EXHIBIT 10.21
SECURITY AGREEMENT
THIS SECURITY AGREEMENT (this "Agreement") is entered into as of this
25th day of October, 2002, by FVE-CHS LLC, a Delaware limited liability company,
(the "Tenant"), and SNH CHS Properties Trust, a Maryland real estate investment
trust (the "Secured Party").
W I T N E S S E T H:
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WHEREAS, pursuant to that certain Lease Agreement, dated as of the date
hereof (as amended from time to time, the "Lease"), the Secured Party leased to
the Tenant and the Tenant leased from the Secured Party, certain premises as
more particularly described in the Lease, subject to and upon the terms and
conditions set forth in the Lease; and
WHEREAS, as security for the payment and performance of each and every
obligation and liability of the Tenant to the Secured Party, whether now
existing or hereafter arising, under the Lease or any other document or
agreement executed and delivered pursuant thereto, including, without
limitation, the payment of the Rent (this and other capitalized terms used and
not otherwise defined herein having the meanings ascribed to such terms in
Section 1), and the payment and performance of each and every other obligation
of the Tenant to the Secured Party, whether now existing or hereafter arising,
whether direct or indirect, absolute or contingent, due or to become due
(collectively, the "Obligations"), the Tenant has agreed to grant to the Secured
Party a first and perfected lien and security interest in the Collateral;
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, the parties hereto hereby
agree as follows:
Section 1. Definitions. As used in this Agreement, the following terms
shall have the meanings specified below. Except as otherwise defined, terms
defined in the Uniform Commercial Code and used herein without definition shall
have the meanings given such terms in the Uniform Commercial Code.
"Affiliated Person" shall have the meaning given such term in the
Lease.
"Business Day" shall have the meaning given such term in the Lease.
"Collateral" shall mean all of the Tenant's right, title and interest
in and under or arising out of all and any personal property, intangibles and
fixtures of any type or description (other than Excluded Collateral), wherever
located and now existing or hereafter arising, or which constitute or arise from
the operation, maintenance or repair of the Leased Property or any portion
thereof, together with any and all additions and accessions thereto and
replacements, products, proceeds (including, without limitation, proceeds of
insurance) and supporting obligations thereof, including, but not limited to,
the following:
(a) all goods, including, without limitation, all Equipment; and
(b) all General Intangibles; and
(c) all other personal property or fixtures of any nature
whatsoever which relate to the operation, maintenance or
repair of the Leased Property, or any portion thereof, and all
property from time to time described in any financing
statement signed by the Tenant naming the Secured Party as
Secured Party; and
(d) all claims, rights, powers or privileges and remedies relating
to the foregoing or arising in connection therewith,
including, without limitation, all Licenses and Permits which
Tenant legally may grant a security interest in, rights to
make determinations, to exercise any election (including, but
not limited to, election of remedies) or option or to give or
receive any notice, consent, waiver or approval; all liens,
security, guaranties, endorsements, warranties and indemnities
and all insurance, eminent domain and condemnation awards and
claims therefor relating thereto or arising in connection
therewith; all rights to property forming the subject matter
of any of the foregoing, including, without limitation, rights
to stoppage in transit and rights to returned or repossessed
property; all writings relating to the foregoing or arising in
connection therewith; and
(e) all contract rights, general intangibles and other property
rights of any nature whatsoever arising out of or in
connection with any of the foregoing (other than Excluded
Collateral), including, without
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limitation, payments due or to become due, whether as
repayments, reimbursements, contractual obligations,
indemnities, damages or otherwise.
"Equipment" shall mean all buildings, structures, improvements,
fixtures and items of machinery, equipment and other tangible personal property
which constitute, arise from or relate to the operation, maintenance or repair
of the Leased Property or any portion thereof, together with all repairs,
replacements, improvements, substitutions, extensions or renewals thereof or
additions thereto, all parts, additions and accessories incorporated therein or
affixed thereto, and all "equipment" as such term is defined in the Uniform
Commercial Code, and all cash and non-cash proceeds therefrom.
"Event of Default" shall have the meaning given such term in Section 6.
"Excluded Collateral" shall mean Accounts or Chattel Paper, Support
Obligations, General Intangibles or Deposit Accounts relating to such Accounts
or Chattel Paper, Instruments or Investment Property evidencing or arising from
such Accounts or Chattel Paper, any documents, books, records or other
information (including, without limitation, computer programs, tapes, discs,
punch cards, data processing software and related property and rights)
maintained with respect to any of the foregoing or any Proceeds of any of the
foregoing.
"Facilities" shall have the meaning given such term in the Lease.
"General Intangibles" shall mean all present and future general
intangibles and contract rights (other than Excluded Collateral) which
constitute, arise from or relate to the operation, maintenance or repair of the
Leased Property, or any portion thereof, including, but not limited to, all
causes of action, corporate or business records, inventions, designs, patents,
patent applications, trademarks, trademark registrations and applications
therefor, goodwill, trade names, trade secrets, trade processes, copyrights,
copyright registrations and applications therefor, franchises, customer lists,
computer programs, claims under guaranties, tax refund claims, rights and claims
against carriers and shippers, leases, claims under insurance policies, all
rights to indemnification and all other intangible personal property of every
kind and nature which constitutes, arises from or relates to the operation,
maintenance or repair of the Leased Property, or any portion thereof.
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"Instrument" shall have the meaning give such term in Article 9 of the
Uniform Commercial Code.
"Lease" shall have the meaning given such term in the preamble to this
Agreement.
"Leased Property" shall have the meaning given such term in the Lease.
"Licenses" shall mean all certificates of need (if any), licenses,
permits, rights of use, covenants or rights otherwise benefiting or permitting
the use and operation of each applicable Property or any part thereof pertaining
to the operation, maintenance or repair of such Property or any portion thereof.
"Obligations" shall have the meaning given such term in the preamble to
this Agreement.
"Overdue Rate" shall have the meaning given to such term in the Lease.
"Permits" shall mean all permits, approvals, consents, waivers,
exemptions, variances, franchises, orders, authorizations, rights and licenses
obtained or hereafter obtained from any federal, state or other governmental
authority or agency relating to the operation, maintenance or repair, of each
applicable Property, or any portion thereof.
"Person" shall have the meaning given such term in the Lease.
"Property" shall have the meaning given such term in the Lease.
"Rent" shall have the meaning given such term in the Lease.
"Tenant" shall have the meaning given such term in the preamble to this
Agreement.
"Uniform Commercial Code" means Article 9 of the Uniform Commercial
Code as in effect in the Commonwealth of Massachusetts from time to time.
Section 2. Security Interest. As security for the prompt payment and
performance of all the Obligations, the Tenant hereby grants, pledges, transfers
and assigns to the Secured Party, their successors and assigns and all other
holders from time to time of the Obligations, a continuing security interest
under the Uniform Commercial Code from time to time in effect in
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the jurisdiction in which any of the Collateral is located in and a continuing
lien upon all of the Tenant's right, title and interest in the Collateral,
together with any and all additions thereto and replacements, products and
proceeds thereof, whether now existing or hereafter arising or acquired and
wherever located.
Section 3. General Representations, Warranties and Covenants. The
Tenant represents, warrants and covenants, which representations, warranties and
covenants shall survive execution and delivery of this Agreement, as follows:
(a) Each of the warranties and representations of the Tenant
contained herein, in the Lease or in any other document executed in connection
herewith or therewith are true and correct on the date hereof.
(b) Except for the lien granted to the Secured Party pursuant to
this Security Agreement and any liens permitted under the Lease, the Tenant is,
and as to the Collateral acquired from time to time after the date hereof the
Tenant will be, the owner of all the Collateral free from any lien, security
interest, encumbrance or other right, title or interest of any Person, except
for the security interest of the Secured Party therein, and the Tenant shall
defend the Collateral against all claims and demands of all Persons at any time
claiming the same or any interest therein adverse to the Secured Party. The lien
granted in this Agreement by the Tenant to the Secured Party in the Collateral
is not prohibited by and does not constitute a default under any agreements or
other instruments constituting a part of the Collateral, and no consent is
required of any Person to effect such lien which has not been obtained.
(c) Except as permitted under the Lease, there is no financing
statement (or similar statement or instrument of registration under the law of
any jurisdiction) now on file or registered in any public office covering any
interest of any kind in the Collateral, or intended so to be, which has not been
terminated, and so long as this Agreement remains in effect or any of the
Obligations or any obligations of any Affiliated Person of the Tenant to the
Secured Party remain unpaid, the Tenant will not execute and there will not be
on file in any public office any financing statement (or similar statement or
instrument of registration under the law of any jurisdiction) or statements
relating to the Collateral, except financing statements filed or to be filed in
respect of and covering the security interest of the Secured Party.
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(d) The chief executive office and the principal place of business
of the Tenant are as set forth in Schedule 1 and the Tenant will not move its
chief executive office or establish any other principal place of business except
to such new location as the Tenant may establish in accordance with this Section
3(d). The location of each Facility comprising a portion of the Leased Property
is as set forth in Schedule 2. The originals of all documents evidencing
Collateral and the only original books of account and records of the Tenant
relating thereto are, and will continue to be, kept at such chief executive
office or the applicable Facility, as the case may be, or at such new location
as the Tenant may establish in accordance with this Section 3(d). The Tenant
shall not move its chief executive office or establish any other principal place
of business until (i) the Tenant shall have given to the Secured Party not less
than ten (10) days' prior written notice of its intention to do so, which notice
shall clearly describe such new location and provide such other information in
connection therewith as the Secured Party may reasonably request, and (ii) with
respect to such new location, the Tenant shall have taken such action,
satisfactory to the Secured Party (including, without limitation, all action
required by Section 5), to maintain the security interest of the Secured Party
in the Collateral.
(e) All tangible personal property owned on the date hereof by the
Tenant to be used in connection with the operation or maintenance of the Leased
Property, or any portion thereof, is located at each applicable Property or is
in transit to such Property from the vendor thereof. The Tenant agrees that (i)
all such property held by the Tenant on the date hereof, once at each applicable
Property, shall remain at such Property and (ii) all such property subsequently
acquired by the Tenant shall immediately upon acquisition be transferred to and
remain at the applicable Property.
(f) The Tenant's corporate name and organizational identification
number are as set forth on the signature page hereto. The name under which each
of the Facilities is operated is set forth on Schedule 2. The Tenant shall not
(i) change such name without providing the Secured Party with thirty (30) days'
prior written notice and making all filings and taking all such other actions as
the Secured Party determines are necessary or appropriate to continue or perfect
the security interest granted hereunder, (ii) change its corporate
organizational number, nor (iii) conduct its business in any other name or take
title to any Collateral in any other name while this Agreement remains in
effect. Except as otherwise set forth on Schedule 1,
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the Tenant has not ever had any other name nor conducted business in any other
name in any jurisdiction. The Tenant is organized as a Maryland real estate
investment trust. Subject to the terms and conditions of the Lease, the Tenant
shall not change its organizational structure or jurisdiction of organization
without giving at least thirty (30) days' prior written notice thereof to the
Secured Party.
(g) The Secured Party is authorized (but is under no obligation)
to make, upon ten (10) Business Days' notice to the Tenant (except in the case
of exigent circumstances, in which circumstances upon such notice, if any, as
may then be reasonably practical), any payments which in the Secured Party's
opinion are necessary to:
(i) discharge any liens which have or may take priority over
the lien hereof; and
(ii) pay all premiums payable on the insurance policies referred
to in the Lease or any other document or agreement executed
in connection therewith or herewith, upon the failure of
the Tenant to make such payments within the time permitted
therein.
The Tenant shall have no claim against the Secured Party by reason of its
decision not to make any payments or perform such obligations permitted under
this Section 3(g). The Tenant shall repay to the Secured Party any sums paid by
the Secured Party upon demand. Any sums paid and expenses incurred by the
Secured Party pursuant to this paragraph shall bear interest at the Overdue
Rate.
(h) If any of the Collateral at any time becomes evidenced by an
Instrument, the Tenant shall promptly deliver such Instrument to the Secured
Party, appropriately endorsed to the order of the Secured Party, to be held
pursuant to this Agreement.
(i) The Tenant shall not sell, transfer, change the registration,
if any, of, dispose of, attempt to dispose of, or substantially modify or
abandon the Collateral or any material part thereof, other than as permitted
under the Lease, without the prior written consent of the Secured Party. Except
as permitted under the Lease, the Tenant shall not create, incur, assume or
suffer to exist any lien upon any of the Collateral without the prior written
consent of the Secured Party.
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(j) The Tenant shall not assert against the Secured Party any
claim or defense which the Tenant may have against any seller of the Collateral
or any part thereof or against any Person with respect to the Collateral or any
part thereof.
(k) The Tenant shall, upon demand, pay to the Secured Party the
amount of any and all reasonable expenses, including the reasonable fees and
expenses of its counsel and of any experts and agents, which the Secured Party
may incur in connection with (i) the administration of this Agreement, (ii) the
custody or preservation of, or the sale of, collection from, or other
realization upon, any of the Collateral, (iii) the exercise or enforcement of
any of the rights of the Secured Party hereunder and under such other agreements
or (iv) the failure by the Tenant to perform or observe any of the provisions
hereof.
(l) The Tenant shall indemnify and hold harmless the Secured Party
from and against any and all liabilities, obligations, losses, damages,
penalties, actions, judgments, suits, costs, expenses or disbursements of any
kind and nature whatsoever which may be imposed on, incurred by or asserted
against the Secured Party in any way relating to or arising out of this
Agreement or arising out of the Tenant's obligations under any other documents
contemplated by or referred to herein or therein or the transactions
contemplated hereby or thereby or the enforcement of any of the terms hereof or
of any such other documents.
Section 4. Special Provisions Concerning Equipment. The Tenant shall
not impair the rights of the Secured Party in the Equipment. Regardless of the
manner of the affixation of any Equipment to real property, the Equipment so
attached shall at all times constitute and remain personal property. The Tenant
retains all liability and responsibility in connection with the Equipment and
the liability of the Tenant to pay the Obligations shall in no way be affected
or diminished by reason of the fact that such Equipment may be lost, destroyed,
stolen or damaged or for any reason whatsoever have become unavailable to the
Tenant. Upon the request of the Secured Party, the Tenant shall provide to the
Secured Party a current list of Equipment.
Section 5. Financing Statements; Documentary Stamp Taxes.
(a) The Tenant shall, at its own expense, make, execute, endorse,
acknowledge, file and/or deliver to the Secured Party from time to time such
lists, descriptions and designations of inventory, warehouse receipts, bills of
lading, documents of title, vouchers, invoices, schedules, confirmatory
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assignments, conveyances, financing statements, transfer endorsements, powers of
attorney, certificates, reports and other assurances or instruments and take
such further steps relating to the Collateral and other property or rights
covered by the security interest hereby granted, which the Secured Party
reasonably deems appropriate or advisable to perfect, preserve or protect its
security interest in the Collateral. The Tenant authorizes the Secured Party to
file any such financing statements without the signature of the Tenant and the
Tenant will pay all applicable filing fees and related expenses. To the extent
permitted by law, a carbon, photographic or other reproduction of this Agreement
or a financing statement shall be sufficient as a financing statement.
(b) The Tenant shall procure, pay for, affix to any and all
documents and cancel any documentary tax stamps required by and in accordance
with, applicable law, and the Tenant shall indemnify and hold harmless the
Secured Party from and against any liability (including interest and penalties)
in respect of such documentary stamp taxes.
Section 6. Event of Default. For purposes of this Agreement, the term
"Event of Default" shall mean (a) the occurrence of an Event of Default under
the Lease or any document or agreement executed in connection therewith; (b) the
failure of the Tenant to comply with any of its covenants or obligations under
this Agreement and the continuance thereof for a period of ten (10) Business
Days after written notice thereof; (c) any representation or warranty contained
herein or made by the Tenant in connection herewith shall prove to have been
false or misleading in any material respect when made; or (d) the occurrence of
any default or event of default under any document, instrument or agreement
evidencing the Obligations.
Section 7. Remedies.
(a) Upon the occurrence and during the continuance of an Event of
Default, in addition to any rights and remedies now or hereafter granted under
applicable law, under the Lease or under any other documents or agreements
entered into in connection herewith or therewith, and not by way of limitation
of any such rights and remedies, the Secured Party shall have all of the rights
and remedies of a secured party under the Uniform Commercial Code as enacted in
any applicable jurisdiction, and the right, without notice to, or assent by, the
Tenant, in the name of the Tenant or in the name of the Secured Party or
otherwise:
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(i) with respect to the General Intangibles to ask for, demand,
collect, receive, compound and give acquittance therefor or
any part thereof, to extend the time of payment of,
compromise or settle for cash, credit or otherwise, and
upon any terms and conditions, any thereof, to exercise and
enforce any rights and remedies in respect thereof, and to
file any claims, commence, maintain or discontinue any
actions, suits or other proceedings deemed by the Secured
Party necessary or advisable for the purpose of collecting
or enforcing payment and performance thereof;
(ii) to take possession of any or all of the Collateral and to
use, hold, store, operate, merge and/or control the same
and to exclude the Tenant and all Persons claiming under it
wholly or partly therefrom, and, for that purpose, to
enter, with the aid and assistance of any Person or Persons
and with or without legal process, any premises where the
Collateral, or any part thereof, are, or may be, placed or
assembled, and to remove any such Collateral;
(iii) from time to time, at the expense of the Tenant, to make
all such repairs, replacements, alterations, additions and
improvements to and of the Collateral as the Secured Party
may reasonably deem proper; to carry on the business and to
exercise all rights and powers of the Tenant in respect to
the Collateral, as the Secured Party shall deem best,
including the right to enter into any and all such
agreements with respect to the leasing, management and/or
operation of the Collateral or any part thereof as the
Secured Party may see fit; to collect and receive all
rents, issues, profits, fees, revenues and other income of
the same and every part thereof which rents, issues,
profits, fees, revenues and other income may be applied to
pay the expenses of holding and operating the Collateral
and of conducting the business thereof, and of all
maintenance, repairs, replacements, alterations, additions
and improvements, and to make all payments which the
Secured Party may be required or may elect to make, if any,
for taxes, assessments, insurance
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and other charges upon the Collateral or any part thereof,
and all other payments which the Secured Party may be
required or authorized to make under any provision of this
Agreement (including, without limitation, reasonable legal
costs and attorneys' fees);
(iv) to execute any instrument and do all other things necessary
and proper to protect and preserve and realize upon the
Collateral and the other rights contemplated hereby;
(v) upon notice to such effect, to require the Tenant to
deliver, at the Tenant's expense, any or all Collateral
which is reasonably movable to the Secured Party at a place
designated by the Secured Party, and after delivery thereof
the Tenant shall have no further claim to or interest in
the Collateral; and
(vi) without obligation to resort to other security, at any time
and from time to time, to sell, re-sell, assign and deliver
all or any of the Collateral, in one or more parcels at the
same or different times, and all right, title and interest,
claim and demand therein and right of redemption thereof,
at public or private sale, for cash, upon credit or for
future delivery, and at such price or prices and on such
terms as the Secured Party may determine, with the amounts
realized from any such sale to be applied to the Secured
Obligations in the manner determined by the Secured Party.
The Tenant hereby agrees that all of the foregoing may be effected without
demand, advertisement or notice (except as hereinafter provided or as may be
required by law), all of which (except as hereinafter provided) are hereby
expressly waived, to the maximum extent permitted by law. The Secured Party
shall not be obligated to do any of the acts hereinabove authorized and in the
event that the Secured Party elects to do any such act, the Secured Party shall
not be responsible to the Tenant.
(b) Upon the occurrence and during the continuance of an Event of
Default, the Secured Party may take legal proceedings for the appointment of a
receiver or receivers (to which the Secured Party shall be entitled as a matter
of right) to take possession of the Collateral pending the sale thereof pursuant
either to the powers of sale granted by this Agreement
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or to a judgment, order or decree made in any judicial proceeding for the
foreclosure or involving the enforcement of this Agreement. If, after the
exercise of any or all of such rights and remedies, any of the Obligations shall
remain unpaid or unsatisfied, the Tenant shall remain liable for any deficiency
or performance thereof, as applicable.
(c) Upon any sale of any of the Collateral, whether made under the
power of sale hereby given or under judgment, order or decree in any judicial
proceeding for the foreclosure or involving the enforcement of this Agreement:
(i) the Secured Party may bid for and purchase the property
being sold and, upon compliance with the terms of sale, may
hold, retain and possess and dispose of such property in
its own absolute right without further accountability, and
may, in paying the purchase money therefor, deliver any
instruments evidencing the Obligations or agree to the
satisfaction of all or a portion of the Obligations in lieu
of cash in payment of the amount which shall be payable
thereon, and such instruments, in case the amounts so
payable thereon shall be less than the amount due thereon,
shall be returned to the Secured Party after being
appropriately stamped to show partial payment;
(ii) the Secured Party may make and deliver to the purchaser or
purchasers a good and sufficient deed, bill of sale and
instrument of assignment and transfer of the property sold;
(iii) all right, title, interest, claim and demand whatsoever,
either at law or in equity or otherwise, of the Tenant of,
in and to the property so sold shall be divested; such sale
shall be a perpetual bar both at law and in equity against
the Tenant, its successors and assigns, and against any and
all Persons claiming or who may claim the property sold or
any part thereof from, through or under the Tenant, its
successors or assigns;
(iv) the receipt of the Secured Party or of the officers thereof
making such sale shall be a sufficient discharge to the
purchaser or purchasers at such sale for his or their
purchase money, and such purchaser or
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purchasers, and his or their assigns or personal
representatives, shall not, after paying such purchase
money and receiving such receipt of the Secured Party or of
such officer therefor, be obliged to see to the application
of such purchase money or be in any way answerable for any
loss, misapplication or nonapplication thereof; and
(v) to the extent that it may lawfully do so, the Tenant agrees
that it will not at any time insist upon, or plead, or in
any manner whatsoever claim or take advantage of, any
appraisement, valuation, stay, extension or redemption
laws, or any law permitting it to direct the order in which
the Collateral or any part thereof shall be sold, now or at
any time hereafter in force, which may delay, prevent or
otherwise affect the performance or enforcement of this
Agreement or any other document, the Lease or any other
document or agreement entered into in connection herewith
or therewith, and the Tenant hereby expressly waives all
benefit or advantage of any such laws and covenants that it
will not hinder, delay or impede the execution of any power
granted or delegated to the Secured Party in this
Agreement, but will suffer and permit the execution of
every such power as though no such laws were in force.
In the event of any sale of Collateral pursuant to this Section 7, the Secured
Party shall, at least ten (10) days before such sale, give the Tenant written
notice of its intention to sell, except that, if the Secured Party shall
determine in its reasonable discretion that any of the Collateral threatens to
decline in value, any such sale may be made upon three (3) days' written notice
to the Tenant, which time periods the Tenant hereby agrees are reasonable.
(d) The Secured Party is hereby irrevocably appointed the true and
lawful attorney-in-fact of the Tenant in its name and stead, to make all
necessary deeds, bills of sale and instruments of assignment and transfer of the
property sold pursuant to this Section 7 and for such other purposes as are
necessary or desirable to effectuate the provisions of this Agreement, and for
that purpose it may execute and deliver all necessary deeds, bills of sale and
instruments of assignment and transfer, and may substitute one or more Persons
with like
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power, the Tenant hereby ratifying and confirming all that its
said attorney, or such substitute or substitutes, shall lawfully do by virtue
hereof. If so requested by the Secured Party or by any purchaser, the Tenant
shall ratify and confirm any such sale or transfer by executing and delivering
to the Secured Party or to such purchaser all property, deeds, bills of sale,
instruments or assignment and transfer and releases as may be designated in any
such request.
Section 8. Application of Moneys. All moneys which the Secured Party
shall receive pursuant hereto shall first be applied (to the extent thereof) to
the payment of all reasonable costs and expenses incurred in connection with the
administration and enforcement of, or the preservation of any rights under, this
Agreement or any of without limitation, the reasonable fees and disbursements of
its counsel and agents), and the balance, if any, shall be applied first to
accrued and unpaid interest, charges and fees on, and then to outstanding
principal of, any Obligations of the Tenant (or its affiliates) to the Secured
Party, and then to any other amounts outstanding on any such Obligations and
then as required by law to any other parties having an interest therein.
Section 9. Waivers, Etc. The Tenant, on its own behalf and on behalf of
its successors and assigns, hereby waives presentment, demand, notice, protest
and, except as is otherwise specifically provided herein, all other demands and
notices in connection with this Agreement or the enforcement of the rights of
the Secured Party hereunder or in connection with any Obligations or any
Collateral; waives all rights to require a marshaling of assets by the Secured
Party; consents to and waives notice of (i) the substitution, release or
surrender of any Collateral, (ii) the addition or release of Persons primarily
or secondarily liable on any Obligation or on any Collateral, (iii) the
acceptance of partial payments on any Collateral and/or the settlement or
compromise thereof, (iv) any requirement of diligence or promptness on the part
of the Secured Party in the enforcement of any rights in respect of any
Collateral or any other agreement or instrument directly or indirectly relating
thereto, and (v) any enforcement of any present or future agreement or
instrument relating directly or indirectly to the Collateral. No delay or
omission on the part of the Secured Party or any holder of Obligations in
exercising any right hereunder shall operate as a waiver of such right or of any
other right hereunder. No waiver of any such right on any one occasion shall be
construed as a bar to or waiver of any such right on any future occasion. No
course of dealing between the Tenant and the Secured Party or any holder of
Obligations,
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nor any failure to exercise, nor any delay in exercising, on the part
of the Secured Party or any holder of Obligations, any right, power or privilege
hereunder or under any of the Obligations, shall operate as a waiver thereof;
nor shall any single or partial exercise of any right, power or privilege
hereunder or thereunder preclude any other or further exercise thereof, or the
exercise of any other right, power or privilege.
The Tenant further waives any right it may have under the constitution
of any state or commonwealth in which any of the Collateral may be located, or
under the Constitution of the United States of America, to notice (except for
notice specifically required hereby) or to a judicial hearing prior to the
exercise of any right or remedy provided by this Agreement to the Secured Party,
and waives its rights, if any, to set aside or invalidate any sale duly
consummated in accordance with the foregoing provisions hereof on the grounds
(if such be the case) that the sale was consummated without a prior judicial
hearing. THE TENANT'S WAIVERS UNDER THIS SECTION 9 HAVE BEEN MADE VOLUNTARILY,
INTELLIGENTLY AND KNOWINGLY AND AFTER THE TENANT HAS BEEN APPRISED AND COUNSELED
BY ITS ATTORNEYS AS TO THE NATURE THEREOF AND ITS POSSIBLE ALTERNATIVE RIGHTS.
The Secured Party shall not be required to marshal any present or
future security for (including without limitation this Agreement and the
Collateral pledged hereunder), or guaranties of, the Obligations or any of them,
or to resort to such security or guaranties in any particular order; and all of
the rights hereunder and in respect of such securities and guaranties shall be
cumulative and in addition to all other rights, however existing or arising. To
the maximum extent permitted by applicable law, the Tenant hereby agrees that it
will not invoke any law relating to the marshalling of collateral which, might
cause delay in or impede the enforcement of the Secured Party's rights under
this Agreement or under any other instrument evidencing any of the Obligations
or under which any of the Obligations is outstanding or by which any of the
Obligations is secured or guaranteed, and, to the maximum extent permitted by
applicable law, the Tenant hereby irrevocably waives the benefits of all such
laws.
Section 10. Further Assurances as to Collateral; Attorney-in-Fact. From
time to time hereafter, the Tenant will execute and deliver, or will cause to be
executed and delivered, such additional instruments, certificates or documents
(including, without limitation, financing statements, renewal statements,
mortgages, collateral assignments and other security documents), and will take
all such actions as the Secured Party may
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reasonably request, for the purposes of implementing or effectuating the
provisions of this Agreement or of more fully perfecting or renewing the Secured
Party's rights with respect to the Collateral (or with respect to any additions
thereto or replacements or proceeds thereof or with respect to any other
property or assets hereafter acquired by the Tenant which may be deemed to be a
part of the Collateral) pursuant hereto and thereto. The Secured Party is hereby
appointed the attorney-in-fact, with full power of substitution, of the Tenant
for the purpose of carrying out the provisions of this Agreement and taking any
action, including, without limitation, executing, delivering and filing
applications, certificates, instruments and other documents and papers with
governmental authorities, and executing any instruments, including without
limitation financing or continuation statements, deeds to secure debt,
mortgages, assignments, conveyances, assignments and transfers which are
required to be taken or executed by the Tenant under this Agreement, on its
behalf and in its name which appointment is coupled with an interest, is
irrevocable and durable and shall survive the subsequent dissolution, disability
or incapacity of the Tenant.
Section 11. Arbitration. The Secured Party or the Tenant may elect to
submit any dispute hereunder that has an amount in controversy in excess of
$250,000 to arbitration hereunder. Any such dispute shall be resolved in
accordance with the Commercial Arbitration Rules of the American Association
then pertaining and the decision of the arbitrators with respect to such dispute
shall be binding, final and conclusive on the parties.
In the event the Secured Party or the Tenant shall elect to submit any
such dispute to arbitration hereunder, the Secured Party and the Tenant shall
each appoint and pay all fees of a fit and impartial person as arbitrator with
at least ten (10) years' recent professional experience in the general subject
matter of the dispute. Notice of such appointment shall be sent in writing by
each party to the other, and the arbitrators so appointed, in the event of their
failure to agree within thirty (30) days after the appointment of the second
arbitrator upon the matter so submitted, shall appoint a third arbitrator. If
either the Secured Party or the Tenant shall fail to appoint an arbitrator, as
aforesaid, for a period of twenty (20) days after written notice from the other
party to make such appointment, then the arbitrator appointed by the party
having made such appointment shall appoint a second arbitrator and the two (2)
so appointed shall, in the event of their failure to agree upon any decision
within thirty (30) days thereafter, appoint a third arbitrator. If such
arbitrators fail to agree upon a third
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arbitrator within forty five (45) days after the appointment of the second
arbitrator, then such third arbitrator shall be appointed by the American
Arbitration Association from its qualified panel of arbitrators, and shall be a
person having at least ten (10) years' recent professional experience as to the
subject matter in question. The fees of the third arbitrator and the expenses
incident to the proceedings shall be borne equally between the Secured Party and
the Tenant, unless the arbitrators decide otherwise. The fees of respective
counsel engaged by the parties, and the fees of expert witnesses and other
witnesses called for the parties, shall be paid by the respective party engaging
such counsel or calling or engaging such witnesses.
The decision of the arbitrators shall be rendered within thirty (30)
days after appointment of the third arbitrator. Such decision shall be in
writing and in duplicate, one counterpart thereof to be delivered to the Secured
Party and one to the Tenant. A judgment of a court of competent jurisdiction may
be entered upon the award of the arbitrators in accordance with the rules and
statutes applicable thereto then obtaining.
Section 12. Miscellaneous.
(a) The Tenant agrees that its obligations and the rights of the
Secured Party hereunder and in respect of the Obligations may be enforced by
specific performance hereof and thereof and by temporary, preliminary and/or
final injunctive relief relating hereto and thereto, without necessity for proof
by the Secured Party or any holder of the Obligations that it would otherwise
suffer irreparable harm, and the Tenant hereby consents to the issuance of such
specific and injunctive relief.
(b) Any notice or demand upon the Tenant or the Secured Party
shall be deemed to have been sufficiently given when given in accordance with
the provisions of the Lease.
(c) None of the terms and conditions of this Agreement may be
changed, waived, modified or varied in any manner whatsoever unless in writing
duly signed by the Tenant and the Secured Party. No notice to or demand on the
Tenant in any case shall entitle the Tenant to any other or further notice or
demand in similar or other circumstances or constitute a waiver of any of the
rights of the Secured Party to any other or further action in any circumstances
without notice or demand.
(d) The obligations of the Tenant hereunder shall remain in full
force and effect without regard to, and shall not be impaired by, (i) any
bankruptcy, insolvency, reorganization,
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arrangement, readjustment, composition, liquidation or the like of the Tenant;
(ii) any exercise or non-exercise, or any waiver of, any right, remedy, power or
privilege under or in respect of this Agreement, the Lease or any document or
agreement executed in connection herewith or therewith, the Obligations or any
security for any of the Obligations; or (iii) any amendment to or modification
of any of the Lease or any document or agreement executed in connection herewith
or therewith, the Obligations or any security for any of the Obligations;
whether or not the Tenant shall have notice or knowledge of any of the
foregoing. The rights and remedies of the Secured Party herein provided for are
cumulative and not exclusive of any rights or remedies which the Secured Party
would otherwise have, including, without limitation, under the Lease or any
document or agreement executed in connection herewith or therewith. This
Agreement is intended as a supplement for and is not intended to supersede in
any respect the Lease or any document or agreement executed in connection
herewith or therewith.
(e) This Agreement shall be binding upon the Tenant and its
successors and assigns and shall inure to the benefit of the Secured Party, and
its respective successors and assigns. All agreements, representations and
warranties made herein shall survive the execution and delivery of this
Agreement.
(f) The descriptive headings of the several sections of this
Agreement are inserted for convenience only and shall not in any way affect the
meaning or construction of any provision of this Agreement.
(g) Any provision of this Agreement which is prohibited or
unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective
to the extent of such prohibition or unenforceability without invalidating the
remaining provisions hereof, and any such prohibitions or unenforceability in
any jurisdiction shall not invalidate or render unenforceable such provision in
any other jurisdiction.
(h) This Agreement shall be interpreted, construed, applied and
enforced in accordance with the laws of the Commonwealth of Massachusetts
applicable to contracts between residents of Massachusetts which are to be
performed entirely within Massachusetts, regardless of (i) where this Agreement
is executed or delivered; or (ii) where any payment or other performance
required by this Agreement is made or required to be made; or (iii) where any
breach of any provision of this Agreement occurs, or any cause of action
otherwise accrues; or (iv) where any action or other proceeding is instituted or
pending; or (v) the nationality, citizenship, domicile,
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principle place of business, or jurisdiction of organization or domestication of
any party; or (vi) whether the laws of the forum jurisdiction otherwise would
apply the laws of a jurisdiction other than the Commonwealth of Massachusetts;
or (vii) any combination of the foregoing. Notwithstanding the foregoing, to the
extent that matters of title, or creation, perfection and priority of the
security interests created hereby, or procedural issues of foreclosures are
required to be governed by the laws of the state in which the Collateral, or
relevant part thereof, is located, the laws of such State shall apply.
Section 13. Nonliability of Trustees. THE DECLARATION OF TRUST
ESTABLISHING THE SECURED PARTY, A COPY OF WHICH, TOGETHER WITH ALL AMENDMENTS
THERETO (THE "DECLARATION"), IS DULY FILED WITH THE DEPARTMENT OF ASSESSMENTS
AND TAXATION OF THE STATE OF MARYLAND, PROVIDES THAT THE NAME "SNH CHS
PROPERTIES TRUST," REFERS TO THE TRUSTEES UNDER THE DECLARATION COLLECTIVELY AS
TRUSTEES, BUT NOT INDIVIDUALLY OR PERSONALLY, AND THAT NO TRUSTEE, OFFICER,
SHAREHOLDER, EMPLOYEE OR AGENT OF THE SECURED PARTY SHALL BE HELD TO ANY
PERSONAL LIABILITY, JOINTLY OR SEVERALLY, FOR ANY OBLIGATION OF OR CLAIM
AGAINST, THE SECURED PARTY. ALL PERSONS DEALING WITH THE SECURED PARTY, IN ANY
WAY, SHALL LOOK ONLY TO THE ASSETS OF THE SECURED PARTY FOR THE PAYMENT OF ANY
SUM OR THE PERFORMANCE OF ANY OBLIGATION.
[Remainder of page intentionally left blank.]
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed under seal as of the date first above written.
TENANT:
FVE-CHS LLC
a Delaware limited liability company
By: /s/ Bruce J. Mackey Jr.
----------------------------------------
Bruce J. Mackey Jr.
Its: Treasurer and Chief Financial Officer
Corporate Organizational Number:
3561208
SECURED PARTY:
SNH CHS PROPERTIES TRUST
a Maryland real estate investment trust
By: /s/ John R. Hoadley
--------------------------------------
John R. Hoadley
Its: Treasurer
SCHEDULE 1
CHIEF EXECUTIVE OFFICE:
400 Centre Street
Newton, Massachusetts 02458
PRINCIPAL PLACE OF BUSINESS:
400 Centre Street
Newton, Massachusetts 02458
SCHEDULE 2
KANSAS:
OVERLAND PARK PLACE
6555 West 75th Street
Overland Park, KS 66204
MARYLAND:
ASPENWOOD
14400 Homercrest Road
Silver Spring, MD 20906
HEARTFIELDS AT BOWIE
7600 Laurel Bowie Road
Bowie, MD 20715
HEARTFIELDS AT EASTON
700 Port Street
Easton, MD 21601
HEARTFIELDS AT FREDERICK (Dearbought Community)
1820 Latham Drive
Frederick, MD 21701
HEARTLANDS AT SEVERNA PARK
715 Benfield Road
Severna Park, MD 21146
NORTH CAROLINA:
HEARTFIELDS AT CARY
1050 Crescent Green Drive
Cary, NC 27511
VIRGINIA:
HEARTFIELDS AT FREDERICKSBURG
20 HeartsField Lane
Fredericksburg, VA 22405
HEARTSFIELD AT RICHMOND
501 North Allen Avenue
(Corner of Grace)
Richmond, VA 23220