<PAGE> 1
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15 (d) OF THE
SECURITIES AND EXCHANGE ACT OF 1934
DATE OF REPORT (DATE OF EARLIEST EVENT REPORTED) NOVEMBER 12, 1998
OMEGA WORLDWIDE, INC.
-------------------------------------
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
MARYLAND 38-3382537
- --------------------------------------------------------------------------------
(STATE OR OTHER JURISDICTION (COMMISSION (IRS EMPLOYER
OF INCORPORATION FILE NO.) IDENTIFICATION NO.)
900 VICTORS WAY, SUITE 350, ANN ARBOR, MI 48108
- --------------------------------------------------------------------------------
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICERS) ZIP CODE
REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE (734) 887-0200
- --------------------------------------------------------------------------------
905 WEST EISENHOWER CIRCLE, SUITE 101, ANN ARBOR, MI 48103
- --------------------------------------------------------------------------------
(FORMER NAME OR FORMER ADDRESS, IF CHANGED SINCE LAST REPORT.)
<PAGE> 2
Item 5 Other Events
Omega Worldwide, Inc. (the "Company") announced on November 9, 1998 that
Principal Healthcare Finance Trust ("Trust"), a wholly-owned subsidiary of the
Company, had agreed to acquire and lease back thirty nursing homes in the
Australian states of New South Wales, Queensland, Western Australia and Victoria
for A$100 million (approximately $60 million). The transaction is in three
phases. The first phase closed on November 12, 1998, with the purchase by the
Trust of twenty-five properties for a total of A$80 million (approximately $48
million). The purchase of five Victorian homes will occur in the second phase
upon completion of construction and the stabilized occupancy of the homes for an
aggregate purchase price of A$20 million (approximately $12 million). The final
phase involving an additional A$25 million (approximately $15 million), will
encompass renovation and refurbishing during a five-year period ending October
2003 to enable homes to comply with physical plant regulations being
implemented. All disbursements subsequent to the first phase are conditioned
upon various levels of operating profitability and performance.
The properties were purchased from Moran Health Care Group (Australia) Pty
Limited ("Moran"), currently the largest operator of aged care homes in
Australia. Moran currently operates approximately 2,700 licensed aged care beds
and approximately 500 assisted living units.
The transaction was funded by drawing A$50 million (approximately $30 million)
on Principal's A$75 million revolving credit facility with a local bank and by
an interim bridge advance of A$24 million (approximately $14.4 million) provided
by Omega Healthcare Investors, Inc. ("Omega"). The terms of the bank's financing
involved borrowings at rates from 115 to 150 basis points over base rate
(currently at 6.10% to 6.45%) and the payment of a non-use fee and an initial
establishment fee. The Omega loan bears interest at 10% and is due December 31,
1998, or sooner upon completion of local equity financing currently anticipated
to be closed in the Company's first quarter.
The Company intends to reduce its equity investment in the Trust to less than
50% through the sale of units to Australian institutional investors.
The leaseback involves a thirty-year full repairing and maintenance lease
(triple-net) by which Moran pays initial rent of A$7,860,000, with annual
increases equal to changes in the Australian Consumers Price Index, subject to
floor and ceiling.
The Company and subsidiaries provide management services to the Trust, including
day-to-day operations, underwriting, marketing, monitoring and providing capital
markets advice under a seven-year management contract which compensates the
Company at an annual fee equal to 90 basis points, based on invested assets,
together with an incentive management fee if returns exceed targeted thresholds.
Moran is the tenant for all of the Trust's investment real estate assets, which
represent approximately 34% of the total assets at the date of acquisition after
taking into account the Company's proportionate ownership (33.375%) of Principal
Healthcare Finance Limited. After the completion of the equity placement in the
first quarter, Moran will be the tenant for assets which represent approximately
19% of "total assets"
Financial information related to the Company's investment in the Trust and the
related purchase of real estate is attached as Appendix A.
<PAGE> 3
Appendix A
The following tables set forth certain historical unaudited summary financial
information for the Company as adjusted to give effect to the effect to (a) the
contribution to the Company of common stock and subordinated loan of Principal
Healthcare Finance Limited by Omega Healthcare Investors, Inc. on April 2, 1998
and (b) the investment on June 19, 1998 in certain facilities subject to
long-term triple-net leases, and (c) further adjusted on a pro forma basis for
the year ended September 30, 1997 to give effect to the Company's November 12,
1998 acquisition of facilities subject to long-term triple-net leases as if it
had been completed on October 1, 1996.
The pro forma financial information is not necessarily indicative of what the
Company's financial position or results of operations would have been assuming
the above events actually occurred as of the date indicated, nor do they purport
to project the Company's financial position or results of operations at any
future date or for any future period.
OMEGA WORLDWIDE, INC.
CONDENSED CONSOLIDATED PRO FORMA BALANCE SHEET
SEPTEMBER 30, 1997
Unaudited
(In Thousands)
<TABLE>
<CAPTION>
As Pro Forma
Historical Adjusted (A) Adjustment Pro Forma
---------- ------------ ---------- ---------
ASSETS
<S> <C> <C> <C> <C>
Cash $ $ 18,376 (B) $ $ 18,376
Restricted Cash 9,000 (B) 9,000
-------- -------- -------- --------
Total Current Assets 0 27,376 0 27,376
Land and Buildings, subject to triple-net lease 27,778 (C) 48,000 (F) 75,778
Investment in -
Principal Healthcare Finance Limited
Subordinated Loan 23,805 (D) 23,805
Common Stock 5,297 (D) 5,297
Omega (UK) Limited and Other Assets (Net) 150 (D) 150
-------- -------- -------- --------
Total Assets $ 0 $ 84,406 $ 48,000 $132,406
======== ======== ======== ========
LIABILITIES
Non-Interest Bearing Deferred Purchase $ $ 27,778 (C) $ $ 27,778
Obligations
Bridge Loan From Omega Healthcare Investors, Inc. 14,400 (G) 14,400
Warehouse Facility Line of Credit 33,600 (H) 33,600
-------- -------- -------- --------
Total Liabilities 0 27,778 48,000 75,778
SHAREHOLDERS' EQUITY
Preferred Stock 2,600 (E) 2,600
Common Stock 1,225 (E) 1,225
Additional Paid-In Capital 52,803 (E) 52,803
-------- -------- -------- --------
Total Stockholders' Equity 0 56,628 0 56,628
-------- -------- -------- --------
Total Liabilities and Stockholders' Equity $ 0 $ 84,406 $ 48,000 $132,406
======== ======== ======== ========
</TABLE>
<PAGE> 4
(A) Represents balance sheet of Omega Worldwide, Inc. as of September 30,
1997 adjusted to give effect to the transactions described in paragraphs
(B) through (E) below.
(B) Proceeds of $27,376,000 from the issuance of 3,750,000 shares of the
Company to its shareholders at $7.50 per share in connection with the IPO
and rights offering (less offering and registration costs of $750,000),
plus proceeds from initial subscription for 1,000 shares by Omega
Healthcare Investors, Inc., less restricted cash of $9 million which
relates to the acquisition of the Trust described in (C).
(C) Acquisition of the initial investment by the Trust on June 19, 1998,
including its ten aged care homes and four hundred eighty assisted living
units and deferred payment obligation. The Company contributed $3,000,000
in exchange for all of the shares of the Trust. The terms of the purchase
include a deferred acquisition price of $30,000,000 (net amount of
$27,777,800 after imputed interest at an 8% discount rate) payable June
20, 1999. A letter of credit has been drawn for the benefit of the seller
in the amount of $30,000,000 and the Company and Trust have deposited
$9,000,000 with a bank to secure its reimbursement obligation should the
seller seek to collect under the terms of the letter of credit. For
purposes of translation to U.S. dollars, the assumed rate of exchange of
A$.60 to $1 has been used.
(D) Contribution by Omega Healthcare Investors, Inc. of investments in
Principal Healthcare Finance Limited recorded at Omega Healthcare
Investor's carrying value, in exchange for 8,499,000 fully paid common
shares and 260,000 shares of Class B preferred stock of the Company. The
Subordinated Loan earns interest at the rate of 11.83% with annual
increases of 3% each July and is due in December 2000. The common stock
investment represents 33.375% of the outstanding voting stock of
Principal Healthcare Finance Limited. A currency swap arrangement was
entered into in order to hedge the currency risk associated with the
Company's investment in the United Kingdom. The carrying value of the
investment in Principal Healthcare Finance Limited is based on the rate
established in the forward exchange contract, and therefore no amount is
assigned to the swap arrangement.
(E) Exchange of the Company's shares for contributed assets (8,499,000 shares
and 260,000 preferred shares with an aggregate liquidating preference of
$2,600,000) as described in (D) and issuance by the Company of 3,751,000
shares as described in (B).
(F) Represents the acquisition cost of twenty-five aged care homes purchased
on November 12, 1998 by the Trust. The facilities are subject to a
thirty-year master triple-net lease with Moran.
(G) Represents borrowings of A$24 million (approximately $14.4 million) under
bridge loan from Omega Healthcare Investors, Inc. with an interest rate
of 10.0%.
(H) Represents borrowings of A$56 million (approximately $33.6 million) under
revolving credit facility with Bank. Interest rate of currently 6.10%.
<PAGE> 5
OMEGA WORLDWIDE, INC.
CONDENSED CONSOLIDATED PRO FORMA STATEMENT OF OPERATIONS
YEAR ENDED SEPTEMBER 30, 1997
Unaudited
(In Thousands, Except Per Share Amounts)
<TABLE>
<CAPTION>
As Pro Forma
Historical Adjusted (A) Adjustment Pro Forma
---------- ------------ ---------- ---------
Revenues
<S> <C> <C> <C> <C>
Rent Income $ 0 $ 3,925 (B) $ 5,767 (I) $ 9,692
Advisory Fees 1,511 (C) 1,511
Interest Income 2,829 (D) 2,829
------------- ------------ ------------ ------------
Total Revenues 0 8,265 5,767 14,032
Expenses
Imputed Interest 2,223 (B) 2,223
Interest Expense 0 4,203 (J) 4,203
Depreciation 637 (B) 1,013 (K) 1,650
Cost of Services Provided 1,103 (E) 1,103
General and Administrative 480 (F) 480
------------- ------------ ------------ ------------
Total Expenses 0 4,443 5,216 9,659
------------- ------------ ------------ ------------
Earnings Before Equity Earnings and Taxes 0 3,822 551 4,373
Equity In Loss of Principal Healthcare
Finance Limited (339)(G) 0 (339)
------------- ------------ ------------ ------------
Earnings Before Federal and Foreign Income Taxes 0 3,483 551 4,034
Provision For Federal and Foreign Income Taxes (1,320)(H) (187) (1,507)
------------- ------------ ------------ ------------
Earnings Before Preferred Stock Dividends 0 2,163 364 2,527
Preferred Stock Dividends (208) (208)
------------- ------------ ------------ ------------
Net Income Available To Common Stock $ 0 $ 1,955 $ 364 $ 2,319
============= ============ ============ ============
Common Shares Outstanding - Basic 12,250
------------
Net Income Per Share - Basic $ 0.19
============
</TABLE>
<PAGE> 6
(A) Represents statement of operations of Omega Worldwide, Inc. for the year
ended September 30, 1997 adjusted to give effect to the transactions
described in paragraphs (B) through (H) below.
(B) Revenues and expenses related to the investment made on June 19, 1998 in
certain aged care facilities which are subject to long-term triple-net
leases. The 30 year lease provides an option to purchase by tenant at the
end of 14 years. Rent payments of $3,000,000 commence on July 1, 1999,
with minimum annual increases of 2% commencing on July 1, 2000. Income is
recognized on a straight-line basis. The purchase option is generally at
fair market value determined by a formula related to annual rents.
Imputed interest on the deferred obligation of the Company is recognized
at 8%. Depreciation of the buildings and equipment is recognized over 40
to 50 year periods. For purposes of translation to U.S. dollars, the
assumed rate of exchange of A$.60 to $1 has been used.
The Trust's activities have been consolidated with the Company as the
Company presently owns 100% of the voting units in the Trust. The Trust
is seeking other investors to reduce the Company's interest in the Trust
to 50% or less, at which time earnings from the investment will be
accounted for using the equity method.
(C) The Company's fees pursuant to Management Agreement equal to 90 basis
point of the aggregate book value of invested assets.
(D) Interest income on the subordinated loan to Principal Healthcare Finance
Limited bears interest of 11.8% and increases 3% each July.
(E) Historical costs of services provided by Omega (UK) Limited for the year
ended September 30, 1997. Omega (UK) Limited is the primary service
provider for activities related to Principal Healthcare Finance Limited.
The reported amount represents direct costs incurred in the delivery of
the services for which fee income has been recognized.
(F) Comprises allocated share of costs of Omega Healthcare Investors, Inc.
pursuant to the provisions of a Service Agreement between Omega
Healthcare Investors, Inc. and the Company. Indirect costs incurred by
Omega Healthcare Investors, Inc. for the year ended September 30, 1997
are allocated based on the relationship of assets under the Company's
management to the combined total of those assets and Omega Healthcare
Investors' assets.
The Company's direct administrative costs, including the costs the
Company expects it will incur on its own behalf for state taxes, investor
relations, legal and accounting and similar items, are estimated to be
approximately $650,000 to $700,000. Additionally, general and
administrative costs expected to be incurred by the Trust are estimated
to be approximately $350,000 to $400,000. These amounts are not factually
supportable and therefore have been omitted.
(G) The Company's share (33.375%) of loss of Principal Healthcare Finance
Limited for the fiscal year ended August 31, 1997 plus amortization of
$101,000 related to the excess of the carrying value of its investment
over its proportionate share of Principal Healthcare Finance Limited's
underlying equity. The carrying value of the investment in common stock
of Principal Healthcare Finance Limited exceeds the Company's
proportionate share of Principal Healthcare Finance Limited's equity by
approximately $1 million. The Company will amortize this amount over 10
years.
(H) There are no corporate income taxes in the State of Michigan.
(I) Represents rental income from investments made by the Trust on November
12, 1998 in certain aged care homes subject to long-term triple-net
leases. The thirty year triple-net lease provides for an option to
purchase be tenant at the end of 14 years. Initial annual rent payments
of A$7,680,000 (approximately $4,585,000) commenced at November 12, 1998
with minimum increases of 1.5% commencing an July 1 of each lese year.
The purchase option is generally at fair market value determined by a
formula tied to a multiple of annual rent.
<PAGE> 7
(J) Represents interest expense on the bridge loan from Omega Healthcare
Investors, Inc. at 10%. The bridge loan is expected to be repaid from
proceeds of the issuance of subordinated debt beginning interest at 10%.
Also includes interest expense on revolving facility with Bank. Initial
six months interest rate is 6.10% and interest rate thereafter assumed to
be the base rate plus 1.50% or approximately 6.45%. Also included are a
non-use fee equal to .25% for the undrawn balance of the facility and the
establishment fee paid to the Bank.
(K) Depreciation of the buildings is recognized over 40 to 50 year periods.
<PAGE> 8
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
OMEGA WORLDWIDE, INC.
November 27, 1998 By /s/ David A. Stover
------------------------------------
David A. Stover,
Chief Financial Officer
<PAGE> 9
Exhibit Index
Exhibit 10.1 Form of transaction documents comprising agreements by
and among Omega Worldwide, Inc. (the "Company"), Principal
Healthcare Finance Trust (the "Trust"), Principal Healthcare
Finance Pty Limited ("Principal Pty"), Moran Health Care
(Australia) Pty Limited ("Moran Australia"), Moran Health Care
Group Pty Limited ("Moran"), Pender Bros Pty Limited
("Pender"), ABN AMRO Australia Limited ("ABN Australia"), ABN
AMRO Bank N.V. ("ABN Bank") and ABN AMRO Facilities Australia
Limited ("ABN Facilities"), as set forth in the agreements
described as follows: QLD, NSW and WA Lease between Principal
Pty, as lessor, and Moran Australia, as lessee; Capital
Contribution Agreement among Moran Australia, Moran and
Principal Pty; Agreement for Lease among Principal Pty, Moran
Australia and Moran; Relationship Agreement among Principal
Pty, Moran Australia, Peter Anna Pty Limited, Moran Health
Care Group (WA) Pty Limited and Moran; Lease Guarantee
executed by Moran; Deed of Fixed and Floating Charge between
Pender and Principal Pty; Deed of Guarantee and Indemnity
between Pender and Principal Pty; Mortgage executed by Pender;
Warehouse Facility Agreement among Principal Pty, ABN
Australia, ABN Bank and ABN Facilities; Deed of Guarantee and
Indemnity between the Company, ABN Australia and ABN Bank;
Debenture Stock Trust Deed between Principal Pty and ABN
Facilities; Deed of Charge (NSW and Vic) between Principal Pty
and ABN Facilities; Deed of Charge (QLD) between Principal Pty
and ABN Facilities; Deed of Charge (WA) between Principal Pty
and ABN Facilities; and Tripartite Agreement between PHF No. 1
Pty Limited and Tanoa Pty Limited, Principal Pty, ABN
Australia, ABN Bank and ABN Facilities
Exhibit 10.2 Advisory Agreement between Omega (Australia) Pty Limited
and Principal Pty
Exhibit 10.3 Promissory Note executed by the Trust to Omega Healthcare
Investors, Inc. ("Omega") and Guaranty executed by the Company
in favor of Omega
<PAGE> 1
EXHIBIT 10.1
PRINCIPAL HEALTHCARE FINANCE PTY
LIMITED
("LESSOR")
MORAN HEALTH CARE (AUSTRALIA) PTY
LIMITED
("LESSEE")
QLD, NSW AND WA LEASE
[PHILLIPS FOX LAWYERS LOGO]
255 Elizabeth Street Sydney NSW 2000 Australia
Tel +61 2 9286 8000 Fax +61 2 9283 4144 DX 107 SYDNEY
Email: [email protected] WWW site:
http://www.PhillipsFox.com.au
<PAGE> 2
CONTENTS
<TABLE>
<S> <C>
PART 1. THE SUBJECT MATTER AND TERM OF THIS LEASE.......................................................
PART 2. DEFINITIONS AND INTERPRETATION..................................................................
PART 3. LESSEE'S FINANCIAL OBLIGATIONS..................................................................
PART 4. OUTGOINGS.......................................................................................
PART 5. CONTINUANCE OF TERM.............................................................................
PART 6. OWNERSHIP ISSUES................................................................................
PART 7. CONDITION OF LEASED PROPERTY USE AND ENVIRONMENTAL MATTERS......................................
PART 8. FINANCIAL COVENANTS.............................................................................
PART 9. MAINTENANCE AND REPAIR..........................................................................
PART 10. ALTERATIONS AND ADDITIONS........................................................................
PART 11. ENCUMBRANCES.....................................................................................
PART 12. PERMITTED CONTESTS...............................................................................
PART 13. INSURANCE........................................................................................
PART 14. INSURANCE PROCEEDS...............................................................................
PART 15. COMPULSORY ACQUISITION...........................................................................
PART 16. EVENTS OF DEFAULT................................................................................
PART 17. LESSOR'S RIGHT TO REMEDY LESSEES DEFAULT.........................................................
PART 18. LESSEE'S OPTION TO PURCHASE LEASED PROPERTY......................................................
PART 19. INDEMNITY........................................................................................
PART 20. LESSEE'S CERTIFICATE.............................................................................
PART 21. RISK OF LOSS.....................................................................................
PART 22. INDEMNITIES AND WAIVER OF WARRANTIES.............................................................
PART 23. SUBLETTING AND ASSIGNMENT........................................................................
PART 24. OFFICERS CERTIFICATES, FINANCIAL STATEMENTS......................................................
PART 25. LESSOR'S RIGHT TO INSPECT........................................................................
PART 26. NO WAIVER........................................................................................
PART 27. REMEDIES CUMULATIVE..............................................................................
PART 28. ACCEPTANCE OF SURRENDER..........................................................................
PART 29. NO MERGER OF TITLE, NO PARTNERSHIP...............................................................
PART 30. QUIET ENJOYMENT & ADDITIONAL RIGHTS..............................................................
</TABLE>
<PAGE> 3
<TABLE>
<S> <C>
PART 31. NOTICES......................................................................................
PART 32. INTERPRETATION...............................................................................
PART 33. RENT ADJUSTMENT..............................................................................
PART 34. BREACH BY LESSOR.............................................................................
PART 35. FACILITY MORTGAGEE CONSENT...................................................................
PART 36. EXPERT DETERMINATION.........................................................................
PART 37. MISCELLANEOUS................................................................................
PART 38. COMMISSIONS..................................................................................
PART 39. GST..........................................................................................
PART 40. LESSOR'S OPTION TO ACQUIRE BUSINESS ASSETS...................................................
PART 41. ESSENTIAL TERMS..............................................................................
PART 42. FIRST RIGHT OF REFUSAL TO LEASE..............................................................
PART 43. POWER OF ATTORNEY............................................................................
PART 44. ESSENTIAL LEGISLATION........................................................................
PART 45. LIMITATION OF LIABILITY......................................................................
PART 46. YEAR 15 OPTION...............................................................................
</TABLE>
<PAGE> 4
1. THE SUBJECT MATTER AND TERM OF THIS LEASE
LEASED PROPERTY AND TERM
The Lessor leases the Leased Property to the Lessee for the Term at the
Rent and otherwise on the terms and conditions set out in this Lease.
2. DEFINITIONS AND INTERPRETATION
2.1. DEFINITIONS
Words commencing with a capital letter shall have the meanings given in
the Dictionary.
2.2. INTERPRETATION
For all purposes of this Lease:
2.2.1. WORDS EXPRESSED IN THE SINGULAR INCLUDE THE PLURAL AND VICE
VERSA;
2.2.2. ALL ACCOUNTING TERMS NOT OTHERWISE DEFINED IN THIS LEASE HAVE
THE MEANINGS ASSIGNED TO THEM IN ACCORDANCE WITH AUSTRALIAN
GAAP;
2.2.3. ANY COVENANT IN THIS LEASE BY THE LESSEE NOT TO DO AN ACT OR
THING SHALL BE DEEMED TO INCLUDE AN OBLIGATION NOT TO PERMIT
OR SUFFER SUCH ACT OR THING TO BE DONE;
2.2.4. REFERENCE TO THE REQUIREMENT OF ANY CONSENT AND/OR APPROVAL
FROM THE LESSOR SHALL BE DEEMED TO INCLUDE A REQUIREMENT FOR
THE CONSENT AND/OR APPROVAL OF ANY FACILITY MORTGAGEE;
2.2.5. ALL REFERENCES IN THIS LEASE TO ANY STATUTE OR ACT OF
PARLIAMENT OR STATUTORY INSTRUMENT SHALL INCLUDE EVERY STATUTE
OR ACT OF PARLIAMENT OR STATUTORY INSTRUMENT NOW OR IN THE
FUTURE ENACTED AND EVERY INSTRUMENT,
<PAGE> 5
REGULATION AND BY-LAW AND EVERY ORDER, NOTICE OR DIRECTION AND
EVERY LICENCE, CONSENT OR PERMISSION MADE OR GIVEN UNDER ANY
OF THEM AND ANY REFERENCE TO AN ACT OF PARLIAMENT SHALL
INCLUDE ANY AMENDMENT EXTENSION OR REENACTMENT FOR THE TIME
BEING IN FORCE;
2.2.6. COVENANTS AND POWERS IMPLIED BY STATUTE ARE EXCLUDED FROM THIS
LEASE, UNLESS ANY SUCH COVENANT OR POWER CANNOT BE EXCLUDED BY
FORCE OR STATUTE OR IS EXPRESSLY INCORPORATED IN THIS LEASE;
2.2.7. DEFINITIONS AND INTERPRETATION SHALL APPLY EXCEPT AS OTHERWISE
EXPRESSLY PROVIDED OR UNLESS THE CONTEXT OTHERWISE REQUIRES.
3. LESSEE'S FINANCIAL OBLIGATIONS
RENT
3.1. THE LESSEE COVENANTS TO PAY THE RENT TO THE LESSOR DURING THE TERM BY
DIRECT DEBIT TO WHICHEVER BANK ACCOUNT THE LESSOR DIRECTS IN ADVANCE IN
EQUAL, CONSECUTIVE MONTHLY INSTALMENTS ON THE FIRST DAY OF EACH
CALENDAR MONTH OR TO SUCH OTHER PERSONS, FIRMS OR CORPORATIONS OR IN
SUCH OTHER MANNER AS THE LESSOR FROM TIME TO TIME MAY DESIGNATE IN A
NOTICE AS FOLLOWS:
3.1.1. IF THE LESSOR DIRECTS THE LESSEE TO PAY ANY RENT TO ANY PARTY
OTHER THAN THE LESSOR, THE LESSEE SHALL SEND TO THE LESSOR,
SIMULTANEOUSLY WITH SUCH PAYMENT, A COPY OF THE TRANSMITTAL
LETTER OR INVOICE AND THE CHEQUE WHEREBY SUCH PAYMENT IS MADE
OR SUCH OTHER EVIDENCE OF PAYMENT AS THE LESSOR MAY REASONABLY
REQUIRE. THE FIRST MONTHLY PAYMENT OF RENT, IN RESPECT OF THE
PERIOD COMMENCING ON (AND INCLUDING) THE DATE OF THIS LEASE,
SHALL BE PAYABLE ON THE DATE OF THIS LEASE. RENT AND
ADDITIONAL CHARGES SHALL BE PRORATED AS TO ANY PARTIAL MONTHS
AT THE BEGINNING AND END OF THE TERM.
<PAGE> 6
3.1.2. THE RENT FOR EACH LEASE YEAR BEGINNING WITH THE LEASE YEAR
COMMENCING 1 JULY 1999 SHALL AT THE COMMENCEMENT OF EACH SUCH
LEASE YEAR BE INCREASED BY THE GREATER OF:
3.1.2.1. such percentage as equals the percentage by which the
Consumer Price Index published on the last published
date before commencement of that Lease Year exceeds
the corresponding Consumer Price Index published on
the last published date before commencement of the
immediately preceding Lease Year PROVIDED THAT the
increase in Rent attributable to an increase in the
Consumer Price Index in each Lease Year shall not be
less than 1.5% and no more than 6% greater than the
Rent payable in the immediately preceding Lease Year;
and
(I) 6% of the increase (if any) of Turnover from
the expiration of the Turnover Period
expiring before the commencement of the
Lease Year immediately preceding the Lease
Year for which the Rent is being reviewed to
the expiration of the Turnover Period
expiring immediately before the Lease Year
for which the Rent is being reviewed; and
(II) in the case of the Turnover Period for the
period from the date of this Lease to 30
June 1999, 6% of the increase (if any) of
Turnover from the expiration of the period
of 12 months expiring on the date
immediately before the grant of this Lease
and the period from and including the date
of this Lease to and including 30 June 1999
multiplied by 365 and divided by the number
of days from and including the date of this
Lease to and including 30 June 1999.
3.1.3. TO RESULT IN AN INCREASE IN RENT, THE INCREASE IN TURNOVER
REFERRED TO IN CLAUSE 3.1(B)(II) MUST ARISE AS A RESULT OF A
CHANGE IN THE LESSEE'S BUSINESS CARRIED OUT AT THE LEASED
PROPERTY.
<PAGE> 7
NO REDUCTION
3.2. NO ADJUSTMENT UNDER THIS PART 3 SHALL REDUCE THE RENT BELOW THE RENT
RESERVED FOR THE LEASE YEAR IMMEDIATELY PRECEDING THE LEASE YEAR FOR
WHICH SUCH INCREASE IS BEING CALCULATED AND ANY ADJUSTMENTS TO RENT
SHALL BE UPWARDS ONLY.
ADDITIONAL CHARGES
3.3. IN ADDITION TO THE RENT, THE LESSEE WILL ALSO PAY WHEN DUE ALL
ADDITIONAL CHARGES.
LATE CHARGES
3.4. IF THE LESSEE DOES NOT PAY ANY INSTALMENT OF RENT BY THE DUE DATE
(WHETHER FORMALLY DEMANDED OR NOT) THEN, WITHOUT PREJUDICE TO ANY OTHER
RIGHT OR REMEDY AVAILABLE TO THE LESSOR, THE LESSEE SHALL PAY THE
LESSOR ON DEMAND, AS AN ADDITIONAL CHARGE, INTEREST AT THE OVERDUE RATE
FROM THE DATE DUE TO THE DATE PAID IN FULL COMPOUNDED MONTHLY.
NET LEASE
3.5. THE RENT SHALL BE PAID ABSOLUTELY AND UNCONDITIONALLY TO THE LESSOR, SO
THAT THIS LEASE SHALL YIELD TO THE LESSOR THE FULL AMOUNT OF THE
INSTALMENTS OF RENT AND ADDITIONAL CHARGES (TO THE EXTENT THE LATTER
ARE OWED TO THE LESSOR) (SUBJECT ONLY TO THE LESSEE'S OBLIGATIONS TO
DEDUCT WITHHOLDING TAX IF PROPERLY REQUIRED TO DO SO BY LAW) THROUGHOUT
THE TERM, AND SUBJECT TO ANY OTHER PROVISIONS OF THIS LEASE WHICH
EXPRESSLY PROVIDE FOR ADJUSTMENT OR ABATEMENT OF RENT OR OTHER CHARGES.
THE COVENANTS TO PAY RENT AND OTHER AMOUNTS UNDER THIS LEASE ARE
INDEPENDENT COVENANTS, AND THE LESSEE SHALL HAVE NO RIGHT TO HOLD BACK,
SET OFF OR FAIL TO PAY ANY SUCH AMOUNTS FOR DEFAULT BY THE LESSOR OR
ANY OTHER REASON WHATSOEVER.
3.6. THE LESSEE HEREBY ASSUMES THE FULL AND SOLE RESPONSIBILITY FOR THE
CONDITION, OPERATION, REPAIR, ALTERATION, IMPROVEMENT, REPLACEMENT,
<PAGE> 8
MAINTENANCE, REMEDIATION AND MANAGEMENT OF THE LEASED PROPERTY. THE
LESSOR SHALL NOT BE RESPONSIBLE FOR ANY LOSS OR DAMAGE TO ANY PROPERTY
OF THE LESSEE OR ANY SUBTENANT, LICENSEE, CONCESSIONAIRE, OR OTHER USER
OR OCCUPANT OF ANY PART OF THE LEASED PROPERTY. THE LESSEE SHALL PAY
ALL COSTS, EXPENSES, PENALTIES, FINES, CLAIMS, DAMAGES AND CHARGES
ARISING OUT OF ITS USE, OCCUPANCY AND OPERATION OF THE LEASED PROPERTY.
THE LESSOR IS NOT REQUIRED TO FURNISH ANY SERVICES WHATSOEVER TO THE
LEASED PROPERTY, OR (UNLESS OTHERWISE SPECIFICALLY AND EXPRESSLY AGREED
OR PROVIDED IN THIS LEASE) MAKE ANY PAYMENT OF ANY KIND WHATSOEVER.
LIMITATION ON COUNTERCLAIM
3.7. IF THE LESSOR COMMENCES ANY PROCEEDINGS FOR NONPAYMENT OF RENT, THE
LESSEE WILL NOT MAKE ANY COUNTERCLAIM OR CROSS COMPLAINT OR REDUCTION
OR SET OFF OR ABATEMENT OR SIMILAR PLEADING OF ANY NATURE OR
DESCRIPTION IN SUCH PROCEEDINGS. THIS SHALL NOT BE CONSTRUED AS A
WAIVER OF THE LESSEE'S RIGHTS TO ASSERT SUCH CLAIMS IN A SEPARATE
ACTION BROUGHT BY THE LESSEE.
STAMP DUTY
3.8. THE LESSEE SHALL PAY ALL STAMP DUTY AND REGISTRATION FEES PAYABLE IN
CONNECTION WITH THIS LEASE.
GROSSING UP
3.9. IF AT ANY TIME ANY APPLICABLE LAW REQUIRES THE LESSOR OR THE LESSEE TO
MAKE ANY DEDUCTION OR WITHHOLDING IN RESPECT OF TAXES FROM ANY PAYMENT
UNDER THIS LEASE TO THE LESSOR, THE LESSEE SHALL PAY THE LESSOR, AT THE
TIME THAT PAYMENT IS DUE, SUCH ADDITIONAL AMOUNTS AS ARE NECESSARY TO
ENSURE THAT, AFTER THE MAKING OF THAT DEDUCTION OR WITHHOLDING, THE
LESSOR, RECEIVES A NET SUM EQUAL TO THE SUM WHICH IT WOULD HAVE
RECEIVED HAD NO SUCH DEDUCTION OR WITHHOLDING BEEN MADE, AND THE LESSEE
SHALL INDEMNIFY THE LESSOR, AGAINST ANY LOSSES OR COSTS INCURRED BY THE
LESSOR, BY REASON OF ANY FAILURE OF THE LESSEE TO MAKE ANY SUCH
DEDUCTION OR WITHHOLDING. THE LESSEE SHALL PROMPTLY
<PAGE> 9
DELIVER TO THE LESSOR, COPIES OF ANY RECEIPTS, CERTIFICATES OR OTHER
PROOF EVIDENCING THE AMOUNTS (IF ANY) PAID OR PAYABLE IN RESPECT OF ANY
SUCH DEDUCTION OR WITHHOLDING.
4. OUTGOINGS
PAYMENT OF OUTGOINGS
4.1. SUBJECT TO PART 12, THE LESSEE WILL PAY, OR CAUSE TO BE PAID, ALL
OUTGOINGS BEFORE ANY FINE, PENALTY, INTEREST OR COST FOR NONPAYMENT
BECOMES DUE AND PAYABLE, SUCH PAYMENTS TO BE MADE DIRECTLY TO THE
RELEVANT TAXING AUTHORITIES WHERE FEASIBLE, AND WILL PROMPTLY, UPON
REASONABLE REQUEST, FURNISH TO THE LESSOR COPIES OF OFFICIAL RECEIPTS
OR OTHER PROOF EVIDENCING SUCH PAYMENTS. IF ANY SUCH OUTGOINGS MAY BE
PAID IN INSTALMENTS (WHETHER OR NOT INTEREST SHALL ACCRUE ON THE UNPAID
BALANCE OF SUCH OUTGOINGS), THE LESSEE MAY PAY THE SAME (AND ANY
ACCRUED INTEREST ON THE UNPAID BALANCE OF SUCH OUTGOING) IN INSTALMENTS
AND IN SUCH EVENT, SHALL PAY SUCH INSTALMENTS DURING THE TERM AS THE
SAME RESPECTIVELY BECOME DUE AND BEFORE FINE, PENALTY, PREMIUM, FURTHER
INTEREST OR COST BECOME DUE AND PAYABLE.
FILE RETURNS
4.2. THE LESSOR, AT ITS EXPENSE, SHALL, TO THE EXTENT REQUIRED OR PERMITTED
BY APPLICABLE LAW AND REGULATIONS, PREPARE AND FILE ALL TAX RETURNS AND
REPORTS AS MAY BE REQUIRED BY GOVERNMENTAL OR LOCAL AUTHORITIES OR
OTHERWISE IN RESPECT OF THE LESSOR'S INCOME, GROSS RECEIPTS, SALES
RENT, GST AND CAPITAL TAXES. THE LESSEE, AT ITS EXPENSE, SHALL, TO THE
EXTENT REQUIRED OR PERMITTED BY APPLICABLE LAWS AND REGULATIONS,
PREPARE AND FILE ALL OTHER TAX RETURNS AND REPORTS IN RESPECT OF ANY
OUTGOINGS AS MAY BE REQUIRED BY GOVERNMENTAL OR LOCAL AUTHORITIES OR
OTHERWISE.
REFUNDS
4.3. IF ANY REFUND DUE TO THE LESSEE FROM ANY TAXING AUTHORITY IN RESPECT OF
<PAGE> 10
ANY OUTGOINGS PAID BY THE LESSEE IS PAID TO THE LESSOR BY SUCH
AUTHORITY, THE SAME SHALL BE PAID TO THE LESSEE IF NO EVENT OF DEFAULT
HAS OCCURRED UNDER THIS LEASE WHICH HAS NOT BEEN REMEDIED. ANY SUCH
FUNDS RETAINED BY OR REMITTED TO THE LESSOR DUE TO AN EVENT OF DEFAULT
SHALL BE APPLIED AS PROVIDED IN PART 16.
APPEALS
4.4. THE LESSOR AND THE LESSEE SHALL, UPON REQUEST OF THE OTHER, PROVIDE
SUCH DATA AS IS MAINTAINED BY THE PARTY TO WHOM THE REQUEST IS MADE
WITH RESPECT TO THE LEASED PROPERTY AS MAY BE NECESSARY TO PREPARE ANY
REQUIRED RETURNS AND REPORTS. THE LESSEE MAY, UPON NOTICE TO THE
LESSOR, AT THE LESSEE'S SOLE COST AND EXPENSE, PROTEST, APPEAL, OR
INSTITUTE SUCH OTHER PROCEEDINGS AS THE LESSEE MAY DEEM APPROPRIATE TO
EFFECT A REDUCTION OF OUTGOINGS AND THE LESSOR, AT THE LESSEE'S
EXPENSE, SHALL COOPERATE WITH THE LESSEE IN SUCH PROTEST, APPEAL, OR
OTHER ACTION. IN ANY SUCH PROCEEDING BROUGHT BY THE LESSOR, THE LESSEE
SHALL COOPERATE WITH THE LESSOR AT THE LESSEE'S SOLE COST AND EXPENSE.
THE LESSEE SHALL REIMBURSE THE LESSOR FOR THE LESSOR'S REASONABLE COSTS
OF COOPERATING WITH THE LESSEE FOR SUCH PROTEST, APPEAL OR OTHER
ACTION.
NOTICE TO LESSEE
4.5. THE LESSOR SHALL GIVE PROMPT NOTICE TO THE LESSEE OF ALL OUTGOINGS
PAYABLE BY THE LESSEE UNDER THIS LEASE OF WHICH THE LESSOR AT ANY TIME
HAS KNOWLEDGE, BUT THE LESSOR'S FAILURE TO GIVE ANY SUCH NOTICE SHALL
IN NO WAY DIMINISH THE LESSEE'S OBLIGATIONS UNDER THIS LEASE TO PAY
SUCH OUTGOINGS, BUT SUCH FAILURE SHALL OBVIATE ANY DEFAULT UNDER THIS
LEASE FOR A REASONABLE TIME AFTER THE LESSEE RECEIVES NOTICE OF ANY
OUTGOING WHICH IT IS OBLIGED TO PAY.
ADJUSTMENT
4.6. OUTGOINGS IMPOSED IN RESPECT OF THE TAX-FISCAL PERIOD DURING WHICH THE
TERM TERMINATED (OTHER THAN OUTGOINGS IMPOSED ON THE LESSEE FOR WHICH
THE LESSEE IS LAWFULLY RESPONSIBLE) SHALL BE ADJUSTED AND
<PAGE> 11
PRORATED BETWEEN THE LESSOR AND THE LESSEE, WHETHER OR NOT SUCH
OUTGOING IS IMPOSED BEFORE OR AFTER TERMINATION, AND THE OBLIGATIONS OF
EACH PARTY TO PAY ITS PRORATED SHARE AFTER TERMINATION SHALL SURVIVE
SUCH TERMINATION.
UTILITY CHARGES
4.7. THE LESSEE WILL PAY OR CAUSE TO BE PAID WHEN DUE ALL CHARGES FOR
ELECTRICITY, POWER, GAS, OIL, WATER, TELECOMMUNICATIONS AND OTHER
UTILITIES USED IN THE LEASED PROPERTY DURING THE TERM.
INSURANCE PREMIUMS
4.8. THE LESSEE WILL PAY OR CAUSE TO BE PAID WHEN DUE ALL PREMIUMS FOR THE
INSURANCE REQUIRED TO BE MAINTAINED UNDER PART 13 DURING THE TERM.
5. CONTINUANCE OF TERM
NO TERMINATION, ABATEMENT ETC
5.1. THE LESSEE SHALL REMAIN BOUND BY THIS LEASE IN ACCORDANCE WITH ITS
TERMS AND SHALL NOT TAKE ANY ACTION WITHOUT THE CONSENT OF THE LESSOR
TO MODIFY, SURRENDER OR TERMINATE THE SAME, AND SHALL NOT SEEK OR BE
ENTITLED TO ANY ABATEMENT (EXCEPT WHERE ABATEMENT IS EXPRESSLY PROVIDED
FOR ELSEWHERE IN THIS LEASE), DEDUCTION, DEFERMENT OR REDUCTION OF
RENT, OR SET OFF OR COUNTERCLAIM OR ANY OTHER DEFENCE OR RIGHT OR CLAIM
AGAINST THE RENT.
PARTIES REMAIN BOUND
5.2. THE RESPECTIVE OBLIGATIONS OF THE LESSOR AND THE LESSEE SHALL NOT BE
AFFECTED BY REASON OF ANYTHING INCLUDING WITHOUT LIMITATION:
5.2.1. ANY DAMAGE TO, OR DESTRUCTION OF, THE LEASED PROPERTY OR ANY
PORTION OF THE LEASED PROPERTY FROM WHATEVER CAUSE OTHER THAN
ANY TAKING OF THE LEASED PROPERTY OR ANY PORTION OF THE LEASED
PROPERTY;
<PAGE> 12
5.2.2. THE LAWFUL OR (EXCEPT IN THE CASE OF THE LESSOR) UNLAWFUL
PROHIBITION OF, OR RESTRICTION UPON, THE LESSEE'S USE OR
POSSESSION OF THE LEASED PROPERTY, OR ANY PORTION OF THE
LEASED PROPERTY, THE INTERFERENCE WITH SUCH USE BY ANY PERSON
OTHER THAN THE LESSOR;
5.2.3. IF THE EXCLUDED PERSONAL PROPERTY OR ANY PORTION OF THE
EXCLUDED PERSONAL PROPERTY IS REMOVED FROM THE LEASED PROPERTY
BY ITS TRUE OWNER OR ANY THIRD PARTY AND/OR THE TRUE OWNER OR
ANY THIRD PARTY CLAIMS ANY RIGHTS IN THE EXCLUDED PERSONAL
PROPERTY OR ANY PORTION OF THE EXCLUDED PERSONAL PROPERTY
AND/OR INTERFERES WITH OR RESTRICTS OR PREVENTS THE USE OF THE
EXCLUDED PERSONAL PROPERTY OR ANY PORTION OF THE EXCLUDED
PERSONAL PROPERTY AND/OR CLAIMS OR OBTAINS COSTS, LOSSES OR
DAMAGES AS A RESULT OF THE USE OF THE EXCLUDED PERSONAL
PROPERTY OR ANY PORTION OF THE EXCLUDED PERSONAL PROPERTY BY
THE LESSEE
5.2.4. ANY CLAIM WHICH THE LESSEE HAS OR MIGHT HAVE AGAINST THE
LESSOR OR BY REASON OF ANY DEFAULT OR BREACH OF ANY WARRANTY
BY THE LESSOR;
5.2.5. ANY BANKRUPTCY, INSOLVENCY, REORGANISATION, COMPOSITION,
READJUSTMENT, LIQUIDATION, DISSOLUTION, WINDING-UP,
MORATORIUM, ADMINISTRATION OR OTHER PROCEEDINGS AFFECTING THE
LESSOR;
5.2.6. ANY DEFECT (INCLUDING ANY STRUCTURAL DEFECT) IN OR FAILURE OF
THE LEASED PROPERTY ITS CONDITION, DESIGN, COMPLIANCE WITH
SPECIFICATIONS, OPERATION OR FITNESS FOR USE;
5.2.7. ANY INTERFERENCE, INTERRUPTION, RESTRICTION, CURTAILMENT OR
CESSATION IN THE USE OR POSSESSION OF THE LEASED PROPERTY OR
ANY PART OF THE LEASED PROPERTY FOR ANY REASON WHATSOEVER OF
WHATEVER DURATION AND INCLUDING (BUT NOT LIMITED TO) THE
OCCURRENCE OF ANY SEIZURE MATTER AND DAMAGE TO OR DESTRUCTION
OF THE LEASED PROPERTY;
<PAGE> 13
5.2.8. THE INVALIDITY OR UNENFORCEABILITY OF ANY PART OF THIS LEASE;
5.2.9. ANY EVENT OF FORCE MAJEURE FRUSTRATION OR UNENFORCEABILITY IN
WHOLE OR IN PART OF THIS LEASE;
5.2.10. ANY DEFECT IN TITLE OR ANY BREACH OF OBLIGATIONS OF ANY PARTY
THERETO OR ANY CLAIM BY TITLE PARAMOUNT;
5.2.11. ANY FAILURE BY THE LESSOR OR ANY OTHER PERSON TO PERFORM ANY
OF ITS OBLIGATIONS UNDER THIS LEASE OR OTHERWISE TO THE LESSEE
OR ANY OTHER PERSON;
5.2.12. ANY EVENT WHICH MIGHT BUT FOR THIS CLAUSE HAVE EFFECT TO
FRUSTRATE THIS LEASE; OR
5.2.13. FOR ANY OTHER CAUSE WHETHER SIMILAR OR DISSIMILAR TO ANY OF
THE FOREGOING.
WAIVER OF RIGHTS BY LESSEE
5.3. THE LESSEE HEREBY SPECIFICALLY WAIVES ALL RIGHTS ARISING FROM ANY
OCCURRENCE WHATSOEVER WHICH MAY NOW OR IN THE FUTURE BE CONFERRED UPON
IT BY LAW TO:
5.3.1. MODIFY, SURRENDER, CANCEL OR TERMINATE THIS LEASE OR QUIT OR
SURRENDER, THE LEASED PROPERTY OR ANY PORTION THEREOF; OR
5.3.2. ENTITLE THE LESSEE TO ANY DIMINUTION, CESSATION, ABATEMENT,
REDUCTION, SUSPENSION OR DEFERMENT OF THE RENT OR OTHER SUMS
PAYABLE BY THE LESSEE UNDER THIS LEASE;
except as otherwise specifically provided in this Lease.
RENT ETC TO CONTINUE
5.4. THE OBLIGATIONS OF THE LESSOR AND THE LESSEE UNDER THIS LEASE SHALL BE
SEPARATE AND INDEPENDENT COVENANTS AND AGREEMENTS AND THE RENT AND
<PAGE> 14
ALL OTHER SUMS PAYABLE BY THE LESSEE UNDER THIS LEASE SHALL CONTINUE TO
BE PAYABLE IN ALL EVENTS UNLESS THE OBLIGATIONS TO PAY THE SAME ARE
TERMINATED UNDER THE EXPRESS PROVISIONS OF THIS LEASE OR BY TERMINATION
OF THIS LEASE UNDER PART 16.
LESSEE'S COST
5.5. ALL COVENANTS, AGREEMENTS AND UNDERTAKINGS OF THE LESSEE UNDER THIS
LEASE SHALL BE PERFORMED AT THE LESSEE'S OWN COST, EXPENSE AND RISK
UNLESS EXPRESSLY STATED OTHERWISE.
RENT PAYMENT FINAL
5.6. EACH PAYMENT OF RENT MADE BY THE LESSEE SHALL BE FINAL AND THE LESSEE
WILL NOT SEEK OR HAVE ANY RIGHT TO RECOVER, CLAIM OR RECOUP ALL OR ANY
PART OF SUCH PAYMENT FROM THE LESSOR OR ANY OTHER PERSON EXCEPT IN
RELATION TO PAYMENTS MADE IN ERROR.
WITHHOLDING TAX
5.7. IF THE LESSEE SHALL BE LEGALLY OBLIGED TO WITHHOLD TAX FROM ANY PAYMENT
DUE TO THE LESSOR FROM THE LESSEE UNDER THIS LEASE THE LESSEE SHALL
WITHHOLD THE MINIMUM PERMISSIBLE AMOUNT BUT SHALL OTHERWISE COMPLY WITH
ALL COVENANTS UNDER THIS LEASE INCLUDING THE COVENANT TO PAY RENT.
6. OWNERSHIP ISSUES
LESSEE'S ACKNOWLEDGMENT
6.1. THE LESSEE ACKNOWLEDGES THAT THE LESSOR IS THE REGISTERED PROPRIETOR OF
THE LAND AND THAT THE LESSEE HAS ONLY THE RIGHT TO THE SOLE AND
EXCLUSIVE POSSESSION AND USE OF THE LEASED PROPERTY UPON THE TERMS AND
CONDITIONS OF THIS LEASE.
LESSEE NOT TO ASSERT OWNERSHIP RIGHTS
6.2. THE LESSEE WILL NOT, AT ANY TIME DURING THE TERM:
6.2.1. FILE ANY INCOME TAX RETURN OR OTHER ASSOCIATED DOCUMENTS;
<PAGE> 15
6.2.2. FILE ANY OTHER DOCUMENT WITH OR SUBMIT ANY DOCUMENT TO ANY
GOVERNMENTAL BODY OR AUTHORITY;
6.2.3. ENTER INTO ANY WRITTEN CONTRACTUAL ARRANGEMENT WITH ANY
PERSON; OR
6.2.4. RELEASE ANY FINANCIAL STATEMENTS OF THE LESSEE;
in each case that takes a position other than that the Lessor is the
registered proprietor of the Land.
LESSOR'S PERSONAL PROPERTY
6.3. THE LESSEE SHALL IN ALL MATERIAL RESPECTS, DURING THE TERM, MAINTAIN
ALL OF THE LESSOR'S PERSONAL PROPERTY IN GOOD ORDER, CONDITION AND
REPAIR AS SHALL BE NECESSARY IN ORDER TO OPERATE THE FACILITY FOR THE
FACILITY'S PRIMARY INTENDED USE IN COMPLIANCE WITH ALL APPLICABLE LEGAL
REQUIREMENTS AND INSURANCE REQUIREMENTS, AND IN ACCORDANCE WITH
CUSTOMARY PRACTICE IN THE INDUSTRY FOR THE PRIMARY INTENDED USE.
REPLACEMENT OF LESSOR'S PERSONAL PROPERTY
6.4. IF ANY OF THE LESSOR'S PERSONAL PROPERTY REQUIRES REPLACEMENT IN ORDER
TO COMPLY WITH CLAUSE 6.3, THE LESSEE SHALL PROMPTLY REPLACE IT WITH
OTHER SIMILAR PROPERTY OF THE SAME OR BETTER QUALITY AT THE LESSEE'S
SOLE COST AND EXPENSE, AND THE REPLACEMENT PROPERTY SHALL BE DEEMED TO
BE FROM THE DATE OF ACQUISITION PART OF THE LESSOR'S PERSONAL PROPERTY.
NO ENCUMBRANCE
6.5. THE LESSEE SHALL NOT CAUSE OR ALLOW THE LESSOR'S PERSONAL PROPERTY TO
BE SUBJECT TO ANY ENCUMBRANCE.
ADDITIONAL EQUIPMENT ETC
6.6. THE LESSEE SHALL ALSO PROVIDE AND MAINTAIN TO A REASONABLE, SAFE AND
<PAGE> 16
PROPER STANDARD AND IN WORKING ORDER ALL ADDITIONAL ITEMS OF EQUIPMENT,
FIXTURES, FITTINGS AND CHATTELS AND OTHER PERSONAL PROPERTY AS SHALL BE
NECESSARY AND APPROPRIATE IN ORDER TO REASONABLY AND PROPERLY OPERATE
THE FACILITY FOR ITS PRIMARY INTENDED USE.
LESSEE MAY ACQUIRE PERSONAL PROPERTY
6.7. THE LESSEE SHALL HAVE THE RIGHT BUT NOT THE OBLIGATION TO ACQUIRE SUCH
TANGIBLE, MOVEABLE PERSONAL PROPERTY AS THE LESSEE DEEMS APPROPRIATE IN
RELATION TO ITS OPERATION OF THE LEASED PROPERTY AND ALL SUCH PERSONAL
PROPERTY SHALL BE THE LESSEE'S PERSONAL PROPERTY SO LONG AS IT DOES NOT
CONSTITUTE REPLACEMENT PROPERTY.
ABANDONMENT OF LESSEE'S PERSONAL PROPERTY
6.8. ALL OF THE LESSEE'S PERSONAL PROPERTY NOT ACQUIRED BY THE LESSOR UNDER
THE LESSOR'S OPTION CONTAINED IN THIS LEASE OR NOT REMOVED BY THE
LESSEE WITHIN 20 DAYS AFTER THE EXPIRATION OR EARLIER TERMINATION OF
THIS LEASE SHALL BE CONSIDERED ABANDONED BY THE LESSEE AND MAY BE
RETAINED, USED, STORED, APPROPRIATED, SOLD, DESTROYED OR OTHERWISE
DISPOSED OF BY THE LESSOR WITHOUT GIVING NOTICE TO THE LESSEE AND
WITHOUT ANY PAYMENT TO THE LESSEE AND WITHOUT ANY OBLIGATION TO ACCOUNT
TO THE LESSEE. THE LESSEE WILL, AT ITS EXPENSE, REPAIR ALL DAMAGE TO
THE LEASED PROPERTY CAUSED BY THE REMOVAL OF THE LESSEE'S PERSONAL
PROPERTY, WHETHER EFFECTED BY THE LESSEE OR THE LESSOR OTHER THAN
DAMAGE RESULTING FROM THE GROSS NEGLIGENCE OR WILFUL MISCONDUCT OF THE
LESSOR.
CHARGE OVER LESSEE'S ASSETS
6.9. THE LESSEE HAS AT THE DATE OF THIS LEASE CONCURRENTLY GRANTED TO THE
LESSOR A FIXED AND FLOATING CHARGE OVER ALL OF THE LESSEE'S ASSETS
INCLUDING A SECURITY INTEREST IN THE LESSEE'S PERSONAL PROPERTY (AS
SUCH SECURITY IS MORE PARTICULARLY DESCRIBED IN THE SECURITY AGREEMENT)
AND THE LESSOR COVENANTS (SUBJECT TO UNCONDITIONAL PAYMENT TO THE
LESSOR OF ALL MONEY AND OBLIGATIONS SECURED BY THE
<PAGE> 17
SECURITY AGREEMENT AND TO THE LESSEE NOT OTHERWISE BEING IN BREACH OF
ITS OBLIGATIONS TO THE LESSOR) TO RELEASE ABSOLUTELY THE FIXED AND
FLOATING CHARGE ON THE EARLIEST OF:
6.9.1. THE EXPIRATION OF THE TERM BY EFFLUXION OF TIME; OR
6.9.2. SURRENDER OF THE WHOLE OF THE LEASED PROPERTY VOLUNTARILY
ACCEPTED IN THE LESSOR'S ABSOLUTE DISCRETION BY THE LESSOR
(BUT NOT OTHERWISE); OR
6.9.3. THE COMPLETION OF THE PURCHASE OF THE LEASED PROPERTY BY THE
LESSEE UNDER THIS LEASE.
LESSOR DOES NOT OWN EXCLUDED PERSONAL PROPERTY
6.10. THE LESSEE ACKNOWLEDGES THAT THE LESSOR DOES NOT OWN, CLAIM OWNERSHIP
OF, NOR HAVE ANY EXPRESS OR IMPLIED RIGHTS TO ALLOW THE LESSEE TO USE
THE EXCLUDED PERSONAL PROPERTY AND THE LESSEE ENTERS THIS LEASE ON THAT
BASIS AND SHALL NOT MAKE ANY CLAIM NOR BRING ANY ACTION AGAINST THE
LESSOR IN RESPECT OF THE EXCLUDED PERSONAL PROPERTY.
CLAIM IN RESPECT OF EXCLUDED PERSONAL PROPERTY
6.11. IF A CLAIM IS MADE BY THE TRUE OWNER OR ANY THIRD PARTY OF THE EXCLUDED
PERSONAL PROPERTY AGAINST THE LESSEE, THE LESSEE SHALL NOTIFY THE
LESSOR, IN WRITING, IMMEDIATELY UPON LEARNING OF ANY SUCH CLAIM AND IF
ANY SUCH CLAIM IS MADE AGAINST THE LESSOR, THE LESSEE SHALL AND DOES
HEREBY INDEMNIFY THE LESSOR, ITS PRINCIPALS, OFFICERS, DIRECTORS,
AGENTS AND EMPLOYEES (HEREINAFTER, ALL "INDEMNITIES") FROM EACH AND
EVERY SUCH CLAIM, CAUSE OF ACTION, DAMAGES, DEMAND, OBLIGATION, FINE,
LIABILITY, LOSS, SETTLEMENT, LIEN, LITIGATION, JUDGMENT, PROCEEDING,
DISBURSEMENT EXPENSE AND/OR COST, HOWEVER DEFINED AND OF WHATEVER KIND
OR NATURE, KNOWN OR UNKNOWN, FORESEEABLE, CONTINGENT OR OTHERWISE
(INCLUDING, BUT NOT LIMITED TO, LEGAL FEES) IN CONNECTION WITH SUCH
CLAIM OR CLAIMS.
<PAGE> 18
REMOVAL OF EXCLUDED PERSONAL PROPERTY
6.12. IF THE TRUE OWNER OR ANY THIRD PARTY REMOVES THE EXCLUDED PERSONAL
PROPERTY OR ANY PORTION OF THE EXCLUDED PERSONAL PROPERTY FROM THE
LEASED PROPERTY, THE LESSEE SHALL REPLACE THE SAME WITHOUT DELAY AT ITS
OWN EXPENSE BY CHATTELS OF A SIMILAR KIND AND OF NO LESSER VALUE AND
FOLLOWING SUCH REPLACEMENT SUCH CHATTELS SHALL BE DEEMED TO BE THE
LESSOR'S PERSONAL PROPERTY. THERE SHALL BE NO OBLIGATION ON THE LESSEE
UNDER THIS CLAUSE TO REPLACE (OR PAY FOR THE REPLACEMENT OF) THE
RESIDENTS' PERSONAL PROPERTY.
7. CONDITION OF LEASED PROPERTY USE AND ENVIRONMENTAL MATTERS
LEASED PROPERTY "AS IS"
7.1. THE LESSEE ACKNOWLEDGES:
7.1.1. RECEIPT AND DELIVERY OF POSSESSION OF THE LEASED PROPERTY;
7.1.2. THAT THE LESSEE HAS EXAMINED AND INSPECTED AND OTHERWISE HAS
KNOWLEDGE OF THE CONDITION OF THE LEASED PROPERTY BEFORE THE
EXECUTION AND DELIVERY OF THIS LEASE AND HAS FOUND ALL OF THE
SAME TO BE IN GOOD ORDER AND REPAIR AND SATISFACTORY FOR THE
PRIMARY INTENDED USE;
7.1.3. THE LESSEE IS LEASING THE LEASED PROPERTY "AS IS" IN ITS
PRESENT CONDITION AND THE LESSEE WAIVES ANY CLAIM OR ACTION
AGAINST THE LESSOR IN RESPECT OF THE CONDITION OF THE LEASED
PROPERTY AND THE EXCLUDED PERSONAL PROPERTY;
7.1.4. THE LESSOR MAKES NO WARRANTY OR REPRESENTATION EXPRESS OR
IMPLIED, IN RESPECT OF THE LEASED PROPERTY OR THE EXCLUDED
PERSONAL PROPERTY OR ANY PART OF THE LEASED PROPERTY OR
EXCLUDED PERSONAL PROPERTY, EITHER AS TO ITS FITNESS FOR USE,
DESIGN OR CONDITION FOR ANY PARTICULAR USE OR PURPOSE OR
OTHERWISE, AS TO THE QUALITY OF THE MATERIAL OR
<PAGE> 19
WORKMANSHIP, LATENT OR PATENT, IT BEING AGREED THAT ALL SUCH
RISKS ARE TO BE BORNE BY THE LESSEE;
7.1.5. THE LESSEE IS SOLELY RESPONSIBLE FOR THE CONDITION OF THE
LEASED PROPERTY AND THE EXCLUDED PERSONAL PROPERTY; AND
7.1.6. THE LESSOR MAKES NO WARRANTY OR REPRESENTATION EXPRESS OR
IMPLIED IN RESPECT OF THE APPROVALS, IT BEING AGREED THAT THE
LESSEE SHALL BE RESPONSIBLE FOR OBTAINING, MAINTAINING AND
RENEWING ALL APPROVALS.
LESSEE'S COVENANTS RE APPROVALS ETC
7.2. THE LESSEE COVENANTS THAT IT COMPLIES WITH ALL OBLIGATIONS AND LEGAL
REQUIREMENTS INCLUDING THAT IT:
7.2.1. HAS CURRENT VALID APPROVALS;
7.2.2. WILL OBTAIN, MAINTAIN AND RENEW ALL APPROVALS; AND
7.2.3. DO ALL THINGS NECESSARY TO ENSURE THAT ALL APPROVALS ARE NOT
PREJUDICED IN ANY WAY.
7.3. THE LESSEE COVENANTS THAT IT:
7.3.1. WILL IMMEDIATELY GIVE NOTICE TO THE LESSOR IF ANY APPROVALS
ARE NOT OBTAINED, NOT RENEWED OR ARE REFUSED OR HAVE BEEN
REVOKED, SUSPENDED, TERMINATED, OTHERWISE CANCELLED OR MADE
SUBJECT TO SANCTIONS OR CONDITIONS UNDER ESSENTIAL
LEGISLATION;
7.3.2. WILL IMMEDIATELY GIVE NOTICE TO THE LESSOR IF THE LESSEE IS
AWARE OF ANY NOTICE OR INFORMATION, WHETHER FORMAL OR
INFORMAL, THAT MAY FORM THE BASIS FOR ANY APPROVALS TO BE
REFUSED OR BE REVOKED, SUSPENDED, TERMINATED, OTHERWISE
CANCELLED OR MADE SUBJECT TO SANCTIONS OR CONDITIONS UNDER
ESSENTIAL LEGISLATION;
<PAGE> 20
7.3.3. WILL DURING THE TERM CONTINUOUSLY OPERATE THE FACILITY IN
ACCORDANCE WITH ITS PRIMARY INTENDED USE AND SHALL USE ALL
REASONABLE ENDEAVOURS TO PROMOTE SUCH BUSINESS AND (WITHOUT
PREJUDICE TO THE FOREGOING AND EXCEPT WHERE REQUIRED BY LAW)
SHALL NOT REDUCE, SEEK TO REDUCE OR ALLOW TO BE REDUCED TO
FEWER THAN 1938 THE TOTAL NUMBER OF AGED CARE PLACES AT ALL
FACILITIES.
7.3.4. GIVE THE LESSOR 1 MONTH'S WRITTEN NOTICE BEFORE THE LESSEE
TRANSFERS ANY AGED CARE PLACE FROM ONE FACILITY TO ANOTHER OR
OTHERWISE INCREASES OR DECREASES THE NUMBER OF SUCH AGED CARE
PLACES AS MAY BE PERMITTED IN ACCORDANCE WITH CLAUSE 7.3(C).
7.4. THE LESSEE COVENANTS TO RECTIFY ANY REMEDIAL BREACHES OF THE COVENANTS
CONTAINED IN CLAUSE 7.2 OR CLAUSE 7.3 WITHIN 30 DAYS OR SUCH LESSER
PERIOD OF TIME AS STIPULATED IN ESSENTIAL LEGISLATION, EXCEPT WHERE THE
LESSOR DETERMINES SUCH BREACHES ARE CRITICAL OR FUNDAMENTAL IN WHICH
CASE SUCH BREACHES MUST BE RECTIFIED IMMEDIATELY.
USE OF LEASED PROPERTY
7.5. WITHOUT PREJUDICE TO CLAUSES 7.2, 7.3 AND 7.4 THE LESSEE SHALL NOT USE
THE LEASED PROPERTY OR ANY PORTION THEREOF FOR ANY OTHER USE THAN THE
PRIMARY INTENDED USE. NO USE SHALL BE MADE OR PERMITTED TO BE MADE OF
THE LEASED PROPERTY, AND NO ACTS SHALL BE DONE, WHICH WILL CAUSE OR
PERMIT THE CANCELLATION OR AVOIDANCE OF OR REFUSAL OF PAYMENT UNDER ANY
INSURANCE POLICY COVERING THE LEASED PROPERTY OR ANY PART THEREOF, NOR
SHALL THE LESSEE SELL OR OTHERWISE PROVIDE TO RESIDENTS OR PATIENTS, OR
PERMIT TO BE KEPT, USED OR SOLD IN OR ABOUT THE LEASED PROPERTY ANY
ARTICLE WHICH MAY BE PROHIBITED BY LAW OR BY THE STANDARD FORM OF FIRE
INSURANCE POLICIES, OR ANY OTHER INSURANCE POLICIES REQUIRED TO BE
CARRIED OUT UNDER THIS LEASE, OR FIRE UNDERWRITER'S REGULATION.
<PAGE> 21
NO WASTE
7.6. THE LESSEE SHALL NOT COMMIT OR SUFFER TO BE COMMITTED ANY WASTE (NOT
BEING AMELIORATING WASTE IN COMPLIANCE WITH THE PROVISIONS OF THIS
LEASE) ON THE LEASED PROPERTY, OR IN ANY FACILITY, NOR SHALL THE LESSEE
CAUSE OR PERMIT ANY NUISANCE.
NOT TO SUFFER CERTAIN THINGS
7.7. THE LESSEE SHALL NEITHER USE NOR SUFFER OR PERMIT THE LEASED PROPERTY
OR ANY PORTION OF THE LEASED PROPERTY, OR THE LESSEE'S PERSONAL
PROPERTY, OR THE EXCLUDED PERSONAL PROPERTY TO BE USED IN SUCH A MANNER
WHICH:
7.7.1. IMPAIRS THE LESSOR'S (OR THE LESSEE'S, AS THE CASE MAY BE)
TITLE; OR
7.7.2. IS OR IN THE PROPER OPINION OF THE LESSOR MAY BE OR BECOME A
NUISANCE OR DAMAGE (INCLUDING, WITHOUT LIMITATION, ANNOYANCE
CAUSED BY RADIO, TELEVISION OR OTHER SOUND-PRODUCING APPARATUS
OR ANY MACHINERY OR MECHANICAL INSTRUMENT) TO THE LESSOR OR TO
THE OWNERS OR OCCUPIERS OF ANY ADJOINING OR NEIGHBOURING
PROPERTY.
NO WARRANTY RE USE
7.8. THERE IS NO IMPLIED REPRESENTATION OR WARRANTY OR OTHER OBLIGATION ON
THE PART OF THE LESSOR THAT THE PRIMARY INTENDED USE IS A PERMITTED USE
UNDER THE PLANNING ACTS.
NOTICE OF DEFECT
7.9. WITHOUT DELAY UPON BECOMING AWARE OF IT THE LESSEE SHALL GIVE NOTICE TO
THE LESSOR OF ANY DEFECT IN THE STATE OF THE LEASED PROPERTY WHICH
WOULD OR MIGHT GIVE RISE TO AN OBLIGATION ON THE LESSOR TO DO OR
REFRAIN FROM DOING ANYTHING IN ORDER TO COMPLY WITH ANY DUTY OF CARE
IMPOSED ON THE LESSOR BY STATUTE OR COMMON LAW AND THE LESSEE SHALL
INDEMNIFY THE LESSOR AGAINST ALL ACTIONS, CLAIMS, COSTS, DEMANDS,
EXPENSES, LIABILITIES AND LOSSES ARISING FROM ANY FAILURE TO GIVE SUCH
<PAGE> 22
NOTICE AND AT ALL TIMES TO DISPLAY AND MAINTAIN ALL SAFETY NOTICES (AND
THEIR WORDING) WHICH THE LESSOR MAY FROM TIME TO TIME REASONABLY
REQUIRE TO BE DISPLAYED AT THE LEASED PROPERTY.
NO HAZARDOUS SUBSTANCES
7.10. THE LESSEE SHALL NOT PERMIT, CONDUCT OR ALLOW ON THE LEASED PROPERTY,
THE GENERATION, INTRODUCTION, PRESENCE, MAINTENANCE, USE, RECEIPT,
ACCEPTANCE, TREATMENT, MANUFACTURE, PRODUCTION, INSTALLATION,
MANAGEMENT, STORAGE, DISPOSAL OR RELEASE OF ANY HAZARDOUS SUBSTANCES
EXCEPT IN COMPLIANCE WITH ALL ENVIRONMENTAL LAWS.
NOTICE OF REGULATORY ACTIONS
7.11. THE LESSEE WILL NOTIFY THE LESSOR IMMEDIATELY UPON LEARNING OF ANY
EXISTING, PENDING OR THREATENED:
7.11.1. INVESTIGATION, INQUIRY, CLAIM OR ACTION BY ANY GOVERNMENTAL OR
STATUTORY AUTHORITY OR LOCAL COUNCIL IN CONNECTION WITH ANY
ENVIRONMENTAL LAWS;
7.11.2. THIRD PARTY CLAIMS;
7.11.3. REGULATORY ACTIONS; AND/OR
7.11.4. CONTAMINATION OF THE LEASED PROPERTY.
COST OF REMEDIAL ACTION
7.12.
7.12.1. IF ANY INVESTIGATION AND/OR CLEAN-UP IS REQUIRED BY ANY
ENVIRONMENTAL LAW OR BY THE LESSOR FOLLOWING AN ENVIRONMENTAL
AUDIT UNDER CLAUSE 7.14, THEN THE LESSEE SHALL COMPLETE, AT
ITS OWN EXPENSE, SUCH INVESTIGATION AND/OR CLEAN-UP OR CAUSE
EACH SUCH OTHER PERSON AS MAY BE RESPONSIBLE FOR ANY OF THE
FOLLOWING TO CONDUCT SUCH INVESTIGATION AND/OR CLEAN-UP.
7.12.2. IN THE CASE OF THE EXPIRATION OR EARLIER TERMINATION OF THE
TERM OF THIS LEASE, THE LESSEE SHALL CAUSE THE
<PAGE> 23
LEASED PROPERTY TO BE DELIVERED IN A MANNER THAT IS REQUIRED
TO ENSURE THAT THE THEN PRESENT OR FUTURE USE, OPERATION,
LEASING, DEVELOPMENT, CONSTRUCTION, ALTERATION, REFINANCING OR
SALE OF THE LEASED PROPERTY SHALL NOT BE RESTRICTED BY ANY
ENVIRONMENTAL CONDITION.
DELIVERY OF ENVIRONMENTAL DOCUMENTS
7.13. THE LESSEE SHALL DELIVER TO THE LESSOR OR ITS ASSOCIATED COMPANIES,
COMPLETE COPIES OF ANY AND ALL ENVIRONMENTAL DOCUMENTS THAT MAY NOW BE
IN OR AT ANY TIME IN THE FUTURE COME INTO THE POSSESSION OF THE LESSEE.
ENVIRONMENTAL AUDIT
7.14. AT THE LESSEE'S EXPENSE, THE LESSEE SHALL FROM TIME TO TIME, AFTER THE
LESSOR'S REQUEST THEREFOR, PROVIDE TO THE LESSOR A WRITTEN CERTIFICATE,
IN FORM AND SUBSTANCE SATISFACTORY TO THE LESSOR, FROM AN ENVIRONMENTAL
FIRM ACCEPTABLE TO THE LESSOR, WHICH STATES THAT THE LEASED PROPERTY
DOES NOT CONTAIN ANY HAZARDOUS SUBSTANCES OTHER THAN THOSE HAZARDOUS
SUBSTANCES WHICH WILL NOT MATERIALLY ADVERSELY AFFECT EITHER THE
PRIMARY INTENDED USE OF THE FACILITY OR THE VALUE OF THE LEASED
PROPERTY. ALL TESTS AND SAMPLES SHALL BE CONDUCTED USING GENERALLY
ACCEPTED AND SCIENTIFICALLY VALID TECHNOLOGY AND METHODOLOGIES. THE
LESSEE SHALL GIVE THE ENGINEER OR ENVIRONMENTAL CONSULTANT REASONABLE
ACCESS TO THE LEASED PROPERTY AND TO ALL RECORDS IN THE POSSESSION OF
THE LESSEE THAT MAY INDICATE THE PRESENCE (WHETHER CURRENT OR PAST) OR
RELEASE OF ANY HAZARDOUS SUBSTANCES ON, IN, UNDER OR ABOUT THE LEASED
PROPERTY. THE LESSEE SHALL ALSO PROVIDE THE ENGINEER OR ENVIRONMENTAL
CONSULTANT AN OPPORTUNITY TO INTERVIEW SUCH PERSONS EMPLOYED (AT ANY
TIME) IN CONNECTION WITH THE LEASED PROPERTY AS THE ENGINEER OR
CONSULTANT DEEMS APPROPRIATE. AFTER THE LESSOR HAS REQUESTED AND
RECEIVED SUCH A CERTIFICATE FROM THE LESSEE, THE LESSOR SHALL NOT BE
ENTITLED TO REQUEST ANY FURTHER CERTIFICATES UNLESS:
<PAGE> 24
7.14.1. THERE HAVE BEEN ANY CHANGES, MODIFICATIONS OR ADDITIONS TO ANY
ENVIRONMENTAL LAWS WHICH APPLY TO OR AFFECT THE LEASED
PROPERTY;
7.14.2. ALTERATIONS OF A STRUCTURAL NATURE HAVE BEEN MADE TO THE
LEASED PROPERTY;
7.14.3. THERE HAS BEEN A SIGNIFICANT CHANGE IN THE CONDITION OF THE
LEASED PROPERTY; OR
7.14.4. THE LESSOR HAS ANOTHER GOOD REASON FOR REQUESTING SUCH
CERTIFICATE OR CERTIFICATES.
IF THE ENGINEER OR ENVIRONMENTAL CONSULTANT DISCOVERS ANY HAZARDOUS
SUBSTANCES, THE LESSEE SHALL IMMEDIATELY REPORT SUCH FACT TO THE
LESSOR, AND THE LESSEE SHALL PERFORM ALL OF THE LESSEE'S OTHER
OBLIGATIONS UNDER THIS LEASE WITH RESPECT TO SUCH HAZARDOUS SUBSTANCES.
RIGHT OF ENTRY WHERE ENVIRONMENTAL MATTER
7.15. IF THE LESSEE FAILS TO PROVIDE AN ENVIRONMENTAL AUDIT REFERRED TO IN
CLAUSE 7.12, THE LESSEE SHALL PERMIT THE LESSOR FROM TIME TO TIME, BY
ITS EMPLOYEES, AGENTS, CONTRACTORS OR REPRESENTATIVES, TO ENTER UPON
THE LEASED PROPERTY FOR THE PURPOSES OF TAKING SAMPLES AND CONDUCTING
SUCH SOIL AND CHEMICAL TESTS OR ANY OTHER ENVIRONMENTAL INVESTIGATIONS,
EXAMINATIONS, OR ANALYSES (HEREAFTER COLLECTIVELY REFERRED TO AS
"INVESTIGATION") AS THE LESSOR MAY DESIRE. THE LESSOR, AND ITS
EMPLOYEES, AGENTS, CONTRACTORS, CONSULTANTS AND/OR REPRESENTATIVES,
SHALL CONDUCT ANY INVESTIGATION IN A MANNER WHICH DOES NOT UNREASONABLY
INTERFERE WITH THE LESSEE'S USE AND OPERATIONS EXCEPT IF THE
INVESTIGATION CANNOT OTHERWISE BE REASONABLY AND INEXPENSIVELY
CONDUCTED. THE LESSOR SHALL GIVE THE LESSEE REASONABLE PRIOR NOTICE
OTHER THAN IN AN EMERGENCY, BEFORE ENTERING ONTO THE LEASED PROPERTY TO
CONDUCT SUCH INVESTIGATION, AND SHALL PROVIDE COPIES OF ANY REPORTS OR
RESULTS TO THE LESSEE, AND THE LESSEE SHALL COOPERATE FULLY IN SUCH
INVESTIGATION.
<PAGE> 25
ENVIRONMENTAL MATTERS ON TERMINATION
7.16. AT THE END OF THIS LEASE, THE LESSEE SHALL CAUSE THE LEASED PROPERTY TO
BE DELIVERED FREE OF ANY AND ALL REGULATORY ACTIONS AND THIRD PARTY
CLAIMS AND OTHERWISE IN COMPLIANCE WITH ALL ENVIRONMENTAL LAWS
AFFECTING THE LEASED PROPERTY.
COMPLIANCE WITH ENVIRONMENTAL LAWS
7.17. THE LESSEE SHALL COMPLY WITH, AND CAUSE ITS AGENTS, SERVANTS AND
EMPLOYEES, TO COMPLY WITH, AND SHALL USE REASONABLE EFFORTS TO CAUSE
EACH TENANT AND OTHER OCCUPANT AND USER OF THE LEASED PROPERTY, AND THE
AGENTS, SERVANTS AND EMPLOYEES OF SUCH TENANTS, OCCUPANTS AND USERS, TO
COMPLY WITH EACH AND EVERY ENVIRONMENTAL LAW APPLICABLE TO THE LESSEE,
THE LEASED PROPERTY AND EACH SUCH TENANT, OCCUPANT OR USER WITH RESPECT
OF THE LEASED PROPERTY. SPECIFICALLY, BUT WITHOUT LIMITATION:
7.17.1. THE LESSEE SHALL OBTAIN AND MAINTAIN (AND THE LESSEE SHALL USE
REASONABLE EFFORTS TO CAUSE EACH TENANT, OCCUPANT AND USER TO
OBTAIN AND MAINTAIN) ALL PERMITS, CERTIFICATES, LICENCES AND
OTHER CONSENTS AND APPROVALS REQUIRED BY ANY APPLICABLE
ENVIRONMENTAL LAW FROM TIME TO TIME WITH RESPECT TO THE
LESSEE, EACH AND EVERY PART OF THE LEASED PROPERTY AND/OR THE
CONDUCT OF ANY BUSINESS AT THE FACILITY OR RELATED THERETO;
7.17.2. THE LESSEE SHALL NOT CAUSE, SUFFER OR PERMIT ANY
CONTAMINATION;
7.17.3. IF A CONTAMINATION OCCURS, THE LESSEE SHALL PROMPTLY CLEAN-UP
AND REMOVE ANY HAZARDOUS SUBSTANCE OR CAUSE THE CLEAN-UP AND
THE REMOVAL OF ANY HAZARDOUS SUBSTANCE AND IN ANY SUCH CASE
THE CLEAN-UP AND REMOVAL OF THE HAZARDOUS SUBSTANCE SHALL BE
EFFECTED IN STRICT COMPLIANCE WITH AND IN ACCORDANCE WITH THE
PROVISIONS OF THE APPLICABLE ENVIRONMENTAL LAWS;
<PAGE> 26
7.17.4. PROMPTLY UPON RECEIPT BY THE LESSEE OF NOTICE OR DISCOVERY BY
THE LESSEE OF ANY FACT OR CIRCUMSTANCE WHICH MIGHT RESULT IN A
BREACH OR VIOLATION OF ANY COVENANT OR AGREEMENT, THE LESSEE
SHALL NOTIFY THE LESSOR IN WRITING OF SUCH FACT OR
CIRCUMSTANCE; AND
7.17.5. PROMPTLY UPON RECEIPT OF ANY REQUEST, ORDER OR OTHER NOTICE
RELATING TO THE LEASED PROPERTY UNDER ANY ENVIRONMENTAL LAW,
THE LESSEE SHALL FORWARD A COPY THEREOF TO THE LESSOR.
ENVIRONMENTAL RELATED REMEDIES
7.18. IN THE EVENT OF A BREACH BY THE LESSEE BEYOND ANY APPLICABLE NOTICE
AND/OR GRACE PERIOD OF ITS COVENANTS WITH RESPECT TO ENVIRONMENTAL
MATTERS, THE LESSOR MAY, IN ITS SOLE DISCRETION, DO ANY ONE OR MORE OF
THE FOLLOWING (THE EXERCISE OF ONE RIGHT OR REMEDY UNDER THIS LEASE NOT
PRECLUDING THE SIMULTANEOUS OR SUBSEQUENT TAKING OF ANY OTHER RIGHT
HEREUNDER):
7.18.1. CAUSE THE CLEAN-UP OF ANY HAZARDOUS SUBSTANCE OR OTHER
ENVIRONMENTAL CONDITION ON OR UNDER THE LEASED PROPERTY, OR
BOTH, AT THE LESSEE'S COST AND EXPENSE; OR
7.18.2. PAY ON BEHALF OF THE LESSEE ANY DAMAGES, COSTS, FINES OR
PENALTIES IMPOSED ON THE LESSEE AS A RESULT OF ANY REGULATORY
ACTIONS; OR
7.18.3. PAY, ON BEHALF OF THE LESSEE, ANY DAMAGES, COSTS, FINES OR
PENALTIES IMPOSED ON THE LESSEE AS A RESULT OF ANY THIRD PARTY
CLAIMS; OR
7.18.4. DEMAND THAT THE LESSEE MAKE IMMEDIATE PAYMENT OF ALL OF THE
COSTS OF SUCH CLEAN-UP AND/OR EXERCISE OF THE REMEDIES SET
FORTH IN THIS CLAUSE 7.16 INCURRED BY THE LESSOR AND NOT PAID
BY THE LESSEE AS OF THE DATE OF SUCH DEMAND WHETHER OR NOT
SUCH SUMS WERE ADDED TO THE INDEBTEDNESS SECURED BY THIS
<PAGE> 27
LEASE (AND WHETHER OR NOT ANY COURT HAS ORDERED THE CLEAN-UP)
AND SUCH COSTS SHALL BECOME IMMEDIATELY DUE AND PAYABLE,
WITHOUT NOTICE.
ENVIRONMENTAL INDEMNITIES
7.19. THE LESSEE SHALL AND DOES HEREBY INDEMNIFY, DEFEND AND HOLD HARMLESS
THE LESSOR, ITS PRINCIPALS, OFFICERS, DIRECTORS, AGENTS AND EMPLOYEES
FROM EACH AND EVERY INCURRED AND POTENTIAL CLAIM, CAUSE OF ACTION,
DAMAGE, DEMAND, OBLIGATION, FINE, LABORATORY FEE, LIABILITY, LOSS,
PENALTY, IMPOSITION SETTLEMENT, LEVY, LIEN, REMOVAL, LITIGATION,
JUDGMENT, PROCEEDING, DISBURSEMENT, EXPENSE AND/OR COST (INCLUDING
WITHOUT LIMITATION THE COST OF EACH AND EVERY CLEAN-UP), HOWEVER
DEFINED AND OF WHATEVER KIND OR NATURE, KNOWN OR UNKNOWN, FORESEEABLE
OR UNFORESEEABLE, CONTINGENT OR OTHERWISE (INCLUDING, BUT NOT LIMITED
TO, LEGAL FEES, CONSULTANTS' FEES, EXPERTS' FEES AND RELATED EXPENSES,
CAPITAL, OPERATING AND MAINTENANCE COSTS), INCURRED IN CONNECTION WITH:
7.19.1. ANY INVESTIGATION OR MONITORING OF SITE CONDITIONS; AND
7.19.2. ANY CLEAN-UP REQUIRED OR PERFORMED BY ANY STATE OR LOCAL
GOVERNMENT ENTITY OR PERFORMED BY ANY OTHER ENTITY OR PERSON
BECAUSE OF THE PRESENCE OF ANY HAZARDOUS SUBSTANCE, RELEASE,
THREATENED RELEASE OR ANY CONTAMINATION ON, IN, UNDER OR ABOUT
ANY OF THE LEASED PROPERTY WHICH MAY BE ASSERTED AGAINST,
IMPOSED ON, SUFFERED OR INCURRED BY THE LESSOR ARISING OUT OF
OR IN ANY WAY RELATED TO, OR ALLEGEDLY ARISING OUT OF OR DUE
TO ANY ENVIRONMENTAL MATTER INCLUDING, BUT NOT LIMITED TO, ANY
ONE OR MORE OF THE FOLLOWING:
7.19.2.1. the disposal, release, threatened release or the
presence of or disturbance of any Hazardous
Substance on, in, at, from, under or affecting the
Leased Property, including, without limitation, the
presence of any Hazardous Substance which has
<PAGE> 28
come to be located in, on, at, under, or near the
Leased Property from another location;
7.19.2.2. all injuries to health or safety (including
wrongful death), or to the environment, by reason
of environmental matters relating to the condition
of or activities past or present on, at, in, under
any of the Leased Properties;
7.19.2.3. all breaches, and alleged breaches, of any
Environmental Law relating to the Leased Property
or any activity on, in, at, under or near the
Leased Property;
7.19.2.4. all misrepresentations relating to environmental
matters in any documents or materials furnished by
the Lessee to the Lessor and/or its
representatives;
7.19.2.5. each and every Event of Default under this Lease
relating to environmental matters;
7.19.2.6. any and all legal proceedings brought or threatened
against any the Lessor, settlements reached and
governmental orders relating to any Hazardous
Substances at, on, in, under or near the Leased
Property, and all demands of governmental
authorities, and all policies and requirements of
the Lessor's insurers, based upon or in any way
related to any Hazardous Substances at, on, in,
under the Leased Property.
RIGHTS ADDITIONAL AND WILL SURVIVE
7.20. THE RIGHTS GRANTED TO THE LESSOR UNDER THIS CLAUSE 7 ARE IN ADDITION TO
AND NOT IN LIMITATION OF ANY OTHER RIGHTS OR REMEDIES AVAILABLE TO THE
LESSOR UNDER THIS LEASE OR ALLOWED AT LAW OR IN EQUITY. THE
INDEMNIFICATION OBLIGATIONS SET FORTH IN THIS CLAUSE 7 SHALL SURVIVE
THE EXPIRATION OR EARLIER TERMINATION OF THE TERM OF THIS LEASE.
LEGAL AND INSURANCE REQUIREMENTS
7.21. SUBJECT TO PART 12 RELATING TO PERMITTED CONTESTS, THE LESSEE, AT ITS
<PAGE> 29
EXPENSE, WILL PROMPTLY COMPLY WITH ALL APPLICABLE LEGAL REQUIREMENTS
AND INSURANCE REQUIREMENTS IN RESPECT OF THE USE, OPERATION,
MAINTENANCE, REPAIR AND RESTORATION OF THE LEASED PROPERTY AND THE
LESSEE'S PERSONAL PROPERTY, WHETHER OR NOT COMPLIANCE REQUIRES
EXECUTION OF STRUCTURAL CHANGES OR OTHER WORKS TO THE LEASED PROPERTY
AND WHETHER BY LANDLORD OR TENANT, OR INTERFERES WITH THE USE AND
ENJOYMENT OF THE LEASED PROPERTY.
8. FINANCIAL COVENANTS
LESSEE'S TANGIBLE NET WORTH
8.1. AT ALL TIMES DURING THE TERM, THE LESSEE SHALL MAINTAIN A TANGIBLE NET
WORTH OF NOT LESS THAN THE MINIMUM TANGIBLE NET WORTH. IF AT ANY TIME
DURING THE TERM, THE LESSOR OR THE LESSEE DISCOVERS THAT THE LESSEE'S
TANGIBLE NET WORTH IS LESS THAN THE MINIMUM TANGIBLE NET WORTH THEN THE
LESSEE SHALL CAUSE ITS SHAREHOLDERS OR NEW SHAREHOLDERS TO CONTRIBUTE
EQUITY CAPITAL TO THE LESSEE AS NECESSARY TO SATISFY THE REQUIREMENTS
UNDER THIS PART. THE LESSEE MUST SATISFY SUCH REQUIREMENTS WITHIN A 30
DAY PERIOD AFTER DISCOVERY, AND THE FAILURE TO DO SO SHALL CONSTITUTE
AN EVENT OF DEFAULT UNDER THIS LEASE.
CURRENT RATIO
8.2. AT ALL TIMES DURING THE TERM OF THIS LEASE THE LESSEE SHALL MAINTAIN A
RATIO OF CURRENT ASSETS TO CURRENT LIABILITIES OF NOT LESS THAN 1.1 TO
1.
CASH FLOW/RENT RATIO
8.3.
8.3.1. FROM THE COMMENCEMENT DATE TO 30 JUNE 1999 THE LESSEE SHALL
MAINTAIN A RATIO OF GROSS CASH FLOW TO RENT OF NOT LESS THAN
1.5 TO 1;
8.3.2. FROM 1 JULY 1999 TO 30 JUNE 2000 THE LESSEE SHALL MAINTAIN A
RATIO OF CASH FLOW TO RENT OF NOT LESS THAN 1.2 TO 1; AND
<PAGE> 30
8.3.3. DURING THE REMAINDER OF THE TERM THE LESSEE SHALL MAINTAIN A
RATIO OF CASH FLOW TO RENT OF NOT LESS THAN 1.25 TO 1.
CASH FLOW COVERAGE FOR ADDITIONAL DEBT
8.4. THE LESSEE SHALL NOT INCUR ANY ADDITIONAL DEBT UNTIL SUCH TIME AS THE
RATIO OF CASH FLOW TO DEBT SERVICE EQUALS OR EXCEEDS THE RATIO OF CASH
FLOW TO RENT FOR THE RELEVANT LEASE YEAR WHICH THE LESSEE MUST MAINTAIN
IN ACCORDANCE WITH CLAUSE 8.3 (AFTER INCLUDING THE PROPOSED ADDITIONAL
DEBT IN THE DEFINITION OF DEBT FOR PURPOSES OF ARRIVING AT DEBT SERVICE
WITH RESPECT TO THE NEW DEBT). THE LESSEE'S DEBT SHALL BE DETERMINED AS
OF THE END OF EACH CALENDER YEAR FROM THE LESSEE'S ACCOUNTS. AS USED IN
THIS CLAUSE, DEBT EXCLUDES LOANS FROM ASSOCIATED COMPANIES OF THE
LESSEE WHICH ARE SUBORDINATED TO THE RIGHTS OF THE LESSOR UNDER WRITTEN
SUBORDINATION AGREEMENTS IN A FORM AND SUBSTANCE ACCEPTABLE TO THE
LESSOR ACTING REASONABLY.
MINIMUM CAPITAL EXPENDITURE
8.5. THE LESSEE SHALL DURING EACH LEASE YEAR EXPEND AT LEAST $300 (EXCLUSIVE
OF GST AND ANY SUMS EXPENDED IN REPLACING LESSOR'S PERSONAL PROPERTY IN
ACCORDANCE WITH CLAUSE 6.4) PER BED FOR CAPITAL EXPENDITURES TO IMPROVE
THE NET UNDERLYING ASSET VALUE OF THE FACILITIES THE TOTAL AMOUNT TO BE
SPENT PER FACILITY TO BE A MULTIPLE OF $300 (EXCLUSIVE OF GST AND ANY
SUMS EXPENDED IN REPLACING LESSOR'S PERSONAL PROPERTY IN ACCORDANCE
WITH CLAUSE 6.4, AND INCREASED IN ACCORDANCE WITH INCREASES IN CPI AS
SET OUT BELOW) AND THE NUMBER OF BEDS AT THE RELEVANT FACILITY OR SUCH
OTHER AMOUNT PER FACILITY AS THE LESSOR MAY AGREE TO FOLLOWING RECEIPT
OF THE CAPITAL AND OPERATING BUDGETS TO BE SUPPLIED TO LESSOR BY LESSEE
IN ACCORDANCE WITH CLAUSE 24.1(E) INCREASED IN EACH YEAR BY A
PROPORTION EQUIVALENT TO THE INCREASE IN THE CONSUMER PRICE INDEX
DURING THE PRECEDING LEASE YEAR (MAKING SUCH ARITHMETIC ADJUSTMENTS AS
SHALL BE NECESSARY TO REFLECT ANY REBASING OF THE CONSUMER PRICE
INDEX).
<PAGE> 31
LIMITATION ON DISTRIBUTIONS
8.6.
8.6.1. SUBJECT TO CLAUSE 8.6(B), IF AT ANY TIME THE TANGIBLE NET
WORTH OF THE LESSEE IS LESS THAN $2,000,000, THE LESSEE SHALL
NOT MAKE ANY PAYMENT OR DISTRIBUTION INCLUDING ANY, LOAN
(INCLUDING, BUT NOT LIMITED TO, A LOAN TO A GROUP COMPANY),
PRINCIPAL OR INTEREST PAYMENT OR OTHERWISE TO ANY PERSON
(WHETHER AN ASSOCIATED COMPANY OR NOT).
8.6.2. THE LESSEE MAY ONLY MAKE A PAYMENT OR DISTRIBUTION BY WAY OF
MANAGEMENT FEES AT ANY TIME TO ANY PERSON (WHETHER AN
ASSOCIATED COMPANY OR NOT) IF THE LESSEE:
8.6.2.1. has first paid the Rent and any Additional Charges
payable at the time such payment or distribution is
made and any payable in respect of any previous
period; and
8.6.2.2. is not otherwise in breach of any of its Obligations
under this Lease.
8.6.3. THE LESSEE MAY PAY OR DISTRIBUTE UP TO 70% OF NET PROFIT BY
WAY OF DIVIDEND, LOAN (INCLUDING, BUT NOT LIMITED TO, A LOAN
TO A GROUP COMPANY) PRINCIPAL OR INTEREST PAYMENT OR OTHERWISE
TO ANY PERSON (WHETHER AN ASSOCIATED COMPANY OR NOT) PROVIDED:
8.6.3.1. the Lessee has first paid the Rent and Additional
Charges payable at the time such payment or
distribution is made and any payable in respect of
any previous period;
8.6.3.2. the Tangible Net Worth of the Lessee exceeds
$2,000,000 but is less than $3,000,000 (both before
and after the relevant distribution is made); and
<PAGE> 32
8.6.3.3. the Lessee is not otherwise in breach of any of its
Obligations under this Lease.
8.6.4. THE LESSEE MAY MAKE ANY PAYMENT OR DISTRIBUTION BY WAY OF
DIVIDEND, LOAN (INCLUDING, BUT NOT LIMITED TO, A LOAN TO A
GROUP COMPANY), PRINCIPAL OR INTEREST PAYMENT OR OTHERWISE TO
ANY PERSON (WHETHER AN ASSOCIATED COMPANY OR NOT) PROVIDED:
8.6.4.1. the Lessee has first paid the Rent and Additional
Charges payable at the time such payment or
distribution is made and any payable in respect of
any previous period;
8.6.4.2. the Tangible Net Worth of the Lessee exceeds
$3,000,000 (both before and after the relevant
payment or distribution is made); and
8.6.4.3. the Lessee is not otherwise in breach of any of its
Obligations under this Lease.
EXCEPTION TO LIMITATION ON DISTRIBUTIONS
8.7. NOTWITHSTANDING CLAUSE 8.6 THE LESSEE MAY MAKE DISTRIBUTIONS OF INCOME
FROM THE TRUST WITH THE PRIOR WRITTEN CONSENT OF THE LESSOR WHICH WILL
NOT BE WITHHELD IF THE AMOUNT OF THE DISTRIBUTION IS IMMEDIATELY
REPLACED BY A LOAN OF CASH WHICH IS SUBORDINATED TO THE RIGHTS OF THE
LESSOR UNDER A WRITTEN SUBORDINATION AGREEMENT IN A FORM AND SUBSTANCE
ACCEPTABLE TO THE LESSOR ACTING REASONABLY.
9. MAINTENANCE AND REPAIR
MAINTENANCE OF THE LEASED PROPERTY
9.1. THE LESSEE, AT ITS EXPENSE, WILL KEEP THE LEASED PROPERTY AND ALL
SERVICES, FACILITIES, LANDSCAPING, PRIVATE ROADWAYS, PAVEMENTS AND
KERBS APPURTENANT TO THE LEASED PROPERTY AND WHICH ARE UNDER THE
LESSEE'S CONTROL AND THE LESSEE'S PERSONAL PROPERTY AND THE EXCLUDED
<PAGE> 33
PERSONAL PROPERTY IN GOOD AND SUBSTANTIAL REPAIR AND CONDITION
INCLUDING REBUILDING OF THE WHOLE OF THE LEASED PROPERTY WHERE
NECESSARY (WHETHER OR NOT THE NEED FOR SUCH REPAIRS OCCURS AS A RESULT
OF THE LESSEE'S USE, ANY PRIOR USE, THE ELEMENTS OR THE AGE OF THE
LEASED PROPERTY, OR ANY PORTION OF THE LEASED PROPERTY OR AS A RESULT
OF ANY LATENT OR INHERENT DEFECTS OR ANY CAUSE WHATEVER).
CAPITAL IMPROVEMENTS
9.2. THE LESSEE SHALL MAKE THE STRUCTURAL AND CAPITAL IMPROVEMENTS TO THE
LEASED PROPERTY REQUIRED BY CLAUSE 8.5 IN ACCORDANCE WITH ANNUAL
CAPITAL BUDGETS TO BE PREPARED BY THE LESSEE AND SUBMITTED TO THE
LESSOR BY 1 JUNE OF EACH LEASE YEAR AND APPROVED BY THE LESSOR (SUCH
APPROVAL NOT TO BE UNREASONABLY WITHHELD OR DELAYED). IF A CAPITAL
BUDGET IS NOT SO APPROVED THE LESSEE SHALL WITHIN 14 DAYS SUBMIT A
REVISED VERSION WHICH PROCEDURE SHALL BE REPEATED AS OFTEN AS MAY BE
NECESSARY.
REPAIR QUALITY
9.3. ALL REPAIRS SHALL, TO THE EXTENT REASONABLY ACHIEVABLE, BE AT LEAST
EQUIVALENT IN QUALITY TO THE ORIGINAL WORK, AND, SUBJECT TO THE
PROVISIONS OF CLAUSE 9.11, WHERE, BY REASON OF AGE OR CONDITION, SUCH
REPAIRS CANNOT BE MADE TO THE QUALITY OF THE ORIGINAL WORK, THE
PROPERTY TO BE REPAIRED SHALL BE REPLACED.
PAINT
9.4. AS OFTEN AS SHALL BE NECESSARY THE LESSEE WILL PAINT THOSE PARTS OF THE
EXTERIOR AND INTERIOR OF EACH FACILITY WHICH HAVE BEEN PREVIOUSLY
PAINTED OR ARE REQUIRED TO BE PAINTED. THE LESSOR SHALL HAVE THE RIGHT
(ACTING REASONABLY) TO DETERMINE WHEN IT IS NECESSARY TO PAINT EACH
FACILITY.
NOTICE TO LESSEE
9.5. THE LESSEE SHALL WITHIN 3 MONTHS (OR SUCH LONGER PERIOD AS THE LESSOR
SHALL ALLOW HAVING REGARD TO THE WORKS REQUIRED TO REMEDY THE
<PAGE> 34
DISREPAIR OR BREACH OF COVENANT OR CONDITION) AFTER SERVICE UPON THE
LESSEE OF NOTICE OF ANY DISREPAIR OR BREACH OF COVENANT OR CONDITION
FOR WHICH THE LESSEE IS LIABLE UNDER THIS LEASE (OR IMMEDIATELY IN CASE
OF NEED) MAKE GOOD THE SAME.
SHORING
9.6. THE LESSEE SHALL DO OR CAUSE OTHERS TO DO ALL REASONABLY REQUIRED
SHORING OF THE LEASED PROPERTY OR ADJOINING PROPERTY (WHETHER OR NOT
OWNED BY THE LESSOR) OR OF THE FOUNDATIONS AND WALLS OF THE LEASED
PROPERTY, AND EVERY OTHER ACT NECESSARY OR APPROPRIATE FOR THE
PRESERVATION AND SAFETY OF THE LEASED PROPERTY, BY REASON OF OR IN
CONNECTION WITH ANY SUBSIDENCE, SETTLING OR EXCAVATION OR OTHER
BUILDING OPERATION UPON ANY OF THE LEASED PROPERTY OR ADJOINING
PROPERTY.
LEVEL OF MAINTENANCE
9.7. IT IS THE INTENTION OF THE PROVISIONS OF THIS CLAUSE 9 THAT THE LEVEL
OF MAINTENANCE OF THE LEASED PROPERTY SHALL BE NOT LESS THAN THAT
NECESSARY TO MAINTAIN EACH FACILITY FOR THE PRIMARY INTENDED USE IN A
MANNER REQUIRED BY THE ESSENTIAL LEGISLATION AND CONSISTENT WITH THE
GENERALLY ACCEPTED STANDARDS OF GOOD MAINTENANCE APPLIED IN OTHER
FACILITIES OF A SIMILAR NATURE FOR THE PRIMARY INTENDED USE IN THE
LOCALITY OF THAT FACILITY AND BROADLY IN THE SAME MARKET SECTOR AS THAT
FACILITY.
LESSOR NOT LIABLE FOR REPAIRS ETC
9.8. THE LESSOR SHALL NOT UNDER ANY CIRCUMSTANCES BE REQUIRED TO BUILD OR
REBUILD ANY IMPROVEMENTS ON THE LEASED PROPERTY, OR TO MAKE ANY
REPAIRS, REPLACEMENTS, ALTERATIONS, RESTORATIONS OR RENEWALS OF ANY
NATURE OR DESCRIPTION TO THE LEASED PROPERTY, WHETHER ORDINARY OR
EXTRAORDINARY, STRUCTURAL OR NONSTRUCTURAL, FORESEEN OR UNFORESEEN, OR
UPON ANY ADJOINING PROPERTY, WHETHER TO PROVIDE LATERAL OR OTHER
SUPPORT FOR THE LEASED PROPERTY OR ABATE A NUISANCE AFFECTING THE
LEASED PROPERTY, OR OTHERWISE, OR TO MAKE ANY
<PAGE> 35
EXPENDITURE WHATSOEVER WITH RESPECT TO THE LEASED PROPERTY, IN
CONNECTION WITH THIS LEASE, OR TO MAINTAIN THE LEASED PROPERTY IN ANY
WAY.
LESSEE WAIVER
9.9. THE LESSEE WAIVES, TO THE EXTENT PERMITTED BY LAW, THE RIGHT TO MAKE
REPAIRS OR TO EXECUTE OTHER WORKS AT THE EXPENSE (IN WHOLE OR PART) OF
THE LESSOR (OR TO REQUIRE THE LESSOR TO EXECUTE THE SAME) UNDER ANY LAW
IN EFFECT AT THE TIME OF THE EXECUTION OF THIS LEASE OR IN FUTURE
ENACTED.
LESSOR NOT CONTRACTING PARTY
9.10. NOTHING CONTAINED IN THIS LEASE SHALL BE CONSTRUED AS:
9.10.1. CONSTITUTING THE CONSENT OR REQUEST OF THE LESSOR, EXPRESSED
OR IMPLIED, TO ANY CONTRACTOR, SUBCONTRACTOR, LABOURER,
SUPPLIER OR VENDOR TO OR FOR THE PERFORMANCE OF ANY LABOUR OR
SERVICES OR THE FURNISHING OF ANY MATERIALS OR OTHER PROPERTY
FOR THE CONSTRUCTION, ALTERATION, ADDITION, REPAIR OR
DEMOLITION OF THE LEASED PROPERTY OR ANY PART THEREOF; OR
9.10.2. GIVING THE LESSEE ANY RIGHT, POWER OR PERMISSION TO CONTRACT
FOR OR PERMIT THE PERFORMANCE OF ANY LABOUR OR SERVICES OR THE
FURNISHING OF ANY MATERIALS OR OTHER PROPERTY IN SUCH FASHION
AS WOULD PERMIT THE MAKING OF ANY CLAIM AGAINST THE LESSOR IN
RESPECT THEREOF OR TO MAKE ANY AGREEMENT THAT MAY CREATE, OR
IN ANY WAY BE THE BASIS FOR ANY RIGHT, TITLE, INTEREST, LIEN,
CLAIM OR OTHER ENCUMBRANCE UPON THE TITLE OF THE LESSOR TO THE
LEASED PROPERTY, OR ANY PORTION THEREOF.
REPLACEMENT PROPERTY
9.11. THE LESSEE SHALL FROM TIME TO TIME AS REQUIRED (INCLUDING AS REQUIRED
PURSUANT TO ANY LEGAL REQUIREMENTS) REPLACE THE REPLACED PROPERTY WITH
THE REPLACEMENT PROPERTY PROVIDED, HOWEVER, THAT THE
<PAGE> 36
REPLACEMENT PROPERTY SHALL:
9.11.1. BE IN GOOD OPERATING CONDITION;
9.11.2. HAVE A THEN VALUE (AS ADJUSTED FOR INFLATION BY REFERENCE TO
MOVEMENTS IN THE CONSUMER PRICE INDEX) AND USEFUL LIFE AT
LEAST EQUAL TO THE VALUE AND ESTIMATED USEFUL LIFE OF THE
REPLACED PROPERTY AS OF THE DATE HEREOF FOR REPLACED PROPERTY
SPECIFIED ABOVE), OR HAVE A VALUE AND USEFUL LIFE AT LEAST
EQUAL TO THE VALUE AND ESTIMATED USEFUL LIFE OF THE REPLACED
PROPERTY IMMEDIATELY BEFORE THE TIME THAT SUCH REPLACED
PROPERTY SHALL HAVE BEEN REQUIRED TO BE REPLACED IN ACCORDANCE
WITH THESE PROVISIONS; AND
9.11.3. BE SUITABLE FOR A USE WHICH IS THE SAME OR SIMILAR TO THAT OF
THE REPLACED PROPERTY.
THE LESSEE SHALL REPAIR AT ITS SOLE COST AND EXPENSE ALL DAMAGE TO THE
LEASED PROPERTY CAUSED BY THE REMOVAL OF REPLACED PROPERTY OR THE
INSTALLATION OF REPLACEMENT PROPERTY. ALL REPLACEMENT PROPERTY SHALL
BECOME THE PROPERTY OF THE LESSOR AND SHALL BECOME A PART OF THE
FIXTURES OR THE LESSOR'S PERSONAL PROPERTY, AS THE CASE MAY BE, TO THE
SAME EXTENT AS THE REPLACED PROPERTY HAD BEEN. THE LESSEE SHALL
PROMPTLY ADVISE THE LESSOR OF ALL SUCH REPLACEMENT PROPERTY, AND IF SO
REQUESTED BY THE LESSOR IN WRITING, THE LESSEE SHALL PROMPTLY CAUSE TO
BE EXECUTED AND DELIVERED TO THE LESSOR AN INVOICE, BILL OF SALE OR
OTHER APPROPRIATE INSTRUMENT EVIDENCING THE TRANSFER OR ASSIGNMENT TO
THE LESSOR OF ALL ESTATE, RIGHT, TITLE AND INTEREST (OTHER THAN THE
LEASEHOLD ESTATE CREATED BY THIS LEASE) OF THE LESSEE OR ANY OTHER
PERSON IN AND TO THE REPLACEMENT PROPERTY, FREE FROM ALL LIENS AND
OTHER EXCEPTIONS TO TITLE AND ENCUMBRANCES, AND THE LESSEE SHALL PAY
ALL TAXES, FEES, COSTS AND OTHER EXPENSES THAT MAY BECOME PAYABLE AS A
RESULT THEREOF.
YIELD UP
9.12. UNLESS THE LESSOR TRANSFERS THE LEASED PROPERTY TO THE LESSEE UNDER
THIS
<PAGE> 37
LEASE, THE LESSEE WILL, UPON THE EXPIRATION OR PRIOR TERMINATION OF THE
TERM, VACATE AND YIELD UP THE LEASED PROPERTY TO THE LESSOR IN ALL
MATERIAL RESPECTS IN SUCH CONDITION AS IS CONSISTENT WITH THE LESSEE'S
REPAIRING COVENANTS SET OUT IN CLAUSE 9.1 AND THE LESSEE'S OBLIGATION
IN CLAUSE 8.5 EXCEPT AS PERMITTED OR REQUIRED BY THE PROVISIONS OF THIS
LEASE, IN FULL COMPLIANCE WITH ALL COVENANTS AND PROVISIONS OF THIS
LEASE FREE FROM ANY ENCUMBRANCE.
ENCROACHMENTS
9.13. IF ANY FACILITY, AT ANY TIME, ENCROACHES UPON ANY PROPERTY, STREET OR
RIGHT-OF-WAY ADJACENT TO THAT FACILITY, OR VIOLATES THE AGREEMENTS OR
CONDITIONS CONTAINED IN ANY LAWFUL RESTRICTIVE COVENANT OR OTHER
AGREEMENT AFFECTING THAT FACILITY, OR ANY PART THEREOF, OR IMPAIRS THE
RIGHTS OF OTHERS UNDER ANY EASEMENT OR RIGHT-OF-WAY TO WHICH THAT
FACILITY IS SUBJECT, THEN PROMPTLY UPON THE REQUEST OF THE LESSOR OR AT
THE BEHEST OF ANY PERSON AFFECTED BY ANY SUCH ENCROACHMENT, VIOLATION
OR IMPAIRMENT, THE LESSEE SHALL, AT ITS EXPENSE, SUBJECT TO ITS RIGHT
TO CONTEST THE EXISTENCE OF ANY ENCROACHMENT, VIOLATION OR IMPAIRMENT
AS PROVIDED IN PART 12 AND IN SUCH CASE, IN THE EVENT OF AN ADVERSE
FINAL DETERMINATION, EITHER:
9.13.1. OBTAIN VALID AND EFFECTIVE WAIVERS OR SETTLEMENTS OF ALL
CLAIMS, LIABILITIES AND DAMAGES RESULTING FROM EACH SUCH
ENCROACHMENT, VIOLATION OR IMPAIRMENT, WHETHER THE SAME SHALL
AFFECT THE LESSOR OR THE LESSEE; OR
9.13.2. MAKE SUCH CHANGES IN THAT FACILITY, AND TAKE SUCH OTHER
ACTIONS, AS THE LESSEE IN THE GOOD FAITH EXERCISE OF ITS
JUDGMENT DEEMS REASONABLY PRACTICABLE, TO REMOVE SUCH
ENCROACHMENT, AND TO END SUCH VIOLATION OR IMPAIRMENT,
INCLUDING, IF NECESSARY, THE ALTERATION OF THAT FACILITY, AND
IN ANY EVENT TAKE ALL SUCH ACTIONS AS MAY BE NECESSARY IN
ORDER TO BE ABLE TO CONTINUE THE OPERATION OF THAT FACILITY
FOR THE PRIMARY INTENDED USE SUBSTANTIALLY IN THE MANNER AND
TO THE
<PAGE> 38
EXTENT THAT FACILITY WAS OPERATED BEFORE THE ASSERTION OF SUCH
VIOLATION, IMPAIRMENT OR ENCROACHMENT.
THE LESSEE MAY OFFER THE LESSOR A FULL INDEMNITY IN RESPECT OF ANY SUCH
MATTERS BY WAY OF REMEDY WHICH THE LESSOR MAY IN ITS ABSOLUTE
DISCRETION ACCEPT OR REFUSE BY WAY OF DISCHARGE OF THE LESSEE'S
OBLIGATIONS UNDER THIS CLAUSE. THE LESSEE SHALL NOT HAVE ANY CLAIM OR
SET OFF OR DEDUCTION OR COUNTERCLAIM WITH RESPECT TO ANY SUCH
VIOLATION, IMPAIRMENT OR ENCROACHMENT. ANY ALTERATION MUST BE MADE IN
CONFORMITY WITH THE APPLICABLE REQUIREMENTS OF PART 10.
10. ALTERATIONS AND ADDITIONS
ALTERATIONS REQUIRED BY LAW
10.1. THE LESSEE SHALL NOT MAKE ANY STRUCTURAL OR EXTERNAL ALTERATIONS,
IMPROVEMENTS OR ADDITIONS TO THE LEASED PROPERTY OR ANY PART THEREOF
EXCEPT SUCH AS MAY BE REQUIRED BY ANY LEGAL REQUIREMENT OR FOR THE
PROPER PERFORMANCE OF THE OBLIGATIONS.
OTHER ALTERATIONS
10.2. THE LESSEE SHALL NOT MAKE OR PERMIT TO BE MADE ANY INTERNAL
NONSTRUCTURAL ALTERATIONS, IMPROVEMENTS OR ADDITIONS OR ANY STRUCTURAL
OR EXTERNAL ALTERATIONS IMPROVEMENTS OR ADDITIONS (NOT BEING PROHIBITED
BY CLAUSE 10.1) OF OR TO THE LEASED PROPERTY OR ANY PART THEREOF,
UNLESS AND UNTIL THE LESSEE HAS CAUSED PLANS AND SPECIFICATIONS TO HAVE
BEEN PREPARED, AT THE LESSEE'S EXPENSE, BY A QUALIFIED ARCHITECT (SAVE
FOR MINOR NONSTRUCTURAL ALTERATIONS, IMPROVEMENTS OR ADDITIONS WHICH
HAVE A FINANCIAL VALUE OF LESS THAN $50,000 IN WHICH CASE ARCHITECT
PLANS NEED NOT BE PROVIDED TO THE LESSOR UNLESS THE LESSOR REASONABLY
SO REQUESTS) AND HAS OBTAINED THE LESSOR'S PRIOR WRITTEN APPROVAL TO
SUCH PLANS AND SPECIFICATIONS (WHICH APPROVAL SHALL NOT BE UNREASONABLY
WITHHELD OR DELAYED) AND WILL IN ANY EVENT BE GRANTED (SUBJECT TO SUCH
CONDITIONS AS THE LESSOR MAY REASONABLY REQUIRE) FOR ANY ALTERATIONS
REQUIRED BY ANY LEGAL
<PAGE> 39
REQUIREMENT OR INSURANCE REQUIREMENT OR TO MAINTAIN THE REGISTRATION OF
A FACILITY IN COMPLIANCE WITH THE LESSEE'S COVENANTS HEREUNDER).
COST LESS THAN $50,000
10.3. IF THE ESTIMATED COST OF THE ALTERATION, IMPROVEMENT OR ADDITION IS
LESS THAN $50,000 (EXCLUSIVE OF ANY GST PAYABLE THEREON), THE LESSEE
SHALL GIVE THE LESSOR AT LEAST 15 BUSINESS DAYS NOTICE OF SUCH PLANNED
ALTERATION, IMPROVEMENT OR ADDITION IN ADVANCE OF THE COMMENCEMENT OF
CONSTRUCTION.
COST EXCEEDS $300,000
10.4. IF THE ESTIMATED COST OF THE ALTERATION, IMPROVEMENT OR ADDITION IS OR
EXCEEDS $300,000 THEN THE LESSEE SHALL DEPOSIT WITH THE LESSOR AN
AMOUNT EQUAL TO THE ESTIMATED COST OF THE ALTERATION, IMPROVEMENT OR
ADDITION OR SHALL PROVIDE THE LESSOR WITH EVIDENCE (IF SATISFACTORY TO
THE LESSOR) OF THE AVAILABILITY TO THE LESSEE OF THE FUNDS FOR SUCH
WORK. IF THE LESSEE DEPOSITS THE FUNDS, THE LESSOR SHALL RETAIN THESE
FUNDS IN AN INTEREST BEARING ACCOUNT IN THE JOINT NAMES OF THE LESSOR
AND THE LESSEE BUT UNDER THE SOLE CONTROL OF THE LESSOR AND PAY SUCH
INTEREST REASONABLY AS IT IS ACTUALLY RECEIVED (NET OF ANY DEDUCTION BY
THE BANK) ON THE BALANCE DEPOSITED TO THE LESSEE AND DISBURSE THE
AMOUNT SO DEPOSITED IN THE SAME MANNER AS IS PROVIDED FOR INSURANCE
PROCEEDS IN PART 14 OF THIS LEASE.
DEPOSIT INSUFFICIENT
10.5. IF THE DEPOSIT IS DETERMINED BY THE LESSOR AT ANY TIME TO BE
INSUFFICIENT FOR THE COMPLETION OF THE ADDITION, IMPROVEMENT OR
ALTERATION, THE LESSEE SHALL IMMEDIATELY DEPOSIT WITH THE LESSOR ANY
DEFICIENCY TO BE HELD AND DISBURSED BY THE LESSOR AS PROVIDED FOR
HEREIN.
TERMINATION BEFORE ALTERATIONS
10.6. IF THIS LEASE IS TERMINATED WITHOUT THE ALTERATIONS OR ADDITION HAVING
BEEN COMMENCED THE FUNDS WILL BE REFUNDED TO THE LESSEE WITH THE
<PAGE> 40
ACCRUED INTEREST. ON COMPLETION OF THE ALTERATIONS OR ADDITION THE
FUNDS AND INTEREST NOT PROPERLY DISBURSED SHALL BE PAID TO THE LESSEE.
WORK TO BE PERFORMED IN WORKMANLIKE MANNER ETC
10.7. THE LESSEE SHALL ENSURE THAT ANY WORK CARRIED OUT BY THE LESSEE TO THE
LEASED PROPERTY (INCLUDING WORK UNDER THIS CLAUSE 10):
10.7.1. IS DONE IN ACCORDANCE WITH THE RELEVANT PLANS AND
SPECIFICATIONS APPROVED BY THE LESSOR (PROVIDED THAT SUCH
APPROVAL SHALL NOT BE UNREASONABLY WITHHELD OR DELAYED);
10.7.2. IS DONE AT THE LESSEE'S EXPENSE;
10.7.3. IS DONE PROMPTLY, AND IN A FIRST CLASS WORKMANLIKE MANNER BY A
CONTRACTOR APPROVED BY THE LESSOR (PROVIDED THAT SUCH APPROVAL
SHALL NOT BE UNREASONABLY WITHHELD OR DELAYED);
10.7.4. SHALL CONSTITUTE A COMPLETE ARCHITECTURAL UNIT IN KEEPING WITH
THE CHARACTER OF THE RELEVANT FACILITY AND THE AREA IN WHICH
THE LEASED PROPERTY IS LOCATED;
10.7.5. IS DONE IN ACCORDANCE WITH ALL LEGAL REQUIREMENTS AND THE
REASONABLE REQUIREMENTS AND DIRECTIONS OF THE LESSOR;
10.7.6. WILL NOT DIMINISH THE VALUE OF THE RELEVANT FACILITY OR CHANGE
THE PRIMARY INTENDED USE OF THE RELEVANT FACILITY.
LESSOR TO OWN
10.8. EACH AND EVERY SUCH IMPROVEMENT, ALTERATION OR ADDITION SHALL
IMMEDIATELY BECOME A PART OF THE LEASED PROPERTY AND SHALL BELONG TO
THE LESSOR SUBJECT TO THE TERMS AND CONDITIONS OF THIS LEASE.
<PAGE> 41
11. ENCUMBRANCES
11.1. SUBJECT TO THE PROVISIONS OF PART 12, THE LESSEE WILL NOT DIRECTLY OR
INDIRECTLY CREATE OR ALLOW TO REMAIN AND WILL PROMPTLY DISCHARGE AT ITS
EXPENSE ANY LIEN, ENCUMBRANCE, ATTACHMENT, TITLE RETENTION AGREEMENT OR
CLAIM UPON THE LEASED PROPERTY OR ANY ATTACHMENT, LEVY, CLAIM OR
ENCUMBRANCE IN RESPECT OF THE RENT, NOT INCLUDING, HOWEVER:
11.1.1. THIS LEASE;
11.1.2. THE MATTERS, IF ANY, SET FORTH IN SCHEDULE 3;
11.1.3. RESTRICTIONS, LIENS AND OTHER ENCUMBRANCES WHICH ARE PERMITTED
BY THE TERMS OF THIS LEASE OR ARE CONSENTED TO IN WRITING BY
THE LESSOR BEFORE REGISTRATION AND THE FACILITY MORTGAGEE OR
ANY EASEMENTS GRANTED BY OR CONSENTED TO IN WRITING BY THE
LESSOR;
11.1.4. LIENS FOR THOSE TAXES OF THE LESSOR WHICH THE LESSEE IS NOT
REQUIRED TO PAY UNDER THIS LEASE;
11.1.5. LIENS FOR OUTGOINGS OR FOR SUMS RESULTING FROM NONCOMPLIANCE
WITH LEGAL REQUIREMENTS SO LONG AS:
11.1.5.1. the same are not yet payable; or
11.1.5.2. such liens are in the process of being contested as
permitted by Part 12;
11.1.6. LIENS OF MECHANICS, LABOURERS, MATERIAL MEN, SUPPLIERS OR
VENDORS FOR SUMS EITHER DISPUTED OR NOT YET DUE, PROVIDED
THAT:
11.1.6.1. the payment of such sums shall not be postponed
under any related contract for more than 60 days
after the completion of the action giving rise to
such lien and such reserve or other appropriate
provisions as shall be required by law or generally
accepted accounting principles shall have been made
therefor or;
<PAGE> 42
11.1.6.2. any such liens are in the process of being
contested as permitted by Part 12 and during the
period of such contest payment may lawfully be
delayed for more than 60 days;
11.1.7. ANY ENCUMBRANCES CREATED BY THE LESSOR OR WHICH RELATE TO DEBT
OR OTHER INDEBTEDNESS OF THE LESSOR OR ANY OF ITS ASSOCIATED
COMPANIES; AND
11.1.8. SECURITY GRANTED OVER THIS LEASE FOR THE REPAYMENT OF BORROWED
MONEY TO ASSIST IN THE OPERATION OF THE FACILITY AND THE
MAKING OF ANY ALTERATIONS OR ADDITIONS OF THE TYPE
CONTEMPLATED BY THIS LEASE.
12. PERMITTED CONTESTS
LESSEE MAY CONTEST
12.1. THE LESSEE MAY, ON ITS OWN (OR ON THE LESSOR'S BEHALF OR IN THE
LESSOR'S NAME), BUT AT THE LESSEE'S SOLE COST AND EXPENSE, CONTEST, BY
APPROPRIATE LEGAL PROCEEDINGS CONDUCTED IN GOOD FAITH AND WITH DUE
DILIGENCE, THE AMOUNT OR VALIDITY OF ANY OUTGOING OR ANY LEGAL
REQUIREMENT OR INSURANCE REQUIREMENT OR ANY LIEN, ATTACHMENT, LEVY,
ENCUMBRANCE, CHARGE OR CLAIM, OR ANY ENCROACHMENT OR RESTRICTION
BURDENING THE LEASED PROPERTY ("CLAIMS") NOT OTHERWISE PERMITTED BY
PART 11, (BUT THIS SHALL NOT BE DEEMED OR CONSTRUED IN ANY WAY AS
RELIEVING, MODIFYING OR EXTENDING THE LESSEE'S COVENANTS TO PAY OR ITS
COVENANTS TO CAUSE TO BE PAID ANY SUCH CHARGES AT THE TIME AND IN THE
MANNER PROVIDED IN THIS PART 12).
LESSEE NOT RELIEVED
12.2. LEGAL PROCEEDINGS UNDER CLAUSE 12.1 SHALL NOT OPERATE TO RELIEVE THE
LESSEE FROM ITS OBLIGATIONS UNDER THIS LEASE AND THE LESSEE MUST NOT
CAUSE OR ALLOW THE SALE OF THE LEASED PROPERTY, OR ANY PART THEREOF, TO
SATISFY THE SAME OR CAUSE THE LESSOR OR THE LESSEE TO BE IN DEFAULT
UNDER ANY ENCUMBRANCE OR IN VIOLATION OF ANY LEGAL REQUIREMENTS OR
INSURANCE REQUIREMENTS UPON THE LEASED PROPERTY OR ANY INTEREST
THEREIN.
<PAGE> 43
LESSEE TO PROVIDE BOND OR DEPOSIT
12.3. UPON REQUEST OF THE LESSOR, THE LESSEE SHALL EITHER:
12.3.1. PROVIDE A BOND, LETTER OF CREDIT OR OTHER ASSURANCE REASONABLY
SATISFACTORY TO THE LESSOR THAT ALL CLAIMS WHICH MAY BE
ASSESSED AGAINST THE LEASED PROPERTY TOGETHER WITH INTEREST,
COSTS AND PENALTIES, IF ANY, THEREON WILL BE PAID; OR
12.3.2. DEPOSIT WITHIN THE TIME OTHERWISE REQUIRED FOR PAYMENT WITH A
BANK OR TRUST COMPANY SELECTED BY THE LESSOR AS TRUSTEE, AS
SECURITY FOR THE PAYMENT OF SUCH CLAIMS, MONEY IN AN AMOUNT
SUFFICIENT TO PAY THE SAME, TOGETHER WITH INTEREST, COSTS AND
PENALTIES IN CONNECTION THEREWITH AND ALL CLAIMS WHICH MAY BE
ASSESSED AGAINST OR BECOME A CLAIM ON THE LEASED PROPERTY, OR
ANY PART THEREOF, IN THE LEGAL PROCEEDINGS.
EVIDENCE OF DEPOSIT
12.4. THE LESSEE SHALL FURNISH THE LESSOR AND ANY FACILITY MORTGAGEE AND ANY
OTHER PARTY ENTITLED TO ENFORCE ANY LEGAL REQUIREMENTS OR INSURANCE
REQUIREMENTS WITH SUCH EVIDENCE OF SUCH DEPOSIT AS THEY MAY REASONABLY
REQUIRE WITHIN 5 DAYS OF SUCH DEPOSIT UNDER CLAUSE 12.3. THE LESSOR
AGREES TO JOIN IN ANY SUCH PROCEEDINGS IF THE SAME ARE REQUIRED TO
LEGALLY PROSECUTE SUCH CONTEST OF THE VALIDITY OF SUCH CLAIMS. THE
LESSOR SHALL NOT BY SO DOING BE SUBJECTED TO ANY LIABILITY FOR THE
PAYMENT OF ANY COSTS OR EXPENSES IN CONNECTION WITH ANY PROCEEDINGS
UNDER CLAUSE 12.1 AND THE LESSEE COVENANTS TO INDEMNIFY AND SAVE
HARMLESS THE LESSOR FROM ANY SUCH COSTS OR EXPENSES, INCLUDING BUT NOT
LIMITED TO REASONABLE LEGAL FEES INCURRED IN ANY ARBITRATION OR
MEDIATION PROCEEDING, TRIAL, APPEAL AND POST-JUDGMENT ENFORCEMENT
PROCEEDINGS. THE LESSEE SHALL BE ENTITLED TO ANY REFUND
<PAGE> 44
OF ANY CLAIMS AND SUCH CHARGES AND PENALTIES OR INTEREST THEREON WHICH
HAVE BEEN PAID BY THE LESSEE OR PAID BY THE LESSOR AND FOR WHICH THE
LESSOR HAS BEEN FULLY REIMBURSED.
LESSOR MAY SATISFY IN DEFAULT
12.5. IF THE LESSEE FAILS TO PAY OR SATISFY THE REQUIREMENTS OR CONDITIONS OF
ANY CLAIMS WHEN DUE OR TO PROVIDE THE SECURITY THEREFOR AS PROVIDED IN
THIS CLAUSE AND TO DILIGENTLY PROSECUTE ANY CONTEST OF THE SAME, THE
LESSOR MAY, UPON 30 DAYS' ADVANCE WRITTEN NOTICE TO THE LESSEE, PAY OR
SATISFY SUCH CLAIMS TOGETHER WITH ANY INTEREST AND PENALTIES AND THE
SAME (OR THE COST THEREOF) SHALL BE REPAYABLE BY THE LESSEE TO THE
LESSOR FORTHWITH AS ADDITIONAL CHARGES. IF THE LESSOR REASONABLY
DETERMINES THAT THE GIVING OF SUCH NOTICE WOULD RISK LOSS TO THE LEASED
PROPERTY OR CAUSE DAMAGE TO THE LESSOR, THEN THE LESSOR SHALL GIVE SUCH
WRITTEN NOTICE AS IS PRACTICAL UNDER THE CIRCUMSTANCES.
FURTHER DEPOSIT
12.6. AT ANY TIME AFTER AN EVENT OF DEFAULT HAS OCCURRED (AND IF REMEDIABLE
HAS NOT BEEN CURED) THE LESSOR, IN ITS SOLE DISCRETION, SHALL BE
ENTITLED TO REQUIRE THE LESSEE TO PAY MONTHLY A PRO RATA PORTION OF THE
AMOUNTS REQUIRED TO COMPLY WITH THE INSURANCE REQUIREMENTS, ANY
OUTGOING AND ANY LEGAL REQUIREMENTS, AND WHEN SUCH OBLIGATIONS BECOME
DUE, THE LESSOR SHALL PAY THEM (TO THE EXTENT OF THE DEPOSIT) UPON
NOTICE FROM THE LESSEE REQUESTING SUCH PAYMENT. IF SUFFICIENT FUNDS
HAVE NOT BEEN DEPOSITED TO COVER THE AMOUNT OF THE OBLIGATIONS DUE AT
LEAST 30 DAYS BEFORE THE DUE DATE, THE LESSEE SHALL FORTHWITH DEPOSIT
THE SAME WITH THE LESSOR UPON WRITTEN REQUEST FROM THE LESSOR WHICH
SHALL ACCOUNT TO THE LESSEE FOR INTEREST THEREON IN THE MANNER REFERRED
TO IN PART 10 ABOVE.
LESSOR TO APPLY FUNDS
12.7. UPON AN EVENT DEFAULT UNDER THIS LEASE, ANY OF THE FUNDS REMAINING ON
DEPOSIT MAY BE APPLIED UNDER THIS LEASE, IN ANY MANNER AND ON SUCH
PRIORITY, AS DETERMINED BY THE LESSOR AND WITHOUT NOTICE TO THE LESSEE
AND ACCOUNTED FOR AS A PAYMENT MADE BY THE LESSEE FOR THE LESSOR.
<PAGE> 45
13. INSURANCE
LESSEE TO INSURE
13.1. DURING THE TERM THE LESSEE SHALL AT ALL TIMES KEEP THE LEASED
PROPERTY, AND ALL PROPERTY LOCATED IN OR ON THE LEASED
PROPERTY, INCLUDING THE LESSOR'S PERSONAL PROPERTY AND THE
LESSEE'S PERSONAL PROPERTY, INSURED WITH THE KINDS AND AMOUNTS
OF INSURANCE DESCRIBED THIS CLAUSE 13.
LESSOR MAY INSURE
13.2. THE LESSOR MAY, BY NOTICE TO THE LESSEE, INSURE OR PROCURE
INSURANCE ON BEHALF OF AND IN THE NAME OF THE LESSEE AND THE
LESSOR AND SUCH OTHERS AS THE LESSOR MAY REQUIRE IN THE SAME
MANNER AND ON THE SAME TERMS AS THE LESSEE IS REQUIRED TO
INSURE UNDER THIS LEASE AND IN SUCH CIRCUMSTANCES:
13.2.1. THE LESSEE SHALL PAY THE PREMIUM FOR THE SAME (OR ANY
INCREASED PREMIUMS) TO THE LESSOR OR DIRECTLY TO THE
INSURER OR THE INSURANCE BROKER AS MAY BE DIRECTED BY
THE LESSOR ON DEMAND;
13.2.2. ALL OTHER OBLIGATIONS RELATING TO SUCH INSURANCE
(INCLUDING FOR THE AVOIDANCE OF DOUBT DEALING WITH
THE INSURANCE PROCEEDS AND THE LESSEE'S OBLIGATIONS
REGARDING RESTORATION) SHALL REMAIN WITH THE LESSEE
OR THE LESSOR AS SPECIFIED IN THIS LEASE;
13.2.3. THIS INSURANCE SHALL BE WRITTEN BY REPUTABLE
COMPANIES APPROVED BY THE LESSOR AND THE LESSOR SHALL
BE ENTITLED TO RETAIN FOR ITS OWN BENEFIT ANY
COMMISSION PAID OR ALLOWED BY THE INSURERS;
<PAGE> 46
13.2.4. ALL SUCH POLICIES PROVIDED AND MAINTAINED DURING THE
TERM SHALL BE PLACED WITH AN INSURANCE OFFICE OF GOOD
REPUTE HAVING ITS PRINCIPAL PLACE OF BUSINESS IN
AUSTRALIA;
13.2.5. THE POLICIES MUST NAME THE LESSOR AS AN ADDITIONAL
INSURED.
PAYMENT OF LOSSES
13.3. LOSSES SHALL BE PAYABLE TO THE LESSOR OR THE LESSEE AS PROVIDED IN PART
14. IN ADDITION, THE POLICIES SHALL NAME AS AN ADDITIONAL INSURED ANY
FACILITY MORTGAGEE AND MUST BE IN ACCORDANCE WITH ANY SUCH OTHER
REQUIREMENTS AS MAY BE ESTABLISHED BY THE FACILITY MORTGAGEE.
LOSS ADJUSTMENT
13.4. ANY LOSS ADJUSTMENT OF AN AMOUNT IN EXCESS OF $250,000 SHALL REQUIRE
THE WRITTEN CONSENT OF THE LESSOR, THE LESSEE, AND THE FACILITY
MORTGAGEE, WHICH CONSENT SHALL NOT BE UNREASONABLY WITHHELD BY EITHER
THE LESSOR OR THE LESSEE. EVIDENCE OF INSURANCE (INCLUDING EVIDENCE OF
TIMELY RENEWAL THEREOF) SHALL BE DEPOSITED WITH THE LESSOR AND, IF
REQUESTED, WITH THE FACILITY MORTGAGEE.
REQUISITE INSURANCE
13.5. THE REQUISITE INSURANCE REFERRED TO IN CLAUSE 13.1 IS AS FOLLOWS:
13.5.1. INSURED RISKS INCLUDING BUT NOT LIMITED TO SPRINKLER LEAKAGE,
IN AN AMOUNT NOT LESS THAN ONE HUNDRED PER CENT (100%) OF THE
THEN FULL REPLACEMENT COST THEREOF.
13.5.2. BUSINESS INTERRUPTION (INCLUDING WITHOUT LIMITATION RENT
PAYABLE FOLLOWING THE TEMPORARY OR PERMANENT CLOSURE OF ANY OF
THE LEASED PROPERTY AS A RESULT OF ANY NOTIFIABLE DISEASE
AND/OR FOLLOWING LOSS OR EXPIRATION (WITHOUT RENEWAL) OR OTHER
TERMINATION OR SUSPENSION OF ANY LICENCE CONSENT OR APPROVAL
OF OR REGISTRATION WITH COMPETENT AUTHORITY REQUIRED FOR THE
USE OF THE FACILITIES OR ANY OF THEM FOR THE PRIMARY INTENDED
USE) UNDER A BUSINESS INTERRUPTION INSURANCE POLICY COVERING
RISK OF LOSS DURING RECONSTRUCTION
<PAGE> 47
NECESSITATED BY THE OCCURRENCE OF ANY OF THE INSURED RISKS
(BUT IN NO EVENT FOR A PERIOD LESS THAN 3 YEARS) IN AN AMOUNT
SUFFICIENT TO PREVENT THE LESSOR AND THE LESSEE FROM BECOMING
A CO-INSURER. THE INSURANCE REQUIRED TO BE TAKEN OUT UNDER
THIS CLAUSE MUST FULLY RESPOND TO THE LOSS INCURRED UNTIL
RETURN TO NORMAL TRADING.
13.5.3. CLAIMS FOR PERSONAL INJURY OR PROPERTY DAMAGE UNDER A POLICY
OF COMMERCIAL BROADFORM GENERAL PUBLIC LIABILITY INSURANCE
WITH A COMBINED SINGLE LIMIT PER OCCURRENCE IN RESPECT OF
BODILY INJURY AND DEATH AND PROPERTY DAMAGE OF $50 MILLION,
AND AN AGGREGATE LIMITATION OF $50 MILLION, WHICH INSURANCE
SHALL INSURE PERFORMANCE BY THE LESSEE OF THE INDEMNITY
PROVISIONS OF PART 22 OF THIS LEASE.
13.5.4. CLAIMS ARISING OUT OF MALPRACTICE IN AN AMOUNT NOT LESS THAN
$20 MILLION IF OBTAINABLE ON REASONABLE COMMERCIAL TERMS IN
THE AUSTRALIAN INSURANCE MARKET FOR EACH PERSON AND FOR EACH
OCCURRENCE.
INSURANCE DURING ALTERATIONS ETC
13.6. DURING SUCH TIME AS THE LESSEE IS CONSTRUCTING ANY ALTERATIONS,
IMPROVEMENTS OR ADDITIONS TO THE LEASED PROPERTY, THE LESSEE, AT ITS
SOLE COST AND EXPENSE, SHALL CARRY, OR CAUSE TO BE CARRIED:
13.6.1. WORKERS' COMPENSATION INSURANCE AND EMPLOYERS' LIABILITY
INSURANCE COVERING ALL PERSONS EMPLOYED IN CONNECTION WITH THE
SAME IN STATUTORY LIMITS;
13.6.2. A COMPLETED OPERATIONS ENDORSEMENT TO THE COMMERCIAL GENERAL
LIABILITY AND PROPERTY DAMAGE INSURANCE POLICIES REFERRED TO
ABOVE (ENDORSED TO ALLOW FOR ALTERATIONS AND ADDITIONS TO THE
LEASE PROPERTY UP TO AN AMOUNT OF $1 MILLION PER CONTRACT);
13.6.3. BUILDER'S RISK INSURANCE, COMPLETED VALUE
<PAGE> 48
FORM, COVERING ALL PHYSICAL LOSS, IN AN AMOUNT SATISFACTORY TO
THE LESSOR; AND
13.6.4. A PRINCIPAL CONTROLLED CONTRACT WORKS POLICY;
13.6.5. SUCH OTHER INSURANCE, IN SUCH AMOUNTS, AS THE LESSOR
REASONABLY DEEMS NECESSARY TO PROTECT THE LESSOR'S INTEREST IN
THE LEASED PROPERTY FROM ANY ACT OR OMISSION OF THE LESSEE'S
CONTRACTORS OR SUBCONTRACTORS.
UMBRELLA COVERAGE
13.7. IF THE LESSEE CHOOSES TO CARRY UMBRELLA LIABILITY COVERAGE TO OBTAIN
THE LIMITS OF LIABILITY REQUIRED UNDER THIS LEASE, ALL SUCH POLICIES
MUST COVER IN THE SAME MANNER AS THE PRIMARY COMMERCIAL GENERAL
LIABILITY POLICY AND MUST CONTAIN NO ADDITIONAL EXCLUSIONS OR
LIMITATIONS MATERIALLY DIFFERENT FROM THOSE OF THE PRIMARY POLICY.
IMPARTIAL APPRAISER
13.8. IF THE LESSOR REASONABLY BELIEVES THE FULL REPLACEMENT COST OF THE
LEASED PROPERTY HAS INCREASED AT ANY TIME DURING THE TERM OF THIS
LEASE, IT SHALL HAVE THE RIGHT TO HAVE SUCH FULL REPLACEMENT COST
REASONABLY REDETERMINED BY THE FIRE INSURANCE COMPANY WHICH IS THEN
CARRYING THE LARGEST AMOUNT OF FIRE INSURANCE CARRIED ON THE LEASED
PROPERTY WHICH MAY APPOINT FOR SUCH PURPOSE AN INDEPENDENT PROFESSIONAL
VALUER (BEING A MEMBER OF NO LESS THAN 5 YEARS STANDING OF THE
AUSTRALIAN INSTITUTE OF VALUERS AND LAND ECONOMISTS) ("IMPARTIAL
APPRAISER").
DETERMINATION OF IMPARTIAL APPRAISER
13.9. THE DETERMINATION OF THE IMPARTIAL APPRAISER SHALL BE FINAL AND BINDING
ON THE PARTIES HERETO, AND THE LESSEE OR THE LESSOR (WHICHEVER SHALL
INSURE) SHALL FORTHWITH INCREASE, BUT NOT DECREASE, THE AMOUNT OF THE
INSURANCE CARRIED UNDER THIS PART 13, AS THE CASE MAY BE, TO THE AMOUNT
SO DETERMINED BY THE IMPARTIAL APPRAISER, SUBJECT TO THE
<PAGE> 49
APPROVAL OF THE FACILITY MORTGAGEE, AS APPLICABLE. EACH PARTY SHALL PAY
ONE-HALF OF THE FEE, IF ANY, OF THE IMPARTIAL APPRAISER.
LESSOR TO PAY IN CERTAIN CIRCUMSTANCES
13.10. IF THE LESSOR REQUIRES SUCH A VALUATION MORE THAN ONCE IN EVERY 3 YEARS
THE COST OF ANY SUCH SECOND OR SUBSEQUENT VALUATION SHALL BE BORNE
WHOLLY BY THE LESSOR.
ADDITIONAL INSURANCE
13.11. IN ADDITION TO THE INSURANCE DESCRIBED ABOVE, THE LESSEE SHALL MAINTAIN
SUCH ADDITIONAL INSURANCE AS MAY BE REQUIRED FROM TIME TO TIME BY THE
FACILITY MORTGAGEE AND SHALL AT ALL TIMES MAINTAIN ADEQUATE EMPLOYER'S
LIABILITY INSURANCE COVERAGE FOR ALL PERSONS EMPLOYED BY THE LESSEE ON
THE LEASED PROPERTY. SUCH EMPLOYER'S LIABILITY INSURANCE SHALL BE IN
ACCORDANCE WITH THE REQUIREMENTS OF APPLICABLE LEGAL REQUIREMENTS.
WAIVER OF SUBROGATION
13.12. ALL INSURANCE POLICIES CARRIED BY EITHER PARTY COVERING THE LEASED
PROPERTY, THE FIXTURES, THE FACILITY, THE LESSOR'S PERSONAL PROPERTY OR
THE LESSEE'S PERSONAL PROPERTY INCLUDING WITHOUT LIMITATION, CONTENTS,
FIRE AND THIRD PARTY LIABILITY (INCLUDING PERSONAL INJURY AND DAMAGE TO
PROPERTY) INSURANCE, SHALL EXPRESSLY:
13.12.1. WAIVE ANY RIGHT OF SUBROGATION ON THE PART OF THE INSURER
AGAINST THE OTHER PARTY AND SHALL BE SUBJECT TO A CONDITION
THAT THE INTERESTS OF THE LESSOR AND OF ANY FACILITY MORTGAGEE
IN SUCH INSURANCE SHALL NOT BE PREJUDICED BY ANY ACT OR
NEGLIGENCE OF THE LESSEE OR OTHER OCCUPIER OF ANY LEASED
PROPERTY WHEREBY THE RISK IS INCREASED WITHOUT THE AUTHORITY
OR KNOWLEDGE OF THE LESSOR OR THE FACILITY MORTGAGEE; AND
13.12.2. PROVIDE THAT A BREACH OF ANY CONDITION OF WARRANTY OF THE
POLICY BY ANY INSURED PARTY SHALL NOT PREJUDICE
<PAGE> 50
THE RIGHTS OF THE OTHER INSURED PARTIES TO COVER PROVIDED BY
THE INSURANCE.
LESSOR ENTITLED TO RECOVERY
13.13. IF REQUESTED BY THE LESSOR AND IF AVAILABLE ON A COMMERCIALLY
REASONABLE BASIS TO THE LESSEE, ALL PUBLIC LIABILITY AND PROPERTY
DAMAGE INSURANCE SHALL CONTAIN A PROVISION THAT THE LESSOR, ALTHOUGH
NAMED AS AN INSURED, SHALL NEVERTHELESS BE ENTITLED TO RECOVERY UNDER
SUCH POLICIES FOR ANY LOSS, DAMAGE, OR INJURY TO THE LESSOR, ITS
SERVANTS, AGENTS, AND EMPLOYEES BY REASON OF THE NEGLIGENCE OF THE
LESSEE OR THE LESSOR. EACH INSURER MENTIONED IN THIS PART 13 SHALL
AGREE, BY ENDORSEMENT ON THE POLICY OR POLICIES ISSUED BY IT, OR BY
INDEPENDENT INSTRUMENT FURNISHED TO THE LESSOR, THAT IT WILL GIVE TO
THE LESSOR (AND TO THE FACILITY MORTGAGEE, IF REQUIRED) AT LEAST 30
DAYS' WRITTEN NOTICE BEFORE THE POLICY OR POLICIES IN QUESTION SHALL BE
ALTERED, ALLOWED TO EXPIRE, CANCELLED OR POSTPONED.
NOTICE OF ACCEPTABLE LIMITS
13.14. IF, FROM TIME TO TIME AFTER THE DATE OF THIS LEASE, THE LESSOR
DETERMINES IN THE EXERCISE OF ITS REASONABLE BUSINESS JUDGEMENT THAT
THE LIMITS OF THE PERSONAL INJURY OR PROPERTY DAMAGE - PUBLIC LIABILITY
INSURANCE THEN CARRIED ARE INSUFFICIENT, THE LESSOR MAY GIVE THE LESSEE
NOTICE OF ACCEPTABLE LIMITS FOR THE INSURANCE TO BE CARRIED, AND THE
INSURANCE SHALL BE INCREASED TO LIMITS AS PRESCRIBED BY THE LESSOR
UNTIL FURTHER INCREASE UNDER THE PROVISIONS OF THIS CLAUSE.
BLOCK POLICY
13.15. SUBJECT TO THE PROVISIONS OF CLAUSE 13.1 THE LESSEE'S OR (IF THE LESSOR
SHALL INSURE) THE LESSOR'S OBLIGATIONS TO CARRY THE INSURANCE PROVIDED
FOR HEREIN MAY BE BROUGHT WITHIN THE COVERAGE OF A SO-CALLED BLOCK
POLICY OR POLICIES OF INSURANCE CARRIED AND MAINTAINED BY THE LESSEE OR
(AS THE CASE MAY BE) THE LESSOR SUBJECT TO THE COVERAGE AFFORDED TO THE
LESSOR AND THE LESSEE NOT BEING REDUCED OR DIMINISHED OR OTHERWISE
MATERIALLY DIFFERENT FROM THAT WHICH WOULD EXIST UNDER A
<PAGE> 51
SEPARATE POLICY MEETING ALL OTHER REQUIREMENTS OF THIS LEASE BY REASON
OF THE USE OF THE BLOCK POLICY. THE REQUIREMENTS OF THIS PART 13
(INCLUDING SATISFACTION OF THE FACILITY MORTGAGEE'S AND THE APPROVAL OF
THE FACILITY MORTGAGEE IF APPLICABLE) ARE OTHERWISE SATISFIED, AND THAT
(IF THE LESSEE INSURES) THE LESSEE MAINTAINS SPECIFIC ALLOCATIONS
ACCEPTABLE TO THE LESSOR.
NO SEPARATE INSURANCE
13.16. THE LESSEE SHALL NOT ON THE LESSEE'S OWN INITIATIVE OR UNDER THE
REQUEST OR REQUIREMENT OF ANY THIRD PARTY, TAKE OUT SEPARATE INSURANCE
CONCURRENT IN FORM OR CONTRIBUTING IN THE EVENT OF LOSS WITH THAT
REQUIRED IN THIS PART 13, TO BE FURNISHED BY, OR WHICH MAY REASONABLY
BE REQUIRED TO BE FURNISHED BY, THE LESSEE, OR INCREASE THE AMOUNT OF
ANY THEN EXISTING INSURANCE BY SECURING AN ADDITIONAL POLICY OR
ADDITIONAL POLICIES, UNLESS ALL PARTIES HAVING AN INSURABLE INTEREST IN
THE SUBJECT MATTER OF THE INSURANCE, INCLUDING IN ALL CASES THE LESSOR
AND ALL FACILITY MORTGAGEES ARE INCLUDED AS ADDITIONAL INSUREDS, AND
THE LOSS IS PAYABLE UNDER SUCH INSURANCE IN THE SAME MANNER AS LOSSES
ARE PAYABLE UNDER THIS LEASE.
ADDITIONAL COVER
13.17. NOTHING SHALL PROHIBIT THE LESSEE FROM:
13.17.1. SECURING INSURANCE REQUIRED TO BE CARRIED UNDER THIS
LEASE WITH HIGHER LIMITS OF LIABILITY THAN REQUIRED
IN THIS LEASE; OR
13.17.2. FROM INSURING AGAINST RISKS IN ADDITION TO THE
INSURED RISKS AND AS TO SUCH INSURANCE, THE LESSOR
AND ANY FACILITY MORTGAGEE NEED NOT BE INCLUDED AS
ADDITIONAL INSUREDS, NOR MUST THE LOSS BE PAYABLE IN
THE SAME MANNER AS LOSSES ARE PAYABLE UNDER THIS
LEASE EXCEPT TO THE EXTENT REQUIRED TO AVOID A
DEFAULT UNDER THE FACILITY MORTGAGE OR ANY OTHER
ENCUMBRANCE. THE LESSEE SHALL IMMEDIATELY NOTIFY THE
LESSOR OF THE TAKING OUT OF ANY SUCH SEPARATE
INSURANCE OR OF THE INCREASING OF ANY OF THE AMOUNT
OF THE THEN EXISTING INSURANCE.
<PAGE> 52
14. INSURANCE PROCEEDS
A. RISKS COVERED BY INSURANCE
PAYMENT OF PROCEEDS
14.1. ALL NET PROCEEDS SHALL BE PAID TO THE LESSOR OR THE LESSEE AS
APPROPRIATE IN ACCORDANCE WITH THE TERMS OF THIS LEASE AND APPLIED AS
PROVIDED IN THIS LEASE.
NET PROCEEDS LESS THAN $250,000
14.2. IF THE NET PROCEEDS ARE LESS THAN $250,000, AND, IF NO EVENT OF DEFAULT
HAS OCCURRED OR IF AN EVENT OF DEFAULT HAS OCCURRED AND WHERE CAPABLE
OF REMEDY HAS BEEN REMEDIED, THE NET PROCEEDS SHALL BE PAID DIRECTLY TO
THE LESSEE AND APPLIED TO ANY RESTORATION OR REPAIR, AS THE CASE MAY
BE, OF ANY DAMAGE TO OR DESTRUCTION OF THE LEASED PROPERTY, OR ANY
PORTION THEREOF.
NET PROCEEDS EXCEED $250,000
14.3. IF THE NET PROCEEDS EQUAL OR EXCEED $250,000, AND IF NO EVENT OF
DEFAULT HAS OCCURRED OR IF AN EVENT OF DEFAULT HAS OCCURRED AND WHERE
CAPABLE OF REMEDY HAS BEEN REMEDIED, THE NET PROCEEDS SHALL BE PAID TO
AND HELD BY THE LESSOR AND MADE AVAILABLE BY THE LESSOR FOR RESTORATION
OR REPAIR, AS THE CASE MAY BE, OF ANY DAMAGE TO OR DESTRUCTION OF THE
LEASED PROPERTY, OR ANY PORTION THEREOF, AS PROVIDED IN CLAUSE 14.22.
THIS CLAUSE SHALL NOT BE CONSTRUED AS IMPOSING ANY OBLIGATION ON THE
LESSOR TO RESTORE OR REPAIR ANY SUCH DAMAGE OR DESTRUCTION.
DISBURSEMENT OF NET PROCEEDS
14.4. WITHIN 15 DAYS AFTER THE RECEIPT OF THE NET PROCEEDS, THE LESSOR AND
THE LESSEE SHALL AGREE AS TO THE PORTION ATTRIBUTABLE TO THE LESSEE'S
PERSONAL PROPERTY (AND FAILING SUCH AGREEMENT SHALL SUBMIT THE MATTER
TO EXPERT DETERMINATION UNDER THE PROVISIONS OF THIS LEASE)
<PAGE> 53
AND THOSE NET PROCEEDS WHICH THE PARTIES AGREE ARE PAYABLE BY REASON OF
ANY LOSS OR DAMAGE TO ANY THE LESSEE'S PERSONAL PROPERTY SHALL BE
DISBURSED IN THE MANNER SPECIFIED IN CLAUSE 14.14. THE LESSOR SHALL PAY
ANY INTEREST RECEIVED (NET OF ANY DEDUCTION) TO THE LESSEE IN RESPECT
OF SUCH MONEY HELD ON THE BASIS REFERRED TO AT PART 10.
TOTAL DESTRUCTION
14.5. IF DURING THE TERM ANY LEASED PROPERTY IS TOTALLY DAMAGED OR DESTROYED
BY AN INSURED RISK AND A FACILITY OR FACILITIES THEREBY RENDERED
TOTALLY UNSUITABLE FOR ITS PRIMARY INTENDED USE ("AFFECTED PROPERTY"),
THE LESSEE SHALL GIVE THE LESSOR NOTICE OF SUCH DAMAGE OR DESTRUCTION
WITHIN 5 BUSINESS DAYS OF THE OCCURRENCE THEREOF. THE LESSEE SHALL,
WITHIN 90 DAYS OF THE OCCURRENCE, EITHER COMMENCE THE RESTORATION OF
THE AFFECTED PROPERTY SUBSTANTIALLY TO THE SAME (OR BETTER) CONDITION
AS THE CONDITION OF THE AFFECTED PROPERTY IMMEDIATELY BEFORE THE DAMAGE
OR DESTRUCTION, AND COMPLETE SUCH RESTORATION WITH ALL DILIGENCE AND
WITHIN 12 MONTHS OF THE OCCURRENCE, OR OFFER IN WRITING TO PURCHASE THE
LEASED PROPERTY FROM THE LESSOR ON THE TERMS SET OUT IN PART 18 FOR THE
REPURCHASE PRICE OF THE LEASED PROPERTY AND (SUBJECT TO CLAUSE 14.7)
SUCH PURCHASE MUST BE COMPLETED WITHIN 12 MONTHS.
ACCOUNT FOR NET PROCEEDS
14.6. IF SUCH PURCHASE IS COMPLETED, THE LESSOR SHALL ACCOUNT TO THE LESSEE
FOR ANY NET PROCEEDS RECEIVED BY THE LESSOR OR ANY FACILITY MORTGAGEE
BY CREDITING THE SAME AGAINST THE PURCHASE PRICE OF THE AFFECTED
PROPERTY AND BY PAYING (IF ANY) IN CASH TO THE LESSEE.
OFFER TO PURCHASE NOT ACCEPTED
14.7. IF THE LESSOR DOES NOT ACCEPT THE LESSEE'S OFFER TO PURCHASE THE LEASED
PROPERTY (WITHIN 10 DAYS OF ITS RECEIPT THEREOF), THE LESSEE SHALL
WITHIN THE 12 MONTH TIME LIMIT, RESTORE THE AFFECTED PROPERTY TO
SUBSTANTIALLY THE SAME CONDITION (OR BETTER) AS EXISTED IMMEDIATELY
BEFORE THE DAMAGE OR DESTRUCTION.
<PAGE> 54
PARTIAL DESTRUCTION
14.8. IF DURING THE TERM, A FACILITY IS PARTIALLY DAMAGED OR DESTROYED BY AN
INSURED RISK BUT THE AFFECTED PROPERTY IS NOT THEREBY RENDERED
UNSUITABLE FOR ITS PRIMARY INTENDED USE, WITHIN 60 DAYS AFTER THE
OCCURRENCE, THE LESSEE SHALL COMMENCE THE RESTORATION OF AND THEREAFTER
DILIGENTLY RESTORE THE AFFECTED PROPERTY TO SUBSTANTIALLY THE SAME (OR
BETTER) CONDITION AS EXISTED IMMEDIATELY BEFORE THE DAMAGE OR
DESTRUCTION.
FAILURE BY LESSEE TO OBTAIN APPROVALS
14.9. IF THE LESSEE CANNOT WITHIN A REASONABLE TIME AFTER DILIGENT EFFORTS TO
DO SO OBTAIN ALL NECESSARY APPROVALS, PERMITS, LICENSES, AND
CERTIFICATES IN ORDER TO BE ABLE TO PERFORM ALL REQUIRED REPAIR AND
RESTORATION WORK AND TO OPERATE THE AFFECTED PROPERTY FOR ITS PRIMARY
INTENDED USE IN SUBSTANTIALLY THE SAME MANNER AS THAT EXISTING
IMMEDIATELY BEFORE THE DAMAGE OR DESTRUCTION THEN, THE LESSEE MAY OFFER
TO PURCHASE THE AFFECTED PROPERTY FROM THE LESSOR AND THE TERMS SET OUT
OR REFERRED TO IN CLAUSE 14.5 SHALL APPLY.
B. RISKS NOT COVERED BY INSURANCE
RISK NOT COVERED
14.10. EXCEPT AS PROVIDED IN CLAUSE 14.18, IF DURING THE TERM, THE AFFECTED
PROPERTY IS TOTALLY OR PARTIALLY DESTROYED FROM A RISK NOT COVERED BY
THE INSURANCE DESCRIBED IN PART 13, THE LESSEE SHALL GIVE THE LESSOR
NOTICE OF SUCH DAMAGE OR DESTRUCTION WITHIN 5 BUSINESS DAYS AFTER THE
OCCURRENCE THEREOF.
LESSEE TO HAVE OPTION WHERE RISKS NOT COVERED
14.11. WHETHER OR NOT THE DAMAGE OR DESTRUCTION RENDERS THE AFFECTED PROPERTY
UNSUITABLE FOR ITS PRIMARY INTENDED USE, THE LESSEE AT ITS OPTION SHALL
EITHER RESTORE THE AFFECTED PROPERTY TO SUBSTANTIALLY THE SAME (OR
BETTER) CONDITION THAN IT WAS IN IMMEDIATELY BEFORE SUCH DAMAGE OR
DESTRUCTION (AND THE DAMAGE OR DESTRUCTION SHALL NOT TERMINATE THIS
LEASE) OR WILL OFFER IN WRITING TO PURCHASE THE LEASED
<PAGE> 55
PROPERTY FROM THE LESSOR FOR THE AGREED AMOUNT IN ACCORDANCE WITH THE
PROVISIONS OF CLAUSES 14.5 (AND SUBJECT TO THE PROVISIONS OF CLAUSE
14.7) ON THE TERMS SET OUT IN PART 18 SUCH PURCHASE TO THE COMPLETED
WITHIN 180 DAYS OF THE OCCURRENCE.
FAILURE TO ELECT
14.12. IF THE LESSEE FAILS TO MAKE THE ELECTION WITHIN 60 DAYS AFTER THE
OCCURRENCE OR IF THE LESSEE ELECTS NOT TO RESTORE WITHIN SUCH 60 DAY
PERIOD THEN THE LESSEE SHALL BE DEEMED TO HAVE OFFERED TO PURCHASE THE
LEASED PROPERTY ON THE TERMS DESCRIBED OR REFERRED TO IN THIS CLAUSE
14.
LESSEE ELECTS TO RESTORE
14.13. IF THE LESSEE ELECTS TO RESTORE THE AFFECTED PROPERTY AND FAILS TO
COMMENCE OR COMPLETE THE RESTORATION WITHIN 1 YEAR AFTER THE OCCURRENCE
THEN THE LESSEE SHALL BE DEEMED TO HAVE ELECTED TO PURCHASE THE
AFFECTED PROPERTY ON SUCH DATE AND THE LESSOR MAY ACCEPT SUCH DEEMED
ELECTION BY SERVING NOTICE ON THE LESSEE WITHIN 10 DAYS OF SUCH DATE
AND IN SUCH CIRCUMSTANCES THE LESSEE SHALL PURCHASE THE AFFECTED
PROPERTY WITHIN 14 MONTHS OF THE OCCURRENCE ON THE TERMS SET OUT IN
PART 18 (EXCEPT THAT CLAUSE PAYMENT OF INSURANCE PROCEEDS SHALL NOT
APPLY). IF THE LESSOR DOES NOT ACCEPT SUCH DEEMED ELECTION, THE LESSEE
SHALL RESTORE THE AFFECTED PROPERTY AS AFORESAID WITHIN 18 MONTHS OF
THE OCCURRENCE.
C. EITHER CASE
PAYMENT OF INSURANCE PROCEEDS
14.14. ALL INSURANCE PROCEEDS PAYABLE BY REASON OF ANY LOSS OF OR DAMAGE TO
ANY OF THE LESSEE'S PERSONAL PROPERTY SHALL BE PAID TO THE LESSEE, AND
THE LESSEE SHALL HOLD SUCH INSURANCE PROCEEDS AND APPLY THEM TO PAY THE
COST OF REPAIRING OR REPLACING THE DAMAGED LESSEE'S PERSONAL PROPERTY.
<PAGE> 56
RESTORE ALTERATIONS ETC
14.15. IF THE LESSEE IS REQUIRED OR ELECTS TO RESTORE THE AFFECTED PROPERTY AS
PROVIDED IN THIS PART 14, THE LESSEE SHALL ALSO RESTORE ALL ALTERATIONS
AND IMPROVEMENTS MADE BY THE LESSEE AND ALL OF THE LESSEE'S PERSONAL
PROPERTY AND THE EXCLUDED PERSONAL PROPERTY. THERE SHALL BE NO
OBLIGATION ON THE LESSEE UNDER THIS CLAUSE TO REPLACE (OR PAY FOR THE
REPLACEMENT OF) THE RESIDENTS' PERSONAL PROPERTY.
NO ABATEMENT OR TERMINATION
14.16. THIS LEASE SHALL REMAIN IN FULL FORCE AND EFFECT AND THE LESSEE'S
OBLIGATION TO PAY RENT AND OUTGOINGS AND ALL OTHER CHARGES REQUIRED BY
THIS LEASE SHALL REMAIN UNABATED DURING THE TERM INCLUDING WITHOUT
LIMITATION ANY PERIOD REQUIRED FOR REPAIR AND RESTORATION.
PERMITTED SURRENDER
14.17. ON A PERMITTED SURRENDER OF A LEASED PROPERTY IN ACCORDANCE WITH THE
TERMS OF THIS LEASE (BEING ON THE COMPLETION OF THE PURCHASE OF SUCH
LEASED PROPERTY BY THE LESSEE OR THE COMPULSORY PURCHASE OF SUCH LEASED
PROPERTY) SUBJECT AS PROVIDED BELOW THE RENT SHALL BE APPORTIONED IN
ACCORDANCE WITH THE PROPORTIONS SET OUT IN SCHEDULE 2 PROVIDED THAT THE
RENT APPORTIONED TO THE LEASED PROPERTY SURRENDERED SHALL NOT IN ANY
CIRCUMSTANCE EXCEED THE RELEVANT MAXIMUM RENT APPORTIONMENT AND THE
RENT APPORTIONED TO THE REMAINING LEASED PROPERTY SHALL NOT IN ANY
CIRCUMSTANCE BE LESS THAN THE MINIMUM CONTINUING RENT.
DAMAGE NEAR END OF TERM - CANNOT BE REPAIRED
14.18. NOTWITHSTANDING ANY PROVISION IN THIS PART 14 TO THE CONTRARY, IF
DAMAGE TO OR DESTRUCTION OF THE AFFECTED PROPERTY OCCURS DURING THE
LAST 12 MONTHS OF THE TERM AND IF SUCH DAMAGE OR DESTRUCTION CANNOT BE
FULLY REPAIRED AND RESTORED WITHIN 6 MONTHS IMMEDIATELY FOLLOWING THE
DATE OF LOSS OR SUCH DAMAGE OR DESTRUCTION RENDERS THE AFFECTED
PROPERTY UNSUITABLE FOR ITS PRIMARY INTENDED USE (AND BEFORE THE
TERMINATING DATE OF THIS LEASE), THEN THE LESSEE SHALL AT THE LESSEE'S
ELECTION FORTHWITH EITHER:
<PAGE> 57
14.18.1. RESTORE THE AFFECTED PROPERTY TO SUBSTANTIALLY THE SAME (OR
BETTER) CONDITION AS EXISTED IMMEDIATELY BEFORE THE DAMAGE OR
DESTRUCTION IN WHICH CASE THE LESSOR SHALL TO THE EXTENT NOT
PREVIOUSLY APPLIED BY THE LESSOR OR ANY FACILITY MORTGAGEE AND
PROVIDED THAT THE LESSEE IS NOT THEN IN DEFAULT PAY ANY NET
PROCEEDS TO THE LESSEE WHICH THE LESSEE SHALL FORTHWITH APPLY
FOR SUCH PURPOSE; OR
14.18.2. NOT RESTORE THE AFFECTED PROPERTY IN WHICH CASE THE LESSOR
SHALL RETAIN ANY NET PROCEEDS AND IN SUCH CASE THE AFFECTED
PROPERTY SHALL CEASE TO BE LEASED PROPERTY FROM THE MOMENT OF
SUCH ELECTION.
DAMAGE NEAR END OF TERM - CAN BE REPAIRED
14.19. IF SUCH DAMAGE OR DESTRUCTION IS NOT SUCH AS TO RENDER THE AFFECTED
PROPERTY UNSUITABLE FOR ITS PRIMARY INTENDED USE AND CAN BE FULLY
REPAIRED AND RESTORED WITHIN SUCH 6 MONTH PERIOD (AND BEFORE THE END OF
THIS LEASE), THE LESSEE SHALL RESTORE THE SAME TO SUBSTANTIALLY THE
SAME (OR BETTER) CONDITION AS EXISTED IMMEDIATELY BEFORE THE DAMAGE OR
DESTRUCTION IN WHICH CASE THE LESSOR SHALL SUBJECT TO THE OTHER
PROVISIONS OF THIS PART 14 PAY ANY NET PROCEEDS TO THE LESSEE, WHICH
THE LESSEE SHALL APPLY FOR THAT PURPOSE.
CEASING TO BE LEASED PROPERTY
14.20. ANY AFFECTED PROPERTY THAT THE LESSEE ELECTS NOT TO RESTORE UNDER
CLAUSE 14.18 SHALL CEASE TO BE LEASED PROPERTY FROM THE MOMENT OF SUCH
ELECTION.
WAIVER
14.21. EXCEPT AS EXPRESSLY PROVIDED ELSEWHERE IN THIS LEASE, THE LESSEE HEREBY
WAIVES ANY STATUTORY OR COMMON LAW RIGHTS OF TERMINATION (BY WAY OF
FRUSTRATION OR OTHERWISE) WHICH MAY ARISE BY REASON OF ANY DAMAGE TO OR
DESTRUCTION OF THE FACILITY.
<PAGE> 58
PERFORMANCE OF RESTORATION
14.22. IF THE LESSEE RESTORES OR REPAIRS A FACILITY UNDER THIS PART 14 AND IF
THE NET PROCEEDS EQUAL OR EXCEED $250,000, THE RESTORATION OR REPAIR
SHALL BE PERFORMED IN ACCORDANCE WITH THE FOLLOWING PROCEDURES:
14.22.1. THE RESTORATION OR REPAIR WORK SHALL BE DONE UNDER PLANS AND
SPECIFICATIONS AND BY THE CONTRACTOR APPROVED BY THE LESSOR
UNDER PART 10.
14.22.2. THE NET PROCEEDS SHALL BE MADE AVAILABLE TO THE LESSEE AS THE
RESTORATION AND REPAIR WORK PROGRESSES UNDER CERTIFICATES OF
AN ARCHITECT REASONABLY ACCEPTABLE TO THE LESSOR, WHICH
CERTIFICATES MUST BE IN FORM AND SUBSTANCE REASONABLY
ACCEPTABLE TO THE LESSOR AND SUBJECT TO A 10% RETENTION (WHICH
MAY BE IN THE FORM OF A BANK GUARANTEE).
14.22.3. THE LESSEE SHALL DELIVER TO THE LESSOR SUCH OTHER EVIDENCE AS
THE LESSOR MAY REASONABLY REQUEST, FROM TIME TO TIME, DURING
THE RESTORATION AND REPAIR, AS TO THE PROGRESS OF THE WORK,
COMPLIANCE WITH THE APPROVED PLANS AND SPECIFICATIONS, THE
COST OF RESTORATION AND REPAIR AND THE TOTAL AMOUNT NEEDED TO
COMPLETE THE RESTORATION AND REPAIR.
14.22.4. THE LESSEE SHALL DELIVER TO THE LESSOR SUCH OTHER EVIDENCE AS
THE LESSOR MAY REASONABLY REQUEST, FROM TIME TO TIME, SHOWING
THAT THERE ARE NO LIENS AGAINST THE LEASED PROPERTY ARISING IN
CONNECTION WITH THE RESTORATION AND REPAIR AND THAT THE COST
OF THE RESTORATION AND REPAIR AT LEAST EQUALS THE TOTAL AMOUNT
OF NET PROCEEDS THEN DISBURSED TO THE LESSEE.
14.22.5. IF THE NET PROCEEDS ARE AT ANY TIME DETERMINED BY THE LESSOR
NOT TO BE ADEQUATE FOR COMPLETION OF THE RESTORATION AND
REPAIR, THE LESSEE SHALL IMMEDIATELY PAY ANY DEFICIENCY TO THE
LESSOR TO BE HELD AND DISBURSED UPON EXHAUSTION OF THE NET
PROCEEDS OR OTHERWISE SATISFY THE LESSOR THAT SUCH FUNDS ARE
AVAILABLE TO THE LESSEE.
<PAGE> 59
14.22.6. THE NET PROCEEDS MAY BE DISBURSED BY THE LESSOR TO THE LESSEE
OR TO THE PERSON ENTITLED TO RECEIVE PAYMENT THEREOF FROM THE
LESSEE, AND SUCH DISBURSEMENT IN EITHER CASE MAY BE MADE
DIRECTLY OR THROUGH A THIRD PARTY ESCROW AGENT, ALL AS THE
LESSOR MAY DETERMINE IN ITS SOLE DISCRETION. ANY EXCESS NET
PROCEEDS SHALL BE PAID TO THE LESSEE UPON COMPLETION OF THE
RESTORATION OR REPAIR. THE LESSOR WILL DETERMINE WHEN THE
RESTORATION OR REPAIR HAS BEEN COMPLETED.
14.22.7. IF THE LESSEE AT ANY TIME FAILS TO PROMPTLY AND FULLY PERFORM
THE CONDITIONS AND COVENANTS SET OUT IN CLAUSES (A) TO (F)
ABOVE, AND THE FAILURE IS NOT CORRECTED WITHIN 10 DAYS AFTER
WRITTEN NOTICE THEREOF, OR IF DURING THE RESTORATION OR REPAIR
AN EVENT OF DEFAULT OCCURS, THE LESSOR MAY, AT ITS OPTION,
IMMEDIATELY CEASE MAKING ANY FURTHER PAYMENTS TO THE LESSEE
FOR THE RESTORATION AND REPAIR UNTIL SUCH FAILURE OR EVENT OF
DEFAULT IS CURED.
14.22.8. THE CONTRACTOR, ARCHITECT AND OTHER PROFESSIONALS AND SUCH
SUBCONTRACTORS AS THE LESSOR MAY DETERMINE SHALL ENTER INTO
DEEDS OF WARRANTY WITH THE LESSOR IN RESPECT OF THE
RESTORATION OR REPAIR WORK SUCH DEEDS TO BE ASSIGNABLE BY THE
LESSOR AND GENERALLY TO BE IN SUCH TERMS AS THE LESSOR MAY
APPROVE, ACTING REASONABLY.
FACILITY MORTGAGEE ENTITLEMENT
14.23. NOTWITHSTANDING ANYTHING IN THIS LEASE TO THE CONTRARY, IF ANY FACILITY
MORTGAGEE IS ENTITLED TO ANY NET PROCEEDS, OR ANY PORTION THEREOF,
UNDER THE TERMS OF ANY FACILITY MORTGAGE, THE NET PROCEEDS SHALL BE
APPLIED, HELD AND/OR DISBURSED IN ACCORDANCE WITH THE TERMS OF THE
FACILITY MORTGAGE. IF THE FACILITY MORTGAGEE ELECTS TO APPLY THE NET
PROCEEDS TO THE INDEBTEDNESS SECURED BY THE FACILITY MORTGAGE, THE
LESSEE SHALL NOT BE REQUIRED TO RESTORE THE AFFECTED PROPERTY AND THE
RENT SHALL BE ADJUSTED TO THE EXTENT FAIR AND EQUITABLE TAKING INTO
<PAGE> 60
ACCOUNT THE PROPORTION OF THE LEASED PROPERTY AS A WHOLE REPRESENTED BY
THE AFFECTED PROPERTY. ANY REDUCTION IN RENT UNDER THIS CLAUSE SHALL
NOT IN ANY CIRCUMSTANCE EXCEED THE RELEVANT MAXIMUM RENT APPORTIONMENT.
CEASING TO BE LEASED PROPERTY
14.24. ANY AFFECTED PROPERTY PURCHASED BY THE LESSEE SHALL CEASE TO BE LEASED
PROPERTY AND SHALL CEASE TO BE SUBJECT TO THIS LEASE WITH EFFECT FROM
COMPLETION OF PURCHASE.
15. COMPULSORY ACQUISITION
RIGHTS AND OBLIGATIONS
15.1. IF DURING THE TERM THERE IS ANY TAKING OF ALL OR ANY PART OF THE
FACILITY OR ANY INTEREST IN THIS LEASE BY ANY SEIZURE MATTER, THE
RIGHTS AND OBLIGATIONS OF THE PARTIES SHALL BE DETERMINED BY THIS PART
15.
TOTAL TAKING
15.2. IF ABSOLUTE TITLE TO THE WHOLE OF THE LEASED PROPERTY IS TAKEN OR
COMPULSORILY PURCHASED BY ANY CONDEMNER, THIS LEASE SHALL CEASE AND
TERMINATE AS TO THE LEASED PROPERTY AS OF THE DATE OF TAKING BY THE
CONDEMNER.
NOTICE OF TERMINATION
15.3. IF ABSOLUTE TITLE OF ANY ONE OF THE LEASED PROPERTIES IS SO TAKEN OR
COMPULSORILY PURCHASED, WHICH NEVERTHELESS RENDERS SUCH PART OF THE
LEASED PROPERTY UNSUITABLE FOR ITS PRIMARY INTENDED USE, THE LESSEE AND
THE LESSOR SHALL EACH HAVE THE OPTION BY WRITTEN NOTICE TO THE OTHER,
AT ANY TIME BEFORE THE TAKING OF POSSESSION BY, OR THE DATE OF VESTING
OF TITLE IN, THE CONDEMNER, WHICHEVER FIRST OCCURS, TO TERMINATE THIS
LEASE AS TO THE LEASED PROPERTY WHICH WAS SO TAKEN OR COMPULSORILY
ACQUIRED AS AFORESAID AS OF THE DATE SO DETERMINED. UPON THE DATE SO
DETERMINED, IF SUCH NOTICE HAS BEEN GIVEN, THIS LEASE SHALL THEREUPON
CEASE AND TERMINATE AS TO THAT LEASED PROPERTY THE ONLY.
<PAGE> 61
APPORTIONMENT OF RENT AND ADDITIONAL CHARGES
15.4. IN EITHER OF SUCH EVENTS UNDER CLAUSES 15.2 AND 15.3, ALL RENT AND
ADDITIONAL CHARGES PAID OR PAYABLE BY THE LESSEE UNDER THIS LEASE
APPLICABLE TO THE LEASED PROPERTY SHALL BE APPORTIONED AS OF THE
TERMINATION DATE OF THIS LEASE. THE RENT APPORTIONED TO THE LEASED
PROPERTY IN RESPECT OF WHICH THIS LEASE IS SO TERMINATED SHALL NOT IN
ANY CIRCUMSTANCE EXCEED THE RELEVANT MAXIMUM RENT APPORTIONMENT AND THE
RENT APPORTIONED TO THE REMAINING LEASED PROPERTY OR SHALL NOT IN ANY
CIRCUMSTANCE BE LESS THAN THE MINIMUM CONTINUING RENT. IN THE EVENT OF
ANY SUCH TERMINATION, THE PROVISIONS OF CLAUSE 15.14 SHALL APPLY.
LESSOR ENTITLED TO AWARD
15.5. THE TOTAL SEIZURE MATTER AWARD MADE WITH RESPECT TO ALL OR ANY PORTION
OF THE FACILITY OR FOR LOSS OF RENT, OR FOR LOSS OF BUSINESS, SHALL BE
SOLELY THE PROPERTY OF AND PAYABLE TO THE LESSOR. NOTHING CONTAINED IN
THIS LEASE WILL BE DEEMED TO CREATE ANY ADDITIONAL INTEREST IN THE
LESSEE IN RESPECT OF ANY PAYMENT BASED ON THE VALUE OF THE UNEXPIRED
TERM OR SO-CALLED "RESIDUAL VALUE" TO THE LESSEE OF THIS LEASE.
LESSEE ENTITLED TO AWARD FOR EXCLUDED PERSONAL PROPERTY
15.6. ANY AWARD MADE FOR THE TAKING OF THE LESSEE'S PERSONAL PROPERTY OR FOR
THE EXCLUDED PERSONAL PROPERTY, OR FOR REMOVAL AND RELOCATION EXPENSES
OF THE LESSEE IN ANY SUCH PROCEEDINGS SHALL BE THE SOLE PROPERTY OF AND
PAYABLE TO THE LESSEE.
EACH PARTY TO SEEK AWARD
15.7. IN ANY SEIZURE MATTER PROCEEDINGS, THE LESSOR AND THE LESSEE SHALL EACH
SEEK ITS OWN AWARD IN CONFORMITY HEREWITH, AT ITS OWN EXPENSE.
NOTWITHSTANDING THE FOREGOING, THE LESSEE MAY PURSUE A CLAIM FOR LOSS
OF ITS BUSINESS, PROVIDED THAT SUCH CLAIM WILL NOT DIMINISH THE
RECOVERY OF THE LESSOR WITH RESPECT TO THE FACILITY.
<PAGE> 62
PAYMENT BY LESSEE OF DEFICIENCY
15.8. SUBJECT TO CLAUSE 15.9, TO THE EXTENT SUCH SEIZURE MATTER AWARD MADE
WITH RESPECT TO ALL OR ANY PORTION OF A LEASED PROPERTY AND PAID TO THE
LESSOR IS LESS THAN THE APPLICABLE REPURCHASE PRICE THE LESSEE SHALL ON
DEMAND PAY THE AMOUNT OF THE DEFICIENCY TO THE LESSOR.
PARTIAL TAKING
15.9. IF ABSOLUTE TITLE TO LESS THAN THE WHOLE OF THE FACILITY IS SO TAKEN OR
ACQUIRED, ALL RENT AND ADDITIONAL CHARGES PAID OR PAYABLE BY THE LESSEE
UNDER THIS LEASE SHALL CONTINUE TO BE PAYABLE AND THE LESSEE SHALL GIVE
THE LESSOR NOTICE OF SUCH PARTIAL TAKING OR ACQUISITION WITHIN 5
BUSINESS DAYS AFTER THE OCCURRENCE THEREOF. IF THE FACILITY IS STILL
SUITABLE FOR ITS PRIMARY INTENDED USE, THE LESSEE, AT ITS OWN COST AND
EXPENSE, SHALL WITH ALL REASONABLE DISPATCH RESTORE THE UNTAKEN PORTION
OF THE LEASED PROPERTIES SO THAT IT SHALL CONSTITUTE A COMPLETE
ARCHITECTURAL UNIT OF THE SAME GENERAL CHARACTER AND CONDITION (AS
NEARLY AS MAY BE POSSIBLE UNDER THE CIRCUMSTANCES) AS THE LEASED
PROPERTY EXISTING IMMEDIATELY BEFORE THE SEIZURE MATTER OR TAKING.
RESTORATION IF PARTIAL TAKING
15.10. THE LESSEE SHALL COMMENCE THE RESTORATION OF THE LEASED PROPERTIES
WITHIN 60 DAYS AFTER THE PARTIAL TAKING OR SUCH (IF ANY) EXTENSION OF
TIME AS MAY BE AGREED WITH THE LESSOR, AND SHALL COMPLETE THE
RESTORATION WITHIN 180 DAYS OF SUCH PARTIAL TAKING OR SUCH (IF ANY)
EXTENSION OF TIME AS MAY BE AGREED WITH THE LESSOR. THE LESSOR SHALL
CONTRIBUTE TO THE COST OF RESTORING SUCH PORTION OF THE AWARD AS IS
MADE THEREFOR, IF ANY, TOGETHER WITH RELEVANT SEVERANCE AND OTHER
DAMAGES AWARDED FOR TAKEN LEASED IMPROVEMENTS; PROVIDED, HOWEVER, THE
AMOUNT OF SUCH CONTRIBUTION SHALL NOT EXCEED SUCH COST.
AWARD LESS THAN $300,000
15.11. AS LONG AS NO EVENT OF DEFAULT HAS OCCURRED HEREUNDER, IF THE AWARD IS
IN AN AMOUNT LESS THAN $300,000, THE LESSOR SHALL PAY THE SAME TO THE
LESSEE UPON COMPLETION OF SUCH RESTORATION.
<PAGE> 63
AWARD EXCEEDS $300,000
15.12. AS LONG AS NO EVENT OF DEFAULT HAS OCCURRED HEREUNDER, IF THE AWARD IS
IN AN AMOUNT MORE THAN $300,000, THE LESSOR SHALL MAKE THE AWARD
AVAILABLE TO THE LESSEE IN THE SAME MANNER AS IS PROVIDED IN PART 14
FOR INSURANCE PROCEEDS IN EXCESS OF $300,000. THE RENT SHALL NOT BE
REDUCED BY REASON OF SUCH PARTIAL TAKING. IF THE LESSEE FAILS TO MAKE
THE ELECTION OR IF THE LESSEE ELECTS NOT TO RESTORE, OR IF THE LESSEE
FAILS TO COMMENCE OR COMPLETE THE RESTORATION WITHIN THE TIME LIMITS
SPECIFIED IN CLAUSE 15.10, THEN THE LESSEE SHALL BE DEEMED TO HAVE
ELECTED TO PURCHASE THE LESSOR'S INTEREST IN THE FACILITY FOR THE
REPURCHASE PRICE.
PURCHASE OF FACILITY
15.13. THE LESSEE SHALL COMPLETE THE PURCHASE WITHIN 180 DAYS AFTER THE SUCH
PARTIAL TAKING. IN ANY SUCH PURCHASE, THE LESSEE SHALL RECEIVE A CREDIT
FOR THE PORTION OF ANY AWARD RETAINED BY THE LESSOR. THE PROVISIONS OF
SCHEDULE 6 SHALL APPLY TO ANY AGREEMENT FOR SALE AND PURCHASE ARISING
UNDER THIS CLAUSE 15.13.
FACILITY MORTGAGEE ENTITLEMENT
15.14. NOTWITHSTANDING ANYTHING HEREIN TO THE CONTRARY, IF ANY FACILITY
MORTGAGEE IS ENTITLED TO ANY COMPULSORY PURCHASE AWARDS, OR ANY PORTION
THEREOF, UNDER THE TERMS OF ANY FACILITY MORTGAGE SUCH AWARDS SHALL BE
APPLIED, HELD AND/OR DISBURSED IN ACCORDANCE WITH THE TERMS OF THE
FACILITY MORTGAGE. IF THE FACILITY MORTGAGEE ELECTS TO APPLY THE AWARDS
TO THE INDEBTEDNESS SECURED BY THE FACILITY MORTGAGE:
15.14.1. IF THE AWARD REPRESENTS AN AWARD FOR PARTIAL TAKING AS
DESCRIBED IN CLAUSE 15.9, THE LESSEE SHALL RESTORE THE
FACILITY (AS NEARLY AS POSSIBLE UNDER THE CIRCUMSTANCES) TO A
COMPLETE ARCHITECTURAL UNIT OF THE SAME GENERAL CHARACTER AND
CONDITION AS THAT OF THE FACILITY EXISTING IMMEDIATELY BEFORE
SUCH TAKING; OR
<PAGE> 64
15.14.2. IF THE AWARD REPRESENTS AN AWARD FOR A TOTAL TAKING AS
DESCRIBED IN CLAUSE 15.3, THE LESSEE SHALL PAY TO THE LESSOR
AN AMOUNT EQUAL TO THE REPURCHASE PRICE AND THE LESSOR SHALL
TRANSFER ITS PORTION OF THE AWARD AND ITS INTEREST IN THE
FACILITY TO THE LESSEE. IN ANY SUCH RESTORATION OR PURCHASE,
THE LESSEE SHALL RECEIVE FULL CREDIT FOR ANY PORTION OF ANY
AWARD RETAINED BY THE LESSOR AND THE FACILITY MORTGAGEE.
16. EVENTS OF DEFAULT
EVENTS DEFINED
16.1. THE FOLLOWING EVENTS (AND SUCH OTHER EVENTS SO DESCRIBED IN THIS LEASE)
ARE EACH AN "EVENT OF DEFAULT" FOR THE PURPOSE OF THIS LEASE:
16.1.1. IF THE LESSEE FAILS TO PAY RENT AS REQUIRED UNDER THIS LEASE
WHEN THE SAME BECOMES DUE AND PAYABLE (WHETHER FORMALLY
DEMANDED OR NOT) AND SUCH FAILURE IS NOT REMEDIED BY THE
LESSEE WITHIN A PERIOD OF 5 DAYS AFTER THE DUE DATE FOR
PAYMENT; OR
16.1.2. IF A WARRANTY, REPRESENTATION OR STATUTORY DECLARATION MADE OF
GIVEN BY OR ON BEHALF OF THE LESSEE OR THE GUARANTOR IN
CONNECTION WITH THIS LEASE, A GROUP LEASE OR THE TRANSACTION
DOCUMENTS IS AT ANY TIME FOUND TO BE MATERIALLY INCORRECT OR
MISLEADING; OR
16.1.3. ANY OF THE FOLLOWING OCCURS IN RESPECT OF THE LESSEE OR
GUARANTOR
16.1.3.1. an application is made, proceedings are initiated
or a meeting (whether of shareholders, creditors or
directors) is called with a view to winding it or
any part of its undertaking up or placing it or any
part of its undertaking under administration;
16.1.3.2. a receiver, liquidator or administrator is
appointed;
<PAGE> 65
16.1.3.3. a compromise or arrangement of the kind referred to
in part 5.1 of the Corporations Law is proposed;
16.1.3.4. an application is made or an action is initiated
with a view to cancelling its registration or
appointing an inspector or other officer to
investigate any of its affairs under any
legislation;
16.1.3.5. it is, or is or may be deemed within the meaning of
any applicable law to be, insolvent or unable to
pay its debts; or
16.1.3.6. circumstances exist which would enable a court upon
application to order its winding up under section
461 of the Corporations Law;
16.1.4. IF DISTRESS IS LEVIED OR A JUDGEMENT OR ORDER IS ENFORCED OR
EXECUTED ON OR AGAINST ANY ASSET OF THE LESSEE OR THE
GUARANTOR OR ANY OF THOSE ASSETS ARE ATTACHED TO ANSWER ANY
JUDGEMENT DEBT;
16.1.5. IF ANY PHYSICAL ASSETS OF THE LESSEE OR THE GUARANTOR WHICH
ARE LOCATED AT THE LEASED PROPERTY ARE CONFISCATED, CANCELLED
OR FORFEITED (EXCEPT WHERE THE LESSEE OR THE GUARANTOR PROVES
TO THE LESSOR WITHIN 7 BUSINESS DAYS AFTER SUCH CONFISCATION,
CANCELLATION OR FORFEITURE THAT SUCH ACTIONS WERE UNLAWFUL OR
IMPROPERLY TAKEN);
16.1.6. IF THE LESSEE OR THE GUARANTOR STOPS PAYMENT OF ITS DEBTS OR
CEASES OR THREATENS TO CEASE TO CARRY ON ANY OF ITS
BUSINESSES;
16.1.7. IF A PROVISION OF THIS LEASE DOES NOT OR CEASES TO HAVE FULL
EFFECT TO THE LESSOR'S REASONABLE SATISFACTION;
16.1.8. IF THE HOLDER OF ANY SECURITY GIVEN AT ANY TIME OVER ANY
ASSETS OF THE LESSEE OR THE GUARANTOR BECOMES
<PAGE> 66
ENTITLED TO EXERCISE ANY POWERS ARISING ON DEFAULT PURSUANT TO
THAT SECURITY OR OTHERWISE TAKE ACTION TO ENFORCE THAT
SECURITY;
16.1.9. IF A PERSON WHO HAS PROVIDED CREDIT OR FINANCIAL ACCOMMODATION
TO THE LESSEE OR THE GUARANTOR BECOMES ENTITLED TO ACCELERATE
ANY OBLIGATION OF THE LESSEE OR THE GUARANTOR TO PAY MONEY TO
THAT PERSON;
16.1.10. IF THE LESSEE OR THE GUARANTOR FAILS TO COMPLY WITH A
CONDITION ATTACHING TO A CONSENT OR APPROVAL ISSUED BY THE
LESSOR IN THE CONTEXT OF THIS LEASE AND SUCH FAILURE IS NOT
REMEDIED BY THE LESSEE WITHIN A PERIOD OF 5 DAYS AFTER THE DUE
DATE FOR COMPLIANCE (OR SUCH OTHER DATE AS AGREED BY THE
LESSOR AND THE LESSEE);
16.1.11. IF IN THE LESSOR'S OPINION THERE IS ANY CHANGE IN THE
ACTIVITIES OF THE LESSEE OR THE GUARANTOR WHICH COULD
MATERIALLY AND ADVERSELY AFFECT THE ABILITY OF THE LESSEE OR
THE GUARANTOR TO MEET ITS OBLIGATIONS TO THE LESSOR; OR
16.1.12. IF WITHOUT LIMITING THE OPERATION OF ANY OTHER EVENT OF
DEFAULT, ANY OTHER EVENT OCCURS OR CIRCUMSTANCE ARISES,
FINANCIAL OR OTHERWISE, WHICH, IN THE REASONABLE OPINION OF
THE LESSOR, IS LIKELY TO MATERIALLY AND ADVERSELY AFFECT THE
ABILITY OF THE LESSEE OR THE GUARANTOR TO MEET ITS OBLIGATIONS
UNDER THIS LEASE; OR
16.1.13. IF THE ESTATE OR INTEREST OF THE LESSEE IN THE LEASED PROPERTY
OR ANY PART THEREOF IS LEVIED UPON OR ATTACHED IN ANY
PROCEEDING OR IS DISTRAINED AGAINST AND THE SAME IS NOT
VACATED OR DISCHARGED WITHIN 30 DAYS AFTER COMMENCEMENT
THEREOF (UNLESS THE LESSEE IS IN THE PROCESS OF CONTESTING
SUCH LIEN OR ATTACHMENT OR DISTRESS IN GOOD FAITH IN
ACCORDANCE WITH PART 12); OR
<PAGE> 67
16.1.14. IF, EXCEPT AS A RESULT OF DAMAGE, DESTRUCTION OR A PARTIAL OR
COMPLETE SEIZURE MATTER, THE LESSEE VOLUNTARILY CEASES
OPERATIONS OF ANY FACILITY FOR A PERIOD IN EXCESS OF 30 DAYS
WITHOUT THE CONSENT OF THE LESSOR; OR
16.1.15. IF THE LESSEE (AND/OR, IF APPLICABLE, A MANAGER OF ANY
FACILITY) HAS ITS APPROVAL SUSPENDED, REVOKED OR TERMINATED;
OR
16.1.16. IF A SANCTION IS IMPOSED ON THE LESSEE (INCLUDING, BUT NOT
LIMITED TO, ONE SUSPENDING ITS RIGHT TO OPERATE ANY FACILITY
OR ACCEPT PATIENTS) WHICH, IN THE REASONABLE OPINION OF THE
LESSOR, IS LIKELY TO MATERIALLY AND ADVERSELY AFFECT THE
ABILITY OF THE LESSEE OR THE GUARANTOR TO MEET ITS OBLIGATIONS
UNDER THIS LEASE; OR
16.1.17. IF THE LESSEE KNOWINGLY CAUSES A DEFAULT, UNDER ANY FACILITY
MORTGAGE, THE TRANSACTION DOCUMENTS, RELATED DOCUMENTS OR
OBLIGATIONS THEREUNDER WHICH DEFAULT IS NOT REMEDIED WITHIN
THE APPLICABLE TIME PERIOD; OR
16.1.18. IF A DEFAULT OR BREACH OF ANY COVENANT OR CONDITION OCCURS
UNDER OR IN RELATION TO ANY LEASE GUARANTEE, ANY GROUP LEASE
OR ANY SUPPLEMENTED LEASE; OR
16.1.19. IF THE LESSEE TRANSFERS, BY MEANS NOT EXPRESSLY PROVIDED FOR
IN AND IN ACCORDANCE WITH THIS LEASE, THE OPERATIONAL CONTROL
OR MANAGEMENT OF THE FACILITY (WHICH EXPRESSION SHALL NOT
INCLUDE A CHANGE OF NAME OF ANY INDIVIDUAL REGISTERED AS THE
PERSON IN CHARGE OF THE FACILITY PROVIDED THE LESSEE REMAINS
REGISTERED AS THE OPERATOR)WITHOUT THE PRIOR WRITTEN CONSENT
OF THE LESSOR WHICH CONSENT MAY IN THE LESSOR'S ABSOLUTE
DISCRETION BE WITHHELD; OR
16.1.20. A DEFAULT OCCURS ON THE PART OF THE LESSEE UNDER ANY OTHER
MATERIAL CONTRACT AFFECTING THE FACILITY OR THE LESSEE; OR
<PAGE> 68
16.1.21. A DEFAULT OCCURS ON THE PART OF THE LESSEE UNDER ANY OF THE
TRANSACTION DOCUMENTS; OR
16.1.22. THE LESSEE FAILS TO PURCHASE A FACILITY IN ACCORDANCE WITH ANY
TERMS REQUIRING SUCH PURCHASE UNDER THIS LEASE; OR
16.1.23. IF THE LESSEE FAILS TO OBSERVE OR PERFORM OR IS IN BREACH OF
ANY OTHER TERM, COVENANT (OTHER THAN THOSE IN CLAUSES 7.2, 7.3
OR 7.4) CONDITION (INCLUDING WITHOUT LIMITATION THOSE IN PART
8) BINDING UPON THE LESSEE IN THIS LEASE AND THE FAILURE
(WHERE CAPABLE OF REMEDY) IS NOT REMEDIED BY THE LESSEE WITHIN
A PERIOD OF 30 DAYS AFTER NOTICE FROM THE LESSOR, UNLESS THE
FAILURE (WHERE CAPABLE OF REMEDY) CANNOT WITH DUE DILIGENCE BE
REMEDIED WITHIN A PERIOD OF 30 DAYS, IN WHICH CASE THE FAILURE
SHALL NOT BE DEEMED TO CONTINUE IF THE LESSEE PROCEEDS
PROMPTLY AND WITH DUE DILIGENCE TO REMEDY THE FAILURE AND
DILIGENTLY COMPLETES THE REMEDYING THEREOF AND COMPLETES THE
REMEDY BEFORE THE TIME THAT THE SAME CAUSES A DEFAULT IN ANY
FACILITY MORTGAGE, THE TRANSACTION DOCUMENTS OR ANY OTHER
LEASE TO WHICH THE LESSEE IS SUBJECT AND BEFORE THE TIME THAT
THE SAME RESULTS IN CIVIL OR CRIMINAL PENALTIES TO THE LESSOR,
THE LESSEE OR ANY ASSOCIATED COMPANIES IN CONNECTION WITH THE
LEASED PROPERTY; OR
16.1.24. IF THE LESSEE FAILS TO OBSERVE OR PERFORM OR IS IN BREACH OF
ANY COVENANT IN CLAUSE 7.2 OR CLAUSE 7.3 OR CLAUSE 7.4; OR
16.1.25. IF THE LESSEE KNOWINGLY FAILS TO MAINTAIN INSURANCE REQUIRED
BY PART 13; OR
16.1.26. IF ANY LEASE GUARANTEE IS TERMINATED, REPUDIATED OR OTHERWISE
FAILS TO BE IN FULL FORCE AND EFFECT.
<PAGE> 69
16.1.27. IF THE LESSEE, THE GUARANTOR OR ANY RELATED BODY CORPORATE OF
EITHER OF THEM DOES NOT PERFORM, DEFAULTS UNDER OR BREACHES
ANY AGREEMENT (OTHER THAN THIS LEASE) ENTERED INTO WITH THE
LESSOR AT ANY TIME, WHETHER BEFORE OR AFTER THE COMMENCEMENT
DATE WHICH, IN THE REASONABLE OPINION OF THE LESSOR IS LIKELY
TO MATERIALLY AND ADVERSELY AFFECT THE ABILITY OF THE LESSEE
OR THE GUARANTOR TO MEET ITS OBLIGATIONS UNDER THIS LEASE.
16.1.28. IF AFTER THREE MONTHS FROM COMMENCEMENT DATE ALL THE AGED CARE
PLACES ALLOCATED IN RESPECT OF EACH FACILITY AS AT THE
COMMENCEMENT DATE ARE NOT TRANSFERRED TO THE LESSEE PURSUANT
TO THE REQUIREMENTS OF THE ACT.
16.1.29. IF THE LESSEE RELINQUISHES ANY AGED CARE PLACE OR ANY AGED
CARE PLACE IS REVOKED, SURRENDERED OR OTHERWISE CEASES TO HAVE
EFFECT PURSUANT TO THE ACT WITH THE EFFECT THAT THE TOTAL
NUMBER OF AGED CARE PLACES IN RESPECT OF THE FACILITIES IS
FEWER THAN 1938.
16.1.30. IF THE LESSEE GUARANTEES THE OBLIGATIONS OF ANY OTHER PERSON.
16.1.31. IF THE TRANSACTION DOCUMENTS OR ANY OTHER RELATED DOCUMENTS
DEEM A CERTAIN DEFAULT TO BE A DEFAULT UNDER THIS LEASE AND
THAT DEFAULT OCCURS.
LESSOR'S RIGHTS ON DEFAULT
16.2. IF AN EVENT OF DEFAULT OCCURS, THEN THE LESSEE SHALL BE IN DEFAULT
UNDER THIS LEASE AND THE LESSOR MAY LAWFULLY IN THE LESSOR'S ABSOLUTE
DISCRETION:
16.2.1. ENTER THE LEASED PROPERTY OR ANY PART THEREOF IN THE NAME OF
THE WHOLE AND TERMINATE THIS LEASE AND THEN PEACEABLY HOLD AND
ENJOY THE SAME AS IF THIS LEASE HAD NOT BEEN MADE BUT WITHOUT
PREJUDICE TO ANY RIGHT OF ACTION OR
<PAGE> 70
REMEDY OF THE LESSOR IN RESPECT OF ANY ANTECEDENT BREACH OF
ANY OF THE LESSEE'S COVENANTS AND OBLIGATIONS IN THIS LEASE
CONTAINED AS PROVIDED IN THIS LEASE, WHEREUPON THIS LEASE
SHALL TERMINATE AND ALL RIGHTS OF THE LESSEE UNDER THIS LEASE
SHALL CEASE (BUT WITHOUT PREJUDICE TO ANY RIGHT OF ACTION OR
REMEDY OF THE LESSOR IN RESPECT OF ANY ANTECEDENT BREACH OF
ANY OF THE LESSEE'S COVENANTS AND OBLIGATIONS IN THIS LEASE
CONTAINED); OR
16.2.2. ENTER THE PART OF THE LEASED PROPERTY IN RELATION TO WHICH THE
LESSEE SHALL BE IN DEFAULT UNDER THIS LEASE AND TERMINATE THIS
LEASE AS TO SUCH PART ONLY AND THEN PEACEABLY HOLD AND ENJOY
THE SAME AS IF THESE PRESENTS HAD NEVER EXTENDED TO SUCH PART
BUT WITHOUT PREJUDICE TO:
16.2.2.1. any right of action or remedy of the Lessor in
respect of any antecedent breach of any of the
Lessee's covenants and obligations in this Lease
contained whereupon the Term shall terminate as to
such part of the Leased Property only and all
rights of the Lessee under this Lease in respect of
such part shall cease;
16.2.2.2. the continuation of this Lease and of the Lessee's
covenants and obligations in this Lease in relation
to the remainder of the Leased Property which shall
remain in full force and effect. In addition, in
any such case the Lessor shall have all rights at
law and in equity available to the Lessor as a
result of the Lessee's breach of this Lease.
LESSEE TO PAY ADDITIONAL CHARGES
16.3. THE LESSEE WILL, TO THE EXTENT PERMITTED BY LAW, PAY AS ADDITIONAL
CHARGES ALL COSTS AND EXPENSES INCURRED BY OR ON BEHALF OF THE LESSOR,
INCLUDING, WITHOUT LIMITATION, REASONABLE LEGAL COSTS (WHETHER OR NOT
LITIGATION IS COMMENCED, AND IF LITIGATION IS COMMENCED, INCLUDING FEES
AND EXPENSES INCURRED IN ANY LITIGATION INCLUDING APPEALS AND
POST-JUDGMENT PROCEEDINGS) AS A RESULT OF ANY DEFAULT OF THE LESSEE
UNDER THIS LEASE.
<PAGE> 71
YIELD UP LEASED PREMISES
16.4. IF AN EVENT OF DEFAULT HAS OCCURRED, AND WHETHER OR NOT THIS LEASE HAS
BEEN TERMINATED UNDER CLAUSE 16.1 OR 16.2, THE LESSEE SHALL, TO THE
EXTENT PERMITTED BY LAW, IF REQUIRED BY THE LESSOR SO TO DO,
IMMEDIATELY YIELD UP TO THE LESSOR THE LEASED PROPERTY UNDER THE
PROVISIONS OF PART 9 AND CLAUSE 16.1 OR 16.2 AND QUIT THE SAME.
DAMAGES
16.5. IF THE LESSOR TERMINATES THE LEASE UNDER THIS CLAUSE 16, THE LESSEE
SHALL PAY TO THE LESSOR ALL AMOUNTS OUTSTANDING AS AT THE DATE OF SUCH
TERMINATION AND ALL CLAIMS IN RESPECT OF EXISTING BREACHES OF COVENANT
AND/OR CONDITION PLUS (IF THE LESSEE SHALL NOT COMPLETE THE PURCHASE OF
THE LEASED PROPERTY UNDER CLAUSE 16.10) AN AMOUNT ("DAMAGES") TO
COMPENSATE THE LESSOR FOR LOSS OF RENT FOR THE BALANCE OF THE TERM (AS
HEREINAFTER DEFINED) WHICH SHALL BE EQUAL TO THE AMOUNT BY WHICH THE
PRESENT VALUE OF FUTURE RENT EXCEEDS THE PRESENT VALUE OF THE HIGHEST
OF:
16.5.1. THE AMOUNT ACTUALLY RECEIVED AND RECEIVABLE BY THE LESSOR AS
RENT FROM RELETTING THE LEASED PROPERTY (OR ANY PART THEREOF)
FOR THE BALANCE OF THE TERM (ADJUSTED TO TAKE ACCOUNT OF ANY
SUBSTANTIAL DIFFERENCES BETWEEN THE TERMS OF SUCH RELETTING
AND THE TERMS OF THIS LEASE SO FAR AS THE SAME WOULD HAVE
REMAINED TO BE PERFORMED DURING THE BALANCE OF THE TERM (BUT
FOR THE AVOIDANCE OF DOUBT THE TERMS ON WHICH THE LESSOR MAY
RELET THE LEASED PROPERTY SHALL BE IN THE LESSOR'S ABSOLUTE
DISCRETION)); OR
16.5.2. THE AMOUNT THAT THE LESSOR MIGHT REASONABLY BE EXPECTED TO
RECEIVE FROM RELETTING THE LEASED PROPERTY FOR THE BALANCE OF
THE TERM ON TERMS SUBSTANTIALLY THE SAME AS THE TERMS OF THIS
LEASE SO FAR AS THE SAME WOULD HAVE REMAINED TO BE PERFORMED
DURING THE BALANCE OF THE TERM (BUT FOR THE AVOIDANCE OF DOUBT
THE TERMS ON WHICH THE LESSOR MAY
<PAGE> 72
MARKET THE LEASED PROPERTY AND RELET THE SAME SHALL BE IN THE
LESSOR'S ABSOLUTE DISCRETION).
Nothing in this clause 16.5 shall operate so as to relieve the Lessor
of its obligations to mitigate its loss.
FULL DISCHARGE
16.6. PAYMENT OF THE DAMAGES TO THE LESSOR SHALL CONSTITUTE A FULL AND FINAL
DISCHARGE OF ALL THE LESSEE'S LIABILITIES TO THE LESSOR IN RELATION TO
THIS LEASE OR THE BREACH OF NONPERFORMANCE THEREOF BY THE LESSEE OTHER
THAN:
16.6.1. ANY LIABILITY FOR UNPAID RENT OR OTHER SUMS OWED TO THE LESSOR
BY THE LESSEE BEFORE THE TERMINATION OF THIS LEASE; AND
16.6.2. IN RESPECT OF ANY AMOUNT OUTSTANDING AND ALL CLAIMS IN RESPECT
OF OTHER BREACHES OF COVENANT AND/OR CONDITION OUTSTANDING AS
AT THE DATE OF SUCH TERMINATION.
DEFAULT OPTION
16.7. IF AN EVENT OF DEFAULT (OTHER THAN WITHIN CLAUSE 16.1) OCCURS THE
LESSEE SHALL HAVE THE OPTION (THE "DEFAULT OPTION") TO PURCHASE THE
LEASED PROPERTY ON THE TERMS OF THIS PART 16.
LESSOR TO GIVE NOTICE
16.8. ON THE LESSOR BECOMING AWARE OF THE OCCURRENCE OF AN EVENT OF DEFAULT
(OTHER THAN WITHIN CLAUSE 16.1) THE LESSOR MAY (BUT IS NOT OBLIGED TO)
SERVE ON THE LESSEE:
16.8.1. A NOTICE ("DEFAULT NOTICE") NOTIFYING THE LESSEE THAT AN EVENT
OF DEFAULT HAS OCCURRED AND THAT THE RIGHT OF RE-ENTRY IN PART
16 HAS BECOME EXERCISABLE; OR
16.8.2. A NOTICE ("LIMITED WAIVER NOTICE") STATING THAT THE LESSOR
DOES NOT INTEND TO RELY ON THE EVENT OF DEFAULT WHICH HAS
OCCURRED (AND SPECIFYING THE SAME) AS A
<PAGE> 73
GROUND FOR FORFEITURE AND EXERCISE ANY RIGHT OF FORFEITURE AVAILABLE TO
THE LESSOR IN CONSEQUENCE OF THAT EVENT OF DEFAULT.
DEFAULT OPTION
16.9. THE DEFAULT OPTION SHALL BE EXERCISABLE BY THE LESSEE BY SIGNING AND
RETURNING A NOTICE IN THE FORM OF THE OPTION NOTICE IN SCHEDULE 5 TO
THIS LEASE (AMENDED TO REFER TO THIS PART 16) ("DEFAULT OPTION NOTICE")
WITHIN 14 BUSINESS DAYS OF RECEIPT BY THE LESSEE OF THE DEFAULT NOTICE
AND CONTEMPORANEOUSLY GIVING A DEFAULT OPTION NOTICE UNDER EACH
SUPPLEMENTAL LEASE, EACH GROUP LEASE AND EACH SUPPLEMENTAL LEASE TO
SUCH GROUP LEASE.
PROVISIONS TO APPLY
16.10. THE PROVISIONS OF PART 18 OF THIS LEASE SHALL APPLY TO THE EXERCISE OF
THE DEFAULT OPTION WITH THE FOLLOWING VARIATIONS:
16.10.1. "COMPLETION DATE" MEANS WITHIN 3 CALENDAR MONTHS AFTER THE
DATE OF SERVICE BY THE LESSEE ON THE LESSOR OF THE SIGNED
DEFAULT OPTION NOTICE.
16.10.2. THE PURCHASE PRICE OF THE LEASED PROPERTY SHALL BE AN AMOUNT
EQUAL TO THE REPURCHASE PRICE PLUS ALL RENT THEN DUE AND
PAYABLE AND ALL OTHER SUMS DUE UNDER THE TERMS OF THIS LEASE
FROM THE LESSEE TO THE LESSOR AS AT THE DATE OF COMPLETION OF
THE PURCHASE.
16.10.3. ANY PURCHASE BY THE LESSEE OF THE LEASED PROPERTY UNDER THE
EXERCISE OF THE DEFAULT OPTION SHALL CONSTITUTE A FULL AND
COMPLETE DISCHARGE AND SATISFACTION OF ALL THE LESSEE'S
LIABILITIES UNDER OR IN CONNECTION WITH THIS LEASE OR THE
BREACH OR NONPERFORMANCE HEREOF.
16.10.4. THE PROVISIONS OF SCHEDULE 6 SHALL APPLY TO ANY AGREEMENT FOR
SALE AND PURCHASE ARISING UNDER THIS PART 16.
<PAGE> 74
16.10.5. THE LESSOR SHALL NOT BE OBLIGED TO COMPLETE THE SALE OF THE
FREEHOLD IN PART ONLY NOR TO COMPLETE THE SALE OTHERWISE THAN
CONTEMPORANEOUSLY WITH COMPLETION OF THE SALES UNDER THE
CORRESPONDING PROVISIONS OF EACH SUPPLEMENTAL LEASE.
NOTICE TO LESSEE
16.11. THE LESSOR HAS THE RIGHT WITHIN 14 BUSINESS DAYS AFTER THE DATE OF
SERVICE ON THE LESSOR BY THE LESSEE OF THE DEFAULT OPTION NOTICE TO
SERVE A FURTHER NOTICE IN REPLY ON THE LESSEE (WHICH ITSELF MUST BE
SERVED ON THE LESSEE WITHIN 7 BUSINESS DAYS) STATING THAT THE LESSOR
DOES NOT INTEND TO RELY ON THE EVENT OF DEFAULT WHICH HAS OCCURRED (AND
SPECIFYING THE SAME) AS A GROUND FOR FORFEITURE AND EXERCISE ANY RIGHTS
OF FORFEITURE AVAILABLE TO THE LESSOR AS A CONSEQUENCE AND IN THAT
EVENT THE EXERCISE OF THE DEFAULT OPTION BY THE LESSEE SHALL BECOME
NULL AND VOID OF NO EFFECT. FOR THE AVOIDANCE OF DOUBT, UNLESS THE
LESSEE SHALL COMPLETE THE PURCHASE OF THE LEASED PROPERTY, THE LESSEE
IS OBLIGED TO REMEDY THE EVENT OF DEFAULT WITHIN THE TIME PERIOD
PROVIDED FOR SUCH EVENT OF DEFAULT UNDER THIS LEASE.
LIMITED WAIVER NOTICE
16.12. THE LESSOR IRREVOCABLY CONFIRMS THAT IF THE LESSOR SERVES A LIMITED
WAIVER NOTICE ON THE LESSEE, THE LESSOR WILL NOT BE ENTITLED TO RELY IN
ANY RESPECT WHATSOEVER ON THE RELEVANT EVENT OF DEFAULT AS A GROUND FOR
FORFEITURE OF THIS LEASE WHICH HAS OCCURRED (WITHOUT PREJUDICE TO THE
RIGHT OF THE LESSOR TO RELY ON THE FUTURE OCCURRENCE OF SUCH AN EVENT
OF DEFAULT AT WHICH TIME THE PROCEDURES IN THIS PART 16 WOULD THEN BE
REPEATED).
LESSEE'S OBLIGATIONS TO CONTINUE
16.13. THE LESSEE'S OBLIGATIONS UNDER THIS PART 16 SHALL CONTINUE IN FULL
FORCE AND EFFECT NOTWITHSTANDING TERMINATION OF THIS LEASE BY THE
LESSOR UNDER THIS PART 16.
<PAGE> 75
APPLICATION OF FUNDS
16.14. ANY PAYMENTS RECEIVED BY THE LESSOR UNDER ANY OF THE PROVISIONS OF THIS
LEASE DURING THE EXISTENCE OR CONTINUANCE OF ANY EVENT OF DEFAULT (AND
WHERE SUCH PAYMENT IS MADE TO THE LESSOR RATHER THAN THE LESSEE DUE TO
THE EXISTENCE OF AN EVENT OF DEFAULT) SHALL BE APPLIED TO THE LESSEE'S
OBLIGATIONS IN THE ORDER WHICH THE LESSOR MAY DETERMINE.
LEGISLATION
16.15. THE LESSOR MAY TERMINATE THIS LEASE (AND RETAIN ALL OF ITS RIGHTS
AGAINST THE LESSEE) IF ANY LEGISLATION IS PASSED OR ANYTHING ELSE
OCCURS WHICH IN THE REASONABLE OPINION OF THE LESSOR MATERIALLY AND
ADVERSELY AFFECTS ANY OF ITS RIGHTS UNDER THIS LEASE.
17. LESSOR'S RIGHT TO REMEDY LESSEES DEFAULT
LESSOR'S RIGHTS
17.1. IF THE LESSEE FAILS TO MAKE ANY PAYMENT OR TO PERFORM ANY ACT REQUIRED
TO BE MADE OR PERFORMED UNDER THIS LEASE, AND FAILS TO REMEDY THE SAME
WITHIN THE RELEVANT TIME PERIODS PROVIDED IN CLAUSE 16.1, THE LESSOR,
WITHOUT FURTHER NOTICE TO OR DEMAND UPON THE LESSEE, AND WITHOUT
WAIVING OR RELEASING ANY OBLIGATION OF THE LESSEE, AND WITHOUT WAIVING
OR RELEASING ANY OBLIGATION OR DEFAULT, MAY (BUT SHALL BE UNDER NO
OBLIGATION TO) AT ANY TIME THEREAFTER MAKE SUCH PAYMENT OR PERFORM SUCH
ACT FOR THE ACCOUNT AND AT THE EXPENSE OF THE LESSEE, AND MAY, TO THE
EXTENT PERMITTED BY LAW, ENTER UPON THE LEASED PROPERTY FOR SUCH
PURPOSE AND TAKE ALL SUCH ACTION THEREON AS, IN THE LESSOR'S SOLE
OPINION, MAY BE NECESSARY OR APPROPRIATE. ANY AMOUNTS PAYABLE BY THE
LESSEE UNDER THIS CLAUSE MUST BE PAID BY THE LESSEE TO THE LESSOR ON
DEMAND AND MAY BE RECOVERED BY THE LESSOR AS A LIQUIDATED DEBT.
SHORT NOTICE
17.2. IF THE LESSOR REASONABLY DETERMINES THAT THE GIVING OF SUCH NOTICE AS
IS PROVIDED FOR IN CLAUSE 17.1 WOULD RISK LOSS TO THE LESSOR OR DAMAGE
TO THE LEASED PROPERTY, THEN THE LESSOR WILL GIVE SUCH NOTICE AS IS
<PAGE> 76
PRACTICAL UNDER THE CIRCUMSTANCES. NO SUCH ENTRY SHALL BE DEEMED
FORFEITURE. ALL SUMS PAID BY THE LESSOR AND ALL COSTS AND EXPENSES
(INCLUDING, WITHOUT LIMITATION, REASONABLE LEGAL FEES AND EXPENSES)
INCURRED, TOGETHER WITH INTEREST THEREON (TO THE EXTENT PERMITTED BY
LAW) AT THE OVERDUE RATE FROM THE DATE ON WHICH SUCH SUMS OR EXPENSES
ARE PAID OR INCURRED BY THE LESSOR, SHALL BE PAID BY THE LESSEE TO THE
LESSOR ON DEMAND AND MAY BE RECOVERED BY THE LESSOR AS A LIQUIDATED
DEBT. THE OBLIGATIONS OF THE LESSEE AND RIGHTS OF THE LESSOR CONTAINED
IN THIS PART 17 SHALL SURVIVE THE EXPIRATION OR EARLIER TERMINATION OF
THIS LEASE.
18. LESSEE'S OPTION TO PURCHASE LEASED PROPERTY
PURCHASE BY LESSEE
18.1. IF THE LESSEE PURCHASES THE LEASED PROPERTY FROM THE LESSOR UNDER ANY
OF THE TERMS OF THIS LEASE, THE LESSOR SHALL, UPON RECEIPT FROM THE
LESSEE OF THE APPLICABLE PURCHASE PRICE, TOGETHER WITH FULL PAYMENT OF
ANY UNPAID RENT DUE AND PAYABLE WITH RESPECT TO ANY PERIOD (PRORATED ON
A DAILY BASIS, IF APPROPRIATE) ENDING ON OR BEFORE THE DATE OF THE
PURCHASE, DELIVER TO THE LESSEE A TRANSFER TOGETHER WITH ALL OTHER
RELEVANT TITLE DEEDS TRANSFERRING THE ENTIRE INTEREST OF THE LESSOR IN
AND TO THE LEASED PROPERTY TO THE LESSEE FREE AND CLEAR OF ALL
ENCUMBRANCES OTHER THAN:
18.1.1. ENCUMBRANCES (NOT BEING IN RESPECT OF DEBT OR OTHER
INDEBTEDNESS OF THE LESSOR OR ANY ASSOCIATED COMPANY OF THE
LESSOR) CONSENTED TO BY THE LESSEE DURING THE TERM; AND
18.1.2. OTHER ENCUMBRANCES CREATED DURING THE TERM IN OPERATION OF THE
LAW THAT DO NOT RELATE TO DEBT OR INDEBTEDNESS OF THE LESSOR
OR ANY ASSOCIATED COMPANY OF THE LESSOR. ALL EXPENSES OF SUCH
CONVEYANCE OR TRANSFER, INCLUDING, WITHOUT LIMITATION, LEGAL
COSTS INCURRED BY THE LESSOR IN
<PAGE> 77
CONNECTION WITH THE TRANSFER, STAMP DUTY AND LAND REGISTRATION
FEES SHALL BE BORNE BY THE LESSEE.
EXPENSES
18.2. IF THE LESSEE SHALL PURCHASE THE LEASED PROPERTY FROM THE LESSOR UNDER
ANY OF THE TERMS OF THIS LEASE THE LESSEE SHALL IN ADDITION TO THE
AGREED AMOUNT ALSO PAY ALL REASONABLE EXPENSES, DISBURSEMENTS AND LEGAL
FEES INCURRED BY THE LESSOR IN THE SALE TRANSACTION.
SALE SUBJECT TO CHARGES ETC
18.3. IN THE EVENT OF A SALE BY THE LESSOR TO THE LESSEE UNDER ANY OF THE
TERMS OF THIS LEASE THEN (SUBJECT TO ANY PROVISION TO THE CONTRARY IN
ANY NOTICE OF TERMS AS REFERRED TO IN THIS PART 18) THE LESSOR SHALL
SELL SUBJECT TO ANY CHARGES, ENCUMBRANCES AND OTHER THIRD PARTY RIGHTS
CREATED, GRANTED OR IMPOSED AFTER THE DATE OF THIS LEASE (OTHER THAN BY
OR IN RESPECT OF DEBTS OR OTHER INDEBTEDNESS OF THE LESSOR OR ANY
ASSOCIATED COMPANY OF THE LESSOR).
SURVIVAL OF RIGHTS
18.4. THE OBLIGATIONS AND RIGHTS OF THE LESSOR AND THE LESSEE CONTAINED IN
THIS PART 18 SHALL SURVIVE THE EXPIRATION OR EARLIER TERMINATION OF
THIS LEASE.
EXERCISE
18.5. THE ELECTION REFERRED TO IN PART 14 SHALL BE EXERCISABLE BY THE LESSEE
BY SIGNING AND SERVING ON THE LESSOR A NOTICE IN THE TERMS OF THE
OPTION NOTICE.
EFFECT OF SERVICE
18.6. SERVICE BY THE LESSEE OF AN OPTION NOTICE IF ACCEPTED BY THE LESSOR AS
PROVIDED FOR IN PART 14 SHALL CONSTITUTE A BINDING CONTRACT WHEREBY THE
LESSOR SHALL SELL AND THE LESSEE SHALL PURCHASE THE LEASED PROPERTY BUT
SUBJECT TO THE MATTERS (IF ANY) SET OUT IN SCHEDULE 3 AND AS MENTIONED
IN CLAUSE 18.1.
<PAGE> 78
NO PART SALE ONLY
18.7. THE LESSOR SHALL NOT BE OBLIGED TO COMPLETE THE SALE OF THE LEASED
PROPERTY IN PART ONLY.
SALE PROVISIONS
18.8. THE PROVISIONS OF SCHEDULE 6 SHALL APPLY TO ANY AGREEMENT FOR SALE AND
PURCHASE ARISING UPON THE EXERCISE OF THE ELECTION REFERRED TO IN PART
14.
19. INDEMNITY
19.1. IF THE LESSEE FAILS TO YIELD UP THE LEASED PROPERTY IN A TIMELY MANNER
AND IN ACCORDANCE WITH THE PROVISIONS HEREOF UPON THE EXPIRATION OR
TERMINATION OF THIS LEASE, IN ADDITION TO ANY OTHER LIABILITIES TO THE
LESSOR ACCRUING THEREFROM, THE LESSEE SHALL INDEMNIFY AND HOLD THE
LESSOR, ITS PRINCIPALS, OFFICERS, DIRECTORS, AGENTS AND EMPLOYEES
HARMLESS FROM LOSS OR LIABILITY RESULTING FROM SUCH FAILURE, INCLUDING,
WITHOUT LIMITING THE GENERALITY OF THE FOREGOING, LOSS OF RENTAL WITH
RESPECT TO ANY NEW LEASE IN WHICH THE RENTAL PAYABLE THEREUNDER IS LESS
THAN ANY RENTAL PAID BY THE LESSEE UNDER THIS LEASE AND ANY CLAIMS
AGAINST THE LESSOR BY ANY PROPOSED NEW TENANT FOUNDED ON SUCH FAILURE.
THE PROVISIONS OF THIS PART 19 SHALL SURVIVE THE EXPIRATION OR
TERMINATION OF THIS LEASE.
20. LESSEE'S CERTIFICATE
LESSEE INDEMNIFIES
20.1. THE LESSEE AGREES, UPON NOT LESS THAN 10 DAYS' PRIOR NOTICE BY THE
LESSOR TO EXECUTE, ACKNOWLEDGE AND DELIVER TO THE LESSOR THE LESSEE'S
CERTIFICATE. THE LESSEE WARRANTS THAT ANY LESSEE'S CERTIFICATE MAY BE
RELIED UPON BY THE LESSOR, ANY PROSPECTIVE TENANT OR PURCHASER OF THE
LEASED PROPERTY, ANY MORTGAGE OR PROSPECTIVE MORTGAGEE, OR BY ANY OTHER
PARTY WHO MAY REASONABLY RELY ON THE LESSEE'S CERTIFICATE (AS IF THAT
PERSON WAS NAMED IN THE LESSEE'S CERTIFICATE).
<PAGE> 79
STATEMENT
20.2. THE LESSEE'S FAILURE TO DELIVER THE LESSEE'S CERTIFICATE WITHIN SUCH
TIME SHALL CONSTITUTE AN EVENT OF DEFAULT. IN ADDITION, IT SHALL
CONSTITUTE THE LESSOR'S AUTHORITY TO EXECUTE AND DELIVER A CERTIFICATE
TO THE EFFECT THAT THE LESSEE REPRESENTS AND WARRANTS THAT:
20.2.1. THIS LEASE IS IN FULL FORCE AND EFFECT WITHOUT MODIFICATION;
20.2.2. THE LESSOR IS NOT IN BREACH OR DEFAULT OF ANY OF ITS
OBLIGATIONS UNDER THIS LEASE.
LESSOR'S CERTIFICATE
20.3. THE LESSOR SHALL PROVIDE AND DELIVER TO THE LESSEE AN EQUIVALENT
CERTIFICATE (MUTATIS MUTANDIS) TO THE LESSEE'S CERTIFICATE REFERRED TO
IN CLAUSE 20.1 AND ON THE SAME TERMS AND CONDITIONS AS SET OUT IN SUCH
CLAUSE. THE LESSOR SHALL ALSO FROM TIME TO TIME DELIVER TO THE LESSEE
AT THE LESSEE'S REQUEST A RECEIPT FOR THE MOST RECENTLY PAID
INSTALLMENT OF RENT.
21. RISK OF LOSS
21.1. DURING THE TERM OF THIS LEASE, THE RISK OF LOSS OR OF DECREASE IN THE
ENJOYMENT AND BENEFICIAL USE OF THE LEASED PROPERTY IN CONSEQUENCE OF
THE DAMAGE OR DESTRUCTION BY FIRE, THE ELEMENTS, CASUALTIES, THEFTS,
RIOTS, WARS TERRORIST ACTIVITY OR OTHERWISE, OR IN CONSEQUENCE OF
FORECLOSURES, ATTACHMENTS, LEVIES OR EXECUTIONS (OTHER THAN THOSE
CAUSED BY THE LESSOR AND THOSE CLAIMING FROM, THROUGH OR UNDER THE
LESSOR) IS ASSUMED BY THE LESSEE, AND THE LESSOR SHALL IN NO EVENT BE
ANSWERABLE OR ACCOUNTABLE FOR SUCH DAMAGE OR DESTRUCTION NOR SHALL ANY
OF THE EVENTS MENTIONED IN THIS CLAUSE ENTITLE THE LESSEE TO ANY
ABATEMENT OF RENT UNDER THIS LEASE EXCEPT AS EXPRESSLY PROVIDED IN THIS
LEASE.
<PAGE> 80
22. INDEMNITIES AND WAIVER OF WARRANTIES
LESSOR UNDER NO LIABILITY
22.1. IT IS AGREED BETWEEN THE PARTIES, AS A FUNDAMENTAL BASIS ON WHICH THIS
LEASE IS BEING ENTERED INTO BY THE LESSOR, THAT TO THE MAXIMUM EXTENT
POSSIBLE THE LESSOR SHOULD BE UNDER NO LIABILITY (OTHER THAN UNDER THE
LESSOR'S EXPRESS OBLIGATIONS UNDER THIS LEASE OR UNDER ANY FACILITY
MORTGAGE OR UNDER THE OTHER TRANSACTION DOCUMENTS) IN RESPECT OF THE
LEASED PROPERTY OR THE SUBSEQUENT SALE OR DISMANTLING, REMOVAL AND
DISPOSAL OF THE LEASED PROPERTY AND THE LESSEE HEREBY INDEMNIFIES THE
LESSOR AND ANY MORTGAGEE AND SHALL KEEP EACH INDEMNIFIED AS SET OUT IN
THIS PART 22.
LESSEE INDEMNITY
22.2. TO THE FULLEST EXTENT PERMITTED BY LAW, THE LESSEE AGREES TO PROTECT,
INDEMNIFY, DEFEND AND SAVE HARMLESS THE LESSOR, ITS DIRECTORS,
OFFICERS, SHAREHOLDERS, AGENTS AND EMPLOYEES FROM AND AGAINST ANY AND
ALL FORESEEABLE OR UNFORESEEABLE LIABILITY, EXPENSE, LOSS, COSTS,
DEFICIENCY, FINE, PENALTY, OR DAMAGE, (INCLUDING WITHOUT LIMITATION
PUNITIVE OR CONSEQUENTIAL DAMAGES) OF ANY KIND OR NATURE, INCLUDING
PROPER LEGAL COSTS FROM ANY SUITS, CLAIMS OR DEMANDS, ON ACCOUNT OF ANY
MATTER OR THING, ACTION OR FAILURE TO ACT ARISING OUT OF OR IN
CONNECTION WITH:
22.2.1. THE LEASE (INCLUDING WITHOUT LIMITATION, THE BREACH BY THE
LESSEE OF ANY OF ITS OBLIGATIONS UNDER THE LEASE); OR
22.2.2. THE PROPERTIES; OR
22.2.3. THE OPERATIONS (OF THE LESSEE OR OTHERWISE) ON THE PROPERTIES,
INCLUDING WITHOUT LIMITATION ALL HAZARDOUS SUBSTANCES ON THE
PROPERTIES ALL CLAIMS IN RESPECT OF CONTAMINATION OR ANY
VIOLATION BY THE LESSEE OF ENVIRONMENTAL
<PAGE> 81
LAWS WITH RESPECT TO THE PROPERTIES WHETHER ANY SUCH CLAIMS
ARE CAUSED BY THE ACTS OR OMISSIONS OF THE LESSEE OR NOT, AND
WHETHER THEY ARISE OR ARE CAUSED DURING THE TERM OF THIS
LEASE, BEFORE THE COMMENCEMENT OF THIS LEASE OR AFTER THIS
LEASE IS TERMINATED.
NOTICE OF SUIT ETC
22.3. UPON RECEIVING KNOWLEDGE OF ANY SUIT, CLAIM OR DEMAND ASSERTED BY A
THIRD PARTY THAT EITHER PARTY BELIEVES IS COVERED BY THIS INDEMNITY,
EITHER PARTY SHALL GIVE THE OTHER NOTICE OF THIS MATTER. THE LESSEE
SHALL DEFEND THE LESSOR AGAINST SUCH MATTER AT THE LESSEE'S SOLE COST
AND EXPENSE WITH LAWYERS (INCLUDING BARRISTERS) REASONABLY SATISFACTORY
TO THE LESSOR AND APPROVED BY THE LESSEE, WHICH APPROVAL SHALL NOT BE
UNREASONABLY WITHHELD OR DELAYED.
CONTINUING INDEMNITY
22.4. THE INDEMNITY CONTAINED IN THIS CLAUSE SHALL CONTINUE IN FULL FORCE AND
EFFECT NOTWITHSTANDING THE DETERMINATION OR EXPIRY OF THIS LEASE.
LESSOR NOT LIABLE
22.5. THE LESSOR SHALL NOT BE LIABLE TO THE LESSEE (AND THE LESSEE HEREBY
WAIVES ANY CLAIM IT MIGHT OTHERWISE HAVE AGAINST THE LESSOR) FOR ANY
LOSS, LIABILITY CLAIM OR PROCEEDINGS IN RESPECT OF ANY INJURY LOSS OR
DAMAGE OF WHATSOEVER NATURE AND HOWSOEVER CAUSED ARISING DIRECTLY OR
INDIRECTLY OUT OF OR IN CONNECTION WITH THE LEASED PROPERTIES THEIR
DESIGN, CONSTRUCTION, REPAIR, REBUILDING, OCCUPATION, USE, OPERATION,
LEASE, SUBLEASE OR OWNERSHIP OR ANY RELATED WORKS OR ANY DEFECTS OR
OTHER MATTERS CONTAINED IN OR REFERRED TO IN THE CERTIFICATES OF TITLE
FOR THE LEASED PROPERTIES OR IN RESPECT OF ANY OTHER MATTER OR
INDEMNITY WHICH IS AN OBLIGATION OF THE LESSEE UNDER THIS LEASE. THIS
CLAUSE SHALL NOT APPLY TO ANY LOSS, LIABILITY CLAIM OR PROCEEDINGS IN
RESPECT OF ANY INJURY LOSS OR DAMAGE RESULTING FROM THE GROSS
NEGLIGENCE OR WILFUL MISCONDUCT OF THE LESSOR, ITS OFFICERS AGENTS OR
EMPLOYEES.
<PAGE> 82
NO REPRESENTATIONS ETC
22.6. THE LESSOR SHALL BE DEEMED NOT TO HAVE MADE ANY REPRESENTATION OR
WARRANTY EITHER EXPRESS OR IMPLIED TO THE LESSEE AS TO THE VALUE,
DESIGN, OPERATION OR CONDITION OR THE QUALITY, DURABILITY, SUITABILITY,
MERCHANTABILITY OR FITNESS FOR ANY PURPOSE OF THE LEASED PROPERTY OR
ANY PART OF THE LEASED PROPERTY OR AS TO THE LESSOR'S TITLE THERETO OR
AS TO ANY MATTER RELATING TO THE LEASED PROPERTY OR ANY PART OF THE
LEASED PROPERTY. EXCEPT AS OTHERWISE PROVIDED, ALL SUCH MATTERS SHALL
BE AT THE SOLE RISK OF THE LESSEE AND THE BENEFITS OF ANY AND ALL
IMPLIED WARRANTIES AND REPRESENTATIONS ON THE PART OF THE LESSOR ARE
(TO THE MAXIMUM EXTENT PERMITTED BY LAW) HEREBY EXPRESSLY EXCLUDED BY
THE LESSOR AND WAIVED BY THE LESSEE.
WARRANTY BY LESSEE
22.7. THE LESSEE WARRANTS THAT IN ENTERING INTO THIS LEASE, THE LESSEE HAS
NOT RELIED ON ANY REPRESENTATION OR WARRANTY BY ANY PERSON, EXCEPT
THOSE EXPRESSLY STATED IN THIS LEASE.
23. SUBLETTING AND ASSIGNMENT
NO ASSIGNMENT
23.1. SUBJECT TO CLAUSE 23.2, DURING THE CONTINUANCE OF THIS LEASE, IN
RESPECT OF WHOLE OR PART OF THIS LEASE OR THE LEASED PROPERTY, THE
LESSEE SHALL NOT:
23.1.1. ASSIGN, TRANSFER, SUBLET, DEAL WITH, HOLD ON TRUST, OR GRANT
ANY INTEREST IN, THIS LEASE;
23.1.2. PART WITH POSSESSION OF WHOLE OR ANY PART OF THE LEASED
PROPERTY;
23.1.3. (EXCEPT WHERE NECESSARY TO CARRY OUT THE PRIMARY INTENDED USE)
GRANT ANY LICENCE, OR SHARE THE RIGHT OF OCCUPATION OR
POSSESSION, IN RESPECT OF WHOLE OR PART OF THE LEASED
PROPERTY.
<PAGE> 83
NO PARTING WITH POSSESSION
23.2. THE LESSEE COVENANTS NOT TO PART WITH POSSESSION OR SHARE THE
OCCUPATION OF THE WHOLE OR ANY PART OR PARTS OF THE LEASED PROPERTY OR
PERMIT ANY PERSON TO OCCUPY THE LEASED PROPERTY EXCEPT BY WAY OF PROPER
DELEGATION OF OPERATIONAL CONTROL AND MANAGEMENT OF THE FACILITY TO AN
ASSOCIATED COMPANY IN A MANNER WHICH DOES NOT CREATE OR CONSTITUTE THE
RELATIONSHIP OF LANDLORD AND TENANT. IN THE CASE OF SUCH DELEGATION THE
LESSEE SHALL REMAIN IN CONTROL OF THE LEASED PROPERTY FOR THE PURPOSES
OF THIS LEASE AND THE ESSENTIAL LEGISLATION.
DERIVATIVE INTERESTS
23.3. THE LESSEE COVENANTS FROM TIME TO TIME ON DEMAND DURING THE TERM TO
GIVE THE LESSOR FULL PARTICULARS OF ALL DERIVATIVE INTERESTS OF OR IN
THE LEASED PROPERTY OR ANY PART THEREOF IRRESPECTIVE OF HOW REMOTE OR
INFERIOR INCLUDING PARTICULARS OF THE RENT OR RENTS PAYABLE IN RESPECT
OF SUCH DERIVATIVE INTERESTS AND SUCH FURTHER PARTICULARS AS THE LESSOR
MAY REASONABLY REQUIRE..
PHARMACY ETC
23.4. NOTHING HEREIN SHALL RESTRICT THE LESSEE FROM PERMITTING ANY ASSOCIATED
COMPANY OF THE LESSEE OR OF THE GUARANTOR TO OPERATE A PHARMACY,
THERAPY DEPARTMENT OR OTHER ANCILLARY SERVICE DEPARTMENT WITHIN ANY
FACILITY SUBJECT TO THE RELATIONSHIP OF LANDLORD AND TENANT NOT THEREBY
ARISING.
24. OFFICERS CERTIFICATES, FINANCIAL STATEMENTS
CERTIFICATES
24.1. THE LESSEE WILL FURNISH AND WILL CAUSE THE GUARANTOR TO FURNISH THE
FOLLOWING STATEMENTS TO THE LESSOR:
24.1.1. WITHIN 120 DAYS AFTER THE END OF EACH OF THE LESSEE'S
ACCOUNTING YEARS, AND TOGETHER WITH THE ACCOUNTS FURNISHED IN
ACCORDANCE WITH CLAUSE 24.1(C) AND ANY LEASE
<PAGE> 84
GUARANTEE:
24.1.1.1. an Officer's Certificate of the Lessee stating that
the Lessee is not in default in the performance or
observance of any of the terms of this Lease, or if
the Lessee is in default, specifying all such
defaults, the nature thereof, and the steps being
taken to remedy the same; and
24.1.1.2. a certificate from a qualified, certified public
accountant acceptable to the Lessor that nothing
came to their attention during the course of their
audit of the Lessee's Accounts that would cause
them to believe that there was any default under
Part 8 of this Lease;
24.1.1.3. a reconciliation statement prepared by the same
person referred to in clause 24.1(a)(ii)
reconciling the Accounts to the generally accepted
accounting principles of Australia for the
preparation of financial statements.
24.1.2. WITHIN 25 DAYS AFTER THE END OF EACH MONTH, MONTHLY FINANCIAL
REPORTS FOR EACH FACILITY WITH DETAILED STATEMENTS OF INCOME
TURNOVER AND DETAILED OPERATIONAL STATISTICS REGARDING
OCCUPANCY RATES, PATIENT MIX AND PATIENT RATES BY TYPE FOR
EACH FACILITY AND IF REQUESTED BY THE LESSOR SUCH OTHER
INFORMATION OR EVIDENCE AS THE LESSOR SHALL REQUIRE TO SATISFY
THE LESSOR THAT SUCH STATEMENTS AND STATISTICS ARE CORRECT AND
SUCH INFORMATION OR EVIDENCE SHALL BE SUPPLIED AS SOON AS
PRACTICABLE BY THE LESSEE AND IN ANY EVENT WITHIN 30 DAYS
AFTER REQUEST;
24.1.3. WITHIN 15 DAYS AFTER THEY ARE REQUIRED (OR ARE SIGNED IF
SOONER) COPIES OF ANY AUDITED ANNUAL OR QUARTERLY REPORT
AND/OR ACCOUNTS WHICH THE LESSEE OR THE GUARANTOR IS OR ARE
REQUIRED BY LAW TO PREPARE OR DO PREPARE;
<PAGE> 85
24.1.4. WITHIN 30 DAYS AFTER RECEIPT THEREOF, COPIES OF SURVEYS OF
REPORTS UNDERTAKEN BY THE APPROPRIATE GOVERNMENTAL AUTHORITIES
FOR LICENSING OR CERTIFICATION OR REGISTRATION PURPOSES, AND
ANY PLAN OF CORRECTION SUBMITTED BY THE LESSEE FOR THE
FACILITY AND WILL GIVE IMMEDIATE NOTICE TO THE LESSOR OF ANY
ACTION, PROPOSAL OR INVESTIGATION BY ANY AGENCY OR ENTITY, OR
COMPLAINT TO SUCH AGENCY OR ENTITY, (ANY OF WHICH IS CALLED A
"PROCEEDING"), KNOWN TO THE LESSEE, THE RESULT OF WHICH
PROCEEDING IS INTENDED TO:
24.1.4.1. revoke or suspend or terminate or modify in a way
adverse to the Lessee, or fails to renew or fully
continue in effect, any licence, registration or
certificate or operating authority under which the
Lessee operates any facility in accordance with its
Primary Intended Use; or
24.1.4.2. suspend, terminate, adversely modify, or seek
return of or reimbursement for any material
previously advanced or paid; or
24.1.4.3. impose any limitation on patient admission or
similar restriction on any Facility; or
24.1.4.4. prosecute any party with respect to the operation
of any activity at any Facility or enjoin any party
or seek any civil penalty in excess of $1,500 in
respect thereof;
24.1.5. AS SOON AS THEY ARE PREPARED IN EACH LEASE YEAR, CAPITAL AND
OPERATING BUDGETS FOR EACH FACILITY; AND
24.1.6. WITH REASONABLE PROMPTNESS, SUCH OTHER INFORMATION RESPECTING
THE FINANCIAL CONDITION AND AFFAIRS OF THE LESSEE AND EACH
FACILITY AS THE LESSOR MAY REASONABLY REQUEST FROM TIME TO
TIME INCLUDING, WITHOUT LIMITATION, ANY SUCH OTHER INFORMATION
AS MAY BE AVAILABLE TO THE ADMINISTRATION OF THE LEASED
PROPERTY.
<PAGE> 86
PUBLIC OFFERING
24.2. IN CONNECTION WITH THE PUBLIC OFFERING OF ANY SECURITIES ISSUED OR TO
BE ISSUED BY THE LESSOR AND/OR COMPLIANCE WITH APPLICABLE SECURITIES
LAW, THE LESSEE SHALL, UPON THE LESSOR'S REASONABLE REQUEST, PROVIDE
THE LESSOR AT THE LESSOR'S SOLE COST AND EXPENSE (TO THE EXTENT THE
LESSEE INCURS COST IN ADDITION TO THOSE IT WOULD IN ANY EVENT HAVE BEEN
OBLIGED TO INCUR) WITH SUCH AUDITED FINANCIAL INFORMATION CONCERNING
THE LESSEE OR THE FACILITIES AS THE LESSOR MAY BE REQUIRED BY LAW TO
INCLUDE IN ITS PUBLIC FILINGS. THE LESSEE SHALL NOT HAVE, AND THE
LESSOR SHALL INDEMNIFY FULLY AND HOLD THE LESSEE HARMLESS AGAINST, ANY
LIABILITY TO THE LESSOR OR ANY THIRD PARTY IN CONNECTION WITH THE
LESSOR'S USE THEREOF OTHER THAN LIABILITY RESULTING FROM THE GROSS
NEGLIGENCE OR WILFUL MISCONDUCT OF THE LESSEE, ITS OFFICERS AGENTS OR
EMPLOYEES IN THE PREPARATION THEREOF.
25. LESSOR'S RIGHT TO INSPECT
25.1. THE LESSEE SHALL:
25.1.1. PERMIT THE LESSOR AND ITS AUTHORISED REPRESENTATIVES TO
INSPECT THE LEASED PROPERTY DURING USUAL BUSINESS HOURS ON
REASONABLE PRIOR NOTICE (SAVE IN THE CASE OF AN EMERGENCY) THE
LESSOR ENSURING THERE IS NO UNDUE DISTURBANCE TO THE OPERATION
OF THE FACILITY;
25.1.2. PAY THE LESSOR ON 1 JULY EACH YEAR A FEE OF $1,000 PER LEASED
PROPERTY PER ANNUM IN RESPECT OF THE INSPECTION CARRIED OUT BY
OR ON BEHALF OF THE LESSOR UNDER CLAUSE 25.1(A) (WHETHER OR
NOT THE SAME SHALL ACTUALLY BE CARRIED OUT).
26. NO WAIVER
26.1. NO FAILURE BY THE LESSOR TO INSIST UPON THE STRICT PERFORMANCE OF ANY
TERM OF THIS LEASE OR TO EXERCISE ANY RIGHT, POWER OR REMEDY
<PAGE> 87
CONSEQUENT UPON A BREACH OF THIS LEASE, AND NO ACCEPTANCE OF FULL OR
PARTIAL PAYMENT OF RENT DURING THE CONTINUANCE OF ANY SUCH BREACH,
SHALL CONSTITUTE A WAIVER OF ANY SUCH BREACH OR OF ANY SUCH TERM. NO
WAIVER OF ANY BREACH SHALL AFFECT OR ALTER THIS LEASE, WHICH SHALL
CONTINUE IN FULL FORCE AND EFFECT WITH RESPECT TO ANY OTHER THEN
EXISTING OR SUBSEQUENT BREACH.
27. REMEDIES CUMULATIVE
27.1. TO THE EXTENT PERMITTED BY LAW, EACH LEGAL, EQUITABLE OR CONTRACTUAL
RIGHT, POWER AND REMEDY OF THE LESSOR NOW OR IN THE FUTURE PROVIDED
EITHER IN THIS LEASE OR BY STATUTE OR OTHERWISE SHALL BE CUMULATIVE AND
CONCURRENT AND SHALL BE IN ADDITION TO EVERY OTHER RIGHT, POWER AND
REMEDY AND THE EXERCISE OR BEGINNING OF THE EXERCISE BY THE LESSOR OF
ANY ONE OR MORE OF SUCH RIGHTS, POWERS AND REMEDIES SHALL NOT PRECLUDE
THE SIMULTANEOUS OR SUBSEQUENT EXERCISE BY THE LESSOR OF ANY OR ALL OF
SUCH OTHER RIGHTS, POWERS AND REMEDIES.
28. ACCEPTANCE OF SURRENDER
28.1. NO SURRENDER TO THE LESSOR OF THIS LEASE OR OF THE LEASED PROPERTY OR
ANY PART, OR OF ANY INTEREST, SHALL BE VALID OR EFFECTIVE UNLESS AGREED
TO AND ACCEPTED IN WRITING BY THE LESSOR, AND NO ACT BY THE LESSOR OR
ANY REPRESENTATIVE OR AGENT OF THE LESSOR, OTHER THAN SUCH A WRITTEN
ACCEPTANCE BY THE LESSOR, SHALL CONSTITUTE AN ACCEPTANCE OF ANY SUCH
SURRENDER.
29. NO MERGER OF TITLE, NO PARTNERSHIP
NO MERGER
29.1. THERE SHALL BE NO MERGER OF THIS LEASE OR OF THE LEASEHOLD ESTATE
CREATED BY THE LEASE BY REASON OF THE FACT THAT THE SAME PERSON, FIRM,
CORPORATION OR OTHER ENTITY MAY ACQUIRE, OWN OR HOLD, DIRECTLY OR
INDIRECTLY:
<PAGE> 88
29.1.1. THIS LEASE OR THE LEASEHOLD ESTATE CREATED BY THIS LEASE OR
ANY INTEREST IN THIS LEASE OR SUCH LEASEHOLD ESTATE; AND
29.1.2. THE FREEHOLD OF THE LEASED PROPERTY.
NO PARTNERSHIP
29.2. NOTHING CONTAINED IN THIS LEASE WILL BE DEEMED OR CONSTRUED TO CREATE A
PARTNERSHIP OR JOINT VENTURE BETWEEN THE LESSOR AND THE LESSEE OR TO
CAUSE EITHER PARTY TO BE RESPONSIBLE IN ANY WAY FOR THE DEBTS OR
OBLIGATIONS OF THE OTHER OR ANY OTHER PARTY, IT BEING THE INTENTION OF
THE PARTIES THAT THE ONLY RELATIONSHIP UNDER THIS LEASE IS THAT OF THE
LESSOR AND THE LESSEE.
30. QUIET ENJOYMENT & ADDITIONAL RIGHTS
QUIET ENJOYMENT
30.1. THE LESSOR COVENANTS WITH THE LESSEE THAT SO LONG AS THE LESSEE PAYS
ALL RENT AS IT BECOMES DUE AND COMPLIES WITH ALL OF THE TERMS OF THIS
LEASE AND PERFORMS ITS OBLIGATIONS UNDER THIS LEASE, THE LESSEE SHALL
PEACEABLY AND QUIETLY HAVE, HOLD AND ENJOY THE LEASED PROPERTY FOR THE
TERM, FREE OF ANY CLAIM OR OTHER ACTION BY THE LESSOR OR ANYONE
CLAIMING BY, THROUGH OR UNDER THE LESSOR, BUT SUBJECT TO ALL TITLE
DOCUMENTS PROVIDED FOR IN THIS LEASE OR CONSENTED TO BY THE LESSEE AND
ANY CLAIMS MADE IN RESPECT OF THE EXCLUDED PERSONAL PROPERTY.
FAILURE BY LESSOR NOT TO GIVE LESSEE RIGHTS
30.2. EXCEPT AS OTHERWISE PROVIDED IN THIS LEASE, NO FAILURE BY THE LESSOR TO
COMPLY WITH THE FOREGOING COVENANT WILL GIVE THE LESSEE ANY RIGHT TO
CANCEL OR TERMINATE THIS LEASE OR ABATE, REDUCE COUNTER CLAIM OR MAKE A
DEDUCTION FROM OR SET OFF AGAINST THE RENT OR ANY OTHER SUM PAYABLE
UNDER THIS LEASE, OR TO FAIL TO PERFORM ANY OTHER OBLIGATION OF THE
LESSEE. THE LESSEE SHALL HAVE THE RIGHT, BY SEPARATE AND
<PAGE> 89
INDEPENDENT ACTION, TO PURSUE ANY CLAIM IT MAY HAVE AGAINST THE LESSOR
AS A RESULT OF A BREACH BY THE LESSOR OF THE COVENANT OF QUIET
ENJOYMENT CONTAINED IN THIS PART.
LESSOR TO COMPLY
30.3. THE LESSOR COVENANTS TO COMPLY WITH THE LESSOR'S OBLIGATIONS IN THIS
LEASE.
ADDITIONAL RIGHTS GRANTED
30.4. SUBJECT TO CLAUSE 30.5, THE LESSOR GRANTS TO THE LESSEE THE RIGHT FOR
THE LESSEE AND THOSE LAWFULLY AUTHORISED BY IT (IN COMMON WITH THE
LESSOR AND ALL OTHER PERSONS FROM TIME TO TIME ENTITLED AND TO THE
EXTENT THE LESSOR MAY LAWFULLY GRANT THE SAME) TO USE ALL RIGHTS AND
EASEMENTS TO THE LEASED PROPERTY.
RIGHTS RESERVED TO THE LESSOR
30.5. THERE ARE EXCEPTED AND RESERVED OUT OF THIS DEMISE ALL RIGHTS AND
PRIVILEGES ENJOYED OVER OR AGAINST THE LEASED PROPERTY AND THE
PARTICULAR RIGHTS FOLLOWING NAMELY:
ENTRY UPON THE LEASED PROPERTY
30.5.1. THE RIGHT AT ANY TIME DURING THE TERM BUT (EXCEPT IN
EMERGENCY) ONLY AFTER GIVING REASONABLE PRIOR NOTICE TO THE
LESSEE TO ENTER (OR IN EMERGENCY DURING THE LESSEE'S ABSENCE
TO BREAK AND ENTER) UPON THE LEASED PROPERTY IN ORDER:
30.5.1.1. to view the condition of the Leased Property (and
to open floors and other parts of the Leased
Property where required in order to view) and to
take inventories of the Fixtures, the Lessor's
Personal Property and the Lessee's Personal
Property and things to be yielded up at the
determination of the Term;
30.5.1.2. for any purpose connected with valuing or disposing
of any interest of the Lessor in the Leased
Property; and
30.5.1.3. doing anything necessary to prevent the forfeiture
of any superior lease affecting the Leased
Property.
<PAGE> 90
30.5.2. SUBJECT (IN EACH CASE) TO THE PERSON EXERCISING ANY SUCH RIGHT
CAUSING AS LITTLE DAMAGE AND INCONVENIENCE AS PRACTICABLE AND
MAKING GOOD ALL PHYSICAL DAMAGE THEREBY CAUSED TO THE LEASED
PROPERTY BUT WITHOUT ANY LIABILITY TO PAY COMPENSATION.
CONDUITS
30.5.3. THE RIGHT TO FREE PASSAGE AND RUNNING OF WATER, SURFACE WATER,
SEWAGE, DRAINAGE, GAS, ELECTRICITY, TELECOMMUNICATIONS AND
OTHER SERVICES OR SUPPLIES TO OR FROM ANY ADJACENT PREMISES IN
AND THROUGH ANY OF THE CONDUITS WHICH MAY AT ANY TIME BE IN,
UNDER OR PASSING THROUGH OR OVER THE LEASED PROPERTY.
SUPERIOR LEASES
30.6. IN RESPECT OF SUPERIOR LEASES ENTERED INTO AFTER THE DATE OF THIS
LEASE, THE LESSEE SHALL ONLY BE REQUIRED TO COMPLY WITH A COVENANT IN
SUCH SUPERIOR LEASES TO THE EXTENT THAT SUCH COVENANTS ARE NO MORE
ONEROUS THAT THE EXISTING COVENANTS CONTAINED IN THIS LEASE.
31. NOTICES
WRITTEN NOTICE
31.1. ALL NOTICES UNDER THIS LEASE SHALL BE IN WRITING AND PERSONALLY SERVED
UPON A DIRECTOR OF THE PARTY BEING SERVED OR MAILED (BY REGISTERED OR
RECORDED DELIVERY MAIL), OR BY HAND OR BY FACSIMILE TRANSMISSION
ADDRESSED TO THE RESPECTIVE PARTIES, AS FOLLOWS:
31.1. if to the Lessee: Moran Health Care (Australia) Pty Ltd
13 - 15 Bridge St
Sydney NSW 2000
<PAGE> 91
31.1. if to the Lessor: Principal Healthcare Finance Pty Limited
c/- Phillips Fox
255 Elizabeth Street
SYDNEY NSW 2000
with a copy to: Omega Worldwide Inc
900 Victors Way
Suite 350
Ann Arbor MI 48108
USA
and to: Omega (UK) Limited
145 Cannon Street
London EC4N 5BP
or to such other address as either party may in future
designate.
DEEMED GIVEN
31.2. NOTICE SHALL BE DEEMED TO HAVE BEEN GIVEN ON THE DATE OF DELIVERY IF
SUCH DELIVERY IS MADE ON A BUSINESS DAY, OR IF NOT, ON THE FIRST
BUSINESS DAY AFTER DELIVERY, OR IF DELIVERY IS REFUSED, ON THE DATE
DELIVERY WAS FIRST ATTEMPTED.
FACSIMILE
31.3. A NOTICE SENT BY FACSIMILE TRANSMISSION SHALL BE DEEMED GIVEN UPON
RECEIPT OF CONFIRMATION BY THE SENDER FROM THE RECIPIENT THAT SUCH
NOTICE WAS RECEIVED.
LESSEE VACATED
31.4. IF THE LESSEE HAS VACATED THE LEASED PROPERTY, THE LESSOR'S NOTICE MAY
BE POSTED ON THE DOOR OF THE LEASED PROPERTY. FOR THE PURPOSES OF THIS
<PAGE> 92
PART, THE TERM "DIRECTOR" SHALL MEAN THE CHAIRMAN OF THE BOARD OF
DIRECTORS, THE PRESIDENT, ANY VICE PRESIDENT AND THE SECRETARY OF ANY
CORPORATION AND GENERAL PARTNER OF ANY PARTNERSHIP UPON WHICH SERVICE
IS TO BE MADE.
FAILURE TO SERVE
31.5. THE FAILURE OF THE LESSOR TO SERVE A COPY OF ANY NOTICE SERVED ON THE
LESSEE ON THE GUARANTOR SHALL NOT AFFECT THE VALIDITY OF SUCH NOTICE
SERVED ON THE LESSEE.
32. INTERPRETATION
REDUCTION IN CERTAIN CIRCUMSTANCES
32.1. IF A LEASED PROPERTY SHALL CEASE AT ANY TIME TO FORM PART OF THIS LEASE
(WHETHER BECAUSE THE LESSOR HAS NOT YET COMPLETED ITS PURCHASE OR
BECAUSE THE SAME HAS CEASED TO BE PART OF THIS LEASE BY REASON OF THE
PROVISIONS OF PART 14 OR 15) THE RENT FOR THE RELEVANT TIME AND THE
PURCHASE PRICE OF THE REMAINING LEASED PROPERTY SHALL BE REDUCED ON A
PRO RATA BASIS BY REFERENCE TO THE ALLOCATION OF AGREED AMOUNT AND RENT
AMONG THE PROPERTIES CONTAINED IN SCHEDULE 2. PROVIDED THE RENT
APPORTIONED TO THE REMAINING LEASED PROPERTIES SHALL NOT IN ANY
CIRCUMSTANCE BE LESS THAN THE MINIMUM CONTINUING RENT.
33. RENT ADJUSTMENT
33.1. EXCEPT WHERE DEALT WITH SPECIFICALLY ELSEWHERE IN THIS LEASE IF THE
WHOLE OF A LEASED PROPERTY CEASES TO BE A LEASED PROPERTY FOR ANY
REASON AND IF ALL SUMS OF MONEY PAYABLE TO THE LESSOR CONSEQUENT UPON
THE LEASED PROPERTY CEASING TO BE A LEASED PROPERTY HAVE BEEN PAID IN
FULL THE AGREED AMOUNT AND THE RENT WILL BE REDUCED ON A PRO RATA BASIS
BY REFERENCE TO THE ALLOCATION OF THE AGREED AMOUNT AND THE RENT SET
OUT IN SCHEDULE 2 FROM THE DATE THAT:
33.1.1. THE LEASED PROPERTY CEASES TO BE A LEASED PROPERTY; OR
<PAGE> 93
33.1.2. THE DATE THAT THE LESSOR RECEIVES ALL THE MONEY PAYABLE TO THE
LESSOR CONSEQUENT UPON THE LEASED PROPERTY CEASING TO BE A
LEASED PROPERTY;
33.1.3. WHICHEVER IS THE LATTER PROVIDED THAT THE RENT OF THE
REMAINING LEASED PROPERTIES WILL NOT BE LESS THAN THE MINIMUM
CONTINUING RENT.
34. BREACH BY LESSOR
LESSOR NOT IN BREACH
34.1. THE LESSOR SHALL NOT BE IN BREACH OF THIS LEASE UNLESS THE LESSOR FAILS
TO OBSERVE OR PERFORM ANY TERM, COVENANT OR CONDITION OF THIS LEASE ON
ITS PART TO BE PERFORMED AND SUCH FAILURE CONTINUES FOR A PERIOD OF 30
DAYS AFTER WRITTEN NOTICE SPECIFYING SUCH FAILURE AND THE NECESSARY
CURATIVE ACTION IS RECEIVED BY THE LESSOR FROM THE LESSEE.
CONTINUING FAILURE
34.2. IF THE FAILURE CANNOT WITH DUE DILIGENCE BE CURED WITHIN A PERIOD OF 30
DAYS, THE FAILURE SHALL NOT BE DEEMED TO CONTINUE IF THE LESSOR, WITHIN
THE 30 DAY PERIOD, PROCEEDS PROMPTLY AND WITH DUE DILIGENCE TO CURE THE
FAILURE AND DILIGENTLY COMPLETES THE CURING THEREOF. THE TIME WITHIN
WHICH THE LESSOR SHALL BE OBLIGATED TO CURE ANY SUCH FAILURE SHALL ALSO
BE SUBJECT TO EXTENSION OF TIME DUE TO THE OCCURRENCE OF ANY
UNAVOIDABLE DELAY.
35. FACILITY MORTGAGEE CONSENT
35.1. THE LESSOR SHALL ENSURE THAT THE TERMS OF EACH FACILITY MORTGAGE SHALL
OBLIGE THE FACILITY MORTGAGEE TO GRANT ITS CONSENT OR APPROVAL TO ANY
MATTER IN RESPECT OF WHICH THE LESSOR IS OBLIGED TO GRANT ITS CONSENT
OR APPROVAL UNDER THE TERMS OF THIS LEASE AND THE LESSOR SHALL AT THE
REQUEST AND COST OF THE LESSEE:
<PAGE> 94
35.1.1. APPLY FOR EACH SUCH CONSENT OR APPROVAL AS MAY FROM TIME TO
TIME BE REQUIRED BY THE LESSEE; AND
35.1.2. ENFORCE AT THE LESSEE'S COST THE FACILITY MORTGAGEE'S
OBLIGATIONS WITH REGARD TO THE GRANTING OF ANY SUCH CONSENT OR
APPROVAL.
36. EXPERT DETERMINATION
36.1. WITH RESPECT TO ANY FINANCIAL CALCULATIONS UNDER THIS LEASE, BUT NOT
FURTHER OR OTHERWISE IN CASE ANY CONTROVERSY ARISES BETWEEN THE PARTIES
HERETO AS TO ANY OF THE REQUIREMENTS OF THIS LEASE OR THE PERFORMANCE
THEREOF, AND THE PARTIES ARE UNABLE TO SETTLE THE CONTROVERSY BY
AGREEMENT OR AS OTHERWISE PROVIDED HEREIN, THE CONTROVERSY SHALL BE
REFERRED TO AN INDEPENDENT CHARTERED ACCOUNTANT ACTING AS EXPERT NOT
ARBITRATOR WHOSE DECISION SHALL BE FINAL AND BINDING UPON THE PARTIES
(SAVE AS TO MATTERS OF LAW).
36.2. SUCH CHARTERED ACCOUNTANT SHALL BE NOMINATED BY AGREEMENT BETWEEN THE
PARTIES OR IN DEFAULT OF SUCH AGREEMENT BY THE PRESIDENT FOR THE TIME
BEING OF THE AUSTRALIAN INSTITUTE OF CHARTERED ACCOUNTANTS ON THE
APPLICATION OF EITHER THE LESSOR OR THE LESSEE.
37. MISCELLANEOUS
37.1. NOTWITHSTANDING ANYTHING CONTAINED IN THIS LEASE, ALL CLAIMS AGAINST
AND LIABILITIES OF THE LESSEE OR THE LESSOR ARISING BEFORE ANY DATE OF
TERMINATION OF THIS LEASE SHALL SURVIVE SUCH TERMINATION.
37.2. IF ANY TERM OR PROVISION OF THIS LEASE OR ANY APPLICATION THEREOF IS
HELD INVALID OR UNENFORCEABLE, THE REMAINDER OF THIS LEASE AND ANY
OTHER APPLICATION OF SUCH TERM OR PROVISIONS SHALL NOT BE AFFECTED.
<PAGE> 95
37.3. IF ANY LATE CHARGES PROVIDED FOR IN ANY PROVISION OF THIS LEASE ARE
BASED UPON A RATE IN EXCESS OF THE MAXIMUM RATE PERMITTED BY APPLICABLE
LAW, THE PARTIES AGREE THAT SUCH CHARGES SHALL BE FIXED AT THE MAXIMUM
PERMISSIBLE RATE.
37.4. NEITHER THIS LEASE NOR ANY PROVISION HEREOF MAY BE CHANGED, WAIVED,
DISCHARGED OR TERMINATED EXCEPT BY A DEED OR AGREEMENT IN WRITING
SIGNED (IN EITHER CASE) BY THE LESSOR AND THE LESSEE.
37.5. ALL THE TERMS AND PROVISIONS OF THIS LEASE SHALL BE BINDING UPON AND
INURE TO THE BENEFIT OF THE PARTIES HERETO AND THEIR RESPECTIVE
SUCCESSORS AND ASSIGNS.
37.6. THE HEADINGS IN THIS LEASE ARE FOR CONVENIENCE OF REFERENCE ONLY AND
SHALL NOT LIMIT OR OTHERWISE AFFECT THE MEANING HEREOF.
37.7. THIS LEASE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE
LAWS OF NEW SOUTH WALES EXCEPT WHERE STATE SPECIFIC LEGISLATION APPLIES
IN WHICH CASE THE GOVERNING LAW WILL BE THAT OF THE RELEVANT STATE.
37.8. THE LESSEE AGREES THAT SERVICE OF PROCEEDINGS MAY BE EFFECTED UPON IT
UNDER ANY METHOD PERMISSIBLE UNDER THE LAWS OF NEW SOUTH WALES AND
IRREVOCABLY WAIVES ANY OBJECTION TO SUCH JURISDICTION.
37.9. THE LESSEE AGREES TO LOOK SOLELY TO THE LESSOR'S INTEREST IN THE LEASED
PROPERTY FOR RECOVERY OF ANY JUDGMENT FROM THE LESSOR, AND NO
CONSTITUENT SHAREHOLDER OR OFFICER OF THE LESSOR SHALL EVER BE
PERSONALLY LIABLE FOR ANY SUCH JUDGMENT OR FOR THE PAYMENT OF ANY
MONETARY OBLIGATION TO THE LESSEE. THE LESSOR (ORIGINAL OR SUCCESSOR)
SHALL NOT EVER BE LIABLE TO THE LESSEE FOR ANY INDIRECT OR
CONSEQUENTIAL DAMAGES SUFFERED BY THE LESSEE FROM WHATEVER CAUSE.
37.10. THE LESSEE WAIVES ANY DEFENCE BY REASON OF ANY DISABILITY OF THE
LESSEE, AND WAIVES ANY OTHER DEFENCE BASED ON THE TERMINATION OF THE
LESSEE'S (INCLUDING ANY THE LESSEE'S SUCCESSOR'S) LIABILITY FROM ANY
CAUSE. THE LESSEE WAIVES ALL DEMANDS FOR PERFORMANCE, NOTICES OF
<PAGE> 96
NONPERFORMANCE, PROTESTS, NOTICES OF PROTEST, NOTICES OF DISHONOUR, AND
NOTICES OF ACCEPTANCE, AND WAIVES ALL NOTICES OF THE EXISTENCE,
CREATION, OR INCURRING OF NEW OR ADDITIONAL OBLIGATIONS.
37.11. WHENEVER THE CONSENT OR APPROVAL OF THE LESSOR IS REQUIRED UNDER THIS
LEASE, THE LESSOR MAY IN ITS SOLE DISCRETION AND WITHOUT REASON
WITHHOLD THAT CONSENT OR APPROVAL UNLESS OTHERWISE SPECIFICALLY
PROVIDED.
37.12. DESPITE ANY OTHER PROVISIONS IN THIS LEASE TO THE CONTRARY, ALL OF THE
PURCHASE OPTIONS GRANTED TO THE LESSEE IN THIS LEASE:
37.12.1. ARE GRANTED SOLELY TO THE LESSEE AND ARE NOT ASSIGNABLE OR
TRANSFERABLE AND ANY ATTEMPT OTHERWISE TO ASSIGN OR TRANSFER
SUCH OPTIONS (OR ANY OF THEM) SHALL BE VOID AND OF NO FORCE
AND EFFECT. HOWEVER, IN EXERCISING AN OPTION, THE LESSEE CAN
NOMINATE AN ASSOCIATED COMPANY OF THE LESSEE AS THE PURCHASER
OF THE LEASED PROPERTY;
37.12.2. CAN ONLY BE EXERCISED BY THE LESSEE IF THE LESSEE PURCHASES
ALL OF THE LEASED PROPERTY TOGETHER WITH ALL OF THE LEASED
PROPERTY WHICH IS THE SUBJECT OF ANY SUPPLEMENTAL LEASE, ANY
GROUP LEASE AND ANY SUPPLEMENTAL LEASE TO SUCH GROUP LEASE.
37.13. EXCEPT AS PROVIDED IN TO THE CONTRARY, THE RESPECTIVE RIGHTS AND
REMEDIES OF THE PARTIES SPECIFIED IN THIS LEASE SHALL BE CUMULATIVE AND
IN ADDITION TO ANY RIGHTS AND REMEDIES NOT SPECIFIED IN THIS LEASE.
37.14. THERE ARE NO ORAL OR WRITTEN AGREEMENTS OR REPRESENTATIONS BETWEEN THE
PARTIES AFFECTING THIS LEASE. THIS LEASE SUPERSEDES AND CANCELS ANY AND
ALL PREVIOUS NEGOTIATIONS, ARRANGEMENTS, REPRESENTATIONS, BROCHURES,
AGREEMENTS AND UNDERSTANDINGS, IF ANY, BETWEEN THE LESSOR AND THE
LESSEE.
37.15. IF ANY PROVISION OF THIS LEASE OR THE APPLICATION OF SUCH PROVISION TO
ANY PERSON, ENTITY OR CIRCUMSTANCE IS FOUND INVALID OR UNENFORCEABLE BY
A
<PAGE> 97
COURT OF COMPETENT JURISDICTION, SUCH DETERMINATION SHALL NOT AFFECT
THE OTHER PROVISIONS OF THIS LEASE AND ALL OTHER PROVISIONS OF THIS
LEASE SHALL BE DEEMED VALID AND ENFORCEABLE.
37.16. ALL RIGHTS AND OBLIGATIONS OF THE LESSOR AND THE LESSEE UNDER THIS
LEASE SHALL EXTEND TO AND BIND THE RESPECTIVE HEIRS, EXECUTORS,
ADMINISTRATORS AND THE PERMITTED CONCESSIONAIRES, SUCCESSORS,
SUBTENANTS AND ASSIGNEES OF THE PARTIES. IF THERE IS MORE THAN ONE
LESSEE HEREUNDER, EACH SHALL BE BOUND JOINTLY AND SEVERALLY BY THE
TERMS, COVENANTS AND AGREEMENTS CONTAINED IN THIS LEASE.
37.17. EXCEPT FOR THE DELIVERY OF POSSESSION OF THE FACILITY TO THE LESSEE,
TIME IS OF THE ESSENCE OF ALL PROVISIONS OF THIS LEASE OF WHICH TIME IS
AN ELEMENT.
37.18. THE LESSEE SHALL:
37.18.1. ON DEMAND PAY TO THE LESSOR ALL PROPER AND REASONABLE COSTS,
CHARGES AND EXPENSES (INCLUDING LAWYERS' COSTS AND
DISBURSEMENTS, SURVEYORS' AND OTHER PROFESSIONAL FEES TOGETHER
WITH THE REASONABLE ADMINISTRATIVE CHARGES OF THE LESSOR)
INCURRED BY THE LESSOR IN RELATION TO THE PREPARATION AND
SERVICE OF A NOTICE REQUIRING THE LESSEE TO REMEDY A BREACH OF
ANY OF THE COVENANTS OR CONDITIONS CONTAINED IN THIS LEASE AND
ON THE PART OF THE LESSEE TO BE OBSERVED OR PERFORMED
(NOTWITHSTANDING FORFEITURE FOR SUCH BREACH SHALL BE AVOIDED
OTHERWISE THAN BY RELIEF GRANTED BY THE COURT);
37.18.2. ON DEMAND TO PAY TO THE LESSOR (AND ON A FULL INDEMNITY BASIS)
ALL COSTS, CHARGES AND EXPENSES, REASONABLY INCURRED OR
SUFFERED BY THE LESSOR (INCLUDING LAWYERS' COSTS AND
DISBURSEMENTS, SURVEYORS' AND OTHER PROFESSIONAL FEES, THE
REASONABLE ADMINISTRATIVE CHARGES OF THE LESSOR AND ANY COSTS
AND FEES PAYABLE TO ANY SUPERIOR THE LESSOR) IN CONNECTION
WITH:
<PAGE> 98
37.18.2.1. the grant by the Lessor of any consent or approval
under the covenants and conditions contained in
this Lease or the grant by any superior lessor of
any consent or approval under the covenants and
conditions contained in any superior lease or any
application for any such consent or approval;
37.18.2.2. any request by the Lessee in relation to the
Leased Property (including the approval of
drawings and specifications and the inspection or
supervision of works by or on behalf of the Lessor
or any Superior the Lessor); and
37.18.2.3. any breach of the covenants on the part of the
Lessee or the conditions contained in this Lease.
37.18.3. INDEMNIFY AND KEEP THE LESSOR INDEMNIFIED FROM AND AGAINST ALL
ACTIONS, CLAIMS, COSTS, DEMANDS, EXPENSES, LIABILITIES AND
LOSSES ARISING FROM ANY BREACH OF THE COVENANTS ON THE
LESSEE'S PART OR CONDITIONS CONTAINED IN THIS LEASE OR ANY
ACT, OMISSION OR DEFAULT IN RELATION TO THE LEASED PROPERTY BY
THE LESSEE OR ANY PERSON DERIVING TITLE UNDER THE LESSEE OR
ITS OR THEIR RESPECTIVE SERVANTS, AGENTS OR LICENSEES.
37.18.4. THE FOLLOWING SECTIONS OF THE CONVEYANCING ACT 1919 (NEW SOUTH
WALES) DO NOT APPLY TO THIS LEASE:
37.18.4.1. section 84;
37.18.4.2. section 84A;
37.18.4.3. section 85; and
37.18.4.4. section 86.
37.18.5. IN THIS LEASE WORDS USED IN ANY OF THE FORMS OF WORDS USED IN
THE FIRST COLUMN OF PART 2 OF SCHEDULE 4 OF THE CONVEYANCING
ACT 1919 (NEW SOUTH WALES) DO NOT IMPLY A COVENANT UNDER
SECTION 86 OF THE CONVEYANCING ACT 1919 (NEW SOUTH WALES).
<PAGE> 99
37.18.6. THE FOLLOWING SECTIONS OF THE PROPERTY LAW ACT 1974
(QUEENSLAND) DO NOT APPLY TO THIS LEASE:
37.18.6.1. section 105 (to pay rent and repair);
37.18.6.2. section 107 (landlord's right to enter, repair and
take possession); and
37.18.6.3. section 109 (short form covenants).
37.18.7. SECTIONS 80 AND 82 OF THE PROPERTY LAW ACT 1969 (WA) DO NOT
APPLY TO THIS LEASE.
37.19. THE REFERENCES TO ANY DOLLAR AMOUNTS IN THIS LEASE SHALL BE INCREASED
FROM TIME TO TIME DURING THE TERM AS DETERMINED BY THE LESSOR. IN
DETERMINING THE REVISED AMOUNTS THE LESSOR MUST ACT REASONABLY AND HAVE
REGARD TO (BUT SHALL NOT BE BOUND BY) INCREASES IN THE CONSUMER PRICE
INDEX. THIS CLAUSE SHALL NOT APPLY TO ANY DOLLAR AMOUNTS OF RENT OR
OUTGOINGS WHICH SHALL ONLY BE VARIED AS SPECIFICALLY PROVIDED FOR IN
THIS LEASE.
38. COMMISSIONS
38.1. THE LESSEE REPRESENTS AND WARRANTS TO THE LESSOR THAT NO REAL ESTATE
COMMISSION, FINDER'S FEE OR THE LIKE IS DUE AND OWING TO ANY PERSON IN
CONNECTION WITH THIS LEASE. THE LESSEE AGREES TO SAVE, INDEMNIFY AND
HOLD THE LESSOR HARMLESS FROM AND AGAINST ANY AND ALL CLAIMS,
LIABILITIES OR OBLIGATIONS FOR BROKERAGE, FINDER'S FEES OR THE LIKE IN
CONNECTION WITH THIS LEASE OR THE TRANSACTIONS CONTEMPLATED HEREBY,
ASSERTED BY ANY PERSON ON THE BASIS OF ANY STATEMENT OR ACT ALLEGED TO
HAVE BEEN MADE OR TAKEN BY THAT PARTY BY AND FROM THE LESSEE OR ANY
OTHER PARTY TO ANY OF THE TRANSACTION DOCUMENTS.
<PAGE> 100
39. GST
39.1. IF DURING THE TERM A GST IS INTRODUCED WHICH IS OR MAY BE LEVIED OR
BECOMES PAYABLE IN CONNECTION WITH THE SUPPLY OF THE LEASED PROPERTY OR
ANY GOODS, SERVICES OR OTHER THINGS BY THE LESSOR TO THE LESSEE UNDER
THIS LEASE, THE LESSOR AND THE LESSEE AGREE THAT THE GST WILL BE LEVIED
AND COLLECTED ON:
39.1.1. THE RENT; AND
39.1.2. THE ADDITIONAL CHARGES; AND
39.1.3. ANYTHING ELSE PAID FOR OR PROVIDED BY THE LESSOR TO THE LESSEE
UNDER OR IN CONNECTION WITH THIS LEASE.
39.1.4. ON OR AFTER THE LATER OF:
39.1.5. THE FIRST RENT REVIEW DATE UNDER CLAUSE 3.1 AFTER THE DATE OF
COMMENCEMENT OR OPERATION OF THE GST; OR
39.1.6. SUCH OTHER DATE PROVIDED FOR IN THE TRANSITIONAL PROVISIONS OF
THE LEGISLATION WHICH IMPOSES THE GST.
39.2. DESPITE ANY OTHER PROVISION IN THIS LEASE:
39.2.1. THE LESSOR IS ENTITLED TO REQUIRE THE LESSEE TO PAY IN
ADDITION TO:
39.2.1.1. the Rent; and
39.2.1.2. the Additional Charges; and
39.2.1.3. any other amounts payable by the Lessee to the
Lessor under or in connection with this Lease;
and recover from the Lessee; and
39.2.2. THE LESSEE MUST PAY THE LESSOR AT THE TIME THE RELEVANT RENT,
ADDITIONAL CHARGES OR OTHER AMOUNT IS PAYABLE;
<PAGE> 101
39.2.3. THE AMOUNT OF ANY GST WHICH IS:
39.2.4. LEVIED OR COLLECTED ON THE RENT; OR
39.2.5. LEVIED OR COLLECTED ON THE ADDITIONAL CHARGES; OR
39.2.6. LEVIED OR COLLECTED IN CONNECTION WITH ANYTHING ELSE FOR WHICH
THE LESSEE IS REQUIRED TO PAY, REIMBURSE OR INDEMNIFY THE
LESSOR UNDER OR IN CONNECTION WITH THIS LEASE OR FALLS WITHIN
MORE THAN ONE OF THOSE CATEGORIES.
39.3. TO THE EXTENT, IF ANY, TO WHICH THE PREVIOUS CLAUSES OF THIS LEASE DO
NOT OTHERWISE REQUIRE THE LESSEE TO PAY THE LESSOR AN AMOUNT EQUAL TO
ANY INPUT GST, THEN SO MUCH OF THE INPUT GST FOR WHICH THE LESSOR
CANNOT OBTAIN A CREDIT AGAINST ANY LIABILITY OF THE LESSOR TO GST IN
RESPECT OF THIS LEASE IS TO BE ADDED TO:
39.3.1. THE RENT; OR
39.3.2. THE ADDITIONAL CHARGES; OR
39.3.3. ANY OTHER AMOUNT THE LESSEE IS REQUIRED TO PAY, REIMBURSE OR
INDEMNIFY THE LESSOR UNDER THIS LEASE.
39.4. TO THE EXTENT THAT THIS LEASE DOES NOT OTHERWISE PROVIDE, THE LESSEE
WILL BE RESPONSIBLE FOR ANY OTHER TAX (INCLUDING WITHOUT LIMITATION A
SALES TAX ON SERVICES), IMPOST OR DUTY IMPOSED BY ANY LAW OF THE
COMMONWEALTH OF AUSTRALIA OR ANY STATE OR TERRITORY OF AUSTRALIA
(WHETHER IN FORCE PRIOR TO OR COMING INTO FORCE AFTER THE DATE OF THIS
LEASE) ON OR IN RESPECT OF THE LEASE, THE LEASED PROPERTY OR THE
LESSEE'S ACTIVITIES AT THE LEASED PROPERTY (EXCLUDING ANY INCOME TAX
PAYABLE BY THE LESSOR ON RECEIPT OF RENT OR ON OTHER AMOUNTS PAYABLE BY
THE LESSEE TO THE LESSOR UNDER OR IN CONNECTION WITH THIS LEASE OR ANY
CAPITAL GAINS TAX PAYABLE BY THE LESSOR ON THE DISPOSAL OF THE LEASED
PROPERTY).
<PAGE> 102
40. LESSOR'S OPTION TO ACQUIRE BUSINESS ASSETS
40.1. THE PROVISIONS IN SCHEDULE 7 SHALL HAVE EFFECT AS IF INCORPORATED IN
THIS LEASE.
41. ESSENTIAL TERMS
41.1. THE LESSEE'S OBLIGATIONS TO PAY MONEY UNDER THIS LEASE AND THE LESSEE'S
OBLIGATIONS UNDER PARTS 3, 4, 7, 8, 9, 10, 12, 13, 19, 22, 23, 39, 42
AND 44 ARE ESSENTIAL TERMS OF THIS LEASE. OTHER OBLIGATIONS OF THE
LESSEE MAY ALSO BE ESSENTIAL TERMS.
42. FIRST RIGHT OF REFUSAL TO LEASE
FIRST RIGHT OF REFUSAL FOR LESSEE
42.1. SUBJECT TO THE TERMS OF THIS CLAUSE 42, THE LESSOR GRANTS THE LESSEE A
RIGHT OF PRE-EMPTION TO TAKE A NEW LEASE OF THE LEASED PROPERTY FOR A
TERM COMMENCING THE DAY AFTER THE END OF THE TERM OF THIS LEASE. THE
RIGHT OF PRE-EMPTION CONTINUES ONLY UNTIL THE EXPIRATION OF THIS LEASE.
NO GRANT ANY MANAGEMENT RIGHTS OR LEASE BY THE LESSOR
42.2. THE LESSOR COVENANTS THAT IT SHALL NOT, BEFORE THE END OF THE TERM,
GRANT ANY LEASE OF THE LEASED PROPERTY FOR A TERM COMMENCING AFTER THE
TERM WITHOUT HAVING FIRST COMPLIED WITH THE RIGHT OF PRE-EMPTION IN
ACCORDANCE WITH THIS CLAUSE 42.
GIVING EFFECT TO THE PRE-EMPTION
42.3. IF THE LESSOR INTENDS TO GRANT A LEASE OF THE LEASED PROPERTY FOR A
TERM COMMENCING AFTER THE END OF THE TERM:
42.3.1. THE LESSOR SHALL SERVE ON THE LESSEE A WRITTEN NOTICE AT ANY
TIME DURING THE LAST 5 YEARS OF THE TERM OFFERING TO GRANT A
NEW LEASE OF THE LEASED PROPERTY TO THE LESSEE, SPECIFYING THE
TERMS AND CONDITIONS OF THE NEW LEASE AND
<PAGE> 103
FORWARDING WITH THE NOTICE A LEASE WHICH THE LESSOR IS
PREPARED TO SIGN CONTAINING THOSE TERMS AND CONDITIONS;
42.3.2. THE LESSOR'S OFFER TO GRANT A NEW LEASE OF THE LEASED PROPERTY
TO THE LESSEE SHALL CONSTITUTE AN IRREVOCABLE OFFER WHICH THE
LESSEE MAY ACCEPT WITHIN 30 DAYS AFTER SERVICE OF THE NOTICE
ON THE LESSEE;
42.3.3. THE LESSEE MAY ACCEPT THE LESSOR'S OFFER TO LEASE THE LEASED
PROPERTY BY DELIVERING TO THE LESSOR THE NEW LEASE SUBMITTED
BY THE LESSOR DULY EXECUTED BY THE LESSEE;
42.3.4. UPON ACCEPTANCE OF THE LESSOR'S OFFER BY THE LESSEE WITHIN 30
DAYS, THE PARTIES ARE BOUND BY THE NEW LEASE ON THE TERMS
CONTAINED IN THE NEW LEASE;
42.3.5. THE LESSOR WILL DELIVER TO THE LESSEE WITHIN 7 DAYS AFTER
RECEIPT OF THE NEW LEASE A COPY DULY EXECUTED BY THE LESSOR;
42.3.6. IF THE LESSEE DOES NOT ACCEPT THE LESSOR'S OFFER OF THE NEW
LEASE, THE LESSOR MAY GRANT THE NEW LEASE OF THE LEASED
PROPERTY TO A THIRD PARTY WITHIN 12MONTHS AFTER SERVICE OF THE
LESSOR'S WRITTEN NOTICE, ON TERMS AND CONDITIONS WHICH ARE NOT
LESS FAVOURABLE TO THE LESSOR THAN THE TERMS AND CONDITIONS ON
WHICH THE NEW LEASE WAS OFFERED TO THE LESSEE;
42.3.7. IF THE NEW LEASE OF THE LEASED PROPERTY IS NOT GRANTED BY THE
LESSOR IN ACCORDANCE WITH CLAUSE 42.3(F), AND SUBSEQUENTLY THE
LESSOR DESIRES TO GRANT A NEW LEASE OF THE LEASED PROPERTY,
THE LESSOR SHALL AGAIN COMPLY WITH THE PROVISIONS OF THIS
CLAUSE 42.
<PAGE> 104
43. POWER OF ATTORNEY
APPOINTMENT
43.1. THE LESSEE APPOINTS THE LESSOR, ANY DIRECTOR OR OFFICER OF THE LESSOR
AND ANY PARTNER IN THE FIRM OF SOLICITORS REPRESENTING THE LESSOR (AND
THE LESSOR'S SUCCESSORS AND ASSIGNS, BEING THE OWNER OF THE LEASE
PROPERTY FOR THE TIME BEING) AS THE LESSEE'S ATTORNEY WITH THE POWERS
CONTAINED IN THIS CLAUSE.
IRREVOCABLE POWER
43.2. THIS POWER OF ATTORNEY IS:
43.2.1. IRREVOCABLE BY THE LESSEE;
43.2.2. GRANTED BY THE LESSEE FOR VALUABLE CONSIDERATION (THE GRANT OF
THIS LEASE BY THE LEASE) TO SECURE THE PERFORMANCE OF THE
LESSEE'S OBLIGATIONS AND THE LESSOR'S PROPRIETARY INTEREST
OVER THE LEASED PROPERTY;
43.2.3. ONLY EXERCISABLE BY THE LESSOR WHERE THERE IS AN EVENT OF
DEFAULT.
EXTENT OF POWER - SPECIFIC
43.3. THE LESSOR AS THE LESSEE'S ATTORNEY AND IN THE NAME AND ON BEHALF OF
THE LESSEE MAY:
43.3.1. GRANT ONE OR MORE SUBLEASES OVER THE LEASED PROPERTY:
43.3.1.1. while the Lessee is the Lessee of the Leased
Property;
43.3.1.2. after the Lessee has vacated or abandoned the
Leased Property in breach of this Lease;
43.3.1.3. such sublease being:
(A) over the whole or any part of the Leased
Property; and
(B) limited to the duration of the then existing
term of this Lease binding the Lessee.
<PAGE> 105
43.3.2. TRANSFER THIS LEASE TO AN ASSIGNEE OF THE LEASE AND EXECUTE
ANY OTHER DOCUMENTS REASONABLY REQUIRED IN CONNECTION WITH THE
TRANSFER OF THIS LEASE, AFTER THE LESSEE VACATES OR ABANDONS
THE LEASED PREMISES, WHEN THIS LEASE IS NOT TERMINATED;
43.3.3. SURRENDER THIS LEASE AFTER;
43.3.3.1. the Lessor has become entitled to terminate this
Lease; and
43.3.3.2. the Lessee vacated or abandons the Leased Property;
or
43.3.3.3. the Lessor terminated this Lease by serving notice
of termination;
43.3.4. WITHDRAW ANY CAVEAT LODGED BY THE LESSEE IN RESPECT OF THIS
LEASE, AFTER THE LESSOR EFFECTIVELY TERMINATED THIS LEASE;
43.3.5. EXECUTE ANY DOCUMENT REQUIRED UNDER THE ESSENTIAL LEGISLATION
WHICH IS REQUIRED TO BE EXECUTED IN RELATION TO THE PRIMARY
INTENDED USE OF THE LEASED PROPERTY.
EXTENT OF POWER - GENERAL
43.4. THE LESSOR MAY:
43.4.1. ACT AS ATTORNEY UNDER THIS PART 43 DURING THE CONTINUANCE OF
THIS LEASE AND FOR THE PERIOD OF 6 MONTHS AFTER THE END OF
THIS LEASE;
43.4.2. REGISTER THIS LEASE (OR LEASE PROVISION) AS A POWER OF
ATTORNEY, AT ANY TIME INCLUDING AFTER THE TERMINATION OF THIS
LEASE, IF THAT IS REQUIRED FOR THE EXERCISE OF ANY POWER;
43.4.3. RATIFY AND CONFIRM ANY POWER WHEN EXERCISED UNDER THIS CLAUSE,
AS ATTORNEY AND AGENT FOR THE LESSEE.
<PAGE> 106
44. ESSENTIAL LEGISLATION
GENERAL
44.1. THE LESSOR AND THE LESSEE AGREE THAT THE RIGHTS AND OBLIGATIONS UNDER
THIS PART 44 ARE IN ADDITION TO AND SHALL NOT LIMIT THE GENERALITY OF
THE OTHER RIGHTS AND OBLIGATIONS UNDER THIS LEASE.
COMPLIANCE WITH ESSENTIAL LEGISLATION
44.2. THE LESSEE MUST PROMPTLY AND AT ITS OWN COST COMPLY WITH THE PROVISIONS
OF THE ESSENTIAL LEGISLATION IN SO FAR AS IT AFFECTS THE LEASED
PROPERTY (INCLUDING, BUT NOT LIMITED TO, THE USE OF THE LEASED PROPERTY
FOR THE PRIMARY INTENDED USE) PROVIDED THAT IF THE LESSEE HAS COMPLIED
FULLY WITH THE FOREGOING PROVISIONS OF THIS CLAUSE 44.2, IT SHALL NOT
BE DEEMED TO BE AN EVENT OF DEFAULT IF THE NUMBER OF BEDS SHALL BE
REDUCED AS A RESULT OF COMPLIANCE WITH ESSENTIAL LEGISLATION PROVIDED
ALWAYS THAT THE LESSEE IS NOT IN BREACH OF ANY OF THE COVENANTS
CONTAINED IN CLAUSES 3 OR 8 OF THIS LEASE.
DEBTS DUE TO GOVERNMENT
44.3. THE LESSEE COVENANTS AND WARRANTS TO THE LESSOR THAT THE LESSEE WILL BE
SOLELY RESPONSIBLE FOR AND MUST PAY ANY DEBTS DUE TO ANY GOVERNMENT OR
SEMI-GOVERNMENT AUTHORITY (INCLUDING ANY GRANTS WHICH MUST BE REPAID TO
ANY GOVERNMENT OR SEMI-GOVERNMENT AUTHORITY) AS REQUIRED UNDER THE
ESSENTIAL LEGISLATION.
TRANSFER OF APPROVALS
44.4. AT THE END OF THIS LEASE, INCLUDING TERMINATION DUE TO AN EVENT OF
DEFAULT, THE LESSEE MUST AT ITS COST PROMPTLY DO ALL THINGS NECESSARY
(INCLUDING HAVING APPROVALS REVOKED AND ISSUING NEW APPROVALS),
INCLUDING UNDER ESSENTIAL LEGISLATION, TO TRANSFER TO THE LESSOR (OR
SUCH OTHER PERSON NOMINATED BY THE LESSOR) SUCH APPROVALS WHICH HAVE
BEEN GRANTED TO OR ARE WITHIN THE CONTROL OF THE LESSEE.
<PAGE> 107
FUNDING
44.5. THE LESSEE MUST APPLY ALL FUNDING AND SUBSIDIES WHICH IT RECEIVES FROM
ANY GOVERNMENT OR SEMI-GOVERNMENT AUTHORITY UNDER ANY ESSENTIAL
LEGISLATION DIRECTLY FOR THE PURPOSE FOR WHICH THE FUNDING OR SUBSIDY
WAS GRANTED AND FOR NO OTHER PURPOSE.
COPIES OF NOTICES AND ORDERS
44.6. THE LESSEE MUST PROMPTLY GIVE THE LESSOR COPIES OF ALL REPORTS, NOTICES
AND ORDERS ISSUED UNDER THE ESSENTIAL LEGISLATION IN RELATION TO THE
LEASED PREMISES BY ANY GOVERNMENT OR SEMI-GOVERNMENT BODY.
INDEMNITY
44.7. TO THE FULLEST EXTENT PERMITTED BY LAW, THE LESSEE AGREES TO PROTECT,
INDEMNIFY, DEFEND AND SAVE HARMLESS THE LESSOR, ITS DIRECTORS,
OFFICERS, SHAREHOLDERS, AGENTS AND EMPLOYEES FROM AND AGAINST ANY AND
ALL FORESEEABLE OR UNFORESEEABLE LIABILITY, EXPENSE, LOSS, COSTS,
DEFICIENCY, FINE, PENALTY, OR DAMAGE, (INCLUDING WITHOUT LIMITATION
PUNITIVE OR CONSEQUENTIAL DAMAGES) OF ANY KIND OR NATURE, INCLUDING
PROPER LEGAL COSTS FROM ANY SUITS, CLAIMS OR DEMANDS, ON ACCOUNT OF ANY
MATTER OR THING, ACTION OR FAILURE TO ACT ARISING OUT OF ANY FAILURE BY
THE LESSEE TO COMPLY WITH ANY ASPECT OF THE ESSENTIAL LEGISLATION.
45. LIMITATION OF LIABILITY
ACKNOWLEDGMENT
45.1. THE PARTIES ACKNOWLEDGE AND AGREE THAT:
45.1.1. THE LESSOR HAS ENTERED INTO THIS LEASE IN ITS CAPACITY AS THE
TRUSTEE OF THE TRUST AND IN NO OTHER CAPACITY;
45.1.2. (SUBJECT TO CLAUSE 45.3) THE LESSOR IS NOT LIABLE TO PAY OR
SATISFY ANY OF ITS OBLIGATIONS UNDER THIS LEASE AND HAS NO
LIABILITY TO THE OTHER PARTIES EXCEPT TO THE EXTENT OF THE
LESSOR'S RIGHT OF INDEMNITY OUT OF THE ASSETS OF THE TRUST;
<PAGE> 108
45.1.3. IF THOSE ASSETS ARE INSUFFICIENT, THE LESSEE MAY NOT SEEK TO
RECOVER ANY SHORTFALL BY BRINGING PROCEEDINGS AGAINST THE
LESSOR PERSONALLY AND MAY NOT SEEK THE APPOINTMENT OF A
LIQUIDATOR, ADMINISTRATION OR ARRANGEMENT OF OR AFFECTING THE
LESSOR.
RELEASE
45.2. SUBJECT TO CLAUSE 45.3, THE LESSEE AND THE GUARANTOR WAIVE THEIR RIGHTS
AND RELEASE THE LESSOR FROM ANY PERSONAL LIABILITY WHATSOEVER IN
RESPECT OF ANY LOSS OR DAMAGE WHICH CANNOT BE PAID OR SATISFIED OUT OF
THE ASSETS OF THE TRUST.
PERSONAL LIABILITY
45.3. THE LESSOR IS LIABLE PERSONALLY AND IS NOT RELEASED TO THE EXTENT THAT
A LIABILITY UNDER THIS LEASE ARISES OUT OF THE LESSOR'S OWN FRAUD,
GROSS NEGLIGENCE, BREACH OF TRUST OR BREACH OF DUTY WHICH DISENTITLES
IT FROM ANY INDEMNITY OUT OF THE ASSETS OF THE TRUST IN RELATION TO THE
RELEVANT LIABILITY.
LIABILITY LIMITED UNDER LEASE
45.4. DESPITE ANY OTHER PROVISION OF THIS LEASE, THE LIABILITY OF THE LESSOR
IS LIMITED BY THE PROVISIONS OF CLAUSES 45.1 TO 45.3. IN THE EVENT OF
ANY INCONSISTENCY WITH ANY OTHER PROVISION OF THIS LEASE, THESE CLAUSES
ARE PARAMOUNT.
NO AGENCY
45.5. NO AGENT OF THE LESSOR HAS AUTHORITY TO ACT ON BEHALF OF THE LESSOR IN
A WAY WHICH EXPOSES THE LESSOR TO ANY PERSONAL LIABILITY. NO ACT OR
OMISSION OF ANY SUCH PERSON WILL BE OF ITSELF CONSIDERED FRAUD,
NEGLIGENCE, BREACH OF TRUST OR BREACH OF DUTY OF THE LESSOR FOR THE
PURPOSE OF CLAUSE 45.3.
<PAGE> 109
46. YEAR 15 OPTION
OPTION
46.1. THE LESSEE SHALL HAVE THE OPTION ON THE OPTION DATE ("YEAR 15 OPTION")
TO PURCHASE THE LEASED PROPERTY ON THE TERMS OF THIS PART 46 IF:
46.1.1. THE LESSEE SIGNS AND RETURNS TO THE LESSOR A NOTICE IN THE
FORM OF THE OPTION NOTICE IN SCHEDULE 5 TO THIS LEASE (AMENDED
TO REFER TO THIS PART 46) ("YEAR 15 OPTION NOTICE");
46.1.2. THE LESSOR RECEIVES THE YEAR 15 OPTION NOTICE NOT MORE THAN 12
MONTHS AND NOT LESS THAN 6 MONTHS BEFORE THE OPTION DATE;
46.1.3. THE LESSEE CONTEMPORANEOUSLY GIVES THE LESSOR A YEAR 15 OPTION
NOTICE UNDER EACH SUPPLEMENTAL LEASE, EACH GROUP LEASE AND
EACH SUPPLEMENTAL LEASE TO SUCH GROUP LEASE;
46.1.4. WHEN THE LESSEE GIVES THAT NOTICE, AND ON THE TERMINATING
DATE, IT IS NOT IN BREACH OF THIS LEASE, ANY GROUP LEASE OR
ANY SUPPLEMENTAL LEASE TO ANY GROUP LEASE.
PROVISIONS TO APPLY
46.2. THE PROVISIONS OF PART 18 OF THIS LEASE SHALL APPLY TO THE EXERCISE OF
THE YEAR 15 OPTION WITH THE FOLLOWING VARIATIONS:
46.2.1. "COMPLETION DATE" MEANS WITHIN 3 CALENDAR MONTHS AFTER THE
OPTION DATE.
46.2.2. THE PURCHASE PRICE OF THE LEASED PROPERTY SHALL BE AN AMOUNT
EQUAL TO THE REPURCHASE PRICE PLUS ALL RENT THEN DUE AND
PAYABLE AND ALL OTHER SUMS DUE UNDER THE TERMS OF THIS LEASE
FROM THE LESSEE TO THE LESSOR AS AT THE DATE OF COMPLETION OF
THE PURCHASE.
<PAGE> 110
46.2.3. THE PROVISIONS OF SCHEDULE 6 SHALL APPLY TO ANY AGREEMENT FOR
SALE AND PURCHASE ARISING UNDER THIS PART 46.
46.2.4. THE LESSOR SHALL NOT BE OBLIGED TO COMPLETE THE SALE OF THE
FREEHOLD IN PART ONLY NOR TO COMPLETE THE SALE OTHERWISE THAN
CONTEMPORANEOUSLY WITH COMPLETION OF THE SALES UNDER THE
CORRESPONDING PROVISIONS OF EACH SUPPLEMENTAL LEASE, EACH
GROUP LEASE AND EACH SUPPLEMENTAL LEASE TO SUCH GROUP LEASE.
<PAGE> 111
SCHEDULE ONE
DICTIONARY
"Accounts" means the audited balance sheet and profit and loss account of any
Person made up to its accounting reference date in any year (or the equivalent
in relation to a Person that is not a company incorporated in Australia)
together with the notes and reports forming part of the accounts (if any).
"Act" means the Aged Care Act 1997 (Cth).
"Additional Charges" means:
(a) all Outgoings as provided in clause 4.1;
(b) all other amounts, liabilities and obligations which the Lessee assumes
or agrees to pay under this Lease; and
(c) all fines, penalties, interest and costs which may be lawfully payable
for nonpayment or late payment of the amounts referred to in (a) and (b)
above.
"Aged Care Place" means a "place" (as that term is defined in the Act) allocated
or transferred to a person pursuant to the Act in respect of a Facility and
which has not been relinquished, revoked, surrendered or otherwise ceased to
have effect pursuant to the Act .
"Agreed Amount" means the Initial Agreed Amount and in addition any Agreed
Amount as referred to in any Supplemental Lease.
"Approvals" includes all Aged Care Places, licences, consents, registrations,
certifications, accreditations and approvals relevant to the use and operation
of each Facility for the Primary Intended Use in compliance with all applicable
Legal Requirements.
"Associated Company" means with respect to any Person:
(a) any Person directly or indirectly controlling, controlled by or under
common control with such Person;
(b) any executive officer, director or general partner of such Person; or
(c) any Person who is an executive officer, director, general partner, or
trustee of any Person described in paragraphs (a) and (b) and "control"
(including with correlative meanings, the terms "controlling",
"controlled by" and "under common control with"), as used with respect to
any Person, shall mean the possession, directly or indirectly, of the
power to direct or cause the direction of the management and policies of
such Person, whether through the ownership of voting securities or by
contract or agency or otherwise but such Person shall only be deemed to
have control over another if it owns directly or indirectly 51% of the
issued shares or other voting ownership rights in such Person.
For the purpose of determining an "Associated Company" of the Lessee, the
definition shall exclude any company which is situated above Moran Health Care
Group Pty Limited in the Lessee's company structure.
<PAGE> 112
"Assumed Indebtedness" means any indebtedness or other obligations of the
Lessor, secured by an Encumbrance over the freehold in the Leased Property.
"Award" means all compensation, sums or anything of value awarded, paid or
received on a total or partial condemnation.
"Balance of the Term" means the period from the date of termination of the Lease
until the Terminating Date.
"Bed" means a bed at a Facility the provision of which is provided for under the
terms of an Approval pursuant to the Essential Legislation.
"Business Day" means any day except a bank or public holiday throughout New
South Wales or a Saturday or Sunday.
"Cash Flow" means for any financial year of the Lease, the sum of:
(a) Net Income of the Lessee for such period attributable to the Leased
Properties (when calculating such Net Income for the purpose of this
definition only, the Lessee shall be deemed to deduct from gross income
Management Fees equal to 4% of gross revenues in accordance with General
Standards for such period by way of allowance for central office
overheads whether or not actual central office overheads exceed or are
less than the said 4% and for the avoidance of doubt, such actual central
office overheads shall be excluded when calculation such Net Income);
(b) the amount of depreciation and amortisation which was deducted in
computing such net income; and
(c) Rent, reduced by capital expenditures for such period (and in no event
less than $300 per Bed per annum).
"Clean Up" means the removal and/or remediation and/or elimination of, or other
response to, Contamination to the satisfaction of all applicable governmental
agencies, in compliance with Environmental Laws and in compliance with good
environmental management and prudent commercial practice.
"Commencement Date" means the date of this Lease.
"Condemner" means any public or quasi-public authority, or private corporation
or individual, having the power of effecting any Seizure Matter.
"Consumer Price Index" means the index of underlying inflation, as defined by
the Commonwealth Treasury and published by the Australian Bureau of Statistics
or if such index is not published then the nearest approximate index to be
determined by the Lessor in the Lessor's reasonable discretion.
<PAGE> 113
"Contamination" means the presence (or absence) of any Hazardous Substance or
the existence of any injury to health, safety or the environment or any other
environmental condition at, in, or under the Leased Property, or any Release at,
in, on, from or to the Leased Property, either in breach of Environmental Laws
or at the time of expiration or earlier termination of the Term of this Lease,
which would be reasonably required to be removed (or added) to ensure that no
environmental matter restricts the present or future use, operation, leasing,
development, construction, alteration, refinancing or sale of the Leased
Property.
"Current Assets" means at any date, all assets of the Lessee that in conformity
with General Standards should be classified as current assets at such date.
"Current Liabilities" means at any date, all liabilities of the Lessee that in
conformity with General Standards should be classified as current liabilities at
such date.
"Date of Taking" means the date the Condemner has the right to possession of the
Facility.
"Debt" excludes any letter of credit for any Rent deposit payable by the Lessee
and means as applied to any Person:
(a) any obligation for the payment or repayment of money, whether present,
future or actual, in respect of:
(i) money borrowed, raised, advanced or paid; or
(ii) any bond, note, loan stock, debenture or similar instrument; or
(iii) any acceptance or documentary letter of credit facility; or
(iv) deferred payment (for more than 90 days) for any service or
asset; or
(vii) guarantees and other assurances against financial loss in respect
of any Financial Indebtedness of the kind referred to in
paragraphs (i) to (vi) above inclusive of any person;
(b) that portion of obligations with respect to Finance Leases (for the
avoidance of doubt, excluding this Lease) which is properly classified as
a liability on a balance sheet in conformity with General Standards;
(c) any obligation owed for all or any part of the deferred purchase price of
property or services which purchase price is
(i) due more than three months from the date of incurrence of the
obligation in respect thereof; or
(ii) evidenced by a note or similar written instrument; and
<PAGE> 114
(d) all indebtedness secured by any lien (other than a lien, arising by
operation of law) on any property or asset owned or held by that Person
regardless of whether the indebtedness secured thereby has been assumed
by that Person or is non-recourse to the credit of that Person.
"Debt Service" means as of the end of any accounting period, the sum of
(a) all (in the case of an annual period) or one-fourth (in the case of a
quarterly period) of Long Term Obligations Due Within One Year as of the
end of such period; and
(b) Rent.
"Dictionary" means the dictionary contained in Schedule One to this Lease.
"Disposal" means disposal or deemed disposal pursuant to the Tax Act.
"Encumbrance" means any mortgage, charge, deed of trust, lien or encumbrance
securing any borrowing or other means of financing or refinancing, contract of
sale or other matter affecting title to the Leased Property, or any portion
thereof or interest therein.
"Environmental Documents" means each and every one of the following:
(a) each and every document received by the Lessee or any Associated Company
from, and each and every document submitted by the Lessee or any
Associated Company to any environmental health authority or agency or
concerning safety in environmental matters with respect to the condition
of the Leased Property, or the Lessee's operations upon the Leased
Property; and
(b) each and every review, audit, report, or other analysis concerning
environmental conditions, including, but not limited to Contamination at,
in, or under or with respect to the Leased Property that have been
prepared by or on behalf of or for the benefit of the Lessee.
"Environmental Laws" means each and every law (including, without limitation,
common law), statute, code, ordinance, regulation, rule, order permit, consent
decree or other requirement (including, but not limited to, consent decrees and
judicial or administrative orders), and any other executive, judicial,
regulatory or administrative agency, authority, board, bureau, commission,
court, arbitrator or arbitration board, relating to health or safety or to the
environment, including, but not limited to, those applicable to the manufacture,
processing, transportation, distribution in commerce, use, generation, storage,
treatment, disposal, handling and Release of any Hazardous Substance including
medical waste, all as amended or modified from time to time, and those
applicable to pollution, contamination, injury, destruction, loss, protection,
cleanup, reclamation or restoration of the soil, ground water, surface water,
air or other natural resources, to exposure to pollutants, contaminants,
hazardous or toxic substances, petroleum products, materials or wastes.
<PAGE> 115
"Environmental Report" means the environmental review, audit and/or report
relating to the Leased Property to be provided by the Lessee to the Lessor.
"Essential Legislation" means:
(a) the Act, Aged or Disabled Persons Care Act 1954(Cth), National Health Act
1953(Cth);
(b) Nursing Homes Act 1988 (NSW), Health Care Complaints Act 1993 (NSW),
Retirement Villages Act 1989 (NSW);
(c) Hospital and Health Services Act 1927 (WA), Retirement Villages Act 1992
(WA), Health Act 1911 (WA), Health Services (Conciliation and Review) Act
1995 (WA);
(d) Health Act 1937 (Qld), Retirement Villages Act 1937 (Qld), Health Rights
Commission Act, 1991 (Qld),
and includes any subsequent statutory re-enactment or modification of any such
Act and any order, regulation, directive, by-law, rule, consent or Approval made
or granted under such Act or by any public or local authority acting in its
official capacity or by any court of competent jurisdiction or any other Act,
order, regulation, directive, by-law, rule, consent or Approval which in any way
affects the use of the Leased Property for the Primary Intended Use.
"Event of Default" has the meaning defined in Part 16 and as otherwise
specifically provided in this Lease.
"Excluded Personal Property" means all of the chattels at the Leased Property on
the Commencement Date other than the Lessor's Personal Property and includes the
Residents Personal Property .
"Facility" means a registered nursing home/residential care facility and any
other aged care or health care related facility both currently or subject to the
terms of this Lease subsequently operated at the Leased Property including the
Lessee's Personal Property, the Lessor's Personal Property and the Fixtures
located in the Facility.
"Facility Mortgage" any Encumbrance placed on the Leased Property in accordance
with the provisions of Part 35.
"Facility Mortgagee" means any holder of any mortgage deed of trust or other
security agreement securing any Assumed Indebtedness.
"Finance Lease" means any lease of any property (whether real or moveable) to
any Person which would, in accordance with General Standards, be required to be
accounted for as a lease on the balance sheet of that Person.
"Fixtures" means all plant and equipment fixed to the Leased Property.
"Full Replacement Cost" means the Lessor's estimate from time to time of, or
such (if any) higher figure as the Lessor may from time to time specify by
Notice to the Lessee as, the actual replacement cost of the Leased Property
including without limitation allowance for inflation
<PAGE> 116
in building costs, demolition and site clearance expenses for temporary support
and protection costs of compliance with local authority requirements architects
surveyors and other professional fees and all other incidental expenses and GST
on any of the foregoing an increased cost of construction endorsement, less
exclusions provided in the standard form of fire insurance policy.
"General Standards" means generally accepted accounting principles consistent
with those applied in the preparation of financial statements in Australia and
other mandatory professional reporting requirements.
"Gross Cash Flow" means for any period of the Term, the sum of:
(a) Net Income of the Lessee (before any deduction for Management Fees) for
such period attributable to the Leased Properties;
(b) the amount of depreciation and amortisation which was deducted in
computing such net income; and
(c) Rent for the period.
"Group Company" means the Lessee, the Guarantor and any person who at any time
before on, or after the date of this Lease is a Related Body Corporate of the
Lessee (as the context may require).
"Group Lease" means this Lease and each other present or future lease:
(a) which is granted by an Omega Company to a Group Company before, on or
after the date of this Lease;
(b) otherwise in relation to which, at any time before, on or after the date
of this Lease, an Omega Company is the lessor and a Group company is the
lessee; or
(c) which the Lessor and the Lessee and (if required by the Lessor) any
Guarantor otherwise have agreed or may agree in writing shall be
designated a Group Lease,
and includes:
(a) the Lease between the Lessor and the Lessee dated 19 June 1998;
(b) the Lease between the Lessor and the Lessee of the Other Properties.
"Guarantor" means Moran Health Care Group Pty Limited (ACN 008 585 242) and any
other person who during the Term acts as surety or guarantor of the Lessee (and
whether or not as a primary obliger).
"GST" means goods and services tax, consumption tax, value added tax or any
similar tax, impost or duty imposed by any law of the Commonwealth of Australia
or any State or Territory of Australia (whether in force before or coming into
force after the date of this Lease).
<PAGE> 117
"Hazardous Substances" means any dangerous, toxic or hazardous material,
petroleum products, pollutants, contaminant, chemical, waste including medical
waste or substance defined, listed or described as any of such in or governed by
any Environmental Law.
"Initial Agreed Amount" means $72,500,000.
"Input GST" means the GST which is charged or levied by any Person on goods,
services or other things acquired by the Lessor concerning the goods, services
and other things which the Lessor, in turn, provides to the Lessee under this
Lease.
"Insurance Requirements" means all terms of any insurance policy required by
this Lease and all requirements of the issuer of any such policy.
"Insured Risks" means fire, explosion, storm, tempest (including lightning),
flood, burst pipes, impact and (in peacetime) aircraft and articles dropped from
aircraft, riot and civil commotion and any other risks against which the Lessor
or any Facility Mortgagee may from time to time require the Lessee to effect
insurance in respect of the Leased Properties.
"Land" means the land described in Schedule 2 and in any Supplemental Lease.
"Lease" means this Lease any Supplemental Lease and any other deed expressed to
be supplemental hereto and includes any schedules and Exhibits hereto or
thereto.
"Lease Guarantee" means the lease guarantee given by the Guarantor in respect of
the Obligations dated the same date as this Lease and includes a guarantee given
in respect of any Group Lease.
"Lease Year" means the period from 1st July in each year of the Term (but from
the date of this Lease in the case of the first year of the Term) to 30th June
in the next following calendar year.
"Leased Property" means the Land, each Facility, the Lessor's right, title and
interest (if any) in each Aged Care Place, the Fixtures and the Lessor's
Personal Property. If any such assets shall cease to be subject to this Lease
before the expiration or sooner determination of the Term, the assets will cease
to be part of the Leased Property and the definitions of Property, Facility,
Fixtures and the Lessor's Personal Property shall be modified accordingly.
"Legal Charge" means any legal mortgage made between the Lessee and the Lessor
relating to this Lease.
"Legal Requirements" includes the Environmental Laws, the Essential Legislation
and the Planning Acts and means every other Act of Parliament or requirement of
any local or government authority or agency relating to or affecting the Leased
Property or the ownership use, construction, operation, maintenance, lease,
sublease, repair, rebuilding, occupation or alteration thereof or the employment
or residence therein of any person or otherwise howsoever relating to the Leased
Property or the interest of the Lessor, the Lessee or any third party in the
Leased Property.
<PAGE> 118
This definition includes, unless a contrary intention is stated, (without
limitation) every Act of Parliament whether named in this Lease or not or
whether in force today or not and any subsequent statutory re-enactment or
modification of any Act of Parliament and any order, regulation, directive,
by-law, rule, consent or licence made or granted under any Act of Parliament or
by any public or local authority acting in its official capacity) or by any
court of competent jurisdiction.
"Lessee" means Moran Health Care (Australia) Pty Limited (ACN 082 466 457) and
its successors in title and assigns.
"Lessee's Certificate" means a statement in writing in substantially the same
form of Schedule 4 attached hereto (with such changes thereto as may reasonably
be requested by the Person relying on such certificate qualified as may be
necessary to render such certificate true).
"Lessee's Personal Property" means all tangible moveable personal property
acquired by the Lessee for use in connection with each Facility, except the
Lessor's Personal Property, Fixtures and Replacement Property.
"Lessor" means Principal Healthcare Finance Pty Limited (ACN 069 875 476)
(formerly known as Premier Care Australia Pty Limited) and its successors in
title and assigns.
"Lessor's Personal Property" means all of the assets and chattels at the Leased
Property on the Commencement Date.
"Long Term Obligations Due Within One Year" means as of any date, all Debt of
the Lessee that in conformity with the General Standards should be classified as
long-term obligations due within one year of such date.
"Management Contract" means any agreement or arrangement under which any Person
(not being an employee, officer or director of the Lessee) is appointed to
manage on behalf of the Lessee the whole of any Facility.
"Management Fees" means fees paid to any Person (not being an officer, director
or employee of the payer) for the management of the whole of any Facility or
Facilities to a maximum amount of 4% of the Lessee's gross revenue per annum
(calculated in accordance with General Standards).
"Maximum Rent Apportionment" means in relation to any Leased Property such
amount as represents the product of the following formula:
RP x R
where RP is the amount of the Repurchase Price of the Leased Property (to which
the apportionment in question is made) at the relevant time and R is the product
of the Rent divided by the Initial Agreed Amount.
"Minimum Capital Expenditure" means the sum required to be expended each Lease
Year by the Lessee in accordance with Part 8.
<PAGE> 119
"Minimum Continuing Rent" means in relation to any Leased Property such amount
as represents the product of the following formula:
RP x 9.6
---
100
where RP is the amount of the Repurchase Price of the relevant Facility or
Leased Property (to which the apportionment in question is made) at the relevant
time.
"Minimum Tangible Net Worth" means initially $500,000 increasing on the first
day of each fiscal period of the Lessee on a cumulative basis by an amount equal
to:
(a) (whilst the Tangible Net Worth of the Lessee is less than or equal to
$3,000,000) 30% of the post tax profits of the Lessee as disclosed in the
Lessee's Accounts for the immediately preceding fiscal period of the
Lessee;
(b) (when the Tangible Net Worth of the Lessee exceeds $3,000,000) such
percentage as equals the percentage by which the Consumer Price Index
published on the last published date before commencement of that Lease
Year exceeds the corresponding Consumer Price Index published on the last
published date before commencement of the immediately preceding Lease
Year.
"Net Income" means the net income derived from the operation of the Leased
Properties, determined on an accrual basis in accordance with General Standards
before tax but excluding extraordinary items.
"Net Proceeds" means all proceeds received by reason of any loss or damage to
the Leased Property, or any portion thereof, insured under any policy of
insurance required by Part 13 of this Lease, net of any costs incurred by the
Lessor in obtaining such proceeds.
"Notice" means any notices, demands, requests, consents, approvals and other
communications given pursuant to Part 31 of this Lease.
"Obligations" means the Lessee responsibilities, duties and obligations under
this lease and at law.
"Officer's Certificate" means a certificate of the Lessee signed by one or more
directors of the Lessee.
"Omega Company" means the Lessor and any person who is at any time before on or
after the date of this Lease is a Related Body Corporate of the Lessor (as the
context may require).
"Option Date" means 19 June 2013.
"Option Notice" means a notice in the form of a Notice set out in Schedule 5 of
this Lease.
"Other Properties" means the properties described in Schedule 3 to this Lease.
<PAGE> 120
"Outgoings" means collectively, all rates, taxes, assessments, duties,
outgoings, impositions and charges whatsoever, water, sewer or other rents and
charges, excises, tax levies, fees (including, without limitation, registration,
licence, permit, inspection, authorisation and similar fees), and all other
governmental or local charges, in each case whether general or special, ordinary
or extraordinary, foreseen or unforeseen, of every character in respect of the
Leased Property or the business conducted thereon by the Lessee and/or the Rent
(including all interest and penalties thereon due to any failure in payment by
the Lessee), which at any time before, during or in respect of the Term hereof
may be assessed or imposed on or in respect of
(a) the Lessor or the Lessor's interest in the Leased Property,
(b) the Leased Property or any part thereof or any rent therefrom or any
estate, right, title or interest therein,
(c) any occupancy, operation, use or possession of, or sales from, or
activity conducted on, or in connection with the Leased Property or the
leasing or use of the Leased Property or any part thereof, or
(d) the Rent.
Not included in the definition of Outgoings are:
(a) income tax, company tax and capital gains tax and any other taxes
(whether taxes of Australia, New South Wales, Queensland, Western
Australia or foreign taxes) charged on the income, profits or gains of
the Lessor in respect of Rent paid under this Lease or any disposal by
the Lessor of the freehold interest in the Leased Property of any part
thereof;
(b) GST (which is expressly dealt with in the Lease); and
(c) withholding taxes.
"Overdue Rate" means on any date, a rate equal to five percentage points above
the average bid rate for bills (as defined in the Bills of Exchange Act 1901
(Cwth)) which is displayed on the page of the Reuters Monitor System designated
"BBSY" but in no event greater than the maximum rate then permitted under
applicable law.
"Payment Date" means any due date for the payment of the instalments of Rent,
Additional Charges, or any other sums payable under this Lease.
"Person" means any natural person, trust, partnership, company, corporation,
joint venture or other legal entity.
"Planning Acts" means:
(a) the Local Government Act 1993 (NSW), the Environmental Planning and
Assessment Act 1979 (NSW);
(b) Integrated Planning Act 1997 (Qld), Town Planning Scheme for the City of
Caloundra, and Town Planning Scheme for the Shire of Maroochy;
<PAGE> 121
(c) Town Planning and Development Act 1928 (WA), Metropolitan Region Town
Planning Scheme Act 1959 (WA), Local Government Act 1995 (WA), Local
Government (Miscellaneous Provisions) Act 1960 (WA), Heritage of Western
Australia Act 1990 (WA), Environmental Protection Act 1986 (WA),
all statutory town planning schemes and all subsidiary legislation including
regulations made under the above Acts.
"Present Value" of any amount means such amount as may be agreed between the
parties at its present value (being discounted to reflect accelerated payments
and so reflect appropriate damages) as at the date of termination of the Lease
having regard to relevant information about prevailing interest rates for the
Balance of the Term, or, in default of such agreement, as may be determined in
accordance with Part 36.
"Primary Intended Use" means use as an aged care facility, assisted and
self-care aged living accommodation, nursing home, hostel, retirement village or
residential care home (including the provision of health and nursing services)
in accordance with the certificate or certificates of registration existing on
the date of this Lease in respect of the Facilities pursuant to the Essential
Legislation or if such legislation is repealed and not replaced by equivalent
legislation of like effect as a high class aged care facility, assisted and
self-care aged living accommodation, nursing home, hostel, retirement village or
residential care home.
"Registrar General" means the Registrar General of the Land Titles Office of New
South Wales.
"Regulatory Actions" means any claim, demand, action or proceeding brought or
instigated by any government authority in connection with any Environmental Law,
including, without limitation, civil and/or criminal administrative proceedings,
and whether or not seeking costs, damages, penalties or expenses.
"Related Body Corporate" has the same meaning as that given in the Corporations
Law.
"Release" means the intentional or unintentional spilling, leaking, dumping,
pouring, emptying, seeping, disposing, discharging, emitting, depositing,
injecting, leaching, escaping, abandoning, or any other release or threatened
release, however defined, of any Hazardous Substance.
"Rent" means the initial rent of $6,960,000 and such increased amount in
subsequent Lease Years as referred to in Part 3 and also includes (in addition)
the yearly rent from time to time reserved by each Supplemental Lease.
"Rent Deposit Account" means any bank account under the control of the Lessor
and maintained by the Lessee pursuant to any rent deposit deed made between the
Lessee and the Lessor and supplemental to this Lease.
"Replacement Property" means any operational equipment or parts or property of
the Fixtures or Lessor's Personal Property which have been replaced by the
Lessee under clause 9.11.
<PAGE> 122
"Replaced Property" means any of the Fixtures or the Lessor's Personal Property
which have:
(a) become worn out, obsolete or unusable for the purpose for which it is
intended; or
(b) been lost or stolen damaged or destroyed (subject to Part 14).
"Repurchase Price" means a purchase price in respect of a Leased Property equal
to the multiple of 10 times the Rent payable immediately before the date of
completion of the purchase of the Leased Property.
"Residents' Personal Property" means all of the chattels at the Leased Property
on the Commencement Date owned by the residents of the Leased Property.
Sale Assets means the Leased Property.
"Security Agreement" means a fixed and floating charge granted on the date of
this Lease between the Lessee and the Lessor.
"Seizure Matter" means if (whether by order of any government or authority or
otherwise) the Leased Property or any material part thereof shall be dismantled,
confiscated, compulsorily required, vested, burdened by an easement or
restrictive covenant, seized or appropriated or otherwise permanently or for any
material period closed or taken out of the possession or control of the Lessee
or the Lessor but excluding taking of possession by any mortgagee.
"Supplemental Lease" means any lease or underlease between the Lessor and the
Lessee (and whether or not a Guarantor shall be party thereto) expressed to be
supplemental to this Lease.
"Taking" means a notice to treat, notice of entry or any compulsory purchase or
vesting or any Seizure Matter of all or part of the Leased Property, or any
interest therein or right accruing thereto or use thereof, affecting the Leased
Property whether or not the same shall have actually been commenced.
"Tangible Net Worth" means at any date in respect of any Person, the net worth
of that Person as determined in conformity with the General Standards (but
recording debt that is subordinated to all liabilities of the Person as equity
or in the case of a company ordinary share capital including debt that is
subordinated in accordance with clause 8.4 or clause 8.7 or any subsequent
subordination agreement between the Lessor and the Lessee which is in
substantially the same form as the subordination agreements referred to in
clauses 8.4 and 8.7), less the consolidated Intangible Assets of that Person, as
determined at such date. For purposes of this definition, "Intangible Assets"
means the amount of
(a) all unamortised debt discount and expense, unamortised deferred charges,
goodwill, patents, trademarks, service marks, trade names, copyrights,
organizational and developmental expenses, unamortised operating rights,
unamortised licences, unamortised leasehold rights and other intangible
assets; or depreciation and any write-up resulting from a change in
methods of accounting or inventory; and
(b) the amount of any investment in any Associated Company.
<PAGE> 123
For the purpose of calculating Tangible Net Worth there may be taken into
account to the extent consistent with the General Standards the amounts standing
to the credit of any Rent Deposit Account.
"Tax" means any present or future tax, levy, impost, deduction, charge, duty,
compulsory loan or withholding (together with any related interest, penalty and
fine in connection with any of them) levied or imposed by any government agency,
other than those imposed on overall net income;
"Tax Act" means the Income Tax Assessment Act 1936 and includes the Income Tax
Assessment Act 1997, and in either case where amended, re-enacted or replaced
that amended, re-enacted or replacement legislation.
"Term" means the term of 30 years from and including the Term Commencement Date.
"Term Commencement Date" means the date of this lease.
"Terminating Date" means the date which is 30 years after the Term Commencement
Date.
"Third Party Claims" means any claims, actions, demands or proceedings (other
than Regulatory Actions) howsoever based on (including without limitation) those
based on negligence, trespass, strict liability, nuisance, toxic tort or
detriment to health, welfare or property) due to Contamination, and whether or
not seeking costs, damages, penalties or expenses, brought by any person or
entity other than a governmental agency.
"Transaction Documents" means:
o the Relationship Agreement (so called) between Omega Worldwide, Inc, the
Guarantor and various other parties; and
o the Lease Guarantee (so called) between the Lessor and the Guarantor; and
o the contract for the sale of land for the Other Properties dated the same
date as this Lease; and
o the Agreement for Lease of the Other Properties dated the same date as
this Lease; and
o the Capital Contribution Agreement (so called) between the Lessee, the
Lessor and the Guarantor,
all dated on or about the same date as this Lease.
"Trust" means the trust known as the "Principal Healthcare Finance Trust"
(formerly known as the "Assisted Living Unit Trust") constituted by a deed of
trust dated 11 August 1995 between Assisted Living (Holdings) Pty Limited (now
named Principal Healthcare Finance Pty Limited) as trustee and Metlife Australia
(Holdings) Pty Limited (now named Premier Care Australia (Holdings) Pty Limited)
and FAI Deposit Co Pty Limited (now named First Mentor Group Pty Limited) as
original unit holders.
<PAGE> 124
"Turnover" means the aggregate of all sums of money or other consideration
received or receivable for all services sold or performed and all goods (if any)
sold, leased, hired or otherwise disposed of and from all businesses of any
nature whatever conducted at, in, from, on or upon each Facility by the Lessee.
In calculating such sums no deduction shall be made for bad or doubtful debts
but shall not include any GST, purchase tax and any similar sales or excise tax
imposed directly on the Lessee in respect of the supply of goods or services but
only to the extent that such tax is actually paid or accounted for by the Lessee
to the taxing authority.
"Turnover Period" means the period of 12 months expiring on the last day of the
calendar month immediately preceding the date of expiration of each Lease Year
except for the period from the date of this Lease to 30 June 2000 in which case
the Turnover Period shall be the period commencing on the date of this Lease and
expiring on 30 June 2000.
"Unavoidable Delays" means delays due to strikes, lock-outs, inability to
procure materials, power failure, acts of God, governmental restrictions, enemy
action, civil commotion, fire, unavoidable casualty or other causes beyond the
control of the party responsible for performing an obligation hereunder,
provided that lack of funds shall not be a cause beyond the control of either
party to this Lease.
"Unsuitable for Its Primary Intended Use" means a state or condition of a
Facility such that by reason of damage or destruction, or a Seizure Matter, that
Facility cannot (in the reasonable opinion of the Lessor) be operated for its
Primary Intended Use, taking into account, among other relevant factors, the
number of useable Beds, the amount of square footage and the estimated revenue
affected by such damage or destruction.
<PAGE> 125
SCHEDULE 2: LEASED PROPERTY
LEASED PROPERTY
All the land and buildings comprised within the following Certificates of Title:
<TABLE>
<CAPTION>
NSW, WA, Qld
<S> <C>
1. Annandale
Auto-consol 9867-46
2. Applecross
Vol. 1964 Fol. 640
3. Armadale (Hillview)
Vol. 1951 Fol. 293
4. Armon
1/110079
5. Bathurst
11/806355
6. Bossley Park
8/713734
7. Bunbury
Vol. 1534 Folio 995
8. Caloundra
2/177466
9. Canterbury
1/549851
10. Crest
1/913044 and 1/913045
11. Dubbo
12/592842
12. Fernleigh
1/201757 and 4/201757
13. Geraldton
Vol. 1539 Folio 329, Vol 1890 Folio 506
14. Kalgoorlie
Vol 1597 Folio 789
15. Maitland
5/733509
</TABLE>
<PAGE> 126
<TABLE>
<S> <C>
16. Mudgee
1/261314
17. Murray River
Vol 1697 Folio 190
18. Murwillumbah
1/786 640
19. Nambour
2/183823
20. Narranderra
2/582847 and 308/257212
21. Narrogin
Vol 1634 Folio 809
22. Norah Head
721/26247 and 509/26247
23. Quakers Hill
10/860042
24. Shoalhaven
5/614886
25. Stanmore
31/7/1
</TABLE>
<PAGE> 127
PROPORTION OF RENT AND INITIAL AGREED AMOUNT APPLICABLE TO EACH LEASED PROPERTY
<TABLE>
<CAPTION>
NSW, Qld & WA
-------------------------------------------------
LEASED PROPERTY AGREED AMOUNT RENT
-------------------------------------------------
<S> <C> <C>
Annandale 3,600,000 345,600
-------------------------------------------------
Applecross 1,650,000 158,400
-------------------------------------------------
Armadale 2,850,000 273,600
-------------------------------------------------
Armon 2,050,000 196,800
-------------------------------------------------
Bathurst 3,700,000 355,200
-------------------------------------------------
Bossley Park 4,550,000 436,800
-------------------------------------------------
Bunbury 2,000,000 192,000
-------------------------------------------------
Caloundra 3,300,000 316,800
-------------------------------------------------
Canterbury 3,200,000 307,200
-------------------------------------------------
Crest 2,000,000 192,000
-------------------------------------------------
Dubbo 3,600,000 345,600
-------------------------------------------------
Fernleigh 2,850,000 273,600
-------------------------------------------------
Geraldton 1,150,000 110,400
-------------------------------------------------
Kalgoorlie 1,700,000 163,200
-------------------------------------------------
Maitland 3,600,000 345,600
-------------------------------------------------
Mudgee 2,000,000 192,000
-------------------------------------------------
Murray River 1,500,000 144,000
-------------------------------------------------
Murwillumbah 5,100,000 489,600
-------------------------------------------------
Nambour 3,100,000 297,600
-------------------------------------------------
Narranderra 3,400,000 326,400
-------------------------------------------------
Narrogin 1,100,000 105,600
-------------------------------------------------
Norah Head 3,750,000 360,000
-------------------------------------------------
Quakers Hill 4,750,000 456,000
-------------------------------------------------
Shoalhaven 3,300,000 316,800
-------------------------------------------------
Stanmore 2,700,000 259,200
-------------------------------------------------
</TABLE>
<PAGE> 128
SCHEDULE 3: OTHER PROPERTIES
<TABLE>
<S> <C>
Vic
1. Altona
Vol 8741 Folio 761, 771
2. Meadow Heights
Vol 10342 Folio 086
3. Mildura
Vol 9892 Folio 717, 719, 720
4. Warrnambool
Vol 10346 Folio 571
5. Whittlesea
Vol 10390 Folio 104
</TABLE>
<PAGE> 129
SCHEDULE 4: ESTOPPEL CERTIFICATE
## ("Lessee") under the Lease ("Lease") dated ##, 199 ## and made with ##
("Lessor"), hereby certifies that:
1. It is the Lessee under this Lease; that attached hereto as
Annexure "A" is a true and correct copy of this Lease; that said Lease is
now in full force and effect and has not been amended, modified or
assigned except as disclosed or included in Annexure "A"; and that said
Lease constitutes the entire agreement between the Lessor and the Lessee.
2. Except as disclosed or included in Annexure "A":-
o there exist no defences or set offs to enforcement of this Lease;
o to the best of the Lessee's knowledge there are, as of the date
hereof, no breaches or unremedied defaults on the part of the
Lessee or the Lessor thereunder; and
o the Lessee has not received written notice of any prior
assignment, hypothecation, subletting or other transfer of the
Lessor's interest in this Lease.
3. The Rent for the current Lease Year under this Lease is $_______.
All Rent which is due has been paid, and there are no unpaid Additional
Charges owing by the Lessee under this Lease as of the date hereof. No
Rent or other items (including without limitation security deposit and
any impound account or funds) have been paid by the Lessee in advance
under this Lease except for the security deposit held by the Lessor a
charge on a rent deposit account in the amount of $ and the monthly
instalment of Rent that became due on [ ].
4. The Lessee has no current claim against the Lessor for the return
of any security deposit or prepaid Rent except as provided in paragraph 3
of this Certificate.
5. The Lessee has not, and to the best of the Lessee's knowledge the
Lessor has not begun any action, or given or received any notice for the
purpose of termination of this Lease.
6. This Estoppel Certificate has been requested by the Lessor under
Part 20 clause 20.1 of this Lease and for the benefit of __________
("Relying Party"). The Relying Party is entitled to rely on the
statements of the Lessee contained in this certificate.
7. All capitalised terms under herein and not defined herein shall
have the meanings for such terms set forth in the Lease.
Dated: the Lessee:
---------------------
By:
<PAGE> 130
SCHEDULE 5: THE OPTION NOTICE
Definitions
"Property" means ##.
"Intending Vendor" means ##.
"Intending Purchaser" means ##.
"Option Agreement" means an Agreement contained in Section 18 of a Lease dated
## 1998 between ## and ## relating to the Leased Property.
The Option contained in the Option Agreement is hereby exercised and the Leased
Property shall be purchased by the Intending Purchaser on the terms set out in
the Option Agreement.
Signed by the Intending Purchaser
------------------------------
<PAGE> 131
SCHEDULE 6: CONDITIONS OF SALE
1. DEFINITIONS & INTERPRETATION
1.1 Definitions
Unless the context otherwise requires, the following expressions shall
have the following meanings:-
"Actual Completion" means actual completion of the sale and purchase
under the Option and "Date of Actual Completion" shall be construed
accordingly;
"Arrears" means Rent, and other moneys recoverable by the Lessor from the
Lessee under the Lease but unpaid at Actual Completion and whether or not
demanded;
"Business Day" has the meaning given to it in the Standard Conditions.
"Completion Date" means the due date for completion ascertained in
accordance with clause 14.2, 14.3 or 16.4 as appropriate and will be the
date upon which the Option is effective;
"Head Lease" means any lease or underlease under which the Lessor holds
any part of the Leased Property and includes all licences, deeds and
other documents supplemental thereto so far as subsisting on Actual
Completion;
"Lessor's Consent" means the requisite consent in writing or (if so
required by the Lessor) by deed of the Lessor to the assurance of the
Head Lease to the Lessee or a permitted assignee or a final declaration
of the Court to the effect that such consent has been unreasonably
withheld;
"Lessor" means the Person or company in whom the reversion expectant upon
the term granted by the Head Lease is vested at the relevant time and
includes any superior Lessor;
"Lease" means the Lease and any Supplemental Lease and any other deed
expressed to be supplemental thereto and includes any Schedules thereto;
"Standard Conditions" means the edition of the Law Society of New South
Wales and Real Estate Institute of New South Wales Contract for the Sale
Of Land which is current at the date of exercise of the Option;
"Option" means any option or election made by the Lessee under or in
accordance with Part 18 of the Lease;
<PAGE> 132
"Price" means the Repurchase Price;
"Property" means all that the Lessor's reversionary interest in the
Leased Property (excluding any Affected Property which has ceased to be
Leased Property under clause 14.7 before notice to exercise the Option
was given under clause 18.3).
1.2 Interpretation
(a) Words and expressions defined in or to be interpreted in
accordance with any provisions of the Lease shall (save where a
different definition or interpretation is given in this Schedule
in which case such different definition or interpretation will
prevail) bear the same meaning or (as the case may require) be
interpreted in the same way in this Schedule.
(b) Unless the context otherwise requires, words or expressions
importing the singular number shall be deemed to include the
plural and vice versa, words importing the neuter gender shall be
deemed to include the masculine and feminine genders and words
importing the masculine gender only shall be deemed to include the
feminine and vice versa.
(c) Unless otherwise stated, a reference to a paragraph is a reference
to a paragraph in this Schedule and a reference to a subparagraph
is a reference to a subparagraph in the paragraph in or to which
reference is made, and a reference to a Part or clause is a
reference to a Part or clause in the Lease.
(d) References to any Act of Parliament include references to any
statutory modification or re-enactment thereof for the time being
in force and any order, instrument, regulation or by-law made or
issued thereunder.
(e) The headings herein contained shall not be taken into account in
the construction or interpretation of this Agreement.
2. MATTERS AFFECTING THE PROPERTY: TITLE
(a) The Property is sold subject to and with the benefit of the Lease
so far as subsisting on Actual Completion.
(b) The Property is also sold subject to:-
(i) all matters in the nature of easements, rights, exceptions,
reservations, restrictions, covenants, conditions and
agreements;
(ii) the entries on the Certificate of Title for the Property by
the Registrar General other than any Encumbrances securing
indebtedness of the Lessor or any Associated Company of the
Lessor.
<PAGE> 133
(iii) any Encumbrances (not securing indebtedness of the Lessor
or any Associated Company of the Lessor) consented to by
the Lessee (such consent being in writing and signed as a
deed) before or during the Term;
(iv) any permitted Encumbrances; and
(v) any other Encumbrances created before or during the Term in
the operation of the law that do not relate to indebtedness
of the Lessor or any Associated Company of the Lessor
(vi) (If any part of the Property is leasehold) the rents
reserved by and the covenants and conditions on the part of
the Lessee to be observed and performed contained in the
lease thereof or in any deed or document supplemental
thereto (in each case) so far as the same are subsisting
and capable of taking effect at Actual Completion.
(c) The Lessee will be deemed to purchase with full knowledge of all
matters subject to which the Property is sold thereof and (subject
to the provisions of clause 2(g)) will not raise any enquiry,
requisition or objection in relation thereto.
(d) The Lessee and any permitted assignee to whom the Property is
assured will in the assurance of the Property:-
(i) jointly and severally covenant by way of indemnity only
with the Lessor that the covenantee and its successors in
title will thenceforth perform and observe:-
(A) the obligations of the Lessor under and the
conditions contained in the Lease; and
(B) the other obligations of the owner of the Property
or otherwise binding on the Lessor arising under the
documents and matters subject to which the Property
is sold (so far as the same affect the Property (or
any part or parts thereof) and are still subsisting
and capable of being enforced); and
(ii) covenant with the Lessor fully and effectually to indemnify
the Lessor in respect of all such obligations and
conditions referred to in this clause 2(d) and against all
actions, claims, costs, demands, expenses, liabilities and
losses arising in consequence of any breach thereof.
<PAGE> 134
(e) The Lessee shall be deemed to have full notice of both the present
user and permitted uses of the Property and shall not be entitled
to request any information or to raise any objection or
requisition with regard thereto.
(f) The description of the Property is believed and shall be deemed to
be correct and no objection or requisition shall be made on
account of any error or omission in description.
(g) Title to the Property having been deduced to the Lessee before the
date hereof, the Lessee shall accept the same and shall raise no
enquiry, requisition or objection thereto save in respect of
matters arising after the assurance of the Property to the Lessor.
3. STANDARD CONDITIONS OF SALE
3.1 The sale of the Property is subject to the Standard Conditions (as hereby
varied) so far as the same are not inconsistent with the terms hereof and
subject to the following:
(a) the prescribed rate of interest is 4% per annum above Westpac
Indicator Lending Rate from time to time;
(b) "price" shall include the Price and any sum to be paid for
chattels, fittings or other separate items;
(c) the Property is sold subject to such of the following matters:
(i) all rates, water, sewerage and drainage service and usage
charges, land tax and all other periodic outgoings;
(ii) all notices served and orders, demands, proposals or
requirements made by any local or other public authority
(whether before, on, or after the date of this Agreement);
(iii) all actual or proposed charges, notices, orders,
restrictions, agreements, conditions or other matters
arising under any planning legislation.
3.2 The Lessor shall be deemed to be ready and willing to fulfil its own
outstanding obligations under this Agreement:-
(a) If it could do so but for the default of the Lessee; and
(b) Even though a mortgage or charge remains secured on the Property.
3.3 Any amount payable by the Lessee under the Option shall be paid free of
all deductions, withholdings or set-offs whatsoever.
<PAGE> 135
3.4 For the avoidance of doubt any sum (including any purchase money)
or other consideration payable under or by virtue of the Option
shall to the extent that GST is chargeable thereon be (and be
deemed to be) exclusive of GST which tax shall be payable by the
party obliged to pay such sum or other consideration and which
shall be payable on the due date for payment of such sum or
consideration (as the case may be).
3.5 If any part of the Property is leasehold the obligations of the
Lessor and the Lessee for the assurance of that part under the
Option are conditional on the obtaining of the Lessor's Consent.
3.6 The Lessor shall as soon as practicable after exercise of the
Option apply for and use its reasonable endeavours to obtain the
Lessor's Consent duly signed or executed (as the case may require)
but such obligation shall not extend to the execution of any works
of repair or redecoration and shall not unless reasonably required
by the Lessee and without cost to the Lessor (the Lessee paying
the Lessors proper and reasonable costs) include taking court
proceedings.
3.7 The Lessee shall promptly:-
(a) supply all such references and information as the Lessor
may reasonably require, including in relation to any
proposed surety, in order to consider the Lessor's
application for the Lessor's Consent;
(b) comply with the Lessor's and their respective Solicitors'
reasonable requirements in relation to the granting of the
Lessor's Consent; and
(c) execute and procure any permitted assignee to execute a
counterpart of the Lessor's Consent incorporating if so
required by the Lessor:-
(i) a covenant by the Lessee and any permitted assignee
to pay the rents reserved by the Lease and to
observe and perform the Lessee's covenants and the
conditions contained in the Lease; and
(ii) such other covenants by the Lessee and any permitted
assignee as the Lessor may reasonably require and
which may include covenants by the Purchaser and
permitted assignee as to the execution of works of
repair and redecoration where in the opinion of the
Lessor required to remedy any breach of any of the
Lessee's covenants or the conditions contained in
the Lease; and
(iii) if so required by the Lessor procure that a surety
or sureties acceptable to the Lessor sign or execute
such counterpart to enter into such covenants as may
be reasonably required by the Lessor within 5
business days after the engrossment thereof has been
submitted to the Lessee's Solicitors.
<PAGE> 136
3.8 As soon as reasonably practicable after the obtaining of the Lessor's
Consent the Lessor shall procure that the Lessee is given notice to the
effect that the conditions set out in clause 3 have been satisfied.
4. NON-ASSIGNMENT
4.1 The Lessee shall not assign except contemporaneously with a lawful
assignment of the Lease and to the same assignee ("permitted assignee")
in whole or part the benefit of the Option which is personal to the
Lessee.
4.2 The Lessor shall not be required to execute an assurance of the whole or
any part of the Property to any Person other than the Lessee named herein
or a permitted assignee nor to grant any overriding lease of the whole or
any part of the Property and the Property shall be assured to the Lessee
or a permitted assignee as a whole by one assurance only.
5. COMPLETION
5.1 Completion of the sale and purchase hereby agreed shall take place on the
Completion Date at the Lessor's solicitors' office or at such other place
as the Lessor may reasonably require, when the whole of the Price
together with the other purchase money shall be due and payable.
5.2 For the purpose of ascertaining the day of Actual Completion under this
Agreement only every day shall be deemed to end at 2.00 p.m. so that if,
due to the default of the Lessee, Actual Completion is effected after
2.00 p.m. on any day it shall be deemed to have been effected on the next
following business day and (inter alia) interest shall accrue
accordingly.
5.3 The Lessor shall not be obliged to complete the sale of the reversion to
the Lease in part only nor complete the sale otherwise than
contemporaneously with completion of the sales under the corresponding
provisions of each Supplemental Lease.
6. CANCELLATION OF REGISTRATIONS
6.1 Upon any rescission or determination of any agreement arising on exercise
of the Option, howsoever arising, the Lessee shall forthwith, and in any
event within 5 business days (in respect of which time shall be of the
essence) of such rescission or determination, apply for and procure the
cancellation of all caveats and other entries and registrations effected
(or for which an application shall have been made) to protect such
agreement and the interests of the Lessee as purchaser of the Property.
The Lessee shall provide certified true copies of all such applications
for cancellation to the Lessor.
<PAGE> 137
6.2 The Lessee hereby irrevocably appoints the Lessor as its attorney to act
in its name and on its behalf for the purpose of effecting or procuring
such cancellations at the cost of the Lessee in the event that the Lessee
shall fail to fulfil its obligations under clause 6.1.
6.3 This paragraph shall remain in effect notwithstanding any rescission or
determination of any agreement as aforesaid or of the Lease.
7. MERGER
The provisions of this Schedule shall remain in full force and effect in
so far as they remain to be observed and performed notwithstanding Actual
Completion.
8. ENTIRE AGREEMENT: LIMITATIONS AS TO WARRANTIES
8.1 The Lessor and the Lessee respectively acknowledge that this Schedule and
the Lease constitute and form the entire contract between them relating
to its subject matter and that if it shall exercise the Option the Lessee
will not exercise the same in reliance on any representation, warranty or
statement (whether oral, written or implied) made by or on behalf of the
Lessor. This clause shall remain in effect notwithstanding Actual
Completion.
8.2 No modification, variation or waiver of any of the provisions of this
Schedule shall, except as otherwise expressly provided, be effective
unless the same is in writing and signed by the party against which
enforcement of such modification, variation or waiver is sought.
8.3 Any failure of either party hereto at any time to require performance by
the other of any provision of this Agreement shall not affect the right
of such party to require performance of that provision.
9. NOTICES
ALL notices given by either party to the other under the Option shall be
served or mailed in accordance with Section 31.
<PAGE> 138
SCHEDULE 7: OPTION TO PURCHASE RELEVANT ASSETS
1. DEFINITIONS
In this Schedule, unless the context otherwise requires, the following
expressions shall have the following meanings:-
"Accrued Leave Entitlements" means the accrued rights of each Employee
whose employment is transferred to the Lessee under clause 4.7 to sick
leave, long service leave and holiday pay as at Option Completion.
"Business" means the nursing and/or residential care home businesses
carried on by the Lessee at each of the Leased Properties;
"Business Day" means a day (other than a Saturday or a Sunday) on which
banks generally are open for business in Sydney;
"Consumable" means food, fuel, linen, cleaning supplies and materials,
medical and nursing supplies, medical record supplies, office supplies
and other consumable stores;
"Employees" means the employees engaged by Lessee on Option Completion in
connection with the Business;
"Encumbrance" includes any interest or equity of any Person (including,
without prejudice to the generality of the foregoing, any right to
acquire, option or right of pre-emption) or any mortgage, charge, pledge,
lien, assignment, hypothecations, security interest (including any
created by law), title retention or any other security agreement or
arrangement or a rental, hire purchase, credit sale or other agreement
for payment on deferred terms;
"Future Hire Contracts" means those contracts and other contractual
arrangements which shall or may be entered into by the Lessee or its
predecessors in title on or after the date of completion under which
tangible assets shall be supplied to the Lessee for use in or in
connection with the Business by way of replacement for any Hired Assets
or any other Future Hired Assets on hire or other rental, lease, licence,
hire purchase or on other terms such that title does not pass to the
Lessee (provided that the foregoing shall not include or relate to any
tangible assets which would be owned by the Lessee were it not only for
any retention of title or like clause in any original purchase contract);
"Future Hired Assets" means tangible assets the subject of Future Hire
Contracts;
"Hire Contracts" means those contracts and other contractual arrangements
entered into by or on behalf of the Lessee or its predecessors in title
before the date of the completion under which tangible assets used in or
in connection with the Business at that date other than the Sale Assets
have been supplied to or are now held by the Lessee on hire or other
rental, lease, licence, hire purchase or on other terms such that title
thereto does not pass or has not at completion passed to the Lessee
(provided that
<PAGE> 139
the foregoing shall not include or relate to any tangible assets which
would have been owned by the Lessee were it not only for any retention of
title or like clause in any original purchase contract);
"Hired Assets" means tangible assets the subject of Hire Contracts;
"Lease" means this Lease;
"the Lessee's Personal Property" has the meaning ascribed to it in the
Lease;
"Lessor", except in clause 2.1, includes its nominee where the context
permits.
"the Lessor's Personal Property" has the meaning ascribed to it in the
Lease;
"the Lessor's Solicitors" means the solicitors to the Lessor being at
present Phillips Fox of 255 Elizabeth Street, Sydney;
"Option" means the Option granted under paragraph 2.1 of this Schedule;
"Option Completion" means completion of the sale and purchase of the
Relevant Assets under the Option;
"Option Price" means the option price specified in paragraph 3.1;
"Properties" means the properties described in the Lease;
"Relevant Assets" has the meaning ascribed to it in paragraph 2.2 of this
Schedule;
"Sale Assets" means the Properties and the Lessee's Personal Property;
"Third Party" has the meaning ascribed to it in paragraph 4.10(1);
2. GRANT OF OPTION
2.1 Grant of Option
In consideration of the payment by the Lessor to the Lessee of the sum of
$1 (receipt of which is hereby acknowledged) the Lessee irrevocably and
unconditionally grants to the Lessor or its nominee the right,
exercisable as provided in paragraph 2.3, to purchase such of the
Relevant Assets specified by the Lessor, for the Option Price specified
in paragraph 3.
<PAGE> 140
2.2 Subjects of Option
(a) In this Schedule, the "Relevant Assets" comprise
(i) all the assets (including goodwill and book debts) which
shall as at the date on which notice is given to exercise
the Option be owned and solely used by the Lessee in
connection with the Business at the Properties or any of
them that were subject to the Lease immediately before its
termination, excluding only (i) any rights of the Lessee
against third parties not arising out of or in connection
with the Relevant Assets so far as acquired by the Lessor
under the Option; (ii) any intellectual property documents,
manuals, reports and other information developed by the
Lessee in connection with its operations in Australia
including (without limitation) patient satisfaction
surveys, employee handbooks, corporate financial statements
and quality assurance policies and procedures; (iii) all
accounting, financial and taxation records which relate to
the Business (in whatever form) which are required by
statute or other legal requirements to be retained; (iv)
all cash in hand or at the bank; and (v) for the avoidance
of doubt, the Lessee's Personal Property (but excluding the
Residents' Personal Property);
(ii) all the Hired Assets and Future Hired Assets; and
(iii) Consumables
2.3 Exercise of Option
The Lessor may exercise the Option in relation to all the Relevant Assets
or all the Relevant Assets except the benefit of any contract(s)
specified by the Lessor by notice in writing given to the Lessee either
before or within the period which is the later of (i) 30 days after the
termination (for whatever reason and howsoever effected) of the Lease and
(ii) 30 days after the last to occur of the delivery of the list,
statement of values and information and the provision of the answers to
the Lessors enquiries, all as referred to in paragraph 2.4, but the
Option shall expire (and any exercise of the Option shall be void) if the
Lessee shall complete the purchase of the Properties encompassed within
the Lease immediately before its termination. If the Lessee shall
complete the purchase of less than all the Properties, the Option shall
expire (and to such extent only any exercise of the Option shall be void)
with respect to those of the Relevant Assets owned and used in the
Business to the extent that it is operated at those Properties which
immediately before the expiration of the Lease were subject to it (and to
such extent only any exercise of the Option shall be void). The Lessee
undertakes to the Lessor that it will not, after the exercise of the
Option and pending Option Completion, remove any of the Relevant Assets
from the Properties.
2.4 Particulars of Relevant Assets
At least 30 days before the termination of the Lease or (if termination
shall be due to forfeiture) forthwith after termination, the Lessee shall
deliver to the Lessor a true and complete list of all Relevant Assets
including a statement of the full face value of all its
<PAGE> 141
book debts and the depreciated book value of all other Relevant Assets
(other than goodwill, the Hired Assets and the Future Hired Assets),
together with such other information concerning the Relevant Assets and
the Business as the Lessor shall require. The Lessee shall promptly
respond to any enquiries which the Lessor shall raise in relation to such
list, statement of values or information. The Lessor shall be entitled to
treat any asset not so listed which would otherwise be included in the
Relevant Assets as not one of the Relevant Assets.
3. OPTION PRICE
3.1 Amount
The Option Price shall be the sum of $1 for goodwill, nil for the Hired
Assets and the Future Hired Assets, the face value of the book debts, the
cost price of the Consumables and the depreciated book value of the other
Relevant Assets, and in every case shall be inclusive of GST, if any.
3.2 Disputes
Any disputes, differences or questions arising from the provisions of
this paragraph shall at the request of either the Lessor or the Lessee be
referred to an independent chartered accountant agreed upon by both of
them or (in default of agreement) nominated (at the request of either of
them) by the President for the time being of the Institute of Chartered
Accountants in Australia, which independent chartered accountant shall
act as an expert and not as an arbitrator and his fees and expenses in so
acting shall be borne between the Lessee and the Lessor as he directs.
Each of the parties hereto agrees to be bound by the decision of such
independent chartered accountant which shall be final and binding
accordingly (save in respect of manifest error).
4. OPTION COMPLETION
4.1 Date and place of Option Completion
Subject to exercise of the Option the Lessee and the Lessor shall be
bound to complete the sale and purchase of the Relevant Assets on the
later of (a) service of the notice of exercise and (b) the termination
(for whatever reason and howsoever effected) of this Lease (other than
and to the extent of termination upon completion of a purchase of the
Leased Property by the Lessee under the Default Option or the Option (or
in either case on the next succeeding Business Day if Option Completion
would otherwise fall on a non-Business Day). Option Completion shall take
place at the offices of the Lessor's Solicitors or at such other place as
the parties shall agree.
<PAGE> 142
4.2 Option Completion obligations
4.2.1 Upon Option Completion:-
(a) the Lessee shall deliver or cause to be delivered to the Lessor:-
(i) all those Relevant Assets capable of passing by delivery,
including any assets leased by the Lessee, together with
all documents of title relating thereto;
(ii) an assignment of goodwill in such form as the Lessor shall
reasonably require; and
(iii) assignments of the Lessee's books debts (if purchased),
contracts (including contracts, to the extent lawfully
assignable, with or for the care of patients) to the extent
that the Lessor is purchasing them, and intellectual
property rights, in such respective forms as the Lessor
shall reasonably require;
(iv) the Lessor may agree that the assignments referred to at
(b) and (c) above shall be delivered within a period,
specified by the Lessor, after Option Completion.
4.2.2 The Lessor shall pay the Option Price to the Lessee in cash: provided
that the Lessor shall not be obliged to pay at Option Completion that
part of the Option Price which relates to book debts which have at the
date of Option Completion been outstanding for 60 days or more (the
Option Price for such book debts being paid only if, when and to the
extent that the same are paid).
4.2.3 If any book debt is not paid in full within 3 months of Option Completion
then in respect of each outstanding book debt the Lessee must take an
assignment of the book debt at its own cost against payment by the Lessee
to the Lessor of an amount equal to the amount of the book debt.
4.3 Covenants by the Lessee
The Lessee covenants with the Lessor that:-
(i) it has full power and authority to grant the Option in respect of
the Relevant Assets upon the terms and conditions of this
Schedule; and
(ii) at Option Completion the Relevant Assets (including the Hired
Assets and the Future Hired Assets) will be sold to the Lessor as
beneficial owner and free of any Encumbrances (and the Lessee
shall accordingly procure unencumbered title to the Hired Assets
and the Future Hired Assets to enable it to fulfil this covenant
with respect to the Hired Assets and the Future Hired Assets).
<PAGE> 143
4.4 Pending third party consents
The Lessee shall use all reasonable endeavours without payment of a
premium to obtain all such consents as may be necessary for the transfer
to the Lessor with effect from Option Completion of all the Relevant
Assets and the Lessee declares itself with effect from Option Completion
trustee for the Lessor in respect of all such property and assets until
the same shall with any necessary consents from third parties have been
finally assigned to the Lessor and the Lessee undertakes that until
completion of such assignments it will with effect from Option Completion
act under the direction of the Lessor and as its agent in all matters
relating to such property and assets and shall (with effect as aforesaid)
be and be entitled to be full and effectively indemnified by the Lessor
in so acting accordingly.
4.5 Treatment of Contracts
In respect of any contracts comprised in the Relevant Assets and not
excluded therefrom by the Lessor ("such contracts"):-
(a) the Lessee shall on or with effect from Option Completion assign
or hold to the order of the Lessor or procure the assignment to
the order of the Lessor of all such contracts which are capable of
assignment without the consent of other parties;
(b) in the case of those of such contracts not so capable of
assignment the Lessee shall, as soon as practicable following
Option Completion, use all reasonable endeavours to obtain all
necessary consents without payment of a premium for the assignment
of the same or to arrange the novation thereof; and
(c) unless and until such consents are obtained or novation is
effected the Lessee shall, at the option of the Lessor, following
Option Completion either:-
(i) unless contractually prevented from so doing, subcontract
the same to the Lessor on the same terms (mutatis mutandis)
and for the same remuneration as apply to such contracts in
question; or
(ii) act in connection therewith in all respects as the Lessor
may from time to time reasonably direct, and so that
(without prejudice to the generality of the foregoing) the
Lessor shall perform the obligations and liabilities
arising under such contracts in question so far as any such
obligation or liability arises after Option Completion
(provided that no such obligation or liability is
attributable to a breach of duty or contract of the Lessee
before Option Completion) and the full benefit of all
contractual rights, benefits and claims under this Lease
whether arising
<PAGE> 144
before or after Option Completion shall vest in and be held
on trust by the Lessee for the Lessor absolutely. Provided
that the Lessee shall in all matters be and be entitled to
be fully and effectively indemnified as the Lessor in so
acting in accordance with the Lessor's directions.
4.6 Covenant by the Lessor
The Lessor covenants with the Lessee that upon Option Completion the
Lessor will, to the extent the other parties thereto agree, perform and
observe all contracts comprised in the Relevant Assets and not excluded
therefrom by the Lessor and the Lessor will indemnify the Lessee against
loss suffered by the Lessee arising from any breach or non-performance by
the Lessor occurring on or after the date of Option Completion or any
claim in respect of such matters.
4.7 Employees
(a) The Lessor may offer in writing to employ all of the Employees
with effect from Option Completion, on the terms and conditions
that the Lessor considers appropriate.
(b) The Lessee must release the Employees who accept the offer of
employment with the Lessor ("Transferring Employees") from their
employment with the Lessee with effect from Option Completion.
(c) The Lessee must pay all amounts then due to each of the
Transferring Employees in respect of remuneration up to Option
Completion other than Accrued Leave Entitlements.
(d) From Option Completion the Lessor must assume the Lessee's
obligations to pay the Transferring Employees their Accrued Leave
Entitlements.
(e) On Option Completion the Lessee must pay to the Lessor or allow
the Lessor to set off against the Option Price an amount equal to
the monetary value of the Accrued Leave Entitlements as at Option
Completion.
(f) The Lessee covenants with the Lessor that the Lessee will
indemnify the Lessor and hold the Lessor harmless against all
costs claims expenses and liabilities whatsoever arising in
connection with any claim made by or on behalf of any Employee
(including, without limitation, any claim for a redundancy
payment, damages for breach of contract or compensation for unfair
dismissal) insofar as and to the extent that the cause of action
giving rise to such claim arises (wholly or in part) during that
person's (or his/her relative's) period of employment by the
Lessee or any subsidiary of the Lessee or any other Person for the
time being carrying on the Business before such transfer (provided
that the indemnity contained in this paragraph 4.7 shall not
extend to claims to the extent of claims arising during or in
respect of any period of employment by the Lessor); and against
all legal costs and expenses reasonably incurred by the Lessor in
settling contesting or dealing with any such claim.
<PAGE> 145
4.8
(a) The Lessee covenants with the Lessor that it shall not make
contributions to any retirement benefits scheme which could have
any unfunded liabilities.
(b) In the event that any Transferring Employee brings a claim against
the Lessee or the Lessor arising out of or in connection with the
transfer his or her employment to the Lessor, the Lessor and the
Lessee shall at their own respective expense give to the other as
soon as practicable after any request therefor all co-operation,
assistance and information which may be reasonably relevant to the
claim.
(c) The Lessee hereby agrees to assign to or otherwise hold for the
Lessor with effect from Option Completion the benefit of any
confidentiality or other undertakings or restrictions given to the
Lessee by any present or former employees of the Lessee in the
Business where such undertakings or restrictions or the benefit
thereof are not novated to or otherwise vested in the Lessor by
virtue of the Regulations and accordingly the Lessee hereby agrees
pending formal assignment or novation of the same and at the
request of the Lessor to take such steps, actions and proceedings
as the Lessor shall reasonably require to enforce such
undertakings and restrictions (or any of them) for the benefit and
at the cost of the Lessor.
4.9 Indemnity
The Lessee acknowledges and agrees with effect on and from Option
Completion that the Lessor shall not assume or have any liability or
obligation in respect of the Business and agrees to indemnify the Lessor
and holds it harmless against any such obligation or liability.
4.10 Assignment
The Lessor may assign its rights under the Option to any Person to whom
it shall lawfully transfer the reversion of the Lease.
4.11 Sale of the Lessee's interest in the Business
(a) In this paragraph 4.11 "Third Party" means any Person or persons
who whether by purchase or some other event shall before the
expiry of the later
<PAGE> 146
period referred to in paragraph 2.3 (the "Expiry Date") become
entitled to the interest of the Lessee in the Business or any such
part of the Business as is referred to in paragraph 4.11(b).
(b) The Lessee covenants with the Lessor that it shall not, until
after the Expiry Date, sell or otherwise dispose of all or any
part of the Business, except that this covenant shall not prevent
the Lessee -
(i) from selling or realising current assets in the ordinary
course of the Business; or
(ii) from selling with the prior written consents of the Lessor
the whole of its interest in the undertaking, assets and
goodwill of the Business or the whole of its interest in
that part of any Business as shall be carried on at any
individual Property or Properties, but subject in the cases
referred to in this paragraph (b) to the Lessee complying
with paragraph 4.11(c).
(c) If the Lessee shall sell its interest in the Business or any part
of the Business as permitted by paragraph 4.11(b), or the same
shall as a consequence of some other event become vested in a
Third Party, the Lessee shall procure that the option shall
continue to be enforceable by the Lessor against the Third Party
and shall take all necessary steps as shall be required by the
Lessor to ensure that upon the subsequent exercise of the Option
the Business (or such part, as the case may be) shall be sold to
the Lessor by the Third Party and so that the covenant in
paragraph 4.11(b) and the other provisions of this paragraph 4.11
shall apply and that the Option shall be binding on and capable of
enforcement against all owners of the Business (or any such part
thereof, as the case may be) down to and including the Expiry Date
and it is agreed that the Lessee -
(i) shall give not less than 30 Business Days' notice to the
Lessor of the Lessee's intention to sell its interest in
the Business (or any such part thereof, as the case may be)
to the Third Party; and
(ii) shall procure that the Third Party shall immediately upon
completing any such sale and before the grant of any other
interest in the Business (or any such part thereof, as the
case may be) execute and deliver to the Lessor a deed of
covenant in the form set out in Schedule 9 to this Schedule
with such modifications as the Lessor shall in its absolute
discretion require.
4.12 The Lessor's remedies
Without prejudice to any other rights or remedies which the Lessor may
have, the Lessee acknowledges and agrees that damages would not be an
adequate remedy for any breach of the Lessee's obligations in connection
with the Option and the Lessor shall be entitled to the remedies of
injunction, specific performance and other equitable relief for any
threatened or actual breach of such obligations. Nothing herein contained
shall be
<PAGE> 147
construed as prohibiting the Lessor from pursuing any other remedies
available to it, either at law or in equity, for such breach of
threatened breach, including specific performance and recovery of
monetary damages.
4.13 Perpetuity Period
The perpetuity period applicable to the Option shall be eighty (80) years
from the date of this Lease.
<PAGE> 148
SCHEDULE 9
THIS DEED OF COVENANT is made the day of
BETWEEN
(1) [the Third Party] of [ ] (the "Vendor") and
(2) Principal Healthcare Finance Pty Limited care of Phillips Fox 255
Elizabeth Street, Sydney, New South Wales, Australia (the Lessor")
WHEREAS
A This Deed is entered into under the obligations contained in the Lease
(the "Lease") dated 1998 and made amongst the Lessor (1) and
o o (2) by which inter alia the Lessor is entitled to purchase the
Business (as there defined) upon and subject to the conditions there
contained.
B The Vendor has become the owner of the Business [relevant part of the
Business].
THIS DEED WITNESSES as follows -
The Vendor [jointly and severally] covenants with the Lessor in respect of the
Business that the Vendor will at all times after the date of this deed observe
and perform all of the covenants, conditions and obligations on the part of the
Lessee (as defined in the Lease) contained in the Lease in connection with the
Option and will do and perform all acts and things as shall be necessary or
appropriate to enable the Purchaser to exercise its right to purchase the
Relevant Assets (as defined in the Lease) in accordance with the terms and
conditions of the Lease.
This deed shall be governed by, and construed in accordance with the laws of New
South Wales.
IN WITNESS etc.
<PAGE> 149
EXECUTED AS A DEED
Signed, sealed and delivered by the attorney of
Principal Healthcare Finance Pty Limited under
power of attorney registered Book ____________
No ____________ in the presence of:
------------------------------------
Signature of attorney
- ------------------------------------ ------------------------------------
Signature of witness Office held
- ------------------------------------ ------------------------------------
Name of witness (print) Name of attorney (print)
Executed by Moran Health Care (Australia) Pty
Limited (as Lessee) without a common sealing
acting by:
- ------------------------------------ ------------------------------------
Signature of authorised person Signature of authorised person
- ------------------------------------ ------------------------------------
Office held Office held
- ------------------------------------ ------------------------------------
Name of authorised person (print) Name of authorised person (print)
<PAGE> 150
Executed by Moran Health Care Group Pty
Limited (as Guarantor) without a common seal
acting by:
- ------------------------------------ ------------------------------------
Signature of authorised person Signature of authorised person
- ------------------------------------ ------------------------------------
Office held Office held
- ------------------------------------ ------------------------------------
Name of authorised person (print) Name of authorised person (print)
<PAGE> 151
1
CAPITAL CONTRIBUTION AGREEMENT
(Moran Phase 2)
THIS AGREEMENT is made on 1998
PARTIES
MORAN HEALTH CARE (AUSTRALIA) PTY LIMITED ACN 082 466 457 of 13 - 15 Bridge
Street Sydney, New South Wales, Australia (Moran)
MORAN HEALTH CARE GROUP PTY LIMITED ACN 008 585 242 of 13 - 15 Bridge Street
Sydney, New South Wales, Australia (Covenantor)
PRINCIPAL HEALTHCARE FINANCE PTY LIMITED ACN 069 875 476 of Level 12, 255
Elizabeth Street, Sydney, New South Wales, Australia
BACKGROUND
A Moran has agreed to lease the assets described as "Leased Property" in
the Lease from PHF.
B The Covenantor has requested PHF to enter into this agreement.
C Moran has accepted certain capital expenditure obligations under the Lease.
D PHF has also agreed to make certain capital contributions in respect of
the properties subject to the Lease on the terms and conditions contained
in this agreement at the request of the Covenantor.
AGREEMENT
1. DEFINITIONS
In this agreement:
ASSET means "CGT assets" for the purposes of Division 108 of the
Income Tax Assessment Act 1998 that are owned by PHF.
ASSOCIATE has the same meaning as is attributed to that word
pursuant to section 318 of the Income Tax Assessment Act 1936.
CAPEX CONTRIBUTION DATE means 30 September in each Lease Year or 7
days after any controversy relating to the relevant Capex
Contribution Conditions has been determined pursuant to clause
2.13, whichever is the later.
<PAGE> 152
2
Contribution Limit means at any time the lesser of:
(a)$33,927,500; and
(b)95% of the aggregate valuation for the Leased
Properties referred to in Schedule 2 of the Lease
less the Agreed Amount as increased from time to
time.
INCREASED RENT means the amount derived pursuant to clause 2.9.
INITIAL VICTORIAN CAPEX CONTRIBUTION means $7,500,000.
LEASE means the lease of the Queensland Properties, NSW Properties
and WA Properties granted by PHF to Moran and, where the context
permits, includes the Victorian Lease.
MINIMUM CONTRIBUTION AND MINIMUM CAPEX means, in respect of a
Lease Year, the amount specified opposite the name of each
Facility in Schedule 5 in the column for the relevant Lease Year
or such other amount as is agreed from time to time by PHF and
Moran.
MORAN ACCOUNT means an account styled "Principal Healthcare
Finance Pty Limited - Moran Healthcare (Australia) Capex Account"
established and conducted by PHF.
NSW PROPERTIES means the properties identified as such in Schedule
1.
PHF means Principal Healthcare Finance Pty Limited or any other
trustee for the time being of the Trust.
PHF ACCOUNT means an account styled "Principal Healthcare Finance
Pty Limited - Moran Healthcare (Australia) Capex Security Account"
established and conducted by PHF.
PROPERTIES means any one or more of the Queensland Properties, NSW
Properties, Victorian Properties or WA Properties.
QUEENSLAND PROPERTIES means the properties identified as such in
Schedule 2.
TRUST means the trust known as the "Principal Healthcare Finance
Trust" (formerly known as the "Assisted Living Unit Trust")
constituted by a deed of trust dated 11 August 1995 between
Assisted Living (Holdings) Pty Limited (now named Principal
Healthcare Finance Pty Limited) as trustee and Metlife Australia
(Holdings) Pty Limited (now named Premier Care Australia
(Holdings) Pty Limited) and FAI Deposit Co Pty Limited (now named
First Mentor Group
<PAGE> 153
3
Pty Limited) as original unit holders.
VICTORIAN LEASE means, when granted, the lease from PHF to Moran
of the Victorian Properties, the terms of which have been agreed
between PHF and Moran.
VICTORIAN PURCHASE AGREEMENT means the agreement dated the same
date as this agreement pursuant to which PHF acquires the
Victorian Properties.
VICTORIAN PROPERTIES means the properties identified as such in
Schedule 3.
WA PROPERTIES means the properties identified as such in Schedule
4.
2. TRUSTEE'S ADDITIONAL CAPITAL CONTRIBUTION
2.1 TERMS DEFINED IN THE LEASE
2.1.1 Words which have a defined meaning in the Lease
have the same meaning when used in this clause 2
unless:
(a) the same word is also defined in this
agreement, in which case the definition in
this agreement prevails; or
(b) there is a conflict between the Lease and the
Victorian Lease, in which case the definition
in the Lease will prevail.
2.1.2 The references to the terms "Cash Flow", "Gross
Cash Flow" and "Rent" which have a defined
meaning in both the Lease and the Victorian Lease
are to be construed in this agreement as meaning
the aggregate of the relevant amounts as
determined in accordance with each of the Lease
and the Victorian Lease.
2.2 MORAN MAY SERVE REQUEST NOTICE
2.2.1 Subject to clause 2.2.3 in respect of the Lease
Years commencing on 1 July 1999, 2000, 2001, 2002
and 2003 Moran may serve written notice (REQUEST
NOTICE) on PHF as specified in clause 2.2.2 (the
date on which the Request Notice is served being
the REQUEST DATE) requesting PHF to pay a sum of
money into the PHF Account (Capex Contribution).
2.2.2 A Request Notice must not be given:
(a) more than once in any Lease Year; and
(b) earlier than the date that the requirements
of section
<PAGE> 154
4
24.1(c) of the Lease are satisfied or later than
4 weeks after the requirements of section 24.1(c)
of the Lease are satisfied.
2.2.3 PHF may disregard any Request Notice given before
the purchase price paid or payable by PHF to the
Covenantor directly or indirectly in connection
with the acquisition of the Victorian Properties
is $4,517,500.
2.3 PHF MAY MAKE CAPEX CONTRIBUTIONS
2.3.1 If Moran does not serve a Request Notice pursuant
to clause 2.2.1 in respect of any Lease Year
specified in clause 2.2.1 requesting the Minimum
Contribution, PHF may act as if a Request Notice
had been served on the last day that Moran could
have served a notice pursuant to clause 2.2.1 in
respect of that Lease Year requesting the Minimum
Contribution.
2.3.2 If Moran serves a Request Notice pursuant to
clause 2.2.1 but does not request the Minimum
Contribution, PHF may act as if the Request
Notice had requested the Minimum Contribution.
2.3.3 All of the provisions of clauses 2.6, 2.7, 2.8
and 2.9 apply to any action by PHF pursuant to
this clause 2.3 but nothing in this clause 2.3
requires PHF to take any action.
2.4 REQUIREMENTS OF REQUEST NOTICE
The Request Notice must:
(a) specify the Capex Contribution requested;
(b) specify the Property in respect of which the
Capex Contribution is requested;
(c) include a valuation of the relevant Property
from a valuer approved by PHF; and
(d) include a detailed calculation demonstrating
how the condition specified in clause 2.8
(Capex Contribution Conditions) will be
satisfied.
2.5 PHF TO CONSIDER REQUEST NOTICE
PHF must consider the Request Notice as soon as reasonably
practicable and must give written notice (Counter Request Notice)
to Moran as soon as reasonably practicable (and in any event
within 21 days) as to whether it considers the Capex Contribution
Conditions have been satisfied and if not the
<PAGE> 155
5
reasons why and in default of agreement between Moran and PHF as
to whether or not the Capex Contribution Conditions have been
satisfied the controversy must be determined pursuant to the
provisions of clause 2.13 of this agreement.
2.6 CAPEX CONTRIBUTION DATE
Subject to the Capex Contribution Conditions being satisfied and
subject to clause 2.7, PHF must pay the Capex Contribution for
the relevant Lease Year into the PHF Account on the Capex
Contribution Date and the Rent must be increased as provided for
in clause 2.9.
2.7 CAPEX CONTRIBUTION ACCOUNT
2.7.1 Moran must deposit into the Moran Account the sum
of $3,000,000 on the date of this agreement in
respect of the Minimum Capex for the period from
the date of this agreement to 30 September 1999.
2.7.2 On 1 October 1999, 2000, 2001, 2002 and 2003
Moran must deposit into the Moran Account an
amount equal to the Minimum Capex to be expended
during the ensuing 12 months as specified in
Schedule 5.
2.7.3 Without limiting the obligation of Moran pursuant
to clause 2.7.2, to the extent that an amount has
not been deposited into the Moran Account as
required by clause 2.7.2 so much of any Capex
Contribution that PHF must pay into the PHF
Account as is equal to the amount that should
have been deposited into the Moran Account as
required by clause 2.7.2 will be in reduction of
any obligation of Moran pursuant to clause 2.7.2
to the extent of such payment.
2.7.4 All monies from time to time in the PHF Account
will at all times remain the property of PHF
unless it is paid to Moran pursuant to clause
2.7.7.
2.7.5 All monies from time to time in the Moran Account
will at all times remain the property of Moran
but may only be dealt with as is provided for in
this agreement.
2.7.6 PHF must pay from the Moran Account or the PHF
Account to the relevant contractor to whom money
is due in respect of expenditure contemplated in
Schedule 5 any money requested by Moran which is
accompanied by:
(a) an invoice for the amount with sufficient
details to identify the relevant expenditure;
and
<PAGE> 156
6
(b) a certificate signed by a director of Moran
that the work referred to in the invoice has
been completed to its satisfaction and the
payment of the invoice is due.
2.7.7 When the Minimum Capex as contemplated in
Schedule 5 has been fully expended to the
satisfaction of PHF, acting reasonably, any
balance in either of the Moran Account which has
been deposited by Moran or the PHF Account which
has been deposited by PHF must be:
(a) retained in the Moran Account or the PHF
Account as applicable and paid in respect of
the future obligations of Moran under the
Lease which qualify as Assets and PHF must
pay from the Moran Account or the PHF Account
to the relevant contractor to whom money is
due, in respect of obligations of Moran under
the Lease, any money requested by Moran which
is accompanied by:
(i) an invoice for the amount with
sufficient details to identify the
relevant expenditure; and
(ii) a certificate signed by a director of
Moran that the work referred to in
the invoice has been completed to its
satisfaction and the payment of the
invoice is due; or
(b) paid to Moran in reimbursement of capital
expenditure obligation previously met by
Moran which qualify as Assets;
as directed by Moran.
2.7.8 Notwithstanding any other provision of this
agreement, PHF may expend from either the Moran
Account or the PHF Account any money to remedy
any obligation that Moran has not met under the
Lease.
2.8 CAPEX CONTRIBUTION CONDITIONS
2.8.1 The Capex Contribution Conditions are:
(a) for the period of 26 weeks prior to 30 June
preceding the relevant Request Date
(SATISFACTION PERIOD) if:
(i) the Capex Contribution had been paid
into the PHF Account at the
commencement of the
<PAGE> 157
7
Satisfaction Period and the Rent had
been increased during the whole of
the Satisfaction Period pursuant to
clause 2.9 by reference to that
payment; and
ii) any other payment that, under any
agreement between PHF and the
Covenantor or any Associate of the
Covenantor for the acquisition of a
Property, is conditional on the
satisfaction of the ratio of either
Gross Cash Flow to Rent or Cash Flow
to Rent for the same or similar
period had been paid at the
commencement of the Satisfaction
Period and the Rent had been
increased during the whole of the
Satisfaction Period pursuant to a
provision of the relevant agreement
corresponding to clause 2.9 by
reference to that payment;
the ratio of:
(A) Gross Cash Flow to Rent would not at
any time have been less than 1.5 to 1
during the Satisfaction Period ending
on 30 June 1999;
(B) Cash Flow to Rent would not at any
time have been less than 1.2 to 1
during the Satisfaction Period ending
on 30 June 2000;
(C) Cash Flow to Rent would not at any
time have been less than 1.25 to 1
during the Satisfaction Period ending
on 30 June 2001;
(D) Cash Flow to Rent would not at any
time have been less than 1.3 to 1
during each Satisfaction Period
ending after 30 June 2001;
(b) each Capex Contribution must be a minimum of Two-Hundred
and Fifty Thousand Dollars ($250,000);
(c) no Event of Default shall have occurred in relation to the
Lease or will occur at any time by reason of any payment
by PHF pursuant to this agreement;
(d) Moran has complied with the requirements of section
24.1(c) of the Lease on or before 31 August in respect of
the relevant Lease Year;
<PAGE> 158
8
(e) Moran has complied with all of the requirements of this
agreement with respect to giving the relevant Request
Notice;
(f) the relevant Capex Contribution is to be spent on items
that qualify as Assets;
(g) the Contribution Limit is not and will not be exceeded;
(h) Moran and PHF enters into such documents as PHF reasonably
requires confirming the Increased Rent and the increased
Initial Agreed Amount and revising the provisions of
Schedule 2 ("Proportion of Rent and Initial Agreed Amount
Applicable to each Leased Property") of the Lease (or the
corresponding provisions of a Supplemental Lease) to
increase the Agreed Amount allocated to the relevant
Property by the amount of the Capex Contribution for the
relevant Property;
(i) PHF has obtained the consent (if required) of any Superior
Lessor or Facility Mortgagee (which it shall use its
reasonable endeavours to obtain); and
(j) all of the above Capex Contribution Conditions remain
satisfied on the relevant Capex Contribution Date.
2.8.2 For the purpose of clause 2.8.1 (a):
(a) for the Satisfaction Period ended 30 June 1999 Gross Cash
Flow will be deemed to be the actual Gross Cash Flow for
the three months to 30 June 1999, reduced by the actual
accommodation fees received or to be received from the
Commonwealth of Australia under the Act for that period of
three months, multiplied by two, plus the forecast
accommodation fees to be received from the Commonwealth of
Australia under the Act for the six months to 31 December
1999; and
(b) for each Satisfaction Period that ends after 30 June 1999
Cash Flow will be deemed to be the actual Cash Flow for
the six months to the end of the relevant Satisfaction
Period, reduced by the actual accommodation fees received
or to be received from the Commonwealth of Australia under
the Act for that period of six months, plus the forecast
accommodation fees to be received from the Commonwealth of
Australia under the Act for the six months ending 31
December following the relevant Satisfaction Period.
<PAGE> 159
9
2.9 INCREASE IN RENT
Each time a Capex Contribution is paid by PHF into the PHF Account
pursuant to clause 2.2.1 or otherwise, the Rent (in both the Lease
and the Victorian Lease as the case shall require) shall be
increased on and from the Capex Contribution Date by an amount
derived by multiplying the amount of the Capex Contribution by the
greater of:
(i)9.6% increased by the same percentage
increase as the Rent is increased
pursuant to section 3.1 (b) of the
Lease between the Commencement Date
and the relevant Capex Contribution
Date; and
(ii)400 basis points above the rate last
quoted prior to the Capex
Contribution Date for 10 year
Australian Government Bonds.
2.10 INITIAL VICTORIAN CAPEX CONTRIBUTION
2.10.1 On the date of this agreement PHF must pay into
the PHF Account the Initial Victorian Capex
Contribution in respect of the completion of the
construction of the Victorian Properties, which
the parties acknowledge are in the course of
construction at the date of this agreement.
2.10.2 PHF must pay from the PHF Account to the relevant
contractor to whom money is due in respect of the
construction of the Victorian Properties any
money requested by Moran, up to the amount of the
Initial Victorian Capex Contribution, which is
accompanied by:
(a) an invoice for the amount with sufficient
details to identify the work done and the
relevant Victorian Property; and
(b) a certificate signed by a director of Moran
that the work referred to in the invoice has
been completed to its satisfaction and the
payment of the invoice is due.
2.10.3 On the date three months after completion of the
Victorian Purchase Agreement if any part of the
Initial Victorian Capex Contribution and any
interest earned on it, has not been fully
expended any balance of the Initial Victorian
Capex Contribution must immediately be paid to
Moran or its nominee on account of the purchase
price payable by PHF to Moran pursuant to the
Victorian Purchase Agreement to the extent that
it has not already been paid.
2.10.4 In the event that the Victorian Purchase
Agreement is not
<PAGE> 160
10
completed on or before 31 March 1999 Moran must
immediately repay the whole of the Initial
Victorian Capex Contribution without demand and
to the extent that there is any amount in the
Moran Account or the PHF Account on 1 April 1999
PHF may take it on account of the Initial
Victorian Capex Contribution.
2.11 ALLOCATION OF CAPEX CONTRIBUTIONS AND RENT INCREASES
2.11.1 The allocation of each Capex Contribution and the
increase of the Rent arising out of the Capex
Contributions as between the Properties will be
at the absolute discretion of PHF.
2.11.2 The amounts specified under the columns headed
"Agreed Amount" and "Rent" in the part of
Schedule 2 of the Lease entitled "Proportion of
Rent and Initial Agreed Amount Applicable to each
Leased Property" will be increased from time to
time to reflect the allocation of Capex
Contributions and Rent increases pursuant to this
agreement and the Lease must be read accordingly.
2.11.3 The definition of "Initial Agreed Amount" must be
read as if the amount specified in the definition
had been increased by each Capex Contribution and
the Lease must be read accordingly.
2.12 OBLIGATIONS UNDER LEASE NOT AFFECTED
Moran must comply with all of its obligations under the Lease
relating to capital expenditure whether or not PHF pays any Capex
Contribution pursuant to this agreement.
2.13 DISPUTES
Moran and PHF must meet to agree every amount for every purpose
under this agreement and failing agreement if there is any dispute
between PHF and Moran as to the calculation of any amount it will
be determined by the accountants who are the auditor for the time
being of PHF who will be deemed to be acting as an expert and not
an arbitrator and whose costs will be borne as determined by such
auditor.
2.14 CONSIDERATION PAYABLE TO MORAN
In consideration of the services provided by Moran to PHF pursuant
to clauses 2.7.6 and 2.10.2, if no Event of Default shall have
occurred in relation to the Lease or this agreement, PHF must pay
to Moran within one month following the end of each quarter of a
Lease Year an amount equal to 99.90% of the interest credited or
paid in respect of the PHF Account less all bank charges and fees
and all state and Commonwealth charges paid or debited in respect
of the PHF Account.
<PAGE> 161
11
3. GUARANTEE AND INDEMNITY
3.1 CONSIDERATION TO THE COVENANTOR
The Covenantor acknowledges that PHF enters into this agreement at
the Covenantor's request and subject to the Covenantor giving this
guarantee and indemnity and that the Covenantor has received
valuable consideration.
3.2 GUARANTEE FROM THE COVENANTOR
The Covenantor unconditionally and irrevocably guarantees the
punctual performance of all of Moran's obligations under this
agreement. The Covenantor must immediately upon demand pay PHF an
amount not paid when due by Moran under this agreement.
3.3 INDEMNITY
The Covenantor unconditionally and irrevocably indemnifies PHF
against all losses, damages, costs, charges, liabilities and
expenses which PHF may at any time suffer or incur because:
(a) an obligation of Moran expressed in this agreement is void,
voidable or wholly or partially unenforceable;
(b) PHF has to disgorge any money paid to it on Moran's account
under this agreement; or
(c) Moran fails to perform an obligation under this agreement.
3.4 PAYMENT OF MONEY BY THE COVENANTOR
The Covenantor must pay money owing under this agreement in
immediately available funds without deduction. The Covenantor
waives the right of set-off and the right to rely on a defence
available to Moran.
3.5 ACKNOWLEDGMENTS BY THE COVENANTOR
The obligations and liabilities of the Covenantor and the rights
of PHF under this agreement continue and are not affected by:
(a) PHF granting time or indulgence to Moran or another person;
(b) PHF compounding or compromising with or wholly or partially
releasing Moran or another person;
(c) laches, acquiescence, delay, acts, omissions or mistakes by
PHF;
(d) PHF taking, varying, wholly or partially discharging or
otherwise
<PAGE> 162
12
dealing with or losing or impairing any security for Moran's
obligations under this agreement or a security of that kind
being or becoming void, voidable or unenforceable;
(e) a person who is intended to assume liability as a guarantor
under this agreement not doing so effectively or being
discharged;
(f) a novation, assignment, termination or variation of this
agreement;
(g) the insolvency or deregistration of Moran or the Covenantor;
or
(h) anything else which might have a similar effect at law or in
equity to any of those actions or events.
<PAGE> 163
13
4. MISCELLANEOUS
4.1 PRESUMPTIONS OF INTERPRETATION
4.1.1 Unless the context otherwise requires a word
which denotes:
(a)the singular denotes the plural and vice
versa;
(b)any gender denotes the other genders;
and
(c)a person includes an individual, a body
corporate, and a government.
4.1.2 Unless the context otherwise requires a
reference to:
(a)any legislation includes any regulation
or instrument made under it and where
amended, re-enacted or replaced means
that amended, re-enacted or replacement
legislation;
(b)any other agreement or instrument where
amended or replaced means that agreement
or instrument as amended or replaced;
(c)a group of persons includes any one or
more of them; and
(d)a thing or amount is a reference to the
whole and each part of it.
4.1.3 Where a word or phrase is given a defined
meaning another part of speech or other
grammatical form in respect of that word or
phrase has a corresponding meaning.
4.2 HEADINGS AND TABLE OF CONTENTS
Headings and any table of contents must be ignored in the
interpretation of this agreement.
4.3 SUCCESSORS AND ASSIGNS
A person includes PHF, executor, administrator, successor in title
and assign of that person. This clause must not be construed as
permitting a party to assign any right or obligation under this
agreement.
4.4 REFERENCES TO AND CALCULATIONS OF TIME
4.4.1 Unless the context otherwise requires a
reference to a time of day means that time
of day in the state or territory whose laws
<PAGE> 164
14
apply in the construction of this agreement.
4.4.2 For the purposes of determining the length
of a period a reference to:
(a)a day means a period of time
commencing at midnight and ending 24 hours
later; and
(b)a month means a calendar month which is a
period commencing at the beginning of a day
of one of the 12 months of the year and
ending immediately before the beginning of
the corresponding day of the next month or,
if there is no corresponding day, ending at
the expiration of that next month.
4.4.3 Where a period of time is specified and
dates from a given day or the day of an act
or event it must be calculated exclusive of
that day.
4.4.4 Unless the context otherwise requires, a
term of this agreement which has the effect
of requiring anything to be done on or by a
date which is not a business day must be
interpreted as if it required it to be done
on or by the next business day.
4.5 NO RELIANCE ON OTHER MATTERS
Each of the parties acknowledges that in agreeing to enter into
this agreement it has not relied on any representation, warranty
or other assurance except those set out in this agreement.
4.6 LEGAL COSTS
Moran must pay all legal and other expenses relating directly or
indirectly to the negotiation, preparation and execution of this
agreement and all documents contemplated by or incidental to it.
4.7 STAMP DUTY AND OTHER CHARGES
4.7.1 Moran must pay all stamp duty payable in
connection with this agreement and any
document contemplated by or incidental to
it.
4.7.2 If a party other than Moran pays any stamp
duty on or relating to this agreement or a
document contemplated by or incidental to
it, Moran must pay that amount to the other
party on demand.
<PAGE> 165
15
4.8 AMENDMENT
This agreement may only be varied by the written agreement of the
parties.
4.9 APPROVALS AND CONSENT
4.9.1 Except when the contrary is stated in this
agreement, a party may give or withhold an
approval or consent to be given under this
agreement in that party's absolute
discretion and subject to those conditions
determined by the party.
4.9.2 A party is not obliged to give its reasons
for giving or withholding a consent or for
giving a consent subject to conditions.
4.10 ASSIGNMENT
The rights or obligations under this agreement may not be assigned
or transferred by Moran without the written consent of PHF.
4.11 COUNTERPARTS
This agreement may be executed in a number of counterparts and if
so executed, the counterparts taken together constitute one
agreement.
4.12 GOVERNING LAW
This agreement is governed by and must be construed in accordance
with the laws of New South Wales.
4.13 JURISDICTION
Each party:
(a)irrevocably and unconditionally submits
to the non-exclusive jurisdiction of the
courts of New South Wales and all courts
which have jurisdiction to hear appeals from
those courts; and
(b)waives any right to object to proceedings
being brought in those courts for any
reason.
<PAGE> 166
16
SCHEDULE 1
(NSW PROPERTIES)
<TABLE>
<CAPTION>
No. Name Address Title reference
<S> <C> <C> <C>
5. Annandale 76 Johnston Street, Annandale, NSW 2038 Auto-consol 9867-46
6. Armon 42 Croydon Street, Petersham, NSW 2049 1/110079
7. Bathurst 61 Boyd Street, Kelso, NSW 2795 11/806355
8. Bossley Park 56 Quarry Street, Bossley Park, NSW 2176 8/713734
9. Canterbury 16-20 Albert Street, Campsie, NSW 2194 1/549851
10. Crest 11 Johnston Street, Annandale, NSW 2038 1/913044 and 1/913045
11. Dubbo 80 Muller Street, Dubbo, NSW 2830 12/592842
12. Fernleigh 8-14 Sherbrooke Road, West Ryde, NSW 2114 1/201757 and 4/201757
13. Maitland 28 Broughton Street, Rutherford, NSW 2320 5/733509
14. Mudgee 207-213 Denison Street, Mudgee NSW 2850 1/261314
15. Murwillumbah Cnr North Arm Road and Ingram Place, 1/786640
Murwillumbah, NSW 2484
16. Narranderra 1A Chantilly Street, Narranderra, NSW 2700 2/582847 and 308/257212
17. Norah Head 63 Palomar Parade, Toukley, NSW 2263 721/26247 and 509/26247
18. Quakers Hill 35 Hambledon Road, Quakers Hill, NSW 2763 10/860042
19. Shoalhaven 43 Brinawarr Street, Bomaderry, NSW 2541 5/614886
20. Stanmore 66 Cambridge Street, Stanmore, NSW 2048 31/7/1
</TABLE>
<PAGE> 167
17
SCHEDULE 2
(QUEENSLAND PROPERTIES)
<TABLE>
<CAPTION>
No. Name Address Title reference
<S> <C> <C> <C>
21. Caloundra 4 Lyon Street, Caloundra, Qld 4551 2/177466
22. Nambour 9 Princess Crescent, Nambour, Qld 4560 2/183823
</TABLE>
<PAGE> 168
18
SCHEDULE 3
(VICTORIAN PROPERTIES)
<TABLE>
<CAPTION>
No. Name Address Title reference
<S> <C> <C> <C>
23. Altona 33-38 Rymill Court, Altona North, Victoria 3018 Vol. 8741 Fol. 761, 771
24. Meadow Heights 82-116 Lightwood Crescent, Meadow Vol. 10342 Fol. 086
Heights, Vic 3048
25. Mildura Cnr Ontario Avenue and Colonial Drive, Previously Vol.
Mildura, Vic 3500 9892 Fol. 717,
719, 720, now
being Lot 1 of
Plan of
Subdivision
409427J
(unregistered)
26. Warrnambool 170 Raglan Parade, Warrnambool, Vic 3280 Vol. 10346 Fol. 571
27. Whittlesea 202-290 McDonalds Road, Epping, Vic 3076 Vol. 10390 Fol. 104
</TABLE>
<PAGE> 169
19
SCHEDULE 4
(WA PROPERTIES)
<TABLE>
<CAPTION>
No. Name Address Title reference
<S> <C> <C> <C>
28. Applecross 30 Carron Road, Applecross, WA 6153 Vol. 1964 Fol. 640
29. Armadale 21 Angelo Street, Armadale, WA 6112 Vol. 1951 Fol. 293
(Hillview)
30. Bunbury 39 Hayes Street, Bunbury, WA 6230 Vol. 1534 Fol. 995
31. Geraldton 20 Milford Street, Geraldton, WA 6530 Vol. 1539 Fol. 329, Vol. 1890 Fol. 506
32. Kalgoorlie 6 Dugan Street, Kalgoorlie, WA 6430 Vol. 1597 Fol. 789
33. Murray River Cnr Coolibah and Boundary Roads, Vol. 1697 Fol. 190
Mandurah, WA 6210
34. Narrogin 52 Williams Road, Narrogin, WA 6312 Vol. 1634 Fol. 809
</TABLE>
<PAGE> 170
20
SCHEDULE 5
(BUDGETED NURSING HOME ABNORMAL EXPENDITURE)
<PAGE> 171
21
EXECUTED AS AN AGREEMENT
Signed by MORAN HEALTH CARE (AUSTRALIA)
PTY LIMITED BY:
<TABLE>
<S> <C>
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Signature of authorised person Signature of authorised person
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Office held Office held
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Name of authorised person (print) Name of authorised person (print)
Signed by MORAN HEALTH CARE GROUP PTY
LIMITED by:
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Signature of authorised person Signature of authorised person
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Office held Office held
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Name of authorised person (print) Name of authorised person (print)
</TABLE>
Signed by the attorney of PRINCIPAL
HEALTHCARE FINANCE PTY LIMITED under
power of attorney in the presence of:
<TABLE>
<S> <C>
. . . . . . . . . . . . . . . . . .
Signature of attorney
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Signature of witness Office held
</TABLE>
<PAGE> 172
22
<TABLE>
<S> <C>
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Name of witness (print) Name of attorney (print)
</TABLE>
<PAGE> 173
23
CAPITAL CONTRIBUTION AGREEMENT
(Moran Phase 2)
MORAN HEALTH CARE (AUSTRALIA) PTY LIMITED
MORAN HEALTH CARE GROUP PTY LIMITED
PRINCIPAL HEALTHCARE FINANCE PTY LIMITED
[PHILLIPS FOX LOGO]
<PAGE> 174
24
255 ELIZABETH STREET SYDNEY NSW 2000 AUSTRALIA
TEL +61 2 9286 8000 FAX +61 2 9283 4144 DX 107 SYDNEY
EMAIL: [email protected]
WWW SITE: HTTP://WWW.PHILLIPSFOX.COM.AU
<PAGE> 175
AGREEMENT FOR LEASE
DATED:
PARTIES
PRINCIPAL HEALTHCARE FINANCE PTY LIMITED ACN 069 875 476 c/- Phillips Fox, 255
Elizabeth Street, SYDNEY NSW 2000 ("LESSOR")
MORAN HEALTH CARE (AUSTRALIA) PTY LIMITED ACN 082 466 456 of 13 - 15 Bridge
Street, Sydney ("LESSEE")
MORAN HEALTH CARE GROUP PTY LIMITED ACN 008 585 242 of 13 - 15 Bridge Street,
Sydney ("GUARANTOR")
RECITALS
A The Lessor has entered into the Contract.
B Subject to completion of the Contract, the Lessor has agreed that it will
grant the Lease to the Lessee and the Lessee and the Guarantor have
agreed that the Lessee will take the Lease from the Lessor.
AGREEMENTS
1. DEFINITIONS AND INTERPRETATION
1.1 WORDS AND PHRASES DEFINED
In this agreement:
"AGREEMENT FEE" means $720,000 per annum.
"CONTRACT" means the Contract entered into by the Lessor to purchase the
Property dated on or about the same date as this agreement.
"LEASE" means the lease of the Property to be granted under this
agreement in the form annexed to this agreement.
"LEASE COMMENCEMENT DATE" means the date of completion of the Contract.
"NOTICE OF COMPLETION" means a written notice from the Lessor to the
Lessee stating that the Contract has been completed.
<PAGE> 176
-2-
"OBLIGATIONS" means each and all of the obligations of the Lessee under
this agreement including the due and punctual payment of the Agreement
Fee.
"PROPERTY" means the whole of the land described in Schedule 1, together
with all improvements.
"TERM" means the term of this agreement, commencing on the date of this
agreement and terminating on the Lease Commencement Date.
"TRUST" means the trust known as the "Principal Healthcare Finance Trust"
(formerly known as the "Assisted Living Unit Trust") constituted by a
deed of trust dated 11 August 1995 between Assisted Living (Holdings) Pty
Limited (now named Principal Healthcare Finance Pty Limited) as trustee
and Metlife Australia (Holdings) Pty Limited (now named Premier Care
Australia (Holdings) Pty Limited) and FAI Deposit Co Pty Limited (now
named First Mentor Group Pty Limited) as original unit holders.
"WORKS" means the works to be completed on the Property by the vendor
under the Contract.
1.2 NUMBERS AND GENDERS
Words importing the singular number include the plural, words importing a
particular gender include all genders, and words importing persons
include companies.
1.3 JOINT AND SEVERAL LIABILITY
Any covenant or agreement on the part of two or more persons are deemed
to bind them jointly and severally.
1.4 SEVERABILITY
The covenants and conditions in this agreement and each and every part of
them are to be construed so as not to infringe the provisions of any
applicable Act of Parliament. If any covenant or condition on its true
interpretation does infringe such a provision that covenant or condition
must be read down to the extent necessary to ensure that it does not
infringe and to such extent as is reasonable in order to give it a valid
operation. If the infringing covenant or condition cannot be so read down
it is to be deemed to be void and severable.
2. CONTRACT
2.1 NOTICE OF COMPLETION
The Lessor will give the Lessee a Notice of Completion within 7 days
after completion of the Contract.
<PAGE> 177
-3-
2.2 WORKS
The Lessee shall not require the Lessor to carry out any works to the
Property (including, but not limited to, the Works) either before or
after the Lease Commencement Date.
3. LEASE
3.1 TERM ETC.
Subject to clause 3.5, the Lessor and the Lessee will enter into the
Lease of the Property for a term commencing on the Lease Commencement
Date, on the rent and on the terms and conditions in the Lease, completed
as provided in clause 3.3.
3.2 EXECUTION OF LEASE
The Lessee must simultaneously with the making of this agreement duly
execute the Lease and deliver the Lease to the Lessor to be held in
escrow pending the completion of the Contract.
3.3 COMPLETION OF DETAILS
The Lessee irrevocably authorises and directs the Lessor and its
solicitors to complete and deliver the Lease with effect on and from the
Lease Commencement Date by inserting:
(a)the then current particulars of the Lessor and of any other
party to the Lease;
(b)the Lease Commencement Date;
(c)the date of termination of the term;
(d)the date of the Lease; and
(e)any other relevant or necessary details and information
to properly record the agreement between the Lessor and the
Lessee and to complete and stamp the Lease.
3.4 STAMPING LEASE AND AGREEMENT
The Lessor agrees to stamp this agreement and the Lease at the cost of
the Lessee. Stamp duty on the Lease must be paid by the Lessee to the
Lessor's solicitors on notification by the Lessor's solicitors of an
assessment of the stamp duty payable. The stamp duty must be paid by the
Lessee in time to allow payment by the Lessor's solicitors within the
time required to avoid interest or penalty.
3.5 CONTRACT NOT COMPLETED
<PAGE> 178
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The Lessor shall be under no obligation to grant the Lease to the Lessee
if the Contract is not completed.
4. OPTIONAL TERMINATION DATE
4.1 LESSOR MAY TERMINATE
If the Contract:
(a)is not completed by 31 March 1999; or
(b)is rescinded or terminated;
the Lessor may terminate this agreement by notice in writing to the
Lessee.
4.2 NO COMPENSATION
If the Lessor terminates the agreement under clause 4.1, the Lessor will
be entitled to claim from the Lessee any sum, by way of damages,
compensation or otherwise for or because of any loss damage or other
expenses or outgoings which the Lessor may incur as a result of the
termination of this agreement.
5. AGREEMENT FEE
5.1 PAYMENT OF FEE
The Lessee covenants to pay the Agreement Fee to the Lessor during the
Term:
(a)by direct debit to whichever bank account the Lessor
directs;
(b)in equal, consecutive monthly instalments in advance on
the first day of each calendar month;
or to such other persons, firms or corporations or in such other manner
as the Lessor from time to time may designate.
5.2 FIRST PAYMENT
The first monthly payment of the Agreement Fee shall be payable on the
date of this agreement. The Agreement Fee shall be prorated as to any
partial months at the beginning and end of the Term.
6. MORTGAGEES CONSENT
<PAGE> 179
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The Lessor covenants with the Lessee that it will at the Lessee's cost
obtain an unconditional consent of any mortgagee from time to time of the
Property or any part of it to this agreement and the Lease.
7. GUARANTEE
PERFORMANCE OF OBLIGATIONS
7.1 The Guarantor guarantees to the Lessor that the Lessee will
perform all of the Obligations and in default of the performance
by the Lessee of any of the Obligations, the Guarantor covenants
with the Lessor to perform the Obligations or cause them to be
performed as if the Obligations were primarily the responsibility
of the Guarantor.
7.2 If the Lessee defaults in the payment of any money under this
agreement, the Guarantor will on demand by the Lessor pay the
money to the Lessor.
7.3 If the Lessee fails to comply with any of the Obligations the
Guarantor will on demand:
(a)perform any such Obligation; and
(b)pay to the Lessor damages, expenses and costs; and
(c)reimburse the Lessor for all losses;
which the Lessor has incurred or suffered whether or not the Lessor has
exercised or exhausted its remedies for recovery from the Lessee.
CONTINUING GUARANTEE
7.4 This guarantee and indemnity is a continuing guarantee and
indemnity. This guarantee and indemnity will not be considered as
wholly or partly satisfied or discharged by:
(a)the payment or liquidation at any time after the date of
this agreement of any money due to the Lessor; or
(b)any settlement of account; or
(c)any other matter or thing.
7.5 This guarantee and indemnity will extend to cover all money at any
time due to the Lessor notwithstanding any special payment,
liquidation or settlement of account or other matter or thing.
<PAGE> 180
-6-
7.6 This guarantee and indemnity will not be prejudiced or discharged
or in any way affected by:
(a) any transaction or arrangement that may take place between the
Lessor and the Lessee or the Guarantor or any other person;
(b) any compromise, release, abandonment, waiver, variation,
renewal or relinquishment of any of the rights of the Lessor
against the Lessee, the Guarantor or any other person;
(c) the winding up or bankruptcy of the Lessee, the Guarantor or
any other person;
(d) any failure or omission by the Lessee, the Lessor or any other
person to give notice to the Guarantor of any default by the
Lessee under the Contract or under any other agreement or
arrangement with the Lessee;
(e) any laches, acts, omissions or mistakes on the part of the
Lessor;
(f) the Lessor obtaining judgment against the Lessee, the
Guarantor or any other person for the payment of the Agreement Fee
or other money or for the performance or otherwise of any act,
matter of thing which the Lessee by the Contract has agreed to
pay, do or not to do;
(g) any settlement of account or act, matter or thing; or
(h) this agreement being unenforceable, void or voidable.
7.7 This guarantee and indemnity will continue and remain in full
force and effect until the Lessee has performed all of the
Obligations.
LESSOR MAY GRANT INDULGENCE OR REFRAIN
7.8 The Lessor may, without prejudicing or discharging or in any way
affecting the liability of the Guarantor under this Deed:
(a) grant any time or other indulgence or consideration or
concession to the Lessee or the Guarantor or any other person,
firm or corporation;
(b) compound, compromise with or release the Lessee or any other
person and assent to any assignment or trust deed for the benefit
of creditors or any scheme or deed of arrangement by the Lessee or
any other person and whether with or without the winding up or
sequestration of the estate of the Lessee or of the other person;
<PAGE> 181
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(c)release or discharge the Lessee in respect of the payment
of money or otherwise; or
(d)forebear to require the Lessee to pay any money or to do
or refrain from doing any act, matter or thing which the
Lessee by the Contract has agreed to pay or do or not to do.
7.9 The Lessor may exercise or refrain from exercising any of the
powers or discretions conferred on the Lessor by law or by this
agreement or any other arrangement or agreement with the Lessee,
the Guarantor or any other person without the consent of the
Guarantor and without prejudicing, discharging or in any way
affecting the liability of the Guarantor under this agreement.
WAIVER BY GUARANTOR
7.10 The Guarantor waives in favour of the Lessor so far as may be
necessary to give effect to anything contained or implied in this
agreement all rights whatever against the Lessor, the Lessee and
any other person or any estate or asset including rights of
subrogation, contribution and marshalling.
7.11 If the Lessee makes any arrangement, assignment or composition for
the benefit of creditors, becomes bankrupt or goes into
liquidation the Guarantor will not prove in competition with the
Lessor. The Guarantor authorises the Lessor to prove for all money
which the Guarantor has paid under this agreement and to
appropriate any money so received until the Lessor has received
all money due to the Lessor in respect of the indebtedness or
liabilities of the Lessee under or arising out of this agreement.
7.12 If the Guarantor makes any arrangement, assignment or composition
for the benefit of creditors, becomes bankrupt or goes into
liquidation the Lessor will be entitled to prove for the money
guaranteed by this agreement and all other money payable under
this agreement whether due under this agreement or not up to the
limit (if any) of the liability of the Guarantor under this
agreement.
INDEMNITY
7.13 The Guarantor agrees with the Lessor that notwithstanding:
(a)anything contained or implied in this agreement;
(b)the money guaranteed by this agreement may not be
recoverable or not presently recoverable from the Lessee for
any reason or circumstance whatever; or
(c)any other act, matter or thing by which the Obligations
are not enforceable on the footing of this agreement;
<PAGE> 182
-8-
the Guarantor as a separate and additional liability indemnifies and will
keep indemnified the Lessor in respect of all the Obligations and as a
principal debtor agrees to pay to the Lessor on demand in writing a sum
of money equal to any loss, damage, cost, charge or expense which if the
payment were not made would otherwise be suffered or incurred by the
Lessor as a result of default in performance by the Lessee of any of the
Obligations.
8. LIMITATION OF LIABILITY
8.1 CAPACITY
The Lessor enters into this Lease only in its capacity as trustee of the
Trust and in no other capacity. A liability arising under or in
connection with this Lease can be enforced against the Lessor only to the
extent to which it can be satisfied out of property of the Trust out of
which the Lessor is actually indemnified for the liability. This
limitation of the Lessor's liability applies despite any other provision
of this agreement and extends to all liabilities and obligations of the
Lessor in any way connected with any representation, warranty, conduct,
omission, agreement or transaction related to this agreement.
8.2 PROCEEDINGS
The parties other than the Lessor may not sue the Lessor personally or
seek the appointment of a liquidator, administrator, receiver or similar
person to the Lessor or prove in any liquidation, administration or
arrangement of or affecting the Lessor.
8.3 FRAUD AND NEGLIGENCE
The provisions of this clause 8 shall not apply to any obligation or
liability of the Lessor to the extent that it is not satisfied because
under the trust deed establishing the Trust or by operation of law there
is a reduction in the extent of the Lessor's indemnification out of the
assets of the Trust, as a result of the Lessor's fraud, negligence or
breach of trust.
9. COSTS
The Lessee will pay the Lessor's costs and expenses of and incidental to
the instructions for, preparation, perusal, negotiation and execution of
this agreement,and of any document evidencing any variation of it and the
Lease.
10. GOVERNING LAW
This agreement is governed by and is to be construed in accordance with
the law of Victoria.
<PAGE> 183
-9-
SCHEDULE ONE
Altona Vol. 8741 Fol. 761, 771
Meadow Heights Vol. 10342 Fol. 086
Mildura Previously Vol. 9892 Fol. 717, 719, 720 now
being Lot 1 of Plan of Subdivision 409427J
(unregistered)
Warrnambool Vol. 10346 Fol. 571
Whittlesea Vol. 10390 Fol. 104
<PAGE> 184
-10-
EXECUTED AS A DEED
Signed, sealed and delivered by the attorney of
PRINCIPAL HEALTHCARE FINANCE PTY LIMITED
under power of attorney registered Book
............ No ............ in the presence of:
<TABLE>
<S> <C>
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Signature of witness Signature of attorney
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Name of witness (print) Name of attorney (print)
Executed by MORAN HEALTH CARE (AUSTRALIA)
PTY LIMITED without a common seal acting by:
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Signature of authorised person Signature of authorised person
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Office held Office held
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Name of authorised person (print) Name of authorised person (print)
Executed by MORAN HEALTH CARE GROUP PTY
LIMITED without a common seal acting by:
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Signature of authorised person Signature of authorised person
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Office held Office held
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Name of authorised person (print) Name of authorised person (print)
</TABLE>
<PAGE> 185
AGREEMENT FOR LEASE
(VICTORIA)
PRINCIPAL HEALTHCARE FINANCE PTY LIMITED
("LESSOR")
MORAN HEALTH CARE (AUSTRALIA) PTY LIMITED
("LESSEE")
MORAN HEALTH CARE GROUP PTY LIMITED
("GUARANTOR")
255 Elizabeth Street Sydney NSW 2000 Australia
Tel +61 2 9286 8000 Fax +61 2 9283 4144 DX 107 SYDNEY
Email: [email protected] WWW site:
http://www.PhillipsFox.com.au
Ref: VAC :965155
<PAGE> 186
RELATIONSHIP AGREEMENT
(Moran Phase 2)
THIS AGREEMENT IS MADE AS A DEED ON NOVEMBER 12 1998
PARTIES
PRINCIPAL HEALTHCARE FINANCE PTY LIMITED ACN 069 875 476 of Level 12, 255
Elizabeth Street, Sydney, New South Wales, Australia
MORAN HEALTH CARE (AUSTRALIA) PTY LIMITED ACN 082 466 457 of 13 - 15 Bridge
Street Sydney, New South Wales, Australia (MORAN)
PETER ANNA PTY LIMITED ACN 000 724 792 of 13 - 15 Bridge Street Sydney, New
South Wales, Australia (PETER ANNA)
MORAN HEALTH CARE GROUP (WA) PTY LIMITED ACN 009 029 216 of 13 - 15 Bridge
Street Sydney, New South Wales, Australia (MORAN WA)
MORAN HEALTH CARE GROUP PTY LIMITED ACN 008 585 242 of 13 - 15 Bridge Street
Sydney, New South Wales, Australia (COVENANTOR)
BACKGROUND
A The Covenantor is the sole beneficiary of the Moran Trust.
B Moran is the trustee of the Moran Trust.
C The Covenantor, Moran, Peter Anna and Moran WA have requested PHF
as trustee of the Principal Healthcare Finance Trust to:
(a) purchase the Queensland Properties, NSW Properties,
Victorian Properties and WA Properties; and
(b) lease the Queensland Properties, NSW Properties, Victorian
Properties and WA Properties to Moran.
D PHF is willing to accede to the requests of Moran, Peter Anna,
Moran WA and the Covenantor on the terms and conditions of this
agreement.
AGREEMENT
1. DEFINITIONS
<PAGE> 187
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In this agreement:
ACT means the Aged Care Act 1997 (Cth).
AGED CARE PLACES means Places in respect of the Victorian
Properties and includes all the right, title and interest of a
person conferred by or under the Act in respect of those Places.
AGREED DATE means the first anniversary of the date of this
agreement.
AGREEMENT TO SELL means any agreement by which the Covenantor
agrees, or has agreed, to sell Aged Care Places to PHF.
ALTONA SURPLUS LAND means lots 2, 3, 4 and 5 in the draft plan of
subdivision annexed to this agreement and marked A.
LEASE means the lease of the NSW Properties, Queensland Properties
and WA Properties from PHF to Moran dated on or about the date of
this agreement.
MEADOW HEIGHTS SURPLUS LAND means lots 1, 2, 3, 4, 5, 6, 7, 8, 9,
10, 11, 12, 13 and 14 in the draft plan of subdivision annexed to
this agreement and marked B.
MORAN RELATED ENTITY means any person that is an associate of the
Covenantor or Moran for the purpose of section 318 of the Tax Act.
MORAN SECURITY DOCUMENTS means the Deed of Fixed and Floating
Charge dated 19 June 1998 between Premier and Moran, the Mortgage
of Shares by the Covenantor to Premier dated 19 June 1998 and the
Mortgage of Units in the Moran Trust by the Covenantor to Premier
dated 19 June 1998[, and deeds of fixed and floating charge to be
dated on or about the date of this agreement between PHF and
various related bodies corporate of the Covenantor in respect of
the Properties].
MORAN TRUST means the trust known as "The Moran Health Care
Australia Trust" constituted by a deed of trust dated 13 May 1998
between Moran Health Care (Australia) Pty Limited as trustee and
Moran Health Care Group Pty Limited as original unit holder.
NAMBOUR SURPLUS LAND means lot 2 in the draft plan of subdivision
annexed to this agreement and marked C.
NARROGIN LAND means all that land in Western Australia in Volume
1634 Folio 809 being Lot 501 on Diagram 57064.
NARROGIN SURPLUS LAND means any land forming part of the Narrogin
Land which is certified by Robert I Lister, in writing to PHF,
within three months
<PAGE> 188
-3-
following the date of this agreement, to be land that if it were
excluded from his valuation of the Narrogin Land dated 31 August
1998 the total quantum of his valuation of the remaining land
would be $1,940,000.
NSW PROPERTIES means the properties identified as such in Schedule
A.
PHF means Principal Healthcare Finance Pty Limited or any other
trustee for the time being of the Trust.
PLACE means a "place" (as that term is defined in the Act).
PREMIER means Premier Care Australia Pty Limited (now named
Principal Healthcare Finance Pty Limited) ACN 069 875 476.
PROPERTIES means any one or more of the Queensland Properties, NSW
Properties, Victorian Properties or WA Properties.
QUEENSLAND PROPERTIES means the properties identified as such in
Schedule A.
SURPLUS LAND means the Altona Surplus Land, the Meadow Heights
Surplus Land, the Nambour Surplus Land and the Narrogin Surplus
Land.
TRUST means the trust known as the "Principal Healthcare Finance
Trust" (formerly known as the "Assisted Living Unit Trust")
constituted by a deed of trust dated 11 August 1995 between
Assisted Living (Holdings) Pty Limited (now named Principal
Healthcare Finance Pty Limited) as trustee and Metlife Australia
(Holdings) Pty Limited (now named Premier Care Australia
(Holdings) Pty Limited) and FAI Deposit Co Pty Limited (now named
First Mentor Group Pty Limited) as original unit holders.
VICTORIAN ACQUISITION AGREEMENT means the agreement between the
Covenantor and PHF for the purchase of the Victorian Properties by
PHF dated on or about the date of this agreement.
VICTORIAN AGREEMENT TO LEASE means the agreement to lease the
Victorian Properties from PHF to Moran dated on or about the date
of this agreement.
VICTORIAN PROPERTIES means the properties identified as such in
Schedule A.
WA PROPERTIES means the properties identified as such in Schedule
A.
$ means Australian dollars.
2. COMMITMENT FEE
Moran must pay to PHF on the date of this agreement $1,050,000 in
<PAGE> 189
-4-
consideration of PHF entering into this agreement and other
agreements and arrangements with Moran and other bodies corporate
which are related bodies corporate, as defined in the Corporations
Law, of Moran.
3. EMPLOYEES
If at any time PHF becomes entitled to possession of any Property
by reason of the termination of any lease between PHF and Moran or
PHF becomes entitled to take possession of or to appoint a
receiver of any asset of Moran, the Covenantor or a Moran Related
Entity pursuant to a Moran Security Document PHF or the receiver,
as the case may require, may offer to employ any person employed
by Moran, the Covenantor or a Moran Related Entity in connection
with that Property on such terms as that person may determine and
Moran and the Covenantor must do all things that they are legally
able to do to procure that such employees accept such offer.
4. AGREEMENT TO SELL AND VICTORIAN ACQUISITION AGREEMENT
If the Covenantor is in default of any obligation under an
Agreement to Sell, the Victorian Acquisition Agreement or the
Victorian Agreement to Lease for any reason such default is deemed
to be an event of default under the Lease and PHF may exercise its
rights pursuant to the Lease as if this provision was expressed in
it.
5. SALE OF SURPLUS LAND
5.1 SUBDIVISION AND TRANSFER OF SURPLUS LAND
5.1.1 If any Surplus Land is not on separate titles PHF
must provide to Moran such consents as Moran may
reasonably require to enable the Surplus Land to
be subdivided from any other land of which it
forms part which is owned by PHF and Moran may at
its own cost and expense cause that land to be so
subdivided.
5.1.2 If the Altona Surplus Land is on a separate title
Moran may prior to the Agreed Date request PHF in
writing to transfer the Altona Surplus Land to
Moran or its nominee and PHF must transfer the
Altona Surplus Land to Moran or its nominee for
the sum $1 free of all security interests given
by PHF.
5.1.3 If the Meadow Heights Surplus Land is on a
separate title Moran may prior to the Agreed Date
request PHF in writing to transfer the Meadow
Heights Surplus Land to Moran or its nominee and
PHF must transfer the Meadow Heights Surplus Land
to Moran or its nominee for the sum $1 free of
all security interests given by PHF.
5.1.4 If the Nambour Surplus Land is on a separate
title Peter Anna may
<PAGE> 190
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prior to the Agreed Date request PHF in writing
to transfer the Nambour Surplus Land to Peter
Anna or its nominee and PHF must transfer the
Nambour Surplus Land to Peter Anna or its nominee
for the sum $1 free of all security interests
given by PHF.
5.1.5 If the Narrogin Surplus Land is on a separate
title Moran WA may prior to the Agreed Date
request PHF in writing to transfer the Narrogin
Surplus Land to Moran WA or its nominee and PHF
must transfer the Narrogin Surplus Land to Moran
WA or its nominee for the sum $1 free of all
security interests given by PHF.
5.2 OBLIGATIONS OF MORAN
Moran is solely responsible for all expenses in relation to the
subdivision of any land determined to be Surplus Land pursuant to
clause 5.1.1 including without limitation:
(a)obtaining of all regulatory consents and
planning approvals;
(b)any necessary expenses of sub-division; and
(c)all other costs of PHF including:
(c)the costs associated with the surrender of any
lease or sub-lease in respect of the Surplus
Land;
(c)the costs of obtaining any consent from any
financier, lender or other person in any capacity
paid or payable by PHF in connection with any
such subdivision or transfer;
and to the extent that any amount is paid or payable by PHF
pursuant to this clause 5.2 PHF will not be obliged to give any
consent or make any transfer until the same has been paid in full.
5.3 MORANS RIGHT TO CAVEAT
5.3.1 Subject to clause 5.3.2, Moran may lodge caveats
over the Altona Surplus Land and the Meadow
Heights Surplus Land, Peter Anna may lodge a
caveat over the Nambour Surplus Land and Moran WA
may lodge a caveat over the Narrogin Surplus Land
in respect of their respective interests in those
properties under this
agreement.
5.3.2 Moran, Peter Anna and Moran WA must not lodge any
caveat as contemplated in clause 5.3.1 until
after the mortgage to be granted by PHF to ABN
AMRO Australia Pty Limited on the date of this
agreement is lodged for registration in the
appropriate State
<PAGE> 191
-6-
registry
5.3.3 Moran, Peter Anna and Moran WA (as caveator) must
give their consent to any dealing PHF wishes to
lodge in respect of the land of which the Surplus
Land forms part but which does not adversely
affect their interests in the Surplus Land.
6. DUBBO EASEMENT
6.1 PHF TO CONSENT
PHF will at the request of Moran consent to the registration of
the plan and the instrument a copy of which is annexed to this
agreement and marked D and will cause to be produced to the Land
Titles Office in New South Wales the relevant certificate of title
to permit registration of the plan and instrument.
6.2 OBLIGATIONS OF MORAN
Moran is solely responsible for all expenses in relation to the
registration of the plan and instrument pursuant to clause 6.1
including without limitation:
(a) obtaining of all regulatory consents and planning
approvals;
(b) any necessary expenses incurred in connection with the
registration of the plan and instrument; and
(c) all other costs of PHF including the costs of obtaining
any consent from any financier, lender or other person in
any capacity paid or payable by PHF in connection with
the registration of the plan and instrument;
and to the extent that any amount is paid or payable by PHF
pursuant to this clause 6.2 PHF will not be obliged to give any
consent or produce any document until the same has been paid in
full.
7. GUARANTEE AND INDEMNITY FROM THE COVENANTOR
7.1 CONSIDERATION TO THE COVENANTOR
Moran enters into this agreement as the trustee of the Moran
Trust. The Covenantor is the ultimate holding company of Moran and
the ultimate beneficiary of the Moran Trust and the Covenantor
acknowledges that PHF enters into this agreement at the
Covenantor's and Moran's request and subject to the Covenantor
giving the guarantee and indemnity in this clause and that the
Covenantor and Moran
<PAGE> 192
-7-
has received valuable consideration.
7.2 GUARANTEE FROM THE COVENANTOR
7.2.1 The Covenantor unconditionally and irrevocably
guarantees to PHF the due and punctual
performance of all of Moran's obligations under
this agreement. The Covenantor must immediately
upon demand perform any obligation owed by Moran
to PHF and not performed by Moran when required
or provided for under this agreement.
7.2.2 The Covenantor's obligations under this
agreement:
(a)are principal obligations and not ancillary or
collateral to any other obligation; and
(b)may be enforced against the Covenantor without
PHF being required to exhaust any remedy it may
have against Moran or to enforce any security it
may hold with respect to Moran's obligations.
7.3 INDEMNITY
The Covenantor unconditionally and irrevocably indemnifies PHF
against all losses, damages, costs, charges, liabilities and
expenses which it may at any time suffer or incur because:
(a) an obligation of Moran expressed in this agreement is void,
voidable or wholly or partially unenforceable;
(b) it has to disgorge any money paid to it on Moran's account
under this agreement; or
(c) Moran fails to perform an obligation under this agreement.
7.4 PAYMENT OF MONEY BY THE COVENANTOR
The Covenantor must pay money owing under this clause in
immediately available funds without deduction.
7.5 ACKNOWLEDGMENTS BY THE COVENANTOR
The liability of the Covenantor is absolute and unconditional and
is not affected by any act, omission, matter or thing which, but
for this provision might operate to release or otherwise exonerate
it from any of its
<PAGE> 193
-8-
obligations including, without limitation, any one or more of the
following (whether occurring with or without the consent of any
person):
(a) PHF granting time or indulgence to Moran, the Covenantor or
another person;
(b) PHF compounding or compromising with or wholly or partially
releasing Moran, the Covenantor or another person;
(c) laches, acquiescence, delay, acts, omissions or mistakes by
PHF;
(d) PHF taking, varying, wholly or partially discharging or
otherwise dealing with or losing or impairing any security
for Moran's or the Covenantor obligations under this
agreement or a security of that kind being or becoming
void, voidable or unenforceable;
(e) a person who is intended to assume liability as a guarantor
under this agreement not doing so effectively or being
discharged;
(f) a novation, assignment, termination or variation of this
agreement;
(g) the insolvency or deregistration of Moran or the
Covenantor; or
(h) anything else which might have a similar effect at law or
in equity to any of those actions or events.
8. DISPUTE RESOLUTION
8.1 RESOLUTION BY CHARTERED ACCOUNTANT
The parties agree that any dispute between them in relation to the
amounts payable pursuant to this agreement will be resolved by a
chartered accountant of not less than ten year's standing
appointed by agreement between them or, failing agreement, by the
President for the time being of The Institute of Chartered
Accountants in Australia.
8.2 CHARTERED ACCOUNTANT TO ACT AS AN EXPERT
The person appointed pursuant to clause 8.1 will act as an expert
not an arbitrator and that person's decision will be final and
binding on the parties.
<PAGE> 194
-9-
8.3 COSTS
The costs of resolution of the dispute in accordance with this
clause will be borne in accordance with the directions of the
person resolving the dispute.
9. WARRANTIES
Each of the parties represent and warrant one unto the other that:
(a) it has been duly authorised and has the power and
authority to enter into and perform its obligations
under this agreement and to carry out the transactions
contemplated by this agreement; and
(b) the transaction contemplated by this agreement will
not violate its constituent documents or any other
document or agreement or any law or judgment binding
on it; and
(c) its obligations under this agreement are valid and
binding and enforceable against it in accordance with
its terms.
10. CONFIDENTIALITY AND ANNOUNCEMENTS
10.1 CONFIDENTIALITY
Each party agrees to keep as confidential information the terms of
this agreement and the contents of all negotiations leading to its
preparation, and will not disclose or discuss any of that
information without the prior written approval of the other party,
except:
(a) as specifically contemplated by this agreement;
(b) to the extent required by law;
(c) to the extent required by the requirements of a stock
exchange on which the party's shares (or that of its
holding company) are listed;
(d) to the extent required by that party's financiers or
intended financiers in relation to provision of
finance for completion of the transactions
contemplated by this agreement; or
(e) to the extent required to instruct the party's
professional advisers in relation to the
<PAGE> 195
-10-
preparation and completion of this agreement.
10.2 ANNOUNCEMENTS
No announcements concerning this agreement or its subject matter
or any ancillary matter will be made before, on or after the date
of this agreement by any party except as required by law or a
stock exchange or by any other regulatory body without the prior
written approval of the parties (such approval not to be
unreasonably withheld or delayed).
11. NOTICES
11.1 MEANS OF GIVING NOTICES
Except if specified otherwise in a term of this agreement, a
notice may be given to the addressee by:
(a)elivering it in writing to the street address of the
addressee which includes placing it in a postal receptacle
provided for the address or leaving it at the address with
a person apparently of or over the age of 16 years;
(b)sending it by prepaid ordinary post (airmail if
outside Australia) to the street address of the addressee;
or
(c)sending it by facsimile to the facsimile number of the
addressee.
11.2 SPECIFIED ADDRESS FOR SERVICE
Until a party gives notice of a change, the street address and
facsimile number for that party is:
Moran, Peter Anna, Moran WA and the Covenantor
street address: the address specified on page 1 of this agreement
facsimile number: 61 2 9247 1667
PHF
street address: the address of PHF specified on page 1 of this
agreement
facsimile number: 61 2 9286 8191
with a copy to:
<PAGE> 196
-11-
Omega (UK) Limited 145 Cannon Street, London EC4N 5 BP, England
facsimile number: 44 171 929 3555
with a copy to:
Phillips Fox, 255 Elizabeth Street, Sydney, NSW 2000, Attention
Robert Tobias/Bill Chapman
facsimile number: 61 2 9286 8191
11.3 TIME NOTICES ARE GIVEN
Except if a later time is specified in a term of this agreement
dealing with a notice, a notice is to be regarded as received by
the addressee:
(a)if delivered in writing to the street address of the
addressee, at the time of delivery;
(b)if it is sent by post to the street address of the
addressee, on the third (seventh if outside Australia) day
after posting; or
(c)if sent by facsimile to the facsimile number of the
addressee, at the time transmission is completed.
11.4 PROOF OF GIVING NOTICES BY FACSIMILE
Proof of the sending of a notice by facsimile and the time of
completion of transmission may be established by production of a
transmission report by the machine from which the facsimile was
sent which indicates that the facsimile was sent in its entirety
to the facsimile number of the addressee.
11.5 COPIES OF NOTICES
If a party is required by any term of this agreement to give a
copy of a notice to a person the failure to give the copy of the
notice to the person may not be raised to rebut the effective
giving of the notice.
12. MISCELLANEOUS
12.1 PRESUMPTIONS OF INTERPRETATION
12.1.1 Unless the context otherwise requires a word
which denotes:
<PAGE> 197
-12-
(a)the singular denotes the plural and vice
versa;
(b)any gender denotes the other genders; and
(c)a person includes an individual, a body
corporate, and a government.
12.1.2 Unless the context otherwise requires a reference
to:
(a)any legislation includes any regulation or
instrument made under it and where amended,
re-enacted or replaced means that amended,
re-enacted or replacement legislation;
(b)any other agreement or instrument where
amended or replaced means that agreement or
instrument as amended or replaced; and
(c)a group of persons includes any one or more of
them.
12.1.3 Where a word or phrase is given a defined meaning
another part of speech or other grammatical form
in respect of that word or phrase has a
corresponding meaning.
12.2 HEADINGS AND TABLE OF CONTENTS
Headings and any table of contents must be ignored in the
interpretation of this agreement.
12.3 JOINT AND SEVERAL
An agreement warranty representation or obligation which binds or
benefits two or more persons under this agreement binds or
benefits those persons jointly and separately.
12.4 SUCCESSORS AND ASSIGNS
A person includes the trustee, executor, administrator, successor
in title and assign of that person. This clause must not be
construed as permitting a party to assign any right or obligation
under this agreement.
12.5 BUSINESS DAY
A business day is a day other than a Saturday or Sunday during
which banks are open for general banking business in New South
Wales.
<PAGE> 198
-13-
12.6 REFERENCES TO AND CALCULATIONS OF TIME
Unless the context otherwise requires a reference to a time of day
means that time of day in the state or territory whose laws apply
in the construction of this agreement.
12.7 LEGAL COSTS
Moran must pay the legal and other expenses relating directly or
indirectly to the negotiation, preparation and execution of this
agreement and all documents arising under, relating to, referred
to contemplated or incidental to it including its own and those of
each other party.
12.8 STAMP DUTY AND OTHER CHARGES
12.8.1 Moran must promptly pay within the time required
to avoid interest or penalty all stamp duty, fees
and other taxes and charges payable in connection
with:
(a)this agreement and any document incidental to
it;
(b)the registration and filing of this agreement
and any document incidental to it.
12.8.2 If a party other than the Moran Trust pays any
stamp duty on or relating to this agreement or a
document incidental to it, the Moran Trust must
pay that amount to the other party on demand.
12.9 AMENDMENT
This agreement may only be varied by the written agreement of the
parties.
12.10 APPROVALS AND CONSENT
12.10.1 Except when the contrary is stated in this
agreement, a party may give or withhold an
approval or consent to be given under this
agreement in that party's absolute discretion and
subject to those conditions determined by the
party.
12.10.2 A party is not obliged to give its reasons for
giving or withholding a consent or for giving a
consent subject to conditions.
<PAGE> 199
-14-
12.11 ASSIGNMENT
Moran may only assign a right or obligation under this agreement
with the prior written consent of PHF and the Company which may be
given or withheld in their absolute discretion.
12.12 COUNTERPARTS
This agreement may be executed in a number of counterparts and if
so executed, the counterparts taken together constitute one
agreement.
12.13 ENTIRE AGREEMENT
12.13.1 The Transaction Documents together with this
agreement embody the entire understanding and
agreement between the parties as to the subject
matter of this agreement.
12.13.2 All previous negotiations, understandings,
representations, warranties, memoranda or
commitments in relation to, or in any way
affecting, the subject matter of this agreement
are merged in and superseded by this agreement.
12.14 FURTHER ASSURANCE
Each party must promptly execute all documents and do all things
that another party from time to time reasonably requests to
effect, perfect or complete this agreement and all transactions
incidental to it.
12.15 SEVERANCE
Each of the agreements of the parties under this agreement is
severable from the others and the severance of one agreement does
not affect the other agreements.
12.16 GOVERNING LAW
This agreement is governed by and must be construed in accordance
with the laws of New South Wales.
12.17 JURISDICTION
Each party:
(a)irrevocably and unconditionally submits to the
non-exclusive jurisdiction of the courts of New South
Wales and all courts which have
<PAGE> 200
-15-
jurisdiction to hear appeals from those courts;
and
(b)waives any right to object to proceedings
being brought in those courts for any reason.
*****
<PAGE> 201
SCHEDULE A
(Properties)
<TABLE>
<CAPTION>
No. Name Address Title reference
<S> <C> <C> <C>
QUEENSLAND
PROPERTIES
13. Caloundra 4 Lyon Street, Caloundra, Qld 4551 2/177466
14. Nambour 9 Princess Crescent, Nambour, Qld 4560 2/183823
NSW
PROPERTIES
15. Annandale 76 Johnston Street, Annandale, NSW Auto-consol
2038 9867-46
16, Armon 42 Croydon Street, Petersham, NSW 1/110079
2049
17. Bathurst 61 Boyd Street, Kelso, NSW 2795 11/806355
18. Bossley Park 56 Quarry Street, Bossley Park, NSW 8/713734
2176
19. Canterbury 16-20 Albert Street, Campsie, NSW 2194 1/549851
20. Crest 11 Johnston Street, Annandale, NSW 1/913044 and
2038 1/913045
21. Dubbo 80 Muller Street, Dubbo, NSW 2830 12/592842
22. Fernleigh 8-14 Sherbrooke Road, West Ryde, 1/201757 and
NSW 2114 4/201757
23. Maitland 28 Broughton Street, Rutherford, NSW 5/733509
2320
24. Mudgee 207-213 Denison Street, Mudgee NSW 1/261314
2850
25. Murwillumbah Cnr North Arm Road and Ingram Place, 1/786640
Murwillumbah, NSW 2484
26. Narranderra 1A Chantilly Street, Narranderra, NSW 2/582847 and
2700 308/257212
</TABLE>
<PAGE> 202
-17-
<TABLE>
<CAPTION>
<C> <C> <C> <C>
27. Norah Head 63 Palomar Parade, Toukley, NSW 2263 721/26247 and
509/26247
28. Quakers Hill 35 Hambledon Road, Quakers Hill, 10/860042
NSW 2763
29. Shoalhaven 43 Brinawarr Street, Bomaderry, NSW 5/614886
2541
30. Stanmore 66 Cambridge Street, Stanmore, NSW 31/7/1
2048
VICTORIAN
PROPERTIES
31. Altona 33-38 Rymill Court, Altona North, Vol. 8741 Fol.
Victoria 3018 761, 771, 772
32. Meadow 82-116 Lightwood Crescent, Meadow Vol. 10342 Fol.
Heights Heights, Vic 3048 086
33. Mildura Cnr Ontario Avenue and Colonial Vol. 9892 Fol.
Drive, Mildura, Vic 3500 717, 719, 720
34. Warrnambool 170 Raglan Parade, Warrnambool, Vic Vol. 10346 Fol.
3280 571
35. Whittlesea 202-290 McDonalds Road, Epping, Vic Vol. 10390 Fol.
3076 104
WA
PROPERTIES
36. Applecross 30 Carron Road, Applecross, WA 6153 Vol. 1964 Fol.
640
37. Armadale 21 Angelo Street, Armadale, WA 6112 Vol. 1951 Fol.
(Hillview) 293
38. Bunbury 39 Hayes Street, Bunbury, WA 6230 Vol. 1534 Fol.
995
39. Geraldton 20 Milford Street, Geraldton, WA 6530 Vol. 1539 Fol.
329, Vol. 1890
Fol. 506
40. Kalgoorlie 6 Dugan Street, Kalgoorlie, WA 6430 Vol. 1597 Fol.
789
41. Murray River Cnr Coolibah and Boundary Roads, Vol. 1697 Fol.
Mandurah, WA 6210 190
</TABLE>
<PAGE> 203
-18-
<TABLE>
<CAPTION>
<C> <C> <C> <C>
42. Narrogin 52 Williams Road, Narrogin, WA 6312 Vol. 1634 Fol.
809
</TABLE>
<PAGE> 204
-19-
EXECUTED AS A DEED
Signed by the attorney of
PRINCIPAL HEALTHCARE FINANCE
PTY LIMITED under power of
attorney in the presence of:
. . . . . . . . . . . . . . . . . . . . . . . . . . . .. . . . . . . . . . . . .
Signature of witness Signature of attorney
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Name of witness (print) Name of attorney (print)
Executed by MORAN HEALTH CARE
(AUSTRALIA) PTY LIMITED by:
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Signature of authorised person Signature of authorised person
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Office held Office held
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Name of authorised person (print) Name of authorised person (print)
Executed by MORAN HEALTH CARE
GROUP PTY LIMITED by:
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Signature of authorised person Signature of authorised person
<PAGE> 205
-20-
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Office held Office held
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Name of authorised person (print) Name of authorised person (print)
Executed by PETER ANNA PTY LIMITED
by:
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Signature of authorised person Signature of authorised person
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Office held Office held
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Name of authorised person (print) Name of authorised person (print)
Executed by MORAN HEALTH CARE
GROUP (WA) PTy LIMITED by:
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Signature of authorised person Signature of authorised person
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Office held Office held
<PAGE> 206
-21-
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Name of authorised person (print) Name of authorised person (print)
<PAGE> 207
-22-
ANNEXURE A
(Plan of Altona Surplus Land)
<PAGE> 208
-23-
ANNEXURE B
(Plan of Meadow Heights Surplus Land)
<PAGE> 209
-24-
ANNEXURE C
(Plan of Nambour Surplus Land)
<PAGE> 210
-25-
ANNEXURE D
(Dubbo plan and section 88B instrument)
<PAGE> 211
RELATIONSHIP AGREEMENT
(Moran Phase 2)
PRINCIPAL HEALTHCARE FINANCE PTY LIMITED
MORAN HEALTH CARE (AUSTRALIA) PTY LIMITED
PETER ANNA PTY LIMITED
MORAN HEALTH CARE GROUP (WA) PTY LIMITED
MORAN HEALTH CARE GROUP PTY LIMITED
[PHILLIPS FOX LAWYERS LOGO]
255 Elizabeth Street Sydney NSW 2000 Australia
Tel +61 2 9286 8000 Fax +61 2 9283 4144 DX 107 SYDNEY
Email: [email protected]
WWW site: http://www.PhillipsFox.com.au
<PAGE> 212
CONTENTS
<TABLE>
<CAPTION>
<S> <C> <C>
1. DEFINITIONS ........................................................................................ 1
2. COMMITMENT FEE ..................................................................................... 3
3. EMPLOYEES .......................................................................................... 4
4. AGREEMENT TO SELL AND VICTORIAN ACQUISITION
AGREEMENT .......................................................................................... 4
5. SALE OF SURPLUS LAND ............................................................................... 4
5.1 Subdivision and transfer of Surplus Land .................................................... 4
5.2 Obligations of Moran ........................................................................ 5
5.3 Morans right to caveat ...................................................................... 5
6. DUBBO EASEMENT .................................................................................... 6
6.1 PHF to consent .............................................................................. 6
6.2 Obligations of Moran ........................................................................ 6
7. GUARANTEE AND INDEMNITY FROM THE COVENANTOR ........................................................ 6
7.1 Consideration to the Covenantor ............................................................. 6
7.2 Guarantee from the Covenantor ............................................................... 6
7.3 Indemnity ................................................................................... 7
7.4 Payment of money by the Covenantor .......................................................... 7
7.5 Acknowledgments by the Covenantor ........................................................... 7
8. DISPUTE RESOLUTION ................................................................................. 8
8.1 Resolution by chartered accountant .......................................................... 8
8.2 Chartered accountant to act as an expert ................................................... 8
8.3 Costs ....................................................................................... 8
9. WARRANTIES ......................................................................................... 8
10. CONFIDENTIALITY AND ANNOUNCEMENTS .................................................................. 9
10.1 Confidentiality ............................................................................. 9
10.2 Announcements ............................................................................... 9
11. NOTICES ............................................................................................ 9
11.1 Means of giving notices ..................................................................... 9
11.2 Specified address for service ............................................................... 9
11.3 Time notices are given ...................................................................... 10
11.4 Proof of giving notices by facsimile ........................................................ 10
11.5 Copies of notices ........................................................................... 10
12. MISCELLANEOUS ...................................................................................... 11
12.1 Presumptions of interpretation .............................................................. 11
12.2 Headings and table of contents .............................................................. 11
12.3 Joint and several ........................................................................... 11
12.4 Successors and assigns ...................................................................... 11
12.5 Business day ................................................................................ 12
12.6 References to and calculations of time ...................................................... 12
12.7 Legal costs ................................................................................. 12
</TABLE>
<PAGE> 213
<TABLE>
<S> <C> <C>
12.8 Stamp duty and other charges ................................................................ 12
12.9 Amendment ................................................................................... 12
12.10 Approvals and consent ....................................................................... 12
12.11 Assignment .................................................................................. 13
12.12 Counterparts ................................................................................ 13
12.13 Entire agreement ............................................................................ 13
12.14 Further assurance ........................................................................... 13
12.15 Severance ................................................................................... 13
12.16 Governing law ............................................................................... 13
12.17 Jurisdiction ................................................................................ 13
SCHEDULE A .................................................................................................... 14
</TABLE>
<PAGE> 214
================================================================================
LEASE GUARANTEE
[VIC]
MORAN HEALTH CARE GROUP PTY LIMITED
AND
PRINCIPAL HEALTHCARE FINANCE PTY LIMITED
================================================================================
255 Elizabeth Street Sydney NSW 2000 Australia
Tel +61 2 9286 8000 Fax +61 2 9283 4144 DX 107 SYDNEY
Email: [email protected] WWW site:
http://www.PhillipsFox.com.au
Ref:VAC:965155
<PAGE> 215
GUARANTEE PARTICULARS
DATE:
PARTIES:
GUARANTOR: MORAN HEALTH CARE GROUP PTY LIMITED
(ACN 008 585 242) of 13-15 Bridge
Street, Sydney
LESSOR: PRINCIPAL HEALTHCARE FINANCE PTY LIMITED
(ACN 069 875 476) c/- Phillips
Fox, 255 Elizabeth Street, Sydney
THE LEASE: The Lease dated the date of this
Guarantee to which the Lessor and the
Lessee are parties in respect of the
property short particulars of which are
set out in Appendix 2.
LESSEE: MORAN HEALTH CARE (AUSTRALIA) PTY
LIMITED (ACN 082 466 456) of 13-15
Bridge Street, Sydney
LETTER OF CREDIT: PERCENTAGE OF 50%
ANNUAL RENT
SUPPLEMENTAL LETTER OF CREDIT: 50%
PERCENTAGE OF ANNUAL RENT
TANGIBLE: NET WORTH THRESHOLD $65 million
LESSEE NOTICE DETAILS: 13 Bridge Street, Sydney NSW 2000
LESSOR NOTICE DETAILS: Principal Healthcare Finance Pty Limited
C/- Phillips Fox
255 Elizabeth Street
Sydney NSW 2000
with a copy to:
Omega Worldwide Inc
900 Victors Way
Suite 345
Ann Arbor MI 48108
USA
and to:
Omega (UK) Limited
145 Cannon Street
London EC4N 5BP
United Kingdom
<PAGE> 216
THIS LEASE GUARANTEE is made on the date stated in the Particulars BETWEEN the
parties specified in the Particulars:
RECITALS
A. The Guarantor is the beneficial owner of the entire share capital of
the Lessee.
B. The Lessee has entered into a conditional agreement for lease under
which it is anticipated that the property referred to in the Schedule
will be leased to the Lessee by the Lessor.
C. The Guarantor anticipates that the lease referred to above may be
supplemented by the addition of further properties.
D. As a material inducement to the Lessor to enter into the lease
referred to in recital B above, the Guarantor has agreed fully and
unconditionally to guarantee, both payment of sums due under such
lease and the performance of the covenants and conditions contained in
such lease on the part of the Lessee and to enter into the covenants
contained in this Guarantee including the personal covenant contained
in Clause 7.
AGREEMENT
1. DEFINITIONS AND INTERPRETATION
1.1 DEFINITIONS
1.1.1 In this Guarantee unless the context otherwise requires words and
expressions defined in this Clause or in the Particulars shall have the
respective meanings attributable to them:
"PHFT COMPANY" means the Lessor, Principal and any person who at any
time prior to, on or after the date of this Charge is a Related Body
Corporate of the Lessor or of Principal;
"BUSINESS DAY" means any day other than a Saturday, a Sunday,
Christmas Day, Boxing Day, Good Friday or a day which is a bank
holiday in New South Wales;
"COLLATERAL SECURITY DOCUMENTS" means any present or future guarantee,
indemnity, security, letter of credit, rent deposit or other document
or instrument which contains or evidences an obligation to pay,
discharge or be responsible, directly or indirectly, for the
Guaranteed Liabilities or any of them and any present or future
Security Interest which secures the Guaranteed Liabilities or any of
them;
"DAMAGES" means any amount payable as agreed compensation for the
termination of the Lease under the terms of the Lease;
"EFFECTIVE DATE" means the date of the Lease;
"ELIGIBLE BANK" means a bank in Australia the outstanding, unsecured,
unsubordinated and unguaranteed short term debt obligations of which
are for the time being rated A-1+ or higher by Standard & Poors
Corporation;
"GROUP COMPANY" means the Lessee, the Guarantor and any person who at
any time prior to, on or after the date of this Charge is a Related
Body Corporate of the Lessee or the Guarantor;
"GROUP LEASE" means the Lease and each other present or future lease:
(a) which is granted by a PHFT Company to a Group Company prior to, or on
after the date of this Charge;
<PAGE> 217
(b) otherwise in relation to which, at any time prior to, on or after the
date of this Charge, a PHFT Company is the landlord and a Group
Company is the tenant; or
(c) which the Lessor and the Guarantor otherwise have agreed or may agree
in writing shall be designated a Group Lease;
and includes the Lease dated 19 June 1998 between the Lessor and
the Lessee.
"GUARANTOR" means the party named as "Guarantor" in the
Particulars;
"GUARANTEED LIABILITIES" means the moneys, liabilities and
obligations (whether actual or contingent, present or future and
whether incurred as principal or as surety) which are at any
time guaranteed or the subject of an indemnity under this
Guarantee or which are expressed to be guaranteed or to be the
subject of an indemnity under this Guarantee;
"LEASE" means the lease short particulars of which are set out
in the Lease description contained in the Particulars and any
lease entered into pursuant to Clause 16;
"LEASED PROPERTY" means all that land and buildings demised by
the Lease as more particularly described in the Lease;
"LESSEE" means the company named as
"Lessee" in the Particulars;
"MANAGEMENT FEE" means fees paid to any person (not being an
officer, director or employee of the payer) for the management
of a registered nursing home/residential care facility and any
other health care related facility to a maximum amount of 4% of
the Lessee's gross revenue per annum (calculated in accordance
with General Standards).
"OVERDUE RATE" means on any date, a rate equal to 5 percentage
points above the average bid rate for bills (as defined in the
Bills of Exchange Act 1901 (Cwth)) which is displayed on the
page of the Reuters Monitor System designated "BBSY" but in no
event greater than the maximum rate then permitted by applicable
law;
"PARTICULARS" means the descriptions and terms appearing on the
preceding pages headed "Charge Particulars" (and which form part
of this Charge);
"PRINCIPAL" means the trust known as the "Principal Healthcare
Finance Trust" (formerly known as the "Assisted Living Unit
Trust") constituted by a deed of trust dated 11 August 1995
between Assisted Living (Holdings) Pty Limited (now named
Principal Healthcare Finance Pty Limited) as trustee and Metlife
Australia (Holdings) Pty Limited (now named Premier Care
Australia (Holdings) Pty Limited) and FAI Deposit Co Pty Limited
(now named First Mentor Group Pty Limited) as original unit
holders;
"RELATED BODY CORPORATE" has the same meaning as that given
under the Corporations Law;
"RELEVANT DOCUMENTS" means each of the Group Leases and each
agreement pursuant to which any Group Lease has been or may be
entered into and each deed, agreement or other document entered
into pursuant to any Group Lease or any such agreement;
<PAGE> 218
"RENT" means all amounts reserved as and payable as rent under
the terms of the Lease including, for the avoidance of doubt,
under all Supplemental Leases thereto;
"SECURITY INTEREST means any mortgage, charge, assignment,
pledge, lien, standard security, right of set-off,
hypothecation, encumbrance, priority or other security interest
(whether fixed or floating) including, without limitation, any
"hold-back" or "flawed asset" arrangement, any preferential
right, any retention of title, deferred purchase, leasing, sale
or purchase, sale and leaseback arrangement or trust agreement,
declaration of trust, trust arising by operation of law and any
option or agreement for any of the same or any arrangement which
has substantially the same commercial or substantive effect as
the creation of security;
"SUPERIOR LESSOR" means the holder of the immediate reversionary
interest in any lease from which the Lease is demised;
"SUPPLEMENTAL LEASE" means any lease or underlease entered prior
to on or after the date of this Guarantee supplemental to or
entered into pursuant to the Lease whether or not in respect of
the same property;
"TANGIBLE NET WORTH" means in relation to the Guarantor, the
consolidated net worth of the Guarantor and its Related Bodies
Corporate calculated in accordance with accounting principles
generally accepted in Australia but always excluding the amount
of any unamortised debt discount and expense, deferred charges,
deferred taxation recognised as an asset, goodwill, deferred
pre-opening costs, patents, trademarks, service names,
copyrights, other intellectual property rights, organisational
expenses, operating rights, any write-up of the value of
unrealised real estate assets and any revaluation reserve; and
"TANGIBLE NET WORTH THRESHOLD" means the amount referred to in
the description of the Tangible Net Worth Threshold contained in
the Particulars or such other amount as the Guarantor and the
Lessor may agree.
1.2 INTERPRETATION
1.2.1 In this Guarantee:
(a) clause headings are included for convenience only and do not affect
the construction of this Guarantee;
(b) words denoting the singular include the plural and vice versa; and
(c) words denoting one gender include each gender and all genders.
1.2.2 In this Guarantee, unless the context otherwise requires, references
to:
(a) persons include references to natural persons, firms, partnerships,
companies, corporations, associations, organisations and trusts (in
each case whether or not having a separate legal personality);
(b) documents, instruments and agreements (including this Guarantee and
any other Relevant Documents and any other document referred to in
this Guarantee and the other Relevant Documents) are references to
such documents, instruments and agreements as
<PAGE> 219
modified, amended, varied, supplemented or novated from time to time;
(c) the word "including" shall be construed as meaning "including without
limitation" and the words "other" and "otherwise" shall not be
construed eiusdem generis with any foregoing words where a wider
construction is possible;
(d) the "Lessor" includes references to its successors and successors in
title and assigns including any person deriving title under the Lessor
or in favour of whom the Lessor may assign, transfer, novate, dispose
of, grant any interest in or declare a trust in respect of the whole
or any part of the right, title, interest or benefit of the Lessor in,
to and under this Guarantee or the Group Leases or any of them;
(e) the Lessee and the Guarantor include reference to their successors
and, in the case of the Lessee, to its successors in title and assigns
in respect of the whole or any part of the Leased Property;
(f) Recitals, Clauses, the Schedule and the Appendix are references to the
recitals to, clauses of and the schedule and appendix to this
Guarantee;
(g) the "Lease" are to the same as it may from time to time (whether or
not with the consent of the Guarantor) be amended, modified, varied,
supplemented, novated, extended or renewed and include any
Supplemental Lease or other document supplemental to or entered into
pursuant to the Lease (whether or not with the consent of the
Guarantor) including, without limitation, any guarantee entered into
by the Lessee in relation to an assignment of the Lease;
(h) statutory provisions (where the context so admits and unless otherwise
expressly provided) are construed as references to those provisions as
respectively amended, consolidated, extended or re-enacted from time
to time, and to any orders, regulations, instruments or other
subordinate legislation made under the relevant statute;
(i) a time of day is a reference to Sydney time; and
(ii) words and expressions defined in the Lease but not expressly
defined in this Guarantee shall in this Guarantee, unless the
context otherwise requires, have the meaning ascribed to them in
the Lease.
1.2.3 The Schedule and Appendix to this Guarantee form part of this Guarantee.
2. GUARANTEE
2.1 The Guarantor hereby unconditionally and irrevocably:
(a) guarantees and covenants to the Lessor that the Lessee will duly and
promptly pay all Rent and all other sums or amounts of whatsoever
nature which may now or at any time hereafter be or become payable by
the Lessee under the Lease (subject to such waivers and extensions as
may be agreed from time to time in the absolute discretion of the
Lessor);
(b) guarantees and covenants to the Lessor that the Lessee will duly and
promptly perform when due (subject to such waivers and extensions as
may be agreed from time to time
<PAGE> 220
in the absolute discretion of the Lessor) each and every one of the
terms, conditions and covenants to be observed and performed by the
Lessee under the Lease, and including all indemnification obligations,
repurchase obligations, insurance obligations, all obligations to
operate, rebuild, restore or replace any facilities or improvements
now or hereafter located on the Leased Property and the obligations of
the Lessee to pay any amounts of Damages. The Guarantor hereby further
unconditionally and irrevocably undertakes to the Lessor that in the
event of the failure of the Lessee to pay any such Rent or any such
other sums or amounts payable by the Lessee or to render any such
other performance required of the Lessee under the Lease when due, the
Guarantor shall forthwith on demand pay such Rent or such other
provisions of the Lease to be performed by the Lessee thereunder. As a
separate and independent obligation the Guarantor further undertakes
that it will on demand indemnify the Lessor on a full and unqualified
indemnity basis against, and keep indemnified the Lessor against all
actions, claims, costs, demands, expenses, liabilities, losses and
damages incurred by the Lessor as a result of the non-payment or
non-performance by the Lessee of its obligations to pay such Rent or
such other sums or amounts or to perform any such other provision of
the Lease to the full extent provided under the Lease.
2.2 This Guarantee is a continuing security and shall remain in full force
and effect until the Guaranteed Liabilities have been paid, discharged
or satisfied in full notwithstanding any incapacity of or any change in
the name or style of the Lessor, the Lessee or the Guarantor or any
settlement of account or any other matter whatsoever.
3. SURVIVAL OF OBLIGATIONS
3.1 The obligations of the Guarantor under this Guarantee shall not in any
way be released, determined, discharged, reduced or affected by, and
they shall survive and continue in full force and effect notwithstanding
the occurrence of, any of the following or any combination of the
following:
(a) any amendment, modification or extension of, or supplement to, the
Lease (and any review of the Rent or other increase in the Rent);
(b) any compromise, release, consent, extension, indulgence, concession or
other action or inaction in respect of any terms of the Lease or any
Collateral Security Document;
(c) any substitution or release, in whole or in part, of any security for
this Guarantee which the Lessor may hold at any time or for any other
Collateral Security Document;
(d) any neglect, delay or forbearance in the exercise or non-exercise by
the Lessor of any right, power or remedy under or in respect of the
Lease or under or in respect of any Collateral Security Document or
this Guarantee or of any waiver of any such right, power or remedy;
(e) any bankruptcy, insolvency, reorganisation, arrangement, scheme,
composition, liquidation, administration, dissolution, receivership,
winding-up, striking-off, the entry into a trust deed for the benefit
of creditors and the execution of any distress or diligence against of
the Lessor, the Guarantor, the Lessor or any other person liable under
any Collateral Security Document or any of their assets or any similar
or analogous event or circumstance, or any change in the constitution,
structure or powers of the same;
<PAGE> 221
(f) any limitation of the Lessee's or the Guarantor's liability which may
now or hereafter be imposed by any statute, regulation or rule of law,
or any illegality, irregularity, invalidity or unenforceability, in
whole or in part, of the Lease or any term thereof;
(g) any sale, lease, surrender or transfer of all or any part of the
Leased Property or all or any of the assets of the Lessee to any other
person, firm or entity;
(h) any act or omission by the Lessor with respect to any of the
Collateral Security Documents or this Guarantee or any failure to
file, record or otherwise perfect any of the same;
(i) any extensions of time for performance under the Lease or any
Collateral Security Document, whether before or after cessation or
maturity;
(j) the release of any collateral lien or the release of the Lessee from
the performance or observation of any of the agreements, covenants,
terms or conditions contained in the Lease by operation of law or
otherwise;
(k) the fact that the Lessee or any other person may or may not be
personally liable, in whole or in part, under the terms of any Lease
or any Collateral Security Document to pay any money judgment or other
amount;
(l) the failure to give the Guarantor any notice of acceptance, default or
otherwise;
(m) the existence or otherwise of any other Collateral Security Document
now or hereafter executed by the Guarantor or anyone else in
connection with the Lease;
(n) any rights, powers or privileges the Lessor may now or hereafter have
against any other person, entity or collateral;
(o) the fact that the Lessee or any person liable under any Collateral
Security Document shall be dissolved or cease to exist or the Lease is
terminated in accordance with the provisions therein contained; or
(p) any other act, omission, matter or thing whatsoever whereby but for
this provision the Guarantor would be exonerated or released either
wholly or in part.
4. PRIMARY LIABILITY
4.1 As a separate and independent obligation, the liability of the Guarantor
hereunder to the Lessor shall be primary, direct and immediate, and the
Guarantor is jointly and severally liable with the Lessee and any other
person liable under a Collateral Security Document for the fulfilment of
all the obligations of the Lessee under the Lease and the Lessor may
proceed against the Guarantor:
(a) before or in lieu of proceeding against the Lessee or any other person
liable under a Collateral Security Document or the assets of any such
person or any security deposit or letter of credit; and/or
(b) before or in lieu of pursuing any other rights or remedies available
to the Lessor for any reason whatsoever and/or even if the obligations
of the Lessee under the Lease or of any
<PAGE> 222
other person are not enforceable. All rights and remedies afforded to
the Lessor by reason of this Guarantee or any other Collateral
Security Document or by law are separate, independent and cumulative,
and the exercise of any rights or remedies and the Lessor may exercise
its rights and remedies as often as the Lessor thinks appropriate.
4.2 The Lessor shall not be obliged to make any demand on the Lessee or any
other person before enforcing its rights against the Guarantor and in
the event of any default under the Lease, a separate action or actions
may be brought and prosecuted against the Guarantor whether or not the
Lessee or any other person is joined therein or a separate action or
actions are brought against the Lessee or any other person. The Lessor
may maintain successive actions for other defaults. The Lessor's rights
hereunder shall not be exhausted by its exercise of any of its rights or
remedies or by any such action or by any number of successive actions
until and unless all indebtedness and obligations the payment and
performance of which are hereby guaranteed have been unconditionally and
irrevocably paid and fully performed and the Lessee shall have no
further actual or contingent liability to the Lessor under the Lease.
5. OBLIGATIONS NOT AFFECTED
5.1 In such manner, upon such terms and at such times as the Lessor in its
sole discretion deems necessary or expedient and without notice to the
Guarantor, the Lessor may:
(a) amend, alter, compromise accelerate, extend or change the time or
manner for the payment or the performance of any Guaranteed
Liabilities or the liability of the Guarantor hereunder;
(b) extend, amend or terminate the Lease, this Guarantee or any Collateral
Security Document; or
(c) take or omit to take any action which would or might result in the
occurrence of any of the events or circumstances described in Clause3.
No exercise or non-exercise by the Lessor of any right hereby given to
the Lessor, dealing by the Lessor with the Lessee or any other person
liable under any Collateral Security Document, nor any change,
impairment, release or suspension of any right or remedy of the Lessor
against any person including the Lessee will affect any of the
liabilities or obligations of the Guarantor hereunder or give the
Guarantor any recourse or offset against the Lessor.
5.2 Without prejudice to any other protection afforded to the Lessor under
this Guarantee, the Guarantor shall on demand enter into any deed or
document supplemental to the Lease (including without limitation any
Supplementary Lease) for the purpose of acknowledging that the
Guarantor's liabilities and obligations hereunder will continue in full
force and effect notwithstanding the entering into or execution of such
supplemental deed or document and will apply to the terms of any such
supplemental deed or document once the same has been entered into.
60 WAIVER
6.1 The Guarantor hereby irrevocably and unconditionally waives and
relinquishes all rights and remedies accorded by applicable law to
sureties and/or guarantors or any other
<PAGE> 223
accommodation parties, under any statutory provisions, common law or
any other provision of law, custom or practice, and agrees not to
assert or take advantage of any such rights or remedies including, but
not limited to:
(a) any right to require the Lessor to proceed against the Lessee or any
other person or to proceed against or exhaust any security or
Collateral Security Document held by the Lessor at any time or to
pursue any other remedy in the Lessor's power before proceeding
against the Guarantor or to proceed against the Lessee and/or any
collateral, including collateral, if any, given to secure the
Guarantor's obligation held by the Lessor at any time or in any
particular order;
(b) any defence including, without limitation, estoppel that may arise by
reason of the incapacity or lack of authority of any other person or
persons;
(c) notice of the existence, creation or incurring of any new or
additional indebtedness or obligation or of any action or non-action
on the part of the Lessee, the Lessor, any creditor of any Lessee or
the Guarantor or on the part of any other person whomsoever under this
or any other document or instrument in connection with any obligation
or evidence of indebtedness held by the Guarantor or in connection
with any obligation hereby guaranteed;
(d) any defence based upon an election of remedies by the Lessor which
destroys or otherwise impairs the subrogation rights of the Guarantor
or the right of the Guarantor to proceed against the Lessee for
reimbursement, or both;
(e) any defence based upon any statute or rule of law which provides that
the obligation of a surety must be neither larger in amount or in
other respects more burdensome than that of the principal; and
(f) any duty on the part of the Lessor to disclose to the Guarantor any
facts the Lessor may now or hereafter know about the Lessee,
regardless of whether the Lessor has reason to believe that any such
facts materially increase the risk beyond that which the Guarantor
intends to assume or has reason to believe that such facts are unknown
to the Guarantor or has a reasonable opportunity to communicate such
facts to the Guarantor, it being understood and agreed that the
Guarantor is fully responsible for being and keeping informed of the
financial condition of the Lessee and of all circumstances bearing on
the risk of non-payment or non-performance of the Guaranteed
Liabilities.
70 WARRANTIES AND PERSONAL COVENANT
7.1 In order to induce the Lessor to enter into the Lease, the Guarantor
warrants that:
(a) this Guarantee is executed by the Guarantor at the Lessee's request;
and
(b) the Guarantor has established adequate means of obtaining from the
Lessee on a continuing basis financial information. The Guarantor
agrees to keep adequately informed from such means of any facts,
events or circumstances which might in any way affect the Guarantor
risk hereunder and the Guarantor further agrees that the Lessor shall
have no obligation to disclose to the Guarantor information or
material acquired in the course of the Lessor's relationship with the
Lessee. The Guarantor
<PAGE> 224
further represents and warrants that:
(i) the Guarantor has full power to enter into and perform and
observe its obligations and covenants hereunder and has taken
all necessary corporate and other action required to authorise
its execution of this Guarantee and the provisions of this
Guarantee constitute the legal, valid and binding obligations of
the Guarantor;
(ii) the Guarantor is duly incorporated and has full power (so far as
is material to this Guarantee) to carry on its business as
conducted at the date it becomes a party to this Guarantee and
to own its property and other assets and to enter into and
perform and observe its obligations under this Guarantee and it
has obtained and will maintain in full force and effect all
necessary consents, licences and authorities and no limitation
on its powers to borrow or give guarantees will be executed as a
result of this Guarantee;
(iii) the creation of this Guarantee and the performance and
observance of the obligations and covenants hereunder does not
and will not-
- contravene any existing applicable law, statute, rule
or regulation or any judgment, decree or permit to
which the Guarantor is subject;
- conflict with or result in any breach of any of the
terms of or constitute a default under any agreement
or other instrument to which it is a party or is
subject or by which it or any of its property is
bound;
- contravene or conflict with any provision of its
constitutional documents; or
- result in the creation or imposition of or oblige it
to create any charge or other encumbrance on any of
its assets, rights or revenues;
(iv) neither the Guarantor nor any of its Related Bodies Corporate is
in default in respect of any financial commitment or obligation
including any guarantee, indemnity, bond or like obligation or
in breach of any agreement or arrangement or statutory or other
legal requirements;
(v) save for any such matters arising in the ordinary and normal
course of business, neither the Guarantee nor any of its Related
Bodies Corporate is involved in any action, suit, arbitration or
proceeding nor is any such action, suit, arbitration or
proceeding pending or threatened;
(vi) it is not necessary to ensure the legality, validity,
enforceability or admissibility in evidence of this Guarantee
that it or any other document be stamped, registered, filed,
notarised, recorded or enrolled in New South Wales or any other
jurisdiction and this Guarantee is in proper form for its
enforcement in Australia and any other applicable jurisdiction;
and
(vii) no taxes, levies, imposts or duties of whatever nature are
imposed under the laws of New South Wales or the Commonwealth or
any other jurisdiction on or by virtue of the execution or
delivery by the Guarantor of this Guarantee.
<PAGE> 225
80 NO SUBROGATION
8.1 Until all obligations of the Lessee under the Lease and each of the
other Group Leases have been unconditionally and irrevocably paid and
fully performed and the Lessee shall have no further actual or
contingent liability to the Lessor whether under the Lease or the other
Group Leases, the Guarantor shall have no right of subrogation and the
Guarantor waives any right to enforce any remedy which the Lessor now
has or may hereafter have against the Lessee and any benefit of, and any
right to participate in, any security now or hereafter held by the
Lessor with respect to the Lease or the other Group Leases.
90 POSTPONEMENT
9.1 Until all of the Guaranteed Liabilities and all other moneys,
liabilities and obligations (whether present or future, whether actual
or contingent and whether as principal or surety) due or owing by the
Lessee to the Lessor have been unconditionally and irrevocably satisfied
and discharged in full the Guarantor undertakes to the Lessor that:
(a) it shall not claim or have the benefit of any security, guarantee or
indemnity from the Lessee now or hereafter held by the Lessor in
respect of the Guaranteed Liabilities or such other moneys,
liabilities and obligations or the liabilities of the Lessee or any
other person under any other Collateral Security Document;
(b) it shall not claim in competition with the Lessor in any liquidation,
bankruptcy, administration, arrangement, scheme or composition with
creditors of or concerning the Lessee unless required to do so by the
Lessor;
(c) it will pay (to the extent of the aggregate amount of the Guarantor's
liabilities hereunder) to the Lessor an amount equal to all moneys the
Guarantee shall receive by way of proceeds of any judgment or any
distribution from any liquidator, trustee in bankruptcy, receiver or
administrator of the Lessee; and
(d) the Guarantor shall hold in trust (to the extent of the aggregate
amount of the Guarantor's liabilities hereunder) for the benefit of
the Lessor all security rights the Guarantor may have from time to
time over the assets of any Lessee.
100 NO DELAY
10.1 Any payments required to be made by the Guarantor hereunder shall become
due on demand validly made by the Lessor in accordance with the terms
hereof. The Guarantor expressly unconditionally and irrevocably waives
and relinquishes all rights and remedies accorded by applicable law to
guarantors, including without limitation, any extension of time
conferred by any law now or hereafter in effect and any requirement or
notice of acceptance of this Guarantee or any other notice to which such
Guarantor may now or hereafter be entitled to the extent such waiver of
notice is permitted by applicable law.
110 APPLICATION OF PAYMENTS
11.1 With or without notice to the Guarantor, the Lessor, in its sole
discretion and at any time
<PAGE> 226
from time to time and in such manner and upon such terms as the Lessor
deems appropriate, may apply any or all payments or recoveries from the
Lessee or from any other person under any other instrument or realised
from any security, in such manner and order of priority as the Lessor
may determine, to any indebtedness, liability or obligation of Lessee
with respect to the Lease, whether or not such indebtedness, liability
or other obligation is guaranteed hereby or is otherwise secured or is
due at the time of such application.
11.2 Any payment or recovery in respect of the Guaranteed Liabilities from
the Guarantor or any amount received or recovered by the Lessor pursuant
to Clauses9 or 10 may be placed in an account of the Lessor with an
Australian trading bank (referred to in this sub-clause as a "suspense
account") (instead of being applied immediately against the Guaranteed
Liabilities) with a view to preserving the right of the Lessor to prove
for the whole of its claim against the Lessee, the Guarantor or other
person and the credit balance on such suspense account may be applied at
such time as the Lessor shall choose and from time to time in the same
way as such payments or recoveries. This sub-clause shall not operate to
create a trust over the suspense account or any money standing to the
credit of the suspense account.
11.3 If during any period there is a credit balance on a suspense account
then the liability of the Guarantor to pay interest on the Guaranteed
Liabilities in respect of such period shall be reduced to an amount
equal to the amount of interest which would have been payable by the
Guarantor on the Guaranteed Liabilities in respect of such period had
the Lessor, upon receipt hereunder of any money credited to a suspense
account, instead applied such money in or towards discharge of the
Guaranteed Liabilities in accordance with the documents providing for
the same and this Guarantee.
11.4 If at any time the credit balance of the suspense account exceeds the
amount of the Guaranteed Liabilities and the Lessor is under no
liability or obligation which may give rise to any further liabilities
hereunder then the Lessor shall pay the amount of such excess to the
Guarantor on demand.
120 GUARANTEE DEFAULT
12.1 As used herein, the term "Guarantee Default" shall mean one or both of
the following events:
(a) the failure of the Guarantor to pay any amount required to be paid by
it hereunder when due; and/or
(b) the failure of the Guarantor diligently and without delay to observe
and perform any covenants, condition or agreement on its part to be
observed or performed, pursuant to this Guarantee other than as
referred to in sub-clause(a) above.
12.2 Upon the occurrence of a Guarantee Default, the Lessor shall have the
right to bring such actions at law or in equity, including appropriate
injunctive relief, as it deems appropriate to compel compliance, payment
or deposit, and among other remedies to recover its legal fees in any
proceeding, including any appeal therefrom and any post-judgment
proceedings.
12.3 The Guarantor agrees to pay interest on each amount properly demanded of
it under this
<PAGE> 227
Guarantee from the date of such demand until payment at the Overdue
Rate both before and after judgment. Such interest shall accrue daily
and shall be compounded in the event of it not being punctually paid
with quarterly rests but without prejudice to the Lessor's right to
require payment of such interest when due.
130 LETTER OF CREDIT
13.1 In this Clause13, "LC" is the figure specified in the term "Letter of
Credit: Percentage of Annual Rent" contained in the Particulars. For the
avoidance of doubt, in calculating the amount of any Letters of Credit,
"LC" is read as a figure rather than a percentage (so that if "Letter of
Credit: Percentage of Annual Rent" is specified in the Particulars as
50per cent, LC is read as "50" and not as "one half").
13.2 If "Letter of Credit: Percentage of Annual Rent" is specified as "zero"
or "not applicable" in the Particulars then this clause13 shall not
apply to this Guarantee. If "Letter of Credit: Percentage of Annual
Rent" is not specified in the Particulars then this Clause13 shall apply
to this Guarantee and LC shall be read as "50".
13.3 On the commencement date of the Lease, the Guarantor shall deliver to
the Lessee as further security for the Guaranteed Liabilities a letter
of credit (the "Letter of Credit", which expression shall include any
amendment thereto or any amended or substituted Letter of Credit
delivered pursuant to sub-clause 13.4) issued by a bank which is an
Eligible Bank in favour of the Guarantor in the form contained in the
Appendix to this Guarantee in a principal amount equal to the amount
which is LC per cent of the initial annual Rent under the Lease with an
expiration date not less than one year after the date on which such
Letter of Credit is delivered.
13.4 Without prejudice to sub-clause 13.5, if and whenever the Rent payable
under the Lease shall before the expiration of the Letter of Credit or
Replacement Letter of Credit, be increased (including by reason of the
execution of any Supplemental Lease), the Guarantor shall on or prior to
the effective date of such increase (the "Rent Increase Date"), deliver
to the Lessor as further security for the Guaranteed Liabilities, an
amendment to the Letter of Credit or Replacement Letter of Credit issued
by a bank which is for the time being an Eligible Bank that has the
effect of increasing the principal amount of the Letter of Credit or
Replacement Letter of Credit to an amount equal to the amount which is
LC per cent of such increased annual Rent.
13.5 Without prejudice to sub-clause13.4, not less than 30days before the
expiration of the Letter of Credit or any Replacement Letter of Credit,
the Guarantor will deliver to the Lessor a replacement letter of credit
("Replacement Letter of Credit") issued by a bank which is for the time
being an Eligible Bank. The Replacement Letter of Credit shall be in the
form contained in the Appendix to this Guarantee and shall be in a
principal amount equal to LC per cent of the annual Rent payable under
the Lease as at the date on which the Replacement Letter of Credit is
delivered and shall have an expiration date not less than one year after
the date on which the Replacement Letter of Credit is delivered. If a
Replacement Letter of Credit is not delivered to the Issuer by the date
which is 30 days before the expiration date of the Letter of Credit or
previous Replacement Letter of Credit pursuant to this sub-clause13.5 or
an amendment to a Letter of Credit or Replacement Letter of Credit is
not delivered to the Lessor on or prior to the Rent Increase Date
pursuant
<PAGE> 228
to sub-clause 13.4, then the Guarantor agrees that the Lessor shall be
entitled to draw under the Letter of Credit the full outstanding balance
of the principal amount thereof.
13.6 All sums drawn by the Lessor pursuant to sub-clause 13.5 shall be
deposited by the Lessor in an interest-bearing account at an Australian
trading bank and the credit balance on the account (together with the
interest accruing thereon) may be applied at any time from time to time in
the same way as payments and recoveries under this Guarantee as provided
by Clause 11.
13.7 The foregoing provisions of this Clause shall apply (mutatis mutandis) to
any Replacement Letter of Credit as they do to the Letter of Credit.
13.8 The Guarantor agrees that the Lessor shall be entitled to make one or more
drawings under the Letter of Credit or any Replacement Letter of Credit at
any time or times after any of the Guaranteed Liabilities have not been
paid on the due date therefor in accordance with the terms of the Lease.
13.9 Any sum or sums recovered by the Lessor under the Letter of Credit or any
Replacement Letter of Credit (other than sums deposited in a bank account
in accordance with sub-clause 13.6) and any sums withdrawn by the Lessor
from such account shall be applied in the same way as payments and
recoveries under this Guarantee as provided by Clause 11.
140 SUPPLEMENTAL LETTER OF CREDIT
14.1 In this clause 14, "SLC" is the figure specified in the term "Supplemental
Letter of Credit: Percentage of Annual Rent" contained in the Particulars.
For the avoidance of doubt, in calculating the amount of any Supplemental
Letters of Credit, "SLC" is read as a figure rather than a percentage (so
that if "Supplemental Letter of Credit: Percentage of Annual Rent" is
specified in the Particulars as 50 percent, SLC is read as "50" and not
as "one half").
14.2 If "Supplemental Letter of Credit: Percentage of Annual Rent" is specified
as "zero" or "not applicable" in the Particulars then this Clause 14 shall
not apply to this Guarantee. If "Supplemental Letter of Credit: Percentage
of Annual Rent" is not specified in the Particulars then this Clause 14
shall apply to this Guarantee and SLC shall be read as "50".
14.3 If at any time and from time to time the Tangible Net Worth of the
Guarantor shall fall below the amount of the Tangible Net Worth Threshold
on or after the Effective Date, the Guarantor undertakes within 7 days to
deliver to the Lessor, in addition to the Letter of Credit or any
Replacement Letter of Credit, a letter of credit (the "Supplemental Letter
of Credit", which expression shall include any amendment thereto or any
amended or substituted Supplemental Letter of Credit therefor delivered
pursuant to sub-clause 14.4) issued by a bank which is for the time being
an Eligible Bank in the form contained in the Appendix to this Guarantee
in a principal amount equal to the amount which is SLC per cent of the
annual Rent under the Lease at the date at which such Supplemental Letter
of Credit is delivered and with an expiration date not less than one year
after the date on which such Supplemental Letter of Credit is delivered.
14.4 Without prejudice to sub-clause 14.5, if and whenever prior to the
expiration of a Supplemental Letter of Credit or any Replacement
Supplemental Letter of Credit (as
<PAGE> 229
defined below), the annual Rent payable under the Lease shall be increased
(including by reason of the execution of any Supplemental Lease) the
Guarantor shall on or prior to the effective date of such increase (the
"Rent Increase Date"), deliver to the Lessor as further security for the
Guaranteed Liabilities, an amendment to the Supplemental Letter of Credit
or Replacement Supplemental Letter of Credit issued by a bank which is for
the time being an Eligible Bank that has the effect of increasing the
principal amount of the Supplemental Letter of Credit or Replacement
Supplemental Letter of Credit to an amount equal to SLC per cent of such
increased annual Rent.
14.5 Without prejudice to sub-clause 14.4, not less than thirty(30) days prior
to the expiration of the Supplemental Letter of Credit or any Replacement
Supplemental Letter of Credit, the Guarantor will deliver to the Lessor a
replacement supplemental letter of credit ("Replacement Supplemental
Letter of Credit") issued by a bank which is for the time being an
Eligible Bank unless the Tangible Net Worth of the Guarantor as at the day
thirty(30) days prior to the expiration of the Supplemental Letter of
Credit or Replacement Supplemental Letter of Credit exceeds the amount of
the Tangible Net Worth Threshold. The Replacement Supplemental Letter of
Credit shall be in the form contained in the Appendix to this Guarantee
and shall be in a principal amount equal to SLC per cent of the annual
Rent under the Lease as at the date at which the Replacement Supplemental
Letter of Credit is delivered and shall have an expiration date not less
than one year after the date on which the Replacement Supplemental Letter
of Credit is delivered. If a Replacement Supplemental Letter of Credit or
Replacement Supplemental Letter of Credit is not delivered to the Lessor
by the date which is thirty(30) days prior to the expiration date of the
Supplemental Letter of Credit or previous Replacement Supplemental Letter
pursuant to this sub-clause 14.5 (other than by reason of the Tangible Net
Worth of the Guarantor exceeding the amount of the Tangible Net Worth
Threshold) or an amendment to a Supplemental Letter of Credit or
Replacement Supplemental Letter of Credit is not delivered to the Lessor
on or prior to the Rent Increase Date pursuant to sub-clause 14.4, then
the Letter of Credit Guarantor agrees that the Lessor shall be entitled to
draw under the Supplemental Letter of Credit or Replacement Supplemental
Letter of Credit the full outstanding balance of the principal amount
thereof. If the Guarantor does not deliver a Replacement Supplemental
Letter of Credit by reason of the Tangible Net Worth of the Guarantor
exceeding the amount of the Tangible Net Worth Threshold, and subsequently
the Tangible Net Worth of the Guarantor falls below the amount of the
Tangible Net Worth Threshold, the Guarantor shall for the avoidance of
doubt deliver a further Supplemental Letter of Credit in accordance with
Clause 14.3.
14.6 All sums drawn by the Lessor pursuant to sub-clause 14.5 above shall be
deposited by the Lessor in an account at an Australian trading bank and
the credit balance on the account (together with any interest accruing
thereon) may be applied at any time and from time to time in the same way
as payments and recoveries under this Guarantee as provided by Clause 11.
14.7 The foregoing provisions of this Clause 14 shall apply (mutatis mutandis)
to any Replacement Supplemental Letter of Credit as they do to the
Supplemental Letter of Credit.
14.8 The Guarantor agrees that the Lessor shall be entitled to make one or more
drawings under the Supplemental Letter of Credit or any Replacement
Supplemental Letter of Credit at any
<PAGE> 230
time or times to the extent that any of the Guaranteed Liabilities have
not been paid and performed on the due date therefor in accordance with
the terms of the Lease.
14.9 Any sum or sums recovered by the Lessor under the Supplemental Letter of
Credit or any Replacement Supplemental Letter of Credit (other than sums
deposited in a bank account in accordance with sub-clause 14.6) and any
sums withdrawn by the Lessor from such account shall be applied in the
same way as payments and recoveries under this Guarantee as provided by
Clause 11.
14.10 If at any time and from time to time after the Guarantor has provided the
Supplemental Letter of Credit to the Lessor, the Tangible Net Worth of the
Guarantor rises above the amount of the Tangible Net Worth Threshold and
constantly remains above that amount for a period of 6 months or more, the
Lessor must return the Supplemental Letter of Credit to the Guarantor. If
at any time and from time to time the Tangible Net Worth of the Guarantor
subsequently falls below the amount of the Tangible Net Worth Threshold,
the Guarantor undertakes within 7 days to deliver to the Lessor a new
Supplemental Letter of Credit in accordance with clause 14.3 and the
remaining provisions of this clause 14 shall apply.
150 FINANCIAL STATEMENTS
15.1 The Guarantor undertakes to deliver to the Lessor:
(a) within 140 days after the end of each of its financial years, the
audited financial statements of the Guarantor; and
(b) within 10 days after the mailing thereof (or the delivery thereof in
the case of any materials not mailed), any and all notices, circulars
or other materials provided by the Guarantor to its shareholders
generally.
160 OBLIGATION OF THE GUARANTOR TO ENTER INTO A NEW LEASE
16.1 If so required by the Lessor by written notice to the Guarantor at any
time after an Event of Default under the Lease, the Guarantor agrees that:
(a) it will take from the Lessor a grant of a lease of the Leased Property
under the Lease for the residue of the term of years granted by the
Lease unexpired at the date of such Event of Default at the same
yearly rents reserved by the Lease and subject to the like covenants,
provisos and conditions in all respects (including the proviso for
re-entry and any obligation to enter into a new lease) as are
contained in the Lease (but so that the times at which:
(i) the yearly rent is to be revised; and
(ii) the Leased Property is to be decorated further shall be the same
times respectively as are specified in the Lease); and
(b) on the execution of any such further lease it shall execute and
deliver to the Lessor a counterpart thereof and a fixed and floating
charge in the form of a limited charge executed by the Lessee
incorporating a legal charge over the Leased Property, the
<PAGE> 231
Approvals and the Lessee's Personal Property subject to such
modifications as the Lessor considers necessary or appropriate.
170 PAYMENTS
17.1 All sums payable by the Guarantor under this Guarantee shall be paid to
the Lessor as it may from time to time direct in full free of any present
or future taxes, levies, imposts, duties, charges, fees or withholdings
and without set-off or counterclaim or any restriction, condition or
deduction whatsoever. If the Guarantor is compelled by law to make any
deduction or withholding the Guarantor undertakes to promptly pay to the
Lessor such additional amount as will result in the net amount received by
the Lessor being equal to the full amount which would have been receivable
had there been no deduction or withholding. Any additional amount paid
under this sub-clause 17.1 shall not be treated as interest but as agreed
compensation.
17.2 If required to do so by the Lessor, the Guarantor undertakes to pay any
amount properly demanded hereunder to a collection agent in Australia
appointed by the Lessor for that purpose.
17.3 Payments made under this Guarantee shall be made in Australian dollars and
no liability of the Guarantor under this Guarantee shall be satisfied
unless and until the Lessor shall have received the dollars amount thereof
in full. If the Lessor receives any payment or recovery pursuant to this
Guarantee in a currency other than Australian dollars, the Lessor shall be
entitled (but not obliged) at any time to convert such payment or recovery
into Australian dollars and shall incur no liability to the Guarantor in
so doing. If for the purposes of any proceedings or filing or making any
claim hereunder (whether in the insolvency of the Guarantor or otherwise)
the Lessor is required to express any amount in any currency other than
Australian dollars then the Lessor may express such amount calculated at
such exchange rate as shall be notified to the Lessor by its bankers for
the time being as the rate at which such bankers will buy such currency
for Australian dollars and the Guarantor undertakes in relation to any
amounts claimed from it, as a separate and independent cause of action, to
indemnify the Lessor from any loss caused to the Lessor arising from any
subsequent fluctuation in exchange rates prior to receipt by the Lessor of
the amount claimed.
180 INDEMNITY
18.1 The Guarantor hereby agrees on demand to indemnify the Lessor on a full
and unqualified indemnity basis against all losses, actions, claims,
costs, charges, expenses and liabilities (together with any value added
tax thereon) incurred or sustained by the Lessor:
(a) in relation to the enforcement of this Guarantee or occasioned by any
breach by the Guarantor of any of its covenants or obligations to the
Lessor under this Guarantee;
(b) arising by reason of or in connection with any lack of capacity or
lack of authority on the part of the Lessee in entering into the
Lease; or
(c) arising by reason of or in connection with any lack of capacity or
authority on the part of the Guarantor in entering into this Guarantee
or the Lease or this Guarantee not
<PAGE> 232
taking effect in accordance with their terms for any reason.
190 SET-OFF
19.1 In addition to any general lien or similar right to which it might be
entitled by operation of law, the Lessor shall have the right (but not the
obligation) at any time after the occurrence of any Event of Default and
without notice to the Guarantor (both before and after making any demand
hereunder) to set-off any moneys, liability or obligation of the Lessor to
the Guarantor whether for the time being present or future and whether for
the time being actual or contingent in or towards satisfaction of the
liability of the Guarantor to the Lessor hereunder whether for the time
being present or future and whether for the time being actual or
contingent.
200 MISCELLANEOUS
20.1 No term, condition or provision of this Guarantee may be waived except by
an express written instrument to the effect signed by the waiving party.
No waiver of any term, condition or provision of this Guarantee will be
deemed a waiver of any other term, condition or provision of this
Guarantee or any other document (including without limitation or
Collateral Security Document), irrespective of similarity or constitute a
continuing waiver of the same term, condition or provision, unless
otherwise expressly provided.
20.2 If any one or more of the terms, conditions or provisions contained in
this Guarantee is found in a final award or judgment rendered by any court
of competent jurisdiction to be invalid, illegal or unenforceable in any
respect as against the Guarantor, the validity, legality and
enforceability of the remaining terms, conditions and provisions of this
Guarantee shall not in any jurisdiction in any way be affected or impaired
thereby, and this Guarantee shall be interpreted and construed as if the
invalid, illegal or unenforceable term, condition or provision had never
been contained in this Guarantee.
20.3 This Guarantee shall be governed by, and construed in accordance with, the
laws of New South Wales except where state specific legislation applies in
which case the governing law will be the law of that particular state.
20.4 Any legal action or proceedings arising out of or in connection with this
Guarantee may be brought in the Courts of New South Wales and the parties
irrevocably and unconditionally submit to the jurisdiction of such Courts.
The submission to such jurisdiction shall not (and shall not be construed
so as to) limit the right of any party to take proceedings in whatsoever
jurisdictions it thinks fit, nor shall the taking of proceedings in any
one or more jurisdictions preclude the taking of proceedings in any other
jurisdiction, whether concurrently or not.
20.5 Any release, discharge or settlement between the Guarantor and the Lessor
shall be conditional upon no security, disposition or payment to the
Lessor by the Lessee or any other person liable being void, voidable, set
aside or ordered to be refunded pursuant to any court order or enactment
relating to bankruptcy, liquidation, administration or insolvency or for
any other reason whatsoever and if such condition shall not be fulfilled,
the Lessor shall be entitled to enforce this Guarantee subsequently as if
such release, discharge or
<PAGE> 233
settlement had not occurred and any such security, disposition or payment
had not been made. The Lessor shall be entitled to retain this Guarantee
after as well as before the payment of or discharge of all of the
Guaranteed Liabilities for such period as the Lessor may choose.
20.6 All notices, demands or other communications under or in connection with
this Guarantee may be given by letter or facsimile or other comparable
means of communication addressed to the party at the address as the Lessor
may notify the Guarantor as the case may be in the Particulars. Any such
communication by the Lessor to the Guarantor will be deemed to be given as
follows:
(a) if personally delivered, at the time of delivery;
(b) if sent by facsimile or comparable means of communication, at the time
of transmission; and
(c) if by letter, at noon on the Business Day following the day such
letter was posted first class postage pre-paid (or in the case of
airmail, seven days after the envelope containing the same was
delivered into the custody of the postal authorities).
In proving such service it shall be sufficient to prove that
personal delivery was made or that such letter was properly
stamped first class, addressed and delivered to the postal
authorities or in the case of facsimile transmission or other
comparable means of communication, that a transmission report was
produced.
20.7 This Guarantee may be executed in any number of counterparts, each of
which, when so executed and delivered, shall be deemed an original, and
the counterparts together shall constitute only one instrument. Any or all
of the counterparts may be executed within or outside New South Wales. Any
one of the counterparts shall be sufficient for the purpose of proving the
existence and terms of this Guarantee, and no party shall be required to
produce an original or all of the counterparts in making such proof.
20.8 The parties hereto represent that they have been respectively represented
and advised by lawyers in connection with the execution of this Guarantee.
The Guarantor acknowledges receipt of a copy of the agreement for lease
relating to the Lease and of Lease itself, and further represents that the
Guarantor has been advised by lawyers qualified in Australia with respect
thereto. This Guarantee shall be construed and interpreted in accordance
with the plain meaning of its language, and not for or against either
party and as a whole, giving effect to all of the terms, conditions and
provisions hereof.
20.9 Except as provided in any other written agreement now or at any time
hereafter in force between the Lessor and the Guarantor, this Guarantee
shall constitute the entire agreement of the Guarantor with the Lessor
with respect to the subject matter hereof, and no representation,
understanding, promise or condition concerning the subject matter hereof
will be binding upon the Lessor unless expressed herein or therein.
20.10 All stipulations, obligations, liabilities and undertakings under this
Guarantee shall be binding upon the Guarantor and its successors and shall
enure to the benefit of the Lessor including without limitation any person
included in the definition of Lessor pursuant to Clause 1.
<PAGE> 234
20.11 The Lessor may assign, transfer, novate, dispose of, grant any interest in
or declare a trust in respect of its rights and obligations under this
Guarantee in whole or in part, without regard to any equities between the
Guarantor and the Lessor and without the consent of the Guarantor in
favour of any person (in this clause an "Assignee") including any person
to whom the immediate reversionary interest in any of the Group Leases or
any interest (including without limitation a Security Interest) in, under
or derived from the immediate reversionary interest in any of the Group
Leases is vested, assigned, transferred, novated, disposed of to or
granted at any time.
20.12 The Lessor may disclose any information concerning the Guarantor and its
Related Bodies Corporate (if any) to any Assignee or proposed Assignee, or
otherwise to any person in connection with any financing arrangement or
securitisation to which it or any PHFT Company may be a party, as it may
in its discretion think fit.
20.13 The Guarantor may not assign, transfer, novate or dispose of or grant any
of or declare any interest in respect of, or any interest in, its rights
and obligations under this Guarantee.
<PAGE> 235
DULY EXECUTED AS A DEED
<TABLE>
<S> <C>
Executed by MORAN HEALTH CARE GROUP PTY LIMITED without a common
seal acting by:
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Signature of authorised person Signature of authorised person
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Office held Office held
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Name of authorised person (print) Name of authorised person (print)
Signed, sealed and delivered by the
attorney of PRINCIPAL HEALTHCARE FINANCE
PTY LIMITED under power of attorney
registered Book ............ No
............ in the presence of:
. . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . .
Signature of attorney
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Signature of witness Office held
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Name of witness (print) Name of attorney (print)
</TABLE>
<PAGE> 236
APPENDIX 1
FORM OF SUPPLEMENTAL LETTER OF CREDIT
AND REPLACEMENT SUPPLEMENTAL LETTER OF CREDIT
(Date)
LETTER OF CREDIT NO:
BENEFICIARY:
PHFT
C/- Phillips Fox
255 Elizabeth Street
Sydney NSW 2000
We hereby establish our Irrevocable Transferable Standby Letter of
Credit number [] in favour of [] (the "Beneficiary") for the
account of [] up to the aggregate amount of $[] ([] dollars)
expiring on [] (the "Expiration Date") and hereby undertake that,
upon the Beneficiary's first written demand or demands made at any
time and from time to time on or before the Expiration Date, we
will pay to the Beneficiary in immediately available funds an
amount or amounts not exceeding $[] ([] dollars). Payment will be
made against any written demand in or substantially in the form of
the draft attached hereto signed by or on behalf of the
Beneficiary.
THIS LETTER OF CREDIT IS SUBJECT TO THE 1993 REVISION OF THE
UNIFORM CUSTOMS AND PRACTICE FOR DOCUMENTARY CREDITS OF THE
INTERNATIONAL CHAMBER OF COMMERCE (PUBLICATION NO 500).
WE HEREBY UNDERTAKE WITH YOU THAT DEMANDS UNDER AND IN COMPLIANCE
WITH THE TERMS OF THIS CREDIT WILL BE DULY PAID ON PRESENTATION
TO US AT [ ] ON OR BEFORE TO THE EXPIRATION DATE SHOWN ABOVE.
For and on behalf of [].
<PAGE> 237
[Form of Demand]
[]
Date: []
Irrevocable Transferable Standby Letter of Credit []
We hereby make demand for the payment of $[] ([] dollars)
drawn on the above mentioned Letter of Credit.
Yours very truly
.......................................
Name: []
Duly authorised
for and on behalf of
[]
<PAGE> 238
APPENDIX 2
SCHEDULE OF PROPERTY LEASED
Altona Vol. 8741 Fol. 761, 771
Meadow Heights Vol. 10342 Fol. 086
Mildura Previously Vol. 9892 Fol.
717, 719, 720 now being Lot 1
of Plan of Subdivision 409427J
(unregistered)
Warrnambool Vol. 10346 Fol. 571
Whittlesea Vol. 10390 Fol. 104
<PAGE> 239
DEED OF FIXED AND FLOATING CHARGE
(securing all money owing at any time as a principal debtor or guarantor)
THIS DEED IS MADE ON NOVEMBER 12 1998
PARTIES
PENDER BROS PTY LTD, ACN 000 003 556 of Level 1, 13-15 Bridge Street, Sydney,
New South Wales ("MORTGAGOR")
PRINCIPAL HEALTHCARE FINANCE PTY LIMITED, ACN 069 875 476 c/o Phillips Fox,
Level 12, 255 Elizabeth Street, Sydney, New South Wales in its own capacity and
as trustee of the Principal Healthcare Finance Trust ("MORTGAGEE")
RECITALS
The Mortgagee has agreed to provide or continue providing credit or financial
accommodation from time to time to or at the request of the Borrower and the
Mortgagor upon the condition that the Mortgagor enters into this deed.
AGREEMENTS BETWEEN THE PARTIES
1. DEFINITIONS AND INTERPRETATION
1.1 DEFINITIONS
1.1.1. In this deed:
"APPROVALS" includes all Aged Care Places, licences, consents,
registrations, certifications, accreditations and approvals relevant to
the use and operation of the Facility by the Mortgagor;
"BORROWER" means Moran Australia, Moran Group and any other person who
at any time in any capacity has obligations to the Mortgagee in respect
of which the Mortgagor has given a guarantee or indemnity to the
Mortgagee;
"BUSINESS" means the business or businesses carried on by the Mortgagor
in connection with the Facility at any time;
"CAPEX AGREEMENT" means the capital contribution agreement between the
Mortgagee, Moran Australia and Moran Group dated on or around the date
of this deed;
"DEBT" means any present or future debt (including, without limitation,
any book
<PAGE> 240
-2-
debt) owing to the Mortgagor in connection with the Facility;
"EVENT OF DEFAULT" means any event or circumstance referred to in clause
11.2;
"ENVIRONMENTAL PROTECTION LAW" means any legislation or any directive,
authority, permit or licence issued by an authority relating to
pollution, use of land or protection of the environment;
"FACILITY" means the nursing home described in Item 3 of the Schedule;
"GUARANTOR" means any person who at any time has given a guarantee or
indemnity to the Mortgagee in respect of any obligation owed to the
Mortgagee by the Mortgagor or a Borrower and includes the Mortgagor;
"LEASE" means the real property lease between the Mortgagee and Moran
Australia dated on or around the date of this deed;
"LEGAL REQUIREMENTS" includes Environmental Laws, the Essential
Legislation and the Planning Acts and means every other Act of
Parliament or requirement of any local or government authority or agency
relating to or affecting the Facility or the ownership, use,
construction, operation, maintenance, lease, sublease, repair,
rebuilding, occupation or alteration thereof or the employment or
residence therein of any person or otherwise howsoever relating to the
Facility or the interest of the Mortgagor or any third party in the
Facility.
This definition includes, unless a contrary intention is stated (without
limitation) every Act of Parliament whether named in this deed or not or
whether in force today or not and any subsequent statutory en-enactment
or modification of any Act of Parliament and any order, regulation,
directive, by-law, rule, consent or licence made or granted under any
Act of Parliament or by any public or local authority acting in its
official capacity, or by any court of competent jurisdiction.
"MORAN AUSTRALIA" means Moran Health Care (Australia) Pty Limited;
"MORAN GROUP" means Moran Health Care Group Pty Limited;
"MORTGAGED PROPERTY" means the Facility and all property, undertaking
and rights presently or in the future held by the Mortgagor in
connection with the Facility including (without limitation):
(a) the benefit of all Approvals; and
(b) the goodwill attaching to any Business.
"POTENTIAL EVENT OF DEFAULT" means any event or circumstance which with
the
<PAGE> 241
-3-
giving of notice, lapse of time or fulfilment of any condition would
become an Event of Default;
"RECEIVER" means a receiver appointed by the Mortgagee under this deed;
"RELATED BODY CORPORATE" has the same meaning as is given to that term
in the Corporations Law;
"SECURED MONEY" means any money which at any time under the Capex
Agreement:
(a) the Mortgagor or any Borrower in any capacity and whether alone or
with others:
(b) is actually or contingently liable to pay to the Mortgagee;
or
(b) may become actually or contingently liable to pay to the
Mortgagee in the future pursuant to any transaction or
arrangement at any time entered into or made by the
Mortgagee with any person;
(b) can be debited to any account of the Mortgagor or any Borrower with
the Mortgagee;
(c) has been advanced or paid by the Mortgagee to a person with the
express or implied consent or at the express or implied request of
the Mortgagor or any Borrower; or
(c) the Mortgagee is or may become actually or contingently
liable to pay a person in connection with a transaction or
arrangement entered into with the express or implied consent
or at the express or implied request of the Mortgagor or any
Borrower;
"TRUST" means a trust or settlement pursuant to which the Mortgagor
holds any Mortgaged Property; and
"TRUST DEED" means, in relation to a trust, the instrument setting out
all the terms currently governing that Trust.
1.1.2 Where any word or phrase is given a defined meaning any
other part of speech or other grammatical form in
respect of that word or phrase has a corresponding
meaning.
1.2 INTERPRETATION
1.2.1 A reference to:
<PAGE> 242
-4-
(a) a business day means a day during which banks are open for
general banking business in the state or territory whose
laws apply in the construction of this deed;
(b) this deed includes the recitals of and any schedules,
annexures and exhibits to this deed and where amended means
this deed as so amended;
(c) an item means an item of the schedule;
(d) a receiver includes a manager and a receiver and manager;
and
(e) a liquidator includes a provisional liquidator.
1.2.2 Unless the context otherwise requires, a word which denotes:
(a) the singular denotes the plural and vice versa;
(b) any gender includes the other genders; and
(c) a person includes an individual, a body corporate, and a
government.
1.2.3 Unless the context otherwise requires, a reference to:
(a) any legislation includes any regulation, by laws or
instrument made under it and any orders or instruments
having the force of law and where amended, re-enacted or
replaced means that amended, re-enacted or replacement
legislation;
(b) any other deed, agreement or instrument where amended or
replaced means that deed, agreement or instrument as amended
or replaced;
(c) a clause, schedule or annexure is a reference to a clause of
or annexure or schedule to this deed;
(d) a group of persons (including the Mortgagor if more than 1
person) includes any one or more of them; and
(e) any thing or amount is a reference to the whole and each
part of it.
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1.3 JOINT AND SEVERAL
Any agreement, warranty, representation or obligation which binds or
benefits 2 or more persons under this deed binds or benefits those
persons jointly and severally.
1.4 SUCCESSORS AND ASSIGNS
A person includes the trustee, executor, administrator, successor in
title and assignee of that person. This clause does not permit the
Mortgagor to assign any right under this deed.
1.5 HEADINGS AND TABLE OF CONTENTS
Headings and table of contents must be ignored in the interpretation of
this deed.
1.6 REFERENCES TO AND CALCULATIONS OF TIME
1.6.1 Unless the context otherwise requires, a reference to a
time of day means that time of day in the state or
territory whose laws apply in the construction of this
deed;
1.6.2 A reference to:
(a) a day means a period of time commencing at midnight
and ending 24 hours later; and
(b) a month means a calendar month which is a period
commencing at the beginning of a day of one of the
12 months of the year and ending immediately before
the beginning of the corresponding day of the next
month, or if there is no such corresponding day,
ending at the expiration of the next month.
1.6.3 Where a period of time is specified and dates from a
given day or the day of an act or event it must be
calculated exclusive of that day.
1.6.4 Where something is done or received after 5.00pm on any
day it will be deemed to have been done or received on
the following day.
1.6.5 A provision of this deed which has the effect of
requiring anything to be done on or by a date which is
not a business day must unless the context otherwise
requires be interpreted as if it required it to be done
on or by the immediately preceding business day.
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1.7 CORPORATE RELATIONSHIPS
A reference to a person being an associate of another person or a
company being related to or the subsidiary of another corporation or
being a holding company has the same meaning as in the Corporations
Law.
1.8 DEFINED TERMS FROM THE LEASE
Words which have a defined meaning in the Lease have the same meaning
when used in this deed unless the same word is also defined in this
deed, in which case the definition in this deed prevails to the extent
of the inconsistency.
2. CHARGE AND ITS NATURE
2.1 CHARGE
The Mortgagor charges the Mortgaged Property to the Mortgagee as
security for the payment of the Secured Money and the due performance
of all its other obligations to the Mortgagee.
2.2 LIABILITY UNDER THIS DEED
The Mortgagor's liability under this deed are in respect of the whole
of the Secured Money. However, the Mortgagor's liability under this
deed is in aggregate limited to $5,000,000.00 plus any interest
payable on that amount and any costs or expenses of any nature
whatsoever incurred by the Mortgagee under or in connection with this
deed or any associated security.
2.3 TITLE DOCUMENTS
Subject to the rights of the holder of any prior ranking mortgage or
charge, the Mortgagor must immediately lodge with the Mortgagee all
documents of or evidencing title to any Mortgaged Property.
2.4 FIXED CHARGE
This charge is fixed on the Mortgaged Property which is:
(a) the benefit of all Approvals; and
(b) the Facility.
2.5 FLOATING CHARGE
Subject to clauses 2.6 and 2.7, this charge is floating on any
Mortgaged Property not referred to in clause 2.3 (including, without
limitation, the proceeds of payment of any Debt).
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2.6 DEALINGS WITH MORTGAGED PROPERTY SUBJECT TO FLOATING CHARGE
The Mortgagor may in the ordinary course of its ordinary business sell
or otherwise deal with any Mortgaged Property over which this charge
is floating.
2.7 CONVERSION OF FLOATING CHARGE TO FIXED CHARGE
The Mortgagee may at any time by written notice to the Mortgagor
convert this charge from a floating charge to a fixed charge in
relation to the Mortgaged Property specified in the notice.
2.8 CRYSTALLISATION OF FLOATING CHARGE
2.8.1 This charge will automatically and immediately
crystallise and take effect as a fixed charge in
respect of all Mortgaged Property not already
subject to a fixed charge upon:
(a) the appointment of a Receiver or the security
constituted by this deed being enforced in any
other way; or
(b) an Event of Default described in clause 11.2(e)
occurring in respect of the Mortgagor or any
subsidiary.
2.8.2 This charge will automatically and immediately
crystallise and take effect as a fixed charge in respect
of any Mortgaged Property not already subject to a fixed
charge upon:
(a) a notice under clause 2.6 being given in respect of
that Mortgaged Property;
(b) the earlier of the Mortgagor doing, permitting or
agreeing, resolving, deciding, issuing instructions
or commencing to do or permit anything prohibited
under clause 7.1 in relation to that Mortgaged
Property;
(c) an Event of Default described in clauses 11.2(h) or
11.2(j) occurring or any steps which would lead to
the occurrence of such an Event of Default being
taken in relation to that Mortgaged Property; or
(d) any action being taken to enforce any charge or
other security over that Mortgaged Property.
2.8.3 This charge will automatically and immediately
crystallise and take effect as a fixed charge over
Mortgaged Property not already subject to a fixed charge
in respect of which a government agency may in any way
rank for payment of any taxes ahead of a floating
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charge upon the Mortgagor failing to pay any such taxes
when payable.
2.9 DE-CRYSTALLISATION
The Mortgagee may by and with effect from notice to the Mortgagor
convert any charge which has become fixed over Mortgaged Property
pursuant to clauses 2.6 or 2.7 back to a floating charge in respect of
the Mortgaged Property specified in the notice (subject to the further
effects of clauses 2.6 and 2.7).
3. PERFORMANCE OF MORTGAGOR' S OBLIGATIONS GENERALLY
3.1 PERFORMANCE OF ALL OBLIGATIONS
In addition to its obligations under this deed, the Mortgagor must:
(a) duly perform all of its other obligations (both positive
and negative) at any time owed to the Mortgagee (including,
without limitation, the payment of Secured Money when
payable); and
(b) duly perform or cause the due performance of all of the
obligations of a Borrower at any time owed to the Mortgagee
whether or not the Mortgagor has consented to that Borrower
undertaking such obligations.
3.2 THE MORTGAGEE'S RIGHT TO REMEDY
If the Mortgagor or a Borrower fails to duly perform any obligation
owed to the Mortgagee, the Mortgagee may do anything it considers
appropriate to protect its interests including, in its discretion
performing such obligation itself. The costs of and liabilities
incurred from any such action must be paid by the Mortgagor upon
demand. Action by the Mortgagee to protect its interests does not
amount to waiver of an Event of Default.
4. PAYMENT OF SECURED MONEY
4.1 TIME FOR PAYMENT
Subject to clause 4.3, the Mortgagor must pay the Secured Money to the
Mortgagee at the times and in the manner expressly agreed between the
Mortgagor or any Borrower and the Mortgagee or, in the absence of any
express agreement, immediately upon demand by the Mortgagee.
4.2 NO PRE-CONDITION TO DEMANDING PAYMENT OF THE SECURED MONEY
The Mortgagor acknowledges that the Secured Money includes any money
owing at any time by any Borrower to the Mortgagee and agrees to pay
the
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Secured Money when it becomes payable pursuant to clause 4.1
irrespective of whether the Mortgagee has made any demand on any
Borrower or any other person liable to pay the Secured Money.
4.3 PAYMENT FOLLOWING AN EVENT OF DEFAULT
If an Event of Default occurs, the Mortgagor must pay the Secured
Money to the Mortgagee immediately upon demand.
4.4 PAYMENT WITHOUT DEDUCTION OR SET-OFF
Secured Money must be paid in full without any deduction. The
Mortgagor waives all rights of set-off, combination or counterclaim in
relation to payment of Secured Money.
4.5 CREDIT FOR PAYMENT
4.5.1 The Mortgagor will be given credit for payment of
Secured Money only upon its actual receipt in
immediately available funds.
4.5.2 If Secured Money is received by the Mortgagee on a day
which is not a business day or after 12.00pm on any
business day the Mortgagee may refuse to credit receipt
until the next business day in which case the Mortgagor
must pay interest on that Secured Money until the
receipt is credited.
4.6 APPLICATION OF PAYMENTS
4.6.1 The Mortgagor irrevocably waives its right to determine
the appropriation of any money paid to the Mortgagee.
All payments of Secured Money may be applied in the
discretion of the Mortgagee towards reduction or
satisfaction of whichever part of the Secured Money the
Mortgagee elects.
4.6.2 The rule in Clayton's case does not apply. If the
Mortgagee has not made an election it will be deemed to
have applied payments in the manner and against such
Secured Money as is in its best interests.
4.6.3 So long as no Event of Default has occurred or is
continuing, any money received by the Mortgagee in
excess of Secured Money then presently payable will be
refunded to the Mortgagor.
4.6.4 If an Event of Default has occurred or is continuing,
any money received by the Mortgagee in excess of Secured
Money then presently payable may be placed in an
interest bearing account in the name of the Mortgagee
and applied against Secured Money as
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it becomes presently payable.
4.6.5 Money in an account pursuant to clause 4.6.3 belongs to
the Mortgagee. The Mortgagee must upon payment of the
Secured Money in full and the Mortgagee being satisfied
that no further Secured Money will arise pay to the
Mortgagor (as a debt due) an amount equal to the balance
of the account (including accrued interest).
4.7 PLACE FOR PAYMENT OF MONEY
Subject to any express written agreement to the contrary, all Secured
Money must be paid to the Mortgagee at the place notified to the
Mortgagor, or, in the absence of notice, at the Mortgagee's address in
this deed.
4.8 SET-OFF AGAINST OTHER ACCOUNTS
The Mortgagor irrevocably authorises the Mortgagee at any time without
notice to set-off against or combine with any Secured Money then
presently payable any amount in any currency standing to the credit of
any account of the Mortgagor with the Mortgagee. The Mortgagee has no
obligation to effect any set-off or combination under this clause.
This right is in addition to any rights arising under general law.
4.9 OVERPAYMENT
The Mortgagee is not required to pay or credit the Mortgagor with
interest on overpayment of the Secured Money. The Mortgagee at its
discretion may shed responsibility for the excess money by paying it
to a subsequent mortgagee or other encumbrancee (whether or not
registered), into court or to the credit of a bank account it opens up
in the Mortgagor's name and notifying the Mortgagor of what it has
done.
4.10 PAYMENT IN WRONG CURRENCY
If the Mortgagee receives payment of the Secured Money in a currency
other than that in which payment is due the Mortgagor will be given
credit:
(a) by reference to the spot rate at which the
Mortgagee is able to directly or indirectly
purchase the currency in which the payment is due;
(b) for the amount of the correct currency purchased
after deducting the costs of conversion; and
(c) on the date of settlement of the conversion into
the currency in which the payment is due.
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4.11 INTEREST
4.11.1 The Mortgagor must on the last day of each month or upon
earlier demand pay interest calculated at the Overdue
Rate on daily balances of any Secured Money which does
not otherwise bear interest from the earlier of the date
it became payable to or was outlaid by the Mortgagee to
the date of payment.
4.11.2 The Mortgagor acknowledges that pursuant to clause
4.11.1 Secured Money which is interest not paid on its
due date will itself bear interest at the Overdue Rate.
4.11.3 The charging, demanding and receipt of interest on
Secured Money not paid when due will not amount to a
waiver of the Mortgagee's rights pursuant to the Event
of Default arising because of that non-payment.
5. INSURANCE OBLIGATIONS
5.1 INSURANCE OF MORTGAGED PROPERTY
The Mortgagor must keep the tangible Mortgaged Property insured for its
full insurable value on a replacement and a reinstatement basis against
fire and such other risks as a prudent owner of similar property would
normally insure against or as are reasonably required by the Mortgagee.
This insurance must include the Mortgagee as an insured party for its
rights and interests.
5.2 PUBLIC RISK AND OTHER INSURANCES
The Mortgagor must maintain public risk insurance for an amount approved
by the Mortgagee and such other insurances which a prudent person
carrying on a similar business to any Business would effect or which the
Mortgagee reasonably requires.
5.3 GENERAL INSURANCE OBLIGATIONS
The Mortgagor must in respect of each insurance required under
this deed:
(a) effect it with a reputable insurer approved by the
Mortgagee (which approval must not be unreasonably
withheld);
(b) deposit an original or duplicate of the policy with
the Mortgagee;
(c) effect and renew the insurance for a period of not
less than 1 year;
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(d) pay all premiums for renewals not less than 3
business days before expiry;
(e) immediately notify the Mortgagee of anything which
may give rise to a claim;
(f) immediately notify the Mortgagee of any
cancellation or proposal to cancel; and
(g) refrain from any action which may have the effect
of rendering it unenforceable.
5.4 ASSIGNMENT OF INSURANCE PROCEEDS
5.4.1 The Mortgagor absolutely assigns to the Mortgagee as
security for the Secured Money all its rights to demand,
sue for, recover and receive proceeds of any insurance
in respect of loss or destruction of or damage to any
Mortgaged Property and any insurance effected pursuant
to clause 5.2.
5.4.2 Except in accordance with the Mortgagee's express
instructions, the Mortgagor must not make claims, sue
for, recover, settle, compromise or otherwise deal with
any right to receive proceeds of any such insurance.
5.4.3 The proceeds of any insurance referred to in clause
5.4.1 must be applied in reduction of the Secured Money
or if the Mortgagee in its discretion permits in
reinstatement or replacement of the Mortgaged Property.
6. UNDERTAKINGS RELATING TO THE MORTGAGOR'S BUSINESS AND ASSETS
6.1 CARRYING ON THE BUSINESS
The Mortgagor must ensure that the Business continues to be carried on
in a good, proper and efficient manner and, without limitation, that:
(a) all legislation applying to the Business or the
Mortgaged Property is observed, including without
limitation all Approvals and Legal Requirements
applying to the Business;
(b) all approvals, licences, permits and consents
reasonably necessary for carrying on the Business,
including without limitation all Approvals applying
to the Business, are obtained and maintained and
that their conditions and terms are duly complied
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with;
(c) no agreement relating to the Business or the
Mortgaged Property is breached or cancelled if
breach or cancellation would or may have a material
adverse effect on the Business or any aspect of it
or the Mortgaged Property;
(d) all taxes (including without limitation rates) and
statutory charges of whatever nature payable at any
time in relation to the Business or the Mortgaged
Property are paid by the due date for their
payment; and
(e) the value of the Mortgagee's security under this
deed is not diminished other than by circumstances
beyond the control or influence of the Mortgagor.
6.2 REPAIR AND SECURITY
The Mortgagor must keep all tangible Mortgaged Property in good repair
and condition and well protected from theft, loss or damage.
6.3 REPLACEMENT OF DAMAGED OR DESTROYED PROPERTY
The Mortgagor must immediately replace any tangible Mortgaged Property
which is stolen, lost, damaged or destroyed with articles of no lesser
quality and standard.
6.4 PERFORMANCE OF ALL LEASE OBLIGATIONS
6.4.1 The Mortgagor must duly perform the terms of any lease,
tenancy or licence granted to the Mortgagor of any real
or personal property.
6.4.2 The Mortgagor must properly exercise any option to
extend the term of any lease of premises used in
connection with the Business unless it has obtained the
use of satisfactory alternative premises.
6.5 COMPLIANCE BY MORAN AUSTRALIA AND MORAN GROUP WITH THE CAPEX
AGREEMENT
6.5.1 The Mortgagor must ensure that Moran Australia and Moran
Group duly comply with their respective obligations
under the Capex Agreement.
6.5.2 The Mortgagor must promptly notify the Mortgagee as soon
as it becomes aware of any breach or non-compliance by
Moran
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Australia or Moran Group with the Capex Agreement.
6.6 MAINTENANCE OF BOOKS AND ACCOUNTS
The Mortgagor must maintain proper books and records which correctly
record and explain the transactions undertaken in relation to the
Business and the financial position of the Business and the Mortgagor
and enable the preparation from time to time of true and fair accounts
for the Business and the Mortgagor.
6.7 ENVIRONMENTAL RISK MANAGEMENT
6.7.1 This clause applies if the Mortgagee at any time
determines that in the context of Environmental
Protection Law and any Business or any activity carried
on using Mortgaged Property there is a risk that this
security or its value or the Mortgagor's ability to pay
Secured Money may be adversely affected. If the
Mortgagee notifies the Mortgagor that it has made such a
determination the Mortgagor must establish and maintain
an environmental risk management programme which:
(a) identifies all licences and approvals required from
any authority concerned with the control of
pollution in connection with a Business or the use
of the Mortgaged Property or the storage of any
substances on the Mortgaged Property and
establishes procedures for ensuring that the
conditions attaching to those licences and
approvals are complied with;
(b) identifies the potential for any Business or the
use of the Mortgaged Property or the storage of any
substances on the Mortgaged Property to cause
pollution and establishes procedures for ensuring
that the risk of pollution is minimised; and
(c) establishes training programmes which ensure that
people engaged in any Business or any activity
carried on on the Mortgaged Property or the storage
of any substances on the Mortgaged Property are
aware of the risks of pollution occurring and the
measures to be taken to minimise those risks.
6.7.2 The Mortgagor must, upon request by the Mortgagee:
(a) provide the Mortgagee with full details of its
environmental risk management programme established
pursuant to clause 6.6.1 and a certificate signed
by 2 directors of the Mortgagor certifying that
that programme is being complied with;
(b) have its environmental risk management programme
established pursuant to clause 6.6.1 and its
compliance with that
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programme reviewed by an independent consultant approved
by the Mortgagee who is experienced in the management of
pollution risk similar to that involved in the Business
or the activities being carried on on the Mortgaged
Property and comply with the recommendations of that
consultant; and
(c) provide the Mortgagee with full details of any
internal or external (pursuant to paragraph (b) or
otherwise) review or audit of its environmental
risk management programme established pursuant to
clause 6.6.1.
7. NEGATIVE COVENANTS
7.1 PROHIBITION ON DEALING WITH THE MORTGAGED PROPERTY
7.1.1 Subject to clauses 2.5 and 7.1.3, the Mortgagor must
not, without the Mortgagee's consent:
(a) sell, assign, lease, charge, encumber, surrender,
grant any interest in or power over or otherwise in
any manner deal or agree or attempt to deal with
any Mortgaged Property or any interest in any
Mortgaged Property; or
(b) permit any charge, lien, pledge, hypothecation,
security, trust or power to arise or exist in
respect of any Mortgaged Property.
7.1.2 The Mortgagor's statutory powers to deal with the
Mortgaged Property are, to the fullest extent possible,
excluded.
7.1.3 The Mortgagor will not be in default of its obligations
under clause 7.1.1 because a charge arises by
legislation in favour of a governmental agency except
where the Mortgagor has not paid when payable money
owing to that governmental agency.
7.2 PROHIBITION ON DEALINGS WITH DEBTS
7.2.1 Without limiting clause 7.1, the Mortgagor must not
sell, assign or otherwise deal with any Debt without the
Mortgagee's consent.
7.2.2 The Mortgagor must prevent any set-off or combination of
accounts in respect of any Debt.
7.3 PROHIBITION ON ACTS PREJUDICIAL TO THE MORTGAGEE'S SECURITY
The Mortgagor must not exercise any right arising in relation to the
Mortgaged Property or directly or indirectly cause or influence any
decision of any person which has or may have an adverse effect on the
Mortgagee's security under this
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deed or its value.
7.4 PROHIBITIONS IN RELATION TO THE BUSINESS
The Mortgagor must not, without the Mortgagee's consent:
(a) change the nature of the Business at any time;
(b) contract out or licence any part of the Business; or
(c) vary or surrender any lease or licence held at any time in
connection with the Business or the Mortgaged Property.
7.5 PROHIBITION RELATING TO CAPITAL
The Mortgagor must not, without the Mortgagee's consent, propose, do or
permit:
(a) anything which amounts to a waiver or postponement
or an agreement to waive or postpone obligations in
respect of shares in the Mortgagor or any
subsidiary; or
(b) anything which amounts to financing dealings in or
acquiring its own shares including, without
limitation, anything specified in section 260A of
the Corporations Law.
7.6 OTHER PROHIBITIONS NOT TO BE AFFECTED
Nothing in this deed affects any other prohibition agreed by the
Mortgagor with the Mortgagee.
8. PROVISIONS APPLYING TO A TRUSTEE MORTGAGOR
8.1 APPLICATION OF CLAUSE 8
Clause 8 applies where the Mortgagor is the owner or registered
proprietor of Mortgaged Property as trustee of a Trust.
8.2 WARRANTIES RELATING TO THE TRUST
The Mortgagor warrants to the Mortgagee that:
(a) a true and complete copy of the Trust Deed has been
supplied to the Mortgagee's solicitors;
(b) the Trust is validly created and subsisting and no
circumstances exist pursuant to which it may be
determined and no date for the
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vesting of any of the Trust fund has been appointed
other than as may be set out in the Trust Deed;
(c) the Mortgagor is validly appointed as the sole
trustee of the Trust, is not in breach of its
obligations as trustee and no circumstances exist
pursuant to which it may be removed;
(d) this deed is duly executed and granted pursuant to
and in proper exercise of the powers of the
Mortgagor as trustee of the Trust and all
formalities required by the Trust Deed in
connection with this deed have been complied with;
(e) the execution and performance of this deed is a
proper purpose of the Trust and the Trust is
receiving a valuable commercial benefit in return
for entering into this deed;
(f) the Mortgagor is entitled to be fully indemnified
out of the assets of the Trust in respect of its
liability for Secured Money;
(g) the Mortgagor is the legal owner of all the assets
of the Trust; and
(h) there is no dispute between the Mortgagor and any
other person in relation to the Trust or the Trust
assets.
8.3 SPECIFIC PROHIBITIONS RELATING TO THE TRUST
The Mortgagor must not, without the Mortgagee's consent:
(a) cease to be the sole trustee of the Trust;
(b) cause or permit the Trust to be determined or a
vesting date to be appointed;
(c) do or permit anything which adversely affects the
Mortgagor's right of indemnity against the Trust
assets;
(d) in any way vary the Trust Deed or permit it to be
varied;
(e) distribute or dispose of any Trust assets; or
(f) delegate any powers of the Mortgagor as trustee of
the Trust or exercise any power of appointment.
8.4 FINANCIAL INFORMATION
The Mortgagor must at the request of the Mortgagee provide full
financial details
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of the Trust.
8.5 MORTGAGOR'S RIGHT OF INDEMNITY
Without limiting any right of subrogation the Mortgagee may have, the
Mortgagor must at the Mortgagee's request exercise the Mortgagor's right
of indemnity against Trust assets to enable payment of the Secured Money
to the Mortgagee.
8.6 NEW TRUSTEES
The Mortgagor must procure that any person who becomes a trustee of the
Trust (whether in replacement of or in addition to the Mortgagor) enters
into a deed with the Mortgagee whereby it agrees to perform the
obligations of the Mortgagor under this deed.
8.7 MORTGAGOR'S LIABILITY UNLIMITED
The Mortgagor's liability to pay Secured Money to the Mortgagee and to
perform its other obligations owed to the Mortgagee is not limited or
otherwise affected by the Mortgagor being trustee of any trust or the
extent of its ability to indemnify itself out of the assets of the
Trust.
9. WARRANTIES AND INDEMNITIES
9.1 WARRANTIES
9.1.1 The Mortgagor warrants to the Mortgagee that:
(a) this deed constitutes and will continue to
constitute a valid and binding security enforceable in
accordance with its terms;
(b) no Event of Default or Potential Event of Default
has occurred or is likely to occur;
(c) the Mortgagor has obtained all necessary consents
and complied with all internal procedures in relation
to the execution and performance of this deed;
(d) there is no breach of any Environmental Protection
Law in respect of the use or condition of the Mortgaged
Property or the carrying on of any Business and there
are no outstanding notices or restraining orders
affecting the Mortgaged Property or its use or any
Business issued pursuant to any Environmental
Protection Law;
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(e) the Mortgagor has disclosed to the Mortgagee the
full extent of the interests in and control of the
Mortgagor; and
(f) no other person has any interest or rights in
respect of the Mortgaged Property and no property is
held by the Mortgagor subject to any reservation of
title in favour of another person except as expressly
disclosed in writing to the Mortgagee prior to this
deed.
9.1.2 Each warranty contained in clause 9.1.1 will be deemed
to be repeated on each day whilst any Secured Money
remains outstanding, with reference to the facts and
circumstances then subsisting, as if made on each such
day.
9.2 INDEMNITIES
9.2.1 The Mortgagor indemnifies the Mortgagee against all
actions, claims, demands, losses, damages, liabilities,
costs and expenses of any nature incurred at any time
actually or contingently by the Mortgagee arising
directly or indirectly from:
(a) a failure by the Mortgagor to pay any Secured Money
when payable or comply with any other obligation owed to
the Mortgagee;
(b) the Mortgagee, a Receiver or an attorney appointed
under this deed exercising or attempting to exercise any
power or right under this deed, in any other agreement
between the Mortgagor and the Mortgagee or at general
law;
(c) the Mortgagee entering into any agreement or
transaction in connection with this deed;
(d) the Mortgagee seeking to recover any Secured Money
from any other person liable to pay it;
(e) an actual or assumed legal obligation of the
Mortgagee to pay any money or do any thing in connection
with the Mortgaged Property;
(f) a warranty in this deed being incorrect in any
respect;
(g) judgment being given for any Secured Money in a
currency other than that which that Secured Money is
due;
(h) the rate of interest applying to any judgment debt
being less than that applying to the original obligation
to pay Secured Money
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in respect of which judgment was obtained;
(i) a claim that a payment, obligation, settlement,
transaction, conveyance or transfer in connection with
Secured Money (or money which would be Secured Money if
the claim was invalid) is void or voidable under any law
relating to insolvency, bankruptcy or the protection of
creditors or for any other reason being upheld conceded
or compromised;
(j) the appointment of or any indemnity given to a
Receiver;
(k) the Mortgagee acting as the Mortgagor's attorney or
providing any indemnity to any person so acting; or
(l) the Mortgagee paying (whether or not under a legal
obligation) any loss, cost or expense incurred by any
officer, employee, agent or consultant of the Mortgagee
in connection with this deed.
9.2.2 The Mortgagor indemnifies the Mortgagee, its directors
and any other officers in management and control of the
Mortgagee at any time and any Receiver against all
actions, fines, claims, demands, losses, damages, costs
and expenses of any nature incurred at any time actually
or contingently arising directly or indirectly from any
breach of any Environmental Protection Law in connection
with the Mortgaged Property.
10. PROVISION OF INFORMATION AND ACCESS FOR THE MORTGAGEE
10.1 ACCESS TO THE BUSINESS AND MORTGAGED PROPERTY
10.1.1 The Mortgagor authorises the Mortgagee, its employees,
consultants, agents and advisers to enter any part of
the premises from which any Business is carried on. To
the extent that the Business is carried on from other
premises which are Mortgaged Property or upon which any
Mortgaged Property is kept for any purpose in connection
with this deed, the Mortgagor must procure that the
Mortgagee has reasonable access to such premises on
giving reasonable notice. The Mortgagor must obtain any
necessary consent and give any person exercising this
right reasonable assistance in carrying out his
requirements. The Mortgagee may take copies of any books
and records and photographs of the Mortgaged Property.
10.1.2 The Mortgagee must not exercise this right without
giving the Mortgagor at least 24 hours' prior notice
except where an Event of Default has occurred or the
Mortgagee believes that its security may be prejudiced.
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10.2 NOTIFICATION OF MATTERS TO THE MORTGAGEE
10.2.1 The Mortgagor must immediately notify the Mortgagee of
the following:
(a) the occurrence of an Event of Default or Potential
Event of Default;
(b) any notice received from any authority which
notifies a breach of any legislation or of a condition
attaching to a licence or approval held by the
Mortgagor, which requires or anticipates any
acquisition or divestment of any Mortgaged Property or
which may otherwise affect or potentially affect the
Mortgagee's security under this deed;
(c) any notice requiring any work to be done to
Mortgaged Property or relating to the use or condition
of Mortgaged Property including, without limitation,
notices or orders pursuant to any Environmental
Protection Law;
(d) the receipt by the Mortgagor of any demand pursuant
to section 459E of the Corporations Law;
(e) any damage to or destruction of any Mortgaged
Property of a value in excess of $10,000; and
(f) anything which gives or may give rise to a claim for
compensation for an amount exceeding $10,000 in relation
to Mortgaged Property.
10.2.2 The Mortgagor must provide the Mortgagee with such other
information following notification under clause 10.4.1
as the Mortgagee requires.
11. EVENT OF DEFAULT
11.1 MORTGAGOR TO PREVENT EVENT OF DEFAULT
The Mortgagor must prevent the occurrence of an Event of Default.
11.2 EVENT OF DEFAULT
An Event of Default occurs if:
(a) the Mortgagor or any Borrower fails to pay when
payable any Secured Money;
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(b) the Mortgagor or any Borrower defaults in the
performance or observance of any obligation owed or
undertaking given to the Mortgagee which is not the
payment of Secured Money and, to the extent that that
default is capable of remedy within 5 business days, it
continues for 5 business days after written notice from
the Mortgagee requiring its remedy;
(c) a warranty, representation, answer to requisition or
statutory declaration made or given by or on behalf of
the Mortgagor or a Borrower or Guarantor in connection
with this deed or Secured Money is found to be incorrect
or misleading;
(d) a Borrower or a Guarantor defaults in the
performance of any obligation owed to the Mortgagee
pursuant to:
(d) an agreement under which a Borrower or a Guarantor
has an actual or contingent liability to pay any money
which the Mortgagor is also actually or contingently
liable to pay;
(d) an agreement which relates to or is connected with
any agreement falling within sub-paragraph (i); or
(d) any legal or equitable mortgage, charge or other
security of any nature and howsoever created or arising
pursuant to which the Borrower or Guarantor secures an
obligation under any agreement falling within
sub-paragraph (i) or (ii),
and to the extent that that default is not the payment of money
and is capable of remedy within 5 business days and if there is
no period in the relevant agreement within which to remedy it,
the default continues for 5 business days after written notice
from the Mortgagee requiring its remedy;
(e) any of the following occur in respect of a
corporation which is the Mortgagor or a Borrower or
Guarantor or which is related to the Mortgagor or a
Borrower or Guarantor:
(e) an application is made, proceedings are initiated or
a meeting (whether of shareholders, creditors or
directors) is called with a view to winding it or any
part of its undertaking up or placing it or any part of
its undertaking under any kind of administration;
(e) a receiver, liquidator or voluntary or other
administrator is appointed;
(e) a compromise or arrangement of the kind referred to
in part 5.1
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of the Corporations Law is proposed;
(e) an application is made or an action is initiated
with a view to cancelling its registration or
appointing an inspector or other officer to investigate
any of its affairs pursuant to any legislation;
(e) it is, or is or may be deemed under any applicable
law to be, insolvent or unable to pay its debts; or
(e) circumstances exist which would enable the court
upon application to order its winding up pursuant to
section 461 of the Corporations Law;
(f) any of the following occurs in respect of an
individual who is a Borrower or a Guarantor:
(f) he or she commits an act of bankruptcy within the
meaning of section 40 of the Bankruptcy Act 1966; or
(f) he or she dies or becomes incapable of managing his
or her own affairs by reason of mental or other
condition;
(g) any of the following occur in respect of a
partnership which is a Borrower or a Guarantor:
(g) the dissolution of the partnership;
(g) any application to a court for the dissolution of
the partnership being made; or
(g) the retirement within any period of 6 months of more
than 20% of the members of the partnership without the
Mortgagee's consent;
(h) distress is levied or a judgment or order is
enforced or executed on or against any assets of the
Mortgagor or a Borrower or Guarantor or any of those
assets are attached to answer any judgment debt;
(i) a judgment for an amount in excess of 1% of the
Secured Money is entered in any court against the
Mortgagor or a Borrower or Guarantor and not satisfied,
appealed or set aside within 28 days;
(j) any assets of the Mortgagor or a Borrower or
Guarantor are confiscated, cancelled or forfeited;
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(k) the Mortgagor or a Borrower or Guarantor stops
payment of its debts or ceases or threatens to cease to
carry on any of its businesses;
(l) any legislation is passed or anything else occurs
which in the reasonable opinion of the Mortgagee
materially and adversely affects any of its rights under
this deed;
(m) a provision of this deed does not or ceases to have
full effect to the Mortgagee's reasonable satisfaction;
(n) the Mortgagor or a Borrower or Guarantor which is a
company reduces or attempts to reduce its capital,
alters or proposes to alter its articles of association
or directly or indirectly acquires or proposes to
acquire its own shares without the Mortgagee's consent;
(o) the holder of any security given at any time over
any assets of the Mortgagor or a Borrower or Guarantor
becomes entitled to exercise any powers arising on
default pursuant to that security or otherwise take
action to enforce that security;
(p) a person who has provided credit or financial
accommodation to the Mortgagor or a Borrower or
Guarantor becomes entitled to accelerate any obligation
of the Mortgagor or that Borrower or Guarantor to pay
money to that person;
(q) the Mortgagor fails to duly comply with a condition
attaching to a consent or approval issued by the
Mortgagee in the context of this deed;
(r) any Mortgaged Property is damaged or destroyed or
becomes affected by any proposal to an extent that in
the Mortgagee reasonable opinion the value of all the
Mortgaged Property (ignoring any insurance claim or
compensation) is reduced by more than 5%;
(s) where the Mortgagor is a corporation listed on a
stock exchange, its shares are suspended from quotation
because of a breach of any listing or other rules of
that stock exchange;
(t) where the Mortgagor is a corporation which is not
listed on a recognised Australian stock exchange there
is a change in the ownership (at the date of this deed)
of more than 25% of the issued voting shares in the
Mortgagor or there is a change in the control of the
Mortgagor without the Mortgagee's consent;
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(u) in the Mortgagee's opinion there is any change in
the activities of the Mortgagor or any Borrower or
Guarantor which could materially and adversely
affect the ability of that person to meet any of its
obligations to the Mortgagee;
(v) the Mortgagor ceases to carry on the whole or a
substantial part of a Business or disposes of the assets
of or an interest in a Business, a licence, or Approval,
or other right in connection with a Business is disposed
of, cancelled or not renewed;
(w) a notice is served on the Mortgagor in respect of a
breach of or liability arising under any legislation
including any Essential Legislation, directive,
authority or permit relating to pollution and not
complied with;
(x) in connection with any Mortgaged Property or the
Mortgagor the Mortgagee becomes actually or contingently
liable to pay money or do anything pursuant to the
application of any legislation, directive, authority or
permit relating to pollution;
(y) any proceedings are commenced against the Mortgagor
or any occupier of Mortgaged Property pursuant to a
breach of any Environmental Protection Law;
(z) without limiting the operation of any other Event of
Default, any other event occurs or circumstance arises,
financial or otherwise, which, in the opinion of the
Mortgagee, is likely to materially and adversely affect:
(z) the ability of the Mortgagor or any other person
actually or contingently liable to pay the Secured
Money;
(z) the ability of the Mortgagor to comply with its
obligations under this deed;
(z) the Mortgagee's security under this deed;
(z) the value of the Mortgaged Property; or
(z) the ability of a Borrower to duly perform its
obligations to the Mortgagee;
(aa) Moran Australia or Moran Group defaults in the
performance of any of their respective obligations under
the Capex Agreement, and does not remedy or rectify such
breach in accordance with the Capex Agreement;
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(bb) the Approvals are revoked, suspended, withdrawn,
terminated or forfeited for any reason; or
(cc) there is any material change, variation or
amendment to the Approvals and the result is likely, in
the opinion of the Mortgagee to have a material
adverse effect on the Business.
11.3 NO DEFAULT CERTIFICATE
At the request of the Mortgagee the Mortgagor must immediately give the
Mortgagee a certificate signed by 2 directors of the Mortgagor stating
whether or not an Event of Default has occurred or is likely to occur.
11.4 REPORT BY QUALIFIED ACCOUNTANT
Following the occurrence of any Event of Default whether or not the
Mortgagee has exercised any of its rights and powers on default, the
Mortgagor at its cost must at the request of the Mortgagee promptly
provide the Mortgagee with a report by a qualified accountant approved
by the Mortgagee on the financial condition of the Mortgagor, the
Business, the value of any Mortgaged Property and any other related
matter the Mortgagee requires.
12. THE MORTGAGEE'S POWERS FOLLOWING EVENT OF DEFAULT
12.1 EXERCISE OF POWERS GENERALLY
The Mortgagee may exercise its powers under clauses 12 and 13:
(a) whether or not it has demanded payment of the
Secured Money;
(b) in the manner and at the times it wishes;
(c) irrespective of any omission, neglect or delay; and
(d) notwithstanding that any negotiable instrument
evidencing or giving rise to Secured Money has not
matured.
12.2 TERMINATION OF TRANSACTIONS AND PAYMENT OF PRIOR MORTGAGEES
Following the occurrence of an Event of Default, the Mortgagee may:
(a) terminate or reverse any transaction or arrangement
entered into by the Mortgagee at the express or implied
request or with the express or implied consent of the
Mortgagor;
(b) enter into any transaction and make any payment to
extinguish
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any actual or contingent liability incurred by the
Mortgagee at the express or implied request or with the
express or implied consent of the Mortgagor;
(c) convert (directly or indirectly) the currency of any
obligation of the Mortgagor to the Mortgagee to another
currency; or
(d) pay any other mortgagee or encumbrancee of Mortgaged
Property any amount required to discharge or purchase
(with or without a transfer of its security) its debt.
The Mortgagor must upon demand reimburse the Mortgagee all payments made
and costs and expenses incurred pursuant to anything done under this
clause.
12.3 THE MORTGAGEE'S GENERAL POWERS
Following the occurrence of an Event of Default, the Mortgagee may:
(a) enter into possession and control of, manage and use
the Mortgaged Property;
(b) receive rents, profits and other payments in
relation to the Mortgaged Property;
(c) carry on, contract out, lease or licence the
Business and any other business in relation to the
Mortgaged Property;
(d) take any action it considers necessary or desirable
to preserve, maintain or enhance the Mortgaged Property,
the Business or the security constituted by this deed:
(e) effect and maintain any insurance of or in relation
to the Mortgaged Property or the Business;
(f) commence, conduct, defend, compromise, settle,
discontinue or submit to arbitration any proceedings,
claims, questions or disputes in connection with the
Mortgaged Property, the Business or this deed;
(g) prove any debt or liability owed to the Mortgagor in
the bankruptcy, insolvency or winding up of any person
and receive dividends and assent to any proposal for a
composition or scheme of arrangement;
(h) exercise the rights of the Mortgagor in connection
with the Mortgaged Property or the Business;
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(i) perform obligations of the Mortgagor in connection
with the Mortgaged Property and the Business under this
deed or otherwise;
(j) renew, terminate, repudiate, rescind, vary, accept
surrenders of and exercise rights under any contract or
arrangement entered into by the Mortgagor, any
predecessor in title or the Mortgagee (pursuant to the
powers in this deed or at general law) in connection
with the Mortgaged Property or the Business;
(k) renew, allow to lapse, surrender or vary the
conditions of any licence held in connection with the
Mortgaged Property or the Business;
(l) deal in any way with the Mortgaged Property, any
estate or interest in it, any right attaching to it or
any encumbrance affecting it;
(m) sell, surrender, dispose of, realise or convert into
money the Mortgaged Property on any terms and in any
manner;
(n) grant upon any terms and in any manner an option to
purchase, lease or acquire an interest in the Mortgaged
Property;
(o) grant upon any terms and in any manner leases,
licenses and any other interests in or rights over the
Mortgaged Property or the Business;
(p) in the name and on behalf of the Mortgagor or
otherwise, borrow or obtain any form of financial
accommodation upon any terms in connection with the
exercise of any power under this deed or at general law;
(q) secure upon any terms and in any manner any money
borrowed or liability incurred by charge or mortgage
over the Mortgaged Property whether ranking in priority
to, equally with or after this deed;
(r) demolish, replace, repair, alter, or develop,
enlarge or construct any Mortgaged Property;
(s) in the name of the Mortgagor or otherwise acquire,
take on lease or licence, hire or invest in any property
upon any terms and in any manner for use in connection
with the Mortgaged Property or the Business and in the
name of the Mortgagor or otherwise grant a mortgage or
charge over the acquired property to the
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Mortgagee as security for the Secured Money;
(t) change the use or nature of any Mortgaged Property
or any title to any Mortgaged Property;
(u) draw, accept, make and endorse any negotiable
instrument;
(v) make calls, enforce payment of any call which is
payable and unpaid and otherwise get in the capital of
the Mortgagor;
(w) take up any rights issue or offer arising in
connection with the Mortgaged Property;
(x) promote the formation of companies to acquire any
Mortgaged Property or Business or assume any obligations
of the Mortgagor;
(y) delegate in any manner any of its powers and rights
under this deed or at general law;
(z) upon any terms and in any manner employ and
terminate the employment of persons and engage and
terminate the engagement of agents, contractors,
consultants, advisers, auctioneers and other persons in
connection with its powers under this deed or at
general law;
(aa) expend money, assume obligations and incur
liabilities in connection with any power under this deed
or at general law; and
(bb) do anything else in Australia and elsewhere the
Mortgagee considers necessary, desirable or convenient
to be done in connection with the recovery of Secured
Money and anything incidental or conducive to the
exercise of any other power under this deed or general
law.
12.4 EXERCISE OF POWERS BY AGENT
The Mortgagee may exercise its powers under this deed or general law by
itself or through any agent. The fees charged by any agent must be paid
by the Mortgagor.
13. APPOINTMENT OF RECEIVERS
13.1 APPOINTMENT, REMOVAL AND REPLACEMENT
13.1.1 Following the occurrence of an Event of Default, the
Mortgagee may appoint one or more persons to be jointly,
severally or jointly
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and severally Receiver of any Mortgaged Property.
13.1.2 The Mortgagee may appoint a Receiver under this deed
notwithstanding the bankruptcy or insolvency of the
Mortgagor.
13.1.3 The Mortgagee may appoint any person to replace any
Receiver who has been removed or who has retired or
died.
13.1.4 The Mortgagee may by written notice to a Receiver remove
that Receiver absolutely or in relation to any part of
the Mortgaged Property.
13.2 RECEIVER'S REMUNERATION
13.2.1 The Mortgagee may fix the remuneration of a Receiver and
at any time by agreement with that Receiver vary that
Receiver's remuneration.
13.2.2 The Mortgagor must pay and a Receiver may retain out of
money received by him or her his or her remuneration and
(except where they arise because of the wilful
misconduct or gross negligence of the Receiver) the
costs, charges and expenses incurred by that Receiver as
receiver and money on account of other liabilities
incurred actually or contingently by that Receiver as
receiver.
13.2.3 The Mortgagor must reimburse the Mortgagee any payment
made to a Receiver on account of that Receiver's fees or
any cost or expense incurred by that Receiver.
13.3 RECEIVER AGENT OF THE MORTGAGOR
Unless otherwise prevented by law, a Receiver will be the agent of the
Mortgagor. The Mortgagor agrees to be responsible for each Receiver's
acts and omissions.
13.4 RECEIVER'S POWERS
Subject to any express limitation in his or her appointment, a Receiver
may in his or her discretion exercise the same powers and rights as
those of the Mortgagee under this deed and at general law including,
without limitation, the powers listed in clause 12.3.
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14. PROVISIONS RELATING TO THE MORTGAGEE'S AND RECEIVER'S POWERS
14.1 POWERS ARE IN ADDITION TO STATUTORY POWERS
The powers of the Mortgagee and a Receiver under this deed are to be
construed separately and are independent of and in addition to any other
legal, equitable or statutory powers.
14.2 WAIVER OF STATUTORY NOTICES
To the extent permitted by any legislation, the Mortgagor agrees to
dispense with any notice of or lapse of time before the Mortgagee or a
Receiver may exercise any option, power or right following the
occurrence of any Event of Default including, without limitation, notice
or lapse of time which otherwise might be required pursuant to section
57 of the Real Property Act 1900 or section 111 of the Conveyancing Act
1919.
14.3 PROTECTION OF PURCHASERS
The Mortgagor agrees that any person dealing with the Mortgagee or any
Receiver need not be concerned whether any power of the Mortgagee or
that Receiver has arisen or with the propriety of any transaction
undertaken by the Mortgagee or any Receiver even if it has actual notice
to the contrary.
14.4 SPECIFIC AUTHORITY TO EXERCISE POWERS
The Mortgagor irrevocably and unconditionally authorises the Mortgagee
and any Receiver to exercise its powers under this deed or any
legislation notwithstanding that the Event of Default giving rise to
exercise of such powers may subsequently be deemed never to have
occurred. In such circumstances the Mortgagor:
(a) does not have any claim against the Mortgagee or a
Receiver for trespass or for any loss suffered by the
Mortgagor other than because of fraud or gross
negligence on the part of the Mortgagee or Receiver; and
(b) indemnifies the Mortgagee and any Receiver against
any claim or loss arising other than because of fraud or
gross negligence.
14.5 PROTECTION OF THE MORTGAGEE AND RECEIVER
The Mortgagor agrees that the Mortgagee and any Receiver are not liable
for any loss which may arise because of any omission or delay in the
exercise of any of their respective powers under this deed or any
legislation.
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14.6 MONEY OUTLAID IS SECURED
The Mortgagor must upon demand pay any money outlaid by the
Mortgagee or any Receiver in exercising powers under this deed or
at general law.
14.7 ENTITLEMENT TO CHARGE COMMISSIONS
The Mortgagee and a Receiver (if permitted by the Mortgagee) may,
in addition to any fee or other charge, charge a commission in
connection with the management of and collection of income from
the Mortgaged Property to the extent that those tasks have not
been delegated to an agent.
14.8 THE MORTGAGEE MAY GIVE UP POSSESSION OF MORTGAGED PROPERTY
The Mortgagee may at any time give up possession of the whole or
any part of the Mortgaged Property.
15. POWER OF ATTORNEY
15.1 APPOINTMENT OF ATTORNEY
For valuable consideration, the Mortgagor irrevocably appoints the
Mortgagee, the directors and the secretary of the Mortgagee, any
employee whose title includes the word "manager" and each Receiver
severally its attorneys.
15.2 POWERS EXERCISABLE BY ATTORNEYS
15.2.1 Each attorney appointed under clause 15.1 may in
the name of the attorney or the Mortgagor:
(a) perform any obligation owed by the Mortgagor at
any time to the Mortgagee;
(b) complete any blanks and correct any manifest
errors in this deed or any ancillary document or
agree or give effect to any such completion or
correction and do all things necessary to procure
the registration of this deed as a valid security
with the priority intended by the Mortgagee;
(c) after the occurrence of an Event of Default, do
anything in connection with the Mortgaged Property
which the Mortgagor could do; and
(d) delegate its powers to any person for any
period and revoke such delegation.
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15.3 CONFLICTS OF DUTY
An attorney appointed under clause 15.1 may act notwithstanding
any conflict of duty or a direct or personal interest in the means
or result.
15.4 ATTORNEY'S INDEMNITY AND COSTS
15.4.1 The Mortgagor indemnifies any attorney against any
liability or loss arising from the exercise of any
powers under this deed.
15.4.2 The Mortgagee may indemnify any attorney in
connection with the exercise of its powers and the
Mortgagor must reimburse any money paid pursuant to
any such indemnity.
16. PRESERVATION OF THE MORTGAGEE'S RIGHTS
16.1 GENERAL PRESERVATION OF RIGHTS
This deed is a continuing security for the Secured Money. The
liabilities of the Mortgagor under this deed and the rights of the
Mortgagee, a Receiver or an attorney of the Mortgagor appointed
under this deed are not affected by:
(a) the Mortgagee granting any time or indulgence
to the Mortgagor or another person;
(b) the Mortgagee compounding or compromising with
or wholly or partially releasing any Borrower,
Guarantor or other person;
(c) laches, acquiescence, delay, acts, omissions or
mistakes by the Mortgagee, Receiver or another
person;
(d) the Mortgagee taking, varying, wholly or
partially discharging or otherwise dealing with or
losing or impairing any other security for Secured
Money;
(e) any security for or obligation to pay Secured
Money being or becoming void, voidable or
unenforceable;
(f) any person who was intended to assume any
actual or contingent liability to pay Secured Money
not doing so or not doing so effectively or being
discharged;
(g) any other transaction or arrangement between
the Mortgagee or any other person; or
(h) anything else which might otherwise have such
affect at law or
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in equity.
16.2 NO MERGER
16.2.1 The Mortgagee's right to payment of Secured Money
arising under any other instrument does not merge
with the Mortgagor's undertaking to pay Secured
Money under this deed.
16.2.2 This deed does not merge with or affect any other
security or any judgment or order held at any time
by the Mortgagee.
16.3 NO SUSPENSION OF PAYMENT OBLIGATION
The Mortgagee may demand payment of Secured Money and exercise its
other rights and powers under this deed even if a negotiable
instrument, security, contract or other obligation relating to
Secured Money is still current or has not matured or fallen due.
16.4 COMBINATION OF AND NEW ACCOUNTS
16.4.1 Subject to any express agreement to the contrary,
the Mortgagee may at any time combine any two or
more accounts which the Mortgagor may have with the
Mortgagee and deal with the Mortgagor as if those
two or more accounts had always been the one
account.
16.4.2 The Mortgagee may without notice open up any new
account of the Mortgagor with the Mortgagee and
credit the new account with any credit in any other
account or any new receipts.
16.5 NO COMPETITION
The Mortgagor must not claim or receive the benefit directly or
indirectly of any distribution, dividend or payment in connection
with the winding up or liquidation of any person who also has any
liability in respect of the Secured Money if that would reduce the
amount which the Mortgagee may receive from that other person.
16.6 NO ORDER IN EXERCISE OF SECURITIES
The Mortgagee may exercise its powers under this deed and any
other security held for Secured Money in any order it wishes.
16.7 RE-INSTATEMENT OF THE MORTGAGEE'S RIGHTS
If any claim that a payment, obligation, settlement, transaction,
conveyance or transfer in connection with Secured Money (or money
which would be Secured
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Money if the claim was invalid) is void or voidable under any law
relating to insolvency, bankruptcy or the protection of creditors
is upheld, conceded or compromised:
(a) the Mortgagee is entitled immediately as
against the Mortgagor to the rights in respect of
the Secured Money to which it would have been
entitled if all or part of that payment,
obligation, settlement, transaction, conveyance or
transfer had not taken place; and
(b) the Mortgagor agrees to immediately do any act
or sign any document at the Mortgagee's request to
restore the Mortgagee to any security or guarantee
held by it from the Mortgagor immediately before
that payment, obligation, settlement, transaction,
conveyance or transfer.
17. FURTHER ASSURANCES
17.1 PERFECTION OF SECURITY
The Mortgagor must immediately, upon request by the Mortgagee, do
acts, obtain consents, pay fees and execute deeds and other
documents deemed necessary or desirable by the Mortgagee:
(a) to perfect any mortgage or charge pursuant to
this deed;
(b) to effect any mortgage or charge agreed to be
given pursuant to this deed;
(c) to enable the exercise of the Mortgagee's
rights and powers under this deed;
(d) to effect the security and priority intended by
this deed and the Mortgagee;
(e) to more effectively secure the Mortgaged
Property to the Mortgagee; and
(f) to give the Mortgagee a legal mortgage over any
property (including, without limitation, any Debt)
mortgaged or charged under this deed.
17.2 LAND COMPRISING MORTGAGED PROPERTY
17.2.1 Without limiting clause 17.1, the Mortgagor must at
its cost at the reasonable request of the Mortgagee
immediately execute and procure the registration
of:
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(a) a mortgage over any registered land or
registered dealing at any time comprising Mortgaged
Property; or
(b) a deed of conveyance creating a legal mortgage
over any unregistered land or interest in land at
any time comprising Mortgaged Property.
17.2.2 An instrument required by the Mortgagee pursuant to
clause 17.2.1 will contain such provisions as the
Mortgagee may require.
17.3 ASSIGNMENT OF INCOME AND COMPENSATION
17.3.1 To the extent permitted by law, the Mortgagor
absolutely assigns to the Mortgagee as security for
Secured Money the Mortgagor's right to demand, sue
for, recover and receive:
(a) premiums, rents, licence or other fees under
any lease, licence or other agreement at any time
relating to Mortgaged Property; and
(b) compensation arising at any time in connection
with the Mortgaged Property.
17.3.2 Upon request at any time the Mortgagor must perfect
the assignment referred to in clause 17.3.1 as a
legal assignment.
18. THE MORTGAGEE'S RIGHT TO ASSIGN
18.1 ASSIGNMENT
The Mortgagee may at any time assign or deal in any way with its
interest in Secured Money or its rights under this deed. Provided
the Mortgagor's aggregate liability is not thereby increased it
must, at the request and cost of the Mortgagee, sign any deed or
other document reasonably required by the Mortgagee pursuant to
any such assignment or dealing.
18.2 DISCLOSURE OF INFORMATION
The Mortgagee may, without notice to the Mortgagor, disclose
information relating to the Mortgagor, a Borrower, a Guarantor,
the Mortgaged Property or Secured Money in connection with a
genuine proposal to assign any interest in Secured Money or this
deed.
19. COSTS
19.1 MORTGAGOR TO PAY ALL COSTS
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The Mortgagor must pay to the Mortgagee all costs and expenses
(including legal costs on a full indemnity basis and out of pocket
expenses) incurred by the Mortgagee, a Receiver or any attorney of
the Mortgagor pursuant to clause 15 in connection with:
(a) the preparation, negotiation, stamping,
registration variation, discharge or release of
this deed and any agreement varying or relating to
this deed and any associated investigation,
enquiries and searches;
(b) the recovery of the Secured Money;
(c) the occurrence of an Event of Default and the
assessment of the Mortgagee's securities, rights
and duties;
(d) the exercise or attempted exercise of any power
conferred on the Mortgagee or any Receiver pursuant
to this deed or by law or on any attorney pursuant
to clause 15;
(e) any obligation the Mortgagee has at any time to
the Mortgagor pursuant to any legislation, this
deed or any transaction contemplated by this deed;
(f) the consideration of any application for its
consent or approval in connection with this deed
and the issue or refusal of consent or approval;
and
(g) the assessment of the Mortgagor's position
following the occurrence of an Event of Default.
19.2 MORTGAGOR TO REIMBURSE FID
The Mortgagor must reimburse the Mortgagee all sums of financial
institutions duty and other duties, taxes or imposts incurred or
payable by the Mortgagee in relation to the advance and receipt of
Secured Money.
19.3 MORTGAGOR TO PAY STAMP DUTY
The Mortgagor must pay immediately on demand by the Mortgagee and
in any case by their due date all stamp, mortgage and other
duties, imposts, taxes and levies arising directly or indirectly
in respect of this deed, any variation or any transaction
contemplated or evidenced by this deed. The Mortgagor must
immediately reimburse the Mortgagee any such duties, imposts,
taxes and levies paid by the Mortgagee.
19.4 PAYMENT OF THE MORTGAGEE'S ADMINISTRATION FEE
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The Mortgagor agrees to pay the Mortgagee upon demand a fee for
the time spent by employees of the Mortgagee in:
(a) considering any application for any approval or
consent required under this deed; and
(b) exercising its rights and powers and taking any
action to recover the Secured Money following the
occurrence of an Event of Default.
The fee will be calculated by reference to the hourly rates
recommended by the Insolvency Practitioners Association of
Australia from time to time and the Mortgagee's determination of
the equivalent seniority levels of its employees.
20. GENERAL
20.1 SIGNING OF NOTICES BY THE MORTGAGEE
Any statement, demand or notice to the Mortgagor will be
effectively signed on behalf of the Mortgagee if it is executed or
signed by the Mortgagee, any director or secretary of the
Mortgagee, any employee whose title includes the word "manager",
"president" or "vice-president", the Mortgagee's solicitor or any
person authorised by any of the above.
20.2 SERVICE OF NOTICES
20.2.1 In addition to effecting service pursuant to any
statute, any statement, demand or notice to any
party may be validly served for the purposes of
this deed by being delivered or sent by registered
post to the address of the addressee or sent by
facsimile to the facsimile number of the addressee.
The address and facsimile numbers of the parties
for the purposes of this clause are those set out
in item 1 of Schedule 1 or such others as are from
time to time notified in writing by the parties to
all of the other parties. Service pursuant to this
clause is taken to be effected:
(a) where delivered, upon actual delivery; and
(b) where sent by facsimile, on production of a
transmission report by the machine from which the
facsimile was sent which indicates that the
facsimile was sent in its entirety to the facsimile
number of the recipient,
except where actual delivery is made or the facsimile is sent
after 4.30pm or on a day which is not a business day when service
is taken to be effected at
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9.00am on the next following business day.
20.3 REGISTRATION AND REQUISITIONS
The Mortgagor must upon demand by the Mortgagee procure
registration of this deed and any mortgage or encumbrance given
pursuant to this deed with the priority intended by the Mortgagee.
The Mortgagor must to the satisfaction of the Mortgagee promptly
comply with any requisition raised by any authority in connection
with this deed its stamping and registration.
20.4 NO MORATORIUM
The provisions of any legislation postponing payment of money,
reducing or fixing rates of interest or purporting to curtail or
restrict any rights of the Mortgagee or a Receiver are to the
extent that it is lawful expressly excluded from application to
this deed.
20.5 TIME OF THE ESSENCE FOR MORTGAGOR'S OBLIGATIONS
The Mortgagor agrees that time is of the essence in relation to
the performance of its obligations expressed in or implied by this
deed.
20.6 THE MORTGAGEE'S CONSENTS
20.6.1 Where the Mortgagee's consent or approval is
required pursuant to this deed:
(a) unless otherwise expressed it may in the
Mortgagee's discretion (and whether or not acting
reasonably) be withheld or given subject to terms
or conditions; and
(b) it is not valid unless expressly given in
writing by the Mortgagee.
20.6.2 Any consent given under this deed is not deemed to
be consent in the context of any other agreement.
Nothing in this deed can require the Mortgagee to
give its consent in the context of any other
agreement.
20.6.3 The Mortgagor must comply with the terms and
conditions of any consent.
20.6.4 The Mortgagee may engage consultants and advisers
to advise it in relation to any application for its
approval or consent under this deed. The costs of
those consultants and advisers must be reimbursed
by the Mortgagor upon demand.
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20.6.5 The Mortgagor agrees that the Mortgagee (and the
Mortgagee's employees and consultants) owes no
duty of care to the Mortgagor in issuing any
consent or approval and that in determining
whether to proceed with the thing consented to or
approved the Mortgagor must rely entirely on its
own judgment and the advice of its own employees
and consultants.
20.7 SURVIVAL OF PERSONAL COVENANTS AND AGREEMENTS
Any personal covenant or agreement by the Mortgagor to pay Secured
Money or any indemnity by the Mortgagor in favour of the Mortgagee
in this deed remains in full force despite any release or discharge
of the whole or any part of the Mortgaged Property.
20.8 SEVERABILITY OF PROVISIONS
Every provision of this deed is independent of the others. Any
provision which is prohibited or unenforceable in any jurisdiction
is to the extent of the prohibition or unenforceability deemed
removed without invalidating the remaining provisions.
20.9 APPLICABLE LAW
This deed is governed by the law of New South Wales. The parties
irrevocably and unconditionally submit to the non-exclusive
jurisdiction of the New South Wales court system.
20.10 MAXIMUM PROSPECTIVE LIABILITY
20.10.1 For the purposes of the priority rules in section
282 of the Corporations Law this deed secures a prospective
liability up to the maximum amount specified in item 2 of
Schedule 1 in addition to any present liability.
20.10.2 For so long as there is no other charge over any
Mortgaged Property registered subsequently to this deed,
this deed also secures an additional prospective liability
of an unlimited amount.
20.10.3 Where there is another charge over any Mortgaged
Property registered subsequently to this deed, to the
extent that the priority accorded to this deed pursuant to
section 282 of the Corporations Law and clause 20.10.1 is
not adversely affected this deed also secures an additional
prospective liability of an unlimited amount.
SCHEDULE
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ITEM 1 SERVICE OF NOTICES
MORTGAGOR
Address: Level 1, 13-15 Bridge Street, Sydney, New South Wales
Fax No: (02) 9360 5770
MORTGAGEE
Principal Healthcare Finance Pty Limited
Attention: Bill Chapman/Robert Tobias
Address: c/o Phillips Fox, Level 12, 255 Elizabeth Street,
Sydney, New South Wales
Fax No: (02) 9283 4144
AND TO
Omega (UK) Ltd
Attention: John Storey
Address: 145 Cannon Street, London, EC4N 5BT
Fax No: 0011 44 171 929 3555
AND TO
Omega Healthcare Investors, Inc.
Attention: Essel Bailey
Address: 900 Victors Way, Suite 345, Ann Arbor, Michigan 48108, USA
Fax No: 0011 1 734 887-0301
ITEM 2 MAXIMUM PROSPECTIVE LIABILITY
$25,000,000.00
ITEM 3 - FACILITY
The Logan Nursing Home located at 271 Middle Road, Greenbank, Queensland (being
the land more particularly described as Lot 2 in Survey Plan 103669, Title
Reference 50239805).
<PAGE> 280
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EXECUTED AS A DEED
Executed by PENDER BROS PTY LTD by:
.................................. ....................... ................
Signature of authorised person Signature of authorised person
.................................. ................. ......................
Office held Office held
.................................. ................. ......................
Name of authorised person Name of authorised person
(print) (print)
<PAGE> 281
CONTENTS
<TABLE>
<CAPTION>
<S> <C> <C>
1. DEFINITIONS AND INTERPRETATION ...................................... 1
1.1 Definitions ......................................................... 1
1.2 Interpretation ...................................................... 3
1.3 Joint and several ................................................... 4
1.4 Successors and assigns .............................................. 4
1.5 Headings and table of contents ...................................... 5
1.6 References to and calculations of time .............................. 5
1.7 Corporate relationships ............................................. 5
1.8 Defined terms from the Lease ........................................ 5
2. CHARGE AND ITS NATURE ............................................... 6
2.1 Charge .............................................................. 6
2.3 Title documents ..................................................... 6
2.4 Fixed charge ........................................................ 6
2.5 Floating charge ..................................................... 6
2.6 Dealings with Mortgaged Property subject to
floating charge ..................................................... 6
2.7 Conversion of floating charge to fixed charge ....................... 6
2.8 Crystallisation of floating charge .................................. 7
2.9 De-crystallisation .................................................. 7
3. PERFORMANCE OF MORTGAGOR'S OBLIGATIONS GENERALLY .................... 7
3.1 Performance of all obligations ...................................... 7
3.2 The Mortgagee's right to remedy ..................................... 8
4. PAYMENT OF SECURED MONEY ............................................ 8
4.1 Time for payment .................................................... 8
4.2 No pre-condition to demanding payment of the
Secured Money ....................................................... 8
4.3 Payment following an Event of Default ............................... 8
4.4 Payment without deduction or set-off ................................ 8
4.5 Credit for payment .................................................. 8
4.6 Application of payments ............................................. 9
4.7 Place for payment of money .......................................... 9
4.8 Set-off against other accounts ...................................... 9
4.9 Overpayment ......................................................... 10
4.10 Payment in wrong currency ........................................... 10
4.11 Interest ............................................................ 10
5. INSURANCE OBLIGATIONS ............................................... 10
5.1 Insurance of Mortgaged Property ..................................... 10
5.2 Public risk and other insurances .................................... 11
5.3 General insurance obligations ....................................... 11
5.4 Assignment of insurance proceeds .................................... 11
6. UNDERTAKINGS RELATING TO THE MORTGAGOR'S BUSINESS
AND ASSETS ......................................................... 12
6.1 Carrying on the Business ............................................ 12
6.2 Repair and security ................................................. 12
6.3 Replacement of damaged or destroyed property ........................ 12
</TABLE>
<PAGE> 282
<TABLE>
<CAPTION>
<S> <C> <C>
6.4 Performance of all lease obligations .......................................... 12
6.5 Compliance by Moran Australia and Moran Group with
the Capex Agreement ........................................................... 13
6.6 Maintenance of books and accounts ............................................. 13
6.7 Environmental risk management ................................................. 13
7. NEGATIVE COVENANTS ............................................................ 14
7.1 Prohibition on dealing with the Mortgaged Property ............................ 14
7.2 Prohibition on dealings with Debts ............................................ 14
7.3 Prohibition on acts prejudicial to the Mortgagee's
security ...................................................................... 15
7.4 Prohibitions in relation to the Business ...................................... 15
7.5 Prohibition relating to capital ............................................... 15
7.6 Other prohibitions not to be affected ......................................... 15
8. PROVISIONS APPLYING TO A TRUSTEE MORTGAGOR .................................... 15
8.1 Application of clause 8 ....................................................... 15
8.2 Warranties relating to the Trust .............................................. 15
8.3 Specific prohibitions relating to the Trust ................................... 16
8.4 Financial information ......................................................... 16
8.5 Mortgagor's right of indemnity ................................................ 17
8.6 New trustees .................................................................. 17
8.7 Mortgagor's liability unlimited ............................................... 17
9. WARRANTIES AND INDEMNITIES .................................................... 17
9.1 Warranties .................................................................... 17
9.2 Indemnities ................................................................... 18
10. PROVISION OF INFORMATION AND ACCESS FOR THE
MORTGAGEE ..................................................................... 19
10.1 Access to the Business and Mortgaged Property ................................. 19
10.2 Notification of matters to the Mortgagee ...................................... 19
11. EVENT OF DEFAULT .............................................................. 20
11.1 Mortgagor to prevent Event of Default ......................................... 20
11.2 Event of Default .............................................................. 20
11.3 No default certificate ........................................................ 24
11.4 Report by qualified accountant ................................................ 24
12. THE MORTGAGEE'S POWERS FOLLOWING EVENT OF DEFAULT ............................. 24
12.1 Exercise of powers generally .................................................. 24
12.2 Termination of transactions and payment of prior
mortgagees .................................................................... 25
12.3 The Mortgagee's general powers ................................................ 25
12.4 Exercise of powers by agent ................................................... 27
13. APPOINTMENT OF RECEIVERS ...................................................... 27
13.1 Appointment, removal and replacement .......................................... 27
13.2 Receiver's remuneration ....................................................... 28
13.3 Receiver agent of the Mortgagor ............................................... 28
13.4 Receiver's powers ............................................................. 28
14. PROVISIONS RELATING TO THE MORTGAGEE'S AND
RECEIVER'S POWERS ............................................................. 28
14.1 Powers are in addition to statutory powers .................................... 28
</TABLE>
<PAGE> 283
<TABLE>
<CAPTION>
<S> <C> <C>
14.2 Waiver of statutory notices ......................................... 29
14.3 Protection of purchasers ............................................ 29
14.4 Specific authority to exercise powers ............................... 29
14.5 Protection of the Mortgagee and Receiver ............................ 29
14.6 Money outlaid is secured ............................................ 29
14.7 Entitlement to charge commissions ................................... 29
14.8 The Mortgagee may give up possession of Mortgaged
Property ............................................................ 30
15. POWER OF ATTORNEY ................................................... 30
15.1 Appointment of attorney ............................................. 30
15.2 Powers exercisable by attorneys ..................................... 30
15.3 Conflicts of duty ................................................... 30
15.4 Attorney's indemnity and costs ...................................... 30
16. PRESERVATION OF THE MORTGAGEE'S RIGHTS ............................. 31
16.1 General preservation of rights ...................................... 31
16.2 No merger .......................................................... 31
16.3 No suspension of payment obligation ................................. 31
16.4 Combination of and new accounts ..................................... 32
16.5 No competition ...................................................... 32
16.6 No order in exercise of securities .................................. 32
16.7 Re-instatement of the Mortgagee's rights ............................ 32
17. FURTHER ASSURANCES .................................................. 32
17.1 Perfection of security .............................................. 32
17.2 Land comprising Mortgaged Property .................................. 33
17.3 Assignment of income and compensation ............................... 33
18. THE MORTGAGEE'S RIGHT TO ASSIGN ..................................... 34
18.1 Assignment .......................................................... 34
18.2 Disclosure of information ........................................... 34
19. COSTS ............................................................... 34
19.1 Mortgagor to pay all costs .......................................... 34
19.2 Mortgagor to reimburse FID .......................................... 35
19.3 Mortgagor to pay stamp duty ......................................... 35
19.4 Payment of the Mortgagee's administration fee ....................... 35
20. GENERAL ............................................................. 35
20.1 Signing of notices by the Mortgagee ................................. 35
20.2 Service of notices .................................................. 35
20.3 Registration and requisitions ....................................... 36
20.4 No moratorium ....................................................... 36
20.5 Time of the essence for Mortgagor's obligations ..................... 36
20.6 The Mortgagee's consents ............................................ 36
20.7 Survival of personal covenants and agreements ....................... 37
20.8 Severability of provisions .......................................... 37
20.9 Applicable law ...................................................... 37
20.10 Maximum prospective liability ....................................... 37
SCHEDULE ..................................................................... 38
</TABLE>
<PAGE> 284
DEED OF FIXED AND FLOATING CHARGE
(securing all money owing at any time as a
principal debtor or guarantor)
PRINCIPAL HEALTHCARE FINANCE PTY LIMITED
PENDER BROS PTY LTD
[PHILLIPS FOX LAWYERS LOGO]
<PAGE> 285
-1-
DEED OF GUARANTEE AND INDEMNITY
THIS DEED IS MADE ON NOVEMBER 12 1998
PARTIES
PENDER BROS PTY LTD, ACN 000 003 556 of Level 1, 13-15 Bridge Street, Sydney NSW
2000 ("GUARANTOR")
PRINCIPAL HEALTHCARE FINANCE PTY LIMITED, ACN 069 875 476 of Level 12, 255
Elizabeth Street, Sydney, New South Wales, Australia in its own capacity and as
trustee of the Principal Healthcare Finance Trust ("PHF")
AGREEMENTS BETWEEN THE PARTIES
1. DEFINITIONS AND INTERPRETATION
1.1. DEFINITIONS
In this deed:
Borrower means collectively and individually the persons named as
such in the Schedule;
Capex Agreement means the capital contribution agreement PHF
and the Borrower dated on or around the date of this deed;
Guaranteed Money means all money which at any time under the
Capex Agreement:
(a) is actually or contingently owing or remains unpaid; or
(b) may, because of a then existing arrangement or
circumstance, become actually or contingently owing
in the future,
to PHF by the Borrower in any capacity and whether alone or
jointly or jointly and severally with others;
Lease means the lease of amongst other things, real property
between Moran and PHF dated on or around the date of this
deed;
Trust means any trust or settlement as trustee of which the
Guarantor has entered into this deed; and
Trust Deed means, in relation to a Trust, the instrument
setting out all the terms currently governing that Trust.
1.2. INTERPRETATION
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1.2.1. A reference to:
1.2.1.1. a person includes the trustee, executor or
administrator of that person;
1.2.1.2. PHF includes any assignee;
1.2.1.3. a group of persons (including the Guarantor if
more than 1 person) includes any one or more of them;
1.2.1.4. any thing or amount is a reference to the whole
and each part of it; and
1.2.1.5. a clause or schedule is a reference to a clause
of or schedule to this deed.
1.2.2. Unless the context otherwise requires, a word which
denotes:
1.2.2.1. the singular includes the plural and vice versa;
1.2.2.2. any gender includes the other gender; and
1.2.2.3. a person includes an individual, a body corporate
and a government.
1.3. JOINT AND SEVERAL
Any agreement, warranty, representation or obligation which
binds or benefits 2 or more persons under this deed binds or
benefits those persons jointly and severally.
1.4. HEADINGS AND TABLE OF CONTENTS
Headings and the table of contents must be ignored in the
interpretation of this deed.
1.5. DEFINED TERMS FROM THE LEASE
Words which have a defined meaning in the Lease have the same
meaning when used in this deed unless the same word is also
defined in this deed, in which case the definition in this
deed prevails to the extent of the inconsistency.
2. GUARANTEE AND INDEMNITY
2.1. UNCONDITIONAL GUARANTEE
The Guarantor unconditionally and irrevocably guarantees the
punctual payment of Guaranteed Money to PHF. The Guarantor
must upon demand immediately pay PHF any amount of Guaranteed
Money not paid by the Borrower on its due date. The Guarantor
must not delay payment because
<PAGE> 287
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any negotiable instrument relating to Guaranteed Money has not
matured.
2.2. UNCONDITIONAL INDEMNITY
The Guarantor unconditionally and irrevocably indemnifies PHF
against all losses, damages, costs, charges, liabilities and
expenses which PHF may at any time suffer or incur directly or
indirectly because:
2.2.1 it does not for any reason recover from the Borrower
any Guaranteed Money or any money which would be
Guaranteed Money but for:
2.2.1.1 the fact that any agreement between
PHF and the Borrower or another
person is void, voidable or wholly
or partially unenforceable; or
2.2.1.2 any release of the Borrower;
2.2.2 PHF has to disgorge any money paid to or received by
it and credited against Guaranteed Money;
2.2.3 the Borrower or the Guarantor fails to pay any Guaranteed
Money when payable;
2.2.4 the occurrence of any event or circumstance entitling
PHF to demand payment of money from the Borrower
earlier than the time it would otherwise have become
payable;
2.2.5 PHF exercises or attempts to exercise any power or
right in relation to the recovery of any Guaranteed
Money;
2.2.6 PHF seeks to recover any Guaranteed Money from any
other person liable to pay; or
2.2.7 a warranty in this deed is incorrect in any respect; or
2.2.8 the rate of interest applying to any judgment debt is
less than that applying to the original obligation to
pay Guaranteed Money in respect of which a judgment
was obtained.
The Guarantor must upon demand immediately pay PHF any amount
of loss, damage, cost, charge, liability or expense so
indemnified.
2.3. LIMITATION OF LIABILITY
The Guarantor's guarantee in clause 2.1 and indemnity in
clause 2.2 are in respect of the whole of the Guaranteed
Money. However, the Guarantor's liability under clause 2.1 and
2.2 is in aggregate limited to $5,000,000.00 plus any interest
payable on that amount and any costs or expenses of any nature
whatsoever incurred by PHF under or in connection with this
deed or any associated security.
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2.4. RELEASE
PHF will release the Guarantor from its obligations under this
deed upon the earlier of:
2.4.1 the Borrower performing all its obligations under the
Capex Agreement; and
2.4.2 the Borrower performing all of its obligations under the
Lease.
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3. PAYMENT OF GUARANTEED MONEY
3.1. PAYMENT WITHOUT DEDUCTION
The Guarantor must pay money owing under this deed in
immediately available funds without any deduction. The
Guarantor irrevocably and unconditionally waives any right of
set-off or counter-claim in relation to any money owing by it
under this deed and any right to rely on any defence available
to the Borrower.
3.2. COMBINATION OF ACCOUNTS
The Guarantor authorises PHF without notice and in its
discretion to apply credit balances in any account of the
Guarantor with PHF towards satisfaction of any amount then
payable by the Guarantor under this deed.
3.3. APPLICATION OF PAYMENTS
3.3.1. The Guarantor irrevocably waives its right to
determine the appropriation of any money paid to PHF.
All payments of Guaranteed Money may be applied in
the absolute discretion of PHF towards reduction or
satisfaction of that part of the Guaranteed Money
which PHF elects. Payment of Guaranteed Money may be
credited by PHF to a suspense account and
appropriated to Guaranteed Money in its discretion.
3.3.2. PHF is under no obligation to appropriate the
proceeds of any security to payment of Guaranteed
Money before payment of any other money secured by
that security.
3.4. INTEREST ON GUARANTEED MONEY
3.4.1. Subject to clause 3.4.2, the Guarantor must upon
demand pay PHF interest calculated daily at the
Overdue Rate on any money owing pursuant to this deed
from the date it is demanded to the date it is paid.
3.4.2. The Guarantor is not required to pay interest on an
amount of Guaranteed Money which, pursuant to an
agreement between the Borrower and PHF, is bearing
interest where that interest is itself Guaranteed
Money.
4. GENERAL GUARANTEE PROVISIONS
4.1. GUARANTOR TO MAKE ENQUIRIES
The Guarantor agrees that:
4.1.1 in entering into this deed, it has relied exclusively
upon its own knowledge and enquiries of the Borrower
and the Borrower's
<PAGE> 290
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proposed transactions with PHF; and
4.1.2 PHF is not at any time required to provide the
Guarantor with any information relating to the
Borrower, any other Guarantor or any existing or
proposed transaction with the Borrower.
4.2. GUARANTOR'S OBLIGATIONS TO CONTINUE UNAFFECTED
4.2.1. The obligations and liabilities of the Guarantor and
the rights of PHF under this deed continue in respect
of all money which is or becomes Guaranteed Money and
are not affected by:
4.2.1.1. PHF granting any time, waiver or other indulgence
to the Borrower, any Guarantor or another person;
4.2.1.2. PHF consenting to any scheme of
arrangement or assignment for the
benefit of creditors by the Borrower
or compounding or compromising with
or wholly or partially releasing or
covenanting not to sue the Borrower
or another person;
4.2.1.3. laches, acquiescence, delay, acts, omissions or
mistakes by PHF or another person;
4.2.1.4. PHF taking, varying, wholly or
partially discharging or otherwise
dealing with or losing or impairing
any security for Guaranteed Money;
4.2.1.5. any security for or obligation to pay
Guaranteed Money being or becoming void, voidable
or unenforceable;
4.2.1.6. any person who was intended to assume liability
to pay Guaranteed Money not doing so or not
doing so effectively or being discharged;
4.2.1.7. the novation, assignment, rescission, termination
or variation of any contract or arrangement
between PHF and the Borrower or another person;
4.2.1.8. any other transaction or arrangement between PHF
and the Borrower or another person;
4.2.1.9. any change in the constitution of the Borrower
including the Borrower becoming a company,
partnership or sole trader;
4.2.1.10. any change in the ownership or status of any
corporate Borrower or Guarantor or any change in
the partners of a partnership Borrower or
Guarantor;
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4.2.1.11. the death, mental illness or bankruptcy of any
individual Borrower or Guarantor;
4.2.1.12. the insolvency or deregistration of any
corporate Borrower or Guarantor;
<PAGE> 292
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4.2.1.13. (where the Borrower or a Guarantor is a trustee)
any breach of trust or any limitation on the
trustee's indemnity or the trust assets available
to satisfy the indemnity; or
4.2.1.14. anything else which might at law or in equity
have the effect of prejudicing or discharging the
Guarantor's liability under this deed.
4.2.2. Where a person who is named as a Guarantor:
4.2.2.1. fails to execute or become bound by this deed; or
4.2.2.2. ceases for any reason to have any liability or
continuing liability under this deed including,
without limitation, pursuant to a release by,
concession from or compromise with PHF,
the remaining Guarantors continue to be bound by this
deed for all Guaranteed Money notwithstanding clause
1.3.
4.3. INCREASES IN GUARANTEED MONEY
Without limiting clause 4.2.1, the Guarantor agrees that PHF
may, without notice to or the consent of the Guarantor, deal
with the Borrower or another person in any manner and that
Guaranteed Money may increase pursuant to any such dealing.
4.4. DISCRETION IN ENFORCING SECURITIES
The Guarantor agrees that PHF may enforce this deed
irrespective of whether it has made a demand on the Borrower
or has enforced any other security for Guaranteed Money. The
Guarantor waives any right to require the marshalling of any
securities held by PHF for the Guaranteed Money.
4.5. NO MERGER
PHF's right to payment of Guaranteed Money arising under any
other instrument does not merge with the Guarantor's
obligation to pay Guaranteed Money under this deed. This deed
does not merge with or affect any other security or agreement
or any judgment or order held at any time by PHF.
4.6. GUARANTOR'S SECURITY FROM BORROWER TO PHF
The Guarantor agrees to hold any indemnity (together with any
security for that indemnity) from the Borrower in respect of
its liability under this deed in trust for PHF.
4.7. DISCHARGE OF GUARANTOR'S SECURITIES
<PAGE> 293
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Subject to clause 2.4, the Guarantor is not entitled to the
discharge of any security which secures its obligations under
this deed until:
4.7.1 all Guaranteed Money (irrespective of whether amounts are
ascertainable); and
4.7.2 all other money actually or contingently owing under
this deed or that security, has been paid to PHF and the
Guarantor has provided evidence to PHF's reasonable
satisfaction that no money will become owing pursuant to
clause 2.2(b).
4.8. WARRANTY AS TO GUARANTOR'S UNDERSTANDING AND VALIDITY
The Guarantor warrants to PHF that:
4.8.1 this deed is in all respects valid and binding on the
Guarantor and enforceable in accordance with its
terms;
4.8.2 where the Guarantor is a company, there is
justifiable commercial benefit to it in giving this
guarantee and indemnity; and
4.8.3 the Guarantor is solvent.
5. INSOLVENCY OF BORROWER OR GUARANTOR
5.1. GUARANTOR NOT TO PROVE IN COMPETITION
The Guarantor must not, without PHF's prior written consent:
5.1.1 other than by its attorney appointed pursuant to
clause 5.2, prove in the bankruptcy or insolvency of
the Borrower or any other Guarantor or claim or
receive the benefit of any dividend, distribution or
other payment pursuant to that bankruptcy or
insolvency; or
5.1.2 claim the benefit of any right, power, remedy or security
held by PHF,
until the Guaranteed Money and all other money owing under this
deed has been paid in full to PHF.
5.2. PHF AS GUARANTOR'S ATTORNEY
For valuable consideration, each Guarantor irrevocably
appoints PHF and the persons who are at any time a director,
secretary or employee whose title includes the word "manager"
of PHF severally its attorneys with power:
5.2.1 in the name of the Guarantor, to do anything the
Guarantor can do in connection with the bankruptcy or
insolvency of a Borrower or another
<PAGE> 294
-10-
Guarantor;
5.2.2 in the name of the Guarantor, to exercise any security
referred to in clause 4.6;
5.2.3 where clause 6 applies, to do anything in exercise of
any right of indemnity referred to in clause 6.5 or to
enable direct access or recourse to trust assets for
the purposes of the right referred to in clause 6.6;
5.2.4 to apply any money received in payment of money owing
under this deed; and
5.2.5 to delegate its powers to any person for any period.
An attorney may delegate and exercise any of these powers
notwithstanding any conflict of duty or interest in the
outcome.
6. PROVISIONS APPLYING TO A TRUSTEE GUARANTOR
6.1. APPLICATION OF CLAUSE 6
Clause 6 applies where a Guarantor has entered into this deed
as trustee of a trust. References in clause 6 to the Guarantor
are to each Guarantor who has entered into this deed as
trustee of a trust.
6.2. WARRANTIES RELATING TO THE TRUST
The Guarantor warrants to PHF that:
6.2.1 a true and complete copy of the Trust Deed has been
supplied to PHF's solicitors;
6.2.2 the Trust is validly created and subsisting and no
circumstances exist pursuant to which it may be
determined and no date for the vesting of any of the
Trust fund has been appointed other than as may be
set out in the Trust Deed;
6.2.3 the Guarantor is validly appointed as the only
trustee of the Trust, is not in breach of its
obligations as trustee and no circumstances exist
pursuant to which it may be removed;
6.2.4 this deed and any security given over Trust assets
for the Guarantor's obligations under this deed is
duly executed and granted pursuant to and in proper
exercise of the powers of the Guarantor as trustee of
the Trust and all formalities required by the Trust
Deed in connection with this deed and any such
security have been complied with;
6.2.5 the execution and performance of this deed and any
security given over Trust assets for the Guarantor's
obligations under this deed is a
<PAGE> 295
-11-
proper purpose of the Trust and provides a valuable
commercial benefit to the Trust;
6.2.6 the Guarantor is entitled to be fully indemnified out
of the assets of the Trust in respect of its
liability under this deed;
6.2.7 the Guarantor is the legal owner of all the assets of
the Trust;
6.2.8 there is no dispute between the Guarantor and any other
person in relation to the Trust or the Trust assets; and
6.2.9 there is nothing relating to the Trust which has not
been disclosed to PHF and which might, if disclosed,
reasonably be expected to affect PHF's decision to
enter into any transaction with a Borrower or to rely
on this deed.
6.3. SPECIFIC PROHIBITIONS RELATING TO THE TRUST
The Guarantor must not, without PHF's consent:
6.3.1 cease to be the sole trustee of the Trust;
6.3.2 cause or permit the Trust to be determined or a vesting
date to be appointed;
6.3.3 do or permit anything which adversely affects the
Guarantor's right of indemnity against the Trust
assets;
6.3.4 in any way vary the Trust Deed or permit it to be varied;
6.3.5 distribute or dispose of any Trust assets; or
6.3.6 delegate any powers of the Guarantor as trustee of
the Trust or exercise any power of appointment.
6.4. FINANCIAL INFORMATION
The Guarantor must at any time at the request of PHF provide
full financial and other details of the Trust.
6.5. GUARANTOR'S RIGHT OF INDEMNITY
Without limiting any other right PHF may have, the Guarantor
assigns to PHF the Guarantor's right of indemnity against
Trust assets in respect of the payment of money owing at any
time pursuant to this deed.
6.6. PHF TO HAVE DIRECT ACCESS TO TRUST ASSETS
The Guarantor grants PHF direct access and recourse to the
Trust assets to satisfy the Guarantor's obligations under this
deed. This right is separate and independent to PHF's other
rights including, without limitation, its right under
<PAGE> 296
-12-
clause 6.5.
6.7. NEW TRUSTEES
The Guarantor must procure that any person who becomes a
trustee of the Trust (whether in replacement of or in addition
to the Guarantor) enters into a deed with PHF whereby it
agrees to perform the obligations of the Guarantor under this
deed.
6.8. GUARANTOR'S LIABILITY UNLIMITED
The Guarantor's liability pursuant to this deed is not limited or
otherwise affected by the Guarantor being trustee of the Trust,
by the extent of the Guarantor's ability to indemnify itself out
of the assets of the Trust or by any right granted to PHF in
respect of Trust assets.
7. GENERAL
7.1. COSTS AND STAMP DUTY
7.1.1. The Guarantor must pay PHF's legal costs (on a full
indemnity basis) in respect of this deed, anything
done in connection with this deed including, without
limitation, the recovery of any money under it or
under any agreement with the Borrower giving rise to
or securing Guaranteed Money.
7.1.2. The Guarantor must pay all stamp and other duties
payable in relation to this deed, any transaction
entered into in connection with this deed and the
receipt of any Guaranteed Money by PHF.
7.2. SIGNING AND SERVING OF CERTIFICATES, DEMANDS AND NOTICES
7.2.1. Any certificate, demand or notice by PHF pursuant to
this deed may be signed by an officer or employee of
PHF and any solicitor acting for PHF.
7.2.2. A certificate, demand or notice may be served by PHF
on the Guarantor by delivery or facsimile to the
Guarantor's address or facsimile numbers set out in
the schedule or any other address from which the
Guarantor carries on business or at which the
Guarantor lives or (where the Guarantor is a company)
at which its registered office is situated and any
facsimile number of a machine located at such other
address.
7.2.3. Service pursuant to this clause is taken to be effected:
7.2.3.1. where delivered, upon actual delivery; and
7.2.3.2. where sent by facsimile, on production of a
transmission report by the machine from which the
facsimile was sent which indicates that the
facsimile was sent in its entirety
<PAGE> 297
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to the facsimile number of the recipient,
except where actual delivery is made or the facsimile
is sent after 4.30pm or on a day which is not a
business day. In such cases, service will be deemed
to have been effected at 9:00 am on the immediately
following business day.
7.2.4. Any certificate by PHF of an amount owing or payable
by the Guarantor under this deed is prima facie
evidence that the amount stated is owing or payable
by the Guarantor.
7.3. WAIVERS AND VARIATIONS
The Guarantor agrees that, notwithstanding any representation
made at any time, a waiver in connection with or variation of
this deed is only binding on PHF if signed by PHF (under seal
if a company) or any attorney duly appointed and authorised in
writing.
<PAGE> 298
-14-
7.4. SEVERABILITY OF PROVISIONS
Every provision of this deed is independent of the others. Any
provision which is prohibited or unenforceable in any
jurisdiction is, to the extent of the prohibition or
unenforceability, deemed removed without invalidating the
remaining provisions.
7.5. APPLICABLE LAW
This deed is governed by the law of New South Wales. The
parties irrevocably and unconditionally submit to the
non-exclusive jurisdiction of the New South Wales court
system.
<PAGE> 299
- 15 -
SCHEDULE
BORROWER
Name:
Moran Health Care (Australia) Pty Limited, ACN 082 466 457
Address:
Level 1, 13-15 Bridge Street, Sydney NSW 2000
Fax No:
Name: Moran Health Care Group Pty Limited, ACN 008 585 242
Address: Level 1, 13-15 Bridge Street, Sydney NSW 2000
Fax No:
<PAGE> 300
-16-
EXECUTED AS A DEED
Executed by PENDER BROS PTY LTD by:
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Signature of authorised person Signature of authorised person
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Office held Office held
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Name of authorised person (print) Name of authorised person (print)
<PAGE> 301
- 17 -
DEED OF GUARANTEE AND INDEMNITY
PENDER BROS PTY LTD
PRINCIPAL HEALTHCARE FINANCE PTY LIMITED
[GRAPHIC OMITTED]
255 Elizabeth Street Sydney NSW 2000 Australia
Tel +61 2 9286 8000 Fax +61 2 9283 4144 DX 107 SYDNEY
Email: [email protected] WWW site:
http://www.PhillipsFox.com.au
Ref: WGC965155KUN
<PAGE> 302
CONTENTS
1. DEFINITIONS AND INTERPRETATION
1.1 Definitions.........................................................
1.2 Interpretation......................................................
1.3 Joint and several...................................................
1.4 Headings and table of contents......................................
1.5 Defined terms from the Lease........................................
2. GUARANTEE AND INDEMNITY
2.1 Unconditional guarantee.............................................
2.2 Unconditional indemnity.............................................
2.3 Limitation of liability.............................................
2.4 Release.............................................................
3. PAYMENT OF GUARANTEED MONEY
3.1 Payment without deduction...........................................
3.2 Combination of accounts.............................................
3.3 Application of payments.............................................
3.4 Interest on Guaranteed Money........................................
4. GENERAL GUARANTEE PROVISIONS
4.1 Guarantor to make enquiries.........................................
4.2 Guarantor's obligations to continue unaffected......................
4.3 Increases in Guaranteed Money.......................................
4.4 Discretion in enforcing securities..................................
4.5 No merger...........................................................
4.6 Guarantor's security from Borrower to PHF...........................
4.7 Discharge of Guarantor's securities.................................
4.8 Warranty as to Guarantor's understanding and validity...............
5. INSOLVENCY OF BORROWER OR GUARANTOR
5.1 Guarantor not to prove in competition...............................
5.2 PHF as Guarantor's attorney.........................................
6. PROVISIONS APPLYING TO A TRUSTEE GUARANTOR
6.1 Application of clause 6.............................................
6.2 Warranties relating to the Trust....................................
6.3 Specific prohibitions relating to the Trust.........................
6.4 Financial information...............................................
6.5 Guarantor's right of indemnity......................................
6.6 PHF to have direct access to Trust assets...........................
6.7 New trustees........................................................
6.8 Guarantor's liability unlimited.....................................
7. GENERAL
7.1 Costs and stamp duty................................................
7.2 Signing and serving of certificates, demands and notices............
7.3 Waivers and variations..............................................
7.4 Severability of provisions..........................................
7.5 Applicable law......................................................
<PAGE> 303
FORM 2 Version 2 QUEENSLAND LAND REGISTRY
Land Title Act 1994 And Land Act 1994 MORTGAGE Page 1 of 45
<TABLE>
<CAPTION>
<S> <C> <C>
- -------------------------------------------------- ---------------------------------------------------
Dealing No. Stamp Duty Imprint
- -------------------------------------------------- ---------------------------------------------------
1. INTEREST BEING MORTGAGED LODGER Name, address & phone number LODGER
CODE
Fee Simple PHILLIPS FOX, SOLICITORS 283
PO BOX 7804, WATERFRONT PLACE
BRISBANE QLD 4001
(07) 3246 4000 LJB
- -------------------------------------------------------------------------------------------------------
2. DESCRIPTION OF LOT COUNTY PARISH TITLE REFERENCE
Lot 2 on SP 103669 Stanley Mitchell 50239805
- -------------------------------------------------------------------------------------------------------
3. MORTGAGOR
PENDER BROS PTY LTD ACN 000 003 556
- -------------------------------------------------------------------------------------------------------
4. MORTGAGEE Given names Surname/Company name and Number (include tenancy if more than
one)
PRINCIPAL HEALTHCARE FINANCE PTY
LIMITED ACN 069 875 476
- -------------------------------------------------------------------------------------------------------
5. DESCRIPTION OF DEBT OR LIABILITY SECURED
The "Secured Money" as the term is defined in the Form 20 Schedule.
- -------------------------------------------------------------------------------------------------------
6. COVENANT/EXECUTION
The Mortgagor hereby covenants with the Mortgagee in terms of the attached
schedule and charges the estate or interest in the land with the
repayment/payment to the Mortgagee of all sums of money referred to in item 5.
WITNESSING OFFICER EXECUTION DATE MORTGAGOR'S SIGNATURE
..............................signature / / .........................
..............................full name
..............................qualification
as per Schedule 1 of Land Title Act 1994 (eg Legal Practitioner, JP, C.Dec)
WITNESSING OFFICER TO MORTGAGEE'S SIGNATURE EXECUTION DATE MORTGAGEE'S OR SOLICITOR'S SIGNATURE
.......................................signature / / .........................
.......................................full name
.......................................qualification
Note: A Solicitor is required to print full name if signing on behalf of the
Mortgagee as per Schedule 1 of Land Title Act 1994 (eg Legal Practitioner, JP,
C.Dec) and no witness is required in this instance
</TABLE>
<PAGE> 304
FORM 20 Version 1 QUEENSLAND LAND REGISTRY
Land Title Act 1994 and Land Act 1994 SCHEDULE Page 2 of 45
TITLE REFERENCE 15602076
1. DEFINITIONS AND INTERPRETATION
1.1 DEFINITIONS
1.1.1In this mortgage:
"APPLICABLE RATE" means the Overdue Rate;
"BORROWER" means any person who at any time has obligations to the
Mortgagee which are guaranteed by the Mortgagor including, without
limitation, Moran Australia and Moran Group;
"CHARGE" means the fixed and floating charge granted by the Mortgagor
to the Mortgagee on or around the date of this mortgage;
"CONSUMER CREDIT CODE" means the Consumer Credit (Queensland) Code
referred to in the Consumer Credit (Queensland) Act 1994 or any
corresponding regulation of another state or territory;
"CROWN LANDS ACT" means any legislation relating to the alienation by
sale, lease or otherwise or the occupancy, settlement, management or
improvement of Crown Lands including, without limitation, the Land Act
1994 (Qld);
"ENVIRONMENTAL PROTECTION LAW" means the Contaminated Land Act 1991
(Qld) and any other legislation or any directive, authority, permit or
licence issued by an authority relating to pollution, use of land or
protection of the environment;
"EVENT OF DEFAULT" means any event or circumstance referred to in
clauses 7.5, 11.3 or 19.2;
"GUARANTOR" means any person who at any time has given to the Mortgagee
any guarantee or indemnity or any form of security over its property as
security for any obligation owed to the Mortgagee by the Mortgagor or a
Borrower;
"LICENCE" means any licence or permit issued under the Liquor
Legislation which is used or exercised in relation to the Mortgaged
Property;
"LIQUOR LEGISLATION" means the Liquor Act 1992 (Qld) or any other
legislation relating to the sale, supply, disposal or consumption of
liquor or to the provision of entertainment, to the operation of
devices or to the licensing of premises on which liquor is sold,
supplied, disposed or consumed;
"MORTGAGED PROPERTY" means the land described in Item 2 of the Form 2
Mortgage together with any improvements, structures and fixtures on or
affixed to it at any time and any natural or planted crops growing on
it at any time;
"RECEIVER" means a receiver appointed by the Mortgagee under this
mortgage;
"SECURED MONEY" means any money in any currency which at any time under
the Capex Agreement:
(a) the Mortgagor or any Borrower in any capacity and whether
alone or with others:
(a) is actually or contingently liable to pay to the
Mortgagee;
<PAGE> 305
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Land Title Act 1994 And Land Act 1994 Page 4 of 45
SCHEDULE
TITLE REFERENCE 15602076
(a) may become actually or contingently liable to pay to the
Mortgagee in the future pursuant to any transaction or
arrangement at any time entered into or made by the Mortgagee
with any person; or
(a) may become actually or contingently liable to pay to the
Mortgagee in the future as liquidated or unliquidated damages
pursuant to any claim or cause of action;
(b) is at any time advanced or paid by the Mortgagee to a
person with the express or implied consent or at the express
or implied request of the Mortgagor or a Borrower; or
(c) the Mortgagee is or may become actually or contingently
liable to pay a person in connection with a transaction or
arrangement entered into with the express or implied consent
or at the express or implied request of the Mortgagor or a
Borrower,
other than money which is payable under a provision which is void under section
261 of the Income Tax Assessment Act 1936 or which is owing in relation to a
contract which is regulated by the Credit Act 1984 or by the Consumer Credit
Code or any similar legislation in any other state or territory.
"STRATA TITLE LEGISLATION" means the Body Corporate and Community Management Act
1997, Building Units and Group Titles Act 1980, the Integrated Resort
Development Act 1987, the Mixed Use Development Act 1993, Sanctuary Cove Resort
Act 1985 or such other legislation as shall amend or replace that legislation
from time to time;
"TRUST" means any trust or settlement pursuant to which the Mortgagor holds the
Mortgaged Property;
"TRUST DEED" means, in relation to a Trust, the instrument setting out all the
terms currently governing that Trust; and
"WORKS" means the demolition or alteration of improvements on the Mortgaged
Property or the construction of new improvements on the Mortgaged Property.
1.1.2 Where any word or phrase is given a defined meaning any
other part of speech or other grammatical form in respect of that
word or phrase has a corresponding meaning.
1.2 INTERPRETATION
1.2.1A reference to:
(a) a business day means a day during which banks are open for
general banking business in Sydney;
(b) this mortgage includes any schedules and annexures and,
where amended, means this mortgage as so amended;
(c) a receiver includes a manager and a receiver and manager;
and
(d) a liquidator includes a provisional liquidator.
1.1.2Unless the context otherwise requires, a word which denotes:
(a) the singular denotes the plural and vice versa;
<PAGE> 306
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Land Title Act 1994 And Land Act 1994 Page 5 of 45
SCHEDULE
TITLE REFERENCE 15602076
(b) any gender includes the other genders; and
(c) a person includes an individual, a body corporate and a
government.
1.2.3 Unless the context otherwise requires, a reference to:
(a) any legislation includes any regulation, by-laws or
instrument made under it and any orders or instruments having
the force of law and where amended, re-enacted or replaced
means that amended, re-enacted or replacement legislation;
(b) any other agreement or instrument where amended or
replaced means that agreement or instrument as amended or
replaced;
(c) a clause, schedule or annexure is a reference to a clause
of or annexure or schedule to this mortgage;
(d) a group of persons (including the Mortgagor if 2 or more
persons) includes any one or more of them; and
(e) any thing or amount is a reference to the whole and each
part of it.
1.3 JOINT AND SEVERAL
Any agreement, warranty, representation or obligation which binds or
benefits 2 or more persons under this mortgage binds or benefits those
persons jointly and severally.
1.4 SUCCESSORS AND ASSIGNEES
A person includes the trustee, executor, administrator, successor in
title and assignee of that person. This clause does not permit the
Mortgagor to assign any right under this mortgage.
1.5 HEADINGS AND TABLE OF CONTENTS
Headings and the table of contents must be ignored in the
interpretation of this mortgage.
1.6 REFERENCES TO AND CALCULATIONS OF TIME
1.6.1 Unless the context otherwise requires, a reference to a
time of day means that time of day in the state or territory in
which the Mortgaged Property is situated.
1.6.2 For the purposes of determining the length of a period (but
not its commencement) a reference to:
(a) a day means a period of time commencing at midnight and
ending 24 hours later; and
(b) a month means a calendar month which is a period
commencing at the beginning of a day of one of the 12 months
of the year and ending immediately before the beginning of
the corresponding day of the next month or, if there is no
such corresponding day, ending at the expiration of the next
month.
1.6.3 Where a period of time is specified and dates from a given
day or the day of an act or event it must be calculated exclusive
of that day.
1.6.4 Where something is done or received after 5.00 pm on any day
it will be deemed to have been done or received on the following
day.
<PAGE> 307
FORM 20 Version 1 QUEENSLAND LAND REGISTRY
Land Title Act 1994 and Land Act 1994 Page 6 of 45
SCHEDULE
TITLE REFERENCE 15602076
1.6.5 A provision of this mortgage which has the effect of
requiring anything to be done on or by a date which is not a
business day must unless the context otherwise requires be
interpreted as if it required it to be done on or by the
immediately preceding business day.
1.7 CORPORATE RELATIONSHIPS
A reference to a person being associated with another person or a
company being related to or the subsidiary of another corporation or
being a holding company has the same meaning as in the Corporations
Law.
[ ][ ]
1.8 DEFINED TERMS IN THE CHARGE
Words which have a defined meaning in the Charge have the same meaning
when used in this mortgage unless the same word is also defined in this
mortgage, in which case the definition in this mortgage prevails to the
extent of the inconsistency.
2. PERFORMANCE OF MORTGAGOR'S OBLIGATIONS
GENERALLY
2.1 PERFORMANCE OF ALL OBLIGATIONS
In addition to its obligations under this mortgage, the Mortgagor must:
(a) duly perform all of its other obligations (both positive
and negative) at any time owed to the Mortgagee; and
(b) duly perform or cause the due performance of all of the
obligations of a Borrower at any time owed to the Mortgagee
whether or not the Mortgagor has consented to the Borrower
undertaking such obligations.
2.2 THE MORTGAGEE'S RIGHT TO REMEDY
If the Mortgagor or a Borrower fails to duly perform any obligation
owed to the Mortgagee, the Mortgagee may do anything it considers
appropriate to protect its interests including, in its discretion,
performing such obligation itself. The costs of and liabilities
incurred from any such action must be paid by the Mortgagor upon
demand. Action by the Mortgagee to protect its interests does not
amount to any waiver of an Event of Default.
2.3 SUBSEQUENT MORTGAGE AND TACKING
For the purpose of applying section 82(1)(c) of the Property Law Act
1974, the Mortgagor covenants to observe and perform each and every
obligation contained in this mortgage and also each and every
obligation contained in any other agreement in writing between the
Mortgagee and the Mortgagor and/or the Borrower relating to the Secured
Money including, without limitation, any of the following obligations
contained in any such agreement that is:
(a) the obligation to make further advances;
(b) the obligation to allow any loan or part of such loan to
be redrawn or rolled over after repayment;
(c) the obligation to accept or discount any bill of exchange
whether in substitution for an existing bill of exchange or
otherwise;
(d) the obligation to issue any guarantee or accept any
liability for or on account of the Mortgagor and/or the
Borrower,
<PAGE> 308
FORM 20 Version 1 QUEENSLAND LAND REGISTRY
Land Title Act 1994 and Land Act 1994 SCHEDULE Page 7 of 45
TITLE REFERENCE 15602076
to the same extent as if any such obligation was repeated in full in
this mortgage and the Mortgagor agrees that any such obligation shall
be deemed to be incorporated as an integral term of this mortgage.
2.4 LIMITATION OF LIABILITY
The Mortgagor's liability is respect of the whole of the Secured Money.
However, the Mortgagor's liability under this mortgage is in aggregate
limited to $5,000,000.00 plus any interest payable on that amount and
any costs or expenses of any nature whatsoever incurred by the
Mortgagee under or in connection with this mortgage or any associated
security.
3. PAYMENT OF SECURED MONEY
3.1 OBLIGATION TO PAY AND TIME FOR PAYMENT
Subject to clause 3.3, the Mortgagor must pay the Secured Money to the
Mortgagee at the times and in the manner expressly agreed between the
Mortgagor or any Borrower and the Mortgagee.
3.2 NO PRE-CONDITION TO DEMANDING PAYMENT OF SECURED MONEY
The Mortgagor acknowledges that Secured Money includes any money owing
at any time by any Borrower to the Mortgagee and agrees to pay such
Secured Money when it becomes payable pursuant to clause 3.1
irrespective of whether the Mortgagee has made any demand on any
Borrower or any other person liable to pay Secured Money.
3.3 PAYMENT FOLLOWING AN EVENT OF DEFAULT
If an Event of Default occurs the Mortgagor must pay the Secured Money
to the Mortgagee immediately upon demand. Payment must include actual
payment on account of Secured Money which is of a contingent nature and
clause 3.6.3 applies accordingly.
3.4 PAYMENT WITHOUT DEDUCTION OR SET-OFF
Secured Money must be paid in full without any deduction. The Mortgagor
waives all rights of set-off, combination or counterclaim in relation
to payment of Secured Money.
3.5 CREDIT FOR PAYMENT
The Mortgagor will be given credit for payment of Secured Money only
upon its actual receipt in immediately available funds. If Secured
Money is received by the Mortgagee on a day which is not a business day
or after 12.00 p.m. on any business day the Mortgagee may refuse to
credit receipt until the next business day in which case the Mortgagor
must pay interest on that Secured Money until the receipt is credited.
3.6 APPLICATION OF PAYMENTS
3.6.1 The Mortgagor irrevocably waives its right to determine the
appropriation of any money paid to the Mortgagee. All payments of
Secured Money may be applied in the discretion of the Mortgagee
towards reduction or satisfaction of whichever part of the Secured
Money the Mortgagee elects.
3.6.2 Any rule relating to the application of money received by the
Mortgagee does not apply. If the Mortgagee has not made an election
it will be deemed to have applied payments in the manner and
against such Secured Money as is in its best interests.
<PAGE> 309
FORM 20 Version 1 QUEENSLAND LAND REGISTRY
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SCHEDULE
TITLE REFERENCE 15602076
3.6.3 Any money received by the Mortgagee in excess of Secured
Money then presently payable may be placed in an interest bearing
account and applied against Secured Money as it becomes presently
payable.
3.6.4 Money in an account pursuant to clause 3.6.3 belongs to the
Mortgagee. The Mortgagee must upon payment of the Secured Money in
full and the Mortgagee being satisfied that no further Secured
Money will arise pay to the Mortgagor (as a debt due) an amount
equal to the balance of the account (including accrued interest).
3.6.5 PLACE FOR PAYMENT OF MONEY
Subject to any express written agreement to the contrary, all Secured
Money must be paid to the Mortgagee at the place notified to the
Mortgagor or, in the absence of notice, at the Mortgagee's address in
this mortgage.
3.7 SET-OFF AGAINST OTHER ACCOUNTS
The Mortgagor irrevocably authorises the Mortgagee at any time without
notice to set-off against or combine with any Secured Money then
presently payable any amount in any currency standing to the credit of
any account of the Mortgagor with the Mortgagee. The Mortgagee has no
obligation to effect any set-off or combination under this clause. This
right is in addition to any rights arising under general law.
3.8 OVERPAYMENT
The Mortgagee is not required to pay or credit the Mortgagor with
interest on overpayment of the Secured Money. The Mortgagee at its
discretion may shed responsibility for the excess money by paying it to
a subsequent mortgagee or other encumbrancee (whether or not
registered), into court or to the credit of a bank account it opens up
in the Mortgagor's name and notifying the Mortgagor of what it has
done.
3.9 PAYMENT IN WRONG CURRENCY
If the Mortgagee receives payment of the Secured Money in a currency
other than that in which payment is due the Mortgagor will be given
credit:
(a) by reference to the spot rate at which the Mortgagee is
able to directly or indirectly purchase the currency in which
the payment is due;
(b) for the amount of the correct currency purchased after
deducting the costs of conversion (which may include a
commission charge by the Mortgagee); and
(c) on the date of settlement of the conversion into the
currency in which the payment is due.
3.10 INTEREST
3.10.1 Subject to clause 3.10.4 the Mortgagor must on the last
day of each month or upon earlier demand pay interest
calculated at the Applicable Rate on daily balances of any
Secured Money which does not otherwise bear interest from the
earlier of the date it became payable to or was outlaid by the
Mortgagee to the date of payment.
3.10.2 The Mortgagor acknowledges that, pursuant to clause
3.10.1, Secured Money which is interest not paid on its due
date will itself bear interest at the Applicable Rate.
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3.10.3 The charging, demanding and receipt of interest on
Secured Money not paid when due will not amount to a waiver of
the Mortgagee's rights pursuant to the Event of Default
arising because of that non-payment.
3.10.4 If an Event of Default occurs, interest accruing on
Secured Money and any other money owing is payable upon demand
by the Mortgagee.
4. INSURANCE OBLIGATIONS
4.1 BUILDING INSURANCE
The Mortgagor must keep all parts of the Mortgaged Property which are
insurable insured for the full insurable value on a replacement and
reinstatement basis against fire and such other risks as a prudent
owner of similar property would normally insure against or as are
reasonably required by the Mortgagee. This insurance must include the
Mortgagee as an insured party for its rights and interests.
4.2 PUBLIC LIABILITY AND OTHER INSURANCES
The Mortgagor must maintain:
(a) public liability insurance for an amount in relation to
any one accident or event of not less than $5 million where
the Mortgaged Property is a private residence and $10 million
otherwise or such other amount as the Mortgagee may at any
time require; and
(b) such other insurances which a prudent person owning
property similar to the Mortgaged Property would effect or
which are otherwise reasonably required by the Mortgagee.
4.3 ENDORSEMENT TO PROTECT AGAINST MORTGAGOR'S NON-DISCLOSURE
Where the Mortgagee is to be an insured party in respect of any
insurance required under this mortgage, the Mortgagor must procure an
endorsement on the relevant policy to the effect that the insurer will
not as against the Mortgagee avoid the policy, refuse indemnity or seek
to reduce its liability because of any failure to comply with a duty of
disclosure or misrepresentation by any other person.
4.4 GENERAL INSURANCE OBLIGATIONS
The Mortgagor must in respect of each insurance required under this
mortgage:
(a) effect it with a reputable insurer approved by the
Mortgagee (which approval must not be unreasonably withheld);
(b) deposit an original or duplicate of the policy with the
Mortgagee on request;
(c) pay all premiums for renewals not less than 3 business
days before expiry;
(d) immediately notify the Mortgagee of anything which may
give rise to a claim;
(e) immediately notify the Mortgagee of any cancellation or
proposal to cancel; and
(f) comply with its obligations and refrain from any action
which may have the effect of rendering it unenforceable.
4.5 ASSIGNMENT OF INSURANCE PROCEEDS
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4.5.1 The Mortgagor absolutely assigns to the Mortgagee as security
for the Secured Money all its rights to demand, sue for, recover
and receive proceeds (whether by way of premium refund, indemnity
or otherwise) of any insurance effected pursuant to clauses 4.1 or
4.2 and any other insurance (whether or not effected by the
Mortgagor) in respect of loss of or damage or destruction to any
Mortgaged Property or any property to be affixed to the Mortgaged
Property at any time.
4.5.2 Except in accordance with the Mortgagee's express
instructions, the Mortgagor must not make claims, sue for, recover,
settle, compromise or otherwise deal with any right to receive
proceeds of any such insurance.
4.5.3 The proceeds of any insurance referred to in clause 4.5.1
must be applied in reduction of the Secured Money or if the
Mortgagee in its discretion permits in reinstatement of the
Mortgaged Property.
5. POSITIVE OBLIGATIONS RELATING TO THE MORTGAGED
PROPERTY
5.1 REPAIR, SECURITY AND RECTIFICATION OF DEFECTS
The Mortgagor must:
(a) keep the Mortgaged Property in good repair and condition,
protected from theft, loss or damage;
(b) without limiting paragraph (a) keep the plant and
equipment on the Mortgaged Property in good working order and
properly maintained in accordance with the manufacturer's
recommendations; and
(c) upon request and within the time reasonably stipulated by
the Mortgagee rectify any defect in the Mortgaged Property.
5.2 OUTGOINGS
The Mortgagor must pay when payable all rents, rates, taxes, levies and
other outgoings of any nature in connection with the Mortgaged Property
and any business carried on by the Mortgagor on the Mortgaged Property
and upon request by the Mortgagee provide receipts for those payments.
5.3 TITLE DOCUMENTS
Subject to the rights of any prior mortgagee, the Mortgagor must
deposit with the Mortgagee all documents relating to its title in the
Mortgaged Property, all documents of lease or licence and any other
rights affecting the Mortgaged Property and all documents which may be
of use to the Mortgagee in exercising any power of sale over the
Mortgaged Property.
5.4 COMPLIANCE WITH OBLIGATIONS
The Mortgagor must duly comply with all of its obligations (both
positive and negative) and all conditions and restrictions in relation
to the Mortgaged Property including, without limitation, those arising
under legislation, by-laws or any encumbrance or covenant.
5.5 BUSINESS
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The Mortgagor must ensure that any business conducted by it or any
person associated with it on the Mortgaged Property is conducted and
maintained in a good and efficient manner and so that at all times any
legislation and the terms of any licence or approval relating to that
business are complied with.
5.6 RECTIFICATION OF ENCROACHMENTS
The Mortgagor must immediately on becoming aware of an encroachment by
an improvement erected principally on the Mortgaged Property rectify it
by obtaining an appropriate easement to permit its continued existence
and use or acquiring the affected land.
5.7 INTENTIONALLY DELETED
5.8 MAINTENANCE OF APPROVALS
The Mortgagor must obtain, maintain and comply with the terms of all
licences, approvals and consents necessary to:
(a) use the Mortgaged Property for its current use and any
other use permitted at the date of this mortgage; and
(b) conduct and maintain any business carried on by the
Mortgagor on the Mortgaged Property.
5.9 ENHANCEMENT OF SECURITY
The Mortgagor must exercise any right and take up any benefit relating
to the Mortgaged Property which enlarges the Mortgagor's interest in
the Mortgaged Property or which may enhance the value or saleability of
the Mortgaged Property.
5.10 INFORMATION
5.10.1 The Mortgagor must immediately give the Mortgagee notice and
copies of any notice or order requiring any work to be done to the
Mortgaged Property or relating to the use or condition of the
Mortgaged Property including, without limitation, notices or orders
pursuant to any Environmental Protection Law.
5.10.2 The Mortgagor must immediately provide the Mortgagee with
information and copies of any documents relating to the Mortgaged
Property which the Mortgagee at any time generally or specifically
requests.
5.11 ENVIRONMENTAL RISK MANAGEMENT
5.11.1 If requested by the Mortgagee at any time, the Mortgagor
must establish and maintain an environmental risk management
programme which:
(a) identifies all licences and approvals required from any
authority concerned with the control of pollution in
connection with the use of the Mortgaged Property or the
storage of any substances on the Mortgaged Property and
establishes procedures for ensuring that the conditions
attaching to those licences and approvals are complied with;
(b) identifies the potential for the use of the Mortgaged
Property or the storage of any substances on the Mortgaged
Property to cause pollution and establishes procedures for
ensuring that the risk of pollution is minimised; and
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(c) establishes training programmes which ensure that people
engaged in any activity carried on the Mortgaged Property or
the storage of any substances on the Mortgaged Property are
aware of the risks of pollution occurring and the measures to
be taken to minimise those risks.
5.11.2 The Mortgagor must, upon request by the Mortgagee:
(a) provide the Mortgagee with full details of its
environmental risk management programme and a certificate
signed by the Mortgagor (or if the Mortgagor is a company, 2
directors) that the programme is complied with;
(b) have its environmental risk management and its compliance
with that programme reviewed by an independent consultant
approved by the Mortgagee who is experienced in the management
of pollution risk from the activities of the kind being
carried on on the Mortgaged Property and comply with the
recommendations of that consultant;
(c) procure an environmental audit of the Mortgaged Property
and the Mortgagor's activities on the Mortgaged Property by an
independent consultant approved by the Mortgagee who is
experienced in assessing pollution and pollution risk from the
activities of the kind being carried on on the Mortgaged
Property; and
(d) provide the Mortgagee with full details of any internal or
external (pursuant to paragraph (b) or otherwise) review or
audit of its environmental risk management programme.
6. PROHIBITIONS IN RELATION TO MORTGAGED PROPERTY
6.1 DEALINGS AND ENCUMBRANCES
6.1.1 The Mortgagor must not, without the Mortgagee's consent,
dispose of or in any other way deal with or part with possession of
or agree to dispose of, deal with, or part with possession of:
(a) the Mortgaged Property or any estate or interest in it;
(b) its rights under any easement right of excessive
possession or covenant benefiting the Mortgaged Property; or
(c) any other right or interest of any kind existing in
connection with the Mortgaged Property.
The Mortgagor's statutory powers to lease, further encumber or
otherwise deal with the Mortgaged Property are, to the fullest extent
possible, excluded.
6.1.2 The Mortgagor must not permit the Mortgaged Property to be or
become encumbered or affected in any way other than in a manner
consented to by the Mortgagee. The existence of a charge arising
under legislation in relation to outgoings payable in respect of
the Mortgaged Property is not a breach of this clause unless the
outgoings have not been paid by their due date.
6.1.3 The Mortgagor must notify the Mortgagee of any caveat lodged
in respect of the Mortgaged Property and at the Mortgagee's request
immediately procure its removal.
6.1.4 Whether or not the Mortgagee has consented to any sale of or
other dealing with the Mortgaged Property the Mortgagor must pay to
the Mortgagee any deposit or similar payment released to it. The
acceptance of such money does not oblige the Mortgagee to consent
to the sale or dealing.
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6.1.5 Before exercising any statutory right to mortgage or
otherwise encumber the Mortgaged Property not excluded by this
mortgage the Mortgagor must procure an agreement by the proposed
mortgagee or encumbrancee (by way of deed with the Mortgagee) that
this mortgage ranks first for all Secured Money (present or
future).
6.2 LEASES
The Mortgagor must not in respect of any lease of the Mortgaged
Property without the Mortgagee's consent:
(a) agree to its variation;
(b) permit its surrender; or
(c) permit an assignment or sub-letting.
6.3 DEMOLITION, ALTERATIONS AND CHANGES TO NATURE AND TITLE
The Mortgagor must not, without the Mortgagee's consent:
(a) demolish, remove or alter any improvements or structures
on the Mortgaged Property;
(b) change or permit the change of the use of the Mortgaged
Property;
(c) change or permit the change of the nature of the Mortgaged
Property or the Mortgagor's title to it; or
(d) change or permit the change of the Mortgagor's interest in
or rights of occupation of the Mortgaged Property.
6.4 VALUE, SALEABILITY AND SECURITY
The Mortgagor must not do, omit, permit or cause anything which may in
the Mortgagee's reasonable opinion:
(a) result in the diminution of the value of the Mortgaged
Property;
(b) adversely affect the saleability of the Mortgaged
Property;
(c) render the Mortgaged Property or any right in relation to
the Mortgaged Property liable to forfeiture or cancellation;
or
(d) adversely affect the security constituted by this
mortgage.
6.5 INCREASES IN AMOUNTS SECURED BY OTHER CHARGES
The Mortgagor must not, without the Mortgagee's consent, permit the
amount secured by any other mortgage or charge (other than charges
arising under legislation in relation to outgoings in respect of the
Mortgaged Property) of the Mortgaged Property to increase above:
(a) in the case of a mortgage or charge existing at the date
of this mortgage, the amount then advised to the Mortgagee as
being secured by that mortgage or charge; or
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(b) in the case of a mortgage or charge created after this
mortgage, the amount notified to the Mortgagee in the
Mortgagor's application for the Mortgagee's consent to that
mortgage or charge.
6.6 USE
The Mortgagor must not use or permit the use of the Mortgaged Property
in an unlawful manner, for any unlawful purpose, or so that a nuisance
or disturbance is caused to owners or occupiers of nearby land.
7. PROVISIONS APPLYING TO STRATA TITLE
7.1 APPLICATION OF CLAUSE 7
This clause 7 applies where the Mortgaged Property at any time is
subject to the provisions of any Strata Title Legislation. Words or
phrases defined in any Strata Title Legislation have the same meaning
when they are used in this clause 7. In particular, any reference to a:
(a) "strata scheme" shall include a building units plan of
subdivision, group titles plan of subdivision or any scheme or
plan of subdivision of land under any Strata Title Legislation
which in any way relates to the Mortgaged Property;
(b) "body corporate" shall include any entity established upon
registration of a strata scheme.
7.2 INSURANCE
7.2.1 Clauses 4.1 and 4.2 do not apply to the extent that the Mortgaged
Property forms part of a strata scheme.
7.2.2 The Mortgagor must effect and maintain mortgagee protection
insurance for the benefit of the Mortgagee pursuant to any Strata
Title Legislation for the maximum amount permitted. Clause 4.4 applies
to such insurance.
7.2.3 The Mortgagor must use its best endeavours to ensure that the
body corporate complies with its insurance obligations under any
Strata Title Legislation and that in the case of each insurance
required to be effected by the body corporate:
(a) the risks insured against are those which a prudent person
would in similar circumstances insure against; and
(b) the amount of the insurance is sufficient to indemnify
the body corporate against any loss it may suffer because of
the occurrence of any risk insured against.
7.2.4 The Mortgagor must, at the Mortgagee's request, provide the
Mortgagee with particulars of all insurances effected by the body
corporate.
7.3 VOTING
The Mortgagor must:
(a) preserve its right to vote at general meetings of the
body corporate;
(b) if the Mortgagee requires, give the Mortgagee not less
than 5 business days' notice of proposed meetings of the
body corporate and business to be transacted;
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(c) subject to the rights of any prior mortgagee, obtain and
vote in accordance with the direction of the Mortgagee on
any motion requiring a special resolution, unanimous
resolution or resolution without dissent of the body
corporate; and
(d) at the Mortgagee's request, appoint the Mortgagee or its
nominee as its proxy to vote on its behalf at any meeting of
the body corporate.
7.4 INFORMATION
The Mortgagor must immediately notify and give the Mortgagee full
details of:
(a) any application or proposal for the variation or
termination of the strata scheme; and
(b) any notice or order received from any relevant authority
or any court relating to the Mortgaged Property or the
common property.
7.5 ADDITIONAL EVENTS OF DEFAULT
An Event of Default occurs if, without the Mortgagee's consent:
(a) the body corporate passes a resolution and, as a
consequence, in the Mortgagee's reasonable opinion the value
of the Mortgaged Property or its saleability is or is likely
to be adversely affected; or
(b) an application is made for the termination of the strata
scheme.
7.6 NOTICES
The Mortgagor must immediately cause notices to be served on the body
corporate of the relevant strata scheme in accordance with any Strata
Title Legislation and provide evidence of registration of the
Mortgagee's interest.
7.7 AUTHORITY TO OBTAIN INFORMATION
The Mortgagor irrevocably authorises the Mortgagee and its officers
severally to apply to the body corporate for any information.
7.8 COVENANTS
The Mortgagor must:
(a) observe and comply with all provisions of any Strata
Title Legislation and any by-laws of the body corporate from
time to time in force;
(b) pay punctually all levies, contributions or other moneys
payable in connection with the Mortgaged Property under any
Strata Title Legislation or otherwise and will if the
Mortgagee requires give receipts relating to such payments
to the Mortgagee;
(c) not surrender, assign or otherwise dispose of any rights
to use any part or parts of the common property or concur in
or agree to any dealing with such common property without
the Mortgagee's prior consent;
(d) comply with the terms of any restrictions on user
affecting common property.
8. FOREIGN OWNERSHIP OF LAND REGISTER ACT
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8.1 WARRANTIES RELATING TO THE FOREIGN OWNERSHIP OF LAND REGISTER ACT
The Mortgagor warrants to the Mortgagee that:
(a) there is no restriction or impediment under the Foreign
Investment Guidelines and requirements of the Governments of
the Commonwealth of Australia and the State of Queensland to
the Mortgagor owning the Mortgaged Property; and
(b) the Mortgagee and its predecessors in title have strictly
complied with all the requirements of the Foreign Ownership of
Land Register Act 1988 (referred to in this Clause 8 as the
"Act").
8.2 OBLIGATIONS OF THE MORTGAGOR
The Mortgagor must:
(a) strictly comply with all the requirements of the Act from the
date of this mortgage or from time to time as the case may be;
(b) within 24 hours of the receipt by the Mortgagor, give to the
Mortgagee any orders, notices, declarations and/or other
proceedings issued pursuant to the Act.
(c) inform the Mortgagee immediately when the Mortgagor has
knowledge of any facts or circumstances which may give rise to
any orders, notices, declarations and/or other proceedings
referred to in paragraph (c);
(d) notify the Mortgagee of any notice, form or document which has
been lodged by the Mortgagor and/or its agents, successors and
assigns with the Registrar pursuant to the Act and provide a
copy of such notice to the Mortgagee within 24 hours of
lodging.
9. ENVIRONMENTAL PROVISIONS
9.1 APPLICATION OF CLAUSE 9
This clause 9 applies where the Mortgaged Property at any time is
subject to the provisions of any Environmental Protection Law. Words or
phrases defined in any Environmental Protection Law have the same
meaning when used in this clause 9.
9.2 OBLIGATIONS OF THE MORTGAGOR
The Mortgagor must:
(a) immediately provide notice to the Mortgagee upon the Mortgagor
becoming aware that the Mortgaged Property is Contaminated Land
or that the Mortgaged Property is likely to become Contaminated
Land.
(b) cause all acts and matters to be done, carried out or performed
to ensure that the Mortgaged Property is free or clear of
contamination and shall cease to carry on any acts or
activities which may cause the Mortgaged Property to become
Contaminated Land.
(c) immediately provide notice to the Mortgagee upon the Mortgagor
receiving any notice, direction, order or condition from the
Director.
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(d) permit the Mortgagee and its agents to come onto, enter
and inspect the Mortgaged Property at any reasonable time
and to carry out any environmental audits or environmental
site assessments that it may consider necessary provided the
Mortgagee has first given notice to the Mortgagor.
9.3 WARRANTIES BY THE MORTGAGOR
The Mortgagor warrants to the Mortgagee that the Mortgaged Property:
(a) has not at any time been used for or in connection with
the use, creation, containment, handling, storage, transfer,
transportation, treatment, disposal or any other means of
dealing whatsoever with any Hazardous Substance or Waste;
(b) has not at any time (whether before or after the
Mortgagor acquired any interest in the Mortgaged Property)
been polluted or contaminated and is not Contaminated Land;
or
(c) has not and has never been subject to any notice,
direction, order or condition from the Director requiring any
person to take remediation measures set out in such notice,
directions, order or condition and the Mortgagor is not aware
of the pending or contemplated issue of any such notice,
direction, order or condition from the Director.
9.4 INDEMNITY BY MORTGAGOR
The Mortgagor hereby indemnifies and agrees to keep indemnified the
Mortgagee, its directors and any other officers in management and
control of the Mortgagee at any time, any Receiver and any agent of the
Mortgagee from and against all costs, claims, expenses, liabilities,
causes of action, proceedings, awards, judgments, fines, penalties,
(including, but not limited to any costs and expenses of defending or
denying the same and including, but not limited to the costs and
expenses of preparing any necessary environmental audit report or other
such reports and the costs of any remediation measures) arising out of
the Mortgagee's interest in the Mortgaged Property and in respect of:
(a) any contamination or pollution howsoever arising on, from
or otherwise connected with the Mortgaged Property or any part
of it by any Hazardous Substance or Waste at any time and from
time to time, whether such pollution or contamination emanates
from the Mortgaged Property or from outside the boundaries of
such Mortgaged Property;
(b) any remedial action taken by the Mortgagee either before
or consequent upon enforcement of the Mortgage by the
Mortgagee in respect of such contamination or pollution;
(c) any action taken or to be taken by the Mortgagee, whether
before or after any enforcement proceedings taken by the
Mortgagee pursuant to the Mortgage to mitigate or abate any
harm or likely harm or threat to the environment or to the
health of any person arising out of any such contamination or
pollution;
(d) the Mortgagee complying with any notice, condition or
order by the Director or any relevant person whether it is
obliged or required to do so or not, and whether before or
after any enforcement proceedings taken pursuant to the
Mortgage, requiring any such contamination or pollution to be
cleaned up, contained, removed, diluted or dealt with in any
way whatsoever including the costs of the Director or any
relevant person in issuing any such notice or order as
aforesaid.
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10. HERITAGE LEGISLATION
10.1 APPLICATION OF CLAUSE 10
This clause 10 applies where the Mortgaged Property at any time is or
may be subject to the provisions of the Heritage Act 1992 (Queensland)
("Heritage Act"). Words or phrases defined in the Heritage Act have the
same meaning when used in this clause 10.
10.2 HERITAGE REGISTER
The Mortgagor warrants to the Mortgagee that the Mortgaged Property is
not entered on the Heritage Register maintained under the Heritage Act.
10.3 ENTRY ON OR REMOVAL FROM HERITAGE REGISTER
The Mortgagor must:
(a) not apply for the Mortgaged Property to be placed on the
Heritage Register without the written consent of the
Mortgagee.
(b) forthwith give to the Mortgagee a copy of any notice,
order, correspondence or paperwriting received from the
Queensland Heritage Council.
(c) at the Mortgagor's own cost object to any proposal to
enter the Mortgaged Property on the Heritage Register unless
the Mortgagee exempts the Mortgagor from the requirement to
object in accordance with the Heritage Act.
(d) in lodging an objection:
(d) where required by the Mortgagee, lodge the objection in
the form and containing the materials required by the
Mortgagee; and
(d) comply with the Heritage Act to ensure the lodgment of a
valid objection.
(e) if the Mortgaged Property is, at any time, listed on the
Heritage Register at the request of the Mortgagee and at the
cost of the Mortgagor;
(e) apply to remove the Mortgaged Property from the Heritage
Register. In making such application the Mortgagor shall
accept direction (if any) from the Mortgagee as to the form
and content of the application; and
(e) lodge and vigorously pursue an appeal to the Planning and
Environment Court against the decision within the time allowed
under the Heritage Act. In any such appeal the Mortgagor shall
accept direction (if any) from the Mortgagee as to the form
and content of the appeal and the management of the appeal.
10.4 CERTIFICATE OF IMMUNITY
The Mortgagor must apply for a certificate of immunity from
registration if the Mortgagee at any time requires the Mortgagor to do
so.
10.5 COMPLIANCE WITH HERITAGE ACT
The Mortgagor must at all times comply with each and every of
theprovisions of the Heritage Act.
10.6 HERITAGE AGREEMENT
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(a) The Mortgagor shall not without the prior consent in
writing of the Mortgagee enter into a heritage agreement
relating to the Mortgaged Property.
(b) If a heritage agreement is entered into, the Mortgagor
shall comply with all terms of the heritage agreement.
10.7 THE MORTGAGEE'S COSTS AND EXPENSES
Any cost or expense incurred by the Mortgagee in relation to any issue
or matter pertaining to the provisions of this clause (including all
legal costs and other consultant's costs) will constitute part of the
Secured Money and will bear interest as provided in this mortgage from
the date of payment of those costs and expenses.
11. PROVISIONS APPLYING TO LIQUOR ACT LICENCES
11.1 APPLICATION OF CLAUSE 11
This clause 11 applies where the Mortgaged Property at any time is or
includes licensed premises under Liquor Legislation or premises where a
Licence issued under Liquor Legislation is used or exercised. Words or
phrases defined in the Liquor Legislation have the same meaning when
used in this clause 11.
11.2 SPECIAL OBLIGATIONS RELATING TO LICENSED PREMISES
Without limiting the Mortgagor's obligations pursuant to clause 5.5,
the Mortgagor must:
(a) personally, or by means of the person who holds the
Licence, carry on the business conducted on the Mortgaged
Property for which the Licence is held in a proper and orderly
manner;
(b) keep the licensed premises open during normal trading
hours;
(c) comply with the Liquor Legislation and any requirements or
orders of authorities in respect of the Licence and the
licensed premises;
(d) oppose any application to restrict, suspend or cancel the
Licence;
(e) not without the Mortgagee's consent:
(e) remove or apply to remove the Licence or allow the Licence
to be removed;
(e) surrender, attempt to surrender, dispose of, deal with or
part with possession of any interest in the Licence; or
(e) create or allow any encumbrance which affects the Licence;
and
(f) give the Mortgagee a copy of any summons, conviction,
order or notification under the Liquor Legislation in
connection with the Licence or the licensed premises.
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11.3 ADDITIONAL EVENTS OF DEFAULT
An Event of Default occurs if:
(a) the conditions attached to the Licence are, in the opinion
of the Mortgagee, materially varied; or
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(b) the Mortgagee reasonably suspects that the Mortgagor or
the person who holds the Licence or any of their servants or
agents have done or are about to do something which is
prohibited by this mortgage or which may put the Licence in
jeopardy or materially affect the security under this mortgage
(including, without limitation, being convicted of an
offence).
11.4 PROCEDURES AFTER AN EVENT OF DEFAULT
After an Event of Default:
(a) at the request of the Mortgagee, the Mortgagor must use
its best endeavours to obtain a transfer of the Licence to the
Mortgagee or its nominee; and
(b) the Mortgagee, or a Receiver having entered into
possession of the licensed premises, is irrevocably authorised
by the Mortgagor to serve liquor and exercise generally all of
the rights arising pursuant to the Licence in the Mortgagor's
name.
12. PROVISIONS APPLYING TO AGRICULTURAL LAND
12.1 APPLICATION OF CLAUSE 12
This clause 12 applies where the Mortgaged Property at any time is or
includes land used for an agricultural, horticultural or rural purpose.
12.2 SPECIAL OBLIGATIONS RELATING TO AGRICULTURAL LAND
Without limiting the Mortgagor's obligations pursuant to clause 5.5,
the Mortgagor must:
(a) personally or by persons with proper skills, cultivate and
manage the Mortgaged Property in a proper and husbandlike
manner and preserve and maintain the Mortgaged Property in a
proper and efficient state of improvement and cultivation;
(b) erect and keep in good repair all fences and adopt other
measures necessary for keeping the Mortgaged Property free
from pests (including, without limitation, rabbits and other
noxious animals), insects, infestations and diseases;
(c) take all reasonable steps for exterminating all growths
which might interfere with or lower the value or utility of
the Mortgaged Property for grazing, farming, horticultural or
agricultural purposes;
(d) at the Mortgagee's request (but at the Mortgagor's cost)
immediately execute and register in a form required by the
Mortgagee a lien over or mortgage of (with the same or better
ranking as this mortgage) any wool clip in relation to sheep
grazed on the Mortgaged Property, any stock grazed on the
Mortgaged Property or any agricultural or horticultural
produce grown on the Mortgaged Property as further security
for the Secured Money;
(e) not give any other lien, charge or stock mortgage over or
on any crop, stock or produce arising from the use of the
Mortgaged Property except with the Mortgagee's consent;
(f) comply with any condition of any statutory authority and
with other licences or quotas affecting or regulating
production from the Mortgaged Property or sale of produce from
it;
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(g) obtain and maintain all water licences and rights and
comply with any conditions attaching to them; and
(h) not dispose of, deal with or part with possession of a
quota for the production or sale of any crop or produce
capable of being produced on the Mortgaged Property without
the Mortgagee's consent and not do or permit to be done
anything which might cause any such quota to be forfeited,
surrendered or reduced.
13. PROVISIONS APPLYING TO CROWN LANDS
13.1 APPLICATION OF CLAUSE 13
This clause 13 applies where the Mortgaged Property at any time is or
includes land subject to any of the Crown Lands Acts.
13.2 OBLIGATIONS OF THE MORTGAGOR
The Mortgagor must:
(a) from time to time, apply for and do whatever may be
necessary to procure the renewal of leases or licences or
enforce any right of purchase or pre-emption under the Crown
Lands Acts;
(b) so far as the law permits, convert or join with the
Mortgagee in converting any of the Mortgaged Property into
freehold or into any other form of tenure which may be allowed
by any legislation at any time;
(c) not do or permit any act which would render the Mortgaged
Property liable to forfeiture or cancellation or to be
otherwise prejudiced;
(d) comply with all the conditions and requirements of the
Crown Lands Acts which apply to the Mortgagor or the Mortgaged
Property including, in particular, any conditions and
requirements which relate to improvements; and
(e) not do or allow any act to be done whereby the present or
any future holding, tenure or licence may be surrendered,
forfeited or prejudiced and must make any application and do
whatever may be necessary for acquiring any additional
holdings or other leased lands or enforcing any rights
according to the Crown Lands Acts.
14. PROVISIONS APPLYING TO A TRUSTEE MORTGAGOR
14.1 APPLICATION OF CLAUSE 14
This clause 14 applies where the Mortgagor is the owner or registered
proprietor of the Mortgaged Property as trustee of a Trust.
14.2 WARRANTIES RELATING TO THE TRUST
The Mortgagor warrants to the Mortgagee that:
(a) a true and complete copy of the Trust Deed has been
supplied to the Mortgagee's solicitors;
(b) the Trust is validly created and subsisting and no
circumstances exist pursuant to which it may be determined and
no date for the vesting of any of the Trust fund has been
appointed other than as may be set out in the Trust Deed;
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(c) the Mortgagor is validly appointed as the sole trustee of
the Trust, is not in breach of its obligations as trustee and
no circumstances exist pursuant to which it may be removed;
(d) this mortgage is duly executed and granted pursuant to and
in proper exercise of the powers of the Mortgagor as trustee
of the Trust and all formalities required by the Trust Deed in
connection with this mortgage have been complied with;
(e) the execution and performance of this mortgage is a proper
purpose of the Trust and the Trust is receiving a valuable
commercial benefit in return for entering into this mortgage;
(f) the Mortgagor is entitled to be fully indemnified out of
the assets of the Trust in respect of its liability for
Secured Money;
(g) the Mortgagor is the legal owner of all the assets of the
Trust; and
(h) there is no dispute between the Mortgagor and any other
person in relation to the Trust or the Trust assets.
14.2.1 SPECIFIC PROHIBITIONS RELATING TO THE TRUST
The Mortgagor must not, without the Mortgagee's consent:
(a) cease to be the sole trustee of the Trust;
(b) cause or permit the Trust to be determined or a vesting
date to be appointed;
(c) do or permit anything which adversely affects the
Mortgagor's right of indemnity against the Trust assets;
(d) in any way vary the Trust Deed or permit it to be varied;
(e) distribute or dispose of any Trust assets; or
(f) delegate any powers of the Mortgagor as trustee of the
Trust or exercise any power of appointment.
14.3 FINANCIAL INFORMATION
The Mortgagor must at the request of the Mortgagee provide full
financial details of the Trust.
14.4 MORTGAGOR'S RIGHT OF INDEMNITY
Without limiting any right of subrogation the Mortgagee may have, the
Mortgagor assigns its right of indemnity against Trust assets to enable
payment of the Secured Money to the Mortgagee. As a separate and
independent right the Mortgagor grants the Mortgagee direct access to
the Trust assets to obtain payment of the Secured Money.
14.5 NEW TRUSTEES
The Mortgagor must procure that any person who becomes a trustee of the
Trust (whether in replacement of or in addition to the Mortgagor)
enters into a deed with the Mortgagee whereby it agrees to perform the
obligations of the Mortgagor under this mortgage.
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14.6 MORTGAGOR'S LIABILITY UNLIMITED
The Mortgagor's liability to pay Secured Money to the Mortgagee and to
perform its other obligations owed to the Mortgagee is not limited or
otherwise affected by the Mortgagor being trustee of the Trust or the
extent of its ability to indemnify itself out of the assets of the
Trust.
15. PROVISIONS APPLYING TO WORKS ON MORTGAGED PROPERTY
15.1 CONSENTS REQUIRED IN RELATION TO WORKS
15.1.1 The Mortgagor must not carry out any Works without the
consent of the Mortgagee.
15.1.2 The Mortgagor must not enter into a contract to design or
carry out Works for a price in excess of $10,000.00 unless the
Mortgagee has approved the form and terms of the contract and the
design consultant and the builder. If the Mortgagee requires the
Mortgagor must procure that the builder and any design consultant
each enters into a side agreement with the Mortgagee and the
Mortgagor containing such terms as the Mortgagee requires
including, without limitation, to the effect that:
(a) the builder or the design consultant will not terminate
the building or design contract without giving the Mortgagee
notice;
(b) the builder or the design consultant will not terminate
the building or design contract because of any default by the
Mortgagor if the Mortgagee undertakes to pay for work done
subsequent to the default subject to verification by its own
consultants; and
(c) if required by the Mortgagee, the builder or the design
consultant will by way of novation of the building or design
contract enter into a new building or design contract with the
Mortgagee or its nominee at the same price and upon the same
terms.
15.2 LODGEMENT OF PLANS AND AUTHOR'S LICENCE
The Mortgagor must before commencing any Works lodge with the Mortgagee
1 copy of all plans and specifications for the Works together with
evidence of all necessary consents and approvals. The Mortgagor must
procure that the author of those plans in writing licences the
Mortgagee to use them and grant sub-licences in connection with the
exercise of any of its powers under this mortgage.
15.3 CARRYING OUT OF WORKS
The Mortgagor must procure that any Works are carried out:
(a) in accordance with plans and specifications approved by
the Mortgagee and any relevant authority;
(b) in a good and workmanlike manner by qualified
tradespeople;
(c) with the minimum of delay; and
(d) in accordance with all legislation and the requirements of
any authority.
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15.4 REPORTING ON WORKS
If the Mortgagee requires, the Mortgagor must:
(a) engage a quantity surveyor or other consultant required by
the Mortgagee to report to the Mortgagee on the progress of
the Works and their compliance with approvals; and
(b) give the Mortgagee regular reports on the progress of the
Works, all payments made in relation to the Works and any
matter which may delay or adversely affect the completion of
the Works.
15.5 INSURANCES
The Mortgagor must ensure that:
(a) any insurances of any improvements on the Mortgaged
Property not to be demolished are maintained and not voidable
because of the Works;
(b) any improvements constructed pursuant to the Works are
insured for their full insurable value from time to time and
that the Mortgagee is included as an insured party for its
rights and interests;
(c) public liability insurance in relation to the Mortgaged
Property for an amount required by the Mortgagee is maintained
during the course of the Works; and
(d) workers' compensation insurance and any other insurances
required by law in relation to the carrying out of the Works
are effected and maintained by the person responsible.
15.6 RETENTION MONEY
The Mortgagor must not pay over any retention under the building
contract in relation to any Works without the Mortgagee's consent.
15.7 COMPLETION CERTIFICATES
The Mortgagor must on completion of the Works promptly procure delivery
to the Mortgagee of certificates from relevant authorities to the
effect that the Works have been carried out and completed in accordance
with all necessary approvals and consents and that the improvements
effected by the Works may be occupied.
15.8 MANUFACTURER'S WARRANTIES
The Mortgagor assigns to the Mortgagee the benefit of all warranties in
relation to any goods fixed to the Mortgaged Property in the course of
carrying out the Works.
16. THE MORTGAGEE'S RIGHT OF ACCESS
The Mortgagor irrevocably authorises the Mortgagee and any person
instructed or authorised by the Mortgagee to enter the Mortgaged
Property and any other place where records relating to the Mortgaged
Property or any business conducted thereon are maintained during normal
business hours to inspect the Mortgaged Property, any records relating
to it or any business conducted upon it or for any other purpose in
connection with this mortgage. The Mortgagor must obtain any necessary
consent, give that person reasonable assistance in carrying out his
requirements and upon request provide copies of any documents relating
to the Mortgaged Property and any business conducted upon it.
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17. COMPENSATION ARISING IN RELATION TO MORTGAGED PROPERTY
17.1 NOTIFICATION OF PROPOSALS
The Mortgagor must immediately inform and give all details to the
Mortgagee upon becoming aware of:
(a) any proposal (including without limitation any resumption,
appropriation or compulsory acquisition) affecting or which
may affect the Mortgaged Property; or
(b) any claim for compensation arising in respect of the
Mortgaged Property or any work carried out on it.
17.2 COMPENSATION BENEFITS
17.2.1 The Mortgagor absolutely assigns to the Mortgagee as
security for the Secured Money all its rights to demand, sue for,
recover and receive compensation arising at any time in
connection with the Mortgaged Property.
17.2.2 Except in accordance with the Mortgagee's express
instructions, the Mortgagor must not make claims or take any
action to recover, settle, compromise, or otherwise deal with any
right to receive such compensation.
17.2.3 The proceeds of any compensation referred to in clause
15.2.1 must be applied in reduction of the Secured Money unless
the Mortgagee in its discretion permits otherwise.
18. WARRANTIES AND INDEMNITIES
18.1 WARRANTIES
The Mortgagor warrants to the Mortgagee that:
(a) it is or is unconditionally entitled to be registered as
proprietor of the Mortgaged Property with an indefeasible
title free from any encumbrance other than those noted in this
mortgage as prior encumbrances and those expressly approved of
in writing by the Mortgagee prior to this mortgage being
given;
(b) unless otherwise expressly disclosed and approved in
writing by the Mortgagee any business carried on or to be
carried on on the Mortgaged Property belongs to and is or will
be carried on by the Mortgagor;
(c) this mortgage is in all respects valid and binding on the
Mortgagor and enforceable in accordance with its terms;
(d) the Mortgagor and any Borrower or Guarantor has fully and
correctly disclosed all information:
(d) to the Mortgagee which has been requested by the Mortgagee
or its solicitors in connection with this mortgage;
(d) to the Mortgagee which is material to the Mortgagee's
assessment of the value and appropriateness of the Mortgaged
Property as security for the Mortgagor's obligations to the
Mortgagee;
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(d) to any valuer who has provided any valuation of the
Mortgaged Property to the Mortgagee which is material to that
valuer's assessment of the value of the Mortgaged Property;
and
(d) to any insurer who has insured the Mortgaged Property or
any risk in connection with it which is material to that
insurer's assessment of the insurance risk and the appropriate
premium;
(e) no Event of Default has occurred and no event has occurred
and no circumstance exists which with the giving of notice,
lapse of time or fulfilment of any condition would constitute
an Event of Default;
(f) unless otherwise expressly disclosed to and approved by
the Mortgagee it is or is unconditionally entitled to be the
absolute legal and beneficial owner of the Mortgaged Property;
and
(g) there is no breach of any Environmental Protection Law in
respect of the use or condition of the Mortgaged Property and
there are no outstanding notices or restraining orders
affecting the Mortgaged Property or its use issued pursuant to
any Environmental Protection Law;
(h) where the mortgage secures money owing by a Borrower, the
Mortgagor (where it is a company) is receiving valuable
commercial benefit for giving this mortgage;
(i) the Mortgagor has been given the opportunity to obtain and
has obtained such legal, and financial advice in relation to
its obligations and liabilities under this mortgage as is
necessary to fully understand those obligations and
liabilities;
(j) the Mortgagor has not relied upon any representation or
statement by or on behalf of the Mortgagee, but has determined
to enter into this mortgage solely upon its own assessment
after having obtained advice from its own advisers;
(k) the Mortgagor is not in breach of any Licence or agreement
relating to or granting any Licence; and
(l) the Mortgagor has obtained all necessary consents and
complied with all internal procedures in relation to the
execution and performance of this mortgage.
18.2 INDEMNITIES
18.2.1 The Mortgagor indemnifies the Mortgagee against all
actions, claims, demands, losses (including, without limitation,
loss of margin), damages, liabilities, costs and expenses of any
nature suffered or incurred at any time actually or contingently
by the Mortgagee as a direct or indirect consequence of:
(a) a failure by the Mortgagor or a Borrower to pay any
Secured Money when payable or comply with any other obligation
owed to the Mortgagee;
(b) the occurrence of any Event of Default;
(c) the Mortgagee exercising or attempting to exercise any
power or right of the Mortgagee under this mortgage, in any
other agreement between the Mortgagor or a Borrower and the
Mortgagee or at general law;
(d) the Mortgagee entering into any agreement or transaction
in connection with this mortgage;
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(e) the Mortgagee seeking to recover any Secured Money from
any other person liable to pay it;
(f) an actual or assumed legal obligation of the Mortgagee to
pay any money or do any thing in connection with the Mortgaged
Property;
(g) a warranty in this mortgage being incorrect in any
respect;
(h) judgment being given for any Secured Money in a currency
other than that in which that Secured Money is due;
(i) the rate of interest applying to any judgment debt being
less than that applying to the original obligation to pay
Secured Money in respect of which judgment was obtained;
(j) the Mortgagee receiving payment of Secured Money earlier
or later than the date it should be paid if no Event of
Default had occurred;
(k) a claim that a payment, obligation, settlement,
transaction, conveyance or transfer in connection with Secured
Money (or money which would be Secured Money if the claim was
invalid) is void or voidable under any law relating to
insolvency, bankruptcy or the protection of creditors or for
any other reason being upheld conceded or compromised;
(l) the appointment of and any indemnity given to a Receiver;
(m) the Mortgagee acting as the Mortgagor's attorney or
providing an indemnity to any person so acting;
(n) the Mortgagee paying (whether or not under a legal
obligation) any loss, cost or expense incurred by any officer,
employee, agent or consultant of the Mortgagee in connection
with this mortgage;
(o) any dispute between the Mortgagor or the Borrower and any
other person; and
(p) any agreement relating to any Secured Money being or
becoming void or unenforceable; or
(q) any new law or any change in any law or in the
interpretation of any law.
18.2.2 The Mortgagor indemnifies the Mortgagee, its directors and
any other officers in management and control of the Mortgagee at
any time, any Receiver and any agent of the Mortgagee against all
actions, fines, claims, demands, losses, damages, costs and
expenses of any nature incurred at any time actually or
contingently arising directly or indirectly from any breach of
any Environmental Protection Law in connection with the Mortgaged
Property.
18.2.3 The Mortgagor's obligations to indemnify the Mortgagee are
absolute, irrevocable and unconditional and continue
(irrespective of discharge of this mortgage) until an express
release is given. The Mortgagor waives any right or claim which
may have the effect of reducing or impairing the indemnities
given by it.
18.3 THE MORTGAGEE'S CERTIFICATE CONCLUSIVE
A certificate by the Mortgagee of its determination made in good faith
of the amount payable by the Mortgagor pursuant to this clause shall in
the absence of manifest error be conclusive and binding upon the
parties.
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19. EVENTS OF DEFAULT AND THE MORTGAGEE'S POWERS
19.1 MORTGAGOR TO PREVENT EVENTS OF DEFAULT
The Mortgagor must prevent the occurrence of an Event of Default and
acknowledges that it will be in default under this mortgage if an Event
of Default occurs.
19.2 EVENTS OF DEFAULT
An Event of Default occurs if:
(a) the Mortgagor or a Borrower fails to pay when payable any
Secured Money;
(b) the Mortgagor defaults in the performance or observance of
any other obligation owed or undertaking given to the
Mortgagee;
(c) a warranty, representation, answer to requisition or
statutory declaration made or given by or on behalf of any
Mortgagor, Borrower or Guarantor in connection with this
mortgage, any agreement relating to Secured Money or any other
security for Secured Money is found to be incorrect or
misleading;
(d) a Borrower or a Guarantor defaults in the performance of
any obligation owed to the Mortgagee pursuant to:
(d) an agreement under which a Borrower or a Guarantor has an
actual or contingent liability to pay any money which the
Mortgagor is also actually or contingently liable to pay;
(d) an agreement which relates to or is connected with any
agreement falling within sub-paragraph (i);
(d) any legal or equitable mortgage, charge or other security
of any nature and howsoever created or arising pursuant to
which the Borrower or Guarantor secures an obligation under an
agreement falling within sub-paragraphs (i) or (ii); or
(d) any undertaking;
(e) any of the following occurs in respect of a corporation
which is or is related to the Mortgagor or a Borrower or
Guarantor;
(e) an application is made, proceedings are initiated, a
resolution is passed or a meeting (whether of shareholders,
creditors or directors) is called with a view to winding it or
any part of its undertaking up or placing it or any part of
its undertaking under any kind of administration;
(e) an order is made that it be wound up;
(e) a receiver, liquidator or administrator is appointed to
any of its assets or undertaking or any such assets or
undertaking are placed in the hands of any judicial manager or
other court appointed manager or administrator;
(e) a compromise or arrangement of the kind referred to in
part 5.1 of the Corporations Law is proposed;
(e) a notice is published or given to the effect that its
registration may be cancelled or an application is made or an
action is initiated with a view to cancelling its registration
or appointing an inspector or other officer to investigate any
of its affairs pursuant to any legislation;
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(e) it is, or is or may be deemed under any applicable law to
be, insolvent or unable to pay its debts; or
(e) circumstances exist which would enable the court upon
application to order its winding up pursuant to section 461 of
the Corporations Law;
(f) any of the following occurs in respect of an individual
who is the Mortgagor or a Borrower or Guarantor:
(f) he or she commits an act of bankruptcy within the meaning
of section 40 of the Bankruptcy Act 1966 or proposes any
composition or scheme of arrangement with any creditors or any
assignment for the benefit of any creditors; or
(f) he or she dies or becomes incapable of managing his or her
own affairs by reason of mental or other condition;
(g) any of the following occurs in respect of a partnership
which is the Mortgagor or a Borrower or Guarantor or which has
the Mortgagor or a Borrower or Guarantor as a member and
carries on business on the Mortgaged Property:
(g) the dissolution or any application for the dissolution of
the partnership;
(g) the appointment or any application for the appointment of
a receiver; or
(g) the retirement within any period of 6 months of more than
20% of the members of the partnership without the Mortgagee's
consent;
(h) distress is levied or a judgment or order is enforced or
executed on or against any assets of the Mortgagor or a
Borrower or Guarantor or any of those assets are attached to
answer any judgment debt;
(i) a judgment for an amount in excess of 1% of the Secured
Money is entered in any court against the Mortgagor or a
Borrower or Guarantor and not satisfied, appealed or set aside
within 28 days;
(j) any assets of the Mortgagor or a Borrower or Guarantor are
confiscated, cancelled or forfeited;
(k) the Mortgagor or a Borrower or Guarantor stops payment of
its debts or ceases or threatens to cease to carry on any of
its businesses;
(l) any legislation is passed or anything else occurs which in
the reasonable opinion of the Mortgagee materially and
adversely affects any of its rights under this mortgage or any
other security for Secured Money ;
(m) a provision of this mortgage or any other security for
Secured Money does not or ceases to have full effect to the
Mortgagee's reasonable satisfaction;
(n) the Mortgagor or a Borrower or Guarantor which is a
company reduces or attempts to reduce its capital, alters or
proposes to alter its articles of association or directly or
indirectly acquires or proposes to acquire its own shares
without the Mortgagee's consent;
(o) the holder of any security given at any time over any
assets of the Mortgagor or a Borrower or Guarantor becomes
entitled to exercise any powers arising on default pursuant to
that security or otherwise take action to enforce that
security;
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(p) a person who has provided credit or financial
accommodation to the Mortgagor or a Borrower or Guarantor
becomes entitled to accelerate any obligation of the Mortgagor
or that Borrower or Guarantor to pay money to that person;
(q) the Mortgagor fails to duly comply with a condition
attaching to a consent or approval issued by the Mortgagee in
the context of this mortgage;
(r) the Mortgaged Property is damaged or destroyed or becomes
affected by any proposal to an extent that, in the Mortgagee's
reasonable opinion, its value (ignoring any insurance claim or
compensation) is reduced by more than 5%;
(s) where the Mortgagor is a corporation listed on a stock
exchange, its shares are suspended from quotation because of a
breach of any listing or other rules of that stock exchange;
(t) where the Mortgagor is a corporation which is not listed
on a recognised Australian stock exchange, there is a change
in the ownership (at the date of this mortgage) of more than
25% of the issued voting shares in the Mortgagor or there is a
change in the control of the Mortgagor without the Mortgagee's
consent;
(u) in the Mortgagee's opinion, there is any change in the
activities of the Mortgagor or a Borrower or Guarantor which
could materially and adversely affect the ability of that
person to meet any of its obligations to the Mortgagee;
(v) the Mortgagor ceases to carry on the whole or a
substantial part of any business at any time carried on by it
on the Mortgaged Property or disposes of the assets of or any
interest in any such business or any licence or other right in
connection with any such business is disposed of cancelled or
not renewed;
(w) in respect of a breach of or liability arising under any
Environmental Protection Law or Heritage Act in relation to
the Mortgaged Property, a notice is served on the Mortgagor
and not complied with or a notice is served on the Mortgagee;
(x) any proceedings are commenced against the Mortgagor or any
occupier of the Mortgaged Property pursuant to a breach of any
Environmental Protection Law or Heritage Act in respect of the
Mortgaged Property;
(y) without limiting the operation of any other Event of
Default, any other event occurs or circumstance arises or
becomes known to the Mortgagee, financial or otherwise, which,
in the opinion of the Mortgagee, is likely to materially and
adversely affect:
(y) the ability of the Mortgagor or any other person actually
or contingently liable to pay the Secured Money;
(y) the ability of the Mortgagor to comply with its
obligations under this mortgage;
(y) the Mortgagee's security under this mortgage;
(y) the value of the Mortgaged Property; or
(y) the ability of a Borrower to duly perform its obligations
to the Mortgagee; or
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(z) Moran Australia or Moran Group defaults in the performance
of any of their respective obligations under the Capex
Agreement, and does not remedy or rectify such breach in
accordance with the Capex Agreement.
19.3 NO DEFAULT CERTIFICATE
At the request of the Mortgagee, the Mortgagor must give the Mortgagee
a certificate signed by the Mortgagor (or where a company, by 2
directors) stating whether or not an Event of Default has occurred or
is likely to occur.
19.4 NOTIFICATION OF EVENTS OF DEFAULT
The Mortgagor must immediately notify the Mortgagee of the occurrence
of an Event of Default or the existence of any circumstance which may
lead to the occurrence of an Event of Default.
19.5 TERMINATION OF TRANSACTIONS AND PAYMENT OF PRIOR MORTGAGEES
Whether or not the Mortgagee has demanded payment of the Secured Money,
the Mortgagee may at any time following the occurrence of an Event of
Default in the manner and at the times which it considers appropriate
(irrespective of any omission, neglect or delay):
(a) terminate or reverse any transaction or arrangement
entered into by the Mortgagee at the express or implied
request or with the express or implied consent of the
Mortgagor;
(b) enter into any transaction and make any payment to
extinguish, set off or hedge in any way any actual or
contingent liability incurred by the Mortgagee at the express
or implied request or with the express or implied consent of
the Mortgagor;
(c) dishonour any cheque, close any account and open any new
account
(d) convert (directly or indirectly) the currency of any
obligation of the Mortgagor to the Mortgagee to another
currency; or
(e) pay any other mortgagee or encumbrancee of the Mortgaged
Property any amount required to discharge or purchase (with or
without a transfer of its security) its debt.
The Mortgagor must reimburse the Mortgagee all payments made and costs
and expenses incurred pursuant to anything done under this clause.
19.6 THE MORTGAGEE'S POWERS AND RIGHTS
Whether or not the Mortgagee has demanded payment of the Secured Money
the Mortgagee may at any time following the occurrence of an Event of
Default in the manner and at the times which it considers appropriate
(irrespective of any omission, neglect or delay):
(a) enter, seize, take possession of, manage and use the
Mortgaged Property;
(b) receive and give receipts for proceeds, rents and profits
in relation to the Mortgaged Property or any other property
mortgaged or charged by this mortgage;
(c) use the Mortgaged Property for any purpose (including,
without limitation, for grazing or agricultural or
horticultural purposes) or carry on any business on the
Mortgaged Property;
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(d) take any action it considers necessary or desirable for
the preservation, maintenance or enhancement of the Mortgaged
Property or its value;
(e) commence, conduct, defend, compromise, settle, discontinue
or submit to arbitration any proceedings, claims, questions or
disputes in connection with the Mortgaged Property or this
mortgage;
(f) exercise any rights and discretions of the Mortgagor in
connection with the Mortgaged Property;
(g) perform obligations of the Mortgagor in connection with
the Mortgaged Property under this mortgage or otherwise;
(h) renew, terminate, repudiate, rescind, vary, accept
surrenders of, exercise any rights under and take any legal
action in connection with any contract entered into by the
Mortgagor, any predecessor in title or the Mortgagee (pursuant
to the powers in this mortgage or at general law) in
connection with the Mortgaged Property;
(i) deal in any way with the Mortgaged Property, any estate or
interest in it, any right attaching to it or any encumbrance
affecting it;
(j) sell, surrender, exchange or otherwise dispose of the
Mortgaged Property upon any terms and in any manner;
(k) sever any fixtures to the Mortgaged Property and dispose
of them upon any terms and in any manner;
(l) remove and place in storage any personal property of the
Mortgagor left on the Mortgaged Property (but without being
liable for any damage or loss);
(m) grant for any period and upon any terms an option to
purchase, lease or acquire an interest in the Mortgaged
Property;
(n) grant leases, licences, agistments, easements and other
interests in or rights over the Mortgaged Property upon any
terms and (in the case of leases, licences and agistments) for
any period;
(o) in the name and on behalf of the Mortgagor or otherwise,
borrow or obtain any form of financial accommodation from the
Mortgagee or any other person upon any terms in connection
with any power of the Mortgagee under this mortgage or at
general law;
(p) secure upon any terms and in any manner any money borrowed
or liability incurred by charge or mortgage over the Mortgaged
Property whether ranking in priority to, equally with or after
this mortgage;
(q) demolish, replace, repair, alter, construct and affix any
improvements, fixtures or plant and equipment on or to the
Mortgaged Property;
(r) redevelop the Mortgaged Property or carry on any
development commenced on the Mortgaged Property with any
variations the Mortgagee considers appropriate;
(s) effect or cancel any insurance in relation to the
Mortgaged Property or the exercise of any of these powers and
make claims, sue for, recover, settle, compromise or otherwise
deal with any right to receive proceeds of insurances;
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(t) acquire in the name of the Mortgagor or otherwise any
property upon any terms and in any manner for use in
connection with the Mortgaged Property and in the name of the
Mortgagor grant a mortgage over the acquired property to the
Mortgagee as security for the Secured Money;
(u) change the use or nature of the Mortgaged Property or any
title to the Mortgaged Property;
(v) delegate in any manner any of its powers and rights under
this mortgage or at general law;
(w) expend money, assume obligations and incur liabilities in
exercising any power and right under this mortgage or at
general law;
(x) pay any money owing by the Mortgagor in respect of any
chattel used by the Mortgagor on the Mortgaged Property or
which has been leased by the Mortgagor to any lessee or
licensee of the Mortgaged Property;
(y) exercise the same powers over any other property mortgaged
or charged by this mortgage as it has in respect of the
Mortgaged Property;
(z) upon any terms and in any manner employ persons and engage
agents, contractors, consultants, advisers, auctioneers and
other persons in connection with the powers and rights of the
Mortgagee under this mortgage or at general law; and
(aa) do anything to protect the interest of the Mortgagor or
the Mortgagee in the Mortgaged Property, to protect the
enforceability, validity and priority of this mortgage or to
recover the Secured Money;
19.7 EXERCISE OF POWERS BY AGENT
The Mortgagee may exercise its powers under this mortgage or general
law by itself or through any agent. The fees charged by any agent must
be paid by the Mortgagor.
19.8 OUTSTANDING NEGOTIABLE INSTRUMENTS DO NOT AFFECT THE MORTGAGEE'S
RIGHTS
The Mortgagee may demand payment of Secured Money and exercise its
other rights under clauses 19 and 20 and at general law notwithstanding
that Secured Money arises under or is evidenced by any negotiable
instrument, security, contract or other obligation which is still
current or has not matured or fallen due.
19.9 ENVIRONMENTAL AUDIT BEFORE TAKING POSSESSION
The Mortgagor irrevocably authorises the Mortgagee and its consultants,
following the occurrence of an Event of Default, to go on to the
Mortgaged Property for the purposes of carrying out an environmental
audit of the Mortgaged Property and the Mortgagor's activities on the
Mortgaged Property. The Mortgagor must, upon request, make available
the Mortgagor's records relating to the Mortgaged Property and its use.
The Mortgagor must upon demand reimburse the Mortgagee the costs
incurred in carrying out the audit.
20. RECEIVERS AND THEIR POWERS
20.1 APPOINTMENT, REMOVAL AND REPLACEMENT
20.1.1 Whether or not the Mortgagee has demanded payment of the
Secured Money, the Mortgagee may at any time following the
occurrence of an Event of Default (irrespective of any omission,
neglect, delay or waiver) appoint one or more persons
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to be jointly, severally or jointly and severally a Receiver of
any of the Mortgaged Property or any other property mortgaged or
charged by this mortgage.
20.1.2 The Mortgagee may appoint a Receiver under this mortgage
notwithstanding the bankruptcy or insolvency of the Mortgagor.
20.1.3 The Mortgagee may appoint any person to replace any
Receiver who has been removed or who has retired or died.
20.1.4 The Mortgagee may by written notice to a Receiver remove
that Receiver absolutely or in relation to any part of the
Mortgaged Property.
20.1.5 The provisions of the Property Law Act 1974 and (if
applicable) the Corporations Law dealing with Receivers shall be
varied and extended to the extent provided in clause 21.
20.2 RECEIVER'S REMUNERATION
20.2.1 The Mortgagee may fix the remuneration of a Receiver and
at any time by agreement with that Receiver vary that Receiver's
remuneration.
20.2.2 The Mortgagor must pay a Receiver's remuneration and all
costs, charges and expenses paid or incurred by him or her as
Receiver. From money received the Receiver may retain his or her
remuneration and (except where they arise because of the wilful
misconduct or gross negligence of the Receiver) the costs,
charges and expenses incurred by him or her as Receiver and money
on account of other liabilities incurred actually or contingently
by him or her as Receiver.
20.3 RECEIVER AGENT OF THE MORTGAGOR
Unless otherwise prevented by law, a Receiver will be the agent of the
Mortgagor. The Mortgagor agrees to be responsible for each Receiver's
acts and omissions.
20.4 RECEIVER'S POWERS
Subject to any express limitation in his appointment, a Receiver may
exercise the same powers as those of the Mortgagee under this mortgage
the Property Law Act 1974 (if applicable), the Corporations Law and at
general law including, without limitation, the powers listed in clause
19.6.
21. PROVISIONS RELATING TO THE MORTGAGEE'S AND RECEIVER'S POWERS
21.1 POWERS ARE IN ADDITION TO STATUTORY POWERS
The powers of the Mortgagee and a Receiver under this mortgage are
independent of and in addition to any other legal, equitable or
statutory powers and free of any limitation affecting any statutory
power.
21.2 WAIVER OF STATUTORY NOTICES AND TIME
21.2.1 To the extent that any legislation is not contravened the
Mortgagor agrees that any notice or lapse of time before the
Mortgagee or a Receiver can exercise any option, power or right
is not necessary.
21.3 PROTECTION OF PURCHASERS
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The Mortgagor agrees that any person dealing with the Mortgagee or any
Receiver need not be concerned whether any power of the Mortgagee or
Receiver has arisen or with the propriety of any transaction undertaken
by the Mortgagee or any Receiver even if it has actual notice to the
contrary.
21.4 SPECIFIC AUTHORITY TO EXERCISE POWERS
The Mortgagor irrevocably and unconditionally authorises the Mortgagee
and any Receiver to exercise its powers under this mortgage or any
legislation notwithstanding that the Event of Default giving rise to
exercise of such powers may subsequently be deemed never to have
occurred. In such circumstances the Mortgagor:
(a) does not have any claim against the Mortgagee or a
Receiver for trespass or for any loss suffered by the
Mortgagor other than because of fraud or gross negligence on
the part of the Mortgagee or a Receiver; and
(b) indemnifies the Mortgagee and any Receiver against any
claim or loss arising other than because of fraud or gross
negligence.
21.5 PROTECTION OF THE MORTGAGEE AND RECEIVER
The Mortgagor agrees that the Mortgagee and any Receiver are not liable
for any loss which may arise because of any omission or delay in the
exercise of any of their respective powers under this mortgage or any
legislation.
21.6 MONEY OUTLAID IS SECURED
The Mortgagor must upon demand pay any money outlaid or liability
incurred by the Mortgagee or any Receiver in exercising powers under
this mortgage or at general law.
21.7 ENTITLEMENT TO CHARGE COMMISSIONS
The Mortgagee and the Receiver (if permitted by the Mortgagee) may, in
addition to any fee or other charge, charge a commission in connection
with the management of and collection of income from the Mortgaged
Property to the extent that those tasks have not been delegated to an
agent.
21.8 THE MORTGAGEE MAY GIVE UP POSSESSION OF MORTGAGED PROPERTY
The Mortgagee may at any time give up possession of the whole or any
part of the Mortgaged Property or retire any Receiver from the whole or
any part of the Mortgaged Property.
21.9 APPLICATION OF MONEYS
The Mortgagee shall stand possessed of moneys actually received by it
as a result of the exercise of its rights and powers under this
mortgage upon trust to apply as follows:
(a) first, in or towards payment of that part of the Secured
Money being costs, charges and expenses incurred by the
Mortgagee or the Receiver in the exercise, performance or
enforcement or attempted exercise, performance or enforcement
of any rights or powers under this mortgage;
(b) secondly, in or towards payment of such other outgoings as
the Mortgagee or the Receiver shall think fit to pay;
(c) thirdly, in or towards payment to the Receiver of any
remuneration whether by way of commission or otherwise;
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(d) fourthly, in or towards payment of the Secured Money,
and the surplus (if any) will belong to the Mortgagor or other persons
entitled to it but;
(e) the surplus will not carry interest; and
(f) the Mortgagee or the Receiver may pay the surplus to the
credit of a bank account in the name of the Mortgagor or other
persons entitled to it and will thereupon be under no further
liability in respect of it.
21.10 INSTALMENTS
If during the currency of any notice delivered by the Mortgagee to the
Mortgagor pursuant to Section 84 of the Property Law Act 1974:
(a) any instalment (a "current instalment") of principal
and/or interest falls due for payment by the Mortgagor; and
(b) the Mortgagee receives any moneys or credits under this
Mortgage;
the Mortgagor irrevocably directs the Mortgagee to apply such moneys or
credits:
(b) first, in satisfaction of each current instalment; and
(b) secondly, towards satisfaction or reduction of the arrears
specified in any such notice.
22. POWER OF ATTORNEY
22.1 APPOINTMENT OF ATTORNEY
For valuable consideration, the Mortgagor irrevocably appoints the
Mortgagee and its directors and employees and each Receiver severally
its attorneys with power in the name of the attorney or the Mortgagor
to:
(a) perform any obligation owed by the Mortgagor at any time
to the Mortgagee;
(b) complete any blanks and correct any manifest errors in
this mortgage or agree or give effect to any such completion
or correction and do all things necessary to procure the
registration of this mortgage as a valid security;
(c) after the occurrence of an Event of Default, do anything
in connection with the Mortgaged Property which the Mortgagor
could do including, without limitation, the execution or
signing of any transfer, lease, mortgage, charge or other
dealing or application;
(d) delegate its powers to any person for any period and
revoke such delegation;
(e) prove and do anything else the Mortgagor can do in
connection with the bankruptcy or insolvency of any Borrower,
Guarantor or another Mortgagor;
(f) exercise any security referred to in clause 24.6;
(g) do anything in exercise of any right of indemnity referred
to in clause 14.4 or to enable direct access or recourse to
trust assets for the purposes of clause 14.4; and
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(h) where clause 11 applies, do anything which the Mortgagor
may lawfully authorize an attorney to do in connection with
the Licence including, without limitation, executing deeds,
instituting, conducting and defending legal proceedings,
applying for or obtaining the continuation, transfer or
removal of the Licence and signing all notices, transfers,
applications and documents for that purpose.
If the Mortgagor does not hold the Licence referred to in paragraph (h)
the Mortgagor must upon request promptly procure that the person who
holds the Licence gives a power of attorney in favour of the Mortgagee
or the Receiver in the same terms as are contained in clause 22.1(h).
22.2 CONFLICTS OF DUTY
An attorney may act notwithstanding any conflict of duty or a direct or
personal interest in the means or result.
22.3 ATTORNEY'S INDEMNITY AND COSTS
22.3.1 The Mortgagor indemnifies each attorney against any
liability or loss arising from the exercise of any powers under
this mortgage.
22.3.2 The Mortgagee may indemnify any attorney in connection
with the exercise of its powers and the Mortgagor must reimburse
any money paid pursuant to any such indemnity.
22.4 RATIFICATION
The Mortgagor and the Borrower each agree to ratify and confirm all and
whatsoever an attorney or his substitute or substitutes shall lawfully
do or cause to be done by virtue of the foregoing power of attorney or
this Mortgage and not to contravene or contradict the same.
22.5 POWER OF ATTORNEY BY WAY OF SECURITY
The foregoing power of attorney being given for valuable consideration
and by way of security is hereby agreed and declared to be irrevocably
notwithstanding the death, incapacity, winding up, dissolution or other
demise of the Mortgagor and/or the Borrower.
23. PRESERVATION OF THE MORTGAGEE'S RIGHTS
23.1 GENERAL PRESERVATION OF RIGHTS
This is a continuing security. The liabilities of the Mortgagor under
this mortgage and the rights of the Mortgagee, a Receiver or an
attorney of the Mortgagor appointed under this mortgage are not
affected by:
(a) the Mortgagee granting any time or indulgence to the
Mortgagor, any Borrower or another person;
(b) the Mortgagee compounding or compromising with or wholly
or partially releasing any Borrower, Guarantor or other
person;
(c) laches, acquiescence, delay, acts, omissions or mistakes
by the Mortgagee, Receiver or another person;
(d) the Mortgagee taking, varying, wholly or partially
discharging or otherwise dealing with or losing or impairing
any other security for Secured Money;
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(e) any security for or obligation to pay Secured Money being
or becoming void, voidable or unenforceable;
(f) any person who was intended to assume any actual or
contingent liability to pay Secured Money not doing so or not
doing so effectively or being discharged;
(g) the death, insolvency, bankruptcy or deregistration of any
person;
(h) any other transaction or arrangement between the Mortgagee
or any other person; or
(i) anything else which might otherwise have such affect at
law or in equity.
23.2 NO MERGER
The Mortgagee's right to payment of Secured Money arising under any
other instrument does not merge with the Mortgagor's undertaking to pay
Secured Money under this mortgage. This mortgage does not merge with or
affect any other security or any judgement or order held at any time by
the Mortgagee.
23.3 PARTNERSHIP MORTGAGOR
Where Secured Money includes any partnership indebtedness this
mortgage continues to be binding notwithstanding any changes in the
partnership (including changes which result in the partnership
business being carried on by one person) and Secured Money includes
the indebtedness of the partnership following any such change. The
Mortgagee is under no obligation to release any Mortgagor who has
ceased to be a member of the partnership comprising the Mortgagor.
23.4 NEW AND SUSPENSE ACCOUNTS
23.4.1 The Mortgagee may without notice open up any new account
of the Mortgagor with the Mortgagee and credit the new account
with any credit in any other account or any new receipt.
23.4.2 In the event of the liquidation of a Borrower, a Guarantor
or another Mortgagor the Mortgagee may retain and carry to a
suspense account and appropriate at its discretion all money
received by any Receiver, any attorney or the Mortgagee under or
by virtue of this mortgage and prove for the full amount of the
Secured Money.
23.5 MORTGAGOR NOT TO PROVE IN COMPETITION OR CLAIM SUBROGATION
The Mortgagor must not, without the Mortgagee's prior written consent:
(a) other than by its attorney appointed under this mortgage
prove in the bankruptcy or insolvency of a Borrower, Guarantor
or another Mortgagor or claim or receive the benefit of any
dividend, distribution or other payment pursuant to that
bankruptcy or insolvency; or
(b) directly or indirectly claim the benefit of any right,
power, remedy or security held by the Mortgagee or of any
distribution, dividend or payment arising out of or relating
to the liquidation of the Borrower or any other person,
until the Secured Money has been paid in full to the Mortgagee.
23.6 NO ORDER IN EXERCISE OF SECURITIES
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The Mortgagee may exercise its security under this mortgage and any
other security for Secured Money in any order it wishes. The Mortgagor
waives any right of marshalling against the Mortgagor or otherwise in
relation to this mortgage or any other security for Secured Money. The
Mortgagee is not under any obligation to appropriate in favour of the
Mortgagor or to exercise, apply or recover any security for Secured
Money or any fund or asset that the Mortgagee may be entitled to
receive or have a claim upon.
23.7 REINSTATEMENT OF THE MORTGAGEE'S RIGHTS
If any claim that a payment, obligation, settlement, transaction,
conveyance or transfer in connection with Secured Money (or money which
would be Secured Money if the claim was invalid) is void or voidable
under any law relating to insolvency, bankruptcy or the protection of
creditors is upheld, conceded or compromised:
(a) the Mortgagee is entitled immediately as against the
Mortgagor to the rights in respect of the Secured Money to
which it would have been entitled if all or part of that
payment, obligation, settlement, transaction, conveyance or
transfer had not taken place; and
(b) the Mortgagor agrees to immediately do any act or sign any
document at the Mortgagee's request to restore the Mortgagee
to any security or guarantee held by it from the Mortgagor
immediately before that payment, obligation, settlement,
transaction, conveyance or transfer.
24. FURTHER ASSURANCES
24.1 PERFECTION OF SECURITY
The Mortgagor must immediately upon request by the Mortgagee do acts,
obtain consents, pay fees and execute deeds and other documents deemed
necessary or desirable by the Mortgagee:
(a) to perfect any mortgage or charge pursuant to this
mortgage or otherwise created or intended to be created by the
Mortgagor as security for any Secured Money;
(b) to effect any mortgage or charge agreed to be given
pursuant to this mortgage;
(c) to enable the exercise of the Mortgagee's rights and
powers under this mortgage and at general law;
(d) to effect the security and priority intended by this
mortgage and the Mortgagee;
(e) to more effectively secure the Mortgaged Property to the
Mortgagee; and
(f) to give the Mortgagee a legal mortgage over any property
mortgaged or charged under this mortgage.
24.2 PROPERTY SUBSEQUENTLY ACQUIRED
The Mortgagor agrees that it will immediately give the Mortgagee a
mortgage with an equivalent ranking to this mortgage over:
(a) any freehold or other interest in land acquired at any
time for use in conjunction with the Mortgaged Property or
appended at any time to the Mortgaged Property;
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(b) any freehold or other interest in land acquired at any
time pursuant to any exchange involving Mortgaged Property;
and
(c) any other interest or tenure acquired at any time in or
pursuant to the Mortgaged Property.
24.3 ASSIGNMENT OF INCOME
24.3.1 To the extent permitted by law the Mortgagor absolutely
assigns to the Mortgagee as security for Secured Money the
Mortgagor's right to receive premiums, rents or licence or other
fees under any lease, licence or other agreement at any time
relating to the Mortgaged Property. At any time the Mortgagee may
and the Mortgagor must upon request perfect this as a legal
assignment.
24.3.2 The Mortgagor absolutely assigns to the Mortgagee as
security for the Secured Money any guarantee, bond, deposit, bank
guarantee or other instrument or property held as security for
premiums, rents or licence or other fees under any lease, licence
or other agreement at any time relating to the Mortgaged
Property. At any time the Mortgagee may and the Mortgagor must
upon request perfect this as a legal assignment.
24.3.3 The Mortgagee will not be deemed to have taken possession
of any Mortgaged Property by virtue of this clause or anything
done pursuant to this clause.
24.4 ASSIGNMENT OF LICENCES AND OTHER RIGHTS
Unless forbidden by any legislation the Mortgagor absolutely assigns to
the Mortgagee as security for the Secured Money all its right, title
and interest in any licence, permission, approval, trademark, business
name, quota or other right attached, existing or used in relation to
the Mortgaged Property. At any time the Mortgagee may and the Mortgagor
must upon request perfect this as a legal assignment.
24.5 CONTRACTS FOR SALE OF MORTGAGED PROPERTY
Whether or not the Mortgagee has approved any such dealing, the
Mortgagor assigns to the Mortgagee the whole of its interest in and
claim to any deposit, bond, premium or other sum paid or payable in
connection with any sale, lease or other dealing with the Mortgaged
Property or any part. The Mortgagor will hold any such deposit, bond,
premium or other sum it receives for the Mortgagee.
24.6 MORTGAGOR'S SECURITY FROM BORROWER
The Mortgagor agrees to hold any indemnity (together with any security
for that indemnity) from any Borrower in respect of its liability under
this mortgage in trust for the Mortgagee.
25. DISCHARGES
24.6 MORTGAGOR'S RIGHT TO A DISCHARGE
Upon payment of all Secured Money the Mortgagee must execute a
discharge except where the Mortgagee considers that any money will or
may become actually, contingently or prospectively owing by the
Mortgagor to the Mortgagee:
(a) because a payment made to the Mortgagee could be voided
under any law relating to insolvency, bankruptcy or the
protection of creditors or for any other reason; or
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(b) as a result of any claim or action the Mortgagee has
against the Mortgagor, any Borrower or Guarantor or other
person.
25.2 SURVIVAL OF PERSONAL COVENANTS AND AGREEMENTS
Any personal covenant or agreement by the Mortgagor to pay Secured
Money or any indemnity by the Mortgagor in favour of the Mortgagee in
this mortgage remains in full force despite any release or discharge in
part or whole.
26. THE MORTGAGEE'S RIGHT TO ASSIGN
26.1 ASSIGNMENT
The Mortgagee may at any time assign or deal in any way with its
interest in Secured Money or its rights under this mortgage. Provided
the Mortgagor's aggregate liability is not thereby increased it must,
at the request and cost of the Mortgagee, sign any deed or other
document reasonably required by the Mortgagee pursuant to any such
assignment or dealing.
26.2 DISCLOSURE OF INFORMATION
The Mortgagee may without notice to the Mortgagor disclose information
relating to the Mortgagor, a Borrower, a Guarantor, the Mortgaged
Property or Secured Money in connection with a proposal to assign any
interest in Secured Money or this mortgage.
27. COSTS
27.1 MORTGAGOR TO PAY ALL COSTS
The Mortgagor must pay to the Mortgagee all costs and expenses
(including legal costs on a full indemnity basis and out of pocket
expenses) incurred by the Mortgagee (or any attorney of the Mortgagor
or a Borrower pursuant to clause 20) in connection with:
(a) the preparation, negotiation, stamping, registration,
variation, discharge or release of this mortgage and any
agreement varying or relating to this mortgage and any
associated investigation, enquiries and searches;
(b) the perfection of this mortgage or the Mortgagor's or the
Mortgagee's title or interest in the Mortgaged Property;
(c) the recovery of Secured Money;
(d) the occurrence of an Event of Default and the assessment
of the Mortgagee's securities, rights and duties;
(e) the valuation of the Mortgaged Property following an Event
of Default;
(f) the exercise or attempted exercise of any power conferred
on the Mortgagee or any Receiver pursuant to this mortgage or
by law or on any attorney pursuant to clause 20;
(g) any obligation the Mortgagee has at any time to the
Mortgagor pursuant to any legislation, this mortgage or any
transaction contemplated by this mortgage;
(h) the consideration of any application for its consent or
approval in connection with this mortgage and the grant or
refusal of consent or approval; and
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SCHEDULE
TITLE REFERENCE 15602076
(i) the assessment of the Mortgagor's position following the
occurrence of an Event of Default.
27.2 MORTGAGOR TO REIMBURSE FID
The Mortgagor must reimburse the Mortgagee all sums of financial
institutions duty, bank account debits tax and any other duties, taxes
or imposts incurred or payable by the Mortgagee in relation to the
advance and receipt of Secured Money.
27.3 MORTGAGOR TO PAY STAMP DUTY
The Mortgagor must pay immediately on demand by the Mortgagee and in
any case by their due date all stamp, loan security and other duties,
imposts, taxes and levies arising directly or indirectly in respect of
this mortgage, any variation or any transaction contemplated or
evidenced by this mortgage. The Mortgagor must reimburse the Mortgagee
any such duties, imposts, taxes and levies paid by the Mortgagee.
27.4 PAYMENT OF THE MORTGAGEE'S ADMINISTRATION FEE
The Mortgagor agrees to pay the Mortgagee upon demand a fee for the
time spent by employees of the Mortgagee in:
(a) considering any application for any approval or consent
required under this mortgage; and
(b) exercising its rights and powers and taking any action to
recover the Secured Money following the occurrence of an Event
of Default.
The fee will be calculated by reference to the hourly rates recommended
by the Insolvency Practitioners' Association of Australia from time to
time and the Mortgagee's determination of the equivalent seniority
levels of its employees.
28. GENERAL
28.1 SIGNING OF NOTICES BY THE MORTGAGEE
Any statement, demand or notice to the Mortgagor will be effectively
signed on behalf of the Mortgagee if it is executed or signed by the
Mortgagee, any director or secretary of the Mortgagee, any employee
whose title includes the word manager, president or vice-president, the
Mortgagee's solicitor or any person authorised by any of the above.
28.2 SERVICE OF NOTICES
In addition to effecting service pursuant to any statute, any
statement, demand or notice to any party may be validly served for the
purposes of this mortgage by being delivered or sent by registered post
to the address of the addressee or sent by telex or facsimile to the
telex or facsimile number of the addressee. The address and telex and
facsimile numbers of the parties for the purposes of this clause are
those set out in this mortgage or such others as are from time to time
notified in writing by the parties to all of the other parties. Service
pursuant to this clause is taken to be effected:
(a) where delivered - upon actual delivery;
(b) where sent by telex - upon receipt by the sender of the
answerback code of the addressee after transmission of the
telex; and
<PAGE> 345
FORM 20 Version 1 QUEENSLAND LAND REGISTRY
Land Title Act 1994 and Land Act 1994 Page 44 of 45
SCHEDULE
TITLE REFERENCE 15602076
(c) where sent by facsimile, on production of a transmission
report by the machine from which the facsimile was sent which
indicates that the facsimile was sent in its entirety to the
facsimile number of the recipient,
except where actual delivery is made or the telex or facsimile is sent
after 4.30 pm or on a day which is not a business day when service is
taken to be effected at 9.00 am on the next following business day.
28.3 REGISTRATION AND REQUISITIONS
The Mortgagor must upon demand by the Mortgagee procure registration of
this mortgage and any mortgage or encumbrance given pursuant to this
mortgage with the priority intended by the Mortgagee. The Mortgagor
must to the satisfaction of the Mortgagee promptly comply with any
requisition raised by any authority in connection with this mortgage,
its stamping and registration.
28.4 NO MORATORIUM
The provisions of any legislation postponing payment of money, reducing
or fixing rates of interest or purporting to curtail or restrict any
rights of the Mortgagee are to the extent that it is lawful expressly
excluded from application to this mortgage.
28.5 TIME OF THE ESSENCE FOR MORTGAGOR'S OBLIGATIONS
The Mortgagor agrees that time is of the essence in relation to the
performance of its obligations expressed in or implied by this
mortgage.
28.6 THE MORTGAGEE'S CONSENTS
28.6.1 Where the Mortgagee's consent or approval is required
pursuant to this mortgage:
(a) unless otherwise expressed it may in the Mortgagee's
discretion (and whether or not acting reasonably) be withheld
or given subject to terms or conditions; and
(b) it is not valid unless expressly given in writing by the
Mortgagee.
28.6.2 The Mortgagor must comply with the terms and conditions of
any consent.
28.6.3 The Mortgagee may engage consultants and advisers to
advise it in relation to any application for its approval or
consent under this mortgage. The costs of those consultants and
advisers must be reimbursed by the Mortgagor upon demand.
28.6.4 The Mortgagor agrees that the Mortgagee (and the
Mortgagee's employees and consultants) owes no duty of care to
the Mortgagor in issuing any consent or approval and that in
determining whether to proceed with the thing consented to or
approved the Mortgagor must rely entirely on its own judgment and
the advice of its own employees and consultants.
28.7 CERTIFICATE OF SECURED MONEY OWING
A certificate signed by the Mortgagee or any employee of the Mortgagee
will be conclusive evidence against the Mortgagor in the absence of
manifest error as to the amount of Secured Money then owing or payable.
28.8 SEVERABILITY OF PROVISIONS
<PAGE> 346
FORM 20 Version 1 QUEENSLAND LAND REGISTRY
Land Title Act 1994 and Land Act 1994 Page 45 of 45
SCHEDULE
TITLE REFERENCE 15602076
Every provision of this mortgage is independent of the others. Any
provision which is prohibited or unenforceable in any jurisdiction is
to the extent of the prohibition or unenforceability deemed removed
without invalidating the remaining provisions.
28.9 MORTGAGE IS A DEED
This mortgage is made as a deed and each party declares that by its
signature it has executed this mortgage as a deed in addition to giving
any certification required by any legislation.
28.10 APPLICABLE LAW
This mortgage is governed by the law of the place in which the
Mortgaged Property is situated. The parties irrevocably and
unconditionally submit to the non-exclusive jurisdiction of the court
system of that place.
28.11 ATTORNMENT
The Mortgagor attorns and becomes tenant from week to week to the
Mortgagee of the Mortgaged Property commencing on the date of this
mortgage at a weekly rental equal to and varying in amount with the
interest accruing under this Mortgage from day to day for one week (or
if no interest is payable, a rental of 1(cent) per week). Such rent is
to be paid by weekly payments if demanded by the Mortgagee but until
demanded to be paid on the days appointed for payment of interest (or
if no interest is payable, capital payments) under this mortgage. All
rent received by the Mortgagee by virtue of this attornment will be
applied towards satisfaction of the interest payable under this
mortgage. The Mortgagee may at any time after the Secured Money becomes
payable at the option of the Mortgagee without giving any previous
notice enter into and upon and take possession of the Mortgaged
Property whereof the Mortgagor has attorned as tenant and may determine
the tenancy created by this attornment. Neither the receipt of the rent
nor the tenancy created by the attornment will render the Mortgagee
liable to account as mortgagee in possession and nothing in this
attornment clause will prejudice or lessen the rights of the Mortgagee
as mortgagee or modify or add to the rights of the Mortgagor as
mortgagor or lessee, it being agreed that this attornment clause is for
the purpose of estoppel only. If this clause would otherwise be
construed as granting or affording to the Mortgagor any rights
privileges protections or immunities of a lessee under any statute or
at law or in equity which would not, except for this clause, be
available to the Mortgagor, then this clause will be deemed to be
severed from and will form no part of this mortgage.
<PAGE> 347
FORM 20 Version 1 QUEENSLAND LAND REGISTRY
Land Title Act 1994 and Land Act 1994 Page 46 of 45
SCHEDULE
TITLE REFERENCE 15602076
CONTENTS
1. DEFINITIONS AND INTERPRETATION ................................... 2
1.1 Definitions ...................................................... 2
1.2 Interpretation ................................................... 3
1.3 Joint and several ................................................ 4
1.4 Successors and assignees ......................................... 4
1.5 Headings and table of contents ................................... 4
1.6 References to and calculations of time ........................... 4
1.7 Corporate relationships .......................................... 4
2. PERFORMANCE OF MORTGAGOR'S OBLIGATIONS GENERALLY ................. 5
2.1 Performance of all obligations ................................... 5
2.2 The Mortgagee's right to remedy .................................. 5
2.3 Subsequent Mortgage and Tacking .................................. 5
3. PAYMENT OF SECURED MONEY ......................................... 6
3.1 Obligation to pay and time for payment ........................... 6
3.2 No pre-condition to demanding payment of Secured Money ........... 6
3.3 Payment following an Event of Default ............................ 6
3.4 Payment without deduction or set-off ............................. 6
3.5 Credit for payment ............................................... 6
3.6 Application of payments .......................................... 6
3.7 Set-off against other accounts ................................... 7
3.8 Overpayment ...................................................... 7
3.9 Payment in wrong currency ........................................ 7
3.10 Interest ......................................................... 7
4. INSURANCE OBLIGATIONS ............................................ 7
4.1 Building insurance ............................................... 7
4.2 Public liability and other insurances ............................ 8
4.3 Endorsement to protect against Mortgagor's non-disclosure ........ 8
4.4 General insurance obligations .................................... 8
4.5 Assignment of insurance proceeds 8
5. POSITIVE OBLIGATIONS RELATING TO THE MORTGAGED PROPERTY .......... 8
5.1 Repair, security and rectification of defects .................... 8
5.2 Outgoings ........................................................ 9
5.3 Title documents .................................................. 9
5.4 Compliance with obligations ...................................... 9
5.5 Business ......................................................... 9
5.6 Rectification of encroachments ................................... 9
5.8 Maintenance of approvals ......................................... 9
5.9 Enhancement of security .......................................... 10
5.10 Information ...................................................... 10
5.11 Environmental risk management .................................... 10
6. PROHIBITIONS IN RELATION TO MORTGAGED PROPERTY ................... 11
6.1 Dealings and encumbrances ........................................ 11
6.3 Demolition, alterations and changes to nature and title .......... 11
6.4 Value, saleability and security .................................. 12
6.5 Increases in amounts secured by other charges .................... 12
6.6 Use .............................................................. 12
7. PROVISIONS APPLYING TO STRATA TITLE .............................. 12
<PAGE> 348
FORM 20 Version 1 QUEENSLAND LAND REGISTRY
Land Title Act 1994 and Land Act 1994 Page 47 of 45
SCHEDULE
TITLE REFERENCE 15602076
7.1 Application of clause 7 .......................................... 12
7.2 Insurance ........................................................ 12
7.3 Voting ........................................................... 13
7.4 Information ...................................................... 13
7.5 Additional Events of Default ..................................... 13
7.6 Notices .......................................................... 13
7.7 Authority to obtain information .................................. 14
7.8 Covenants ........................................................ 14
8. FOREIGN OWNERSHIP OF LAND REGISTER ACT ........................... 14
8.1 Warranties Relating to the Foreign Ownership of Land Register
Act............................................................... 14
8.2 Obligations of the Mortgagor ..................................... 14
9. ENVIRONMENTAL PROVISIONS ......................................... 15
9.1 Application of Clause 9 .......................................... 15
9.2 Obligations of the Mortgagor ..................................... 15
9.3 Warranties by the Mortgagor ...................................... 15
9.4 Indemnity by Mortgagor ........................................... 15
10. HERITAGE LEGISLATION ............................................. 16
10.1 Application of Clause 10 ......................................... 16
10.2 Heritage Register ................................................ 16
10.3 Entry on or removal from Heritage Register ....................... 16
10.4 Certificate of Immunity .......................................... 17
10.5 Compliance with Heritage Act ..................................... 17
10.6 Heritage Agreement ............................................... 17
10.7 The Mortgagee's costs and expenses ............................... 17
11. PROVISIONS APPLYING TO LIQUOR ACT LICENCES ....................... 17
11.1 Application of clause 11 ......................................... 17
11.2 Special obligations relating to licensed premises ................ 17
11.3 Additional Events of Default ..................................... 18
11.4 Procedures after an Event of Default ............................. 18
12. PROVISIONS APPLYING TO AGRICULTURAL LAND ......................... 18
12.1 Application of clause 12 ......................................... 18
12.2 Special obligations relating to agricultural land ................ 18
13. PROVISIONS APPLYING TO CROWN LANDS ............................... 19
13.1 Application of clause 13 ......................................... 19
13.2 Obligations of the Mortgagor ..................................... 19
14. PROVISIONS APPLYING TO A TRUSTEE MORTGAGOR ....................... 19
14.1 Application of clause 14 ......................................... 19
14.2 Warranties relating to the Trust 20
14.3 Financial information ............................................ 20
14.4 Mortgagor's right of indemnity ................................... 20
14.5 New trustees ..................................................... 21
14.6 Mortgagor's liability unlimited .................................. 21
15 PROVISIONS APPLYING TO WORKS ON MORTGAGED PROPERTY................ 21
15.1 Consents required in relation to Works ........................... 21
15.2 Lodgement of plans and author's licence .......................... 21
15.3 Carrying out of Works ............................................ 21
15.4 Reporting on Works ............................................... 22
15.5 Insurances ....................................................... 22
15.6 Retention money .................................................. 22
15.7 Completion certificates .......................................... 22
<PAGE> 349
FORM 20 Version 1 QUEENSLAND LAND REGISTRY
Land Title Act 1994 and Land Act 1994 Page 48 of 45
SCHEDULE
TITLE REFERENCE 15602076
15.8 Manufacturer's warranties ........................................ 22
16. THE MORTGAGEE'S RIGHT OF ACCESS .................................. 22
17. COMPENSATION ARISING IN RELATION TO MORTGAGED PROPERTY ........... 23
17.1 Notification of proposals ........................................ 23
17.2 Compensation benefits ............................................ 23
18. WARRANTIES AND INDEMNITIES ....................................... 23
18.1 Warranties ....................................................... 23
18.2 Indemnities ...................................................... 24
18.3 The Mortgagee's certificate conclusive ........................... 25
19. EVENTS OF DEFAULT AND THE MORTGAGEE'S POWERS ..................... 25
19.1 Mortgagor to prevent Events of Default ........................... 25
19.2 Events of Default ................................................ 25
19.3 No default certificate ........................................... 28
19.4 Notification of Events of Default ................................ 28
19.5 Termination of transactions and payment of prior mortgagees ...... 28
19.6 The Mortgagee's powers and rights ................................ 29
19.7 Exercise of powers by agent ...................................... 30
19.8 Outstanding negotiable instruments do not affect the Mortgagee's
rights............................................................ 30
19.9 Environmental audit before taking possession ..................... 31
20. RECEIVERS AND THEIR POWERS ....................................... 31
20.1 Appointment, removal and replacement ............................. 31
20.2 Receiver's remuneration .......................................... 31
20.3 Receiver agent of the Mortgagor .................................. 31
20.4 Receiver's powers ................................................ 31
21. PROVISIONS RELATING TO THE MORTGAGEE'S AND RECEIVER'S POWERS ..... 32
21.1 Powers are in addition to statutory powers ....................... 32
21.2 Waiver of statutory notices and time ............................. 32
21.3 Protection of purchasers ......................................... 32
21.4 Specific authority to exercise powers ............................ 32
21.5 Protection of the Mortgagee and Receiver ......................... 32
21.6 Money outlaid is secured ......................................... 32
21.7 Entitlement to charge commissions ................................ 32
21.8 The Mortgagee may give up possession of Mortgaged Property ....... 32
21.9 Application of Moneys ............................................ 32
21.10 Instalments ...................................................... 33
22. POWER OF ATTORNEY ................................................ 33
22.1 Appointment of attorney .......................................... 33
22.2 Conflicts of duty ................................................ 34
22.3 Attorney's indemnity and costs ................................... 34
22.4 Ratification ..................................................... 34
22.5 Power of Attorney by Way of Security ............................. 34
23. PRESERVATION OF THE MORTGAGEE'S RIGHTS ........................... 34
23.1 General preservation of rights ................................... 34
23.2 No merger ........................................................ 35
23.3 Partnership Mortgagor ............................................ 35
23.4 New and suspense accounts ........................................ 35
23.5 Mortgagor not to prove in competition or claim subrogation ....... 35
23.6 No order in exercise of securities ............................... 35
23.7 Reinstatement of the Mortgagee's rights .......................... 36
<PAGE> 350
FORM 20 Version 1 QUEENSLAND LAND REGISTRY
Land Title Act 1994 and Land Act 1994 Page 49 of 45
SCHEDULE
TITLE REFERENCE 15602076
24. FURTHER ASSURANCES ............................................... 36
24.1 Perfection of security ........................................... 36
24.2 Property subsequently acquired ................................... 36
24.3 Assignment of income ............................................. 36
24.4 Assignment of licences and other rights .......................... 37
24.5 Contracts for sale of Mortgaged Property ......................... 37
24.6 Mortgagor's security from Borrower ............................... 37
25. DISCHARGES ....................................................... 37
25.1 Mortgagor's right to a discharge.................................. 37
25.2 Survival of personal covenants and agreements .................... 37
26. THE MORTGAGEE'S RIGHT TO ASSIGN .................................. 38
26.1 Assignment ....................................................... 38
26.2 Disclosure of information ........................................ 38
27. COSTS ............................................................ 38
27.1 Mortgagor to pay all costs ....................................... 38
27.2 Mortgagor to reimburse FID ....................................... 38
27.3 Mortgagor to pay stamp duty ...................................... 39
27.4 Payment of the Mortgagee's administration fee .................... 39
28. GENERAL .......................................................... 39
28.1 Signing of notices by the Mortgagee .............................. 39
28.2 Service of notices ............................................... 39
28.3 Registration and requisitions .................................... 39
28.4 No moratorium .................................................... 40
28.5 Time of the essence for Mortgagor's obligations................... 40
28.6 The Mortgagee's consents ......................................... 40
28.7 Certificate of Secured Money owing ............................... 40
28.8 Severability of provisions ....................................... 40
28.9 Mortgage is a deed ............................................... 40
28.10 Applicable law ................................................... 40
28.11 Attornment ....................................................... 41
<PAGE> 351
WAREHOUSE FACILITY AGREEMENT
Date:
PRINCIPAL HEALTHCARE FINANCE PTY LIMITED
Initial Borrower
ABN AMRO Australia Limited
and ABN AMRO BANK N.V., Australian Branch
each a Financier
ABN AMRO Facilities Australia Limited
Security Trustee and Facility Agent
(C)Copyright Clayton Utz
<PAGE> 352
TABLE OF CONTENTS
<TABLE>
<CAPTION>
CLAUSE PAGE
<S> <C> <C>
1. DEFINITIONS AND INTERPRETATION 1
1.1 Definitions 1
1.2 Interpretation 12
1.3 Dual Financiers 13
1.4 Debenture Stock Trust Deeds 13
2. THE FACILITY 13
2.1 Commitment 13
2.2 Purpose and Application of Advances 14
2.3 Termination 14
2.4 Joinder of New Borrowers 14
3. DRAWDOWN 15
3.1 Notice 15
3.2 Contents of Drawdown Request 15
3.3 Requirements of Drawdown Request 15
3.4 Financiers to advise of outstanding Conditions Precedent 16
4. CONDITIONS PRECEDENT 16
4.1 Documentary Conditions Precedent 16
4.2 Further Conditions Precedent 18
4.3 Security over further Approved Aged Care Assets 20
4.4 Security - Capital Expenditure 21
4.5 Certification 22
5. REPAYMENT AND PREPAYMENTS 22
5.1 Repayment 22
5.2 Prepayment 22
6. INTEREST 23
6.1 Interest Periods 23
6.2 Calculation of Interest 23
6.3 Payment of Interest 23
7. INTEREST ON OVERDUE AMOUNTS 24
7.1 Payment of interest 24
</TABLE>
<PAGE> 353
TABLE OF CONTENTS
<TABLE>
<CAPTION>
CLAUSE PAGE
<S> <C> <C>
7.2 Accrual of interest 24
8. BILL RELIQUEFICATION 24
8.1 Financiers' election 24
8.2 Nature of Bills 24
8.3 Borrower's Obligations 25
8.4 Financiers' rights and Obligations 25
9. FEES 26
9.1 Establishment Fee 26
9.2 Non-Usage Fee 26
9.3 Fees Non-refundable 26
10. PAYMENTS 26
10.1 Time and place 26
10.2 No deduction for Taxes and no set-off or counterclaim 27
10.3 Merger 27
10.4 Conversion of Foreign Currency receipts to Dollars 27
10.5 Costs of conversion 27
10.6 Foreign Currency indemnity 27
11. ILLEGALITY AND INCREASED COSTS 28
11.1 Illegality 28
11.2 Increased cost 28
12. REPRESENTATIONS AND WARRANTIES 29
12.1 General representations and warranties 29
12.2 Corporate representations and warranties 30
12.3 Trust Representations and Warranties 31
12.4 Representations and warranties repeated 32
12.5 No representation by Financiers 32
13. UNDERTAKINGS 32
13.1 General undertakings 32
13.2 Undertakings relating to the Security Property 35
13.3 Trust undertakings 36
</TABLE>
<PAGE> 354
TABLE OF CONTENTS
<TABLE>
<CAPTION>
CLAUSE PAGE
<S> <C> <C>
14. DEFAULT AND TERMINATION 37
14.1 Events of Default 37
14.2 Rights of Financiers on Event of Default 39
14.3 Review Event 39
14.4 Consequences of Review Event 40
15. ADDITIONAL INDEMNITY 40
16. EXPENSES AND STAMP DUTIES 41
16.1 Expenses 41
16.2 Stamp Duties 41
17. ASSIGNMENTS 41
17.1 Assignments by the Financiers 41
17.2 Assignments by the Borrowers 41
17.3 Successors and assigns 42
18. SYNDICATION 42
18.1 Financiers may syndicate 42
18.2 Substitution 42
18.3 Consent to Issue of Stock 43
18.4 Syndication Provisions 44
18.5 Stamp Duty 44
19. GOVERNING LAW AND JURISDICTION 44
19.1 Governing law 44
19.2 Jurisdiction 44
20. MISCELLANEOUS 45
20.1 Certificate of Financier 45
20.2 Notices 45
20.3 Continuing obligation 46
20.4 Settlement conditional 46
20.5 Further assurance 46
20.6 Attorney 46
20.7 Severability of provisions 47
20.8 Transaction Documents 47
</TABLE>
<PAGE> 355
TABLE OF CONTENTS
<TABLE>
<CAPTION>
CLAUSE PAGE
<S> <C> <C>
20.9 Remedies cumulative 47
20.10 Waiver 47
20.11 Consents and approvals 47
20.12 Written waiver, consent and approval 48
20.13 Time of essence 48
20.14 Professional fees 48
20.15 Moratorium legislation 48
20.16 Mutual accounts 48
20.17 Binding on each signatory 48
20.18 Counterparts 49
21. NO REPRESENTATION BY OR RELIANCE ON THE FINANCIERS 49
SCHEDULE 1 DRAWDOWN REQUEST 50
SCHEDULE 2 SUBSTITUTION CERTIFICATE 52
SCHEDULE 3 SYNDICATION PROVISIONS 56
SCHEDULE 4 MORAN PROPERTIES 63
SCHEDULE 5 ACCESSION AGREEMENT 65
</TABLE>
<PAGE> 356
WAREHOUSE FACILITY AGREEMENT made at on 1998
BETWEEN PRINCIPAL HEALTHCARE FINANCE PTY LIMITED, ACN 069 875 476
both in its personal capacity and in its capacity as trustee of
the PHF Trust ("Initial Borrower")
AND ABN AMRO AUSTRALIA LIMITED, ACN 000 862 797 and ABN AMRO
BANK N.V., AUSTRALIAN BRANCH, ARBN 079 478 612
AND ABN AMRO FACILITIES AUSTRALIA LIMITED, ACN 001 035 543
("Security Trustee" and "Facility Agent")
OPERATIVE PROVISIONS:
1. DEFINITIONS AND INTERPRETATION
1.1 Definitions
In this Agreement:
"ABN AMRO Commitment" means the Total Facility Limit less all Commitments
that have been transferred to New Financiers pursuant to Substitution
Certificates.
"Accession Agreement" means an agreement in, or substantially in, the
form of Schedule 5.
"Advance" means a loan (by way of cash advance) by the Financiers to a
Borrower under this Agreement or, where the context requires, the balance
of the loan which is outstanding.
"Approved Aged Care Assets" means:.
(a) assets that a Borrower proposes to acquire (or which have been
acquired, as the context requires) from Moran Health Care Group
Pty Limited (or any of its Related Bodies Corporate); and
(b) such other healthcare or healthcare related facilities (including
aged care facilities, nursing and/or residential care facilities
for the aged, mentally infirm, the chronically ill, the learning
or physically disabled, hospitals, medical surgeries) or entities
owning such facilities, that a Borrower proposes to acquire (or
which have been acquired, as the context requires) from any other
person,
as may be approved in writing by the Financiers under clause 4.2(b).
"Associate" has the same meaning as in section 11 of the Corporations
Law.
<PAGE> 357
"Banking Day" means a day (other than a Saturday or Sunday) on which
trading banks are open for business generally in Sydney.
"BBSY Rate" in relation to each Interest Period means:
(a) the rate (expressed as a percentage per annum, rounded up to four
decimal places) which is the average of the bid rates shown at
approximately 11.00 am on page "BBSY" on the Reuters Monitor
System on the first day of that Interest Period for a term equal
to the duration of that Interest Period (or if that Interest
Period is subject to marginal adjustment, for a term equal to the
duration of the Interest Period prior to such adjustment); or
(b) if for any reason the rate referred to at paragraph (a) above is
not displayed or is no longer available, or the basis for
calculation of that rate is changed after the date of this
Agreement and in the reasonable opinion of the Financiers ceases
to reflect the Financiers' cost of funding to the same extent as
at the date of this Agreement, then:
(i) if a Syndication has not occurred - the rate (expressed as
a percentage per annum) at which the Financiers would be
prepared to fund the relevant Advance(s);
(ii) if a Syndication has occurred - the average of the rates at
which the Financiers would be prepared to fund the relevant
Advance(s) (determined by aggregating those rates and
dividing the total by the number of Financiers at the
relevant time).
"Bill" means a bill of exchange within the meaning given to the
expression "bill of exchange" in the Bills of Exchange Act 1909
(Commonwealth), but does not include a cheque or payment order, and any
reference to the drawing, acceptance, indorsement or other dealing of or
with a Bill refers to a drawing, acceptance, indorsement or other dealing
within the meaning of that Act.
"Borrower" means, at any time, the Initial Borrower and each New Borrower
(if any) at that time.
"Borrowing" means any liability in respect of money borrowed or raised
(including rentals under finance leases) or any other form of financial
accommodation, including any liability under any bill of exchange,
debenture, note or security, or under any acceptance credit facility
(including the FAI Facility), any liability in respect of the acquisition
cost of assets or services to the extent payable after the time of
acquisition or possession thereof, and any guarantee or other assurance
against financial loss in respect of any such financial accommodations.
"Business" means the business conducted by the Borrowers (or a New
Security Provider, as the context requires) in connection with the
Approved Aged Care Assets, including the acquisition or leasing of the
Approved Aged Care Assets.
<PAGE> 358
"Capex Contribution" means a payment under clause 2 of the Capital
Contribution Agreement.
"Capital Contribution Agreement" means the agreement dated on or about
the date of this Agreement between the Initial Borrower, Moran Health
Care (Australia) Pty Limited and Moran Health Care Group Pty Limited.
"Commitment" means, in respect of a Financier:
(a) under the FAI Facility - a dollar amount equal to the portion of
the aggregate face value of all FAI Bills; and
(b) under the Warehouse Facility - a dollar amount equal to a portion
of the Facility Limit,
for which that Financier is liable, and:
(c) in the case of ABN AMRO Australia Limited - its Commitment under
the FAI Facility is $50,000,000 as reduced by any transfer of
rights and obligations under a Substitution Certificate; and
(d) in the case of ABN AMRO Australia Limited and ABN AMRO BANK N.V.
as dual financiers under this Agreement - their Commitment under
the Warehouse Facility is $75,000,000 as reduced by any transfer
of rights and obligations under a Substitution Certificate; and
(e) in the case of a New Financier - its Commitments under the FAI
Facility and the Warehouse Facility will be the amount of the
"Substituted Commitments" stated in the Substitution Certificate
to which the New Financier is a party.
"Conditions Precedent" means the conditions precedent referred to in
clauses 4.1 and 4.2.
"Control" means:
(a) in respect of a Borrower which is a corporation - the possession
directly or indirectly of the power, whether or not having
statutory, legal or equitable force, and whether or not based on
statutory, legal or equitable rights or otherwise, by OWI or any
Associate of OWI, directly or indirectly to control the membership
of the board of directors of the corporation or to otherwise
directly or indirectly direct or cause the direction of the
management, policies or activities of the corporation whether by
means of trusts, agreements, arrangements, understandings,
practices, the ownership of any interest in shares or stock of the
corporation or otherwise; and
(b) in respect of the PHF Trust or any other Borrower which is a
trust, partnership, or other entity other than a corporation - the
possession directly or indirectly of the power, whether or not
having statutory, legal or equitable force, and whether
<PAGE> 359
or not based on statutory, legal or equitable rights or otherwise,
by OWI or any Associate of OWI, directly or indirectly to control
the Borrower or to otherwise directly or indirectly direct or
cause the direction of the management, policies or activities of
the Borrower whether by means of trusts, agreements, arrangements,
understandings, practices, the ownership of any interest in the
Borrower or otherwise.
"Controller" has the meaning given in section 9 of the Corporations Law.
"Cross-Guarantee" means, in respect of a proposed New Borrower, a
guarantee and indemnity in such form and on such terms as the Facility
Agent may require whereby each Borrower (including the proposed New
Borrower) guarantees to each Financier the obligations of each other
Borrower under the other Transaction Documents.
"Debenture Stock Trust Deed (Ongoing Assets)" means the Debenture Stock
Trust Deed dated on or about the date of this Agreement between the
Initial Borrower and the Security Trustee.
"Dollar" or "$" means the lawful currency for the time being of the
Commonwealth of Australia.
"Drawdown Date" means the date on which an Advance is made or, where the
context requires, is proposed to be made.
"Drawdown Request" means a written request that complies with clauses 3.2
and 3.3.
"Encumbrance" means any mortgage, charge, pledge, lien, encumbrance,
assignment hypothecation, security interest, title retention,
preferential right, trust arrangement, contractual right of set-off or
any other security agreement or arrangement in favour of any person.
"Essential Lease Terms" means (except to the extent to which the
Financiers and the Initial Borrower otherwise agree in writing):
(a) where the Operator of the relevant Approved Aged Care Assets is
Moran Health Care (Australia) Pty Limited or any of its Related
Bodies Corporate - provisions in the documentation between the
Initial Borrower and the Operator of those Approved Aged Care
Assets to the effect that:
(i) a minimum rent cover ratio requirement of 1.5 x gross
rental must be observed by the Operator;
(ii) the net worth of the group of companies of which the
Operator forms part is at all times at least $65,000,000
(on a consolidated basis); and
(iii) a six month rent reserve must be provided by the Operator
and held by the Initial Borrower (and may take the form of
a bank guarantee, letter of credit or straight cash cover);
and
<PAGE> 360
(b) where the Operator of the relevant Approved Aged Care Assets is a
person who is not referred to in paragraph (a) - such provisions,
if any, of the documentation between the relevant Borrower and the
Operator of the Approved Aged Care Assets as are proposed by the
Borrower as "Essential Lease Terms" pursuant to clause 4.2(a)(i)
and are approved by the Financiers as such.
"Event of Default" means any of the events referred to in clause 14.1 or
14.4.
"Face Amount" has the same meaning as in the Original Debenture Stock
Trust Deed or the Debenture Stock Trust Deed (Ongoing Assets), as the
context requires.
"Facility Limit" means $75,000,000 or any other amount as may be agreed
in writing between the Financiers and the Initial Borrower to the extent
that the Warehouse Facility is not terminated or cancelled under this
Agreement.
"FAI Bill" means a Bill accepted by ABN AMRO Australia Limited pursuant
to the FAI Facility Agreement.
"FAI Facility" means the bill acceptance facility provided by ABN AMRO
Australia Limited to the Initial Borrower pursuant to the FAI Facility
Agreement.
"FAI Facility Agreement" means the Bill Facility Agreement dated 19 June
1998 between ABN AMRO Australia Limited and the Initial Borrower.
"FAI Facility Limit" means the "Facility Limit" as defined in the FAI
Facility Agreement.
"FAI Transaction Documents" means the "Transaction Documents" as defined
in the FAI Facility Agreement.
"Featherweight Fixed and Floating Charge" means a fixed and floating
charge that:
(a) in so far as it applies to the assets and undertaking of a New
Security Provider that are used in the conduct of the Business (or
the proceeds of disposal of such assets) - is on the same terms as
the Fixed and Floating Charge (NSW and Vic); and
(b) in so far as it applies to other assets - can only be enforced if
an administrator is appointed to the New Security Provider or any
proposal is made by any person to appoint an administrator to the
New Security Provider.
"Fees Side Letter" means the side letter agreement entitled "Fees Side
Letter" dated on or about the date of this Agreement between the Initial
Borrower, the Financiers and the Security Trustee.
"Financial Quarter" means each period of 3 calendar months commencing on
each 1 July, 1 October, 1 January and 1 April until the Termination Date,
provided that:
<PAGE> 361
(a) the first Financial Quarter shall commence on the date of this
Agreement and end at midnight on 31 December, 1998; and
(b) the last Financial Quarter shall terminate at midnight on the
Termination Date.
"Financier" means either ABN AMRO Australia Limited or ABN AMRO BANK
N.V., and after any Syndication occurs, includes each New Financier.
"Fixed and Floating Charge (NSW and Vic)" means the deed entitled "Deed
of Charge (NSW and Vic)" between the Initial Borrower and the Security
Trustee dated on or about the date of this Agreement.
"Fixed and Floating Charge (Qld)" means the deed entitled "Deed of Charge
(Qld)" between the Initial Borrower and the Security Trustee dated on or
about the date of this Agreement.
"Fixed and Floating Charge (WA)" means the deed entitled "Deed of Charge
(WA)" between the Initial Borrower and the Security Trustee dated on or
about the date of this Agreement.
"Foreign Currency" means the currency for the time being of any country
other than the Commonwealth of Australia.
"Higher Rate" means the aggregate of the Lower Rate and 2% per annum.
"Initial Unitholders" means Metlife Australia (Holdings) Pty Limited,
ACN 070 667 417 and FAI Deposit Co. Pty Limited, ACN 008 647 489.
"Insolvency Event" means:
(a) a receiver, manager, receiver and manager, trustee, administrator,
Controller or similar officer is appointed in respect of a person
or any asset of a person (and does not retire, or is not removed,
within 3 Banking Days of such appointment);
(b) a liquidator or provisional liquidator is appointed in respect of
a corporation;
(c) any application (not being an application withdrawn, stayed or
dismissed within 10 days) is made to a court for an order, or an
order is made, or a meeting is convened, or a resolution is
passed, for the purpose of:
(i) appointing a person referred to in paragraphs (a) or (b);
(ii) winding up a corporation; or
(iii) proposing or implementing a scheme of arrangement;
(d) a moratorium of any debts of a person, or an official assignment,
or a composition, or an arrangement (formal or informal) with a
person's creditors, or any similar proceeding or arrangement by
which the assets of a person are
<PAGE> 362
subjected conditionally or unconditionally to the control of that
person's creditors or a trustee, is ordered, declared, or agreed
to, or is applied for and the application is not withdrawn, stayed
or dismissed within 10 days;
(e) a person becomes, or admits in writing that it is, is declared to
be, or is deemed under any applicable law to be, insolvent or
unable to pay its debts; or
(f) any writ of execution, garnishee order, mareva injunction or
similar order, attachment, distress or other process is made,
levied or issued against or in relation to any asset of a person
for any amount exceeding $100,000.
"Insolvency Provision" means any law relating to insolvency,
sequestration, liquidation or bankruptcy (including any law relating to
the avoidance of conveyances in fraud of creditors or of preferences and
any law under which a liquidator or trustee in bankruptcy may set aside
or avoid transactions) and any provision of any agreement, arrangement or
scheme, formal or informal, relating to the administration of any of the
assets of any person.
"Interest Period" means (subject to clause 6.1(b), (c), (d) and (e)) a
period of 30, 60 or 90 days duration selected by the Initial Borrower in
accordance with clause 6.1(a).
"Lease" means any lease or licence of any Moran Property granted by the
Initial Borrower in favour of Moran Health Care (Australia) Pty Limited.
"Lease Guarantee" means the deed entitled "Lease Guarantee" dated on or
about the date of this Agreement between Moran Health Care Group Pty
Limited and the Initial Borrower.
"Lessee Purchase" means a lessee of an Approved Aged Care Asset
purchasing that Approved Aged Care Asset in accordance with the terms of
the lease of that Approved Aged Care Asset.
"Lower Rate" for each Interest Period means the aggregate of the
applicable BBSY Rate and the Margin.
"Margin" means in respect of an Advance:
(a) for the period from the Drawdown Date of the Advance until the
date which is 6 months after such Drawdown Date - 1.15% per annum;
and
(b) thereafter - 1.5% per annum.
"Moran Documents" means:
(a) the Lease;
(b) the Lease Guarantee;
<PAGE> 363
(c) the New Relationship Agreement;
(d) the Fixed and Floating Charge dated 19 June 1998 between the
Initial Borrower and Moran Health Care (Australia) Pty Limited as
trustee of the Moran Health Care Australia Trust;
(e) the Mortgage of Units dated 19 June 1998 between the Initial
Borrower and Moran Health Care Group Pty Limited; and
(f) the Mortgage of Shares dated 19 June 1998 between the Initial
Borrower and Moran Health Care Group Pty Limited.
"Moran Properties" means each property listed in Schedule 4.
"Mortgages" means mortgages over Approved Aged Care Assets granted by a
Borrower under clause 4.3.
"New Borrower" means a wholly-owned Subsidiary of the Initial Borrower
(or a Permitted Sister Subsidiary, as the case may be) in respect of whom
the requirements of paragraphs (a) to (e) (inclusive) of clause 2.4 have
been satisfied.
"New Financier" means a bank or financial institution to whom the
Financiers transfer part of their rights and obligations under the
Transaction Documents and the FAI Transaction Documents in accordance
with clause 18.2(a).
"New Relationship Agreement" means the agreement entitled "Relationship
Agreement" between the Initial Borrower, Moran Health Care (Australia)
Pty Limited and Moran Health Care Group Pty Limited and dated on or about
the date of this Agreement.
"Non-Usage Fee" means the fee payable by the Borrowers under clause
9.2(a).
"Obligations" means all the liabilities of the Borrowers to the
Financiers under or by reason of:
(a) any Transaction Document to which a Borrower is a party; or
(b) any other transaction, matter or event,
and includes any liabilities which:
(c) are unliquidated;
(d) are present, prospective or contingent;
(e) are in existence before or come into existence after the date of
this Agreement;
(f) relate to the payment of money or the performance or omission of
any act;
(g) sound in damages only; or
(h) accrue as a result of any Event of Default.
<PAGE> 364
"Ongoing Security Trust" means the security trust constituted by the
Debenture Stock Trust Deed (Ongoing Assets).
"Operator" means, in respect of Approved Aged Care Assets, a person
approved by the Financiers (such approval not to be unreasonably
withheld) to operate and manage some or all of the Approved Aged Care
Assets.
"Operator Document" means any document referred to in clause 4.2(d).
"Original Debenture Stock Trust Deed" means the Debenture Stock Trust
Deed dated 17 June 1998 between the Initial Borrower and the Security
Trustee.
"Original Securities" means:
(a) the Original Debenture Stock Trust Deed;
(b) the Debenture Stock Trust Deed (Ongoing Assets);
(c) the Fixed and Floating Charge (NSW and Vic);
(d) the Fixed and Floating Charge (Qld);
(e) the Fixed and Floating Charge (WA);
(f) the Real Property Mortgage (NSW);
(g) the Real Property Mortgage (Qld); and
(h) the Real Property Mortgage (WA).
"OWI" means Omega Worldwide Inc.
"OWI Guarantee" means the Deed of Guarantee and Indemnity dated on or
about the date of this Agreement between OWI, ABN AMRO Australia Limited
and ABN AMRO BANK N.V.
"Permitted Sister Subsidiary" means a company which is:
(a) a wholly owned Subsidiary of OWI; or
(b) Controlled by OWI and which is acceptable to the Financiers in
their absolute discretion.
"Permitted Trust" means a trust of which a New Borrower is the sole
trustee and in respect of which an agreement required by clause 2.4 (e)
has been entered into.
<PAGE> 365
"PHF Trust" means the trust known as the "Principal Healthcare Finance
Trust" (formerly known as the "Assisted Living Unit Trust") constituted
by the Trust Deed.
"Potential Event of Default" means any event which, with the giving of
notice, lapse of time, or any determination, might (in the reasonable
opinion of the Financiers) constitute an Event of Default.
"Real Property Mortgage (NSW)" means the mortgage over Approved Aged Care
Assets that constitute land situated in New South Wales, granted by the
Initial Borrower in favour of the Security Trustee on or about the date
of this Agreement.
"Real Property Mortgage (Qld)" means the mortgage over Approved Aged Care
Assets that constitute land situated in Queensland, granted by the
Initial Borrower in favour of the Security Trustee on or about the date
of this Agreement.
"Real Property Mortgage (WA)" means the mortgage over Approved Aged Care
Assets that constitute land situated in Western Australia granted by the
Initial Borrower in favour of the Security Trustee on or about the date
of this Agreement.
"Register" has the same meaning as in the Original Debenture Stock Trust
Deed or the Debenture Stock Trust Deed (Ongoing Assets), as the context
requires.
"Related Body Corporate" has the meaning given in section 9 of the
Corporations Law, but on the basis that "Subsidiary" for the purposes of
that definition has the meaning given in this Agreement.
"Relationship Agreement" means the agreement so entitled dated 19 June
1998 between OWI, PHF No. 1 Pty Limited, PHF No. 2 Pty Limited, Tanoa Pty
Limited, Mindra Pty Limited, Beheer - en Beleggingsmaatschappij Dilava
BV, Beheer - en Beleggingsmaatschappij Rocla BV, Moran Health Care
(Australia) Pty Limited and Moran Health Care Group Pty Limited.
"Review Event" means any event referred to in clause 14.3.
"Securities" means the Original Securities plus any other security held
by the Financiers at any time for the due performance, observance and
fulfilment of the Obligations (including any Mortgages), and "Security"
means each or any one of them as the context requires.
"Security Property" means any property subject to a Security.
"Security Trustee" means ABN AMRO Facilities Australia Limited.
"Stock" and "Stock Certificate" each have the same meaning as in the
Original Debenture Stock Trust Deed or the Debenture Stock Trust Deed
(Ongoing Assets), as the context requires.
<PAGE> 366
"Subsidiary" in relation to any person, has the meaning given in the
Corporations Law but so that:
(a) an entity will also be deemed to be a Subsidiary of a
company if it is controlled by that company (expressions
used in this paragraph have the meanings given for the
purposes of parts 3.6 and 3.7 of the Corporations Law);
(b) a trust may be a Subsidiary, for the purposes of which any
units or other beneficial interests will be deemed to be
shares; and
(c) a corporation or trust may be a Subsidiary of a trust if it
would have been a Subsidiary if that trust were a
corporation.
"Substitution Certificate" means a certificate in or substantially in the
form of Schedule 2.
"Syndication" means a transfer of rights and obligations under the
Transaction Documents and the FAI Transaction Documents in accordance
with clause 18.
"Taxes" mean all present and future income, stamp and other taxes
(including goods and services taxes, consumption taxes, and value added
or other similar taxes), levies, imposts, deductions, charges and
withholdings plus interest thereon and penalties, if any, and charges,
fees or other amounts in respect of any of them, except if imposed on the
overall net income of a Financier.
"Termination Date" means the first to occur of:
(a) the first anniversary of the date of this Agreement (or
such later date as the Initial Borrower and the Financiers
may agree); and
(b) such earlier date on which the Warehouse Facility is
terminated or cancelled by the Financiers in accordance
with this Agreement.
"Total Facility Limit" means the aggregate of the Facility Limit and the
FAI Facility Limit.
"Transaction Documents" means:
(a) this Agreement;
(b) the Tripartite Agreement;
(c) each Security;
(d) the OWI Guarantee;
<PAGE> 367
(e) the Fees Side Letter;
(f) each Accession Agreement;
(g) each Cross-Guarantee;
(h) each Substitution Certificate; and
(i) each other document to which a Borrower and a Financier are
parties at any time that:
(i) relates to any money that is declared by that
document to be part of the Obligations; or
(ii) is expressed to be, or is agreed by the said parties
to be, a Transaction Document for the purposes of
this Agreement,
and any document which is, or which is expressed to be, collateral or
supplemental to any other document that is then a Transaction Document.
"Tripartite Agreement" means the agreement so entitled dated on or about
the date of this Agreement between ABN AMRO Australia Limited, ABN AMRO
BANK N.V., the Initial Borrower the Security Trustee, Tanoa Pty Limited
and PHF No. 1 Pty Limited.
"Trust Deed" means the deed of trust dated 11 August 1995 between the
Initial Borrower and the Initial Unitholders.
"Undrawn Commitment" means, on any day, the Facility Limit minus the
amount of all outstanding Advances as at 9.00am (Sydney time) on that
day.
"Valuation" means, in respect of any asset, a valuation of the business
conducted in connection with that asset on a going concern basis and
otherwise on terms acceptable to the Financiers by a suitably qualified
and experienced valuer approved by the Financiers, and which is addressed
to the Financiers. If the relevant asset is not fully operational at the
time of the Valuation, the Valuation must contain both a valuation of the
asset (in accordance with the previous sentence) and an estimate of the
cost involved in making the asset fully operational.
"Warehouse Facility" means the cash advance facility provided to the
Borrowers by the Financiers in accordance with this Agreement.
1.2 Interpretation
In this Agreement:
(a) headings are for convenience only and do not affect
interpretation; and
unless the context indicates a contrary intention:
<PAGE> 368
(b) the expression "person" includes an individual, the estate
of an individual, a body politic, a corporation and a
statutory or other authority or association (incorporated
or unincorporated);
(c) a reference to any party includes that party's executors,
administrators, successors, substitutes and assigns,
including any person taking by way of novation and in the
case of a trustee includes any substituted or additional
trustee;
(d) a reference to any Transaction Document however described
or to any other document includes the Transaction Document
or other document as amended, varied, novated,
supplemented, ratified or replaced from time to time;
(e) a reference to any legislation or to any section or
provision thereof includes any statutory modification,
re-write or re-enactment or any statutory provision
substituted therefor and all ordinances, by-laws,
regulations and other statutory documents issued
thereunder;
(f) words importing the singular include the plural (and vice
versa) and words denoting a given gender include all other
genders;
(g) a reference to a clause is a reference to a clause of this
Agreement;
(h) where any word or phrase is given a defined meaning, any
other part of speech or grammatical form in respect of such
word or phrase has a corresponding meaning;
(i) where the day on or by which any sum is payable or any act,
matter or thing is to be done is a day other than a Banking
Day, that sum will be paid and that act, matter or thing
will be done on the immediately preceding Banking Day;
(j) all accounting terms used have the meaning given under
accounting principles and practices generally accepted in
Australia from time to time;
(k) any agreement, undertaking, acknowledgement, condition or
other term that is made or given by a Borrower will be
deemed to be a covenant by the Borrower in favour and for
the benefit of the Financiers;
(l) any reference to the drawing, acceptance, indorsement or
other dealing of or with a Bill refers to a drawing,
acceptance, indorsement or other dealing within the meaning
of the Bills of Exchange Act 1909 (Commonwealth); and
(m) mentioning anything after "include", "includes" or
"including" does not limit what else may be included.
<PAGE> 369
1.3 Dual Financiers
(a) Each Borrower acknowledges and agrees that the Warehouse Facility
provided by ABN AMRO Australia Limited and ABN AMRO BANK N.V. is
one and the same facility, made by them jointly and severally.
Where ABN AMRO Australia Limited and ABN AMRO BANK N.V. are
obliged to provide an Advance which one of them actually provides
that Advance shall be determined by ABN AMRO Australia Limited in
its absolute discretion.
(b) Reference in any Transaction Document to a "Financier" in relation
to an Advance shall, so far as that reference relates to ABN AMRO
Australia Limited and ABN AMRO BANK N.V., be deemed to be a
reference to whichever of ABN AMRO Australia Limited or ABN AMRO
BANK N.V. has actually provided that Advance. All other references
in any Transaction Document to a "Financier" will, so far as that
reference relates to ABN AMRO Australia Limited and ABN AMRO BANK
N.V., be deemed to be a reference to either or both of ABN AMRO
Australia Limited and ABN AMRO BANK N.V. as the context requires.
(c) A consent from, a communication by, or the exercise of a
discretion by, one of ABN AMRO Australia Limited or ABN AMRO BANK
N.V. in its capacity as a Financier shall bind the other of them
as a Financier.
(d) A payment to ABN AMRO BANK N.V., as a Financier, in respect of an
obligation to pay ABN AMRO Australia Limited shall satisfy, to the
extent of that payment, the obligation to pay ABN AMRO Australia
Limited, and a payment to ABN AMRO Australia Limited, as a
Financier, in respect of an obligation to pay ABN AMRO BANK N.V.
shall satisfy, to the extent of that payment, the obligation to
pay ABN AMRO BANK N.V.
1.4 Debenture Stock Trust Deeds
Each Borrower and each Financier acknowledges that this Agreement is a
"Transaction Document" as defined in and for the purposes of the Original
Debenture Stock Trust Deed and the Debenture Stock Trust Deed (Ongoing
Assets).
2. THE FACILITY
2.1 Commitment
The Financiers agree to make Advances to the Borrowers under the
Warehouse Facility up to an aggregate principal amount equal to the
Facility Limit, subject to the terms of this Agreement and in reliance on
the representations and warranties contained in it.
<PAGE> 370
2.2 Purpose and Application of Advances
(a) A Borrower may only use the Warehouse Facility in
connection with:
(i) the acquisition of Approved Aged Care Assets; or
(ii) capital expenditure in respect of Approved Aged Care
Assets which have been acquired by the Borrower.
(b) If the Financiers make an Advance under this Agreement, the
relevant Borrower may only use that Advance towards paying
the purchase price of the Approved Aged Care Assets in
respect of which the Advance is made (or towards payments
to be made pursuant to the terms of the Capital
Contribution Agreement in respect of those Approved Aged
Care Assets, as the case may be), and the Amount of the
relevant Advance (together with any other Advances in
respect of the relevant Approved Aged Care Assets) must not
exceed 67% of the Valuation of those Approved Aged Care
Assets.
2.3 Termination
The Warehouse Facility terminates on the Termination Date.
2.4 Joinder of New Borrowers
If the Initial Borrower wishes to add a wholly-owned Subsidiary of the
Initial Borrower, or a Permitted Sister Subsidiary as a Borrower under
this Agreement, the Initial Borrower shall:
(a) execute, and procure that the proposed New Borrower
executes, an Accession Agreement;
(b) deliver to the Facility Agent such constituent documents of
the proposed New Borrower, certificates of registration of
the proposed New Borrower, extracts of resolutions of the
board of directors of the proposed New Borrower, powers of
attorney, authorisations, opinions and other documents as
the Facility Agent may reasonably require;
(c) execute, and procure that the proposed New Borrower
executes, a Cross-Guarantee in such form and on such terms
as the Facility Agent may require;
(d) procure that the proposed New Borrower executes a fixed and
floating charge over all of its assets and undertaking on
the same terms as the fixed and floating charge contained
in the Debenture Stock Trust Deed (Ongoing Assets); and
<PAGE> 371
(e) if the proposed New Borrower is the trustee of a trust -
procure that the proposed New Borrower and each beneficiary
of that trust executes an agreement in respect of that
trust on the same terms as the Tripartite Agreement.
Each Borrower (other than the Initial Borrower and the proposed New
Borrower) hereby irrevocably appoints the Initial Borrower to execute
Accession Agreements on its behalf and as its attorney.
Each Financier and the Security Trustee hereby irrevocably appoints the
Facility Agent to execute Accession Agreements on its behalf and as its
attorney.
3. DRAWDOWN
3.1 Notice
A Borrower may request the Financiers to make an Advance under the
Warehouse Facility by giving a Drawdown Request to the Financiers.
3.2 Contents of Drawdown Request
Each Drawdown Request must be in or substantially in the form set out in
Schedule 1 and must specify:
(a) the amount of the Advance (which must be at least
$2,000,000 or such lower amount as the Financiers may
approve);
(b) the proposed Drawdown Date (which must be a Banking Day
prior to the Termination Date);
(c) the proposed initial Interest Period of the Advance;
(d) payment instructions; and
(e) any other details the Financiers reasonably require.
3.3 Requirements of Drawdown Request
Each Drawdown Request:
(a) must be received by the Financiers 3 clear Banking Days
before the proposed Drawdown Date or at such other time as
the Borrower giving the Drawdown Request and Financier
agree;
(b) must be signed by a person duly authorised by the relevant
Borrower to do so;
<PAGE> 372
(c) will be irrevocable;
(d) must not be given until all the Conditions Precedent to the
Advance requested have been satisfied (except for the
Conditions Precedent referred to in clause 4.1(a) and (b)
to the extent to which they require matters to be stated in
a Drawdown Request); and
(e) must not be given if the making of the Advance requested
would cause the Facility Limit to be exceeded or otherwise
would not comply with any term of this Agreement.
3.4 Financiers to advise of outstanding Conditions Precedent
If a Borrower proposes to give a Drawdown Request to the Financiers then,
within a reasonable time after being requested to do so, the Financiers
will notify that Borrower of the outstanding Conditions Precedent, if
any, that need to be satisfied before the Drawdown Request may be given.
4. CONDITIONS PRECEDENT
4.1 Documentary Conditions Precedent
The obligation of the Financiers to make an Advance is subject to the
condition that they have first received all of the following in form and
substance satisfactory to them:
(a) (Constitution): a certified copy of the constitution of
each Borrower (or a certified copy of all amendments or
variations to the constitution of a Borrower that have been
made since a certified copy of that Borrower's constitution
was last provided to a Financier, or if no such amendments
or variations have been made, a statement to that effect in
the relevant Drawdown Request);
(b) (Trust Deed): a certified copy of the Trust Deed and all
constituent documents of each Permitted Trust (or a
certified copy of all amendments or variations to the Trust
Deed or relevant document which have been made since a
certified copy of the Trust Deed or relevant document was
last provided to a Financier or, if no such amendments or
variations have been made, a statement to that effect in
the relevant Drawdown Request);
(c) (Corporate authorisation): a certified copy of a resolution
of the directors of the Initial Borrower approving the
Warehouse Facility and authorising:
(i) in the case of the first Advance:
<PAGE> 373
A. the execution by the Initial Borrower of this
Agreement, the Original Securities and the
Tripartite Agreement; and
B. a person or persons to sign Bills, notices,
certificates or other documents in connection
with the Warehouse Facility on behalf of the
Initial Borrower; and
(ii) in the case of a later Advance, such matters as the
Financiers may reasonably require;
(d) (Powers of Attorney): an original execution copy of any
power of attorney pursuant to which any Transaction
Document is to be executed by any Borrower or OWI or any of
their Related Bodies Corporate;
(e) (Signatories): a certified copy of the signatures of all
persons authorised to sign on behalf of the Borrowers;
(f) (Executed Documents): this Agreement, each Original
Security, the Tripartite Agreement, the Fees Side Letter,
the OWI Guarantee and each Moran Document duly executed and
stamped (which the Financiers will provide to the Security
Trustee after the making of the first Advance has
occurred);
(g) (Certificates of Title): certificates of title for each
Moran Property subject to the Real Property Mortgage (NSW),
or the Real Property Mortgage (WA), and such other
documentation, including discharges of Encumbrances, as may
be necessary to procure the registration of the Real
Property Mortgage (NSW), the Real Property Mortgage (Qld)
and the Real Property Mortgage (WA) as first ranking
mortgages at the relevant land titles offices (which the
Financiers will provide to the Security Trustee after the
making of the first Advance has occurred);
(h) (Settlement Notice for Queensland Properties): a settlement
notice in respect of each Moran Property subject to the
Real Property Mortgage (Qld) duly executed by the Initial
Borrower;
(i) (Forms 309 and 350): duly completed Corporations Law Forms
309 and 350 in respect of the Fixed and Floating Charge
(NSW and Vic), the Fixed and Floating Charge (Qld) and the
Fixed and Floating Charge (WA);
(j) (Payment of Fees): payment in full of the fees required by
the Fees Side Letter to be paid upon or prior to the making
of the first Advance;
<PAGE> 374
(k) (Requisitions): replies to all requisitions of the
Financiers and their solicitors relating to the Warehouse
Facility;
(l) (Legal Opinion): an opinion addressed to the Financiers
from their solicitors, Clayton Utz, as to such matters
relating to this Agreement, the Original Securities and the
Tripartite Agreement as the Financiers may require;
(m) (US Legal Opinion): an opinion addressed to the Financiers
from a legal practitioner practising in the United States
of America approved by the Financiers as to such matters
relating to the OWI Guarantee as the Financiers may
require;
(n) (Ernst and Young Reports): in the case of an Advance in
respect of the Moran Properties, a copy of the report
prepared by Ernst and Young in respect of the financial
projections of the proposed operator of those Approved Aged
Care Assets;
(o) (Issue of Stock to ABN AMRO BANK N.V., Australian Branch
under Original Debenture Stock Trust Deed): a Stock
Certificate under the Original Debenture Stock Trust Deed
issued in favour of ABN AMRO BANK N.V., Australian Branch
and evidence that ABN AMRO BANK N.V., Australian Branch has
been entered in the Register as the holder of Stock under
the Original Debenture Stock Trust Deed;
(p) (Statutory Declaration): a statutory declaration from a
director or secretary of the Initial Borrower stating the
location and approximate values of the assets subject to
the Original Securities on a State-by-State basis;
(q) (Stamp duty forms): a Loan Security Undertaking in such
form as may be required by the Office of State Revenue (New
South Wales), in respect of the Debenture Stock Trust Deed
(Ongoing Assets) duly executed by the Initial Borrower; and
(r) (Issue of Stock under Debenture Stock Trust Deed (Ongoing
Assets): a Stock Certificate under the Debenture Stock
Trust Deed (Ongoing Assets) issued in favour of each
Financier and evidence that each Financier has been entered
on the Register as the holder of Stock under the Debenture
Stock Trust Deed (Ongoing Assets).
4.2 Further Conditions Precedent
The obligation of the Financiers to make an Advance is subject to the
further conditions precedent (which must be in form and substance
satisfactory to the Financiers) that:
<PAGE> 375
(a) (Information regarding proposed acquisition): the Borrower
requesting the Advance has provided to the Financiers:
(i) a detailed proposal in respect of the acquisition of
Approved Aged Care Assets or capital expenditure
that it intends to apply the proceeds of the Advance
towards (including, in the case of an acquisition of
Approved Aged Care Assets, full details of the
assets being acquired, the financial performance of
those assets, any proposed Essential Lease Terms,
the proposed Operator of the assets and details of
its financial position, a Valuation of the assets,
and a confirmation that the relevant Approved Aged
Care Assets are substantially completed and
operational); and
(ii) a copy of the credit memorandum regarding the
proposed transaction and such other information and
materials as the Financiers reasonably require in
respect of the transaction;
(b) (Financier Approval): the Financiers approve in writing:
(i) in the case of a proposed acquisition of Approved
Aged Care Assets:
A. the assets that the relevant Borrower
proposes to purchase with the proceeds of the
Advance; and
B. the operator of those assets; or
(ii) in the case of proposed capital expenditure, that
capital expenditure.
The Financiers agree that the information referred to in
paragraphs (a)(i) and (d) of this clause 4.2 is the key (although
not the only) material that the Financiers will consider in
forming a view as to whether they will approve the transaction for
the purpose of the Warehouse Facility;
(c) (Amount of Advance): the amount of the proposed Advance
(together with any other Advances in respect of the
relevant Approved Aged Care Assets or capital expenditure
in respect of those Approved Aged Care Assets) does not
exceed 67% of a Valuation of the Approved Aged Care Assets;
(d) (Documentation between Borrower and Operator of assets):
in the case of an acquisition of Approved Aged Care Assets,
the Financiers are provided with a copy of all material
documents evidencing the arrangements between the relevant
Borrower and the Operator of the Approved Aged Care Assets,
and the terms of all such documents are reasonably
acceptable to the Financiers. Such documentation must
<PAGE> 376
include all of the Essential Lease Terms. In the case of an
Operator other than Moran Health Care (Australia) Pty
Limited or any of its Related Bodies Corporate, the
documentation will be reasonably acceptable to the
Financiers if it is substantially in the same form as the
Moran Documents;
(e) (Security over Approved Aged Care Assets): the Borrowers
have complied in full with clauses 4.3 and 4.4;
(f) (Certificates of Title): the Financiers have received all
certificates and other indicia of title to any property
over which security will be provided under clause 4.3 or
clause 4.4 (which the Financiers will provide to the
Security Trustee after the making of the Advance has
occurred);
(g) (Requisitions): the Borrowers have satisfactorily replied
to all reasonable requisitions of the Financiers and their
solicitors relating to any property over which security
will be provided under clause 4.3 or clause 4.4;
(h) (Legal Opinion): the Financiers have received an opinion
addressed to the Financiers from their solicitors as to
such matters as the Financiers may require;
(i) (FIRB Approval): in the case of a proposed acquisition of
Approved Aged Care Assets, the Financiers have received
evidence that any authorisation required under the Foreign
Acquisitions and Takeovers Act 1975 (Cth) in respect of the
acquisition by the relevant Borrower of the relevant
Approved Aged Care Assets has been granted (including an
authorisation arising as a result of the expiry of a period
of time after notification to the Foreign Investment Review
Board);
(j) (Representations and warranties true): the representations
and warranties set out in this Agreement are true and
correct as of the date of the Drawdown Request and the
Drawdown Date as though made at that date; and
(k) (No Event of Default): no Event of Default or Potential
Event of Default is subsisting at the date of the relevant
Drawdown Request and the Drawdown Date or may result from
the provision or continuation of the Advance.
4.3 Security over further Approved Aged Care Assets
(a) (Real property acquired by a Borrower): to the extent to
which any Approved Aged Care Assets constitute real
property or an interest in real property and those Approved
Aged Care Assets are not subject
<PAGE> 377
to the Real Property Mortgage (NSW), the Real Property
Mortgage (WA) or the Real Property Mortgage (Qld), the
Borrower who proposes to acquire such Approved Aged Care
Assets shall grant to the Security Trustee (in its capacity
as trustee of the Ongoing Security Trust),
contemporaneously with the Borrower's acquisition of those
Approved Aged Care Assets, a first ranking legal mortgage
over such Approved Aged Care Assets on the same terms as
the Real Property Mortgage (NSW), the Real Property
Mortgage (WA) and the Real Property Mortgage (Qld) (except
for such changes to those terms as are necessary to
accommodate the real property laws in the jurisdiction in
which the property is located, or the nature of the
interest being mortgaged);
(b) (Execution of mortgage): if paragraph (a) applies to any
Approved Aged Care Assets the subject of any proposed
Advance, the relevant Borrower shall, contemporaneously
with the Advance being made available to it under this
Agreement, execute and deliver to the Financiers:
(i) a legal mortgage of such Approved Aged Care Assets
as required by paragraph (a) (which the Financiers
will provide to the Security Trustee (in its
capacity as trustee of the Ongoing Security Trust)
after the making of the Advance has occurred); and
(ii) such other documentation (including discharges of
Encumbrances) as may be required to ensure that the
Security Trustee (in its capacity as trustee of the
Ongoing Security Trust) obtains a registered
first-ranking legal mortgage over the Approved Aged
Care Assets.
At the same time, the Borrowers shall put the Security Trustee in
funds to pay any stamp duty payable in connection with such
mortgage.
(c) (Further assurances): the Borrowers shall on demand by a
Financier and at the entire cost and expense of the
Borrowers perform all such acts and execute all such
agreements, assurances and other documents and instruments
as may be necessary to ensure that the Security Trustee (in
its capacity as trustee of the Ongoing Security Trust)
obtains a valid, registered first-ranking legal mortgage
over all Approved Aged Care Assets which comprise real
property or an interest in real property.
(d) (Shares or Stock acquired by a Borrower): to the extent to
which any Approved Aged Care Assets constitute shares or
stock in any corporation and the acquisition of such shares
or stock results in a Borrower gaining Control of that
corporation ("New Security Provider") then that Borrower
shall procure that the New Security
<PAGE> 378
Provider grants to the Security Trustee (in its capacity as
trustee of the Ongoing Security Trust) immediately after
the Borrower's acquisition of the relevant shares or stock:
(i) a first ranking legal mortgage over any real
property or interest in real property owned by the
New Security Provider and which is used in the
conduct of the Business, on the same terms as the
Real Property Mortgage (NSW) (except for such
changes to those terms as are necessary to
accommodate the real property laws in the
jurisdiction in which the property is located, or
the nature of the interest being acquired);
(ii) a Featherweight Fixed and Floating Charge over all
of the assets and undertaking of the New Security
Provider; and
(iii) a guarantee and indemnity from the New Security
Provider limited to the assets described in clause
4.3(d)(i) and (ii) on terms acceptable to the
Security Trustee in respect of all of the
Obligations.
(e) (Execution of securities): if paragraph (d) applies to any
Approved Aged Care Assets the subject of any proposed
Advance, the relevant Borrower shall procure that the New
Security Provider executes and delivers to the Financiers
contemporaneously with the Advance being made available
under this Agreement:
(i) a legal mortgage as required by paragraph (d);
(ii) a fixed and floating charge as required by paragraph
(d);
(iii) a guarantee and indemnity as required by paragraph
(d); and
(iv) such other documentation (including discharges of
Encumbrances) as may be required to ensure that the
Security Trustee obtains a registered first-ranking
security interest as envisaged by paragraph (d).
At the same time, the Borrowers shall put the Security Trustee in
funds to pay any stamp duty payable in connection with such
securities.
The Financiers shall provide the documents referred to in (i),
(ii) and (iii) above to the Security Trustee after the making of
the Advance has occurred.
(f) (Further assurances): the Borrowers shall on demand by the
Financiers procure that a New Security Provider (at the New
Security Provider's expense) performs all such acts and
executes all such agreements, assurances and other
documents and instruments as may be necessary to ensure
that the Security Trustee obtains a valid, registered first
ranking security over all the property, assets and
undertaking of the New Security Provider.
<PAGE> 379
4.4 Security - Capital Expenditure
If:
(a) it is proposed that an Advance will be applied towards
capital expenditure in respect of Approved Aged Care Assets
which have been acquired by a Borrower; and
(b) that capital expenditure involves the acquisition by a
Borrower of any property (including plant and equipment)
over which the Security Trustee does not already have
security,
the Borrower referred to in paragraph (b) shall grant to the Security
Trustee (in its capacity as trustee of the Ongoing Security Trust)
security over such property on such terms and in such form as the
Security Trustee may reasonably require.
The Borrowers shall, contemporaneously with the provision of such
security, put the Security trustee in funds to pay any stamp duty payable
in connection with such Security.
4.5 Certification
For the purposes of this clause, "certified" means a copy certified to be
such by a director, secretary or general manager of the relevant
Borrower.
5. REPAYMENT AND PREPAYMENTS
5.1 Repayment
The Borrowers will repay to the Financiers all Advances together with all
other money the payment or repayment of which forms part of the
Obligations on the Termination Date.
5.2 Prepayment
(a) A Borrower may prepay the whole or part of an Advance (if
part, in a minimum of $1,000,000 and then multiples of
$250,000 or, in the case of a prepayment as a result of a
Lessee Purchase, the amount of the prepayment may be the
amount paid to the Borrower as a result of such Lessee
Purchase) on the last day of its current Interest Period by
giving not less than 3 Banking Days' prior written notice
to the Financiers.
(b) Any notice of prepayment given by a Borrower is irrevocable
and the Borrower is thereby bound to prepay in accordance
with the notice.
(c) A Borrower may not prepay any Advance except in accordance
with this clause 5.2.
<PAGE> 380
(d) Interest accrued on any amount prepaid under this Agreement
will be paid at the time of prepayment.
(e) The Warehouse Facility is revolving. Accordingly, the
Borrowers may (subject to the provisions of this Agreement)
redraw the amount of any prepayment prior to the
Termination Date.
6. INTEREST
6.1 Interest Periods
(a) Not later than 3 Banking Days before the commencement of
each Interest Period in respect of an Advance, the Initial
Borrower will notify the Financiers whether that Interest
Period is to be of 30, 60 or 90 days' duration.
(b) Each Interest Period in relation to an Advance is the
period commencing on the Drawdown Date for that Advance (in
the case of the initial Interest Period) or on the last day
of the immediately preceding Interest Period for that
Advance (in the case of any subsequent Interest Period) and
ending on the day which is 30, 60 or 90 days thereafter as
the Initial Borrower notifies to the Financiers.
(c) If an Advance is drawn during an Interest Period relating
to another Advance, then unless the Financiers and the
Initial Borrower agree otherwise, the first Interest Period
relating to the further Advance ends on the last day of the
Interest Period relating to the other Advance.
(d) If the Initial Borrower does not select an Interest Period
for an Advance in accordance with clause 6.1(a), the
Interest Period will be 90 days.
(e) The term of each Interest Period is subject to any marginal
adjustment as the Financiers in their discretion determine
so that the first and last days of it are Banking Days and
the final Interest Period terminates on the Termination
Date.
(f) There must be no more than 3 Interest Periods ending on
different dates current at any particular time.
6.2 Calculation of Interest
(a) Interest on each Advance accrues daily, and is to be
computed on a daily basis on a year of 365 days.
<PAGE> 381
(b) The rate of interest for each Advance for each Interest
Period is the Higher Rate in relation thereto. If interest
is paid when due and there is then no subsisting Event of
Default, the Financiers will accept interest calculated at
the Lower Rate in relation thereto.
(c) A Financier's certificate as to the rate of interest at any
time will be conclusive and binding on the Borrowers in the
absence of manifest error on the face of the certificate.
6.3 Payment of Interest
(a) Each Borrower will pay to the Financiers the accrued
interest in relation to each Advance made available to it
in arrears on the last day of each Interest Period,
calculated up to (and including) that day.
(b) Prior to the last day of each Interest Period, the
Financiers will notify the Initial Borrower in writing of
the amount of accrued interest payable under this Agreement
in respect of that Interest Period. A copy of such notice
will be forwarded to:
Omega Healthcare Investors, Inc.
Address: 900 Victors Way
Suite 345
Ann Arbor, Michigan 48108
Facsimile: 0011 1 734 887 0301.
A failure by the Financiers to comply with this paragraph (b) will
in no way detract from or affect the obligations of any Borrower
under any provision of any Transaction Document (including clause
6.3(a)).
7. INTEREST ON OVERDUE AMOUNTS
7.1 Payment of interest
Each Borrower will pay interest on all amounts due and payable by it
under or in respect of this Agreement or the Securities and unpaid,
including interest payable under this clause 7.
7.2 Accrual of interest
Interest will accrue on all amounts due and payable from day to day from
the due date up to the date of actual payment, before and (as a separate
and independent obligation) after judgment, at the Higher Rate for
successive 30 day periods commencing on the date of default and if not
paid when due, will itself bear interest in accordance with this clause.
<PAGE> 382
8. BILL RELIQUEFICATION
8.1 Financiers' election
If the Financiers elect to utilise Bills to enable the Financiers to
reliquefy in respect of any Advance, they will immediately notify the
Initial Borrower of their election and the manner in which each Bill is
to be drawn, the face value of each Bill, and its maturity date.
8.2 Nature of Bills
(a) At the election of the Financiers, Bills to be drawn under
this clause will be either:
(i) drawn by the relevant Borrower on the Financiers
payable to the Borrower, accepted by the Financiers
and indorsed in blank by the Borrower; or
(ii) drawn by the Financiers on the relevant Borrower
payable to the Financiers and accepted by the
Borrower.
(b) Bills drawn under this clause must have:
(i) a maturity date which is no later than the then
Termination Date; and
(ii) a face value which does not exceed the relevant
Advance.
8.3 Borrower's Obligations
(a) If the Financiers elect that Bills are to be drawn by a
Borrower on the Financiers and indorsed by the Borrower,
the Borrower will deliver to the Financiers Bills so drawn
and indorsed without qualification within 2 Banking Days of
notification of that election by the Financiers.
(b) If the Financiers elect to draw Bills on a Borrower, the
Financiers will immediately deliver them to the Borrower
and the Borrower will accept the Bills without
qualification and hand them back to the Financiers within 2
Banking Days of their delivery by the Financiers to the
Borrower.
(c) Each Borrower acknowledges that its acceptance of Bills
drawn on it by the Financiers will not in itself constitute
the satisfaction by the Borrower of its obligation to pay
to the Financiers any money the payment of which forms part
of the Obligations.
<PAGE> 383
8.4 Financiers' rights and Obligations
(a) The Financiers may negotiate any Bills drawn under this
clause 8 at their discretion.
(b) In the case of Bills drawn by a Borrower and accepted by
the Financiers:
(i) the Financiers will honour each Bill on its
maturity; and
(ii) if the Financiers do not so honour each Bill and
the Borrower as drawer or indorser meets that Bill
at its maturity, the Borrower's payment to a holder
of a Bill is satisfaction of the Obligations to the
extent of the payment only.
(c) In the case of Bills drawn by the Financiers and accepted
by a Borrower:
(i) the Financiers will put the Borrower in cleared
funds to meet each Bill on its maturity; and
(ii) if the Financiers do not so put the Borrower in
funds and the Borrower meets that Bill at its
maturity, the Borrower's payment to a holder of a
Bill is satisfaction of the Obligations to the
extent of the payment only.
(d) The Financiers will be responsible for and will indemnify
each Borrower for all fees, costs and expenses incurred or
payable in respect of the preparation of any Bills drawn
under this clause 8, and for all Taxes payable in respect
of the drawing, acceptance, indorsement or other dealing in
any such Bills (other than any goods and services tax,
consumption tax, value added tax or any similar tax imposed
by any law of the Commonwealth of Australia or any State or
Territory of Australia, whether in force before or coming
into force after the date of this Agreement).
9. FEES
9.1 Establishment Fee
The Initial Borrower must pay to the Financiers the establishment fee
referred to in the Fees Side Letter in accordance with the Fees Side
Letter.
9.2 Non-Usage Fee
(a) The Borrowers shall pay to the Financiers a non-usage fee
equal to 0.25% p.a. of the Undrawn Commitment.
<PAGE> 384
(b) The Non-Usage Fee shall be calculated on a daily basis on
the Undrawn Commitment on that day.
(c) The Non-Usage Fee shall be payable quarterly in arrears on
the last day of each Financial Quarter.
(d) Prior to the last day of each Financial Quarter, the
Financiers will notify the Initial Borrower in writing of
the amount of the Non-Usage Fee payable in respect of that
Financial Quarter. A copy of such notice will be forwarded
to:
Omega Healthcare Investors, Inc.
Address: 900 Victors Way
Suite 345
Ann Arbor, Michigan 48108
Facsimile: 0011 1 734 887 0301
A failure by the Financiers to comply with this paragraph (d),
will in no way detract from or affect the obligations of any
Borrower under any provision of any Transaction Document
(including this clause 9.2).
9.3 Fees Non-refundable
Each fee referred to in clauses 9.1 or 9.2 is not refundable to the
Borrowers in any circumstances.
10. PAYMENTS
10.1 Time and place
Unless expressly provided otherwise in writing, all payments by a
Borrower under any Transaction Document are to be made to the Financiers
in Dollars in immediately available funds not later than 12.00 noon local
time on the due date to the account the Financiers from time to time
designate, or as otherwise agreed between the Borrower and the
Financiers.
10.2 No deduction for Taxes and no set-off or counterclaim
All payments by a Borrower under any Transaction Document, whether of
principal, interest or other amounts due under that document, will be:
(a) free of any set-off or counterclaim; and
(b) without deduction or withholding for any present or future
Taxes unless the Borrower is compelled by law to deduct or
withhold the same, in which event the Borrower will pay to
the Financiers any additional amounts necessary to enable
the Financiers to receive, after
<PAGE> 385
all deductions and withholding for Taxes, a net amount
equal to the full amount which would otherwise have been
payable had no such deduction or withholding been required
to be made.
10.3 Merger
If the liability of a Borrower to pay to the Financiers any money the
payment or repayment of which forms part of the Obligations becomes
merged in any judgment or order, the Borrower as an independent
obligation will pay interest at the rate which is the higher of that
payable under this Agreement and that fixed by or payable under the
judgment or order.
10.4 Conversion of Foreign Currency receipts to Dollars
(a) Notwithstanding the obligation under clause 10.1 of the
Borrowers to make all payments in Dollars, if any payment
is tendered to the Financiers under any Transaction
Document in a Foreign Currency the Financiers at their
absolute discretion may accept payment in the Foreign
Currency as tendered.
(b) If any payment in a Foreign Currency is tendered to and
accepted by the Financiers, or any funds are recovered by
the Financiers under any Transaction Document in a Foreign
Currency, the Financiers at their absolute discretion may
actually or notionally convert such payment or funds to
Dollars at such time or times as it sees fit and at such
rate or rates as it is, or considers it would be, able to
obtain in the market at the time of such conversion. The
amount of Dollars actually or notionally received after the
conversion will be applied in reduction of the Obligations.
10.5 Costs of conversion
The Borrowers will pay all commissions and expenses involved in actually
or notionally converting any payment or receipt in a Foreign Currency
into Dollars.
10.6 Foreign Currency indemnity
If Foreign Currency is received by the Financiers as a result of a court
or tribunal order or as a result of a distribution under an Insolvency
Provision, then as a separate, additional and continuing liability
(notwithstanding the order or distribution), the Borrowers will pay to
the Financiers any deficiency in the amount of Dollars actually received
by the Financiers resulting from any variation between:
(a) the rate of exchange at which the amount of Foreign
Currency was calculated for the purposes of the court or
tribunal order or the distribution; and
<PAGE> 386
(b) the rate of exchange at which the Financiers are able to
purchase Dollars with the amount of Foreign Currency
actually received by the Financiers.
11. ILLEGALITY AND INCREASED COSTS
11.1 Illegality
If any change in applicable law, regulation, treaty or official directive
or in the interpretation or administration thereof by any governmental
authority charged with their administration makes it unlawful or
impossible for the Financiers to maintain or give effect to its
obligations under this Agreement, the Financiers may give a notice to the
Initial Borrower appointing a date, which will be not less than 45 days
from the date of the notice, as the Termination Date.
The Financiers agree to use reasonable endeavours, during the period of
45 days referred to above, to make the financial accommodation provided
under this Agreement available by some alternative means to avoid the
illegality (including changing its lending office to another existing
lending office or making the financial accommodation available through a
Related Body Corporate of the Financiers).
11.2 Increased cost
(a) If because of any change in law or in its interpretation or
administration or because of compliance with any request
from or requirement of any fiscal, monetary or other
authority:
(i) the Financiers incur a cost as a result of their
having entered into or performed their obligations
under the Warehouse Facility or as a result of any
Advance or Bills being outstanding under this
Agreement;
(ii) there is any increase in the cost to the Financiers
of funding or maintaining any Advance made or to be
made under this Agreement;
(iii) the amount of principal or interest or any other
amount payable to the Financiers or the effective
return to the Financiers under this Agreement is
reduced; or
(iv) the Financiers become liable to make any payment
(not being a payment of Tax on its overall net
income) on or calculated by reference to the amount
of Advances made hereunder or Bills outstanding
under this Agreement,
then from time to time on notification by the Financiers the
Borrowers will pay to the Financiers amounts sufficient to
indemnify the Financiers against that cost, increased cost,
reduction or liability.
<PAGE> 387
(b) If the Financiers have acted in good faith it is no defence
that the cost, increased cost, reduction or liability could
have been avoided. At the request of the Initial Borrower
however, the Financiers will negotiate in good faith with
the Borrowers to minimise the cost, increased cost,
reduction or liability.
(c) A certificate from the Financiers as to the amount of, and
basis for arriving at, any cost, increased cost, reduction
or liability is conclusive and binding on the Borrowers in
the absence of manifest error on the face of the
certificate.
(d) If a demand for additional amounts is made under this
clause 11.2 then the Financiers agree to use reasonable
endeavours for a period of 45 days to either:
(i) make the relevant financial accommodation available
by alternative means (including by changing its
lending office to another existing lending office or
making the financial accommodation available through
a Related Body Corporate of the Financiers) so the
increase in cost or the circumstance referred to in
clause 11.2(a) no longer applies and that no other
additional expense arises as a result of using the
alternative means; or
(ii) assist the Borrowers to find another financial
institution to assume responsibility for the
obligations of the Financiers under this Agreement
on that basis that the increase in cost or the
circumstances referred to in clause 11.2(a) that
applies to the Financiers does not apply to the
substitute.
12. REPRESENTATIONS AND WARRANTIES
12.1 General representations and warranties
Each Borrower represents and warrants to the Financiers that:
(a) (Legally binding obligation): each Transaction Document to
which it is a party constitutes a valid and legally binding
obligation of it in accordance with its terms;
(b) (Execution, delivery and performance): the execution,
delivery and performance of each Transaction Document to
which it is a party does not violate any existing law or
regulation or any document or agreement to which it is a
party or which is binding on it or any of its assets;
<PAGE> 388
(c) (Authorisation): all consents, licences, approvals and
authorisations of every government authority required to be
obtained by it in connection with the execution, delivery
and performance of each Transaction Document to which it is
a party have been obtained and are valid and subsisting;
(d) (Information): all information relating to it provided to
the Financiers in connection with the Warehouse Facility
and each Transaction Document is true in all material
respects and is not, by omission or otherwise, misleading
in any material respect;
(e) (No material adverse effect): no litigation, arbitration,
criminal or administrative proceedings are current, pending
or, to its knowledge threatened which if adversely
determined would or could have a material adverse effect on
its business, assets or financial condition;
(f) (No Event of Default): no event has occurred which
constitutes an Event of Default or a Potential Event of
Default;
(g) (Laws): it has not failed to comply with any statute or
regulation relative to it and the business carried on by it
where such failure may have a material adverse effect on
its ability to observe its obligations under the
Transaction Documents to which it is a party;
(h) (Borrowings): it is not in default in the payment of any
material sum, or in the performance or observance of any
material obligation in respect of any Borrowing, and no
event has occurred which with the giving of notice, lapse
of time or other condition could constitute a material
default in respect of any Borrowing;
(i) (No trusts): it is not the trustee of any trust (other
than, in the case of the Initial Borrower, the PHF Trust
and, in the case of any New Borrower, any Permitted Trust)
and does not hold any property subject to or impressed by
any trust (other than, in the case of the Initial Borrower,
the PHF Trust and, in the case of any New Borrower, any
Permitted Trust); and
(j) (No guarantees): (except as provided in the Transaction
Documents or as required in the ordinary course of the
Business) there are no bonds, guarantees or indemnities
currently binding on it nor has it entered into any
obligation to provide any bond, guarantee or indemnity.
<PAGE> 389
12.2 Corporate representations and warranties
Each Borrower represents and warrants to the Financiers that:
(a) (Due incorporation): it is duly incorporated and has the
corporate power to own its own property and to carry on its
business;
(b) (Constitution): the execution, delivery and performance of
each Transaction Document to which it is a party does not
violate its constitution;
(c) (Corporate power): it has the power, and has taken all
corporate and other action required, to enter into any
Transaction Document to which it is a party and to
authorise the execution and delivery thereof and the
performance of its obligations thereunder; and
(d) (Filings): it has filed all corporate notices and effected
all registrations with the Australian Securities Commission
or similar office in its jurisdiction of incorporation and
in any other jurisdiction as required by law and all such
filings and registrations are current, complete and
accurate.
12.3 Trust Representations and Warranties
The Initial Borrower represents and warrants to the Financiers that:
(a) (Trustee): it enters, or has entered, into the Transaction
Documents to which it is a party in its capacity as trustee
of the PHF Trust;
(b) (Trust validly created): the PHF Trust has been validly
created and is in existence at the date of this Agreement;
(c) (Sole trustee): it has been validly appointed as trustee of
the PHF Trust and is presently the sole trustee of the PHF
Trust;
(d) (Trust Deed): the PHF Trust is solely constituted by the
Trust Deed, (a true copy of which was provided to the
Financiers or their agent prior to the date of this
Agreement) and the Trust Deed discloses all the terms of
the PHF Trust other than terms implied by law;
(e) (Trustee's power): it has full and free power to enter into
the Transaction Documents to which it is a party in its
capacity as trustee of the PHF Trust;
(f) (Trust authorisations): it has in full force and effect all
authorisations necessary to enter into the Transaction
Documents as trustee of the PHF Trust, and to perform its
obligations under them;
<PAGE> 390
(g) (No removal of trustee): no action has been taken or is
proposed to remove it as trustee of the PHF Trust;
(h) (No default of trustee): it is not in default under the
Trust Deed which would have the effect of limiting or
removing its right of indemnity from the property of the
PHF Trust, or would affect its power or ability to enter
into the Transaction Documents to which it is a party (or
to perform its obligations under the Transaction Documents
to which it is a party) as trustee of the PHF Trust;
(i) (Trust obligations): it and its directors and other
officers have complied with their obligations in connection
with the PHF Trust;
(j) (Vesting date not declared): a date has not been declared
pursuant to the Trust Deed as the date on which the PHF
Trust will be vested or come to an end, and no other action
has been taken or is proposed to terminate the PHF Trust;
(k) (No proceedings): no proceedings of any description have
been or are likely to be commenced or threatened which
could have a material adverse effect on the assets or
financial position of the PHF Trust or on its trusteeship
thereof;
(l) (No acquisition of trust assets): it has not done, or
failed to do, any act whereby any of the assets of the PHF
Trust have been acquired by any other person and no assets
of the PHF Trust are presently registered in the name of
any other person and no person, other than the Trustee and
the beneficiaries of the PHF Trust from time to time, has
acquired any right of any kind whether vested or contingent
in any asset of the PHF Trust;
(m) (Indemnity): it has a right to be fully indemnified out of
the property of the PHF Trust in respect of obligations
incurred by it under the Transaction Documents to which it
is a party;
(n) (Commercial benefit): it is to the commercial benefit of
the PHF Trust that it enters into the Transaction Documents
to which it is a party in its capacity, inter alia, as
trustee of the PHF Trust and encumbers the property of the
PHF Trust as provided in the Securities; and
(o) (Ranking): the Financiers' and the Security Trustee's
rights under the Securities rank (in relation to the
Security Property only) in priority to the interests of the
beneficiaries of the PHF Trust.
<PAGE> 391
If and to the extent that a New Borrower is the trustee of a Permitted
Trust, the New Borrower shall be deemed to have made the representations
and warranties contained in this clause 12.3 in respect of that Permitted
Trust.
12.4 Representations and warranties repeated
Each representation and warranty contained in clauses 12.1, 12.2 and 12.3
will be repeated on each day whilst any money the payment or repayment of
which forms part of the Obligations remain outstanding (whether or not
then due for payment) or the Warehouse Facility is available for
drawdown, with reference to the facts and circumstances then subsisting,
as if made on each such day.
12.5 No representation by Financiers
Each Borrower acknowledges that it has not entered into this Agreement or
any other Transaction Document to which it is a party as a result of any
representation, promise, statement or inducement to it by or on behalf of
the Financiers or any other person.
13. UNDERTAKINGS
13.1 General undertakings
For as long as any amount is outstanding under the Warehouse Facility or
the Warehouse Facility is available for drawdown, each Borrower
undertakes to the Financiers that it will:
(a) (Perform Obligations): perform, fulfil and observe the
Obligations;
(b) (Maintain all consents): obtain, renew, maintain and comply
with all consents, licences, approvals and authorisations
reasonably necessary for the validity and enforceability of
the Transaction Documents to which it is a party, the
performance of its obligations hereunder and thereunder,
and the effectiveness of each Security as a security with
the stated priority; and it will promptly provide copies of
these to the Financiers when these are obtained or renewed;
(c) (Comply with Statutes): comply with all statutes and all
lawful requirements of every government authority which
relate to the Business;
(d) (Proper books of account): keep or cause to be kept proper
books of account, in which it will make true entries of all
dealings and transactions now or in the future conducted by
it, including, in respect of its business, that it will
keep the books of account, vouchers and all other documents
relating to its affairs and its business at its registered
office or other place where those books of account,
vouchers and documents of a similar nature have previously
been
<PAGE> 392
kept, and will ensure that they are available at all
reasonable times following an Event of Default for
inspection and copying by the Financiers or any employee,
agent or professional adviser of the Financiers that the
Financiers appoint;
(e) (Audit): unless otherwise directed by the Financiers, cause
its books of account, and (in the case of the Initial
Borrower) the books of account of the PHF Trust, to be duly
audited by a registered company auditor at least once in
every year;
(f) (Financial information): furnish to the Financiers:
(i) as soon as practicable and in any event not later
than 120 days after the close of each of its
financial years, a copy of its (consolidated, if
applicable) (and, in the case of the Initial
Borrower, the PHF Trust's) audited balance sheet and
trading and profit and loss account for that
financial year certified as correct by a registered
company auditor;
(ii) as soon as practicable and in any event not later
than 60 days after each of its half-financial years,
a copy of its (and, in the case of the Initial
Borrower, the PHF Trust's) unaudited semi-annual
management accounts for such period; and
(iii) promptly, any further information regarding its
(and, in the case of the Initial Borrower, the PHF
Trust's) financial condition and business operations
(or regarding any proposal to which the Financiers
have been requested to consent under this Agreement)
as the Financiers from time to time reasonably
require;
(g) (Compliance with accounting standards): ensure that each
balance sheet and trading and profit and loss account
furnished to the Financiers is prepared in accordance with
its Articles of Association, the Corporations Law, any
other applicable legislation and all accounting principles
and practices generally accepted in Australia consistently
applied, or if not consistently applied, accompanied by
details of the inconsistencies, and will give a true and
fair view of its financial condition and the result of its
operations as at the date, and for the period ending on the
date, to which those accounts are prepared;
(h) (Consolidated and unconsolidated accounts): ensure that if
any balance sheet and trading and profit and loss account
furnished under this Agreement discloses the consolidated
financial condition and results of the operations of more
than one corporation, it is accompanied by an unaudited
unconsolidated balance sheet and trading and profit and
loss account that complies with all other requirements in
this Agreement in relation to balance sheets and trading
and profit and loss accounts for each corporation;
<PAGE> 393
(i) (Certificate of default): as and when reasonably required
by the Financiers, furnish the Financiers with a
certificate signed by a director of the Borrower stating to
the best knowledge of such director whether or not an Event
of Default or a Potential Event of Default has occurred
and, if it has, setting out the details and the steps (if
any) taken by the Borrower to remedy or cure the same;
(j) (Notification of certain events): immediately notify the
Financiers in writing as soon as it becomes aware of the
occurrence of:
(i) (Event of Default): any Event of Default or
Potential Event of Default;
(ii) (Litigation): any litigation, arbitration, criminal
or administrative proceedings or labour disputes
relating to the Borrower or the Borrower's property,
assets or revenues that involves a claim against the
Borrower in excess of $250,000 or that, if decided
adversely to the Borrower, could have a material
adverse effect on the ability of the Borrower to
perform the Obligations;
(iii) (Bills): any change in the persons authorised by it
to sign notices, certificates or other documents in
connection with the Warehouse Facility with specimen
signatures of any new person so authorised, and
giving to the satisfaction of the Financiers
evidence, where requested by the Financiers, of the
authority of that person; or
(iv) (Trustee): it becoming or being appointed the
trustee of any trust (other than the PHF Trust or a
Permitted Trust) or comes to hold any property
subject to or impressed by any trust (other than the
PHF Trust or a Permitted Trust);
(k) (Notification etc. of Transfer or Issue of Units):
whenever reasonably requested by the Financiers, notify the
Financiers of any proposed transfer, redemption or creation
of units in the PHF Trust or any Permitted Trust (including
the creation of new classes of units) since the Financiers
were last provided with a notice under this clause 13.1(k)
(or since the date of this Agreement, in the case of the
first request under this clause 13.1(k)), and provide the
Financiers with such details of the proposed transfer,
redemption or creation (as the case may be) as the
Financiers may reasonably require;
(l) (Restriction of dealings): other than as a result of a
transfer, redemption or creation of units in the PHF Trust
(including the creation of new classes of units) not
(without the prior written consent of the Financiers, which
will not be unreasonably withheld) sell or otherwise
dispose of or create any interest in any Security Property;
<PAGE> 394
(m) (Proceeds of Sale of Security Property): except to the
extent that the Financiers otherwise consent, ensure that
any proceeds of sale (or subdivision) of any Security
Property are applied in reduction of the indebtedness of
the Borrowers under this Agreement;
(n) (Negative Pledge): not, create, permit or suffer to exist
any Encumbrance over the Security Property or agree to do
so without the prior written consent of the Financiers,
except for:
(i) the Securities; and
(ii) encumbrances created by statute in favour of
governmental or semi-governmental authorities or
departments securing the payment of Taxes except as
created because of any failure to duly pay any
Taxes;
(o) (No provision of financial accommodation): not make the
proceeds of any Advance available to any Related Body
Corporate of the Borrower or OWI without the prior written
approval of the Financiers (which may not be unreasonably
withheld); and
(p) (Guarantees): except as permitted or required by the
Transaction Documents or as required in the ordinary course
of its business (as determined by the Borrower in good
faith), the Borrower will not without the prior written
consent of the Financiers (which may not be unreasonably
withheld) enter into any bond, guarantee or indemnity in
favour of any person other than a Financier.
13.2 Undertakings relating to the Security Property
For as long as any amount is outstanding under the Warehouse Facility or
the Warehouse Facility is available for drawdown, each Borrower
undertakes to the Financiers that:
(a) (Good repair): where applicable, it will (or will procure
that the lessee of the Security Property will) maintain and
protect the Security Property owned by it and keep the same
in a good and tenantable state of repair and in good
working order and condition;
(b) (Insurance): in respect of Security Property owned by it:
(i) it will maintain (or procure that the relevant
Operator maintains) at all times the insurances
required under the terms of the Lease and any other
documentation between an Operator and the Borrower
concerning the operation and use of the relevant
Approved Aged Care Assets. Such insurances must
cover the risks provided for in such Lease or other
documentation;
<PAGE> 395
(ii) the insurance referred to in sub-paragraph (i) must
be taken out with a reputable, responsible and
solvent insurer on terms and in an amount reasonably
acceptable to the Financiers;
(iii) it will procure that each insurance policy has noted
on it the name of the Security Trustee as loss
payee;
(iv) it will duly and punctually pay (or procure that the
relevant Operator pays) all premiums, commissions,
stamp duties, charges and other expenses necessary
for effecting and maintaining in force each
insurance policy;
(v) it will on reasonable request deliver (or procure
that the relevant Operator delivers) to the
Financiers certificates of currency in respect of
all such insurances and all other details as to the
insurances that the Financiers require;
(vi) it will not do anything or permit anything to be
done which may prejudice any policy or omit to do
anything where that omission may prejudice a policy;
(vii) it will procure that each insurance policy provides
that the proceeds of any loss in respect of
insurance of the Security Property will, subject to
the terms of any lease of the Security Property, be
paid to the Security Trustee; and
(viii) if the Borrower defaults in effecting or keeping up
any insurance policy with respect to the Security
Property or if any insurance policy from any cause
becomes void or voidable, the Financiers may (but
are not obliged to) effect or keep up that insurance
policy at the cost of the Borrower;
(c) (Outgoings): it will duly and punctually pay (or procure
that the relevant Operator pays) when due all outgoings
(including rent and Taxes) payable in respect of the
Security Property.
13.3 Trust undertakings
The Initial Borrower undertakes to the Financiers that:
(a) (Observance of obligations): it will observe its
obligations as trustee of the PHF Trust;
(b) (New Trustee): it will notify the Financiers immediately in
writing if it ceases for any reason or at any time to be
the sole trustee of the PHF Trust;
<PAGE> 396
(c) (New Trustee): it will, before it ceases to be the sole
trustee of the PHF Trust, procure any new trustee of the
PHF Trust to execute in favour of the Financiers any
undertakings, covenants, guarantees, agreements or
securities relating to the Warehouse Facility as the
Financiers reasonably require;
(d) (Interest to be subjugated): it will not, without the prior
written consent of the Financiers, exercise in its own
favour personally, any right of indemnification,
reimbursement, recoupment, lien or charge to which it might
be entitled personally against or in respect of all money
or other assets forming part of the PHF Trust. If any money
or other assets which once formed part of the PHF Trust are
at any time in its hands freed of their trust character by
virtue of the exercise or purported exercise of any right
of indemnification, reimbursement, recoupment, lien or
charge, it will hold that money and/or those assets on
trust for the Financiers for the extent to which any
liability under the Transaction Documents has not been
satisfied;
(e) (Determination of PHF Trust etc.): it will notify the
Financiers immediately in writing if the PHF Trust is
determined or for any other reason ceases to exist and will
also notify the Financiers immediately in writing if it is
required or directed by any of the beneficiaries of the PHF
Trust to do any act or thing in relation to the PHF Trust
or the trust funds thereof;
(f) (No Distribution): (except as contemplated by the
Relationship Agreement as at 19 June 1998) a distribution
or return of any of the capital of the PHF Trust will not
be made without the prior written consent of the
Financiers; and
(g) (PHF Trust Statements): it will furnish to the Financiers
whenever reasonably required by the Financiers a copy of
the current financial statements of the PHF Trust certified
as correct by a registered company auditor.
If and to the extent that a New Borrower is the trustee of a Permitted
Trust, the New Borrower shall be bound by the undertakings contained in
this clause 13.3 as though references to the PHF Trust in this clause
13.3 were references to that Permitted Trust.
14. DEFAULT AND TERMINATION
14.1 Events of Default
Each of the events set out below is an Event of Default, whether or not
the cause is beyond the control of a Borrower or any other person:
(a) (Failure to pay): a Borrower does not pay at or before the
due time on the due date and in the specified manner, any
amount payable by it under any Transaction Document to
which it is a party;
<PAGE> 397
(b) (Failure to comply): a Borrower defaults in fully
performing, observing and fulfilling any material provision
of any Transaction Document to which it is a party (other
than a provision requiring the payment of money as
described in clause 14.1(a)), and if that default is
capable of remedy, it has not been remedied within 14 days
of the occurrence of the default;
(c) (Untrue warranty): any representation, warranty or
statement made, repeated or deemed to be made or repeated
by a Borrower in any Transaction Document to which it is a
party or in connection with the Warehouse Facility or any
accounts or opinion furnished in connection with the
application for the Warehouse Facility or under this
Agreement is proved to be untrue in any material respect
when made, repeated or deemed to be made, repeated or
furnished (as the case may be);
(d) (Breach of undertaking): a Borrower breaches any material
undertaking given at any time to a Financier or fails to
comply with any condition imposed by a Financier in
agreeing to any matter (including any waiver);
(e) (Event of Default under Transaction Document): any event of
default occurs under any Transaction Document and is not
remedied within any period permitted in the relevant
Transaction Document, or waived;
(f) (Event of Insolvency): any Insolvency Event occurs in
respect of a Borrower or any of its Related Bodies
Corporate;
(g) (Investigation): an investigation into the affairs or
particular affairs of a Borrower or any of its Related
Bodies Corporate is directed or commenced under the
Corporations Law;
(h) (Trust Deed): the Trust Deed is varied, amended or
terminated without the prior written consent of the
Financiers in a manner which is likely, in the reasonable
opinion of the Financiers, to have a material adverse
effect on the Initial Borrower's ability to perform its
obligations under the Transaction Documents to which it is
a party (or the constituent documents of any Permitted
Trust are varied, amended or terminated without the prior
written consent of the Financiers in a manner which is
likely, in the reasonable opinion of the Financiers, to
have a material adverse effect on the relevant New
Borrower's ability to perform its obligations under the
Transaction Documents to which it is a party);
<PAGE> 398
(i) (Cessation of business): a Borrower or any of its Related
Bodies Corporate ceases, or threatens to cease, to carry on
all or a substantial part of the Business;
(j) (Essential Lease Terms etc.):
(i) the identity of the person responsible for the
operation of any Approved Aged Care Assets is
changed and the written consent of the Financiers to
such change (such consent not to be unreasonably
withheld) is not obtained within 2 months of the new
operator being appointed; or
(ii) any of the Essential Lease Terms applicable to any
Operator are amended, varied or waived without the
prior written consent of the Financiers;
(k) (Cross-default):
(i) any default occurs under any Borrowing of a Borrower
or OWI (whilst OWI is a guarantor of the Warehouse
Facility) if such default gives (or with the giving
of notice or the lapse of time or both would give)
to the person who provided such Borrowing the right
to terminate the Borrowing or accelerate the
obligation to repay the Borrowing; or
(ii) any demand or claim for an amount greater than
$500,000 is made under any bond, guarantee or
indemnity given by a Borrower or OWI (whilst OWI is
a guarantor of the Warehouse Facility) in favour of
any person, and is not waived or withdrawn;
(l) (Void or voidable): any Transaction Document is, becomes or
is claimed by a Borrower or any of its Related Bodies
Corporate to be, void, voidable or unenforceable in whole
or in part;
(m) (Illegality): at any time it is unlawful for a Borrower or
any of its Related Bodies Corporate to perform any of its
obligations under any Transaction Document to which it is a
party;
(n) (Failure to comply with laws): a Borrower fails to duly and
punctually comply with all statutes and other laws binding
on it and the result is likely, in the reasonable opinion
of the Financiers, to have a material adverse effect on the
Borrower's ability to perform its obligations under the
Transaction Documents to which it is a party;
(o) (Reduction in capital): without the prior written consent
of the Financiers, a Borrower takes action to reduce its
share capital (other than a reduction of share capital
undertaken whilst the Borrower is solvent on terms approved
by the Financiers);
<PAGE> 399
(p) (Reserve liability): without the prior written consent of
the Financiers, any meeting of a Borrower is convened for
the purpose of considering or passing a special resolution
under section 254N of the Corporations Law or any such
resolution is proposed at any meeting of a Borrower;
(q) (Management of Initial Borrower): Omega (Australia) Pty
Limited, OWI, Omega Healthcare Investors, Inc or Omega (UK)
Limited ceases to provide management services to the
Initial Borrower; or
(r) (Material adverse change): any other event or series of
events occurs, whether related or not, and including,
without limitation, any material adverse change in the
business assets or financial condition of a Borrower, the
PHF Trust or a Permitted Trust which in the reasonable
opinion of the Financiers could affect the ability or
willingness of any Borrower to perform, observe and fulfil
all or any of its material obligations under any
Transaction Document to which it is a party.
14.2 Rights of Financiers on Event of Default
If any Event of Default occurs, the Financiers may by written notice to
the Initial Borrower:
(a) declare the obligations of the Financiers under this
Agreement to be cancelled immediately and the same and the
Warehouse Facility will be cancelled immediately; and/or
(b) declare all Advances and all other money the payment of
which forms part of the Obligations immediately due and
payable, and the same shall thereupon be immediately due
and payable.
14.3 Review Event
It shall be a review event if (without the prior written consent of the
Financiers):
(a) (Change of Control): any change in the Control of a
Borrower, the PHF Trust or a Permitted Trust occurs; or
(b) (Moran Documents): any material breach of, or default
under, any Moran Document or Operator Document occurs which
results, or is reasonably likely to result, in any
termination or repudiation of that Moran Document or
Operator Document, and:
<PAGE> 400
(i) the Borrowers fail to demonstrate to the
satisfaction of the Financier that they have taken,
or are taking, steps to remedy that breach or
default or its effect (which remedy may include the
replacement of the current Operator with a new
Operator); and
(ii) the breach or default is likely, in the reasonable
opinion of the Financier, to have a material adverse
effect on the ability of any Borrower to perform its
obligations under the Transaction Documents to which
it is a party.
14.4 Consequences of Review Event
If all of the following conditions are satisfied:
(a) a Review Event occurs; and
(b) the Borrowers fail to satisfy the Financiers, within 28
days of the Review Event occurring, that the Review Event
will not affect the ability or willingness of any Borrower
to perform, observe and fulfill all or any of its material
obligations under any Transaction Document to which it is a
party; and
(c) the Financiers notify the Initial Borrower in writing of
the failure of the Borrowers to satisfy the Financiers of
the matters referred to in paragraph (b),
then an Event of Default shall be taken to have occurred at the time of
the giving of the notice referred to in paragraph (c).
15. ADDITIONAL INDEMNITY
Each Borrower agrees to indemnify the Financiers and keep the Financiers
indemnified against any loss, cost or expenses which the Financiers may
sustain or incur as a consequence of:
(a) any sum payable by a Borrower under this Agreement not
being paid when due;
(b) the occurrence of any Event of Default or Potential Event
of Default;
(c) an Advance requested in a Drawdown Request not being
provided for any reason including failure to fulfil any
Condition Precedent but excluding any default by the
Financiers; or
(d) the Financiers receiving payments of principal other than
on the last day of an Interest Period for any reason
including prepayment in accordance with a Transaction
Document.
<PAGE> 401
Such losses, costs or expenses will include the amount determined in good
faith by the Financiers as being loss including loss of margin, cost or
expense incurred by reason of the liquidation or re-employment of
deposits or other funds acquired or contracted for by the Financiers to
fund or maintain the Advance or amount.
16. EXPENSES AND STAMP DUTIES
16.1 Expenses
The Borrowers will on demand reimburse the Financiers for, and keep the
Financiers indemnified against, all expenses including legal fees, costs
and disbursements on a solicitor/own client basis assessed without the
necessity of taxation incurred by the Financiers in connection with:
(a) (Preparation): the preparation and execution of the
Transaction Documents and any subsequent consent,
agreement, approval or waiver thereunder or amendment
thereto; and
(b) (Enforcement): the enforcement, attempted enforcement or
the preservation of any rights under the Transaction
Documents including, without limitation, any expenses
incurred in the evaluation of matters of material concern
to the Financiers.
16.2 Stamp Duties
(a) (Payment of all duties): The Borrowers must pay all stamp,
loan transaction, registration and similar Taxes, including
fines and penalties, financial institutions duty and debits
tax which may be payable to or required to be paid by any
applicable authority or determined to be payable in
connection with the execution, delivery, performance or
enforcement of the Transaction Documents or any payment,
receipt or any other transaction contemplated by them.
(b) (Indemnity): Each Borrower will indemnify and keep
indemnified the Financiers against any loss or liability
incurred or suffered by it as a result of the delay or
failure by the Borrower to pay Taxes.
17. ASSIGNMENTS
17.1 Assignments by the Financiers
The Financiers may at any time assign or otherwise transfer all or any
part of their rights under any Transaction Document to another bank or
financial institution and may disclose to a proposed assignee or
transferee information in the possession of the Financiers relating to
any Borrower.
<PAGE> 402
17.2 Assignments by the Borrowers
A Borrower cannot assign any part of its rights under any Transaction
Document without the prior written consent of the Financiers.
17.3 Successors and assigns
This Agreement is binding on and enures to the benefit of each party to
it and that party's respective successors and permitted assigns.
18. SYNDICATION
18.1 Financiers may syndicate
(a) A Financier may at any time transfer part of its rights and
obligations under the Transaction Documents and the FAI
Transaction Documents to another bank or financial institution
approved by the Initial Borrower (acting reasonably), provided
that such transfer is effected by a substitution in accordance
with this clause 18.
(b) Notwithstanding any other provision of this clause 18, a Financier
may not (without the prior consent of the Initial Borrower, which
may not be unreasonably withheld or delayed) transfer part of its
rights and obligations under the Transaction Documents and the FAI
Transaction Documents under this clause 18 prior to the first
anniversary of the date of this Agreement if such transfer would
result in the ABN AMRO Commitment being less than 30% of the Total
Commitment. This restriction shall not apply after the first
anniversary of the date of this Agreement (and nothing in this
clause affects the right of the Financiers to not agree to extend
the Termination Date beyond the first anniversary of the date of
this Agreement).
18.2 Substitution
(a) If a Financier ("Transferring Financier") wishes to
transfer part of its rights and obligations under the
Transaction Documents and the FAI Transaction Documents to
another bank or financial institution:
(i) the Transferring Financier, the proposed New
Financier, the Initial Borrower, OWI and the
Facility Agent must each execute 4 counterparts of a
Substitution Certificate;
(ii) the proposed New Financier must execute an
application for a Stock Certificate under the
Debenture Stock Trust Deed (Ongoing Assets) having a
Face Amount of $100 (in the form of Schedule 2 of
the Debenture Stock Trust Deed (Ongoing Assets)) in
such place as the Security Trustee may approve, and
pay the relevant subscription money to the Initial
Borrower;
<PAGE> 403
(iii) the Initial Borrower must execute an acceptance of
the application for Stock Certificate (in the form
of Schedule 3 of the Debenture Stock Trust Deed
(Ongoing Assets)) in such place as the Security
Trustee may approve;
(iv) the Initial Borrower must issue a Stock Certificate
under the Debenture Stock Trust Deed (Ongoing
Assets) having a Face Amount of $100 to the proposed
New Financier;
(v) the Security Trustee must endorse the Stock
Certificate referred to in (iv); and
(vi) if at the relevant time the Financiers still hold
Stock under the Original Debenture Stock Trust Deed
the New Financier, the Initial Borrower and the
Security Trustee will repeat the procedure referred
to in (ii), (iii), (iv) and (v) above in respect of
the Original Debenture Stock Trust
Deed.
As soon as a Stock Certificate is issued and endorsed pursuant to
this clause 18.2, the Security Trustee must make the appropriate
entry in the relevant Register.
To the extent to which OWI is referred to in this clause as doing
an act or thing, the Initial Borrower must procure that OWI does
that act or thing.
(b) When a Substitution Certificate is executed by all parties
to it:
(i) the Transferring Financier shall, with effect from
the "Substitution Date" specified in that
Substitution Certificate, be relieved of its
obligations under the Transaction Documents and the
FAI Transaction Documents to the extent specified in
the Substitution Certificate; and
(ii) the New Financier shall, with effect from the
"Substitution Date" specified in the Substitution
Certificate, be bound by the Transaction Documents
and the FAI Transaction Documents to the extent so
stated in the Substitution
Certificate.
(c) No transfer of a Financier's rights and obligations under
the Transaction Documents and the FAI Transaction Documents
may be effected while any Drawdown Request is current.
(d) Each party to this Agreement (other than the Borrowers and
the Transferring Financier(s)) hereby irrevocably appoints
the Facility Agent to execute Substitution Certificates on
its behalf and as its attorney.
<PAGE> 404
(e) Each Borrower (other than the Initial Borrower) hereby
irrevocably appoints the Initial Borrower to execute
Substitution Certificates on its behalf and as its
attorney.
18.3 Consent to Issue of Stock
(a) Each New Financier who becomes bound by this Agreement pursuant to
a Substitution Certificate hereby consents to any issue of any
Stock to a New Financier pursuant to clause 18.2, and directs the
Security Trustee (in both its capacity as trustee of the Ongoing
Security Trust and as trustee of the security trust constituted by
the Original Debenture Stock Trust Deed) to issue such Stock.
(b) Each New Financier who becomes bound by this Agreement pursuant to
a Substitution Certificate agrees to do everything necessary to
give effect to the consent and direction referred to in paragraph
(a) (including for the purpose of clause 5.5(b) of the Original
Debenture Stock Trust Deed and clause 5.5(b) of the Debenture
Stock Trust Deed (Ongoing Assets)).
18.4 Syndication Provisions
If a Financier transfers part of its rights and obligations under the
Transaction Documents and the FAI Transaction Documents to a New
Financier in accordance with this clause 18, then:
(a) with effect from the "Substitution Date" specified in the
Substitution Certificate (and notwithstanding any provision of any
Transaction Document or FAI Transaction Document) the Transaction
Documents and the FAI Transaction Documents shall be read and
construed subject to and in accordance with Schedule 3; and
(b) to the extent that there is any conflict between the provisions of
Schedule 3 and the provisions of any Transaction Document or FAI
Transaction Document, the provision of Schedule 3 shall prevail;
and
(c) a reference to the "Financiers" in this Agreement shall include a
reference to the New Financier, and a reference to the "Financier"
in the FAI Facility Agreement shall include a reference to the New
Financier.
18.5 Stamp Duty
Unless otherwise agreed by the Initial Borrower, all documents
contemplated by this clause 18 will be executed by all parties to those
documents in the Australian Capital Territory and all new Stock (whether
issued under the Original Debenture Stock Trust Deed or under the
Debenture Stock Trust Deed (Ongoing Assets)) will be issued to the
relevant New Financier in the Australian Capital Territory.
<PAGE> 405
19. GOVERNING LAW AND JURISDICTION
19.1 Governing law
Each Transaction Document is governed by and construed in accordance with
the laws of New South Wales.
19.2 Jurisdiction
(a) (Acceptance of jurisdiction): Each Borrower irrevocably
submits to and accepts, generally and unconditionally, the
non-exclusive jurisdiction of the courts and appellate
courts of New South Wales with respect to any legal action
or proceedings which may be brought at any time relating in
any way to any Transaction Document.
(b) (No objection to inconvenient forum): Each Borrower
irrevocably waives any objection it may now or in the
future have to the venue of any such action or proceedings
and any claim it may now or in the future have that any
such action or proceeding has been brought in an
inconvenient forum.
20. MISCELLANEOUS
20.1 Certificate of Financier
A certificate in writing signed by an officer of a Financier certifying
the amount payable by a Borrower under this Agreement to the Financiers
or stating any other act, matter or thing relating to any Transaction
Document is conclusive and binding on the Borrowers in the absence of
manifest error on the face of the certificate.
20.2 Notices
Any notice or other communication which must be given, served or made
under or in connection with any Transaction Document:
(a) must be in writing in order to be valid;
(b) is sufficient if executed by the party giving, serving or
making the same or on its behalf by any attorney, director,
secretary, other duly authorised officer or solicitor of
such party;
(c) will be deemed to have been duly given, served or made in
relation to a person if it is delivered or posted by
prepaid post to the address, or sent by facsimile to the
number of that person set out herein (or at such other
address or number as is notified in writing by that person
to the other parties from time to time); and
<PAGE> 406
(d) will be deemed to be given, served or made:
(i) (in the case of prepaid post) on the fifth day after
the date of posting;
(ii) (in the case of facsimile) on receipt of a
transmission report confirming successful
transmission; and
(iii) (in the case of delivery by hand) on delivery.
The address and facsimile numbers of the parties for the purposes of this
clause are:
The Financiers
Address: 10 Spring Street, Sydney NSW 2000
Fax No: (02) 9321 2139
Attention: Manager, Loans Administration
The Borrowers
Address: C/- Phillips Fox
255 Elizabeth Street
Sydney NSW 2000
Fax No: (02) 9283 4144
Attention: Mr Kevin Moss/Mr Bill Chapman
With a copy to each of:
Omega Healthcare Investors, Inc
Address: 900 Victors Way
Suite 345
Ann Arbor, Michigan 48108
Fax No: 0011 1 734 887 0301
and
Omega (UK) Limited
Address: 145 Cannon Street
London EC4N 5BP
Fax No: 0011 44 171 929 3555,
provided that a failure to provide a copy of a notice or communication to
either or both of Omega Healthcare Investors, Inc or Omega (UK) Limited
will not affect the validity of the notice or communication.
<PAGE> 407
20.3 Continuing obligation
Each Transaction Document constitutes a continuing obligation regardless
of any settlement of account, intervening payment, express or implied
revocation or any other matter or thing, until a final discharge has been
given to the Borrowers.
20.4 Settlement conditional
Any settlement or discharge between the Financiers and a Borrower is
conditional on any security or payment given or made to the Financiers by
the Borrower or any other person in relation to the Obligations not being
avoided, repaid or reduced by virtue of any Insolvency Provision. If a
security or payment is so avoided, repaid or reduced, the Financiers will
be entitled to recover its value or amount from the Borrower subsequently
as if the settlement or discharge had not occurred.
20.5 Further assurance
Each Borrower on demand by the Financiers and at the entire cost and
expense of the Borrower will perform all such acts and execute all such
agreements, assurances and other documents and instruments as the
Financiers reasonably require to perfect or improve the rights and powers
afforded, created, or intended to be afforded or created, by any
Transaction Document.
20.6 Attorney
Each Borrower hereby irrevocably appoints:
(a) each Financier;
(b) each director and secretary from time to time of each
Financier;
(c) each person authorised by a Financier from time to time to
execute cheques on its behalf (whether alone or jointly
with any other person); and
(d) any duly appointed agent of a Financier,
jointly and severally the attorney of the Borrower, in the Borrower's
name and on the Borrower's behalf, at any time after the occurrence of an
Event of Default and in any manner as the Financiers in their absolute
discretion think fit to:
(e) deal with, execute, draw, accept, indorse or vary the terms
of a Bill or execute and deliver all deeds, instruments and
documents and do all acts necessary or proper for any such
purpose;
(f) do all acts necessary or proper to further or fully assure
any Transaction Document or any Bill to the Financiers; and
<PAGE> 408
(g) do all acts necessary or proper to perfect or improve the
rights and powers afforded or created, or intended to be
afforded or created, by any Transaction Document.
20.7 Severability of provisions
Any provision of any Transaction Document which is illegal, void or
unenforceable will be ineffective to the extent only of the illegality,
voidness or unenforceability without invalidating the remaining
provisions of this Agreement or the Transaction Document.
20.8 Transaction Documents
Notwithstanding the collateral nature of the Transaction Documents, if
any Event of Default occurs, the Financiers are thereupon entitled to
exercise the powers arising from each and every one of the Transaction
Documents without the necessity of giving notice to any party to this
Agreement or to any other person except to the extent required by the
Transaction Documents.
20.9 Remedies cumulative
The rights and remedies conferred by this Agreement on the Financiers are
cumulative and in addition to all other rights or remedies available to
the Financiers by law or by virtue of any Transaction Document.
20.10 Waiver
A failure to exercise or enforce or a delay in exercising or enforcing or
the partial exercise or enforcement of any right, remedy, power or
privilege under any Transaction Document by the Financiers will not in
any way preclude or operate as a waiver of any further exercise or
enforcement thereof or the exercise or enforcement of any other right,
remedy, power or privilege thereunder or provided by law.
20.11 Consents and approvals
Where any act, matter or thing under any Transaction Document depends on
the consent or approval of the Financiers, then unless expressly provided
otherwise in that document, that consent or approval may be given, given
subject to any condition, or withheld in the absolute and unfettered
discretion of the Financiers.
20.12 Written waiver, consent and approval
Any waiver, consent or approval given by the Financiers under any
Transaction Document will only be effective and only binds the Financiers
if it is given in writing, or given verbally and subsequently confirmed
in writing, and executed by the Financiers or on their behalf by an
officer for the time being of the Financiers.
<PAGE> 409
20.13 Time of essence
Time is of the essence in respect of the obligations of the Borrowers
under the Transaction Documents.
20.14 Professional fees
Where the Financiers have to make any determination (whether in respect
of an Advance or otherwise), they may employ such consultants or persons
as they in their absolute discretion think fit to assist in making that
determination. The Borrowers will reimburse the Financiers for any fees
paid by the Financiers to any such persons on receipt of a written demand
therefor, and will pay any fees due direct to any such persons on request
by the Financiers.
20.15 Moratorium legislation
To the fullest extent permitted by law, the provisions of all statutes
whether existing now or in the future and whether operating directly or
indirectly to lessen or otherwise to vary or affect in favour of any
Borrower any obligation under any Transaction Document, or to delay or
otherwise prevent or prejudicially affect the exercise of any rights or
remedies conferred on the Financiers under any Transaction Document, are
hereby expressly waived, negatived and excluded.
20.16 Mutual accounts
Each Borrower authorises each Financier without prior notice to set-off
any amount owing by the Borrower under this Agreement, whether present or
future, actual, contingent or prospective and on any account, against any
liability whether present, future, actual, contingent or prospective of
the Financier to the Borrower. The Financiers are not obliged to exercise
any of its rights under this clause, which is without prejudice and in
addition to any right of set-off, combination of accounts, lien or other
right to which it is at any time otherwise entitled whether by operation
of law, contract or otherwise. The Financiers may effect such currency
exchanges as they consider appropriate in the exercise of any of their
rights under this clause.
20.17 Binding on each signatory
Each Transaction Document is binding on each of the signatories
notwithstanding that any one or more of the named parties does not
execute it, that there is any invalidity, forgery or irregularity
touching its execution, or that it is or becomes unenforceable, void or
voidable against a named party.
20.18 Counterparts
This Agreement may be executed in a number of counterparts, all of which
taken together will constitute one and the same document.
<PAGE> 410
21. NO REPRESENTATION BY OR RELIANCE ON THE FINANCIERS
Each Borrower acknowledges that:
(a) it has relied upon its own inquiries as to the nature and
extent of the entire relationship between itself and the
Financiers whether or not recorded in the Transaction
Documents, and the nature and effect of the Transaction
Documents; and
(b) it has not entered into any Transaction Document in
reliance on or as a result of any representation, promise,
statement, conduct or inducement to that party by or on
behalf of any Financier otherwise than as embodied in the
Transaction Documents.
<PAGE> 411
SCHEDULE 1
DRAWDOWN REQUEST
To: [ABN AMRO Australia Limited, ACN 000 862 797 and ABN AMRO Bank N.V.,
Australian Branch, ARBN 079 478 612]/[ABN AMRO Australia Limited,
ACN 000 862 797 as Facility Agent]
From: [Principal Healthcare Finance Pty Limited, ACN 069 875 476/details of
New Borrower]
Date: [ ]
DRAWDOWN REQUEST
Warehouse Facility Agreement dated [ ] 1998 between Principal
Healthcare Finance Pty Limited in its personal capacity and in its
capacity as trustee of the PHF Trust, ABN AMRO Australia Limited, ABN
AMRO Bank N.V., Australian Branch and ABN AMRO Facilities Australia
Limited ("Facility Agreement")
Dear Sirs
In accordance with clause 3.1 of the Facility Agreement we hereby request the
Financiers to make an Advance.
Terms used in this Drawdown Request and defined in the Facility Agreement have
the same meaning as in the Facility Agreement.
Details of the proposed Advance are as follows:
(a) Amount: $[ ].
(b) Drawdown Date: [ ].
(c) Initial Interest Period: [ ].
We propose to apply the proceeds of the Advance towards the [purchase of the
following assets/the following capital expenditure]:
[describe relevant aged care assets/capital expenditure]
[(the "Assets")/the "Capital Expenditure"].
<PAGE> 412
We undertake to you that the proceeds of the Advance will only be applied
towards [paying the purchase price of the Assets/funding the Capital
Expenditure], and we undertake to provide you with such further information
regarding the [Assets/Capital Expenditure] as you may require.
Payment instructions with respect to the proceeds of the Advance are as
follows:
[ ].
We confirm that:
(a) the representations and warranties contained in the Facility Agreement
and deemed to be repeated by clause 12.4 of the Facility Agreement are
true and correct as of the date of this Drawdown Request and will be true
and correct on the Drawdown Date as though made on that date; and
(b) no Event of Default or Potential Event of Default is subsisting at the
date of this Drawdown Request or will be subsisting at the Drawdown Date
or may result from the provision of the Advance [; and
(c) no amendments or variations to the constitution of any Borrower/Trust
Deed/constituent documents of any Permitted Trust have been made since a
certified copy was last provided to the Financiers].
We acknowledge that your obligation to make the Advance is subject to, inter
alia, your written approval of our acquisition of the Assets.
For and on behalf of
[NAME OF BORROWER]
- -------------------------------------------
[Authorised Signatory of relevant Borrower]
<PAGE> 413
SCHEDULE 2
SUBSTITUTION CERTIFICATE
SUBSTITUTION CERTIFICATE made at [ ] on [ ]
BETWEEN [INSERT DETAILS OF TRANSFERRING FINANCIER(S)] ("Existing
Financier(s)")
AND [ ] ("New Financier")
AND PRINCIPAL HEALTHCARE FINANCE PTY LIMITED ACN 069 875 467
("Initial Borrower")
AND OMEGA WORLDWIDE, INC.
AND [ABN AMRO AUSTRALIA LIMITED] ("Facility Agent")
RECITALS
A. The Existing Financier(s), the Facility Agent and the Initial Borrower
are parties to a Warehouse Facility Agreement dated [ ] 1998
("Warehouse Facility Agreement").
B. ABN AMRO Australia Limited and the Initial Borrower are party to the FAI
Facility Agreement.
C. Clause 18 of the Warehouse Facility Agreement enables the Existing
Financier(s) to transfer part of its/their rights and obligations under
the Transaction Documents and the FAI Transaction Documents to another
bank or financial institution.
D. The New Financier wishes to assume part of the rights and obligations of
the Existing Financier(s) under the Transaction Documents and the FAI
Transaction Documents.
1. DEFINITIONS AND INTERPRETATION
1.1 Definitions
In this Certificate words which are defined in the Warehouse Facility
Agreement have the same meaning when used in this Certificate, and:
"Substituted Commitments" means the Commitments specified in Item 2 of
the Schedule to this Certificate.
<PAGE> 414
"Substituted Obligations" means obligations and responsibilities
identical to the obligations and responsibilities under the Transaction
Documents and the FAI Transaction Documents of the Existing Financier(s)
in relation to the Substituted Commitments.
"Substituted Rights" means rights, remedies and powers identical to the
rights, remedies and powers under the Transaction Documents and the FAI
Transaction Documents of the Existing Financier(s) in relation to the
Substituted Commitments.
"Substitution Date" means the later of:
(a) the date of this Certificate; or
(b) such other date as the parties hereto may agree in writing.
1.2 Interpretation
A reference in this Certificate to "identical" obligations and
responsibilities or rights, remedies and powers is a reference to the
character of those obligations and responsibilities, rights, remedies and
powers rather than to the identity of the person obliged to perform them
or entitled to them.
1.3 Transaction Document
This Certificate is a "Transaction Document" for the purpose of both the
Warehouse Facility Agreement and the FAI Facility Agreement.
2. REPRESENTATION
The Existing Financier(s) represent/s and warrant/s to the New Financier
that as at the date of this Certificate the Commitments of the Existing
Financier(s) under the Warehouse Facility and the FAI Facility is/are as
set out in Item 1 of the Schedule.
3. SUBSTITUTED OBLIGATIONS
3.1 Release from Future Obligations
The Existing Financier(s) is/are released from the Substituted
Obligations with effect on and from the Substitution Date. The Existing
Financier(s) shall, however, remain bound by its/their respective
obligations and responsibilities under the Transaction Documents and FAI
Transaction Documents which accrue prior to the Substitution Date.
3.2 Assumption of Obligations
The New Financier shall assume the Substituted Obligations on and from
the Substitution Date.
<PAGE> 415
4. SUBSTITUTED RIGHTS
The Existing Financier(s) shall no longer be entitled to the Substituted
Rights, and the New Financier shall become entitled to the Substituted
Rights, with effect on and from the Substitution Date.
5. EFFECT ON TRANSACTION DOCUMENTS
With effect on and from the Substitution Date:
(a) the New Financier and each party to each Transaction Document and
each FAI Transaction Document will assume obligations and
responsibilities towards each other, and have rights, remedies and
powers in relation to each other, determined on the basis that the
obligations and responsibilities of the New Financier are the
Substituted Obligations and the rights, remedies and powers of the
New Financier are the Substituted Rights;
(b) the Existing Financier(s) will be released from its/their
obligations and responsibilities under each of the Transaction
Documents and FAI Transaction Documents accruing on and after the
Substitution Date to the extent of the Substituted Obligations and
will cease to be entitled to exercise any rights, remedies or
powers under the Transaction Documents and FAI Transaction
Documents arising on or after the Substitution Date in respect of
the Substituted Rights; and
(c) the New Financier will be deemed a party to each Transaction
Document and each FAI Transaction Document to which the Existing
Financier(s) is/are a party with Commitments equal to the
Substituted Commitments.
6. NO EFFECT ON ACCRUED RIGHTS AND OBLIGATIONS
Save as expressly provided herein this Certificate shall not affect the
Existing Financier(s)' rights, remedies and powers arising, and
obligations and responsibilities accrued, prior to the Substitution Date.
7. RELIQUEFYING BILLS
Nothing contained in this Certificate releases, relieves or otherwise
affects the obligations and responsibilities and the rights, remedies and
powers, of the Existing Financier(s) in respect of Bills drawn under
clause 8 of the Warehouse Facility Agreement. The New Financier will not
assume any obligations or responsibilities, or acquire any rights,
remedies or powers, in respect of such Bills.
<PAGE> 416
8. PAYMENTS
8.1 Consideration
The Existing Financier(s) and the New Financier shall agree separately
between themselves the amounts (if any) payable from one to the other in
relation to the substitution in respect of principal, accrued interest
and fees.
8.2 Facility Agent
On and from the Substitution Date the Facility Agent will make all
payments received by it in respect of the Substituted Commitments,
Substituted Obligations and Substituted Rights to the New Financier.
8.3 Indemnity in respect of FAI Bills
If the Substituted Commitment includes the FAI Facility and the Initial
Borrower fails to provide ABN AMRO Australia Limited with full cash cover
when the FAI Bills mature, the New Financier shall pay to ABN AMRO
Australia Limited on demand its Share (as defined in Schedule 3 of the
Warehouse Facility Agreement) of the amount payable by ABN AMRO Australia
Limited under the FAI Bills upon their maturity.
9. ACKNOWLEDGEMENTS
The New Financier acknowledges that it has received a complete and
current copy of each Transaction Document and each FAI Transaction
Document together with such other documents and information as it has
required in connection therewith.
10. GOVERNING LAW
This Certificate is governed by the laws of the Australian Capital
Territory.
SCHEDULE
<TABLE>
<CAPTION>
WAREHOUSE FACILITY FAI FACILITY
ITEM 1
<S> <C> <C>
Commitments of $[ ] $[ ]
Existing Financier(s)
prior to
Substitution
Item 2
Substituted $[ ] $[ ]
Commitments
</TABLE>
SIGNED as an agreement.
[To be executed by Existing Financier(s), the New Financier, the Initial
Borrower, OWI and the Facility Agent]
<PAGE> 417
SCHEDULE 3
SYNDICATION PROVISIONS
The provisions of this Schedule 3 apply if a Financier transfers part of its
rights and obligations under the Transaction Documents and the FAI Transaction
Documents to a New Financier in accordance with clause 18.
1. DEFINITIONS
The definitions in clause 1.1 of this Agreement apply to this Schedule
and in addition:
"Default" means an "Event of Default" as defined in either this Agreement
or the FAI Facility Agreement.
"Existing Financier" means [insert details of transferring Financier(s)]
"Facility Agent" means ABN AMRO Facilities Australia Limited as appointed
under clause 2 of this Schedule, or any replacement facility agent
appointed under clause 4.13 of this Schedule.
"FAI Security" means a "Security" as defined in the FAI Facility
Agreement.
"Majority Financiers" means Financiers having Commitments in aggregate
greater than 66% of the Total Facility Limit.
"Potential Default" means a "Potential Event of Default" as defined in
either this Agreement or the FAI Facility Agreement.
"Share" means, in respect of a New Financier, the proportion (expressed
as a percentage) which the New Financier's Commitment under the FAI
Facility bears to the FAI Facility Limit.
2. APPOINTMENT OF ABN AMRO AUSTRALIA LIMITED AS FACILITY AGENT
(a) Each Financier appoints ABN AMRO Facilities Australia Limited as
facility agent to act on behalf of the Financiers and to exercise
(subject to this Schedule) such rights, remedies, powers,
obligations and discretions as are conferred on the Financiers by
the Transaction Documents and the FAI Transaction Documents
together with such rights, remedies, powers and discretions as are
reasonably incidental thereto.
(b) The Facility Agent does not have any duties, obligations or
liabilities beyond those expressly stated in this Schedule.
<PAGE> 418
(c) In consideration of it acting as Facility Agent, the Facility
Agent shall be paid the facility agent fees referred to in the
Fees Side Letter in accordance with the Fees Side Letter. If the
appointment of the Facility Agent ends during any such year, the
Facility Agent shall not be obliged to refund any part of such fee
already paid to it in respect of that year.
(d) Each Transferring Financier shall, when it executes the
Substitution Certificate by virtue of which rights and obligations
under the Transaction Documents and FAI Transaction Documents are
transferred by it to a New Financier, pay an administration fee of
$2,000 to the Facility Agent. This does not apply to a transfer by
ABN AMRO Australia Limited and ABN AMRO Bank N.V. of their rights
and obligations under the Transaction Documents and FAI
Transaction Documents.
3. MECHANICAL PROVISIONS
3.1 Funding
(a) Each New Financier and the Existing Financier(s) shall agree
between themselves the amounts payable by the New Financier to the
Existing Financier(s) in respect of the substitution of
Commitments under the Warehouse Facility.
(b) No amount shall be payable by any New Financier to the Existing
Financier(s) in respect of the substitution of any Commitment
under the FAI Facility. Rather, the provisions of clause 3.2 of
this Schedule shall apply to any substitution of a Commitment
under the FAI Facility.
3.2 FAI Facility - Indemnity if no Cash Cover Provided for Matured FAI Bills
If a substitution of a Commitment under the FAI Facility occurs and the
Initial Borrower fails to provide ABN AMRO Australia Limited with full
cash cover when the FAI Bills mature, each New Financier shall pay to ABN
AMRO Australia Limited on demand its Share of the amount payable by ABN
AMRO Australia Limited under the FAI Bills upon their maturity.
3.3 Establishment Fees, etc
Unless the Existing Financier(s) otherwise agree(s), no New Financier
will be entitled to any fees received by the Existing Financier(s) under
clause 8 of the FAI Facility Agreement or clause 9.1 of this Agreement.
3.4 Payments by Borrowers
All payments to be made by a Borrower under the FAI Facility Agreement or
this Agreement shall be made to the Facility Agent. Each such payment
shall be sufficient to enable the Facility Agent to provide each
Financier with its respective share of such payment. Upon receipt of such
payments, the Facility Agent shall disburse them to the Financiers in
accordance with their respective entitlements.
<PAGE> 419
3.5 Communications
All communications to be made between the Borrowers and the Financiers or
any of them concerning the Warehouse Facility or the FAI Facility shall
be made by or through the Facility Agent.
3.6 Notices and Reports
(a) Wherever a Transaction Document or a FAI Transaction Document
requires a Borrower to deliver a report, notice or other document,
the Borrower shall deliver such report, notice or other document
to the Facility Agent, and shall not be required to deliver the
report, notice or other document to each Financier. The Borrower
shall provide the Facility Agent with sufficient copies of any
such report, notice or other document to enable the Facility Agent
to provide a copy to each Financier.
(b) Promptly after its receipt thereof, the Facility Agent will
provide to each Financier a copy of each report, notice or other
document delivered to it under this clause 3.6.
4. GENERAL PROVISIONS
4.1 Relationships
(a) Nothing contained in this Schedule, in clause 18 of this Agreement
or in any Substitution Certificate shall be deemed to constitute
the Financiers as a partnership, association, joint venture or
other entity.
(b) In performing its functions, the Facility Agent shall act solely
on behalf of the Financiers and will not assume and shall not be
deemed in any circumstances to have assumed any responsibility,
liability or obligation, towards, or relationship of agency or
trust with, or for, any Borrower.
4.2 Instructions
(a) Subject to paragraph (b) and clause 4.3 of this Schedule, the
Facility Agent must act or refrain from acting in the exercise of
any right or power, or as to any matter not expressly provided for
by this Schedule, in accordance with the instructions of the
Majority Financiers and shall be fully protected in so doing. Any
such instructions shall be binding on all Financiers. In the
absence of any such instructions, the Facility Agent may act or
refrain from acting as it sees fit, provided that it has used
reasonable endeavours to obtain such instructions. In no event,
however, shall the Facility Agent be required to take any action
which exposes, or is likely to expose, it to personal liability,
or which is contrary to this Schedule or to any law, regulation or
directive.
<PAGE> 420
(b) The Facility Agent may act or refrain from acting in the exercise
of any right or power without seeking the instructions of the
Majority Financiers in circumstances where such act or refrain
relates to administrative matters but not so as to involve a
waiver of any breach by any Borrower of its obligations under any
Transaction Document or any FAI Transaction Document or any
amendment to any Transaction Document or any FAI Transaction
Document.
4.3 Amendments
(a) If authorised by the Majority Financiers, the Facility Agent may
(subject to paragraph (b)) grant waivers or consents, or (with the
agreement of the Borrowers) vary the terms of any Transaction
Document or FAI Transaction Document. Any such waiver, consent or
variation so authorised and effected by the Facility Agent shall
be binding on all the Financiers and the Facility Agent shall be
under no liability whatsoever in respect of any such waiver,
consent or variation.
(b) The following may only be effected with the prior written consent
of all of the Financiers and the Borrowers:
(i) any variation of the definition of "Majority Financiers"
in this Schedule;
(ii) any extension of the date for, or alteration in the amount
or currency of, or waiver of, any payment of principal,
interest, margin, fee, commission or any other amount
payable under any Transaction Document or FAI Transaction
Document;
(iii) any variation of clauses 4.2, 4.3, 4.4, 5.1, 6.2(b),
6.3(a), 9.2. 10.2, 11 or 14 of this Agreement (and any
defined terms which are used in those clauses);
(iv) any variation of clauses 9.2, 10 or 13 of the FAI Facility
Agreement (and any defined terms which are used in those
clauses);
(v) any variation of this clause 4.3 of this Schedule;
(vi) any waiver or consent in relation to, or variation of the
material provisions of, any Security or any FAI Security;
(vii) any release of any of the Securities or FAI Securities;
(viii) any approval under clause 4.2(b) of this Agreement;
(ix) any variation of clause 2 or 3 of the OWI Guarantee; or
(x) any release pursuant to clause 2.4 of the OWI Guarantee.
4.4 No need for enquiries
The Borrowers shall not be concerned or required to enquire as to whether
the Facility Agent has been given any instructions by the Majority
Financiers or as to the terms of any instructions so given.
<PAGE> 421
4.5 Delegation
The Facility Agent may from time to time delegate the performance of its
duties and obligations under this Schedule to agents selected by it with
reasonable care.
4.6 No duty to enquire
The Facility Agent is not obliged to ascertain or enquire as to the
credit or financial condition or affairs of any Borrower, OWI or any
other person; or
(a) as to the performance or observance by any Borrower, OWI or any
other person of any of the terms of any of the Transaction
Documents or FAI Transaction Documents; or
(b) whether any Default or Potential Default has occurred.
4.7 Default
The Facility Agent shall not be obliged to make any enquiry as to whether
any Borrower is in breach of, or in default under, a Transaction Document
or an FAI Transaction Document or as to the existence of any Default or
Potential Default and shall not be deemed to have knowledge of the
occurrence of such a breach, default, Default or Potential Default unless
it has received express written notice thereof from a Financier or from a
Borrower. If the Facility Agent receives such a notice, or otherwise
acquires actual knowledge of a Default or Potential Default, it shall
promptly notify all Financiers. Subject to its being indemnified to its
satisfaction, the Facility Agent shall take such action with respect to a
Default as it shall be directed to take by the Majority Financiers. Until
the Facility Agent receives such directions it may but shall not be
obliged to take or refrain from taking such action as it shall in its
absolute discretion deem advisable in the best interests of the
Financiers.
4.8 Rights of Facility Agent
With respect to its own rights as a "Financier" under this Agreement or
the FAI Facility Agreement, the Facility Agent shall have the same rights
and powers as any other Financier and may exercise the same as though it
were not performing the duties and functions delegated to it as the
Facility Agent under this Schedule and the term "Financiers" shall
include the Facility Agent in its individual capacity as a financier.
4.9 Dealings
The Facility Agent may, without any liability to account to any
Financier, accept deposits from, lend money to and generally engage in
any kind of banking or financial, trust or other business with a Borrower
as if it was not the Facility Agent and may accept fees and other
consideration from a Borrower for services in connection with any
Transaction Document or FAI Transaction Document or otherwise without
having to account for the same to the Financiers.
<PAGE> 422
4.10 Facility Agent not responsible
(a) The Facility Agent shall not be responsible to any Financier for
failure of a Borrower to perform its obligations under a
Transaction Document or a FAI Transaction Document, a Borrower's
financial condition, or the completeness or accuracy of any
statements, representations or warranties in a Transaction
Document or FAI Transaction Document.
(b) The Facility Agent will not be liable for any cost, loss, damage
or expense suffered or incurred by a Financier or any other person
except to the extent arising as a direct result of the gross
negligence or wilful misconduct of the Facility Agent.
4.11 Indemnity, etc.
(a) Each Financier shall reimburse the Facility Agent rateably in
accordance with its Commitments on demand, for charges and
expenses incurred by the Facility Agent in connection with the
enforcement or preservation of any rights under a Transaction
Document or FAI Transaction Document or in carrying out its duties
as the Facility Agent, in each case including the fees and
expenses of legal and other professional advisers.
(b) Each Financier shall indemnify the Facility Agent rateably in
accordance with its Commitment against all liability, damage,
costs, claims and expenses suffered or incurred or made against
the Facility Agent in connection with a Transaction Document or
FAI Transaction Document, the performance or purported performance
of its duties as the Facility Agent or any action taken or omitted
to be taken by the Facility Agent under (or purportedly under) a
Transaction Document or FAI Transaction Document except to the
extent that such liability, damage, cost, claim or expense
directly results from the Facility Agent's gross negligence or
wilful misconduct.
(c) The Facility Agent shall not be liable to make a payment to any
Financier unless it has been put in sufficient cleared funds by
the Borrowers to enable it to do so. Notwithstanding this, if the
Facility Agent does make a payment to a Financier in anticipation
of receiving funds from the Borrowers, and such funds are not
received, the Financier that received the payment shall remit the
full amount of such payment to the Facility Agent on demand.
(d) Each Financier must notify the Facility Agent promptly of its
receipt other than by payment through the Facility Agent of money
payable under the Transaction Documents or FAI Transaction
Document (including by way of set-off or banker's lien). If such a
receipt represents an amount which, had it been received by the
Facility Agent, would have been distributable not only to the
Financier who received it, then the relevant Financier must pay to
the Facility Agent an amount equivalent to the amount received
within 2 Banking Days of receiving it. Such amount shall then be:
<PAGE> 423
(i) taken to have been received by the Facility Agent and not
by the Financier who received it; and
(ii) distributed by the Facility Agent to the parties entitled
to it in accordance with their entitlement.
4.12 Illegality
The Facility Agent may refrain from doing anything which would or might
in its opinion be contrary to any relevant law of any relevant
jurisdiction or will render it liable to any person and may do anything
which in its opinion is necessary to comply with any relevant law.
4.13 Removal and Retirement of Facility Agent
(a) The Facility Agent ("Retiring Facility Agent") may:
(i) resign at any time by not giving less than 20 Banking Days
written notice thereof to the Financiers and the Initial
Borrower; and
(ii) be removed from office upon not less than 20 Banking Days
prior written notice signed by or on behalf of the Majority
Financiers.
(b) Upon receipt of a notice of resignation from the Facility Agent,
or the giving of a notice of removal of the Facility Agent, the
Majority Financiers shall have the right, in consultation with the
Initial Borrower, to appoint a successor Facility Agent. In the
case only of a resignation of the Facility Agent, if within 20
Banking Days after the giving of a notice of resignation, no
successor Facility Agent has been appointed, the Retiring Facility
Agent may, in consultation with the Initial Borrower, appoint a
successor Facility Agent which shall be a reputable and
experienced financier having an office in Sydney.
(c) The resignation or removal of the Retiring Facility Agent and the
appointment of the successor Facility Agent shall both become
effective upon the successor Facility Agent notifying the
Financiers and the Initial Borrower of its acceptance of such
appointment. Upon giving such notification, the successor Facility
Agent shall succeed to and be vested with all the rights,
obligations, powers and duties and privileges of the Facility
Agent under the Transaction Documents and the FAI Transaction
Documents in place of the Retiring Facility Agent and the Retiring
Facility Agent shall be discharged from its duties and obligations
under the Transaction Documents and the FAI Transaction Documents.
<PAGE> 424
SCHEDULE 4
MORAN PROPERTIES
<TABLE>
<CAPTION>
NAME ADDRESS FOLIO IDENTIFIER
- ---- ------- ----------------
NSW
<S> <C> <C>
Annandale Nursing Home 76 Johnston Street, Auto Consol
Annandale NSW 2038 9867-46
Armon Nursing Home 42 Croydon Street, 1/110079
Petersham NSW 2049
Bathurst Nursing Home 61 Boyd Street, 11/806355
Kelso NSW 2795
Bossley Park Nursing Home 52-64 Quarry Street, 8/713734
Bossley Park NSW 2176
Canterbury District 20 Albert Street, 1/549851
Nursing Home Campsie NSW 2194
Crest Nursing Home 11 Johnston Street, 1/913045 and 1/913044
Annandale NSW 2038
Dubbo Nursing Home 80 Muller Street, 12/592842
Dubbo NSW 2830
Fernleigh Nursing Home 8 Sherbrooke Road, 4/201757 and 1/201757
West Ryde NSW 2114
Maitland Nursing Home Broughton Street, 5/733509
Rutherford NSW 2320
Mudgee Nursing Home 207-213 Denison Street, 1/261314
Mudgee NSW 2850
Murwillumbah Nursing Home Cnr North Arm Road and 1/786640
Ingram Place,
Murwillumbah NSW 2484
Narrandera Nursing Home Chantilly Street, 2/582847
Narrandera NSW 2700 308/257212
Norah Head Nursing Home 63 Palomar Parade, 721/26247 and
Toukley NSW 2263 509/26247
Quakers Hill Nursing Home 35 Hambledon Road, 10/860042
Quakers Hill NSW 2763
Shoalhaven Nursing Home Brinawarr Street, 5/614886
Bomaderry NSW 2541
Stanmore Nursing Home 66 Cambridge Street, 31/7/1
Stanmore NSW 2048
</TABLE>
<PAGE> 425
<TABLE>
<CAPTION>
NAME ADDRESS FOLIO IDENTIFIER
- ---- ------- ----------------
QUEENSLAND
<S> <C> <C>
Caloundra Nursing Home Lyon Street, Lot 2, RP 177466
Caloundra QLD 4551
Nambour Nursing Home 9 Princess Crescent, Lot 2, RP 183823
Nambour QLD 4560
WESTERN AUSTRALIA
Apple Cross Nursing Home 30 Carron Road, Vol. 1964 Fol 640
Apple Cross WA 6153
Armadale Nursing 21 Angelo Street, Vol 1951 Fol 293
Centre/Hillview Nursing Armadale WA 6112
Home
Bunbury Nursing Home 39 Hayes Street, Vol 1534 Fol 995
Bunbury WA 6230
Geraldton Nursing Home 20 Milford Street, Vol. 1539 Fol 329
Geraldton WA 6530 Vol. 1890 Fol 506
Kalgoorlie Nursing Home Dugan Street, Vol. 1597 Fol 789
Kalgoorlie WA 6430
Narrogin Nursing Home 52 Williams Road Vol. 1634 Fol 809
Narrogin WA 6312
Murray River Nursing Home Cnr Coolibah & Boundary Vol. 1697 Fol 190
Roads,
Dudley Park,
Mandurah WA 6210
</TABLE>
<PAGE> 426
SCHEDULE 5
ACCESSION AGREEMENT
ACCESSION AGREEMENT made at on
BETWEEN [INSERT NAME AND ACN OF NEW BORROWER], ("New Borrower")
AND PRINCIPAL HEALTHCARE FINANCE PTY LIMITED, ACN 069 875 476
("Initial Borrower")
AND ABN AMRO FACILITIES AUSTRALIA LIMITED ACN 001 035 543,
("Facility Agent")
RECITALS
A. The Facility Agent, the Initial Borrower and others are parties to a
Warehouse Facility Agreement dated [ ] 1998 ("Warehouse Facility
Agreement").
B. Clause 2.4 of the Warehouse Facility Agreement contemplates that a
wholly-owned Subsidiary of the Initial Borrower or a Permitted Sister
Subsidiary may become a Borrower for the purposes of the Warehouse
Facility Agreement by entering into an Accession Agreement in the form of
this Agreement
C. The New Borrower wishes to become a Borrower and is entering into this
Agreement accordingly.
THE PARTIES AGREE:
1. DEFINITIONS AND INTERPRETATIONS
In this Agreement a term which is used but not defined in this Agreement
has the meaning given to it in the Warehouse Facility Agreement, and:
"Effective Date" means the later of:
(a) the date of this Agreement; and
(b) the date on which all the requirements of paragraphs (a) to
(e) (inclusive) of clause 2.4 of the Warehouse Facility
Agreement have been satisfied in respect of the New
Borrower.
<PAGE> 427
2. JOINDER OF NEW BORROWER
With effect from the Effective Date:
(a) the expression "Borrower" when used in the Warehouse
Facility Agreement includes the New Borrower; and
(b) the New Borrower has the rights and benefits, and assumes
the obligations, of a Borrower as if the New Borrower were
a Borrower under the Warehouse Facility Agreement.
3. NO REPRESENTATION BY OR RELIANCE ON THE FINANCIERS
The New Borrower acknowledges that:
(a) it has relied upon its own enquiries as to the nature and
extent of the entire relationship between itself and the
Financiers whether or not recorded in the Transaction
Documents, and the nature and effect of the Transaction
Documents; and
(b) it has not entered into this Accession Agreement in
reliance on or as a result of any representation, promise,
statement, conduct or inducement to the New Borrower by or
on behalf of any Financier otherwise than as embodied in
this Accession Agreement.
4. GENERAL
This Agreement shall be read and construed as though clauses 1.2 and
20.18 of the Warehouse Facility Agreement were set out in full in this
Agreement.
Executed as an Agreement.
[To be executed by Facility Agent, Initial Borrower and New Borrower]
<PAGE> 428
SIGNED as an agreement.
SIGNED for and on behalf of )
PRINCIPAL HEALTHCARE FINANCE )
PTY LIMITED, ACN 069 875 476 by )
)
its Attorney under a Power of Attorney )
dated and who declares that he )
has not received any notice of the )
revocation of such Power of Attorney in ) ------------------------------
the presence of: ) (Signature)
- ---------------------------------------
(Signature of Witness)
- ---------------------------------------
(Name of Witness in Full)
SIGNED for and on behalf of )
ABN AMRO AUSTRALIA LIMITED, )
ACN 000 862 797 by )
)
its Attorney under a Power of Attorney )
dated and who declares that he )
has not received any notice of the ) ------------------------------
revocation of such Power of Attorney in ) (Signature)
the presence of:
- ---------------------------------------
(Signature of Witness)
- ---------------------------------------
(Name of Witness in Full)
<PAGE> 429
SIGNED for and on behalf of )
ABN AMRO BANK N.V., )
AUSTRALIAN BRANCH, ARBN 079 )
478 612 by )
and ) ------------------------------
its Attorneys under a Power of Attorney ) Signature
dated and who declares that he )
has not received any notice of the )
revocation of such Power of Attorneys in ) ------------------------------
the presence of: ) (Signature)
- ---------------------------------------
(Signature of Witness)
- ---------------------------------------
(Name of Witness in Full)
SIGNED for and on behalf of )
ABN AMRO FACILITIES AUSTRALIA )
LIMITED, ACN 001 035 543 by )
)
its Attorney under a Power of Attorney )
dated and who declares that he )
has not received any notice of the )
revocation of such Power of Attorney in ) ------------------------------
the presence of: ) (Signature)
- ---------------------------------------
(Signature of Witness)
- ---------------------------------------
(Name of Witness in Full)
<PAGE> 430
DEED OF GUARANTEE AND INDEMNITY made at on 1998
BETWEEN OMEGA WORLDWIDE INC., ("GUARANTOR")
AND ABN AMRO AUSTRALIA LIMITED, ACN 000 862 797 and ABN
AMRO BANK N.V., AUSTRALIAN BRANCH, ARBN 079 478 612
each of 10 Spring Street, Sydney, New South Wales (each
a "FINANCIER")
THIS DEED PROVIDES
1. DEFINITIONS AND INTERPRETATION
1.1 DEFINITIONS
In this Deed:
"ADVANCE" has the same meaning as in the Facility Agreement.
"APPROVED INVESTOR" means:
(a) an institution referred to in the Schedule; or
(b) such other institution as the Financiers may approve.
"COLLATERAL SECURITY" means any guarantee, mortgage, charge,
pledge, lien, hypothecation, indemnity, letter of credit,
performance bond or other assurance against loss which secures the
Guaranteed Money, and whether existing at the date of this Deed or
at any time in the future (and includes the Original Securities).
"DEBTOR" means Principal Healthcare Finance Pty Limited, ACN 069
875 476, both in its personal capacity and in its capacity as
trustee of the PHF Trust.
"FACILITY" has the same meaning as in the Facility Agreement.
"FACILITY AGREEMENT" means the agreement entitled "Warehouse
Facility Agreement" dated on or about the date of this Deed between
the Debtor and the Financiers.
"GUARANTEED MONEY" means all money which is now or which may
hereafter become or remain due and owing or unpaid by the Debtor to
the Financiers under or in respect of a Transaction Document or the
Facility whether actual or contingent, present or future, including
without limitation:
(a) in respect of a liability to repay any
Advance or to pay interest on any Advance;
(b) in respect of a liability to pay interest
on any overdue amount;
<PAGE> 431
(c) by reason of a Financier drawing,
accepting, paying, indorsing or discounting
any bill of exchange, order, draft, cheque,
promissory note or negotiable instrument;
(d) in respect of a liability to reimburse or
indemnify a Financier in respect of any
act, matter or thing;
(e) arising because of the assignment to a
Financier of the benefit of any liability
previously owed by the Debtor to another
person, whether actual or contingent,
present or future and whether or not the
Debtor has consented to such assignment; or
(f) in respect of liquidated or unliquidated
damages.
"NEW FINANCIER" has the same meaning as in the Facility Agreement.
"OMEGA PROPORTION" means, in respect of any amount or liability,
the proportion of that amount or liability determined in accordance
with the following formula:
OP = O
---
T
WHERE:
OP equals the Omega Proportion;
T equals the total number of Units;
O equals the total number of Units minus the number of Units which
are held by Approved Investors.
"UNIT" means a unit in the PHF Trust (or such other form of
participation in the PHF Trust as the Financiers may approve).
"ORIGINAL SECURITIES" has the same meaning as in the Facility
Agreement.
"PHF TRUST" has the same meaning as in the Facility Agreement.
"RELEVANT PERSON" means the Debtor, the Guarantor and any person
who has executed or granted a Collateral Security.
"SUBSTITUTION CERTIFICATE" has the same meaning as in the Facility
Agreement.
"TAXES" has the same meaning as in the Facility Agreement.
<PAGE> 432
"TRANSACTION DOCUMENT" has the same meaning as in the Facility
Agreement (but does not include this Deed).
1.2 INTERPRETATION
In this Deed:
(a) headings are for convenience only and do
not affect interpretation; and
unless the context indicates a contrary intention:
(b) the expression "PERSON" includes an
individual, the estate of an individual, a
body politic, a corporation and a statutory
or other authority or association
(incorporated or unincorporated);
(c) a reference to any party includes that
party's executors, administrators,
successors, substitutes and assigns,
including any person taking by way of
novation and in the case of a trustee
includes any substituted or additional
trustee;
(d) a reference to any document or agreement is
to such document or agreement as amended,
varied, novated, supplemented, ratified or
replaced from time to time;
(e) words importing the singular include the
plural (and vice versa) and words denoting
a given gender include all other genders;
(f) unless otherwise stated, a reference to
any amount is a reference to all or part
of the amount; and
(g) mentioning anything after "include",
"includes" or "including" does not limit
what else may be included.
1.3 DUAL FINANCIERS
Notwithstanding any other provision of this Deed:
(a) in this Deed a reference to the
"Financiers" is a reference to them
jointly and to each of them severally; and
(b) the rights of the Financiers under this
Deed may be exercised by either one of
them, and any such exercise of rights binds
the other Financier.
<PAGE> 433
1.4 TRANSACTION DOCUMENTS
The Guarantor acknowledges that it has, prior to its execution of
this Deed, received a copy of each Transaction Document dated on or
about the date of this Deed and is aware of the contents and effect
of each such Transaction Document.
2. GUARANTEE
2.1 GUARANTEE
The Guarantor irrevocably and unconditionally guarantees to each
Financier the payment when due of the Guaranteed Money and the
performance by the Debtor of all of its obligations under the
Transaction Documents.
2.2 PAYMENT BY GUARANTOR
If the Debtor does not pay the Guaranteed Money when due, the
Guarantor must on demand from time to time pay to the Financiers
the Guaranteed Money which is then due and payable.
2.3 AUTOMATIC REDUCTION OF GUARANTOR'S LIABILITY UPON
INTRODUCTION OF APPROVED INVESTOR
Notwithstanding any other provision of any Transaction Document, if
an Approved Investor acquires one or more Units, the liability of
the Guarantor under this Deed shall be automatically reduced to the
Omega Proportion such that, as from the date of such acquisition:
(a) the Guarantor shall only be liable under
clauses 2.1, 2.2 and 3 for the
Omega Proportion of the Guaranteed Money;
and
(b) the Guarantor shall only be liable under
clause 2.1 (in respect of the performance
by the Debtor of its obligations under the
Transaction Documents) and clause 3 such
that it will only be obliged to pay the
Omega Proportion of its prima facie payment
obligation under those clauses.
2.4 RELEASE OF GUARANTOR
If at any time Approved Investors hold at least 25% of the Units,
the Financiers, if requested to do so by the Guarantor, will
consider in good faith releasing the Guarantor from all of its
obligations under this Deed. If at any time Approved Investors hold
at least 40% of the Units, then the Financiers will not
unreasonably withhold their consent to such a release.
<PAGE> 434
3. INDEMNITY
As a covenant separate and distinct from that contained in clause
2.1, the Guarantor irrevocably and unconditionally agrees to
indemnify each Financier and at all times to keep each Financier
indemnified against any loss or damage suffered by that Financier
arising out of:
(a) any failure by the Debtor to pay the
Guaranteed Money duly and punctually; or
(b) any failure by the Debtor to observe or
perform any of its obligations under any
Transaction Document; or
(c) any Transaction Document being wholly or
partly void, voidable or unenforceable
against the Debtor for any reason and
whether or not the Financiers knew or ought
to have known of that reason, with the
result, in any such case, that sums which
would (but for the voidness, voidability,
or unenforceability) have been Guaranteed
Money are not recoverable by the Financiers
under clause 2.
4. NATURE AND PRESERVATION OF LIABILITY
4.1 ABSOLUTE LIABILITY
The liability of the Guarantor under this Deed arises immediately
on execution and delivery of this Deed by the Guarantor, and:
(a) arises notwithstanding that any person
expressed to be a party to this Deed does
not execute and deliver this Deed, that
there is any invalidity, forgery or
irregularity in the execution or purported
execution of this Deed by any person, or
that this Deed is or becomes unenforceable
against any such person for any reason; and
(b) is not conditional on the entering into by
any other person of any other document or
agreement which might benefit (directly or
indirectly) the Guarantor, or on the
satisfaction of any other condition.
4.2 UNCONDITIONAL LIABILITY
The liability of the Guarantor under this Deed will not be affected
by any thing which, but for this clause 4.2, would release the
Guarantor from or reduce that liability, including but not limited
to:
(a) (INVALIDITY ETC.): any Transaction Document
being terminated or discharged (whether by
any party thereto or by operation of law)
or being or becoming void, voidable or
unenforceable for any reason;
<PAGE> 435
(b) (OTHER COLLATERAL SECURITIES): a Financier
accepting or declining to accept any
Collateral Security from any person;
(c) (TIME OR INDULGENCE): a Financier granting
or agreeing with the Guarantor or the
Debtor to grant time, waiver or other
indulgence or concession to, or making any
composition or compromise with, any person;
(d) (FORBEARANCE): a Financier not exercising
or delaying in the exercise of any remedy
or right it has at any time to terminate or
enforce its rights under this Deed, any
other Transaction Document or any other
document;
(e) (VARIATION): any variation, novation or
alteration to or substitution of this Deed,
any other Transaction Document any
Collateral Security or any other document,
whether or not that variation, novation or
alteration permits or results in a change
in the amount of the Guaranteed Money or a
change in the date by which it must be
paid;
(f) (RELEASE):the full, partial or conditional
release or discharge by a Financier or by
operation of law of the Debtor or any other
person from its obligations under any
Transaction Document or any Collateral
Security;
(g) (COLLATERAL SECURITIES): a Financier
enforcing, releasing, disposing of,
surrendering, wasting, impairing,
destroying, abandoning, prejudicing, or
failing or delaying to perfect, maintain,
preserve, realise or enforce any Collateral
Security, whether negligently or otherwise;
(h) (ACCOUNTS): the opening or operation of any
new account with a Financier by any
Relevant Person;
(i) (CHANGE OF CONSTITUTION): any change for
any reason in the name or manner in which a
Financier or any Relevant Person carries on
business, including any change in any
partnership, firm or association of which a
Financier or any Relevant Person is a
member;
(j) (CHANGE IN OWNERSHIP): any change in
ownership or control of the Debtor, the
Guarantor or any other person;
(k) (DISCLOSURE): any failure by a Financier to
disclose to the Guarantor any material or
unusual fact, circumstance, event or thing
known by, or which ought to have been known
by, the Financier relating to or affecting
any Relevant Person or any other matter or
thing before or at any time after the date
of this Deed;
<PAGE> 436
(l) (PREJUDICIAL CONDUCT): any breach by a
Financier of any term of any Transaction
Document or any other document or any other
act or omission (negligent or otherwise) of
a Financier with regard to any Transaction
Document or any other document which is
prejudicial to the interests of the
Guarantor;
(m) (PREFERENCE): any claim by any person that
a payment to, receipt by, or other
transaction in favour of a Financier in or
towards satisfaction of the Guaranteed
Money is void, voidable or capable of being
set aside under any law relating to
bankruptcy, insolvency or liquidation being
upheld, conceded or compromised;
(n) (ASSIGNMENT): the transfer, assignment or
novation by a Financier of all or any of
its rights or obligations under any
Transaction Document, or the Financier
mortgaging, charging or otherwise
encumbering its rights under any
Transaction Document or any other document;
or
(o) (ADMINISTRATION): the provisions of section
440J of the Corporations Law operating to
prevent or delay:
(i) the enforcement of this Deed against
the Guarantor; or
(ii) any claim for contribution against
the Guarantor.
4.3 NO MARSHALLING
The Financiers are under no obligation to marshal or appropriate in
favour of the Guarantor or to exercise, apply, transfer or recover
in favour of any Guarantor, any Collateral Security or any funds or
assets that the Financiers hold, have a claim on, or are entitled
to receive.
4.4 VOID OR VOIDABLE TRANSACTIONS
If:
(a) a Financier has at any time released or
discharged:
(i) the Guarantor from its
obligations under this Deed or any
collateral Security executed by the
Guarantor; or
(ii) any assets of the Guarantor from a
Collateral Security,
in either case in reliance on a payment, receipt or
other transaction to or in favour of the Financier;
(b) that payment, receipt or other transaction
is subsequently claimed by any person to be
void, voidable or capable of being set
aside for any
<PAGE> 437
reason, including under a law relating to
bankruptcy, insolvency or liquidation; and
(c) that claim is upheld, conceded or
compromised,
then
(d) (RESTITUTION OF RIGHTS): the Financier will
immediately become entitled against the
Guarantor to all such rights (including
under any Collateral Security) as it had
immediately before that release or
discharge;
(e) (RESTORE FINANCIER'S POSITION): the
Guarantor must immediately do all things
and execute all documents as the Financier
may reasonably require to restore the
Financier all those rights; and
(f) (INDEMNITY): the Guarantor must indemnify
and keep indemnified the Financier against
costs, losses and expenses suffered or
incurred by the Financier as a result of
the upholding, concession or compromise of
the claim.
4.5 NO DOUBLE PROOF
This Deed constitutes a guarantee of the whole of the Guaranteed
Money, even if the Financiers and the Guarantor have agreed or
agree at any time that the Guarantor's liability under this Deed
will be limited to a maximum amount. Accordingly, the Guarantor is
not entitled to:
(a) lodge any proof of debt in the winding up
of the Debtor;
(b) exercise any right of subrogation; or
(c) otherwise be entitled to the benefit of
any Collateral Security held by a
Financier,
unless and until the Guaranteed Money has been paid, discharged or
recovered by the Financiers in full.
4.6 SUSPENSE ACCOUNT
A Financier may retain and carry to a suspense account and
appropriate at the discretion of the Financier any dividend
received by the Financier in the winding-up of any Relevant Person,
plus any other sums received by the Financier on account of the
Guaranteed Money, until the Financiers have received the full
amount of the Guaranteed Money.
<PAGE> 438
4.7 PROOF OF DEBT IN COMPETITION WITH FINANCIER
The Guarantor must prove in the winding-up of any Relevant Person
in respect of any claim it has against that Relevant Person other
than a claim arising as a result of the Guarantor making a payment
under this Deed, and agrees to hold any dividend received in
respect of that proof on trust for the Financiers in or towards
satisfaction of the Guarantor's obligations under this Deed. The
Guarantor appoints each Financier its attorney for the purposes of
lodging a proof in the Guarantor's name, and authorises each
Financier to retain and to carry to a suspense account and
appropriate at the discretion of the Financier any amounts received
in respect of that proof until, after taking the amount into
account, the Financiers have recovered an amount equal to all of
the Guaranteed Money.
4.8 NO SET-OFF, COUNTERCLAIM, ETC.
The liability of the Guarantor under this Deed will not be reduced
or avoided by any defence, set-off or counterclaim available to any
other Relevant Person against a Financier.
4.9 CLAIM ON THE GUARANTOR
The Financiers are not required to take any steps to enforce their
rights under any Transaction Document or Collateral Security before
enforcing their rights against the Guarantor under this Deed.
4.10 NO REPRESENTATION BY FINANCIER
The Guarantor acknowledges that in entering into this Deed it has
not relied on any representation, warranty or statement by the
Financiers.
4.11 NO CONTRIBUTION
The Guarantor must not make a claim under or enforce any right of
contribution it may have against any other Relevant Person unless
and until the Guaranteed Money has been paid, discharged or
recovered by the Financiers in full.
5. CORPORATE REPRESENTATIONS AND WARRANTIES
The Guarantor represents and warrants to each Financier that:
(a) (CONSTITUTION): the execution, delivery
and performance of this Deed does not
violate its constitution or any other
document, agreement, law or rules by which
it is bound;
(b) (CORPORATE POWER): it has taken all action
required to enter into this Deed and to
authorise the execution and delivery of
this Deed and the performance of its
obligations under this Deed;
<PAGE> 439
(c) (VALID AND BINDING): this deed is valid and
binding and enforceable against the
Guarantor in accordance with its terms;
(d) (CORPORATE BENEFIT): the execution of this
Deed is in the best commercial interests of
the Guarantor; and
(e) (CONSIDERATION): this Deed is executed for
valuable consideration, the receipt and
adequacy of which the Guarantor
acknowledges.
6. PAYMENTS
6.1 ON DEMAND
All money payable by the Guarantor under this Deed must be paid on
demand by the Financier in immediately available funds to the
account and in the manner notified from time to time by the
Financiers to the Guarantor.
6.2 PAYMENT IN GROSS
All money received or recovered by the Financiers on account of the
Guaranteed Money will be treated as payments in gross.
6.3 APPROPRIATION OF PAYMENTS
The Financiers may appropriate any money received by them under or
in respect of this Deed, any other Transaction Document or any
Collateral Security in the manner and order and at all times as the
Financiers in their absolute discretion determine.
6.4 INTEREST
The Guarantor must on demand by the Financiers from time to time
pay interest on all amounts due and payable by it and unpaid under
or in respect of this Deed. Interest will accrue on those amounts
from day to day from the due date up to the date of actual payment,
before and (as a separate and independent obligation) after
judgment, at such rate as is notified by the Financiers to the
Guarantor as being its cost of funds in respect of those amounts
and, if not paid when due, will itself bear interest in accordance
with this clause 6.4.
6.5 MERGER
If the liability of the Guarantor to pay to the Financiers any
money under this Deed becomes merged in any judgment or order, then
as an independent obligation the Guarantor must pay interest on the
amount of that money at the rate which is the higher of that
payable under clause 6.4 and that fixed by or payable under the
judgment or order.
<PAGE> 440
6.6 NO SET-OFF OR DEDUCTION
All payments by the Guarantor under this Deed will be free of any
set-off or counterclaim and without deduction or withholding for
any present or future Taxes unless the Guarantor is compelled by
law to make any deduction or withholding and if this is the case,
the Guarantor must pay to the Financiers any additional amounts as
are necessary to enable the Financiers to receive, after all those
deductions and withholdings, a net amount equal to the full amount
which would otherwise have been payable had no deduction or
withholding been required to be made.
7. EXPENSES AND STAMP DUTY
7.1 EXPENSES
The Guarantor must on demand indemnify and keep each Financier
indemnified against all expenses, including legal fees, costs and
disbursements on a solicitor/own client basis, incurred by the
Financier in connection with:
(a) (PREPARATION): the negotiation,
preparation and execution of this Deed and
any subsequent consent, agreement, approval
or waiver hereunder or amendment to it; and
(b) (ENFORCEMENT): the enforcement, attempted
enforcement or preservation of any rights
under this Deed.
7.2 STAMP DUTIES
The Guarantor must:
(a) (PAYMENT OF ALL DUTIES): pay all stamp
duties, registration and similar Taxes,
including fines and penalties, financial
institutions duty and debits tax in
connection with the execution, delivery,
performance, enforcement, or attempted
enforcement of this Deed or any payment or
other transaction under or contemplated in
this Deed; and
(b) (INDEMNITY): indemnify and keep indemnified
each Financier against any loss or
liability incurred or suffered by it as a
result of the delay or failure by the
Guarantor to pay Taxes.
8. ASSIGNMENTS
8.1 ASSIGNMENT
The Financiers may at any time assign, mortgage, charge or
otherwise transfer or deal with all or any part of their respective
rights under this Deed and may disclose to a proposed assignee or
transferee any information in the possession of the Financiers
relating to the Guarantor.
<PAGE> 441
8.2 SYNDICATION
(a) The Guarantor acknowledges that a
Financier (as defined in the Facility
Agreement) may transfer part of its rights
and obligations under the Transaction
Documents (including this Deed) to another
bank or financial institution pursuant to
clause 18 of the Facility Agreement, and
agrees that if this occurs the New
Financier shall, with effect from the
"Substitution Date" specified in the
relevant Substitution Certificate, be
bound by the Transaction Documents
(including this Deed) to the extent stated
in the Substitution Certificate, and the
Guarantor shall be bound to the New
Financier accordingly.
(b) The execution by the Guarantor of this Deed
shall constitute an offer to all New
Financiers of the matters set out in
paragraph (a), which may be accepted by a
New Financier executing a Substitution
Certificate.
9. GOVERNING LAW AND JURISDICTION
9.1 GOVERNING LAW
This Deed is governed by and will be construed in accordance with
the laws of New South Wales.
9.2 JURISDICTION
(a) (ACCEPTANCE OF JURISDICTION): The Guarantor
irrevocably submits to and accepts,
generally and unconditionally, the
non-exclusive jurisdiction of the courts
and appellate courts of New South Wales
with respect to any legal action or
proceedings which may be brought at any
time relating in any way to this Deed.
(b) (NO OBJECTION TO INCONVENIENT FORUM): The
Guarantor irrevocably waives any objection
it may now or in the future have to the
venue of any action or proceeding, and any
claim it may now or in the future have that
any action or proceeding has been brought
in an inconvenient forum.
10. MISCELLANEOUS
10.1 CERTIFICATE OF FINANCIER
A certificate in writing of a Financier certifying the amount
payable by the Debtor or the Guarantor to the Financier or stating
any other act, matter or thing relating to this Deed, any
Transaction Document or any Collateral Security will be conclusive
and binding on the Guarantor in the absence of manifest error on
the face of the certificate.
<PAGE> 442
10.2 NOTICES
Every notice or other communication to be given or made under or
arising from this Deed:
(a) must be in writing;
(b) must be signed by a person duly authorised
to do so by the sender;
(c) will be deemed to have been duly given or
made to a person if delivered or posted by
prepaid post to the address, or sent by fax
to the fax number of that person set out in
clause 10.3 (or to any other address or fax
number as is notified in writing by that
person to the other parties from time to
time); and
(d) will be deemed to be given or made:
(i) (in the case of prepaid post)
on the fifth day after the
date of posting;
(ii) (in the case of delivery by
hand) on delivery;
(iii) (in the case of fax) on
receipt of a transmission
report confirming successful
transmission.
10.3 ADDRESS FOR NOTICES
The addresses and fax numbers of the parties are:
THE GUARANTOR
Address: 900 Victors Way
Suite 345
Ann Arbor
Michigan 48108
Fax No.: 0011 1 734 887 0301
THE FINANCIERS
Address: 10 Spring Street
Sydney NSW 2000
Fax No.: (02) 9321 2139
Attention: Manager, Loans Administration
10.4 CONTINUING OBLIGATION
This Deed will be a continuing obligation notwithstanding any
termination by the Guarantor, settlement of account, intervening
payment, express or implied revocation or any other matter or
thing, and continues to entitle the Financiers to the due and
punctual
<PAGE> 443
payment of any of Guaranteed Money which becomes due or owing or is
incurred after termination, settlement of account, payment,
revocation or other matter or thing until a final discharge has
been given to the Guarantor.
10.5 FURTHER ASSURANCE
The Guarantor will immediately on demand by the Financiers and at
the entire cost and expense of the Guarantor, perform all things
and execute all agreements, assurances and other documents as the
Financiers reasonably require, to perfect or give effect to the
rights and powers of the Financiers created, or intended to be
created, by this Deed.
10.6 FORM OF DEMAND
A demand on the Guarantor for payment under this Deed may be in the
form and contain any information as the Financiers determine. It
need not specify the amount of the Guaranteed Money, nor the method
or basis of calculation of all or any part of the Guaranteed Money,
including without limitation amounts of, or in the nature of
interest.
10.7 SEVERABILITY OF PROVISIONS
Any provision of this Deed which is illegal, void or unenforceable
will be ineffective to the extent only of that illegality, voidness
or unenforceability without invalidating the remaining provisions.
10.8 REMEDIES CUMULATIVE
The rights and remedies conferred by this Deed on the Financiers
are cumulative and in addition to all other rights or remedies
available to the Financiers by law or by virtue of any Transaction
Document or Collateral Security.
10.9 WAIVER
A failure to exercise or enforce, or a delay in exercising or
enforcing, or the partial exercise or enforcement of any right,
remedy, power or privilege under this Deed by a Financier will not
in any way preclude or operate as a waiver of any further exercise
or enforcement of it, or the exercise or enforcement of any other
right, remedy, power or privilege under this Deed or provided by
law.
10.10 CONSENTS AND APPROVALS
Where under this Deed the consent or approval of the Financiers is
required to any act or thing, then unless expressly provided
otherwise in this Deed, that consent or approval may be given or
withheld in the absolute and unfettered discretion of the
Financiers.
<PAGE> 444
10.11 WRITTEN WAIVER, CONSENT AND APPROVAL
Any waiver, consent or approval given by the Financiers under this
Deed will only be effective and will only bind the Financiers if it
is given in writing, or given verbally and subsequently confirmed
by the Financiers in writing.
10.12 MORATORIUM LEGISLATION
To the fullest extent permitted by law, the provisions of all
legislation whether existing now or in the future, operating
directly or indirectly:
(a) to lessen or otherwise to vary or affect
in favour of the Guarantor any obligation
under this Deed; or
(b) to delay or otherwise prevent or
prejudicially affect the exercise of any
rights or remedies conferred on the
Financiers under this Deed,
are expressly waived and excluded.
10.13 DEBIT ACCOUNTS AND SET-OFF
A Financier may without prior notice to the Guarantor set-off any
amount which or may become owing, actually or contingently and on
any account whatsoever by the Financier to the Guarantor against
any liability actual or contingent of the Guarantor to the
Financier under this Deed. The rights of the Financiers under this
clause 10.13 are without prejudice and in addition to any other
right or remedy to which it is at any time entitled.
10.14 COUNTERPARTS
This Deed may be executed in any number of counterparts and by the
different parties on different counterparts, each of which
constitutes an original of this Deed, and all of which together
constitute one and the same instrument.
EXECUTED as a deed.
<PAGE> 445
SCHEDULE
APPROVED FINANCIAL INSTITUTIONS
- - AMP Ltd
- - MLC Ltd (Lend Lease Group)
- - GIO Australia Ltd
- - Legal & General Life of Australia Ltd
- - Mercantile Mutual Life Insurance Ltd
- - National Mutual Life Association Ltd
- - NRMA Life Ltd
- - Prudential Assurance Co Ltd
- - Colonial Group Ltd
- - Australia Post Superannuation Scheme
- - Commonwealth Bank Officers Superannuation Fund
- - Public Sector Superannuation Scheme
- - Local Authority Superannuation Board
- - C+Bus
- - HEST Australia Limited
- - Retail Employees Superannuation Trust
- - Superannuation Trust of Australia
- - TWU Superannuation Fund
Or any subsidiary or related body corporate of any of the above institutions,
provided that such subsidiary or related body corporate is approved by the
Financiers in writing.
<PAGE> 446
SIGNED SEALED AND DELIVERED )
for and on behalf of )
OMEGA WORLDWIDE, INC. by ) .........................
its Attorney under a ) (Signature)
Power of Attorney dated and )
who declares that he has not received any )
notice of the revocation of such Power of )
Attorney in the presence of: )
...............................................
(Signature of Witness)
...............................................
(Name of Witness in Full)
SIGNED SEALED AND DELIVERED ) ........................
for and on behalf of ABN AMRO ) (Signature)
AUSTRALIA LIMITED, ACN 000 862 )
797 by its Attorney under )
a Power of Attorney dated )
and who declares that he has not received )
any notice of the revocation of such Power )
of Attorney in the presence of: )
.....................................................
(Signature of Witness)
.....................................................
(Name of Witness in Full)
<PAGE> 447
SIGNED SEALED AND DELIVERED )
for and on behalf of ABN AMRO BANK ) ...........................
N.V., AUSTRALIAN BRANCH, ARBN ) (Signature)
079 478 612 by
)
and its Attorneys under a )
Power of Attorney dated and )
who declare that they have not received any )
notice of the revocation of such Power of )
Attorney in the presence of:
.....................................................
(Signature of Witness)
.....................................................
(Name of Witness in Full)
<PAGE> 448
<TABLE>
<CAPTION>
TABLE OF CONTENTS
CLAUSE
PAGE
<S> <C> <C>
1. DEFINITIONS AND INTERPRETATION 1
1.1 DEFINITIONS 1
1.2 INTERPRETATION 2
1.3 DUAL FINANCIERS 3
1.4 TRANSACTION DOCUMENTS 3
2. GUARANTEE 3
2.1 GUARANTEE 3
2.2 PAYMENT BY GUARANTOR 3
2.3 AUTOMATIC REDUCTION OF GUARANTOR'S LIABILITY UPON INTRODUCTION OF
APPROVED INVESTOR 4
2.4 RELEASE OF GUARANTOR 4
3. INDEMNITY 4
4. NATURE AND PRESERVATION OF LIABILITY 4
4.1 ABSOLUTE LIABILITY 4
4.2 UNCONDITIONAL LIABILITY 5
4.3 NO MARSHALLING 6
4.4 VOID OR VOIDABLE TRANSACTIONS 6
4.5 NO DOUBLE PROOF 7
4.6 SUSPENSE ACCOUNT 7
4.7 PROOF OF DEBT IN COMPETITION WITH FINANCIER 7
4.8 NO SET-OFF, COUNTERCLAIM, ETC. 8
4.9 CLAIM ON THE GUARANTOR 8
4.10 NO REPRESENTATION BY FINANCIER 8
4.11 NO CONTRIBUTION 8
5. CORPORATE REPRESENTATIONS AND WARRANTIES 8
6. PAYMENTS 9
6.1 ON DEMAND 9
6.2 PAYMENT IN GROSS 9
6.3 APPROPRIATION OF PAYMENTS 9
6.4 INTEREST 9
6.5 MERGER 9
6.6 NO SET-OFF OR DEDUCTION 9
7. EXPENSES AND STAMP DUTY 10
</TABLE>
<PAGE> 449
<TABLE>
<CAPTION>
TABLE OF CONTENTS
CLAUSE PAGE
<S> <C> <C>
7.1 EXPENSES 10
7.2 STAMP DUTIES 10
8. ASSIGNMENTS 10
8.1 ASSIGNMENT 10
8.2 SYNDICATION 10
9. GOVERNING LAW AND JURISDICTION 11
9.1 GOVERNING LAW 11
9.2 JURISDICTION 11
10. MISCELLANEOUS 11
10.1 CERTIFICATE OF FINANCIER 11
10.2 NOTICES 11
10.3 ADDRESS FOR NOTICES 12
10.4 CONTINUING OBLIGATION 12
10.5 FURTHER ASSURANCE 12
10.6 FORM OF DEMAND 12
10.7 SEVERABILITY OF PROVISIONS 12
10.8 REMEDIES CUMULATIVE 13
10.9 WAIVER 13
10.10 CONSENTS AND APPROVALS 13
10.11 WRITTEN WAIVER, CONSENT AND APPROVAL 13
10.12 MORATORIUM LEGISLATION 13
10.13 DEBIT ACCOUNTS AND SET-OFF 13
10.14 COUNTERPARTS 14
</TABLE>
<PAGE> 450
DEED OF GUARANTEE AND INDEMNITY
DATE:
OMEGA WORLDWIDE, INC.
Guarantor
ABN AMRO AUSTRALIA LIMITED
and
ABN AMRO BANK N.V., AUSTRALIAN BRANCH
each a Financier
(C) Copyright Clayton Utz
Liability is limited by the Solicitors Scheme under the Professional
Standards Act 1994 NSW
<PAGE> 451
DEBENTURE STOCK TRUST DEED made at Canberra on 1998
BETWEEN PRINCIPAL HEALTHCARE FINANCE PTY LIMITED, ACN 069 875 476
both in its personal capacity and in its capacity as trustee of
the PHF Trust ("COMPANY")
AND ABN AMRO FACILITIES AUSTRALIA LIMITED, ACN 001 035 543
("SECURITY TRUSTEE")
RECITALS
A. The Company has executed this Deed to enable it to raise money and
to secure its obligations by the issue of first ranking debenture
stock by the Company.
B. The Security Trustee has at the request of the Company agreed to
act as Security Trustee under this Deed for the holders of that
debenture stock from time to time.
C. The Company executes this Deed to protect the interest of the
holders of such debenture stock.
THIS DEED PROVIDES
1. DEFINITIONS AND INTERPRETATION
1.1 DEFINITIONS
In this Deed:
"APPROVED AGED CARE ASSETS" means healthcare or healthcare related
facilities (including aged care facilities, nursing and/or
residential care facilities for the aged, mentally infirm, the
chronically ill, the learning or physically disabled, hospitals,
medical surgeries) or entities owning such facilities, that the
Company proposes to acquire (or which have been acquired, as the
context requires) from any person (but excluding the FAI Property
and the Moran Property);
"ASSOCIATED RIGHTS" means, in relation to any property:
(a) all rights, powers and remedies of the Company for the
enforcement of such property; and
(b) all rights and powers of the Company to vary,
repudiate, rescind, avoid, waive any right under, or
terminate any agreement or arrangement relating to such
property.
"BANKING DAY" means a day (other than a Saturday or Sunday) on
which trading banks are open for business generally in Sydney.
1.
<PAGE> 452
"BUSINESS" means the business conducted by the Company in
connection with the Approved Aged Care Assets, including the
acquisition or leasing of the Approved Aged Care Assets.
"CHARGE" means the charge granted by the Company under this Deed.
"CHARGED PROPERTY" means all of the Chargor's assets, undertaking
and rights, both present and future, including without limiting the
generality of the foregoing, the Approved Aged Care Assets any
Lease Guarantee and any Lease, but excluding:
(a) the FAI Property;
(b) the Moran Property; and
(c) any assets which are released from this Charge
pursuant to clause 2A.
"COLLATERAL SECURITY" means each guarantee, indemnity, contract of
suretyship or Encumbrance (other than the Charge) at any time held
by the Security Trustee whether during the currency of the Charge
or otherwise, for the performance of the whole or any part of the
Obligations.
"CONTROLLER" has the meaning given in section 9 of the Corporations
Law.
"DOLLAR" or "$" means the lawful currency for the time being of
the Commonwealth of Australia.
"ENCUMBRANCE" means any mortgage, charge, pledge, lien,
encumbrance, assignment, hypothecation, security interest, title
retention, preferential right, trust arrangement, contractual right
of set-off, or any other security agreement or arrangement in
favour of any person.
"EVENT OF CRYSTALLISATION" means each or any of the following
events:
(a) any breach of clause 7.1;
(b) any Encumbrance over any asset of the
Company becomes enforceable or any
Encumbrance that is a floating security
over any asset of the Company crystallises
or otherwise becomes a fixed or specific
security;
(c) any Insolvency Event occurs in relation to
the Company;
(d) the Commissioner of Taxation, or its
delegate, determines to issue a notice
under section 74 of the Sales Tax
Assessment Act 1992 or section 218 of the
Income Tax Assessment Act 1936 for any
amount due by the Company in respect of any
Tax under such Act or any fines and costs
imposed on the Company under such Act; and
2.
<PAGE> 453
(e) any other event that the Security Trustee
has notified the Company to be an Event of
Crystallisation for the purposes of the
Charge.
"EVENT OF DEFAULT" means an act, matter or event which is defined
as an "Event of Default" in any Transaction Document or which is
specifically agreed in any Transaction Document to be an Event of
Default.
"EXTRAORDINARY RESOLUTION" means:
(a) a resolution in writing under clause 12 of the Meetings
Procedures signed by all Stockholders; or
(b) a resolution adopted at a meeting of the Stockholders
(or the relevant class of Stockholders as the case may
be) duly convened and held in accordance with clause 20
and the Meetings Procedures by a majority consisting of
not less than 66% of the votes cast in respect of such
resolution,
or where there is only one Stockholder a resolution in writing
signed by that Stockholder.
"FACE AMOUNT" means, when used in relation to the Stock, the face
value of and the amount subscribed for that Stock being the amount
set out and so described on the face of the relevant Stock
Certificate.
"FAI PROPERTY" means the charged property referred to in the
Original Debenture Stock Trust Deed.
"FINANCE LEASE" means any lease or other arrangement (whether in
respect of land, plant and equipment, machinery, Intellectual
Property or otherwise) entered into primarily as a means of
financing or refinancing the acquisition of the asset or property
and which must be accounted for as a finance lease under Approved
Accounting Standard ASRB 1008: Accounting for Leases or under any
other applicable approved accounting standard (but does not include
any lease or other arrangement which may be accounted for as an
operating lease under Approved Accounting Standard ASRB 1008:
Accounting for Leases or under any other applicable approved
accounting standard).
"FINANCIAL ACCOMMODATION" means the funds, financial accommodation
(including, without limitation, Guarantees) or credit which a
Stockholder (or a person who reasonably expects to become a
Stockholder) provides or agrees to provide to or for the
accommodation of, or at the direction of the Company on the
security of this Deed, any money borrowed or raised or credit or
accommodation obtained by the Company, including by way of loans,
discount or acceptance facilities or the issue of Guarantees.
"FINANCIAL LIABILITY" means any present or future, actual or
contingent indebtedness in respect of any Financial Accommodation,
credit arrangements, Treasury Transaction, Finance Lease or hire
purchase arrangement or any Guarantee given in respect of any such
indebtedness.
3.
<PAGE> 454
"GOVERNMENT AUTHORITY" means any government or any governmental or
semi- governmental entity, authority, agency, commission,
corporation or body (including, without limitation, those
constituted or formed under any Statute).
"GUARANTEE" means any guarantee, bond, letter of credit or
suretyship or any other obligation (whatever called and of whatever
nature) to pay, purchase or provide funds (whether by the advance
of money, the purchase of or subscription for shares or other
securities, the purchase of assets or services, or otherwise) for
the payment or discharge of, indemnify against the consequences of
default in the payment of, or otherwise be responsible for, any
indebtedness of or the insolvency of any other person.
"INITIAL STOCK" means Stock to be issued within 1 week of the date
of this Deed to such of the following persons who subscribe for
stock in the Face Amounts referred to below:
<TABLE>
<CAPTION>
NAME FACE AMOUNT
<S> <C>
ABN AMRO Australia Limited $100
ABN AMRO Bank N.V. $100
</TABLE>
"INITIAL STOCKHOLDER" means each of ABN AMRO Australia Limited, ACN
000 862 797 and ABN AMRO BANK N.V.
"INSOLVENCY EVENT " means:
(a) a receiver, manager, receiver and manager,
trustee, administrator, Controller or
similar officer is appointed in respect of
a person or any asset of a person (and does
not retire, or is not removed, within 3
Banking Days of such appointment);
(b) a liquidator or provisional liquidator is
appointed in respect of a corporation;
(c) any application (not being an application
withdrawn, stayed or dismissed within 10
days) is made to a court for an order, or
an order is made, or a meeting is convened,
or a resolution is passed, for the purpose
of:
(i) appointing a person referred to in
paragraphs (a) or (b);
(ii) winding up a corporation; or
(iii) proposing or implementing a scheme
of arrangement;
(d) a moratorium of any debts of a person or an
official assignment or a composition or an
arrangement (formal or informal) with a
person's creditors or any similar
proceeding or arrangement by which the
assets of a person are subjected
conditionally or unconditionally to the
control of that person's creditors or a
trustee, is ordered, declared, or agreed
to, or is applied for and the application
is not withdrawn,
4.
<PAGE> 455
stayed or dismissed within 10 days;
(e) a person becomes, or admits in writing that
it is, is declared to be, or is deemed
under any applicable law to be, insolvent
or unable to pay its debts; or
(f) any writ of execution, garnishee order,
mareva injunction or similar order,
attachment, distress or other process is
made, levied or issued against or in
relation to any asset of a person for any
amount exceeding $100,000.
"INSOLVENCY PROVISION" means any law relating to insolvency,
sequestration, liquidation or bankruptcy (including any law
relating to the avoidance of conveyances in fraud of creditors or
of preferences, and any law under which a liquidator or trustee in
bankruptcy may set aside or avoid transactions), and any provision
of any agreement, arrangement or scheme, formal or informal,
relating to the administration of any of the assets of any person.
"INTELLECTUAL PROPERTY" means all patents, trademarks, copyrights,
registered designs, trade secrets, confidential information and
other intellectual property at any time held by or registered in
the name of the Company or which the Company at any time has the
benefit of, has an interest in or is entitled to use.
"LEASE" means all of the present and future right, title and
interest of the Company in:
(a) any lease entered into by the Company with any person
in respect of any Approved Aged Care Assets (as
amended, varied, novated, supplemented, notified or
replaced from time to time); and
(b) all Associated Rights in relation to and all proceeds
deriving from the property referred to in paragraph
(a),
but does not include any part of the FAI Property or the Moran
Property.
"LEASE GUARANTEE" means all of the present and future right, title
and interest of the Company in:
(a) any guarantee and/or indemnity provided by any person
in respect of the obligations of any lessee under a
Lease; and
(b) all Associated Rights in relation to and all proceeds
deriving from the property referred to in paragraph
(a),
but does not include any part the FAI Property or the Moran
Property.
"LICENCE" means each licence, certificate, document, registration,
permission, privilege, permit, authority or consent which is issued
or held in connection with the Business, or
5.
<PAGE> 456
which is necessary or desirable to be held by the Company in
relation to the Business including any variation or renewal
thereof.
"MARKETABLE SECURITIES" has the meaning given in section 9 of the
Corporations Law.
"MEETINGS PROCEDURES" means the procedures and other provisions
contained in Schedule 1.
"MORAN PROPERTY" means the charged property referred to in each of
the Deed of Charge (WA), the Deed of Charge (Qld) and the Deed of
Charge (NSW and Vic) all of which are between the Company and the
Security Trustee and are dated on or about the date of this Deed.
"OBLIGATIONS" means all the liabilities and obligations of the
Company to any Stockholder or to the Security Trustee (as trustee
for the Stockholders) under or by reason of any Transaction
Document and includes any liabilities or obligations which:
(a) are liquidated or unliquidated;
(b) are present, prospective or contingent;
(c) are in existence before or come into
existence upon or after the date of this
Deed;
(d) relate to the payment of money or the
performance or omission of any act;
(e) sound in damages only; or
(f) accrue as a result of any Event of Default,
and irrespective of:
(g) whether the Company is liable or obligated
solely, or jointly or jointly and severally
with another person;
(h) the circumstances in which the Stockholder
or Security Trustee (as trustee for the
Stockholders) comes to be owed each
liability or obligation and in which each
liability or obligation comes to be secured
by this Deed, including, without
limitation, any assignment of any liability
or obligation or of this Deed; or
(i) the capacity in which the Company and the
Stockholder come to owe or be owed such
liability or obligation (including the
Stockholder acting as trustee for any
person or group of persons).
"ORIGINAL DEBENTURE STOCK TRUST DEED" means the Debenture Stock
Trust Deed dated
6.
<PAGE> 457
17 June 1998 between the Company and the Security Trustee.
"PHF TRUST" means the trust known as the "Principal Healthcare
Finance Trust" (formerly known as the "Assisted Living Unit Trust")
constituted by the Trust Deed.
"POTENTIAL EVENT OF DEFAULT" means any event which with the giving
of notice, lapse of time, satisfaction of a condition or
determination could constitute an Event of Default.
"POWER" means any right, power, authority, discretion, remedy or
privilege conferred on the Security Trustee, Receiver or any
attorney or agent appointed under this Deed by any Transaction
Document, by statute or by law or equity in respect of the Charge
or any Collateral Security.
"PRINCIPAL MONEY" means in relation to a Stockholder, the
outstanding principal amount of the Financial Liability actually or
contingently owing and secured by this Deed and each Collateral
Security being:
(a) in respect of loans, the outstanding
principal amount of those loans;
(b) in respect of money raised under a bill
facility or acceptance or like credit, the
nominal or face value of the outstanding
bills of exchange or other instruments
concerned;
(c) in respect of Treasury Transactions the
aggregate of the assessed marked to market
values for the time being of each agreement
comprising a Treasury Transaction;
(d) in respect of Finance Leases:
(i) where the amount is determined
before termination of the
Finance Lease, the amount
which would be payable if the
Finance Lease were terminated
on the relevant date for
determination of the Principal
Money;
(ii) where the amount is determined
after termination of the
Finance Lease, the outstanding
amount payable on termination;
or
(iii) such other amount as
determined by the Company's
auditor in consultation with
the Company and the relevant
Stockholder and in accordance
with Australian accounting
standards;
(e) in respect of any indemnity or like
obligation of the Company with respect to
any Guarantee, the principal amount
(determined in the same manner as set out
in paragraphs (a) to (d) inclusive of this
definition) of the obligation secured by
such Guarantee;
(f) in respect of any financial accommodation
raised by the Company
7.
<PAGE> 458
under or pursuant to an issue of bonds or
debentures where the Stockholder acts as
trustee or paying agent for the bondholders
or debentureholders, the outstanding
principal amount of the bonds or
debentures; and
(g) in respect of any other type of Financial
Liability secured by this Deed, the amount
determined by the Company's auditor in
consultation with the Company and the
relevant Stockholder and in accordance with
Australian accounting standards.
The "Principal Money" of a Stockholder will also include the Face
Amount of the Stock held by that Stockholder.
"RECEIVER" means a receiver or receiver and manager appointed by
the Security Trustee under the Charge, and, if more than one, then
each of them, and also any servant, agent or delegate of any of
them.
"REGISTER" means the register of Stockholders kept under this Deed.
"RELATED BODY CORPORATE" has the meaning given in section 9 of the
Corporations Law, but on the basis that "SUBSIDIARY" for the
purposes of that definition has the meaning given in this
Agreement.
"REPRESENTATIVE" means a proxy or representative of a Stockholder
appointed in accordance with clause 8 or clause 9 of the Meetings
Procedures.
"SECURED MONEY" means all money the payment or repayment of which
from time to time forms part of the Obligations (including, without
limitation, the Face Amount of all Stock on issue).
"SECURITY TRUST" means the trust created by this Deed.
"SECURITY TRUST FUND" means all property rights and assets which
are or become subject to the Security Trust (including, without
limitation, the rights established by this Deed and each Collateral
Security against the Company and any property or proceeds coming
into the Security Trustee's hands under any such security or to
which it is or becomes entitled under this Deed or any Collateral
Security).
"SPECIFIED RATE" means on any date the aggregate of 2% and the
average of the buy rates for bills of exchange which have a tenor
of 30 days which rates are displayed on the page of the Reuters
Monitor System designated "BBSY" at or around 10.30 am (Sydney
time) on the relevant date or, if those rates are not displayed at
that time on that date, the average of the rates quoted to the
Security Trustee by 3 Australian licensed trading banks as the rate
at which they would be prepared to purchase bills of that tenor at
or around that time.
"STATUTE" means any legislation of the Parliament of the
Commonwealth of Australia or of any State or Territory thereof in
force now or after the date of this Deed, and any rule,
8.
<PAGE> 459
regulation, ordinance, by-law, statutory instrument, order or
notice at any time made under that legislation.
"STOCK" means debenture stock issued under clause 5.
"STOCK CERTIFICATE" means a certificate issued under clause 5.
"STOCKHOLDER" means a person at any time entered on the Register as
the holder of Stock.
"SUBSIDIARY" in relation to any person, has the meaning given in
the Corporations Law but so that:
(a) an entity will also be deemed to be a
Subsidiary of a company if it is controlled
by that company (expressions used in this
paragraph have the meanings given for the
purposes of parts 3.6 and 3.7 of the
Corporations Law);
(b) a trust may be a Subsidiary, for the
purposes of which any units or other
beneficial interests will be deemed shares;
and
(c) a corporation or trust may be a Subsidiary
of a trust if it would have been a
Subsidiary if that trust were a
corporation.
"SUPPLEMENTAL TRUST DEED" means a deed entered into under clause
5.8.
"TAXES" means all present and future income, stamp and other taxes,
levies, imposts, deductions, charges and withholdings plus interest
thereon and penalties, if any, and charges, fees or other amounts
in respect of any of them except if imposed on the overall net
income of a Stockholder.
"TOTAL PRINCIPAL MONEY" means the aggregate of the Principal Money
for the time being outstanding.
"TRANSACTION DOCUMENT" means:
(a) this Deed;
(b) any Supplemental Trust Deed;
(c) each Stock Certificate issued under this
Deed;
(d) each Collateral Security;
(e) each other document to which the Company
and the Security Trustee agree in writing
(whether in a Stock Certificate or
otherwise) is to be a Transaction Document
for the purposes of this Deed; and
9.
<PAGE> 460
(f) a document or agreement entered into or
provided under or in connection with, or
for the purpose of amending or novating,
any of the above. It includes a written
undertaking by or to a party or its lawyers
under or in relation to any of the above.
"TREASURY TRANSACTION" means any foreign exchange agreement,
interest rate swap, cap or collar agreement, interest rate future
or option agreement, currency and other forms of hedging agreement
(whether entered into for the purpose of hedging or speculation or
otherwise).
"TRUST DEED" means the deed of trust dated 11 August 1995 between
the Company, Metlife Australia (Holdings) Pty Limited and FAI
Deposit Co. Pty Limited.
1.2 INTERPRETATION
In this Deed and any Stock Certificate:
(a) headings are for convenience only and do
not affect interpretation;
and unless the context indicates a contrary intention:
(b) the expression "PERSON" includes an
individual, the estate of an individual, a
body politic, a corporation and a statutory
or other authority or association
(incorporated or unincorporated);
(c) a reference to any party includes that
party's executors, administrators,
successors, substitutes and assigns,
including any person taking by way of
novation and, in the case of the trustee
includes any substituted or additional
trustee;
(d) a reference to the "Charged Property"
includes any part of it;
(e) a reference to this Deed, to a Transaction
Document or to any other document, includes
respectively this Deed, the Transaction
Document or that other document as amended,
varied, novated, supplemented, ratified or
replaced from time to time;
(f) a reference to any legislation or to any
statutory provision includes any statutory
modification, re-write or re-enactment or
any statutory provision substituted
therefor, and all ordinances, by-laws,
regulations and other statutory instruments
issued thereunder;
(g) words importing the singular include the
plural (and vice versa) and words denoting
a given gender include all other genders;
(h) a reference to a clause, schedule, annexure
or part is a reference to a clause,
schedule, annexure or part of this Deed;
10.
<PAGE> 461
(i) where any word or phrase is given a defined
meaning, any other part of speech or
grammatical form in respect of that word or
phrase has a corresponding meaning;
(j) all accounting terms used in this Deed have
the meaning given under accounting
principles and practices generally accepted
in Australia from time to time; and
(k) mentioning anything after "include",
"includes" or "including" does not limit
what else may be included.
1.3 RIGHTS OF STOCKHOLDERS
(a) The issue of Stock under this Deed will
confer on the relevant Stockholder in
respect of such Stock the benefit of:
(i) the covenants and warranties by:
A. the Security Trustee; and
B. the Company under this Deed and
under the Collateral Securities,
(ii) the conditions set out in each
Stock Certificate issued to
such Stockholder.
(b) Each Stockholder and any person claiming
under that Stockholder will be bound by the
terms and conditions of this Deed.
1.4 STOCKHOLDERS OBLIGATIONS
(a) The rights and obligations of each
Stockholder under this Deed and under any
indemnity issued to the Security Trustee
under this Deed are several and:
(i) failure by any Stockholder to carry out
its obligations will not relieve any other
Stockholder or the Company of any of their
obligations; and
(ii) no Stockholder will be
responsible for the
obligations of any other
Stockholder.
(b) The liability of each Stockholder under
this Deed or under any indemnity issued to
the Security Trustee under this Deed is
limited as to monetary amount to the amount
calculated at the time for determination of
liability as follows:
11.
<PAGE> 462
1.5 SECURITY TRUSTEE
(a) Unless the context otherwise requires, any reference to
the "Security Trustee" in this Deed will be construed as
referring to the Security Trustee as trustee for the
Stockholders except in Part B (which governs the
relationship between the Security Trustee and the
Stockholders), where such references will be construed as
references to the Security Trustee in its personal
capacity.
(b) The Company will not have any rights under or by reason
of Part B except as set out in the Meetings Procedures.
(c) As between the Company on the one hand and the Security
Trustee and the Stockholders on the other, all action
taken by the Security Trustee under any Transaction
Document will be taken to be authorised and the Company
need make no enquiry as to the authority of the Security
Trustee.
1.6 DETERMINATION OF PROPORTIONATE SHARE WITH RESPECT TO
FOREIGN CURRENCY AMOUNTS
(a) For the purposes of:
(i) the ascertainment at any time of the shares in which
the Stockholders are entitled to the benefit of this
Deed;
(ii) the ascertainment of the rateable share of each
Stockholder in accordance with clause 11.1(d), (e) or
(f);
(iii) the ascertainment of the liability of a Stockholder
under clause 1.4; and
(iv) calculation of voting and other rights under clause
20,
all of the Secured Money and the Principal Money will
be expressed (to the extent that they are not
denominated in Dollars) in Dollars.
(b) For that purpose all of the Secured Money and the
Principal Money which are for the time being denominated
in a currency ("FOREIGN CURRENCY") other than Dollars,
will be notionally converted into Dollars.
(c) The exchange rate for such conversion will be the spot
rate of exchange quoted to the Security Trustee (as
determined by the Security Trustee) for the purchase of
the appropriate amount of Foreign Currency with Dollars in
the Sydney foreign exchange market in the ordinary course
of trading at or about 10.00 am on the day in question for
delivery 2 Banking Days thereafter.
12.
<PAGE> 463
1.7 ASCERTAINMENT OF PRINCIPAL MONEY
(a) (NOTIFICATION): Each Stockholder may at any time, and
will forthwith on request by the Security Trustee, notify
the Security Trustee of the amount of the Principal Money
secured by this Deed in relation to the Stockholder.
(b) (DETERMINATION FOR VOTING): For the purposes of:
(i) the definition of Extraordinary Resolution in clause
1.1; and
(ii) the calculation of voting and other rights under
clause 20,
the Principal Money in relation to each Stockholder will be
deemed to be the amount stated in the last notice provided
under paragraph (a).
(c) NOTIFICATION OF STOCKHOLDERS): If any Stockholder so
requests before any meeting of Stockholders, the Security
Trustee will inform that Stockholder of the respective
amounts of the Principal Money ascertained under this
clause.
PART A:
THE CHARGE AND THE TRUST
2. CHARGE AND TRUST
2.1 THE CHARGE
The Company both in its personal capacity and as trustee of the PHF
Trust hereby charges all the Charged Property to the Security
Trustee to secure the due and punctual performance, observance and
fulfilment of all the Obligations and the payment in full of the
Secured Money.
2.2 THE TRUST
The Security Trustee:
(a) declares that it holds the benefit of this Deed and each
Collateral Security on trust for the Stockholders rateably
in proportion to the amount of the Secured Money owing to
each of them; and
(b) agrees to act as trustee of the Security Trust (which will
be known as the "Principal Healthcare Ongoing Security
Trust").
13.
<PAGE> 464
2.3 STOCKHOLDER'S ENTITLEMENT
A Stockholder is not entitled to any equitable or proprietary
interest in the Security Trust Fund except:
(a) the benefit of the personal covenants contained in this
Deed; and
(b) following enforcement or discharge of the Charge or any
Collateral Security included in the Security Trust Fund,
the proceeds of enforcement or discharge.
Subject to that, this Deed will confer on Stockholders a mere right
of action against the Security Trustee to require the Security
Trustee to hold the benefit of the Security Trust Fund and enforce
the covenants provided to the Security Trustee (as trustee for the
Stockholders) under this Deed or the Collateral Securities in
accordance with this Deed and the Collateral Securities and to
account to the Stockholders in accordance with this Deed.
2.4 DETERMINATION OF TRUST
The trust established by this Deed commences on the date of this
Deed and, unless determined earlier, ends on the earlier of the
following dates:
(a) the day before the 80th anniversary of the date of this
Deed; and
(b) the date which is 7 months after the day on which the
Security Trustee discharges the Charge and the Collateral
Securities.
2A. RELEASE OF CHARGE
(a) If the Company acquires assets or property the acquisition
of which is funded wholly by persons other than
Stockholders in their capacity as Stockholders ("OTHER
ASSETS"), the Security Trustee will if requested to do so
by the Company unconditionally release those Other Assets
from this Charge.
(b) For the avoidance of doubt, the parties acknowledge that
the reference in paragraph (a) to "assets or property the
acquisition of which is funded wholly by persons other
than Stockholders in their capacity as Stockholders":
(i) includes a reference to assets or property the
acquisition of which is funded out of the Company's
own cash reserves or by Omega (Australia) Pty.
Limited, Omega Worldwide Inc, Omega Healthcare
Investors Inc or Omega (UK) Limited; and
(ii) does not include a reference to assets or property
the acquisition of which is wholly or partially
funded by financial accommodation of any kind which
is provided by any Stockholder (in its capacity as
a Stockholder) to the Company.
14.
<PAGE> 465
3. NATURE OF CHARGE
3.1 ASSETS OVER WHICH THE CHARGE IS FIXED
The Charge will operate as a fixed charge over the Charged Property
listed below (whether present or future) which does not constitute
stock-in-trade of the Business:
(a) all real and leasehold property, and all fixtures and
improvements thereon;
(b) all machinery, vehicles, fittings, furniture, plant and
equipment, computer software and hardware;
(c) any Lease Guarantee, all rights of the Company under any
management contract in respect of the Business, any Lease
and all other documents, contracts, rights and records
relating to the Business;
(d) the goodwill of the Business and all Licences; and
(e) all Encumbrances, documents of title and Intellectual
Property,
with the intention that each item of future property described in
this clause 3.1 will be specifically charged to the Security
Trustee at the time it is acquired by the Company. The Charge will
operate as a floating charge as regards all other Charged Property.
3.2 DEALING WITH PROPERTY SUBJECT TO FLOATING CHARGE
Subject to any contrary provision in any Transaction Document, the
Company may in respect of any part of the Charged Property which is
subject to the floating charge created by this Deed, deal with and
pay or apply that part of the Charged Property in the ordinary
course of its ordinary business.
3.3 AUTOMATIC CRYSTALLISATION OF FLOATING CHARGE
If any Event of Crystallisation occurs, the floating charge created
by this Deed will at that time automatically crystallise and
immediately become a fixed charge over that part of the Charged
Property not immediately prior to such occurrence the subject of
the fixed charge.
3.4 NOTICE OF CONVERSION
The Security Trustee may at any time by notice in writing to the
Company convert or reconvert its security under the Charge from a
floating charge to a fixed charge or from a fixed charge to a
floating charge in respect of any asset or class of asset specified
in that notice. Any such conversion will be effective from the
moment of receipt of such notice.
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<PAGE> 466
3.5 RECONVERSION
The Security Trustee may at any time by notice in writing to the
Company reconvert its security under the Charge from a fixed charge
to a floating charge in respect of any asset or class of asset
specified in that notice.
3.6 PROSPECTIVE LIABILITY
For the purpose only of section 282(3) of the Corporations Law the
specified maximum amount of the prospective liability secured by
the Charge is $200,000,000. The nature of the prospective liability
is as shown on the notice lodged with the Charge with the
Australian Securities Commission. Nothing in this clause 3.6 will
limit, or put the Security Trustee under any obligation to do any
act or thing so as to increase, the amount of the money secured by
the Charge.
3.7 CONVERSION TO LEGAL MORTGAGE
If an Event of Default occurs and is not waived or remedied in the
period (if any) permitted in any Transaction Document, at any time
thereafter if such event continues the Security Trustee may procure
itself (or its nominee) to be registered as the holder of any
shares forming part of the Charged Property. Without limiting the
generality of the foregoing, the Company irrevocably and
unconditionally authorises the Security Trustee to date and
complete any transfers and lodge such transfers for stamping and
registration accompanied by the share certificates relating
thereto, if applicable. The Security Trustee's costs and expenses
relating to the transfer and registration, including stamp duty and
other taxes, will be payable by the Company on demand and will form
part of the Secured Money.
4. INDEBTEDNESS
4.1 ACKNOWLEDGEMENT
The Company acknowledges to the Security Trustee its indebtedness
(both present and future, actual and contingent) in respect of the
Secured Money (including, without limitation, each part of any
Financial Accommodation provided).
4.2 PAYMENT
The Company agrees with the Security Trustee that it will duly and
punctually pay the Secured Money (including, without limitation,
interest) in the same manner and in the same currency as the
Company is required to pay the Secured Money as provided in the
relevant Transaction Document except where the Security Trustee
directs the Company in writing to pay that money to it in which
case the Company will comply with such direction.
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<PAGE> 467
4.3 SATISFACTION
Due payment under any Transaction Document will to the same extent
constitute due payment of the Secured Money secured by this Deed
and vice versa.
5. CREATION, ISSUE AND REGISTRATION OF STOCK
5.1 ISSUE OF STOCK
The Company may subject to this clause 5 at any time before the
determination of the Security Trust create and issue stock to any
creditor or proposed creditor of the Company who subscribes for
Stock (including, without limitation, the Security Trustee acting
in its personal capacity).
5.2 MONEY SECURED
The issue of Stock for or Stock Certificates referring to a
particular Face Amount of Principal Money will not restrict the
amount of Secured Money secured for the benefit of a Stockholder by
this Deed and the Collateral Securities.
5.3 CONDITIONS OF ISSUE OF STOCK
Stock may be issued on terms and conditions which may relate to any
one or more of the following matters:
(a) the Face Amount;
(b) payment on demand or at the expiration of periods or upon
the occurrence of particular events or at a particular
date; and
(c) any limitation on the rights of the Stockholder to enforce
such Stock.
5.4 NOTIFICATION OF SECURITY TRUSTEE
Whenever the Company wishes to issue any Stock it will immediately
notify the Security Trustee of:
(a) the name of the proposed Stockholder;
(b) the terms and conditions of such issue;
(c) the Secured Money (including the proposed Face Value)
referable to the proposed Stockholder; and
(d) details of the proposed Transaction Document.
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<PAGE> 468
5.5 SECURITY TRUSTEE'S CONSENT TO ISSUE STOCK
(a) The Company may not issue Stock (other than Initial Stock)
unless it has first obtained the Security Trustee's
consent to the issue of that Stock.
(b) The Security Trustee will not consent to the issue of any
Stock (other than Initial Stock) unless directed to by a
unanimous resolution of all Stockholders.
(c) The Security Trustee will if directed by the Stockholders
confirm its consent to the issue of Stock by endorsing
that confirmation on the corresponding Stock Certificate,
in which case such endorsement will be conclusive. No
Stock will be valid or effective unless the Security
Trustee has endorsed such confirmation on the Stock
Certificate.
5.6 ISSUE AFTER ENFORCEMENT OF CHARGE
The Company may not create or issue any Stock whilst any Event of
Default is subsisting or after enforcement of the Charge or any
Collateral Security has commenced unless the appointment of all
Receivers appointed thereunder has been terminated.
5.7 CANCELLATION
(a) The Company may at any time cancel any Stock created but
not issued.
(b) Upon redemption of any Stock on issue the Company will
immediately cancel that Stock.
5.8 SUPPLEMENTAL TRUST DEEDS
(a) The Company and the Security Trustee may execute
Supplemental Trust Deeds in respect of any unissued Stock,
or in respect of any issued Stock with the consent of the
relevant Stockholder.
(b) Supplemental Trust Deeds may contain further duties and
powers of the Security Trustee, further covenants and
events of default and warranties and such other
provisions, not being inconsistent with the provisions of
this Deed, as the Company and Security Trustee may think
fit.
(c) No Supplemental Trust Deed will contain any provision
which will derogate in any way from the right or interest
of any Stockholder other than the Stock in respect of
which it is executed.
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5.9 PRIORITY
The benefit of this Deed and the Collateral Securities will be held
by the Security Trustee for the proportionate use, benefit and
security of all Stockholders in respect of the Secured Money
without any discrimination or preference or priority of any one
Stockholder or of any one portion of the Secured Money over any
other by reason of priority in the time of issue of Stock or of the
provision of Financial Accommodation or of the incurring of any
Financial Liability or for any other reason whatsoever except to
the extent that the rights of holders of particular Stock may
expressly be restricted by the terms of issue of that Stock or any
relevant Supplemental Trust Deed.
5.10 REGISTER
The Security Trustee will on behalf of the Company keep or cause to
be kept in Sydney (or such other place as the Security Trustee and
Company may agree) a register of Stockholders and will enter in
such register:
(a) the names and addresses of the Stockholders from time to
time and a description of the Stock held by them
respectively;
(b) the date on which the name of each person was entered into
the Register as a Stockholder;
(c) the date on which any person who has ceased to be a
Stockholder so ceased to be a Stockholder; and
(d) the date of every issue of Stock to Stockholders and the
Face Amount of Stock comprised in each issue.
5.11 BRANCH REGISTER
The Security Trustee (on behalf of the Company) may at its option
cause to be kept in any State or Territory of Australia other than
that in which the Register is located, at any office of the
Security Trustee or its Related Bodies Corporate a branch register
of Stockholders which will be deemed to be part of the Register and
will be kept in the same manner in which the Register is required
to be kept under this Deed.
5.12 CERTIFICATES
The Company will issue to every Stockholder in respect of Stock
held by him a certificate in or to the effect of the form of
Schedule 4 or in such other form as the Security Trustee approves.
5.13 CONDITIONS OF ISSUE
(a) Stock will be held with the benefit of and subject to the
conditions contained in the Stock Certificate.
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(b) Those conditions will be binding on the Company and
the holders of such Stock and all persons claiming
through them respectively.
5.14 EXECUTION OF CERTIFICATES
Every Stock Certificate will be executed by the Company under its
common seal or by the signature of its duly constituted attorney.
5.15 REGISTER CONCLUSIVE
The Stockholders whose names appears for the time being in the
Register are to be regarded as the beneficial owners of the Stock
in issue which is registered in their respective names and except
as required by law neither the Company nor the Security Trustee
will be bound in any way to recognise (even when having notice
thereof) any equitable, contingent, future or partial interest in
any Stock.
5.16 REGISTER AVAILABLE FOR INSPECTION
The Company will ensure that the Register is at all times during
business hours open for inspection by each Stockholder.
5.17 INVITATION TO SUBSCRIBE
By executing this Deed the Company invites the Initial Stockholder
(and any other person to whom the Security Trustee delivers a copy
of this Deed at any time) to subscribe for Stock in the Face Amount
of $100.
5.18 SUBSCRIPTION FOR STOCK
Each proposed Stockholder (wherever it is resident or domiciled)
will subscribe for its stock in any place agreed by the Security
Trustee and the Company by executing an application in the form of
Schedule 2 and paying the relevant subscription money. the Company
will, subject to this Deed, accept such subscriptions (and any
subsequent subscriptions) by executing an acceptance in the form of
Schedule 3.
5.19 TRANSACTION DOCUMENT
The Security Trustee will not agree that any document is a
Transaction Document for the purposes of this Deed (as contemplated
in paragraph (e) of the definition of Transaction Document) unless
directed to by a unanimous resolution of all Stockholders or all
Stockholders agree in writing with the Security Trustee.
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6. REPRESENTATIONS AND WARRANTIES
6.1 GENERAL REPRESENTATIONS AND WARRANTIES
The Company represents and warrants to the Security Trustee that:
(a) (GOOD TITLE): it has good right to charge the Charged
Property as beneficial owner in the manner provided in
this Deed and in each Collateral Security, and the Charged
Property is free of all Encumbrances;
(b) (LEGALLY BINDING OBLIGATION): this Deed constitutes a
valid and legally binding obligation of the Company in
accordance with its terms;
(c) (EXECUTION, DELIVERY AND PERFORMANCE): the execution,
delivery and performance of this Deed by the Company does
not violate any Statute or law, or any document or
agreement to which the Company is a party or which is
binding on it or any of its assets;
(d) (AUTHORISATION): all consents, licences, approvals and
authorisations of every Government Authority required to
be obtained by the Company in connection with the
execution, delivery and performance of this Deed have been
obtained and are valid and subsisting;
(e) (FINANCIAL LIABILITIES): the Company is not in default in
the payment of any material sum or in the performance or
observance of any material obligation in respect of any
Financial Liability, and no event has occurred which with
the giving of notice, lapse of time or other condition
could constitute a material default in respect of any
Financial Liability;
(f) (NO EVENT OF DEFAULT): no event has occurred which
constitutes an Event of Default or a Potential Event of
Default;
(g) (STATUTES): the Company has not failed to comply with any
Statute relative to it or the Business where such failure
may have a material adverse effect on the Company's
ability to observe its obligations under the Transaction
Documents; and
(h) (NO TRUSTS): the Company is not the trustee of any trust
(other than the PHF Trust) nor does it hold any property
subject to or impressed by any trust (other than the PHF
Trust).
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6.2 CORPORATE REPRESENTATIONS AND WARRANTIES
The Company further represents and warrants to the Security Trustee
that:
(a) (DUE INCORPORATION): it is duly incorporated and has the
corporate power to own its property and to carry on its
business as is now being conducted;
(b) (CONSTITUTION): the execution, delivery and performance of
this Deed does not violate constitution of the Company;
(c) (CORPORATE POWER): it has the power and has taken all
corporate and other action required to enter into this
Deed and to authorise the execution and delivery of this
Deed and the performance of its obligations under this
Deed; and
(d) (FILINGS): the Company has filed all corporate notices and
effected all registrations with the Australian Securities
Commission and all of those filings and registrations are
current, complete and accurate.
6.3 TRUST REPRESENTATIONS AND WARRANTIES
The Company represents and warrants to the Security Trustee that:
(a) (SECURITY TRUSTEE): it enters, or has entered, into this
deed in its capacity as trustee of the PHF Trust;
(b) (TRUST VALIDLY CREATED): the PHF Trust has been validly
created and is in existence at the date of this Deed;
(c) (SOLE TRUSTEE): it has been validly appointed as trustee
of the PHF Trust and is presently the sole trustee of the
PHF Trust;
(d) (TRUST DEED): the PHF Trust is solely constituted by the
Trust Deed, (a true copy of which was provided to the
Security Trustee or its agent prior to the date of this
Deed) and the Trust Deed discloses all the terms of the
PHF Trust other than terms implied by law;
(e) (SECURITY TRUSTEE'S POWER): it has full and free power to
enter into this deed in its capacity as trustee of the PHF
Trust;
(f) (TRUST AUTHORISATIONS): it has in full force and effect
all authorisations necessary to enter into this deed as
trustee of the PHF Trust, and to perform its obligations
under them;
(g) (NO REMOVAL OF TRUSTEE): no action has been taken or is
proposed to remove it as trustee of the PHF Trust;
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<PAGE> 473
(h) (NO DEFAULT OF TRUSTEE): it is not in default under the
Trust Deed which would have the effect of limiting or
removing its right of indemnity from the property of the
PHF Trust, or would affect its power or ability to enter
into this deed (or to perform its obligations under this
deed) as trustee of the PHF Trust;
(i) (TRUST OBLIGATIONS): it has complied with its obligations
in connection with the PHF Trust;
(j) (VESTING DATE NOT DECLARED): a date has not been declared
pursuant to the Trust Deed as the date on which the PHF
Trust will be vested or come to an end, and no other
action has been taken or is proposed to terminate the PHF
Trust;
(k) (NO PROCEEDINGS): no proceedings of any description have
been or are likely to be commenced or threatened which
could have a material adverse effect on the assets or
financial position of the PHF Trust or on its trusteeship
thereof;
(l) (NO ACQUISITION OF TRUST ASSETS): it has not done, or
failed to do, any act whereby any of the assets of the PHF
Trust have been acquired by any other person and no assets
of the PHF Trust are presently registered in the name of
any other person and no person, other than the Trustee and
the beneficiaries of the PHF Trust from time to time, has
acquired any right of any kind whether vested or
contingent in any asset of the PHF Trust;
(m) (INDEMNITY): it has a right to be fully indemnified out of
the property of the PHF Trust in respect of obligations
incurred by it under this deed; and
(n) (COMMERCIAL BENEFIT): it is to the commercial benefit of
the PHF Trust that it enters into this deed in its
capacity, inter alia, as trustee of the PHF Trust.
6.4 REPRESENTATIONS AND WARRANTIES REPEATED
Each representation and warranty in this Deed will be repeated on
each day whilst any of the Secured Money remains outstanding
(whether or not then due for payment) with reference to the facts
and circumstances then subsisting, as if made on each such day.
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7. COVENANTS CONCERNING THE CHARGED PROPERTY
7.1 RESTRICTIONS IN RELATION TO THE CHARGED PROPERTY
The Company will not without the Security Trustee's prior written
consent (which will not be unreasonably withheld):
(a) (NO ENCUMBRANCES): create, purport or attempt to create or
permit to exist any Encumbrance howsoever ranking over any
part of the Charged Property.
(b) (NO SALE, LEASE ETC.): convey, assign, transfer, lease or
otherwise dispose or part with possession of, make any
bailment over, grant any option over or create or permit
to exist any other interest in any part of the Charged
Property whilst such part of the Charged Property is
subject to the fixed charge created in this Deed or in any
Collateral Security;
(c) (NOT TO PREJUDICE): do or permit any act, omission or
thing whereby any part of the Charged Property becomes or
could be liable to surrender, forfeiture or cancellation
or becomes prejudiced in any manner or the value of the
Charge as a security to the Security Trustee becomes or
could be materially lessened;
(d) (ORDINARY COURSE): subject to this Deed, deal with or
attempt to deal with the Charged Property other than in
the ordinary course of its ordinary business;
(e) (AMENDMENTS, ETC): amend, vary, terminate, cancel or
surrender any Lease or any Lease Guarantee in any material
respect; or
(f) (STEP): take any step towards doing any of these things.
7.2 INSPECTION
The Company will following the occurrence of any Event of Default
(or if the Security Trustee suspects, on reasonable grounds, that
an Event of Default may have occurred) permit the Security Trustee
and any employee, agent or professional adviser of the Security
Trustee, to enter any land or buildings owned or occupied by the
Company or any Related Body Corporate of the Company, at all
reasonable times, without notice, to inspect its condition and to
monitor compliance with this Deed (so long as to do so will not
cause the Company to be in breach of any Statute or any lease of
such land or buildings).
7.3 PROTECTION OF CHARGED PROPERTY
At the request of the Security Trustee, the Company will take or
defend all legal proceedings that the Security Trustee considers
necessary or desirable for the preservation,
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<PAGE> 475
protection or recovery of all or any part of the Charged Property.
7.4 CONDUCT OF BUSINESS
The Company will carry on and conduct the Business in a proper and
efficient manner and will not materially change the general
character of or discontinue the Business without the Security
Trustee's prior written consent.
7.5 INTELLECTUAL PROPERTY
The Company will maintain and renew all its present
and future Intellectual Property.
7.6 LICENCES
The Company will:
(a) (APPLY): apply for (or procure the application for) and
use (or procure that the applicant uses) its best
endeavours to obtain and maintain each licence which is
not held in respect of the Business but which is required
by law to be held;
(b) (RENEW): on or before the time and in the manner
prescribed by the relevant Statute for each Licence, apply
for (or procure the application for) and procure the
renewal of each Licence, and pay or cause to be paid the
renewal fees and other sums required in respect of the
Licence or the renewal of the Licence within the time
allowed and in the manner prescribed by the Statute;
(c) (PRODUCTION OF THE LICENCE): whenever reasonably requested
by the Security Trustee, produce to the Security Trustee
(or procure the production to the Security Trustee of)
each Licence and all receipts for payments in relation to
each Licence;
(d) (NO CANCELLATION): not do, allow or suffer any act, matter
or thing as a result of which any Licence is surrendered,
forfeited, withdrawn, cancelled, refused or rendered void,
or whereby the holder of any Licence is disqualified
permanently or temporarily from receiving or continuing to
hold a Licence, or whereby the Business may be
disqualified permanently or temporarily from having a
Licence; and
(e) (COMPLY WITH STATUES): procure that the holder of any
Licence complies with all Statutes and all lawful
requirements of every Government Authority in relation to
the Licence (to the extent that such compliance is
necessary to ensure that the Licence is not revoked,
terminated or forfeited) and otherwise does all things so
required of the holder.
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7.7 SECURITY TRUSTEE ASSUMES NO OBLIGATIONS
The Security Trustee will not be deemed by virtue of this Deed to
have assumed any obligation of the Company under any Licence or
Statute.
7.8 DOCUMENTS OF TITLE AND OTHER SECURITIES
The Company will lodge with the Security Trustee all documents
relating to each Encumbrance under which the Company is the
Encumbrancee, all certificates, scrip and other indicia of the
Company's title or interest in any Marketable Securities, all
negotiable instruments other than cheques, and all other documents
of title to the whole or part of the Charged Property immediately
on receipt of the same.
7.9 POSTPONEMENT OR WAIVER OF ENCUMBRANCES
The Company will, if requested by the Security Trustee, immediately
cause:
(a) any Encumbrance which has arisen or which arises from time
to time by operation of law over the Charged Property in
favour of any person (including the Company) to be at the
Security Trustee's option postponed in all respects after
and subject to the Charge or to be otherwise discharged,
released or terminated; and
(b) any Financial Liability or other obligation secured by any
such Encumbrance at the Security Trustee's option to be
waived, released, paid or performed.
8. EVENTS OF DEFAULT
If any Event of Default occurs and while it subsists at the option
of the Security Trustee and notwithstanding any delay or previous
waiver of the right to exercise that option, all Powers not
previously exercisable become exercisable, and also at the like
option of the Security Trustee, the right of the Company to deal
with the Charged Property immediately ceases.
9. RECEIVERS: APPOINTMENT AND POWERS
9.1 APPOINTMENT OF RECEIVER
At any time after the happening of any Event of Default or after
the whole or part of the Secured Money becomes due and payable
under the provisions of this Deed, the Security Trustee may if
directed by an Extraordinary Resolution of Stockholders:
(a) appoint in writing any person or persons to be a receiver
or receiver and manager of the whole or part of the
Charged Property;
(b) withdraw the appointment of that Receiver as to the whole
or part of
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<PAGE> 477
the Charged Property; and
(c) (in case of the removal, retirement or death of any
Receiver) appoint another person or persons in his place.
9.2 JOINT RECEIVERS
If more than one person is appointed as a Receiver of the whole or
any part of the Charged Property, the Security Trustee may specify
whether the appointment, and the Powers of each appointee, will at
its option be joint, or joint and several, and failing such
specification, the appointment and the Powers of each person will
be deemed to be joint and several.
9.3 REMUNERATION OF RECEIVER
The Security Trustee may fix the remuneration of any Receiver at
such rate as the Security Trustee from time to time determines,
which rate will not exceed the standard hourly rate from time to
time charged by the firm of which the Receiver is a member for work
of the level conducted by the Receiver.
9.4 AGENT OF THE COMPANY
Every Receiver will be the agent of the Company who will be solely
responsible for all acts and omissions by and the remuneration of
the Receiver.
9.5 POWERS OF RECEIVER
Without the need for any consent by the Company, each Receiver will
have all of the powers specified in section 420 of the Corporations
Law, and in addition to those and any other Powers, will have all
of the following powers:
(a) (TO TAKE POSSESSION): to take possession or control of or
make use of the whole or any part of the Charged Property
or relinquish such possession or control;
(b) (TO CONVERT TO MONEY): to convert, liquidate and reduce
the whole or any part of the Charged Property into money;
(c) (TO LEASE): whether or not the Receiver has taken
possession, to lease or licence in the name of the Company
or otherwise the whole or any part of the Charged Property
for any period and on any terms or to vary or terminate a
lease or licence;
(d) (TO CARRY ON BUSINESS): to carry on or concur in carrying
on each Business and do all acts which the Company might
do in the ordinary conduct of such Business for the
protection or improvement of the whole or part of the
Charged Property;
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<PAGE> 478
(e) (TO BORROW OR RAISE MONEY): to borrow or raise from the
Security Trustee or any other person any money which may
be required for any purpose and in the name of the Company
or otherwise to secure any money so borrowed or raised by
the grant of any Encumbrance over the whole or part of the
Charged Property so that the Encumbrance ranks in priority
to, pari passu with or after the Charge. The Security
Trustee will not be bound to inquire as to the necessity
or propriety of any Financial Liability nor be responsible
for the misapplication or non-application of any money so
borrowed or raised;
(f) (TO ENGAGE): to engage consultants, contractors,
professional advisers, agents and employees (including any
person associated with a firm or company in which the
Receiver is a member or in which he is interested, and
that person may charge for his services as if he had been
independently retained at such salaries or remuneration as
the Receiver thinks fit), and the Receiver may act on any
advice given by that person;
(g) (TO CONDUCT WORKS): to repair, renew, replace, renovate or
clean the Charged Property, to erect any new buildings or
make any improvements to any land forming part of the
Charged Property, and to demolish, alter, rebuild or
extend any existing buildings on the Charged Property;
(h) (TO SELL PROPERTY): whether or not in possession, to sell
or concur in selling all or any of the Charged Property by
public auction, private treaty or tender, for cash or on
credit, in one lot or in parcels, with or without special
conditions as to title or the time and the mode of payment
of purchase money and on such other terms as the Receiver
thinks fit, with power to defer payment of any part of the
purchase money, whether or not secured by an Encumbrance
from the purchaser and to buy in and to rescind or vary
any contract for sale, and to resell without being
responsible for loss;
(i) (CONTRACTS FOR SALE): to exercise all or any rights,
powers and remedies of the Company under any contract for
sale and to execute those contracts, transfers,
applications for transfer, assignments and assurances of
all or any part of the Charged Property in the name and on
behalf of the Company or otherwise, and to do all other
acts and things for implementing and completing any sale
that the Receiver deems necessary;
(j) (TO SEVER AND SELL FIXTURES): to sever fixtures belonging
to the Company and to sell those separately from any other
part of the Charged Property;
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<PAGE> 479
(k) (TO INVEST PROCEEDS AGAINST CONTINGENCIES): if any part of
the Secured Money is contingent, to invest, deposit or
hold any part of the Charged Property in a form or mode of
investment for the time being as the Receiver in its
absolute discretion thinks fit, with like power to vary,
transpose or re-invest the investments or deposits from
time to time until such part of the Secured Money ceases
to be contingent;
(l) (TO ENTER INTO CONTRACTS): to enter into any contract or
arrangement with any person for any purpose connected with
this Deed or the whole or any part of the Charged Property
or in furtherance of any Power, on such terms and
conditions as the Receiver in its absolute discretion
thinks fit, including without limitation, granting or
conferring options to, in favour of or exercisable by any
person for the purpose of or in connection with the sale,
purchase, leasing, hiring, or other dealing with, the
whole or any part of the Charged Property;
(m) (TO PERFORM CONTRACTS): to perform, observe and carry out,
enforce specific performance of, exercise or refrain from
exercising, the Company's rights and powers under, obtain
the benefit of, and to vary or rescind, all contracts and
rights forming part of the Charged Property or entered
into in the exercise of any Power;
(n) (TO TAKE PROCEEDINGS): to institute, conduct or defend any
proceedings in law, equity or bankruptcy, and to submit to
arbitration, mediation or conciliation in the name of the
Company or otherwise and on any terms, any proceeding,
claim, question or dispute in connection with the Charged
Property or otherwise;
(o) (TO COMPROMISE): to make any settlement, arrangement or
compromise regarding any action or dispute arising in
connection with the Charged Property; to grant to any
person involved therein time or other indulgence; and to
execute such releases or discharges in connection
therewith as the Receiver thinks expedient in the
interests of the Security Trustee;
(p) (TO APPEAL): to appeal against or to enforce any judgment
or order;
(q) (TO BANKRUPT DEBTORS AND WIND-UP COMPANIES): to make
debtors bankrupt and to wind-up companies and to do all
things in connection with any bankruptcy or winding up
which the Receiver thinks necessary for the recovery or
protection of the whole or part of the Charged Property,
or for the security or other benefit of the Security
Trustee;
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<PAGE> 480
(r) (TO DELEGATE): with the consent in writing of the Security
Trustee, to delegate to any person for such time or times
as the Security Trustee approves, any of the Powers,
including this power of delegation;
(s) (TO FILE): to file all certificates, registrations and
other documents and to take any and all action on behalf
of the Company which the Security Trustee or Receiver
believes is necessary to protect, preserve or improve any
or all of the Charged Property and the rights of the
Company and the Security Trustee in respect of any
agreement for sale, and to obtain for the Security Trustee
and the Stockholders all of the benefits of the Charge and
any Transaction Document; and in particular, the placing
of the Company into liquidation or the appointment of a
Receiver will be deemed to be an event against which the
Security Trustee may protect its rights;
(t) (TO MAKE CALLS): to call and get in the uncalled and
called but unpaid nominal or premium capital of the
Company;
(u) (TO OPERATE BANK ACCOUNTS): to open or operate any bank
account in the name of the Company (whether alone or
jointly) to the exclusion of the Company, and to deposit
or withdraw any money to the credit of that account, and
to sign and indorse or to authorise others to sign and
indorse in the name of the Company cheques, promissory
notes bills of exchange and other negotiable instruments;
(v) (TO DO ALL OTHER THINGS NECESSARY): to do all things
necessary to perform, observe and fulfil any of the
covenants on the part of the Company contained in this
Deed; and
(w) (RECEIVER'S DISCRETION): to do all other acts and things
without limitation as such Receiver thinks expedient in
the interests of the Security Trustee or the Stockholders,
and any further powers and discretions as the Security Trustee
confers on the Receiver by notice in writing to the Receiver for
the purposes referred to in this clause 9.5.
9.6 INDEMNITY
The Security Trustee may give such indemnities to the Receiver
concerning the performance of the Receiver's duties as are
permitted by law, and if the Security Trustee is obliged to pay any
money under any indemnity, that money will become part of the
Secured Money.
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10. SECURITY TRUSTEE'S POWERS
10.1 EXERCISE OF POWER
At any time after the happening of any Event of Default or after
the whole or part of the Secured Money becomes due and payable
under the provisions of this Deed the Security Trustee may if
directed by an Extraordinary Resolution of Stockholders without
notice and whether or not a Receiver has been appointed:
(a) exercise all or any of the Powers conferred on a Receiver
or which would be conferred on a Receiver if appointed as
if those Powers had been expressly conferred on the
Security Trustee;
(b) exercise all other Powers; and
(c) appoint an agent or joint and several agents and delegate
such powers to it or them (in which case clauses 9.1, 9.3
and 9.6 will apply as if it or they were appointed as a
Receiver).
10.2 ACT JOINTLY
The Security Trustee or Receiver may exercise any of the Powers in
conjunction with the exercise of similar powers by any other
Encumbrancee of the whole or part of the Charged Property or by any
receiver appointed by that other Encumbrancee, and may enter into
and give effect to agreements and arrangements with that other
Encumbrancee or receiver as the Security Trustee or Receiver thinks
fit.
10.3 POWER OF ATTORNEY
(a) The Company irrevocably appoints the Security Trustee,
each director, manager and attorney from time to time of
the Security Trustee, and any Receiver severally, as its
attorney, with power at any time after the occurrence of
an Event of Default (and to the extent to which the Event
of Default has not been remedied or waived) to:
(i) do all acts which ought to be done by the Company
under this Deed or to exercise any Power;
(ii) demand, sue for, recover and receive all or any
part(s) of the Charged Property from any person, in
the name of and on behalf of the Company, or in the
name of the Security Trustee or an attorney
appointed under this Deed;
(iii) take further action and to execute further
instruments which are, or are in the opinion of the
Security Trustee, either necessary to more
satisfactorily secure the payment of the Secured
Money or are expedient in relation to the Charged
Property; and
(iv) appoint (and remove at will) at any time any
person(s) as
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a substitute(s) for an attorney or attorneys.
(b) The Company ratifies and confirms now and for the future
all actions lawfully undertaken by or on behalf of its
attorney under this Power of Attorney.
(c) The Company declares that this Power of Attorney will
continue in force until all actions taken under it have
been completed, notwithstanding the discharge of the
Charge or any of the agreements or arrangements to which
it refers.
10.4 SECURITY TRUSTEE MAY MAKE GOOD DEFAULT
If the Company defaults in duly performing, observing and
fulfilling any of the Obligations, the Security Trustee may,
without prejudice to any other Power, do all things and pay all
money necessary or expedient in the opinion of the Security Trustee
to make good or to attempt to make good that default to the
satisfaction of the Security Trustee.
10.5 NOTICE FOR EXERCISE OF POWERS
(a) The Powers may be exercised by the Security Trustee and
the Receiver immediately or at any time after an Event of
Default occurs without any notice or lapse of time being
necessary unless required by a law which cannot be
excluded.
(b) One day is hereby fixed as the period for which:
(i) default must continue in the performance,
observance and fulfilment of the whole or any part
of the Obligations, or in the payment of any part
of the Secured Money, including interest, before
the Security Trustee may serve any notice in
writing as required by any Statute affecting the
Powers; and
(ii) default must continue after the service of notice
before any power of sale given by Statute may be
exercised.
11. APPLICATION OF MONEY
11.1 PRIORITY OF PAYMENTS
All money received by the Security Trustee or by the Receiver as a
result of the exercise of the Powers in respect of the Company will
be applied in the following order:
(a) (INCIDENTAL TO EXERCISE OF POWERS): in payment of all
costs, charges, expenses and disbursements incurred in or
incidental to the exercise or attempted exercise of any of
the Powers;
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(b) (OUTGOINGS): in payment of any other outgoings as the
Receiver or the Security Trustee thinks fit;
(c) (PAYMENT OF SECURED MONEY SECURED BY THE STOCK): in
payment to the Stockholders in respect of the Secured
Money (other than the Face Amount) secured by the Stock
(rateably according to the respective amounts of their
respective Secured Money as at the date of the payment is
made);
(d) (PAYMENT OF FACE AMOUNT): in payment to the Stockholders
in respect of the Face Amount secured by the Stock
(rateably according to the respective amounts of their
respective Secured Money as at the date the payment is
made);
(e) (SUBSEQUENT ENCUMBRANCES): in payment of subsequent
Encumbrances of which the Security Trustee is aware in the
order of their priority; and
(f) (SURPLUS): the surplus (if any) belongs to the Company but
does not carry interest.
11.2 CONTINGENT INDEBTEDNESS
If the Security Trustee receives money in connection with this Deed
when part of the Secured Money is contingently or prospectively
owing, then the Security Trustee must deposit an amount not
exceeding that part in an interest-bearing deposit account with a
bank on such terms as the Security Trustee thinks fit until that
part becomes actually payable or no longer falls within the
definition of "Secured Money". At that time the Security Trustee
may retain for its own account the amount which is then actually
payable to it. The balance is to be paid in accordance with clause
11.1.
11.3 MONEY RECEIVED
In applying any money towards satisfaction of the Secured Money,
the Company will be credited only with so much of the money
available for that purpose as will be actually received by the
Security Trustee or the Receiver and not required for whatever
reason to be disgorged, any credit to date from the time of
receipt.
11.4 APPLICATION OF PAYMENTS OR CREDITS
Subject to this clause 11, each of the Security Trustee and the
Receiver has an absolute discretion to apply any payment or credit
received by it under the Charge in reduction of any part or parts
of the Secured Money, whenever and on whatever account the same
became secured, notwithstanding any principle or presumption of law
to the contrary or any direction given at the time of receipt, and
without the need to communicate its election to any person.
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11.5 RELIANCE ON CERTIFICATE
In making any payment to any other Encumbrancee under clause 11.1,
the Security Trustee and the Receiver may rely on a certificate
from that Encumbrancee as to the amount secured, and are not bound
to enquire as to the accuracy of the certificate or whether the
amount referred to is validly secured by the Encumbrance.
12. LIABILITY AND RELEASE
12.1 CONTINUING OBLIGATION
This Deed constitutes a continuing obligation regardless of any
settlement of account, intervening payment, express or implied
revocation, or any other matter or thing. Without limiting the
generality of the foregoing each indemnity in this Deed is a
separate additional and continuing obligation and will survive the
discharge of the Charge. Unless otherwise agreed, payment by the
Security Trustee will not be a pre-condition to liability under any
indemnity.
12.2 PERSONAL LIABILITY
Notwithstanding any payout figure quoted or other form of account
stated by the Security Trustee, and notwithstanding the rule in
Groongal Pastoral Company Limited (In Liquidation) v. Falkiner
(1924) 35 CLR 157, no grant of full or partial satisfaction of or
discharge from the Charge by the Security Trustee will release the
Company from personal liability under this Deed or under any
Transaction Document until all the Secured Money has in fact been
received by the Security Trustee and is not liable to be disgorged
for any reason, notwithstanding that the quotation or statement of
account has arisen from the mistake, negligence, error of law or
error of fact of the Security Trustee, its servants or agents.
12.3 SETTLEMENT CONDITIONAL
Any settlement or discharge between the Company and the Security
Trustee is conditional on any security or payment given or made to
the Security Trustee by the Company or any other person in relation
to the Obligations not being avoided, repaid or reduced by virtue
of any Insolvency Provision. If the security or payment is avoided,
repaid or reduced, the Security Trustee is entitled to recover the
value or amount of such security or payment avoided, repaid or
reduced from the Company subsequently as if that settlement or
discharge had not occurred.
12.4 COMPANY'S LIABILITY NOT AFFECTED
The liability of the Company under this Deed:
(a) (ABSOLUTE): is absolute and is not subject to the
execution of any Transaction Document or any other
document by any person or to the performance of any
condition precedent or subsequent;
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(b) (NOT AFFECTED): will not be affected by any act, omission,
matter or thing that would otherwise operate in law or in
equity to reduce or release the Company from its liability
including, without limiting the generality of the
foregoing, any of the following:
(i) the occurrence of any Event of Default;
(ii) the receipt by the Security Trustee of any payment,
dividend or distribution under any Insolvency
Provision in relation to the Company;
(iii) any Transaction Document or any payment the making
of which would otherwise have formed part of the
Secured Money being or becoming or being conceded
to be illegal, invalid, void, voidable,
unenforceable or irrecoverable in whole or in part
for any reason whether past, present or future,
including, without limiting the generality of the
foregoing:
A. any Statute, other law or principle of
equity;
B. any act or omission by any person;
C. any legal limitation, disability or
incapacity of the Company;
D. any improper exercise of a Power;
E. any Power being suspended or postponed by
Statute, any court order or otherwise; or
F. any Insolvency Provision;
(iv) the Security Trustee accepting any Transaction
Document;
(v) the Security Trustee granting time, waiver or other
indulgence or concession to, or to making any
composition or compromise with, the Company;
(vi) the Security Trustee forbearing or neglecting to
exercise any remedy or right it has for the
enforcement of any Transaction Document or any of
the Obligations;
(vii) any laches, acquiescence or other act, neglect,
default, omission or mistake by the Security
Trustee;
(viii) the determination, rescission, repudiation or
termination, or the acceptance of any of the
foregoing, by the Security Trustee or the Company
of any Transaction Document or any of the
Obligations;
(ix) execution of any Transaction Document or any
variation to any Transaction Document or any of the
Obligations, whether or not such event imposes an
additional liability upon or is onerous on the
Company;
(x) the full, partial or conditional release or
discharge by the Security Trustee or by operation
of law, of any person from any Transaction Document
or any of the Obligations;
(xi) the release of any property from any Transaction
Document or the substitution of any property in
place of any other
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property now or hereafter the subject of a
Transaction Document;
(xii) the Security Trustee wasting, destroying,
abandoning, prejudicing or not perfecting,
maintaining, preserving, enforcing or realising or
not properly enforcing or realising a Transaction
Document;
(xiii) the failure to obtain any Transaction Document or
the loss or impairment of any Transaction Document
by operation of law or otherwise, whether or not
the same is in breach of an express or implied
condition to obtain or preserve such Transaction
Document or in breach of any equitable duty which
might otherwise have been imposed upon the Security
Trustee;
(xiv) the postponement or loss of the priority attaching
to any Transaction Document;
(xv) the opening or operation of any new account with
the Security Trustee by the Company;
(xvi) any change in membership (whether by death or
retirement of an existing member, admission of a
new member or otherwise) or name of any
partnership, firm or association in which the
Company is a member;
(xvii) the transfer or assignment of the benefit of any
Transaction Document or of any of the Obligations;
(xviii) any failure by the Security Trustee to disclose to
the Company any material or unusual fact,
circumstance, event or thing whatsoever known to,
or which ought to have been known by, the Security
Trustee relating to or affecting the Company at any
time prior to or during the currency of any
Transaction Document, whether prejudicial or not to
the rights and liabilities of the Company and
whether or not the Security Trustee was under any
duty of disclosure; or
(xix) the Security Trustee entering into a covenant with
the Company not to sue, issue process, sign or
execute judgment, commence proceedings for
bankruptcy or liquidation, participate in any
scheme of arrangement or reconstruction, prove in
any bankruptcy or liquidation or do any other act,
matter or thing in respect of the liability of the
Company.
12.5 RELEASE OF CHARGED PROPERTY
The Security Trustee will be under no obligation to grant a release
of the Charged Property from the Charge unless at the time release
is to be provided, none of the Secured Money is owing (whether
actually, contingently or prospectively), none of the Obligations
remain to be performed and it is not reasonably foreseeable that
there could be any such money owing or Obligations to be performed
at a future time.
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13. PROTECTION AND INDEMNITY
13.1 WAIVER BY THE COMPANY
The Company waives in favour of the Security Trustee:
(a) all rights against the Security Trustee and any other
person, estate or assets as far as is necessary to give
effect to any provision of the Charge;
(b) promptness and diligence on the part of the Security
Trustee, and any other requirement that the Security
Trustee take any action or exhaust any right against any
other person before enforcing the Charge; and
(c) all rights inconsistent with the provisions of the Charge,
including any rights of contribution or subrogation which
that Company might otherwise be entitled to claim or
enforce.
13.2 NO LIABILITY FOR LOSS
Neither the Security Trustee nor any Receiver will be liable or
otherwise accountable for any omission, delay or mistake, or any
loss or irregularity in or about the exercise, attempted exercise,
non-exercise or purported exercise of any Power, except for actual
fraud or wilful misconduct.
13.3 NO LIABILITY TO ACCOUNT
Neither the Security Trustee nor any Receiver will, by reason of
the Security Trustee or the Receiver entering into possession of
the whole or part of the Charged Property, be liable to account as
mortgagee or chargee in possession, or for anything except actual
receipts, or be liable for any loss on realisation or for any
default, omission, delay or mistake for which a mortgagee or
chargee in possession might be liable.
13.4 NO CONFLICT
The Security Trustee and any Receiver may exercise any Power
notwithstanding that the exercise of that Power involves a conflict
between any duty owed to the Company by the Security Trustee or
that Receiver and any duty owed by the Security Trustee or Receiver
to any other person, or the interests of the Security Trustee or
Receiver. No contract will be void or voidable by virtue of any
such conflict of duty or interest, nor will the Security Trustee or
Receiver be liable to account to the Company or any other person
for any money or property as a result of such conflict.
13.5 NO NOTICE OR ENFORCEMENT
The Security Trustee need not give any notice of the security
created by the Charge to any debtor of the Company, or to any
purchaser, or to any other person, or to enforce payment
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of any money payable to the Company, or realise any of the Charged
Property, or to take any steps or proceedings for that purpose.
13.6 INDEMNITY
The Company will on demand indemnify and keep the Security Trustee
indemnified in respect of all costs, expenses, liabilities and
losses incurred by the Security Trustee or the Receiver:
(a) in the exercise, attempted exercise or non-exercise of any
Power, including (without limitation) those consequent on
any mistake, oversight, error of judgment or want of
prudence on the part of the Security Trustee or the
Receiver, unless the same is due to actual fraud or wilful
misconduct;
(b) as a consequence of the occurrence of any Event of
Default;
(c) by reason of the Charge;
(d) in respect of any act or omission for which the Security
Trustee or the Receiver is exonerated by Part A of this
Deed; and
(e) by reason of the Security Trustee redeeming or taking a
transfer of any Encumbrance ranking in priority to or pari
passu with the Charge,
and the Company will defend all actions, proceedings claims or
demands brought by any person in relation to any matter the subject
of this indemnity.
13.7 PROTECTION OF PERSONS DEALING WITH THE SECURITY TRUSTEE
OR RECEIVER
No person acquiring any money or asset from or paying or handing
over any money or asset to or otherwise dealing with the Security
Trustee, the Receiver or any attorney appointed under this Deed, or
to whom is tendered for registration an instrument executed by the
Security Trustee, the Receiver or any attorney appointed under this
Deed will be:
(a) bound to inquire:
(i) whether any Event of Default has occurred;
(ii) whether any of the Secured Money is owing or
payable;
(iii) whether the Receiver or attorney has been properly
appointed;
(iv) as to the propriety or regularity of the exercise
or purported exercise of any Power; or
(v) as to any other matter or thing;
(b) affected by actual or constructive notice that any
transaction,
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document or other dealing is unnecessary or improper; or
(c) concerned to see to the application of any money or asset,
or be answerable or accountable for any loss or
misapplication,
and the irregular, improper or unnecessary exercise of any Power
will be, as regards the protection of any such person, deemed to be
authorised by the Company and valid.
14. PAYMENTS
14.1 CREDIT BALANCES OF OTHER ACCOUNTS
In determining the Secured Money, no credit need be allowed by the
Security Trustee or any Stockholder for any credit balance in any
joint or other account of the Company with either of them, or for
any other money owing by the Security Trustee or any Stockholder to
the Company.
14.2 PAYMENT OF INTEREST
The Company will pay interest on the Secured Money to the Security
Trustee or any Stockholder, in accordance with each Transaction
Document, and in the absence of any relevant provision, to the
Security Trustee at the Specified Rate calculated on daily balances
computed from the time or respective times when the money becomes
owing to, or is paid by, the Security Trustee or Stockholder.
Interest accrues daily, and is payable on the earlier of a demand
from the Security Trustee (made at the request of a Stockholder) or
the last Banking Day of each calendar month, whilst the Secured
Money remains outstanding.
14.3 CAPITALISATION OF INTEREST
The Security Trustee or Stockholder may capitalise any interest
which has become due and owing in accordance with any Transaction
Document or in the absence of any relevant provisions then at such
periods of not less than one calendar month and from such dates as
the Security Trustee or that Stockholder elects. The accumulation
of capitalised interest may continue until the Secured Money has
been paid in full notwithstanding any composition, compromise
judgment or order in respect of any person or any other thing.
14.4 MERGER
If the liability of the Company to pay to the Security Trustee or
any Stockholder any of the Secured Money becomes merged in any
judgment or order, the Company will, as an independent obligation,
pay interest at the rate which is the higher of that payable under
this Deed and that fixed by or payable under that judgment or
order.
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14.5 NO DEDUCTION FOR TAXES AND NO SET-OFF OR COUNTERCLAIM
Subject to any Transaction Document, all payments of Secured Money
by the Company to the Security Trustee or a Stockholder will be:
(a) free of any set-off or counterclaim; and
(b) subject to any Statute, without deduction or withholding
for any present or future Taxes.
14.6 CURRENCY CONVERSION AND INDEMNITY
(a) If any amount is required to be paid in a particular
currency and the Security Trustee receives payment in
another currency, then the Security Trustee may actually
or notionally convert the amount received into the
required currency at the spot rate which it is or
considers it would be able to obtain in the market at the
time following receipt when it sees fit to make such
conversion. The Company will only satisfy its obligation
to pay in the required currency to the extent of the
amount actually or notionally received after deducting the
costs of conversion.
(b) The Company agrees to indemnify the Security Trustee for
any deficiency which arises for any reason between the
amount actually received under any judgment, court or
tribunal order or distribution under any Insolvency
Provision which takes into account any currency conversion
rate and the amount which would be actually or notionally
received by the Security Trustee by applying the
conversion provided for in this clause.
PART B:
RELATIONSHIP BETWEEN THE TRUSTEE AND THE STOCKHOLDERS
15. THE TRUSTEE
15.1 RIGHTS AND SPECIFIC INDEMNITIES
The Security Trustee agrees to exercise the Powers and perform the
obligations which are delegated to or conferred on it by this Deed
or any Collateral Security. The Security Trustee has no obligations
except those expressly set out or referred to in this Deed.
15.2 ACTS OF SECURITY TRUSTEE BINDING
Any act, matter or thing done or document signed by the Security
Trustee acting properly within its Powers, duties and obligations
under this Deed will be binding on every Stockholder.
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15.3 GENERAL COVENANTS OF SECURITY TRUSTEE
Until it retires or is removed from office as Security Trustee of
the Security Trust, the Security Trustee will:
(a) (ACT AS SECURITY TRUSTEE): act continuously as trustee of
the Security Trust;
(b) (ACT HONESTLY ETC.): subject to the terms and conditions
of this Deed, act honestly and in good faith in the
performance of its duties and the exercise of its Powers;
(c) (NO CO-MINGLING): keep the Security Trust Fund separate
from all other assets, investments and other property of
the Security Trustee or any other person, including, but
not limited to, assets, investments or other property
vested in or held by the Security Trustee as trustee of
trusts other than the Security Trust;
(d) (FOLLOW INSTRUCTIONS): in the exercise of all its Powers,
act or refrain from acting in accordance with the
instructions (if any) of the Stockholders or where an
Extraordinary Resolution is contemplated under this Deed,
in accordance with that Extraordinary Resolution;
(e) (OBLIGATIONS UNDER SECURITIES): perform any obligations
incurred by it under the terms of any Transaction
Document;
(f) (KEEP BOOKS): keep and maintain proper and accurate books,
records and accounts in regard to the Security Trust Fund
and its duties under this Deed.
(g) (OBTAIN DOCUMENTS): ensure that all documents are provided
by or on behalf of the Company in accordance with the
terms of the Transaction Documents granted by the Company
to the Security Trustee, review the substance of such
documents to determine whether any Event of Default or
Potential Event of Default is subsisting and provide
copies of the same to the Stockholders; and
(h) (NOTIFICATION): promptly notify the Stockholders of any
proposal to vary, replace or terminate this Deed or to
replace the Security Trustee.
15.4 PROTECTION OF SECURITY TRUSTEE
In addition to any protections under any Statute or contained in
this Deed the Security Trustee will not be liable (except to the
extent that it is in breach of this Deed or has engaged in fraud,
negligence or wilful breach) to any Stockholder or the Company or
otherwise be responsible for:
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(a) (EXERCISE OF RIGHTS): any loss or damage occurring as a
result of its exercising, failing to exercise or
purporting to exercise any Power under any Transaction
Document; or
(b) (DEFAULT OF AGENTS): the default of any agent of the
Security Trustee, whether or not the employment or
appointment of the agent was necessary or expedient;
(c) (MISTAKE OR OMISSION): any mistake or omission made by the
Security Trustee;
(d) (ANY OTHER THING): any other matter or thing done in
relation to any Transaction Document;
(e) (INVALIDITY): the invalidity or unenforceability of any
Transaction Document;
(f) (DIRECTIONS OF STOCKHOLDERS): any action or omission of
the Security Trustee in accordance with or consistent with
an Extraordinary Resolution;
(g) (ACTING ON RESOLUTION): acting on any resolution
purporting to have been passed at any meeting of
Stockholders at which minutes were made and signed even
though it may subsequently be found that there was some
defect in the constitution of the meeting or the passing
of the resolution or that for any other reason the
resolution was not valid or binding on any of those
Stockholders whom it purports to bind or the Security
Trustee;
(h) (INQUIRY INTO TITLE): enquiring into or liable for any
defects or failure in the title of any person to property
Encumbered by that person under a Transaction Document,
whether such defects or failure might have been discovered
upon inquiry and remedied or not;
(i) (MONITORING COMPLIANCE): monitoring, investigating or
otherwise informing itself as to the Company's compliance
with any Transaction Document except as expressly provided
in this Deed;
(j) (NO OBLIGATION TO INFORM): except where expressly provided
in this Deed, informing the Stockholders of the occurrence
of an Event of Default or Potential Event of Default; and
(k) (NO LIABILITY FOR ACTS OF A RECEIVER): the acts or
omissions of a Receiver, but it will, to the extent of a
prudent security trustee, monitor the performance by the
Receiver of the Receiver's duties.
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15.5 POWERS OF SECURITY TRUSTEE
In addition to the provisions of any Statute and the other Powers
contained in this Deed:
(a) (DISCRETION IN REPRESENTING STOCKHOLDERS): subject to
clause 15.3 in representing the Stockholders, the Security
Trustee has an absolute discretion to act or to refrain
from acting and to commence, prosecute, vary or
discontinue, abandon, waive or compromise any action,
proceeding or claim on any terms or conditions as it
thinks is in the best interests of the Stockholders;
(b) (ACT ON ADVICE): the Security Trustee may, in relation to
this Deed or any Power, without liability for loss, rely
on (without further inquiry):
(i) the opinion, advice or information obtained by the
Security Trustee from any properly qualified
adviser of any kind appropriate to a particular
case (including without limitation any lawyer,
independent accountant, valuer or other expert)
whether or not the opinion, advice or information
is correct;
(ii) any documents, advice or other communication
supplied to it in accordance with any Transaction
Document if it appears on its face to be correct
and is believed by the Security Trustee to be
genuine and the Security Trustee has not received
notice to the contrary.
(c) (DELEGATION AND AGENTS): the Security Trustee may:
(i) employ and act through agents and attorneys; or
(ii) delegate its powers, discretions, duties or
obligations to any person as provided, whether
expressly or by implication, in any Transaction
Document,
and no person dealing with the Security Trustee is bound to
enquire as to the regularity or authority of such person or as
to whether the Security Trustee has the requisite power;
(d) (CONVENE MEETINGS): the Security Trustee may at any time
convene a meeting of Stockholders;
(e) (REPRESENT STOCKHOLDERS): the Security Trustee may at any
time either of the Security Trustee's own volition or
under any directions or in accordance with any policy
given or indicated by any meeting of Stockholders,
represent the Stockholders generally in any investigation,
negotiation, action, transaction or proceeding touching
the interests of the Stockholders generally in the affairs
of the
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Company, in the enforcement of the rights of the
Stockholders or the Security Trustee or as to the duties
of the Security Trustee or as to the liabilities of the
Company and in enforcing the rights of the Stockholders or
the Security Trustee by any demand, action or proceeding;
(f) (APPLY TO COURT FOR DIRECTION): the Security Trustee may
apply to the court for directions in relation to any
question, and assent to and approve of or oppose any
application to the court made by any Stockholder; and
(g) (POWER TO DETERMINE): the Security Trustee has full power
as between itself and the Stockholders to determine all
questions and matters of doubt arising in relation to any
of the provisions of this Deed and every such
determination will be conclusive and binding on the
Stockholders.
15.6 ADDITIONAL POWERS OF THE SECURITY TRUSTEE
The Powers conferred by this Deed on the Security Trustee are in
addition to any powers which may from time to time be vested in
trustees by law.
15.7 SECURITY TRUSTEE TO EXERCISE POWERS
Notwithstanding that the Security Trustee holds the benefit of the
Powers for the Stockholders, the Stockholders acknowledge that only
the Security Trustee or a Receiver appointed by the Security
Trustee may exercise the Powers.
15.8 GENERAL INDEMNITY
Without limiting the rights of indemnification given to the
Security Trustee by law and elsewhere in this Deed, the Security
Trustee and every Receiver, attorney, agent or other person
appointed by the Security Trustee under this Deed will be
indemnified by the Company in respect of all liabilities and costs,
charges and expenses properly incurred by any of them in the
performance and execution of the trusts contained in this Deed or
in the exercise or non exercise of any powers, authorities and
discretions vested in any of them under this Deed. This indemnity
does not apply where there has been a breach of trust, misconduct,
fraud or negligence on the part of the Security Trustee or any of
those other persons.
16. ENFORCEMENT OF SECURITIES
16.1 OBLIGATION TO CONVENE MEETING
If the Security Trustee becomes aware of the occurrence of an Event
of Default, it will, subject to clause 16.5, promptly notify the
Stockholders and convene a meeting of them in accordance with this
Deed, at which it will seek instructions from the Stockholders by
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way of an Extraordinary Resolution of the Stockholders regarding
the action it should take as a result of such Event of Default.
16.2 SECURITY TRUSTEE MAY REQUIRE AN INDEMNITY
The obligation of the Security Trustee to act in accordance with
the Extraordinary Resolution referred to in clause 16.1 is subject
to:
(a) this Deed; and
(b) if required by the Security Trustee (in its absolute
discretion) the receipt from the Stockholders of an
indemnity in a form reasonably satisfactory to the
Security Trustee (which may be by way of an Extraordinary
Resolution of the Stockholders) against all actions,
proceedings, claims and demands to which it may render
itself liable, any liability or loss which may arise and
all costs, charges, damages and expenses which it may
incur, in giving effect to an Extraordinary Resolution of
the Stockholders. No such indemnity will extend to cover
fraud, negligence or wilful breach on the part of the
Security Trustee.
16.3 NO OBLIGATION TO ENFORCE
Pending the receipt of instructions from the Stockholders as
contemplated by clause 16.1 and receipt of the indemnity (if
required) contemplated by clause 16.2, the Security Trustee will
not be bound to take any action under the Charge or any Collateral
Security or give any consent or waiver or make any determination
thereunder (including, without limiting the generality of the
foregoing, to appoint any Receiver or to declare the Charge or
Collateral Security enforceable or to take any other proceedings
referred to in that security).
16.4 NOTICE OF ENFORCEMENT
Immediately upon the Security Trustee notifying the Company that
the Charge or a Collateral Security is enforceable, the Security
Trustee will send a copy of that notice to the Stockholders.
16.5 IMMATERIAL WAIVERS
The Security Trustee may in the absence of a relevant Extraordinary
Resolution of Stockholders:
(a) on such terms and conditions as it may deem expedient;
(b) without the consent of the Stockholders; and
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(c) without prejudice to its rights or duties in respect of
any subsequent breach,
agree to any waiver or authorisation of any breach or proposed
breach of any of the terms and conditions of this Deed or any
Collateral Security which is not, in the opinion of the Security
Trustee, prejudicial to the interests of the Stockholders and may
determine that any event that would otherwise be a Potential Event
of Default or Event of Default will not be treated as such for the
purposes of this Deed and any Collateral Security.
17. TRUSTEE FEE
NOT USED.
18. TRUSTEE'S PERSONAL INTEREST
18.1 SECURITY TRUSTEE NOT PRECLUDED FROM BEING A STOCKHOLDER
Nothing in the Transaction Documents prohibits the Security Trustee
or any Related Body Corporate of the Security Trustee or any
directors or officers of the Security Trustee or any of its Related
Bodies Corporate (each a "SECURITY TRUSTEE GROUP MEMBER") from
being a Stockholder or a shareholder in the Company or in a
Stockholder or from acting in any representative capacity for such
a shareholder or Stockholder. In particular, any Security Trustee
Group Member may act on its own account or as administrator,
trustee, receiver, attorney or agent or in any other fiduciary or
professional capacity and its acting in such capacity is not deemed
a breach of the obligations arising out of the fiduciary
relationship between the Security Trustee and the Stockholders. Any
consideration received for so acting may be retained.
18.2 SECURITY TRUSTEE NOT PRECLUDED FROM CONTRACTING
The Security Trustee is not by reason of any fiduciary capacity,
including by its entering into this Deed, in any way precluded from
making any contracts or entering into any transactions with the
Company in the ordinary course of the business of the Security
Trustee or from undertaking any fiduciary or agency services for
the Company or for itself as Security Trustee.
19. REMOVAL, APPOINTMENT AND RESIGNATION OF TRUSTEE
19.1 REMOVAL
If:
(a) (DEFAULT): the Security Trustee defaults in:
(i) the payment of any money held by it under the Trust
in the manner required by this Deed; or
(ii) the observance or performance of any of its
material
46.
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obligations under this Deed and, if that default is
capable of rectification, it is not rectified
within 7 Banking Days of its occurrence;
(b) (INSOLVENT): an Insolvency Event occurs in relation to the
Security Trustee; or
(c) (EXTRAORDINARY RESOLUTION): an Extraordinary Resolution is
passed that the Security Trustee be removed from office,
the Stockholders may, subject to the following provisions of this
clause 19, by at least 7 Banking Days' written notice to the
Security Trustee remove the Security Trustee from office.
19.2 RETIREMENT OF SECURITY TRUSTEE
The Security Trustee may, subject to the following provisions of
this clause 19, retire at any time upon giving not less than 14
days' notice in writing to the Company and each Stockholder.
19.3 REMOVAL OR RETIREMENT NOT EFFECTIVE
No removal or retirement of the Security Trustee under this clause
19 is effective unless and until a new Security Trustee has
accepted the office of Security Trustee under clause 19.4.
19.4 APPOINTMENT OF NEW SECURITY TRUSTEE
(a) Subject to paragraph (b) of this clause 19.4, the power of
appointing a new Security Trustee is vested in the
Company.
(b) On the service of a notice under clause 19.1 (except where
clause 19.1(c) applies) or of a notice of retirement by
the Security Trustee under clause 19.2, the Company will
promptly procure the Security Trustee to convene a meeting
of the Stockholders for the purpose of proposing a
successor Security Trustee. The Company will exercise the
power of appointment conferred by clause 19.4(a) in
accordance with any resolution passed at such meeting.
19.5 ACCEPTANCE OF APPOINTMENT BY SUCCESSOR
(a) Every successor Security Trustee appointed in accordance
with this clause 19 will (at its own cost or at the cost
of the Company) execute and deliver to the Company and the
retiring Security Trustee, an instrument accepting such
appointment and do all other things reasonably within its
power to assume the obligations, duties and Powers of the
retiring Security Trustee under this Deed.
47.
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(b) Upon the resignation or removal of the retiring Security
Trustee, the successor Security Trustee becomes vested
with all the Powers, trusts and duties of the retiring
Security Trustee. Such vesting will not affect the rights
and obligations of the retiring Security Trustee arising
during its term as Security Trustee.
19.6 CO-OPERATION OF REMOVED OR RETIRING SECURITY TRUSTEE
The removed or retiring Security Trustee will:
(a) (DELIVER DOCUMENTS): execute and deliver any documents and
do every other thing reasonably within its power which is
necessary or desirable to effect the appointment of the
successor Security Trustee; and
(b) (DELIVER ASSETS): deliver and grant to the successor
Security Trustee:
(i) all assets of the Security Trust Fund, all
documents of title and other documents relating
thereto, and all computer and other records,
computer software, accounts and documents relating
to the Security Trust and which are in the
possession of or under control of the removed or
retiring Security Trustee; and
(ii) such access to the computer and other records,
computer software, accounts and documents which
belong to the removed or retiring Security Trustee
in its own right and which are necessary to carry
out the functions and to exercise the rights of the
successor Security Trustee.
20. MEETINGS OF STOCKHOLDERS
20.1 MEETINGS REGULATED BY THE MEETINGS PROCEDURES
The Meetings Procedures apply to all meetings and resolutions of
Stockholders.
20.2 EXTRAORDINARY RESOLUTIONS
In addition to all other powers specified in this Deed as
exercisable by Extraordinary Resolution, the Stockholders have the
following powers exercisable by Extraordinary Resolution:
(a) (SANCTION, RELEASE OR COMPROMISE): power to sanction any
release, modification, waiver, variation, moratorium or
compromise or any arrangement in respect of the rights of
the Stockholders or the Security Trustee against the
Company or against their assets;
48.
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(b) (WAIVER OF DEFAULT): power to give any sanction, assent,
release or waiver of any breach or default by the Company
under any of the provisions of this Deed or any Collateral
Security other than a default in respect of the payment of
any part of the Secured Money;
(c) (GIVE UP POSSESSION): power to authorise the Security
Trustee or any Receiver where it has entered into
possession of property Encumbered by the Charge or any
Collateral Security or any part thereof, to give up
possession of the same to the Company, either
unconditionally or upon any condition;
(d) (REMOVE SECURITY TRUSTEE): subject to the provisions of
this Deed, power to remove any Security Trustee and to
propose the appointment of or appoint a new Security
Trustee;
(e) (EXECUTION OF DOCUMENTS ETC.): power to authorise or
instruct the Security Trustee to execute any document or
agreement to give effect to any matter referred to in this
clause 20.2; and
(f) (INSTRUCT SECURITY TRUSTEE GENERALLY): power to instruct
the Security Trustee to take or refrain from taking such
action or do such things as the Security Trustee may
lawfully do under this Deed.
20.3 EXTRAORDINARY RESOLUTIONS BINDING
An Extraordinary Resolution (whether passed at a meeting duly
convened and held in accordance with this Deed or passed in writing
in accordance with clause 12 of the Meetings Procedures) is binding
upon all Stockholders, and the Stockholders and the Security
Trustee are bound to give effect to it. However:
(a) (CLASS OF STOCKHOLDERS AFFECTED): a resolution of all
Stockholders which affects a particular class of
Stockholders only, as opposed to the rights of
Stockholders generally, is not binding on the Stockholders
of that particular class unless the Stockholders of that
particular class have, by Extraordinary Resolution, agreed
to be bound by it;
(b) (PARTICULAR STOCKHOLDER AFFECTED): a resolution of all
Stockholders or of a class of Stockholders which affects a
particular Stockholder only, rather than the rights of all
Stockholders of the Stockholder's class generally, is not
binding on that Stockholder unless he has agreed to be
bound by it; and
(c) (RELEASE ON PART PAYMENT OF SECURED MONEY): no
Extraordinary Resolution which purports to have any of the
following effects upon any Secured Money is valid unless
agreed to by the Stockholder to whom those Secured Money
is owed:
49.
<PAGE> 500
(i) the release of any obligation to pay the Secured
Money; or
(ii) the alteration of any date upon which any part of
the Secured Money is payable or the amount of any
payment of any part of the Secured Money.
21. AMENDMENTS OF SECURITY TRUST
21.1 AMENDMENT BY SECURITY TRUSTEE
Subject to clauses 21.3 and 21.4, any provision of this Deed
(including this clause 21) or any Supplemental Trust Deed may be
varied or amended and any new provision inserted at any time by
deed made between the Company and the Security Trustee if that
variation, amendment or insertion is:
(a) (MANIFEST ERROR): to correct a manifest error or ambiguity
or is of a formal, technical or administrative nature
only; or
(b) (NOT PREJUDICIAL): in the opinion of the Security Trustee
neither prejudicial nor likely to be prejudicial to the
interests of the Stockholders as a whole and either:
(i) not prejudicial nor likely to be prejudicial to any
Stockholder; or
(ii) to the extent the variation, amendment or insertion
is or is likely to be prejudicial to the interests
of any Stockholder, consented to by that
Stockholder.
21.2 AMENDMENT BY EXTRAORDINARY RESOLUTION
Subject to clauses 21.3 and 21.4, the Security Trustee may, if
authorised to do so by the Company and an Extraordinary Resolution,
vary or amend this Deed as so authorised or directed.
21.3 SECURITY TRUSTEE NOT TO BENEFIT
Subject to the provisions of this Deed (including, but not limited
to, any right of indemnity), the Security Trustee is not entitled
to any interest in or benefit in or arising from the Security Trust
Fund by resulting trust or otherwise and any acts, determinations
or otherwise by the Security Trustee purporting to create such
interest or benefit are void.
21.4 EVIDENCE OF VARIATION
If a variation or amendment to this Deed is made under this clause
21, any person may rely upon a certificate from the Security
Trustee describing the variation and the certificate is deemed to
be conclusive evidence of the variation.
50.
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22. EXPENSES STAMP DUTIES AND REGISTRATION
22.1 EXPENSES
The Company on demand will reimburse the Security Trustee for and
keep the Security Trustee indemnified against all expenses,
including legal fees, costs and disbursements (on a solicitor/own
client basis) incurred by the Security Trustee in connection with:
(a) (PREPARATION): the preparation, negotiation and execution
of the Transaction Documents and any subsequent consent,
agreement, waiver, amendment to, or discharge of any of
them; and
(b) (ENFORCEMENT): the exercise, enforcement, preservation, or
attempted exercise, enforcement or preservation of any
rights under the Transaction Documents, including without
limitation any expenses incurred in the evaluation of any
matter of material concern to the Security Trustee or any
Stockholder.
The Company will bear the cost of its compliance with the
Transaction Documents.
22.2 STAMP DUTIES
(a) (PAYMENT OF ALL DUTIES): The Company will pay all stamp,
loan transaction, registration and similar Taxes,
including fines and penalties, financial institutions duty
and debits tax which may be payable to or required to be
paid by any appropriate authority, or determined to be
payable in connection with the execution, delivery,
performance or enforcement of this Deed, or any payment,
receipt or other transaction contemplated by this Deed.
(b) (INDEMNITY): The Company will indemnify the Security
Trustee against any loss or liability incurred or suffered
by it as a result of the delay or failure by the Company
to pay Taxes.
22.3 REGISTRATION
The Company will ensure that the Charge is registered in the manner
and within such time limits as may be prescribed by law to ensure
the full efficacy of the Charge as a security to the Security
Trustee in all relevant jurisdictions.
23. GOVERNING LAW AND JURISDICTION
23.1 GOVERNING LAW
This Deed is to be governed by and construed in accordance with the
laws of New South Wales.
51.
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23.2 JURISDICTION
(a) (ACCEPTANCE OF JURISDICTION): The Company irrevocably
submits to and accepts generally and unconditionally the
non-exclusive jurisdiction of the courts and appellate
courts of New South Wales with respect to any legal action
or proceedings which may be brought at any time relating
in any way to this Deed.
(b) (NO OBJECTION TO INCONVENIENT FORUM): The Company
irrevocably waives any objection it may now or in the
future have to the venue of any such action or
proceedings, and any claim it may now or in the future
have that action or proceeding has been brought in an
inconvenient forum.
24. MISCELLANEOUS
24.1 CONFIDENTIALITY
(a) Subject to clause 24.1(b) the Security Trustee and the
Stockholder will not disclose any confidential or
unpublished information or documents supplied by the
Company in connection with the Transaction Documents which
are specifically indicated by the Company to be
confidential.
(b) The Security Trustee and the Stockholder will be entitled
to disclose any confidential information or documents:
(i) to a Stockholder;
(ii) in any proceeding arising out of or in connection
with any Transaction Document to the extent that
such disclosure is deemed by that person necessary
to protect its interests;
(iii) if required to do so under a binding order of any
Government Authority or any procedure for discovery
in any proceedings;
(iv) if required to do so under any law or any
administrative guideline, directive, request or
policy whether or not having the force of law and,
if not having the force of law, the observance of
which is in accordance with the practice of
responsible trustees, bankers or financial
institutions;
(v) otherwise as required or permitted by any
Transaction Document;
(vi) to its legal advisers and its consultants as long
as it advises them of the confidential nature of the
information or documents or that nature is clear
from the circumstances of the disclosure;
(vii) to a proposed Stockholder or assignee or transferee
from a Stockholder with the prior written consent of
the Company
52.
<PAGE> 503
which consent will not unreasonably be withheld or
delayed and will be deemed to have been given if
not refused within 5 Banking Days of a request
therefor; or
(viii) with the prior Company's written consent.
(c) This clause 24.1 survives the termination of this Deed.
24.2 FURTHER ASSURANCE
The Company will, and will procure that, all persons having or
claiming any estate or interest in the whole or part of the Charged
Property from time to time and at all times after the date of this
Deed on the request of the Security Trustee and at the cost of the
Company, will make, do and execute or cause to be made, done and
executed all acts, deeds and assurances for:
(a) more satisfactorily securing to the Security Trustee the
payment of the Secured Money;
(b) assuring or more satisfactorily assuring the Charged
Property to the Security Trustee, or as the Security
Trustee may direct; or
(c) facilitating the exercise of any Power.
In particular, whenever requested to do so by the Security Trustee,
the Company will execute in favour of the Security Trustee legal
mortgages, transfers, assignments or other assurances of the whole
or any part of the Charged Property in terms acceptable to the
Security Trustee.
24.3 CERTIFICATE OF SECURITY TRUSTEE
A certificate in writing signed by an officer of the Security
Trustee certifying the amount payable by the Company to the
Security Trustee or stating any other act, matter or thing relating
to this Deed or any Transaction Document is conclusive and binding
on the Company in the absence of manifest error on the face of the
certificate.
24.4 NOTICES
Any notice or other communication served, given or made under or in
connection with this Deed or any Collateral Security to which the
Company is a party:
(a) must be in writing in order to be valid;
(b) is sufficient if executed by the party serving, giving or
making the same or on its behalf by any attorney,
director, secretary, other duly authorised officer or
solicitor of such party;
(c) will be deemed to have been duly served, given or made in
relation
53.
<PAGE> 504
to a party if it is delivered or posted by prepaid post to
the address, or sent by facsimile to the number of that
party set out in the Transaction Documents or notified in
writing by that party to the other parties from time to
time; and
(d) will be deemed to be given, served or made:
(i) (in the case of prepaid post) on the fifth day
after the date of posting;
(ii) (in the case of facsimile) on receipt of a
transmission report confirming successful
transmission; and
(iii) (in the case of delivery by hand) on delivery.
24.5 ASSIGNMENT
(a) (DEED BINDS ASSIGNS): This Deed will be binding on and
inure to the benefit of the Company, the Stockholders and
the Security Trustee and their respective successors and
assigns.
(b) (ASSIGNMENT BY THE COMPANY): Notwithstanding clause
24.5(a), the Company may not assign or transfer all or any
part of its rights or obligations under this Deed without
the prior written consent of the Security Trustee acting
on the instructions of all the Stockholders.
(c) (ASSIGNMENT BY STOCKHOLDER OF STOCK): No Stockholder may
assign all or part of its rights to any Stock. If a
Stockholder assigns all or a rateable part of its rights
to the indebtedness secured by this Deed it will notify
the Company which will (subject to clause 5.5) thereupon
issue new Stock Certificates to the assignee and if the
assignor has assigned all of its indebtedness it will
return the relevant Stock Certificate to the Company.
(d) (ASSIGNEE NOT RECOGNISED): The Security Trustee will be
under no obligation to recognise the interest of any
unregistered assignee from any Stockholder.
24.6 NO MERGER
Neither this Deed, any Collateral Security nor any of the Powers
will merge or prejudicially affect or be merged in or prejudicially
affected by and the Company's obligations under this Deed will not
in any way be abrogated or released by any other security, any
judgment or order, any contract, any cause of action or remedy, or
any other matter or thing now or hereafter existing in respect of
the Secured Money.
54.
<PAGE> 505
24.7 SEVERABILITY OF PROVISIONS
Any provision of a Transaction Document which is illegal, void or
unenforceable will be ineffective to the extent only of that
illegality, voidness or unenforceability without invalidating the
remaining provisions.
24.8 POWERS CUMULATIVE
Each Power is cumulative and in addition to each other Power
available to the Security Trustee or the Receiver.
24.9 WAIVER
A failure to exercise or enforce or a delay in exercising or
enforcing or the partial exercise or enforcement of any Power by
the Security Trustee will not in any way preclude, or operate as a
waiver of, any further exercise or enforcement of that or any other
Power.
24.10 CONSENTS
Any consent referred to in this Deed or any Collateral Security may
be given or withheld and may be given subject to any conditions, as
the Security Trustee thinks fit in its absolute discretion unless
this Deed expressly provides otherwise.
24.11 WRITTEN WAIVER AND CONSENT
Any waiver or consent given by the Security Trustee under this Deed
or any Collateral Security will only be effective and binding on
the Security Trustee if it is given or confirmed in writing.
24.12 TIME OF ESSENCE
Time is of the essence in respect of the Company's obligations
under this Deed or any Collateral Security.
24.13 MORATORIUM LEGISLATION
To the fullest extent permitted by law, the provisions of all
Statutes at any time operating directly or indirectly to lessen or
affect in favour of the Company any obligation under this Deed or
any Collateral Security, or to delay or otherwise prevent or
prejudicially affect the exercise of any Power, are expressly
waived, negatived and excluded.
24.14 BINDING ON EACH SIGNATORY
This Deed is binding on each of the signatories notwithstanding
that any one or more of the named parties does not execute this
Deed, that there is any invalidity, forgery or irregularity
touching any execution of this Deed, or that this Deed is or
becomes unenforceable, void or voidable against a named party.
55.
<PAGE> 506
24.15 COUNTERPARTS
This Deed may be executed in a number of counterparts, all of which
taken together will be deemed to constitute one and the same
document.
24.16 NO REPRESENTATION BY OR RELIANCE ON SECURITY TRUSTEE
The Company does not enter into this Deed or any Collateral
Security in reliance on or as a result of any representation,
promise, statement, conduct or inducement by or on behalf of the
Security Trustee, any Stockholder otherwise than as set out in the
Transaction Documents.
24.17 INDEPENDENT INVESTIGATION
Each Stockholder confirms that it has made and will continue to
make, independently and without reliance on the Security Trustee or
any other Stockholder and based on the documents and information
which it regards as appropriate, its own investigations into the
affairs of the Company and its own analysis and decisions whether
to take or not take action under any Transaction Document.
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SCHEDULE 1
MEETINGS PROCEDURES
1. CONVENING OF MEETINGS
1.1 A meeting of Stockholders:
(a) may be convened at any time by the Security Trustee; and
(b) will be convened by the Security Trustee:
(i) if requested to do so by the Company;
(ii) if requested to do so by a Stockholder or by
Stockholders holding not less than 10% of the
Principal Money.
1.2 Each meeting of Stockholders will be held at such time and place
as the Security Trustee approves.
2. NOTICE OF MEETINGS
2.1 The Security Trustee must give notice of a proposed meeting of
Stockholders to each Stockholder and the Company as follows:
(a) the notice must specify the day, time and place of the
meeting and the nature of each specific resolution (if
any) to be proposed at that meeting;
(b) the notice must be given 5 Banking Days in advance of the
meeting (inclusive of the day on which the notice is given
and of the day on which the meeting is held);
(c) the notice may be given to each recipient in any manner
provided in relation to that recipient under this Deed.
2.2 A meeting convened otherwise than in accordance with clause 2.1 is
deemed to be duly convened if it is so agreed by Stockholders
representing a quorum.
2.3 An accidental omission to give notice to, or the non-receipt of
notice by, any person entitled to such notice, does not invalidate
the proceedings at any meeting provided that a quorum is present.
3. CHAIRMAN
A person (who need not be a Stockholder and who may be a
representative of the Security Trustee) nominated in writing by the
Security Trustee is entitled to take the chair at every meeting of
Stockholders. If, however, no such nomination is made or the person
nominated is not present at the meeting within 15 minutes after the
time appointed for the
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meeting to be held, the Stockholders present may choose one of
their number to be chairman.
4. QUORUM
4.1 At any meeting of Stockholders any 2 or more persons present in
person being Stockholders holding, or Representatives holding or
representing, in aggregate not less than 50% of the Principal Money
will form a quorum for the transaction of business and no business
(other than the choosing of a chairman) may be transacted at any
meeting unless the requisite quorum is present at the commencement
of business.
5. ADJOURNMENT
5.1 If within 15 minutes from the time appointed for any meeting of
Stockholders a quorum is not present then:
(a) if convened upon the requisition of Stockholders, the
meeting will be dissolved; and
(b) in any other case the meeting will stand adjourned (unless
the Security Trustee agrees that it be dissolved) for such
period, not being less than 5 days nor more than 30
Banking Days, as may be appointed by the chairman.
5.2 The chairman may with the consent of (and must if directed by) any
meeting adjourn the same from time to time and from place to place
but no business may be transacted at any adjourned meeting except
business which might lawfully have been transacted at the meeting
from which the adjournment took place.
5.3 At least 5 Banking Days' notice of any meeting adjourned through
want of a quorum must be given in the same manner as an original
meeting. That notice need not contain any further information
regarding the adjourned meeting.
6. VOTING PROCEDURE
6.1 Every question submitted to a meeting will be decided in the first
instance by a show of hands.
6.2 In case of equality of votes the chairman has, both on a show of
hands and on a poll, a casting vote in addition to the vote or
votes (if any) to which he may be entitled as a Stockholder or
as a Representative.
6.3 Unless a poll is (before or on the declaration of the result of the
show of hands) demanded by the chairman, the Company or the
Security Trustee or by one or more persons being Stockholders
holding, or Representatives holding or representing, in aggregate,
not less than 2% of the Principal Money, a declaration by the
chairman that a resolution has been carried by a particular
majority or lost or not carried by any particular majority is
conclusive evidence of the fact without proof of the number or
proportion of the votes
58.
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recorded in favour of or against such resolution.
6.4 If a poll is demanded, it must be taken in such manner and (subject
to clause 6.5) either at once or after such an adjournment as the
chairman directs and the result of such poll is deemed to be the
resolution of the meeting at which the poll was demanded as at the
date of the taking of the poll. The demand for a poll will not
prevent the continuance of the meeting for the transaction of any
business other than the question on which the poll has been
demanded.
6.5 Any poll demanded at any meeting on the election of a chairman or
on any question of adjournment will be taken at the meeting without
adjournment.
6.6 Subject to the chairman's casting vote under clause 6.2:
(a) on a show of hands every person present being a Stockholder, or
a Representative holding or representing a Shareholder, has one
vote;
(b) subject to clause 6.7, on a poll every person present being a
Stockholder or a Representative has one vote for each
Australian dollar (but not part thereof) of the Principal Money
(assessed as at the date of the notice of meeting issued under
clause 2.1 in respect of the meeting) that he holds or in
respect of which he is a Representative; and
(c) any person entitled to more than one vote need not:
(i) use all their votes; or
(ii) cast all their votes in the same way.
7. RIGHT TO ATTEND AND SPEAK
The Company and the Security Trustee (through their respective
representatives) and their respective financial and legal advisers
are entitled to attend and speak at any meeting of Stockholders. No
other person is entitled to attend or vote at any meeting of the
Stockholders.
8. APPOINTMENT OF PROXIES
8.1 Each appointment of a proxy:
(a) must be in writing;
(b) if so required by the Security Trustee must be accompanied by
proof satisfactory to the Security Trustee of its due
execution; and
(c) must be deposited with the Security Trustee not less than 24
hours before the time appointed for holding the meeting or
adjourned meeting at which the named proxy proposes to vote.
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In default, the appointment of proxy is not valid unless the
chairman of the meeting decides otherwise before such meeting or
adjourned meeting proceeds to business.
8.2 The proxy named in any appointment of proxy need not be a
Stockholder.
8.3 The Security Trustee is not obliged to investigate or be concerned
with the validity of, or the authority of, the proxy named in any
appointment of proxy.
8.4 Any vote cast in accordance with the terms of an appointment of
proxy conforming with clause 8.1 is valid notwithstanding the
previous revocation or amendment of the appointment of proxy or of
any of the Stockholder's instructions under which it was executed,
provided that no intimation in writing of such revocation or
amendment is received by the Security Trustee or by the chairman of
the meeting not less than 24 hours before the commencement of the
meeting or adjourned meeting at which the appointment of proxy is
used.
9. APPOINTMENT OF CORPORATE REPRESENTATIVES
A person authorised under sections 249(3)-(6) of the Corporations
Law by a Stockholder being a body corporate to act for it at any
meeting will, in accordance with their authority until their
authority is revoked by the body corporate concerned, be entitled
to exercise the same powers on behalf of that body corporate as
that body corporate could exercise if it were an individual
Stockholder and will be entitled to produce evidence of their
authority to act at any time before the time appointed for the
holding of or at the meeting or adjourned meeting or for the taking
of a poll at which they propose to vote.
10. RIGHTS OF REPRESENTATIVES
A Representative of a Stockholder will have the right to demand or
join in demanding a poll and will (except and to the extent to
which the Representative is specially directed to vote for or
against any proposal) have power generally to act at a meeting for
the Stockholder.
11. MINUTES AND RECORDS
11.1 Minutes of all resolutions and proceedings at every meeting of
Stockholders will be made and duly entered in the books provided
for that purpose by the Security Trustee.
11.2 Minutes of meetings of Stockholders if purporting to be signed by
the chairman of that meeting or by the chairman of the next
succeeding meeting of Stockholders are conclusive evidence of the
matters therein contained and until the contrary is proved every
such meeting of which minutes have been made and signed as
aforesaid is deemed to have been duly convened and held and all
resolutions passed or proceedings transacted at that meeting are
deemed to have been duly passed and transacted.
12. WRITTEN RESOLUTIONS
60.
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Notwithstanding the preceding provisions of these Meetings
Procedures, a resolution of all the Stockholders (including an
Extraordinary Resolution) may be passed, without any meeting or
previous notice being required, by an instrument or instruments in
writing which is or are signed by all the Stockholders. Any such
instrument or instruments are effective upon presentation to the
Security Trustee for entry in the records referred to in clause 11.
13. FURTHER PROCEDURES FOR MEETINGS
Subject to all other provisions contained in these Meetings
Procedures, the Security Trustee may without the consent of the
Stockholders prescribe such further regulations regarding the
holding of meetings of the Stockholders and attendance and voting
at those meetings as the Security Trustee may in its sole
discretion determine, including, but not limited to, such
regulations and requirements as the Security Trustee thinks
reasonable:
(a) to satisfy itself that persons are in fact Stockholders who
purport to requisition a meeting or who purport to make any
requisition to the Security Trustee in accordance with this
Deed;
(b) to satisfy itself that persons who purport to attend or vote at
any meeting of Stockholders are entitled to do so in accordance
with these Meetings Procedures; and
(c) as to the form of appointment of a Representative.
14. MEETINGS AND RESOLUTIONS OF CLASSES OF STOCKHOLDERS
The preceding provisions of these Meetings Procedures apply in all
respects, with the necessary modifications, to meetings and
resolutions of any class of Stockholders. For that purpose a
reference in the preceding provisions to "Stockholders" is a
reference to Stockholders of that class of Stockholders and a
reference to "Principal Money" is a reference to Principal Money
owed to that class of Stockholders.
61.
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SCHEDULE 2
APPLICATION FOR STOCK CERTIFICATE
[Date]
Principal Healthcare Finance Pty Limited
("COMPANY")
and
ABN AMRO Facilities Australia Limited
("SECURITY TRUSTEE")
APPLICATION FOR DEBENTURE STOCK
We refer to the Debenture Stock Trust Deed dated [ ] 1998
between the Company and the Security Trustee ("TRUST DEED").
We hereby apply for the issue of [1] Stock Certificate having a Face Amount
of $[ ].
We enclose a cheque for that amount.
We covenant for the benefit of the Company and the Security Trustee to be bound
by the provisions of the Trust Deed.
Our address is: [ ]
(Execution by Stockholder)
62.
<PAGE> 513
SCHEDULE 3
ACCEPTANCE OF APPLICATION FOR STOCK CERTIFICATE
[Name of Applicant]
Acceptance of Application for Debenture Stock: Principal Healthcare
Ongoing Security Trust
Subject to the terms of the Debenture Stock Trust Deed, we accept
your application of [ ] for one stock certificate in the above Trust with a Face
Amount of $[ ] and we will forward the debenture stock certificate to the
address shown in your application shortly.
[Execution by Company]
63.
<PAGE> 514
SCHEDULE 4
FORM OF STOCK CERTIFICATE
DEBENTURE STOCK CERTIFICATE
<TABLE>
<CAPTION>
FACE AMOUNT
STOCKHOLDER NAME AND OF STOCK CERTIFICATE DATE
NUMBER ADDRESS REGISTERED NUMBER ISSUED
<S> <C> <C> <C> <C>
- -------------------------------------------------------------------------------------------------------------------
</TABLE>
DEBENTURE STOCK constituted and secured by the Debenture Stock Trust Deed dated
[ ] made between [ ] and [ ] (as security trustee) ("DEBENTURE STOCK TRUST
DEED") and issued with the benefit of and subject to the provisions of that
Debenture Stock Trust Deed and the conditions contained in this Certificate.
Terms defined in the Debenture Stock Trust Deed have the same meaning when used
in this Certificate.
THIS IS TO CERTIFY that:
(a) the person whose name and address is set out above is the
registered holder of such amount of the abovementioned Stock as is
above stated but subject to any endorsements hereon;
(b) the Company acknowledges its indebtedness to the Stockholder in
respect of the Face Amount and promises to pay to the Stockholder
on the Maturity Date or such earlier date as the Face Amount may
become payable in accordance with the Trust Deed, the Face Amount
together with any accrued interest on the Face Amount on
presentation and surrender of this Stock Certificate at the
registered office of the Company;
(c) interest will accrue on the Face Amount at the rate of 10% per year
and, unless otherwise agreed in the Transaction Document, will be
payable on the 31st day of the month of December in each year until
the date of redemption (or if that day is not a Business Day, on
the next day which is a Business Day) and on the date of
redemption, to the account specified by the Stockholder to the
Company from time to time;
(d) the Company will make all payments in relation to the Stock in
immediately available
64.
<PAGE> 515
funds without set-off or counterclaim and without deduction for
Taxes or otherwise;
(e) the Stock is only redeemable after payment in full of the Secured
Money (other than the Face Amount of this Stock Certificate):
(f) the Stock may not be assigned or transferred;
(g) the Company warrants that the warranties in clause 6 of the Trust
Deed are true and correct as at the date of this Certificate as if
made on such date;
(h) in this Certificate "Maturity Date" means the date of payment and
discharge in full of all the Secured Money owing to the Stockholder
(other than the Face Amount of this Stock Certificate);
(i) if any Stock Certificate is worn out or defaced then upon its
production to the Company, the Company may cancel it and may issue
a new Stock Certificate in its place;
(j) if:
(i) any Stock Certificate is lost or if the Company does
not receive satisfactory proof of destruction of a
Stock Certificate; and
(ii) the Company receives an undertaking and/or security on
terms as to evidence and indemnity and the payment of
out-of-pocket expenses of the Company in investigating
evidence as the Issuer requires,
the Company will issue a new Stock Certificate to the person
entitled to the lost or destroyed Stock Certificate;
(k) an entry as to the issue of the new Stock Certificate and indemnity
(if any) will be made in the Register. The new Stock Certificate
will indicate that it is issued as a replacement certificate.
The Company and the Security Trustee agree that the following document(s) are
"Transaction Documents" as defined in and for the purposes of the Debenture
Stock Trust Deed:
[Specify Transaction Documents]
(Execution by the Company in a manner permitted by Trust Deed).
(Endorsement by the Security Trustee).
Date: [ ]
65.
<PAGE> 516
EXECUTED as a deed. )
SIGNED SEALED AND DELIVERED )
for and on behalf of PRINCIPAL )
HEALTHCARE FINANCE PTY ) ...................................
LIMITED ACN 069 875 476 by ) (Signature)
its Attorney under a Power )
of Attorney dated and )
who declares that he has not )
received any notice of the )
revocation of such Power of )
Attorney in the presence of: )
........................................
(Signature of Witness)
........................................
(Name of Witness in Full)
SIGNED SEALED AND DELIVERED for )
and on behalf of ABN AMRO )
FACILITIES AUSTRALIA LIMI ) ...................................
by ) (Signature of Witness)
)
its Attorney under a Power )
of Attorney dated and )
who declares that he has not )
received any notice of the )
revocation of such Power of )
Attorney in the presence of: )
........................................
(Name of Witness in Full) )
........................................
(Signature)
66.
<PAGE> 517
TABLE OF CONTENTS
<TABLE>
<CAPTION>
CLAUSE PAGE
<S> <C> <C>
1. DEFINITIONS AND INTERPRETATION 1
1.1 DEFINITIONS 1
1.2 INTERPRETATION 9
1.3 RIGHTS OF STOCKHOLDERS 10
1.4 STOCKHOLDERS OBLIGATIONS 10
1.5 SECURITY TRUSTEE 11
1.6 DETERMINATION OF PROPORTIONATE SHARE WITH RESPECT TO FOREIGN CURRENCY
AMOUNTS 11
1.7 ASCERTAINMENT OF PRINCIPAL MONEY 11
PART A:
THE CHARGE AND THE TRUST 12
2. CHARGE AND TRUST 12
2.1 THE CHARGE 12
2.2 THE TRUST 12
2.3 STOCKHOLDER'S ENTITLEMENT 12
2.4 DETERMINATION OF TRUST 13
2A. RELEASE OF CHARGE 13
3. NATURE OF CHARGE 13
3.1 ASSETS OVER WHICH THE CHARGE IS FIXED 13
3.2 DEALING WITH PROPERTY SUBJECT TO FLOATING CHARGE 14
3.3 AUTOMATIC CRYSTALLISATION OF FLOATING CHARGE 14
3.4 NOTICE OF CONVERSION 14
3.5 RECONVERSION 14
3.6 PROSPECTIVE LIABILITY 14
3.7 CONVERSION TO LEGAL MORTGAGE 14
4. INDEBTEDNESS 15
4.1 ACKNOWLEDGEMENT 15
4.2 PAYMENT 15
4.3 SATISFACTION 15
5. CREATION, ISSUE AND REGISTRATION OF STOCK 15
5.1 ISSUE OF STOCK 15
5.2 MONEY SECURED 15
5.3 CONDITIONS OF ISSUE OF STOCK 15
</TABLE>
(i)
<PAGE> 518
TABLE OF CONTENTS
<TABLE>
<CAPTION>
CLAUSE PAGE
<S> <C> <C>
5.4 NOTIFICATION OF SECURITY TRUSTEE 16
5.5 SECURITY TRUSTEE'S CONSENT TO ISSUE STOCK 16
5.6 ISSUE AFTER ENFORCEMENT OF CHARGE 16
5.7 CANCELLATION 16
5.8 SUPPLEMENTAL TRUST DEEDS 16
5.9 PRIORITY 17
5.10 REGISTER 17
5.11 BRANCH REGISTER 17
5.12 CERTIFICATES 17
5.13 CONDITIONS OF ISSUE 18
5.14 EXECUTION OF CERTIFICATES 18
5.15 REGISTER CONCLUSIVE 18
5.16 REGISTER AVAILABLE FOR INSPECTION 18
5.17 INVITATION TO SUBSCRIBE 18
5.18 SUBSCRIPTION FOR STOCK 18
5.19 TRANSACTION DOCUMENT 18
6. REPRESENTATIONS AND WARRANTIES 19
6.1 GENERAL REPRESENTATIONS AND WARRANTIES 19
6.2 CORPORATE REPRESENTATIONS AND WARRANTIES 19
6.3 TRUST REPRESENTATIONS AND WARRANTIES 20
6.4 REPRESENTATIONS AND WARRANTIES REPEATED 21
7. COVENANTS CONCERNING THE CHARGED PROPERTY 21
7.1 RESTRICTIONS IN RELATION TO THE CHARGED PROPERTY 21
7.2 INSPECTION 22
7.3 PROTECTION OF CHARGED PROPERTY 22
7.4 CONDUCT OF BUSINESS 22
7.5 INTELLECTUAL PROPERTY 22
7.6 LICENCES 22
7.7 SECURITY TRUSTEE ASSUMES NO OBLIGATIONS 23
7.8 DOCUMENTS OF TITLE AND OTHER SECURITIES 23
7.9 POSTPONEMENT OR WAIVER OF ENCUMBRANCES 23
8. EVENTS OF DEFAULT 23
9. RECEIVERS: APPOINTMENT AND POWERS 24
9.1 APPOINTMENT OF RECEIVER 24
9.2 JOINT RECEIVERS 24
9.3 REMUNERATION OF RECEIVER 24
9.4 AGENT OF THE COMPANY 24
</TABLE>
(ii)
<PAGE> 519
TABLE OF CONTENTS
<TABLE>
<CAPTION>
CLAUSE PAGE
<S> <C> <C>
9.5 POWERS OF RECEIVER 24
9.6 INDEMNITY 27
10. SECURITY TRUSTEE'S POWERS 27
10.1 EXERCISE OF POWER 27
10.2 ACT JOINTLY 28
10.3 POWER OF ATTORNEY 28
10.4 SECURITY TRUSTEE MAY MAKE GOOD DEFAULT 28
10.5 NOTICE FOR EXERCISE OF POWERS 28
11. APPLICATION OF MONEY 29
11.1 PRIORITY OF PAYMENTS 29
11.2 CONTINGENT INDEBTEDNESS 29
11.3 MONEY RECEIVED 30
11.4 APPLICATION OF PAYMENTS OR CREDITS 30
11.5 RELIANCE ON CERTIFICATE 30
12. LIABILITY AND RELEASE 30
12.1 CONTINUING OBLIGATION 30
12.2 PERSONAL LIABILITY 30
12.3 SETTLEMENT CONDITIONAL 30
12.4 COMPANY'S LIABILITY NOT AFFECTED 31
12.5 RELEASE OF CHARGED PROPERTY 32
13. PROTECTION AND INDEMNITY 33
13.1 WAIVER BY THE COMPANY 33
13.2 NO LIABILITY FOR LOSS 33
13.3 NO LIABILITY TO ACCOUNT 33
13.4 NO CONFLICT 33
13.5 NO NOTICE OR ENFORCEMENT 33
13.6 INDEMNITY 34
13.7 PROTECTION OF PERSONS DEALING WITH THE SECURITY TRUSTEE OR RECEIVER 34
14. PAYMENTS 35
14.1 CREDIT BALANCES OF OTHER ACCOUNTS 35
14.2 PAYMENT OF INTEREST 35
14.3 CAPITALISATION OF INTEREST 35
14.4 MERGER 35
14.5 NO DEDUCTION FOR TAXES AND NO SET-OFF OR COUNTERCLAIM 35
</TABLE>
(iii)
<PAGE> 520
TABLE OF CONTENTS
<TABLE>
<CAPTION>
CLAUSE PAGE
<S> <C> <C>
14.6 CURRENCY CONVERSION AND INDEMNITY 35
PART B:
RELATIONSHIP BETWEEN THE TRUSTEE AND THE STOCKHOLDERS
36
15. THE TRUSTEE 36
15.1 RIGHTS AND SPECIFIC INDEMNITIES 36
15.2 ACTS OF SECURITY TRUSTEE BINDING 36
15.3 GENERAL COVENANTS OF SECURITY TRUSTEE 36
15.4 PROTECTION OF SECURITY TRUSTEE 37
15.5 POWERS OF SECURITY TRUSTEE 38
15.6 ADDITIONAL POWERS OF THE SECURITY TRUSTEE 39
15.7 SECURITY TRUSTEE TO EXERCISE POWERS 39
15.8 GENERAL INDEMNITY 39
16. ENFORCEMENT OF SECURITIES 40
16.1 OBLIGATION TO CONVENE MEETING 40
16.2 SECURITY TRUSTEE MAY REQUIRE AN INDEMNITY 40
16.3 NO OBLIGATION TO ENFORCE 40
16.4 NOTICE OF ENFORCEMENT 40
16.5 IMMATERIAL WAIVERS 40
17. TRUSTEE FEE 41
18. TRUSTEE'S PERSONAL INTEREST 41
18.1 SECURITY TRUSTEE NOT PRECLUDED FROM BEING A STOCKHOLDER 41
18.2 SECURITY TRUSTEE NOT PRECLUDED FROM CONTRACTING 41
19. REMOVAL, APPOINTMENT AND RESIGNATION OF TRUSTEE 41
19.1 REMOVAL 41
19.2 RETIREMENT OF SECURITY TRUSTEE 42
19.3 REMOVAL OR RETIREMENT NOT EFFECTIVE 42
19.4 APPOINTMENT OF NEW SECURITY TRUSTEE 42
19.5 ACCEPTANCE OF APPOINTMENT BY SUCCESSOR 42
19.6 CO-OPERATION OF REMOVED OR RETIRING SECURITY TRUSTEE 43
20. MEETINGS OF STOCKHOLDERS 43
20.1 MEETINGS REGULATED BY THE MEETINGS PROCEDURES 43
</TABLE>
(iv)
<PAGE> 521
TABLE OF CONTENTS
<TABLE>
<CAPTION>
CLAUSE PAGE
<S> <C> <C>
20.2 EXTRAORDINARY RESOLUTIONS 43
20.3 EXTRAORDINARY RESOLUTIONS BINDING 44
21. AMENDMENTS OF SECURITY TRUST 44
21.1 AMENDMENT BY SECURITY TRUSTEE 44
21.2 AMENDMENT BY EXTRAORDINARY RESOLUTION 45
21.3 SECURITY TRUSTEE NOT TO BENEFIT 45
21.4 EVIDENCE OF VARIATION 45
22. EXPENSES STAMP DUTIES AND REGISTRATION 45
22.1 EXPENSES 45
22.2 STAMP DUTIES 45
22.3 REGISTRATION 46
23. GOVERNING LAW AND JURISDICTION 46
23.1 GOVERNING LAW 46
23.2 JURISDICTION 46
24. MISCELLANEOUS 46
24.1 CONFIDENTIALITY 46
24.2 FURTHER ASSURANCE 47
24.3 CERTIFICATE OF SECURITY TRUSTEE 47
24.4 NOTICES 47
24.5 ASSIGNMENT 48
24.6 NO MERGER 48
24.7 SEVERABILITY OF PROVISIONS 49
24.8 POWERS CUMULATIVE 49
24.9 WAIVER 49
24.10 CONSENTS 49
24.11 WRITTEN WAIVER AND CONSENT 49
24.12 TIME OF ESSENCE 49
24.13 MORATORIUM LEGISLATION 49
24.14 BINDING ON EACH SIGNATORY 49
24.15 COUNTERPARTS 50
24.16 NO REPRESENTATION BY OR RELIANCE ON SECURITY TRUSTEE 50
24.17 INDEPENDENT INVESTIGATION 50
SCHEDULE 1 - MEETINGS PROCEDURES 51
SCHEDULE 2 - APPLICATION FOR STOCK CERTIFICATE 56
</TABLE>
(v)
<PAGE> 522
TABLE OF CONTENTS
<TABLE>
<CAPTION>
CLAUSE PAGE
<S> <C> <C>
SCHEDULE 3 - ACCEPTANCE OF APPLICATION FOR STOCK CERTIFICATE 57
SCHEDULE 4 - FORM OF STOCK CERTIFICATE 58
</TABLE>
(vi)
<PAGE> 523
DEBENTURE STOCK TRUST DEED
DATE:
PRINCIPAL HEALTHCARE FINANCE PTY LIMITED
Company
ABN AMRO FACILITIES AUSTRALIA LIMITED
Security Trustee
(vii)
<PAGE> 524
DEED OF CHARGE (NSW and VIC) made at on 1998
BETWEEN PRINCIPAL HEALTHCARE FINANCE PTY LIMITED, ACN 069 875 476 both in
its personal capacity and in its capacity as trustee of the PHF
Trust ("CHARGOR")
AND ABN AMRO FACILITIES AUSTRALIA LIMITED, ACN 001 035 543 as trustee
of the Premier Care Australia Security Trust ("SECURITY TRUSTEE")
THIS DEED PROVIDES
1. DEFINITIONS AND INTERPRETATION
1.1 DEFINITIONS
In this Charge words which are defined in the Debenture Stock Trust
Deed and which are not defined in this Charge have the same meaning
when used in this Charge and:
"ADMINISTRATOR EVENT" means either:
(a) an administrator is appointed to the Chargor; or
(b) a proposal is made by any person to appoint an administrator
to the Chargor.
"APPROVED AGED CARE ASSETS" means assets that the Chargor proposes
to acquire (or which have been acquired, as the context requires)
from Moran Health Care Group Pty Limited (or any of its Related
Bodies Corporate).
"ASSOCIATED RIGHTS" means, in relation to any property:
(a) all rights, powers and remedies of the Chargor for the
enforcement of such property; and
(b) all rights and powers of the Chargor to vary, repudiate,
rescind, avoid, waive any right under, or terminate any
agreement or arrangement relating to such property.
"BUSINESS" means the business conducted by the Chargor in
connection with the Approved Aged Care Assets, including the
acquisition or leasing of the Approved Aged Care Assets.
"CHARGED PROPERTY" means:
(a) the Leased Property; and
(b) all rights of the Chargor under the Moran Relationship
Agreement, any management contract entered into by the
Chargor as part of or in connection with the Business, the
Moran Lease, the Moran Guarantee and the Moran
1.
<PAGE> 525
Securities; and
(c) the Remaining Property,
but does not include the Excluded Property.
"DEBENTURE STOCK TRUST DEED" means the deed so entitled dated 17
June 1998 between the Chargor and the Security Trustee.
"EVENT OF CRYSTALLISATION" means each or any of the following
events:
(a) any breach of clause 4.1;
(b) any Encumbrance over any asset of the Chargor becomes
enforceable or any Encumbrance that is a floating security
over any asset of the Chargor crystallises or otherwise
becomes a fixed or specific security;
(c) any Insolvency Event occurs in relation to the Chargor;
(d) the Commissioner of Taxation, or its delegate, determines to
issue a notice under section 74 of the Sales Tax Assessment
Act 1992 or section 218 of the Income Tax Assessment Act
1936 for any amount due by the Chargor in respect of any Tax
under such Act or any fines and costs imposed on the Chargor
under such Act; and
(e) any other event that the Security Trustee has notified the
Chargor to be an Event of Crystallisation for the purposes
of this Charge.
"EXCLUDED PROPERTY" means any asset, property or undertaking
located in Queensland or Western Australia.
"FAI PROPERTY" means the charged property referred to in the
Original Debenture Stock Trust Deed.
"INITIAL UNITHOLDERS" means Metlife Australia (Holdings) Pty
Limited, ACN 070 667 417 and FAI Deposit Co. Pty Limited, ACN 008
647 489.
"INTELLECTUAL PROPERTY" means all patents, trademarks, copyrights,
registered designs, trade secrets, confidential information and
other intellectual property at any time held by or registered in
the name of the Chargor or which the Chargor at any time has the
benefit of, has an interest in or is entitled to use.
"LICENCE" means each licence, certificate, document, registration,
permission, privilege, permit, authority or consent which is issued
or held in connection with the Business, which is necessary or
desirable to be held by the Chargor in relation to the Business
including any variation or renewal thereof.
2.
<PAGE> 526
"LEASED PROPERTY" means:
(a) the Properties;
(b) each nursing home/residential care facility and any other
aged care or health care related facility currently or
subsequently operated on any Property;
(c) all plant and equipment fixed to any property referred to in
another paragraph of this definition; and
(d) all assets and chattels on the Properties (or any facility
referred to in paragraph (b)) and used in connection with
the Business on the date of commencement of the Moran Lease.
"MORAN GUARANTEE" means all of the present and future right, title
and interest of the Chargor in:
(a) the Lease Guarantee dated on or about the date of this
Charge between Moran Health Care Group Pty Limited and the
Chargor; and
(b) all Associated Rights in relation to and all proceeds
deriving from the Property referred to in paragraph (a).
"MORAN LEASE" means all of the present and future right, title and
interest of the Chargor in:
(a) the lease entered into by the Chargor with Moran Health Care
(Australia) Pty Limited in respect of the Properties on or
about the date of this Charge (as amended, varied, novated,
supplemented, ratified or replaced from time to time); and
(b) all Associated Rights in relation to and all proceeds
deriving from the property referred to in paragraph (a).
"MORAN RELATIONSHIP AGREEMENT" means the agreement entitled
"Relationship Agreement" between the Chargor, Moran Health Care
(Australia) Pty Limited and Moran Health Care Group Pty Limited
dated on or about the date of this Charge.
"MORAN SECURITIES" means all of the present and future right, title
and interest of the Chargor in:
(a) the Fixed and Floating Charge dated 19 June 1998
between the Chargor and Moran Health Care (Australia)
Pty Limited as trustee of the Moran Health Care
Australia Trust;
(b) the Mortgage of Units dated 19 June 1998 between the
Chargor and Moran Health Care Group Pty Limited; and
3.
<PAGE> 527
(c) the Mortgage of Shares dated 19 June 1998 between the
Chargor and Moran Health Care Group Pty Limited.
"ORIGINAL DEBENTURE STOCK TRUST DEED" means the Debenture Stock
Trust Deed dated 17 June 1998 between the Chargor and the Security
Trustee.
"PHF TRUST" means the trust known as the "Principal Healthcare
Finance Trust" (formerly known as the "Assisted Living Unit Trust")
constituted by the Trust Deed.
"POWER" means any right, power, authority, discretion, remedy or
privilege conferred on the Security Trustee, Receiver or any
attorney or agent appointed under this Charge, by any Transaction
Document, by Statute, or by law or equity in respect of this Charge
or any Collateral Security.
"PREMIER CARE AUSTRALIA SECURITY TRUST" means the trust constituted
by the Debenture Stock Trust Deed.
"PROPERTIES" means the properties listed in the Schedule.
"RECEIVER" means a receiver or receiver and manager appointed by
the Security Trustee under this Charge and if more than one, then
each of them, and also any servant, agent or delegate of any of
them.
"RELATED BODY CORPORATE" has the meaning given in section 9 of the
Corporations Law and refers to any corporation of that kind
whenever it becomes related.
"REMAINING PROPERTY" means all of the Chargor's assets,
undertakings and rights, both present and future, but excluding:
(a) the FAI Property; and
(b) the property referred to in paragraphs (a) and (b) of
the definition of "Charged Property".
"TRUST DEED" means the deed of trust dated 11 August 1995 between
the Chargor and the Initial Unitholders.
1.2 INTERPRETATION
In this Charge:
(a) headings are for convenience only and do not affect
interpretation;
and unless the context indicates a contrary intention:
(b) the expression "PERSON" includes an individual, the
estate of an
4.
<PAGE> 528
individual, a corporation, and a statutory or other
authority or association (incorporated or
unincorporated);
(c) a reference to any party includes that party's
executors, administrators, successors, substitutes and
assigns, including any person taking by way of novation
and in the case of a trustee includes any substituted
or additional trustee;
(d) a reference to the Charged Property includes any part
of it;
(e) a reference to this Charge, to a Transaction Document
or to any other document includes respectively this
Charge, the Transaction Document or that other document
as amended, varied, novated, supplemented, ratified or
replaced from time to time;
(f) a reference to any legislation or to any section or
provision thereof includes any statutory modification,
(g) re-write or re-enactment or any statutory provision
substituted therefor, and all ordinances, by-laws,
regulations and other statutory documents issued
thereunder;
(h) words importing the singular include the plural (and
vice versa) and words denoting a given gender include
all other genders;
(i) a reference to a clause is a reference to a clause of
this Charge;
(j) where any word or phrase is given a defined meaning,
any other part of speech or grammatical form in respect
of that word or phrase has a corresponding meaning;
(k) all accounting terms used in this Charge have the
meaning given under accounting principals and practices
generally accepted in Australia from time to time; and
(l) mentioning anything after "include", "includes" or
"including" does not limit what else may be included.
1.3 DEBENTURE STOCK TRUST DEED
(a) The Chargor and the Security Trustee acknowledge and
agree that this Charge are each a "Transaction
Document" as defined in and for the purposes of the
Debenture Stock Trust Deed.
(b) The Chargor and the Security Trustee agree that this
Charge is a "Collateral Security" as defined in and for
the purposes of the Debenture Stock Trust Deed.
5.
<PAGE> 529
(c) To the extent to which any provision of this Charge is
inconsistent with the Debenture Stock Trust Deed, the
Debenture Stock Trust Deed shall prevail.
1.4 SECURITY TRUSTEE
(a) Any reference to the "Security Trustee" in this Charge
will be construed as referring to the Security Trustee
as trustee for the Stockholders.
(b) As between the Chargor on the one hand and the Security
Trustee and the Stockholders on the other, all action
taken by the Security Trustee under this Charge will be
taken to be authorised and the Chargor need make no
enquiry as to the authority of the Security Trustee.
2. CHARGE
2.1 THE CHARGE
The Chargor both in its personal capacity and as trustee of the PHF
Trust hereby charges all the Charged Property to the Security
Trustee to secure the due and punctual performance, observance and
fulfilment of all the Obligations and the payment in full of the
Secured Money.
2.2 ASSETS OVER WHICH THIS CHARGE IS FIXED
This Charge will operate as a fixed charge over the Charged
Property listed below (whether present or future) which does not
form part of the Remaining Property:
(a) all real and leasehold property, and all fixtures and
improvements thereon;
(b) all machinery, vehicles, fittings, furniture, plant and
equipment, computer software and hardware;
(c) the Moran Guarantee, all rights of the Chargor under
any management contract in respect of the Business, the
Moran Lease and all other documents, contracts,
(including leases), rights and records relating to the
Business;
(d) the goodwill of the Business and all Licences;
(e) the Moran Securities and all other Encumbrances,
Marketable Securities, documents of title and
Intellectual Property,
with the intention that each item of future property described in
this clause 2.2 will be specifically charged to the Security
Trustee at the time it is acquired by the Chargor. This
6.
<PAGE> 530
Charge will operate as a floating charge as regards all other
Charged Property (including the Remaining Property).
2.3 DEALING WITH PROPERTY SUBJECT TO FLOATING CHARGE
Subject to any contrary provision in any Transaction Document, the
Chargor may in respect of any part of the Charged Property which is
subject to the floating charge created by this Charge, deal with
and pay or apply that part of the Charged Property in the ordinary
course of its ordinary business.
2.4 AUTOMATIC CRYSTALLISATION OF FLOATING CHARGE
(a) If any Event of Crystallisation occurs, the floating charge
created by this Charge will (except to the extent to which
this Charge is a floating charge over the Remaining
Property) at that time automatically crystallise and
immediately become a fixed charge over that part of the
Charged Property not immediately prior to such occurrence
the subject of the fixed charge.
(b) if an Administrator Event occurs the floating charge created
by this Charge will (to the extent to which this Charge is a
floating charge over the Remaining Property) at that time
automatically crystallise and immediately become a fixed
charge over the Remaining Property.
2.5 NOTICE OF CONVERSION
The Security Trustee may at any time by notice in writing to the
Chargor convert or reconvert its security under this Charge from
(except in the case of the Remaining Property) a floating charge to
a fixed charge or from a fixed charge to a floating charge. Any
such conversion will be effective from the moment of receipt of
notice of such conversion.
2.6 RECONVERSION
The Security Trustee may at any time by notice in writing to the
Chargor reconvert its security under this Charge from a fixed
charge to a floating charge in respect of any asset or class of
asset specified in that notice.
2.7 CONVERSION TO LEGAL MORTGAGE
If an Event of Default occurs and is not waived or remedied in the
period (if any) permitted in any Transaction Document, at any time
thereafter if such event continues the Security Trustee may procure
itself (or its nominee) to be registered as the holder of any
shares forming part of the Charged Property (other than any shares
forming part of the Remaining Property). Without limiting the
generality of the foregoing, the Chargor irrevocably and
unconditionally authorises the Security Trustee to date and
complete any transfers and lodge such transfers for stamping and
registration accompanied by the share certificates relating
thereto, if applicable. The Security Trustee's costs and expenses
7.
<PAGE> 531
relating to the transfer and registration, including stamp duty and
other taxes, will be payable by the Chargor on demand and will form
part of the Secured Money.
2.8 PROSPECTIVE LIABILITY
For the purpose only of section 282(3) of the Corporations Law, the
specified maximum amount of the prospective liability secured by
this Charge is $200,000,000. The nature of the prospective
liability is as shown on the notice lodged with this Charge with
the Australian Securities and Investments Commission. Nothing in
this clause 2.8 will limit, or put the Security Trustee under any
obligation to do any act or thing so as to increase, the amount of
the money secured by this Charge.
3. REPRESENTATIONS AND WARRANTIES
3.1 GENERAL REPRESENTATIONS AND WARRANTIES
The Chargor represents and warrants to the Security Trustee that:
(a) (GOOD TITLE): it has good right to charge the Charged
Property as beneficial owner in the manner provided in
this Charge and in each Collateral Security, and the
Charged Property is free of all Encumbrances;
(b) (LEGALLY BINDING OBLIGATION): this Charge constitutes a
valid and legally binding obligation of the Chargor in
accordance with its terms;
(c) (EXECUTION, DELIVERY AND PERFORMANCE): the execution,
delivery and performance of this Charge by the Chargor
does not violate any Statute or law, or any document or
agreement to which the Chargor is a party or which is
binding on it or any of its assets;
(d) (AUTHORISATION): all consents, licences, approvals and
authorisations of every Government Authority required
to be obtained by the Chargor in connection with the
execution, delivery and performance of this Charge have
been obtained and are valid and subsisting;
(e) (FINANCIAL LIABILITIES): the Chargor is not in default
in the payment of any material sum or in the
performance or observance of any material obligation in
respect of any Financial Liability, and no event has
occurred which with the giving of notice, lapse of time
or other condition could constitute a default in
respect of any Financial Liability;
(f) (NO EVENT OF DEFAULT): no event has occurred which
constitutes an Event of Default or a Potential Event of
Default;
(g) (STATUTES): the Chargor has not failed to comply with
any Statute
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relative to it or the Business where such failure may
have a material adverse effect on the Chargor's ability
to observe its obligations under the Transaction
Documents; and
(h) (NO TRUSTS): the Chargor is not the trustee of any
trust (other than the PHF Trust) nor does it hold any
property subject to or impressed by any trust (other
than the PHF Trust).
3.2 CORPORATE REPRESENTATIONS AND WARRANTIES
The Chargor further represents and warrants to the Security Trustee
that:
(a) (DUE INCORPORATION): it is duly incorporated and has
the corporate power to own its property and to carry
on its business as is now being conducted;
(b) (CONSTITUTION): the execution, delivery and
performance of this Charge does not violate the
Constitution of the Chargor;
(c) (CORPORATE POWER): it has the power, and has taken all
corporate and other action required, to enter into
this Charge and to authorise the execution and
delivery of this Charge and the performance of its
obligations under this Charge; and
(d) (FILINGS): the Chargor has filed all corporate notices
and effected all registrations with the Australian
Securities and Investments Commission and all of those
filings and registrations are current, complete and
accurate.
3.3 TRUST REPRESENTATIONS AND WARRANTIES
The Chargor further represents and warrants to the Security Trustee
that:
(a) (TRUSTEE): it enters, or has entered, into this Charge
in its capacity as trustee of the PHF Trust;
(b) (TRUST VALIDLY CREATED): the PHF Trust has been
validly created and is in existence at the date of
this Charge;
(c) (TRUSTEE VALIDLY APPOINTED): the Chargor has been
validly appointed as trustee of the PHF Trust and is
presently the sole trustee of the PHF Trust;
(d) (TRUST DEED): the PHF Trust is solely constituted by
the Trust Deed, (a true copy of which has been
provided to the Security Trustee or its agent before
the date of this Charge) and the Trust Deed discloses
all the terms of the PHF Trust other than terms
implied by law;
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(e) (TRUSTEE'S POWER): it has full and free power to enter
into this deed in its capacity as trustee of the PHF
Trust;
(f) (TRUST AUTHORISATIONS): it has in full force and
effect all authorisations necessary to enter into this
deed as trustee of the PHF Trust, and to perform its
obligations under them;
(g) (NO REMOVAL OF TRUSTEE): no action has been taken or
is proposed to remove it as trustee of the PHF Trust;
(h) (NO DEFAULT OF TRUSTEE): it is not in default under
the Trust Deed which would have the effect of limiting
or removing its right of indemnity from the property
of the PHF Trust, or would affect its power or ability
to enter into this deed (or to perform its obligations
under this deed) as trustee of the PHF Trust;
(i) (TRUST OBLIGATIONS): it has complied with its
obligations in connection with the PHF Trust;
(j) (VESTING DATE NOT DECLARED): a date has not been
declared pursuant to the Trust Deed as the date on
which the PHF Trust will be vested or come to an end,
and no other action has been taken or is proposed to
terminate the PHF Trust;
(k) (NO PROCEEDINGS): no proceedings of any description
have been or are likely to be commenced or threatened
which could have a material adverse effect on the
assets or financial position of the PHF Trust or on
its trusteeship thereof;
(l) (NO ACQUISITION OF TRUST ASSETS): it has not done, or
failed to do, any act whereby any of the assets of the
PHF Trust have been acquired by any other person and
no assets of the PHF Trust are presently registered in
the name of any other person and no person, other than
the Chargor and the beneficiaries of the PHF Trust
from time to time, has acquired any right of any kind
whether vested or contingent in any asset of the PHF
Trust;
(m) (INDEMNITY): it has a right to be fully indemnified
out of the property of the PHF Trust in respect of
obligations incurred by it under this Charge; and
(n) (COMMERCIAL BENEFIT): it is to the commercial benefit
of the PHF Trust that it enters into this Charge in
its capacity, inter alia, as trustee of the PHF Trust.
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3.4 REPRESENTATIONS AND WARRANTIES REPEATED
Each representation and warranty in this Charge will be repeated on
each day whilst any of the Secured Money remains outstanding
(whether or not then due for payment) with reference to the facts
and circumstances then subsisting, as if made on each such day.
4. COVENANTS CONCERNING THE CHARGED PROPERTY
4.1 RESTRICTIONS IN RELATION TO THE CHARGED PROPERTY
The Chargor will not without the Security Trustee's prior written
consent (which will not be unreasonably withheld):
(a) (NO ENCUMBRANCES): create, purport or attempt to create
or permit to exist any Encumbrance howsoever ranking
over any part of the Charged Property (other than the
Remaining Property).
(b) (NO SALE, LEASE ETC.): convey, assign, transfer, lease
or otherwise dispose or part with possession of, make
any bailment over, grant any option over or create or
permit to exist any other interest in any part of the
Charged Property whilst that part of the Charged
Property is subject to the fixed charge created in this
Charge or in any Collateral Security;
(c) (NOT TO PREJUDICE): do or permit any act, omission or
thing whereby any part of the Charged Property (other
than the Remaining Property) becomes or could be liable
to surrender, forfeiture or cancellation or becomes
prejudiced in any manner or the value of this Charge as
a security to the Security Trustee becomes or could be
materially lessened;
(d) (ORDINARY COURSE): subject to this Charge, deal with or
attempt to deal with the Charged Property other than in
the ordinary course of its ordinary business;
(e) (AMENDMENTS, ETC): amend, vary, terminate, cancel or
surrender any Moran Guarantee, any Moran Lease or any
Moran Security in any material respect; or
(f) (STEP): take any step towards doing any of these
things.
4.2 INSPECTION
The Chargor will following the occurrence of any Event of Default
(or if the Security Trustee suspects, on reasonable grounds, that
an Event of Default may have occurred) permit the Security Trustee
and any employee, agent or professional adviser of the Security
Trustee, to enter any land or buildings owned or occupied by the
Chargor or any Related
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Body Corporate of the Chargor (except to the extent to which they
form part of the Remaining Property), at all reasonable times,
without notice, to inspect its condition and to monitor compliance
with this Charge (so long as to do so will not cause the Chargor to
be in breach of any Statute or any lease of such land or
buildings).
4.3 PROTECTION OF CHARGED PROPERTY
At the request of the Security Trustee, the Chargor will take or
defend all legal proceedings that the Security Trustee considers
necessary or desirable for the preservation, protection or recovery
of all or any part of the Charged Property.
4.4 CONDUCT OF BUSINESS
The Chargor will carry on and conduct the Business in a proper and
efficient manner and will not change the general character of or
discontinue the Business without the Security Trustee's prior
written consent.
4.5 INTELLECTUAL PROPERTY
The Chargor will maintain and renew all its present and future
Intellectual Property.
4.6 LICENCES
The Chargor will:
(a) (APPLY): apply for (or procure the application for) and
use (or procure that the applicant uses) its best
endeavours to obtain and maintain each licence which is
not held in respect of the Business but which is
required by law to be held;
(b) (RENEW): on or before the time and in the manner
prescribed by the relevant Statute for each Licence,
apply for (or procure the application for) and procure
the renewal of each Licence, and pay or cause to be
paid the renewal fees and other sums required in
respect of the Licence or the renewal of the Licence
within the time allowed and in the manner prescribed by
the Statute;
(c) (PRODUCTION OF THE LICENCE): whenever reasonably
requested by the Security Trustee, produce to the
Security Trustee (or procure the production to the
Security Trustee of) each Licence and all receipts for
payments in relation to each Licence;
(d) (NO CANCELLATION): not do, allow or suffer any act,
matter or thing as a result of which any Licence is or
may be surrendered, forfeited, withdrawn, cancelled,
refused or rendered void, or whereby the holder of any
Licence is disqualified permanently or temporarily from
receiving or continuing to hold a Licence, or whereby
the Business
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<PAGE> 536
may be disqualified permanently or temporarily from
having a Licence; and
(e) (COMPLY WITH STATUTES): procure that the holder of any
Licence complies with all Statutes and all lawful
requirements of every Government Authority in relation
to the Licence (to the extent that such compliance is
necessary to ensure that the Licence is not revoked,
terminated or forfeited) or otherwise does all things
required of the holder.
4.7 SECURITY TRUSTEE ASSUMES NO OBLIGATIONS
The Security Trustee will not be deemed by virtue of this Charge to
have assumed any obligation of the Chargor under any Licence or
Statute.
4.8 DOCUMENTS OF TITLE AND OTHER SECURITIES
The Chargor will lodge with the Security Trustee all documents
relating to each Encumbrance under which the Chargor is the
Encumbrancee, all certificates, scrip and other indicia of the
Chargor's title or interest in any Marketable Securities, all
negotiable instruments other than cheques, all real estate leases,
and all other documents of title to the whole or part of the
Charged Property (other than the Remaining Property) immediately on
receipt of same.
4.9 POSTPONEMENT OR WAIVER OF ENCUMBRANCES
The Chargor will, if requested by the Security Trustee, immediately
cause:
(a) any Encumbrance which has arisen or which arises from
time to time by operation of law over the Charged
Property (other than the Remaining Property) in favour
of any person (including the Chargor) to be at the
Security Trustee's option postponed in all respects
after and subject to this Charge or to be otherwise
discharged, released or terminated; and
(b) any Financial Liability or other obligation secured by
any such Encumbrance at the Security Trustee's option
to be waived, released, paid or performed.
5. EVENTS OF DEFAULT
(a) If any Event of Default occurs and while it subsists at
the option of the Security Trustee and notwithstanding
any delay or previous waiver of the right to exercise
that option, all Powers not previously exercisable
become exercisable, and also at the like option of the
Security Trustee, the right of the Chargor to deal with
the Charged Property (other than the Remaining
Property) immediately ceases.
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<PAGE> 537
(b) If an Administrator Event occurs then, notwithstanding
any delay or previous waiver of the right to exercise
that option, all Powers in respect of the Remaining
Property not previously exercisable become exercisable
and also at the like option of the Security Trustee,
the right of the Chargor to deal with the Remaining
Property immediately ceases.
Nothing in this paragraph (b) limits paragraph (a) of
this clause 5 or any other provision of this Charge or
any other Transaction Document.
6. RECEIVERS: APPOINTMENT AND POWERS
6.1 APPOINTMENT OF RECEIVER
At any time after the happening of any Event of Default or after
the whole or part of the Secured Money becomes due and payable
under the provisions of this Charge, the Security Trustee may if
directed by an Extraordinary Resolution of Stockholders:
(a) appoint in writing any person or persons to be a
receiver or receiver and manager of the whole or part
of the Charged Property;
(b) withdraw the appointment of that Receiver as to the
whole or part of the Charged Property; and
(c) (in case of the removal, retirement or death of any
Receiver) appoint another person or persons in his
place,
PROVIDED THAT the Security Trustee may only exercise its rights and
powers under this clause 6.1 in respect of the Remaining Property
if an Administrator Event has occurred.
6.2 JOINT RECEIVERS
If more than one person is appointed as a Receiver of the whole or
any part of the Charged Property, the Security Trustee may specify
whether the appointment, and the Powers of each appointee, will at
its option be joint, or joint and several, and failing such
specification, the appointment and the Powers of each person will
be deemed to be joint and several.
6.3 REMUNERATION OF RECEIVER
The Security Trustee may fix the rate of remuneration of any
Receiver at such rate as the Security Trustee from time to time
determines, which rate will not exceed the standard hourly rate
from time to time charged by the firm of which the Receiver is a
member for work of the level conducted by the Receiver.
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6.4 AGENT OF THE CHARGOR
Every Receiver will be the agent of the Chargor who will be solely
responsible for all acts and omissions by and the remuneration of
the Receiver.
6.5 POWERS OF RECEIVER
Without the need for any consent by the Chargor, each Receiver will
have all of the powers specified in section 420 of the Corporations
Law, and in addition to those and any other Powers, will have all
of the following powers:
(a) (TAKE POSSESSION): to take possession or control of or
make use of the whole or any part of the Charged
Property or relinquish possession or control;
(b) (CONVERT TO MONEY): to convert, liquidate and reduce
the whole or any part of the Charged Property into
money;
(c) (LEASE): whether or not the Receiver has taken
possession, to lease or licence in the name of the
Chargor or otherwise the whole or any part of the
Charged Property, for any period and on any terms or to
vary or terminate a lease or licence;
(d) (CARRY ON BUSINESS): to carry on or concur in carrying
on each Business and do all acts which the Chargor
might do in the ordinary conduct of such Business for
the protection or improvement of the whole or part of
the Charged Property;
(e) (BORROW OR RAISE MONEY): to borrow or raise from the
Security Trustee or any other person any money which
may be required for any purpose, and in the name of the
Chargor or otherwise to secure any money so borrowed or
raised by the grant of any Encumbrance over the whole
or part of the Charged Property (whether in the name of
the Chargor or otherwise) so that the Encumbrance ranks
in priority to, pari passu with or after this Charge.
The Security Trustee will not be bound to inquire as to
the necessity or propriety of any Financial Liability
nor be responsible for the misapplication or non-
application of any money so borrowed or raised;
(f) (ENGAGE): to engage consultants, contractors,
professional advisers, agents and employees (including
any person associated with a firm or company in which
the Receiver is a member or in which he is interested,
and that person may charge for his services as if he
had been independently retained at such salaries or
remuneration as the Receiver thinks fit), and the
Receiver may act on any advice given by that person;
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<PAGE> 539
(g) (CONDUCT WORKS): to repair, renew, replace, renovate or
clean the Charged Property, to erect any new buildings
or make any improvements to any land forming part of
the Charged Property, and to demolish, alter, rebuild
or extend any existing buildings on the Charged
Property;
(h) (SELL PROPERTY): whether or not in possession, to sell
or concur in selling all or any of the Charged Property
by public auction, private treaty or tender, for cash
or on credit, in one lot or in parcels, with or without
special conditions as to title or the time and the mode
of payment of purchase money and on such other terms as
the Receiver thinks fit, with power to defer payment of
any part of the purchase money, whether or not secured
by an Encumbrance from the purchaser, and to buy in and
to rescind or vary any contract for sale, and to resell
without being responsible for loss;
(i) (CONTRACTS FOR SALE): to exercise all or any rights,
powers and remedies of the Chargor under any contract
for sale and to execute those contracts, transfers,
applications for transfer, assignments and assurances
of all or any part of the Charged Property in the name
and on behalf of the Chargor or otherwise, and to do
all other acts and things for implementing and
completing any sale that the Receiver deems necessary;
(j) (SEVER AND SELL FIXTURES): to sever fixtures belonging
to the Chargor and to sell them separately from any
other part of the Charged Property;
(k) (INVEST PROCEEDS AGAINST CONTINGENCIES): if any part of
the Secured Money is contingent, to invest, deposit or
hold the Charged Property in a form or mode of
investment for the time being as the Receiver in its
absolute discretion thinks fit, with like power to
vary, transpose or re-invest the investments or
deposits from time to time until such part of the
Secured Money ceases to be contingent;
(l) (ENTER INTO CONTRACTS): to enter into any contract or
arrangement with any person for any purpose connected
with this Charge or the whole or any part of the
Charged Property or in furtherance of any Power, on
such terms and conditions as the Receiver in its
absolute discretion thinks fit, including without
limitation, granting or conferring options to, in
favour of or exercisable by any person for the purpose
of or in connection with the sale, purchase, leasing,
hiring, or other dealing with, the whole or any part of
the Charged Property;
(m) (PERFORM CONTRACTS): to perform, observe, carry out,
enforce specific performance of, exercise or refrain
from exercising, the Chargor's rights and powers under,
obtain the benefit of, and to vary or rescind,
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all contracts and rights forming part of the Charged
Property or entered into in the exercise of any Power;
(n) (TAKE PROCEEDINGS): to institute, conduct or defend any
proceedings in law, equity or bankruptcy, and to submit
to arbitration, mediation or conciliation, in the name
of the Chargor or otherwise and on any terms, any
proceeding, claim, question or dispute in connection
with the Charged Property or otherwise;
(o) (COMPROMISE): to make any settlement, arrangement or
compromise regarding any action or dispute arising in
connection with the Charged Property; to grant to any
person involved therein time or other indulgence; and
to execute all such releases or discharges in
connection therewith as the Receiver thinks expedient
in the interests of the Security Trustee;
(p) (APPEAL): to appeal against or to enforce any judgment
or order;
(q) (BANKRUPT DEBTORS AND WIND-UP COMPANIES): to make
debtors bankrupt and to wind-up companies and to do all
things in connection with any bankruptcy or winding up
which the Receiver thinks necessary for the recovery or
protection of the whole or part of the Charged
Property, or for the security or other benefit of the
Security Trustee;
(r) (DELEGATE): with the consent in writing of the Security
Trustee, to delegate to any person for such time or
times as the Security Trustee approves, any of the
Powers, including this power of delegation;
(s) (FILE): to file all certificates, registrations and
other documents and to take any and all action on
behalf of the Chargor which the Security Trustee or
Receiver believes is necessary to protect, preserve or
improve any or all of the Charged Property and the
rights of the Chargor and the Security Trustee in
respect of any agreement for sale, and to obtain for
the Security Trustee and the Stockholders all of the
benefits of this Charge and any Transaction Document;
and in particular, the placing of the Chargor into
liquidation or the appointment of a Receiver will be
deemed to be an event against which the Security
Trustee may protect its rights;
(t) (MAKE CALLS): to call and get in the uncalled and
called but unpaid nominal or premium capital of the
Chargor;
(u) (OPERATE BANK ACCOUNTS): to open or operate any bank
account in the Chargor's name (whether alone or
jointly) to the exclusion of the Chargor, and to
deposit or withdraw any money to the credit of that
account, and to sign and indorse or to authorise others
to sign and
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<PAGE> 541
indorse in the name of the Chargor cheques, promissory
notes bills of exchange and other negotiable
instruments;
(v) (DO ALL OTHER THINGS NECESSARY): to do all things
necessary to perform, observe and fulfil any of the
covenants on the part of the Chargor contained in this
Charge; and
(w) (RECEIVER'S DISCRETION): to do all other acts and
things without limitation as the Receiver thinks
expedient in the interests of the Security Trustee or
the Stockholders,
and any further powers and discretions as the Security Trustee
confers on the Receiver by notice in writing to the Receiver for
the purposes referred to in this clause 6.5,
PROVIDED THAT a Receiver may only exercise the powers referred to
in this clause 6.5 in respect of the Remaining Property if an
Administrator Event has occurred.
6.6 INDEMNITY
The Security Trustee may give any indemnities to the Receiver
concerning the performance of the Receiver's duties as are
permitted by law. If the Security Trustee is obliged to pay any
money under any indemnity, that money will become part of the
Secured Money.
7. SECURITY TRUSTEE'S POWERS
7.1 EXERCISE OF POWER
At any time after the happening of any Event of Default or after
the whole or part of the Secured Money becomes due and payable
under the provisions of this Charge the Security Trustee may if
directed by an Extraordinary Resolution of Stockholders without
notice and whether or not a Receiver has been appointed:
(a) exercise all or any of the Powers conferred on a
Receiver or which would be conferred on a Receiver if
appointed as if those Powers had been expressly
conferred on the Security Trustee;
(b) exercise all other Powers; and
(c) appoint an agent or joint and several agents and
delegate such Powers to it or them (in which case
clauses 6.1, 6.3 and 6.6 will apply as if it or they
were appointed as a Receiver),
PROVIDED THAT the Security Trustee may only exercise its rights and
powers under this clause 7.1 in respect of the Remaining Property
if an Administrator Event has occurred.
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7.2 ACT JOINTLY
The Security Trustee or Receiver may exercise any of the Powers in
conjunction with the exercise of similar powers by any other
Encumbrancee of the whole or part of the Charged Property or by any
receiver appointed by that other Encumbrancee, and may enter into
and give effect to agreements and arrangements with that other
Encumbrancee or receiver as the Security Trustee or Receiver thinks
fit.
7.3 POWER OF ATTORNEY
(a) The Chargor irrevocably appoints the Security Trustee,
each director, manager and attorney from time to time
of the Security Trustee, and any Receiver severally, as
its attorney, with power at any time after the
occurrence of an Event of Default (and to the extent to
which the Event of Default has not been remedied or
waived) to:
(i) do all acts which ought to be done by the Chargor
under this Charge or to exercise any Power;
(ii) demand, sue for, recover and receive all or any
part(s) of the Charged Property from any person,
in the name of and on behalf of the Chargor, or
in the name of the Security Trustee or an
attorney appointed under this Charge;
(iii) take further action and to execute further
instruments which are, or are in the opinion of
the Security Trustee, either necessary to more
satisfactorily secure the payment of the Secured
Money or are expedient in relation to the Charged
Property; and
(iv) appoint (and remove at will) at any time any
person(s) as a substitute(s) for an attorney or
attorneys,
PROVIDED THAT an attorney may only exercise rights and
powers under this clause 7.3 in respect of the Remaining
Property if an Administrator Event has occurred (and to the
extent to which the Administrator Event has not been
remedied or waived).
(b) The Chargor ratifies and confirms now and for the
future all actions lawfully undertaken by or on behalf
of its attorney under this Power of Attorney.
(c) The Chargor declares that this Power of Attorney will
continue in force until all actions taken under it have
been completed, notwithstanding the discharge of this
Charge or any of the agreements or arrangements to
which it refers.
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7.4 SECURITY TRUSTEE MAY MAKE GOOD ANY DEFAULT
If the Chargor defaults in duly performing, observing and
fulfilling any of the Obligations, the Security Trustee may,
without prejudice to any other Power, do all things and pay all
money necessary or expedient in the opinion of the Security Trustee
to make good or to attempt to make good that default to the
satisfaction of the Security Trustee.
7.5 NOTICE FOR EXERCISE OF POWERS
(a) The Powers may be exercised by the Security Trustee and
the Receiver immediately or at any time after an Event
of Default occurs without any notice or lapse of time
being necessary unless required by a law which cannot
be excluded.
(b) One day is fixed as the period for which:
(i) default must continue in the performance,
observance and fulfilment of the whole or any
part of the Obligations, or in the payment of any
part of the Secured Money, including interest,
before the Security Trustee may serve any notice
in writing as required by any Statute affecting
the Powers; and
(ii) default must continue after the service of notice
before any power of sale given by Statute may be
exercised.
8. APPLICATION OF MONEY
8.1 PRIORITY OF PAYMENTS
All money received by the Security Trustee or by the Receiver as a
result of the exercise of the Powers in respect of the Chargor will
be applied in the following order:
(a) (INCIDENTAL TO EXERCISE OF POWERS): in payment of all
costs, charges, expenses and disbursements incurred in
or incidental to the exercise or attempted exercise of
any of the Powers;
(b) (OUTGOINGS): in payment of any other outgoings as the
Receiver or the Security Trustee thinks fit;
(c) (PAYMENT OF SECURED MONEY SECURED BY STOCK): in payment
to the Stockholders of the balance of the Secured Money
(other than the Face Amount) secured by the Stock
(rateably according to the respective amounts of their
respective Secured Money as at the date the payment is
made);
(d) (PAYMENT OF FACE AMOUNT): in payment to the
Stockholders in respect of the Face Amount secured by
the Stock (rateably according
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to the respective amounts of their respective Secured
Money as at the date the payment is made);
(e) (SUBSEQUENT ENCUMBRANCES): in payment of subsequent
Encumbrances of which the Security Trustee is aware in
the order of their priority; and
(f) (SURPLUS): the surplus (if any) belongs to the Chargor
but does not carry interest.
8.2 CONTINGENT INDEBTEDNESS
If the Security Trustee receives money in connection with this
Charge when part of the Secured Money is contingently or
prospectively owing, then the Security Trustee must deposit an
amount not exceeding that part in an interest-bearing deposit
account with a bank on such terms as the Security Trustee thinks
fit until that part becomes actually payable or no longer falls
within the definition of "Secured Money". At that time the Security
Trustee may retain for its own account the amount which is then
actually payable to it. The balance is to be paid in accordance
with clause 8.1.
8.3 MONEY RECEIVED
In applying any money towards satisfaction of the Secured Money,
the Chargor will be credited only with as much of the money
available for that purpose as will be actually received by the
Security Trustee or the Receiver and is not required for whatever
reason to be disgorged, a credit to date from the time of receipt.
8.4 APPLICATION OF PAYMENTS OR CREDITS
Subject to this clause 8, each of the Security Trustee and the
Receiver has an absolute discretion to apply any payment or credit
received by it under this Charge in reduction of any part or parts
of the Secured Money, whenever and on whatever account the same
became secured, notwithstanding any principle or presumption of law
to the contrary or any direction given at the time of receipt, and
without the need to communicate its election to any person.
8.5 RELIANCE ON CERTIFICATE
In making any payment to any other Encumbrancee under clause 8.1,
the Security Trustee and the Receiver may rely on a certificate
from that Encumbrancee as to the amount secured, and are not bound
to enquire as to the accuracy of the certificate or whether the
amount referred to is validly secured by the Encumbrance.
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9. LIABILITY AND RELEASE
9.1 CONTINUING OBLIGATION
This Charge constitutes a continuing obligation regardless of any
settlement of account, intervening payment, express or implied
revocation, or any other matter or thing. Without limiting the
generality of the foregoing, each indemnity in this Charge is a
separate additional and continuing obligation and will survive the
discharge of this Charge. Unless otherwise agreed, payment by the
Security Trustee will not be a pre-condition to liability under any
indemnity.
9.2 PERSONAL LIABILITY
Notwithstanding any payout figure quoted or other form of account
stated by the Security Trustee, and notwithstanding the rule in
GROONGAL PASTORAL COMPANY LIMITED (IN LIQUIDATION) V. FALKINER
(1924) 35 CLR 157, no grant of full or partial satisfaction of or
discharge from this Charge by the Security Trustee will release the
Chargor from personal liability under this Charge or under any
Transaction Document until all the Secured Money has in fact been
received by the Security Trustee and is not liable to be disgorged,
notwithstanding that the quotation or statement of account has
arisen from the mistake, negligence, error of law or error of fact
of the Security Trustee, its servants or agents.
9.3 SETTLEMENT CONDITIONAL
Any settlement or discharge between the Chargor and the Security
Trustee is conditional on any security or payment given or made to
the Security Trustee by the Chargor or any other person in relation
to the Obligations not being avoided, repaid or reduced by virtue
of any Insolvency Provision. If the security or payment is avoided,
repaid or reduced, the Security Trustee is entitled to recover the
value or amount of such security or payment avoided, repaid or
reduced from the Chargor subsequently as if that settlement or
discharge had not occurred.
9.4 CHARGOR'S LIABILITY NOT AFFECTED
The liability of the Chargor under this Charge:
(a) (ABSOLUTE): is absolute and is not subject to the
execution of any Transaction Document or any other
document by any person or to the performance of any
condition precedent or subsequent;
(b) (NOT AFFECTED): will not be affected by any act,
omission, matter or thing that would otherwise operate
in law or in equity to reduce or release the Chargor
from its liability including, without limiting the
generality of the foregoing, any of the following:
(i) the occurrence of any Event of Default;
(ii) the receipt by the Security Trustee of any
payment,
22.
<PAGE> 546
dividend or distribution under any Insolvency
Provision in relation to the Chargor;
(iii) any Transaction Document or any payment the
making of which would otherwise have formed
part of the Secured Money being or becoming or
being conceded to be illegal, invalid, void,
voidable, unenforceable or irrecoverable in
whole or in part for any reason whether past,
present or future, including, without limiting
the generality of the foregoing:
A. any Statute, other law or principle of
equity;
B. any act or omission by any person;
C. any legal limitation, disability or
incapacity of the Chargor;
D. any improper exercise of a Power;
E. any Power being suspended or postponed by
Statute, any court order or otherwise; or
F. any Insolvency Provision;
(iv) the Security Trustee accepting any Transaction
Document;
(v) the Security Trustee granting time, waiver or
other indulgence or concession to, or to making
any composition or compromise with, the
Chargor;
(vi) the Security Trustee forbearing or neglecting
to exercise any remedy or right it has for the
enforcement of any Transaction Document or any
of the Obligations;
(vii) any laches, acquiescence or other act, neglect,
default, omission or mistake by the Security
Trustee;
(viii) the determination, rescission, repudiation or
termination, or the acceptance of any of the
foregoing, by the Security Trustee or the
Chargor of any Transaction Document or any of
the Obligations;
(ix) execution of any Transaction Document or any
variation to any Transaction Document or any of
the Obligations, whether or not such event
imposes an additional liability upon or is
onerous on the Chargor;
(x) the full, partial or conditional release or
discharge by the Security Trustee or by
operation of law, of any person from any
Transaction Document or any of the Obligations;
(xi) the release of any property from any
Transaction Document or the substitution of any
property in place of any other property now or
hereafter the subject of a Transaction
Document;
(xii) the Security Trustee wasting, destroying,
abandoning, prejudicing or not perfecting,
maintaining, preserving, enforcing or realising
or not properly enforcing or realising a
Transaction Document;
(xiii) the failure to obtain any Transaction Document
or the loss or impairment of any Transaction
Document by operation
23.
<PAGE> 547
of law or otherwise, whether or not the same is
in breach of an express or implied condition to
obtain or preserve such Transaction Document or
in breach of any equitable duty which might
otherwise have been imposed upon the Security
Trustee;
(xiv) the postponement or loss of the priority
attaching to any Transaction Document;
(xv) the opening or operation of any new account with
the Security Trustee by the Chargor;
(xvi) any change in membership (whether by death or
retirement of an existing member, admission of a
new member or otherwise) or name of any
partnership, firm or association in which the
Chargor is a member;
(xvii) the transfer or assignment of the benefit of any
Transaction Document or of any of the
Obligations;
(xviii) any failure by the Security Trustee to disclose
to the Chargor any material or unusual fact,
circumstance, event or thing whatsoever known to,
or which ought to have been known by, the
Security Trustee relating to or affecting the
Chargor at any time prior to or during the
currency of any Transaction Document, whether
prejudicial or not to the rights and liabilities
of the Chargor and whether or not the Security
Trustee was under any duty of disclosure; or
(xix) the Security Trustee entering into a covenant
with the Chargor not to sue, issue process, sign
or execute judgment, commence proceedings for
bankruptcy or liquidation, participate in any
scheme of arrangement or reconstruction, prove in
any bankruptcy or liquidation or do any other
act, matter or thing in respect of the liability
of the Chargor.
9.5 RELEASE OF CHARGED PROPERTY
The Security Trustee will be under no obligation to grant a release
of the Charged Property from this Charge unless at the time the
release is to be provided, none of the Secured Money is owing
(whether actually, contingently, or prospectively), none of the
Obligations remain to be performed and it is not reasonably
foreseeable that there could be any money owing or Obligations to
be performed at a future time.
10. PROTECTION AND INDEMNITY
10.1 WAIVER BY THE CHARGOR
The Chargor waives in favour of the Security Trustee:
(a) all rights against the Security Trustee and any other
person, estate or assets as far as is necessary to give
effect to any provision of this
24.
<PAGE> 548
Charge;
(b) promptness and diligence on the part of the Security
Trustee, and any other requirement that the Security
Trustee take any action or exhaust any right against
any other person before enforcing this Charge; and
(c) all rights inconsistent with the provisions of this
Charge, including any rights of contribution or
subrogation which the Chargor might otherwise be
entitled to claim or enforce.
10.2 NO LIABILITY FOR LOSS
Neither the Security Trustee nor any Receiver will be liable or
otherwise accountable for any omission, delay or mistake, or any
loss or irregularity in or about the exercise, attempted exercise,
non-exercise or purported exercise of any Power, except for actual
fraud or wilful misconduct.
10.3 NO LIABILITY TO ACCOUNT
Neither the Security Trustee nor any Receiver will, by reason of
the Security Trustee or the Receiver entering into possession of
the whole or part of the Charged Property, be liable to account as
mortgagee or Security Trustee in possession, or for any loss on
realisation or for any default, omission, delay or mistake for
which a mortgagee or Security Trustee in possession might be
liable.
10.4 NO CONFLICT
The Security Trustee and any Receiver may exercise any Power
notwithstanding that the exercise of that Power involves a conflict
between any duty owed to the Chargor by the Security Trustee or
that Receiver and any duty owed by the Security Trustee or Receiver
to any other person, or the interests of the Security Trustee or
Receiver. No contract will be void or voidable by virtue of any
such conflict of duty or interest, nor will the Security Trustee or
Receiver be liable to account to the Chargor or any other person
for any money or property as a result of such conflict.
10.5 NO NOTICE OR ENFORCEMENT
The Security Trustee need not give any notice of this Charge to any
debtor of the Chargor, or to any purchaser, or to any other person,
or to enforce payment of any money payable to the Chargor, or
realise any of the Charged Property, or to take any steps or
proceedings for that purpose.
10.6 INDEMNITY
The Chargor will on demand indemnify and keep the Security Trustee
indemnified in respect of all costs, expenses, liabilities and
losses incurred by the Security Trustee or the Receiver:
25.
<PAGE> 549
(a) in the exercise, attempted exercise or non-exercise of
any Power, including (without limitation) those
consequent on any mistake, oversight, error of judgment
or want of prudence on the part of the Security Trustee
or the Receiver, unless the same is due to actual fraud
or wilful misconduct;
(b) as a consequence of the occurrence of any Event of
Default;
(c) by reason of this Charge;
(d) in respect of any act or omission for which the
Security Trustee or the Receiver is exonerated by this
Charge; and
(e) by reason of the Security Trustee redeeming or taking a
transfer of any Encumbrance ranking in priority to or
pari passu with this Charge,
and the Chargor will defend all actions, proceedings, claims or
demands brought by any person in relation to any matter the subject
of this indemnity.
10.7 PROTECTION OF PERSONS DEALING WITH THE SECURITY TRUSTEE OR
RECEIVER
No person acquiring any money or asset from or paying or handing
over any money or asset to or otherwise dealing with the Security
Trustee, the Receiver or any attorney appointed under this Charge,
or to whom is tendered for registration an instrument executed by
the Security Trustee, the Receiver or any attorney appointed under
this Charge, will be:
(a) bound to inquire:
(i) whether any Event of Default has occurred;
(ii) whether any of the Secured Money is owing or
payable;
(iii) whether the Receiver or attorney has been
properly appointed;
(iv) as to the propriety or regularity of the exercise
or purported exercise of any Power; or
(v) as to any other matter or thing;
(b) affected by actual or constructive notice that any
transaction, document or other dealing is unnecessary
or improper; or
(c) concerned to see to the application of any money or
asset, or be answerable or accountable for any loss or
misapplication,
and the irregular, improper or unnecessary exercise of any Power
will be, as regards the protection of any such person, deemed to be
authorised by the Chargor, and valid.
26.
<PAGE> 550
11. PAYMENTS
11.1 CREDIT BALANCES OF OTHER ACCOUNTS
In determining the Secured Money, no credit need be allowed by the
Security Trustee or any Stockholder for any credit balance in any
joint or other account of the Chargor with either of them, or for
any other money owing by the Security Trustee or any Stockholder to
the Chargor.
11.2 PAYMENT OF INTEREST
The Chargor will pay interest on the Secured Money to the Security
Trustee or any Stockholder in accordance with each Transaction
Document, and in the absence of any relevant provision, to the
Security Trustee at the Specified Rate calculated on daily balances
computed from the time or respective times when the money becomes
owing to, or is paid by, the Security Trustee or Stockholder.
Interest accrues daily, and is payable on the earlier of a demand
from the Security Trustee (made at the request of a Stockholder) or
the last Banking Day of each calendar month, whilst the Secured
Money remains outstanding.
11.3 CAPITALISATION OF INTEREST
The Security Trustee or any Stockholder may capitalise any interest
which has become due and owing in accordance with any Transaction
Document or in the absence of any relevant provision then at such
periods of not less than one calendar month and from such dates as
the Security Trustee or that Stockholder elects. The accumulation
of capitalised interest may continue until the Secured Money has
been paid in full, notwithstanding any composition, compromise,
judgment or order in respect of any person or any other matter.
11.4 MERGER
If the liability of the Chargor to pay any of the Secured Money to
the Security Trustee or any Stockholder becomes merged in any
judgment or order, the Chargor will, as an independent obligation,
pay interest at the rate which is the higher of that payable under
this Charge and that fixed by or payable under that judgment or
order.
11.5 NO DEDUCTION FOR TAXES AND NO SET-OFF OR COUNTERCLAIM
Subject to any Transaction Document, all payments of Secured Money
by the Chargor to the Security Trustee or a Stockholder will be:
(a) free of any set-off or counterclaim; and
(b) subject to any Statute, without deduction or
withholding for any present or future Taxes.
27.
<PAGE> 551
11.6 CURRENCY CONVERSION AND INDEMNITY
(a) If any amount is required to be paid in a particular
currency and the Security Trustee receives payment in
another currency, the Security Trustee may actually or
notionally convert the amount received into the
required currency at the spot rate which it is or
considers it would be able to obtain in the market at
the time following receipt when it sees fit to make the
conversion. The Chargor will only satisfy its
obligation to pay in the required currency to the
extent of the amount actually or notionally received
after deducting the costs of conversion.
(b) The Chargor agrees to indemnify the Security Trustee
for any deficiency which arises for any reason between
the amount actually received under any judgment, court
or tribunal order or distribution under any Insolvency
Provision which takes into account any currency
conversion rate and the amount which would be actually
or notionally received by the Security Trustee by
applying the conversion provided for in this clause.
12. EXPENSES, STAMP DUTIES AND REGISTRATION
12.1 EXPENSES
The Chargor on demand will reimburse the Security Trustee for and
keep the Security Trustee indemnified against all expenses,
including legal fees, costs and disbursements (on a solicitor/own
client basis) incurred by the Security Trustee in connection with:
(a) (PREPARATION): the preparation, negotiation and
execution of the Transaction Documents and any
subsequent consent, agreement, waiver, amendment to, or
discharge of any of them; and
(b) (ENFORCEMENT): the exercise, enforcement, preservation,
or attempted exercise, enforcement or preservation of
any rights under the Transaction Documents, including
without limitation any expenses incurred in the
evaluation of any matter of material concern to the
Security Trustee or any Stockholder.
The Chargor will bear the cost of its compliance with the
Transaction Documents.
12.2 STAMP DUTIES
(a) (PAYMENT OF ALL DUTIES): The Chargor will pay all stamp
duty, loan transaction, registration and similar Taxes,
including fines and penalties, financial institutions
duty and debits tax which may be payable to or required
to be paid by any appropriate authority, or determined
to be payable in connection with the execution,
delivery, performance or enforcement of this Charge, or
any payment, receipt
28.
<PAGE> 552
or other transaction contemplated by this Charge.
(b) (INDEMNITY): The Chargor will indemnify the Security
Trustee against any loss or liability incurred or
suffered by it as a result of the delay or failure by
the Chargor to pay Taxes.
12.3 REGISTRATION
The Chargor will ensure that this Charge is registered in the
manner and within such time limits as may be prescribed by law to
ensure the full efficacy of this Charge as a security to the
Security Trustee in all relevant jurisdictions.
13. GOVERNING LAW AND JURISDICTION
13.1 GOVERNING LAW
This Charge is to be governed by and construed in accordance with
the laws of New South Wales.
13.2 JURISDICTION
(a) (ACCEPTANCE OF JURISDICTION): The Chargor irrevocably
submits to and accepts generally and unconditionally
the non-exclusive jurisdiction of the courts and
appellate courts of New South Wales with respect to any
legal action or proceedings which may be brought at any
time relating in any way to this Charge.
(b) (NO OBJECTION TO INCONVENIENT FORUM): The Chargor
irrevocably waives any objection it may now or in the
future have to the venue of any such action or
proceedings, and any claim it may now or in the future
have that action or proceeding has been brought in an
inconvenient forum.
14. MISCELLANEOUS
14.1 CONFIDENTIALITY
(a) Subject to clause 14.1(b) the Security Trustee and the
Stockholders will not disclose any confidential or
unpublished information or documents supplied by the
Chargor in connection with the Transaction Documents
which are specifically indicated by the Chargor to be
confidential.
(b) The Security Trustee and the Stockholders will be
entitled to disclose any confidential information or
documents:
(i) to a Stockholder;
29.
<PAGE> 553
(ii) in any proceeding arising out of or in connection
with any Transaction Document to the extent that
such disclosure is deemed by that person
necessary to protect its interests;
(iii) if required to do so under a binding order of any
Government Authority or any procedure for
discovery in any proceedings;
(iv) if required to do so under any law or any
administrative guideline, directive, request or
policy whether or not having the force of law
and, if not having the force of law, the
observance of which is in accordance with the
practice of responsible trustees, bankers or
financial institutions;
(v) otherwise as required or permitted by any
Transaction Document;
(vi) to its legal advisers and its consultants as long
as it advises them of the confidential nature of
the information or documents or that nature is
clear from the circumstances of the disclosure;
(vii) to a proposed Stockholder or assignee or
transferee from a Stockholder with the prior
written consent of the Chargor which consent will
not unreasonably be withheld or delayed and will
be deemed to have been given if not refused
within 5 Banking Days of a request therefore; or
(viii) with the Chargor's prior written consent.
(c) This clause 14.1 survives the termination of this
Charge.
14.2 FURTHER ASSURANCE
The Chargor will, and will procure that, all persons having or
claiming any estate or interest in the whole or part of the Charged
Property from time to time and at all times after the date of this
Charge on the request of the Security Trustee and at the cost of
the Chargor, will make, do and execute or cause to be made, done
and executed all acts, deeds and assurances for:
(a) more satisfactorily securing to the Security Trustee
the payment of the Secured Money;
(b) assuring or more satisfactorily assuring the Charged
Property to the Security Trustee, or as the Security
Trustee may direct; or
(c) facilitating the exercise of any Power.
In particular, whenever requested to do so by the Security Trustee,
the Chargor will execute in favour of the Security Trustee legal
mortgages, transfers, assignments or other assurances of the
Charged Property in terms acceptable to the Security Trustee.
30.
<PAGE> 554
14.3 CERTIFICATE OF SECURITY TRUSTEE
A certificate in writing signed by an officer of the Security
Trustee certifying the amount payable by the Chargor to the
Security Trustee or stating any other act, matter or thing relating
to this Charge or any Transaction Document is conclusive and
binding on the Chargor in the absence of manifest error on the face
of the certificate.
14.4 NOTICES
Any notice or other communication served, given or made under or in
connection with this Charge or any Collateral Security to which the
Chargor is a party:
(a) must be in writing in order to be valid;
(b) is sufficient if executed by the party serving, giving
or making the same or on its behalf by any attorney,
director, secretary, other duly authorised officer or
solicitor of such party;
(c) will be deemed to have been duly served, given or made
in relation to a party if it is delivered or posted by
prepaid post to the address, or sent by facsimile to
the number of that party set out in the Transaction
Documents or notified in writing by that party to the
other parties from time to time; and
(d) will be deemed to be served, given or made:
(i) (in the case of prepaid post) on the fifth day
after the date of posting;
(ii) (in the case of facsimile) on receipt of a
transmission report confirming successful
transmission; and
(iii) (in the case of delivery by hand) on delivery.
14.5 ASSIGNMENT
(a) (CHARGE BINDS ASSIGNS): This Charge will be binding on
and inure to the benefit of the Chargor, the
Stockholders and the Security Trustee and their
respective successors and assigns.
(b) (ASSIGNMENT BY THE CHARGOR): Notwithstanding clause
14.5(a), the Chargor may not assign or transfer all or
any part of its rights or obligations under this Charge
without the prior written consent of the Security
Trustee acting on the instructions of all the
Stockholders.
14.6 NO MERGER
Neither this Charge, any Collateral Security nor any of the Powers
will merge or prejudicially affect or be merged in or prejudicially
affected by and the Chargor's
31.
<PAGE> 555
obligations under this Charge will not in any way be abrogated or
released by any other security, any judgment or order, any
contract, any cause of action or remedy, or any other matter or
thing now or hereafter existing in respect of the Secured Money.
14.7 SEVERABILITY OF PROVISIONS
Any provision of a Transaction Document which is illegal, void or
unenforceable will be ineffective to the extent only of that
illegality, voidness or unenforceability without invalidating the
remaining provisions.
14.8 POWERS CUMULATIVE
Each Power is cumulative and in addition to each other Power
available to the Security Trustee or the Receiver.
14.9 WAIVER
A failure to exercise or enforce or a delay in exercising or
enforcing or the partial exercise or enforcement of any Power by
the Security Trustee will not in any way preclude, or operate as a
waiver of, any further exercise or enforcement of that or any other
Power.
14.10 CONSENTS
Any waiver or consent given by the Security Trustee under this
Charge may be given or withheld and may be given subject to any
conditions, as the Security Trustee thinks fit in its absolute
discretion unless this Charge expressly provides otherwise.
14.11 WRITTEN WAIVER AND CONSENT
Any waiver or consent given by the Security Trustee under this
Charge or any Collateral Security will only be effective and
binding on the Security Trustee if it is given or confirmed in
writing.
14.12 TIME OF ESSENCE
Time is of the essence in respect of the Chargor's obligations
under this Charge or any Collateral Security.
14.13 MORATORIUM LEGISLATION
To the fullest extent permitted by law, the provisions of all
Statutes at any time operating directly or indirectly to lessen or
affect in favour of the Chargor any obligation under this Charge or
any Collateral Security, or to delay or otherwise prevent or
prejudicially affect the exercise of any Power, are expressly
waived, negatived and excluded.
32.
<PAGE> 556
14.14 BINDING ON EACH SIGNATORY
This Charge is binding on each of the signatories notwithstanding
that any one or more of the named parties does not execute this
Charge, or that there is any invalidity, forgery or irregularity
touching any execution of this Charge, or that this Charge is or
becomes unenforceable, void or voidable against a named party.
14.15 COUNTERPARTS
This Charge may be executed in a number of counterparts, all of
which taken together will be deemed to constitute one and the same
document.
14.16 NO REPRESENTATION BY OR RELIANCE ON SECURITY TRUSTEE
The Chargor does not enter into this Charge in reliance on or as a
result of any representation, promise, statement, conduct or
inducement by or on behalf of the Security Trustee or any
Stockholder otherwise than as set out in the Transaction Documents.
33.
<PAGE> 557
SCHEDULE
<TABLE>
<CAPTION>
NAME ADDRESS FOLIO IDENTIFIER
NSW
<S> <C> <C>
Annandale Nursing Home 76 Johnston Street, Auto Consol
Annandale NSW 2038 9867-46
Armon Nursing Home 42 Croydon Street, 1/110079
Petersham NSW 2049
Bathurst Nursing Home 61 Boyd Street, 11/806355
Kelso NSW 2795
Bossley Park Nursing Home 52-64 Quarry Street, Bossley 8/713734
Park NSW 2176
Canterbury District Nursing 20 Albert Street, 1/549851
Home Campsie NSW 2194
Crest Nursing Home 11 Johnston Street, 1/913045 and 1/913044
Annandale NSW 2038
Dubbo Nursing Home 80 Muller Street, 12/592842
Dubbo NSW 2830
Fernleigh Nursing Home 8 Sherbrooke Road, 4/201757 and 1/201757
West Ryde NSW 2114
Maitland Nursing Home Broughton Street, Rutherford 5/733509
NSW 2320
Mudgee Nursing Home 207-213 Denison Street, 1/261314
Mudgee NSW 2850
Murwillumbah Nursing Cnr North Arm Road and 1/786640
Home Ingram Place,
Murwillumbah NSW 2484
Narrandera Nursing Home Chantilly Street, 2/582847
Narrandera NSW 2700 308/257212
Norah Head Nursing Home 63 Palomar Parade, 721/26247 and
Toukley NSW 2263 509/26247
Quakers Hill Nursing Home 35 Hambledon Road, 10/860042
Quakers Hill NSW 2763
Shoalhaven Nursing Home Brinawarr Street, 5/614886
Bomaderry NSW 2541
</TABLE>
34.
<PAGE> 558
<TABLE>
<CAPTION>
NAME ADDRESS FOLIO IDENTIFIER
<S> <C> <C>
Stanmore Nursing Home 66 Cambridge Street, 31/7/1
Stanmore NSW 2048
</TABLE>
35.
<PAGE> 559
<TABLE>
<CAPTION>
NAME ADDRESS FOLIO IDENTIFIER
QUEENSLAND
<S> <C> <C>
Caloundra Nursing Home Lyon Street, Lot 2, RP 177466
Caloundra QLD 4551
Nambour Nursing Home 9 Princess Crescent, Lot 2, RP 183823
Nambour QLD 4560
WESTERN AUSTRALIA
Apple Cross Nursing Home 30 Carron Road, Vol. 1964 Fol 640
Apple Cross WA 6153
Armadale Nursing 21 Angelo Street, Vol 1951 Fol 293
Centre/Hillview Nursing Armadale WA 6112
Home
Bunbury Nursing Home 39 Hayes Street, Vol 1534 Fol 995
Bunbury WA 6230
Geraldton Nursing Home 20 Milford Street, Vol. 1539 Fol 329
Geraldton WA 6530 Vol. 1890 Fol 506
Kalgoorlie Nursing Home Dugan Street, Vol. 1597 Fol 789
Kalgoorlie WA 6430
Narrogin Nursing Home 52 Williams Road Vol. 1634 Fol 809
Narrogin WA 6312
Murray River Nursing Home Cnr Coolibah & Boundary Vol. 1697 Fol 190
Roads,
Dudley Park,
Mandurah WA 6210
</TABLE>
36.
<PAGE> 560
<TABLE>
EXECUTED as a deed.
<S><C>
SIGNED SEALED AND DELIVERED )
for and on behalf of PRINCIPAL ) -----------------------------------------
HEALTHCARE FINANCE PTY ) (Signature)
LIMITED, ACN 069 875 476 )
by its Attorney under a )
Power of Attorney dated and who )
declares that he has not received any notice )
of the revocation of such Power of Attorney )
in the presence of:
- ----------------------------------------------
(Signature of Witness)
- ----------------------------------------------
(Name of Witness in Full)
SIGNED SEALED AND DELIVERED )
for and on behalf of ABN AMRO ) -----------------------------------------
FACILITIES AUSTRALIA LIMITED, ) (Signature)
ACN 001 035 543 )
by its Attorney under a )
Power of Attorney dated and who )
declares that he has not received any notice )
of the revocation of such Power of Attorney )
in the presence of:
- ----------------------------------------------
(Signature of Witness)
- ----------------------------------------------
(Name of Witness in Full)
</TABLE>
37.
<PAGE> 561
TABLE OF CONTENTS
<TABLE>
<CAPTION>
CLAUSE PAGE
<S> <C> <C>
1. DEFINITIONS AND INTERPRETATION 1
1.1 DEFINITIONS 1
1.2 INTERPRETATION 4
1.3 DEBENTURE STOCK TRUST DEED 5
1.4 SECURITY TRUSTEE 5
2. CHARGE 5
2.1 THE CHARGE 5
2.2 ASSETS OVER WHICH THIS CHARGE IS FIXED 6
2.3 DEALING WITH PROPERTY SUBJECT TO FLOATING CHARGE 6
2.4 AUTOMATIC CRYSTALLISATION OF FLOATING CHARGE 6
2.5 NOTICE OF CONVERSION 6
2.6 RECONVERSION 7
2.7 CONVERSION TO LEGAL MORTGAGE 7
2.8 PROSPECTIVE LIABILITY 7
3. REPRESENTATIONS AND WARRANTIES 7
3.1 GENERAL REPRESENTATIONS AND WARRANTIES 7
3.2 CORPORATE REPRESENTATIONS AND WARRANTIES 8
3.3 TRUST REPRESENTATIONS AND WARRANTIES 8
3.4 REPRESENTATIONS AND WARRANTIES REPEATED 9
4. COVENANTS CONCERNING THE CHARGED PROPERTY 10
4.1 RESTRICTIONS IN RELATION TO THE CHARGED PROPERTY 10
4.2 INSPECTION 10
4.3 PROTECTION OF CHARGED PROPERTY 10
4.4 CONDUCT OF BUSINESS 11
4.5 INTELLECTUAL PROPERTY 11
4.6 LICENCES 11
4.7 SECURITY TRUSTEE ASSUMES NO OBLIGATIONS 11
4.8 DOCUMENTS OF TITLE AND OTHER SECURITIES 12
4.9 POSTPONEMENT OR WAIVER OF ENCUMBRANCES 12
5. EVENTS OF DEFAULT 12
6. RECEIVERS: APPOINTMENT AND POWERS 12
6.1 APPOINTMENT OF RECEIVER 12
6.2 JOINT RECEIVERS 13
</TABLE>
(i)
<PAGE> 562
TABLE OF CONTENTS
<TABLE>
<CAPTION>
CLAUSE PAGE
<S> <C> <C>
6.3 REMUNERATION OF RECEIVER 13
6.4 AGENT OF THE CHARGOR 13
6.5 POWERS OF RECEIVER 13
6.6 INDEMNITY 16
7. SECURITY TRUSTEE'S POWERS 16
7.1 EXERCISE OF POWER 16
7.2 ACT JOINTLY 17
7.3 POWER OF ATTORNEY 17
7.4 SECURITY TRUSTEE MAY MAKE GOOD ANY DEFAULT 17
7.5 NOTICE FOR EXERCISE OF POWERS 18
8. APPLICATION OF MONEY 18
8.1 PRIORITY OF PAYMENTS 18
8.2 CONTINGENT INDEBTEDNESS 18
8.3 MONEY RECEIVED 19
8.4 APPLICATION OF PAYMENTS OR CREDITS 19
8.5 RELIANCE ON CERTIFICATE 19
9. LIABILITY AND RELEASE 19
9.1 CONTINUING OBLIGATION 19
9.2 PERSONAL LIABILITY 19
9.3 SETTLEMENT CONDITIONAL 20
9.4 CHARGOR'S LIABILITY NOT AFFECTED 20
9.5 RELEASE OF CHARGED PROPERTY 21
10. PROTECTION AND INDEMNITY 22
10.1 WAIVER BY THE CHARGOR 22
10.2 NO LIABILITY FOR LOSS 22
10.3 NO LIABILITY TO ACCOUNT 22
10.4 NO CONFLICT 22
10.5 NO NOTICE OR ENFORCEMENT 22
10.6 INDEMNITY 23
10.7 PROTECTION OF PERSONS DEALING WITH THE SECURITY TRUSTEE OR RECEIVER 23
11. PAYMENTS 24
11.1 CREDIT BALANCES OF OTHER ACCOUNTS 24
11.2 PAYMENT OF INTEREST 24
</TABLE>
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<PAGE> 563
TABLE OF CONTENTS
<TABLE>
<CAPTION>
CLAUSE PAGE
<S> <C> <C>
11.3 CAPITALISATION OF INTEREST 24
11.4 MERGER 24
11.5 NO DEDUCTION FOR TAXES AND NO SET-OFF OR COUNTERCLAIM 24
11.6 CURRENCY CONVERSION AND INDEMNITY 24
12. EXPENSES, STAMP DUTIES AND REGISTRATION 25
12.1 EXPENSES 25
12.2 STAMP DUTIES 25
12.3 REGISTRATION 25
13. GOVERNING LAW AND JURISDICTION 26
13.1 GOVERNING LAW 26
13.2 JURISDICTION 26
14. MISCELLANEOUS 26
14.1 CONFIDENTIALITY 26
14.2 FURTHER ASSURANCE 27
14.3 CERTIFICATE OF SECURITY TRUSTEE 27
14.4 NOTICES 27
14.5 ASSIGNMENT 28
14.6 NO MERGER 28
14.7 SEVERABILITY OF PROVISIONS 28
14.8 POWERS CUMULATIVE 28
14.9 WAIVER 28
14.10 CONSENTS 28
14.11 WRITTEN WAIVER AND CONSENT 28
14.12 TIME OF ESSENCE 29
14.13 MORATORIUM LEGISLATION 29
14.14 BINDING ON EACH SIGNATORY 29
14.15 COUNTERPARTS 29
14.16 NO REPRESENTATION BY OR RELIANCE ON SECURITY TRUSTEE 29
</TABLE>
(iii)
<PAGE> 564
DEED OF CHARGE (NSW AND VIC)
DATE:
PRINCIPAL HEALTHCARE FINANCE PTY LIMITED
Chargor
ABN AMRO FACILITIES AUSTRALIA LIMITED
Security Trustee
(C) COPYRIGHT CLAYTON UTZ
Liability is limited by the Solicitors Scheme under the
Professional Standards Act 1994 NSW
<PAGE> 565
DEED OF CHARGE (QLD) made at on 1998
BETWEEN PRINCIPAL HEALTHCARE FINANCE PTY LIMITED, ACN 069 875 476
both in its personal capacity and in its capacity as trustee of the
PHF Trust ("CHARGOR")
AND ABN AMRO FACILITIES AUSTRALIA LIMITED, ACN 001 035 543 as
trustee of the Premier Care Australia Security Trust ("SECURITY
TRUSTEE")
THIS DEED PROVIDES
1. DEFINITIONS AND INTERPRETATION
1.1 DEFINITIONS
In this Charge words which are defined in the Debenture Stock Trust Deed
and which are not defined in this Charge have the same meaning when used
in this Charge and:
"ADMINISTRATOR EVENT" means either:
(a) an administrator is appointed to the Chargor; or
(b) a proposal is made by any person to appoint an administrator to
the Chargor.
"APPROVED AGED CARE ASSETS" means assets that the Chargor proposes to
acquire (or which have been acquired, as the context requires) from Moran
Health Care Group Pty Limited (or any of its Related Bodies Corporate).
"ASSOCIATED RIGHTS" means, in relation to any property:
(a) all rights, powers and remedies of the Chargor for the
enforcement of such property; and
(b) all rights and powers of the Chargor to vary,
repudiate, rescind, avoid, waive any right under, or
terminate any agreement or arrangement relating to such
property.
"BUSINESS" means the business conducted by the Chargor in connection with
the Approved Aged Care Assets, including the acquisition or leasing of
the Approved Aged Care Assets.
"CHARGED PROPERTY" means:
(a) the Leased Property; and
(b) all rights of the Chargor under the Moran Relationship
Agreement, any management contract entered into by the
Chargor as part of or in connection with the Business,
the Moran Lease, the Moran Guarantee and the Moran
1.
<PAGE> 566
Securities; and
(c) the Remaining Property
but does not include the Excluded Property.
"DEBENTURE STOCK TRUST DEED" means the deed so entitled dated 17 June
1998 between the Chargor and the Security Trustee.
"EVENT OF CRYSTALLISATION" means each or any of the following events:
(a) any breach of clause 4.1;
(b) any Encumbrance over any asset of the Chargor becomes
enforceable or any Encumbrance that is a floating
security over any asset of the Chargor crystallises or
otherwise becomes a fixed or specific security;
(c) any Insolvency Event occurs in relation to the Chargor;
(d) the Commissioner of Taxation, or its delegate,
determines to issue a notice under section 74 of the
Sales Tax Assessment Act 1992 or section 218 of the
Income Tax Assessment Act 1936 for any amount due by
the Chargor in respect of any Tax under such Act or any
fines and costs imposed on the Chargor under such Act;
and
(e) any other event that the Security Trustee has notified
the Chargor to be an Event of Crystallisation for the
purposes of this Charge.
"EXCLUDED PROPERTY" means any asset, property or undertaking which is
located outside of Queensland.
"FAI PROPERTY" means the charged property referred to in the Original
Debenture Stock Trust Deed.
"INITIAL UNITHOLDERS" means Metlife Australia (Holdings) Pty Limited, ACN
070 667 417 and FAI Deposit Co. Pty Limited, ACN 008 647 489.
"INTELLECTUAL PROPERTY" means all patents, trademarks, copyrights,
registered designs, trade secrets, confidential information and other
intellectual property at any time held by or registered in the name of
the Chargor or which the Chargor at any time has the benefit of, has an
interest in or is entitled to use.
"LICENCE" means each licence, certificate, document, registration,
permission, privilege, permit, authority or consent which is issued or
held in connection with the Business, which is necessary or desirable to
be held by the Chargor in relation to the Business including any
variation or renewal thereof.
2.
<PAGE> 567
"LEASED PROPERTY" means:
(a) the Properties;
(b) each nursing home/residential care facility and any
other aged care or health care related facility
currently or subsequently operated on any Property;
(c) all plant and equipment fixed to any property referred
to in another paragraph of this definition; and
(d) all assets and chattels on the Properties (or any
facility referred to in paragraph (b)) and used in
connection with the Business on the date of
commencement of the Moran Lease.
"MORAN GUARANTEE" means all of the present and future right, title and
interest of the Chargor in:
(a) the Lease Guarantee dated on or about the date of this
Charge between Moran Health Care Group Pty Limited and
the Chargor; and
(b) all Associated Rights in relation to and all proceeds
deriving from the Property referred to in paragraph (a).
"MORAN LEASE" means all of the present and future right, title and
interest of the Chargor in:
(a) the lease entered into by the Chargor with Moran Health
Care (Australia) Pty Limited in respect of the
Properties on or about the date of this Charge (as
amended, varied, novated, supplemented, ratified or
replaced from time to time); and
(b) all Associated Rights in relation to and all proceeds
deriving from the property referred to in paragraph (a).
"MORAN RELATIONSHIP AGREEMENT" means the agreement entitled "Relationship
Agreement" between the Chargor, Moran Health Care (Australia) Pty Limited
and Moran Health Care Group Pty Limited dated on or about the date of
this Charge.
"MORAN SECURITIES" means all of the present and future right, title and
interest of the Chargor in:
(a) the Fixed and Floating Charge dated 19 June 1998 between
the Chargor and Moran Health Care (Australia) Pty Limited
as trustee of the Moran Health Care Australia Trust;
(b) the Mortgage of Units dated 19 June 1998 between the
Chargor and Moran Health Care Group Pty Limited; and
3.
<PAGE> 568
(c) the Mortgage of Shares dated 19 June 1998 between the
Chargor and Moran Health Care Group Pty Limited.
"ORIGINAL DEBENTURE STOCK TRUST DEED" means the Debenture Stock Trust
Deed dated 17 June 1998 between the Chargor and the Security Trustee.
"PHF TRUST" means the trust known as the "Principal Healthcare Finance
Trust" (formerly known as the "Assisted Living Unit Trust") constituted
by the Trust Deed.
"POWER" means any right, power, authority, discretion, remedy or
privilege conferred on the Security Trustee, Receiver or any attorney or
agent appointed under this Charge, by any Transaction Document, by
Statute, or by law or equity in respect of this Charge or any Collateral
Security.
"PREMIER CARE AUSTRALIA SECURITY TRUST" means the trust constituted by
the Debenture Stock Trust Deed.
"PROPERTIES" means the properties listed in the Schedule.
"RECEIVER" means a receiver or receiver and manager appointed by the
Security Trustee under this Charge and if more than one, then each of
them, and also any servant, agent or delegate of any of them.
"RELATED BODY CORPORATE" has the meaning given in section 9 of the
Corporations Law and refers to any corporation of that kind whenever it
becomes related.
"REMAINING PROPERTY" means all of the Chargor's assets, undertakings and
rights, both present and future, but excluding:
(a) the FAI Property; and
(b) the property referred to in paragraphs (a) and (b) of the
definition of "Charged Property".
"TRUST DEED" means the deed of trust dated 11 August 1995 between the
Chargor and the Initial Unitholders.
1.2 INTERPRETATION
In this Charge:
(a) headings are for convenience only and do not affect
interpretation; and unless the context indicates a
contrary intention:
(b) the expression "PERSON" includes an individual, the
estate of an
4.
<PAGE> 569
individual, a corporation, and a statutory or other
authority or association (incorporated or
unincorporated);
(c) a reference to any party includes that party's executors,
administrators, successors, substitutes and assigns,
including any person taking by way of novation and in the
case of a trustee includes any substituted or additional
trustee;
(d) a reference to the Charged Property includes any part of
it;
(e) a reference to this Charge, to a Transaction Document or
to any other document includes respectively this Charge,
the Transaction Document or that other document as
amended, varied, novated, supplemented, ratified or
replaced from time to time;
(f) a reference to any legislation or to any section or
provision thereof includes any statutory modification,
(g) re-write or re-enactment or any statutory provision
substituted therefor, and all ordinances, by-laws,
regulations and other statutory documents issued
thereunder;
(h) words importing the singular include the plural (and vice
versa) and words denoting a given gender include all
other genders;
(i) a reference to a clause is a reference to a clause of
this Charge;
(j) where any word or phrase is given a defined meaning, any
other part of speech or grammatical form in respect of
that word or phrase has a corresponding meaning;
(k) all accounting terms used in this Charge have the meaning
given under accounting principals and practices generally
accepted in Australia from time to time; and
(l) mentioning anything after "include", "includes" or
"including" does not limit what else may be included.
1.3 DEBENTURE STOCK TRUST DEED
(a) The Chargor and the Security Trustee acknowledge and
agree that this Charge are each a "Transaction Document"
as defined in and for the purposes of the Debenture Stock
Trust Deed.
(b) The Chargor and the Security Trustee agree that this
Charge is a "Collateral Security" as defined in and for
the purposes of the Debenture Stock Trust Deed.
5.
<PAGE> 570
(c) To the extent to which any provision of this Charge is
inconsistent with the Debenture Stock Trust Deed, the
Debenture Stock Trust Deed shall prevail.
1.4 SECURITY TRUSTEE
(a) Any reference to the "Security Trustee" in this Charge
will be construed as referring to the Security Trustee as
trustee for the Stockholders.
(b) As between the Chargor on the one hand and the Security
Trustee and the Stockholders on the other, all action
taken by the Security Trustee under this Charge will be
taken to be authorised and the Chargor need make no
enquiry as to the authority of the Security Trustee.
2. CHARGE
2.1 THE CHARGE
The Chargor both in its personal capacity and as trustee of the PHF Trust
hereby charges all the Charged Property to the Security Trustee to secure
the due and punctual performance, observance and fulfilment of all the
Obligations and the payment in full of the Secured Money.
2.2 ASSETS OVER WHICH THIS CHARGE IS FIXED
This Charge will operate as a fixed charge over the Charged Property
listed below (whether present or future) which does not form part of the
Remaining Property:
(a) all real and leasehold property, and all fixtures and
improvements thereon;
(b) all machinery, vehicles, fittings, furniture, plant and
equipment, computer software and hardware;
(c) the Moran Guarantee, all rights of the Chargor under
any management contract in respect of the Business, the
Moran Lease and all other documents, contracts,
(including leases), rights and records relating to the
Business;
(d) the goodwill of the Business and all Licences;
(e) the Moran Securities and all other Encumbrances,
Marketable Securities, documents of title and
Intellectual Property,
with the intention that each item of future property described in this
clause 2.2 will be specifically charged to the Security Trustee at the
time it is acquired by the Chargor. This
6.
<PAGE> 571
Charge will operate as a floating charge as regards all other Charged
Property (including the Remaining Property).
2.3 DEALING WITH PROPERTY SUBJECT TO FLOATING CHARGE
Subject to any contrary provision in any Transaction Document, the
Chargor may in respect of any part of the Charged Property which is
subject to the floating charge created by this Charge, deal with and pay
or apply that part of the Charged Property in the ordinary course of its
ordinary business.
2.4 AUTOMATIC CRYSTALLISATION OF FLOATING CHARGE
(a) If any Event of Crystallisation occurs, the floating charge
created by this Charge will (except to the extent to which this
Charge is a floating charge over the Remaining Property) at that
time automatically crystallise and immediately become a fixed
charge over that part of the Charged Property not immediately
prior to such occurrence the subject of the fixed charge.
(b) if an Administrator Event occurs the floating charge created by
this Charge will (to the extent to which this Charge is a
floating charge over the Remaining Property) at that time
automatically crystallise and immediately become a fixed charge
over the Remaining Property.
2.5 NOTICE OF CONVERSION
The Security Trustee may at any time by notice in writing to the Chargor
convert or reconvert its security under this Charge from (except in the
case of the Remaining Property) a floating charge to a fixed charge or
from a fixed charge to a floating charge. Any such conversion will be
effective from the moment of receipt of notice of such conversion.
2.6 RECONVERSION
The Security Trustee may at any time by notice in writing to the Chargor
reconvert its security under this Charge from a fixed charge to a
floating charge in respect of any asset or class of asset specified in
that notice.
2.7 CONVERSION TO LEGAL MORTGAGE
If an Event of Default occurs and is not waived or remedied in the period
(if any) permitted in any Transaction Document, at any time thereafter if
such event continues the Security Trustee may procure itself (or its
nominee) to be registered as the holder of any shares forming part of the
Charged Property (other than any shares forming part of the Remaining
Property). Without limiting the generality of the foregoing, the Chargor
irrevocably and unconditionally authorises the Security Trustee to date
and complete any transfers and lodge such transfers for stamping and
registration accompanied by the share certificates relating thereto, if
applicable. The Security Trustee's costs and expenses
7.
<PAGE> 572
relating to the transfer and registration, including stamp duty and other
taxes, will be payable by the Chargor on demand and will form part of the
Secured Money.
2.8 PROSPECTIVE LIABILITY
For the purpose only of section 282(3) of the Corporations Law, the
specified maximum amount of the prospective liability secured by this
Charge is $200,000,000. The nature of the prospective liability is as
shown on the notice lodged with this Charge with the Australian
Securities and Investments Commission. Nothing in this clause 2.8 will
limit, or put the Security Trustee under any obligation to do any act or
thing so as to increase, the amount of the money secured by this Charge.
2.9 LIMITATION
This Charge is security for the due and punctual performance, observance
and fulfilment of all the Obligations and the payment in full of all of
the Secured Money. Nevertheless the amount payable by the Chargor and
ultimately recoverable by the Security Trustee upon enforcement of this
Charge is limited to the greater of:
(a) $7,100,000; and
(b) the aggregate value of the Charged Property determined as
at the date of such enforcement.
3. REPRESENTATIONS AND WARRANTIES
3.1 GENERAL REPRESENTATIONS AND WARRANTIES
The Chargor represents and warrants to the Security Trustee that:
(a) (GOOD TITLE): it has good right to charge the Charged
Property as beneficial owner in the manner provided in
this Charge and in each Collateral Security, and the
Charged Property is free of all Encumbrances;
(b) (LEGALLY BINDING OBLIGATION): this Charge constitutes a
valid and legally binding obligation of the Chargor in
accordance with its terms;
(c) (EXECUTION, DELIVERY AND PERFORMANCE): the execution,
delivery and performance of this Charge by the Chargor
does not violate any Statute or law, or any document or
agreement to which the Chargor is a party or which is
binding on it or any of its assets;
(d) (AUTHORISATION): all consents, licences, approvals and
authorisations of every Government Authority required to
be obtained by the Chargor in connection with the
execution, delivery and performance of this Charge have
been obtained and are valid and subsisting;
8.
<PAGE> 573
(e) (FINANCIAL LIABILITIES): the Chargor is not in default in
the payment of any material sum or in the performance or
observance of any material obligation in respect of any
Financial Liability, and no event has occurred which with
the giving of notice, lapse of time or other condition
could constitute a default in respect of any Financial
Liability;
(f) (NO EVENT OF DEFAULT): no event has occurred which
constitutes an Event of Default or a Potential Event of
Default;
(g) (STATUTES): the Chargor has not failed to comply with any
Statute relative to it or the Business where such failure
may have a material adverse effect on the Chargor's
ability to observe its obligations under the Transaction
Documents; and
(h) (NO TRUSTS): the Chargor is not the trustee of any trust
(other than the PHF Trust) nor does it hold any property
subject to or impressed by any trust (other than the PHF
Trust).
3.2 CORPORATE REPRESENTATIONS AND WARRANTIES
The Chargor further represents and warrants to the Security Trustee that:
(a) (DUE INCORPORATION): it is duly incorporated and has the
corporate power to own its property and to carry on its
business as is now being conducted;
(b) (CONSTITUTION): the execution, delivery and performance
of this Charge does not violate the Constitution of the
Chargor;
(c) (CORPORATE POWER): it has the power, and has taken all
corporate and other action required, to enter into this
Charge and to authorise the execution and delivery of
this Charge and the performance of its obligations under
this Charge; and
(d) (FILINGS): the Chargor has filed all corporate notices
and effected all registrations with the Australian
Securities and Investments Commission and all of those
filings and registrations are current, complete and
accurate.
3.3 TRUST REPRESENTATIONS AND WARRANTIES
The Chargor further represents and warrants to the Security Trustee that:
(a) (TRUSTEE): it enters, or has entered, into this Charge in
its capacity as trustee of the PHF Trust;
9.
<PAGE> 574
(b) (TRUST VALIDLY CREATED): the PHF Trust has been validly
created and is in existence at the date of this Charge;
(c) (TRUSTEE VALIDLY APPOINTED): the Chargor has been validly
appointed as trustee of the PHF Trust and is presently
the sole trustee of the PHF Trust;
(d) (TRUST DEED): the PHF Trust is solely constituted by the
Trust Deed, (a true copy of which has been provided to
the Security Trustee or its agent before the date of this
Charge) and the Trust Deed discloses all the terms of the
PHF Trust other than terms implied by law;
(e) (TRUSTEE'S POWER): it has full and free power to enter
into this deed in its capacity as trustee of the PHF
Trust;
(f) (TRUST AUTHORISATIONS): it has in full force and effect
all authorisations necessary to enter into this deed as
trustee of the PHF Trust, and to perform its obligations
under them;
(g) (NO REMOVAL OF TRUSTEE): no action has been taken or is
proposed to remove it as trustee of the PHF Trust;
(h) (NO DEFAULT OF TRUSTEE): it is not in default under the
Trust Deed which would have the effect of limiting or
removing its right of indemnity from the property of the
PHF Trust, or would affect its power or ability to enter
into this deed (or to perform its obligations under this
deed) as trustee of the PHF Trust;
(i) (TRUST OBLIGATIONS): it has complied with its obligations
in connection with the PHF Trust;
(j) (VESTING DATE NOT DECLARED): a date has not been declared
pursuant to the Trust Deed as the date on which the PHF
Trust will be vested or come to an end, and no other
action has been taken or is proposed to terminate the PHF
Trust;
(k) (NO PROCEEDINGS): no proceedings of any description have
been or are likely to be commenced or threatened which
could have a material adverse effect on the assets or
financial position of the PHF Trust or on its trusteeship
thereof;
(l) (NO ACQUISITION OF TRUST ASSETS): it has not done, or
failed to do, any act whereby any of the assets of the
PHF Trust have been acquired by any other person and no
assets of the PHF Trust are presently registered in the
name of any other person and no person, other than the
Chargor and the beneficiaries of the PHF Trust from time
to time,
10.
<PAGE> 575
has acquired any right of any kind whether vested or
contingent in any asset of the PHF Trust;
(m) (INDEMNITY): it has a right to be fully indemnified out
of the property of the PHF Trust in respect of
obligations incurred by it under this Charge; and
(n) (COMMERCIAL BENEFIT): it is to the commercial benefit of
the PHF Trust that it enters into this Charge in its
capacity, inter alia, as trustee of the PHF Trust.
3.4 REPRESENTATIONS AND WARRANTIES REPEATED
Each representation and warranty in this Charge will be repeated on each
day whilst any of the Secured Money remains outstanding (whether or not
then due for payment) with reference to the facts and circumstances then
subsisting, as if made on each such day.
4. COVENANTS CONCERNING THE CHARGED PROPERTY
4.1 RESTRICTIONS IN RELATION TO THE CHARGED PROPERTY
The Chargor will not without the Security Trustee's prior written consent
(which will not be unreasonably withheld):
(a) (NO ENCUMBRANCES): create, purport or attempt to create
or permit to exist any Encumbrance howsoever ranking over
any part of the Charged Property (other than the
Remaining Property).
(b) (NO SALE, LEASE ETC.): convey, assign, transfer, lease or
otherwise dispose or part with possession of, make any
bailment over, grant any option over or create or permit
to exist any other interest in any part of the Charged
Property whilst that part of the Charged Property is
subject to the fixed charge created in this Charge or in
any Collateral Security;
(c) (NOT TO PREJUDICE): do or permit any act, omission or
thing whereby any part of the Charged Property (other
than the Remaining Property) becomes or could be liable
to surrender, forfeiture or cancellation or becomes
prejudiced in any manner or the value of this Charge as a
security to the Security Trustee becomes or could be
materially lessened;
(d) (ORDINARY COURSE): subject to this Charge, deal with or
attempt to deal with the Charged Property other than in
the ordinary course of its ordinary business;
(e) (AMENDMENTS, ETC): amend, vary, terminate, cancel or
surrender any
11.
<PAGE> 576
Moran Guarantee, any Moran Lease or any Moran Security in
any material respect; or
(f) (STEP): take any step towards doing any of these things.
4.2 INSPECTION
The Chargor will following the occurrence of any Event of Default (or if
the Security Trustee suspects, on reasonable grounds, that an Event of
Default may have occurred) permit the Security Trustee and any employee,
agent or professional adviser of the Security Trustee, to enter any land
or buildings owned or occupied by the Chargor or any Related Body
Corporate of the Chargor (except to the extent to which they form part of
the Remaining Property), at all reasonable times, without notice, to
inspect its condition and to monitor compliance with this Charge (so long
as to do so will not cause the Chargor to be in breach of any Statute or
any lease of such land or buildings).
4.3 PROTECTION OF CHARGED PROPERTY
At the request of the Security Trustee, the Chargor will take or defend
all legal proceedings that the Security Trustee considers necessary or
desirable for the preservation, protection or recovery of all or any part
of the Charged Property.
4.4 CONDUCT OF BUSINESS
The Chargor will carry on and conduct the Business in a proper and
efficient manner and will not change the general character of or
discontinue the Business without the Security Trustee's prior written
consent.
4.5 INTELLECTUAL PROPERTY
The Chargor will maintain and renew all its present and future
Intellectual Property.
4.6 LICENCES
The Chargor will:
(a) (APPLY): apply for (or procure the application for) and
use (or procure that the applicant uses) its best
endeavours to obtain and maintain each licence which is
not held in respect of the Business but which is required
by law to be held;
(b) (RENEW): on or before the time and in the manner
prescribed by the relevant Statute for each Licence,
apply for (or procure the application for) and procure
the renewal of each Licence, and pay or cause to be paid
the renewal fees and other sums required in respect of
the Licence or the renewal of the Licence within the time
allowed and in the manner prescribed by the Statute;
12.
<PAGE> 577
(c) (PRODUCTION OF THE LICENCE): whenever reasonably
requested by the Security Trustee, produce to the
Security Trustee (or procure the production to the
Security Trustee of) each Licence and all receipts for
payments in relation to each Licence;
(d) (NO CANCELLATION): not do, allow or suffer any act,
matter or thing as a result of which any Licence is or
may be surrendered, forfeited, withdrawn, cancelled,
refused or rendered void, or whereby the holder of any
Licence is disqualified permanently or temporarily from
receiving or continuing to hold a Licence, or whereby the
Business may be disqualified permanently or temporarily
from having a Licence; and
(e) (COMPLY WITH STATUTES): procure that the holder of any
Licence complies with all Statutes and all lawful
requirements of every Government Authority in relation to
the Licence (to the extent that such compliance is
necessary to ensure that the Licence is not revoked,
terminated or forfeited) or otherwise does all things
required of the holder.
4.7 SECURITY TRUSTEE ASSUMES NO OBLIGATIONS
The Security Trustee will not be deemed by virtue of this Charge to have
assumed any obligation of the Chargor under any Licence or Statute.
4.8 DOCUMENTS OF TITLE AND OTHER SECURITIES
The Chargor will lodge with the Security Trustee all documents relating
to each Encumbrance under which the Chargor is the Encumbrancee, all
certificates, scrip and other indicia of the Chargor's title or interest
in any Marketable Securities, all negotiable instruments other than
cheques, all real estate leases, and all other documents of title to the
whole or part of the Charged Property (other than the Remaining Property)
immediately on receipt of same.
4.9 POSTPONEMENT OR WAIVER OF ENCUMBRANCES
The Chargor will, if requested by the Security Trustee, immediately
cause:
(a) any Encumbrance which has arisen or which arises from
time to time by operation of law over the Charged
Property (other than the Remaining Property) in favour of
any person (including the Chargor) to be at the Security
Trustee's option postponed in all respects after and
subject to this Charge or to be otherwise discharged,
released or terminated; and
(b) any Financial Liability or other obligation secured by
any such
13.
<PAGE> 578
Encumbrance at the Security Trustee's option to be
waived, released, paid or performed.
5. EVENTS OF DEFAULT
(a) If any Event of Default occurs and while it subsists at
the option of the Security Trustee and notwithstanding
any delay or previous waiver of the right to exercise
that option, all Powers not previously exercisable become
exercisable, and also at the like option of the Security
Trustee, the right of the Chargor to deal with the
Charged Property (other than the Remaining Property)
immediately ceases.
(b) If an Administrator Event occurs then, notwithstanding
any delay or previous waiver of the right to exercise
that option, all Powers in respect of the Remaining
Property not previously exercisable become exercisable
and also at the like option of the Security Trustee, the
right of the Chargor to deal with the Remaining Property
immediately ceases.
Nothing in this paragraph (b) limits paragraph (a) of
this clause 5 or any other provision of this Charge or
any other Transaction Document.
6. RECEIVERS: APPOINTMENT AND POWERS
6.1 APPOINTMENT OF RECEIVER
At any time after the happening of any Event of Default or after the
whole or part of the Secured Money becomes due and payable under the
provisions of this Charge, the Security Trustee may if directed by an
Extraordinary Resolution of Stockholders:
(a) appoint in writing any person or persons to be a receiver
or receiver and manager of the whole or part of the
Charged Property;
(b) withdraw the appointment of that Receiver as to the whole
or part of the Charged Property; and
(c) (in case of the removal, retirement or death of any
Receiver) appoint another person or persons in his place,
PROVIDED THAT the Security Trustee may only exercise its rights and
powers under this clause 6.1 in respect of the Remaining Property if an
Administrator Event has occurred.
6.2 JOINT RECEIVERS
If more than one person is appointed as a Receiver of the whole or any
part of the Charged Property, the Security Trustee may specify whether
the appointment, and the Powers of each appointee, will at its option be
joint, or joint and several, and failing such specification, the
appointment and the Powers of each person will be deemed to be joint and
several.
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6.3 REMUNERATION OF RECEIVER
The Security Trustee may fix the rate of remuneration of any Receiver at
such rate as the Security Trustee from time to time determines, which
rate will not exceed the standard hourly rate from time to time charged
by the firm of which the Receiver is a member for work of the level
conducted by the Receiver.
6.4 AGENT OF THE CHARGOR
Every Receiver will be the agent of the Chargor who will be solely
responsible for all acts and omissions by and the remuneration of the
Receiver.
6.5 POWERS OF RECEIVER
Without the need for any consent by the Chargor, each Receiver will have
all of the powers specified in section 420 of the Corporations Law, and
in addition to those and any other Powers, will have all of the following
powers:
(a) (TAKE POSSESSION): to take possession or control of or
make use of the whole or any part of the Charged Property
or relinquish possession or control;
(b) (CONVERT TO MONEY): to convert, liquidate and reduce the
whole or any part of the Charged Property into money;
(c) (LEASE): whether or not the Receiver has taken
possession, to lease or licence in the name of the
Chargor or otherwise the whole or any part of the Charged
Property, for any period and on any terms or to vary or
terminate a lease or licence;
(d) (CARRY ON BUSINESS): to carry on or concur in carrying on
each Business and do all acts which the Chargor might do
in the ordinary conduct of such Business for the
protection or improvement of the whole or part of the
Charged Property;
(e) (BORROW OR RAISE MONEY): to borrow or raise from the
Security Trustee or any other person any money which may
be required for any purpose, and in the name of the
Chargor or otherwise to secure any money so borrowed or
raised by the grant of any Encumbrance over the whole or
part of the Charged Property (whether in the name of the
Chargor or otherwise) so that the Encumbrance ranks in
priority to, pari passu with or after this Charge. The
Security Trustee will not be bound to inquire as to the
necessity or propriety of any Financial Liability nor be
responsible for the misapplication or non-application of
any money so borrowed or raised;
(f) (ENGAGE): to engage consultants, contractors,
professional advisers,
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agents and employees (including any person associated
with a firm or company in which the Receiver is a member
or in which he is interested, and that person may charge
for his services as if he had been independently retained
at such salaries or remuneration as the Receiver thinks
fit), and the Receiver may act on any advice given by
that person;
(g) (CONDUCT WORKS): to repair, renew, replace, renovate or
clean the Charged Property, to erect any new buildings or
make any improvements to any land forming part of the
Charged Property, and to demolish, alter, rebuild or
extend any existing buildings on the Charged Property;
(h) (SELL PROPERTY): whether or not in possession, to sell or
concur in selling all or any of the Charged Property by
public auction, private treaty or tender, for cash or on
credit, in one lot or in parcels, with or without special
conditions as to title or the time and the mode of
payment of purchase money and on such other terms as the
Receiver thinks fit, with power to defer payment of any
part of the purchase money, whether or not secured by an
Encumbrance from the purchaser, and to buy in and to
rescind or vary any contract for sale, and to resell
without being responsible for loss;
(i) (CONTRACTS FOR SALE): to exercise all or any rights,
powers and remedies of the Chargor under any contract for
sale and to execute those contracts, transfers,
applications for transfer, assignments and assurances of
all or any part of the Charged Property in the name and
on behalf of the Chargor or otherwise, and to do all
other acts and things for implementing and completing any
sale that the Receiver deems necessary;
(j) (SEVER AND SELL FIXTURES): to sever fixtures belonging to
the Chargor and to sell them separately from any other
part of the Charged Property;
(k) (INVEST PROCEEDS AGAINST CONTINGENCIES): if any part of
the Secured Money is contingent, to invest, deposit or
hold the Charged Property in a form or mode of investment
for the time being as the Receiver in its absolute
discretion thinks fit, with like power to vary, transpose
or re-invest the investments or deposits from time to
time until such part of the Secured Money ceases to be
contingent;
(l) (ENTER INTO CONTRACTS): to enter into any contract or
arrangement with any person for any purpose connected
with this Charge or the whole or any part of the Charged
Property or in furtherance of any Power, on such terms
and conditions as the Receiver in its absolute discretion
thinks fit, including without limitation, granting or
conferring options
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<PAGE> 581
to, in favour of or exercisable by any person for the
purpose of or in connection with the sale, purchase,
leasing, hiring, or other dealing with, the whole or any
part of the Charged Property;
(m) (PERFORM CONTRACTS): to perform, observe, carry out,
enforce specific performance of, exercise or refrain from
exercising, the Chargor's rights and powers under, obtain
the benefit of, and to vary or rescind, all contracts and
rights forming part of the Charged Property or entered
into in the exercise of any Power;
(n) (TAKE PROCEEDINGS): to institute, conduct or defend any
proceedings in law, equity or bankruptcy, and to submit
to arbitration, mediation or conciliation, in the name of
the Chargor or otherwise and on any terms, any
proceeding, claim, question or dispute in connection with
the Charged Property or otherwise;
(o) (COMPROMISE): to make any settlement, arrangement or
compromise regarding any action or dispute arising in
connection with the Charged Property; to grant to any
person involved therein time or other indulgence; and to
execute all such releases or discharges in connection
therewith as the Receiver thinks expedient in the
interests of the Security Trustee;
(p) (APPEAL): to appeal against or to enforce any judgment or
order;
(q) (BANKRUPT DEBTORS AND WIND-UP COMPANIES): to make debtors
bankrupt and to wind-up companies and to do all things in
connection with any bankruptcy or winding up which the
Receiver thinks necessary for the recovery or protection
of the whole or part of the Charged Property, or for the
security or other benefit of the Security Trustee;
(r) (DELEGATE): with the consent in writing of the Security
Trustee, to delegate to any person for such time or times
as the Security Trustee approves, any of the Powers,
including this power of delegation;
(s) (FILE): to file all certificates, registrations and other
documents and to take any and all action on behalf of the
Chargor which the Security Trustee or Receiver believes
is necessary to protect, preserve or improve any or all
of the Charged Property and the rights of the Chargor and
the Security Trustee in respect of any agreement for
sale, and to obtain for the Security Trustee and the
Stockholders all of the benefits of this Charge and any
Transaction Document; and in particular, the placing of
the Chargor into liquidation or the appointment of a
Receiver will be deemed to be an event against which the
Security Trustee may protect its rights;
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<PAGE> 582
(t) (MAKE CALLS): to call and get in the uncalled and called
but unpaid nominal or premium capital of the Chargor;
(u) (OPERATE BANK ACCOUNTS): to open or operate any bank
account in the Chargor's name (whether alone or jointly)
to the exclusion of the Chargor, and to deposit or
withdraw any money to the credit of that account, and to
sign and indorse or to authorise others to sign and
indorse in the name of the Chargor cheques, promissory
notes bills of exchange and other negotiable instruments;
(v) (DO ALL OTHER THINGS NECESSARY): to do all things
necessary to perform, observe and fulfil any of the
covenants on the part of the Chargor contained in this
Charge; and
(w) (RECEIVER'S DISCRETION): to do all other acts and things
without limitation as the Receiver thinks expedient in
the interests of the Security Trustee or the
Stockholders,
and any further powers and discretions as the Security Trustee confers on
the Receiver by notice in writing to the Receiver for the purposes
referred to in this clause 6.5,
PROVIDED THAT a Receiver may only exercise the powers referred to in this
clause 6.5 in respect of the Remaining Property if an Administrator Event
has occurred.
6.6 INDEMNITY
The Security Trustee may give any indemnities to the Receiver concerning
the performance of the Receiver's duties as are permitted by law. If the
Security Trustee is obliged to pay any money under any indemnity, that
money will become part of the Secured Money.
7. SECURITY TRUSTEE'S POWERS
7.1 EXERCISE OF POWER
At any time after the happening of any Event of Default or after the
whole or part of the Secured Money becomes due and payable under the
provisions of this Charge the Security Trustee may if directed by an
Extraordinary Resolution of Stockholders without notice and whether or
not a Receiver has been appointed:
(a) exercise all or any of the Powers conferred on a Receiver
or which would be conferred on a Receiver if appointed as
if those Powers had been expressly conferred on the
Security Trustee;
(b) exercise all other Powers; and
(c) appoint an agent or joint and several agents and delegate
such Powers to it or them (in which case clauses 6.1, 6.3
and 6.6 will apply as if
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<PAGE> 583
it or they were appointed as a Receiver),
PROVIDED THAT the Security Trustee may only exercise its rights and
powers under this clause 7.1 in respect of the Remaining Property if an
Administrator Event has occurred.
7.2 ACT JOINTLY
The Security Trustee or Receiver may exercise any of the Powers in
conjunction with the exercise of similar powers by any other Encumbrancee
of the whole or part of the Charged Property or by any receiver appointed
by that other Encumbrancee, and may enter into and give effect to
agreements and arrangements with that other Encumbrancee or receiver as
the Security Trustee or Receiver thinks fit.
7.3 POWER OF ATTORNEY
(a) The Chargor irrevocably appoints the Security Trustee,
each director, manager and attorney from time to time of
the Security Trustee, and any Receiver severally, as its
attorney, with power at any time after the occurrence of
an Event of Default (and to the extent to which the Event
of Default has not been remedied or waived) to:
(i) do all acts which ought to be done by the Chargor
under this Charge or to exercise any Power;
(ii) demand, sue for, recover and receive all or any
part(s) of the Charged Property from any person, in
the name of and on behalf of the Chargor, or in the
name of the Security Trustee or an attorney
appointed under this Charge;
(iii) take further action and to execute further
instruments which are, or are in the opinion of the
Security Trustee, either necessary to more
satisfactorily secure the payment of the Secured
Money or are expedient in relation to the Charged
Property; and
(iv) appoint (and remove at will) at any time any
person(s) as a substitute(s) for an attorney or
attorneys,
PROVIDED THAT an attorney may only exercise rights and powers
under this clause 7.3 in respect of the Remaining Property if an
Administrator Event has occurred (and to the extent to which the
Administrator Event has not been remedied or waived).
(b) The Chargor ratifies and confirms now and for the future
all actions lawfully undertaken by or on behalf of its
attorney under this Power of Attorney.
(c) The Chargor declares that this Power of Attorney will
continue in force until all actions taken under it have
been completed, notwithstanding the discharge of this
Charge or any of the agreements
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<PAGE> 584
or arrangements to which it refers.
7.4 SECURITY TRUSTEE MAY MAKE GOOD ANY DEFAULT
If the Chargor defaults in duly performing, observing and fulfilling any
of the Obligations, the Security Trustee may, without prejudice to any
other Power, do all things and pay all money necessary or expedient in
the opinion of the Security Trustee to make good or to attempt to make
good that default to the satisfaction of the Security Trustee.
7.5 NOTICE FOR EXERCISE OF POWERS
(a) The Powers may be exercised by the Security Trustee and
the Receiver immediately or at any time after an Event of
Default occurs without any notice or lapse of time being
necessary unless required by a law which cannot be
excluded.
(b) One day is fixed as the period for which:
(i) default must continue in the performance,
observance and fulfilment of the whole or any
part of the Obligations, or in the payment of
any part of the Secured Money, including
interest, before the Security Trustee may serve
any notice in writing as required by any Statute
affecting the Powers; and
(ii) default must continue after the service of
notice before any power of sale given by Statute
may be exercised.
8. APPLICATION OF MONEY
8.1 PRIORITY OF PAYMENTS
All money received by the Security Trustee or by the Receiver as a result
of the exercise of the Powers in respect of the Chargor will be applied
in the following order:
(a) (INCIDENTAL TO EXERCISE OF POWERS): in payment of all
costs, charges, expenses and disbursements incurred in or
incidental to the exercise or attempted exercise of any
of the Powers;
(b) (OUTGOINGS): in payment of any other outgoings as the
Receiver or the Security Trustee thinks fit;
(c) (PAYMENT OF SECURED MONEY SECURED BY STOCK): in payment
to the Stockholders of the balance of the Secured Money
(other than the Face Amount) secured by the Stock
(rateably according to the respective amounts of their
respective Secured Money as at the date the payment is
made);
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<PAGE> 585
(d) (PAYMENT OF FACE AMOUNT): in payment to the Stockholders
in respect of the Face Amount secured by the Stock
(rateably according to the respective amounts of their
respective Secured Money as at the date the payment is
made);
(e) (SUBSEQUENT ENCUMBRANCES): in payment of subsequent
Encumbrances of which the Security Trustee is aware in
the order of their priority; and
(f) (SURPLUS): the surplus (if any) belongs to the Chargor
but does not carry interest.
8.2 CONTINGENT INDEBTEDNESS
If the Security Trustee receives money in connection with this Charge
when part of the Secured Money is contingently or prospectively owing,
then the Security Trustee must deposit an amount not exceeding that part
in an interest-bearing deposit account with a bank on such terms as the
Security Trustee thinks fit until that part becomes actually payable or
no longer falls within the definition of "Secured Money". At that time
the Security Trustee may retain for its own account the amount which is
then actually payable to it. The balance is to be paid in accordance with
clause 8.1.
8.3 MONEY RECEIVED
In applying any money towards satisfaction of the Secured Money, the
Chargor will be credited only with as much of the money available for
that purpose as will be actually received by the Security Trustee or the
Receiver and is not required for whatever reason to be disgorged, a
credit to date from the time of receipt.
8.4 APPLICATION OF PAYMENTS OR CREDITS
Subject to this clause 8, each of the Security Trustee and the Receiver
has an absolute discretion to apply any payment or credit received by it
under this Charge in reduction of any part or parts of the Secured Money,
whenever and on whatever account the same became secured, notwithstanding
any principle or presumption of law to the contrary or any direction
given at the time of receipt, and without the need to communicate its
election to any person.
8.5 RELIANCE ON CERTIFICATE
In making any payment to any other Encumbrancee under clause 8.1, the
Security Trustee and the Receiver may rely on a certificate from that
Encumbrancee as to the amount secured, and are not bound to enquire as to
the accuracy of the certificate or whether the amount referred to is
validly secured by the Encumbrance.
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9. LIABILITY AND RELEASE
9.1 CONTINUING OBLIGATION
This Charge constitutes a continuing obligation regardless of any
settlement of account, intervening payment, express or implied
revocation, or any other matter or thing. Without limiting the generality
of the foregoing, each indemnity in this Charge is a separate additional
and continuing obligation and will survive the discharge of this Charge.
Unless otherwise agreed, payment by the Security Trustee will not be a
pre-condition to liability under any indemnity.
9.2 PERSONAL LIABILITY
Notwithstanding any payout figure quoted or other form of account stated
by the Security Trustee, and notwithstanding the rule in Groongal
Pastoral Company Limited (In Liquidation) v. Falkiner (1924) 35 CLR 157,
no grant of full or partial satisfaction of or discharge from this Charge
by the Security Trustee will release the Chargor from personal liability
under this Charge or under any Transaction Document until all the Secured
Money has in fact been received by the Security Trustee and is not liable
to be disgorged, notwithstanding that the quotation or statement of
account has arisen from the mistake, negligence, error of law or error of
fact of the Security Trustee, its servants or agents.
9.3 SETTLEMENT CONDITIONAL
Any settlement or discharge between the Chargor and the Security Trustee
is conditional on any security or payment given or made to the Security
Trustee by the Chargor or any other person in relation to the Obligations
not being avoided, repaid or reduced by virtue of any Insolvency
Provision. If the security or payment is avoided, repaid or reduced, the
Security Trustee is entitled to recover the value or amount of such
security or payment avoided, repaid or reduced from the Chargor
subsequently as if that settlement or discharge had not occurred.
9.4 CHARGOR'S LIABILITY NOT AFFECTED
The liability of the Chargor under this Charge:
(a) (ABSOLUTE): is absolute and is not subject to the
execution of any Transaction Document or any other
document by any person or to the performance of any
condition precedent or subsequent;
(b) (NOT AFFECTED): will not be affected by any act,
omission, matter or thing that would otherwise operate in
law or in equity to reduce or release the Chargor from
its liability including, without limiting the generality
of the foregoing, any of the following:
(i) the occurrence of any Event of Default;
(ii) the receipt by the Security Trustee of any
payment,
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<PAGE> 587
dividend or distribution under any Insolvency
Provision in relation to the Chargor;
(iii) any Transaction Document or any payment the
making of which would otherwise have formed part
of the Secured Money being or becoming or being
conceded to be illegal, invalid, void, voidable,
unenforceable or irrecoverable in whole or in
part for any reason whether past, present or
future, including, without limiting the
generality of the foregoing:
A. any Statute, other law or principle of
equity;
B. any act or omission by any person;
C. any legal limitation, disability or
incapacity of the Chargor;
D. any improper exercise of a Power;
E. any Power being suspended or postponed by
Statute, any court order or otherwise; or
F. any Insolvency Provision;
(iv) the Security Trustee accepting any Transaction
Document;
(v) the Security Trustee granting time, waiver or
other indulgence or concession to, or to making
any composition or compromise with, the Chargor;
(vi) the Security Trustee forbearing or neglecting to
exercise any remedy or right it has for the
enforcement of any Transaction Document or any
of the Obligations;
(vii) any laches, acquiescence or other act, neglect,
default, omission or mistake by the Security
Trustee;
(viii) the determination, rescission, repudiation or
termination, or the acceptance of any of the
foregoing, by the Security Trustee or the
Chargor of any Transaction Document or any of
the Obligations;
(ix) execution of any Transaction Document or any
variation to any Transaction Document or any of
the Obligations, whether or not such event
imposes an additional liability upon or is
onerous on the Chargor;
(x) the full, partial or conditional release or
discharge by the Security Trustee or by
operation of law, of any person from any
Transaction Document or any of the Obligations;
(xi) the release of any property from any Transaction
Document or the substitution of any property in
place of any other property now or hereafter the
subject of a Transaction Document;
(xii) the Security Trustee wasting, destroying,
abandoning, prejudicing or not perfecting,
maintaining, preserving, enforcing or realising
or not properly enforcing or realising a
Transaction Document;
(xiii) the failure to obtain any Transaction Document
or the loss or impairment of any Transaction
Document by operation
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<PAGE> 588
of law or otherwise, whether or not the same is
in breach of an express or implied condition to
obtain or preserve such Transaction Document or
in breach of any equitable duty which might
otherwise have been imposed upon the Security
Trustee;
(xiv) the postponement or loss of the priority
attaching to any Transaction Document;
(xv) the opening or operation of any new account with
the Security Trustee by the Chargor;
(xvi) any change in membership (whether by death or
retirement of an existing member, admission of a
new member or otherwise) or name of any
partnership, firm or association in which the
Chargor is a member;
(xvii) the transfer or assignment of the benefit of any
Transaction Document or of any of the
Obligations;
(xviii) any failure by the Security Trustee to disclose
to the Chargor any material or unusual fact,
circumstance, event or thing whatsoever known
to, or which ought to have been known by, the
Security Trustee relating to or affecting the
Chargor at any time prior to or during the
currency of any Transaction Document, whether
prejudicial or not to the rights and liabilities
of the Chargor and whether or not the Security
Trustee was under any duty of disclosure; or
(xix) the Security Trustee entering into a covenant
with the Chargor not to sue, issue process, sign
or execute judgment, commence proceedings for
bankruptcy or liquidation, participate in any
scheme of arrangement or reconstruction, prove
in any bankruptcy or liquidation or do any other
act, matter or thing in respect of the liability
of the Chargor.
9.5 RELEASE OF CHARGED PROPERTY
The Security Trustee will be under no obligation to grant a release of
the Charged Property from this Charge unless at the time the release is
to be provided, none of the Secured Money is owing (whether actually,
contingently, or prospectively), none of the Obligations remain to be
performed and it is not reasonably foreseeable that there could be any
money owing or Obligations to be performed at a future time.
10. PROTECTION AND INDEMNITY
10.1 WAIVER BY THE CHARGOR
The Chargor waives in favour of the Security Trustee:
(a) all rights against the Security Trustee and any other
person, estate or assets as far as is necessary to give
effect to any provision of this
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<PAGE> 589
Charge;
(b) promptness and diligence on the part of the Security
Trustee, and any other requirement that the Security
Trustee take any action or exhaust any right against any
other person before enforcing this Charge; and
(c) all rights inconsistent with the provisions of this
Charge, including any rights of contribution or
subrogation which the Chargor might otherwise be entitled
to claim or enforce.
10.2 NO LIABILITY FOR LOSS
Neither the Security Trustee nor any Receiver will be liable or otherwise
accountable for any omission, delay or mistake, or any loss or
irregularity in or about the exercise, attempted exercise, non-exercise
or purported exercise of any Power, except for actual fraud or wilful
misconduct.
10.3 NO LIABILITY TO ACCOUNT
Neither the Security Trustee nor any Receiver will, by reason of the
Security Trustee or the Receiver entering into possession of the whole or
part of the Charged Property, be liable to account as mortgagee or
Security Trustee in possession, or for any loss on realisation or for any
default, omission, delay or mistake for which a mortgagee or Security
Trustee in possession might be liable.
10.4 NO CONFLICT
The Security Trustee and any Receiver may exercise any Power
notwithstanding that the exercise of that Power involves a conflict
between any duty owed to the Chargor by the Security Trustee or that
Receiver and any duty owed by the Security Trustee or Receiver to any
other person, or the interests of the Security Trustee or Receiver. No
contract will be void or voidable by virtue of any such conflict of duty
or interest, nor will the Security Trustee or Receiver be liable to
account to the Chargor or any other person for any money or property as a
result of such conflict.
10.5 NO NOTICE OR ENFORCEMENT
The Security Trustee need not give any notice of this Charge to any
debtor of the Chargor, or to any purchaser, or to any other person, or to
enforce payment of any money payable to the Chargor, or realise any of
the Charged Property, or to take any steps or proceedings for that
purpose.
10.6 INDEMNITY
The Chargor will on demand indemnify and keep the Security Trustee
indemnified in respect of all costs, expenses, liabilities and losses
incurred by the Security Trustee or the Receiver:
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(a) in the exercise, attempted exercise or non-exercise of
any Power, including (without limitation) those
consequent on any mistake, oversight, error of judgment
or want of prudence on the part of the Security Trustee
or the Receiver, unless the same is due to actual fraud
or wilful misconduct;
(b) as a consequence of the occurrence of any Event of
Default;
(c) by reason of this Charge;
(d) in respect of any act or omission for which the Security
Trustee or the Receiver is exonerated by this Charge; and
(e) by reason of the Security Trustee redeeming or taking a
transfer of any Encumbrance ranking in priority to or
pari passu with this Charge,
and the Chargor will defend all actions, proceedings, claims or demands
brought by any person in relation to any matter the subject of this
indemnity.
10.7 PROTECTION OF PERSONS DEALING WITH THE SECURITY TRUSTEE OR
RECEIVER
No person acquiring any money or asset from or paying or handing over any
money or asset to or otherwise dealing with the Security Trustee, the
Receiver or any attorney appointed under this Charge, or to whom is
tendered for registration an instrument executed by the Security Trustee,
the Receiver or any attorney appointed under this Charge, will be:
(a) bound to inquire:
(i) whether any Event of Default has occurred;
(ii) whether any of the Secured Money is owing or
payable;
(iii) whether the Receiver or attorney has been
properly appointed;
(iv) as to the propriety or regularity of the exercise
or purported exercise of any Power; or
(v) as to any other matter or thing;
(b) affected by actual or constructive notice that any
transaction, document or other dealing is unnecessary or
improper; or
(c) concerned to see to the application of any money or
asset, or be answerable or accountable for any loss or
misapplication,
and the irregular, improper or unnecessary exercise of any Power will be,
as regards the protection of any such person, deemed to be authorised by
the Chargor, and valid.
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11. PAYMENTS
11.1 CREDIT BALANCES OF OTHER ACCOUNTS
In determining the Secured Money, no credit need be allowed by the
Security Trustee or any Stockholder for any credit balance in any joint
or other account of the Chargor with either of them, or for any other
money owing by the Security Trustee or any Stockholder to the Chargor.
11.2 PAYMENT OF INTEREST
The Chargor will pay interest on the Secured Money to the Security
Trustee or any Stockholder in accordance with each Transaction Document,
and in the absence of any relevant provision, to the Security Trustee at
the Specified Rate calculated on daily balances computed from the time or
respective times when the money becomes owing to, or is paid by, the
Security Trustee or Stockholder. Interest accrues daily, and is payable
on the earlier of a demand from the Security Trustee (made at the request
of a Stockholder) or the last Banking Day of each calendar month, whilst
the Secured Money remains outstanding.
11.3 CAPITALISATION OF INTEREST
The Security Trustee or any Stockholder may capitalise any interest which
has become due and owing in accordance with any Transaction Document or
in the absence of any relevant provision then at such periods of not less
than one calendar month and from such dates as the Security Trustee or
that Stockholder elects. The accumulation of capitalised interest may
continue until the Secured Money has been paid in full, notwithstanding
any composition, compromise, judgment or order in respect of any person
or any other matter.
11.4 MERGER
If the liability of the Chargor to pay any of the Secured Money to the
Security Trustee or any Stockholder becomes merged in any judgment or
order, the Chargor will, as an independent obligation, pay interest at
the rate which is the higher of that payable under this Charge and that
fixed by or payable under that judgment or order.
11.5 NO DEDUCTION FOR TAXES AND NO SET-OFF OR COUNTERCLAIM
Subject to any Transaction Document, all payments of Secured Money by the
Chargor to the Security Trustee or a Stockholder will be:
(a) free of any set-off or counterclaim; and
(b) subject to any Statute, without deduction or withholding
for any present or future Taxes.
27.
<PAGE> 592
11.6 CURRENCY CONVERSION AND INDEMNITY
(a) If any amount is required to be paid in a particular
currency and the Security Trustee receives payment in
another currency, the Security Trustee may actually or
notionally convert the amount received into the required
currency at the spot rate which it is or considers it
would be able to obtain in the market at the time
following receipt when it sees fit to make the
conversion. The Chargor will only satisfy its obligation
to pay in the required currency to the extent of the
amount actually or notionally received after deducting
the costs of conversion.
(b) The Chargor agrees to indemnify the Security Trustee for
any deficiency which arises for any reason between the
amount actually received under any judgment, court or
tribunal order or distribution under any Insolvency
Provision which takes into account any currency
conversion rate and the amount which would be actually or
notionally received by the Security Trustee by applying
the conversion provided for in this clause.
12. EXPENSES, STAMP DUTIES AND REGISTRATION
12.1 EXPENSES
The Chargor on demand will reimburse the Security Trustee for and keep
the Security Trustee indemnified against all expenses, including legal
fees, costs and disbursements (on a solicitor/own client basis) incurred
by the Security Trustee in connection with:
(a) (PREPARATION): the preparation, negotiation and execution
of the Transaction Documents and any subsequent consent,
agreement, waiver, amendment to, or discharge of any of
them; and
(b) (ENFORCEMENT): the exercise, enforcement, preservation,
or attempted exercise, enforcement or preservation of any
rights under the Transaction Documents, including without
limitation any expenses incurred in the evaluation of any
matter of material concern to the Security Trustee or any
Stockholder.
The Chargor will bear the cost of its compliance with the Transaction
Documents.
12.2 STAMP DUTIES
(a) (PAYMENT OF ALL DUTIES): The Chargor will pay all stamp
duty, loan transaction, registration and similar Taxes,
including fines and penalties, financial institutions
duty and debits tax which may be payable to or required
to be paid by any appropriate authority, or determined to
be payable in connection with the execution, delivery,
performance or enforcement of this Charge, or any
payment, receipt
28.
<PAGE> 593
or other transaction contemplated by this Charge.
(b) (INDEMNITY): The Chargor will indemnify the Security
Trustee against any loss or liability incurred or
suffered by it as a result of the delay or failure by the
Chargor to pay Taxes.
12.3 REGISTRATION
The Chargor will ensure that this Charge is registered in the manner and
within such time limits as may be prescribed by law to ensure the full
efficacy of this Charge as a security to the Security Trustee in all
relevant jurisdictions.
13. GOVERNING LAW AND JURISDICTION
13.1 GOVERNING LAW
This Charge is to be governed by and construed in accordance with the
laws of New South Wales.
13.2 JURISDICTION
(a) (ACCEPTANCE OF JURISDICTION): The Chargor irrevocably
submits to and accepts generally and unconditionally the
non-exclusive jurisdiction of the courts and appellate
courts of New South Wales with respect to any legal
action or proceedings which may be brought at any time
relating in any way to this Charge.
(b) (NO OBJECTION TO INCONVENIENT FORUM): The Chargor
irrevocably waives any objection it may now or in the
future have to the venue of any such action or
proceedings, and any claim it may now or in the future
have that action or proceeding has been brought in an
inconvenient forum.
14. MISCELLANEOUS
14.1 CONFIDENTIALITY
(a) Subject to clause 14.1(b) the Security Trustee and the
Stockholders will not disclose any confidential or
unpublished information or documents supplied by the
Chargor in connection with the Transaction Documents
which are specifically indicated by the Chargor to be
confidential.
(b) The Security Trustee and the Stockholders will be
entitled to disclose any confidential information or
documents:
(i) to a Stockholder;
29.
<PAGE> 594
(ii) in any proceeding arising out of or in connection
with any Transaction Document to the extent that
such disclosure is deemed by that person necessary
to protect its interests;
(iii) if required to do so under a binding order of any
Government Authority or any procedure for
discovery in any proceedings;
(iv) if required to do so under any law or any
administrative guideline, directive, request or
policy whether or not having the force of law and,
if not having the force of law, the observance of
which is in accordance with the practice of
responsible trustees, bankers or financial
institutions;
(v) otherwise as required or permitted by any
Transaction Document;
(vi) to its legal advisers and its consultants as long
as it advises them of the confidential nature of
the information or documents or that nature is
clear from the circumstances of the disclosure;
(vii) to a proposed Stockholder or assignee or
transferee from a Stockholder with the prior
written consent of the Chargor which consent will
not unreasonably be withheld or delayed and will
be deemed to have been given if not refused within
5 Banking Days of a request therefore; or
(viii) with the Chargor's prior written consent.
(c) This clause 14.1 survives the termination of this Charge.
14.2 FURTHER ASSURANCE
The Chargor will, and will procure that, all persons having or claiming
any estate or interest in the whole or part of the Charged Property from
time to time and at all times after the date of this Charge on the
request of the Security Trustee and at the cost of the Chargor, will
make, do and execute or cause to be made, done and executed all acts,
deeds and assurances for:
(a) more satisfactorily securing to the Security Trustee the
payment of the Secured Money;
(b) assuring or more satisfactorily assuring the Charged
Property to the Security Trustee, or as the Security
Trustee may direct; or
(c) facilitating the exercise of any Power.
In particular, whenever requested to do so by the Security Trustee, the
Chargor will execute in favour of the Security Trustee legal mortgages,
transfers, assignments or other assurances of the Charged Property in
terms acceptable to the Security Trustee.
30.
<PAGE> 595
14.3 CERTIFICATE OF SECURITY TRUSTEE
A certificate in writing signed by an officer of the Security Trustee
certifying the amount payable by the Chargor to the Security Trustee or
stating any other act, matter or thing relating to this Charge or any
Transaction Document is conclusive and binding on the Chargor in the
absence of manifest error on the face of the certificate.
14.4 NOTICES
Any notice or other communication served, given or made under or in
connection with this Charge or any Collateral Security to which the
Chargor is a party:
(a) must be in writing in order to be valid;
(b) is sufficient if executed by the party serving, giving or
making the same or on its behalf by any attorney,
director, secretary, other duly authorised officer or
solicitor of such party;
(c) will be deemed to have been duly served, given or made in
relation to a party if it is delivered or posted by
prepaid post to the address, or sent by facsimile to the
number of that party set out in the Transaction Documents
or notified in writing by that party to the other parties
from time to time; and
(d) will be deemed to be served, given or made:
(i) (in the case of prepaid post) on the fifth day
after the date of posting;
(ii) (in the case of facsimile) on receipt of a
transmission report confirming successful
transmission; and
(iii) (in the case of delivery by hand) on delivery.
14.5 ASSIGNMENT
(a) (CHARGE BINDS ASSIGNS): This Charge will be binding on
and inure to the benefit of the Chargor, the Stockholders
and the Security Trustee and their respective successors
and assigns.
(b) (ASSIGNMENT BY THE CHARGOR): Notwithstanding clause
14.5(a), the Chargor may not assign or transfer all or
any part of its rights or obligations under this Charge
without the prior written consent of the Security Trustee
acting on the instructions of all the Stockholders.
14.6 NO MERGER
Neither this Charge, any Collateral Security nor any of the Powers will
merge or prejudicially affect or be merged in or prejudicially affected
by and the Chargor's
31.
<PAGE> 596
obligations under this Charge will not in any way be abrogated or
released by any other security, any judgment or order, any contract, any
cause of action or remedy, or any other matter or thing now or hereafter
existing in respect of the Secured Money.
14.7 SEVERABILITY OF PROVISIONS
Any provision of a Transaction Document which is illegal, void or
unenforceable will be ineffective to the extent only of that illegality,
voidness or unenforceability without invalidating the remaining
provisions.
14.8 POWERS CUMULATIVE
Each Power is cumulative and in addition to each other Power available to
the Security Trustee or the Receiver.
14.9 WAIVER
A failure to exercise or enforce or a delay in exercising or enforcing or
the partial exercise or enforcement of any Power by the Security Trustee
will not in any way preclude, or operate as a waiver of, any further
exercise or enforcement of that or any other Power.
14.10 CONSENTS
Any waiver or consent given by the Security Trustee under this Charge may
be given or withheld and may be given subject to any conditions, as the
Security Trustee thinks fit in its absolute discretion unless this Charge
expressly provides otherwise.
14.11 WRITTEN WAIVER AND CONSENT
Any waiver or consent given by the Security Trustee under this Charge or
any Collateral Security will only be effective and binding on the
Security Trustee if it is given or confirmed in writing.
14.12 TIME OF ESSENCE
Time is of the essence in respect of the Chargor's obligations under this
Charge or any Collateral Security.
14.13 MORATORIUM LEGISLATION
To the fullest extent permitted by law, the provisions of all Statutes at
any time operating directly or indirectly to lessen or affect in favour
of the Chargor any obligation under this Charge or any Collateral
Security, or to delay or otherwise prevent or prejudicially affect the
exercise of any Power, are expressly waived, negatived and excluded.
32.
<PAGE> 597
14.14 BINDING ON EACH SIGNATORY
This Charge is binding on each of the signatories notwithstanding that
any one or more of the named parties does not execute this Charge, or
that there is any invalidity, forgery or irregularity touching any
execution of this Charge, or that this Charge is or becomes
unenforceable, void or voidable against a named party.
14.15 COUNTERPARTS
This Charge may be executed in a number of counterparts, all of which
taken together will be deemed to constitute one and the same document.
14.16 NO REPRESENTATION BY OR RELIANCE ON SECURITY TRUSTEE
The Chargor does not enter into this Charge in reliance on or as a result
of any representation, promise, statement, conduct or inducement by or on
behalf of the Security Trustee or any Stockholder otherwise than as set
out in the Transaction Documents.
33.
<PAGE> 598
SCHEDULE
<TABLE>
<CAPTION>
NAME ADDRESS FOLIO IDENTIFIER
NSW
<S> <C> <C>
Annandale Nursing Home 76 Johnston Street, Auto Consol
Annandale NSW 2038 9867-46
Armon Nursing Home 42 Croydon Street, 1/110079
Petersham NSW 2049
Bathurst Nursing Home 61 Boyd Street, 11/806355
Kelso NSW 2795
Bossley Park Nursing Home 52-64 Quarry Street, Bossley 8/713734
Park NSW 2176
Canterbury District Nursing 20 Albert Street, 1/549851
Home Campsie NSW 2194
Crest Nursing Home 11 Johnston Street, 1/913045 and 1/913044
Annandale NSW 2038
Dubbo Nursing Home 80 Muller Street, 12/592842
Dubbo NSW 2830
Fernleigh Nursing Home 8 Sherbrooke Road, 4/201757 and 1/201757
West Ryde NSW 2114
Maitland Nursing Home Broughton Street, Rutherford 5/733509
NSW 2320
Mudgee Nursing Home 207-213 Denison Street, 1/261314
Mudgee NSW 2850
Murwillumbah Nursing Cnr North Arm Road and 1/786640
Home Ingram Place,
Murwillumbah NSW 2484
Narrandera Nursing Home Chantilly Street, 2/582847
Narrandera NSW 2700 308/257212
Norah Head Nursing Home 63 Palomar Parade, 721/26247 and
Toukley NSW 2263 509/26247
Quakers Hill Nursing Home 35 Hambledon Road, 10/860042
Quakers Hill NSW 2763
Shoalhaven Nursing Home Brinawarr Street, 5/614886
Bomaderry NSW 2541
</TABLE>
34.
<PAGE> 599
<TABLE>
<CAPTION>
NAME ADDRESS FOLIO IDENTIFIER
<S> <C> <C>
Stanmore Nursing Home 66 Cambridge Street, 31/7/1
Stanmore NSW 2048
</TABLE>
35.
<PAGE> 600
<TABLE>
<CAPTION>
NAME ADDRESS FOLIO IDENTIFIER
QUEENSLAND
<S> <C> <C>
Caloundra Nursing Home Lyon Street, Lot 2, RP 177466
Caloundra QLD 4551
Nambour Nursing Home 9 Princess Crescent, Lot 2, RP 183823
Nambour QLD 4560
WESTERN AUSTRALIA
Apple Cross Nursing Home 30 Carron Road, Vol. 1964 Fol 640
Apple Cross WA 6153
Armadale Nursing 21 Angelo Street, Vol 1951 Fol 293
Centre/Hillview Nursing Armadale WA 6112
Home
Bunbury Nursing Home 39 Hayes Street, Vol 1534 Fol 995
Bunbury WA 6230
Geraldton Nursing Home 20 Milford Street, Vol. 1539 Fol 329
Geraldton WA 6530 Vol. 1890 Fol 506
Kalgoorlie Nursing Home Dugan Street, Vol. 1597 Fol 789
Kalgoorlie WA 6430
Narrogin Nursing Home 52 Williams Road Vol. 1634 Fol 809
Narrogin WA 6312
Murray River Nursing Home Cnr Coolibah & Boundary Vol. 1697 Fol 190
Roads,
Dudley Park,
Mandurah WA 6210
</TABLE>
36.
<PAGE> 601
EXECUTED as a deed.
<TABLE>
<S><C>
SIGNED SEALED AND DELIVERED )
for and on behalf of PRINCIPAL ) ....................................................
HEALTHCARE FINANCE PTY ) (Signature)
LIMITED, ACN 069 875 476 )
by its Attorney under a )
Power of Attorney dated and )
who declares that he has not received any )
notice of the revocation of such Power of )
Attorney in the presence of: )
</TABLE>
....................................................
(Signature of Witness)
....................................................
(Name of Witness in Full) )
<TABLE>
<S><C>
SIGNED SEALED AND DELIVERED )
for and on behalf of ABN AMRO ) ....................................................
FACILITIES AUSTRALIA LIMITED, ) (Signature)
ACN 001 035 543 )
by its Attorney under a )
Power of Attorney dated and )
who declares that he has not received any )
notice of the revocation of such Power of )
Attorney in the presence of: )
</TABLE>
....................................................
(Signature of Witness)
....................................................
(Name of Witness in Full) )
37.
<PAGE> 602
TABLE OF CONTENTS
<TABLE>
<CAPTION>
CLAUSE PAGE
<S> <C> <C>
1. DEFINITIONS AND INTERPRETATION 1
1.1 DEFINITIONS 1
1.2 INTERPRETATION 4
1.3 DEBENTURE STOCK TRUST DEED 5
1.4 SECURITY TRUSTEE 5
2. CHARGE 5
2.1 THE CHARGE 5
2.2 ASSETS OVER WHICH THIS CHARGE IS FIXED 6
2.3 DEALING WITH PROPERTY SUBJECT TO FLOATING CHARGE 6
2.4 AUTOMATIC CRYSTALLISATION OF FLOATING CHARGE 6
2.5 NOTICE OF CONVERSION 6
2.6 RECONVERSION 7
2.7 CONVERSION TO LEGAL MORTGAGE 7
2.8 PROSPECTIVE LIABILITY 7
2.9 LIMITATION 7
3. REPRESENTATIONS AND WARRANTIES 7
3.1 GENERAL REPRESENTATIONS AND WARRANTIES 7
3.2 CORPORATE REPRESENTATIONS AND WARRANTIES 8
3.3 TRUST REPRESENTATIONS AND WARRANTIES 9
3.4 REPRESENTATIONS AND WARRANTIES REPEATED 10
4. COVENANTS CONCERNING THE CHARGED PROPERTY 10
4.1 RESTRICTIONS IN RELATION TO THE CHARGED PROPERTY 10
4.2 INSPECTION 11
4.3 PROTECTION OF CHARGED PROPERTY 11
4.4 CONDUCT OF BUSINESS 11
4.5 INTELLECTUAL PROPERTY 11
4.6 LICENCES 11
4.7 SECURITY TRUSTEE ASSUMES NO OBLIGATIONS 12
4.8 DOCUMENTS OF TITLE AND OTHER SECURITIES 12
4.9 POSTPONEMENT OR WAIVER OF ENCUMBRANCES 12
5. EVENTS OF DEFAULT 12
6. RECEIVERS: APPOINTMENT AND POWERS 13
6.1 APPOINTMENT OF RECEIVER 13
</TABLE>
(i)
<PAGE> 603
TABLE OF CONTENTS
<TABLE>
<CAPTION>
CLAUSE PAGE
<S> <C> <C>
6.2 JOINT RECEIVERS 13
6.3 REMUNERATION OF RECEIVER 13
6.4 AGENT OF THE CHARGOR 13
6.5 POWERS OF RECEIVER 13
6.6 INDEMNITY 16
7. SECURITY TRUSTEE'S POWERS 16
7.1 EXERCISE OF POWER 16
7.2 ACT JOINTLY 17
7.3 POWER OF ATTORNEY 17
7.4 SECURITY TRUSTEE MAY MAKE GOOD ANY DEFAULT 18
7.5 NOTICE FOR EXERCISE OF POWERS 18
8. APPLICATION OF MONEY 18
8.1 PRIORITY OF PAYMENTS 18
8.2 CONTINGENT INDEBTEDNESS 19
8.3 MONEY RECEIVED 19
8.4 APPLICATION OF PAYMENTS OR CREDITS 19
8.5 RELIANCE ON CERTIFICATE 19
9. LIABILITY AND RELEASE 19
9.1 CONTINUING OBLIGATION 19
9.2 PERSONAL LIABILITY 20
9.3 SETTLEMENT CONDITIONAL 20
9.4 CHARGOR'S LIABILITY NOT AFFECTED 20
9.5 RELEASE OF CHARGED PROPERTY 22
10. PROTECTION AND INDEMNITY 22
10.1 WAIVER BY THE CHARGOR 22
10.2 NO LIABILITY FOR LOSS 22
10.3 NO LIABILITY TO ACCOUNT 22
10.4 NO CONFLICT 22
10.5 NO NOTICE OR ENFORCEMENT 23
10.6 INDEMNITY 23
10.7 PROTECTION OF PERSONS DEALING WITH THE SECURITY TRUSTEE OR RECEIVER 23
11. PAYMENTS 24
11.1 CREDIT BALANCES OF OTHER ACCOUNTS 24
</TABLE>
(ii)
<PAGE> 604
TABLE OF CONTENTS
<TABLE>
<CAPTION>
CLAUSE PAGE
<S> <C> <C>
11.2 PAYMENT OF INTEREST 24
11.3 CAPITALISATION OF INTEREST 24
11.4 MERGER 24
11.5 NO DEDUCTION FOR TAXES AND NO SET-OFF OR COUNTERCLAIM 24
11.6 CURRENCY CONVERSION AND INDEMNITY 25
12. EXPENSES, STAMP DUTIES AND REGISTRATION 25
12.1 EXPENSES 25
12.2 STAMP DUTIES 25
12.3 REGISTRATION 26
13. GOVERNING LAW AND JURISDICTION 26
13.1 GOVERNING LAW 26
13.2 JURISDICTION 26
14. MISCELLANEOUS 26
14.1 CONFIDENTIALITY 26
14.2 FURTHER ASSURANCE 27
14.3 CERTIFICATE OF SECURITY TRUSTEE 27
14.4 NOTICES 27
14.5 ASSIGNMENT 28
14.6 NO MERGER 28
14.7 SEVERABILITY OF PROVISIONS 28
14.8 POWERS CUMULATIVE 28
14.9 WAIVER 28
14.10 CONSENTS 29
14.11 WRITTEN WAIVER AND CONSENT 29
14.12 TIME OF ESSENCE 29
14.13 MORATORIUM LEGISLATION 29
14.14 BINDING ON EACH SIGNATORY 29
14.15 COUNTERPARTS 29
14.16 NO REPRESENTATION BY OR RELIANCE ON SECURITY TRUSTEE 29
</TABLE>
(iii)
<PAGE> 605
DEED OF CHARGE (QLD)
DATE:
PRINCIPAL HEALTHCARE FINANCE PTY LIMITED
Chargor
ABN AMRO FACILITIES AUSTRALIA LIMITED
Security Trustee
(C) Copyright Clayton Utz
Liability is limited by the Solicitors Scheme under the
Professional Standards Act 1994 NSW
<PAGE> 606
DEED OF CHARGE (WA) made at on 1998
BETWEEN PRINCIPAL HEALTHCARE FINANCE PTY LIMITED, ACN 069 875
476 both in its personal capacity and in its capacity
as trustee of the PHF Trust ("CHARGOR")
AND ABN AMRO FACILITIES AUSTRALIA LIMITED, ACN 001 035 543
as trustee of the Premier Care Australia Security Trust
("SECURITY TRUSTEE")
THIS DEED PROVIDES
1. DEFINITIONS AND INTERPRETATION
1.1 DEFINITIONS
In this Charge words which are defined in the Debenture Stock Trust
Deed and which are not defined in this Charge have the same meaning
when used in this Charge and:
"ADMINISTRATOR EVENT" means either:
(a) an administrator is appointed to the Chargor; or
(b) a proposal is made by any person to appoint an
administrator to the Chargor.
"APPROVED AGED CARE ASSETS" means assets that the Chargor proposes
to acquire (or which have been acquired, as the context requires)
from Moran Health Care Group Pty Limited (or any of its Related
Bodies Corporate).
"ASSOCIATED RIGHTS" means, in relation to any property:
(a) all rights, powers and remedies of the Chargor for the
enforcement of such property; and
(b) all rights and powers of the Chargor to vary,
repudiate, rescind, avoid, waive any right under, or
terminate any agreement or arrangement relating to such
property.
"BUSINESS" means the business conducted by the Chargor in
connection with the Approved Aged Care Assets, including the
acquisition or leasing of the Approved Aged Care Assets.
"CHARGED PROPERTY" means:
(a) the Leased Property; and
(b) all rights of the Chargor under the Moran Relationship
Agreement, any management contract entered into by the
Chargor as part of or in connection with the Business, the
Moran Lease, the Moran Guarantee and the Moran
<PAGE> 607
Securities; and
(c) the Remaining Property,
but does not include the Excluded Property.
"DEBENTURE STOCK TRUST DEED" means the deed so entitled dated 17
June 1998 between the Chargor and the Security Trustee.
"EVENT OF CRYSTALLISATION" means each or any of the following
events:
(a) any breach of clause 4.1;
(b) any Encumbrance over any asset of the Chargor becomes
enforceable or any Encumbrance that is a floating security
over any asset of the Chargor crystallises or otherwise
becomes a fixed or specific security;
(c) any Insolvency Event occurs in relation to the Chargor;
(d) the Commissioner of Taxation, or its delegate, determines to
issue a notice under section 74 of the Sales Tax Assessment
Act 1992 or section 218 of the Income Tax Assessment Act
1936 for any amount due by the Chargor in respect of any Tax
under such Act or any fines and costs imposed on the Chargor
under such Act; and
(e) any other event that the Security Trustee has notified the
Chargor to be an Event of Crystallisation for the purposes
of this Charge.
"EXCLUDED PROPERTY" means any asset, property or undertaking which
is located outside of Western Australia.
"FAI PROPERTY" means the charged property referred to in the
Original Debenture Stock Trust Deed.
"INITIAL UNITHOLDERS" means Metlife Australia (Holdings) Pty
Limited, ACN 070 667 417 and FAI Deposit Co. Pty Limited, ACN 008
647 489.
"INTELLECTUAL PROPERTY" means all patents, trademarks, copyrights,
registered designs, trade secrets, confidential information and
other intellectual property at any time held by or registered in
the name of the Chargor or which the Chargor at any time has the
benefit of, has an interest in or is entitled to use.
"LICENCE" means each licence, certificate, document, registration,
permission, privilege, permit, authority or consent which is issued
or held in connection with the Business, which is necessary or
desirable to be held by the Chargor in relation to the Business
including any variation or renewal thereof.
<PAGE> 608
"LEASED PROPERTY" means:
(a) the Properties;
(b) each nursing home/residential care facility and any other
aged care or health care related facility currently or
subsequently operated on any Property;
(c) all plant and equipment fixed to any property referred to in
another paragraph of this definition; and
(d) all assets and chattels on the Properties (or any facility
referred to in paragraph (b)) and used in connection with
the Business on the date of commencement of the Moran Lease.
"MORAN GUARANTEE" means all of the present and future right, title
and interest of the Chargor in:
(a) the Lease Guarantee dated on or about the date of this
Charge between Moran Health Care Group Pty Limited and the
Chargor; and
(b) all Associated Rights in relation to and all proceeds
deriving from the Property referred to in paragraph (a).
"MORAN LEASE" means all of the present and future right, title and
interest of the Chargor in:
(a) the lease entered into by the Chargor with Moran Health Care
(Australia) Pty Limited in respect of the Properties on or
about the date of this Charge (as amended, varied, novated,
supplemented, ratified or replaced from time to time); and
(b) all Associated Rights in relation to and all proceeds
deriving from the property referred to in paragraph (a).
"MORAN RELATIONSHIP AGREEMENT" means the agreement entitled
"Relationship Agreement" between the Chargor, Moran Health Care
(Australia) Pty Limited and Moran Health Care Group Pty Limited
dated on or about the date of this Charge.
"MORAN SECURITIES" means all of the present and future right, title
and interest of the Chargor in:
(a) the Fixed and Floating Charge dated 19 June 1998
between the Chargor and Moran Health Care (Australia)
Pty Limited as trustee of the Moran Health Care
Australia Trust;
(b) the Mortgage of Units dated 19 June 1998 between the
Chargor and Moran Health Care Group Pty Limited; and
<PAGE> 609
(c) the Mortgage of Shares dated 19 June 1998 between the
Chargor and Moran Health Care Group Pty Limited.
"ORIGINAL DEBENTURE STOCK TRUST DEED" means the Debenture Stock
Trust Deed dated 17 June 1998 between the Chargor and the Security
Trustee.
"PHF TRUST" means the trust known as the "Principal Healthcare
Finance Trust" (formerly known as the "Assisted Living Unit Trust")
constituted by the Trust Deed.
"POWER" means any right, power, authority, discretion, remedy or
privilege conferred on the Security Trustee, Receiver or any
attorney or agent appointed under this Charge, by any Transaction
Document, by Statute, or by law or equity in respect of this Charge
or any Collateral Security.
"PREMIER CARE AUSTRALIA SECURITY TRUST" means the trust constituted
by the Debenture Stock Trust Deed.
"PROPERTIES" means the properties listed in the Schedule.
"RECEIVER" means a receiver or receiver and manager appointed by
the Security Trustee under this Charge and if more than one, then
each of them, and also any servant, agent or delegate of any of
them.
"RELATED BODY CORPORATE" has the meaning given in section 9 of the
Corporations Law and refers to any corporation of that kind
whenever it becomes related.
"REMAINING PROPERTY" means all of the Chargor's assets,
undertakings and rights, both present and future, but excluding:
(a) the FAI Property; and
(b) the property referred to in paragraphs (a) and (b) of the
definition of "Charged Property".
"TRUST DEED" means the deed of trust dated 11 August 1995 between
the Chargor and the Initial Unitholders.
1.2 INTERPRETATION
In this Charge:
(a) headings are for convenience only and do not affect
interpretation;
and unless the context indicates a contrary intention:
(b) the expression "PERSON" includes an individual, the
estate of an
<PAGE> 610
individual, a corporation, and a statutory or other
authority or association (incorporated or
unincorporated);
(c) a reference to any party includes that party's
executors, administrators, successors, substitutes
and assigns, including any person taking by way of
novation and in the case of a trustee includes any
substituted or additional trustee;
(d) a reference to the Charged Property includes any part
of it;
(e) a reference to this Charge, to a Transaction Document
or to any other document includes respectively this
Charge, the Transaction Document or that other
document as amended, varied, novated, supplemented,
ratified or replaced from time to time;
(f) a reference to any legislation or to any section or
provision thereof includes any statutory
modification,
(g) re-write or re-enactment or any statutory provision
substituted therefor, and all ordinances, by-laws,
regulations and other statutory documents issued
thereunder;
(h) words importing the singular include the plural (and
vice versa) and words denoting a given gender include
all other genders;
(i) a reference to a clause is a reference to a clause of
this Charge;
(j) where any word or phrase is given a defined meaning,
any other part of speech or grammatical form in
respect of that word or phrase has a corresponding
meaning;
(k) all accounting terms used in this Charge have the
meaning given under accounting principals and
practices generally accepted in Australia from time
to time; and
(l) mentioning anything after "include", "includes" or
"including" does not limit what else may be included.
1.3 DEBENTURE STOCK TRUST DEED
(a) The Chargor and the Security Trustee acknowledge and
agree that this Charge are each a "Transaction
Document" as defined in and for the purposes of the
Debenture Stock Trust Deed.
(b) The Chargor and the Security Trustee agree that this
Charge is a "Collateral Security" as defined in and
for the purposes of the Debenture Stock Trust Deed.
<PAGE> 611
(c) To the extent to which any provision of this Charge
is inconsistent with the Debenture Stock Trust Deed,
the Debenture Stock Trust Deed shall prevail.
1.4 SECURITY TRUSTEE
(a) Any reference to the "Security Trustee" in this
Charge will be construed as referring to the Security
Trustee as trustee for the Stockholders.
(b) As between the Chargor on the one hand and the
Security Trustee and the Stockholders on the other,
all action taken by the Security Trustee under this
Charge will be taken to be authorised and the Chargor
need make no enquiry as to the authority of the
Security Trustee.
2. CHARGE
2.1 THE CHARGE
The Chargor both in its personal capacity and as trustee of the PHF
Trust hereby charges all the Charged Property to the Security
Trustee to secure the due and punctual performance, observance and
fulfilment of all the Obligations and the payment in full of the
Secured Money.
2.2 ASSETS OVER WHICH THIS CHARGE IS FIXED
This Charge will operate as a fixed charge over the Charged
Property listed below (whether present or future) which does not
form part of the Remaining Property:
(a) all real and leasehold property, and all fixtures and
improvements thereon;
(b) all machinery, vehicles, fittings, furniture, plant
and equipment, computer software and hardware;
(c) the Moran Guarantee, all rights of the Chargor under
any management contract in respect of the Business,
the Moran Lease and all other documents, contracts,
(including leases), rights and records relating to
the Business;
(d) the goodwill of the Business and all Licences;
(e) the Moran Securities and all other Encumbrances,
Marketable Securities, documents of title and
Intellectual Property,
with the intention that each item of future property described in
this clause 2.2 will be specifically charged to the Security
Trustee at the time it is acquired by the Chargor. This
<PAGE> 612
Charge will operate as a floating charge as regards all other
Charged Property (including the Remaining Property).
2.3 DEALING WITH PROPERTY SUBJECT TO FLOATING CHARGE
Subject to any contrary provision in any Transaction Document, the
Chargor may in respect of any part of the Charged Property which is
subject to the floating charge created by this Charge, deal with
and pay or apply that part of the Charged Property in the ordinary
course of its ordinary business.
2.4 AUTOMATIC CRYSTALLISATION OF FLOATING CHARGE
(a) If any Event of Crystallisation occurs, the floating charge
created by this Charge will (except to the extent to which
this Charge is a floating charge over the Remaining
Property) at that time automatically crystallise and
immediately become a fixed charge over that part of the
Charged Property not immediately prior to such occurrence
the subject of the fixed charge.
(b) if an Administrator Event occurs the floating charge created
by this Charge will (to the extent to which this Charge is a
floating charge over the Remaining Property) at that time
automatically crystallise and immediately become a fixed
charge over the Remaining Property.
2.5 NOTICE OF CONVERSION
The Security Trustee may at any time by notice in writing to the
Chargor convert or reconvert its security under this Charge from
(except in the case of the Remaining Property) a floating charge to
a fixed charge or from a fixed charge to a floating charge. Any
such conversion will be effective from the moment of receipt of
notice of such conversion.
2.6 RECONVERSION
The Security Trustee may at any time by notice in writing to the
Chargor reconvert its security under this Charge from a fixed
charge to a floating charge in respect of any asset or class of
asset specified in that notice.
2.7 CONVERSION TO LEGAL MORTGAGE
If an Event of Default occurs and is not waived or remedied in the
period (if any) permitted in any Transaction Document, at any time
thereafter if such event continues the Security Trustee may procure
itself (or its nominee) to be registered as the holder of any
shares forming part of the Charged Property (other than any shares
forming part of the Remaining Property). Without limiting the
generality of the foregoing, the Chargor irrevocably and
unconditionally authorises the Security Trustee to date and
complete any transfers and lodge such transfers for stamping and
registration accompanied by the share certificates relating
thereto, if applicable. The Security Trustee's costs and expenses
<PAGE> 613
relating to the transfer and registration, including stamp duty and
other taxes, will be payable by the Chargor on demand and will form
part of the Secured Money.
2.8 PROSPECTIVE LIABILITY
For the purpose only of section 282(3) of the Corporations Law, the
specified maximum amount of the prospective liability secured by
this Charge is $200,000,000. The nature of the prospective
liability is as shown on the notice lodged with this Charge with
the Australian Securities and Investments Commission. Nothing in
this clause 2.8 will limit, or put the Security Trustee under any
obligation to do any act or thing so as to increase, the amount of
the money secured by this Charge.
2.9 LIMITATION
This Charge is security for the due and punctual performance,
observance and fulfilment of all the Obligations and the payment in
full of all of the Secured Money. Nevertheless the amount payable
by the Chargor and ultimately recoverable by the Security Trustee
upon enforcement of this Charge is limited to the greater of:
(a) $15,610,000; and
(b) the aggregate value of the Charged Property
determined as at the date of such enforcement.
3. REPRESENTATIONS AND WARRANTIES
3.1 GENERAL REPRESENTATIONS AND WARRANTIES
The Chargor represents and warrants to the Security Trustee that:
(a) (GOOD TITLE): it has good right to charge the Charged
Property as beneficial owner in the manner provided
in this Charge and in each Collateral Security, and
the Charged Property is free of all Encumbrances;
(b) (LEGALLY BINDING OBLIGATION): this Charge constitutes
a valid and legally binding obligation of the Chargor
in accordance with its terms;
(c) (EXECUTION, DELIVERY AND PERFORMANCE): the execution,
delivery and performance of this Charge by the
Chargor does not violate any Statute or law, or any
document or agreement to which the Chargor is a party
or which is binding on it or any of its assets;
(d) (AUTHORISATION): all consents, licences, approvals
and authorisations of every Government Authority
required to be obtained by the Chargor in connection
with the execution, delivery and performance of this
Charge have been obtained and are valid and
subsisting;
<PAGE> 614
(e) (FINANCIAL LIABILITIES): the Chargor is not in
default in the payment of any material sum or in the
performance or observance of any material obligation
in respect of any Financial Liability, and no event
has occurred which with the giving of notice, lapse
of time or other condition could constitute a default
in respect of any Financial Liability;
(f) (NO EVENT OF DEFAULT): no event has occurred which
constitutes an Event of Default or a Potential Event
of Default;
(g) (STATUTES): the Chargor has not failed to comply with
any Statute relative to it or the Business where such
failure may have a material adverse effect on the
Chargor's ability to observe its obligations under
the Transaction Documents; and
(h) (NO TRUSTS): the Chargor is not the trustee of any
trust (other than the PHF Trust) nor does it hold any
property subject to or impressed by any trust (other
than the PHF Trust).
3.2 CORPORATE REPRESENTATIONS AND WARRANTIES
The Chargor further represents and warrants to the Security Trustee
that:
(a) (DUE INCORPORATION): it is duly incorporated and has
the corporate power to own its property and to carry
on its business as is now being conducted;
(b) (CONSTITUTION): the execution, delivery and
performance of this Charge does not violate the
Constitution of the Chargor;
(c) (CORPORATE POWER): it has the power, and has taken
all corporate and other action required, to enter
into this Charge and to authorise the execution and
delivery of this Charge and the performance of its
obligations under this Charge; and
(d) (FILINGS): the Chargor has filed all corporate
notices and effected all registrations with the
Australian Securities and Investments Commission and
all of those filings and registrations are current,
complete and accurate.
3.3 TRUST REPRESENTATIONS AND WARRANTIES
The Chargor further represents and warrants to the Security Trustee
that:
(a) (TRUSTEE): it enters, or has entered, into this
Charge in its capacity as trustee of the PHF Trust;
<PAGE> 615
(b) (TRUST VALIDLY CREATED): the PHF Trust has been
validly created and is in existence at the date of
this Charge;
(c) (TRUSTEE VALIDLY APPOINTED): the Chargor has been
validly appointed as trustee of the PHF Trust and is
presently the sole trustee of the PHF Trust;
(d) (TRUST DEED): the PHF Trust is solely constituted by
the Trust Deed, (a true copy of which has been
provided to the Security Trustee or its agent before
the date of this Charge) and the Trust Deed discloses
all the terms of the PHF Trust other than terms
implied by law;
(e) (TRUSTEE'S POWER): it has full and free power to
enter into this deed in its capacity as trustee of
the PHF Trust;
(f) (TRUST AUTHORISATIONS): it has in full force and
effect all authorisations necessary to enter into
this deed as trustee of the PHF Trust, and to perform
its obligations under them;
(g) (NO REMOVAL OF TRUSTEE): no action has been taken or
is proposed to remove it as trustee of the PHF Trust;
(h) (NO DEFAULT OF TRUSTEE): it is not in default under
the Trust Deed which would have the effect of
limiting or removing its right of indemnity from the
property of the PHF Trust, or would affect its power
or ability to enter into this deed (or to perform its
obligations under this deed) as trustee of the PHF
Trust;
(i) (TRUST OBLIGATIONS): it has complied with its
obligations in connection with the PHF Trust;
(j) (VESTING DATE NOT DECLARED): a date has not been
declared pursuant to the Trust Deed as the date on
which the PHF Trust will be vested or come to an end,
and no other action has been taken or is proposed to
terminate the PHF Trust;
(k) (NO PROCEEDINGS): no proceedings of any description
have been or are likely to be commenced or threatened
which could have a material adverse effect on the
assets or financial position of the PHF Trust or on
its trusteeship thereof;
(l) (NO ACQUISITION OF TRUST ASSETS): it has not done, or
failed to do, any act whereby any of the assets of
the PHF Trust have been acquired by any other person
and no assets of the PHF Trust are presently
registered in the name of any other person and no
person, other than the Chargor and the beneficiaries
of the PHF Trust from time to time,
<PAGE> 616
has acquired any right of any kind whether vested or
contingent in any asset of the PHF Trust;
(m) (INDEMNITY): it has a right to be fully indemnified
out of the property of the PHF Trust in respect of
obligations incurred by it under this Charge; and
(n) (COMMERCIAL BENEFIT): it is to the commercial benefit
of the PHF Trust that it enters into this Charge in
its capacity, inter alia, as trustee of the PHF
Trust.
3.4 REPRESENTATIONS AND WARRANTIES REPEATED
Each representation and warranty in this Charge will be repeated on
each day whilst any of the Secured Money remains outstanding
(whether or not then due for payment) with reference to the facts
and circumstances then subsisting, as if made on each such day.
4. COVENANTS CONCERNING THE CHARGED PROPERTY
4.1 RESTRICTIONS IN RELATION TO THE CHARGED PROPERTY
The Chargor will not without the Security Trustee's prior written
consent (which will not be unreasonably withheld):
(a) (NO ENCUMBRANCES): create, purport or attempt to
create or permit to exist any Encumbrance howsoever
ranking over any part of the Charged Property (other
than the Remaining Property).
(b) (NO SALE, LEASE ETC.): convey, assign, transfer,
lease or otherwise dispose or part with possession
of, make any bailment over, grant any option over or
create or permit to exist any other interest in any
part of the Charged Property whilst that part of the
Charged Property is subject to the fixed charge
created in this Charge or in any Collateral Security;
(c) (NOT TO PREJUDICE): do or permit any act, omission or
thing whereby any part of the Charged Property (other
than the Remaining Property) becomes or could be
liable to surrender, forfeiture or cancellation or
becomes prejudiced in any manner or the value of this
Charge as a security to the Security Trustee becomes
or could be materially lessened;
(d) (ORDINARY COURSE): subject to this Charge, deal with
or attempt to deal with the Charged Property other
than in the ordinary course of its ordinary business;
(e) (AMENDMENTS, ETC): amend, vary, terminate, cancel or
surrender any
<PAGE> 617
Moran Guarantee, any Moran Lease or any Moran
Security in any material respect; or
(f) (STEP): take any step towards doing any of these
things.
4.2 INSPECTION
The Chargor will following the occurrence of any Event of Default
(or if the Security Trustee suspects, on reasonable grounds, that
an Event of Default may have occurred) permit the Security Trustee
and any employee, agent or professional adviser of the Security
Trustee, to enter any land or buildings owned or occupied by the
Chargor or any Related Body Corporate of the Chargor (except to the
extent to which they form part of the Remaining Property), at all
reasonable times, without notice, to inspect its condition and to
monitor compliance with this Charge (so long as to do so will not
cause the Chargor to be in breach of any Statute or any lease of
such land or buildings).
4.3 PROTECTION OF CHARGED PROPERTY
At the request of the Security Trustee, the Chargor will take or
defend all legal proceedings that the Security Trustee considers
necessary or desirable for the preservation, protection or recovery
of all or any part of the Charged Property.
4.4 CONDUCT OF BUSINESS
The Chargor will carry on and conduct the Business in a proper and
efficient manner and will not change the general character of or
discontinue the Business without the Security Trustee's prior
written consent.
4.5 INTELLECTUAL PROPERTY
The Chargor will maintain and renew all its present and future
Intellectual Property.
4.6 LICENCES
The Chargor will:
(a) (APPLY): apply for (or procure the application for)
and use (or procure that the applicant uses) its best
endeavours to obtain and maintain each licence which
is not held in respect of the Business but which is
required by law to be held;
(b) (RENEW): on or before the time and in the manner
prescribed by the relevant Statute for each Licence,
apply for (or procure the application for) and
procure the renewal of each Licence, and pay or cause
to be paid the renewal fees and other sums required
in respect of the Licence or the renewal of the
Licence within the time allowed and in the manner
prescribed by the Statute;
<PAGE> 618
(c) (PRODUCTION OF THE LICENCE): whenever reasonably
requested by the Security Trustee, produce to the
Security Trustee (or procure the production to the
Security Trustee of) each Licence and all receipts
for payments in relation to each Licence;
(d) (NO CANCELLATION): not do, allow or suffer any act,
matter or thing as a result of which any Licence is
or may be surrendered, forfeited, withdrawn,
cancelled, refused or rendered void, or whereby the
holder of any Licence is disqualified permanently or
temporarily from receiving or continuing to hold a
Licence, or whereby the Business may be disqualified
permanently or temporarily from having a Licence; and
(e) (COMPLY WITH STATUTES): procure that the holder of
any Licence complies with all Statutes and all lawful
requirements of every Government Authority in
relation to the Licence (to the extent that such
compliance is necessary to ensure that the Licence is
not revoked, terminated or forfeited) or otherwise
does all things required of the holder.
4.7 SECURITY TRUSTEE ASSUMES NO OBLIGATIONS
The Security Trustee will not be deemed by virtue of this Charge to
have assumed any obligation of the Chargor under any Licence or
Statute.
4.8 DOCUMENTS OF TITLE AND OTHER SECURITIES
The Chargor will lodge with the Security Trustee all documents
relating to each Encumbrance under which the Chargor is the
Encumbrancee, all certificates, scrip and other indicia of the
Chargor's title or interest in any Marketable Securities, all
negotiable instruments other than cheques, all real estate leases,
and all other documents of title to the whole or part of the
Charged Property (other than the Remaining Property) immediately on
receipt of same.
4.9 POSTPONEMENT OR WAIVER OF ENCUMBRANCES
The Chargor will, if requested by the Security Trustee, immediately
cause:
(a) any Encumbrance which has arisen or which arises from
time to time by operation of law over the Charged
Property (other than the Remaining Property) in
favour of any person (including the Chargor) to be at
the Security Trustee's option postponed in all
respects after and subject to this Charge or to be
otherwise discharged, released or terminated; and
(b) any Financial Liability or other obligation secured
by any such
<PAGE> 619
Encumbrance at the Security Trustee's option to be
waived, released, paid or performed.
5. EVENTS OF DEFAULT
(a) If any Event of Default occurs and while it subsists at the
option of the Security Trustee and notwithstanding any delay
or previous waiver of the right to exercise that option, all
Powers not previously exercisable become exercisable, and
also at the like option of the Security Trustee, the right
of the Chargor to deal with the Charged Property (other than
the Remaining Property) immediately ceases.
(b) If an Administrator Event occurs then, notwithstanding any
delay or previous waiver of the right to exercise that
option, all Powers in respect of the Remaining Property not
previously exercisable become exercisable and also at the
like option of the Security Trustee, the right of the
Chargor to deal with the Remaining Property immediately
ceases.
Nothing in this paragraph (b) limits paragraph (a) of this
clause 5 or any other provision of this Charge or any other
Transaction Document.
6. RECEIVERS: APPOINTMENT AND POWERS
6.1 APPOINTMENT OF RECEIVER
At any time after the happening of any Event of Default or after
the whole or part of the Secured Money becomes due and payable
under the provisions of this Charge, the Security Trustee may if
directed by an Extraordinary Resolution of Stockholders:
(a) appoint in writing any person or persons to be a
receiver or receiver and manager of the whole or part
of the Charged Property;
(b) withdraw the appointment of that Receiver as to the
whole or part of the Charged Property; and
(c) (in case of the removal, retirement or death of any
Receiver) appoint another person or persons in his
place,
PROVIDED THAT the Security Trustee may only exercise its rights and
powers under this clause 6.1 in respect of the Remaining Property
if an Administrator Event has occurred.
6.2 JOINT RECEIVERS
If more than one person is appointed as a Receiver of the whole or
any part of the Charged Property, the Security Trustee may specify
whether the appointment, and the Powers of each appointee, will at
its option be joint, or joint and several, and failing such
specification, the appointment and the Powers of each person will
be deemed to be joint and several.
<PAGE> 620
6.3 REMUNERATION OF RECEIVER
The Security Trustee may fix the rate of remuneration of any
Receiver at such rate as the Security Trustee from time to time
determines, which rate will not exceed the standard hourly rate
from time to time charged by the firm of which the Receiver is a
member for work of the level conducted by the Receiver.
6.4 AGENT OF THE CHARGOR
Every Receiver will be the agent of the Chargor who will be solely
responsible for all acts and omissions by and the remuneration of
the Receiver.
6.5 POWERS OF RECEIVER
Without the need for any consent by the Chargor, each Receiver will
have all of the powers specified in section 420 of the Corporations
Law, and in addition to those and any other Powers, will have all
of the following powers:
(a) (TAKE POSSESSION): to take possession or control of
or make use of the whole or any part of the Charged
Property or relinquish possession or control;
(b) (CONVERT TO MONEY): to convert, liquidate and reduce
the whole or any part of the Charged Property into
money;
(c) (LEASE): whether or not the Receiver has taken
possession, to lease or licence in the name of the
Chargor or otherwise the whole or any part of the
Charged Property, for any period and on any terms or
to vary or terminate a lease or licence;
(d) (CARRY ON BUSINESS): to carry on or concur in
carrying on each Business and do all acts which the
Chargor might do in the ordinary conduct of such
Business for the protection or improvement of the
whole or part of the Charged Property;
(e) (BORROW OR RAISE MONEY): to borrow or raise from the
Security Trustee or any other person any money which
may be required for any purpose, and in the name of
the Chargor or otherwise to secure any money so
borrowed or raised by the grant of any Encumbrance
over the whole or part of the Charged Property
(whether in the name of the Chargor or otherwise) so
that the Encumbrance ranks in priority to, pari passu
with or after this Charge. The Security Trustee will
not be bound to inquire as to the necessity or
propriety of any Financial Liability nor be
responsible for the misapplication or non-
application of any money so borrowed or raised;
(f) (ENGAGE): to engage consultants, contractors,
professional advisers,
<PAGE> 621
agents and employees (including any person associated
with a firm or company in which the Receiver is a
member or in which he is interested, and that person
may charge for his services as if he had been
independently retained at such salaries or
remuneration as the Receiver thinks fit), and the
Receiver may act on any advice given by that person;
(g) (CONDUCT WORKS): to repair, renew, replace, renovate
or clean the Charged Property, to erect any new
buildings or make any improvements to any land
forming part of the Charged Property, and to
demolish, alter, rebuild or extend any existing
buildings on the Charged Property;
(h) (SELL PROPERTY): whether or not in possession, to
sell or concur in selling all or any of the Charged
Property by public auction, private treaty or tender,
for cash or on credit, in one lot or in parcels, with
or without special conditions as to title or the time
and the mode of payment of purchase money and on such
other terms as the Receiver thinks fit, with power to
defer payment of any part of the purchase money,
whether or not secured by an Encumbrance from the
purchaser, and to buy in and to rescind or vary any
contract for sale, and to resell without being
responsible for loss;
(i) (CONTRACTS FOR SALE): to exercise all or any rights,
powers and remedies of the Chargor under any contract
for sale and to execute those contracts, transfers,
applications for transfer, assignments and assurances
of all or any part of the Charged Property in the
name and on behalf of the Chargor or otherwise, and
to do all other acts and things for implementing and
completing any sale that the Receiver deems
necessary;
(j) (SEVER AND SELL FIXTURES): to sever fixtures
belonging to the Chargor and to sell them separately
from any other part of the Charged Property;
(k) (INVEST PROCEEDS AGAINST CONTINGENCIES): if any part
of the Secured Money is contingent, to invest,
deposit or hold the Charged Property in a form or
mode of investment for the time being as the Receiver
in its absolute discretion thinks fit, with like
power to vary, transpose or re-invest the investments
or deposits from time to time until such part of the
Secured Money ceases to be contingent;
(l) (ENTER INTO CONTRACTS): to enter into any contract or
arrangement with any person for any purpose connected
with this Charge or the whole or any part of the
Charged Property or in furtherance of any Power, on
such terms and conditions as the Receiver in its
absolute discretion thinks fit, including without
limitation, granting or conferring options
<PAGE> 622
to, in favour of or exercisable by any person for the
purpose of or in connection with the sale, purchase,
leasing, hiring, or other dealing with, the whole or
any part of the Charged Property;
(m) (PERFORM CONTRACTS): to perform, observe, carry out,
enforce specific performance of, exercise or refrain
from exercising, the Chargor's rights and powers
under, obtain the benefit of, and to vary or rescind,
all contracts and rights forming part of the Charged
Property or entered into in the exercise of any
Power;
(n) (TAKE PROCEEDINGS): to institute, conduct or defend
any proceedings in law, equity or bankruptcy, and to
submit to arbitration, mediation or conciliation, in
the name of the Chargor or otherwise and on any
terms, any proceeding, claim, question or dispute in
connection with the Charged Property or otherwise;
(o) (COMPROMISE): to make any settlement, arrangement or
compromise regarding any action or dispute arising in
connection with the Charged Property; to grant to any
person involved therein time or other indulgence; and
to execute all such releases or discharges in
connection therewith as the Receiver thinks expedient
in the interests of the Security Trustee;
(p) (APPEAL): to appeal against or to enforce any
judgment or order;
(q) (BANKRUPT DEBTORS AND WIND-UP COMPANIES): to make
debtors bankrupt and to wind-up companies and to do
all things in connection with any bankruptcy or
winding up which the Receiver thinks necessary for
the recovery or protection of the whole or part of
the Charged Property, or for the security or other
benefit of the Security Trustee;
(r) (DELEGATE): with the consent in writing of the
Security Trustee, to delegate to any person for such
time or times as the Security Trustee approves, any
of the Powers, including this power of delegation;
(s) (FILE): to file all certificates, registrations and
other documents and to take any and all action on
behalf of the Chargor which the Security Trustee or
Receiver believes is necessary to protect, preserve
or improve any or all of the Charged Property and the
rights of the Chargor and the Security Trustee in
respect of any agreement for sale, and to obtain for
the Security Trustee and the Stockholders all of the
benefits of this Charge and any Transaction Document;
and in particular, the placing of the Chargor into
liquidation or the appointment of a Receiver will be
deemed to be an event against which the Security
Trustee may protect its rights;
<PAGE> 623
(t) (MAKE CALLS): to call and get in the uncalled and
called but unpaid nominal or premium capital of the
Chargor;
(u) (OPERATE BANK ACCOUNTS): to open or operate any bank
account in the Chargor's name (whether alone or
jointly) to the exclusion of the Chargor, and to
deposit or withdraw any money to the credit of that
account, and to sign and indorse or to authorise
others to sign and indorse in the name of the Chargor
cheques, promissory notes bills of exchange and other
negotiable instruments;
(v) (DO ALL OTHER THINGS NECESSARY): to do all things
necessary to perform, observe and fulfil any of the
covenants on the part of the Chargor contained in
this Charge; and
(w) (RECEIVER'S DISCRETION): to do all other acts and
things without limitation as the Receiver thinks
expedient in the interests of the Security Trustee or
the Stockholders,
and any further powers and discretions as the Security Trustee
confers on the Receiver by notice in writing to the Receiver for
the purposes referred to in this clause 6.5,
PROVIDED THAT a Receiver may only exercise the powers referred to
in this clause 6.5 in respect of the Remaining Property if an
Administrator Event has occurred.
6.6 INDEMNITY
The Security Trustee may give any indemnities to the Receiver
concerning the performance of the Receiver's duties as are
permitted by law. If the Security Trustee is obliged to pay any
money under any indemnity, that money will become part of the
Secured Money.
7. SECURITY TRUSTEE'S POWERS
7.1 EXERCISE OF POWER
At any time after the happening of any Event of Default or after
the whole or part of the Secured Money becomes due and payable
under the provisions of this Charge the Security Trustee may if
directed by an Extraordinary Resolution of Stockholders without
notice and whether or not a Receiver has been appointed:
(a) exercise all or any of the Powers conferred on a
Receiver or which would be conferred on a Receiver if
appointed as if those Powers had been expressly
conferred on the Security Trustee;
(b) exercise all other Powers; and
(c) appoint an agent or joint and several agents and
delegate such Powers to it or them (in which case
clauses 6.1, 6.3 and 6.6 will apply as if
<PAGE> 624
it or they were appointed as a Receiver),
PROVIDED THAT the Security Trustee may only exercise its rights and
powers under this clause 7.1 in respect of the Remaining Property
if an Administrator Event has occurred.
7.2 ACT JOINTLY
The Security Trustee or Receiver may exercise any of the Powers in
conjunction with the exercise of similar powers by any other
Encumbrancee of the whole or part of the Charged Property or by any
receiver appointed by that other Encumbrancee, and may enter into
and give effect to agreements and arrangements with that other
Encumbrancee or receiver as the Security Trustee or Receiver thinks
fit.
7.3 POWER OF ATTORNEY
(a) The Chargor irrevocably appoints the Security
Trustee, each director, manager and attorney from
time to time of the Security Trustee, and any
Receiver severally, as its attorney, with power at
any time after the occurrence of an Event of Default
(and to the extent to which the Event of Default has
not been remedied or waived) to:
(i) do all acts which ought to be done by the
Chargor under this Charge or to exercise any
Power;
(ii) demand, sue for, recover and receive all or
any part(s) of the Charged Property from any
person, in the name of and on behalf of the
Chargor, or in the name of the Security
Trustee or an attorney appointed under this
Charge;
(iii) take further action and to execute further
instruments which are, or are in the opinion
of the Security Trustee, either necessary to
more satisfactorily secure the payment of the
Secured Money or are expedient in relation to
the Charged Property; and
(iv) appoint (and remove at will) at any time any
person(s) as a substitute(s) for an attorney
or attorneys,
PROVIDED THAT an attorney may only exercise rights and
powers under this clause 7.3 in respect of the Remaining
Property if an Administrator Event has occurred (and to the
extent to which the Administrator Event has not been
remedied or waived).
(b) The Chargor ratifies and confirms now and for the
future all actions lawfully undertaken by or on
behalf of its attorney under this Power of Attorney.
(c) The Chargor declares that this Power of Attorney will
continue in force until all actions taken under it
have been completed, notwithstanding the discharge of
this Charge or any of the agreements
<PAGE> 625
or arrangements to which it refers.
7.4 SECURITY TRUSTEE MAY MAKE GOOD ANY DEFAULT
If the Chargor defaults in duly performing, observing and
fulfilling any of the Obligations, the Security Trustee may,
without prejudice to any other Power, do all things and pay all
money necessary or expedient in the opinion of the Security Trustee
to make good or to attempt to make good that default to the
satisfaction of the Security Trustee.
7.5 NOTICE FOR EXERCISE OF POWERS
(a) The Powers may be exercised by the Security Trustee
and the Receiver immediately or at any time after an
Event of Default occurs without any notice or lapse
of time being necessary unless required by a law
which cannot be excluded.
(b) One day is fixed as the period for which:
(i) default must continue in the performance,
observance and fulfilment of the whole or any
part of the Obligations, or in the payment of
any part of the Secured Money, including
interest, before the Security Trustee may
serve any notice in writing as required by any
Statute affecting the Powers; and
(ii) default must continue after the service of
notice before any power of sale given by
Statute may be exercised.
8. APPLICATION OF MONEY
8.1 PRIORITY OF PAYMENTS
All money received by the Security Trustee or by the Receiver as a
result of the exercise of the Powers in respect of the Chargor will
be applied in the following order:
(a) (INCIDENTAL TO EXERCISE OF POWERS): in payment of all
costs, charges, expenses and disbursements incurred
in or incidental to the exercise or attempted
exercise of any of the Powers;
(b) (OUTGOINGS): in payment of any other outgoings as the
Receiver or the Security Trustee thinks fit;
(c) (PAYMENT OF SECURED MONEY SECURED BY STOCK): in
payment to the Stockholders of the balance of the
Secured Money (other than the Face Amount) secured by
the Stock (rateably according to the respective
amounts of their respective Secured Money as at the
date the payment is made);
<PAGE> 626
(d) (PAYMENT OF FACE AMOUNT): in payment to the
Stockholders in respect of the Face Amount secured by
the Stock (rateably according to the respective
amounts of their respective Secured Money as at the
date the payment is made);
(e) (SUBSEQUENT ENCUMBRANCES): in payment of subsequent
Encumbrances of which the Security Trustee is aware
in the order of their priority; and
(f) (SURPLUS): the surplus (if any) belongs to the
Chargor but does not carry interest.
8.2 CONTINGENT INDEBTEDNESS
If the Security Trustee receives money in connection with this
Charge when part of the Secured Money is contingently or
prospectively owing, then the Security Trustee must deposit an
amount not exceeding that part in an interest-bearing deposit
account with a bank on such terms as the Security Trustee thinks
fit until that part becomes actually payable or no longer falls
within the definition of "Secured Money". At that time the Security
Trustee may retain for its own account the amount which is then
actually payable to it. The balance is to be paid in accordance
with clause 8.1.
8.3 MONEY RECEIVED
In applying any money towards satisfaction of the Secured Money,
the Chargor will be credited only with as much of the money
available for that purpose as will be actually received by the
Security Trustee or the Receiver and is not required for whatever
reason to be disgorged, a credit to date from the time of receipt.
8.4 APPLICATION OF PAYMENTS OR CREDITS
Subject to this clause 8, each of the Security Trustee and the
Receiver has an absolute discretion to apply any payment or credit
received by it under this Charge in reduction of any part or parts
of the Secured Money, whenever and on whatever account the same
became secured, notwithstanding any principle or presumption of law
to the contrary or any direction given at the time of receipt, and
without the need to communicate its election to any person.
8.5 RELIANCE ON CERTIFICATE
In making any payment to any other Encumbrancee under clause 8.1,
the Security Trustee and the Receiver may rely on a certificate
from that Encumbrancee as to the amount secured, and are not bound
to enquire as to the accuracy of the certificate or whether the
amount referred to is validly secured by the Encumbrance.
<PAGE> 627
9. LIABILITY AND RELEASE
9.1 CONTINUING OBLIGATION
This Charge constitutes a continuing obligation regardless of any
settlement of account, intervening payment, express or implied
revocation, or any other matter or thing. Without limiting the
generality of the foregoing, each indemnity in this Charge is a
separate additional and continuing obligation and will survive the
discharge of this Charge. Unless otherwise agreed, payment by the
Security Trustee will not be a pre-condition to liability under any
indemnity.
9.2 PERSONAL LIABILITY
Notwithstanding any payout figure quoted or other form of account
stated by the Security Trustee, and notwithstanding the rule in
Groongal Pastoral Company Limited (In Liquidation) v. Falkiner
(1924) 35 CLR 157, no grant of full or partial satisfaction of or
discharge from this Charge by the Security Trustee will release the
Chargor from personal liability under this Charge or under any
Transaction Document until all the Secured Money has in fact been
received by the Security Trustee and is not liable to be disgorged,
notwithstanding that the quotation or statement of account has
arisen from the mistake, negligence, error of law or error of fact
of the Security Trustee, its servants or agents.
9.3 SETTLEMENT CONDITIONAL
Any settlement or discharge between the Chargor and the Security
Trustee is conditional on any security or payment given or made to
the Security Trustee by the Chargor or any other person in relation
to the Obligations not being avoided, repaid or reduced by virtue
of any Insolvency Provision. If the security or payment is avoided,
repaid or reduced, the Security Trustee is entitled to recover the
value or amount of such security or payment avoided, repaid or
reduced from the Chargor subsequently as if that settlement or
discharge had not occurred.
9.4 CHARGOR'S LIABILITY NOT AFFECTED
The liability of the Chargor under this Charge:
(a) (ABSOLUTE): is absolute and is not subject to the
execution of any Transaction Document or any other
document by any person or to the performance of any
condition precedent or subsequent;
(b) (NOT AFFECTED): will not be affected by any act,
omission, matter or thing that would otherwise
operate in law or in equity to reduce or release the
Chargor from its liability including, without
limiting the generality of the foregoing, any of the
following:
(i) the occurrence of any Event of Default;
(ii) the receipt by the Security Trustee of any
payment,
<PAGE> 628
dividend or distribution under any Insolvency
Provision in relation to the Chargor;
(iii) any Transaction Document or any payment the
making of which would otherwise have formed
part of the Secured Money being or becoming or
being conceded to be illegal, invalid, void,
voidable, unenforceable or irrecoverable in
whole or in part for any reason whether past,
present or future, including, without limiting
the generality of the foregoing:
A. any Statute, other law or principle of
equity;
B. any act or omission by any person;
C. any legal limitation, disability or
incapacity of the Chargor;
D. any improper exercise of a Power;
E. any Power being suspended or postponed
by Statute, any court order or
otherwise; or
F. any Insolvency Provision;
(iv) the Security Trustee accepting any Transaction
Document;
(v) the Security Trustee granting time, waiver or
other indulgence or concession to, or to
making any composition or compromise with, the
Chargor;
(vi) the Security Trustee forbearing or neglecting
to exercise any remedy or right it has for the
enforcement of any Transaction Document or any
of the Obligations;
(vii) any laches, acquiescence or other act,
neglect, default, omission or mistake by the
Security Trustee;
(viii) the determination, rescission, repudiation or
termination, or the acceptance of any of the
foregoing, by the Security Trustee or the
Chargor of any Transaction Document or any of
the Obligations;
(ix) execution of any Transaction Document or any
variation to any Transaction Document or any
of the Obligations, whether or not such event
imposes an additional liability upon or is
onerous on the Chargor;
(x) the full, partial or conditional release or
discharge by the Security Trustee or by
operation of law, of any person from any
Transaction Document or any of the
Obligations;
(xi) the release of any property from any
Transaction Document or the substitution of
any property in place of any other property
now or hereafter the subject of a Transaction
Document;
(xii) the Security Trustee wasting, destroying,
abandoning, prejudicing or not perfecting,
maintaining, preserving, enforcing or
realising or not properly enforcing or
realising a Transaction Document;
(xiii) the failure to obtain any Transaction Document
or the loss or impairment of any Transaction
Document by operation
<PAGE> 629
of law or otherwise, whether or not the same
is in breach of an express or implied
condition to obtain or preserve such
Transaction Document or in breach of any
equitable duty which might otherwise have been
imposed upon the Security Trustee;
(xiv) the postponement or loss of the priority
attaching to any Transaction Document;
(xv) the opening or operation of any new account
with the Security Trustee by the Chargor;
(xvi) any change in membership (whether by death or
retirement of an existing member, admission of
a new member or otherwise) or name of any
partnership, firm or association in which the
Chargor is a member;
(xvii) the transfer or assignment of the benefit of
any Transaction Document or of any of the
Obligations;
(xviii) any failure by the Security Trustee to
disclose to the Chargor any material or
unusual fact, circumstance, event or thing
whatsoever known to, or which ought to have
been known by, the Security Trustee relating
to or affecting the Chargor at any time prior
to or during the currency of any Transaction
Document, whether prejudicial or not to the
rights and liabilities of the Chargor and
whether or not the Security Trustee was under
any duty of disclosure; or
(xix) the Security Trustee entering into a covenant
with the Chargor not to sue, issue process,
sign or execute judgment, commence proceedings
for bankruptcy or liquidation, participate in
any scheme of arrangement or reconstruction,
prove in any bankruptcy or liquidation or do
any other act, matter or thing in respect of
the liability of the Chargor.
9.5 RELEASE OF CHARGED PROPERTY
The Security Trustee will be under no obligation to grant a release
of the Charged Property from this Charge unless at the time the
release is to be provided, none of the Secured Money is owing
(whether actually, contingently, or prospectively), none of the
Obligations remain to be performed and it is not reasonably
foreseeable that there could be any money owing or Obligations to
be performed at a future time.
10. PROTECTION AND INDEMNITY
10.1 WAIVER BY THE CHARGOR
The Chargor waives in favour of the Security Trustee:
(a) all rights against the Security Trustee and any other
person, estate or assets as far as is necessary to
give effect to any provision of this
<PAGE> 630
Charge;
(b) promptness and diligence on the part of the Security
Trustee, and any other requirement that the Security
Trustee take any action or exhaust any right against
any other person before enforcing this Charge; and
(c) all rights inconsistent with the provisions of this
Charge, including any rights of contribution or
subrogation which the Chargor might otherwise be
entitled to claim or enforce.
10.2 NO LIABILITY FOR LOSS
Neither the Security Trustee nor any Receiver will be liable or
otherwise accountable for any omission, delay or mistake, or any
loss or irregularity in or about the exercise, attempted exercise,
non-exercise or purported exercise of any Power, except for actual
fraud or wilful misconduct.
10.3 NO LIABILITY TO ACCOUNT
Neither the Security Trustee nor any Receiver will, by reason of
the Security Trustee or the Receiver entering into possession of
the whole or part of the Charged Property, be liable to account as
mortgagee or Security Trustee in possession, or for any loss on
realisation or for any default, omission, delay or mistake for
which a mortgagee or Security Trustee in possession might be
liable.
10.4 NO CONFLICT
The Security Trustee and any Receiver may exercise any Power
notwithstanding that the exercise of that Power involves a conflict
between any duty owed to the Chargor by the Security Trustee or
that Receiver and any duty owed by the Security Trustee or Receiver
to any other person, or the interests of the Security Trustee or
Receiver. No contract will be void or voidable by virtue of any
such conflict of duty or interest, nor will the Security Trustee or
Receiver be liable to account to the Chargor or any other person
for any money or property as a result of such conflict.
10.5 NO NOTICE OR ENFORCEMENT
The Security Trustee need not give any notice of this Charge to any
debtor of the Chargor, or to any purchaser, or to any other person,
or to enforce payment of any money payable to the Chargor, or
realise any of the Charged Property, or to take any steps or
proceedings for that purpose.
10.6 INDEMNITY
The Chargor will on demand indemnify and keep the Security Trustee
indemnified in respect of all costs, expenses, liabilities and
losses incurred by the Security Trustee or the Receiver:
<PAGE> 631
(a) in the exercise, attempted exercise or non-exercise
of any Power, including (without limitation) those
consequent on any mistake, oversight, error of
judgment or want of prudence on the part of the
Security Trustee or the Receiver, unless the same is
due to actual fraud or wilful misconduct;
(b) as a consequence of the occurrence of any Event of
Default;
(c) by reason of this Charge;
(d) in respect of any act or omission for which the
Security Trustee or the Receiver is exonerated by
this Charge; and
(e) by reason of the Security Trustee redeeming or taking
a transfer of any Encumbrance ranking in priority to
or pari passu with this Charge,
and the Chargor will defend all actions, proceedings, claims or
demands brought by any person in relation to any matter the subject
of this indemnity.
10.7 PROTECTION OF PERSONS DEALING WITH THE SECURITY TRUSTEE OR
RECEIVER
No person acquiring any money or asset from or paying or handing
over any money or asset to or otherwise dealing with the Security
Trustee, the Receiver or any attorney appointed under this Charge,
or to whom is tendered for registration an instrument executed by
the Security Trustee, the Receiver or any attorney appointed under
this Charge, will be:
(a) bound to inquire:
(i) whether any Event of Default has occurred;
(ii) whether any of the Secured Money is owing or
payable;
(iii) whether the Receiver or attorney has been
properly appointed;
(iv) as to the propriety or regularity of the
exercise or purported exercise of any Power;
or
(v) as to any other matter or thing;
(b) affected by actual or constructive notice that any
transaction, document or other dealing is unnecessary
or improper; or
(c) concerned to see to the application of any money or
asset, or be answerable or accountable for any loss
or misapplication,
and the irregular, improper or unnecessary exercise of any Power
will be, as regards the protection of any such person, deemed to be
authorised by the Chargor, and valid.
<PAGE> 632
11. PAYMENTS
11.1 CREDIT BALANCES OF OTHER ACCOUNTS
In determining the Secured Money, no credit need be allowed by the
Security Trustee or any Stockholder for any credit balance in any
joint or other account of the Chargor with either of them, or for
any other money owing by the Security Trustee or any Stockholder to
the Chargor.
11.2 PAYMENT OF INTEREST
The Chargor will pay interest on the Secured Money to the Security
Trustee or any Stockholder in accordance with each Transaction
Document, and in the absence of any relevant provision, to the
Security Trustee at the Specified Rate calculated on daily balances
computed from the time or respective times when the money becomes
owing to, or is paid by, the Security Trustee or Stockholder.
Interest accrues daily, and is payable on the earlier of a demand
from the Security Trustee (made at the request of a Stockholder) or
the last Banking Day of each calendar month, whilst the Secured
Money remains outstanding.
11.3 CAPITALISATION OF INTEREST
The Security Trustee or any Stockholder may capitalise any interest
which has become due and owing in accordance with any Transaction
Document or in the absence of any relevant provision then at such
periods of not less than one calendar month and from such dates as
the Security Trustee or that Stockholder elects. The accumulation
of capitalised interest may continue until the Secured Money has
been paid in full, notwithstanding any composition, compromise,
judgment or order in respect of any person or any other matter.
11.4 MERGER
If the liability of the Chargor to pay any of the Secured Money to
the Security Trustee or any Stockholder becomes merged in any
judgment or order, the Chargor will, as an independent obligation,
pay interest at the rate which is the higher of that payable under
this Charge and that fixed by or payable under that judgment or
order.
11.5 NO DEDUCTION FOR TAXES AND NO SET-OFF OR COUNTERCLAIM
Subject to any Transaction Document, all payments of Secured Money
by the Chargor to the Security Trustee or a Stockholder will be:
(a) free of any set-off or counterclaim; and
(b) subject to any Statute, without deduction or
withholding for any present or future Taxes.
<PAGE> 633
11.6 CURRENCY CONVERSION AND INDEMNITY
(a) If any amount is required to be paid in a particular
currency and the Security Trustee receives payment in
another currency, the Security Trustee may actually
or notionally convert the amount received into the
required currency at the spot rate which it is or
considers it would be able to obtain in the market at
the time following receipt when it sees fit to make
the conversion. The Chargor will only satisfy its
obligation to pay in the required currency to the
extent of the amount actually or notionally received
after deducting the costs of conversion.
(b) The Chargor agrees to indemnify the Security Trustee
for any deficiency which arises for any reason
between the amount actually received under any
judgment, court or tribunal order or distribution
under any Insolvency Provision which takes into
account any currency conversion rate and the amount
which would be actually or notionally received by the
Security Trustee by applying the conversion provided
for in this clause.
12. EXPENSES, STAMP DUTIES AND REGISTRATION
12.1 EXPENSES
The Chargor on demand will reimburse the Security Trustee for and
keep the Security Trustee indemnified against all expenses,
including legal fees, costs and disbursements (on a solicitor/own
client basis) incurred by the Security Trustee in connection with:
(a) (PREPARATION): the preparation, negotiation and
execution of the Transaction Documents and any
subsequent consent, agreement, waiver, amendment to,
or discharge of any of them; and
(b) (ENFORCEMENT): the exercise, enforcement,
preservation, or attempted exercise, enforcement or
preservation of any rights under the Transaction
Documents, including without limitation any expenses
incurred in the evaluation of any matter of material
concern to the Security Trustee or any Stockholder.
The Chargor will bear the cost of its compliance with the
Transaction Documents.
12.2 STAMP DUTIES
(a) (PAYMENT OF ALL DUTIES): The Chargor will pay all
stamp duty, loan transaction, registration and
similar Taxes, including fines and penalties,
financial institutions duty and debits tax which may
be payable to or required to be paid by any
appropriate authority, or determined to be payable in
connection with the execution, delivery, performance
or enforcement of this Charge, or any payment,
receipt
<PAGE> 634
or other transaction contemplated by this Charge.
(b) (INDEMNITY): The Chargor will indemnify the Security
Trustee against any loss or liability incurred or
suffered by it as a result of the delay or failure by
the Chargor to pay Taxes.
12.3 REGISTRATION
The Chargor will ensure that this Charge is registered in the
manner and within such time limits as may be prescribed by law to
ensure the full efficacy of this Charge as a security to the
Security Trustee in all relevant jurisdictions.
13. GOVERNING LAW AND JURISDICTION
13.1 GOVERNING LAW
This Charge is to be governed by and construed in accordance with
the laws of New South Wales.
13.2 JURISDICTION.
(a) (ACCEPTANCE OF JURISDICTION): The Chargor irrevocably
submits to and accepts generally and unconditionally
the non-exclusive jurisdiction of the courts and
appellate courts of New South Wales with respect to
any legal action or proceedings which may be brought
at any time relating in any way to this Charge.
(b) (NO OBJECTION TO INCONVENIENT FORUM): The Chargor
irrevocably waives any objection it may now or in the
future have to the venue of any such action or
proceedings, and any claim it may now or in the
future have that action or proceeding has been
brought in an inconvenient forum.
14. MISCELLANEOUS
14.1 CONFIDENTIALITY
(a) Subject to clause 14.1(b) the Security Trustee and
the Stockholders will not disclose any confidential
or unpublished information or documents supplied by
the Chargor in connection with the Transaction
Documents which are specifically indicated by the
Chargor to be confidential.
(b) The Security Trustee and the Stockholders will be
entitled to disclose any confidential information or
documents:
(i) to a Stockholder;
<PAGE> 635
(ii) in any proceeding arising out of or in
connection with any Transaction Document to
the extent that such disclosure is deemed by
that person necessary to protect its
interests;
(iii) if required to do so under a binding order of
any Government Authority or any procedure for
discovery in any proceedings;
(iv) if required to do so under any law or any
administrative guideline, directive, request
or policy whether or not having the force of
law and, if not having the force of law, the
observance of which is in accordance with the
practice of responsible trustees, bankers or
financial institutions;
(v) otherwise as required or permitted by any
Transaction Document;
(vi) to its legal advisers and its consultants as
long as it advises them of the confidential
nature of the information or documents or that
nature is clear from the circumstances of the
disclosure;
(vii) to a proposed Stockholder or assignee or
transferee from a Stockholder with the prior
written consent of the Chargor which consent
will not unreasonably be withheld or delayed
and will be deemed to have been given if not
refused within 5 Banking Days of a request
therefore; or
(viii) with the Chargor's prior written consent.
(c) This clause 14.1 survives the termination of this
Charge.
14.2 FURTHER ASSURANCE
The Chargor will, and will procure that, all persons having or
claiming any estate or interest in the whole or part of the Charged
Property from time to time and at all times after the date of this
Charge on the request of the Security Trustee and at the cost of
the Chargor, will make, do and execute or cause to be made, done
and executed all acts, deeds and assurances for:
(a) more satisfactorily securing to the Security Trustee
the payment of the Secured Money;
(b) assuring or more satisfactorily assuring the Charged
Property to the Security Trustee, or as the Security
Trustee may direct; or
(c) facilitating the exercise of any Power.
In particular, whenever requested to do so by the Security Trustee,
the Chargor will execute in favour of the Security Trustee legal
mortgages, transfers, assignments or other assurances of the
Charged Property in terms acceptable to the Security Trustee.
<PAGE> 636
14.3 CERTIFICATE OF SECURITY TRUSTEE
A certificate in writing signed by an officer of the Security
Trustee certifying the amount payable by the Chargor to the
Security Trustee or stating any other act, matter or thing relating
to this Charge or any Transaction Document is conclusive and
binding on the Chargor in the absence of manifest error on the face
of the certificate.
14.4 NOTICES
Any notice or other communication served, given or made under or in
connection with this Charge or any Collateral Security to which the
Chargor is a party:
(a) must be in writing in order to be valid;
(b) is sufficient if executed by the party serving,
giving or making the same or on its behalf by any
attorney, director, secretary, other duly authorised
officer or solicitor of such party;
(c) will be deemed to have been duly served, given or
made in relation to a party if it is delivered or
posted by prepaid post to the address, or sent by
facsimile to the number of that party set out in the
Transaction Documents or notified in writing by that
party to the other parties from time to time; and
(d) will be deemed to be served, given or made:
(i) (in the case of prepaid post) on the fifth day
after the date of posting;
(ii) (in the case of facsimile) on receipt of a
transmission report confirming successful
transmission; and
(iii) (in the case of delivery by hand) on delivery.
14.5 ASSIGNMENT
(a) (CHARGE BINDS ASSIGNS): This Charge will be binding
on and inure to the benefit of the Chargor, the
Stockholders and the Security Trustee and their
respective successors and assigns.
(b) (ASSIGNMENT BY THE CHARGOR): Notwithstanding clause
14.5(a), the Chargor may not assign or transfer all
or any part of its rights or obligations under this
Charge without the prior written consent of the
Security Trustee acting on the instructions of all
the Stockholders.
14.6 NO MERGER
Neither this Charge, any Collateral Security nor any of the Powers
will merge or prejudicially affect or be merged in or prejudicially
affected by and the Chargor's
<PAGE> 637
obligations under this Charge will not in any way be abrogated or
released by any other security, any judgment or order, any
contract, any cause of action or remedy, or any other matter or
thing now or hereafter existing in respect of the Secured Money.
14.7 SEVERABILITY OF PROVISIONS
Any provision of a Transaction Document which is illegal, void or
unenforceable will be ineffective to the extent only of that
illegality, voidness or unenforceability without invalidating the
remaining provisions.
14.8 POWERS CUMULATIVE
Each Power is cumulative and in addition to each other Power
available to the Security Trustee or the Receiver.
14.9 WAIVER
A failure to exercise or enforce or a delay in exercising or
enforcing or the partial exercise or enforcement of any Power by
the Security Trustee will not in any way preclude, or operate as a
waiver of, any further exercise or enforcement of that or any other
Power.
14.10 CONSENTS
Any waiver or consent given by the Security Trustee under this
Charge may be given or withheld and may be given subject to any
conditions, as the Security Trustee thinks fit in its absolute
discretion unless this Charge expressly provides otherwise.
14.11 WRITTEN WAIVER AND CONSENT
Any waiver or consent given by the Security Trustee under this
Charge or any Collateral Security will only be effective and
binding on the Security Trustee if it is given or confirmed in
writing.
14.12 TIME OF ESSENCE
Time is of the essence in respect of the Chargor's obligations
under this Charge or any Collateral Security.
14.13 MORATORIUM LEGISLATION
To the fullest extent permitted by law, the provisions of all
Statutes at any time operating directly or indirectly to lessen or
affect in favour of the Chargor any obligation under this Charge or
any Collateral Security, or to delay or otherwise prevent or
prejudicially affect the exercise of any Power, are expressly
waived, negatived and excluded.
<PAGE> 638
14.14 BINDING ON EACH SIGNATORY
This Charge is binding on each of the signatories notwithstanding
that any one or more of the named parties does not execute this
Charge, or that there is any invalidity, forgery or irregularity
touching any execution of this Charge, or that this Charge is or
becomes unenforceable, void or voidable against a named party.
14.15 COUNTERPARTS
This Charge may be executed in a number of counterparts, all of
which taken together will be deemed to constitute one and the same
document.
14.16 NO REPRESENTATION BY OR RELIANCE ON SECURITY TRUSTEE
The Chargor does not enter into this Charge in reliance on or as a
result of any representation, promise, statement, conduct or
inducement by or on behalf of the Security Trustee or any
Stockholder otherwise than as set out in the Transaction Documents.
<PAGE> 639
SCHEDULE
<TABLE>
<CAPTION>
NAME ADDRESS FOLIO IDENTIFIER
- ---- ------- ----------------
NSW
- ---
<S> <C> <C>
Annandale Nursing Home 76 Johnston Street, Auto Consol
Annandale NSW 2038 9867-46
Armon Nursing Home 42 Croydon Street, 1/110079
Petersham NSW 2049
Bathurst Nursing Home 61 Boyd Street, 11/806355
Kelso NSW 2795
Bossley Park Nursing Home 52-64 Quarry Street, Bossley 8/713734
Park NSW 2176
Canterbury District Nursing 20 Albert Street, 1/549851
Home Campsie NSW 2194
Crest Nursing Home 11 Johnston Street, 1/913045 and 1/913044
Annandale NSW 2038
Dubbo Nursing Home 80 Muller Street, 12/592842
Dubbo NSW 2830
Fernleigh Nursing Home 8 Sherbrooke Road, 4/201757 and 1/201757
West Ryde NSW 2114
Maitland Nursing Home Broughton Street, Rutherford 5/733509
NSW 2320
Mudgee Nursing Home 207-213 Denison Street, 1/261314
Mudgee NSW 2850
Murwillumbah Nursing Cnr North Arm Road and 1/786640
Home Ingram Place,
Murwillumbah NSW 2484
Narrandera Nursing Home Chantilly Street, 2/582847
Narrandera NSW 2700 308/257212
Norah Head Nursing Home 63 Palomar Parade, 721/26247 and
Toukley NSW 2263 509/26247
Quakers Hill Nursing Home 35 Hambledon Road, 10/860042
Quakers Hill NSW 2763
Shoalhaven Nursing Home Brinawarr Street, 5/614886
Bomaderry NSW 2541
</TABLE>
<PAGE> 640
<TABLE>
<CAPTION>
NAME ADDRESS FOLIO IDENTIFIER
- ---- ------- ----------------
<S> <C> <C>
Stanmore Nursing Home 66 Cambridge Street, 31/7/1
Stanmore NSW 2048
</TABLE>
<PAGE> 641
<TABLE>
<CAPTION>
NAME ADDRESS FOLIO IDENTIFIER
- ---- ------- ----------------
<S> <C> <C>
QUEENSLAND
Caloundra Nursing Home Lyon Street, Lot 2, RP 177466
Caloundra QLD 4551
Nambour Nursing Home 9 Princess Crescent, Lot 2, RP 183823
Nambour QLD 4560
WESTERN AUSTRALIA
Apple Cross Nursing Home 30 Carron Road, Vol. 1964 Fol 640
Apple Cross WA 6153
Armadale Nursing 21 Angelo Street, Vol 1951 Fol 293
Centre/Hillview Nursing Armadale WA 6112
Home
Bunbury Nursing Home 39 Hayes Street, Vol 1534 Fol 995
Bunbury WA 6230
Geraldton Nursing Home 20 Milford Street, Vol. 1539 Fol 329
Geraldton WA 6530 Vol. 1890 Fol 506
Kalgoorlie Nursing Home Dugan Street, Vol. 1597 Fol 789
Kalgoorlie WA 6430
Narrogin Nursing Home 52 Williams Road Vol. 1634 Fol 809
Narrogin WA 6312
Murray River Nursing Home Cnr Coolibah & Boundary Vol. 1697 Fol 190
Roads,
Dudley Park,
Mandurah WA 6210
</TABLE>
<PAGE> 642
EXECUTED as a deed.
SIGNED SEALED AND DELIVERED )
for and on behalf of PRINCIPAL ) .............................
HEALTHCARE FINANCE PTY ) (Signature)
LIMITED, ACN 069 875 476 )
by its Attorney under a )
Power of Attorney dated and )
who declares that he has not received any )
notice of the revocation of such Power of )
Attorney in the presence of: )
........................................
(Signature of Witness)
........................................
(Name of Witness in Full) )
................................
(Signature)
SIGNED SEALED AND DELIVERED )
for and on behalf of ABN AMRO ) .............................
FACILITIES AUSTRALIA LIMITED, ) (Signature)
ACN 001 035 543 )
by its Attorney under a )
Power of Attorney dated and )
who declares that he has not received any )
notice of the revocation of such Power of )
Attorney in the presence of: )
.........................................
(Signature of Witness)
.........................................
(Name of Witness in Full) )
<PAGE> 643
TABLE OF CONTENTS
<TABLE>
<CAPTION>
CLAUSE PAGE
<S> <C> <C>
1. DEFINITIONS AND INTERPRETATION 1
1.1 DEFINITIONS 1
1.2 INTERPRETATION 4
1.3 DEBENTURE STOCK TRUST DEED 5
1.4 SECURITY TRUSTEE 5
2. CHARGE 5
2.1 THE CHARGE 5
2.2 ASSETS OVER WHICH THIS CHARGE IS FIXED 6
2.3 DEALING WITH PROPERTY SUBJECT TO FLOATING CHARGE 6
2.4 AUTOMATIC CRYSTALLISATION OF FLOATING CHARGE 6
2.5 NOTICE OF CONVERSION 6
2.6 RECONVERSION 7
2.7 CONVERSION TO LEGAL MORTGAGE 7
2.8 PROSPECTIVE LIABILITY 7
2.9 LIMITATION 7
3. REPRESENTATIONS AND WARRANTIES 7
3.1 GENERAL REPRESENTATIONS AND WARRANTIES 7
3.2 CORPORATE REPRESENTATIONS AND WARRANTIES 8
3.3 TRUST REPRESENTATIONS AND WARRANTIES 9
3.4 REPRESENTATIONS AND WARRANTIES REPEATED 10
4. COVENANTS CONCERNING THE CHARGED PROPERTY 10
4.1 RESTRICTIONS IN RELATION TO THE CHARGED PROPERTY 10
4.2 INSPECTION 11
4.3 PROTECTION OF CHARGED PROPERTY 11
4.4 CONDUCT OF BUSINESS 11
4.5 INTELLECTUAL PROPERTY 11
4.6 LICENCES 11
4.7 SECURITY TRUSTEE ASSUMES NO OBLIGATIONS 12
4.8 DOCUMENTS OF TITLE AND OTHER SECURITIES 12
4.9 POSTPONEMENT OR WAIVER OF ENCUMBRANCES 12
5. EVENTS OF DEFAULT 12
6. RECEIVERS: APPOINTMENT AND POWERS 13
6.1 APPOINTMENT OF RECEIVER 13
</TABLE>
<PAGE> 644
TABLE OF CONTENTS
<TABLE>
<CAPTION>
CLAUSE PAGE
<S> <C> <C>
6.2 JOINT RECEIVERS 13
6.3 REMUNERATION OF RECEIVER 13
6.4 AGENT OF THE CHARGOR 13
6.5 POWERS OF RECEIVER 13
6.6 INDEMNITY 16
7. SECURITY TRUSTEE'S POWERS 16
7.1 EXERCISE OF POWER 16
7.2 ACT JOINTLY 17
7.3 POWER OF ATTORNEY 17
7.4 SECURITY TRUSTEE MAY MAKE GOOD ANY DEFAULT 18
7.5 NOTICE FOR EXERCISE OF POWERS 18
8. APPLICATION OF MONEY 18
8.1 PRIORITY OF PAYMENTS 18
8.2 CONTINGENT INDEBTEDNESS 19
8.3 MONEY RECEIVED 19
8.4 APPLICATION OF PAYMENTS OR CREDITS 19
8.5 RELIANCE ON CERTIFICATE 19
9. LIABILITY AND RELEASE 19
9.1 CONTINUING OBLIGATION 19
9.2 PERSONAL LIABILITY 20
9.3 SETTLEMENT CONDITIONAL 20
9.4 CHARGOR'S LIABILITY NOT AFFECTED 20
9.5 RELEASE OF CHARGED PROPERTY 22
10. PROTECTION AND INDEMNITY 22
10.1 WAIVER BY THE CHARGOR 22
10.2 NO LIABILITY FOR LOSS 22
10.3 NO LIABILITY TO ACCOUNT 22
10.4 NO CONFLICT 22
10.5 NO NOTICE OR ENFORCEMENT 23
10.6 INDEMNITY 23
10.7 PROTECTION OF PERSONS DEALING WITH THE SECURITY TRUSTEE OR RECEIVER 23
11. PAYMENTS 24
11.1 CREDIT BALANCES OF OTHER ACCOUNTS 24
</TABLE>
<PAGE> 645
TABLE OF CONTENTS
<TABLE>
<CAPTION>
CLAUSE PAGE
<S> <C> <C>
11.2 PAYMENT OF INTEREST 24
11.3 CAPITALISATION OF INTEREST 24
11.4 MERGER 24
11.5 NO DEDUCTION FOR TAXES AND NO SET-OFF OR COUNTERCLAIM 24
11.6 CURRENCY CONVERSION AND INDEMNITY 25
12. EXPENSES, STAMP DUTIES AND REGISTRATION 25
12.1 EXPENSES 25
12.2 STAMP DUTIES 25
12.3 REGISTRATION 26
13. GOVERNING LAW AND JURISDICTION 26
13.1 GOVERNING LAW 26
13.2 JURISDICTION 26
14. MISCELLANEOUS 26
14.1 CONFIDENTIALITY 26
14.2 FURTHER ASSURANCE 27
14.3 CERTIFICATE OF SECURITY TRUSTEE 27
14.4 NOTICES 27
14.5 ASSIGNMENT 28
14.6 NO MERGER 28
14.7 SEVERABILITY OF PROVISIONS 28
14.8 POWERS CUMULATIVE 28
14.9 WAIVER 28
14.10 CONSENTS 29
14.11 WRITTEN WAIVER AND CONSENT 29
14.12 TIME OF ESSENCE 29
14.13 MORATORIUM LEGISLATION 29
14.14 BINDING ON EACH SIGNATORY 29
14.15 COUNTERPARTS 29
14.16 NO REPRESENTATION BY OR RELIANCE ON SECURITY TRUSTEE 29
</TABLE>
<PAGE> 646
DEED OF CHARGE (WA)
DATE:
PRINCIPAL HEALTHCARE FINANCE PTY LIMITED
Chargor
ABN AMRO FACILITIES AUSTRALIA LIMITED
Security Trustee
(C) Copyright Clayton Utz
Liability is limited by the Solicitors Scheme under the
Professional Standards Act 1994 NSW
<PAGE> 647
TRIPARTITE AGREEMENT made at Sydney on 1998
BETWEEN PHF NO. 1 PTY LIMITED, ACN 082 747 313 AND TANOA PTY
LIMITED, ACN 001 396 989 (each a "UNITHOLDER")
AND PRINCIPAL HEALTHCARE FINANCE PTY LIMITED, ACN 069 875 476
both in its personal capacity and in its capacity as trustee of the
PHF Trust ("TRUSTEE")
AND ABN AMRO AUSTRALIA LIMITED, ACN 000 862 797 and ABN AMRO
BANK N.V., AUSTRALIAN BRANCH, ARBN 079 478 612 (each a
"FINANCIER")
AND ABN AMRO FACILITIES AUSTRALIA LIMITED, ACN 001 035 543
("SECURITY TRUSTEE")
1. DEFINITIONS AND INTERPRETATION
1.1 DEFINITIONS
In this Agreement:
"EVENT OF DEFAULT" means any of the events set out or referred to in
clause 7 of this Deed.
"NEW FINANCIER" has the same meaning as in the Warehouse Facility
Agreement.
"ORIGINAL SECURITIES" has the same meaning as in the Warehouse Facility
Agreement.
"PHF TRUST" means the trust known as the "Principal Healthcare Finance
Trust" (formerly known as the "Assisted Living Unit Trust") constituted
by the Trust Deed.
"SUBSTITUTION CERTIFICATE" has the same meaning as in the Warehouse
Facility Agreement.
"TAXES" has the same meaning as in the Warehouse Facility Agreement.
"TRANSACTION DOCUMENTS" has the same meaning as in the Warehouse Facility
Agreement.
"TRUST DEED" means the deed of trust dated 11 August 1995 between the
Trustee, Metlife Australia (Holdings) Pty Limited and FAI Deposit Co. Pty
Limited.
"TRUST FUND" means the property held on trust by the Trustee under the
Trust Deed.
"WAREHOUSE FACILITY AGREEMENT" means the agreement so entitled between
the Trustee, the Financiers and the Security Trustee dated on or about
the date of this Deed.
1.
<PAGE> 648
1.2 INTERPRETATION
In this Agreement:
(a) headings are for convenience only and do not affect interpretation;
and unless the context indicates a contrary intention:
(b) the expression "PERSON" includes an individual, the estate of an
individual, a body politic, a corporation and a statutory or other
authority or association (incorporated or unincorporated);
(c) reference to any party includes that party's executors,
administrators, successors, substitutes and assigns, including any
person taking by way of novation;
(d) reference to this Agreement or to any other deed, agreement, document
or instrument includes, respectively, this Agreement or such other
deed, agreement, document or instrument as amended, novated,
supplemented, varied or replaced from time to time;
(e) reference to any legislation or to any section or provision thereof
includes any statutory modification, rewrite or re-enactment or any
statutory provision substituted therefor and all ordinances, by-laws,
regulations and other statutory instruments issued thereunder;
(f) words importing the singular include the plural (and vice versa) and
words denoting a given gender include all other genders;
(g) a reference to a clause is a reference to a clause of this Agreement;
(h) where any word or phrase is given a defined meaning, any other part
of speech or other grammatical form in respect of such word or phrase
has a corresponding meaning;
(i) a reference to the Unitholders is a reference to them jointly and to
each of them severally;
(j) mentioning anything after "include", "includes" or "including" does
not limit what else may be included; and
(k) the Trustee and the Security Trustee agree that this Agreement is a
"Transaction Document" as defined in and for the purposes of:
(i) the Debenture Stock Trust Deed dated 17 June 1998 between the
Trustee and the Security Trustee; and
2.
<PAGE> 649
(ii) the Debenture Stock Trust Deed dated on or about the date
of this Agreement between the Trustee and the Security
Trustee.
2. WARRANTIES
The Trustee represents and warrants to each Financier that:
(a) (TRUSTEE): the Trustee enters into the Transaction Documents to
which it is a party in its capacity as trustee of the PHF Trust;
(b) (TRUST VALIDLY CREATED): the PHF Trust has been validly created
and is in existence at the date of this Agreement;
(c) (SOLE TRUSTEE): the Trustee has been validly appointed as trustee
of the PHF Trust and is presently the sole trustee of the PHF
Trust;
(d) (TRUST DEED): the PHF Trust is solely constituted by the Trust
Deed (a true copy of which was provided to the Financiers and the
Security Trustee prior to the date of this Agreement) and the
Trust Deed discloses all the terms of the PHF Trust other than
terms implied by law;
(e) (TRUSTEE'S POWER): the Trustee has full and free power to enter
into the Transaction Documents inter alia in its capacity as
trustee of the PHF Trust;
(f) (TRUST AUTHORISATIONS): the Trustee has in full force and effect
all authorisations necessary to enter into the Transaction
Documents as trustee of the PHF Trust, and to perform its
obligations under them;
(g) (NO REMOVAL OF TRUSTEE): no action has been taken or is proposed
to remove the Trustee as trustee of the PHF Trust;
(h) (NO DEFAULT OF TRUSTEE): the Trustee is not in default under the
Trust Deed;
(i) (TRUST OBLIGATIONS): the Trustee and its directors and other
officers have complied with their obligations in connection with
the PHF Trust;
(j) (VESTING DATE NOT DECLARED): a date has not been declared
pursuant to the Trust Deed as the date on which the PHF Trust
will be vested or come to an end, and no other action has been
taken or is proposed to terminate the PHF Trust;
(k) (NO PROCEEDINGS): no proceedings of any description have been or
are likely to be commenced or threatened in writing which could
have a material adverse effect on the assets or financial
position of the PHF Trust or on the Trustee's trusteeship
thereof;
(l) (NO ACQUISITION OF TRUST ASSETS): the Trustee has not done, or
failed to do, any act whereby any of the assets of the PHF Trust
have been acquired by any other
3.
<PAGE> 650
person and no assets of the PHF Trust are presently registered in
the name of any other person and no person, other than the
Trustee and the beneficiaries of the PHF Trust from time to time,
has acquired any right of any kind whether vested or contingent
in any asset of the PHF Trust;
(m) (INDEMNITY): the Trustee has a right to be fully indemnified out
of the property of the PHF Trust in respect of obligations
incurred by it under the Transaction Documents;
(n) (COMMERCIAL BENEFIT): it is to the commercial benefit of the PHF
Trust that the Trustee enters into the Transaction Documents in
its capacity, inter alia, as trustee of the PHF Trust and
encumbers the property of the PHF Trust as provided under the
Original Securities; and
(o) (RANKING): the Financier's rights under the Transaction Documents
rank in priority to the interests of the beneficiaries of the PHF
Trust.
3. ACKNOWLEDGEMENT REGARDING THE TRANSACTION DOCUMENTS
The Trustee acknowledges that the Transaction Documents are binding on it
personally and in its capacity as trustee of the PHF Trust.
4. COVENANTS
4.1 EXECUTION OF DOCUMENTS
At the Financier's request the Trustee will, at its own expense:
(a) do everything necessary or appropriate to bind the Trustee and
its successors under the Transaction Documents; and
(b) use all reasonable endeavours to cause relevant third parties to
do likewise.
4.2 TRUSTEE
The Trustee will not default in its duties as trustee of the PHF Trust.
4.3 OPERATION AND MAINTENANCE OF TRUST
The Trustee and the Unitholders will not, without the consent of the
Financier, do anything which:
(a) facilitates the retirement, removal or replacement of the Trustee
as trustee of the PHF Trust;
(b) restricts the Trustee's right of indemnity from the Trust Fund in
respect of obligations incurred by the Trustee under the
Transaction Documents;
4.
<PAGE> 651
(c) restricts or impairs the ability of the Trustee to observe its
obligations under the Transaction Documents;
(d) facilitates the termination of the PHF Trust;
(e) facilitates the resettlement of the Trust Fund; or
(f) could result in the Trust Fund being mixed with other property.
5. UNITHOLDERS
5.1 CONSENT
The Unitholders consent to the Trustee executing and observing its
obligations under the Transaction Documents.
5.2 WAIVER
The Unitholders waive any right they have to claim that the Trustee's
execution of or observance of obligations under the Transaction Documents
are in breach of the Trustee's obligations and duties as trustee of the
PHF Trust.
6. INDEMNITY
The Trustee indemnifies each Financier against liability, loss, costs,
charges or expenses arising because an Event of Default occurs, including
without limitation legal costs and expenses on a full indemnity basis.
7. EVENTS OF DEFAULT
An event of default occurs if:
(a) a representation or warranty made by or on behalf of the Trustee
in connection with this Agreement is found to be incorrect or
misleading in a material respect;
(b) the Trustee ceases to be the only trustee of the PHF Trust,
without first having obtained the Financier's written consent;
(c) an application or order is sought or made in any court for:
(i) removal of the Trustee as trustee of the PHF Trust;
(ii) accounts to be taken in respect of the PHF Trust; or
(iii) property of the PHF Trust to be brought into court or
administered by the court or under its control;
(d) a notice is given or meeting summoned for the removal of the
Trustee as trustee
5.
<PAGE> 652
of the PHF Trust or for the appointment of another person as
trustee of the PHF Trust jointly with the Trustee without the
written consent of the Financiers; or
(e) the Trustee or the Unitholders do not observe any other
obligation under this Agreement and, if the non-observance can be
remedied, does not remedy the non-observance within 15 days after
receipt of a written demand from the Financier to do so.
8. EXPENSES AND STAMP DUTIES
8.1 EXPENSES
The Trustee will on demand reimburse each Financier for and keep each
Financier indemnified against all expenses including legal fees, costs
and disbursements on a solicitor/own client basis assessed without the
necessity of taxation incurred by the Financier in connection with:
(a) (PREPARATION): the preparation and execution of this Agreement
and any subsequent consent, agreement, approval, waiver or
amendment to it; and
(b) (ENFORCEMENT): the enforcement, attempted enforcement, or the
preservation of any rights under this Agreement, including
without limitation, any expenses incurred in the evaluation of
matters of material concern to a Financier.
8.2 STAMP DUTIES
(a) (PAYMENT OF ALL DUTIES): The Unitholders and the Trustee must
pay all stamp, loan transaction, registration and similar Taxes,
including fines and penalties, financial institutions duty and
debits tax which may be payable or required to be paid by any
appropriate authority or determined to be payable in connection
with the execution, delivery, performance or enforcement of this
Agreement or any payment or receipt or any other transaction
contemplated by it.
(b) (INDEMNITY): The Unitholders and the Trustee will indemnify and
keep indemnified each Financier against any loss or liability
incurred or suffered by it as a result of the delay or failure
by the Unitholders or the Trustee to pay such Taxes.
9. ASSIGNMENTS
9.1 ASSIGNMENTS BY THE FINANCIER
A Financier may at any time assign or otherwise transfer all or any part
of its rights or obligations under this Agreement to another bank or
financial institution and may disclose to a proposed assignee or
transferee information in the possession of the Financier relating to the
Unitholders or the Trustee.
6.
<PAGE> 653
9.2 SUCCESSORS AND ASSIGNS
This Agreement is binding on and enures to the benefit of each party to
it and its respective successors and permitted assigns.
9.3 SYNDICATION
(a) Each Unitholder and the Trustee acknowledges that a Financier
(as defined in the Warehouse Facility Agreement) may transfer
part of its rights and obligations under the Transaction
Documents (including this Agreement) to another bank or
financial institution pursuant to clause 18 of the Warehouse
Facility Agreement, and agrees that if this occurs the New
Financier shall, with effect from the "Substitution Date"
specified in the relevant Substitution Certificate, be bound by
the Transaction Documents (including this Agreement) to the
extent stated in the Substitution Certificate, and the
Unitholders and the Trustee shall be bound to the New Financier
accordingly.
(b) The execution by the Unitholders of this Deed shall constitute
any offer by the Unitholders to all New Financiers of the
matters set out in paragraph (a), which may be accepted by the
New Financier executing a Substitution Certificate.
10. GOVERNING LAW AND JURISDICTION
10.1 GOVERNING LAW
This Agreement is governed by and construed in accordance with the laws
of New South Wales.
10.2 JURISDICTION
(a) (ACCEPTANCE OF JURISDICTION): Each Financier, the Unitholders,
the Security Trustee and the Trustee irrevocably submit to and
accept, generally and unconditionally, the non-exclusive
jurisdiction of the courts and appellate courts of New South
Wales with respect to any legal action or proceedings which may
be brought at any time relating in any way to this Agreement.
(b) (NO OBJECTION TO INCONVENIENT FORUM): Each Financier, the
Unitholders, the Security Trustee and the Trustee irrevocably
waive any objection they may now or in the future have to the
venue of any such action or proceedings and any claim they may
now or in the future have that any such action or proceedings
have been brought in an inconvenient forum.
7.
<PAGE> 654
11. MISCELLANEOUS
11.1 EXERCISE OF RIGHTS
The Financiers may exercise a right, power or remedy at their discretion,
and separately or concurrently with another right, power or remedy. A
single or partial exercise of a right, power or remedy by the Financiers
does not prevent a further exercise of that or of any other right, power
or remedy. Failure by the Financiers to exercise or delay in exercising a
right, power or remedy does not prevent its exercise subsequently. The
Financiers are not liable for any loss caused by the exercise, attempted
exercise, failure to exercise or delay in exercising a right, power or
remedy.
11.2 REMEDIES CUMULATIVE
The rights, powers and remedies conferred by this Agreement on the
Financiers are cumulative and in addition to all other rights, powers or
remedies available to the Financiers by law or by virtue of any other
instrument.
11.3 SURVIVING INDEMNITIES
Each indemnity in this Agreement is a continuing obligation, separate and
independent from the other obligations of the Trustee and the Unitholders
and survives termination of this Agreement.
11.4 COUNTERPARTS
This Agreement may be executed in a number of counterparts, all of which
taken together will be deemed to constitute one and the same document.
SIGNED as an agreement.
SIGNED for and on behalf of )
PHF NO. 1 PTY LIMITED, ACN 082 )
747 313 by ) .................................
) (Signature)
its Attorney under a Power of Attorney )
dated and who declares that he )
has not received any notice of the )
revocation of such Power of Attorney in )
the presence of: )
.......................................
(Signature of Witness)
8.
<PAGE> 655
.......................................
(Name of Witness in Full)
SIGNED for and on behalf of )
TANOA PTY LIMITED, ACN 001 396 ) .................................
989 by ) (Signature)
)
its Attorney under a Power of Attorney )
dated and who declares that he )
has not received any notice of the )
revocation of such Power of Attorney in )
the presence of: )
.......................................
(Signature of Witness)
.......................................
(Name of Witness in Full)
9.
<PAGE> 656
SIGNED for and on behalf of )
PRINCIPAL HEALTHCARE FINANCE ) .............................
PTY LIMITED, ACN 069 875) 476 by ) (Signature)
)
)
)
its Attorney under a Power of Attorney dated )
and who declares that he has not )
received any notice of the revocation of such )
Power of Attorney in the presence of: )
.............................................
(Signature of Witness)
.............................................
(Name of Witness in Full)
SIGNED for and on behalf of ) .............................
ABN AMRO AUSTRALIA LIMITED, 000 ) (Signature)
862 797 by )
)
)
its Attorney under a Power of Attorney dated )
and who declares that he has not )
received any notice of the revocation of such )
Power of Attorney in the presence of: )
.............................................
(Signature of Witness)
.............................................
(Name of Witness in Full)
10.
<PAGE> 657
SIGNED for and on behalf of )
ABN AMRO BANK N.V., AUSTRALIAN )
BRANCH, ABRN 079 478 612 by ) .............................
) (Signature)
and )
)
its Attorneys under a Power of Attorney )
dated and who declare that they )
have not received any notice of the )
revocation of such Power of Attorney in the )
presence of: )
)
.............................................
(Signature of Witness)
.............................................
(Name of Witness in Full)
SIGNED for and on behalf of )
ABN AMRO FACILITIES AUSTRALIA )
LIMITED, ACN 001 035 543) by ) .............................
) (Signature)
its Attorney under a Power of Attorney dated )
and who declares that he has not )
received any notice of the revocation of such )
Power of Attorney in the presence of: )
)
.............................................
(Signature of Witness)
.............................................
(Name of Witness in Full)
11.
<PAGE> 658
TABLE OF CONTENTS
CLAUSE PAGE
1. DEFINITIONS AND INTERPRETATION 1
1.1 DEFINITIONS 1
1.2 INTERPRETATION 2
2. WARRANTIES 3
3. ACKNOWLEDGEMENT REGARDING THE TRANSACTION DOCUMENTS 4
4. COVENANTS 4
4.1 EXECUTION OF DOCUMENTS 4
4.2 TRUSTEE 4
4.3 OPERATION AND MAINTENANCE OF TRUST 4
5. UNITHOLDERS 5
5.1 CONSENT 5
5.2 WAIVER 5
6. INDEMNITY 5
7. EVENTS OF DEFAULT 5
8. EXPENSES AND STAMP DUTIES 6
8.1 EXPENSES 6
8.2 STAMP DUTIES 6
9. ASSIGNMENTS 6
9.1 ASSIGNMENTS BY THE FINANCIER 6
9.2 SUCCESSORS AND ASSIGNS 6
9.3 SYNDICATION 6
10. GOVERNING LAW AND JURISDICTION 7
10.1 GOVERNING LAW 7
10.2 JURISDICTION 7
11. MISCELLANEOUS 7
(i)
<PAGE> 659
TABLE OF CONTENTS
CLAUSE PAGE
11.1 EXERCISE OF RIGHTS 7
11.2 REMEDIES CUMULATIVE 7
11.3 SURVIVING INDEMNITIES 8
11.4 COUNTERPARTS 8
(ii)
<PAGE> 660
TRIPARTITE AGREEMENT
DATE:
PHF NO. 1 PTY LIMITED
and
TANOA PTY LIMITED
each a Unitholder
PRINCIPAL HEALTHCARE FINANCE PTY LIMITED
Trustee
ABN AMRO AUSTRALIA LIMITED
and ABN AMRO BANK N.V., AUSTRALIAN BRANCH
each a Financier
ABN AMRO FACILITIES AUSTRALIA LIMITED
Security Trustee
(C) Copyright Clayton Utz
<PAGE> 1
EXHIBIT 10.2
ADVISORY AGREEMENT
THIS AGREEMENT IS MADE ON 1998
PARTIES
PRINCIPAL HEALTHCARE FINANCE PTY LIMITED, ACN 069 875 476 in its capacity as
trustee of the Trust of C/- Phillips Fox, 255 Elizabeth Street, Sydney, New
South Wales ("THE COMPANY")
OMEGA (AUSTRALIA) PTY LIMITED ACN 082 747 331 of C/- Phillips Fox, 255
Elizabeth Street, Sydney, New South Wales ("THE ADVISOR")
RECITALS
A. The Company, as trustee of the Trust, is in the business in
Australia of, inter alia, acquiring real estate for the
provision of health care services, which real estate is to be
leased to and operated by Health Care Operators.
B. The Advisor, its Related Entities and its employees have
experience in the administration of real estate assets used to
provide health care services and the origination, structuring
and evaluation of real estate and mortgage investments and
leasing activities related to the health care industry.
C. The Advisor has agreed to provide certain management,
administration and advisory services to the Company on the
terms and conditions set out in this Agreement.
AGREEMENT
1. DUTIES OF THE ADVISOR
0.1 The Advisor will provide such services and activities relating to the
assets, operations and business plans of the Company as may be
appropriate, including:
(a) assisting in the preparation of annual budgets and business
plans for approval by the Board ("the Business Plans");
(b) using its best efforts to present to the Company a continuing
investment program consistent with the investment policies and
objectives of the Company as set out in the Business Plans;
(c) using its best efforts to present to the Company investment
opportunities consistent with the Business Plans and such investment
program as the Board may adopt from time to time;
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(d) furnishing or obtaining and supervising the performance of the
administration of the day-to-day operations of the Company, including
the investment of reserve funds and surplus cash in short-term money
market investments;
(e) serving as one of the Company's investment and financial advisors and
providing research, economic, and statistical data in connection with
the Company's investments and investment and financial policies;
(f) assisting the Company in investigating, selecting and negotiating
with borrowers, lenders, mortgagors, brokers, investors, builders,
developers and others;
(g) consulting with the Board and providing the Board with advice and
recommendations with respect to the making, acquiring (by purchase,
investment, exchange, or otherwise), holding, and disposition
(through sale, exchange, or otherwise) of investments consistent with
the Business Plans;
(h) advising the Board with respect to such services as may be required
in acquiring and disposing of investments, disbursing and collecting
the funds of the Company, paying the debts and fulfilling the
obligations of the Company, and handling, prosecuting, and settling
any claims of the Company, including enforcing leases, guarantees,
mortgages and other encumbrances securing investments;
(i) assisting the Company in obtaining such services as may be required
for property management, loan disbursements, and other activities
relating to the investments of the Company, so long as the
compensation for such services is to be agreed to by the Company and
the service provider;
(j) advising the Company in connection with capital market activities;
(k) quarterly, and at any time requested by the Board making reports to
the Board regarding the Company's performance to date in relation to
the Company's current approved Business Plan and its various
components, as well as the Advisor's performance of its services
under this Agreement;
(l) making or providing appraisal reports, where appropriate, on
investments or contemplated investments of the Company;
(m) assisting in preparation of reports and other documents necessary to
satisfy the reporting and other requirements of any governmental
bodies or agencies and assisting in maintaining effective
communications with shareholders of the Company; and
(n) doing all things necessary to ensure its ability to render the
services contemplated herein, including providing office space and
office furnishings, computing and accounting equipment and personnel
necessary for the performance of the foregoing services as Advisor,
all at its own expense, except as otherwise expressly provided for
herein.
0.2 In performing its services under this Agreement, the Advisor acknowledges
that:
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(a) it is doing so pursuant to a delegation of day to day management
by the Board, which delegation remains under the supervision and
control of the Board; and
(b) the Board and not the Advisor maintains ultimate authority for the
conduct of the business of the Company.
0.3 The Company acknowledges that the Advisor will perform its services
under this Agreement through facilities, personnel and support services
located at its Australian, United States and United Kingdom offices
through personnel selected by the Advisor.
0.4 In performing its services under this Agreement, the Advisor may
utilise facilities, personnel and support services of various of its
affiliates, whether located within or outside Australia. The Advisor
shall reimburse such affiliates for their services and facilities out
of the compensation provided for in Section 10. Notwithstanding the
above, the Company may request, and will pay for the direct costs of,
additional services (as described in Section 12 of this Agreement).
The Advisor will engage in other activities related to real estate and
not related to the Company or its assets, as contemplated in Section
15.
1. NO PARTNERSHIP OR JOINT VENTURE
The Company and the Advisor are not partners or joint venturers with
each other. Nothing in this Agreement will be construed so as to make
them such partners or joint venturers or impose any liability as such
on either of them. Nothing contained in this Agreement authorises
either party to act as agent or representative of the other party or to
authorise either party to create any obligation on behalf of the other
party.
2. RECORDS
The Advisor must, at all times keep proper books of account and records
of the Company's affairs which shall be accessible for inspection by
the Company at the Advisor's principal office in Australia or at the
offices of its Related Entities in the United States and at any time
during business hours on giving reasonable notice.
3. BANK ACCOUNTS
The Advisor may establish and maintain one or more bank accounts in its
own name, and may collect and deposit into such account or accounts,
and disburse from any such account or accounts, any money on behalf of
the Company, under such terms and conditions as the Board may approve.
No funds in any such account shall be commingled with funds of the
Advisor or another party; and the Advisor shall from time to time
render appropriate accounting of such collections and payments to the
Board and to the auditors of the Company.
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4. BOND
4.1 The Advisor will maintain a fidelity bond with a responsible surety
company or a reputable bank in such amount as may be required by the
Board from time to time, covering all directors, officers, employees,
and agents of the Advisor handling funds of the Company and any
investment documents or records relating to investments of the Company.
4.2 The bond is for the benefit of the Company in respect of losses
arising from acts of directors, officers, employees, and agents
through theft, embezzlement, fraud, negligence, error, or omission or
otherwise.
4.3 The premium for the bond is to be at the expense of the Company. If
any director of the Company is an Affiliate of the Advisor, the
approval of a majority of the Board who are not so affiliated is
required for the Company to require such a bond for the Advisor.
5. INFORMATION FURNISHED TO ADVISOR
The Board has the right to change a Business Plan at any time. The
Board must promptly furnish a copy of any changes to any Business Plan
to the Advisor. The Company shall furnish the Advisor with a certified
copy of all financial statements, a signed copy of each report prepared
by independent certified chartered accountants, and such other
information with regard to the Company's affairs as the Advisor may
from time to time reasonably request.
6. CONSULTATION AND ADVICE
6.1 In addition to the services described above, the Advisor shall consult
with the Board and at the request of the Board will furnish advice and
recommendations with respect to any aspect of the business and affairs
of the Company, including any factors that in the Advisor's best
judgment should influence the policies of the Company.
6.2 The Advisor and the Company will confer as required concerning the
Advisor's staffing and personnel assigned to perform the services of
the Advisor hereunder, with the goal that the Advisor will employ
highly qualified professional staff, in whom both the Advisor and the
Company repose confidence and trust.
7. ANNUAL BUSINESS PLAN AND BUDGET
7.1 The Advisor will assist the Company in the preparation of a Business
Plan for each financial year of the Company for submission to the
Board. Such Business Plan must include: a twelve-month projection of
operations and cash flow with explicit assumptions and a general plan
for asset sales or acquisitions, leasing, lending, enforcement and
borrowing activity, other investments or ventures and proposed
securities offerings or repurchases or any proposed restructuring of
the Company.
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7.2 To the extent possible, the Business Plan shall set out the Advisor's
recommendations and the basis therefor with respect to all material
investments of the Company. Upon approval by the Board, the Advisor
shall advise and assist in the conduct of the business of the Company
in accordance with the explicit provisions of the Business Plan,
specifically including the borrowing, leasing, maintenance, capital
improvements, renovations and sale of investments set forth in the
Business Plan.
7.3 Within forty five (45) days of the end of each calendar quarter, the
Advisor must provide the Board of Directors of the Company with a
report comparing the Company's actual performance for such quarter
against the Business Plan.
8. DEFINITIONS
8.1 The following terms will have the meanings set out below:
(a) "Adjusted Consolidated Net Income" means for any fiscal period the
consolidated net income for the Company and its consolidated
subsidiaries, (i) increased by (x) the amount of income allowable to
such fiscal period from zero-coupon investments or similar deferred
payment investments and (y) the amount of any increase in appraisal
write-up valuation of assets of the Company and its consolidated
subsidiaries as reported in annual valuations for such fiscal period
and decreased by the amount of any reduction in appraisal of assets
of the Company and its consolidated subsidiaries as reported in
annual valuations for such fiscal period.
(b) "Aggregate Book Value of Invested Assets" means the Book Value of
Invested Assets for all of the following as a group:
(i) the Company;
(ii) each Person that is a Related Entity of the Company; and
(iii) Securitisation Entity.
(c) "Board" means the board of directors of the Company as constituted
from time to time.
(d) "Book Value" of an asset or assets means the value of such asset or
assets as recorded on the books of any Person:
(i) before any appraisal write-up in accordance with Australian GAAP;
(ii) before provision for amortisation, depreciation, depletion or
valuation reserves; and
(iii) deducting any indebtedness or other liability in respect thereof.
(e) "Book Value of Invested Assets" means the Book Value of the total
assets of any nature or description owned, leased, managed or
operated by any Person (without deduction of any liabilities), but
excluding:
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(i) goodwill and other intangible assets;
(ii) cash; and
(iii) cash equivalent investments with terms which mature in one year or
less, and increased by the amount of any increase in appraisal
write-up of assets of the Company and its consolidated subsidiaries
as reported in annual valuations for such fiscal period and
decreased by the amount of any reduction in appraisal of assets of
the Company and its consolidated subsidiaries as reported in annual
valuations for such fiscal period.
(f) "Business Plan" means the Company's investment policies and
objectives and the capital and operating budget based thereon for the
relevant fiscal year of the Company as approved by the Board, as
modified or amended.
(g) "Change of Control" means, as to the Advisor:
(i) the election to the board of directors of the Advisor in a
contested election of directors of individuals comprising a
majority of directors who, immediately prior to the contested
election, were not members of the board of directors of the
Advisor; or
(ii) a change in the duties of the chairman and/or the chief executive
officer of the Advisor, which change prejudices the active
involvement of such officer or officers of the Advisor in the
performance of the Advisor's services under this Agreement.
(h) "Earnings per Share" means the Adjusted Consolidated Net Income of
the Company for any fiscal period, divided by the weighted average
number of ordinary shares outstanding for such fiscal period.
(i) "Health Care Operator" means an operator or manager of healthcare
facilities, (including aged care, nursing and/or residential care for
the aged, mentally infirm, chronically ill, intellectually or
physically disabled, hospitals and medical surgeries)
(j) "Invested Assets" shall mean the assets of any Person which are
managed by the Advisor.
(k) "Leases" means all leases and subleases from the Company and its
Related Entities to third party lessees and sublessees.
(l) "Mortgage Loans" means mortgages, debentures, bonds, and other
evidence of indebtedness or obligations, whether negotiable or
non-negotiable, and which are secured or collateralised by mortgages,
including first, wraparound, construction and development and second
or subordinated mortgages.
(m) "Person" means individuals, corporations, partnerships, joint stock
companies or associations, joint ventures, associations, companies,
trusts, banks, trust companies, land trusts, business trusts, or
other entities and governments and agencies and political
subdivisions thereof.
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(n) "Real Property" means land, interests in land, leasehold interests
(including but not limited to interests of a lessor or lessee
therein), and any buildings, structures, improvements, fixtures, and
equipment located on or used in connection with land, leasehold
interests, and rights in land or interests therein.
(o) "Related Entity" has the same meaning as is given to that
expression in the Corporation's Law and references to a body
corporate include a reference to a trust
(p) "Securitisation Entity" means any Person formed or availed of for the
purposes of financing and/or acquiring assets now owned, leased,
managed and/or operated by or to be owned, leased, managed and/or
operated by the Company or any Related Entity of the Company.
(q) "Trust" means the trust known as the Principal Healthcare Finance
Trust constituted by deed of trust dated 11 August 1995, as amended
from time to time.
8.2 All calculations made pursuant to this Agreement shall be based on
statements (which may be unaudited, except as provided herein) prepared
on an accrual basis consistent with Australian generally accepted
accounting principals, regardless of whether the Company may also
prepare statements on a different basis.
9. INVESTED ASSETS FEE: INCENTIVE FEE
9.1 On or before the twenty-eighth day of each month during the term of
this Agreement, the Company must pay to the Advisor, as compensation
for the management and advisory services rendered to the Company, a
fee at the rate of 0.075% per month of the average of the Aggregate
Book Value of the Invested Assets ("Invested Assets Fee") at the
beginning and at the end of the next preceding calendar month.
9.2 The annual rate of the Invested Assets Fee shall be 0.90% per annum.
Notwithstanding the foregoing, to the extent that Invested Assets
include assets held by a Securitisation Entity, the Invested Assets
Fee with respect to such assets shall accrue monthly and be paid
semi-annually on the date the Securitisation Entity makes a regularly
scheduled payment of interest and/or principal. The Invested Assets
Fee allowable to such assets, when paid, shall include a pro-rata
payment of interest and investment earnings earned by such
Securitisation Entity since the preceding payment date.
9.3 On or before the first day of the third calendar month following
receipt by the Company of its audited financial statements for the
prior year, the Company's auditors (or other third party acceptable to
the Advisor and the Company) shall determine whether the Earnings Per
Share for the financial year then ended based on weighted shares
outstanding, exceeded by at least fifteen percent (15%) the Earnings
Per Share for the preceding financial year (the "Target Earnings Per
Share")
9.4 In the event the Company shall have achieved Target Earnings Per Share
for any financial year, then the Company shall pay to the Advisor
within fourteen days after each determination referred to in clause
10.3, an incentive fee equal to two-tenths of one
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percent (0.02%) of the average of Aggregate Book Value of Invested
Assets (Incentive Fee). For purposes of the Incentive Fee, the
average of Aggregate Book Value of Invested Assets shall be determined
as the average of the Aggregate Book Value of Invested Assets on the
first day of the financial year and the Aggregate Book Value of
Invested Assets on the last day of the financial year.
9.5 Certain expenses and reimbursements described in Sections 13 and 14 of
this Agreement may be allocated in part to the account of the Advisor
and in part to the account of the Company, as may be agreed by the
parties.
10. STATEMENTS
Upon request, the Advisor must furnish to the Company not later than
the tenth (10th) day of each calendar month, beginning with the second
(2nd) calendar month of the term of this Agreement, a statement
showing the computation of the fees, if any, payable in respect to the
next preceding calendar month.
11. COMPENSATION FOR ADDITIONAL SERVICES
To the extent that the Company requests the Advisor or any director,
officer, partner, or employee of the Advisor or Related Entities of
the Advisor to render services for the Company other than those
required to be rendered by the Advisor hereunder, such additional
services, if performed, will be compensated separately on terms to be
agreed upon between such party and the Company from time to time.
12. EXPENSES OF THE ADVISOR
The Advisor will bear the following expenses, (subject to the
allocation provisions of Section 10):
(a) employment expenses of the personnel employed by the Advisor
including, but not limited to, fees, salaries, wages, payroll taxes,
travel expenses, and the cost of employee benefit plans and temporary
help expenses (including fees, salaries, and expenses paid to
directors, officers, and employees of the Advisor who are also
directors, officers or employees of the Company, when acting in such
capacity as directors, officers or employees of the Advisor);
(b) advertising and promotional expenses incurred in seeking investments
for the Company;
(c) rent, telephone, utilities, office furniture and furnishings, and
other office expenses of the Advisor;
(d) the cost of any internal accounting, statistical, bookkeeping or
computer equipment or computer time necessary for maintaining the
books and records of the Company; and
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(e) miscellaneous administrative expenses relating to performance by
the Advisor of its functions under this Agreement.
13. EXPENSES OF THE COMPANY
The Company must pay all of its expenses not assumed by or allocated to
the Advisor, including without limitation, the following expenses:
(a) the cost of money borrowed by the Company;
(b) income taxes, taxes and assessments on real property, and all other
taxes applicable to the Company;
(c) legal, auditing, accounting (other than internal accounting),
preparing all tax returns, underwriting, brokerage, listing,
registration and other fees, printing, engraving and other expenses,
and taxes incurred in connection with the insurance, distribution,
transfer, registration, and stock exchange listing of the Company's
securities;
(d) fees, salaries and expenses paid to directors, officers, and employees
of the Company;
(e) fees and expenses paid to independent advisors, independent
contractors, mortgage services, consultants, managers, local property
managers or management firms, accountants, attorneys and other agents
employed by or on behalf of the Company;
(f) expenses directly connected with the origination or purchase of
Mortgage Loans and with the acquisition, disposition, and ownership
of real estate equity interests, Leases or other property, including
the costs of enforcement, insurance, legal, protective, brokerage,
maintenance, repair, and property improvement services;
(g) expenses of maintaining and managing real estate equity interests;
(h) insurance, as required by the Board (including liability insurance);
(i) the expenses of organising, revising, amending, converting, modifying,
or terminating the Company;
(j) expenses connected with payments of dividends or interest or
distributions in cash or any other form made or caused to be made by
the Board of Directors of the Company to holders of securities of the
Company;
(k) All expenses connected with communications to holders of securities
of the Company and the other bookkeeping and clerical work necessary
in maintaining relations with holders of securities, including the
cost of printing and mailing certificates for securities and proxy
solicitation materials and reports to holders of the Company's
securities;
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(l) the cost of any outside auditing necessary for maintaining the
books and records of the Company and the costs for preparing and filing
all required tax returns;
(m) transfer agent's, registrar's and trustee's fees and charges;
(n) legal, accounting, investment banking, and auditing fees and expenses
charged by independent parties for services provided to the Company;
(o) out of pocket expenses incurred by the Advisor, arising from the
sales of Company properties, including those expenses related to
carrying out foreclosure and lease termination proceedings;
(p) costs and expenses associated with risk management (ie., insurance
relating to the Company's assets);
(q) loan refinancing compensation; and
(r) expenses associated with special services requested by the Board
pursuant to Section 12 hereof.
14. OTHER ACTIVITIES OF ADVISOR
14.1 Unless otherwise provided for in this Agreement, the Advisor, its
officers, directors, or employees or any of its Related Entities (and
such Related Entities officers, directors or employees) may engage in
other business activities relating to real estate investments or act as
advisor to any other Person, including those with investment policies
similar to the Company, and the Advisor and its officers, directors, or
employees and any of its Related Entities (and such Related Entities
officers, directors or employees) shall be free from any obligation to
present to the Company any particular investment opportunity that comes
to the Advisor or such persons, regardless of whether such opportunity
is in accordance with the Company's Business Plans.
14.2 Nothing in this Agreement shall prevent any director, officer or
employee of the Advisor, or any Related Entity (and such Related
Entities officers, directors, or employees) from engaging in any other
business or from rendering services of any kind to any other Person
(including competitive business activities).
14.3 Neither the Company nor its Related Entities, nor their respective
directors, officers, or employees, shall act as an advisor to, or agree
to act as an advisor to, any other Person with respect to real property
located in Australia and used for health care purposes, without the
prior written consent of the Board.
14.4 Directors, officers, employees and agents of the Advisor of its
Related Entities may serve as directors, employees, agents, nominees
or signatories of the Company. When executing documents or otherwise
acting in such capacities for the Company, such persons shall use
their respective titles in the Company.
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15. TERM; TERMINATION OF AGREEMENT
15.1 This Agreement shall commence on the date hereof ("the Effective
Date") and, subject to the automatic extension and early termination
provisions of this Agreement, shall continue for a period of seven
years ("Termination Date") and continue thereafter unless terminated
by either party as set forth below.
15.2 Beginning on the Termination Date and continuing as of each 1 January
thereafter, the term of this Agreement will automatically be extended
for one additional year unless either party exercises the early
termination rights described in the following sentence referred to in
subclause 16.3.
15.3 By written notice delivered to the other party not later than
15 November of any calendar year, either party may elect to avoid the
automatic extension of the term. For example, if a party gives notice
on or before 15 November 2005 of its election to avoid the automatic
extension provision of this Agreement, the term of this Agreement
would end on 31 December 2005.
15.4 During the ninety (90) day period following a Change in Control, the
Company shall have the right to elect to terminate this Agreement, by
notice given to the Advisor. Such termination shall be effective one
hundred eighty (180) days following the Advisor's receipt of notice of
termination from the Company.
15.5 If any director of the Company is an Related Entity of the Advisor,
the approval of a majority of the Board not so Related Entity shall be
required for the Company to make the election described in subclause
16.4.
15.6 If this Agreement is terminated pursuant to this Section 16, such
termination shall be without further liability or obligation of either
party to the other as of the Termination Date, except as provided in
Section 20. In no event shall such termination limit the Advisor's
right to indemnification pursuant to Section 21 hereof with respect to
any acts or omissions undertaken by Advisor prior to such termination.
16. AMENDMENTS
This Agreement shall not be changed, modified, terminated or discharged
in whole or in part except by an instrument in writing signed by both
parties hereto, or their respective successors or assigns, or otherwise
as provided herein. If any director of the Company is an Related Entity
of the Advisor, the approval of a majority of the Board who are not
Related Entity shall be required for the Company to amend this
Agreement.
17. DEFAULT, BANKRUPTCY, ETC
17.1 At the option solely of the Board, this Agreement shall be terminated
immediately upon written notice of termination from the Board to the
Advisor if any of the following events shall occur:
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(a) if the Advisor breaches any provision of this Agreement, and after
notice of breach does not remedy such default within thirty (30)
days, or, such longer period as may be appropriate if not susceptible
of being remedied within the thirty (30) days; or
(b) if the Advisor shall be adjudged or insolvent by a court of competent
jurisdiction, or an order is made by a court of competent
jurisdiction for the appointment of a receiver, liquidator, or
trustee of the Advisor or of all or substantially all of its property
by reorganisation, and such adjudication or order shall remain in
force or unstayed for a period of sixty (60) days; or
(c) if the Advisor is placed under administrationor for relief under any
law for the relief of debtors, or shall consent to the appointment of
a receiver of itself or of all or substantially all its property, or
shall make a general assignment for the benefit of its creditors, or
shall admit in writing its inability to pay its debts generally, as
they become due.
17.2 The Advisor agrees that if any of the events specified in subsections
(b) and (c) of this Section 18.1 occurs, it will give written notice
thereof to the Board within seven (7) days after such occurrence. If
any director of the Company is an Related Entity of the Advisor, the
approval of a majority of the Board who are not so Related Entity
shall be required for the Company to give any notice described in this
Section.
18. ASSIGNMENT
18.1 The Advisor may assign this Agreement to any Related Entity of the
Advisor, provided that at the time of the assignment the assignee (a)
assumes and agrees to be bound by this Agreement; and (b) is controlled
by a board of directors, a majority of whom are members of the Board of
Directors of the Advisor and (c) has as its chief executive officer the
individual who is chief executive officer or chairman of the Advisor.
Such an assignment or any other assignment of this Agreement by the
Advisor shall bind the assignee thereunder in the same manner as the
Advisor is bound hereunder.
18.2 The Advisor may also assign this Agreement to a corporation,
association, trust, or other successor organisation which may take over
the property and carry on the affairs of the Advisor, provided that
following such assignment the persons who controlled the operations of
the Advisor immediately prior to the assignment shall control the
operation of the successor organisation, including the performance of
its duties under this Agreement and they shall be bound by the same
restrictions by which they were bound to such assignment.
18.3 This Agreement shall not otherwise be assignable by the Advisor
without the prior written consent of the Company. This Agreement shall
not be assignable by the Company without the prior written consent of
the Advisor, except in the case of any assignment by the Company to a
corporation or other organisation which is the successor to the
Company, in which case such successor shall be bound hereby and by the
terms of said assignment in the same manner and to the same extent as
the Company is bound hereby.
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19. ACTION UPON TERMINATION
19.1 From the effective date of termination of this Agreement, pursuant to
Sections 16, 18 and 19 the Advisor shall not be entitled to
compensation for further services but shall be paid all compensation
accruing to the date of termination. The Advisor shall be deemed to
have earned one-twelfth of the Incentive Fee of each full calendar
month during which it provides services to the Company under this
Agreement. The Advisor shall forthwith upon such termination:
(a) pay over to the Company all moneys collected and held for the account
of the Company pursuant to this Agreement;
(b) deliver to the Board a full accounting, including a statement showing
all payments collected by it and a statement of any moneys held by
it, covering the period following the date of the last accounting
furnished to the Board; and
(c) deliver to the Board all property and documents of the Company then in
the custody of the Advisor.
19.2 For a period of one year following the date of termination of this
Agreement, neither the Company nor any Related Entity of the Company
shall, directly or indirectly, offer employment (including, but not
limited to consulting arrangements) to any employee of the Advisor or
any Related Entity of the Advisor without the prior written consent of
the Advisor, which consent may be freely withheld.
20. LIMITS OF ADVISOR RESPONSIBILITY
20.1 The Advisor assumes no responsibility other than to render the
services described herein in good faith and shall not be responsible
for any action of the Company in following or declining to follow any
advice or recommendation of the Advisor. The Advisor, its
shareholders, directors, officers, agents, employees and Related
Entities will not be liable to the Company, its shareholders, or
others, except by reason of acts constituting bad faith, wilful or
wanton misconduct or gross negligence.
20.2 The Company shall reimburse, indemnify and hold harmless the Advisor,
its shareholders, directors, officers, agents and employees and its
Related Entities for and from any and all expenses, losses, damages,
liabilities, demands, charges and claims of any nature whatsoever in
respect to or arising from any acts or omissions of the Advisor
undertaken in good faith and in accordance with the standard set forth
above pursuant to the authority granted to it by this Agreement.
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21. NOTICES
21.1 Any notice, report, or other communication required or permitted to be
given hereunder shall be in writing unless some other method of giving
such notice, report, or other communication is accepted by the party
to whom it is given, and shall be effectively when transmitted by
telecopier, delivered or, in the case of mailed notice or notice sent
by overnight courier, upon receipt thereof as conclusively evidenced
by the signed receipt thereafter by being delivered at the end
addresses of the parties thereto:
THE BOARD AND/OR THE COMPANY:
Principal Healthcare Finance Pty Limited
c/o Phillips Fox
255 Elizabeth Street
Sydney, New South Wales
Attention: Kevin Moss/ Bill Chapman
Telephone: (02) 9286 8000
Fax: (02) 9283 4144
THE ADVISOR:
Omega (Australia) Pty Limited
c/o Phillips Fox
255 Elizabeth Street
Sydney, New South Wales
Attention: Kevin Moss/Bill Chapman
Facsimile: (612) 9283 4144
with a copy, in the case of both the Company and the Advisor,
to:
Omega Worldwide, Inc,
900 Victors Way, Suite 345
Ann Arbor, MI 48103
Attention: Essel W Bailey, Jr - President
Telephone: (313) 747-9790
Fax: (734) 887 0301
and to:
Omega (UK) Limited
145 Cannon Street, London, EC4N 5 BP
Attention: James P. Flaherty
Telephone: (171) 929 3444
Facsimile: (171) 929 3555
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21.2 Each party may at any time give notice in writing to the other party
of a change of its address for the purpose of this Section 22.
22. HEADINGS
The section headings hereof have been inserted for convenience of
reference only and shall not be construed to affect the meaning,
construction, or effect of this Agreement.
23. GOVERNING LAW; CONSENT TO JURISDICTION
This agreement shall be governed and controlled as to validity,
enforcement, interpretation, construction, effect and in all other
respects by the statutes, laws and decisions of New South Wales. The
Company consents to in personam jurisdiction before the state and
federal courts in New South Wales and agrees that all disputes
concerning this agreement may be litigated, in Advisor's sole
discretion and at Advisor's sole election, only in courts located in
New South Wales. The company agrees that service of process may be
effected upon in under any method permissible under the laws of New
South Wales and irrevocably waives any objection to venue in the state
or federal courts of New South Wale].
24. JOINDER
The Company shall cause each Related Entity and Securitisation Entity
to join in this Agreement for purposes of determining the Invested
Assets Fees and Incentive Fees payable to the Advisor under this
Agreement.
25. ENTIRE AGREEMENT
This Agreement constitutes the entire agreement of the parties hereto
with respect to the subject matter hereof and supersedes and cancels
any pre-existing agreements with respect to such subject matter.
<PAGE> 16
16
EXECUTED AS AN AGREEMENT
Signed for and on behalf of PRINCIPAL HEALTHCARE FINANCE PTY LIMITED in the
presence of:
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Signature of witness Signature of authorised person
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Name of witness (print) Name of authorised person (print)
Signed for and on behalf of OMEGA (AUSTRALIA) PTY LIMITED in the presence of:
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Signature of witness Signature of authorised person
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Name of witness (print) Name of authorised person (print)
<PAGE> 17
17
<PAGE> 18
18
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ADVISORY AGREEMENT
PRINCIPAL HEALTHCARE FINANCE PTY LIMITED
OMEGA (AUSTRALIA) PTY LIMITED
-----------------------------------------------------------------------
[GRAPHIC OMITTED]
255 Elizabeth Street Sydney NSW 2000 Australia
Tel +61 2 9286 8000 Fax +61 2 9283 4144 DX 107 SYDNEY
Email: [email protected]
WWW site: http://www.PhillipsFox.com.au
<PAGE> 19
19
Ref:WGC:940906
<PAGE> 20
20
CONTENTS
1. DUTIES OF THE ADVISOR 1
2. NO PARTNERSHIP OR JOINT VENTURE 3
3. RECORDS 4
4. BANK ACCOUNTS 4
5. BOND 4
6. INFORMATION FURNISHED TO ADVISOR 4
7. CONSULTATION AND ADVICE 5
8. ANNUAL BUSINESS PLAN AND BUDGET 5
9. DEFINITIONS 5
10. INVESTED ASSETS FEE: INCENTIVE FEE 8
11. STATEMENTS 9
12. COMPENSATION FOR ADDITIONAL SERVICES 9
13. EXPENSES OF THE ADVISOR 9
14. EXPENSES OF THE COMPANY 10
15. OTHER ACTIVITIES OF ADVISOR 11
16. TERM; TERMINATION OF AGREEMENT 12
17. AMENDMENTS 13
18. DEFAULT, BANKRUPTCY, ETC 13
19. ASSIGNMENT 14
20. ACTION UPON TERMINATION 14
21. LIMITS OF ADVISOR RESPONSIBILITY 15
22. NOTICES 16
23. HEADINGS 17
<PAGE> 21
21
24. GOVERNING LAW; CONSENT TO JURISDICTION 17
25. JOINDER 17
26. ENTIRE AGREEMENT 17
<PAGE> 1
EXHIBIT 10.3
PROMISSORY NOTE
A$24,000,000 Dated November 12 1998
Ann Arbor, Michigan
FOR VALUE RECEIVED, PRINCIPAL HEALTHCARE FINANCE TRUST, an Australian Unit
Trust (the "Borrower"), hereby promises to pay to the order of OMEGA HEALTHCARE
INVESTORS, INC., a Maryland corporation (the "Holder"), on the Maturity Date (as
hereafter defined) the principal sum of Twenty Four Million Australian Dollars
(A$24,000,000), together with accrued interest thereon. Interest upon the unpaid
principal amount of this Note shall accrue at the rate of ten percent (10%) per
annum from the date specified above, until paid. Interest shall be calculated on
the actual number of days outstanding, computed on the basis of a year of 365 or
366 days, as applicable. The unpaid principal balance of this Note and all
accrued and unpaid interest thereon shall be due and payable on or before that
date (the "Maturity Date") that is the earlier to occur of (i) December 31, 1998
and (ii) five days following the date the Borrower consummates a transaction in
which it raises additional financing (whether equity or debt) in an amount not
less than A$24,000,000 plus the amount of accrued interest thereon as of the
date of the proposed payment of this Note. After the Maturity Date, interest on
the unpaid principal balance and /or all accrued and unpaid interest shall
accrue at a rate per annum equal to twelve percent (12%) (the "Default Rate").
Notwithstanding anything express or implied herein to the contrary, at no time
shall the outstanding principal balance owing hereunder bear interest at a rate
in excess of the maximum rate permitted by law. Any amount owing hereunder may
be prepaid at any time by the Borrower without penalty or premium.
Notwithstanding anything express or implied in this Note to the contrary, if
an Event of Default occurs, then the Holder may, in its sole and absolute
discretion and without prior notice to the Borrower, undertake one or more of
the actions that follow: (i) charge interest at the Default Rate hereinbefore
specified; and/or (ii) exercise any other right granted to the Holder at law or
in equity. An event of default (an "Event of Default") shall be deemed to have
occurred if the Borrower fails to pay the principal amount plus accrued interest
thereon at the Maturity Date. The Borrower agrees to reimburse the Holder of
this Note for any and all costs and expenses (including, without limitation,
reasonable attorneys' fees and expenses) incurred in collecting or attempting to
collect this Note.
The Borrower hereby represents and warrants to the Holder as follows: (i)
the Borrower has the corporate power and authority to execute, deliver and
perform this Note, to borrow money in accordance with its terms, and to do any
and all other things required of it hereunder; (ii) this Note is a valid and
binding obligation of the Borrower, legally enforceable in accordance with its
terms except as such enforceability may be limited by bankruptcy, insolvency,
reorganization, moratorium or other similar laws of general application
affecting the enforcement of creditors' rights generally; (iii) the execution,
delivery and performance of this Note, and the borrowings hereunder (A) have
been duly authorized by all requisite corporate action, (B) will not violate any
provision of any order
<PAGE> 2
of any court or other agency of government applicable to the Borrower, its
governing documents or any provision of any agreement, indenture, or other
instrument to which the Borrower is a party, or by which it or any of its
properties or assets are bound, (C) will not be in conflict with, result in a
breach of or constitute (with or without due notice and/or passage of time) a
default under any such agreement, indenture, or other instrument, and (D) will
not result in the creation or imposition of any lien, charge or encumbrance of
any nature whatsoever upon any of the properties or assets of the Borrower,
except with respect to (B), (C) and (D) for any such violation, conflict,
breach, default, lien, charge or encumbrance for any of the foregoing which will
not have a material adverse effect upon the Borrower. All of the foregoing
representations and warranties shall survive the execution and delivery of this
Note and any renewals, extensions, consolidations, restatements and/or
amendments hereof.
The Borrower hereby waives presentment, demand for payment, notice of
protest and all other demands and notices in connection with the delivery,
acceptance, performance or enforcement hereof.
This Note is secured by that certain Guaranty, of even date herewith, given
by Omega Worldwide, Inc., a Maryland corporation, in favor of the Holder.
This Note shall bind the Borrower and the Borrower's successors and assigns.
Except as provided in the preceding sentence, neither the benefits nor the
obligations under this Note may be assigned by the Borrower or the Holder
without the consent of the other party hereto.
This Note shall be construed and interpreted in accordance with the laws of
the State of Michigan, United States of America, without giving effect to the
conflicts of laws principles thereof.
IN WITNESS WHEREOF, this Note has been duly and validly executed on behalf
of the Borrower as of the day and year first above written.
PRINCIPAL HEALTHCARE FINANCE TRUST
By:
--------------------------------
Its:
-------------------------------
2
<PAGE> 3
GUARANTY
THIS GUARANTY is made as of November 12, 1998, by Omega Worldwide, Inc., a
Maryland corporation (the "Guarantor"), in favor of Omega Healthcare Investors,
Inc., a Maryland corporation ("OHI").
Concurrently with the execution of this Guaranty, Principal Healthcare
Finance Trust, an Australian Unit Trust (the "Borrower"), has executed and
delivered to OHI a Promissory Note in the aggregate principal amount of Twenty
Four Million Australian Dollars (A$24,000,000) (the "Note") which evidences the
indebtedness of the Borrower to OHI. To induce OHI to accept the Note, the
Guarantor is willing to execute this Guaranty.
In consideration of the premises hereof, the Guarantor covenants and agrees
with OHI as follows.
1. GUARANTY. The Guarantor guarantees the punctual payment and prompt and
complete performance of any and all indebtedness or obligations of any kind
which the Borrower now owes and which it may at any time hereafter owe to OHI to
the extent arising from, under or pertaining to the Note (the "Indebtedness"),
together with reasonable attorneys' fees and all other reasonable costs and
expenses which may be incurred by OHI in the enforcement or collection of this
Guaranty which shall be deemed to be part of the Indebtedness guaranteed by the
Guarantor.
2. WAIVER BY THE GUARANTOR. To the extent permitted by law, the Guarantor
waives the following: Notice of the acceptance of this Guaranty or of any
Indebtedness of the Borrower by OHI; presentment, demand, protest, notice of
protest, and notice of dishonor, or any other notice of non-payment of any of
the Indebtedness of the Borrower; and any and all other notices to which the
Guarantor might otherwise be entitled in connection with the Indebtedness herein
guaranteed.
3. MODIFICATION OF INDEBTEDNESS. The Guarantor consents to the following,
none of which shall effect or discharge its liability hereunder in any way: Any
extension of the time of payment of the whole or part of any indebtedness
granted to the Borrower by OHI; any change in the terms of payment of the
Indebtedness to OHI; the acceptance, alteration, substitution, disposition or
release of any security, whether provided by the Borrower or any other person.
4. NATURE, SCOPE, AND DURATION OF GUARANTY.
a. This Guaranty is a continuing guaranty covering the Indebtedness of
the Borrower as herein described and is to remain in full force and effect until
the guaranteed Indebtedness described has been paid. This is a continuing,
indivisible, and cumulative guaranty of the Indebtedness owing from the Borrower
to OHI either at the date hereof or at any time hereafter during the term of
this Guaranty arising out of the Indebtedness.
<PAGE> 4
Revocation of this Guaranty by the Guarantor (by notice or by the passage of
time) shall in no way terminate or otherwise affect (a) any liability or
obligation of the undersigned, its successors or assigns existing on or prior to
the effective date of such revocation or (b) any liability or obligation of the
undersigned, its successors or assigns, arising after the effective date of such
revocation with respect to any portion of the Indebtedness incurred by the
Borrower to OHI on or before the effective date of such revocation and the
undersigned hereby expressly agrees to the foregoing on behalf of itself, and
its successors and assigns.
b. The Guarantor guarantees that all payments on the Indebtedness made by
the Borrower will, when made, be final. The Guarantor agrees that if any
such payment is recovered from or repaid by OHI, in whole or in part, for
any reason, this Guaranty shall continue to be fully applicable to the
Indebtedness to the same extent as though the payment so recovered or
repaid had never been originally made on the Indebtedness.
c. The Guarantor's liability is direct, primary and unconditional, and
may be enforced by OHI without first resorting to any other right, remedy
or security, including, without limitation, any right or remedy against
the Borrower or any other person or entity who is or becomes liable in
any manner, with respect to the Indebtedness or any property constituting
security for any of the Indebtedness.
5. WAIVER BY OHI. The failure of OHI to enforce any of the provisions of
this Guaranty at any time or for any period of time shall not be construed to be
a waiver of any such provision or of the right thereafter to enforce the same.
6. DISCHARGE OF LIABILITY. The Guarantor may discharge its liability under
this Guaranty at any time upon the payment to OHI of immediately available
unrecoverable funds in an amount equal to the Indebtedness as indicated in the
books and records of OHI and communicated to the Guarantor by OHI upon the
Guarantor's written request, provided, however, that failure on the part of OHI
to inform the Guarantor of the amount of the Indebtedness shall not in any way
or manner affect the Guarantor's liability hereunder.
7. APPLICABLE LAW. This Guaranty and its interpretation and application
shall in all respects be governed by the law of the State of Michigan, without
regard to its conflicts of law principles.
8. ENTIRE AGREEMENT. This instrument contains the entire and only agreement
between the Guarantor and OHI with respect to the guaranty of the Indebtedness
by the Guarantor, and any representation, promise, condition, or understanding
in connection therewith which is not expressed in this instrument shall not
2
<PAGE> 5
be binding on OHI or upon the Guarantor, all prior collateral understandings and
agreements concerning such Guaranty having been superseded by this instrument.
This Guaranty Guaranty is fully and voluntarily given to OHI by the Guarantor,
without any duress or coercion, and after the Guarantor has either consulted
with counsel or has been given the opportunity to do so, and after the Guarantor
has carefully and completely read all of the terms and provisions of this
Guaranty. The provisions of this instrument shall not be changed or discharged
except by a written instrument signed by an authorized representative of OHI and
of the Guarantor and dated subsequent to the date hereof.
OMEGA WORLDWIDE, INC.
By:
---------------------------------
Its:
-------------------------
3
