Exhibit 10.212

FORBEARANCE AGREEMENT

This FORBEARANCE AGREEMENT (“Agreement”) is entered into by and between
COVINGTON REALTY, LLC, an Ohio limited liability company (the “Landlord”) and
REGIONAL HEALTH PROPERTIES, INC., a Georgia corporation (the “Tenant”), This
Agreement is effective as of the last date shown below the signature of the
parties’ representatives (the “Effective Date”).

BACKGROUND

A.Landlord and Tenant are parties to a Lease Agreement dated August 26, 2002
(the “Original Lease”), as amended by a First Amendment to Lease Agreement dated
July 14, 2003, by a Second Amendment to Lease Agreement dated April 1, 2008, by
a Third Amendment to Lease Agreement dated May 1, 2011, and by a Fourth
Amendment to Lease Agreement, dated April 14, 2014, and further by an Agreement
Regarding Lease and Sublease entered into as of August 1, 2015, among Landlord,
Tenant and CC SNF LLC, wherein Landlord consented to Tenant’s sublease of the
Facility (as defined below) to CC SNF LLC, a Florida corporation (the
“Subtenant”) (as so amended, the “Lease”), pursuant to which Landlord leases to
Tenant (and Tenant subleased to Subtenant) the licensed and certified nursing
facility commonly known as Covington Care Center, 75 Mote Drive, Covington, Ohio
(the “Facility”). All capitalized terms used in this Agreement that are defined
in the Lease and not otherwise defined in this Amendment shall have the meanings
given in the Lease.

B.Tenant is the successor by merger to AdCare Health Systems, Inc., a Georgia
corporation, the original tenant to the Lease.

C.Tenant received from Landlord a notice of Lease Default dated March 30, 2018,
citing Tenant’s failure to pay Base Rent for the period commencing March 2018
(the “Base Rent Default”), which failure constitutes a default under Section
14.01 of the Original Lease (the “Default Notice”).

D.Pursuant to a letter agreement dated October 5, 2018, certain terms and
conditions were agreed upon, whereby Landlord will agree to forbear taking
further action as a result of Tenant’s default, provided the terms and
conditions of this Agreement are fulfilled by Tenant. As of the Effective Date,
the unpaid Base Rent is $338,776.22.

E.Due to certain operating and financial difficulties experienced by Tenant’s
Subtenant, the Tenant has requested, and the Landlord is agreeable, subject to
the terms set forth in this Agreement, to temporarily forbear from exercising
its Lease rights and remedies to allow Tenant to make replace the Subtenant with
a new subtenant, and to make temporarily reduced Base Rent payments.

F.On or about November 30, 2018, Tenant, as Sublessor and MIAMI COV SNF, INC.,
an Ohio corporation, as Sublessee (referred to herein as “New Sublessee”),
entered into a Sublease Agreement (the “New Sublease”), whereby New Sublessee
subleased the Facility on the terms and conditions stated in the New Sublease.

G.In consideration by Tenant of the execution of this Agreement, Landlord
consented to the New Sublease, and executed additional documents to facilitate
certain financing arrangements required by New Sublessee to enable it to perform
its obligations under the New Sublease.

 

 

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NOW, THEREFORE, in consideration of the mutual promises contained herein, and
for other good and valuable consideration, the receipt and legal sufficiency of
which are hereby acknowledged, and intending to be legally bound hereby, the
Tenant and Landlord agree to the above and as follows:

1.Background Statements. The above Background Statements are incorporated into
and made a substantive, contractual part of this Agreement.

2.Tenant Acknowledgment and Admission of Lease Default. To induce the Landlord
to enter into this Agreement, the Tenant acknowledges, agrees, warrants and
represents that: (a) Tenant timely received the Default Notice; (b) Tenant
admits its failure to fully pay the Base Rent ($338,776.22), Insurance Escrow
($21,838.32), Tax Escrow ($34,503.90) and Replacement Reserve Funding
($30,000.00) for a total amount of $470,118.44 for the months of March through
December 2018; (c) Tenant further acknowledges and agrees that a Rent payment
default exists and that Landlord has the right and is entitled to exercise all
of its applicable legal rights and remedies to enforce this Lease and collect
rent damages; (d) the Lease is valid and legally binding on Tenant and is
enforceable by Landlord; (e) Tenant waives any additional required notification
or opportunity to cure options given by the Landlord, other than as may be
specifically provided herein; (f) the Tenant has no defenses, set-offs or
counterclaims against the Landlord, and Tenant affirmatively and voluntarily
hereby waives any and all defenses, set-offs and counterclaims that may exist or
that it may have under the Lease or by law; and (g) no Lease default whatsoever
by the Landlord exists.

3.Consideration; Forbearance Period; Payment of New Base Rent. As consideration
for, and as a condition to, Landlord’s willingness to forbear from exercising
its Lease remedies, effective as of the Effective Date Tenant agrees that (a)
the Term of the Lease shall be extended until April 30, 2029 (the “Forbearance
Period”); and (b) Tenant shall pay Landlord on a monthly basis, due and payable
on the first day of each and every month as shown below, in immediately
available funds, the following sums of money as new Base Rent payments:

 

Period

New Base Rent

December 2018 – March 2019

$34,000/mo (net)

April 2019 – August 2020

$40,000/mo (net)

September 2020 – March 2021

$45,000/mo (net)

April 2021 – April 2022

$50,000/mo (net)

Thereafter

Base Rent increases as set forth in the Lease

 

a.Replacement Reserve. Tenant agrees to Landlord’s withdrawal of Sixty-Eight
Thousand and No/100 Dollars ($68,000) from the tenant-funded (non-HUD)
replacement reserve account to satisfy a portion of the unpaid Base Rent as of
the Effective Date.

b.Method of Payment. During the term of this Agreement the Tenant shall pay to
Landlord on a monthly basis the stated amount of Base Rents by electronic funds
transfer to the Landlord’s account at the banking institution shown below.

 

Bank Name:

Stock Yards Bank & Trust

ABA:

083000564

Beneficiary:

Covington Realty, LLC

Acct No:

1927329

 

 

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4.Additional Requirements. In addition to the requirements of Tenant set forth
in the Lease, which requirements are hereby reaffirmed and shall be continued by
Tenant without Default, Tenant agrees to the following covenants and
requirements for the remainder of the Term:

a.Rent shall be due on the first day of each month with late charges accruing
after the 10th of the month;

b.Monthly census and financial reports shall be due to Landlord no later than
the end of the following calendar month to which they relate;

c.Landlord will have industry-standard inspection rights for the Facility.
Landlord shall be permitted to have a designated representative tour the
premises and inspect records during normal business hours upon three (3) days’
notice to the Tenant and sublessee.

d.Tenant and New Sublessee must maintain the Facility during the Term with no
consecutive surveys resulting in an IJ or higher level citation and must
maintain diligent and consistent efforts to improve the Facility’s Medicare Five
State Rating.

5.Conditions Precedent. The Parties acknowledge that Landlord has satisfied all
conditions precedent required of Landlord to the execution and implementation of
the New Sublease, to wit, the execution of:

a.The New Sublease;

b.A Landlord and Sublessor Waiver; and,

c.An Attornment and Non-Disturbance Agreement and Estoppel Certificate.

6.Representations and Warranties. The Tenant hereby represents and warrants to
the Landlord that: (a) the representations, warranties and acknowledgements set
forth in this Agreement are a mutual, voluntary concession, on a temporary
basis, of the payment of Rent that Tenant is obligated to make per the terms of
the Lease and that the terms of both the Lease and this Agreement are true and
correct in all material respects as of the date hereof; (b) the Tenant has the
requisite power necessary to execute and deliver this Agreement; and (c) the
execution, delivery and performance of this Agreement have been duly authorized
by the applicable members of the Tenant, and when executed, this Agreement will
constitute the valid, binding and enforceable obligation of the Tenant. Landlord
represents and warrants to Tenant that: (a) it is the owner of the Leased
Premises and the holder of the Lease; and (b) it has the requisite authority to
enter into this Agreement and perform all of its obligations hereunder.

 

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7.Further Agreements and Representations. The Tenant hereby:

a.ratifies, confirms and acknowledges that the Lease, as amended hereby, and
notwithstanding anything stated in the New Sublease, is and continues to be
valid, binding and in full force and effect as of the Effective Date, and
enforceable in accordance with their terms;

b.covenants and agrees to perform all of its obligations under the Lease and
this Agreement;

c.acknowledges and agrees that as of the date hereof, the Tenant has no defense,
set-off, counterclaim or challenge against the payment of any sums owing to
Landlord or the enforcement of any of the terms of the Lease, as amended hereby,
or any other document or writing between the parties;

d.acknowledges and agrees that this Agreement does not constitute a novation nor
modification of the Lease;

e.ratifies, confirms and continues all rights and remedies granted to Landlord
in the Lease; and

f.ratifies and confirms all waivers made by such Tenant in or with respect to
the Lease.

8.Releases by the Tenant. The Tenant, on behalf of itself, its members and any
person or entity directly or indirectly claiming by or through it (collectively,
the “Releasors”), hereby unconditionally remises, releases and forever
discharges the Landlord, and each of their respective past and present direct
and indirect owners, shareholders, partners, members, officers, directors,
agents, parent corporations, subsidiaries, affiliates, trustees (including
without limitation under any deed of trust, mortgage and/or deed to secure
debt), administrators, servicers, contractors, attorneys, successors and assigns
and the heirs, executors, administrators, successors’ and assigns of any such
person or entity (collectively, the “Releasees”), of and from any and all manner
of actions, causes of action, suits, debts, dues, accounts, bonds, covenants,
contracts, agreements, promises, warranties, guaranties, representations, liens,
mechanics’ liens, judgments, claims, counterclaims, cross claims, defenses
and/or demands whatsoever, including claims for contribution and/or indemnity,
whether now known or unknown, past or present, asserted or unasserted,
contingent or liquidated, at law, by statute or in equity, or resulting from any
assignment, if any (collectively, the “Claims”), which any of the Releasors ever
had, now have, or may have against any of the Releasees, for or by reason of any
cause, matter or thing whatsoever, arising from the beginning of time to the
date hereof relating to or arising from the Lease or the landlord/tenant
relationship created thereby between any of the Releasees and such Tenant. The
Tenant warrants and represents that it has not assigned, pledged, hypothecated
and/or otherwise divested itself and/or encumbered all or any part of the Claims
being released hereby and that it hereby agrees to indemnify and hold harmless
any and all of Releasees against whom any Claim so assigned, pledged,
hypothecated, divested and/or encumbered is asserted. The Tenant hereby agrees
to protect, defend, indemnify and hold harmless each Releasee from and against
any and all loss, cost, damage, expense or liability (including attorneys’ fees
and costs) which such Releasee may sustain or incur by reason of (i) any claim,
defense or cause of action brought by the Tenant or any of its members, (ii) any
breach by the Tenant of its obligations under this Agreement, (iii) any
inaccuracy when made of any representation or warranty made by the Tenant in
this Agreement, or (iv) or any act or omission of any Releasee which occurred
prior to the date of this Agreement.

 

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9.Forbearance by Landlord. Without waiving any Default by Tenant or the
Landlord’s rights and remedies, and subject to the terms and conditions set
forth in this Agreement and the Lease, or any documents executed in connection
with this Agreement, for so long as Tenant and Tenant’s subtenant are not in
default under the Lease and the proposed sublease, as the case may be, Landlord
(including its subsidiaries, affiliates, successors and assigns) will forbear
from pursuing against Tenant any manner of action and actions, claims, charges,
demands, counterclaims, crossclaims, suits, debts, dues, sums of money,
accounts, reckonings, bonds, bills, contracts, rights of setoff and recoupment,
controversies, damages, judgments, expenses, executions, liens, claims of liens,
claims of costs, penalties, attorneys’ fees, or any other compensation, recovery
or relief on account of any liability, obligation, demand or cause of action of
whatever nature, whether in law, equity or otherwise (each, a “Default Claim”)
that arises out of Tenant’s non-payment of Rent or any other sums due to
Landlord prior to the date of this Agreement under the existing Lease
(collectively, the “Rent Due”). For so long as neither Tenant nor its subtenant
is not in default under the existing Lease, as amended, or the new sublease, on
the final day of the third, fourth and fifth years following the execution of
the new sublease, Landlord will release and forever quitclaim specified portions
of the Rent Due as follows: one-third (1/3) at the end of year 3 of the new
sublease, one-third (1/3) at the end of year 4 of the new sublease, and
one-third (1/3) at the end of year 5 of the new sublease (collectively, the
“Rent Due Burn Off”). To the extent that Landlord has notified Tenant that it or
its subtenant is in default under the terms of Lease or the new sublease, such
that said default would impact the efficacy of the forbearance or the Rent Due
Burn-off provided above, Tenant will have fifteen days from receipt of a
notification of default to cure any monetary default, and thirty (30) days to
initiate a cure of any non-monetary default and an additional thirty (30) days
to complete the cure of any such default, provided however, that if any such
default cannot reasonably be cured within thirty (30) days, the cure period
shall be extended for up to ninety (90) days, or otherwise as may be agreed to
by Landlord, whose agreement to extend the allowable cure period may not be
unreasonably withheld or delayed, provided Tenant continues to utilize its best
efforts to timely effectuate such cure. The Forbearance Period shall terminate
as of the expiration of the Term. Further at Landlord’s option in its sole and
absolute business discretion, this Agreement and the Forbearance Period can be
terminated upon the occurrence of any of the following:

a.The Tenant files a petition for bankruptcy under any chapter of the Federal
Bankruptcy Code or takes advantage of any other debtor relief law, or an
involuntary petition for bankruptcy under any chapter of the Federal Bankruptcy
Code is filed against the Tenant, or any other judicial action is taken with
respect to the Tenant by any creditor of Tenant that appoints a trustee,
receiver, sequestrator or other custodian for itself or a substantial part of
its property or makes any assignment for the benefit of creditors;

b.Landlord discovers that any representation or warranty made herein by the
Tenant was or is untrue, incorrect or misleading in any material respect;

c.The Tenant breaches or defaults in performance of any covenant or agreement
contained in this Agreement; or

d.Any creditor commences any enforcement action against the Tenant or any assets
of the Tenant including, without limitation, filing of a suit or foreclosure
action, filing of a notice of lis pendens or similar notice, exercise of a power
of sale or the filing of a lien; provided, however, if the amount claimed by the
opposing party is less than $10,000, or if any such action (other than a
foreclosure) is dismissed within sixty (60) days of filing, then it shall be
deemed immaterial and this Section 9(d) shall not apply to such action, so long
as Tenant takes commercially reasonable steps to contest the action.

Upon termination of the Forbearance Period, for any reason, Landlord may take
all steps it deems necessary or desirable to enforce its Lease rights as
permitted by law or equity.

 

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10.Miscellaneous.

a.This Agreement shall be governed by the laws of the State of Ohio.

b.Time is of the essence in this Agreement.

c.This Agreement may be executed in any number of counterparts with the same
effect as if all the signatures on such counterparts appeared on one document
and each such counterpart shall be deemed an original. Any signature on this
Agreement, delivered by any party by facsimile or PDF transmission shall be
deemed to be an original signature thereto.

d.To the extent of any inconsistency between the terms and conditions of this
Agreement and the terms and conditions of the Lease, the terms and conditions of
this Agreement shall prevail. All terms and conditions of the Lease not
inconsistent herewith shall remain in full force and effect.

e.This Agreement shall bind and inure to the benefit of the parties hereto and
their respective successors and assigns. The Tenant shall not assign its rights
or obligations under this Agreement.

f.This Agreement is the entire agreement between the parties relating to the
subject matter hereof, incorporates or rescinds all prior agreements and
understandings between the parties hereto relating to forbearance of Base Rent
payments due under the Lease, cannot be changed or terminated orally or by
course of conduct, and shall be deemed effective as of the date it is accepted
by the Landlord. Oral commitments to modify or change the terms of this
Agreement, extend credit or to forbear from enforcing repayment of a debt,
including promises to extend or renew such Base Rent payment default, are not
enforceable. To protect Tenant and Landlord from misunderstanding or
disappointment, all agreements reached concerning such matters are included in
this writing, which is a complete and exclusive statement of the agreement
between Tenant and Landlord.

g.Except as expressly set forth herein, neither the execution, delivery nor
performance of this Agreement, nor anything contained herein, shall be construed
as or shall operate as a course of conduct, course of dealing or a consent to or
waiver of any provision of, or any right, power or remedy of the Landlord under
the Lease.

h.No present or future advisor, trustee, director, officer, employee,
shareholder, person, partner, member or agent of Landlord shall have any
personal liability, directly or indirectly, under or in connection with this
Agreement or any agreement made or entered into under or pursuant to the
provisions of this Agreement, or any amendment or amendments to any of the
foregoing made at any time or times, heretofore or hereafter, and the Tenant,
its successors and assigns hereby waive any and all such personal liability.

i.Neither party has any obligation to re-negotiate or modify the Lease (or to
attempt to do so in good faith or otherwise) and any such negotiations which may
occur may be broken off by any party at any time in their respective sole and
absolute discretion without liability. Any future waiver, alteration, amendment
or modification of any of the provisions of the Lease or this Agreement shall
not be valid or enforceable unless separately agreed to in writing and signed by
all parties (in their respective sole and absolute discretion), it being
expressly agreed that neither the Lease, nor this Agreement can be modified
orally, by course of dealing or by implied agreement. Moreover, any delay by
Landlord in enforcing its rights after an event of default shall not be a
release or waiver of the event of default and shall not be relied upon by any
party as a release or waiver of the default.

 

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j.The headings of paragraphs in this Agreement are for convenience of reference
only and shall not in any way affect the interpretation or construction of this
Agreement.

k.In any legal action relating to this Agreement, Tenant agrees that it shall
pay to Landlord, as additional Rents or Rent damages if reduced to a judgment in
favor of Landlord, all costs and expenses incurred by Landlord for such action
(including reasonable out of pocket attorneys’ fees and disbursements).

l.Tenant understands and agrees that any discussions and all communications,
including documents prepared in connection therewith during the Forbearance
period regarding the Lease are and shall be confidential, and shall not be
disclosed to third parties, except to agents, lenders, investors,
representatives, lawyers, and accountants as such may be reasonably necessary in
order to pursue discussions during the Forbearance Period. Further, this
Agreement may not be introduced by Tenant in any other litigation or other
proceeding (including Tenant’s bankruptcy case) involving a claim against
Landlord the same being privileged in the same manner as a settlement offer in
litigation. Notwithstanding the foregoing, Landlord may disclose this Agreement
and any communications in any matter or proceeding as it deems necessary or
advisable in order to enforce or otherwise give effect to the terms and
conditions hereof.

m.The warranties and representations of the Tenant in this Agreement shall
survive the termination of this Agreement.

REMAINDER OF PAGE INTENTIONALLY LEFT BLANK

SIGNATURE OF PARTIES ON FOLLOWING PAGE.

 

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IN WITNESS WHEREOF, the undersigned have each executed this Agreement with an
effective date being the last date shown below their respective signature.

TENANT:

 

REGIONAL HEALTH PROPERTIES, INC., a Georgia corporation

 

By:

/s/ Brent Morrison

Name:

Brent Morrison

Title:

Interim CEO

Date:

1/11/2019

 

LANDLORD:

 

COVINGTON REALTY, LLC, an Ohio limited liability company

 

By:

/s/ Find O. Karter

Name:

Find O. Karter

Title:

Manager

Date:

1/11/2018

 

 

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