Document:

Exhibit 10.2

THIRD AMENDMENT TO SECOND AMENDED AND RESTATED LEASE AGREEMENT

THIS THIRD AMENDMENT TO SECOND AMENDED AND RESTATED LEASE AGREEMENT (this “Amendment”) is made and entered into as of October 31, 2005 by and among each of the parties identified on the signature page hereof as 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, pursuant to the terms of that certain Second Amended and Restated Lease Agreement, dated as of November 19, 2004, as amended by that certain First Amendment of Lease dated as of May 17, 2005 and that certain Second Amendment to Second Amended and Restated Lease Agreement dated as of June 3, 2005 (as so amended, the “Consolidated Lease”), Landlord leases to Tenant, and Tenant leases from Landlord, the Leased Property (this and other capitalized terms used but not otherwise defined herein having the meanings given such terms in the Consolidated Lease), all as more particularly described in the Consolidated Lease; and

WHEREAS, SNH/LTA Properties Trust has acquired certain real property and related improvements located on land in Allegheny County and Beaver County, Pennsylvania, as more particularly described on Exhibits A-83 through A-88 attached hereto (collectively, the “Third Amendment Property”); and

WHEREAS, SNH/LTA Properties Trust, the other entities comprising Landlord and Tenant wish to amend the Consolidated Lease to include the Third Amendment Property;

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 as follows:

1.     Effective as of the date hereof, Exhibits A-83 through A-88 are hereby inserted into the Consolidated Lease as Exhibits A-83 through A-88.

2.     Effective as of the date hereof, the definition of “Additional Properties” set forth in Section 1.2 of the Consolidated Lease is hereby amended by deleting the existing definition and replacing it with the following definition:

 

 

 

 

 

“Additional Properties” shall mean, collectively, (i) the Properties described in Exhibits A-30 and A-68 through A-88 hereof, and (ii) the LTA GMAC Leased Property.

3.     The definition of “Existing Properties” set forth in Section 1.33 of the Consolidated Lease is hereby amended by deleting the existing definition and replacing it with the following definition:

“Existing Properties” shall mean the Properties described in Exhibits A-1 through A-29 and A-31 through A-67 hereof.

4.     Effective as of the date hereof, the definition of “Minimum Rent” set forth in Section 1.69 of the Consolidated Lease is hereby amended by deleting the existing definition and replacing it with the following definition:

“Minimum Rent” shall mean the sum of Thirty-One Million Nine Hundred One Thousand Six Hundred Fifty-Two Dollars ($31,901,652) per annum.

5.     Effective as of the date hereof, Section 2.1 of the Consolidated Lease is hereby amended by deleting subsection (a) in its entirety and replacing it with the following:

(a)  those certain tracts, pieces and parcels of land, as more particularly described in Exhibits A-1 through A-88, attached hereto and made a part hereof (the “Land”);

6.     Section 12.1(m) of the Consolidated Lease is hereby amended by deleting it in its entirety and inserting the words “[INTENTIONALLY DELETED]” in its place.

7.     Effective as of the date hereof, Tenant shall pay all Additional Rent and Additional Charges related to the Third Amendment Property (which constitute Additional Property) in accordance with the provisions of the Consolidated Lease.

8.     As amended hereby, the Consolidated Lease is hereby ratified and confirmed.

[Signature Page Follows.]

 

- 2 -

 

 

 

IN WITNESS WHEREOF, Landlord and Tenant have caused this Amendment to be duly executed, as a sealed instrument, as of the date first set forth above.

LANDLORD:

ELLICOTT CITY LAND I LLC, ELLICOTT CITY LAND II LLC, HRES2 PROPERTIES TRUST, SNH CHS PROPERTIES TRUST, SPTIHS PROPERTIES TRUST, SPT-MICHIGAN TRUST, SPTMNR PROPERTIES TRUST, SNH/LTA PROPERTIES TRUST and SNH/LTA PROPERTIES GA LLC

By: /s/ John R. Hoadley

John R. Hoadley

Treasurer of each of the foregoing entities

TENANT:

FIVE STAR QUALITY CARE TRUST

By: /s/ Bruce J. Mackey Jr.

Bruce J. Mackey Jr.

Treasurer, Chief Financial Officer and Assistant Secretary

 

 

 

[The following exhibits have been omitted and will be supplementally

furnished to the Securities and Exchange Commission upon request.]

	
            EXHIBIT A-83
 	
             
 	
            FRANCISCAN MANOR PROPERTY
 
	
            EXHIBIT A-84
 	
             
 	
            MOUNT VERNON OF ELIZABETH PROPERTY
 
	
            EXHIBIT A-85
 	
             
 	
            MOUNT VERNON OF SOUTH PARK PROPERTY
 
	
            EXHIBIT A-86
 	
             
 	
            OVERLOOK GREEN PROPERTY
 
	
            EXHIBIT A-87
 	
             
 	
            RIDGEPOINTE PROPERTY
 
	
            EXHIBIT A-88
 	
             
 	
            ROLLING HILLS MANOR PROPERTYEXHIBIT 10.3

CONFIRMATION OF GUARANTEES AND CONFIRMATION  

AND AMENDMENT OF OTHER INCIDENTAL DOCUMENTS

THIS CONFIRMATION OF GUARANTEES AND CONFIRMATION AND AMENDMENT OF OTHER INCIDENTAL DOCUMENTS (this “Confirmation”) is made as of October 31, 2005 by FIVE STAR QUALITY CARE, INC., a Maryland corporation (the “Guarantor”), FIVE STAR QUALITY CARE TRUST, a Maryland business trust (the “Tenant”), FSQ, INC., a Delaware corporation (the “Tenant Pledgor”), each of the parties identified on the signature page hereof as a subtenant pledgor (collectively, the
“Subtenant Pledgors”) and each of the parties identified on the signature page hereof as a subtenant (collectively, the “Subtenants”) for the benefit of each of the parties identified on the signature page hereof as a landlord (collectively, the “Landlords”).

W I T N E S S E T H :

WHEREAS, pursuant to the terms of that certain Second Amended and Restated Lease Agreement, dated as of November 19, 2004, as amended by that certain First Amendment of Lease dated as of May 17, 2005 and that certain Second Amendment to Second Amended and Restated Lease dated as of June 3, 2005 (as so amended, the “Consolidated Lease”), the Landlords lease to the Tenant, and the Tenant leases from the Landlords, certain property, all as more particularly described in the Consolidated Lease; and

WHEREAS, the payment and performance obligations of the Tenant with respect to the Consolidated Lease are guaranteed by those certain Guaranty Agreements described on Exhibit A attached hereto (collectively, the “Guarantees”); and

WHEREAS, the payment and performance obligations of the Tenant with respect to the Consolidated Lease are further secured by the other Incidental Documents (this and other capitalized terms used but not otherwise defined herein shall have the meanings ascribed to them in the Consolidated Lease); and

WHEREAS, pursuant to a Third Amendment to Second Amended and Restated Lease Agreement, dated as of the date hereof (the “Third Amendment”), the Consolidated Lease is being amended to add certain properties, as more particularly described in the Third Amendment;

WHEREAS, the Tenant intends to enter into a sublease (the “Sublease”) with Five Star Quality Care-GHV, LLC, a Maryland 

 

 

 

limited liability company (“FVE-GHV”) to sublease the properties being added to the Consolidated Lease pursuant to the Third Amendment to FVE-GHV;

WHEREAS, in connection with, and as a condition precedent to, the execution of the Third Amendment by the Landlords, the Landlords have required that the parties hereto confirm that the Guarantees and the other Incidental Documents remain in full force and effect and apply to the Consolidated Lease as amended by the Third Amendment; and

WHEREAS, in connection with the execution of the Third Amendment and the Sublease, the parties hereto wish to amend certain of the Incidental Documents, including (i) the Security Agreement, dated as of December 31, 2001, by and among certain of the Subtenants and certain of the Landlords, as amended and confirmed from time to time (the “Subtenant Security Agreement”); (ii) the Security Agreement, dated as of December 31, 2001, by and among the Tenant and certain of the Landlords, as amended and confirmed from time to time (the “Tenant Security Agreement”); and (iii) the Second Amended and Restated Pledge of Stock and Membership Interests Agreement, dated as of May 6, 2005, made by the Subtenant Pledgors for the benefit of the Landlords, as
amended and confirmed from time to time (the “Subtenant Pledge Agreement”), all subject to and upon the terms and conditions herein set forth;

NOW, THEREFORE, in consideration of the foregoing and for other good and valuable consideration, the mutual receipt and legal sufficiency of which are hereby acknowledged, the parties hereto hereby agree as follows:

1.     Joinder by FVE-GHV.  FVE-GHV hereby joins in the Subtenant Security Agreement as if it had originally executed and delivered the Subtenant Security Agreement as a “Subtenant” thereunder.  FVE-GHV hereby joins in the Subtenant Guaranty (as defined in Exhibit A hereof) as if it had originally executed and delivered the Subtenant Guaranty as a “Subtenant” thereunder.

2.     Amendment of Subtenant Security Agreement.  The Subtenant Security Agreement is hereby amended by: (i) inserting the following at the end of Exhibit A attached thereto:

31.    Sublease Agreement, dated October 31, 2005, by and between Five Star Quality Care Trust, a Maryland business trust, and Five Star Quality Care-GHV, LLC, a Maryland limited liability company.

 

 

 

 

 

(ii) inserting the following at the end of Schedule 1 attached thereto:

	
            Five Star Quality Care-GHV, LLC,

a Maryland limited liability company

No:_______________
 	
            400 Centre Street

Newton, MA  02458
 	
            None.
 

 

and (iii) inserting the following in the appropriate order on Schedule 2 attached thereto:

 

	
             
	
            PENNSYLVANIA:
 	
            FRANCISCAN MANOR

71 Darlington Road

Beaver Falls, PA  15010

 
 	
            Five Star Quality Care-GHV, LLC
 
	
             
 	
            MOUNT VERNON OF ELIZABETH

145 Broadlawn Drive

Elizabeth, PA  15037

 
 	
            Five Star Quality Care-GHV, LLC
 
	
             
 	
            MOUNT VERNON OF SOUTH PARK

1400 Riggs Road

South Park, PA  15129

 
 	
            Five Star Quality Care-GHV, LLC
 
	
             
 	
            OVERLOOK GREEN

5250 Meadowgreen Drive

Pittsburgh, PA  15236

 
 	
            Five Star Quality Care-GHV, LLC
 
	
             
 	
            RIDGEPOINTE

5301 Brownsville Road

Pittsburgh, PA  15236

 
 	
            Five Star Quality Care-GHV, LLC
 
	
             
 	
            ROLLING HILLS MANOR

600 Newport Drive

Baldwin, PA  15234
 	
            Five Star Quality Care-GHV, LLC
 
				

 

3.     Amendment of Tenant Security Agreement.  The Tenant Security Agreement is hereby amended by inserting the following in the appropriate order on Schedule 2 attached thereto:

PENNSYLVANIA:

FRANCISCAN MANOR

71 Darlington Road

Beaver Falls, PA  15010

 

 

 

 

 

MOUNT VERNON OF ELIZABETH

145 Broadlawn Drive

Elizabeth, PA  15037

 

MOUNT VERNON OF SOUTH PARK

1400 Riggs Road

South Park, PA  15129

OVERLOOK GREEN

5250 Meadowgreen Drive

Pittsburgh, PA  15236

RIDGEPOINTE

5301 Brownsville Road

Pittsburgh, PA  15236

ROLLING HILLS MANOR

600 Newport Drive

Baldwin, PA  15234

4.     Amendment of Subtenant Pledge Agreement.  The Subtenant Pledge Agreement is hereby amended by (i) inserting the following at the end of Exhibit A attached thereto:

35.    Sublease Agreement, dated October 31, 2005, by and between Five Star Quality Care Trust, a Maryland business trust, as sublandlord, and Five Star Quality Care-GHV, LLC, a Maryland limited liability company, as subtenant.

and (ii) inserting the following at the end of Exhibit B attached thereto:

	
             
 	
            33.
 	
            Five Star Quality Care-GHV, LLC.
 

5.     Confirmation of Guarantees.  Each of the parties to the Guarantees hereby confirms that all references in the Guarantees to the “Master Lease” or the “Lease” shall refer to the Consolidated Lease as amended by the Third Amendment and the Guarantees are hereby ratified and confirmed in all respects.

6.     Confirmation of Other Incidental Documents.  Each of the parties to the Incidental Documents (other than the Guarantees) hereby confirms that all references in such Incidental Documents to the “Master Lease”, the “Lease” or the “Second Amended Lease” shall refer to the Consolidated Lease as amended by the Third Amendment and that such Incidental Documents, as amended by this Confirmation, are hereby ratified and confirmed in all respects.

 

 

 

 

 

7.     No Impairment, Etc.  The obligations, covenants, agreements and duties of the guarantors under the Guarantees shall not be impaired in any manner by the execution and delivery of the Third Amendment, the Guarantees, the other Incidental Documents, or any amendments, changes or modifications thereof, and in no event shall any ratification or confirmation of such Guarantees or such other Incidental Documents, or the obligations, covenants, agreements and the duties of the guarantors thereunder or of the parties under the other Incidental Documents, including, without limitation, this Confirmation, be required in connection with any such amendment, change or modification.

 

[Signatures on following page.]

 

 

 

 

IN WITNESS WHEREOF, the parties hereto have caused this Confirmation to be duly executed, as a sealed instrument, as of the date first set forth above.

	
            GUARANTOR:
 
	
             
 
	
            FIVE STAR QUALITY CARE, INC.
 
	
             
 
	
            By:     /s/ Bruce J. Mackey Jr.
 
	
            Bruce J. Mackey Jr.
 
	
            Treasurer, Chief Financial

Officer and Assistant Secretary
 
	
             
 
	
             
 
	
            TENANT:
 
	
             
 
	
            FIVE STAR QUALITY CARE TRUST
 
	
             
 
	
            By:     /s/ Bruce J. Mackey Jr.
 
	
            Bruce J. Mackey Jr.
 
	
            Treasurer, Chief Financial

Officer and Assistant Secretary
 
	
             
 
	
             
 
	
            TENANT PLEDGOR:
 
	
             
 
	
            FSQ, INC.
 
	
             
 
	
            By:     /s/ Bruce J. Mackey Jr.
 
	
            Bruce J. Mackey Jr.
 
	
            Treasurer, Chief Financial Officer 

and Assistant Secretary
 

 

 

 

 

 

 

	
            SUBTENANT PLEDGORS:
 
	
             
 
	
            FSQ, INC., FIVE STAR QUALITY CARE 
 TRUST, FVEST. JOE, INC., FIVE STAR 
 QUALITY CARE-CA, INC., FIVE STAR 
 QUALITY CARE-CA II, INC., FIVE STAR 
 QUALITY CARE-CO, INC., THE HEARTLANDS 
 RETIREMENT COMMUNITY-ELLICOTT CITY I, 
 INC., FIVE STAR QUALITY CARE-GA, INC., 
 FIVE STAR QUALITY CARE-IA, INC., FIVE

 STAR QUALITY CARE-NE, INC., FIVE STAR 
 QUALITY CARE-WI, INC. and LIFETRUST 
 AMERICA, INC.
 
	
             
 
	
            By:     /s/ Bruce J. Mackey Jr.
 
	
            Bruce J. Mackey Jr.
 Treasurer, Chief Financial Officer 
 and Assistant Secretary of each of 
 the foregoing entities
 
	
             
 
	
             
 
	
            LIFETRUST PROPERTIES, L.L.C.
 
	
             
 
	
            By:     LifeTrust America Inc.,
 
	
            Its Sole Member
 
	
             
 
	
            By:     /s/ Bruce J. Mackey Jr.
 
	
            Bruce J. Mackey Jr.
 
	
            Treasurer, Chief Financial Officer 
 and Assistant Secretary
 

 

 

 

 

 

 

	
            SUBTENANTS:
 
	
             
 
	
            FIVE STAR QUALITY CARE-AZ, LLC, 
 FIVE STAR QUALITY CARE-CA, LLC, 
 FIVE STAR QUALITY CARE-CA II, LLC, 
 
	
            FIVE STAR QUALITY CARE-COLORADO, LLC,
 
	
            FIVE STAR QUALITY CARE-CT, LLC, 
 FIVE STAR QUALITY CARE-GA, LLC, 
 FIVE STAR QUALITY CARE-GHV, LLC, 
 FIVE STAR QUALITY CARE-IA, LLC, 
 FIVE STAR QUALITY CARE-KS, LLC, 
 FIVE STAR QUALITY CARE-MD, LLC,

 FIVE STAR QUALITY CARE-MO, LLC, 
 
FIVE STAR QUALITY CARE-NE, LLC, 
 FIVE STAR QUALITY CARE-NC, LLC 
 FIVE STAR QUALITY CARE-WI, LLC, 
 FIVE STAR QUALITY CARE-WY, LLC, 

FIVE STAR QUALITY CARE-VA, LLC, 
 
FIVE STAR QUALITY CARE-CA, INC., 
 
FIVE STAR QUALITY CARE-IA, INC.,
 
	
            FIVE STAR QUALITY CARE-NE, INC.,
 
	
            MORNINGSIDE OF GALLATIN, LLC, THE 
 HEARTLANDS RETIREMENT COMMUNITY - 
 ELLICOTT CITY I, INC. and
 
	
            MORNINGSIDE OF BELMONT, LLC
 
	
             
 
	
            By:     /s/ Bruce J. Mackey Jr.
 
	
            Bruce J. Mackey Jr.
 
	
            Treasurer, Chief Financial 
 Officer and Assistant Secretary 
 of each of the foregoing 
 entities
 

 

 

 

 

 

 

	
            MORNINGSIDE OF ANDERSON, L.P., 
 MORNINGSIDE OF ATHENS, LIMITED 
 PARTNERSHIP, MORNINGSIDE OF COLUMBUS, 
 L.P., MORNINGSIDE OF DALTON, LIMITED 
 PARTNERSHIP, MORNINGSIDE OF EVANS, 
 LIMITED PARTNERSHIP, MORNINGSIDE OF 
 GREENWOOD, L.P. and MORNINGSIDE OF 
 KENTUCKY, LIMITED PARTNERSHIP
 
	
             
 
	
            By:     LifeTrust America, Inc.,
 
	
            General Partner of each of the 
 foregoing entities
 
	
             
 
	
            By:     /s/ Bruce J. Mackey Jr.
 
	
            Bruce J. Mackey Jr.
 Treasurer, Chief Financial 
 Officer and Assistant Secretary
 
	
             
 
	
            MORNINGSIDE OF BELLGRADE, RICHMOND, 
 LLC, MORNINGSIDE OF CHARLOTTESVILLE, 
 LLC, MORNINGSIDE OF NEWPORT NEWS, LLC 
 and MORNINGSIDE OF SKIPWITH – RICHMOND,
 LLC
 
	
             
 
	
            By:     LifeTrust America, Inc.,
 
	
            Member of each of the foregoing 
 entities
 
	
             
 
	
            By:     /s/ Bruce J. Mackey Jr.
 
	
            Bruce J. Mackey Jr.
 Treasurer, Chief Financial 
 Officer and Assistant Secretary
 

 

 

 

 

 

 

	
            LANDLORD:  
 
	
            HRES2 PROPERTIES TRUST,
 
	
            SPTIHS PROPERTIES TRUST,
 
	
            SPT-MICHIGAN TRUST,
 
	
            SPTMNR PROPERTIES TRUST,
 
	
            SNH CHS PROPERTIES TRUST,
 
	
            ELLICOTT CITY LAND I, LLC, 
 
	
            ELLICOTT CITY LAND II, LLC, 
 
	
            SNH/LTA PROPERTIES TRUST and
 
	
            SNH/LTA PROPERTIES GA LLC
 
	
             
 
	
            By:     /s/ John R. Hoadley
 
	
            John R. Hoadley
 
	
            Treasurer of each of the 
 foregoing entities
 

 

 

 

 

 

 

EXHIBIT A

 

GUARANTEES

 

	
            1.
 	
            Guaranty Agreement, dated as of December 31, 2001, made by Guarantor in favor of HRES2 Properties Trust, SPTIHS Properties Trust, SPT-Michigan Trust and SPTMNR Properties Trust.
 

 

	
            2.
 	
            Guaranty Agreement, dated as of October 25, 2002, made by Guarantor in favor of SNH CHS Properties Trust.
 

 

	
            3.
 	
            Guaranty Agreement, dated as of October 25, 2002, made by certain of the Subtenants in favor of SNH CHS Properties Trust (the “Subtenant Guaranty”).
 

 

The Guarantees were confirmed pursuant to (i) that certain Confirmation of Guarantees and Security Documents, dated as of March 1, 2004, made by certain of the parties hereto; (ii) that certain Confirmation of Guarantees and Other Incidental Documents, dated as of June 23, 2004, made by certain of the parties hereto; (iii) that certain Confirmation of Guarantees and Other Incidental Documents, dated as of November 19, 2004, made by certain of the parties hereto; and (iv) that certain Confirmation of Guarantees and Confirmation and Amendment of Other Incidental Documents, dated as of June 3, 2005, made by certain of the parties hereto.

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