Document:

EXHIBIT 10.14.3

 

AMENDMENT
NO. 3

TO AMENDED AND RESTATED

LIMITED LIABILITY COMPANY AGREEMENT

OF HCPI/TENNESSEE, LLC AND NEW MEMBER JOINDER
AGREEMENT

 

THIS AMENDMENT NO. 3 TO
AMENDED AND RESTATED LIMITED LIABILITY COMPANY AGREEMENT OF HCPI/TENNESSEE, LLC
AND NEW MEMBER JOINDER AGREEMENT (this “Amendment”) is made effective as of the
19 day of October, 2005 (the “Effective Date”) by and among HEALTH CARE
PROPERTY INVESTORS, INC., a Maryland corporation (the “Managing Member”),
HCPI/TENNESSEE, LLC, a Delaware limited liability company (the “Company”)
and A. Daniel Weyland, an individual (“New Member”).

 

RECITALS

 

A.            The
Managing Member and each of the persons whose names are set forth on Exhibit A thereto entered into the Amended and Restated
Limited Liability Company Agreement of HCPI/Tennessee, LLC effective as of October 2,
2003 (the “Original Agreement”), as amended by that certain Amendment No. 1
to Amended and Restated Limited Liability
Company Agreement of HCPI/Tennessee, LLC dated September 29, 2004
(the “First Amendment”), and that certain Amendment No. 2 to
Amended and Restated Limited Liability
Company Agreement of HCPI/Tennessee, LLC dated October 27, 2004
(the “Second Amendment, and together with the Original Agreement and the
First Amendment, the “Operating Agreement”), which provides that the
Managing Member is the Managing Member of Company.  Capitalized terms used in this Amendment and
not otherwise defined in this Amendment shall have the meanings given to such
terms in the Operating Agreement.

 

B.            Managing
Member, the Company, New Member and each entity identified as a “Contributing
Transferor” on the signature page thereto (each, a “Contributor”)
entered into that certain Contribution Agreement and Escrow Instructions dated
as of October     , 2005 (collectively, the “Denver
Contribution Agreement”), providing, among other things, for the
contribution by each Contributor of its respective right, title and interest to
the Company, and the acquisition by the Company of all right, title and
interest of each such Contributor (the “Contributed Denver Property
Interests”), in and to seven (7) medical office buildings in or around
Denver, Colorado, as more particularly described therein (the “Denver
Properties”).  The Company,
HCA-HealthOne LLC, a Colorado limited liability company (“HealthOne”),
and each entity identified as a “Seller” on the signature page thereto
(each, a “Seller”) have also entered into that certain Purchase
Agreement and Escrow Instructions dated of even date with the Denver Contribution
Agreement (the “Purchase Agreement”), providing, among other things, for
the purchase by the Company of all right, title and interest of each Seller, in
and to such Denver Properties (the “Purchased Denver Property Interests”).

 

C.            Pursuant
to the Contribution Agreement, New Member will receive Non-Managing Member
Units in the Company, and desires to be admitted to the Company as an
Additional Member and Non-Managing Member pursuant to the Operating Agreement,
as hereby amended.

 

 

D.            In
connection with the closing of the transactions contemplated by the
Contribution Agreement and Purchase Agreement, Managing Member desires to amend
the Operating Agreement, and the Company desires to admit New Member as an
Additional Member and Non-Managing Member to the Company, but only upon the
terms and conditions set forth herein.

 

E.             Pursuant
to that certain Written Consent of the Members the Company effective as of September 30,
2005 (the “Denver Consent”), Managing Member has received the requisite
consent of the current Non-Managing Members of the Company to the transactions
contemplated by the Contribution Agreement and the Purchase Agreement, this
Amendment and the admission of New Member as an Additional Member and
Non-Managing Member in the Company.

 

AGREEMENT

 

NOW, THEREFORE, the
Operating Agreement is hereby amended as of the Effective Date as follows:

 

1.             Admission of New Member.

 

(a)           The
Company hereby admits New Member as an Additional Member and Non-Managing
Member of the Company, and, in connection therewith, Exhibit A
to the Operating Agreement is hereby amended to reflect the information on Exhibit A attached hereto, including the Capital
Contributions of New Member for the number of Non-Managing Units reflected
thereon and the Capital Contribution by the Managing Member for the number of
Managing Member Units reflected thereon.

 

(b)           New
Member hereby agrees to be bound by the Operating Agreement, as hereby amended,
including, without limitation, Section 2.4 of the Original Agreement
[Power of Attorney], as a Non-Managing Member of the Company.

 

(c)           New
Member hereby represents and warrants to the Company, the Managing Member and
each other Member that the representations and warranties set forth in Section 3.4
of the Original Agreement are true and correct as of the Effective Date hereof.

 

2.             Amendments to Operating Agreement.

 

(a)           Definitions.  The
following definitions appearing in Article 1 of the Original Agreement are
hereby amended or supplemented as follows:

 

(i)            Adjustment Factor.  As
of the Effective Date, and after giving effect to the REIT Shares stock split
in the form of a stock dividend to the holders of REIT Shares with a record
date of February 4, 2004, and dividends issued to such holders on March 1,
2004, the Adjustment Factor is 2.0, subject to further adjustment pursuant to
the definition thereof.

 

(ii)           Contribution Agreement. 
With respect to the New Member, “Contribution Agreement”
shall mean the Denver Contribution Agreement.

 

2

 

(iii)          Contribution Indemnity. 
With respect to the New Member, “Contribution Indemnity”
shall have no application with respect to the Denver Contribution Agreement.

 

(iv)          Initial Value.  With
respect to the Contributed Denver Property Interests, the amount set forth with
respect to the “Contributed Denver Property Interests” as set forth on Exhibit B to this Amendment.

 

(v)           Preferred Return Per Unit. 
Notwithstanding anything to the contrary in the definition of “Preferred Return Per Unit” 
with respect to the New Member and each Non-Managing Member Unit issued
to New Member on the Effective Date, the increase in the Preferred Return Per
Unit with respect to each such Non-Managing Member Unit on the first LLC Record
Date following the Effective Date hereof shall be the product of (i) and (ii) of
such definition multiplied by a fraction, the numerator of which shall be the
number of days in the period commencing on the Effective Date hereof and ending
on the first LLC Record Date following the Effective Date hereof, and the
denominator of which shall be the number of days in the period commencing on August 9,
2005, and ending the first LLC Record Date following the Effective Date hereof.

 

(vi)          Real Properties.  “Real Properties” shall mean and include the Denver Properties
and, where appropriate, ownership interests in the Subsidiaries holding the
Denver Properties.

 

(vii)         Tax Protection Period. 
With respect to the New Member, “Tax Protection Period”
shall mean the period beginning on the Effective Date hereof and ending on the
earlier of (i) the tenth (10th) anniversary of the Effective
Date hereof or (ii) the Threshold Date with respect to the New Member.

 

(viii)        Threshold Date.  With
respect to the New Member, “Threshold Date”
means the date on which Eighty Percent (80%) of the LLC Units issued by the
Company to the New Member on the Effective Date hereof have been disposed of
pursuant to a Taxable Disposition or Series of Taxable Dispositions.  As used herein, “Taxable Disposition” means a transaction in which an LLC Unit has
either (a) been disposed of to the extent such disposition is a taxable
transaction (including, without limitation, a Redemption or exchange pursuant
to Section 8.6.A of the Operating Agreement) or (b) received a “step-up” in tax basis to its fair market
value at the time of such “step-up”
(e.g., as a result of the death of a holder of LLC Units who is an individual).

 

(ix)           Transferred Properties. 
With respect to the New Member, “Transferred Properties”
shall mean the Contributed Denver Property Interests pursuant to the applicable
Contribution Agreement.

 

(b)           Capital Contributions. 
The Members acknowledge that the Capital Contributions of the New Member
and the Managing Member pursuant to Section 4.2 of the Original Agreement
and upon consummation of the transactions contemplated by the Denver
Contribution Agreement and the Denver Purchase Agreement shall be as set forth
on Exhibit A hereto and the same
shall become part of Exhibit A
to the Operating Agreement.

 

3

 

(c)           Distributions and Allocations.

 

(i)            The
provisions of Section 12.2.C. of the Original Agreement shall apply with
respect to the New Member.

 

(ii)           Notwithstanding anything to the contrary in Section 6.3.B of the
Original Agreement, all excess non-recourse liabilities, as defined in
Regulations Section 1.752-3(a)(3), attributable to the Existing
Indebtedness (as defined below) shall be allocated as follows: (x) first to the
New Member in an amount equal to the built-in gain that is allocable to the New
Member on section 704(c) property (as defined in Regulations Section 1.704-3(a)(ii))
or property for which reverse section 704(c) allocations are
applicable (as described in Regulations Section 1.704-3(a)(6)(i)) where
such property is subject to the non-recourse liability to the extent that such
built-in gain exceeds the gain described in Regulations Section 1.752-3(a)(2) with
respect to such property; and (y) the balance, if any, in accordance with the
New Member profit sharing ratio.

 

(d)           Restrictions on Managing Member’s Authority.

 

(i)            At
all times during the Tax Protection Period applicable to the New Member, the
Company shall not prepay (i.e., make payments in addition to scheduled
interest and principal amortization), and shall not repay at maturity, the Debt
set forth on Schedule 2(d) attached hereto (the “Existing
Indebtedness”), unless all or a portion of the Existing Indebtedness is
replaced or refinanced with other Debt. or other Debt is incurred,  satisfying the requirements set forth below (“Replacement
Indebtedness”).  From and after or
concurrent with the date the Company incurs Replacement Indebtedness, this Section 2(d) shall
not restrict the Company’s ability to make payments with respect to the
Existing Indebtedness, including, without limitation, repayment of all or any
portion of the Existing Indebtedness at or prior to the stated maturity date
thereof.  Any Replacement Indebtedness
shall, during the Tax Protection Period:

 

(A)          be
comprised of one or more loans in a total principal amount of $9m (the “Guaranteed
Loan Amount”);

 

(B)           not
require principal repayments during such period that would cause the principal
balance of such Replacement Indebtedness to be less than the Guaranteed Loan
Amount at any time during the Tax Protection Period applicable to the New
Member or, alternatively, the Company shall finance any such shortfall with
Replacement Indebtedness;

 

(C)           be full
recourse to the Company;

 

(D)          be secured
by Real Properties or any Successor Properties with a Loan-to-Value Ratio of
not greater than Seventy Percent (70%) determined at the time such Replacement
Indebtedness is incurred;

 

(E)           not result
in the Equity Coverage of the Company being less than Twenty Million Dollars
($20,000,000.00) (the “Minimum

 

4

 

Equity”)
determined at the time such Replacement Indebtedness is incurred;

 

(F)           allow the
New Member to execute and deliver to the lender thereunder a Bottom Guarantee
(as defined below) and require that such lender accept such Bottom Guarantee;
and

 

(G)           be either (1) provided
by a lender that does not have an interest in the Company and is not related to
the Company in any manner (other than as a lender) within the meaning of Section 465(b)(3)(A) of
the Code, or (2) of a nature and source such that it would not disqualify
the guarantee of such indebtedness from preventing the recapture pursuant to Section 465(e) of
the Code of losses claimed by the New Member prior to the Effective Date (with
the Company permitted to assume for this purpose that a Bottom Guarantee is
effective to make the guarantor “at risk” for purposes of Section 465 of
the Code with respect to debt that otherwise satisfies the requirements of Section 465);
and

 

(H)          either (1) not
be subject to a guarantee, reimbursement or indemnity agreement provided by any
Person other than the Company or the New Member that is executing a Bottom
Guarantee pursuant to clause (ii) of this Section 2(d), and except
for a customary non-recourse carve-out guarantee, environmental indemnity or
similar guarantee or indemnity given by the Managing Member or its Affiliates,
or (2) not have any Person who might be considered to “bear the economic
risk of loss” or to be “at risk” with respect to such Replacement Indebtedness
unless such Person is the Managing Member or one of its Affiliates and the New
Member is permitted to enter into an indemnity agreement with such Person so as
to cause the New Member to “bear the economic risk of loss”  or to be “at risk” with respect to such Debt
vis-à-vis such Person, which indemnity shall be substantially in accordance
with the terms and provisions of the Bottom Guarantee pursuant to clause (ii) of
this Section 2(d).

 

The Managing Member shall
provide the New Member written notice of its desire to incur Replacement
Indebtedness, or to refinance or repay the Existing Indebtedness or any
permitted Replacement Indebtedness with Replacement Indebtedness, not less than
thirty (30) days prior to the incurrence by the Company of such Replacement
Indebtedness.  In connection with the incurrence
of any Replacement Indebtedness, the Managing Member shall also provide to the
New Member (1) financial or other information concerning any Existing
Indebtedness being refinanced and the terms of the Replacement Indebtedness to
be incurred, in each case as reasonably requested by the New Member, and (2) a
written statement that in the opinion of the Managing Member the requirements
of clause (i) this Section 2(d) are satisfied with respect to
the Replacement Indebtedness.

 

5

 

(ii)           During
the Tax Protection Period applicable to the New Member, the New Member shall
have the option from time to time to execute Bottom Guarantees for any
Replacement Indebtedness in any amount (in the aggregate) up to the Guaranteed
Loan Amount.  If the New Member elects to
execute Bottom Guarantees (in the aggregate) for less than the Guaranteed Loan
Amount, then upon written notice to the Company, the Managing Member and the
lender under any Replacement Indebtedness, not more frequently than one time
per year during the Tax Protection Period applicable to the New Member, the New
Member may elect to increase the New Member’s Bottom Guarantees (in the
aggregate) in any amount up to the Guaranteed Loan Amount.  As used herein, “Bottom Guarantee”
means an agreement in substantially the form attached hereto as Exhibit C or in such other form as may be reasonably
acceptable to the lender and the New Member and providing substantively the
same benefits to the New Member as the form attached hereto as Exhibit C.  The
New Member shall deliver to the Company a copy of any Bottom Guarantee
(including any amendment or modification thereof) promptly upon execution and
delivery of the same to the lender under any Replacement Indebtedness.

 

(iii)          If
the Company incurs Replacement Indebtedness pursuant to clause (i) of this
Section 2(d) and the New Member exercises its option to deliver one
or more Bottom Guarantees pursuant to clause (ii) of this Section 2(d) for
any amount up to the Guaranteed Loan Amount with respect to such Replacement
Indebtedness, then during the Tax Protection Period the Company shall not:

 

(A)          sell,
exchange or further encumber or otherwise dispose of any Real Properties or Successor
Properties securing the any such Replacement Indebtedness therefore (herein, a “Collateral
Change Transaction”), if immediately following such Collateral Change
Transaction the Loan-to-Value Ratio is greater than Seventy Percent (70%);
provided, however, that nothing contained herein shall prohibit the Company
upon the closing of any such Collateral Change Transaction from providing
additional collateral of the Company so that the Loan-to-Value Ratio as of the
date thereof is not greater than Seventy Percent (70%); or

 

(B)           engage
in any sale, financing, exchange or similar transaction involving any of the
Properties (herein, a “Capital Transaction”) if immediately following
such Capital Transaction the Equity Coverage is less than the Minimum Equity.

 

The Managing Member shall
give the New Member written notice of any proposed Collateral Change
Transaction and/or any proposed Capital Transaction not less than forty-five
(45) days prior to the closing thereof, together with such financial or other
information concerning such transaction as the New Member shall reasonably
request, and a written statement that in the opinion of the Managing Member (1) in
connection with any Collateral Change Transaction, the Loan-to-Value Ratio
immediately following such Collateral Change Transaction shall not be greater
than Seventy Percent (70%), and (2) in connection with any Capital
Transaction, the Company’s Equity Coverage immediately following such Capital
Transaction shall not be less

 

6

 

than the Minimum
Equity.  If the New Member reasonably
disagrees with the Managing Member’s opinion of such Equity Coverage, the New
Member shall notify the Company and the Managing Member thereof within ten (10) days
after the New Member’s receipt of such notice and opinion, and for a period of
ten (10) days thereafter the parties shall in good faith attempt to agree
upon the same.  If the parties are unable
to so agree, then either the New Member or the Managing Member may at anytime
thereafter submit the matter to binding appraisal as provided in clause (iv) of
this Section 2(d).

 

If (x)
the Managing Member notifies the New Member that the Loan-to-Value immediately
following any Collateral Change Transaction shall be greater than Seventy
Percent (70%), or (y) the Managing Member notifies the New Member that the
Equity Coverage immediately following a Capital Transaction shall be less than
the Minimum Equity or the same is determined by the agreement of the parties or
pursuant to the appraisal procedures specified in clause (iv) of this Section 2(d),
then in the event of either (x) or (y), New Member may at anytime thereafter
give the Company and the Managing Member sixty (60) days written notice of its
intent to cancel and terminate its Bottom Guarantee.  If the Company fails within such sixty (60)
day period to (aa) in the case of a Collateral Change Transaction, reduce the
Loan-to-Value Ratio to Seventy Percent (70%) or less or (bb) in the case of a
Capital Transaction, achieve an Equity Coverage not less than the Minimum
Equity, then the New Member shall be entitled to cancel and terminate the
Bottom Guarantee by a second written notice to the Managing Member and the
Company at anytime after such sixty (60) day period and prior to the Company’s
satisfaction of the requirements in either subclause (aa) or subclause (bb), as
applicable.   If the New Member is
entitled to and so cancels and terminates such Bottom Guarantee pursuant to the
provisions of this clause (iii), the effective date of cancellation and
termination thereof shall be referred to herein, as a “Company Caused Bottom
Guarantee Termination.”

 

(iv)          If
it becomes necessary to determine the Equity Coverage by binding appraisal as a
result of a Capital Transaction as provided in clause (iii) of this Section 2(d),
the same shall be determined by an independent appraisal firm, in which one or
more of the members, officers or principals of such firm are Members of the
Appraisal Institute (or any successor organization thereto), as may be
reasonably selected by the Managing Member (the “Appraiser”).  In such event, the Managing Member shall
cause such Appraiser to determine the Equity Coverage as of the relevant date
and the determination of such Appraiser shall be final and binding upon the
parties.  A written report of such
Appraiser shall be delivered and addressed to each of the Company, the Managing
Member and the New Member.  This
provision for determination by appraisal shall be specifically enforceable to
the extent such remedy is available under applicable law, and any determination
hereunder shall be final and binding upon the parties.  The Managing Member and the New Member shall
each pay one-half of the fees and expenses of the Appraiser and one-half of all
other costs and expenses incurred in connection with such appraisal.

 

(v)           Notwithstanding
anything to the contrary in the Operating Agreement, as hereby amended, in
addition to the provisions of Sections 7.3.E. and 7.3.F. of the Original
Agreement, each of the following shall be deemed for all purposes of the
Operating Agreement as a “Triggering Event”
with respect to the New Member (but not with respect to any other Non-Managing
Member) and entitle the New Member to receive a “Make Whole

 

7

 

Payment”
pursuant and subject to the provisions of Sections 7.3.G. and 7.3.H. of the
Original Agreement, unless the New Member consents to the following in writing,
which consent shall expressly state that the right to the Make Whole Payment is
being waived:

 

(A)          the
failure of the Company at anytime during the Tax Protection Period applicable
to the New Member to keep in place the Existing Indebtedness or any permitted
Replacement Indebtedness therefore;

 

(B)           a
Company Caused Bottom Guarantee Termination; provided, however, that any other
cancellation or termination of a Bottom Guarantee by the New Member, the
failure of any Bottom Guarantee to achieve the New Member’s objectives, and/or
the failure of the New Member to avail itself of the opportunity to execute and
deliver a Bottom Guarantee as provided herein shall not be deemed a “Triggering
Event” with respect to the New Member;

 

(C)           prior
to the payment in full of any Existing Indebtedness, any change in the
allocation of excess non-recourse liabilities, with respect to such Existing
Indebtedness, from the allocation provided in clause (ii) of Section 2(c) hereof;
or

 

(D)          the
failure of the Company at any time during the Tax Protection Period to hold the
ownership interests in the Denver Properties (or any Successor Properties)
either directly or through Subsidiaries whose separate existence from the
Company is disregarded for federal income tax purposes.

 

(vi)          As
used in this Amendment, “Loan-to-Value Ratio”
shall mean the ratio, as of the date of any incurrence of Replacement
Indebtedness (or any refinance of Replacement Indebtedness with other
Replacement Indebtedness) or any Collateral Change Transaction in accordance
with the provisions of this Section 2(d), in which the numerator is equal
to the outstanding principal balance of all Debt, including any Replacement
Indebtedness, secured by the Real Properties (or any Successor Properties)
serving as collateral for the Replacement Indebtedness and the denominator is
equal to the fair market value of such Real Properties (or any Successor
Properties), as reasonably and in good faith determined by the Managing Member.

 

(e)           Redemption Rights. 
With respect to the New Member and the Non-Managing Member Units issued
to the New Member on the Effective Date hereof, the Redemption Right provided
for in Section 8.6 of the Original Agreement shall not be exercisable
until the first anniversary of the Effective Date hereof and the phrase “ending
on the ninth anniversary of the Effective Date” as provided therein shall have
no application with respect to the New Member or its Non-Managing Member Units.

 

8

 

3.             The provisions of
this Amendment relating to the New Member (including, without limitation, Sections
2(c) and (d) hereof) shall not be amended or modified without the
written consent of the New Member.

 

4.             Except as expressly
amended hereby, the Operating Agreement remains in full force and effect in
accordance with its terms.

 

9

 

IN WITNESS WHEREOF, the
undersigned has executed this Amendment as of the date first written above.

 

 

	
  MANAGING MEMBER:

  	
  HEALTH CARE
  PROPERTY INVESTORS, INC., 

  a Maryland corporation 

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
  /s/ Talya
  Nevo-Hacohen

  	
   

  
	
   

  	
  Name:

  	
   

  	
  Talya
  Nevo-Hacohen

  	
   

  
	
   

  	
  Title:

  	
   

  	
  Senior Vive
  President

  	
   

  
							

 

10

 

	
  NEW MEMBER:

  	
  /s/ A. Daniel
  Weyland

  	
   

  
	
   

  	
  A. Daniel Weyland

  

 

11

 

EXHIBIT A

 

NEW CAPITAL CONTRIBUTIONS

 

Non-Managing Members

 

	
  Non-Managing Member

  Name and Address

  	
   

  	
  New Capital Contribution

  	
   

  	
  Number of Non-Managing

  Member Units

  	
   

  
	
  A. Daniel Weyland

  601 East Hampden Avenue

  Suite 590

  Englewood, Colorado 80113

  	
   

  	
  $

  	
  10,983,403.62

  	
   

  	
  214,872.13

  	
   

  
							

 

Managing Member

 

	
  Managing Member

  Name and Address

  	
   

  	
  Capital Contribution

  	
   

  	
  Gross Asset Value of

  Capital Contribution

  	
   

  	
  Number of

  Managing

  Member Units

  	
   

  
	
  Health Care Property Investors, Inc.

  3760 Kilroy Airport Way

  Suite 300

  Long Beach, California 90806

  Attention: Edward J. Henning, Esq.

  Telephone No.: (562) 733-5100

  Facsimile No.: (562) 733-5200

  	
   

  	
  New Cash Contribution

  	
   

  	
  $

  	
  15,297,220.28

  	
   

  	
  299,264.81

  	
   

  
									

 

 

EXHIBIT B

 

INITIAL VALUES OF CONTRIBUTED

DENVER PROPERTY INTERESTS

 

 

	
  Real Property

  	
   

  	
  Initial Value

  	
   

  	
  Type of Transfer

  
	
  601 East Hampden
  Avenue

  Englewood, Colorado

  	
   

  	
  $

  	
  1,325,722.03

  	
   

  	
  Equity – 50%
  undivided

  tenant-in-common interest

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  701 East Hampden
  Avenue

  Englewood, Colorado

  	
   

  	
  $

  	
  1,821,625.27

  	
   

  	
  Equity – 50%
  undivided

  tenant-in-common interest

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  799 East Hampden
  Avenue

  Englewood, Colorado

  	
   

  	
  $

  	
  1,845,772.27

  	
   

  	
  Equity – 50%
  undivided

  tenant-in-common interest

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  499 East Hampden
  Avenue

  Englewood, Colorado

  	
   

  	
  $

  	
  1,891,789.61

  	
   

  	
  Equity – 50%
  undivided

  tenant-in-common interest

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  6169 South
  Balsam Way

  Littleton, Colorado

  	
   

  	
  $

  	
  1,257,419.80

  	
   

  	
  Equity – 53.25%
  undivided

  tenant-in-common interest

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  6179 South
  Balsam Way

  Littleton, Colorado

  	
   

  	
  $

  	
  2,725,082.32

  	
   

  	
  Equity – Fee
  Title

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  26659 Pleasant
  Park Road

  Conifer, Colorado

  	
   

  	
  $

  	
  115,992.32

  	
   

  	
  Equity – 50%
  undivided

  tenant-in-common interest

  

 

 

EXHIBIT C

 

FORM OF BOTTOM DOLLAR GUARANTEE

 

 

Schedule 2(d)

 

EXISTING INDEBTEDNESS

 

	
  Property

  	
   

  	
  Existing Indebtedness

  
	
  601 East Hampden
  Avenue

  Englewood, Colorado

  	
   

  	
  Loan made by
  Heller Financial, Inc. in the original principal sum of $6,640,000.00,
  which loan is secured by a lien on the Property.

  
	
   

  	
   

  	
   

  
	
  799 East Hampden
  Avenue

  Englewood, Colorado

  	
   

  	
  Loan made by
  Allstate Life Insurance Company in the original principal sum of
  $6,350,000.00, which loan is secured by a lien on the Property.

  
	
   

  	
   

  	
   

  
	
  499 East Hampden
  Avenue

  Englewood, Colorado

  	
   

  	
  Loan made by
  Allstate Life Insurance Company in the original principal sum of
  $6,000,000.00, which loan is secured by a lien on the Property.

  
	
   

  	
   

  	
   

  
	
  6169 South
  Balsam Way

  Littleton, Colorado

  	
   

  	
  Loan made by
  Ameriprise Certificate Company in the original principal sum of
  $3,300,000.00, which loan is secured by a lien on the Property.

  
	
   

  	
   

  	
   

  
	
  6179 South
  Balsam Way

  Littleton, Colorado

  	
   

  	
  Loan made by
  Ameriprise Certificate Company in the original principal sum of
  $3,700,000.00, which loan is secured by a lien on the Property.

  
	
   

  	
   

  	
   

  
	
  26659 Pleasant
  Park Road

  Conifer, Colorado

  	
   

  	
  Loan made by
  Ameriprise Certificate Company in the original principal sum of
  $1,050,000.00, which loan is secured by a lien on the Property.EXHIBIT 10.29

 

RESTRICTED
STOCK UNIT AGREEMENT

 

James F. Flaherty III, Grantee:

 

As of the 26th day of October 2005 (the “Grant
Date”), Health Care Property Investors, Inc., a Maryland corporation
(the “Company”), pursuant to the Health Care Property Investors, Inc.
2000 Stock Incentive Plan, as amended and/or restated from time to time (the “Plan”),
has granted to you, the Grantee named above, 58,500 restricted stock units (the
“Units”) with respect to 58,500shares of Common Stock on the terms and
conditions set forth in this Restricted Stock Unit Agreement (this “Agreement”)
and the Plan.  The Units are subject to
adjustment as provided in Section 11(a) of the Plan.  Capitalized terms not defined herein shall
have the meanings assigned to such terms in the Plan.  The Compensation Committee (the “Committee”)
of the Board of Directors of the Company (the “Board”) is the
administrator of the Plan for purposes of your Units.

 

I.              Vesting.

 

(a)           Vesting of Units.  Subject to the terms and conditions of this
Agreement, your Units shall vest in accordance with the following schedule,
subject to your continuous service to the Company until the applicable vesting
date.  (Vesting amounts pursuant to the
following schedule are cumulative.)

 

	
  Tranche

  	
   

  	
  Percentage of

  Units that Vest

  	
   

  	
  Vesting Date

  
	
  1

  	
   

  	
  20%

  	
   

  	
  13 Months After the
  Grant Date

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  2

  	
   

  	
  20%

  	
   

  	
  2nd Anniversary of
  Grant Date

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  3

  	
   

  	
  20%

  	
   

  	
  3rd Anniversary of
  Grant Date

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  4

  	
   

  	
  20%

  	
   

  	
  4th Anniversary of
  Grant Date

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  5

  	
   

  	
  20%

  	
   

  	
  5th Anniversary of
  Grant Date

  

 

The vesting schedule requires
continued employment through each applicable Vesting Date as a condition to
vesting of the applicable Tranche and the corresponding rights and benefits
under this Agreement.  Unless otherwise
expressly provided herein with respect to accelerated vesting of the Units
under certain circumstances, employment for only a portion of a vesting period,
even if a substantial portion, will not entitle you to any proportionate
vesting or avoid or mitigate a termination of rights and benefits upon or
following a termination of employment as provided in this Agreement.

 

1

 

(b)           Acceleration on
Certain Terminations.  If at any time
prior to the date your Units become fully vested in accordance with Section 1(a),
your employment with the Company is terminated as a result of (i) your
death or Disability), (ii) a Termination Other Than For Cause (iii) a
Termination For Good Reason, or (iv) a Termination Upon a Change in
Control (including a Covered Resignation), your Units (to the extent then
outstanding and otherwise unvested) shall fully vest immediately upon such
termination of employment.  For purposes
of this Agreement, the terms “Covered Resignation,” “Disability,”
“Termination Other Than For Cause,” “Termination For Good Reason,”
and “Termination Upon a Change in Control” shall have the meanings
ascribed to such terms in your Employment Agreement with the Company dated October 26,
2005 (the “Employment Agreement”). 
Such meanings shall continue to apply for purposes of this Agreement notwithstanding
any termination of the “Employment Period” (as such term is defined in
the Employment Agreement) in accordance with the Employment Agreement.

 

(c)           No Acceleration
or Vesting Upon Other Terminations.  Except
as otherwise provided in the Plan, if at any time your employment with the
Company is terminated (i) by the Company, or (ii) by you, under any
circumstances (other than as a result of your death or Disability, a Termination
Other Than For Cause, a Termination For Good Reason, or a Termination Upon a
Change in Control, including a Covered Resignation), any of your Units that
remain outstanding and otherwise unvested at the time of such termination of
employment shall be automatically forfeited and cancelled in full, effective as
of such termination of employment.

 

(d)           Employment
Termination Date.  If the Employment
Period is in effect, the date of your termination of employment for purposes of
this Agreement shall be no earlier than the “Date of Termination,” as such
term is defined in the Employment Agreement.

 

II.            Timing and Form of Payment.

 

(a)           Distribution Date.  Unless you elect otherwise not more than
thirty (30) days after the Grant Date, the distribution date (the “Distribution
Date”) for your Units that become vested pursuant to this Agreement will be the
date that such Units vest.  Distribution
of your vested Units will be made by the Company in shares of Common Stock (on
a one-to-one basis) on or as soon as practicable after the Distribution Date
with respect to such vested Units.  You
will only receive distributions in respect of your vested Units and will have
no right to distribution of your unvested Units unless and until such Units
vest.  Once a vested Unit has been paid
pursuant to this Agreement, you will have no further rights with respect to
that Unit.  You may, however, elect (a “Distribution
Election”) to (A) defer your Distribution Date with respect to some or
all of your vested Units and/or (B) have your vested Units distributed to
you in annual installments as provided in Section II(b), provided that
such election complies with this Section II.  You may change your Distribution Election
with respect to each Tranche (set forth in Section I(a) above) up to
three times without the approval of the Committee, provided such Distribution
Election is made in a timely manner.  Any
Distribution Elections with respect to a Tranche in addition to the three
provided in the preceding sentence may only be made with the approval of the
Committee, in its sole discretion.  In
order for a Distribution Election to be valid, it must be made at least one
year prior to the then-existing Distribution Date with respect to the Units
subject to such Distribution Election, the new Distribution Date must be at
least five years after the then-existing Distribution Date with respect to such
Units, and the election must otherwise be

 

2

 

consistent
with Section 409A of the Code.  Your
Distribution Date with respect to any portion of your Units may not be prior to
the Vesting Date for such Units. 
Distribution Elections may only be made by delivering a written election
to the Company care of its General Counsel in the form attached as Exhibit A
hereto.

 

(b)           Form of
Distribution.  Unless you elect
otherwise, distribution of your vested Units with respect to any Tranche will
be made in a lump sum on or as soon as practicable after your Distribution Date.  You may, however, elect to have vested Units
with respect to any Tranche distributed in the form of two or more annual
installments over a fixed number of years, provided that each installment
payment must be for a minimum of 1,000 shares of Common Stock.  If you elect to have some or all of your
vested Units underlying a Tranche distributed in annual installments, the first
installment will be paid on or as soon as practicable after the Distribution
Date with respect to such Tranche and subsequent installments will be paid on
or as soon as practicable after each of the anniversaries of the Distribution
Date with respect to such Tranche during your elected installment period.  You may change an election you make pursuant
to this Section II(b) (or you may make an initial election in the
event that you did not elect a form of payment at the time of your award and,
accordingly, your Units were subject to the lump sum default payment rule) by
filing a new written election with the Committee; provided that you must also
elect a later Distribution Date pursuant to Section II(a) as to any
Units that are subject to such election and in no event may such an election
result in an acceleration of distributions within the meaning of Section 409A
of the Code.  Distribution Elections may
only be made by delivering a written election to the Company care of its
General Counsel in the form attached as Exhibit A hereto.

 

(c)           Hardship
Distribution.  If you experience an
Unforeseeable Emergency (as defined below) you may elect to receive immediate
distribution of some or all or your vested Units upon such Unforeseeable
Emergency.  Distribution upon an
Unforeseeable Emergency shall be made no later than thirty (30) days following
written notice to the Company care of its General Counsel of the Unforeseeable Emergency.
 For purposes of this Agreement, an “Unforeseeable
Emergency” shall mean a severe financial hardship resulting from (i) an
illness or accident of you, your spouse, or your dependent (as defined in Section 152(a) of
the Code), (ii) loss of your property due to casualty, or (iii) any
other similar extraordinary and unforeseeable circumstances arising as a result
of events beyond your control, all as reasonably determined by the Committee in
good faith.  No distribution shall be
made in respect of an Unforeseeable Emergency to the extent that such Unforeseeable
Emergency is or may be relieved through reimbursement or compensation by
insurance or otherwise or by liquidation of your assets (to the extent the
liquidation of such assets would not cause severe financial hardship).  Any distribution of your vested Units as a
result of an Unforeseeable Emergency shall be limited to the amount reasonably
necessary to relieve the Unforeseeable Emergency (which may include amounts
necessary to pay any federal, state or local income taxes or penalties
reasonably anticipated to result from the distribution).

 

III.           Dividend Equivalent Rights.  During such time as each Unit remains
outstanding and prior to the distribution of such Unit in accordance with Section II,
you will have the right to receive, in cash, with respect to such Unit, the
amount of any cash dividend paid on a share of Common Stock (a “Dividend
Equivalent Right”).  You will have a
Dividend Equivalent Right with respect to each Unit that is outstanding on the
record date of such dividend.  Dividend

 

3

 

Equivalent Rights will be paid to you at the same time
or within 30 days after dividends are paid to stockholders of the Company.  Dividend Equivalent Rights will not be paid
to you with respect to any Units that are forfeited pursuant to Section I(c),
effective as of the date such Units are forfeited.  You will have no Dividend Equivalent Rights
as of the record date of any cash dividend in respect of any Units that have
been paid in Common Stock; provided that you are the record holder of such
Common Stock on or before such record date.

 

IV.           Transferability.  No benefit payable under, or interest in, the
Units or this Agreement shall be subject in any manner to anticipation,
alienation, sale, transfer, assignment, pledge, encumbrance or charge and any
such attempted action shall be void and no such benefit or interest shall be,
in any manner, liable for, or subject to, your or your beneficiary’s debts,
contracts, liabilities or torts; provided, however,
nothing in this Section IV shall prevent transfers of your Units to the
Company or by will or applicable laws of descent and distribution.  You may designate a beneficiary to receive
distribution of your vested Units upon your death by submitting a written
beneficiary designation to the Committee in the form attached hereto as Exhibit A.  You may revoke a beneficiary designation by
submitting a new beneficiary designation.

 

V.            Withholding.  You will be required to pay in cash or
deduction from other compensation payable to you by the Company any sums
required by federal, state or local tax law to be withheld with respect to the
issuance, vesting or payment of Units and the payment of Dividend Equivalent
Rights.  At your election and in
satisfaction of the foregoing requirement, the Company will withhold shares of
Common Stock underlying the Units and otherwise issuable in accordance with Section II
hereof, in the manner prescribed by, and subject to the limitations of, Section 12
of the Plan, in satisfaction of such withholding obligations.

 

VI.           No Contract for Employment.  This Agreement is not an employment or
service contract and nothing in this Agreement shall be deemed to create in any
way whatsoever any obligation on your part to continue in the employ or service
of the Company, or of the Company to continue your employment or service with
the Company.

 

VII.          Notices.  Any notices provided for in this Agreement or
the Plan, including a Distribution Election, shall be given in writing and
shall be deemed effectively given upon receipt if delivered by hand or, in the
case of notices delivered by United States mail, five (5) days after
deposit in the United States mail, postage prepaid, addressed, as applicable,
to the Company or if to you, at such address as is currently maintained in the
Company’s records or at such other address as you hereafter designate by
written notice to the Company.

 

VIII.        Plan.  The provisions of the Plan are hereby made a
part of this Agreement.  In the event of
any conflict between the provisions of this Agreement and those of the Plan,
the provisions of this Agreement shall control.

 

IX.           Entire Agreement.  This Agreement, together with the Employment
Agreement, contains the entire understanding of the parties in respect of the
Units and supersedes upon its effectiveness all other prior agreements and
understandings between the parties with respect to the Units.  In the event of any discrepancy between this
Agreement and the Employment Agreement, the Employment Agreement shall control.

 

4

 

X.            Amendment.  This Agreement may be amended by the
Committee; provided, however that no such amendment shall, without your prior
written consent, alter, terminate, impair or adversely affect your rights under
this Agreement.

 

XI.           Governing Law.  This Agreement shall be construed and
interpreted, and the rights of the parties shall be determined, in accordance
with the laws of the State of California, without regard to conflicts of law
provisions thereof.

 

XII.         Tax Consequences.  You may be subject to adverse tax
consequences as a result of the issuance, vesting and/or distribution of your
Units.  YOU ARE ENCOURAGED TO CONSULT A
TAX ADVISOR AS TO THE TAX CONSEQUENCES OF YOUR UNITS AND SUBSEQUENT
DISTRIBUTION OF COMMON STOCK.

 

XIII.        Construction.  To the extent that this Agreement is subject
to Section 409A of the Code, you and the Company agree to cooperate and
work together in good faith to timely amend this Agreement to comply with Section 409A
of the Code.  In the event that you and
the Company do not agree as to the necessity, timing or nature of a particular
amendment intended to satisfy Section 409A of the Code, reasonable
deference will be given to your reasonable interpretation of such provisions.

 

[Remainder
of page intentionally left blank]

 

5

 

	
   

  	
  Very truly
  yours,

  
	
   

  	
   

  
	
   

  	
  HEALTH CARE
  PROPERTY INVESTORS, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/

  	
  Edward J.
  Henning

  
	
   

  	
  Name:

  	
  Edward J.
  Henning

  
	
   

  	
  Title:

  	
  Senior Vice
  President, General Counsel and

  
	
   

  	
   

  	
  Corporate
  Secretary

  
	
   

  	
   

  
	
  Accepted and
  Agreed,

  	
   

  
	
  effective as
  of the date first written above.

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  By:

  	
  /s/ James F.
  Flaherty III

  	
   

  	
   

  
	
  Name: James
  F. Flaherty III

  	
   

  
						

 

6

 

EXHIBIT A

 

HEALTH
CARE PROPERTY INVESTORS, INC.

2000 STOCK INCENTIVE PLAN

 

RESTRICTED
STOCK UNITS

DISTRIBUTION ELECTION AND BENEFICIARY DESIGNATION FORM

 

	
  Name: James F. Flaherty
  III

  	
  Social Security No.:

  

 

In connection with your award of Restricted Stock Units
on October 26, 2005 under the Health Care Property Investors, Inc.
2000 Stock Incentive Plan, as amended and/or restated from time to time (the “Plan”),
you have the option of selecting the timing and form of payment of the shares
of Common Stock underlying your vested Units.

 

Please complete this election
form and return it to Edward J. Henning, the Company’s General Counsel and
Corporate Secretary.

 

Deferral of Distribution Date

 

Unless you elect otherwise, the Distribution Date for
your Units that vest will be the vesting date of such Units.  You may elect a new Distribution Date with
respect to some or all of the Tranches by completing the deferral election grid
below.  Please note
that, subject to the restrictions set forth below and in the Agreement, your
new Distribution Date with respect to a Tranche can take any of the following
forms:

 

•                                          You may elect
a date certain for your Distribution Date (e.g., January 1, 2010),

 

•                                          You may elect
that your Distribution Date will be the date of your death or termination of employment,
or

 

•                                          You may elect
a Distribution Date that is the earlier of two dates/events (e.g., the earlier
of January 1, 2010, or termination of your employment).

 

If you do not elect a
Distribution Date by the date that is 30 days after the Grant Date, you will be
deemed to have elected distribution of your vested Units on or as soon as
administratively practical after the applicable vesting date of your
Units.  If, after the date that is 30
days after the Grant Date, you want to change the Distribution Date with respect
to any of your vested Units, your new election must be made at least one year
prior to the then-existing Distribution Date, the new Distribution Date you
elect must be at least five years after the then-existing Distribution
Date, and the change must otherwise satisfy Section 409A of the Code.  If your election to defer your Distribution
Date is not timely, it will not be valid.

 

You acknowledge and understand
that by electing a new Distribution Date with respect to one or more of the
Tranches, you are hereby revoking the then-existing Distribution Date with
respect to such Tranche(s).  You further
acknowledge and agree that the distribution

 

A-1

 

of the shares of Common Stock
underlying your Units may coincide with a period during which you are
prohibited from selling, disposing or otherwise transferring such shares
pursuant to the Company’s Insider Trading Policy, or by law, and therefore, you
may not be able to sell, dispose or otherwise transfer such shares to pay any
sums required by federal, state or local tax law to be withheld with respect to
the issuance of such shares.

 

	
  Tranche

  	
   

  	
  Vesting Date

  	
   

  	
  Distribution Date*

  
	
  1

  	
   

  	
  13
  Months After the Grant Date

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  2

  	
   

  	
  2nd Anniversary of Grant Date

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  3

  	
   

  	
  3rd Anniversary of Grant Date

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  4

  	
   

  	
  4th Anniversary of Grant Date

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  5

  	
   

  	
  5th Anniversary of Grant Date

  	
   

  	
   

  

 

*  Specify “Vesting Date” if you desire payment of the vested Units on or
as soon as administratively practical after the vesting date of the Units.  Otherwise, indicate the Distribution Date you
elect.  In all events your election is
subject to the rules stated above (including, without limitation, the 5-year
deferral requirement set forth above if you are electing a change on or after
the date that is 30 days after the Grant Date).

 

Form of Payment

 

Distribution of all of your vested Units underlying a
Tranche will be made in shares of Common Stock in a lump sum on or as soon as
practicable after the Distribution Date with respect to such Units.  For example, all of your vested Units under
Tranche 1 will be distributed to you on or as soon as practicable after the
Vesting Date with respect to Tranche 1 (unless you elect a later Distribution
Date as provided above).  You may,
however, elect at the time of your award to have vested Units with respect to
any Tranche distributed in the form of two or more annual installments over a
fixed number of years.  For example, if
you elect to have your vested Units underlying Tranche 1 distributed in five
installments, your vested Units will be distributed to you in five equal
payments on or as soon as practicable after the Distribution Date with respect
to Tranche 1 and each of the first four anniversaries of the Distribution Date
for Tranche 1.

 

If you elect to have any or all
of your vested Units underlying a Tranche distributed in installments, you must
elect a number of equal annual installments which will result in a distribution
of at least 1,000 shares of Common Stock per installment with respect to such
Tranche (otherwise, the number of installments you elected will be reduced by
the Company to produce a distribution of at least 1,000 shares of Common Stock
per installment).  If you would like to
change a form of distribution election you have made (or if you would like to
make an initial form of distribution election in the event that you did not
make such an election at the time of the award), your election must be made at
least one year prior to the then-existing Distribution Date, and you must elect
a new Distribution Date that is at least five years after the
then-existing Distribution Date.  If your
election to defer your Distribution Date is not timely, it will not be valid.  Furthermore, if you are

 

A-2

 

changing an existing form of
distribution election, your election change cannot result in an
acceleration (within the meaning of Section 409A of the Code) of payments,
and your change must otherwise be consistent with Section 409A of the Code.

 

	
  Tranche

  	
   

  	
  Vesting Date

  	
   

  	
  Number of Installments

  (Shares of Common Stock per

  Installment)

  
	
  1

  	
   

  	
  13
  Months After the Grant Date

  	
   

  	
          (      )

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  2

  	
   

  	
  2nd Anniversary of Grant Date

  	
   

  	
          (      )

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  3

  	
   

  	
  3rd Anniversary of Grant Date

  	
   

  	
          (      )

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  4

  	
   

  	
  4th Anniversary of Grant Date

  	
   

  	
          (      )

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  5

  	
   

  	
  5th Anniversary of Grant Date

  	
   

  	
          (      )

  

 

 

Beneficiary Designation

 

I hereby designate the following individual as
beneficiary to receive distribution of my vested Units, if any, in the event of
my death.  Distribution of such vested
Units will be in the form, and on the Distribution Date(s), in effect with
respect to such vested Units as of the date of my death.

 

	
  Beneficiary Information

  
	
   

  	
   

  	
   

  	
   

  
	
  Name:

  	
   

  	
   

  	
   

  
	
  (Please print)

  	
  Last

  	
  First

  	
  Middle Initial

  
	
   

  
	
  Sex:

  	
   

  	
    Relationship to
  Participant:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Social Security No.:

  	
   

  	
    Date of Birth:

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Address:

  	
   

  	
   

  
	
   

  
	
  City:

  	
   

  	
    State:

  	
   

  	
    Zip Code:

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Please retain a copy of
  this Distribution Election Form for your records.

  
	
   

  
	
   

  	
   

  	
   

  
	
  Signature: James F.
  Flaherty III

  	
   

  	
  Date Signed

  	
   

  
																				

 

A-3

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