Exhibit 10.1

 

AMENDED AND RESTATED MASTER LEASE AGREEMENT
(LEASE NO. 1),

 

dated as of June 30, 2008,

 

by and among

 

CERTAIN AFFILIATES OF SENIOR HOUSING PROPERTIES TRUST,

 

AS LANDLORD,

 

AND

 

FIVE STAR QUALITY CARE TRUST,

 

AS TENANT

 

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ARTICLE 1

 

DEFINITIONS

 

1

1.1

 

“Additional Charges”

 

1

1.2

 

“Additional Rent”

 

2

1.3

 

“Affiliated Person”

 

2

1.4

 

“Agreement”

 

2

1.5

 

“Applicable Laws”

 

2

1.6

 

“Award”

 

3

1.7

 

“Base Gross Revenues”

 

3

1.8

 

“Base Year”

 

3

1.9

 

“Business Day”

 

3

1.10

 

“Capital Addition”

 

3

1.11

 

“Capital Expenditure”

 

4

1.12

 

“Change in Control”

 

4

1.13

 

“Claim”

 

4

1.14

 

“Code”

 

4

1.15

 

“Commencement Date”

 

4

1.16

 

“Condemnation”

 

5

1.17

 

“Condemnor”

 

5

1.18

 

“Consolidated Financials”

 

5

1.19

 

“Date of Taking”

 

5

1.20

 

“Default”

 

5

1.21

 

“Disbursement Rate”

 

5

1.22

 

“Distribution”

 

5

1.23

 

“Easement Agreement”

 

6

1.24

 

“Encumbrance”

 

6

1.25

 

“Entity”

 

6

1.26

 

“Environment”

 

6

1.27

 

“Environmental Obligation”

 

6

1.28

 

“Environmental Notice”

 

6

1.29

 

“Event of Default”

 

6

1.30

 

“Excess Gross Revenues”

 

6

1.31

 

“Extended Term”

 

6

1.32

 

“Facility”

 

6

1.33

 

“Facility Mortgage”

 

6

1.34

 

“Facility Mortgagee”

 

7

1.35

 

“Financial Officer’s Certificate”

 

7

1.36

 

“Fiscal Year”

 

7

1.37

 

“Five Star”

 

7

1.38

 

“Fixed Term”

 

7

1.39

 

“Fixtures”

 

7

1.40

 

“GAAP”

 

7

1.41

 

“Government Agencies”

 

7

1.42

 

“Gross Revenues”

 

7

1.43

 

“Guarantor”

 

9

1.44

 

“Guaranty”

 

9

1.45

 

“Hazardous Substances”

 

9

1.46

 

“Immediate Family”

 

10

1.47

 

“Impositions”

 

10

1.48

 

“Incidental Documents”

 

11

1.49

 

“Indebtedness”

 

11

1.50

 

“Insurance Requirements”

 

11

1.51

 

“Interest Rate”

 

11

1.52

 

“LTA GMAC Leased Property”

 

11

 

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1.53

 

“LTA GMAC Leases”

 

11

1.54

 

“LTA GMAC Property”

 

12

1.55

 

“Land”

 

12

1.56

 

“Landlord”

 

12

1.57

 

“Landlord Default”

 

12

1.58

 

“Landlord Liens”

 

12

1.59

 

“Lease Year”

 

12

1.60

 

“Leased Improvements”

 

12

1.61

 

“Leased Intangible Property”

 

12

1.62

 

“Leased Property”

 

13

1.63

 

“Legal Requirements”

 

13

1.64

 

“Lien”

 

13

1.65

 

“Manager”

 

13

1.66

 

“Management Agreement”

 

13

1.67

 

“Master Lease Agreement No. 3”

 

13

1.68

 

“Minimum Rent”

 

14

1.69

 

“Notice”

 

14

1.70

 

“Officer’s Certificate”

 

14

1.71

 

“Original Lease”

 

14

1.72

 

“Overdue Rate”

 

14

1.73

 

“Parent”

 

14

1.74

 

“Permitted Encumbrances”

 

14

1.75

 

“Permitted Liens”

 

14

1.76

 

“Permitted Use”

 

14

1.77

 

“Person”

 

14

1.78

 

“Pledge Agreement”

 

15

1.79

 

“Property”

 

15

1.80

 

“Provider Agreements”

 

15

1.81

 

“Records”

 

15

1.82

 

“Regulated Medical Wastes”

 

15

1.83

 

“Rent”

 

15

1.84

 

“SEC”

 

15

1.85

 

“Security Agreement”

 

15

1.86

 

“State”

 

15

1.87

 

“Subordinated Creditor”

 

15

1.88

 

“Subordination Agreement”

 

15

1.89

 

“Subsidiary”

 

16

1.90

 

“Successor Landlord”

 

16

1.91

 

“Tenant”

 

16

1.92

 

“Tenant’s Personal Property”

 

16

1.93

 

“Term”

 

16

1.94

 

“Third Party Payor Programs”

 

16

1.95

 

“Third Party Payors”

 

16

1.96

 

“Unsuitable for Its Permitted Use”

 

16

1.97

 

“Work”

 

17

ARTICLE 2

 

LEASED PROPERTY AND TERM

 

17

2.1

 

Leased Property

 

17

2.2

 

Condition of Leased Property

 

18

2.3

 

Fixed Term

 

19

2.4

 

Extended Terms

 

19

ARTICLE 3

 

RENT

 

20

3.1

 

Rent

 

20

 

2

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3.2

 

Late Payment of Rent, Etc.

 

26

3.3

 

Net Lease

 

26

3.4

 

No Termination, Abatement, Etc.

 

26

ARTICLE 4

 

USE OF THE LEASED PROPERTY

 

27

4.1

 

Permitted Use

 

27

4.2

 

Compliance with Legal/Insurance Requirements, Etc.

 

29

4.3

 

Compliance with Medicaid and Medicare Requirements

 

30

4.4

 

Environmental Matters

 

30

ARTICLE 5

 

MAINTENANCE AND REPAIRS

 

32

5.1

 

Maintenance and Repair

 

32

5.2

 

Tenant’s Personal Property

 

34

5.3

 

Yield Up

 

34

5.4

 

Management Agreement

 

35

ARTICLE 6

 

IMPROVEMENTS, ETC.

 

36

6.1

 

Improvements to the Leased Property

 

36

6.2

 

Salvage

 

36

ARTICLE 7

 

LIENS

 

37

7.1

 

Liens

 

37

7.2

 

Landlord’s Lien

 

37

ARTICLE 8

 

PERMITTED CONTESTS

 

38

ARTICLE 9

 

INSURANCE AND INDEMNIFICATION

 

39

9.1

 

General Insurance Requirements

 

39

9.2

 

Waiver of Subrogation

 

39

9.3

 

Form Satisfactory, Etc.

 

39

9.4

 

No Separate Insurance; Self-Insurance

 

40

9.5

 

Indemnification of Landlord

 

41

ARTICLE 10

 

CASUALTY

 

41

10.1

 

Insurance Proceeds

 

41

10.2

 

Damage or Destruction

 

42

10.3

 

Damage Near End of Term

 

44

10.4

 

Tenant’s Property

 

44

10.5

 

Restoration of Tenant’s Property

 

44

10.6

 

No Abatement of Rent

 

45

10.7

 

Waiver

 

45

ARTICLE 11

 

CONDEMNATION

 

45

11.1

 

Total Condemnation, Etc.

 

45

11.2

 

Partial Condemnation

 

45

11.3

 

Abatement of Rent

 

46

11.4

 

Temporary Condemnation

 

47

11.5

 

Allocation of Award

 

47

ARTICLE 12

 

DEFAULTS AND REMEDIES

 

48

12.1

 

Events of Default

 

48

12.2

 

Remedies

 

50

12.3

 

Tenant’s Waiver

 

52

12.4

 

Application of Funds

 

52

12.5

 

Landlord’s Right to Cure Tenant’s Default

 

52

 

3

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ARTICLE 13

 

HOLDING OVER

 

53

ARTICLE 14

 

LANDLORD DEFAULT

 

53

ARTICLE 15

 

PURCHASE RIGHTS

 

54

ARTICLE 16

 

SUBLETTING AND ASSIGNMENT

 

54

16.1

 

Subletting and Assignment

 

54

16.2

 

Required Sublease Provisions

 

56

16.3

 

Permitted Sublease

 

57

16.4

 

Sublease Limitation

 

58

ARTICLE 17

 

ESTOPPEL CERTIFICATES AND FINANCIAL STATEMENTS

 

58

17.1

 

Estoppel Certificates

 

58

17.2

 

Financial Statements

 

59

17.3

 

General Operations

 

60

ARTICLE 18

 

LANDLORD’S RIGHT TO INSPECT

 

61

ARTICLE 19

 

EASEMENTS

 

61

19.1

 

Grant of Easements

 

61

19.2

 

Exercise of Rights by Tenant

 

62

19.3

 

Permitted Encumbrances

 

62

ARTICLE 20

 

FACILITY MORTGAGES

 

62

20.1

 

Landlord May Grant Liens

 

62

20.2

 

Subordination of Lease

 

62

20.3

 

Notice to Mortgagee and Superior Landlord

 

64

ARTICLE 21

 

ADDITIONAL COVENANTS OF TENANT

 

64

21.1

 

Prompt Payment of Indebtedness

 

64

21.2

 

Conduct of Business

 

65

21.3

 

Maintenance of Accounts and Records

 

65

21.4

 

Notice of Litigation, Etc.

 

65

21.5

 

Indebtedness of Tenant

 

66

21.6

 

Distributions, Payments to Affiliated Persons, Etc.

 

67

21.7

 

Prohibited Transactions

 

67

21.8

 

Liens and Encumbrances

 

67

21.9

 

Merger; Sale of Assets; Etc.

 

68

21.10

 

LTA GMAC Properties

 

68

ARTICLE 22

 

ARBITRATION

 

69

ARTICLE 23

 

MISCELLANEOUS

 

70

23.1

 

Limitation on Payment of Rent

 

70

23.2

 

No Waiver

 

70

23.3

 

Remedies Cumulative

 

70

23.4

 

Severability

 

71

23.5

 

Acceptance of Surrender

 

71

23.6

 

No Merger of Title

 

71

23.7

 

Conveyance by Landlord

 

71

23.8

 

Quiet Enjoyment

 

71

23.9

 

No Recordation

 

72

23.10

 

Notices

 

72

23.11

 

Construction

 

73

23.12

 

Counterparts; Headings

 

73

23.13

 

Applicable Law, Etc.

 

74

23.14

 

Right to Make Agreement

 

74

23.15

 

Attorneys’ Fees

 

74

23.16

 

Property Specific Representations and Warranties

 

75

 

4

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23.17

 

Nonliability of Trustees

 

76

23.18

 

Beverly Manor Allowance

 

77

23.19

 

Savannah Square Lease

 

77

23.20

 

Original Lease

 

77

 

5

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AMENDED AND RESTATED MASTER LEASE AGREEMENT
(LEASE NO. 1)

 

THIS AMENDED AND RESTATED MASTER LEASE AGREEMENT (LEASE NO. 1) is entered into
as of June 30, 2008 by and among each of the parties identified on the signature
page hereof as a landlord, as landlord (collectively, “Landlord”), and FIVE STAR
QUALITY CARE TRUST, a Maryland business trust, as tenant (“Tenant”).

 

W I T N E S S E T H :

 

WHEREAS, Landlord and Tenant are parties to that certain Second Amended and
Restated Lease Agreement, dated as of November 19, 2004, as the same has been
amended to date (as so amended, the “Original Lease”); and

 

WHEREAS, Landlord and Tenant wish to amend, restate and bifurcate the Original
Lease into two separate leases and to make such other modifications thereto as
are set forth herein;

 

NOW, THEREFORE, in consideration of the mutual covenants herein contained and
other good and valuable consideration, the mutual receipt and legal sufficiency
of which are hereby acknowledged, Landlord and Tenant hereby agree that,
effective as of the date hereof, the Original Lease is hereby amended and
restated with respect to the Leased Property (as hereinafter defined), as
follows:

 

ARTICLE 1

 

DEFINITIONS

 

For all purposes of this Agreement, except as otherwise expressly provided or
unless the context otherwise requires, (a) the terms defined in this
Article shall have the meanings assigned to them in this Article and include the
plural as well as the singular, (b) all accounting terms not otherwise defined
herein shall have the meanings assigned to them in accordance with GAAP, (c) all
references in this Agreement to designated “Articles”, “Sections” and other
subdivisions are to the designated Articles, Sections and other subdivisions of
this Agreement, and (d) the words “herein”, “hereof”, “hereunder” and other
words of similar import refer to this Agreement as a whole and not to any
particular Article, Section or other subdivision.

 

1.1          “ADDITIONAL CHARGES”  SHALL HAVE THE MEANING GIVEN SUCH TERM IN
SECTION 3.1.3.

 

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1.2          “ADDITIONAL RENT”  SHALL HAVE THE MEANING GIVEN SUCH TERM IN
SECTION 3.1.2(A).

 

1.3          “AFFILIATED PERSON”  SHALL MEAN, WITH RESPECT TO ANY PERSON, (A) 
IN THE CASE OF ANY SUCH PERSON WHICH IS A PARTNERSHIP, ANY PARTNER IN SUCH
PARTNERSHIP, (B) IN THE CASE OF ANY SUCH PERSON WHICH IS A LIMITED LIABILITY
COMPANY, ANY MEMBER OF SUCH COMPANY, (C) ANY OTHER PERSON WHICH IS A PARENT, A
SUBSIDIARY, OR A SUBSIDIARY OF A PARENT WITH RESPECT TO SUCH PERSON OR TO ONE OR
MORE OF THE PERSONS REFERRED TO IN THE PRECEDING CLAUSES (A) AND (B), (D) ANY
OTHER PERSON WHO IS AN OFFICER, DIRECTOR, TRUSTEE OR EMPLOYEE OF, OR PARTNER IN
OR MEMBER OF, SUCH PERSON OR ANY PERSON REFERRED TO IN THE PRECEDING CLAUSES
(A), (B) AND (C), AND (E) ANY OTHER PERSON WHO IS A MEMBER OF THE IMMEDIATE
FAMILY OF SUCH PERSON OR OF ANY PERSON REFERRED TO IN THE PRECEDING CLAUSES
(A) THROUGH (D).

 

1.4          “AGREEMENT”  SHALL MEAN THIS AMENDED AND RESTATED MASTER LEASE
AGREEMENT (LEASE NO. 1), INCLUDING ALL SCHEDULES AND EXHIBITS ATTACHED HERETO,
AS IT AND THEY MAY BE AMENDED FROM TIME TO TIME AS HEREIN PROVIDED.

 

1.5          “APPLICABLE LAWS”  SHALL MEAN ALL APPLICABLE LAWS, STATUTES,
REGULATIONS, RULES, ORDINANCES, CODES, LICENSES, PERMITS AND ORDERS, FROM TIME
TO TIME IN EXISTENCE, OF ALL COURTS OF COMPETENT JURISDICTION AND GOVERNMENT
AGENCIES, AND ALL APPLICABLE JUDICIAL AND ADMINISTRATIVE AND REGULATORY DECREES,
JUDGMENTS AND ORDERS, INCLUDING COMMON LAW RULINGS AND DETERMINATIONS, RELATING
TO INJURY TO, OR THE PROTECTION OF, REAL OR PERSONAL PROPERTY OR HUMAN HEALTH OR
THE ENVIRONMENT, INCLUDING, WITHOUT LIMITATION, ALL VALID AND LAWFUL
REQUIREMENTS OF COURTS AND OTHER GOVERNMENT AGENCIES PERTAINING TO REPORTING,
LICENSING, PERMITTING, INVESTIGATION, REMEDIATION AND REMOVAL OF UNDERGROUND
IMPROVEMENTS (INCLUDING, WITHOUT LIMITATION, TREATMENT OR STORAGE TANKS, OR
WATER, GAS OR OIL WELLS), OR EMISSIONS, DISCHARGES, RELEASES OR THREATENED
RELEASES OF HAZARDOUS SUBSTANCES, CHEMICAL SUBSTANCES, PESTICIDES, PETROLEUM OR
PETROLEUM PRODUCTS, POLLUTANTS, CONTAMINANTS OR HAZARDOUS OR TOXIC SUBSTANCES,
MATERIALS OR WASTES WHETHER SOLID, LIQUID OR GASEOUS IN NATURE, INTO THE
ENVIRONMENT, OR RELATING TO THE MANUFACTURE, PROCESSING, DISTRIBUTION, USE,
TREATMENT, STORAGE, DISPOSAL, TRANSPORT OR HANDLING OF HAZARDOUS SUBSTANCES OR
REGULATED MEDICAL WASTES, UNDERGROUND IMPROVEMENTS (INCLUDING, WITHOUT
LIMITATION, TREATMENT OR STORAGE TANKS, OR WATER, GAS OR OIL WELLS), OR
POLLUTANTS, CONTAMINANTS OR HAZARDOUS OR TOXIC SUBSTANCES, MATERIALS OR WASTES,
WHETHER SOLID, LIQUID OR GASEOUS IN NATURE.

 

2

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1.6          “AWARD”  SHALL MEAN ALL COMPENSATION, SUMS OR OTHER VALUE AWARDED,
PAID OR RECEIVED BY VIRTUE OF A TOTAL OR PARTIAL CONDEMNATION OF ANY PROPERTY
(AFTER DEDUCTION OF ALL REASONABLE LEGAL FEES AND OTHER REASONABLE COSTS AND
EXPENSES, INCLUDING, WITHOUT LIMITATION, EXPERT WITNESS FEES, INCURRED BY
LANDLORD, IN CONNECTION WITH OBTAINING ANY SUCH AWARD).

 

1.7          “BASE GROSS REVENUES”  SHALL MEAN THE AMOUNT OF GROSS REVENUES FOR
THE LEASED PROPERTY AND THE LTA GMAC LEASED PROPERTY FOR THE BASE YEAR,
PROVIDED, HOWEVER, THAT IN THE EVENT THAT, WITH RESPECT TO ANY LEASE YEAR, OR
PORTION THEREOF, FOR ANY REASON (INCLUDING, WITHOUT LIMITATION, A CASUALTY OR
CONDEMNATION) THERE SHALL BE A REDUCTION IN THE NUMBER OF UNITS AVAILABLE AT ANY
FACILITY LOCATED AT THE LEASED PROPERTY OR IN THE SERVICES PROVIDED AT SUCH
FACILITY FROM THE NUMBER OF SUCH UNITS OR THE SERVICES PROVIDED DURING THE BASE
YEAR, IN DETERMINING ADDITIONAL RENT PAYABLE FOR SUCH LEASE YEAR, BASE GROSS
REVENUES SHALL BE REDUCED AS FOLLOWS:  (A) IN THE EVENT OF THE TERMINATION OF
THIS AGREEMENT WITH RESPECT TO ANY PROPERTY PURSUANT TO ARTICLE 10, 11 OR 12,
ALL GROSS REVENUES FOR SUCH PROPERTY FOR THE PERIOD DURING THE BASE YEAR
EQUIVALENT TO THE PERIOD AFTER THE TERMINATION OF THIS AGREEMENT WITH RESPECT TO
SUCH PROPERTY SHALL BE SUBTRACTED FROM BASE GROSS REVENUES; (B) IN THE EVENT OF
A PARTIAL CLOSING OF ANY FACILITY AFFECTING THE NUMBER OF UNITS, OR THE SERVICES
PROVIDED, AT SUCH FACILITY, GROSS REVENUES ATTRIBUTABLE TO UNITS OR SERVICES AT
SUCH FACILITY SHALL BE RATABLY ALLOCATED AMONG ALL UNITS IN SERVICE AT SUCH
FACILITY DURING THE BASE YEAR AND ALL SUCH GROSS REVENUES ATTRIBUTABLE TO UNITS
NO LONGER IN SERVICE SHALL BE SUBTRACTED FROM BASE GROSS REVENUES THROUGHOUT THE
PERIOD OF SUCH CLOSING; AND (C) IN THE EVENT OF ANY OTHER CHANGE IN
CIRCUMSTANCES AFFECTING ANY FACILITY, BASE GROSS REVENUES SHALL BE EQUITABLY
ADJUSTED IN SUCH MANNER AS LANDLORD AND TENANT SHALL REASONABLY AGREE.

 

1.8          “BASE YEAR”  SHALL MEAN, WITH RESPECT TO EACH PROPERTY, THE
CALENDAR YEAR SPECIFIED AS THE BASE YEAR WITH RESPECT TO SUCH PROPERTY ON
SCHEDULE 1 ATTACHED HERETO AND MADE A PART HEREOF AND, WITH RESPECT TO EACH LTA
GMAC PROPERTY, THE 2006 CALENDAR YEAR.

 

1.9          “BUSINESS DAY”  SHALL MEAN ANY DAY OTHER THAN SATURDAY, SUNDAY, OR
ANY OTHER DAY ON WHICH BANKING INSTITUTIONS IN THE COMMONWEALTH OF MASSACHUSETTS
ARE AUTHORIZED BY LAW OR EXECUTIVE ACTION TO CLOSE.

 

1.10        “CAPITAL ADDITION”  SHALL MEAN, WITH RESPECT TO ANY PROPERTY, ANY
RENOVATION, REPAIR OR IMPROVEMENT TO SUCH PROPERTY, THE COST OF WHICH
CONSTITUTES A CAPITAL EXPENDITURE.

 

3

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1.11        “CAPITAL EXPENDITURE”  SHALL MEAN ANY EXPENDITURE TREATED AS CAPITAL
IN NATURE IN ACCORDANCE WITH GAAP.

 

1.12        “CHANGE IN CONTROL”  SHALL MEAN (A) THE ACQUISITION BY ANY PERSON,
OR TWO OR MORE PERSONS ACTING IN CONCERT, OF BENEFICIAL OWNERSHIP (WITHIN THE
MEANING OF RULE 13D-3 OF THE SEC) OF 9.8% OR MORE, OR RIGHTS, OPTIONS OR
WARRANTS TO ACQUIRE 9.8% OR MORE, OF THE OUTSTANDING SHARES OF VOTING STOCK OR
OTHER VOTING INTERESTS OF TENANT OR ANY GUARANTOR, AS THE CASE MAY BE, OR THE
POWER TO DIRECT THE MANAGEMENT AND POLICIES OF TENANT OR ANY GUARANTOR, DIRECTLY
OR INDIRECTLY, (B) THE MERGER OR CONSOLIDATION OF TENANT OR ANY GUARANTOR WITH
OR INTO ANY PERSON OR THE MERGER OR CONSOLIDATION OF ANY PERSON INTO TENANT OR
ANY GUARANTOR (OTHER THAN THE MERGER OR CONSOLIDATION OF ANY PERSON INTO TENANT
OR ANY GUARANTOR THAT DOES NOT RESULT IN A CHANGE IN CONTROL OF TENANT OR SUCH
GUARANTOR UNDER CLAUSES (A), (C), (D) OR (E) OF THIS DEFINITION), (C) ANY ONE OR
MORE SALES, CONVEYANCES, DIVIDENDS OR DISTRIBUTIONS TO ANY PERSON OF ALL OR ANY
MATERIAL PORTION OF THE ASSETS (INCLUDING CAPITAL STOCK OR OTHER EQUITY
INTERESTS) OR BUSINESS OF TENANT OR ANY GUARANTOR, WHETHER OR NOT OTHERWISE A
CHANGE IN CONTROL, (D) THE CESSATION, FOR ANY REASON, OF THE INDIVIDUALS WHO AT
THE BEGINNING OF ANY TWENTY-FOUR (24) CONSECUTIVE MONTH PERIOD (COMMENCING ON
THE DATE HEREOF) CONSTITUTED THE BOARD OF DIRECTORS OF TENANT OR ANY GUARANTOR
(TOGETHER WITH ANY NEW DIRECTORS WHOSE ELECTION BY SUCH BOARD OR WHOSE
NOMINATION FOR ELECTION BY THE SHAREHOLDERS OF TENANT OR SUCH GUARANTOR WAS
APPROVED BY A VOTE OF A MAJORITY OF THE DIRECTORS THEN STILL IN OFFICE WHO WERE
EITHER DIRECTORS AT THE BEGINNING OF ANY SUCH PERIOD OR WHOSE ELECTION OR
NOMINATION FOR ELECTION WAS PREVIOUSLY SO APPROVED) TO CONSTITUTE A MAJORITY OF
THE BOARD OF DIRECTORS OF TENANT OR SUCH GUARANTOR THEN IN OFFICE, OR (E) THE
ELECTION TO THE BOARD OF DIRECTORS OF TENANT OR ANY GUARANTOR OF ANY INDIVIDUAL
NOT NOMINATED OR APPOINTED BY VOTE OF A MAJORITY OF THE DIRECTORS OF TENANT OR
SUCH GUARANTOR IN OFFICE IMMEDIATELY PRIOR TO THE NOMINATION OR APPOINTMENT OF
SUCH INDIVIDUAL.

 

1.13        “CLAIM”  SHALL HAVE THE MEANING GIVEN SUCH TERM IN ARTICLE 8.

 

1.14        “CODE”  SHALL MEAN THE INTERNAL REVENUE CODE OF 1986 AND, TO THE
EXTENT APPLICABLE, THE TREASURY REGULATIONS PROMULGATED THEREUNDER, EACH AS FROM
TIME TO TIME AMENDED.

 

1.15        “COMMENCEMENT DATE”  SHALL MEAN, WITH RESPECT TO EACH PROPERTY, THE
CALENDAR DATE SPECIFIED AS THE COMMENCEMENT DATE WITH RESPECT TO SUCH PROPERTY
ON SCHEDULE 1 ATTACHED HERETO AND MADE A PART HEREOF.

 

4

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1.16                        “CONDEMNATION”  SHALL MEAN, WITH RESPECT TO ANY
PROPERTY, OR ANY PORTION THEREOF, (A) THE EXERCISE OF ANY GOVERNMENTAL POWER
WITH RESPECT TO SUCH PROPERTY, WHETHER BY LEGAL PROCEEDINGS OR OTHERWISE, BY A
CONDEMNOR OF ITS POWER OF CONDEMNATION, (B) A VOLUNTARY SALE OR TRANSFER OF SUCH
PROPERTY BY LANDLORD TO ANY CONDEMNOR, EITHER UNDER THREAT OF CONDEMNATION OR
WHILE LEGAL PROCEEDINGS FOR CONDEMNATION ARE PENDING, OR (C) A TAKING OR
VOLUNTARY CONVEYANCE OF SUCH PROPERTY, OR ANY INTEREST THEREIN, OR RIGHT
ACCRUING THERETO OR USE THEREOF, AS THE RESULT OR IN SETTLEMENT OF ANY
CONDEMNATION OR OTHER EMINENT DOMAIN PROCEEDING AFFECTING SUCH PROPERTY, WHETHER
OR NOT THE SAME SHALL HAVE ACTUALLY BEEN COMMENCED.

 

1.17                        “CONDEMNOR”  SHALL MEAN ANY PUBLIC OR QUASI-PUBLIC
PERSON, HAVING THE POWER OF CONDEMNATION.

 

1.18                        “CONSOLIDATED FINANCIALS”  SHALL MEAN, FOR ANY
FISCAL YEAR OR OTHER ACCOUNTING PERIOD OF FIVE STAR, ANNUAL AUDITED AND
QUARTERLY UNAUDITED FINANCIAL STATEMENTS OF FIVE STAR PREPARED ON A CONSOLIDATED
BASIS, INCLUDING FIVE STAR’S CONSOLIDATED BALANCE SHEET AND THE RELATED
STATEMENTS OF INCOME AND CASH FLOWS, ALL IN REASONABLE DETAIL, AND SETTING FORTH
IN COMPARATIVE FORM THE CORRESPONDING FIGURES FOR THE CORRESPONDING PERIOD IN
THE PRECEDING FISCAL YEAR, AND PREPARED IN ACCORDANCE WITH GAAP THROUGHOUT THE
PERIODS REFLECTED.

 

1.19                        “DATE OF TAKING”  SHALL MEAN, WITH RESPECT TO ANY
PROPERTY, THE DATE THE CONDEMNOR HAS THE RIGHT TO POSSESSION OF SUCH PROPERTY,
OR ANY PORTION THEREOF, IN CONNECTION WITH A CONDEMNATION.

 

1.20                        “DEFAULT”  SHALL MEAN ANY EVENT OR CONDITION WHICH
WITH THE GIVING OF NOTICE AND/OR LAPSE OF TIME WOULD RIPEN INTO AN EVENT OF
DEFAULT.

 

1.21                        “DISBURSEMENT RATE”  SHALL MEAN AN ANNUAL RATE OF
INTEREST, AS OF THE DATE OF DETERMINATION, EQUAL TO THE GREATER OF (A) EIGHT
PERCENT (8%) AND (B) THE PER ANNUM RATE FOR TEN (10) YEAR U.S. TREASURY
OBLIGATIONS AS PUBLISHED IN THE WALL STREET JOURNAL PLUS THREE HUNDRED (300)
BASIS POINTS; PROVIDED, HOWEVER, THAT IN NO EVENT SHALL THE DISBURSEMENT RATE
EXCEED ELEVEN AND ONE-HALF PERCENT (11.5%).

 

1.22                        “DISTRIBUTION”  SHALL MEAN (A) ANY DECLARATION OR
PAYMENT OF ANY DIVIDEND (EXCEPT ORDINARY CASH DIVIDENDS PAYABLE IN COMMON STOCK
OR OTHER EQUITY INTERESTS OF TENANT) ON OR IN RESPECT OF ANY SHARES OF ANY CLASS
OF CAPITAL STOCK OR OTHER EQUITY INTERESTS OF TENANT, (B) ANY PURCHASE,
REDEMPTION, RETIREMENT OR OTHER ACQUISITION OF ANY SHARES OF ANY CLASS OF

 

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CAPITAL STOCK OF A CORPORATION, (C) ANY OTHER DISTRIBUTION ON OR IN RESPECT OF
ANY SHARES OF ANY CLASS OF CAPITAL STOCK OF A CORPORATION OR (D) ANY RETURN OF
CAPITAL TO SHAREHOLDERS.

 

1.23                        “EASEMENT AGREEMENT”  SHALL MEAN ANY CONDITIONS,
COVENANTS AND RESTRICTIONS, EASEMENTS, DECLARATIONS, LICENSES AND OTHER
AGREEMENTS WHICH ARE PERMITTED ENCUMBRANCES AND SUCH OTHER AGREEMENTS AS MAY BE
GRANTED IN ACCORDANCE WITH SECTION 19.1.

 

1.24                        “ENCUMBRANCE”  SHALL HAVE THE MEANING GIVEN SUCH
TERM IN SECTION 20.1.

 

1.25                        “ENTITY”  SHALL MEAN ANY CORPORATION, GENERAL OR
LIMITED PARTNERSHIP, LIMITED LIABILITY COMPANY OR PARTNERSHIP, STOCK COMPANY OR
ASSOCIATION, JOINT VENTURE, ASSOCIATION, COMPANY, TRUST, BANK, TRUST COMPANY,
LAND TRUST, BUSINESS TRUST, COOPERATIVE, ANY GOVERNMENT OR AGENCY, AUTHORITY OR
POLITICAL SUBDIVISION THEREOF OR ANY OTHER ENTITY.

 

1.26                        “ENVIRONMENT”  SHALL MEAN SOIL, SURFACE WATERS,
GROUND WATERS, LAND, STREAM, SEDIMENTS, SURFACE OR SUBSURFACE STRATA AND AMBIENT
AIR.

 

1.27                        “ENVIRONMENTAL OBLIGATION”  SHALL HAVE THE MEANING
GIVEN SUCH TERM IN SECTION 4.4.1.

 

1.28                        “ENVIRONMENTAL NOTICE”  SHALL HAVE THE MEANING GIVEN
SUCH TERM IN SECTION 4.4.1.

 

1.29                        “EVENT OF DEFAULT”  SHALL HAVE THE MEANING GIVEN
SUCH TERM IN SECTION 12.1.

 

1.30                        “EXCESS GROSS REVENUES”  SHALL MEAN THE AMOUNT OF
GROSS REVENUES FOR ANY LEASE YEAR, OR PORTION THEREOF, IN EXCESS OF BASE GROSS
REVENUES FOR THE EQUIVALENT PERIOD DURING THE BASE YEAR.

 

1.31                        “EXTENDED TERM”  SHALL HAVE THE MEANING GIVEN SUCH
TERM IN SECTION 2.4.

 

1.32                        “FACILITY”  SHALL MEAN, WITH RESPECT TO ANY
PROPERTY, THE SKILLED NURSING/INTERMEDIATE CARE/INDEPENDENT LIVING/ASSISTED
LIVING/SPECIAL CARE/GROUP HOME FACILITY BEING OPERATED OR PROPOSED TO BE
OPERATED ON SUCH PROPERTY.

 

1.33                        “FACILITY MORTGAGE”  SHALL MEAN ANY ENCUMBRANCE
PLACED UPON THE LEASED PROPERTY, OR ANY PORTION THEREOF, IN ACCORDANCE WITH
ARTICLE 20.

 

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1.34                        “FACILITY MORTGAGEE”  SHALL MEAN THE HOLDER OF ANY
FACILITY MORTGAGE.

 

1.35                        “FINANCIAL OFFICER’S CERTIFICATE”  SHALL MEAN, AS TO
ANY PERSON, A CERTIFICATE OF THE CHIEF EXECUTIVE OFFICER, CHIEF FINANCIAL
OFFICER OR CHIEF ACCOUNTING OFFICER (OR SUCH OFFICERS’ AUTHORIZED DESIGNEE) OF
SUCH PERSON, DULY AUTHORIZED, ACCOMPANYING THE FINANCIAL STATEMENTS REQUIRED TO
BE DELIVERED BY SUCH PERSON PURSUANT TO SECTION 17.2, IN WHICH SUCH OFFICER
SHALL CERTIFY (A) THAT SUCH STATEMENTS HAVE BEEN PROPERLY PREPARED IN ACCORDANCE
WITH GAAP AND ARE TRUE, CORRECT AND COMPLETE IN ALL MATERIAL RESPECTS AND FAIRLY
PRESENT THE CONSOLIDATED FINANCIAL CONDITION OF SUCH PERSON AT AND AS OF THE
DATES THEREOF AND THE RESULTS OF ITS AND THEIR OPERATIONS FOR THE PERIODS
COVERED THEREBY, AND (B) IN THE EVENT THAT THE CERTIFYING PARTY IS AN OFFICER OF
TENANT AND THE CERTIFICATE IS BEING GIVEN IN SUCH CAPACITY, THAT NO EVENT OF
DEFAULT HAS OCCURRED AND IS CONTINUING HEREUNDER.

 

1.36                        “FISCAL YEAR”  SHALL MEAN THE CALENDAR YEAR OR SUCH
OTHER ANNUAL PERIOD DESIGNATED BY TENANT AND APPROVED BY LANDLORD.

 

1.37                        “FIVE STAR”  SHALL MEAN FIVE STAR QUALITY
CARE, INC., A MARYLAND CORPORATION, AND ITS PERMITTED SUCCESSORS AND ASSIGNS.

 

1.38                        “FIXED TERM”  SHALL HAVE THE MEANING GIVEN SUCH TERM
IN SECTION 2.3.

 

1.39                        “FIXTURES”  SHALL HAVE THE MEANING GIVEN SUCH TERM
IN SECTION 2.1(D).

 

1.40                        “GAAP”  SHALL MEAN GENERALLY ACCEPTED ACCOUNTING
PRINCIPLES CONSISTENTLY APPLIED.

 

1.41                        “GOVERNMENT AGENCIES”  SHALL MEAN ANY COURT, AGENCY,
AUTHORITY, BOARD (INCLUDING, WITHOUT LIMITATION, ENVIRONMENTAL PROTECTION,
PLANNING AND ZONING), BUREAU, COMMISSION, DEPARTMENT, OFFICE OR INSTRUMENTALITY
OF ANY NATURE WHATSOEVER OF ANY GOVERNMENTAL OR QUASI-GOVERNMENTAL UNIT OF THE
UNITED STATES OR ANY STATE OR ANY COUNTY OR ANY POLITICAL SUBDIVISION OF ANY OF
THE FOREGOING, WHETHER NOW OR HEREAFTER IN EXISTENCE, HAVING JURISDICTION OVER
TENANT OR ANY PROPERTY, OR ANY PORTION THEREOF, OR ANY FACILITY OPERATED
THEREON.

 

1.42                        “GROSS REVENUES”  SHALL MEAN, FOR EACH FISCAL YEAR
DURING THE TERM, IN THE AGGREGATE, ALL REVENUES AND RECEIPTS (DETERMINED ON AN
ACCRUAL BASIS AND IN ALL MATERIAL RESPECTS IN

 

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ACCORDANCE WITH GAAP) OF EVERY KIND DERIVED FROM RENTING, USING AND/OR OPERATING
THE LEASED PROPERTY AND THE LTA GMAC LEASED PROPERTY AND PARTS THEREOF,
INCLUDING, BUT NOT LIMITED TO:  ALL RENTS AND REVENUES RECEIVED OR RECEIVABLE
FOR THE USE OF OR OTHERWISE BY REASON OF ALL UNITS, BEDS AND OTHER FACILITIES
PROVIDED, MEALS SERVED, SERVICES PERFORMED, SPACE OR FACILITIES SUBLEASED OR
GOODS SOLD ON THE LEASED PROPERTY OR THE LTA GMAC LEASED PROPERTY, OR ANY
PORTION THEREOF, INCLUDING, WITHOUT LIMITATION, ANY OTHER ARRANGEMENTS WITH
THIRD PARTIES RELATING TO THE POSSESSION OR USE OF ANY PORTION OF THE LEASED
PROPERTY OR THE LTA GMAC LEASED PROPERTY; AND PROCEEDS, IF ANY, FROM BUSINESS
INTERRUPTION OR OTHER LOSS OF INCOME INSURANCE; PROVIDED, HOWEVER, THAT GROSS
REVENUES SHALL NOT INCLUDE THE FOLLOWING:  REVENUE FROM PROFESSIONAL FEES OR
CHARGES BY PHYSICIANS AND UNAFFILIATED PROVIDERS OF SERVICES, WHEN AND TO THE
EXTENT SUCH CHARGES ARE PAID OVER TO SUCH PHYSICIANS AND UNAFFILIATED PROVIDERS
OF SERVICES, OR ARE SEPARATELY BILLED AND NOT INCLUDED IN COMPREHENSIVE FEES;
CONTRACTUAL ALLOWANCES (RELATING TO ANY PERIOD DURING THE TERM) FOR BILLINGS NOT
PAID BY OR RECEIVED FROM THE APPROPRIATE GOVERNMENTAL AGENCIES OR THIRD PARTY
PROVIDERS; ALLOWANCES ACCORDING TO GAAP FOR UNCOLLECTIBLE ACCOUNTS, INCLUDING
CREDIT CARD ACCOUNTS AND CHARITY CARE OR OTHER ADMINISTRATIVE DISCOUNTS; ALL
PROPER PATIENT BILLING CREDITS AND ADJUSTMENTS ACCORDING TO GAAP RELATING TO
HEALTH CARE ACCOUNTING; PROVIDER DISCOUNTS FOR HOSPITAL OR OTHER MEDICAL
FACILITY UTILIZATION CONTRACTS AND CREDIT CARD DISCOUNTS; ANY AMOUNTS ACTUALLY
PAID BY TENANT FOR THE COST OF ANY FEDERAL, STATE OR LOCAL GOVERNMENTAL PROGRAMS
IMPOSED SPECIALLY TO PROVIDE OR FINANCE INDIGENT PATIENT CARE; FEDERAL, STATE OR
MUNICIPAL EXCISE, SALES, USE, OCCUPANCY OR SIMILAR TAXES COLLECTED DIRECTLY FROM
PATIENTS, CLIENTS OR RESIDENTS OR INCLUDED AS PART OF THE SALES PRICE OF ANY
GOODS OR SERVICES; INSURANCE PROCEEDS (OTHER THAN PROCEEDS FROM BUSINESS
INTERRUPTION OR OTHER LOSS OF INCOME INSURANCE); AWARD PROCEEDS (OTHER THAN FOR
A TEMPORARY CONDEMNATION); REVENUES ATTRIBUTABLE TO SERVICES ACTUALLY PROVIDED
OFF-SITE OR OTHERWISE AWAY FROM THE LEASED PROPERTY OR THE LTA GMAC LEASED
PROPERTY, SUCH AS HOME HEALTH CARE, TO PERSONS THAT ARE NOT PATIENTS, CLIENTS OR
RESIDENTS AT THE LEASED PROPERTY OR THE LTA GMAC LEASED PROPERTY; REVENUES
ATTRIBUTABLE TO CHILD CARE SERVICES PROVIDED PRIMARILY TO EMPLOYEES OF THE
LEASED PROPERTY OR THE LTA GMAC LEASED PROPERTY; ANY PROCEEDS FROM ANY SALE OF
THE LEASED PROPERTY OR THE LTA GMAC LEASED PROPERTY OR FROM THE REFINANCING OF
ANY DEBT ENCUMBERING THE LEASED PROPERTY OR THE LTA GMAC LEASED PROPERTY;
PROCEEDS FROM THE DISPOSITION OF FURNISHINGS, FIXTURE AND EQUIPMENT NO LONGER
NECESSARY FOR THE OPERATION OF THE FACILITY LOCATED THEREON; ANY SECURITY
DEPOSITS AND OTHER ADVANCE DEPOSITS, UNTIL AND UNLESS THE SAME ARE FORFEITED TO

 

8

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TENANT OR APPLIED FOR THE PURPOSE FOR WHICH THEY WERE COLLECTED; AND INTEREST
INCOME FROM ANY BANK ACCOUNT OR INVESTMENT OF TENANT.

 

1.43                        “GUARANTOR”  SHALL MEAN FIVE STAR AND EACH AND EVERY
OTHER GUARANTOR OF TENANT’S OBLIGATIONS UNDER THIS AGREEMENT, AND EACH SUCH
GUARANTOR’S SUCCESSORS AND ASSIGNS.

 

1.44                        “GUARANTY”  SHALL MEAN ANY GUARANTY AGREEMENT
EXECUTED BY A GUARANTOR IN FAVOR OF LANDLORD PURSUANT TO WHICH THE PAYMENT OR
PERFORMANCE OF TENANT’S OBLIGATIONS UNDER THIS AGREEMENT ARE GUARANTEED,
TOGETHER WITH ALL MODIFICATIONS, AMENDMENTS AND SUPPLEMENTS THERETO.

 

1.45                        “HAZARDOUS SUBSTANCES”  SHALL MEAN ANY SUBSTANCE:

 

(A)                                  THE PRESENCE OF WHICH REQUIRES OR MAY
HEREAFTER REQUIRE NOTIFICATION, INVESTIGATION OR REMEDIATION UNDER ANY FEDERAL,
STATE OR LOCAL STATUTE, REGULATION, RULE, ORDINANCE, ORDER, ACTION OR POLICY; OR

 

(B)                                 WHICH IS OR BECOMES DEFINED AS A “HAZARDOUS
WASTE”, “HAZARDOUS MATERIAL” OR “HAZARDOUS SUBSTANCE” OR “POLLUTANT” OR
“CONTAMINANT” UNDER ANY PRESENT OR FUTURE FEDERAL, STATE OR LOCAL STATUTE,
REGULATION, RULE OR ORDINANCE OR AMENDMENTS THERETO INCLUDING, WITHOUT
LIMITATION, THE COMPREHENSIVE ENVIRONMENTAL RESPONSE, COMPENSATION AND LIABILITY
ACT (42 U.S.C. SECTION 9601 ET SEQ.) AND THE RESOURCE CONSERVATION AND RECOVERY
ACT (42 U.S.C. SECTION 6901 ET SEQ.) AND THE REGULATIONS PROMULGATED THEREUNDER;
OR

 

(C)                                  WHICH IS TOXIC, EXPLOSIVE, CORROSIVE,
FLAMMABLE, INFECTIOUS, RADIOACTIVE, CARCINOGENIC, MUTAGENIC OR OTHERWISE
HAZARDOUS AND IS OR BECOMES REGULATED BY ANY GOVERNMENTAL AUTHORITY, AGENCY,
DEPARTMENT, COMMISSION, BOARD, AGENCY OR INSTRUMENTALITY OF THE UNITED STATES,
ANY STATE OF THE UNITED STATES, OR ANY POLITICAL SUBDIVISION THEREOF; OR

 

(D)                                 THE PRESENCE OF WHICH ON ANY PROPERTY, OR
ANY PORTION THEREOF, CAUSES OR MATERIALLY THREATENS TO CAUSE AN UNLAWFUL
NUISANCE UPON SUCH PROPERTY, OR ANY PORTION THEREOF, OR TO ADJACENT PROPERTIES
OR POSES OR MATERIALLY THREATENS TO POSE A HAZARD TO SUCH PROPERTY, OR ANY
PORTION THEREOF, OR TO THE HEALTH OR SAFETY OF PERSONS ON OR ABOUT SUCH
PROPERTY, OR ANY PORTION THEREOF; OR

 

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(E)                                  WITHOUT LIMITATION, WHICH CONTAINS
GASOLINE, DIESEL FUEL OR OTHER PETROLEUM HYDROCARBONS OR VOLATILE ORGANIC
COMPOUNDS; OR

 

(F)                                    WITHOUT LIMITATION, WHICH CONTAINS
POLYCHLORINATED BIPHENYLS (PCBS) OR ASBESTOS OR UREA FORMALDEHYDE FOAM
INSULATION; OR

 

(G)                                 WITHOUT LIMITATION, WHICH CONTAINS OR EMITS
RADIOACTIVE PARTICLES, WAVES OR MATERIAL; OR

 

(H)                                 WITHOUT LIMITATION, CONSTITUTES REGULATED
MEDICAL WASTES.

 

1.46                        “IMMEDIATE FAMILY”  SHALL MEAN, WITH RESPECT TO ANY
INDIVIDUAL, SUCH INDIVIDUAL’S SPOUSE, PARENTS, BROTHERS, SISTERS, CHILDREN
(NATURAL OR ADOPTED), STEPCHILDREN, GRANDCHILDREN, GRANDPARENTS, PARENTS-IN-LAW,
BROTHERS-IN-LAW, SISTERS-IN-LAW, NEPHEWS AND NIECES.

 

1.47                        “IMPOSITIONS”  SHALL MEAN, COLLECTIVELY, ALL TAXES
(INCLUDING, WITHOUT LIMITATION, ALL TAXES IMPOSED UNDER THE LAWS OF ANY STATE,
AS SUCH LAWS MAY BE AMENDED FROM TIME TO TIME, AND ALL AD VALOREM, SALES AND
USE, OR SIMILAR TAXES AS THE SAME RELATE TO OR ARE IMPOSED UPON LANDLORD, TENANT
OR THE BUSINESS CONDUCTED UPON THE LEASED PROPERTY), ASSESSMENTS (INCLUDING,
WITHOUT LIMITATION, ALL ASSESSMENTS FOR PUBLIC IMPROVEMENTS OR BENEFIT, WHETHER
OR NOT COMMENCED OR COMPLETED PRIOR TO THE DATE HEREOF), GROUND RENTS (INCLUDING
ANY MINIMUM RENT UNDER ANY GROUND LEASE, AND ANY ADDITIONAL RENT OR CHARGES
THEREUNDER), WATER, SEWER OR OTHER RENTS AND CHARGES, EXCISES, TAX LEVIES, FEES
(INCLUDING, WITHOUT LIMITATION, LICENSE, PERMIT, INSPECTION, AUTHORIZATION AND
SIMILAR FEES), AND ALL OTHER GOVERNMENTAL CHARGES, IN EACH CASE WHETHER GENERAL
OR SPECIAL, ORDINARY OR EXTRAORDINARY, FORESEEN OR UNFORESEEN, OF EVERY
CHARACTER IN RESPECT OF THE LEASED PROPERTY OR THE BUSINESS CONDUCTED THEREON BY
TENANT (INCLUDING ALL INTEREST AND PENALTIES THEREON DUE TO ANY FAILURE IN
PAYMENT BY TENANT), WHICH AT ANY TIME PRIOR TO, DURING OR IN RESPECT OF THE TERM
HEREOF MAY BE ASSESSED OR IMPOSED ON OR IN RESPECT OF OR BE A LIEN UPON
(A) LANDLORD’S INTEREST IN THE LEASED PROPERTY, (B) THE LEASED PROPERTY OR ANY
PART THEREOF OR ANY RENT THEREFROM OR ANY ESTATE, RIGHT, TITLE OR INTEREST
THEREIN, OR (C) ANY OCCUPANCY, OPERATION, USE OR POSSESSION OF, OR SALES FROM,
OR ACTIVITY CONDUCTED ON, OR IN CONNECTION WITH THE LEASED PROPERTY OR THE
LEASING OR USE OF THE LEASED PROPERTY OR ANY PART THEREOF BY TENANT; PROVIDED,
HOWEVER, THAT NOTHING CONTAINED HEREIN SHALL BE CONSTRUED TO REQUIRE TENANT TO
PAY AND THE TERM “IMPOSITIONS” SHALL NOT INCLUDE (I) ANY TAX BASED ON NET INCOME

 

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IMPOSED ON LANDLORD, (II) ANY NET REVENUE TAX OF LANDLORD, (III) ANY TRANSFER
FEE (BUT EXCLUDING ANY MORTGAGE OR SIMILAR TAX PAYABLE IN CONNECTION WITH A
FACILITY MORTGAGE) OR OTHER TAX IMPOSED WITH RESPECT TO THE SALE, EXCHANGE OR
OTHER DISPOSITION BY LANDLORD OF THE LEASED PROPERTY OR THE PROCEEDS THEREOF,
(IV) ANY SINGLE BUSINESS, GROSS RECEIPTS TAX, TRANSACTION PRIVILEGE, RENT OR
SIMILAR TAXES AS THE SAME RELATE TO OR ARE IMPOSED UPON LANDLORD, (V) ANY
INTEREST OR PENALTIES IMPOSED ON LANDLORD AS A RESULT OF THE FAILURE OF LANDLORD
TO FILE ANY RETURN OR REPORT TIMELY AND IN THE FORM PRESCRIBED BY LAW OR TO PAY
ANY TAX OR IMPOSITION, EXCEPT TO THE EXTENT SUCH FAILURE IS A RESULT OF A BREACH
BY TENANT OF ITS OBLIGATIONS PURSUANT TO SECTION 3.1.3, (VI) ANY IMPOSITIONS
IMPOSED ON LANDLORD THAT ARE A RESULT OF LANDLORD NOT BEING CONSIDERED A “UNITED
STATES PERSON” AS DEFINED IN SECTION 7701(A)(30) OF THE CODE, (VII) ANY
IMPOSITIONS THAT ARE ENACTED OR ADOPTED BY THEIR EXPRESS TERMS AS A SUBSTITUTE
FOR ANY TAX THAT WOULD NOT HAVE BEEN PAYABLE BY TENANT PURSUANT TO THE TERMS OF
THIS AGREEMENT OR (VIII) ANY IMPOSITIONS IMPOSED AS A RESULT OF A BREACH OF
COVENANT OR REPRESENTATION BY LANDLORD IN ANY AGREEMENT GOVERNING LANDLORD’S
CONDUCT OR OPERATION OR AS A RESULT OF THE NEGLIGENCE OR WILLFUL MISCONDUCT OF
LANDLORD.

 

1.48                        “INCIDENTAL DOCUMENTS”  SHALL MEAN, COLLECTIVELY,
ANY GUARANTY, ANY SECURITY AGREEMENT AND ANY PLEDGE AGREEMENT.

 

1.49                        “INDEBTEDNESS”  SHALL MEAN ALL OBLIGATIONS,
CONTINGENT OR OTHERWISE, WHICH IN ACCORDANCE WITH GAAP SHOULD BE REFLECTED ON
THE OBLIGOR’S BALANCE SHEET AS LIABILITIES.

 

1.50                        “INSURANCE REQUIREMENTS”  SHALL MEAN ALL TERMS OF
ANY INSURANCE POLICY REQUIRED BY THIS AGREEMENT AND ALL REQUIREMENTS OF THE
ISSUER OF ANY SUCH POLICY AND ALL ORDERS, RULES AND REGULATIONS AND ANY OTHER
REQUIREMENTS OF THE NATIONAL BOARD OF FIRE UNDERWRITERS (OR ANY OTHER BODY
EXERCISING SIMILAR FUNCTIONS) BINDING UPON LANDLORD, TENANT, ANY MANAGER OR THE
LEASED PROPERTY.

 

1.51                        “INTEREST RATE”  SHALL MEAN, WITH RESPECT TO EACH
PROPERTY, THE PER ANNUM INTEREST RATE SPECIFIED AS THE INTEREST RATE WITH
RESPECT TO SUCH PROPERTY ON SCHEDULE 1 ATTACHED HERETO AND MADE A PART HEREOF.

 

1.52                        “LTA GMAC LEASED PROPERTY”  SHALL MEAN THE “LEASED
PROPERTY,” AS DEFINED THEREIN, UNDER THE LTA GMAC LEASES.

 

1.53                        “LTA GMAC LEASES”  SHALL MEAN, COLLECTIVELY, THE
LEASES, DATED AS OF NOVEMBER 19, 2004, BY AND AMONG CERTAIN AFFILIATED PERSONS
OF LANDLORD AND CERTAIN AFFILIATED PERSONS OF

 

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TENANT, TOGETHER WITH ALL MODIFICATIONS, AMENDMENTS AND SUPPLEMENTS THERETO.

 

1.54                        “LTA GMAC PROPERTY”  SHALL MEAN A “PROPERTY,” AS
DEFINED THEREIN, UNDER THE LTA GMAC LEASES.

 

1.55                        “LAND”  SHALL HAVE THE MEANING GIVEN SUCH TERM IN
SECTION 2.1(A).

 

1.56                        “LANDLORD”  SHALL HAVE THE MEANING GIVEN SUCH TERM
IN THE PREAMBLES TO THIS AGREEMENT AND SHALL ALSO INCLUDE THEIR RESPECTIVE
PERMITTED SUCCESSORS AND ASSIGNS.

 

1.57                        “LANDLORD DEFAULT”  SHALL HAVE THE MEANING GIVEN
SUCH TERM IN ARTICLE 14.

 

1.58                        “LANDLORD LIENS”  SHALL MEAN LIENS ON OR AGAINST THE
LEASED PROPERTY OR ANY PAYMENT OF RENT (A) WHICH RESULT FROM ANY ACT OF, OR ANY
CLAIM AGAINST, LANDLORD OR ANY OWNER OF A DIRECT OR INDIRECT INTEREST IN THE
LEASED PROPERTY (OTHER THAN THE LESSOR UNDER ANY GROUND LEASE AFFECTING ANY
PORTION OF THE LEASED PROPERTY), OR WHICH RESULT FROM ANY VIOLATION BY LANDLORD
OF ANY TERMS OF THIS AGREEMENT, OR (B) WHICH RESULT FROM LIENS IN FAVOR OF ANY
TAXING AUTHORITY BY REASON OF ANY TAX OWED BY LANDLORD OR ANY FEE OWNER OF A
DIRECT OR INDIRECT INTEREST IN THE LEASED PROPERTY (OTHER THAN THE LESSOR UNDER
ANY GROUND LEASE AFFECTING ANY PORTION OF THE LEASED PROPERTY); PROVIDED,
HOWEVER, THAT “LANDLORD LIEN” SHALL NOT INCLUDE ANY LIEN RESULTING FROM ANY TAX
FOR WHICH TENANT IS OBLIGATED TO PAY OR INDEMNIFY LANDLORD AGAINST UNTIL SUCH
TIME AS TENANT SHALL HAVE ALREADY PAID TO OR ON BEHALF OF LANDLORD THE TAX OR
THE REQUIRED INDEMNITY WITH RESPECT TO THE SAME.

 

1.59                        “LEASE YEAR”  SHALL MEAN ANY FISCAL YEAR OR PORTION
THEREOF DURING THE TERM.

 

1.60                        “LEASED IMPROVEMENTS”  SHALL HAVE THE MEANING GIVEN
SUCH TERM IN SECTION 2.1(B).

 

1.61                        “LEASED INTANGIBLE PROPERTY”  SHALL MEAN ALL
AGREEMENTS, SERVICE CONTRACTS, EQUIPMENT LEASES, BOOKING AGREEMENTS AND OTHER
ARRANGEMENTS OR AGREEMENTS AFFECTING THE OWNERSHIP, REPAIR, MAINTENANCE,
MANAGEMENT, LEASING OR OPERATION OF THE LEASED PROPERTY, OR ANY PORTION THEREOF,
TO WHICH LANDLORD IS A PARTY; ALL BOOKS, RECORDS AND FILES RELATING TO THE
LEASING, MAINTENANCE, MANAGEMENT OR OPERATION OF THE LEASED PROPERTY, OR ANY
PORTION THEREOF, BELONGING TO LANDLORD; ALL TRANSFERABLE OR ASSIGNABLE PERMITS,
CERTIFICATES OF OCCUPANCY, OPERATING PERMITS, SIGN PERMITS, DEVELOPMENT RIGHTS
AND

 

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APPROVALS, CERTIFICATES, LICENSES, WARRANTIES AND GUARANTEES, RIGHTS TO
DEPOSITS, TRADE NAMES, SERVICE MARKS, TELEPHONE EXCHANGE NUMBERS IDENTIFIED WITH
THE LEASED PROPERTY, AND ALL OTHER TRANSFERABLE INTANGIBLE PROPERTY,
MISCELLANEOUS RIGHTS, BENEFITS AND PRIVILEGES OF ANY KIND OR CHARACTER BELONGING
TO LANDLORD WITH RESPECT TO THE LEASED PROPERTY.

 

1.62                        “LEASED PROPERTY”  SHALL HAVE THE MEANING GIVEN SUCH
TERM IN SECTION 2.1.

 

1.63                        “LEGAL REQUIREMENTS”  SHALL MEAN ALL FEDERAL, STATE,
COUNTY, MUNICIPAL AND OTHER GOVERNMENTAL STATUTES, LAWS, RULES, ORDERS,
REGULATIONS, ORDINANCES, JUDGMENTS, DECREES AND INJUNCTIONS AFFECTING THE LEASED
PROPERTY OR THE MAINTENANCE, CONSTRUCTION, ALTERATION OR OPERATION THEREOF,
WHETHER NOW OR HEREAFTER ENACTED OR IN EXISTENCE, INCLUDING, WITHOUT LIMITATION,
(A) ALL PERMITS, LICENSES, AUTHORIZATIONS, CERTIFICATES OF NEED, AUTHORIZATIONS
AND REGULATIONS NECESSARY TO OPERATE ANY PROPERTY FOR ITS PERMITTED USE, AND
(B) ALL COVENANTS, AGREEMENTS, RESTRICTIONS AND ENCUMBRANCES CONTAINED IN ANY
INSTRUMENTS AT ANY TIME IN FORCE AFFECTING ANY PROPERTY, INCLUDING THOSE WHICH
MAY (I) REQUIRE MATERIAL REPAIRS, MODIFICATIONS OR ALTERATIONS IN OR TO ANY
PROPERTY OR (II) IN ANY WAY MATERIALLY AND ADVERSELY AFFECT THE USE AND
ENJOYMENT THEREOF, BUT EXCLUDING ANY REQUIREMENTS ARISING AS A RESULT OF
LANDLORD’S STATUS AS A REAL ESTATE INVESTMENT TRUST.

 

1.64                        “LIEN”  SHALL MEAN ANY MORTGAGE, SECURITY INTEREST,
PLEDGE, COLLATERAL ASSIGNMENT, OR OTHER ENCUMBRANCE, LIEN OR CHARGE OF ANY KIND,
OR ANY TRANSFER OF PROPERTY OR ASSETS FOR THE PURPOSE OF SUBJECTING THE SAME TO
THE PAYMENT OF INDEBTEDNESS OR PERFORMANCE OF ANY OTHER OBLIGATION IN PRIORITY
TO PAYMENT OF GENERAL CREDITORS.

 

1.65                        “MANAGER”  SHALL MEAN, WITH RESPECT TO ANY PROPERTY,
THE OPERATOR OR MANAGER UNDER ANY MANAGEMENT AGREEMENT FROM TIME TO TIME IN
EFFECT WITH RESPECT TO SUCH PROPERTY, AND ITS PERMITTED SUCCESSORS AND ASSIGNS.

 

1.66                        “MANAGEMENT AGREEMENT”  SHALL MEAN, WITH RESPECT TO
ANY PROPERTY, ANY OPERATING OR MANAGEMENT AGREEMENT FROM TIME TO TIME ENTERED
INTO BY TENANT WITH RESPECT TO SUCH PROPERTY IN ACCORDANCE WITH THE APPLICABLE
PROVISIONS OF THIS AGREEMENT, TOGETHER WITH ALL AMENDMENTS, MODIFICATIONS AND
SUPPLEMENTS THERETO.

 

1.67                        “MASTER LEASE AGREEMENT NO. 3”  SHALL MEAN THAT
CERTAIN AMENDED AND RESTATED MASTER LEASE AGREEMENT (LEASE NO. 3), DATED AS OF
JUNE 30, 2008, AMONG SNH SOMERFORD PROPERTIES

 

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TRUST, SPTIHS PROPERTIES TRUST, SPTMNR PROPERTIES TRUST AND TENANT, AS IT MAY BE
AMENDED, RESTATED, SUPPLEMENTED OR OTHERWISE MODIFIED FROM TIME TO TIME.

 

1.68                        “MINIMUM RENT”  SHALL MEAN THE SUM OF FIFTY-TWO
MILLION TWO HUNDRED THIRTY-SIX THOUSAND EIGHT HUNDRED TWENTY-FIVE AND 00/100S
DOLLARS ($52,236,825.00) PER ANNUM.

 

1.69                        “NOTICE”  SHALL MEAN A NOTICE GIVEN IN ACCORDANCE
WITH SECTION 23.10.

 

1.70                        “OFFICER’S CERTIFICATE”  SHALL MEAN A CERTIFICATE
SIGNED BY AN OFFICER OR OTHER DULY AUTHORIZED INDIVIDUAL OF THE CERTIFYING
ENTITY DULY AUTHORIZED BY THE BOARD OF DIRECTORS OR OTHER GOVERNING BODY OF THE
CERTIFYING ENTITY.

 

1.71                        “ORIGINAL LEASE”  SHALL HAVE THE MEANING GIVEN SUCH
TERM IN THE RECITALS TO THIS AGREEMENT.

 

1.72                        “OVERDUE RATE”  SHALL MEAN, ON ANY DATE, A PER ANNUM
RATE OF INTEREST EQUAL TO THE LESSER OF FIFTEEN PERCENT (15%) AND THE MAXIMUM
RATE THEN PERMITTED UNDER APPLICABLE LAW.

 

1.73                        “PARENT”  SHALL MEAN, WITH RESPECT TO ANY PERSON,
ANY PERSON WHICH OWNS DIRECTLY, OR INDIRECTLY THROUGH ONE OR MORE SUBSIDIARIES
OR AFFILIATED PERSONS, TWENTY PERCENT (20%) OR MORE OF THE VOTING OR BENEFICIAL
INTEREST IN, OR OTHERWISE HAS THE RIGHT OR POWER (WHETHER BY CONTRACT, THROUGH
OWNERSHIP OF SECURITIES OR OTHERWISE) TO CONTROL, SUCH PERSON.

 

1.74                        “PERMITTED ENCUMBRANCES”  SHALL MEAN, WITH RESPECT
TO ANY PROPERTY, ALL RIGHTS, RESTRICTIONS, AND EASEMENTS OF RECORD SET FORTH ON
SCHEDULE B TO THE APPLICABLE OWNER’S OR LEASEHOLD TITLE INSURANCE POLICY ISSUED
TO LANDLORD WITH RESPECT TO SUCH PROPERTY, PLUS ANY OTHER ENCUMBRANCES AS MAY
HAVE BEEN GRANTED OR CAUSED BY LANDLORD OR OTHERWISE CONSENTED TO IN WRITING BY
LANDLORD FROM TIME TO TIME.

 

1.75                        “PERMITTED LIENS”  SHALL MEAN ANY LIENS GRANTED IN
ACCORDANCE WITH SECTION 21.8(A).

 

1.76                        “PERMITTED USE”  SHALL MEAN, WITH RESPECT TO ANY
PROPERTY, ANY USE OF SUCH PROPERTY PERMITTED PURSUANT TO SECTION 4.1.1.

 

1.77                        “PERSON”  SHALL MEAN ANY INDIVIDUAL OR ENTITY, AND
THE HEIRS, EXECUTORS, ADMINISTRATORS, LEGAL REPRESENTATIVES, SUCCESSORS AND
ASSIGNS OF SUCH PERSON WHERE THE CONTEXT SO ADMITS.

 

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1.78        “PLEDGE AGREEMENT”  SHALL MEAN ANY PLEDGE AGREEMENT MADE IN FAVOR OF
LANDLORD WITH RESPECT TO THE STOCK OR OTHER EQUITY INTERESTS OF TENANT OR ANY
ASSIGNEE, SUBTENANT OR OTHER TRANSFEREE, AS IT OR THEY MAY BE AMENDED, RESTATED,
SUPPLEMENTED OR OTHERWISE MODIFIED FROM TIME TO TIME.

 

1.79        “PROPERTY”  SHALL HAVE THE MEANING GIVEN SUCH TERM IN SECTION 2.1.

 

1.80        “PROVIDER AGREEMENTS”  SHALL MEAN ALL PARTICIPATION, PROVIDER AND
REIMBURSEMENT AGREEMENTS OR ARRANGEMENTS NOW OR HEREAFTER IN EFFECT FOR THE
BENEFIT OF TENANT OR ANY MANAGER IN CONNECTION WITH THE OPERATION OF ANY
FACILITY RELATING TO ANY RIGHT OF PAYMENT OR OTHER CLAIM ARISING OUT OF OR IN
CONNECTION WITH TENANT’S PARTICIPATION IN ANY THIRD PARTY PAYOR PROGRAM.

 

1.81        “RECORDS”  SHALL HAVE THE MEANING GIVEN SUCH TERM IN SECTION 7.2.

 

1.82        “REGULATED MEDICAL WASTES”  SHALL MEAN ALL MATERIALS GENERATED BY
TENANT, SUBTENANTS, PATIENTS, OCCUPANTS OR THE OPERATORS OF THE LEASED
PROPERTIES WHICH ARE NOW OR MAY HEREAFTER BE SUBJECT TO REGULATION PURSUANT TO
THE MATERIAL WASTE TRACKING ACT OF 1988, OR ANY APPLICABLE LAWS PROMULGATED BY
ANY GOVERNMENT AGENCIES.

 

1.83        “RENT”  SHALL MEAN, COLLECTIVELY, THE MINIMUM RENT, ADDITIONAL RENT
AND ADDITIONAL CHARGES.

 

1.84        “SEC”  SHALL MEAN THE SECURITIES AND EXCHANGE COMMISSION.

 

1.85        “SECURITY AGREEMENT”  SHALL MEAN ANY SECURITY AGREEMENT MADE BY
TENANT OR ANY ASSIGNEE, SUBTENANT OR OTHER TRANSFEREE FOR THE BENEFIT OF
LANDLORD, AS IT OR THEY MAY BE AMENDED, RESTATED, SUPPLEMENTED OR OTHERWISE
MODIFIED FROM TIME TO TIME.

 

1.86        “STATE”  SHALL MEAN, WITH RESPECT TO ANY PROPERTY, THE STATE,
COMMONWEALTH OR DISTRICT IN WHICH THE SUCH PROPERTY IS LOCATED.

 

1.87        “SUBORDINATED CREDITOR”  SHALL MEAN ANY CREDITOR OF TENANT WHICH IS
A PARTY TO A SUBORDINATION AGREEMENT IN FAVOR OF LANDLORD.

 

1.88        “SUBORDINATION AGREEMENT”  SHALL MEAN ANY AGREEMENT (AND ANY
AMENDMENTS THERETO) EXECUTED BY A SUBORDINATED CREDITOR PURSUANT TO WHICH THE
PAYMENT AND PERFORMANCE OF TENANT’S

 

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OBLIGATIONS TO SUCH SUBORDINATED CREDITOR ARE SUBORDINATED TO THE PAYMENT AND
PERFORMANCE OF TENANT’S OBLIGATIONS TO LANDLORD UNDER THIS AGREEMENT.

 

1.89        “SUBSIDIARY”  SHALL MEAN, WITH RESPECT TO ANY PERSON, ANY ENTITY
(A) IN WHICH SUCH PERSON OWNS DIRECTLY, OR INDIRECTLY THROUGH ONE OR MORE
SUBSIDIARIES, TWENTY PERCENT (20%) OR MORE OF THE VOTING OR BENEFICIAL INTEREST
OR (B) WHICH SUCH PERSON OTHERWISE HAS THE RIGHT OR POWER TO CONTROL (WHETHER BY
CONTRACT, THROUGH OWNERSHIP OF SECURITIES OR OTHERWISE).

 

1.90        “SUCCESSOR LANDLORD”  SHALL HAVE THE MEANING GIVEN SUCH TERM IN
SECTION 20.2.

 

1.91        “TENANT”  SHALL HAVE THE MEANING GIVEN SUCH TERM IN THE PREAMBLES TO
THIS AGREEMENT AND SHALL ALSO INCLUDE ITS PERMITTED SUCCESSORS AND ASSIGNS.

 

1.92        “TENANT’S PERSONAL PROPERTY”  SHALL MEAN ALL MOTOR VEHICLES AND
CONSUMABLE INVENTORY AND SUPPLIES, FURNITURE, FURNISHINGS, EQUIPMENT, MOVABLE
WALLS AND PARTITIONS, EQUIPMENT AND MACHINERY AND ALL OTHER TANGIBLE PERSONAL
PROPERTY OF TENANT AND TENANT’S RECEIVABLES, IF ANY, ACQUIRED BY TENANT ON AND
AFTER THE APPLICABLE COMMENCEMENT DATE FOR ANY PROPERTY AND LOCATED AT SUCH
PROPERTY OR USED IN TENANT’S BUSINESS AT THE LEASED PROPERTY AND ALL
MODIFICATIONS, REPLACEMENTS, ALTERATIONS AND ADDITIONS TO SUCH PERSONAL PROPERTY
INSTALLED AT THE EXPENSE OF TENANT, OTHER THAN ANY ITEMS INCLUDED WITHIN THE
DEFINITION OF FIXTURES.

 

1.93        “TERM”  SHALL MEAN, COLLECTIVELY, THE FIXED TERM AND THE EXTENDED
TERM, TO THE EXTENT PROPERLY EXERCISED PURSUANT TO THE PROVISIONS OF
SECTION 2.4, UNLESS SOONER TERMINATED PURSUANT TO THE PROVISIONS OF THIS
AGREEMENT.

 

1.94        “THIRD PARTY PAYOR PROGRAMS”  SHALL MEAN ALL THIRD PARTY PAYOR
PROGRAMS IN WHICH TENANT PRESENTLY OR IN THE FUTURE MAY PARTICIPATE, INCLUDING,
WITHOUT LIMITATION, MEDICARE, MEDICAID, CHAMPUS, BLUE CROSS AND/OR BLUE SHIELD,
MANAGED CARE PLANS, OTHER PRIVATE INSURANCE PROGRAMS AND EMPLOYEE ASSISTANCE
PROGRAMS.

 

1.95        “THIRD PARTY PAYORS”  SHALL MEAN MEDICARE, MEDICAID, CHAMPUS, BLUE
CROSS AND/OR BLUE SHIELD, PRIVATE INSURERS AND ANY OTHER PERSON WHICH PRESENTLY
OR IN THE FUTURE MAINTAINS THIRD PARTY PAYOR PROGRAMS.

 

1.96        “UNSUITABLE FOR ITS PERMITTED USE”  SHALL MEAN, WITH RESPECT TO ANY
FACILITY, A STATE OR CONDITION OF SUCH FACILITY

 

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SUCH THAT (A) FOLLOWING ANY DAMAGE OR DESTRUCTION INVOLVING A FACILITY, (I) SUCH
FACILITY CANNOT BE OPERATED ON A COMMERCIALLY PRACTICABLE BASIS FOR ITS
PERMITTED USE AND IT CANNOT REASONABLY BE EXPECTED TO BE RESTORED TO
SUBSTANTIALLY THE SAME CONDITION AS EXISTED IMMEDIATELY BEFORE SUCH DAMAGE OR
DESTRUCTION, AND AS OTHERWISE REQUIRED BY SECTION 10.2.4, WITHIN TWELVE (12)
MONTHS FOLLOWING SUCH DAMAGE OR DESTRUCTION OR SUCH LONGER PERIOD OF TIME AS TO
WHICH BUSINESS INTERRUPTION INSURANCE IS AVAILABLE TO COVER RENT AND OTHER COSTS
RELATED TO THE APPLICABLE PROPERTY FOLLOWING SUCH DAMAGE OR DESTRUCTION,
(II) THE DAMAGE OR DESTRUCTION, IF UNINSURED, EXCEEDS $1,000,000 OR (III) THE
COST OF SUCH RESTORATION EXCEEDS TEN PERCENT (10%) OF THE FAIR MARKET VALUE OF
SUCH PROPERTY IMMEDIATELY PRIOR TO SUCH DAMAGE OR DESTRUCTION, OR (B) AS THE
RESULT OF A PARTIAL TAKING BY CONDEMNATION, SUCH FACILITY CANNOT BE OPERATED, IN
THE GOOD FAITH JUDGMENT OF TENANT, ON A COMMERCIALLY PRACTICABLE BASIS FOR ITS
PERMITTED USE.

 

1.97        “WORK”  SHALL HAVE THE MEANING GIVEN SUCH TERM IN SECTION 10.2.4.

 

ARTICLE 2

 

LEASED PROPERTY AND TERM

 

2.1          LEASED PROPERTY.  UPON AND SUBJECT TO THE TERMS AND CONDITIONS
HEREINAFTER SET FORTH, LANDLORD LEASES TO TENANT AND TENANT LEASES FROM LANDLORD
ALL OF LANDLORD’S RIGHT, TITLE AND INTEREST IN AND TO ALL OF THE FOLLOWING (EACH
OF ITEMS (A) THROUGH (G) BELOW WHICH RELATES TO ANY SINGLE FACILITY, A
“PROPERTY” AND, COLLECTIVELY, THE “LEASED PROPERTY”):

 

(A)           THOSE CERTAIN TRACTS, PIECES AND PARCELS OF LAND, AS MORE
PARTICULARLY DESCRIBED IN EXHIBITS A-1 THROUGH A-82 ATTACHED HERETO AND MADE A
PART HEREOF (THE “LAND”);

 

(B)           ALL BUILDINGS, STRUCTURES AND OTHER IMPROVEMENTS OF EVERY KIND
INCLUDING, BUT NOT LIMITED TO, ALLEYWAYS AND CONNECTING TUNNELS, SIDEWALKS,
UTILITY PIPES, CONDUITS AND LINES (ON-SITE AND OFF-SITE), PARKING AREAS AND
ROADWAYS APPURTENANT TO SUCH BUILDINGS AND STRUCTURES PRESENTLY SITUATED UPON
THE LAND (COLLECTIVELY, THE “LEASED IMPROVEMENTS”);

 

(C)           ALL EASEMENTS, RIGHTS AND APPURTENANCES RELATING TO THE LAND AND
THE LEASED IMPROVEMENTS;

 

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(D)           ALL EQUIPMENT, MACHINERY, FIXTURES, AND OTHER ITEMS OF PROPERTY,
NOW OR HEREAFTER PERMANENTLY AFFIXED TO OR INCORPORATED INTO THE LEASED
IMPROVEMENTS, INCLUDING, WITHOUT LIMITATION, ALL FURNACES, BOILERS, HEATERS,
ELECTRICAL EQUIPMENT, HEATING, PLUMBING, LIGHTING, VENTILATING, REFRIGERATING,
INCINERATION, AIR AND WATER POLLUTION CONTROL, WASTE DISPOSAL, AIR-COOLING AND
AIR-CONDITIONING SYSTEMS AND APPARATUS, SPRINKLER SYSTEMS AND FIRE AND THEFT
PROTECTION EQUIPMENT, ALL OF WHICH, TO THE MAXIMUM EXTENT PERMITTED BY LAW, ARE
HEREBY DEEMED BY THE PARTIES HERETO TO CONSTITUTE REAL ESTATE, TOGETHER WITH ALL
REPLACEMENTS, MODIFICATIONS, ALTERATIONS AND ADDITIONS THERETO, BUT SPECIFICALLY
EXCLUDING ALL ITEMS INCLUDED WITHIN THE CATEGORY OF TENANT’S PERSONAL PROPERTY
(COLLECTIVELY, THE “FIXTURES”);

 

(E)           ALL MACHINERY, EQUIPMENT, FURNITURE, FURNISHINGS, MOVEABLE WALLS
OR PARTITIONS, COMPUTERS OR TRADE FIXTURES OR OTHER PERSONAL PROPERTY OF ANY
KIND OR DESCRIPTION USED OR USEFUL IN TENANT’S BUSINESS ON OR IN THE LEASED
IMPROVEMENTS, AND LOCATED ON OR IN THE LEASED IMPROVEMENTS, AND ALL
MODIFICATIONS, REPLACEMENTS, ALTERATIONS AND ADDITIONS TO SUCH PERSONAL
PROPERTY, EXCEPT ITEMS, IF ANY, INCLUDED WITHIN THE CATEGORY OF FIXTURES, BUT
SPECIFICALLY EXCLUDING ALL ITEMS INCLUDED WITHIN THE CATEGORY OF TENANT’S
PERSONAL PROPERTY;

 

(F)            ALL OF THE LEASED INTANGIBLE PROPERTY; AND

 

(G)           ANY AND ALL LEASES OF SPACE IN THE LEASED IMPROVEMENTS.

 

2.2          CONDITION OF LEASED PROPERTY.  TENANT ACKNOWLEDGES RECEIPT AND
DELIVERY OF POSSESSION OF THE LEASED PROPERTY AND TENANT ACCEPTS THE LEASED
PROPERTY IN ITS “AS IS” CONDITION, SUBJECT TO THE RIGHTS OF PARTIES IN
POSSESSION, THE EXISTING STATE OF TITLE, INCLUDING ALL COVENANTS, CONDITIONS,
RESTRICTIONS, RESERVATIONS, MINERAL LEASES, EASEMENTS AND OTHER MATTERS OF
RECORD OR THAT ARE VISIBLE OR APPARENT ON THE LEASED  PROPERTY, ALL APPLICABLE
LEGAL REQUIREMENTS, THE LIEN OF ANY FINANCING INSTRUMENTS, MORTGAGES AND DEEDS
OF TRUST EXISTING PRIOR TO THE APPLICABLE COMMENCEMENT DATE FOR ANY PROPERTY OR
PERMITTED BY THE TERMS OF THIS AGREEMENT, AND SUCH OTHER MATTERS WHICH WOULD BE
DISCLOSED BY AN INSPECTION OF THE LEASED PROPERTY AND THE RECORD TITLE THERETO
OR BY AN ACCURATE SURVEY THEREOF.  TENANT REPRESENTS THAT IT HAS INSPECTED THE
LEASED PROPERTY AND ALL OF THE FOREGOING AND HAS FOUND THE CONDITION THEREOF
SATISFACTORY AND IS NOT RELYING ON ANY REPRESENTATION OR WARRANTY OF LANDLORD OR
LANDLORD’S AGENTS OR EMPLOYEES WITH

 

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RESPECT THERETO AND TENANT WAIVES ANY CLAIM OR ACTION AGAINST LANDLORD IN
RESPECT OF THE CONDITION OF THE LEASED PROPERTY.  LANDLORD MAKES NO WARRANTY OR
REPRESENTATION, EXPRESS OR IMPLIED, IN RESPECT OF THE LEASED PROPERTY OR ANY
PART THEREOF, EITHER AS TO ITS FITNESS FOR USE, DESIGN OR CONDITION FOR ANY
PARTICULAR USE OR PURPOSE OR OTHERWISE, AS TO THE QUALITY OF THE MATERIAL OR
WORKMANSHIP THEREIN, LATENT OR PATENT, IT BEING AGREED THAT ALL SUCH RISKS ARE
TO BE BORNE BY TENANT.  TO THE MAXIMUM EXTENT PERMITTED BY LAW, HOWEVER,
LANDLORD HEREBY ASSIGNS TO TENANT ALL OF LANDLORD’S RIGHTS TO PROCEED AGAINST
ANY PREDECESSOR IN INTEREST OR INSURER FOR BREACHES OF WARRANTIES OR
REPRESENTATIONS OR FOR LATENT DEFECTS IN THE LEASED PROPERTY.  LANDLORD SHALL
FULLY COOPERATE WITH TENANT IN THE PROSECUTION OF ANY SUCH CLAIMS, IN LANDLORD’S
OR TENANT’S NAME, ALL AT TENANT’S SOLE COST AND EXPENSE.  TENANT SHALL
INDEMNIFY, DEFEND, AND HOLD HARMLESS LANDLORD FROM AND AGAINST ANY LOSS, COST,
DAMAGE OR LIABILITY (INCLUDING REASONABLE ATTORNEYS’ FEES) INCURRED BY LANDLORD
IN CONNECTION WITH SUCH COOPERATION.

 

2.3          FIXED TERM.  THE INITIAL TERM OF THIS AGREEMENT (THE “FIXED TERM”)
WITH RESPECT TO EACH PROPERTY COMMENCED ON THE COMMENCEMENT DATE WITH RESPECT TO
SUCH PROPERTY AND SHALL EXPIRE ON DECEMBER 31, 2022.

 

2.4          EXTENDED TERMS.  PROVIDED THAT NO EVENT OF DEFAULT SHALL HAVE
OCCURRED AND BE CONTINUING, TENANT SHALL HAVE THE RIGHT TO EXTEND THE TERM FOR
ONE RENEWAL TERM OF FIFTEEN (15) YEARS (THE “EXTENDED TERM”).

 

The Extended Term shall commence on the day succeeding the expiration of the
Fixed Term.  All of the terms, covenants and provisions of this Agreement shall
apply to the Extended Term, except that Tenant shall have no right to extend the
Term beyond the expiration of the Extended Term.  If Tenant shall elect to
exercise the aforesaid option, it shall do so by giving Landlord Notice thereof
not later than December 31, 2020, it being understood and agreed that time shall
be of the essence with respect to the giving of such Notice.  If Tenant shall
fail to give such Notice, this Agreement shall automatically terminate at the
end of the Fixed Term and Tenant shall have no further option to extend the Term
of this Agreement.  If Tenant shall give such Notice, the extension of this
Agreement shall be automatically effected without the execution of any
additional documents; it being understood and agreed, however, that Tenant and
Landlord shall execute such documents and agreements as either party shall
reasonably require to evidence the same.  Notwithstanding the provisions of the
foregoing sentence, if, subsequent to the giving of such Notice, an Event of
Default

 

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shall occur, at Landlord’s option, the extension of this Agreement shall cease
to take effect and this Agreement shall automatically terminate at the end of
the Fixed Term, and Tenant shall have no further option to extend the Term of
this Agreement.

 

ARTICLE 3

 

RENT

 

3.1          RENT.  TENANT SHALL PAY, IN LAWFUL MONEY OF THE UNITED STATES OF
AMERICA WHICH SHALL BE LEGAL TENDER FOR THE PAYMENT OF PUBLIC AND PRIVATE DEBTS,
WITHOUT OFFSET, ABATEMENT, DEMAND OR DEDUCTION (UNLESS OTHERWISE EXPRESSLY
PROVIDED IN THIS AGREEMENT), MINIMUM RENT AND ADDITIONAL RENT TO LANDLORD AND
ADDITIONAL CHARGES TO THE PARTY TO WHOM SUCH ADDITIONAL CHARGES ARE PAYABLE,
DURING THE TERM.  ALL PAYMENTS TO LANDLORD SHALL BE MADE BY WIRE TRANSFER OF
IMMEDIATELY AVAILABLE FEDERAL FUNDS OR BY OTHER MEANS ACCEPTABLE TO LANDLORD IN
ITS SOLE DISCRETION.  RENT FOR ANY PARTIAL CALENDAR MONTH SHALL BE PRORATED ON A
PER DIEM BASIS.

 

3.1.1           MINIMUM RENT.

 

(A)           PAYMENTS.  MINIMUM RENT SHALL BE PAID IN EQUAL MONTHLY
INSTALLMENTS IN ARREARS ON THE FIRST BUSINESS DAY OF EACH CALENDAR MONTH DURING
THE TERM.

 

(B)           ALLOCATION OF MINIMUM RENT.  MINIMUM RENT MAY BE ALLOCATED AND
REALLOCATED AMONG THE PROPERTIES COMPRISING THE LEASED PROPERTY BY AGREEMENT
AMONG LANDLORD AND TENANT; PROVIDED, HOWEVER THAT IN NO EVENT SHALL THE MINIMUM
RENT ALLOCATED TO ANY PROPERTY BE LESS THAN THE MONTHLY AMOUNT PAYABLE BY
LANDLORD ON ACCOUNT OF ANY FACILITY MORTGAGE AND/OR GROUND OR MASTER LEASE WITH
RESPECT TO SUCH PROPERTY NOR SHALL THE AGGREGATE AMOUNT OF MINIMUM RENT
ALLOCATED AMONG THE PROPERTIES EXCEED THE TOTAL AMOUNT PAYABLE FOR THE LEASED
PROPERTY.

 

(C)           ADJUSTMENTS OF MINIMUM RENT FOLLOWING DISBURSEMENTS UNDER SECTIONS
5.1.2(B), 10.2.3 AND 11.2.  EFFECTIVE ON THE DATE OF EACH DISBURSEMENT TO PAY
FOR THE COST OF ANY REPAIRS, MAINTENANCE, RENOVATIONS OR REPLACEMENTS PURSUANT
TO SECTIONS 5.1.2(B), 10.2.3 OR 11.2, THE ANNUAL MINIMUM RENT SHALL BE INCREASED
BY A PER ANNUM AMOUNT EQUAL TO THE DISBURSEMENT RATE TIMES THE AMOUNT SO
DISBURSED.  IF ANY SUCH DISBURSEMENT IS MADE DURING ANY CALENDAR MONTH ON A DAY
OTHER THAN THE FIRST BUSINESS DAY OF SUCH CALENDAR MONTH, TENANT SHALL PAY TO
LANDLORD ON THE

 

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FIRST BUSINESS DAY OF THE IMMEDIATELY FOLLOWING CALENDAR MONTH (IN ADDITION TO
THE AMOUNT OF MINIMUM RENT PAYABLE WITH RESPECT TO SUCH CALENDAR MONTH, AS
ADJUSTED PURSUANT TO THIS PARAGRAPH (C)) THE AMOUNT BY WHICH MINIMUM RENT FOR
THE PRECEDING CALENDAR MONTH, AS ADJUSTED FOR SUCH DISBURSEMENT ON A PER DIEM
BASIS, EXCEEDED THE AMOUNT OF MINIMUM RENT PAID BY TENANT FOR SUCH PRECEDING
CALENDAR MONTH.

 

(D)           ADJUSTMENTS OF MINIMUM RENT FOLLOWING PARTIAL LEASE TERMINATION. 
SUBJECT TO SECTION 4.1.1(B), IF THIS AGREEMENT SHALL TERMINATE WITH RESPECT TO
ANY PROPERTY BUT LESS THAN ALL OF THE LEASED PROPERTY, MINIMUM RENT SHALL BE
REDUCED BY THE AFFECTED PROPERTY’S ALLOCABLE SHARE OF MINIMUM RENT DETERMINED IN
ACCORDANCE WITH THE APPLICABLE PROVISIONS OF THIS AGREEMENT.

 

3.1.2           ADDITIONAL RENT.

 

(A)           AMOUNT.  TENANT SHALL PAY ADDITIONAL RENT (“ADDITIONAL RENT”) WITH
RESPECT TO EACH LEASE YEAR DURING THE TERM SUBSEQUENT TO THE BASE YEAR IN AN
AMOUNT, NOT LESS THAN ZERO, EQUAL TO FOUR PERCENT (4%) OF EXCESS GROSS REVENUES
AT THE LEASED PROPERTY.

 

(B)           QUARTERLY INSTALLMENTS.  INSTALLMENTS OF ADDITIONAL RENT FOR EACH
LEASE YEAR DURING THE TERM, OR PORTION THEREOF, SHALL BE CALCULATED AND PAID
QUARTERLY IN ARREARS.  QUARTERLY PAYMENTS OF ADDITIONAL RENT FOR THE LEASED
PROPERTY SHALL BE CALCULATED BASED ON GROSS REVENUES FOR SUCH QUARTER DURING THE
PRECEDING YEAR AND SHALL BE DUE AND PAYABLE AND DELIVERED TO LANDLORD ON THE
FIRST BUSINESS DAY OF EACH CALENDAR QUARTER, OR PORTION THEREOF, THEREAFTER
OCCURRING DURING THE TERM, TOGETHER WITH AN OFFICER’S CERTIFICATE SETTING FORTH
THE CALCULATION OF ADDITIONAL RENT DUE AND PAYABLE FOR SUCH QUARTER.  AMOUNTS
PAID UNDER THE LTA GMAC LEASES SHALL BE CREDITED AGAINST AMOUNTS DUE HEREUNDER.

 

(C)           RECONCILIATION OF ADDITIONAL RENT.  IN ADDITION, WITHIN
SEVENTY-FIVE (75) DAYS AFTER THE END OF THE BASE YEAR AND EACH LEASE YEAR
THEREAFTER (OR ANY PORTION THEREOF OCCURRING DURING THE TERM), TENANT SHALL
DELIVER, OR CAUSE TO BE DELIVERED, TO LANDLORD (I) A FINANCIAL REPORT SETTING
FORTH THE GROSS REVENUES FOR EACH PROPERTY FOR SUCH PRECEDING LEASE YEAR, OR
PORTION THEREOF, TOGETHER WITH AN OFFICER’S CERTIFICATE FROM TENANT’S CHIEF
FINANCIAL OR ACCOUNTING OFFICER CERTIFYING THAT SUCH REPORT IS TRUE AND CORRECT,
(II) AN AUDIT OF GROSS REVENUES PREPARED BY A FIRM

 

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OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS PROPOSED BY TENANT AND APPROVED BY
LANDLORD (WHICH APPROVAL SHALL NOT BE UNREASONABLY WITHHELD, DELAYED OR
CONDITIONED), AND (III) A STATEMENT SHOWING TENANT’S CALCULATION OF ADDITIONAL
RENT DUE FOR SUCH PRECEDING LEASE YEAR BASED ON THE GROSS REVENUES SET FORTH IN
SUCH FINANCIAL REPORT, TOGETHER WITH AN OFFICER’S CERTIFICATE FROM TENANT’S
CHIEF FINANCIAL OR ACCOUNTING OFFICER CERTIFYING THAT SUCH STATEMENT IS TRUE AND
CORRECT.

 

If the annual Additional Rent for such preceding Lease Year as set forth in
Tenant’s statement thereof exceeds the amount previously paid with respect
thereto by Tenant, Tenant shall pay such excess to Landlord at such time as the
statement is delivered, together with interest at the Interest Rate, which
interest shall accrue from the close of such preceding Lease Year until the date
that such statement is required to be delivered and, thereafter, such interest
shall accrue at the Overdue Rate, until the amount of such difference shall be
paid or otherwise discharged.  If the annual Additional Rent for such preceding
Lease Year as shown in such statement is less than the amount previously paid
with respect thereto by Tenant, provided that no Event of Default shall have
occurred and be continuing, Landlord shall grant Tenant a credit against the
Additional Rent next coming due in the amount of such difference, together with
interest at the Interest Rate, which interest shall accrue from the date of
payment by Tenant until the date such credit is applied or paid, as the case may
be.  If such credit cannot be made because the Term has expired prior to
application in full thereof, provided no Event of Default has occurred and is
continuing, Landlord shall pay the unapplied balance of such credit to Tenant,
together with interest at the Interest Rate, which interest shall accrue from
the date of payment by Tenant until the date of payment by Landlord.

 

(D)           CONFIRMATION OF ADDITIONAL RENT.  TENANT SHALL UTILIZE, OR CAUSE
TO BE UTILIZED, AN ACCOUNTING SYSTEM FOR THE LEASED PROPERTY IN ACCORDANCE WITH
ITS USUAL AND CUSTOMARY PRACTICES AND IN ALL MATERIAL RESPECTS IN ACCORDANCE
WITH GAAP, WHICH WILL ACCURATELY RECORD ALL GROSS REVENUES AND TENANT SHALL
RETAIN, FOR AT LEAST THREE (3) YEARS AFTER THE EXPIRATION OF EACH LEASE YEAR,
REASONABLY ADEQUATE RECORDS CONFORMING TO SUCH ACCOUNTING SYSTEM SHOWING ALL
GROSS REVENUES FOR SUCH LEASE YEAR.  LANDLORD, AT ITS OWN EXPENSE, EXCEPT AS
PROVIDED HEREINBELOW, SHALL HAVE THE RIGHT, EXERCISABLE BY NOTICE TO

 

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TENANT, BY ITS ACCOUNTANTS OR REPRESENTATIVES, TO AUDIT THE INFORMATION SET
FORTH IN THE OFFICER’S CERTIFICATE REFERRED TO IN SUBPARAGRAPH (C) ABOVE AND, IN
CONNECTION WITH SUCH AUDITS, TO EXAMINE TENANT’S BOOKS AND RECORDS WITH RESPECT
THERETO (INCLUDING SUPPORTING DATA AND SALES AND EXCISE TAX RETURNS).  LANDLORD
SHALL BEGIN SUCH AUDIT AS SOON AS REASONABLY POSSIBLE FOLLOWING ITS RECEIPT OF
THE APPLICABLE OFFICER’S CERTIFICATE AND SHALL COMPLETE SUCH AUDIT AS SOON AS
REASONABLY POSSIBLE THEREAFTER.  ALL SUCH AUDITS SHALL BE PERFORMED AT THE
LOCATION WHERE SUCH BOOKS AND RECORDS ARE CUSTOMARILY KEPT AND IN SUCH A MANNER
SO AS TO MINIMIZE ANY INTERFERENCE WITH TENANT’S BUSINESS OPERATIONS.  IF ANY
SUCH AUDIT DISCLOSES A DEFICIENCY IN THE PAYMENT OF ADDITIONAL RENT AND EITHER
TENANT AGREES WITH THE RESULT OF SUCH AUDIT OR THE MATTER IS OTHERWISE
DETERMINED, TENANT SHALL FORTHWITH PAY TO LANDLORD THE AMOUNT OF THE DEFICIENCY,
AS FINALLY AGREED OR DETERMINED, TOGETHER WITH INTEREST AT THE INTEREST RATE,
FROM THE DATE SUCH PAYMENT SHOULD HAVE BEEN MADE TO THE DATE OF PAYMENT THEREOF,
AND IF THE AMOUNT OF SUCH DEFICIENCY EXCEEDS FIVE PERCENT (5%) OF THE ADDITIONAL
RENT THAT SHOULD HAVE BEEN PAID FOR ANY LEASE YEAR, TENANT SHALL FORTHWITH PAY
TO LANDLORD THE AGGREGATE AMOUNT OF ALL COSTS AND EXPENSES INCURRED BY LANDLORD
IN CONNECTION WITH ANY SUCH AUDIT.  IF ANY SUCH AUDIT DISCLOSES THAT TENANT PAID
MORE ADDITIONAL RENT FOR ANY LEASE YEAR THAN WAS DUE HEREUNDER, AND EITHER
LANDLORD AGREES WITH THE RESULT OF SUCH AUDIT OR THE MATTER IS OTHERWISE
DETERMINED, PROVIDED NO EVENT OF DEFAULT HAS OCCURRED AND IS CONTINUING,
LANDLORD SHALL, AT LANDLORD’S OPTION, EITHER GRANT TENANT A CREDIT OR PAY TO
TENANT AN AMOUNT EQUAL TO THE AMOUNT OF SUCH OVERPAYMENT AGAINST ADDITIONAL RENT
NEXT COMING DUE IN THE AMOUNT OF SUCH DIFFERENCE, AS FINALLY AGREED OR
DETERMINED, TOGETHER WITH INTEREST AT THE INTEREST RATE, WHICH INTEREST SHALL
ACCRUE FROM THE TIME OF PAYMENT BY TENANT UNTIL THE DATE SUCH CREDIT IS APPLIED
OR PAID, AS THE CASE MAY BE; PROVIDED, HOWEVER, THAT, UPON THE EXPIRATION OR
SOONER TERMINATION OF THE TERM, PROVIDED NO EVENT OF DEFAULT HAS OCCURRED AND IS
CONTINUING, LANDLORD SHALL PAY THE UNAPPLIED BALANCE OF SUCH CREDIT TO TENANT,
TOGETHER WITH INTEREST AT THE INTEREST RATE, WHICH INTEREST SHALL ACCRUE FROM
THE DATE OF PAYMENT BY TENANT UNTIL THE DATE OF PAYMENT FROM LANDLORD.  ANY
DISPUTE CONCERNING THE CORRECTNESS OF AN AUDIT SHALL BE SETTLED BY ARBITRATION
PURSUANT TO THE PROVISIONS OF ARTICLE 22.

 

Any proprietary information obtained by Landlord with respect to Tenant pursuant
to the provisions of this

 

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Agreement shall be treated as confidential, except that such information may be
disclosed or used, subject to appropriate confidentiality safeguards, pursuant
to court order or in any litigation between the parties and except further that
Landlord may disclose such information to its prospective lenders, provided that
Landlord shall direct such lenders to maintain such information as
confidential.  The obligations of Tenant and Landlord contained in this
Section 3.1.2 shall survive the expiration or earlier termination of this
Agreement.

 

3.1.3       ADDITIONAL CHARGES.  IN ADDITION TO THE MINIMUM RENT AND ADDITIONAL
RENT PAYABLE HEREUNDER, TENANT SHALL PAY (OR CAUSE TO BE PAID) TO THE
APPROPRIATE PARTIES AND DISCHARGE (OR CAUSE TO BE DISCHARGED) AS AND WHEN DUE
AND PAYABLE THE FOLLOWING (COLLECTIVELY, “ADDITIONAL CHARGES”):

 

(A)           IMPOSITIONS.  SUBJECT TO ARTICLE 8 RELATING TO PERMITTED CONTESTS,
TENANT SHALL PAY, OR CAUSE TO BE PAID, ALL IMPOSITIONS BEFORE ANY FINE, PENALTY,
INTEREST OR COST (OTHER THAN ANY OPPORTUNITY COST AS A RESULT OF A FAILURE TO
TAKE ADVANTAGE OF ANY DISCOUNT FOR EARLY PAYMENT) MAY BE ADDED FOR NON-PAYMENT,
SUCH PAYMENTS TO BE MADE DIRECTLY TO THE TAXING AUTHORITIES WHERE FEASIBLE, AND
SHALL PROMPTLY, UPON REQUEST, FURNISH TO LANDLORD COPIES OF OFFICIAL RECEIPTS OR
OTHER REASONABLY SATISFACTORY PROOF EVIDENCING SUCH PAYMENTS.  IF ANY SUCH
IMPOSITION MAY, AT THE OPTION OF THE TAXPAYER, LAWFULLY BE PAID IN INSTALLMENTS
(WHETHER OR NOT INTEREST SHALL ACCRUE ON THE UNPAID BALANCE OF SUCH IMPOSITION),
TENANT MAY EXERCISE THE OPTION TO PAY THE SAME (AND ANY ACCRUED INTEREST ON THE
UNPAID BALANCE OF SUCH IMPOSITION) IN INSTALLMENTS AND, IN SUCH EVENT, SHALL
PAY, OR CAUSE TO PAY, SUCH INSTALLMENTS DURING THE TERM AS THE SAME BECOME DUE
AND BEFORE ANY FINE, PENALTY, PREMIUM, FURTHER INTEREST OR COST MAY BE ADDED
THERETO.  LANDLORD, AT ITS EXPENSE, SHALL, TO THE EXTENT REQUIRED OR PERMITTED
BY APPLICABLE LAW, PREPARE AND FILE, OR CAUSE TO BE PREPARED AND FILED, ALL TAX
RETURNS AND PAY ALL TAXES DUE IN RESPECT OF LANDLORD’S NET INCOME, GROSS
RECEIPTS, SALES AND USE, SINGLE BUSINESS, TRANSACTION PRIVILEGE, RENT, AD
VALOREM, FRANCHISE TAXES AND TAXES ON ITS CAPITAL STOCK OR OTHER EQUITY
INTERESTS, AND TENANT, AT ITS EXPENSE, SHALL, TO THE EXTENT REQUIRED OR
PERMITTED BY APPLICABLE LAWS AND REGULATIONS, PREPARE AND FILE ALL OTHER TAX
RETURNS AND REPORTS IN RESPECT OF ANY IMPOSITION AS MAY BE REQUIRED BY
GOVERNMENT AGENCIES.  PROVIDED NO EVENT OF DEFAULT SHALL HAVE OCCURRED AND BE
CONTINUING, IF ANY REFUND SHALL BE DUE FROM ANY TAXING AUTHORITY IN RESPECT OF
ANY IMPOSITION PAID

 

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by or on behalf of Tenant, the same shall be paid over to or retained by
Tenant.  Landlord and Tenant shall, upon request of the other, provide such data
as is maintained by the party to whom the request is made with respect to the
Leased Property as may be necessary to prepare any required returns and
reports.  In the event Government Agencies classify any property covered by this
Agreement as personal property, Tenant shall file, or cause to be filed, all
personal property tax returns in such jurisdictions where it may legally so
file.  Each party shall, to the extent it possesses the same, provide the other,
upon request, with cost and depreciation records necessary for filing returns
for any property so classified as personal property.  Where Landlord is legally
required to file personal property tax returns for property covered by this
Agreement, Landlord shall provide Tenant with copies of assessment notices in
sufficient time for Tenant to file a protest.  All Impositions assessed against
such personal property shall be (irrespective of whether Landlord or Tenant
shall file the relevant return) paid by Tenant not later than the last date on
which the same may be made without interest or penalty, subject to the
provisions of Article 8.

 

Landlord shall give prompt Notice to Tenant of all Impositions payable by Tenant
hereunder of which Landlord at any time has knowledge; provided, however, that
Landlord’s failure to give any such notice shall in no way diminish Tenant’s
obligation hereunder to pay such Impositions.

 

Reference is made to that certain Development Agreement, dated as of 2003,
between the City of Rogers, Minnesota (the “City of Rogers”) and SNH CHS
Properties Trust, as successor by assignment from Dignified Assisted Living,
Inc. (the “Development Agreement”).  Notwithstanding anything contained in this
Agreement to the contrary, the Impositions payable by Tenant hereunder shall not
include any of the Tax Increments described in the Development Agreement.  So
long as the Development Agreement remains outstanding, (i) SNH CHS Properties
Trust shall pay all of the Tax Increments directly to the City of Rogers under
the Development Agreement; (ii) SNH CHS Properties Trust shall be entitled to
receive any portion of the Reimbursement Amount (as described in the Development
Agreement) paid by the City of Rogers under the Development Agreement, and (iii)
Tenant shall pay to Landlord the fixed amount of $15,000 per year.

 

(B)           UTILITY CHARGES.  TENANT SHALL PAY OR CAUSE TO BE PAID ALL CHARGES
FOR ELECTRICITY, POWER, GAS, OIL, WATER AND OTHER UTILITIES USED IN CONNECTION
WITH THE LEASED PROPERTY.

 

(C)           INSURANCE PREMIUMS.  TENANT SHALL PAY OR CAUSE TO BE PAID ALL
PREMIUMS FOR THE INSURANCE COVERAGE REQUIRED TO BE MAINTAINED PURSUANT TO
ARTICLE 9.

 

(D)           OTHER CHARGES.  TENANT SHALL PAY OR CAUSE TO BE PAID ALL OTHER
AMOUNTS, LIABILITIES AND OBLIGATIONS, INCLUDING, WITHOUT LIMITATION, GROUND
RENTS, IF ANY, AND ALL AMOUNTS PAYABLE UNDER ANY EQUIPMENT LEASES AND ALL
AGREEMENTS TO INDEMNIFY LANDLORD UNDER SECTIONS 4.4.2 AND 9.5.

 

(E)           REIMBURSEMENT FOR ADDITIONAL CHARGES.  IF TENANT PAYS OR CAUSES TO
BE PAID PROPERTY TAXES OR SIMILAR OR OTHER ADDITIONAL CHARGES ATTRIBUTABLE TO
PERIODS AFTER THE

 

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END OF THE TERM, WHETHER UPON EXPIRATION OR SOONER TERMINATION OF THIS AGREEMENT
(OTHER THAN TERMINATION BY REASON OF AN EVENT OF DEFAULT), TENANT MAY, WITHIN A
REASONABLE TIME AFTER THE END OF THE TERM, PROVIDE NOTICE TO LANDLORD OF ITS
ESTIMATE OF SUCH AMOUNTS.  LANDLORD SHALL PROMPTLY REIMBURSE TENANT FOR ALL
PAYMENTS OF SUCH TAXES AND OTHER SIMILAR ADDITIONAL CHARGES THAT ARE
ATTRIBUTABLE TO ANY PERIOD AFTER THE TERM OF THIS AGREEMENT.

 

3.2          LATE PAYMENT OF RENT, ETC.  IF ANY INSTALLMENT OF MINIMUM RENT,
ADDITIONAL RENT OR ADDITIONAL CHARGES (BUT ONLY AS TO THOSE ADDITIONAL CHARGES
WHICH ARE PAYABLE DIRECTLY TO LANDLORD) SHALL NOT BE PAID WITHIN TEN (10) DAYS
AFTER ITS DUE DATE, TENANT SHALL PAY LANDLORD, ON DEMAND, AS ADDITIONAL CHARGES,
A LATE CHARGE (TO THE EXTENT PERMITTED BY LAW) COMPUTED AT THE OVERDUE RATE ON
THE AMOUNT OF SUCH INSTALLMENT, FROM THE DUE DATE OF SUCH INSTALLMENT TO THE
DATE OF PAYMENT THEREOF. TO THE EXTENT THAT TENANT PAYS ANY ADDITIONAL CHARGES
DIRECTLY TO LANDLORD OR ANY FACILITY MORTGAGEE PURSUANT TO ANY REQUIREMENT OF
THIS AGREEMENT, TENANT SHALL BE RELIEVED OF ITS OBLIGATION TO PAY SUCH
ADDITIONAL CHARGES TO THE ENTITY TO WHICH THEY WOULD OTHERWISE BE DUE.  IF ANY
PAYMENTS DUE FROM LANDLORD TO TENANT SHALL NOT BE PAID WITHIN TEN (10) DAYS
AFTER ITS DUE DATE, LANDLORD SHALL PAY TO TENANT, ON DEMAND, A LATE CHARGE (TO
THE EXTENT PERMITTED BY LAW) COMPUTED AT THE OVERDUE RATE ON THE AMOUNT OF SUCH
INSTALLMENT FROM THE DUE DATE OF SUCH INSTALLMENT TO THE DATE OF PAYMENT
THEREOF.

 

In the event of any failure by Tenant to pay any Additional Charges when due,
Tenant shall promptly pay and discharge, as Additional Charges, every fine,
penalty, interest and cost which is added for non-payment or late payment of
such items.  Landlord shall have all legal, equitable and contractual rights,
powers and remedies provided either in this Agreement or by statute or otherwise
in the case of non-payment of the Additional Charges as in the case of
non-payment of the Minimum Rent and Additional Rent.

 

3.3          NET LEASE.  THE RENT SHALL BE ABSOLUTELY NET TO LANDLORD SO THAT
THIS AGREEMENT SHALL YIELD TO LANDLORD THE FULL AMOUNT OF THE INSTALLMENTS OR
AMOUNTS OF THE RENT THROUGHOUT THE TERM, SUBJECT TO ANY OTHER PROVISIONS OF THIS
AGREEMENT WHICH EXPRESSLY PROVIDE OTHERWISE, INCLUDING THOSE PROVISIONS FOR
ADJUSTMENT OR ABATEMENT OF SUCH RENT.

 

3.4          NO TERMINATION, ABATEMENT, ETC.   EXCEPT AS OTHERWISE SPECIFICALLY
PROVIDED IN THIS AGREEMENT, EACH OF LANDLORD AND TENANT, TO THE MAXIMUM EXTENT
PERMITTED BY LAW, SHALL REMAIN

 

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BOUND BY THIS AGREEMENT IN ACCORDANCE WITH ITS TERMS AND SHALL NOT TAKE ANY
ACTION WITHOUT THE CONSENT OF THE OTHER TO MODIFY, SURRENDER OR TERMINATE THIS
AGREEMENT.  IN ADDITION, EXCEPT AS OTHERWISE EXPRESSLY PROVIDED IN THIS
AGREEMENT, TENANT SHALL NOT SEEK, OR BE ENTITLED TO, ANY ABATEMENT, DEDUCTION,
DEFERMENT OR REDUCTION OF THE RENT, OR SET-OFF AGAINST THE RENT, NOR SHALL THE
RESPECTIVE OBLIGATIONS OF LANDLORD AND TENANT BE OTHERWISE AFFECTED BY REASON OF
(A) ANY DAMAGE TO OR DESTRUCTION OF THE LEASED PROPERTY, OR ANY PORTION THEREOF,
FROM WHATEVER CAUSE OR ANY CONDEMNATION, (B) THE LAWFUL OR UNLAWFUL PROHIBITION
OF, OR RESTRICTION UPON, TENANT’S USE OF THE LEASED PROPERTY, OR ANY PORTION
THEREOF, OR THE INTERFERENCE WITH SUCH USE BY ANY PERSON OR BY REASON OF
EVICTION BY PARAMOUNT TITLE; (C) ANY CLAIM WHICH TENANT MAY HAVE AGAINST
LANDLORD BY REASON OF ANY DEFAULT (OTHER THAN A MONETARY DEFAULT) OR BREACH OF
ANY WARRANTY BY LANDLORD UNDER THIS AGREEMENT OR ANY OTHER AGREEMENT BETWEEN
LANDLORD AND TENANT, OR TO WHICH LANDLORD AND TENANT ARE PARTIES; (D) ANY
BANKRUPTCY, INSOLVENCY, REORGANIZATION, COMPOSITION, READJUSTMENT, LIQUIDATION,
DISSOLUTION, WINDING UP OR OTHER PROCEEDINGS AFFECTING LANDLORD OR ANY ASSIGNEE
OR TRANSFEREE OF LANDLORD; OR (E) FOR ANY OTHER CAUSE WHETHER SIMILAR OR
DISSIMILAR TO ANY OF THE FOREGOING (OTHER THAN A MONETARY DEFAULT BY LANDLORD). 
EXCEPT AS OTHERWISE SPECIFICALLY PROVIDED IN THIS AGREEMENT, TENANT HEREBY
WAIVES ALL RIGHTS ARISING FROM ANY OCCURRENCE WHATSOEVER, WHICH MAY NOW OR
HEREAFTER BE CONFERRED UPON IT BY LAW (A) TO MODIFY, SURRENDER OR TERMINATE THIS
AGREEMENT OR QUIT OR SURRENDER THE LEASED PROPERTY, OR ANY PORTION THEREOF, OR
(B) WHICH WOULD ENTITLE TENANT TO ANY ABATEMENT, REDUCTION, SUSPENSION OR
DEFERMENT OF THE RENT OR OTHER SUMS PAYABLE OR OTHER OBLIGATIONS TO BE PERFORMED
BY TENANT HEREUNDER.  THE OBLIGATIONS OF TENANT HEREUNDER SHALL BE SEPARATE AND
INDEPENDENT COVENANTS AND AGREEMENTS, AND THE RENT AND ALL OTHER SUMS PAYABLE BY
TENANT HEREUNDER SHALL CONTINUE TO BE PAYABLE IN ALL EVENTS UNLESS THE
OBLIGATIONS TO PAY THE SAME SHALL BE TERMINATED PURSUANT TO THE EXPRESS
PROVISIONS OF THIS AGREEMENT.

 

ARTICLE 4

 

USE OF THE LEASED PROPERTY

 

4.1          PERMITTED USE.

 

4.1.1           PERMITTED USE.

 

(A)           TENANT SHALL, AT ALL TIMES DURING THE TERM, AND AT ANY OTHER TIME
THAT TENANT SHALL BE IN POSSESSION OF ANY PROPERTY, CONTINUOUSLY USE AND
OPERATE, OR CAUSE TO BE USED AND OPERATED, SUCH PROPERTY AS A SKILLED NURSING/

 

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INTERMEDIATE CARE/INDEPENDENT LIVING/ASSISTED LIVING/ SPECIAL CARE/GROUP HOME
FACILITY AS CURRENTLY OPERATED, AND ANY USES INCIDENTAL THERETO.  TENANT SHALL
NOT USE (AND SHALL NOT PERMIT ANY PERSON TO USE) ANY PROPERTY, OR ANY PORTION
THEREOF, FOR ANY OTHER USE WITHOUT THE PRIOR WRITTEN CONSENT OF LANDLORD, WHICH
APPROVAL SHALL NOT BE UNREASONABLY WITHHELD, DELAYED OR CONDITIONED.  NO USE
SHALL BE MADE OR PERMITTED TO BE MADE OF ANY PROPERTY AND NO ACTS SHALL BE DONE
THEREON WHICH WILL CAUSE THE CANCELLATION OF ANY INSURANCE POLICY COVERING SUCH
PROPERTY OR ANY PART THEREOF (UNLESS ANOTHER ADEQUATE POLICY IS AVAILABLE) OR
WHICH WOULD CONSTITUTE A DEFAULT UNDER ANY GROUND LEASE AFFECTING SUCH PROPERTY,
NOR SHALL TENANT SELL OR OTHERWISE PROVIDE TO RESIDENTS OR PATIENTS THEREIN, OR
PERMIT TO BE KEPT, USED OR SOLD IN OR ABOUT ANY PROPERTY ANY ARTICLE WHICH MAY
BE PROHIBITED BY LAW OR BY THE STANDARD FORM OF FIRE INSURANCE POLICIES, OR ANY
OTHER INSURANCE POLICIES REQUIRED TO BE CARRIED HEREUNDER, OR FIRE UNDERWRITER’S
REGULATIONS.  TENANT SHALL, AT ITS SOLE COST (EXCEPT AS EXPRESSLY PROVIDED IN
SECTION 5.1.2(B)), COMPLY OR CAUSE TO BE COMPLIED WITH ALL INSURANCE
REQUIREMENTS.  TENANT SHALL NOT TAKE OR OMIT TO TAKE, OR PERMIT TO BE TAKEN OR
OMITTED TO BE TAKEN, ANY ACTION, THE TAKING OR OMISSION OF WHICH MATERIALLY
IMPAIRS THE VALUE OR THE USEFULNESS OF ANY PROPERTY OR ANY PART THEREOF FOR ITS
PERMITTED USE.

 

(B)           IN THE EVENT THAT, IN THE REASONABLE DETERMINATION OF TENANT, IT
SHALL NO LONGER BE ECONOMICALLY PRACTICAL TO OPERATE ANY PROPERTY AS CURRENTLY
OPERATED, TENANT SHALL GIVE LANDLORD NOTICE THEREOF, WHICH NOTICE SHALL SET
FORTH IN REASONABLE DETAIL THE REASONS THEREFOR.  THEREAFTER, LANDLORD AND
TENANT SHALL NEGOTIATE IN GOOD FAITH TO AGREE ON AN ALTERNATIVE USE FOR SUCH
PROPERTY, APPROPRIATE ADJUSTMENTS TO THE ADDITIONAL RENT AND OTHER RELATED
MATTERS; PROVIDED, HOWEVER, IN NO EVENT SHALL THE MINIMUM RENT BE REDUCED OR
ABATED AS A RESULT THEREOF.  IF LANDLORD AND TENANT FAIL TO AGREE ON AN
ALTERNATIVE USE FOR SUCH PROPERTY WITHIN SIXTY (60) DAYS AFTER COMMENCING
NEGOTIATIONS AS AFORESAID, TENANT MAY MARKET SUCH PROPERTY FOR SALE TO A THIRD
PARTY.  IF TENANT RECEIVES A BONA FIDE OFFER (AN “OFFER”) TO PURCHASE SUCH
PROPERTY FROM A PERSON HAVING THE FINANCIAL CAPACITY TO IMPLEMENT THE TERMS OF
SUCH OFFER, TENANT SHALL GIVE LANDLORD NOTICE THEREOF, WHICH NOTICE SHALL
INCLUDE A COPY OF THE OFFER EXECUTED BY SUCH THIRD PARTY.  IN THE EVENT THAT
LANDLORD SHALL FAIL TO ACCEPT OR REJECT SUCH OFFER WITHIN THIRTY (30) DAYS AFTER
RECEIPT OF SUCH NOTICE, SUCH OFFER SHALL BE DEEMED TO BE

 

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REJECTED BY LANDLORD.  IF LANDLORD SHALL SELL THE PROPERTY PURSUANT TO SUCH
OFFER, THEN, EFFECTIVE AS OF THE DATE OF SUCH SALE, THIS AGREEMENT SHALL
TERMINATE WITH RESPECT TO SUCH PROPERTY, AND THE MINIMUM RENT SHALL BE REDUCED
BY AN AMOUNT EQUAL TO THE PRODUCT OF THE NET PROCEEDS OF SALE RECEIVED BY
LANDLORD MULTIPLIED BY THE INTEREST RATE.  IF LANDLORD SHALL REJECT (OR BE
DEEMED TO HAVE REJECTED) SUCH OFFER, THEN, EFFECTIVE AS OF THE PROPOSED DATE OF
SUCH SALE, THIS AGREEMENT SHALL TERMINATE WITH RESPECT TO SUCH PROPERTY, AND THE
MINIMUM RENT SHALL BE REDUCED BY AN AMOUNT EQUAL TO THE PRODUCT OF THE PROJECTED
NET PROCEEDS DETERMINED BY REFERENCE TO SUCH OFFER MULTIPLIED BY THE INTEREST
RATE.

 

4.1.2           NECESSARY APPROVALS.  TENANT SHALL PROCEED WITH ALL DUE
DILIGENCE AND EXERCISE REASONABLE EFFORTS TO OBTAIN AND MAINTAIN, OR CAUSE TO BE
OBTAINED AND MAINTAINED, ALL APPROVALS NECESSARY TO USE AND OPERATE, FOR ITS
PERMITTED USE, EACH PROPERTY AND THE FACILITY LOCATED THEREON UNDER APPLICABLE
LAW AND, WITHOUT LIMITING THE FOREGOING, SHALL EXERCISE REASONABLE EFFORTS TO
MAINTAIN (OR CAUSE TO BE MAINTAINED) APPROPRIATE CERTIFICATIONS FOR
REIMBURSEMENT AND LICENSURE.

 

4.1.3           LAWFUL USE, ETC.  TENANT SHALL NOT, AND SHALL NOT PERMIT ANY
PERSON TO USE OR SUFFER OR PERMIT THE USE OF ANY PROPERTY OR TENANT’S PERSONAL
PROPERTY, IF ANY, FOR ANY UNLAWFUL PURPOSE.  TENANT SHALL NOT, AND SHALL NOT
PERMIT ANY PERSON TO, COMMIT OR SUFFER TO BE COMMITTED ANY WASTE ON ANY
PROPERTY, OR IN ANY FACILITY, NOR SHALL TENANT CAUSE OR PERMIT ANY UNLAWFUL
NUISANCE THEREON OR THEREIN.  TENANT SHALL NOT, AND SHALL NOT PERMIT ANY PERSON
TO, SUFFER NOR PERMIT ANY PROPERTY, OR ANY PORTION THEREOF, TO BE USED IN SUCH A
MANNER AS (A) MAY MATERIALLY AND ADVERSELY IMPAIR LANDLORD’S TITLE THERETO OR TO
ANY PORTION THEREOF, OR (B) MAY REASONABLY ALLOW A CLAIM OR CLAIMS FOR ADVERSE
USAGE OR ADVERSE POSSESSION BY THE PUBLIC, AS SUCH, OR OF IMPLIED DEDICATION OF
SUCH PROPERTY, OR ANY PORTION THEREOF.

 

4.2          COMPLIANCE WITH LEGAL/INSURANCE REQUIREMENTS, ETC.  SUBJECT TO THE
PROVISIONS OF SECTION 5.1.2(B) AND ARTICLE 8, TENANT, AT ITS SOLE EXPENSE, SHALL
(A) COMPLY WITH (OR CAUSE TO BE COMPLIED WITH) ALL MATERIAL LEGAL REQUIREMENTS
AND INSURANCE REQUIREMENTS IN RESPECT OF THE USE, OPERATION, MAINTENANCE,
REPAIR, ALTERATION AND RESTORATION OF ANY PROPERTY AND WITH THE TERMS AND
CONDITIONS OF ANY GROUND LEASE AFFECTING ANY PROPERTY, (B) PERFORM (OR CAUSE TO
BE PERFORMED) IN A TIMELY FASHION ALL OF LANDLORD’S OBLIGATIONS UNDER ANY GROUND
LEASE AFFECTING ANY PROPERTY AND (C) PROCURE, MAINTAIN AND COMPLY WITH (OR CAUSE
TO BE PROCURED, MAINTAINED AND COMPLIED WITH) ALL MATERIAL

 

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LICENSES, CERTIFICATES OF NEED, PERMITS, PROVIDER AGREEMENTS AND OTHER
AUTHORIZATIONS AND AGREEMENTS REQUIRED FOR ANY USE OF ANY PROPERTY AND TENANT’S
PERSONAL PROPERTY, IF ANY, THEN BEING MADE, AND FOR THE PROPER ERECTION,
INSTALLATION, OPERATION AND MAINTENANCE OF THE LEASED PROPERTY OR ANY PART
THEREOF.

 

4.3          COMPLIANCE WITH MEDICAID AND MEDICARE REQUIREMENTS.  TENANT, AT ITS
SOLE COST AND EXPENSE, SHALL MAKE (OR SHALL CAUSE TO BE MADE), WHATEVER
IMPROVEMENTS (CAPITAL OR ORDINARY) AS ARE REQUIRED TO CONFORM EACH PROPERTY TO
SUCH STANDARDS AS MAY, FROM TIME TO TIME, BE REQUIRED BY FEDERAL MEDICARE (TITLE
18) OR MEDICAID (TITLE 19) FOR SKILLED AND/OR INTERMEDIATE CARE NURSING
PROGRAMS, TO THE EXTENT TENANT IS A PARTICIPANT IN SUCH PROGRAMS WITH RESPECT TO
SUCH PROPERTY, OR ANY OTHER APPLICABLE PROGRAMS OR LEGISLATION, OR CAPITAL
IMPROVEMENTS REQUIRED BY ANY OTHER GOVERNMENTAL AGENCY HAVING JURISDICTION OVER
ANY PROPERTY AS A CONDITION OF THE CONTINUED OPERATION OF SUCH PROPERTY FOR ITS
PERMITTED USE.

 

4.4          ENVIRONMENTAL MATTERS.

 

4.4.1           RESTRICTION ON USE, ETC.  DURING THE TERM AND ANY OTHER TIME
THAT TENANT SHALL BE IN POSSESSION OF ANY PROPERTY, TENANT SHALL NOT, AND SHALL
NOT PERMIT ANY PERSON TO, STORE, SPILL UPON, DISPOSE OF OR TRANSFER TO OR FROM
SUCH PROPERTY ANY HAZARDOUS SUBSTANCE, EXCEPT IN COMPLIANCE WITH ALL APPLICABLE
LAWS.  DURING THE TERM AND ANY OTHER TIME THAT TENANT SHALL BE IN POSSESSION OF
ANY PROPERTY, TENANT SHALL MAINTAIN (OR SHALL CAUSE TO BE MAINTAINED) SUCH
PROPERTY AT ALL TIMES FREE OF ANY HAZARDOUS SUBSTANCE (EXCEPT IN COMPLIANCE WITH
ALL APPLICABLE LAWS).  TENANT SHALL PROMPTLY:  (A) UPON RECEIPT OF NOTICE OR
KNOWLEDGE, NOTIFY LANDLORD IN WRITING OF ANY MATERIAL CHANGE IN THE NATURE OR
EXTENT OF HAZARDOUS SUBSTANCES AT ANY PROPERTY, (B) TRANSMIT TO LANDLORD A COPY
OF ANY REPORT WHICH IS REQUIRED TO BE FILED BY TENANT OR ANY MANAGER WITH
RESPECT TO ANY PROPERTY PURSUANT TO SARA TITLE III OR ANY OTHER APPLICABLE LAW,
(C) TRANSMIT TO LANDLORD COPIES OF ANY CITATIONS, ORDERS, NOTICES OR OTHER
GOVERNMENTAL COMMUNICATIONS RECEIVED BY TENANT OR ANY MANAGER OR THEIR
RESPECTIVE AGENTS OR REPRESENTATIVES WITH RESPECT THERETO (COLLECTIVELY,
“ENVIRONMENTAL NOTICE”), WHICH ENVIRONMENTAL NOTICE REQUIRES A WRITTEN RESPONSE
OR ANY ACTION TO BE TAKEN AND/OR IF SUCH ENVIRONMENTAL NOTICE GIVES NOTICE OF
AND/OR PRESENTS A MATERIAL RISK OF ANY MATERIAL VIOLATION OF ANY APPLICABLE LAW
AND/OR PRESENTS A MATERIAL RISK OF ANY MATERIAL COST, EXPENSE, LOSS OR DAMAGE
(AN “ENVIRONMENTAL OBLIGATION”), (D) OBSERVE AND COMPLY WITH (OR CAUSE TO BE
OBSERVED AND COMPLIED WITH) ALL APPLICABLE LAWS RELATING TO THE USE, MAINTENANCE
AND DISPOSAL OF HAZARDOUS SUBSTANCES AND ALL ORDERS OR DIRECTIVES FROM ANY
OFFICIAL, COURT OR AGENCY OF

 

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COMPETENT JURISDICTION RELATING TO THE USE OR MAINTENANCE OR REQUIRING THE
REMOVAL, TREATMENT, CONTAINMENT OR OTHER DISPOSITION THEREOF, AND (E) PAY OR
OTHERWISE DISPOSE (OR CAUSE TO BE PAID OR OTHERWISE DISPOSED) OF ANY FINE,
CHARGE OR IMPOSITION RELATED THERETO, UNLESS TENANT OR ANY MANAGER SHALL CONTEST
THE SAME IN GOOD FAITH AND BY APPROPRIATE PROCEEDINGS AND THE RIGHT TO USE AND
THE VALUE OF ANY OF THE LEASED PROPERTY IS NOT MATERIALLY AND ADVERSELY AFFECTED
THEREBY.

 

If, at any time prior to the termination of this Agreement, Hazardous Substances
(other than those maintained in accordance with Applicable Laws) are discovered
on any Property, subject to Tenant’s right to contest the same in accordance
with Article 8, Tenant shall take (and shall cause to be taken) all actions and
incur any and all expenses, as are required by any Government Agency and by
Applicable Law, (x) to clean up and remove from and about such Property all
Hazardous Substances thereon, (y) to contain and prevent any further release or
threat of release of Hazardous Substances on or about such Property and (z) to
use good faith efforts to eliminate any further release or threat of release of
Hazardous Substances on or about such Property.

 

4.4.2           INDEMNIFICATION OF LANDLORD.  TENANT SHALL PROTECT, INDEMNIFY
AND HOLD HARMLESS LANDLORD AND EACH FACILITY MORTGAGEE, THEIR TRUSTEES,
OFFICERS, AGENTS, EMPLOYEES AND BENEFICIARIES, AND ANY OF THEIR RESPECTIVE
SUCCESSORS OR ASSIGNS WITH RESPECT TO THIS AGREEMENT (COLLECTIVELY, THE
“INDEMNITEES” AND, INDIVIDUALLY, AN “INDEMNITEE”) FOR, FROM AND AGAINST ANY AND
ALL DEBTS, LIENS, CLAIMS, CAUSES OF ACTION, ADMINISTRATIVE ORDERS OR NOTICES,
COSTS, FINES, PENALTIES OR EXPENSES (INCLUDING, WITHOUT LIMITATION, REASONABLE
ATTORNEY’S FEES AND EXPENSES) IMPOSED UPON, INCURRED BY OR ASSERTED AGAINST ANY
INDEMNITEE RESULTING FROM, EITHER DIRECTLY OR INDIRECTLY, THE PRESENCE IN, UPON
OR UNDER THE SOIL OR GROUND WATER OF ANY PROPERTY OR ANY PROPERTIES SURROUNDING
SUCH PROPERTY OF ANY HAZARDOUS SUBSTANCES IN VIOLATION OF ANY APPLICABLE LAW,
EXCEPT TO THE EXTENT THE SAME ARISE FROM THE ACTS OR OMISSIONS OF LANDLORD OR
ANY OTHER INDEMNITEE OR DURING ANY PERIOD THAT LANDLORD OR A PERSON DESIGNATED
BY LANDLORD (OTHER THAN TENANT) IS IN POSSESSION OF SUCH PROPERTY FROM AND AFTER
THE COMMENCEMENT DATE FOR SUCH PROPERTY.  TENANT’S DUTY HEREIN INCLUDES, BUT IS
NOT LIMITED TO, COSTS ASSOCIATED WITH PERSONAL INJURY OR PROPERTY DAMAGE CLAIMS
AS A RESULT OF THE PRESENCE PRIOR TO THE EXPIRATION OR SOONER TERMINATION OF THE
TERM AND THE SURRENDER OF SUCH PROPERTY TO LANDLORD IN ACCORDANCE WITH THE TERMS
OF THIS AGREEMENT OF HAZARDOUS SUBSTANCES IN, UPON OR UNDER THE SOIL OR GROUND
WATER OF SUCH PROPERTY IN VIOLATION OF ANY APPLICABLE LAW.  UPON NOTICE FROM
LANDLORD AND ANY OTHER OF

 

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THE INDEMNITEES, TENANT SHALL UNDERTAKE THE DEFENSE, AT TENANT’S SOLE COST AND
EXPENSE, OF ANY INDEMNIFICATION DUTIES SET FORTH HEREIN, IN WHICH EVENT, TENANT
SHALL NOT BE LIABLE FOR PAYMENT OF ANY DUPLICATIVE ATTORNEYS’ FEES INCURRED BY
ANY INDEMNITEE.

 

Tenant shall, upon demand, pay (or cause to be paid) to Landlord, as an
Additional Charge, any cost, expense, loss or damage (including, without
limitation, reasonable attorneys’ fees) reasonably incurred by Landlord and
arising from a failure of Tenant to observe and perform  (or to cause to be
observed and performed) the requirements of this Section 4.4, which amounts
shall bear interest from the date ten (10) Business Days after written demand
therefor is given to Tenant until paid by Tenant to Landlord at the Overdue
Rate.

 

4.4.3           SURVIVAL.  THE PROVISIONS OF THIS SECTION 4.4 SHALL SURVIVE THE
EXPIRATION OR SOONER TERMINATION OF THIS AGREEMENT.

 

ARTICLE 5

 

MAINTENANCE AND REPAIRS

 

5.1          MAINTENANCE AND REPAIR.

 

5.1.1           TENANT’S GENERAL OBLIGATIONS.  TENANT SHALL KEEP (OR CAUSE TO BE
KEPT), AT TENANT’S SOLE COST AND EXPENSE, THE LEASED PROPERTY AND ALL PRIVATE
ROADWAYS, SIDEWALKS AND CURBS APPURTENANT THERETO (AND TENANT’S PERSONAL
PROPERTY) IN GOOD ORDER AND REPAIR, REASONABLE WEAR AND TEAR EXCEPTED (WHETHER
OR NOT THE NEED FOR SUCH REPAIRS OCCURS AS A RESULT OF TENANT’S OR ANY MANAGER’S
USE, ANY PRIOR USE, THE ELEMENTS OR THE AGE OF THE LEASED PROPERTY OR TENANT’S
PERSONAL PROPERTY OR ANY PORTION THEREOF), AND SHALL PROMPTLY MAKE OR CAUSE TO
BE MADE ALL NECESSARY AND APPROPRIATE REPAIRS AND REPLACEMENTS TO EACH PROPERTY
OF EVERY KIND AND NATURE, WHETHER INTERIOR OR EXTERIOR, STRUCTURAL OR
NONSTRUCTURAL, ORDINARY OR EXTRAORDINARY, FORESEEN OR UNFORESEEN OR ARISING BY
REASON OF A CONDITION EXISTING PRIOR TO THE COMMENCEMENT DATE FOR SUCH PROPERTY
(CONCEALED OR OTHERWISE).  ALL REPAIRS SHALL BE MADE IN A GOOD, WORKMANLIKE
MANNER, CONSISTENT WITH INDUSTRY STANDARDS FOR COMPARABLE FACILITIES IN LIKE
LOCALES, IN ACCORDANCE WITH ALL APPLICABLE FEDERAL, STATE AND LOCAL STATUTES,
ORDINANCES, CODES, RULES AND REGULATIONS RELATING TO ANY SUCH WORK.  TENANT
SHALL NOT TAKE OR OMIT TO TAKE (OR PERMIT ANY PERSON TO TAKE OR OMIT TO TAKE)
ANY ACTION, THE TAKING OR OMISSION OF WHICH WOULD MATERIALLY AND ADVERSELY
IMPAIR THE VALUE OR THE USEFULNESS OF THE LEASED PROPERTY OR ANY MATERIAL PART
THEREOF FOR ITS PERMITTED USE.  TENANT’S OBLIGATIONS UNDER THIS SECTION 5.1.1
SHALL BE LIMITED

 

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IN THE EVENT OF ANY CASUALTY OR CONDEMNATION AS SET FORTH IN ARTICLE 10 AND
ARTICLE 11 AND TENANT’S OBLIGATIONS WITH RESPECT TO HAZARDOUS SUBSTANCES ARE AS
SET FORTH IN SECTION 4.4.

 

5.1.2           LANDLORD’S OBLIGATIONS.

 

(A)           EXCEPT AS OTHERWISE EXPRESSLY PROVIDED IN THIS AGREEMENT, LANDLORD
SHALL NOT, UNDER ANY CIRCUMSTANCES, BE REQUIRED TO BUILD OR REBUILD ANY
IMPROVEMENT ON THE LEASED PROPERTY, OR TO MAKE ANY REPAIRS, REPLACEMENTS,
ALTERATIONS, RESTORATIONS OR RENEWALS OF ANY NATURE OR DESCRIPTION TO THE LEASED
PROPERTY, WHETHER ORDINARY OR EXTRAORDINARY, STRUCTURAL OR NONSTRUCTURAL,
FORESEEN OR UNFORESEEN, OR TO MAKE ANY EXPENDITURE WHATSOEVER WITH RESPECT
THERETO, OR TO MAINTAIN THE LEASED PROPERTY IN ANY WAY.  EXCEPT AS OTHERWISE
EXPRESSLY PROVIDED IN THIS AGREEMENT, TENANT HEREBY WAIVES, TO THE MAXIMUM
EXTENT PERMITTED BY LAW, THE RIGHT TO MAKE REPAIRS AT ANY PROPERTY AT THE
EXPENSE OF LANDLORD PURSUANT TO ANY LAW IN EFFECT ON THE COMMENCEMENT DATE FOR
SUCH PROPERTY OR THEREAFTER ENACTED.  LANDLORD SHALL HAVE THE RIGHT TO GIVE,
RECORD AND POST, AS APPROPRIATE, NOTICES OF NONRESPONSIBILITY UNDER ANY
MECHANIC’S LIEN LAWS NOW OR HEREAFTER EXISTING.

 

(B)           IF, PURSUANT TO THE TERMS OF THIS AGREEMENT, TENANT IS REQUIRED TO
MAKE ANY EXPENDITURES IN CONNECTION WITH ANY REPAIR, MAINTENANCE OR RENOVATION
WITH RESPECT TO ANY PROPERTY, TENANT MAY, AT ITS ELECTION, ADVANCE SUCH FUNDS OR
GIVE LANDLORD NOTICE THEREOF, WHICH NOTICE SHALL SET FORTH, IN REASONABLE
DETAIL, THE NATURE OF THE REQUIRED REPAIR, RENOVATION OR REPLACEMENT, THE
ESTIMATED COST THEREOF AND SUCH OTHER INFORMATION WITH RESPECT THERETO AS
LANDLORD MAY REASONABLY REQUIRE.  PROVIDED THAT NO EVENT OF DEFAULT SHALL HAVE
OCCURRED AND BE CONTINUING AND TENANT SHALL OTHERWISE COMPLY WITH THE APPLICABLE
PROVISIONS OF ARTICLE 6, LANDLORD SHALL, WITHIN TEN (10) BUSINESS DAYS AFTER
SUCH NOTICE, SUBJECT TO AND IN ACCORDANCE WITH THE APPLICABLE PROVISIONS OF
ARTICLE 6, DISBURSE SUCH REQUIRED FUNDS TO TENANT (OR, IF TENANT SHALL SO ELECT,
DIRECTLY TO THE MANAGER OR ANY OTHER PERSON PERFORMING THE REQUIRED WORK) AND,
UPON SUCH DISBURSEMENT, THE MINIMUM RENT SHALL BE ADJUSTED AS PROVIDED IN
SECTION 3.1.1(C).  NOTWITHSTANDING THE FOREGOING, LANDLORD MAY ELECT NOT TO
DISBURSE SUCH REQUIRED FUNDS TO TENANT; PROVIDED, HOWEVER, THAT IF LANDLORD
SHALL ELECT NOT TO DISBURSE SUCH REQUIRED FUNDS AS AFORESAID, TENANT’S
OBLIGATION TO MAKE SUCH REQUIRED REPAIR, RENOVATION OR REPLACEMENT SHALL BE
DEEMED WAIVED BY LANDLORD, AND, NOTWITHSTANDING ANYTHING CONTAINED IN THIS
AGREEMENT TO THE CONTRARY, TENANT SHALL HAVE NO

 

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OBLIGATION TO MAKE SUCH REQUIRED REPAIR, RENOVATION OR REPLACEMENT.

 

5.1.3           NONRESPONSIBILITY OF LANDLORD, ETC.  ALL MATERIALMEN,
CONTRACTORS, ARTISANS, MECHANICS AND LABORERS AND OTHER PERSONS CONTRACTING WITH
TENANT WITH RESPECT TO THE LEASED PROPERTY, OR ANY PART THEREOF, ARE HEREBY
CHARGED WITH NOTICE THAT LIENS ON THE LEASED PROPERTY OR ON LANDLORD’S INTEREST
THEREIN ARE EXPRESSLY PROHIBITED AND THAT THEY MUST LOOK SOLELY TO TENANT TO
SECURE PAYMENT FOR ANY WORK DONE OR MATERIAL FURNISHED TO TENANT OR ANY MANAGER
OR FOR ANY OTHER PURPOSE DURING THE TERM OF THIS AGREEMENT.

 

Nothing contained in this Agreement shall be deemed or construed in any way as
constituting the consent or request of Landlord, express or implied, by
inference or otherwise, to any contractor, subcontractor, laborer or materialmen
for the performance of any labor or the furnishing of any materials for any
alteration, addition, improvement or repair to the Leased Property or any part
thereof or as giving Tenant any right, power or authority to contract for or
permit the rendering of any services or the furnishing of any materials that
would give rise to the filing of any lien against the Leased Property or any
part thereof nor to subject Landlord’s estate in the Leased Property or any part
thereof to liability under any mechanic’s lien law of any State in any way, it
being expressly understood Landlord’s estate shall not be subject to any such
liability.

 

5.2          TENANT’S PERSONAL PROPERTY.  TENANT SHALL PROVIDE AND MAINTAIN (OR
CAUSE TO BE PROVIDED AND MAINTAINED) THROUGHOUT THE TERM ALL SUCH TENANT’S
PERSONAL PROPERTY AS SHALL BE NECESSARY IN ORDER TO OPERATE IN COMPLIANCE WITH
APPLICABLE MATERIAL LEGAL REQUIREMENTS AND INSURANCE REQUIREMENTS AND OTHERWISE
IN ACCORDANCE WITH CUSTOMARY PRACTICE IN THE INDUSTRY FOR THE PERMITTED USE. 
IF, FROM AND AFTER THE COMMENCEMENT DATE WITH RESPECT TO ANY PROPERTY, TENANT
ACQUIRES AN INTEREST IN ANY ITEM OF TANGIBLE PERSONAL PROPERTY (OTHER THAN MOTOR
VEHICLES) ON, OR IN CONNECTION WITH, THE LEASED PROPERTY, OR ANY PORTION
THEREOF, WHICH BELONGS TO ANYONE OTHER THAN TENANT, TENANT SHALL REQUIRE THE
AGREEMENTS PERMITTING SUCH USE TO PROVIDE THAT LANDLORD OR ITS DESIGNEE MAY
ASSUME TENANT’S RIGHTS AND OBLIGATIONS UNDER SUCH AGREEMENT UPON LANDLORD’S
PURCHASE OF THE SAME IN ACCORDANCE WITH THE PROVISIONS OF ARTICLE 15 AND THE
ASSUMPTION OF MANAGEMENT OR OPERATION OF THE FACILITY BY LANDLORD OR ITS
DESIGNEE.

 

5.3          YIELD UP.  UPON THE EXPIRATION OR SOONER TERMINATION OF THIS
AGREEMENT (OR THE TERMINATION OF THIS AGREEMENT WITH RESPECT TO ANY PROPERTY),
TENANT SHALL VACATE AND SURRENDER THE

 

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LEASED PROPERTY OR SUCH PROPERTY (AS APPLICABLE) TO LANDLORD IN SUBSTANTIALLY
THE SAME CONDITION IN WHICH SUCH PROPERTY WAS IN ON ITS COMMENCEMENT DATE,
EXCEPT AS REPAIRED, REBUILT, RESTORED, ALTERED OR ADDED TO AS PERMITTED OR
REQUIRED BY THE PROVISIONS OF THIS AGREEMENT, REASONABLE WEAR AND TEAR EXCEPTED
(AND CASUALTY DAMAGE AND CONDEMNATION, IN THE EVENT THAT THIS AGREEMENT IS
TERMINATED FOLLOWING A CASUALTY OR CONDEMNATION IN ACCORDANCE WITH ARTICLE 10 OR
ARTICLE 11 EXCEPTED).

 

In addition, upon the expiration or earlier termination of this Agreement,
Tenant shall, at Landlord’s sole cost and expense, use its good faith efforts to
transfer (or cause to be transferred) to and cooperate with Landlord or
Landlord’s nominee in connection with the processing of all applications for
licenses, operating permits and other governmental authorizations and all
contracts, including contracts with governmental or quasi-governmental Entities
which may be necessary for the use and operation of the Facility as then
operated.  If requested by Landlord, Tenant shall continue to manage one or more
of the Facilities after the expiration of the Term for up to one hundred eighty
(180) days, on such reasonable terms (which shall include an agreement to
reimburse Tenant for its reasonable out-of-pocket costs and expenses, and
reasonable administrative costs), as Landlord shall reasonably request.

 

5.4          MANAGEMENT AGREEMENT.  TENANT SHALL NOT, WITHOUT LANDLORD’S PRIOR
WRITTEN CONSENT (WHICH CONSENT SHALL NOT BE UNREASONABLY WITHHELD, DELAYED OR
CONDITIONED), ENTER INTO, AMEND OR MODIFY THE PROVISIONS OF ANY MANAGEMENT
AGREEMENT WITH RESPECT TO ANY PROPERTY.  ANY MANAGEMENT AGREEMENT ENTERED INTO
PURSUANT TO THE PROVISIONS OF THIS SECTION 5.4 SHALL BE SUBORDINATE TO THIS
AGREEMENT AND SHALL PROVIDE, INTER ALIA, THAT ALL AMOUNTS DUE FROM TENANT TO
MANAGER THEREUNDER SHALL BE SUBORDINATE TO ALL AMOUNTS DUE FROM TENANT TO
LANDLORD (PROVIDED THAT, AS LONG AS NO EVENT OF DEFAULT HAS OCCURRED AND IS
CONTINUING, TENANT MAY PAY ALL AMOUNTS DUE TO MANAGER THEREUNDER PURSUANT TO
SUCH MANAGEMENT AGREEMENT) AND FOR TERMINATION THEREOF, AT LANDLORD’S OPTION,
UPON THE TERMINATION OF THIS AGREEMENT.  TENANT SHALL NOT TAKE ANY ACTION, GRANT
ANY CONSENT OR PERMIT ANY ACTION UNDER ANY SUCH MANAGEMENT AGREEMENT WHICH MIGHT
HAVE A MATERIAL ADVERSE EFFECT ON LANDLORD, WITHOUT THE PRIOR WRITTEN CONSENT OF
LANDLORD, WHICH CONSENT SHALL NOT BE UNREASONABLY WITHHELD, DELAYED OR
CONDITIONED.

 

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ARTICLE 6

 

IMPROVEMENTS, ETC.

 

6.1          IMPROVEMENTS TO THE LEASED PROPERTY.  TENANT SHALL NOT MAKE,
CONSTRUCT OR INSTALL (OR PERMIT TO BE MADE, CONSTRUCTED OR INSTALLED) ANY
CAPITAL ADDITIONS WITHOUT, IN EACH INSTANCE, OBTAINING LANDLORD’S PRIOR WRITTEN
CONSENT, WHICH CONSENT SHALL NOT BE UNREASONABLY WITHHELD, DELAYED OR
CONDITIONED PROVIDED THAT (A) CONSTRUCTION OR INSTALLATION OF THE SAME WOULD NOT
ADVERSELY AFFECT OR VIOLATE ANY MATERIAL LEGAL REQUIREMENT OR INSURANCE
REQUIREMENT APPLICABLE TO ANY PROPERTY AND (B) LANDLORD SHALL HAVE RECEIVED AN
OFFICER’S CERTIFICATE CERTIFYING AS TO THE SATISFACTION OF THE CONDITIONS SET
OUT IN CLAUSE (A) ABOVE; PROVIDED, HOWEVER, THAT NO SUCH CONSENT SHALL BE
REQUIRED IN THE EVENT IMMEDIATE ACTION IS REQUIRED TO PREVENT IMMINENT HARM TO
PERSON OR PROPERTY.  PRIOR TO COMMENCING CONSTRUCTION OF ANY CAPITAL ADDITION,
TENANT SHALL SUBMIT TO LANDLORD, IN WRITING, A PROPOSAL SETTING FORTH, IN
REASONABLE DETAIL, ANY SUCH PROPOSED IMPROVEMENT AND SHALL PROVIDE TO LANDLORD
SUCH PLANS AND SPECIFICATIONS, AND SUCH PERMITS, LICENSES, CONTRACTS AND SUCH
OTHER INFORMATION CONCERNING THE SAME AS LANDLORD MAY REASONABLY REQUEST. 
LANDLORD SHALL HAVE THIRTY (30) DAYS TO REVIEW ALL MATERIALS SUBMITTED TO
LANDLORD IN CONNECTION WITH ANY SUCH PROPOSAL.  FAILURE OF LANDLORD TO RESPOND
TO TENANT’S PROPOSAL WITHIN THIRTY (30) DAYS AFTER RECEIPT OF ALL INFORMATION
AND MATERIALS REQUESTED BY LANDLORD IN CONNECTION WITH THE PROPOSED IMPROVEMENT
SHALL BE DEEMED TO CONSTITUTE APPROVAL OF THE SAME.  WITHOUT LIMITING THE
GENERALITY OF THE FOREGOING, SUCH PROPOSAL SHALL INDICATE THE APPROXIMATE
PROJECTED COST OF CONSTRUCTING SUCH PROPOSED IMPROVEMENT AND THE USE OR USES TO
WHICH IT WILL BE PUT.  NO CAPITAL ADDITION SHALL BE MADE WHICH WOULD TIE IN OR
CONNECT ANY LEASED IMPROVEMENTS WITH ANY OTHER IMPROVEMENTS ON PROPERTY ADJACENT
TO ANY PROPERTY (AND NOT PART OF THE LAND) INCLUDING, WITHOUT LIMITATION,
TIE-INS OF BUILDINGS OR OTHER STRUCTURES OR UTILITIES.  EXCEPT AS PERMITTED
HEREIN, TENANT SHALL NOT FINANCE THE COST OF ANY CONSTRUCTION OF SUCH
IMPROVEMENT BY THE GRANTING OF A LIEN ON OR SECURITY INTEREST IN THE LEASED
PROPERTY OR SUCH IMPROVEMENT, OR TENANT’S INTEREST THEREIN, WITHOUT THE PRIOR
WRITTEN CONSENT OF LANDLORD, WHICH CONSENT MAY BE WITHHELD BY LANDLORD IN
LANDLORD’S SOLE DISCRETION.  ANY SUCH IMPROVEMENTS SHALL, UPON THE EXPIRATION OR
SOONER TERMINATION OF THIS AGREEMENT, REMAIN OR PASS TO AND BECOME THE PROPERTY
OF LANDLORD, FREE AND CLEAR OF ALL ENCUMBRANCES OTHER THAN PERMITTED
ENCUMBRANCES.

 

6.2          SALVAGE.  ALL MATERIALS WHICH ARE SCRAPPED OR REMOVED IN CONNECTION
WITH THE MAKING OF EITHER CAPITAL ADDITIONS OR

 

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NON-CAPITAL ADDITIONS OR REPAIRS REQUIRED BY ARTICLE 5 SHALL BE OR BECOME THE
PROPERTY OF THE PARTY THAT PAID FOR SUCH WORK.

 

ARTICLE 7

 

LIENS

 

7.1          LIENS.  SUBJECT TO ARTICLE 8, TENANT SHALL USE ITS BEST EFFORTS
NOT, DIRECTLY OR INDIRECTLY, TO CREATE OR ALLOW TO REMAIN AND SHALL PROMPTLY
DISCHARGE (OR CAUSE TO BE DISCHARGED), AT ITS EXPENSE, ANY LIEN, ENCUMBRANCE,
ATTACHMENT, TITLE RETENTION AGREEMENT OR CLAIM UPON THE LEASED PROPERTY, OR ANY
PORTION THEREOF, OR TENANT’S LEASEHOLD INTEREST THEREIN OR ANY ATTACHMENT, LEVY,
CLAIM OR ENCUMBRANCE IN RESPECT OF THE RENT, OTHER THAN (A) PERMITTED
ENCUMBRANCES, (B) RESTRICTIONS, LIENS AND OTHER ENCUMBRANCES WHICH ARE CONSENTED
TO IN WRITING BY LANDLORD, (C) LIENS FOR THOSE TAXES OF LANDLORD WHICH TENANT IS
NOT REQUIRED TO PAY HEREUNDER, (D) SUBLEASES PERMITTED BY ARTICLE 16, (E) LIENS
FOR IMPOSITIONS OR FOR SUMS RESULTING FROM NONCOMPLIANCE WITH LEGAL REQUIREMENTS
SO LONG AS (I) THE SAME ARE NOT YET DUE AND PAYABLE, OR (II) ARE BEING CONTESTED
IN ACCORDANCE WITH ARTICLE 8, (F) LIENS OF MECHANICS, LABORERS, MATERIALMEN,
SUPPLIERS OR VENDORS INCURRED IN THE ORDINARY COURSE OF BUSINESS THAT ARE NOT
YET DUE AND PAYABLE OR ARE FOR SUMS THAT ARE BEING CONTESTED IN ACCORDANCE WITH
ARTICLE 8, (G) ANY FACILITY MORTGAGES OR OTHER LIENS WHICH ARE THE
RESPONSIBILITY OF LANDLORD PURSUANT TO THE PROVISIONS OF ARTICLE 20 AND
(H) LANDLORD LIENS AND ANY OTHER VOLUNTARY LIENS CREATED BY LANDLORD.

 

7.2          LANDLORD’S LIEN.  IN ADDITION TO ANY STATUTORY LANDLORD’S LIEN AND
IN ORDER TO SECURE PAYMENT OF THE RENT AND ALL OTHER SUMS PAYABLE HEREUNDER BY
TENANT, AND TO SECURE PAYMENT OF ANY LOSS, COST OR DAMAGE WHICH LANDLORD MAY
SUFFER BY REASON OF TENANT’S BREACH OF THIS AGREEMENT, TENANT HEREBY GRANTS UNTO
LANDLORD, TO THE MAXIMUM EXTENT PERMITTED BY APPLICABLE LAW, A SECURITY INTEREST
IN AND AN EXPRESS CONTRACTUAL LIEN UPON TENANT’S PERSONAL PROPERTY (EXCEPT MOTOR
VEHICLES), AND TENANT’S INTEREST IN ALL LEDGER SHEETS, FILES, RECORDS, DOCUMENTS
AND INSTRUMENTS (INCLUDING, WITHOUT LIMITATION, COMPUTER PROGRAMS, TAPES AND
RELATED ELECTRONIC DATA PROCESSING) RELATING TO THE OPERATION OF THE FACILITIES
(THE “RECORDS”) AND ALL PROCEEDS THEREFROM, SUBJECT TO ANY PERMITTED
ENCUMBRANCES; AND SUCH TENANT’S PERSONAL PROPERTY SHALL NOT BE REMOVED FROM THE
LEASED PROPERTY AT ANY TIME WHEN AN EVENT OF DEFAULT HAS OCCURRED AND IS
CONTINUING.

 

Upon Landlord’s request, Tenant shall execute and deliver to Landlord financing
statements in form sufficient to perfect

 

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the security interest of Landlord in Tenant’s Personal Property and the proceeds
thereof in accordance with the provisions of the applicable laws of the State. 
During the continuance of an Event of Default, Tenant hereby grants Landlord an
irrevocable limited power of attorney, coupled with an interest, to execute all
such financing statements in Tenant’s name, place and stead.  The security
interest herein granted is in addition to any statutory lien for the Rent.

 

ARTICLE 8

 

PERMITTED CONTESTS

 

Tenant shall have the right to contest the amount or validity of any Imposition,
Legal Requirement, Insurance Requirement, Environmental Obligation, lien,
attachment, levy, encumbrance, charge or claim (collectively, “Claims”) as to
the Leased Property, by appropriate legal proceedings, conducted in good faith
and with due diligence, provided that (a) the foregoing shall in no way be
construed as relieving, modifying or extending Tenant’s obligation to pay (or
cause to be paid) any Claims as finally determined, (b) such contest shall not
cause Landlord or Tenant to be in default under any mortgage or deed of trust
encumbering the Leased Property, or any portion thereof (Landlord agreeing that
any such mortgage or deed of trust shall permit Tenant to exercise the rights
granted pursuant to this Article 8) or any interest therein or result in or
reasonably be expected to result in a lien attaching to the Leased Property, or
any portion thereof, (c) no part of the Leased Property nor any Rent therefrom
shall be in any immediate danger of sale, forfeiture, attachment or loss, and
(d) Tenant shall indemnify and hold harmless Landlord from and against any cost,
claim, damage, penalty or reasonable expense, including reasonable attorneys’
fees, incurred by Landlord in connection therewith or as a result thereof. 
Landlord agrees to join in any such proceedings if required legally to prosecute
such contest, provided that Landlord shall not thereby be subjected to any
liability therefor (including, without limitation, for the payment of any costs
or expenses in connection therewith) unless Tenant agrees by agreement in form
and substance reasonably satisfactory to Landlord, to assume and indemnify
Landlord with respect to the same.  Tenant shall be entitled to any refund of
any Claims and such charges and penalties or interest thereon which have been
paid by Tenant or paid by Landlord to the extent that Landlord has been fully
reimbursed by Tenant.  If Tenant shall fail (x) to pay or cause to be paid any
Claims when finally determined, (y) to provide reasonable security therefor or
(z) to prosecute or cause to be prosecuted

 

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any such contest diligently and in good faith, Landlord may, upon reasonable
notice to Tenant (which notice shall not be required if Landlord shall
reasonably determine that the same is not practicable), pay such charges,
together with interest and penalties due with respect thereto, and Tenant shall
reimburse Landlord therefor, upon demand, as Additional Charges.

 

ARTICLE 9

 

INSURANCE AND INDEMNIFICATION

 

9.1          GENERAL INSURANCE REQUIREMENTS.  TENANT SHALL, AT ALL TIMES DURING
THE TERM AND AT ANY OTHER TIME TENANT SHALL BE IN POSSESSION OF ANY PROPERTY, OR
ANY PORTION THEREOF, KEEP (OR CAUSE TO BE KEPT) SUCH PROPERTY AND ALL PROPERTY
LOCATED THEREIN OR THEREON, INSURED AGAINST THE RISKS AND IN SUCH AMOUNTS AS IS
AGAINST SUCH RISKS AND IN SUCH AMOUNTS AS LANDLORD SHALL REASONABLY REQUIRE AND
MAY BE COMMERCIALLY REASONABLE.  TENANT SHALL PREPARE A PROPOSAL SETTING FORTH
THE INSURANCE TENANT PROPOSES TO BE MAINTAINED WITH RESPECT TO EACH PROPERTY
DURING THE ENSUING FISCAL YEAR AND SHALL SUBMIT SUCH PROPOSAL TO LANDLORD ON OR
BEFORE DECEMBER 1 OF THE PRECEDING LEASE YEAR FOR LANDLORD’S REVIEW AND
APPROVAL, WHICH APPROVAL SHALL NOT BE UNREASONABLY WITHHELD, DELAYED OR
CONDITIONED.  IN THE EVENT THAT LANDLORD SHALL FAIL TO RESPOND WITHIN THIRTY
(30) DAYS AFTER RECEIPT OF SUCH PROPOSAL, SUCH PROPOSAL SHALL BE DEEMED
APPROVED.

 

9.2          WAIVER OF SUBROGATION.  LANDLORD AND TENANT AGREE THAT (INSOFAR AS
AND TO THE EXTENT THAT SUCH AGREEMENT MAY BE EFFECTIVE WITHOUT INVALIDATING OR
MAKING IT IMPOSSIBLE TO SECURE INSURANCE COVERAGE FROM RESPONSIBLE INSURANCE
COMPANIES DOING BUSINESS IN ANY STATE) WITH RESPECT TO ANY PROPERTY LOSS WHICH
IS COVERED BY INSURANCE THEN BEING CARRIED BY LANDLORD OR TENANT, THE PARTY
CARRYING SUCH INSURANCE AND SUFFERING SAID LOSS RELEASES THE OTHERS OF AND FROM
ANY AND ALL CLAIMS WITH RESPECT TO SUCH LOSS; AND THEY FURTHER AGREE THAT THEIR
RESPECTIVE INSURANCE COMPANIES (AND, IF LANDLORD OR TENANT SHALL SELF INSURE IN
ACCORDANCE WITH THE TERMS HEREOF, LANDLORD OR TENANT, AS THE CASE MAY BE) SHALL
HAVE NO RIGHT OF SUBROGATION AGAINST THE OTHER ON ACCOUNT THEREOF, EVEN THOUGH
EXTRA PREMIUM MAY RESULT THEREFROM.  IN THE EVENT THAT ANY EXTRA PREMIUM IS
PAYABLE BY TENANT AS A RESULT OF THIS PROVISION, LANDLORD SHALL NOT BE LIABLE
FOR REIMBURSEMENT TO TENANT FOR SUCH EXTRA PREMIUM.

 

9.3          FORM SATISFACTORY, ETC.  ALL INSURANCE POLICIES AND ENDORSEMENTS
REQUIRED PURSUANT TO THIS ARTICLE 9 SHALL BE FULLY PAID FOR, NONASSESSABLE, AND
ISSUED BY REPUTABLE INSURANCE

 

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COMPANIES AUTHORIZED TO DO BUSINESS IN THE STATE AND HAVING A GENERAL POLICY
HOLDER’S RATING OF NO LESS THAN A IN BEST’S LATEST RATING GUIDE.  ALL PROPERTY,
BUSINESS INTERRUPTION, LIABILITY AND FLOOD INSURANCE POLICIES WITH RESPECT TO
EACH PROPERTY SHALL INCLUDE NO DEDUCTIBLE IN EXCESS OF TWO HUNDRED FIFTY
THOUSAND DOLLARS ($250,000).  AT ALL TIMES, ALL PROPERTY, BUSINESS INTERRUPTION,
LIABILITY AND FLOOD INSURANCE POLICIES, WITH THE EXCEPTION OF WORKER’S
COMPENSATION INSURANCE COVERAGE, SHALL NAME LANDLORD AND ANY FACILITY MORTGAGEE
AS ADDITIONAL INSUREDS, AS THEIR INTERESTS MAY APPEAR.  ALL LOSS ADJUSTMENTS
SHALL BE PAYABLE AS PROVIDED IN ARTICLE 10, EXCEPT THAT LOSSES UNDER LIABILITY
AND WORKER’S COMPENSATION INSURANCE POLICIES SHALL BE PAYABLE DIRECTLY TO THE
PARTY ENTITLED THERETO.  TENANT SHALL CAUSE ALL INSURANCE PREMIUMS TO BE PAID
AND SHALL DELIVER (OR CAUSE TO BE DELIVERED) POLICIES OR CERTIFICATES THEREOF TO
LANDLORD PRIOR TO THEIR EFFECTIVE DATE (AND, WITH RESPECT TO ANY RENEWAL POLICY,
PRIOR TO THE EXPIRATION OF THE EXISTING POLICY).  ALL SUCH POLICIES SHALL
PROVIDE LANDLORD (AND ANY FACILITY MORTGAGEE IF REQUIRED BY THE SAME) THIRTY
(30) DAYS PRIOR WRITTEN NOTICE OF ANY MATERIAL CHANGE OR CANCELLATION OF SUCH
POLICY.  IN THE EVENT TENANT SHALL FAIL TO EFFECT (OR CAUSE TO BE EFFECTED) SUCH
INSURANCE AS HEREIN REQUIRED, TO PAY (OR CAUSE TO BE PAID) THE PREMIUMS THEREFOR
OR TO DELIVER (OR CAUSE TO BE DELIVERED) SUCH POLICIES OR CERTIFICATES TO
LANDLORD OR ANY FACILITY MORTGAGEE AT THE TIMES REQUIRED, LANDLORD SHALL HAVE
THE RIGHT, BUT NOT THE OBLIGATION, UPON NOTICE TO TENANT, TO ACQUIRE SUCH
INSURANCE AND PAY THE PREMIUMS THEREFOR, WHICH AMOUNTS SHALL BE PAYABLE TO
LANDLORD, UPON DEMAND, AS ADDITIONAL CHARGES, TOGETHER WITH INTEREST ACCRUED
THEREON AT THE OVERDUE RATE FROM THE DATE SUCH PAYMENT IS MADE UNTIL (BUT
EXCLUDING) THE DATE REPAID.

 

9.4          NO SEPARATE INSURANCE; SELF-INSURANCE.  TENANT SHALL NOT TAKE (OR
PERMIT ANY PERSON TO TAKE) OUT SEPARATE INSURANCE, CONCURRENT IN FORM OR
CONTRIBUTING IN THE EVENT OF LOSS WITH THAT REQUIRED BY THIS ARTICLE 9, OR
INCREASE THE AMOUNT OF ANY EXISTING INSURANCE BY SECURING AN ADDITIONAL POLICY
OR ADDITIONAL POLICIES, UNLESS ALL PARTIES HAVING AN INSURABLE INTEREST IN THE
SUBJECT MATTER OF SUCH INSURANCE, INCLUDING LANDLORD AND ALL FACILITY
MORTGAGEES, ARE INCLUDED THEREIN AS ADDITIONAL INSUREDS AND THE LOSS IS PAYABLE
UNDER SUCH INSURANCE IN THE SAME MANNER AS LOSSES ARE PAYABLE UNDER THIS
AGREEMENT.  IN THE EVENT TENANT SHALL TAKE OUT ANY SUCH SEPARATE INSURANCE OR
INCREASE ANY OF THE AMOUNTS OF THE THEN EXISTING INSURANCE, TENANT SHALL GIVE
LANDLORD PROMPT NOTICE THEREOF.  TENANT SHALL NOT SELF-INSURE (OR PERMIT ANY
PERSON TO SELF-INSURE).

 

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9.5          INDEMNIFICATION OF LANDLORD.  NOTWITHSTANDING THE EXISTENCE OF ANY
INSURANCE PROVIDED FOR HEREIN AND WITHOUT REGARD TO THE POLICY LIMITS OF ANY
SUCH INSURANCE, TENANT SHALL PROTECT, INDEMNIFY AND HOLD HARMLESS LANDLORD FOR,
FROM AND AGAINST ALL LIABILITIES, OBLIGATIONS, CLAIMS, DAMAGES, PENALTIES,
CAUSES OF ACTION, COSTS AND REASONABLE EXPENSES (INCLUDING, WITHOUT LIMITATION,
REASONABLE ATTORNEYS’ FEES), TO THE MAXIMUM EXTENT PERMITTED BY LAW, IMPOSED
UPON OR INCURRED BY OR ASSERTED AGAINST LANDLORD BY REASON OF THE FOLLOWING,
EXCEPT TO THE EXTENT CAUSED BY LANDLORD’S GROSS NEGLIGENCE OR WILLFUL
MISCONDUCT:  (A) ANY ACCIDENT, INJURY TO OR DEATH OF PERSONS OR LOSS OF OR
DAMAGE TO PROPERTY OCCURRING ON OR ABOUT ANY PROPERTY OR PORTION THEREOF OR
ADJOINING SIDEWALKS OR RIGHTS OF WAY, (B) ANY PAST, PRESENT OR FUTURE USE,
MISUSE, NON-USE, CONDITION, MANAGEMENT, MAINTENANCE OR REPAIR BY TENANT, ANY
MANAGER OR ANYONE CLAIMING UNDER ANY OF THEM OR TENANT’S PERSONAL PROPERTY OR
ANY LITIGATION, PROCEEDING OR CLAIM BY GOVERNMENTAL ENTITIES OR OTHER THIRD
PARTIES TO WHICH LANDLORD IS MADE A PARTY OR PARTICIPANT RELATING TO ANY
PROPERTY OR PORTION THEREOF OR TENANT’S PERSONAL PROPERTY OR SUCH USE, MISUSE,
NON-USE, CONDITION, MANAGEMENT, MAINTENANCE, OR REPAIR THEREOF INCLUDING,
FAILURE TO PERFORM OBLIGATIONS (OTHER THAN CONDEMNATION PROCEEDINGS) TO WHICH
LANDLORD IS MADE A PARTY, (C) ANY IMPOSITIONS THAT ARE THE OBLIGATIONS OF TENANT
TO PAY PURSUANT TO THE APPLICABLE PROVISIONS OF THIS AGREEMENT, AND (D) ANY
FAILURE ON THE PART OF TENANT OR ANYONE CLAIMING UNDER TENANT TO PERFORM OR
COMPLY WITH ANY OF THE TERMS OF THIS AGREEMENT.  TENANT, AT ITS EXPENSE, SHALL
CONTEST, RESIST AND DEFEND ANY SUCH CLAIM, ACTION OR PROCEEDING ASSERTED OR
INSTITUTED AGAINST LANDLORD (AND SHALL NOT BE RESPONSIBLE FOR ANY DUPLICATIVE
ATTORNEYS’ FEES INCURRED BY LANDLORD) OR MAY COMPROMISE OR OTHERWISE DISPOSE OF
THE SAME, WITH LANDLORD’S PRIOR WRITTEN CONSENT (WHICH CONSENT MAY NOT BE
UNREASONABLY WITHHELD, DELAYED OR CONDITIONED).  THE OBLIGATIONS OF TENANT UNDER
THIS SECTION 9.5 ARE IN ADDITION TO THE OBLIGATIONS SET FORTH IN SECTION 4.4 AND
SHALL SURVIVE THE TERMINATION OF THIS AGREEMENT.

 

ARTICLE 10

 

CASUALTY

 

10.1        INSURANCE PROCEEDS.  EXCEPT AS PROVIDED IN THE LAST CLAUSE OF THIS
SENTENCE, ALL PROCEEDS PAYABLE BY REASON OF ANY LOSS OR DAMAGE TO ANY PROPERTY,
OR ANY PORTION THEREOF, AND INSURED UNDER ANY POLICY OF INSURANCE REQUIRED BY
ARTICLE 9 (OTHER THAN THE PROCEEDS OF ANY BUSINESS INTERRUPTION INSURANCE) SHALL
BE PAID DIRECTLY TO LANDLORD (SUBJECT TO THE PROVISIONS OF SECTION 10.2) AND ALL
LOSS ADJUSTMENTS WITH RESPECT TO LOSSES

 

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PAYABLE TO LANDLORD SHALL REQUIRE THE PRIOR WRITTEN CONSENT OF LANDLORD, WHICH
CONSENT SHALL NOT BE UNREASONABLY WITHHELD, DELAYED OR CONDITIONED; PROVIDED,
HOWEVER, THAT, SO LONG AS NO EVENT OF DEFAULT SHALL HAVE OCCURRED AND BE
CONTINUING, ALL SUCH PROCEEDS LESS THAN OR EQUAL TO TWO HUNDRED FIFTY THOUSAND
DOLLARS ($250,000) SHALL BE PAID DIRECTLY TO TENANT AND SUCH LOSSES MAY BE
ADJUSTED WITHOUT LANDLORD’S CONSENT.  IF TENANT IS REQUIRED TO RECONSTRUCT OR
REPAIR ANY PROPERTY AS PROVIDED HEREIN, SUCH PROCEEDS SHALL BE PAID OUT BY
LANDLORD FROM TIME TO TIME FOR THE REASONABLE COSTS OF RECONSTRUCTION OR REPAIR
OF SUCH PROPERTY NECESSITATED BY SUCH DAMAGE OR DESTRUCTION, SUBJECT TO AND IN
ACCORDANCE WITH THE PROVISIONS OF SECTION 10.2.4.  PROVIDED NO DEFAULT OR EVENT
OF DEFAULT HAS OCCURRED AND IS CONTINUING, ANY EXCESS PROCEEDS OF INSURANCE
REMAINING AFTER THE COMPLETION OF THE RESTORATION SHALL BE PAID TO TENANT.  IN
THE EVENT THAT THE PROVISIONS OF SECTION 10.2.1 ARE APPLICABLE, THE INSURANCE
PROCEEDS SHALL BE RETAINED BY THE PARTY ENTITLED THERETO PURSUANT TO
SECTION 10.2.1.

 

10.2        DAMAGE OR DESTRUCTION.

 

10.2.1         DAMAGE OR DESTRUCTION OF LEASED PROPERTY.  IF, DURING THE TERM,
ANY PROPERTY SHALL BE TOTALLY OR PARTIALLY DESTROYED AND THE FACILITY LOCATED
THEREON IS THEREBY RENDERED UNSUITABLE FOR ITS PERMITTED USE, EITHER LANDLORD OR
TENANT MAY, BY THE GIVING OF NOTICE THEREOF TO THE OTHER, TERMINATE THIS
AGREEMENT WITH RESPECT TO SUCH AFFECTED PROPERTY, WHEREUPON, THIS AGREEMENT
SHALL TERMINATE WITH RESPECT TO SUCH AFFECTED PROPERTY AND LANDLORD SHALL BE
ENTITLED TO RETAIN THE INSURANCE PROCEEDS PAYABLE ON ACCOUNT OF SUCH DAMAGE.  IN
SUCH EVENT, TENANT SHALL PAY TO LANDLORD THE AMOUNT OF ANY DEDUCTIBLE UNDER THE
INSURANCE POLICIES COVERING SUCH FACILITY, THE AMOUNT OF ANY UNINSURED LOSS AND
ANY DIFFERENCE BETWEEN THE REPLACEMENT COST OF THE AFFECTED PROPERTY AND THE
CASUALTY INSURANCE PROCEEDS THEREFOR.

 

10.2.2         PARTIAL DAMAGE OR DESTRUCTION.  IF, DURING THE TERM, ANY PROPERTY
SHALL BE TOTALLY OR PARTIALLY DESTROYED BUT THE FACILITY IS NOT RENDERED
UNSUITABLE FOR ITS PERMITTED USE, TENANT SHALL, SUBJECT TO SECTION 10.2.3,
PROMPTLY RESTORE SUCH FACILITY AS PROVIDED IN SECTION 10.2.4.

 

10.2.3         INSUFFICIENT INSURANCE PROCEEDS.  IF THE COST OF THE REPAIR OR
RESTORATION OF THE APPLICABLE FACILITY EXCEEDS THE AMOUNT OF INSURANCE PROCEEDS
RECEIVED BY LANDLORD AND TENANT PURSUANT TO SECTION 9.1, TENANT SHALL GIVE
LANDLORD NOTICE THEREOF WHICH NOTICE SHALL SET FORTH IN REASONABLE DETAIL THE
NATURE OF SUCH DEFICIENCY AND WHETHER TENANT SHALL PAY AND ASSUME THE AMOUNT OF
SUCH DEFICIENCY (TENANT HAVING NO

 

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OBLIGATION TO DO SO, EXCEPT THAT, IF TENANT SHALL ELECT TO MAKE SUCH FUNDS
AVAILABLE, THE SAME SHALL BECOME AN IRREVOCABLE OBLIGATION OF TENANT PURSUANT TO
THIS AGREEMENT).  IN THE EVENT TENANT SHALL ELECT NOT TO PAY AND ASSUME THE
AMOUNT OF SUCH DEFICIENCY, LANDLORD SHALL HAVE THE RIGHT (BUT NOT THE
OBLIGATION), EXERCISABLE AT LANDLORD’S SOLE ELECTION BY NOTICE TO TENANT, GIVEN
WITHIN SIXTY (60) DAYS AFTER TENANT’S NOTICE OF THE DEFICIENCY, TO ELECT TO MAKE
AVAILABLE FOR APPLICATION TO THE COST OF REPAIR OR RESTORATION THE AMOUNT OF
SUCH DEFICIENCY; PROVIDED, HOWEVER, IN SUCH EVENT, UPON ANY DISBURSEMENT BY
LANDLORD THEREOF, THE MINIMUM RENT SHALL BE ADJUSTED AS PROVIDED IN
SECTION 3.1.1(C).  IN THE EVENT THAT NEITHER LANDLORD NOR TENANT SHALL ELECT TO
MAKE SUCH DEFICIENCY AVAILABLE FOR RESTORATION, EITHER LANDLORD OR TENANT MAY
TERMINATE THIS AGREEMENT WITH RESPECT TO THE AFFECTED PROPERTY BY NOTICE TO THE
OTHER, WHEREUPON, THIS AGREEMENT SHALL SO TERMINATE AND INSURANCE PROCEEDS SHALL
BE DISTRIBUTED AS PROVIDED IN SECTION 10.2.1.  IT IS EXPRESSLY UNDERSTOOD AND
AGREED, HOWEVER, THAT, NOTWITHSTANDING ANYTHING IN THIS AGREEMENT TO THE
CONTRARY, TENANT SHALL BE STRICTLY LIABLE AND SOLELY RESPONSIBLE FOR THE AMOUNT
OF ANY DEDUCTIBLE AND SHALL, UPON ANY INSURABLE LOSS, PAY OVER THE AMOUNT OF
SUCH DEDUCTIBLE TO LANDLORD AT THE TIME AND IN THE MANNER HEREIN PROVIDED FOR
PAYMENT OF THE APPLICABLE PROCEEDS TO LANDLORD.

 

10.2.4         DISBURSEMENT OF PROCEEDS.  IN THE EVENT TENANT IS REQUIRED TO
RESTORE ANY PROPERTY PURSUANT TO SECTION 10.2 AND THIS AGREEMENT IS NOT
TERMINATED AS TO SUCH PROPERTY PURSUANT TO THIS ARTICLE 10, TENANT SHALL
COMMENCE (OR CAUSE TO BE COMMENCED) PROMPTLY AND CONTINUE DILIGENTLY TO PERFORM
(OR CAUSE TO BE PERFORMED) THE REPAIR AND RESTORATION OF SUCH PROPERTY
(HEREINAFTER CALLED THE “WORK”), SO AS TO RESTORE (OR CAUSE TO BE RESTORED) THE
APPLICABLE PROPERTY IN MATERIAL COMPLIANCE WITH ALL LEGAL REQUIREMENTS AND SO
THAT SUCH PROPERTY SHALL BE, TO THE EXTENT PRACTICABLE, SUBSTANTIALLY EQUIVALENT
IN VALUE AND GENERAL UTILITY TO ITS GENERAL UTILITY AND VALUE IMMEDIATELY PRIOR
TO SUCH DAMAGE OR DESTRUCTION.  SUBJECT TO THE TERMS HEREOF, LANDLORD SHALL
ADVANCE THE INSURANCE PROCEEDS AND ANY ADDITIONAL AMOUNTS PAYABLE BY LANDLORD
PURSUANT TO SECTION 10.2.3 OR OTHERWISE DEPOSITED WITH LANDLORD TO TENANT
REGULARLY DURING THE REPAIR AND RESTORATION PERIOD SO AS TO PERMIT PAYMENT FOR
THE COST OF ANY SUCH RESTORATION AND REPAIR.  ANY SUCH ADVANCES SHALL BE MADE
NOT MORE THAN MONTHLY WITHIN TEN (10) BUSINESS DAYS AFTER TENANT SUBMITS TO
LANDLORD A WRITTEN REQUISITION AND SUBSTANTIATION THEREFOR ON AIA FORMS G702 AND
G703 (OR ON SUCH OTHER FORM OR FORMS AS MAY BE REASONABLY ACCEPTABLE TO
LANDLORD).  LANDLORD MAY, AT ITS OPTION, CONDITION ADVANCEMENT OF SUCH INSURANCE
PROCEEDS AND OTHER AMOUNTS ON

 

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(A) THE ABSENCE OF ANY EVENT OF DEFAULT, (B) ITS APPROVAL OF PLANS AND
SPECIFICATIONS OF AN ARCHITECT SATISFACTORY TO LANDLORD (WHICH APPROVAL SHALL
NOT BE UNREASONABLY WITHHELD, DELAYED OR CONDITIONED), (C) GENERAL CONTRACTORS’
ESTIMATES, (D) ARCHITECT’S CERTIFICATES, (E) CONDITIONAL LIEN WAIVERS OF GENERAL
CONTRACTORS, IF AVAILABLE, (F) EVIDENCE OF APPROVAL BY ALL GOVERNMENTAL
AUTHORITIES AND OTHER REGULATORY BODIES WHOSE APPROVAL IS REQUIRED, (G), IF
TENANT HAS ELECTED TO ADVANCE DEFICIENCY FUNDS PURSUANT TO SECTION 10.2.3,
TENANT DEPOSITING THE AMOUNT THEREOF WITH LANDLORD AND (H) SUCH OTHER
CERTIFICATES AS LANDLORD MAY, FROM TIME TO TIME, REASONABLY REQUIRE.

 

Landlord’s obligation to disburse insurance proceeds under this Article 10 shall
be subject to the release of such proceeds by any Facility Mortgagee to
Landlord.

 

Tenant’s obligation to restore the applicable Property pursuant to this
Article 10 shall be subject to the release of available insurance proceeds by
the applicable Facility Mortgagee to Landlord or directly to Tenant and, in the
event such proceeds are insufficient, Landlord electing to make such deficiency
available therefor (and disbursement of such deficiency).

 

10.3        DAMAGE NEAR END OF TERM.  NOTWITHSTANDING ANY PROVISIONS OF
SECTION 10.1 OR 10.2 TO THE CONTRARY, IF DAMAGE TO OR DESTRUCTION OF ANY
PROPERTY OCCURS DURING THE LAST TWELVE (12) MONTHS OF THE TERM AND IF SUCH
DAMAGE OR DESTRUCTION CANNOT REASONABLY BE EXPECTED TO BE FULLY REPAIRED AND
RESTORED PRIOR TO THE DATE THAT IS SIX (6) MONTHS PRIOR TO THE END OF THE TERM,
THE PROVISIONS OF SECTION 10.2.1 SHALL APPLY AS IF SUCH PROPERTY HAD BEEN
TOTALLY OR PARTIALLY DESTROYED AND THE FACILITY THEREON RENDERED UNSUITABLE FOR
ITS PERMITTED USE.

 

10.4        TENANT’S PROPERTY.  ALL INSURANCE PROCEEDS PAYABLE BY REASON OF ANY
LOSS OF OR DAMAGE TO ANY OF TENANT’S PERSONAL PROPERTY SHALL BE PAID TO TENANT
AND, TO THE EXTENT NECESSARY TO REPAIR OR REPLACE TENANT’S PERSONAL PROPERTY IN
ACCORDANCE WITH SECTION 10.5, TENANT SHALL HOLD SUCH PROCEEDS IN TRUST TO PAY
THE COST OF REPAIRING OR REPLACING DAMAGED TENANT’S PERSONAL PROPERTY.

 

10.5        RESTORATION OF TENANT’S PROPERTY.  IF TENANT IS REQUIRED TO RESTORE
ANY PROPERTY AS HEREINABOVE PROVIDED, TENANT SHALL EITHER (A) RESTORE ALL
ALTERATIONS AND IMPROVEMENTS MADE BY TENANT AND TENANT’S PERSONAL PROPERTY, OR
(B) REPLACE SUCH ALTERATIONS AND IMPROVEMENTS AND TENANT’S PERSONAL PROPERTY
WITH IMPROVEMENTS OR ITEMS OF THE SAME OR BETTER QUALITY AND UTILITY IN THE
OPERATION OF SUCH PROPERTY.

 

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10.6        NO ABATEMENT OF RENT.  THIS AGREEMENT SHALL REMAIN IN FULL FORCE AND
EFFECT AND TENANT’S OBLIGATION TO MAKE ALL PAYMENTS OF RENT AND TO PAY ALL OTHER
CHARGES AS AND WHEN REQUIRED UNDER THIS AGREEMENT SHALL REMAIN UNABATED DURING
THE TERM NOTWITHSTANDING ANY DAMAGE INVOLVING THE LEASED PROPERTY, OR ANY
PORTION THEREOF (PROVIDED THAT LANDLORD SHALL CREDIT AGAINST SUCH PAYMENTS ANY
AMOUNTS PAID TO LANDLORD AS A CONSEQUENCE OF SUCH DAMAGE UNDER ANY BUSINESS
INTERRUPTION INSURANCE OBTAINED BY TENANT HEREUNDER).  THE PROVISIONS OF THIS
ARTICLE 10 SHALL BE CONSIDERED AN EXPRESS AGREEMENT GOVERNING ANY CAUSE OF
DAMAGE OR DESTRUCTION TO THE LEASED PROPERTY, OR ANY PORTION THEREOF, AND, TO
THE MAXIMUM EXTENT PERMITTED BY LAW, NO LOCAL OR STATE STATUTE, LAWS, RULES,
REGULATION OR ORDINANCE IN EFFECT DURING THE TERM WHICH PROVIDE FOR SUCH A
CONTINGENCY SHALL HAVE ANY APPLICATION IN SUCH CASE.

 

10.7        WAIVER.  TENANT HEREBY WAIVES ANY STATUTORY RIGHTS OF TERMINATION
WHICH MAY ARISE BY REASON OF ANY DAMAGE OR DESTRUCTION OF THE LEASED PROPERTY,
OR ANY PORTION THEREOF.

 

ARTICLE 11

 

CONDEMNATION

 

11.1        TOTAL CONDEMNATION, ETC.  IF EITHER (A) THE WHOLE OF ANY PROPERTY
SHALL BE TAKEN BY CONDEMNATION OR (B) A CONDEMNATION OF LESS THAN THE WHOLE OF
ANY PROPERTY RENDERS ANY PROPERTY UNSUITABLE FOR ITS PERMITTED USE, THIS
AGREEMENT SHALL TERMINATE WITH RESPECT TO SUCH PROPERTY, TENANT AND LANDLORD
SHALL SEEK THE AWARD FOR THEIR INTERESTS IN THE APPLICABLE PROPERTY AS PROVIDED
IN SECTION 11.5.

 

11.2        PARTIAL CONDEMNATION.  IN THE EVENT OF A CONDEMNATION OF LESS THAN
THE WHOLE OF ANY PROPERTY SUCH THAT SUCH PROPERTY IS STILL SUITABLE FOR ITS
PERMITTED USE, TENANT SHALL, TO THE EXTENT OF THE AWARD AND ANY ADDITIONAL
AMOUNTS DISBURSED BY LANDLORD AS HEREINAFTER PROVIDED, COMMENCE (OR CAUSE TO BE
COMMENCED) PROMPTLY AND CONTINUE DILIGENTLY TO RESTORE (OR CAUSE TO BE RESTORED)
THE UNTAKEN PORTION OF THE APPLICABLE LEASED IMPROVEMENTS SO THAT SUCH LEASED
IMPROVEMENTS SHALL CONSTITUTE A COMPLETE ARCHITECTURAL UNIT OF THE SAME GENERAL
CHARACTER AND CONDITION (AS NEARLY AS MAY BE POSSIBLE UNDER THE CIRCUMSTANCES)
AS SUCH LEASED IMPROVEMENTS EXISTING IMMEDIATELY PRIOR TO SUCH CONDEMNATION, IN
MATERIAL COMPLIANCE WITH ALL LEGAL REQUIREMENTS, SUBJECT TO THE PROVISIONS OF
THIS SECTION 11.2.  IF THE COST OF THE REPAIR OR RESTORATION OF THE AFFECTED
PROPERTY EXCEEDS THE AMOUNT OF THE AWARD, TENANT SHALL GIVE LANDLORD NOTICE
THEREOF WHICH NOTICE SHALL SET FORTH IN REASONABLE DETAIL THE NATURE OF SUCH
DEFICIENCY AND WHETHER

 

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TENANT SHALL PAY AND ASSUME THE AMOUNT OF SUCH DEFICIENCY (TENANT HAVING NO
OBLIGATION TO DO SO, EXCEPT THAT IF TENANT SHALL ELECT TO MAKE SUCH FUNDS
AVAILABLE, THE SAME SHALL BECOME AN IRREVOCABLE OBLIGATION OF TENANT PURSUANT TO
THIS AGREEMENT).  IN THE EVENT TENANT SHALL ELECT NOT TO PAY AND ASSUME THE
AMOUNT OF SUCH DEFICIENCY, LANDLORD SHALL HAVE THE RIGHT (BUT NOT THE
OBLIGATION), EXERCISABLE AT LANDLORD’S SOLE ELECTION BY NOTICE TO TENANT GIVEN
WITHIN SIXTY (60) DAYS AFTER TENANT’S NOTICE OF THE DEFICIENCY, TO ELECT TO MAKE
AVAILABLE FOR APPLICATION TO THE COST OF REPAIR OR RESTORATION THE AMOUNT OF
SUCH DEFICIENCY; PROVIDED, HOWEVER, IN SUCH EVENT, UPON ANY DISBURSEMENT BY
LANDLORD THEREOF, THE MINIMUM RENT SHALL BE ADJUSTED AS PROVIDED IN
SECTION 3.1.1(C).  IN THE EVENT THAT NEITHER LANDLORD NOR TENANT SHALL ELECT TO
MAKE SUCH DEFICIENCY AVAILABLE FOR RESTORATION, EITHER LANDLORD OR TENANT MAY
TERMINATE THIS AGREEMENT WITH RESPECT TO THE AFFECTED PROPERTY AND THE ENTIRE
AWARD SHALL BE ALLOCATED AS SET FORTH IN SECTION 11.5.

 

Subject to the terms hereof, Landlord shall contribute to the cost of
restoration that part of the Award necessary to complete such repair or
restoration, together with severance and other damages awarded for the taken
Leased Improvements and any deficiency Landlord has agreed to disburse, to
Tenant regularly during the restoration period so as to permit payment for the
cost of such repair or restoration.  Landlord may, at its option, condition
advancement of such Award and other amounts on (a) the absence of any Event of
Default, (b) its approval of plans and specifications of an architect
satisfactory to Landlord (which approval shall not be unreasonably withheld,
delayed or conditioned), (c) general contractors’ estimates, (iv) architect’s
certificates, (d) conditional lien waivers of general contractors, if available,
(e) evidence of approval by all governmental authorities and other regulatory
bodies whose approval is required, (f), if Tenant has elected to advance
deficiency funds pursuant to the preceding paragraph, Tenant depositing the
amount thereof with Landlord and (g) such other certificates as Landlord may,
from time to time, reasonably require.  Landlord’s obligation under this
Section 11.2 to disburse the Award and such other amounts shall be subject to
(x) the collection thereof by Landlord and (y) the satisfaction of any
applicable requirements of any Facility Mortgage, and the release of such Award
by the applicable Facility Mortgagee.  Tenant’s obligation to restore the Leased
Property shall be subject to the release of the Award by the applicable Facility
Mortgagee to Landlord.

 

11.3        ABATEMENT OF RENT.  OTHER THAN AS SPECIFICALLY PROVIDED IN THIS
AGREEMENT, THIS AGREEMENT SHALL REMAIN IN FULL

 

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FORCE AND EFFECT AND TENANT’S OBLIGATION TO MAKE ALL PAYMENTS OF RENT AND TO PAY
ALL OTHER CHARGES AS AND WHEN REQUIRED UNDER THIS AGREEMENT SHALL REMAIN
UNABATED DURING THE TERM NOTWITHSTANDING ANY CONDEMNATION INVOLVING THE LEASED
PROPERTY, OR ANY PORTION THEREOF.  THE PROVISIONS OF THIS ARTICLE 11 SHALL BE
CONSIDERED AN EXPRESS AGREEMENT GOVERNING ANY CONDEMNATION INVOLVING THE LEASED
PROPERTY AND, TO THE MAXIMUM EXTENT PERMITTED BY LAW, NO LOCAL OR STATE STATUTE,
LAW, RULE, REGULATION OR ORDINANCE IN EFFECT DURING THE TERM WHICH PROVIDES FOR
SUCH A CONTINGENCY SHALL HAVE ANY APPLICATION IN SUCH CASE.

 

11.4        TEMPORARY CONDEMNATION.  IN THE EVENT OF ANY TEMPORARY CONDEMNATION
OF ANY PROPERTY OR TENANT’S INTEREST THEREIN, THIS AGREEMENT SHALL CONTINUE IN
FULL FORCE AND EFFECT AND TENANT SHALL CONTINUE TO PAY (OR CAUSE TO BE PAID), IN
THE MANNER AND ON THE TERMS HEREIN SPECIFIED, THE FULL AMOUNT OF THE RENT. 
TENANT SHALL CONTINUE TO PERFORM AND OBSERVE (OR CAUSE TO BE PERFORMED AND
OBSERVED) ALL OF THE OTHER TERMS AND CONDITIONS OF THIS AGREEMENT ON THE PART OF
THE TENANT TO BE PERFORMED AND OBSERVED.  PROVIDED NO EVENT OF DEFAULT HAS
OCCURRED AND IS CONTINUING, THE ENTIRE AMOUNT OF ANY AWARD MADE FOR SUCH
TEMPORARY CONDEMNATION ALLOCABLE TO THE TERM, WHETHER PAID BY WAY OF DAMAGES,
RENT OR OTHERWISE, SHALL BE PAID TO TENANT.  TENANT SHALL, PROMPTLY UPON THE
TERMINATION OF ANY SUCH PERIOD OF TEMPORARY CONDEMNATION, AT ITS SOLE COST AND
EXPENSE, RESTORE THE AFFECTED PROPERTY TO THE CONDITION THAT EXISTED IMMEDIATELY
PRIOR TO SUCH CONDEMNATION, IN MATERIAL COMPLIANCE WITH ALL APPLICABLE LEGAL
REQUIREMENTS, UNLESS SUCH PERIOD OF TEMPORARY CONDEMNATION SHALL EXTEND BEYOND
THE EXPIRATION OF THE TERM, IN WHICH EVENT TENANT SHALL NOT BE REQUIRED TO MAKE
SUCH RESTORATION.

 

11.5        ALLOCATION OF AWARD.  EXCEPT AS PROVIDED IN SECTION 11.4 AND THE
SECOND SENTENCE OF THIS SECTION 11.5, THE TOTAL AWARD SHALL BE SOLELY THE
PROPERTY OF AND PAYABLE TO LANDLORD.  ANY PORTION OF THE AWARD MADE FOR THE
TAKING OF TENANT’S LEASEHOLD INTEREST IN THE LEASED PROPERTY, LOSS OF BUSINESS
DURING THE REMAINDER OF THE TERM, THE TAKING OF TENANT’S PERSONAL PROPERTY, THE
TAKING OF CAPITAL ADDITIONS PAID FOR BY TENANT AND TENANT’S REMOVAL AND
RELOCATION EXPENSES SHALL BE THE SOLE PROPERTY OF AND PAYABLE TO TENANT (SUBJECT
TO THE PROVISIONS OF SECTION 11.2).  IN ANY CONDEMNATION PROCEEDINGS, LANDLORD
AND TENANT SHALL EACH SEEK ITS OWN AWARD IN CONFORMITY HEREWITH, AT ITS OWN
EXPENSE.

 

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ARTICLE 12

 

DEFAULTS AND REMEDIES

 

12.1        EVENTS OF DEFAULT.  THE OCCURRENCE OF ANY ONE OR MORE OF THE
FOLLOWING EVENTS SHALL CONSTITUTE AN “EVENT OF DEFAULT” HEREUNDER:

 

(A)           SHOULD TENANT FAIL TO MAKE ANY PAYMENT OF THE RENT OR ANY OTHER
SUM PAYABLE HEREUNDER WHEN DUE; OR

 

(B)           SHOULD TENANT FAIL TO MAINTAIN THE INSURANCE COVERAGES REQUIRED
UNDER ARTICLE 9; OR

 

(C)           SHOULD TENANT DEFAULT IN THE DUE OBSERVANCE OR PERFORMANCE OF ANY
OF THE TERMS, COVENANTS OR AGREEMENTS CONTAINED HEREIN TO BE PERFORMED OR
OBSERVED BY IT (OTHER THAN AS SPECIFIED IN CLAUSES (A) AND (B) ABOVE) AND SHOULD
SUCH DEFAULT CONTINUE FOR A PERIOD OF THIRTY (30) DAYS AFTER NOTICE THEREOF FROM
LANDLORD TO TENANT; PROVIDED, HOWEVER, THAT IF SUCH DEFAULT IS SUSCEPTIBLE OF
CURE BUT SUCH CURE CANNOT BE ACCOMPLISHED WITH DUE DILIGENCE WITHIN SUCH PERIOD
OF TIME AND IF, IN ADDITION, TENANT COMMENCES TO CURE OR CAUSE TO BE CURED SUCH
DEFAULT WITHIN THIRTY (30) DAYS AFTER NOTICE THEREOF FROM LANDLORD AND
THEREAFTER PROSECUTES THE CURING OF SUCH DEFAULT WITH ALL DUE DILIGENCE, SUCH
PERIOD OF TIME SHALL BE EXTENDED TO SUCH PERIOD OF TIME (NOT TO EXCEED AN
ADDITIONAL NINETY (90) DAYS IN THE AGGREGATE) AS MAY BE NECESSARY TO CURE SUCH
DEFAULT WITH ALL DUE DILIGENCE; OR

 

(D)           SHOULD ANY OBLIGATION OF TENANT IN RESPECT OF ANY INDEBTEDNESS FOR
MONEY BORROWED OR FOR ANY MATERIAL PROPERTY OR SERVICES, OR ANY GUARANTY
RELATING THERETO, BE DECLARED TO BE OR BECOME DUE AND PAYABLE PRIOR TO THE
STATED MATURITY THEREOF, OR SHOULD THERE OCCUR AND BE CONTINUING WITH RESPECT TO
ANY SUCH INDEBTEDNESS ANY EVENT OF DEFAULT UNDER ANY INSTRUMENT OR AGREEMENT
EVIDENCING OR SECURING THE SAME, THE EFFECT OF WHICH IS TO PERMIT THE HOLDER OR
HOLDERS OF SUCH INSTRUMENT OR AGREEMENT OR A TRUSTEE, AGENT OR OTHER
REPRESENTATIVE ON BEHALF OF SUCH HOLDER OR HOLDERS, TO CAUSE ANY SUCH
OBLIGATIONS TO BECOME DUE PRIOR TO ITS STATED MATURITY; OR

 

(E)           SHOULD AN EVENT OF DEFAULT BY TENANT, ANY GUARANTOR OR ANY
AFFILIATED PERSON AS TO TENANT OR ANY GUARANTOR OCCUR AND BE CONTINUING BEYOND
THE EXPIRATION OF ANY APPLICABLE CURE PERIOD UNDER ANY OF THE INCIDENTAL
DOCUMENTS; OR

 

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(F)            SHOULD TENANT OR ANY GUARANTOR GENERALLY NOT BE PAYING ITS DEBTS
AS THEY BECOME DUE OR SHOULD TENANT OR ANY GUARANTOR MAKE A GENERAL ASSIGNMENT
FOR THE BENEFIT OF CREDITORS; OR

 

(G)           SHOULD ANY PETITION BE FILED BY OR AGAINST TENANT OR ANY GUARANTOR
UNDER THE FEDERAL BANKRUPTCY LAWS, OR SHOULD ANY OTHER PROCEEDING BE INSTITUTED
BY OR AGAINST TENANT OR ANY GUARANTOR SEEKING TO ADJUDICATE TENANT OR ANY
GUARANTOR A BANKRUPT OR INSOLVENT, OR SEEKING LIQUIDATION, REORGANIZATION,
ARRANGEMENT, ADJUSTMENT OR COMPOSITION OF TENANT’S DEBTS UNDER ANY LAW RELATING
TO BANKRUPTCY, INSOLVENCY OR REORGANIZATION OR RELIEF OF DEBTORS, OR SEEKING THE
ENTRY OF AN ORDER FOR RELIEF OR THE APPOINTMENT OF A RECEIVER, TRUSTEE,
CUSTODIAN OR OTHER SIMILAR OFFICIAL FOR TENANT OR ANY GUARANTOR OR FOR ANY
SUBSTANTIAL PART OF THE PROPERTY OF TENANT OR ANY GUARANTOR AND SUCH PROCEEDING
IS NOT DISMISSED WITHIN ONE HUNDRED EIGHTY (180) DAYS AFTER INSTITUTION THEREOF;
OR

 

(H)           SHOULD TENANT OR ANY GUARANTOR CAUSE OR INSTITUTE ANY PROCEEDING
FOR ITS DISSOLUTION OR TERMINATION; OR

 

(I)            SHOULD THE ESTATE OR INTEREST OF TENANT IN THE LEASED PROPERTY OR
ANY PART THEREOF BE LEVIED UPON OR ATTACHED IN ANY PROCEEDING AND THE SAME SHALL
NOT BE VACATED OR DISCHARGED WITHIN THE LATER OF (X) NINETY (90) DAYS AFTER
COMMENCEMENT THEREOF, UNLESS THE AMOUNT IN DISPUTE IS LESS THAN $250,000, IN
WHICH CASE TENANT SHALL GIVE NOTICE TO LANDLORD OF THE DISPUTE BUT TENANT MAY
DEFEND IN ANY SUITABLE WAY, AND (Y) TWO HUNDRED SEVENTY (270) DAYS AFTER RECEIPT
BY TENANT OF NOTICE THEREOF FROM LANDLORD (UNLESS TENANT SHALL BE CONTESTING
SUCH LIEN OR ATTACHMENT IN GOOD FAITH IN ACCORDANCE WITH ARTICLE 8); OR

 

(J)            SHOULD THERE OCCUR ANY DIRECT OR INDIRECT CHANGE IN CONTROL OF
TENANT OR ANY GUARANTOR;

 

(K)           SHOULD A FINAL UNAPPEALABLE DETERMINATION BE MADE BY THE
APPLICABLE GOVERNMENT AGENCY THAT TENANT SHALL HAVE FAILED TO COMPLY WITH
APPLICABLE MEDICARE AND/OR MEDICAID REGULATIONS IN THE OPERATION OF ANY
FACILITY, AS A RESULT OF WHICH FAILURE TENANT IS DECLARED INELIGIBLE TO RECEIVE
REIMBURSEMENTS UNDER THE MEDICARE AND/OR MEDICAID PROGRAMS FOR SUCH FACILITY; OR

 

(L)            SHOULD THERE OCCUR AN “EVENT OF DEFAULT”, AS DEFINED THEREIN,
UNDER EITHER OF THE LTA GMAC LEASES;

 

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then, and in any such event, Landlord, in addition to all other remedies
available to it, may terminate this Agreement with respect to any or all of the
Leased Property by giving Notice thereof to Tenant and upon the expiration of
the time, if any, fixed in such Notice, this Agreement shall terminate with
respect to all or the designated portion of the Leased Property and all rights
of Tenant under this Agreement with respect thereto shall cease.  Landlord shall
have and may exercise all rights and remedies available at law and in equity to
Landlord as a result of Tenant’s breach of this Agreement.

 

Upon the occurrence of an Event of Default, Landlord may, in addition to any
other remedies provided herein, enter upon the Leased Property, or any portion
thereof, and take possession of any and all of Tenant’s Personal Property, if
any, and the Records, without liability for trespass or conversion (Tenant
hereby waiving any right to notice or hearing prior to such taking of possession
by Landlord) and sell the same at public or private sale, after giving Tenant
reasonable Notice of the time and place of any public or private sale, at which
sale Landlord or its assigns may purchase all or any portion of Tenant’s
Personal Property, if any, unless otherwise prohibited by law.  Unless otherwise
provided by law and without intending to exclude any other manner of giving
Tenant reasonable notice, the requirement of reasonable Notice shall be met if
such Notice is given at least ten (10) days before the date of sale.  The
proceeds from any such disposition, less all expenses incurred in connection
with the taking of possession, holding and selling of such property (including,
reasonable attorneys’ fees) shall be applied as a credit against the
indebtedness which is secured by the security interest granted in Section 7.2. 
Any surplus shall be paid to Tenant or as otherwise required by law and Tenant
shall pay any deficiency to Landlord, as Additional Charges, upon demand.

 

12.2        REMEDIES.  NONE OF (A) THE TERMINATION OF THIS AGREEMENT PURSUANT TO
SECTION 12.1, (B) THE REPOSSESSION OF THE LEASED PROPERTY, OR ANY PORTION
THEREOF, (C) THE FAILURE OF LANDLORD TO RELET THE LEASED PROPERTY, OR ANY
PORTION THEREOF, NOR (D) THE RELETTING OF ALL OR ANY OF PORTION OF THE LEASED
PROPERTY, SHALL RELIEVE TENANT OF ITS LIABILITY AND OBLIGATIONS HEREUNDER, ALL
OF WHICH SHALL SURVIVE ANY SUCH TERMINATION, REPOSSESSION OR RELETTING.  IN THE
EVENT OF ANY SUCH TERMINATION, TENANT SHALL FORTHWITH PAY TO LANDLORD ALL RENT
DUE AND PAYABLE WITH RESPECT TO THE LEASED PROPERTY, OR TERMINATED PORTION
THEREOF, THROUGH AND INCLUDING THE DATE OF SUCH TERMINATION.  THEREAFTER,
TENANT, UNTIL THE END OF WHAT WOULD HAVE BEEN THE TERM OF THIS AGREEMENT IN THE
ABSENCE OF SUCH

 

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TERMINATION, AND WHETHER OR NOT THE LEASED PROPERTY, OR ANY PORTION THEREOF,
SHALL HAVE BEEN RELET, SHALL BE LIABLE TO LANDLORD FOR, AND SHALL PAY TO
LANDLORD, AS CURRENT DAMAGES, THE RENT (ADDITIONAL RENT TO BE REASONABLY
CALCULATED BY LANDLORD BASED ON HISTORICAL GROSS REVENUES) AND OTHER CHARGES
WHICH WOULD BE PAYABLE HEREUNDER FOR THE REMAINDER OF THE TERM HAD SUCH
TERMINATION NOT OCCURRED, LESS THE NET PROCEEDS, IF ANY, OF ANY RELETTING OF THE
LEASED PROPERTY, OR ANY PORTION THEREOF, AFTER DEDUCTING ALL REASONABLE EXPENSES
IN CONNECTION WITH SUCH RELETTING, INCLUDING, WITHOUT LIMITATION, ALL
REPOSSESSION COSTS, BROKERAGE COMMISSIONS, LEGAL EXPENSES, ATTORNEYS’ FEES,
ADVERTISING, EXPENSES OF EMPLOYEES, ALTERATION COSTS AND EXPENSES OF PREPARATION
FOR SUCH RELETTING.  TENANT SHALL PAY SUCH CURRENT DAMAGES TO LANDLORD MONTHLY
ON THE DAYS ON WHICH THE MINIMUM RENT WOULD HAVE BEEN PAYABLE HEREUNDER IF THIS
AGREEMENT HAD NOT BEEN SO TERMINATED WITH RESPECT TO SUCH OF THE LEASED
PROPERTY.

 

At any time after such termination, whether or not Landlord shall have collected
any such current damages, as liquidated final damages beyond the date of such
termination, at Landlord’s election, Tenant shall pay to Landlord an amount
equal to the present value (as reasonably determined by Landlord) of the excess,
if any, of the Rent and other charges which would be payable hereunder from the
date of such termination (assuming that, for the purposes of this paragraph,
annual payments by Tenant on account of Impositions and Additional Rent would be
the same as payments required for the immediately preceding twelve calendar
months, or if less than twelve calendar months have expired since the applicable
Commencement Date for any Property, the payments required for such lesser period
projected to an annual amount) for what would be the then unexpired term of this
Agreement if the same remained in effect, over the fair market rental for the
same period.  Nothing contained in this Agreement shall, however, limit or
prejudice the right of Landlord to prove and obtain in proceedings for
bankruptcy or insolvency an amount equal to the maximum allowed by any statute
or rule of law in effect at the time when, and governing the proceedings in
which, the damages are to be proved, whether or not the amount be greater than,
equal to, or less than the amount of the loss or damages referred to above.

 

In case of any Event of Default, re-entry, expiration and dispossession by
summary proceedings or otherwise, Landlord may (a) relet the Leased Property or
any part or parts thereof, either in the name of Landlord or otherwise, for a
term or terms which may at Landlord’s option, be equal to, less than or exceed
the period which would otherwise have constituted the balance of

 

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the Term and may grant concessions or free rent to the extent that Landlord
considers advisable and necessary to relet the same, and (b) make such
reasonable alterations, repairs and decorations in the Leased Property, or any
portion thereof, as Landlord, in its sole and absolute discretion, considers
advisable and necessary for the purpose of reletting the Leased Property; and
the making of such alterations, repairs and decorations shall not operate or be
construed to release Tenant from liability hereunder as aforesaid.  Landlord
shall in no event be liable in any way whatsoever for any failure to relet all
or any portion of the Leased Property, or, in the event that the Leased Property
is relet, for failure to collect the rent under such reletting.  To the maximum
extent permitted by law, Tenant hereby expressly waives any and all rights of
redemption granted under any present or future laws in the event of Tenant being
evicted or dispossessed, or in the event of Landlord obtaining possession of the
Leased Property, by reason of the occurrence and continuation of an Event of
Default hereunder.

 

12.3        TENANT’S WAIVER.  IF THIS AGREEMENT IS TERMINATED PURSUANT TO
SECTION 12.1 OR 12.2, TENANT WAIVES, TO THE EXTENT PERMITTED BY LAW, ANY RIGHT
TO A TRIAL BY JURY IN THE EVENT OF SUMMARY PROCEEDINGS TO ENFORCE THE REMEDIES
SET FORTH IN THIS ARTICLE 12, AND THE BENEFIT OF ANY LAWS NOW OR HEREAFTER IN
FORCE EXEMPTING PROPERTY FROM LIABILITY FOR RENT OR FOR DEBT.

 

12.4        APPLICATION OF FUNDS.  ANY PAYMENTS RECEIVED BY LANDLORD UNDER ANY
OF THE PROVISIONS OF THIS AGREEMENT DURING THE EXISTENCE OR CONTINUANCE OF ANY
EVENT OF DEFAULT (AND ANY PAYMENT MADE TO LANDLORD RATHER THAN TENANT DUE TO THE
EXISTENCE OF ANY EVENT OF DEFAULT) SHALL BE APPLIED TO TENANT’S CURRENT AND PAST
DUE OBLIGATIONS UNDER THIS AGREEMENT IN SUCH ORDER AS LANDLORD MAY DETERMINE OR
AS MAY BE PRESCRIBED BY THE LAWS OF THE STATE.  ANY BALANCE SHALL BE PAID TO
TENANT.

 

12.5        LANDLORD’S RIGHT TO CURE TENANT’S DEFAULT.  IF AN EVENT OF DEFAULT
SHALL HAVE OCCURRED AND BE CONTINUING, LANDLORD, AFTER NOTICE TO TENANT (WHICH
NOTICE SHALL NOT BE REQUIRED IF LANDLORD SHALL REASONABLY DETERMINE IMMEDIATE
ACTION IS NECESSARY TO PROTECT PERSON OR PROPERTY), WITHOUT WAIVING OR RELEASING
ANY OBLIGATION OF TENANT AND WITHOUT WAIVING OR RELEASING ANY EVENT OF DEFAULT,
MAY (BUT SHALL NOT BE OBLIGATED TO), AT ANY TIME THEREAFTER, MAKE SUCH PAYMENT
OR PERFORM SUCH ACT FOR THE ACCOUNT AND AT THE EXPENSE OF TENANT, AND MAY, TO
THE MAXIMUM EXTENT PERMITTED BY LAW, ENTER UPON THE LEASED PROPERTY, OR ANY
PORTION THEREOF, FOR SUCH PURPOSE AND TAKE ALL SUCH ACTION THEREON AS, IN
LANDLORD’S SOLE AND ABSOLUTE DISCRETION, MAY BE NECESSARY OR APPROPRIATE
THEREFOR.  NO SUCH ENTRY SHALL BE DEEMED AN EVICTION OF TENANT.  ALL REASONABLE

 

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COSTS AND EXPENSES (INCLUDING, WITHOUT LIMITATION, REASONABLE ATTORNEYS’ FEES)
INCURRED BY LANDLORD IN CONNECTION THEREWITH, TOGETHER WITH INTEREST THEREON (TO
THE EXTENT PERMITTED BY LAW) AT THE OVERDUE RATE FROM THE DATE SUCH SUMS ARE
PAID BY LANDLORD UNTIL REPAID, SHALL BE PAID BY TENANT TO LANDLORD, ON DEMAND.

 

ARTICLE 13

 

HOLDING OVER

 

Any holding over by Tenant after the expiration or sooner termination of this
Agreement shall be treated as a daily tenancy at sufferance at a rate equal to
two (2) times the Minimum Rent and other charges herein provided (prorated on a
daily basis).  Tenant shall also pay to Landlord all damages (direct or
indirect) sustained by reason of any such holding over.  Otherwise, such holding
over shall be on the terms and conditions set forth in this Agreement, to the
extent applicable.  Nothing contained herein shall constitute the consent,
express or implied, of Landlord to the holding over of Tenant after the
expiration or earlier termination of this Agreement.

 

ARTICLE 14

 

LANDLORD DEFAULT

 

If Landlord shall default in the performance or observance of any of its
covenants or obligations set forth in this Agreement or any obligation of
Landlord, if any, under any agreement affecting the Leased Property, the
performance of which is not Tenant’s obligation pursuant to this Agreement, and
any such default shall continue for a period of thirty (30) days after Notice
thereof from Tenant to Landlord and any applicable Facility Mortgagee, or such
additional period as may be reasonably required to correct the same, Tenant may
declare the occurrence of a “Landlord Default” by a second Notice to Landlord
and to such Facility Mortgagee.  Thereafter, Tenant may forthwith cure the same
and, subject to the provisions of the following paragraph, invoice Landlord for
costs and expenses (including reasonable attorneys’ fees and court costs)
incurred by Tenant in curing the same, together with interest thereon (to the
extent permitted by law) from the date Landlord receives Tenant’s invoice until
paid, at the Overdue Rate.  Tenant shall have no right to terminate this
Agreement for any default by Landlord hereunder and no right, for any such
default, to offset or counterclaim against any Rent or other charges due
hereunder.

 

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If Landlord shall in good faith dispute the occurrence of any Landlord Default
and Landlord, before the expiration of the applicable cure period, shall give
Notice thereof to Tenant, setting forth, in reasonable detail, the basis
therefor, no Landlord Default shall be deemed to have occurred and Landlord
shall have no obligation with respect thereto until final adverse determination
thereof.  If Tenant and Landlord shall fail, in good faith, to resolve any such
dispute within ten (10) days after Landlord’s Notice of dispute, either may
submit the matter for resolution in accordance with Article 22.

 

ARTICLE 15

 

PURCHASE RIGHTS

 

Landlord shall have the option to purchase Tenant’s Personal Property, at the
expiration or sooner termination of this Agreement, for an amount equal to the
then fair market value thereof (current replacement cost as determined by
agreement of the parties or, in the absence of such agreement, appraisal),
subject to, and with appropriate price adjustments for, all equipment leases,
conditional sale contracts, UCC-1 financing statements and other encumbrances to
which such Personal Property is subject.  Upon the expiration or sooner
termination of this Agreement, Tenant shall use its reasonable efforts to
transfer and assign, or cause to be transferred and assigned, to Landlord or its
designee, or assist Landlord or its designee in obtaining, any contracts,
licenses, and certificates required for the then operation of the Leased
Property.  Notwithstanding the foregoing, Tenant expressly acknowledges and
agrees that nothing contained in this Article 15 shall diminish, impair or
otherwise modify Landlord’s rights under the Security Agreement and that any
amounts paid by Landlord in order to purchase Tenant’s Personal Property in
accordance with this Article 15 shall be applied first to Tenant’s current and
past due obligations under this Agreement in such order as Landlord may
reasonably determine or as may be prescribed by the laws of the State and any
balance shall be paid to Tenant.

 

ARTICLE 16

 

SUBLETTING AND ASSIGNMENT

 

16.1        SUBLETTING AND ASSIGNMENT.  EXCEPT AS PROVIDED IN SECTION 16.3,
TENANT SHALL NOT, WITHOUT LANDLORD’S PRIOR WRITTEN CONSENT (WHICH CONSENT MAY BE
GIVEN OR WITHHELD IN LANDLORD’S SOLE AND ABSOLUTE DISCRETION), ASSIGN, MORTGAGE,
PLEDGE, HYPOTHECATE, ENCUMBER OR OTHERWISE TRANSFER THIS AGREEMENT OR SUBLEASE
OR PERMIT THE SUBLEASE (WHICH TERM SHALL BE DEEMED TO

 

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INCLUDE THE GRANTING OF CONCESSIONS, LICENSES AND THE LIKE), OF THE LEASED
PROPERTY, OR ANY PORTION THEREOF, OR SUFFER OR PERMIT THIS AGREEMENT OR THE
LEASEHOLD ESTATE CREATED HEREBY OR ANY OTHER RIGHTS ARISING UNDER THIS AGREEMENT
TO BE ASSIGNED, TRANSFERRED, MORTGAGED, PLEDGED, HYPOTHECATED OR ENCUMBERED, IN
WHOLE OR IN PART, WHETHER VOLUNTARILY, INVOLUNTARILY OR BY OPERATION OF LAW, OR
PERMIT THE USE OR OPERATION OF THE LEASED PROPERTY, OR ANY PORTION THEREOF, BY
ANYONE OTHER THAN TENANT, ANY MANAGER APPROVED BY LANDLORD PURSUANT TO THE
APPLICABLE PROVISIONS OF THIS AGREEMENT OR RESIDENTS AND PATIENTS OF TENANT, OR
THE LEASED PROPERTY, OR ANY PORTION THEREOF, TO BE OFFERED OR ADVERTISED FOR
ASSIGNMENT OR SUBLETTING.

 

For purposes of this Section 16.1, an assignment of this Agreement shall be
deemed to include, without limitation, any direct or indirect Change in Control
of Tenant.

 

If this Agreement is assigned or if the Leased Property, or any portion thereof,
is sublet (or occupied by anybody other than Tenant or any Manager, their
respective employees or residents or patients of Tenant), Landlord may collect
the rents from such assignee, subtenant or occupant, as the case may be, and
apply the net amount collected to the Rent herein reserved, but no such
collection shall be deemed a waiver of the provisions set forth in the first
paragraph of this Section 16.1, the acceptance by Landlord of such assignee,
subtenant or occupant, as the case may be, as a tenant, or a release of Tenant
from the future performance by Tenant of its covenants, agreements or
obligations contained in this Agreement.

 

Any assignment or transfer of Tenant’s interest under this Agreement shall be
subject to such assignee’s or transferee’s delivery to Landlord of (i) a
Guaranty, which Guaranty shall be in form and substance satisfactory to Landlord
in its sole discretion and which Guaranty shall constitute an Incidental
Document hereunder; (ii) a pledge of the stock, partnership, membership or other
ownership interests of such assignee or other transferee to secure Tenant’s
obligations under this Agreement and the Incidental Documents, which pledge
shall be in form and substance satisfactory to Landlord in its sole discretion
and which pledge shall constitute an Incidental Document hereunder; (iii) a
security agreement granting Landlord a security interest in all of such
assignee’s or transferee’s right, title and interest in and to any personal
property, intangibles and fixtures (other than accounts receivable) with respect
to any Property which is subject to any such assignment or transfer to secure
Tenant’s obligations under this Agreement and the Incidental Documents, which
security agreement shall be in form and substance satisfactory to Landlord in
its sole

 

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discretion and which security agreement shall constitute an Incidental Document
hereunder; and (iv) in the case of a sublease, an assignment which assigns all
of such subtenant’s right, title and interest in such sublease to Landlord to
secure Tenant’s obligations under this Agreement and the Incidental Documents,
which assignment shall be in form and substance satisfactory to Landlord in its
sole discretion and which assignment shall constitute an Incidental Document
hereunder.

 

No subletting or assignment shall in any way impair the continuing primary
liability of Tenant hereunder (unless Landlord and Tenant expressly otherwise
agree that Tenant shall be released from all obligations hereunder), and no
consent to any subletting or assignment in a particular instance shall be deemed
to be a waiver of the prohibition set forth in this Section 16.1.  No
assignment, subletting or occupancy shall affect any Permitted Use.  Any
subletting, assignment or other transfer of Tenant’s interest under this
Agreement in contravention of this Section 16.1 shall be voidable at Landlord’s
option.

 

16.2        REQUIRED SUBLEASE PROVISIONS.  ANY SUBLEASE OF ALL OR ANY PORTION OF
THE LEASED PROPERTY SHALL PROVIDE (A) THAT IT IS SUBJECT AND SUBORDINATE TO THIS
AGREEMENT AND TO THE MATTERS TO WHICH THIS AGREEMENT IS OR SHALL BE SUBJECT OR
SUBORDINATE; (B) THAT IN THE EVENT OF TERMINATION OF THIS AGREEMENT OR REENTRY
OR DISPOSSESSION OF TENANT BY LANDLORD UNDER THIS AGREEMENT, LANDLORD MAY, AT
ITS OPTION, TERMINATE SUCH SUBLEASE OR TAKE OVER ALL OF THE RIGHT, TITLE AND
INTEREST OF TENANT, AS SUBLESSOR UNDER SUCH SUBLEASE, AND SUCH SUBTENANT SHALL,
AT LANDLORD’S OPTION, ATTORN TO LANDLORD PURSUANT TO THE THEN EXECUTORY
PROVISIONS OF SUCH SUBLEASE, EXCEPT THAT NEITHER LANDLORD NOR ANY FACILITY
MORTGAGEE, AS HOLDER OF A MORTGAGE OR AS LANDLORD UNDER THIS AGREEMENT, IF SUCH
MORTGAGEE SUCCEEDS TO THAT POSITION, SHALL (I) BE LIABLE FOR ANY ACT OR OMISSION
OF TENANT UNDER SUCH SUBLEASE, (II) BE SUBJECT TO ANY CREDIT, COUNTERCLAIM,
OFFSET OR DEFENSE WHICH THERETOFORE ACCRUED TO SUCH SUBTENANT AGAINST TENANT,
(III) BE BOUND BY ANY PREVIOUS MODIFICATION OF SUCH SUBLEASE NOT CONSENTED TO IN
WRITING BY LANDLORD OR BY ANY PREVIOUS PREPAYMENT OF MORE THAN ONE (1) MONTH’S
RENT, (IV) BE BOUND BY ANY COVENANT OF TENANT TO UNDERTAKE OR COMPLETE ANY
CONSTRUCTION OF THE APPLICABLE PROPERTY, OR ANY PORTION THEREOF, (V) BE REQUIRED
TO ACCOUNT FOR ANY SECURITY DEPOSIT OF THE SUBTENANT OTHER THAN ANY SECURITY
DEPOSIT ACTUALLY DELIVERED TO LANDLORD BY TENANT, (VI) BE BOUND BY ANY
OBLIGATION TO MAKE ANY PAYMENT TO SUCH SUBTENANT OR GRANT ANY CREDITS, EXCEPT
FOR SERVICES, REPAIRS, MAINTENANCE AND RESTORATION PROVIDED FOR UNDER THE
SUBLEASE THAT ARE PERFORMED

 

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AFTER THE DATE OF SUCH ATTORNMENT, (VII) BE RESPONSIBLE FOR ANY MONIES OWING BY
TENANT TO THE CREDIT OF SUCH SUBTENANT UNLESS ACTUALLY DELIVERED TO LANDLORD BY
TENANT, OR (VIII) BE REQUIRED TO REMOVE ANY PERSON OCCUPYING ANY PORTION OF THE
LEASED PROPERTY; AND (C) IN THE EVENT THAT SUCH SUBTENANT RECEIVES A WRITTEN
NOTICE FROM LANDLORD OR ANY FACILITY MORTGAGEE STATING THAT AN EVENT OF DEFAULT
HAS OCCURRED AND IS CONTINUING, SUCH SUBTENANT SHALL THEREAFTER BE OBLIGATED TO
PAY ALL RENTALS ACCRUING UNDER SUCH SUBLEASE DIRECTLY TO THE PARTY GIVING SUCH
NOTICE OR AS SUCH PARTY MAY DIRECT.  ALL RENTALS RECEIVED FROM SUCH SUBTENANT BY
LANDLORD OR THE FACILITY MORTGAGEE, AS THE CASE MAY BE, SHALL BE CREDITED
AGAINST THE AMOUNTS OWING BY TENANT UNDER THIS AGREEMENT AND SUCH SUBLEASE SHALL
PROVIDE THAT THE SUBTENANT THEREUNDER SHALL, AT THE REQUEST OF LANDLORD, EXECUTE
A SUITABLE INSTRUMENT IN CONFIRMATION OF SUCH AGREEMENT TO ATTORN.  AN ORIGINAL
COUNTERPART OF EACH SUCH SUBLEASE AND ASSIGNMENT AND ASSUMPTION, DULY EXECUTED
BY TENANT AND SUCH SUBTENANT OR ASSIGNEE, AS THE CASE MAY BE, IN FORM AND
SUBSTANCE REASONABLY SATISFACTORY TO LANDLORD, SHALL BE DELIVERED PROMPTLY TO
LANDLORD AND (X) IN THE CASE OF AN ASSIGNMENT, THE ASSIGNEE SHALL ASSUME IN
WRITING AND AGREE TO KEEP AND PERFORM ALL OF THE TERMS OF THIS AGREEMENT ON THE
PART OF TENANT TO BE KEPT AND PERFORMED AND SHALL BE, AND BECOME, JOINTLY AND
SEVERALLY LIABLE WITH TENANT FOR THE PERFORMANCE THEREOF AND (Y) IN THE CASE OF
EITHER AN ASSIGNMENT OR SUBLETTING, TENANT SHALL REMAIN PRIMARILY LIABLE, AS
PRINCIPAL RATHER THAN AS SURETY, FOR THE PROMPT PAYMENT OF THE RENT AND FOR THE
PERFORMANCE AND OBSERVANCE OF ALL OF THE COVENANTS AND CONDITIONS TO BE
PERFORMED BY TENANT HEREUNDER.

 

The provisions of this Section 16.2 shall not be deemed a waiver of the
provisions set forth in the first paragraph of Section 16.1.

 

16.3        PERMITTED SUBLEASE.  NOTWITHSTANDING THE FOREGOING, INCLUDING,
WITHOUT LIMITATION, SECTION 16.2, BUT SUBJECT TO THE PROVISIONS OF SECTION 16.4
AND ANY OTHER EXPRESS CONDITIONS OR LIMITATIONS SET FORTH HEREIN, TENANT MAY, IN
EACH INSTANCE AFTER NOTICE TO LANDLORD, (A) ENTER INTO THIRD PARTY RESIDENCY
AGREEMENTS WITH RESPECT TO THE UNITS LOCATED AT THE FACILITIES, (B) SUBLEASE
SPACE AT ANY PROPERTY FOR LAUNDRY, COMMISSARY OR CHILD CARE PURPOSES OR OTHER
CONCESSIONS IN FURTHERANCE OF THE PERMITTED USE, SO LONG AS SUCH SUBLEASES WILL
NOT REDUCE THE NUMBER OF UNITS AT ANY FACILITY, WILL NOT VIOLATE OR AFFECT ANY
LEGAL REQUIREMENT OR INSURANCE REQUIREMENT, AND TENANT SHALL PROVIDE SUCH
ADDITIONAL INSURANCE COVERAGE APPLICABLE TO THE ACTIVITIES TO BE CONDUCTED IN
SUCH SUBLEASED SPACE AS LANDLORD AND ANY FACILITY MORTGAGEE MAY REASONABLY
REQUIRE, AND (C) ENTER

 

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INTO ONE OR MORE SUBLEASES WITH AFFILIATED PERSONS OF TENANT WITH RESPECT TO THE
LEASED PROPERTY, OR ANY PORTION THEREOF, PROVIDED TENANT GIVES LANDLORD NOTICE
OF THE MATERIAL TERMS AND CONDITIONS THEREOF.  LANDLORD AND TENANT ACKNOWLEDGE
AND AGREE THAT IF TENANT ENTERS INTO ONE (1) OR MORE SUBLEASES WITH AFFILIATED
PERSONS OF TENANT WITH RESPECT TO ANY PROPERTY, OR ANY PORTION THEREOF, IN
ACCORDANCE WITH THE PRECEDING CLAUSE (C), TENANT MAY ALLOCATE THE RENT AND OTHER
CHARGES WITH RESPECT TO THE AFFECTED PROPERTY IN ANY REASONABLE MANNER;
PROVIDED, HOWEVER, THAT SUCH ALLOCATION SHALL NOT AFFECT TENANT’S (NOR ANY
GUARANTOR’S) LIABILITY FOR THE RENT AND OTHER OBLIGATIONS OF TENANT UNDER THIS
AGREEMENT; AND, PROVIDED, FURTHER, THAT TENANT SHALL GIVE LANDLORD PROMPT
WRITTEN NOTICE OF ANY ALLOCATION OR REALLOCATION OF THE RENT AND OTHER CHARGES
WITH RESPECT TO THE AFFECTED PROPERTY AND, IN ANY EVENT, TENANT SHALL GIVE
LANDLORD WRITTEN NOTICE OF THE AMOUNT OF SUCH ALLOCATIONS AT LEAST TEN
(10) BUSINESS DAYS PRIOR TO THE DATE THAT LANDLORD OR SENIOR HOUSING PROPERTIES
TRUST IS REQUIRED TO FILE ANY TAX RETURNS IN ANY STATE WHERE SUCH AFFECTED
PROPERTY IS LOCATED.

 

16.4        SUBLEASE LIMITATION.  ANYTHING CONTAINED IN THIS AGREEMENT TO THE
CONTRARY NOTWITHSTANDING, TENANT SHALL NOT SUBLET THE LEASED PROPERTY, OR ANY
PORTION THEREOF, ON ANY BASIS SUCH THAT THE RENTAL TO BE PAID BY ANY SUBLESSEE
THEREUNDER WOULD BE BASED, IN WHOLE OR IN PART, ON THE NET INCOME OR PROFITS
DERIVED BY THE BUSINESS ACTIVITIES OF SUCH SUBLESSEE, ANY OTHER FORMULA SUCH
THAT ANY PORTION OF SUCH SUBLEASE RENTAL WOULD FAIL TO QUALIFY AS “RENTS FROM
REAL PROPERTY” WITHIN THE MEANING OF SECTION 856(D) OF THE CODE, OR ANY SIMILAR
OR SUCCESSOR PROVISION THERETO OR WOULD OTHERWISE DISQUALIFY LANDLORD FOR
TREATMENT AS A REAL ESTATE INVESTMENT TRUST.

 

ARTICLE 17

 

ESTOPPEL CERTIFICATES AND FINANCIAL STATEMENTS

 

17.1        ESTOPPEL CERTIFICATES.  AT ANY TIME AND FROM TIME TO TIME, BUT NOT
MORE THAN A REASONABLE NUMBER OF TIMES PER YEAR, UPON NOT LESS THAN TEN
(10) BUSINESS DAYS PRIOR NOTICE BY EITHER PARTY, THE PARTY RECEIVING SUCH NOTICE
SHALL FURNISH TO THE OTHER AN OFFICER’S CERTIFICATE CERTIFYING THAT THIS
AGREEMENT IS UNMODIFIED AND IN FULL FORCE AND EFFECT (OR THAT THIS AGREEMENT IS
IN FULL FORCE AND EFFECT AS MODIFIED AND SETTING FORTH THE MODIFICATIONS), THE
DATE TO WHICH THE RENT HAS BEEN PAID, THAT NO DEFAULT OR AN EVENT OF DEFAULT HAS
OCCURRED AND IS CONTINUING OR, IF A DEFAULT OR AN EVENT OF DEFAULT SHALL EXIST,
SPECIFYING IN REASONABLE DETAIL THE NATURE THEREOF, AND THE STEPS BEING TAKEN TO
REMEDY THE SAME, AND SUCH ADDITIONAL INFORMATION AS THE REQUESTING PARTY MAY
REASONABLY REQUEST.  ANY SUCH CERTIFICATE

 

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FURNISHED PURSUANT TO THIS SECTION 17.1 MAY BE RELIED UPON BY THE REQUESTING
PARTY, ITS LENDERS AND ANY PROSPECTIVE PURCHASER OR MORTGAGEE OF THE LEASED
PROPERTY, OR ANY PORTION THEREOF, OR THE LEASEHOLD ESTATE CREATED HEREBY.

 

17.2        FINANCIAL STATEMENTS.  TENANT SHALL FURNISH OR CAUSE FIVE STAR TO
FURNISH, AS APPLICABLE, THE FOLLOWING STATEMENTS TO LANDLORD:

 

(A)           WITHIN FORTY-FIVE (45) DAYS AFTER EACH OF THE FIRST THREE FISCAL
QUARTERS OF ANY FISCAL YEAR, THE MOST RECENT CONSOLIDATED FINANCIALS,
ACCOMPANIED BY A FINANCIAL OFFICER’S CERTIFICATE;

 

(B)           WITHIN NINETY (90) DAYS AFTER THE END OF EACH FISCAL YEAR, THE
MOST RECENT CONSOLIDATED FINANCIALS AND FINANCIALS OF TENANT FOR SUCH YEAR,
CERTIFIED BY AN INDEPENDENT CERTIFIED PUBLIC ACCOUNTANT REASONABLY SATISFACTORY
TO LANDLORD AND ACCOMPANIED BY A FINANCIAL OFFICER’S CERTIFICATE;

 

(C)           WITHIN FORTY-FIVE (45) DAYS AFTER THE END OF EACH MONTH, AN
UNAUDITED OPERATING STATEMENT AND STATEMENT OF CAPITAL EXPENDITURES PREPARED ON
A FACILITY BY FACILITY BASIS AND A COMBINED BASIS, INCLUDING OCCUPANCY
PERCENTAGES AND AVERAGE RATE, ACCOMPANIED BY A FINANCIAL OFFICER’S CERTIFICATE;

 

(D)           AT ANY TIME AND FROM TIME TO TIME UPON NOT LESS THAN TWENTY (20)
DAYS NOTICE FROM LANDLORD OR SUCH ADDITIONAL PERIOD AS MAY BE REASONABLE UNDER
THE CIRCUMSTANCES, ANY CONSOLIDATED FINANCIALS, TENANT FINANCIALS OR ANY OTHER
AUDITED OR UNAUDITED FINANCIAL REPORTING INFORMATION REQUIRED TO BE FILED BY
LANDLORD WITH ANY SECURITIES AND EXCHANGE COMMISSION, THE SEC OR ANY SUCCESSOR
AGENCY, OR ANY OTHER GOVERNMENTAL AUTHORITY, OR REQUIRED PURSUANT TO ANY ORDER
ISSUED BY ANY COURT, GOVERNMENTAL AUTHORITY OR ARBITRATOR IN ANY LITIGATION TO
WHICH LANDLORD IS A PARTY, FOR PURPOSES OF COMPLIANCE THEREWITH; PROVIDED,
HOWEVER, THAT, EXCEPT AS TO CALCULATIONS PERTAINING TO GROSS REVENUES, TENANT
SHALL NOT BE REQUIRED TO PROVIDE AUDITED FINANCIALS WITH RESPECT TO ANY
INDIVIDUAL FACILITY UNLESS LANDLORD SHALL AGREE TO PAY FOR THE COST THEREOF;

 

(E)           PROMPTLY, AFTER RECEIPT OR SENDING THEREOF, COPIES OF ALL NOTICES
GIVEN OR RECEIVED BY TENANT UNDER ANY MANAGEMENT AGREEMENT; AND

 

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(F)            PROMPTLY, UPON NOTICE FROM LANDLORD, SUCH OTHER INFORMATION
CONCERNING THE BUSINESS, FINANCIAL CONDITION AND AFFAIRS OF TENANT, ANY
GUARANTOR, AND/OR ANY AFFILIATED PARTY OF TENANT WHICH IS A PARTY TO AN LTA GMAC
LEASE AS LANDLORD REASONABLY MAY REQUEST FROM TIME TO TIME.

 

Landlord may at any time, and from time to time, provide any Facility Mortgagee
with copies of any of the foregoing statements, subject to Landlord obtaining
the agreement of such Facility Mortgagee to maintain such statements and the
information therein as confidential.

 

17.3        GENERAL OPERATIONS.  TENANT COVENANTS AND AGREES TO FURNISH TO
LANDLORD, WITHIN THIRTY (30) DAYS AFTER RECEIPT OR MODIFICATION THEREOF, COPIES
OF:

 

(A)           ALL LICENSES AUTHORIZING TENANT OR ANY MANAGER TO OPERATE ANY
FACILITY FOR ITS PERMITTED USE;

 

(B)           ALL MEDICARE AND MEDICAID CERTIFICATIONS, TOGETHER WITH PROVIDER
AGREEMENTS AND ALL MATERIAL CORRESPONDENCE RELATING THERETO WITH RESPECT TO ANY
FACILITY (EXCLUDING, HOWEVER, CORRESPONDENCE WHICH MAY BE SUBJECT TO ANY
ATTORNEY CLIENT PRIVILEGE);

 

(C)           IF REQUIRED UNDER APPLICABLE LAW WITH RESPECT TO ANY FACILITY, A
LICENSE FOR EACH INDIVIDUAL EMPLOYED AS ADMINISTRATOR WITH RESPECT TO SUCH
FACILITY;

 

(D)           ALL REPORTS OF SURVEYS, STATEMENTS OF DEFICIENCIES, PLANS OF
CORRECTION, AND ALL MATERIAL CORRESPONDENCE RELATING THERETO, INCLUDING, WITHOUT
LIMITATION, ALL REPORTS AND MATERIAL CORRESPONDENCE CONCERNING COMPLIANCE WITH
OR ENFORCEMENT OF LICENSURE, MEDICARE/MEDICAID, AND ACCREDITATION REQUIREMENTS,
INCLUDING PHYSICAL ENVIRONMENT AND LIFE SAFETY CODE SURVEY REPORTS (EXCLUDING,
HOWEVER, CORRESPONDENCE WHICH MAY BE SUBJECT TO ANY ATTORNEY CLIENT PRIVILEGE);
AND

 

(E)           WITH REASONABLE PROMPTNESS, SUCH OTHER CONFIRMATION AS TO THE
LICENSURE AND MEDICARE AND MEDICAID PARTICIPATION OF TENANT AS LANDLORD MAY
REASONABLY REQUEST FROM TIME TO TIME.

 

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ARTICLE 18

 

LANDLORD’S RIGHT TO INSPECT

 

Tenant shall permit Landlord and its authorized representatives to inspect the
Leased Property, or any portion thereof, during usual business hours upon not
less than forty-eight (48) hours’ notice and to make such repairs as Landlord is
permitted or required to make pursuant to the terms of this Agreement, provided
that any inspection or repair by Landlord or its representatives will not
unreasonably interfere with Tenant’s use and operation of the Leased Property
and further provided that in the event of an emergency, as determined by
Landlord in its reasonable discretion, prior Notice shall not be necessary.

 

ARTICLE 19

 

EASEMENTS

 

19.1        GRANT OF EASEMENTS.  PROVIDED NO EVENT OF DEFAULT HAS OCCURRED AND
IS CONTINUING, LANDLORD WILL JOIN IN GRANTING AND, IF NECESSARY, MODIFYING OR
ABANDONING SUCH RIGHTS-OF-WAY, EASEMENTS AND OTHER INTERESTS AS MAY BE
REASONABLY REQUESTED BY TENANT FOR INGRESS AND EGRESS, AND ELECTRIC, TELEPHONE,
GAS, WATER, SEWER AND OTHER UTILITIES SO LONG AS:

 

(A)           THE INSTRUMENT CREATING, MODIFYING OR ABANDONING ANY SUCH
EASEMENT, RIGHT-OF-WAY OR OTHER INTEREST IS SATISFACTORY TO AND APPROVED BY
LANDLORD (WHICH APPROVAL SHALL NOT BE UNREASONABLY WITHHELD, DELAYED OR
CONDITIONED);

 

(B)           LANDLORD RECEIVES AN OFFICER’S CERTIFICATE FROM TENANT STATING
(I) THAT SUCH GRANT, MODIFICATION OR ABANDONMENT IS NOT DETRIMENTAL TO THE
PROPER CONDUCT OF BUSINESS ON SUCH PROPERTY, (II) THE CONSIDERATION, IF ANY,
BEING PAID FOR SUCH GRANT, MODIFICATION OR ABANDONMENT (WHICH CONSIDERATION
SHALL BE PAID BY TENANT), (III) THAT SUCH GRANT, MODIFICATION OR ABANDONMENT
DOES NOT IMPAIR THE USE OR VALUE OF SUCH PROPERTY FOR THE PERMITTED USE, AND
(IV) THAT, FOR AS LONG AS THIS AGREEMENT SHALL BE IN EFFECT, TENANT WILL PERFORM
ALL OBLIGATIONS, IF ANY, OF LANDLORD UNDER ANY SUCH INSTRUMENT; AND

 

(C)           LANDLORD RECEIVES EVIDENCE SATISFACTORY TO LANDLORD THAT THE
MANAGER HAS GRANTED ITS CONSENT TO SUCH GRANT, MODIFICATION OR ABANDONMENT IN
ACCORDANCE WITH THE

 

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REQUIREMENTS OF SUCH MANAGER’S MANAGEMENT AGREEMENT OR THAT SUCH CONSENT IS NOT
REQUIRED.

 

19.2        EXERCISE OF RIGHTS BY TENANT.  SO LONG AS NO EVENT OF DEFAULT HAS
OCCURRED AND IS CONTINUING, TENANT SHALL HAVE THE RIGHT TO EXERCISE ALL RIGHTS
OF LANDLORD UNDER THE EASEMENT AGREEMENTS AND, IN CONNECTION THEREWITH, LANDLORD
SHALL EXECUTE AND PROMPTLY RETURN TO TENANT SUCH DOCUMENTS AS TENANT SHALL
REASONABLY REQUEST.  TENANT SHALL PERFORM ALL OBLIGATIONS OF LANDLORD UNDER THE
EASEMENT AGREEMENTS.

 

19.3        PERMITTED ENCUMBRANCES.  ANY AGREEMENTS ENTERED INTO IN ACCORDANCE
WITH THIS ARTICLE 19 SHALL BE DEEMED A PERMITTED ENCUMBRANCE.

 

ARTICLE 20

 

FACILITY MORTGAGES

 

20.1        LANDLORD MAY GRANT LIENS.  WITHOUT THE CONSENT OF TENANT, LANDLORD
MAY, FROM TIME TO TIME, DIRECTLY OR INDIRECTLY, CREATE OR OTHERWISE CAUSE TO
EXIST ANY LIEN, ENCUMBRANCE OR TITLE RETENTION AGREEMENT (“ENCUMBRANCE”) UPON
THE LEASED PROPERTY, OR ANY PORTION THEREOF, OR INTEREST THEREIN, WHETHER TO
SECURE ANY BORROWING OR OTHER MEANS OF FINANCING OR REFINANCING.

 

20.2        SUBORDINATION OF LEASE.  THIS AGREEMENT AND ANY AND ALL RIGHTS OF
TENANT HEREUNDER ARE AND SHALL BE SUBJECT AND SUBORDINATE TO ANY GROUND OR
MASTER LEASE, AND ALL RENEWALS, EXTENSIONS, MODIFICATIONS AND REPLACEMENTS
THEREOF, AND TO ALL MORTGAGES AND DEEDS OF TRUST, WHICH MAY NOW OR HEREAFTER
AFFECT THE LEASED PROPERTY, OR ANY PORTION THEREOF, OR ANY IMPROVEMENTS THEREON
AND/OR ANY OF SUCH LEASES, WHETHER OR NOT SUCH MORTGAGES OR DEEDS OF TRUST SHALL
ALSO COVER OTHER LANDS AND/OR BUILDINGS AND/OR LEASES, TO EACH AND EVERY ADVANCE
MADE OR HEREAFTER TO BE MADE UNDER SUCH MORTGAGES AND DEEDS OF TRUST, AND TO ALL
RENEWALS, MODIFICATIONS, REPLACEMENTS AND EXTENSIONS OF SUCH LEASES AND SUCH
MORTGAGES AND DEEDS OF TRUST AND ALL CONSOLIDATIONS OF SUCH MORTGAGES AND DEEDS
OF TRUST.  THIS SECTION SHALL BE SELF-OPERATIVE AND NO FURTHER INSTRUMENT OF
SUBORDINATION SHALL BE REQUIRED.  IN CONFIRMATION OF SUCH SUBORDINATION, TENANT
SHALL PROMPTLY EXECUTE, ACKNOWLEDGE AND DELIVER ANY INSTRUMENT THAT LANDLORD,
THE LESSOR UNDER ANY SUCH LEASE OR THE HOLDER OF ANY SUCH MORTGAGE OR THE
TRUSTEE OR BENEFICIARY OF ANY DEED OF TRUST OR ANY OF THEIR RESPECTIVE
SUCCESSORS IN INTEREST MAY REASONABLY REQUEST TO EVIDENCE SUCH SUBORDINATION. 
ANY LEASE TO WHICH THIS AGREEMENT IS, AT THE TIME REFERRED TO, SUBJECT AND
SUBORDINATE IS HEREIN CALLED

 

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“SUPERIOR LEASE” AND THE LESSOR OF A SUPERIOR LEASE OR ITS SUCCESSOR IN INTEREST
AT THE TIME REFERRED TO IS HEREIN CALLED “SUPERIOR LANDLORD” AND ANY MORTGAGE OR
DEED OF TRUST TO WHICH THIS AGREEMENT IS, AT THE TIME REFERRED TO, SUBJECT AND
SUBORDINATE IS HEREIN CALLED “SUPERIOR MORTGAGE” AND THE HOLDER, TRUSTEE OR
BENEFICIARY OF A SUPERIOR MORTGAGE IS HEREIN CALLED “SUPERIOR MORTGAGEE”. 
TENANT SHALL HAVE NO OBLIGATIONS UNDER ANY SUPERIOR LEASE OR SUPERIOR MORTGAGE
OTHER THAN THOSE EXPRESSLY SET FORTH IN THIS SECTION 20.2.

 

If any Superior Landlord or Superior Mortgagee or the nominee or designee of any
Superior Landlord or Superior Mortgagee shall succeed to the rights of Landlord
under this Agreement (any such person, “Successor Landlord”), whether through
possession or foreclosure action or delivery of a new lease or deed, or
otherwise, at such Successor Landlord’s request, Tenant shall attorn to and
recognize the Successor Landlord as Tenant’s landlord under this Agreement and
Tenant shall promptly execute and deliver any instrument that such Successor
Landlord may reasonably request to evidence such attornment (provided that such
instrument does not alter the terms of this Agreement), whereupon, this
Agreement shall continue in full force and effect as a direct lease between the
Successor Landlord and Tenant upon all of the terms, conditions and covenants as
are set forth in this Agreement, except that the Successor Landlord (unless
formerly the landlord under this Agreement or its nominee or designee) shall not
be (a) liable in any way to Tenant for any act or omission, neglect or default
on the part of any prior Landlord under this Agreement, (b) responsible for any
monies owing by or on deposit with any prior Landlord to the credit of Tenant
(except to the extent actually paid or delivered to the Successor Landlord),
(c) subject to any counterclaim or setoff which theretofore accrued to Tenant
against any prior Landlord, (d) bound by any modification of this Agreement
subsequent to such Superior Lease or Mortgage, or by any previous prepayment of
Rent for more than one (1) month in advance of the date due hereunder, which was
not approved in writing by the Superior Landlord or the Superior Mortgagee
thereto, (e) liable to Tenant beyond the Successor Landlord’s interest in the
Leased Property and the rents, income, receipts, revenues, issues and profits
issuing from the Leased Property, (f) responsible for the performance of any
work to be done by the Landlord under this Agreement to render the Leased
Property ready for occupancy by Tenant (subject to Landlord’s obligations under
Section 5.1.2(b) or with respect to any insurance or Condemnation proceeds), or
(g) required to remove any Person occupying the Leased Property or any part
thereof, except if such person claims by, through or under the Successor
Landlord. 

 

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Tenant agrees at any time and from time to time to execute a suitable instrument
in confirmation of Tenant’s agreement to attorn, as aforesaid and Landlord
agrees to provide Tenant with an instrument of nondisturbance and attornment
from each such Superior Mortgagee and Superior Landlord (other than the lessors
under any ground leases with respect to the Leased Property, or any portion
thereof) in form and substance reasonably satisfactory to Tenant. 
Notwithstanding the foregoing, any Successor Landlord shall be liable (a) to pay
to Tenant any amounts owed under Section 5.1.2(b), and (b) to pay to Tenant any
portions of insurance proceeds or Awards received by Landlord or the Successor
Landlord required to be paid to Tenant pursuant to the terms of this Agreement,
and, as a condition to any mortgage, lien or lease in respect of the Leased
Property, or any portion thereof, and the subordination of this Agreement
thereto, the mortgagee, lienholder or lessor, as applicable, shall expressly
agree, for the benefit of Tenant, to make such payments, which agreement shall
be embodied in an instrument in form reasonably satisfactory to Tenant.

 

20.3        NOTICE TO MORTGAGEE AND SUPERIOR LANDLORD.  SUBSEQUENT TO THE
RECEIPT BY TENANT OF NOTICE FROM LANDLORD AS TO THE IDENTITY OF ANY FACILITY
MORTGAGEE OR SUPERIOR LANDLORD UNDER A LEASE WITH LANDLORD, AS GROUND LESSEE,
WHICH INCLUDES THE LEASED PROPERTY, OR ANY PORTION THEREOF, AS PART OF THE
DEMISED PREMISES AND WHICH COMPLIES WITH SECTION 20.1 (WHICH NOTICE SHALL BE
ACCOMPANIED BY A COPY OF THE APPLICABLE MORTGAGE OR LEASE), NO NOTICE FROM
TENANT TO LANDLORD AS TO A DEFAULT BY LANDLORD UNDER THIS AGREEMENT SHALL BE
EFFECTIVE WITH RESPECT TO A FACILITY MORTGAGEE OR SUPERIOR LANDLORD UNLESS AND
UNTIL A COPY OF THE SAME IS GIVEN TO SUCH FACILITY MORTGAGEE OR SUPERIOR
LANDLORD AT THE ADDRESS SET FORTH IN THE ABOVE DESCRIBED NOTICE, AND THE CURING
OF ANY OF LANDLORD’S DEFAULTS WITHIN THE APPLICABLE NOTICE AND CURE PERIODS SET
FORTH IN ARTICLE 14 BY SUCH FACILITY MORTGAGEE OR SUPERIOR LANDLORD SHALL BE
TREATED AS PERFORMANCE BY LANDLORD.

 

ARTICLE 21

 

ADDITIONAL COVENANTS OF TENANT

 

21.1        PROMPT PAYMENT OF INDEBTEDNESS.  TENANT SHALL (A) PAY OR CAUSE TO BE
PAID WHEN DUE ALL PAYMENTS OF PRINCIPAL OF AND PREMIUM AND INTEREST ON TENANT’S
INDEBTEDNESS FOR MONEY BORROWED AND SHALL NOT PERMIT OR SUFFER ANY SUCH
INDEBTEDNESS TO BECOME OR REMAIN IN DEFAULT BEYOND ANY APPLICABLE GRACE OR CURE
PERIOD, (B) PAY OR CAUSE TO BE PAID WHEN DUE ALL LAWFUL CLAIMS FOR LABOR AND
RENTS WITH RESPECT TO THE LEASED PROPERTY, (C) PAY OR CAUSE TO BE PAID WHEN DUE
ALL TRADE PAYABLES AND (D) PAY OR CAUSE TO

 

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BE PAID WHEN DUE ALL OTHER OF TENANT’S INDEBTEDNESS UPON WHICH IT IS OR BECOMES
OBLIGATED, EXCEPT, IN EACH CASE, OTHER THAN THAT REFERRED TO IN CLAUSE (A), TO
THE EXTENT PAYMENT IS BEING CONTESTED IN GOOD FAITH BY APPROPRIATE PROCEEDINGS
IN ACCORDANCE WITH ARTICLE 8 AND IF TENANT SHALL HAVE SET ASIDE ON ITS BOOKS
ADEQUATE RESERVES WITH RESPECT THERETO IN ACCORDANCE WITH GAAP, IF APPROPRIATE,
OR UNLESS AND UNTIL FORECLOSURE, DISTRAINT SALE OR OTHER SIMILAR PROCEEDINGS
SHALL HAVE BEEN COMMENCED.

 

21.2        CONDUCT OF BUSINESS.  TENANT SHALL NOT ENGAGE IN ANY BUSINESS OTHER
THAN THE LEASING AND OPERATION OF THE LEASED PROPERTY (INCLUDING ANY INCIDENTAL
OR ANCILLARY BUSINESS RELATING THERETO) AND THE LEASING AND OPERATION OF THE
LEASED PROPERTY UNDER MASTER LEASE AGREEMENT NO. 3 (INCLUDING ANY INCIDENTAL OR
ANCILLARY BUSINESS RELATING THERETO).  TENANT SHALL DO OR CAUSE TO BE DONE ALL
THINGS NECESSARY TO PRESERVE, RENEW AND KEEP IN FULL FORCE AND EFFECT AND IN
GOOD STANDING ITS CORPORATE EXISTENCE AND ITS RIGHTS AND LICENSES NECESSARY TO
CONDUCT SUCH BUSINESS.

 

21.3        MAINTENANCE OF ACCOUNTS AND RECORDS.  TENANT SHALL KEEP TRUE RECORDS
AND BOOKS OF ACCOUNT OF TENANT IN WHICH FULL, TRUE AND CORRECT ENTRIES WILL BE
MADE OF DEALINGS AND TRANSACTIONS IN RELATION TO THE BUSINESS AND AFFAIRS OF
TENANT IN ACCORDANCE WITH GAAP.  TENANT SHALL APPLY ACCOUNTING PRINCIPLES IN THE
PREPARATION OF THE FINANCIAL STATEMENTS OF TENANT WHICH, IN THE JUDGMENT OF AND
THE OPINION OF ITS INDEPENDENT PUBLIC ACCOUNTANTS, ARE IN ACCORDANCE WITH GAAP,
WHERE APPLICABLE, EXCEPT FOR CHANGES APPROVED BY SUCH INDEPENDENT PUBLIC
ACCOUNTANTS.  TENANT SHALL PROVIDE TO LANDLORD EITHER IN A FOOTNOTE TO THE
FINANCIAL STATEMENTS DELIVERED UNDER SECTION 17.2 WHICH RELATE TO THE PERIOD IN
WHICH SUCH CHANGE OCCURS, OR IN SEPARATE SCHEDULES TO SUCH FINANCIAL STATEMENTS,
INFORMATION SUFFICIENT TO SHOW THE EFFECT OF ANY SUCH CHANGES ON SUCH FINANCIAL
STATEMENTS.

 

21.4        NOTICE OF LITIGATION, ETC.  TENANT SHALL GIVE PROMPT NOTICE TO
LANDLORD OF ANY LITIGATION OR ANY ADMINISTRATIVE PROCEEDING TO WHICH IT MAY
HEREAFTER BECOME A PARTY OF WHICH TENANT HAS NOTICE OR ACTUAL KNOWLEDGE WHICH
INVOLVES A POTENTIAL LIABILITY EQUAL TO OR GREATER THAN TWO HUNDRED FIFTY
THOUSAND DOLLARS ($250,000) OR WHICH MAY OTHERWISE RESULT IN ANY MATERIAL
ADVERSE CHANGE IN THE BUSINESS, OPERATIONS, PROPERTY, PROSPECTS, RESULTS OF
OPERATION OR CONDITION, FINANCIAL OR OTHER, OF TENANT.  FORTHWITH UPON TENANT
OBTAINING KNOWLEDGE OF ANY DEFAULT, EVENT OF DEFAULT OR ANY DEFAULT OR EVENT OF
DEFAULT UNDER ANY AGREEMENT RELATING TO INDEBTEDNESS FOR MONEY BORROWED IN AN
AGGREGATE AMOUNT EXCEEDING, AT ANY ONE TIME, TWO HUNDRED FIFTY THOUSAND DOLLARS
($250,000), OR ANY EVENT OR CONDITION

 

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THAT WOULD BE REQUIRED TO BE DISCLOSED IN A CURRENT REPORT FILED BY TENANT ON
FORM 8-K OR IN PART II OF A QUARTERLY REPORT ON FORM 10-Q IF TENANT WERE
REQUIRED TO FILE SUCH REPORTS UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS
AMENDED, TENANT SHALL FURNISH NOTICE THEREOF TO LANDLORD SPECIFYING THE NATURE
AND PERIOD OF EXISTENCE THEREOF AND WHAT ACTION TENANT HAS TAKEN OR IS TAKING OR
PROPOSES TO TAKE WITH RESPECT THERETO.

 

21.5        INDEBTEDNESS OF TENANT.  TENANT SHALL NOT CREATE, INCUR, ASSUME OR
GUARANTEE, OR PERMIT TO EXIST, OR BECOME OR REMAIN LIABLE DIRECTLY OR INDIRECTLY
UPON, ANY INDEBTEDNESS EXCEPT THE FOLLOWING:

 

(A)           INDEBTEDNESS OF TENANT TO LANDLORD;

 

(B)           INDEBTEDNESS OF TENANT FOR IMPOSITIONS, TO THE EXTENT THAT PAYMENT
THEREOF SHALL NOT AT THE TIME BE REQUIRED TO BE MADE IN ACCORDANCE WITH THE
PROVISIONS OF ARTICLE 8;

 

(C)           INDEBTEDNESS OF TENANT IN RESPECT OF JUDGMENTS OR AWARDS (I) WHICH
HAVE BEEN IN FORCE FOR LESS THAN THE APPLICABLE APPEAL PERIOD AND IN RESPECT OF
WHICH EXECUTION THEREOF SHALL HAVE BEEN STAYED PENDING SUCH APPEAL OR REVIEW, OR
(II) WHICH ARE FULLY COVERED BY INSURANCE PAYABLE TO TENANT, OR (III) WHICH ARE
FOR AN AMOUNT NOT IN EXCESS OF $250,000 IN THE AGGREGATE AT ANY ONE TIME
OUTSTANDING AND (X) WHICH HAVE BEEN IN FORCE FOR NOT LONGER THAN THE APPLICABLE
APPEAL PERIOD, SO LONG AS EXECUTION IS NOT LEVIED THEREUNDER OR (Y) IN RESPECT
OF WHICH AN APPEAL OR PROCEEDINGS FOR REVIEW SHALL AT THE TIME BE PROSECUTED IN
GOOD FAITH IN ACCORDANCE WITH THE PROVISIONS OF ARTICLE 8, AND IN RESPECT OF
WHICH EXECUTION THEREOF SHALL HAVE BEEN STAYED PENDING SUCH APPEAL OR REVIEW;

 

(D)           UNSECURED BORROWINGS OF TENANT FROM ITS AFFILIATED PERSONS WHICH
ARE BY THEIR TERMS EXPRESSLY SUBORDINATE PURSUANT TO A SUBORDINATION AGREEMENT
TO THE PAYMENT AND PERFORMANCE OF TENANT’S OBLIGATIONS UNDER THIS AGREEMENT;

 

(E)           INDEBTEDNESS FOR PURCHASE MONEY FINANCING IN ACCORDANCE WITH
SECTION 21.8(A) AND OTHER OPERATING LIABILITIES INCURRED IN THE ORDINARY COURSE
OF TENANT’S BUSINESS;

 

(F)            INDEBTEDNESS OF TENANT AS GUARANTOR OR BORROWER SECURED BY LIENS
PERMITTED UNDER SECTION 21.8(C);

 

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(G)           INDEBTEDNESS OF TENANT PERMITTED UNDER MASTER LEASE AGREEMENT
NO. 3; OR

 

(H)           A GUARANTY OF FIVE STAR’S OBLIGATIONS UNDER ITS REVOLVING LINE OF
CREDIT.

 

21.6        DISTRIBUTIONS, PAYMENTS TO AFFILIATED PERSONS, ETC.  TENANT SHALL
NOT DECLARE, ORDER, PAY OR MAKE, DIRECTLY OR INDIRECTLY, ANY DISTRIBUTIONS OR
ANY PAYMENT TO ANY AFFILIATED PERSON OF TENANT (INCLUDING PAYMENTS IN THE
ORDINARY COURSE OF BUSINESS) OR SET APART ANY SUM OR PROPERTY THEREFOR, OR AGREE
TO DO SO, IF, AT THE TIME OF SUCH PROPOSED ACTION, OR IMMEDIATELY AFTER GIVING
EFFECT THERETO, ANY EVENT OF DEFAULT SHALL HAVE OCCURRED AND BE CONTINUING. 
OTHERWISE, AS LONG AS NO EVENT OF DEFAULT SHALL HAVE OCCURRED AND BE CONTINUING,
TENANT MAY MAKE DISTRIBUTIONS AND PAYMENTS TO AFFILIATED PERSONS; PROVIDED,
HOWEVER, THAT ANY SUCH PAYMENTS SHALL AT ALL TIMES BE SUBORDINATE TO TENANT’S
OBLIGATIONS UNDER THIS AGREEMENT.

 

21.7        PROHIBITED TRANSACTIONS.  TENANT SHALL NOT PERMIT TO EXIST OR ENTER
INTO ANY AGREEMENT OR ARRANGEMENT WHEREBY IT ENGAGES IN A TRANSACTION OF ANY
KIND WITH ANY AFFILIATED PERSON AS TO TENANT OR ANY GUARANTOR, EXCEPT ON TERMS
AND CONDITIONS WHICH ARE COMMERCIALLY REASONABLE.

 

21.8        LIENS AND ENCUMBRANCES.  EXCEPT AS PERMITTED BY SECTION 7.1,
SECTION 21.5 AND MASTER LEASE AGREEMENT NO. 3, TENANT SHALL NOT CREATE OR INCUR
OR SUFFER TO BE CREATED OR INCURRED OR TO EXIST ANY LIEN ON THIS AGREEMENT OR
ANY OF TENANT’S ASSETS, PROPERTIES, RIGHTS OR INCOME, OR ANY OF ITS INTEREST
THEREIN, NOW OR AT ANY TIME HEREAFTER OWNED, OTHER THAN:

 

(A)           SECURITY INTERESTS SECURING THE PURCHASE PRICE OF EQUIPMENT OR
PERSONAL PROPERTY WHETHER ACQUIRED BEFORE OR AFTER THE APPLICABLE COMMENCEMENT
DATE FOR ANY PROPERTY; PROVIDED, HOWEVER, THAT (I) SUCH LIEN SHALL AT ALL TIMES
BE CONFINED SOLELY TO THE ASSET IN QUESTION AND (II) THE AGGREGATE PRINCIPAL
AMOUNT OF INDEBTEDNESS SECURED BY ANY SUCH LIEN SHALL NOT EXCEED THE COST OF
ACQUISITION OR CONSTRUCTION OF THE PROPERTY SUBJECT THERETO;

 

(B)           PERMITTED ENCUMBRANCES;

 

(C)           SECURITY INTERESTS IN ACCOUNTS OR CHATTEL PAPER, IN SUPPORT
OBLIGATIONS, GENERAL INTANGIBLES OR DEPOSIT ACCOUNTS RELATING TO SUCH ACCOUNTS
OR CHATTEL PAPER, IN ANY INSTRUMENTS OR INVESTMENT PROPERTY EVIDENCING OR
ARISING FROM SUCH ACCOUNTS OR CHATTEL PAPER, IN ANY DOCUMENTS,

 

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BOOKS, RECORDS OR OTHER INFORMATION (INCLUDING, WITHOUT LIMITATION, COMPUTER
PROGRAMS, TAPES, DISCS, PUNCH CARDS, DATA PROCESSING SOFTWARE AND RELATED
PROPERTY AND RIGHTS) MAINTAINED WITH RESPECT TO ANY PROPERTY DESCRIBED IN THIS
SECTION 21.8(C) OR IN ANY PROCEEDS OF ANY OF THE FOREGOING (CAPITALIZED TERMS
USED IN THIS SECTION 21.8(C) WITHOUT DEFINITION BEING USED AS DEFINED IN OR FOR
PURPOSES OF ARTICLE 9 OF THE UNIFORM COMMERCIAL CODE AS IN EFFECT IN THE
COMMONWEALTH OF MASSACHUSETTS); AND

 

(D)           AS PERMITTED PURSUANT TO SECTION 21.5.

 

21.9        MERGER; SALE OF ASSETS; ETC.  WITHOUT LANDLORD’S PRIOR WRITTEN
CONSENT (WHICH CONSENT MAY BE GIVEN OR WITHHELD IN LANDLORD’S SOLE DISCRETION),
TENANT SHALL NOT (I) SELL, LEASE (AS LESSOR OR SUBLESSOR), TRANSFER OR OTHERWISE
DISPOSE OF, OR ABANDON, ALL OR ANY MATERIAL PORTION OF ITS ASSETS (INCLUDING
CAPITAL STOCK OR OTHER EQUITY INTERESTS) OR BUSINESS TO ANY PERSON, (II) MERGE
INTO OR WITH OR CONSOLIDATE WITH ANY OTHER ENTITY, OR (III) SELL, LEASE (AS
LESSOR OR SUBLESSOR), TRANSFER OR OTHERWISE DISPOSE OF, OR ABANDON, ANY PERSONAL
PROPERTY OR FIXTURES OR ANY REAL PROPERTY; PROVIDED, HOWEVER, THAT,
NOTWITHSTANDING THE PROVISIONS OF CLAUSE (III) PRECEDING, TENANT MAY DISPOSE OF
EQUIPMENT OR FIXTURES WHICH HAVE BECOME INADEQUATE, OBSOLETE, WORN-OUT,
UNSUITABLE, UNDESIRABLE OR UNNECESSARY, PROVIDED SUBSTITUTE EQUIPMENT OR
FIXTURES HAVING EQUAL OR GREATER VALUE AND UTILITY (BUT NOT NECESSARILY HAVING
THE SAME FUNCTION) HAVE BEEN PROVIDED.

 

21.10      LTA GMAC PROPERTIES.  LANDLORD AND TENANT EXPRESSLY ACKNOWLEDGE AND
AGREE THAT, EFFECTIVE AUTOMATICALLY UPON THE RELEASE OF ANY LTA GMAC PROPERTY
FROM THE APPLICABLE GMAC FINANCING (AS SUCH TERM IS DEFINED IN THE LTA GMAC
LEASES), SUCH LTA GMAC PROPERTY SHALL BE ADDED TO AND DEMISED UNDER THIS
AGREEMENT IN ACCORDANCE WITH THE TERMS AND CONDITIONS HEREOF, THE MINIMUM RENT
PAYABLE HEREUNDER SHALL BE RATABLY INCREASED BY AN AMOUNT DETERMINED BY
LANDLORD, AND THE MINIMUM RENT, AS DEFINED THEREIN, UNDER THE APPLICABLE LTA
GMAC LEASE SHALL BE REDUCED BY THE AMOUNT OF SUCH INCREASE.  THE ADDITION OF ANY
SUCH LTA GMAC PROPERTY IN ACCORDANCE WITH THE TERMS HEREOF SHALL BE AUTOMATIC
WITHOUT ANY REQUIREMENT THAT LANDLORD OR TENANT TAKE ANY ACTION OR EXECUTE ANY
DOCUMENT, INSTRUMENT, AMENDMENT OR CONFIRMATION WITH RESPECT THERETO. 
NOTWITHSTANDING THE FOREGOING, LANDLORD AND TENANT SHALL EXECUTE AND DELIVER
SUCH DOCUMENTS, INSTRUMENTS, AGREEMENTS AND CONFIRMATIONS AS THE OTHER PARTY
SHALL REASONABLY REQUEST WITH RESPECT TO THE FOREGOING.

 

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ARTICLE 22

 

ARBITRATION

 

Landlord or Tenant may elect to submit any dispute hereunder that has an amount
in controversy in excess of $250,000 to arbitration hereunder.  Any such
arbitration shall be conducted in Boston, Massachusetts in accordance with the
Commercial Arbitration Rules of the American Association then pertaining and the
decision of the arbitrators with respect to such dispute shall be binding, final
and conclusive on the parties.

 

In the event Landlord or Tenant shall elect to submit any such dispute to
arbitration hereunder, Landlord and Tenant shall each appoint and pay all fees
of a fit and impartial person as arbitrator with at least ten (10) years’ recent
professional experience in the general subject matter of the dispute.  Notice of
such appointment shall be sent in writing by each party to the other, and the
arbitrators so appointed, in the event of their failure to agree within thirty
(30) days after the appointment of the second arbitrator upon the matter so
submitted, shall appoint a third arbitrator.  If either Landlord or Tenant shall
fail to appoint an arbitrator, as aforesaid, for a period of twenty (20) days
after written notice from the other party to make such appointment, then the
arbitrator appointed by the party having made such appointment shall appoint a
second arbitrator and the two (2) so appointed shall, in the event of their
failure to agree upon any decision within thirty (30) days thereafter, appoint a
third arbitrator.  If such arbitrators fail to agree upon a third arbitrator
within forty five (45) days after the appointment of the second arbitrator, then
such third arbitrator shall be appointed by the American Arbitration Association
from its qualified panel of arbitrators, and shall be a person having at least
ten (10) years’ recent professional experience as to the subject matter in
question.  The fees of the third arbitrator and the expenses incident to the
proceedings shall be borne equally between Landlord and Tenant, unless the
arbitrators decide otherwise.  The fees of respective counsel engaged by the
parties, and the fees of expert witnesses and other witnesses called for the
parties, shall be paid by the respective party engaging such counsel or calling
or engaging such witnesses.

 

The decision of the arbitrators shall be rendered within thirty (30) days after
appointment of the third arbitrator.  Such decision shall be in writing and in
duplicate, one counterpart thereof to be delivered to Landlord and one to

 

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Tenant.  A judgment of a court of competent jurisdiction may be entered upon the
award of the arbitrators in accordance with the rules and statutes applicable
thereto then obtaining.

 

Landlord and Tenant acknowledge and agree that, to the extent any such dispute
shall involve any Manager and be subject to arbitration pursuant to such
Manager’s Management Agreement, Landlord and Tenant shall cooperate to
consolidate any such arbitration hereunder and under such Management Agreement
into a single proceeding.

 

ARTICLE 23

 

MISCELLANEOUS

 

23.1        LIMITATION ON PAYMENT OF RENT.  ALL AGREEMENTS BETWEEN LANDLORD AND
TENANT HEREIN ARE HEREBY EXPRESSLY LIMITED SO THAT IN NO CONTINGENCY OR EVENT
WHATSOEVER, WHETHER BY REASON OF ACCELERATION OF RENT, OR OTHERWISE, SHALL THE
RENT OR ANY OTHER AMOUNTS PAYABLE TO LANDLORD UNDER THIS AGREEMENT EXCEED THE
MAXIMUM PERMISSIBLE UNDER APPLICABLE LAW, THE BENEFIT OF WHICH MAY BE ASSERTED
BY TENANT AS A DEFENSE, AND IF, FROM ANY CIRCUMSTANCE WHATSOEVER, FULFILLMENT OF
ANY PROVISION OF THIS AGREEMENT, AT THE TIME PERFORMANCE OF SUCH PROVISION SHALL
BE DUE, SHALL INVOLVE TRANSCENDING THE LIMIT OF VALIDITY PRESCRIBED BY LAW, OR
IF FROM ANY CIRCUMSTANCES LANDLORD SHOULD EVER RECEIVE AS FULFILLMENT OF SUCH
PROVISION SUCH AN EXCESSIVE AMOUNT, THEN, IPSO FACTO, THE AMOUNT WHICH WOULD BE
EXCESSIVE SHALL BE APPLIED TO THE REDUCTION OF THE INSTALLMENT(S) OF MINIMUM
RENT NEXT DUE AND NOT TO THE PAYMENT OF SUCH EXCESSIVE AMOUNT.  THIS PROVISION
SHALL CONTROL EVERY OTHER PROVISION OF THIS AGREEMENT AND ANY OTHER AGREEMENTS
BETWEEN LANDLORD AND TENANT.

 

23.2        NO WAIVER.  NO FAILURE BY LANDLORD OR TENANT TO INSIST UPON THE
STRICT PERFORMANCE OF ANY TERM HEREOF OR TO EXERCISE ANY RIGHT, POWER OR REMEDY
CONSEQUENT UPON A BREACH THEREOF, AND NO ACCEPTANCE OF FULL OR PARTIAL PAYMENT
OF RENT DURING THE CONTINUANCE OF ANY SUCH BREACH, SHALL CONSTITUTE A WAIVER OF
ANY SUCH BREACH OR OF ANY SUCH TERM.  TO THE MAXIMUM EXTENT PERMITTED BY LAW, NO
WAIVER OF ANY BREACH SHALL AFFECT OR ALTER THIS AGREEMENT, WHICH SHALL CONTINUE
IN FULL FORCE AND EFFECT WITH RESPECT TO ANY OTHER THEN EXISTING OR SUBSEQUENT
BREACH.

 

23.3        REMEDIES CUMULATIVE.  TO THE MAXIMUM EXTENT PERMITTED BY LAW, EACH
LEGAL, EQUITABLE OR CONTRACTUAL RIGHT, POWER AND REMEDY OF LANDLORD OR TENANT,
NOW OR HEREAFTER PROVIDED EITHER IN THIS AGREEMENT OR BY STATUTE OR OTHERWISE,
SHALL BE CUMULATIVE AND CONCURRENT AND SHALL BE IN ADDITION TO EVERY

 

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OTHER RIGHT, POWER AND REMEDY AND THE EXERCISE OR BEGINNING OF THE EXERCISE BY
LANDLORD OR TENANT (AS APPLICABLE) OF ANY ONE OR MORE OF SUCH RIGHTS, POWERS AND
REMEDIES SHALL NOT PRECLUDE THE SIMULTANEOUS OR SUBSEQUENT EXERCISE BY LANDLORD
OF ANY OR ALL OF SUCH OTHER RIGHTS, POWERS AND REMEDIES.

 

23.4        SEVERABILITY.  ANY CLAUSE, SENTENCE, PARAGRAPH, SECTION OR PROVISION
OF THIS AGREEMENT HELD BY A COURT OF COMPETENT JURISDICTION TO BE INVALID,
ILLEGAL OR INEFFECTIVE SHALL NOT IMPAIR, INVALIDATE OR NULLIFY THE REMAINDER OF
THIS AGREEMENT, BUT RATHER THE EFFECT THEREOF SHALL BE CONFINED TO THE CLAUSE,
SENTENCE, PARAGRAPH, SECTION OR PROVISION SO HELD TO BE INVALID, ILLEGAL OR
INEFFECTIVE, AND THIS AGREEMENT SHALL BE CONSTRUED AS IF SUCH INVALID, ILLEGAL
OR INEFFECTIVE PROVISIONS HAD NEVER BEEN CONTAINED THEREIN.

 

23.5        ACCEPTANCE OF SURRENDER.  NO SURRENDER TO LANDLORD OF THIS AGREEMENT
OR OF THE LEASED PROPERTY OR ANY PART THEREOF, OR OF ANY INTEREST THEREIN, SHALL
BE VALID OR EFFECTIVE UNLESS AGREED TO AND ACCEPTED IN WRITING BY LANDLORD AND
NO ACT BY LANDLORD OR ANY REPRESENTATIVE OR AGENT OF LANDLORD, OTHER THAN SUCH A
WRITTEN ACCEPTANCE BY LANDLORD, SHALL CONSTITUTE AN ACCEPTANCE OF ANY SUCH
SURRENDER.

 

23.6        NO MERGER OF TITLE.  IT IS EXPRESSLY ACKNOWLEDGED AND AGREED THAT IT
IS THE INTENT OF THE PARTIES THAT THERE SHALL BE NO MERGER OF THIS AGREEMENT OR
OF THE LEASEHOLD ESTATE CREATED HEREBY BY REASON OF THE FACT THAT THE SAME
PERSON MAY ACQUIRE, OWN OR HOLD, DIRECTLY OR INDIRECTLY THIS AGREEMENT OR THE
LEASEHOLD ESTATE CREATED HEREBY AND THE FEE ESTATE OR GROUND LANDLORD’S INTEREST
IN THE LEASED PROPERTY.

 

23.7        CONVEYANCE BY LANDLORD.  IF LANDLORD OR ANY SUCCESSOR OWNER OF ALL
OR ANY PORTION OF THE LEASED PROPERTY SHALL CONVEY ALL OR ANY PORTION OF THE
LEASED PROPERTY IN ACCORDANCE WITH THE TERMS HEREOF OTHER THAN AS SECURITY FOR A
DEBT, AND THE GRANTEE OR TRANSFEREE OF SUCH OF THE LEASED PROPERTY SHALL
EXPRESSLY ASSUME ALL OBLIGATIONS OF LANDLORD HEREUNDER ARISING OR ACCRUING FROM
AND AFTER THE DATE OF SUCH CONVEYANCE OR TRANSFER, LANDLORD OR SUCH SUCCESSOR
OWNER, AS THE CASE MAY BE, SHALL THEREUPON BE RELEASED FROM ALL FUTURE
LIABILITIES AND OBLIGATIONS OF LANDLORD UNDER THIS AGREEMENT WITH RESPECT TO
SUCH OF THE LEASED PROPERTY ARISING OR ACCRUING FROM AND AFTER THE DATE OF SUCH
CONVEYANCE OR OTHER TRANSFER AND ALL SUCH FUTURE LIABILITIES AND OBLIGATIONS
SHALL THEREUPON BE BINDING UPON THE NEW OWNER.

 

23.8        QUIET ENJOYMENT.  TENANT SHALL PEACEABLY AND QUIETLY HAVE, HOLD AND
ENJOY THE LEASED PROPERTY FOR THE TERM, FREE OF HINDRANCE OR MOLESTATION BY
LANDLORD OR ANYONE CLAIMING BY,

 

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THROUGH OR UNDER LANDLORD, BUT SUBJECT TO (A) ANY ENCUMBRANCE PERMITTED UNDER
ARTICLE 20 OR OTHERWISE PERMITTED TO BE CREATED BY LANDLORD HEREUNDER, (B) ALL
PERMITTED ENCUMBRANCES, (C) LIENS AS TO OBLIGATIONS OF LANDLORD THAT ARE EITHER
NOT YET DUE OR WHICH ARE BEING CONTESTED IN GOOD FAITH AND BY PROPER
PROCEEDINGS, PROVIDED THE SAME DO NOT MATERIALLY INTERFERE WITH TENANT’S ABILITY
TO OPERATE ANY FACILITY AND (D) LIENS THAT HAVE BEEN CONSENTED TO IN WRITING BY
TENANT.  EXCEPT AS OTHERWISE PROVIDED IN THIS AGREEMENT, NO FAILURE BY LANDLORD
TO COMPLY WITH THE FOREGOING COVENANT SHALL GIVE TENANT ANY RIGHT TO CANCEL OR
TERMINATE THIS AGREEMENT OR ABATE, REDUCE OR MAKE A DEDUCTION FROM OR OFFSET
AGAINST THE RENT OR ANY OTHER SUM PAYABLE UNDER THIS AGREEMENT, OR TO FAIL TO
PERFORM ANY OTHER OBLIGATION OF TENANT HEREUNDER.

 

23.9        NO RECORDATION.  NEITHER LANDLORD NOR TENANT SHALL RECORD THIS
AGREEMENT.

 

23.10      NOTICES.

 

(A)           ANY AND ALL NOTICES, DEMANDS, CONSENTS, APPROVALS, OFFERS,
ELECTIONS AND OTHER COMMUNICATIONS REQUIRED OR PERMITTED UNDER THIS AGREEMENT
SHALL BE DEEMED ADEQUATELY GIVEN IF IN WRITING AND THE SAME SHALL BE DELIVERED
EITHER IN HAND, BY TELECOPIER WITH WRITTEN ACKNOWLEDGMENT OF RECEIPT, OR BY MAIL
OR FEDERAL EXPRESS OR SIMILAR EXPEDITED COMMERCIAL CARRIER, ADDRESSED TO THE
RECIPIENT OF THE NOTICE, POSTPAID AND REGISTERED OR CERTIFIED WITH RETURN
RECEIPT REQUESTED (IF BY MAIL), OR WITH ALL FREIGHT CHARGES PREPAID (IF BY
FEDERAL EXPRESS OR SIMILAR CARRIER).

 

(B)           ALL NOTICES REQUIRED OR PERMITTED TO BE SENT HEREUNDER SHALL BE
DEEMED TO HAVE BEEN GIVEN FOR ALL PURPOSES OF THIS AGREEMENT UPON THE DATE OF
ACKNOWLEDGED RECEIPT, IN THE CASE OF A NOTICE BY TELECOPIER, AND, IN ALL OTHER
CASES, UPON THE DATE OF RECEIPT OR REFUSAL, EXCEPT THAT WHENEVER UNDER THIS
AGREEMENT A NOTICE IS EITHER RECEIVED ON A DAY WHICH IS NOT A BUSINESS DAY OR IS
REQUIRED TO BE DELIVERED ON OR BEFORE A SPECIFIC DAY WHICH IS NOT A BUSINESS
DAY, THE DAY OF RECEIPT OR REQUIRED DELIVERY SHALL AUTOMATICALLY BE EXTENDED TO
THE NEXT BUSINESS DAY.

 

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(C)           ALL SUCH NOTICES SHALL BE ADDRESSED,

 

if to Landlord:

 

c/o Senior Housing Properties Trust

400 Centre Street

Newton, Massachusetts  02458

Attn:  Mr. David J. Hegarty

[Telecopier No. (617) 796-8349]

 

if to Tenant to:

 

c/o Five Star Quality Care, Inc.

400 Centre Street

Newton, Massachusetts  02458

Attn:  Mr. Bruce J. Mackey Jr.

[Telecopier No. (617) 796-8385]

 

(D)           BY NOTICE GIVEN AS HEREIN PROVIDED, THE PARTIES HERETO AND THEIR
RESPECTIVE SUCCESSORS AND ASSIGNS SHALL HAVE THE RIGHT FROM TIME TO TIME AND AT
ANY TIME DURING THE TERM OF THIS AGREEMENT TO CHANGE THEIR RESPECTIVE ADDRESSES
EFFECTIVE UPON RECEIPT BY THE OTHER PARTIES OF SUCH NOTICE AND EACH SHALL HAVE
THE RIGHT TO SPECIFY AS ITS ADDRESS ANY OTHER ADDRESS WITHIN THE UNITED STATES
OF AMERICA.

 

23.11      CONSTRUCTION.  ANYTHING CONTAINED IN THIS AGREEMENT TO THE CONTRARY
NOTWITHSTANDING, ALL CLAIMS AGAINST, AND LIABILITIES OF, TENANT OR LANDLORD
ARISING PRIOR TO ANY DATE OF TERMINATION OR EXPIRATION OF THIS AGREEMENT WITH
RESPECT TO THE LEASED PROPERTY SHALL SURVIVE SUCH TERMINATION OR EXPIRATION.  IN
NO EVENT SHALL LANDLORD BE LIABLE FOR ANY CONSEQUENTIAL DAMAGES SUFFERED BY
TENANT AS THE RESULT OF A BREACH OF THIS AGREEMENT BY LANDLORD.  NEITHER THIS
AGREEMENT NOR ANY PROVISION HEREOF MAY BE CHANGED, WAIVED, DISCHARGED OR
TERMINATED EXCEPT BY AN INSTRUMENT IN WRITING SIGNED BY THE PARTY TO BE
CHARGED.  ALL THE TERMS AND PROVISIONS OF THIS AGREEMENT SHALL BE BINDING UPON
AND INURE TO THE BENEFIT OF THE PARTIES HERETO AND THEIR RESPECTIVE SUCCESSORS
AND ASSIGNS.  EACH TERM OR PROVISION OF THIS AGREEMENT TO BE PERFORMED BY TENANT
SHALL BE CONSTRUED AS AN INDEPENDENT COVENANT AND CONDITION.  TIME IS OF THE
ESSENCE WITH RESPECT TO THE PROVISIONS OF THIS AGREEMENT.  EXCEPT AS OTHERWISE
SET FORTH IN THIS AGREEMENT, ANY OBLIGATIONS OF TENANT (INCLUDING WITHOUT
LIMITATION, ANY MONETARY, REPAIR AND INDEMNIFICATION OBLIGATIONS) AND LANDLORD
SHALL SURVIVE THE EXPIRATION OR SOONER TERMINATION OF THIS AGREEMENT.

 

23.12      COUNTERPARTS; HEADINGS.  THIS AGREEMENT MAY BE EXECUTED IN TWO OR
MORE COUNTERPARTS, EACH OF WHICH SHALL

 

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CONSTITUTE AN ORIGINAL, BUT WHICH, WHEN TAKEN TOGETHER, SHALL CONSTITUTE BUT ONE
INSTRUMENT AND SHALL BECOME EFFECTIVE AS OF THE DATE HEREOF WHEN COPIES HEREOF,
WHICH, WHEN TAKEN TOGETHER, BEAR THE SIGNATURES OF EACH OF THE PARTIES HERETO
SHALL HAVE BEEN SIGNED.  HEADINGS IN THIS AGREEMENT ARE FOR PURPOSES OF
REFERENCE ONLY AND SHALL NOT LIMIT OR AFFECT THE MEANING OF THE PROVISIONS
HEREOF.

 

23.13      APPLICABLE LAW, ETC.  THIS AGREEMENT SHALL BE INTERPRETED, CONSTRUED,
APPLIED AND ENFORCED IN ACCORDANCE WITH THE LAWS OF THE COMMONWEALTH OF
MASSACHUSETTS APPLICABLE TO CONTRACTS BETWEEN RESIDENTS OF MASSACHUSETTS WHICH
ARE TO BE PERFORMED ENTIRELY WITHIN MASSACHUSETTS, REGARDLESS OF (A) WHERE THIS
AGREEMENT IS EXECUTED OR DELIVERED; OR (B) WHERE ANY PAYMENT OR OTHER
PERFORMANCE REQUIRED BY THIS AGREEMENT IS MADE OR REQUIRED TO BE MADE; OR
(C) WHERE ANY BREACH OF ANY PROVISION OF THIS AGREEMENT OCCURS, OR ANY CAUSE OF
ACTION OTHERWISE ACCRUES; OR (D) WHERE ANY ACTION OR OTHER PROCEEDING IS
INSTITUTED OR PENDING; OR (E) THE NATIONALITY, CITIZENSHIP, DOMICILE, PRINCIPAL
PLACE OF BUSINESS, OR JURISDICTION OF ORGANIZATION OR DOMESTICATION OF ANY
PARTY; OR (F) WHETHER THE LAWS OF THE FORUM JURISDICTION OTHERWISE WOULD APPLY
THE LAWS OF A JURISDICTION OTHER THAN MASSACHUSETTS; OR (G) ANY COMBINATION OF
THE FOREGOING.  NOTWITHSTANDING THE FOREGOING, THE LAWS OF THE STATE SHALL APPLY
TO THE PERFECTION AND PRIORITY OF LIENS UPON AND THE DISPOSITION OF ANY
PROPERTY.

 

23.14      RIGHT TO MAKE AGREEMENT.  EACH PARTY WARRANTS, WITH RESPECT TO
ITSELF, THAT NEITHER THE EXECUTION OF THIS AGREEMENT, NOR THE CONSUMMATION OF
ANY TRANSACTION CONTEMPLATED HEREBY, SHALL VIOLATE ANY PROVISION OF ANY LAW, OR
ANY JUDGMENT, WRIT, INJUNCTION, ORDER OR DECREE OF ANY COURT OR GOVERNMENTAL
AUTHORITY HAVING JURISDICTION OVER IT; NOR RESULT IN OR CONSTITUTE A BREACH OR
DEFAULT UNDER ANY INDENTURE, CONTRACT, OTHER COMMITMENT OR RESTRICTION TO WHICH
IT IS A PARTY OR BY WHICH IT IS BOUND; NOR REQUIRE ANY CONSENT, VOTE OR APPROVAL
WHICH HAS NOT BEEN GIVEN OR TAKEN, OR AT THE TIME OF THE TRANSACTION INVOLVED
SHALL NOT HAVE BEEN GIVEN OR TAKEN.  EACH PARTY COVENANTS THAT IT HAS AND WILL
CONTINUE TO HAVE THROUGHOUT THE TERM OF THIS AGREEMENT AND ANY EXTENSIONS
THEREOF, THE FULL RIGHT TO ENTER INTO THIS AGREEMENT AND PERFORM ITS OBLIGATIONS
HEREUNDER.

 

23.15      ATTORNEYS’ FEES.  IF ANY LAWSUIT OR ARBITRATION OR OTHER LEGAL
PROCEEDING ARISES IN CONNECTION WITH THE INTERPRETATION OR ENFORCEMENT OF THIS
AGREEMENT, THE PREVAILING PARTY THEREIN SHALL BE ENTITLED TO RECEIVE FROM THE
OTHER PARTY THE PREVAILING PARTY’S COSTS AND EXPENSES, INCLUDING REASONABLE
ATTORNEYS’ FEES INCURRED IN CONNECTION THEREWITH, IN PREPARATION

 

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THEREFOR AND ON APPEAL THEREFROM, WHICH AMOUNTS SHALL BE INCLUDED IN ANY
JUDGMENT THEREIN.

 

23.16      PROPERTY SPECIFIC REPRESENTATIONS AND WARRANTIES.  TENANT REPRESENTS
AND WARRANTS TO LANDLORD THAT, WITH RESPECT TO THE PROPERTY LOCATED IN OVERLAND
PARK, KANSAS, AS OF OCTOBER 25, 2002, AND, WITH RESPECT TO THE PROPERTY LOCATED
IN ELLICOTT CITY, MARYLAND, AS OF NOVEMBER 19, 2004:

 

(A)           ALL (IF ANY) LEASES, SUBLEASES, LICENSES, CONCESSIONS, AND SIMILAR
AGREEMENTS GRANTING AN INTEREST TO ANY OTHER PERSON OR ENTITY FOR THE USE AND
OCCUPANCY OF ANY PORTION OF SUCH PROPERTY, AND ALL (IF ANY) AGREEMENTS IN PLACE
WHEREBY RESIDENTS ARE IN OCCUPANCY AT SUCH PROPERTY, ARE LEGAL, VALID, BINDING,
ENFORCEABLE AND IN FULL FORCE AND EFFECT, AND TO THE BEST OF TENANT’S KNOWLEDGE,
NO PARTY IS IN BREACH OR DEFAULT, AND NO EVENT HAS OCCURRED WHICH WITH NOTICE OR
LAPSE OF TIME, OR BOTH, WOULD CONSTITUTE A BREACH OR DEFAULT, OR PERMIT
TERMINATION, MODIFICATION, OR ACCELERATION UNDER SUCH AGREEMENTS, AND NO PARTY
HAS REPUDIATED ANY PROVISION OF SUCH AGREEMENTS;

 

(B)           TENANT HAS NOT RECEIVED WRITTEN NOTICE OF ANY PENDING OR
THREATENED CONDEMNATION ACTIONS WITH RESPECT TO SUCH PROPERTY OR ANY PART
THEREOF;

 

(C)           THERE ARE NO ACTIONS, SUITS OR PROCEEDINGS PENDING AGAINST SUCH
PROPERTY IN ANY COURT OF LAW, OR IN EQUITY OR BEFORE ANY COURT, ADMINISTRATIVE
AGENCY, COMMISSION OR OTHER PUBLIC GOVERNMENTAL AUTHORITY;

 

(D)           TO TENANT’S KNOWLEDGE, EACH PROPERTY IS DULY LICENSED AND
CURRENTLY COMPLIES WITH LICENSING UNDER APPLICABLE STATE AND LOCAL LAWS TO
OPERATE SUCH PROPERTY IN THE MANNER THAT IT IS PRESENTLY BEING OPERATED, AND
TENANT HAS NOT RECEIVED ANY NOTICES OF VIOLATIONS OF ANY LAWS OR REGULATIONS,
OTHER THAN THOSE VIOLATIONS OF LAW, RULES, REGULATIONS, ORDINANCES, ORDERS OR
REQUIREMENTS NOTED IN OR ISSUED BY ANY FEDERAL, STATE, COUNTY, MUNICIPAL OR
OTHER DEPARTMENT OR GOVERNMENTAL AGENCY HAVING JURISDICTION AGAINST OR AFFECTING
EITHER PROPERTY WHENEVER NOTED OR ISSUED;

 

(E)           TO TENANT’S KNOWLEDGE, TENANT HAS NOT VIOLATED ANY REQUIREMENTS OF
LAW CURRENTLY APPLICABLE TO EITHER PROPERTY OR ANY PART THEREOF WITH RESPECT
TO:  (I) THE INSTALLATION, EXISTENCE OR REMOVAL OF OR EXPOSURE TO ASBESTOS OR
ASBESTOS-CONTAINING MATERIALS; (II) THE EXISTENCE, DISCHARGE OR REMOVAL OF OR
EXPOSURE TO HAZARDOUS

 

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MATERIALS; (III) AIR EMISSIONS, WATER DISCHARGES, NOISE EMISSIONS AND ANY OTHER
ENVIRONMENTAL, HEALTH OR SAFETY MATTER; AND (IV) EFFECTS ON THE ENVIRONMENT OF
SUCH PROPERTY OR ANY PART THEREOF OR OF ANY ACTIVITY HERETOFORE, NOW OR
HEREAFTER CONDUCTED ON SUCH PROPERTY (COLLECTIVELY, THE “RELEVANT ENVIRONMENTAL
LAWS”);

 

(F)            TENANT HAS NOT RECEIVED ANY NOTICE OF ANY CLAIM OR CITATION OF
NONCOMPLIANCE WITH RESPECT TO ANY VIOLATION OF RELEVANT ENVIRONMENTAL LAWS AND,
TO TENANT’S KNOWLEDGE, THERE ARE NO FACTS, CIRCUMSTANCES, CONDITIONS OR
OCCURRENCES ON EITHER PROPERTY THAT COULD REASONABLY BE EXPECTED TO RESULT IN
THE VIOLATION OF ANY SUCH RELEVANT ENVIRONMENTAL LAWS OR CAUSE SUCH PROPERTY TO
BE SUBJECT TO ANY RESTRICTIONS ON THE EXISTING OR CONTEMPLATED DEVELOPMENT, USE
OR TRANSFERABILITY THEREOF UNDER ANY RELEVANT ENVIRONMENTAL LAWS;

 

(G)           TO TENANT’S KNOWLEDGE, EACH PROPERTY AND THE USES THEREOF COMPLY
IN ALL MATERIAL RESPECTS WITH ALL APPLICABLE BUILDING AND ZONING ORDINANCES AND
CODES;

 

(H)           NO GOVERNMENTAL AUTHORITY HAVING JURISDICTION OVER EITHER PROPERTY
HAS ISSUED ANY CITATIONS WITH RESPECT TO ANY MATERIAL DEFICIENCIES OR OTHER
MATTERS THAT FAIL TO CONFORM TO APPLICABLE STATUTES, REGULATIONS OR ORDINANCES
THAT HAVE NOT BEEN CORRECTED AS OF OCTOBER 25, 2002 WITH RESPECT TO THE PROPERTY
LOCATED IN OVERLAND PARK, KANSAS OR NOVEMBER 19, 2004 WITH RESPECT TO THE
PROPERTY LOCATED IN ELLICOTT CITY, MARYLAND; TENANT HAS NOT RECEIVED WRITTEN OR
ORAL NOTICE FROM ANY AGENCY SUPERVISING OR HAVING AUTHORITY OVER EITHER PROPERTY
REQUIRING SUCH PROPERTY OR ANY SERVICE, STAFF, OR PRACTICE PROVIDED AT SUCH
PROPERTY TO BE MODIFIED, RESTRICTED OR CONDITIONED AS TO SERVICE OR ELIGIBILITY
OR BE REWORKED OR REDESIGNED OR ADDITIONAL FURNITURE, FIXTURES, EQUIPMENT OR
INVENTORY TO BE PROVIDED AT SUCH PROPERTY SO AS TO CONFORM OR COMPLY WITH ANY
EXISTING IN ANY APPLICABLE LAW, CODE OR STANDARD; AND

 

(I)            THERE HAS BEEN NO MATERIAL ADVERSE CHANGE WITH RESPECT TO THE
PHYSICAL CONDITION OF THE OVERLAND PARK PROPERTY OR THE OPERATIONS AT THE
OVERLAND PARK PROPERTY SINCE APRIL 1, 2002 AND THERE HAS BEEN NO MATERIAL
ADVERSE CHANGE WITH RESPECT TO THE PHYSICAL CONDITION OF THE ELLICOTT CITY
PROPERTY OR THE OPERATIONS AT THE ELLICOTT CITY PROPERTY SINCE NOVEMBER 2, 2002.

 

23.17      NONLIABILITY OF TRUSTEES.  THE DECLARATIONS OF TRUST ESTABLISHING
CERTAIN ENTITIES COMPRISING LANDLORD, COPIES OF

 

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WHICH, TOGETHER WITH ALL AMENDMENTS THERETO (COLLECTIVELY, THE “DECLARATIONS”),
ARE DULY FILED WITH THE DEPARTMENT OF ASSESSMENTS AND TAXATION OF THE STATE OF
MARYLAND, PROVIDE THAT THE NAMES OF SUCH ENTITIES REFER TO THE TRUSTEES UNDER
SUCH DECLARATIONS COLLECTIVELY AS TRUSTEES, BUT NOT INDIVIDUALLY OR PERSONALLY,
AND THAT NO TRUSTEE, OFFICER, SHAREHOLDER, EMPLOYEE OR AGENT OF SUCH ENTITIES
SHALL BE HELD TO ANY PERSONAL LIABILITY, JOINTLY OR SEVERALLY, FOR ANY
OBLIGATION OF, OR CLAIM AGAINST, SUCH ENTITIES.  ALL PERSONS DEALING WITH SUCH
ENTITIES, IN ANY WAY, SHALL LOOK ONLY TO THE ASSETS OF SUCH ENTITIES FOR THE
PAYMENT OF ANY SUM OR THE PERFORMANCE OF ANY OBLIGATION.

 

23.18      BEVERLY MANOR ALLOWANCE.  LANDLORD AND TENANT ACKNOWLEDGE AND AGREE
THAT LANDLORD HAS SATISFIED ALL OF ITS OBLIGATIONS WITH RESPECT TO THE
“ALLOWANCE” AS DESCRIBED IN SECTION 3.1.1(D) OF THE ORIGINAL LEASE REGARDING THE
FACILITY COMMONLY KNOWN AS BEVERLY MANOR AND LOCATED IN ST. JOSEPH, MISSOURI.

 

23.19      SAVANNAH SQUARE LEASE.  LANDLORD AND TENANT ACKNOWLEDGE AND AGREE
THAT THE “SAVANNAH SQUARE LEASED PROPERTY” (AS DEFINED IN THE ORIGINAL LEASE)
WAS RELEASED FROM THE FINANCING SECURED THEREBY AS OF APRIL 1, 2008, AND THAT
THE SAVANNAH SQUARE LEASED PROPERTY WAS AUTOMATICALLY ADDED TO AND DEMISED UNDER
THE ORIGINAL LEASE AS OF SUCH DATE.

 

23.20      ORIGINAL LEASE.  LANDLORD AND TENANT ACKNOWLEDGE AND AGREE THAT THIS
AGREEMENT AMENDS AND RESTATES THE ORIGINAL LEASE IN ITS ENTIRETY WITH RESPECT TO
THE LEASED PROPERTY AS OF THE DATE OF THIS AGREEMENT AND THAT THIS AGREEMENT
SHALL GOVERN THE RIGHTS AND OBLIGATIONS OF THE PARTIES WITH RESPECT TO THE
LEASED PROPERTY FROM AND AFTER THE DATE OF THIS AGREEMENT.  NOTWITHSTANDING THE
FOREGOING, THE ORIGINAL LEASE SHALL CONTINUE TO GOVERN THE RIGHTS AND
OBLIGATIONS OF THE PARTIES WITH RESPECT TO THE LEASED PROPERTY PRIOR TO THE DATE
OF THIS AGREEMENT.

 

[Remainder of page intentionally left blank.]

 

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IN WITNESS WHEREOF, the parties have executed this Agreement as a sealed
instrument as of the date above first written.

 

 

LANDLORD:

 

 

 

 

ELLICOTT CITY LAND I LLC, ELLICOTT
CITY LAND II LLC, SNH CHS
PROPERTIES TRUST, SPTIHS
PROPERTIES TRUST, SPTMNR
PROPERTIES TRUST, SNH/LTA
PROPERTIES TRUST, SNH/LTA
PROPERTIES GA LLC, and SAVANNAH
SQUARE, INC.

 

 

 

 

 

By:

  /s/ Richard A. Doyle

 

 

Richard A. Doyle

 

 

Treasurer and Chief Financial

 

 

Officer of each of the

 

 

foregoing entities

 

 

 

 

 

 

TENANT:

 

 

 

FIVE STAR QUALITY CARE TRUST

 

 

 

 

 

By:

  /s/ Travis K. Smith

 

 

Travis K. Smith

 

 

Vice President

 

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The following exhibits have been omitted and will be supplementally furnished to
the Securities and Exchange Commission upon request:

 

EXHIBITS A-1 through A-82 (Land)

 

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