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Exhibit
10.2
AMENDED AND RESTATED
UNCONDITIONAL AND
CONTINUING LEASE
GUARANTY
THIS AMENDED AND RESTATED
UNCONDITIONAL AND CONTINUING LEASE GUARANTY
(“Guaranty”) is made effective as of June 6, 2007
(the “Effective Date”) by LIFECARE HOLDINGS,
INC. , a corporation organized under the laws of the State of
Delaware (“LifeCare”), SAN ANTONIO SPECIALTY
HOSPITALS, LTD. , a limited partnership organized under the
laws of the State of Texas (“San Antonio Subtenant”),
and LIFECARE HOSPITALS OF MILWAUKEE, INC. , a corporation
organized under the laws of the State of Delaware (“Waukesha
Subtenant”), in favor of HEALTH CARE REIT, INC. , a
corporation organized under the laws of the State of Delaware
(“Landlord”), HCRI TEXAS PROPERTIES, LTD. ,
a limited partnership organized under the laws of the State of
Texas (“HCRI-TX” and a “Landlord”), and
HCRI WISCONSIN PROPERTIES, LLC , a limited liability
company organized under the laws of the State of Wisconsin
(“HCRI-WI” and a “Landlord”).
RECITALS
A. Landlord and Life Care
REIT 1, Inc., a corporation organized under the laws of the
State of Delaware (“Tenant”), are entering into a lease
of certain real property (“Property”) pursuant to an
Amended and Restated Master Lease Agreement of even date
(“Lease”). Tenant is entering or has entered into a
Sublease with Waukesha Subtenant and San Antonio (individually and
collectively “Subtenant”) for a portion of the
Property. Any capitalized term not defined in this Guaranty which
is defined in the Lease shall have the meaning set forth in the
Lease.
B. In order to enter into the
Lease to Tenant, Landlord requires that this Guaranty be provided
by Life Care, Waukesha Subtenant and San Antonio Subtenant
(individually and collectively “Guarantor”). LifeCare
is the parent of Tenant. LifeCare’s wholly-owned subsidiary,
LifeCare Holdings Company of Texas, a Nevada limited liability
company, is the sole general partner of San Antonio Subtenant and
the sole owner of Waukesha Subtenant. Each of LifeCare and
Subtenant has determined that each will benefit from the Lease to
Tenant and has agreed to provide this Guaranty to
Landlord.
C. As used herein,
“Lease Documents” means the Lease and all other
documents and agreements made by Tenant in connection with the
Lease, as amended, modified, renewed or extended from time to time.
“Credit” means all rent, late charges, interest, taxes,
utility charges, insurance premiums and all other charges, expenses
and amounts payable by Tenant to Landlord pursuant to the Lease
Documents. “Security” includes all guaranties of any
Credit, all interests in real or personal property securing the
payment of any Credit or any guaranties of any Credit, and all
other agreements, rights or interests insuring or guaranteeing
payment of any Credit. “Lease Obligations” means all of
the covenants, obligations and liabilities of Tenant and Guarantor,
if any, under the Lease Documents, including the payment of the
Credit when due.
NOW, THEREFORE, in
consideration of the premises and for other good and valuable
consideration, the receipt and sufficiency of which are hereby
acknowledged, Landlord and Guarantor agree as follows:
1. Guaranty .
Guarantor unconditionally guarantees the prompt payment when due of
the Credit and the performance of the Lease Obligations and shall
indemnify Landlord and hold Landlord harmless from any costs and
expenses in any way arising out of Tenant’s failure to repay
the Credit or perform the Lease Obligations according to their
terms.
2. Warranties
.
(a) Capacity .
LifeCare and Waukesha Subtenant are each a corporation duly
organized, validly existing and in good standing under the laws of
the State of Delaware and warrant that each has taken all necessary
corporate action to incur the obligations of this Guaranty and to
execute, deliver and perform this Guaranty. San Antonio Subtenant
is a limited partnership duly organized, validly existing and in
good standing under the laws of the State of Texas and warrants
that it has taken all necessary action to incur the obligations of
this Guaranty and to execute, deliver and perform this
Guaranty.
(b) Contracts .
LifeCare and Waukesha Subtenant each warrant that there is no
provision of its respective Articles of Incorporation or Bylaws or
any existing indenture, contract or agreement to which it is a
party or of any law, administrative regulation, court order or
consent decree that would be contravened by the execution, delivery
or performance of this Guaranty. San Antonio Subtenant warrants
that there is no provision of its partnership agreement or any
existing indenture, contract or agreement to which it is a party or
of any law, administrative regulation, court order or consent
decree that would be contravened by the execution, delivery or
performance of this Guaranty.
(c) Inducement to
Landlord; Waivers . Guarantor [1] acknowledges that
Landlord would not have extended the Credit to Tenant and will not
continue to extend Credit to Tenant but for this Guaranty;
[2] warrants that Guarantor has given this Guaranty to induce
Landlord to extend and to continue to extend Credit to Tenant;
[3] agrees that Landlord may rely on this Guaranty in
extending future Credit to Tenant without notice to Guarantor;
[4] warrants that Guarantor has received good and valuable
consideration for this Guaranty; [5] waives acceptance of this
Guaranty; [6] warrants that Guarantor has not given this
Guaranty in reliance upon the existence of any Security;
[7] acknowledges receipt of notice of all Credit extended
before this date; [8] waives notice of any Credit extended
after this date; [9] waives protest and any other notice of
failure to pay the Credit or to perform any agreement relating to
any Credit or Security; [10] acknowledges that Guarantor has
read this Guaranty, the Lease and all other documents in connection
with the Lease; and [11] acknowledges that Guarantor
understands and agrees to Guarantor’s obligations under this
Guaranty.
(d) No Reliance on
Information about Tenant from Landlord . Guarantor
[1] warrants that Guarantor has not relied on any information
about Tenant, the Security or any guarantor of the Credit provided
directly or indirectly by Landlord; [2] warrants that
Guarantor is familiar with Tenant, Tenant’s affairs, and the
Security; [3] warrants that Guarantor has had ample
opportunity to investigate Tenant, Tenant’s affairs, the
Security, and the effect that the Credit will have;
[4] warrants that Guarantor has been
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provided all information
concerning Tenant, Tenant’s affairs, and the Security that
Guarantor has requested; [5] warrants that Guarantor has had
adequate opportunity to seek and evaluate professional advice
concerning Tenant, the Security and this Guaranty from advisors of
Guarantor’s choosing, including financial and legal advice;
and [6] agrees that Guarantor shall not rely on any
information provided by Landlord about Tenant or the Security,
including any other guarantor. Guarantor shall continue to
investigate and evaluate Tenant and the Security independently
throughout the term of this Guaranty, and Landlord has no
obligation to provide Guarantor any information about Tenant or the
Security.
(e) No Insolvency . On
the date of Guarantor’s entering into this Guaranty and after
giving effect to all indebtedness of Guarantor, Guarantor
reasonably believes that [1] Guarantor will be able to pay
Guarantor’s obligations as they become due and payable;
[2] the present fair saleable value of Guarantor’s
assets exceeds the amount that will be required to pay
Guarantor’s probable liability on its obligations as the same
become absolute and mature; [3] the sum of Guarantor’s
property at a fair valuation exceeds Guarantor’s
indebtedness; and [4] Guarantor will have sufficient capital
to engage in Guarantor’s businesses. The proceeds of the
Credit constitute fair consideration and reasonably equivalent
value for this Guaranty.
3. Waivers . Without
notice to or consent of Guarantor, Landlord may do or refrain from
doing anything affecting any Credit or any Security, including the
following: [a] granting or not granting any indulgences to
anyone liable for payment of the Credit or any Security;
[b] failing to get or to perfect any Security;
[c] failing to get an enforceable agreement to repay the
Credit; [d] releasing any Security or anyone or any property
from liability for payment of the Credit; [e] changing the
Lease or any agreement relating to the Credit or any Security;
[f] extending the time for payment of the Credit, including
extending the time beyond the term of the Lease;
[g] exercising any right or remedy, including, without
limitation, eviction of Tenant or termination of the Lease;
[h] applying any funds received from Tenant, Guarantor or any
other party and any funds realized from any Security in such manner
and in such order or priority as Landlord elects in its sole
discretion; and [i] delaying in enforcing or failing to
enforce any rights to payment of the Credit or rights against any
Security. In the event that Landlord forecloses or otherwise
realizes on any Security for repayment of the Credit, Guarantor
agrees that the purchase price at any judicial or other sale of the
Security paid by Landlord or any other party shall be conclusive
evidence of the value of the Security, and Landlord shall have an
absolute right to obtain a deficiency judgment of all amounts due
in excess of such purchase price, to the extent permitted by
applicable law. Guarantor waives the right to contest the value of
the Security through appraisals or otherwise, and waives any
defense to a deficiency judgment that Guarantor may have pursuant
to any statute or other applicable law.
FOR TEXAS –
WHEN GUARANTOR IS GENERAL PARTNER OF PARTNERSHIP TENANT OR IS
MEMBER OF LLC TENANT: GUARANTOR HEREBY AGREES THAT LANDLORD IS NOT
REQUIRED TO COMPLY WITH §3.05(d) OF ARTICLE 6132(b) OF
THE TEXAS CODE AND THAT THE LIMITATIONS OF SUCH SECTION SHALL NOT
APPLY TO ANY ACTION BY LANDLORD AGAINST GUARANTOR ARISING WITH
RESPECT TO THE CREDIT OR THIS GUARANTY.
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4. Defects in Security,
Etc. Guarantor’s liability under this Guaranty shall not
be affected by [a] any default in any document concerning any
Credit or Security when accepted by Landlord or arising any time
thereafter; [b] the unenforceability of or defect in any
Security or document relating to any Credit; [c] any decline
in the value of any Security; [d] Landlord’s failure to
obtain any Security or to perfect Landlord’s security
interest therein; [e] the death, incompetence, insolvency,
dissolution, liquidation or winding up of affairs of Tenant,
Guarantor or anyone liable for any Security or the start of
insolvency proceedings by or against any such person or entity;
[f] any termination of the leasehold estate created by the
Lease to the extent Tenant remained liable under the Lease;
[g] the release or discharge of Tenant in any
creditor’s, receivership, bankruptcy, other insolvency
proceedings, or other proceedings; [h] impairment, limitation
or modification of the liability of Tenant or the estate of Tenant
in bankruptcy or of any remedy for the enforcement of
Tenant’s liability under the Lease, resulting from the
operation of any present or future provisions of the federal
Bankruptcy Code or other statutes or from the decision of any
court; [i] the rejection or disaffirmance of the Lease in any
such proceedings; [j] the assignment or transfer of the Lease
by Tenant; [k] any disability or other defense of Tenant;
[l] the cessation from any cause whatsoever of the liability
of Tenant under the Lease; or [m] any reorganization, merger,
consolidation, combination or sale of substantially all the assets
of Tenant.
5. Waiver of
Surety’s Defenses . GUARANTOR WAIVES ALL SURETYSHIP
AND OTHER SIMILAR DEFENSES.
6. Unconditional
Obligation . If Tenant fails to pay all or any part of any
Credit when due after expiration of any applicable grace, notice or
cure period, Guarantor shall immediately pay to Landlord all
amounts then due and payable in connection with any Credit,
regardless of whether or not Landlord first pursues Tenant or
exhausts any of its rights or remedies against Tenant, any other
guarantor, others or other Security. Guarantor shall not have any
right of subrogation to the rights of Landlord against any of the
assets of Tenant or any other guarantor of the Lease until after
indefeasible payment in full of the Credit.
7. Continuing
Obligation . This Guaranty shall extend and be applicable to
all renewals, amendments, extensions, consolidations,
modifications, increases and reductions of the Lease Documents and
the Credit. Guarantor’s liability under this Guaranty shall
not be reduced or cancelled by any such action and shall be deemed
modified in accordance with the terms of such action, whether or
not Guarantor has notice of such action.
8. Subordination .
Only during the Effective Period, as herein defined, Guarantor
subordinates to and postpones in favor of the Credit and Security
[a] any present and future debts and obligations of Tenant to
Guarantor (the “Indebtedness”), including, but not
limited to, [i] salary, bonuses and other payments pursuant to
any employment arrangement; [ii] fees, reimbursement of
expenses and other payments pursuant to any independent contractor
arrangement; [iii] principal and interest pursuant to any
Indebtedness; [iv] distributions payable to any shareholders
or general or limited partners of Tenant; and [v] lease
payments pursuant to any leasing arrangement; and [b] any
liens or security interests securing payment of the Indebtedness.
The provisions of this paragraph shall be effective only
[i] after the occurrence of an Event of Default (as defined in
the Lease) a
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