailing
address is _________________________

 

 

________________________________________________________________________

 

The designation Grantor and Grantee as used herein shall include said parties,
their heirs, successors, and assigns, and shall include singular, plural,
masculine, feminine or neuter as required by context.

 

WITNESSETH, that the Grantor, for a valuable consideration paid by the Grantee,
the receipt of which is hereby acknowledged, has and by these presents does
grant, bargain, sell and convey unto the Grantee in fee simple, all that certain
lot or parcel of land situated in _________ County, North Carolina and more
particularly described as follows:

 

See Exhibit A attached hereto and by this reference made a part hereof.

 

The property hereinabove described was acquired by Grantor by Instrument
recorded in Deed Book _______, Page ________.

 

A map showing the above described property is recorded in ________, ________
County Registry.

 

TO HAVE AND TO HOLD the aforesaid lot or parcel of land and all privileges and
appurtenances thereto belonging to the Grantee in fee simple.

 

And the Grantor covenants with the Grantee, that Grantor has done nothing to
impair such title as Grantor received, and Grantor will warrant and defend the
title against the lawful claims of all persons claiming by, under or through
Grantor, except for the exceptions hereinafter stated.

 

Title to the property hereinabove described is subject to the following
exceptions:

 

See Exhibit B attached hereto

and incorporated herein by reference.

 

D - Page 11

 

 

IN WITNESS WHEREOF, the Grantor has hereunto set its hand and seal, the day and
year first above written.

 

  _______________________, a
_________________________       By:  _________________________  
Name:  _______________________   Title: _________________________

 

STATE OF _____________

 

COUNTY OF ___________

 

I, a Notary Public of the State aforesaid, certify that ___________________, the
__________________________ of ______________________________, Grantor,
personally appeared before me this day and acknowledged the due execution of the
foregoing instrument.

 

Witness my hand and official stamp or seal this ____ day of __________, 2013.

 

  ______________________________   Notary Public:

 

My commission expires: _____________________

________________________________________________________________________

 

The foregoing Certificate(s) of ____________________________________________

 

 

 

 

IS/ARE CERTIFIED TO BE CORRECT. THIS INSTRUMENT AND THIS CERTIFICATE ARE DULY
REGISTERED AT THE DATE AND TIME AND IN THE BOOK AND PAGE SHOWN ON THE FIRST PAGE
HEREOF.

 

_____________________ REGISTER OF DEEDS FOR _____________________County

 

By _____________________________ Deputy/Assistant - Register of Deeds

 

D - Page 12

 

 

Exhibit A

Legal Description

 

(attached hereto)

 

D - Page 13

 

 

Exhibit B

Permitted Exceptions

 

[list to be completed]

 

D - Page 14

 

 

TENNESSEE:

 

THIS INSTRUMENT WAS PREPARED
BY AND UPON RECORDING RETURN
TO:       _________________   _________________   _________________  
_________________   Attention: _____________      

 

SPECIAL WARRANTY DEED

 

THIS INDENTURE, made as of _________________, 2013 , between
____________________, a ____________________ (herein called “Grantor”), and
_______________________, a _______________________ (herein called “Grantee”).

 

WITNESSETH: That Grantor, for and in consideration of the sum of Ten Dollars
($10.00) and other good and valuable consideration, in hand paid at and before
the sealing and delivery of these presents, the receipt and sufficiency of which
are hereby acknowledged, has granted, bargained, sold, aliened, conveyed and
confirmed and by these presents does grant, bargain, sell, alien, convey and
confirm unto Grantee all that tract or parcel of land described in Exhibit A,
attached hereto and made a part hereof.

 

TO HAVE AND TO HOLD the said bargained premises, together with all and singular
the rights, members and appurtenances thereof, to the same being, belonging or
in any wise appertaining, to the only proper use, benefit and behoof of Grantee,
forever, IN FEE SIMPLE.

 

This Deed and the warranty of title contained herein are made expressly subject
to the items set forth in Exhibit B attached hereto and made a part hereof.

 

Grantor will warrant and forever defend the right and title to the above
described property unto Grantee against the lawful claims of all persons owning,
holding or claiming by, through or under Grantor, but not otherwise.

 

(The words “Grantor” and “Grantee” include all genders, plural and singular, and
their respective heirs, successors and assigns where the context requires or
permits.)

 

IN WITNESS WHEREOF, Grantor has signed and sealed this deed, the day and year
first above written.

 

  ____________________,   a ____________________       By:
______________________________   Name: ____________________]   Title:    

 

D - Page 15

 

 

STATE OF ____________ )     ) SS: COUNTY OF _________ )  

 

Before me, the undersigned, a Notary Public in and for the State and County
aforesaid, personally appeared ____________________, with whom I am personally
acquainted, and who, upon oath, acknowledged himself to be the
__________________ of ____________________, a ____________________, on behalf of
said ________________ as the ___________________ thereof, , and that he, as such
officer, being authorized so to do, executed the foregoing instrument for the
purposes therein contained, by signing the name of the company by himself as
such officer.

 

WITNESS my hand, at office in ______________________, this ____ day of
_________________, 2013.

 

        Notary Public, State of ____________     Printed Name
___________________     My Commission Expires:  __________  

 

    (Notarial Seal)         Sales Tax $__________   Register’s Fee $__________  
Recording Fee $__________   Total $__________

 

STATE OF ____________ )     )   COUNTY OF __________ )  

 

The actual consideration or value, whichever is greater, for this transfer is
_______________________ and No/100 Dollars ($_______________).

 

      AFFIANT

 

Subscribed and sworn to before me, this ____ day of ___________, 2013.

 

    NOTARY PUBLIC       My commission Expires:               (NOTARY SEAL)  

 

D - Page 16

 

 

Exhibit A

Legal Description

 

(attached hereto)

 

D - Page 17

 

 

Exhibit B

Permitted Exceptions

 

[list to be completed]

 

D - Page 18

 

 

EXHIBIT E

 

Form of Bill of Sale

 

[One Per Facility]

 

BILL OF SALE

 

THIS BILL OF SALE (“Bill of Sale”), is made as of the later to occur of
_______________, 2013, by and between ___________________________, a
______________________ (“Seller”) and _________________, a
_______________________ (“Buyer”).

 

WHEREAS, pursuant to the terms of that certain Purchase and Sale Agreement,
dated as of __________, 2013, by and between __________________ and Seller (the
“Sale Agreement”), Seller agreed to sell to Buyer, inter alia, certain real
property, the improvements located thereon and certain rights appurtenant
thereto, all as more particularly described in the Sale Agreement (collectively,
the “Real Property”) as more particularly described in Exhibit A attached
thereto and incorporated herein by this reference, known as
_______________________, ____________ County, __________; and

 

WHEREAS, by deed of even date herewith, Seller conveyed the Real Property to
Buyer and by assignment of even date herewith Seller assigned to Buyer Seller’s
rights under certain leases relating to the Real Property, as more particularly
described in such assignment (collectively, the “Leases”); and

 

WHEREAS, in connection with the above described conveyance Seller desires to
sell, transfer and convey to Buyer certain items of tangible personal property
as hereinafter described.

 

NOW, THEREFORE, in consideration of the receipt of TEN AND NO/100 DOLLARS
($10.00) and other good and valuable consideration paid in hand by Buyer to
Seller, the receipt and sufficiency of which are hereby acknowledged, Seller has
GRANTED, CONVEYED, SOLD, TRANSFERRED, SET OVER and DELIVERED and by these
presents does hereby GRANT, SELL, TRANSFER, SET OVER and DELIVER to Buyer, its
legal representatives, successors and assigns, and Buyer hereby accepts all
right, title and interest in and to (a) all tangible personal property owned by
Seller that is located on the Real Property and used in the ownership, operation
and maintenance of the Real Property, and (b) all books, records and files of
Seller relating to the Real Property and the Leases, but specifically excluding
therefrom the items described as Confidential Materials (as such term is defined
in the Sale Agreement) and any computer software that is licensed to Seller
(herein collectively called the “Personal Property”).

 

E - Page 1

 

 

Reference is made to that certain As-Is Certificate and Agreement, bearing even
date herewith, executed by Buyer for the benefit of Seller (the “As-Is
Certificate”), pursuant to which Buyer has (a) agreed to certain limitations on
representations, warranties, and liabilities of Seller; (b) waived and released
certain rights and claims against Seller and certain of its affiliates; and
(c) agreed to assume and indemnify Seller and certain of its affiliates from and
against certain Assumed Liabilities (as defined in the As-Is Certificate)
relating to, arising out of or otherwise attributable to the Property (as
defined in the Sale Agreement), including the Personal Property. The As-Is
Certificate is binding upon Buyer and its successors and assigns, including
successor owners of the Personal Property.

 

This Bill of Sale is made without any covenant, warranty or representation by,
or recourse against, Seller, as more expressly set forth in the Sale Agreement
and the documents executed in connection therewith.

 

This Bill of Sale may be executed in counterparts, each of which shall be an
original and all of which counterparts taken together shall constitute one and
the same agreement.

 

If any term or provision of this Bill of Sale or the application thereof to any
persons or circumstances shall, to any extent, be invalid or unenforceable, the
remainder of this Bill of Sale or the application of such term or provision to
persons or circumstances other than those as to which it is held invalid or
unenforceable shall not be affected thereby, and each term and provision of this
Bill of Sale shall be valid and enforced to the fullest extent permitted by law.

 

IN WITNESS WHEREOF, the undersigned have executed this Bill of Sale as of the
date first set forth hereinabove.

 

  SELLER:       __________________________________, a
_______________________       By: _________________________   Name:
___________________   Title: ____________________

 

E - Page 2

 

 

  ACCEPTED:       _______________________________,   a _______________________  
    By: _________________________   Name: ___________________   Title:
____________________

  

E - Page 3

 

 

EXHIBIT F

 

Form of Assignment of Tenant Leases

 

ASSIGNMENT AND ASSUMPTION OF SPACE LEASES

 

THIS ASSIGNMENT AND ASSUMPTION OF SPACE LEASES (this “Assignment”), is made as
of _______________, 2013, by and between __________________________, a
__________________________ (“Assignor”) and _____________________________, a
_______________________ (“Assignee”).

 

WITNESSETH:

 

WHEREAS, pursuant to the terms of that certain Purchase and Sale Agreement,
dated as of _____________, 2013, by and between Assignor and
______________________ (the “Sale Agreement”), Assignor agreed to sell to
Assignee, inter alia, certain real property, the improvements located thereon
and certain rights appurtenant thereto, all as more particularly described in
the Sale Agreement (collectively, the “Real Property”), known as
____________________________, _______________ County, ______________. Initially
capitalized terms not otherwise defined herein shall have the respective
meanings ascribed to such terms in the Sale Agreement; and

 

WHEREAS, the Sale Agreement provides, inter alia, that Assignor shall assign to
Assignee certain leases and that Assignor and Assignee shall enter into this
Assignment.

 

NOW, THEREFORE, in consideration of the premises and the mutual covenants herein
contained, the parties hereto hereby agree as follows:

 

1.          Assignment. Assignor hereby assigns, sets over and transfers to
Assignee all of Assignor’s right, title and interest in, to and under the space
leases (“Leases”) with the tenants of the Real Property identified on Exhibit A
attached hereto and incorporated herein by this reference. Assignee hereby
accepts the foregoing assignment of the Leases.

 

2.          As-Is Certificate. Reference is made to that certain As-Is
Certificate and Agreement, bearing even date herewith, executed by Assignee for
the benefit of Assignor (the “As-Is Certificate”), pursuant to which Assignee
has (a) agreed to certain limitations on representations, warranties, and
liabilities of Assignor; (b) waived and released certain rights and claims
against Assignor and certain of its affiliates; and (c) agreed to assume and
indemnify Assignor and certain of its affiliates from and against certain
Assumed Liabilities (as defined in the As-Is Certificate) relating to, arising
out of or otherwise attributable to the Property, including the Leases. The
As-Is Certificate is binding upon Assignee and its successors and assigns,
including successor owners of an interest in the Leases.

 

F - Page 1

 

 

3.          Miscellaneous. This Assignment and the obligations of the parties
hereunder shall survive the closing of the transaction referred to in the Sale
Agreement and shall not be merged therein, shall be binding upon and inure to
the benefit of the parties hereto, their respective legal representatives,
successors and assigns, shall be governed by and construed in accordance with
the laws of the State of _______ applicable to agreements made and to be wholly
performed within said State and may not be modified or amended in any manner
other than by a written agreement signed by the party to be charged therewith.

 

4.          Severability. If any term or provision of this Assignment or the
application thereof to any persons or circumstances shall, to any extent, be
invalid or unenforceable, the remainder of this Assignment or the application of
such term or provision to persons or circumstances other than those as to which
it is held invalid or unenforceable shall not be affected thereby, and each term
and provision of this Assignment shall be valid and enforced to the fullest
extent permitted by law.

 

5.          Counterparts. This Assignment may be executed in counterparts, each
of which shall be an original and all of which counterparts taken together shall
constitute one and the same agreement.

 

IN WITNESS WHEREOF, the undersigned have executed this Assignment as of the date
first set forth hereinabove.

 

  ASSIGNOR:       __________________________________, a
_______________________       By: _________________________   Name:
___________________   Title: ____________________

 

F - Page 2

 

 

  ASSIGNEE:       __________________________________, a
_______________________       By: _________________________   Name:
___________________   Title: ____________________

 

F - Page 3

 

 

EXHIBIT A

 

List of Tenants 

 

F - Page 4

 

 

EXHIBIT G

 

Form of Assignment of Intangible Property

 

ASSIGNMENT OF INTANGIBLE PROPERTY

 

THIS ASSIGNMENT OF INTANGIBLE PROPERTY (this “Assignment”), is made as of
__________________, 2013, by and between____________________________, a
_______________________ (“Assignor”) and _______________________________, a
_______________________ (“Assignee”).

 

WITNESSETH:

 

WHEREAS, pursuant to the terms of that certain Purchase and Sale Agreement,
dated as of ________________, 2013, by and between Assignor and
________________________ (the “Sale Agreement”), Assignor agreed to sell to
Assignee, inter alia, certain real property, the improvements located thereon
and certain rights appurtenant thereto, all as more particularly described in
the Sale Agreement (collectively, the “Real Property”), known as
______________________, __________ County, _____________. Initially capitalized
terms not otherwise defined herein shall have the respective meanings ascribed
to such terms in the Sale Agreement; and

 

WHEREAS, the Sale Agreement provides, inter alia, that Assignor shall assign to
Assignee rights to certain intangible property and that Assignor and Assignee
shall enter into this Assignment.

 

NOW, THEREFORE, in consideration of the premises and the mutual covenants herein
contained, the parties hereto hereby agree as follows:

 

1.          Assignment of Contracts, Licenses and Permits. Assignor hereby
assigns, sets over and transfers to Assignee all of Assignor’s right, title and
interest in, to and under the following, if and only to the extent the same may
be assigned or quitclaimed by Assignor without expense to Assignor:

 

(a)all service, supply, maintenance, utility and commission agreements, all
equipment leases, and all other contracts, subcontracts and agreements relating
to the Real Property and the Personal Property (including all contracts,
subcontracts and agreements relating to the construction of any unfinished
tenant improvements), all of which are described in Exhibit A attached hereto
and incorporated herein by this reference (herein collectively called the
“Contracts”); and

 

(b)to the extent that the same are in effect as of the date hereof, any
licenses, permits and other written authorizations necessary for the use,
operation or ownership of the Real Property (herein collectively called the
“Licenses and Permits”); and

 

G - Page 1

 

 

 

(c)the rights of Assignor (if any) to the name “The Remington at Valley Ranch”
(it being acknowledged by Assignee that Assignor does not have exclusive rights
(and in fact may have no rights) to use such name and Assignor has not
registered the same in any manner); and

 

(d)any guaranties and warranties in effect with respect to any portion of the
Real Property or the Personal Property as of the date hereof.

 

Assignee hereby accepts the foregoing assignment of the interests described in
this Section 1.

 

2.          As-Is Certificate. Reference is made to that certain As-Is
Certificate and Agreement, bearing even date herewith, executed by Assignee for
the benefit of Assignor (the “As-Is Certificate”), pursuant to which Assignee
has (a) agreed to certain limitations on representations, warranties, and
liabilities of Assignor; (b) waived and released certain rights and claims
against Assignor and certain of its affiliates; and (c) agreed to assume and
indemnify Assignor and certain of its affiliates from and against certain
Assumed Liabilities (as defined in the As-Is Certificate) relating to, arising
out of or otherwise attributable to the Property, including the Contracts and
the Licenses and Permits. The As-Is Certificate is binding upon Assignee and its
successors and assigns, including successor owners of an interest in the
Contracts and the Licenses and Permits.

 

3.          Miscellaneous. This Assignment and the obligations of the parties
hereunder shall survive the closing of the transaction referred to in the Sale
Agreement and shall not be merged therein, shall be binding upon and inure to
the benefit of the parties hereto, their respective legal representatives,
successors and assigns, shall be governed by and construed in accordance with
the laws of the State of _________ applicable to agreements made and to be
wholly performed within said State and may not be modified or amended in any
manner other than by a written agreement signed by the party to be charged
therewith.

 

4.          Severability. If any term or provision of this Assignment or the
application thereof to any persons or circumstances shall, to any extent, be
invalid or unenforceable, the remainder of this Assignment or the application of
such term or provision to persons or circumstances other than those as to which
it is held invalid or unenforceable shall not be affected thereby, and each term
and provision of this Assignment shall be valid and enforced to the fullest
extent permitted by law.

 

5.          Counterparts. This Assignment may be executed in counterparts, each
of which shall be an original and all of which counterparts taken together shall
constitute one and the same agreement.

 

G - Page 2

 

 

IN WITNESS WHEREOF, the undersigned have executed this Assignment as of the date
first set forth hereinabove.

 

  ASSIGNOR:       __________________________________, a _______________________
      By: _________________________   Name: ___________________   Title:
____________________

 

G - Page 3

 

 

  ASSIGNEE:       __________________________________, a _______________________
      By: _________________________   Name: ___________________   Title:
____________________

 

G - Page 4

 

 

EXHIBIT A

 

List of Contracts

(service, supply, maintenance, utility and commission agreements,

and all equipment leases, and guaranties and warranties, if any) 

 

G - Page 5

 

 

EXHIBIT H

 

Form of Notice to Tenants

 

NOTICE OF SALE

(To Tenants, Regarding Assignment and Assumption of Space Leases)

 

TO: All Tenants of ___________________ _______________, 2013  
________________________     ________________________  

 

RE: Notice of Change of Ownership of __________________, __________County,
_________

 

To Whom It May Concern:

 

You are hereby notified as follows:

 

1.That as of the date hereof, ___________________ has transferred, sold,
assigned, and conveyed all of its interest in and to the above-described
property (the “Property”) to ____________________________, a
_______________________] (the “New Owner”).

 

2.Future notices and rental payments with respect to your leased premises at the
Property should be made to the New Owner in accordance with your Lease terms at
the following address:

 

  _______________________   _______________________   _______________________

 

3.If there is a security deposit with respect to your lease, it has been
transferred to the New Owner and as such the New Owner shall be responsible for
holding the same in accordance with the terms of your lease.

 

H - Page 1

 

 

  __________________________________, a _______________________       By:
_________________________   Name: ___________________   Title:
____________________

 

H - Page 2

 

 

  __________________________________, a _______________________       By:
_________________________   Name: ___________________   Title:
____________________

 

 

H - Page 3

 

 

EXHIBIT I

 

Form of Seller’s Non-Foreign Certificate

 

NON-Foreign Certificate

 

Section 1445 of the Internal Revenue Code provides that a transferee of a United
States real property interest must withhold tax if the transferor is a foreign
person. For U.S. tax purposes (including Section 1445), the owner of a
disregarded entity (which has legal title to a U.S. real property interest under
local law) will be the transferor of the property and not the disregarded
entity. To inform [Purchaser Assignee, a _______________________] (the
“Transferee”) that withholding of tax is not required upon the disposition of a
United States real property interest by _________________________, a
__________________________ (the “Seller”), the undersigned hereby certifies the
following on behalf of Seller:

 

1.Seller is not a foreign corporation, foreign partnership, foreign trust, or
foreign estate (as those terms are defined in the Internal Revenue Code and
Income Tax Regulations); and

 

2.Seller is not a disregarded entity as defined in Section 1.1445-2(b)(2)(iii)
of the Income Tax Regulations issued under the Internal Revenue Code.

 

3.Seller's U.S. employer tax identification number is ______________________;
and

 

4.Seller's office address is c/o Prudential Real Estate Investors, 3348
Peachtree Road, Suite 1100, Atlanta, Georgia 30326

 

Seller understands that this certification may be disclosed to the Internal
Revenue Service by transferee and that any false statement contained herein
could be punished by fine, imprisonment, or both.

 

I - Page 1

 

 

The undersigned declares that the undersigned has examined this certification
and to the best of the undersigned’s knowledge and belief it is true, correct
and complete, and the undersigned further declares that such party has authority
to sign this document on behalf of Seller.

 

Certified, sworn to and subscribed
before me this ___ day of ____________, 2013.
__________________________________, a
_______________________     ________________________ By:
_________________________ Notary Public Name: ___________________   Title:
____________________ My Commission Expires:       ________________________      
 (NOTARIAL SEAL)  

 

 

I - Page 2

 

 

EXHIBIT J

 

Form of Seller’s Title Affidavit

 

TITLE AFFIDAVIT

 

STATE OF GEORGIA )   )  SS. COUNTY OF FULTON )

 

PERSONALLY APPEARED before me the undersigned officer, duly authorized to
administer oaths, John W. Dark (the “Affiant”), who being duly sworn according
to law, deposes and says an oath as follows:

 

1.          Affiant is the duly appointed and acting Vice President of
Prudential Investment Management, Inc., a New Jersey corporation, which is the
Managing Member of Senior Housing Partners III, L.L.C, a Delaware limited
liability company, which is the General Partner of Senior Housing Partners III,
L.P., a Delaware limited partnership, which is the Sole Member of
______________________, LLC, a _________________ limited liability company
(“Owner”), and in the foregoing capacity, has personal knowledge of the facts
sworn to in this Affidavit, and is fully authorized and qualified on behalf of
Owner to make this Affidavit.

 

2.          Owner’s address is _______________________________________.

 

3.          Owner’s U.S. employer taxpayer identification number is
_____________.

 

4.          Owner is the owner of that certain tract or parcel of land located
in _____________ County, _____________ (the “Property”), described in Stewart
Title Guaranty Company’s (the “Title Company”) Commitment for Title Insurance
No. ________________ (the “Commitment”).

 

5.          There are no unpaid taxes, special assessments or assessments of any
nature, against said Property, and Owner has no knowledge or notice of any plans
for imposition of a future assessment.

 

6.          Except for residents of the senior living community operated at the
Property, there are no unrecorded tenancies, leases, tenants or other
occupancies on the Property.

 

7.          To Affiant’s actual knowledge, there are no pending suits,
proceedings, judgments, bankruptcies, liens or executions against the Property
or Owner in ___________ County, _____________, which in any way affect the title
to the Property.

 

8.          To Affiant’s actual knowledge, there are no unpaid bills incurred by
Owner for work performed or materials delivered to the Property for the
construction or improvement of said Property during the past _____________
(____) days immediately preceding this date.

 

J - Page 1

 

 

9.          To Affiant’s actual knowledge, there are no matters pending by or
against Owner that could give rise to a lien that could attach to the Property
between the date of the issuance of the Commitment (the “Last Certification
Date”) and the date of the Closing between Owner and ______________________ (the
“Buyer”). Following the Last Certification Date, Owner has not executed, and
will not execute, any instrument that would adversely affect the title to the
Property except as contained in the Commitment. Owner will indemnify and hold
Buyer and the Title Company harmless from all liens or title defects created by
or against Owner subsequent to the Last Certification Date and prior to Closing
as a result of a breach of the foregoing covenant by Owner.

 

10.         This Affidavit is given to induce the Title Company to issue its
policy of title insurance knowing full well that it will be relying upon the
accuracy of the same.

 

[SIGNATURES APPEAR ON FOLLOWING PAGE]

 

J - Page 2

 

 

  Affiant:     Certified, sworn to and ___________________________ (Seal)
subscribed before me this John W. Dark, solely in his capacity as Vice _____ day
of _________, 2013. President aforesaid     ________________________   Notary
Public       My Commission Expires:       ________________________      
(NOTARIAL SEAL)  

  

J - Page 3

 

 

EXHIBIT K

 

LITIGATION NOTICES, CONTRACT DEFAULTS

GOVERNMENTAL VIOLATIONS

 

1)Seller has received written notice of a threatened litigation from resident
Frederick Chesson with respect to the Arbor Terrace at Cascade Property.

 

2)Seller is a party to the following pending litigation with respect to the
Barrington Terrace at Ft. Myers Property: 11-CA-004011 (Lee County Circuit
Court), filed by Estate of Walter Shoemaker, as Plaintiff.

 

3)Seller has received written notice of certain citations with respect to a
routine survey/inspection by the applicable licensing authority for the
Barrington Terrace at Ft. Myers Property. Seller has taken action to cure such
citations, however, no formal acceptance or approval of such cure has been
received from the licensing authority.

 

4)Seller has received written notice of a threatened litigation from resident
Diane Estes with respect to the Barrington Terrace at Naples Property.

 

5)Seller has received notice of an EEOC claim from Sylvia Martinez with respect
to the Barrington Terrace at Naples Property.

 

 

K - Page 1

 

 

EXHIBIT L

 

LISTS OF TENANTS

 

(attached hereto) 

 

L - Page 1

 

 

EXHIBIT M

 

LIST OF LICENSES HELD

 

Arbor Terrace of Asheville

 

License Name: State of North Carolina Department of Health and Human Services
Division of Health Service Regulation. Licensed Adult Care Home

 

License Number: HAL-011-224

 

Arbor Terrace of Athens

 

License Name: Georgia Department of Community Health; Personal Care Home Permit
- Healthcare Facility Regulation Division

 

License (Permit) Number: 029-03-003-1

 

Arbor Terrace of Cascade

 

License Name: Georgia Department of Human Resources; Personal Care Home Permit

 

License (Permit) Number: 060-03-046-1

 

Arbor Terrace of Decatur

 

License Name: Georgia Department of Human Resources; Personal Care Home Permit

 

License (Permit) Number: 044-03-015-1

 

Barrington Terrace of Fort Myers

 

License Name: Florida Agency for Health Care Administration; Division of Health
Quality Assurance. Standard Assisted Living Facility (with Extended Congregate
Care)

 

License Number: AL10100

 

Arbor Terrace of Knoxville

 

License Name: Tennessee Board for Licensing Health Care Facilities; Department
of Health. Assisted Care Living Facility.

 

License Number: ACL0000000018

 

Arbor Terrace of Largo

 

License Name: Florida Agency for Health Care Administration; Division of Health
Quality Assurance. Standard Assisted Living Facility

 

License Number: AL7933

 

M - Page 1

 

 

Barrington Terrace of Naples 

 

License Name: Florida Agency for Health Care Administration; Division of Health
Quality Assurance. Standard Assisted Living Facility

 

License Number: AL10447 

 

M - Page 2

 

 

EXHIBIT N

 

GOVERNMENTAL PAYOR PROGRAMS

 

Arbor Terrace Largo

 

Amerigroup Florida Inc. Long Term Care Diversion Program. Federal Tax
Identification EIN#20-4504921.

Amerigroup provider billing ID #01089407.

 

Barrington Terrace Fort Myers

 

Area Agency on Aging for Southwest Florida, Inc. dba Senior Choices of Southwest
Florida Medicaid Waiver Program. Federal Tax Identification #EIN20-4021236

State Medicaid provider number #692481600

 

American Eldercare, Inc. Long Term Care Diversion Program. Federal Tax
Identification EIN# 20-4021236

No distinct provider number outside of federal Tax ID and state Medicaid
provider number

 

Hope Health Care Services Long Term Care Community Diversion Program.

No distinct provider number outside of federal Tax ID and state Medicaid
provider number

 

Barrington Terrace Naples

 

Hope Hospice & Community Services Long Term Care Community Diversion Program.

No provider number outside of Federal Tax ID 

 

N - Page 1

 

 

SCHEDULE 1

 

ALLOCATION OF PURCHASE PRICE

 

Asheville   63    18,657,235  Athens   56    20,268,357  Cascade   68  
 10,026,927  Decatur   66    23,551,960  Fort Myers   117    18,030,311 
Knoxville   84    17,188,004  Largo   66    9,239,620  Naples   120  
 24,287,586  Land   0    1,750,000  Totals/Averages   640    143,000,000 

 

Schedule 1 - Page 1