Electronically FILED by Superior Court of California, County of Los Angeles on 03/11/2020 04:10 PM Sherri R. Carter, Executive Officer/Clerk of Court, by R. Perez,Deputy Clerk XAVIER BECERRA Exempt from filingfees pursuant to Government Code section 6103 Attorney General of California JENNIFER M. ICIM Supervising Deputy Attorney General BENJAMIN G. DIEHL Deputy Attorney General State Bar No. 192984 300 South Spring Street, Suite 1702 Los Angeles, CA 90013 Telephone: (213) 269-6687 Fax: (916) 731-2125 E-maih Benjamin.DiehlCecdoj.ca.gov Attorneys for Petitioner Sonia Angell, rtfD, MPH, Director of the California Department ofPublic Health SUPERIOR COURT OF THE STATE OF CALIFORNIA COUNTY OF LOS ANGELES, CENTRAL DISTRICT 10 12 13 14 SONIA ANGELL, MD, MPH, DIRECTOR, CALIFORNIA DEPARTMENT OF PUBLIC HEALTH, Case No. 20STCP01013 REQUEST FOR JUDICIAL NOTICE IN SUPPORT OF EX PARTE APPLICATION I'OR ORDER APPOINTING TEMPORARY RECEIVER AND FOR ORDER TO SHOW CAUSE RE APPOINTMKNT OF RECEIVER; MEMORANDUM OF POIINTS AND AUTHORITIKS 15 Petitioner, 16 V. 17 18 19 20 LEGACY HEALTHCARE CENTER, LLC, a California limited liability company; ROSE GARDEN SUBACUTE k REHABILITATION CENTER, LLC, a California limited liability company; and DOES I THROUGH 20, INCLUSIVE, Ex Parte Hearinv.: Dept: 85 Date: March 13, 2020 Time: 8:30 a.m. Judge: Hon, James C. Chalfant 21 Respondents. 22 [RELATED TO CASE NO, 20STCV04552] 23 24 25 Ptusuant to Evidence Code'ection 452, Petitioner Sonia Angell, MD, MPH, Director of the California Department of Public Health (Petitioner) respectfully requests that the Court tal&e 26 judicial notice of the pleading entitled "Declaration of Arlene H. Rosales, as Trustee of the Arlene 27 28 'll further statutory references are to the Evidence Code unless noted otherwise, I REQUEST FOR JUDICIAL NOTICE (Case No. 20STCPO I 0131 1 including the exhibits thereto, filed in the Los Angeles County Superior Court in the matter 2 Arlene H. Jlosales, et al., 3 February 5, 2020 (the Rosales Declaration). A true and correct copy of the Rosales Declaration is 4 attached as Exhibit l. 5 v. Legacy Heal(hcare Center, LLC, et al., case no. 20STCV04552, on A court ntay take judicial notice of'the records of any court of this state () 452, subd. (d)). 6 The pleading attached as Exhibit 7 record of this court. Accordingly, Petitioner respectfully requests that this Court take judicial 8 notice of the Rosales Declaration pursuant to section 452. 10 1 is an appropriate matter for judicial notice because it is a Dated: March Q, 2020 Respectfully Submitted, XAVIER BECERRA Attorney General of California JENNIFER M. KIM 12 Supervising Deputy Attorney General 13 14 15 BENJAMIN G. DIEHL Deputy Attorney General Attorneys for Sonia Angell, MD, MPH, Director of the California Department of Public Health 16 17 18 LA2020500725 541II4132.eIocx 21 22 23 24 25 26 27 28 2 REQUEST FOR JUDICIAL NOTICE (Case No. 20STCPO l 0131 1 including the exhibits thereto, filed in the Los Angeles County Superior Court in the matter 2 Arlene H. Rosales, et al., 3 February 5, 2020 (the Rosales Declaration). A true and correct copy of the Rosales Declaration is 4 attached as Exhibit 5 V. Legctcy Healthcare Center, LLC, et al., case no. 20STCV04552, on 1. A court may take judicial notice of the records of any court of this state (II 452, subd. (d)). 6 The pleading attached as Exhibit 7 record of this court. Accordingly, Petitioner respectfully requests that this Court take judicial 8 notice of the Rosales Declaration pursuant to section 452. 1 is an appropriate matter for judicial notice because it is a 9 10 Dated: March(~, 2020 Respectfully Submitted XAVIER BECERRA Attorney General of California JENNIFER M. KIM 12 Supervising Deputy Attorney General 13 14 15 BENJA Deputy Attorney General Attorneys for Sonia Angell, MD, MPH, Director of the California Departmen( of Public Health 16 17 18 19 LA2020500725 541II4132.docx 21 22 23 24 25 26 27 REQUEST FOR JUDICIAL NOTICE (Case No. a . ill ?with .. . EXHIBIT 1 1 3 I 4 Dawn M. Coulson, SBN 154085 Gabriel M. Courey, SBN 304489 EPPS dr, COULSON, LLP 1230 Crenshaw Blvd., Ste. 200 Torrance, California 90501 (213) 929-2390 - Telephone (213) 929-2394 Facsimile — 5 Attorneys for Plaintiffs, Arlene H. Rosales, as Trustee of The Arlene H, Rosales Living Trust dated February 2, 2012; and David Ross II, LLC 8 SUPERIOR COURT OF THE STATE OF CALIFORNI~ 10 IN AND FOR THK COUNTY OF LOS ANGELES ARLENE H. ROSALES, AS TRUSTEE OF THE ARLENE H. ROSALES LIVING TRUST DATED FEBRUAP.Y 2„2012; and DAVID ROSS II, LLC, a California limited liability company, Plaintiffs, 17 18 19 20 LEGACY HEALTHCARECENTER,LLC,a Cahfornia limited liability company; ROSE GARDEN SUBACUTE k REHABILITATION CENTER, LLC a California limited liability company; DOV E. JACOBS, an individual; TAUB, an individual; and DOES 1 through 10, inclusive, ~ 21 Case No,: ÃSTt.',"II,. 4558 DECLARATION OF ARLENK H. ROSALES, AS TRUSTEE OF THK ARLENE H. ROSALES LIVING TRUST DATED FEBRUARY 2& 2012, AND AS PRESIDENT OF DAVID ROSS H, LLC IN SUPPORT OF APPLICATION FOR EX PARTE ORDER APPOINTING RECEIVER AND FOR ORDER TO SHOW CAUSE RE CONFIRMATION OF APPOINTMKNT AND TEMPORARY RESTRAINING ORDER Defendants, 22 23 24 25 Arlene H. Rosaies, as Trustee of The Arlene H. Rosales Living Trust dated February 2, 2012, and as president of David Ross Il, LLC, declares: 1. I am the Trustee of The Arlene H. Rosales Living Trust dated February 2, 2012, and president of David Ross II, LLC, the Plaintiffs in this action (collectiveiy, "Plaintitfs"). I am 27 also a Registered Nurse. The facts stated in this declaration are within my personal knowledge and, if called to testify, I could and v'auld competently testify to them. DECLARATION OF ARLENE H. ROSALES, AS TRUSTEE OF THE ARLENE H. ROSALES LIVING DATED FEBRUARY 2, 2012, AND AS PRESIDENT OF DAVID ROSS II, LLC IN SUPPORT OF APP FOR EX PARTE ORDER APPOINTING RECEIVER AND FOR ORDER TO SHOW CAUSE RE CONFIRMATION OF APPOINTMENT AND TEMPORARY RESTRAINING ORDER 1 Pn 4 The property that is the subject matter of this action is the land, buildings and 2 improvements thereon, as well as the furniture, fixtures and equipment for the operations of two 3 different skilled nursing facilities ("SNI"" or "facilities" ): (a) a ninety-five (95) bed skilled nursing 4 facility, twenty-one (21) of such beds being licensed subacute beds, as defined in California 5 Health and Safety Code Ij1250(c), licensed by the California Department of Public Health 6 ("CDPH"), Medicare and Medi-Cal certified, commonly known as "Rose Garden Healthcare 7 Center" located at 1899 North Raymond Avenue, Pasadena, California 91103 (" Rose," "Rose 8 Facility," or "Rose Property"}, and (b) a fifty-four (54) bed skilled nursing facility, licensed by the 9 CDPH, Medicare and Medi-Cal certified, and commonly known as "Legacy Healthcare Center" 10 located at 1570 North Fair Oaks Avenue, Pasadena, California 91103 (" Legacy," "Legacy 11 Facility," or "Legacy Property" ), 12 +" 2. 13 'j'-'4 3. Rose currently has 76 residents in-house and 6 bed-holds (e.g. holding beds for residents to return from a hospital stay), 4. Legacy currently has 44 residents in-house and 5. I am 5d, 1 bed-hold. knowledgeable about the standards and conditions required to safeguard the 16 health, safety, security, and rights of the residents at Rose and Legacy and the operations of both 17 facilities and the status and care of the Izsidents. My family members have operated the Rose and 18 Legacy Facilities from when we bought litem until when we leased them as turnkey facilities and 19 the facility equipment to the curreiit operator, Dov Jacobs (" Jacobs" ) and his entities, Legacy 20 IJealthcare Center, LLC, a California limited liability company (the "Legacy Operator" or 21 "Legacy Defendant" ) and Rose Garden Subacute Rehabilitation Center, LLC, a California limited 22 liability company (the "Rose Operator" or "Rose Defendant" ) in April 2016 (collectively, the 23 "Jacobs Companies" ). 24 6. The Rose I'acility/Property is in the possession of the Rose Defendant. The Rose 25 Defendant's address is 11600 26 number is (626) 797-2120. The Rose Defendant was the tenant and operator of the Rose 27 Property/Facility. The Rose Defendant is now a holdover tenant. AV. IVashington IJoulevard Los Angeles, CA 90066 and telephone 28 2 DECLARATION OF ARLENE H. ROSALES, AS TRUSTEE OF TI-IE ARLENE I-I. ROSALES LIVING TRUST DATED FEBRUARY 2, 2012, AND AS PRESIDENI OF DAVID ROSS II, LLC IN SUPPORT OF APPLICATION I"OR EX PARTE ORDER APPOINTING RECEIVER AND FOR ORDER TO SHOW CAUSE RE 7. Legacy Facility/Property is in the possession of the Legacy Del'endant. The Legacy Defendant's address is 11600 W. Washington Boulevard Los Angeles, CA 90066 and telephone number is (626) 798-0558. The Legacy Defendant was the tenant and operator of the Legacy Property. The Legacy Defendant is novI a holdover tenant. 8. David Ross II, LLC, a California limited liability company, is the owner of the Rose Property/Facility (the "Rose landlord" ). 9, Arlene I-I. Rosales, as Trustee of The Arlene H, Rosales Living Trust dated February 2, 2012, is the owner of the Legacy Property/Facility, (the "Legacy landlord" ). 10. 10 The Rose PropertyFacility was leased to the Rose Defendant as a turnkey operation. The Rose Defendant took. over the Rose Facility's operations pursuant to a ten-year commercial lease agreement {the "Rose Lease" ), commencing on April 16, 2016. I am a signatory 12 to the Rose Lease. A true and correct copy of the Rose Lease is attached hereto as Exhibit 1. 13 Jacobs and Miriam Taub {"Taub") guaranteed the Rose Lease, as evidenced by the Guaranty in 14 Exhibit 1.1. 15 11. The Legacy Property was leased to the Legacy Defendant as a turnkey operation. 16 The Legacy Defendant took over the facility's operations pursuant to a ten-year commercial lease 17 agreement (the "Legacy Lease" ), commencing April 16, 2016. 18 Lease. A true and correct copy of the Legacy Lease is attached hereto as Exhibit 2, Jacobs and 19 Taub guaranteed the Legacy Lease, as evidenced by the Guaranty in Exhibit 2.1. 20 12, I am a signatory to the Legacy Pursuant to section 14 of the Guarantee for each of the leases, Defendant Jacobs 21 and Taub are jointly and severally liable for all obligations arising under both the Rose and Legacy 22 Leases and their respective Guarantees. 23 13. 24 Defendant. 25 14. Defendant Jacobs is the principal and manager of the Rose Defendant and Legacy In or about June 2019, Defendants became delinquent in the rent for the Rose 26 Property and the Legacy Property. Both the Rose Defendant and the Legacy Defendant defaulted 27 on the Rose Lease and Legacy Lease. 28 3 DECLARATION OF ARLENE H, ROSALES, AS TRUSTEE OF THE ARLENE H. ROSALES LIVING TRUST DATED FEBRUARY 2, 2012, AND AS PRESIDENT OI DAVID ROSS II, LLC IN SUPPORT OF APPLICATION FOR EX PARTE ORDER APPOINTING RECEIVER AND FOR ORDER TO SHOW CAUSE RE 1 2 3 15. Plaintiffs filed two actions for Unlawful Detainer, against the Rose Defendant and the Legacy Defendant, respectively, on or about September 12, 2019. 16. Shoitly before trial, the patties in both Unlawful Detainer matters entered into 4 Unlawful Detainer Stipulation and Judgments (the "UD Stipulation and Judgments" ), which were 5 lodged with the court on November 12, 2019. The UD Stipulation and Judgments were almost 6 identical and provided that Rose Defendant and Legacy Defendant shall pay Plaintiffs a series of 7 sums on a series of dates, and that, in the event of a default in any payment or obligation as 8 provided in the UD Stipulation and Judgments, Plaintiffs could enter judgment for possession, any 9 and all past due rent, holdover damages, costs and attorneys'ees associated with the action, and Defendants'1 10 any other relief the court may deem appropriate, upon 48 hours ex parte notice to counsel. 4i 12 17. As part of the UD Stipulation and Judgments, Defendants were to remain in full 13 0C/l fa compliance with timely payment of property taxes and any quality assurance fees ("QA Fees" ) due 14 and owing. (All nonexempt skilled nursing facilities are required to pay the QA Fees to the State 0 15 Department of Health Care Services.) The UD Stipulation and Judgments provided that the 16 Defendants'enancies would only be reinstated upon timely tender of all payments and 17 compliance with all other terms as provided in the UD Sl.ipulation and Judgments. U ~ 6 )." iS 18 19 20 21 22 23 24 18. A true and correct copy of the November 12, 2019 UD Stipulation and Judgment entered into by the Rose Landlord and Rose Defendant is attached here as Exhibit 3. 19. A true and correct copy of the November 12, 2019 UD Stipulation and Judgment entered into by the Legacy Landlord and Legacy Defendant is attached here as Exhibit 4, 20. Timely payments were made for the first and second payments; however, both tenants failed to tender the third payminit pursuant to the terms of the stipulations. 21. On January 22, 2020, the landlords filed Ex Parte Applications to Enforce the 25 Terms of the Stipulations anti on January 23, 2020, Judge Curtis A. I&in entered Judgment against 26 the Rose Defendant and Legacy Defendant in the Unlawful Detainer matters in favor of Plaintiffs. 27 22. A true and correct copy of the Judgment against the Rose Defendant is attached DECLARATION OF ARI,ENE H, ROSALES, AS TRUSTEE OF TI-IE ARLENE H. 1&OSALES LIVING TRUST DATED FEBRUARY 2, 2012, AND AS PRESIDENT OF DAVID ROSS II, LLC IN SUPPORT OF APPLICATION FOR EX PARTE ORDER APPOINTING RECEIVER AND FOR ORDER TO SHOW CAUSE RE 1 here as Exhibit 5. 2 23. 3 here as Exhibit 6. 4 24. 5 6 A true and correct copy of the Judgment against the Legacy Defendant is attached The Plaintiffs also obtained a Writ of Possession to regain possession of both the Rose and Legacy facilities, 25. The Rose Lease and the Legacy Lease both contain provisions for the tenants to 7 turn over the Rose and Legacy facilities to the landlord in order to continue operations and 8 maintain continuity of operations for the residents. Specifically, the agreements both provide at 9 paragraph 5.5 that: 10 Upon termination of this Lease, Landlord shall have the sole, complete, unilateral, absolute 11 and unfettered right to cause the Facility's licenses to be reissued in Landlord's name or in 12 the name of the Landlord's designee upon application therefor to the applicable state 13 licensing authority and to further have the right to have any and all Medicare, Medi-Cal 14 and any other provider and/or third party payor agreements issued in Landlord's name or 15 in the name of Landlord's designee. In the event landlord exercises its rights pursuant to 16 ibis seciion 5.6 (sic), Tenant shall cooperate with Landlord in transferring the 17 al'orementioned items to Landlord's name or lor the benefit of Landlord or as Landlord 18 may direct, together with all patient records, and such other books and records relating to 19 the Facility's operations as Landlord or its designee may require to operate the [Rosej 20 Facility as a 95-bed skilled nursing facility [and the Legacy Facility as a 54-bed skilled 21 nursing facility], subject to indemnification for the use of such license, certification and 22 related provider agreements during such transition period. 23 26. On Friday January 31, 2020, some employees fiom the facilities told me they had 24 not been paid since the most recent payroll was due more than a week ago on Friday, January 24, 25 2020, which alarmed me. Some employees have left already because they did not get paid. 26 27 27. I intend to seek to keep the two facilities operating in order to maintain ihe residents and not require them io be moved. Based on my years of operating SNFs and my 28 5 DECLARATION OP ARLENE H. ROSAI.ES, AS TRUSTEE OP THE ARLENE H. ROSALES LIVING TRUST DATED FEBRUARY 2, 2IH 2, AND AS PRESIDENT OF DAVID ROSS 0, LLC IN SUPPORT OP APPLICATION FOR EX PARTE ORDER APPOINTING RECEIVER AND FOR ORDER TO SHOW CAUSE RE medical background, I know the chaos and uncertainty that would be caused to the residents by an abrupt and unexpected closure is extremely dangerous for them, 28. the facility The residents include the elderly, disabled and infirmed, some of whom have called 'home'nd have been here at least 10 years. Many of the residents in subacute care have a tracheotomy and require oxygen and respiratory treatment. If continuity of care is not maintained, not just the subacute care residents, but all of the residents at Legacy and Rose are likely to suffer imminent trauma. Abrupt and involuntary transfer of the residents from the premises to another facility (if one can be found) would run the risk of causing profound damage to them. 10 29. In addition to being the Landlord and Agent for the Landlord at these two 11 properties, I am also a nurse and operated these facilities in the past. I have extensive knowledge 12 regarding what is necessary to operate the facilities on these two properties, as well as what is 13 necessary to ensure that the patients remain safe and healthy while they are at these facilities 14 When the Rose Defendant and Legacy Defendant began operations in 2016, it was the first time in 15 roughly 30 years that the facilities on the Rose Property and Legacy Property were not being run 16 either directly by me or through family. 17 30. At the time the Ex Parte Applications were filed in the underlying Unlawful 18 Detainer matters, I submitted evidence, via declaration, that I was afraid for the health and safety 19 of the residents at both the Rose and Legacy skilled nursing facilities. My concerns have only 20 increased. I iun also afraid that the two current Rose Defendant and Legacy Defendant are in 21 imminent danger of insolvency/or bankruptcy and that the property in question, as well as 22 Plaintiffs'roperty rights, are in danger of being materially injured. My concerns are based, in 23 part, on the financial condition of the Rose Defendant and Legacy Defendant and Mr. Jacobs'4 actions as Manager of the Rose Defendant and Legacy Defendant, discussed below. 25 26 27 31. Furthermore, under the terms of the respective Leases and the Guarantees, Defendants were required to furnish certain financial and other reports, including statements of QA Fees owed for the facilities, upon request of the Landlord. By signing the leases and 28 6 DECLARATION OF ARLENE H. ROSALES, AS TRUSTEE OF TI-IE ARLENE H. ROSALES LIVING TRUST DATED FEBRUARY 2, 2012, AND AS PRESIDENT OF DAVID ROSS 11, LLC IN SUPPORT OF APPLICATION FOR EX PARTE ORDER APPOINTING RECEIVER AND FOR ORDER TO Sl-IOW CAUSE ICE 1 guarantees, Defendants also made assurances that any financial reports and other information 2 provided would be accurate and complete in all respects, 32. 4 they have failed and refused to provide them as requested and required under the leases. 33, 0 bankruptcy are based in part on the following facts: (a) the Legacy Defendant, Rose Defendant, 7 and Jacobs defaulted under the leases for failure to pay rent, which resulted in the need to pursue 8 Unlawful Detainer actions; (b) the Legacy Defendant, Rose Defendant, and Jacobs defaulted under 9 the UD Stipulation and Judgments for failure to ntake payments thereunder, which resulted in the 10 need for Plaintiffs to pursue ex parte entry of the Unlawful Detainer Judgments, which were 11 promptly entered in favor of Plaintiffs, (c) January 24, 2020, Jacobs, the Legacy Defendant, and 12 the Rose Defendant failed to pay the v'age obligations for employees at the Rose Facility and 13 Legacy Facility; (d) Jacobs has failed to provide financial statements every time I have ever 14 requested in contravention of his reporting requirements under the leases; and (e) on at least three 15 occasions in the past, checks made to me by the Rose Defendant or the Legacy Defendant have 16 bounced. CJ C/3 ~) 8 j In siummar, my fears and concerns of the imminent danger of insolvency and/or 6 ",—, 0);', While I have requested that Defendants provide those financial and other reports, 17 Current Status of Facilities 18 34. I have worked very hard and succeeded in obtaining a prospective new operator for 19 both facilities. The ncw prospective operator has executed a letter of intent, is competent, and is 20 ready to step in immediately. 21 22 23 35. To date, no prospective operators have contacted me purporting to have been referred by Mr. Jacobs. 36. Defendant Jacobs is not cooperating with the contemplated transition to the new 24 prospective operator and has refused to turn over operations and provider agreements as he is 25 required to do under the Rose Lease, Legacy Lease, Guarantees, UD Stipulation and.ludgments. 26 27 37. If Jacobs, the Legacy Defendant, and Rose Defendant do not immediately tuim over operations and enter into a Management and Operations Transfer Agreement in order to permit 28 7 DECLARATION OF ARLENE H. ROSALES,. AS TRUSTFE OF THE ARLENE H. ROSALES LIVING TRUST DATED FEBRUARY 2, 2012, AND AS PRESIDENT OF DAVID ROSS 0, LLC IN SUPPORT OF APPLICATION FOR EX PAINE ORDER APPOINTING RECEIVER AND FOR ORDER TO SHOW CAUSE RE 1 Plaintiffs or Plaintiffs'ominee to operate the Rose Facility and Legacy Facility under the Rose 2 Defendant's and Legacy Defendant's skilled nursing facility licenses and bill for services under 3 the Rose Defendant's and Legacy Defendant's provider agreements until such time as Plaintiffs or 4 Plaintiffs'ominee are able to secure the same in their own name, then nobody will be permitted 5 to take over operations upon dispossession of the Legacy Defendant and Rose Defendant and the 6 residents would thereupon be involuntarily forced to leave, 7 8 38. Based upon my knov'ledge of running skilled nursing facilities, and these facilities more specifically, as well as discussions and my observations as noted herein, I fear that: If a receiver is rot appointed now, the operations at the facilities are lilcely to be understaffed and lacking in supplies and resident services due to the 10 non-payment of employees; 12 If a receiver is not appointed now, residents are likely to suffer imminent 13 trauma as a result of the abrupt and involuntary transfer of the residents 14 from the premises to another facility when the Defendants are dispossessed 15 in accordaiice with the Unlawful Detainer Judgments (instead of the 16 peaceful transfer of operations, as is required by the leases); 17 If the receiver is not appointed now, the residents'ealth and security will 18 be in jeopardy:, 19 If the receiver is not appointed now, the California Department of Public 20 Health will take action to shutter thc facilities immediately upon the 21 dispossession of the Legacy Defendants and Rose Defendants; 22 e. If the receiver is not appointed now, Plaintiffs will suffer irreparable injury 23 because Defendants are liable to cause waste to the Rose Facility and 24 Legacy Facility through their imminent insolvency and potentially driving 25 away the prospective new operator that Plaintiffs have secured; 26 If the receiver is not appointed now, Plaintiffs will suffer irreparable harm 27 because Defendants are not paying rent or their employees yet refuse to turn 28 DECLARATION OF ARLENE FL ROSALES, AS TRUSTEE OF Tl-IE ARLENE I-I. ROSALES LIVING TRUST DATED FEBRUARY 2, 2012, AND AS PRESIDENT OF DAVID ROSS II, LI.C IN SUPPORT OF APPLICATION FOR EX PARTE ORDER APPOINTING RECEIVER AND FOR ORDER TO SI-IOW CAUSE RE Date: February 3, 2020 Rosaies Living Trust dated February 2, 2012; and as Presiclent of David Ross II, LLC I-f. 10 .=" ]2 13 14 16 17 18 20 TRUS'I'ATED o Dl:.CLARATION OF ARLENE H. ROSALES, AS TIBlSTEE OF TIIE AIILENI"; H. ROSALES LIVINO I EDRUARY 2, 2012, AND AS PRISE)ENT OF DAVID ROSS Il, I I C IN SUPPORT OF APPLICATION FOR. EX PARTE ORE)FR APPOENTINO RECEIVER AND FO)EI ORDER TO SHOW CAUSE RI:. Exhibit 1 AGRKEMKNT OF LEASE This Agreement of Lease (the "Lease" ) is executed in duplicate as of this 16'" day of April, 2016, by and between DAVID ROSS II, LLC, a California limited liability company (the "Landlord" ) and ROSE GARDEN SUBACUTE k REHABILITATION CENTER, LLC a California limited liability company (" Tenant" ). RECITALS A, Landlord is the owner of the land, buildings and improvements thereon and the furniture, fixtures and equipment that contains the operations of that certain ninety-five (95) bed skilled nursing facility, twenty-one (21) of such beds being licensed subacute beds, as defined in California IIealth and Safety Code $ 1250(c), licensed by the California Department of Public Health ("CDPH"), Medicare and Medi-Cal certified, and commonly known as "Rose Garden Convalescent Center" located at 1899 North Raymond Avemie, Pasadena, California 91103 (the "Facility" and collectively the "Leased Premises" ) and as more fully described in the legal description attached hereto as KxntntT A and incorporated herein by this reference. B. The Facility is currently leased and licensed to David Ross, Inc., a California corporation (" Prior Tenant" ), pursuant to a lease dated January I, 2014 (the "Prior Lease" ) which Prior Lease shall terminate upon the Commencement Date (hereinafter defined) pursuant to the terms of the Lease Termination attached hereto as Kxtuiitm 8, Landlord desires to lease the Facility to Tenant, and Tenant desires to lease the Facility from Landlord according to the following terms and conditions. C. AGRKKMKNT 1. General Undertalcinu. That for and in consideration of the rental hereinafter reserved and of the mutual covenants, agreements and conditions hereinafter contained, Landlord does hereby lease, let and demise unto Tenant, and Tenant does hereby take, accept and rent from Landlord, those certain premises as described on KxtttatT A hereto situated in the County of Los Angeles, State of California, commonly known as Rose Garden Convalescenl. Center, 1899 Norlh Raymond Avenue, Pasadena, California 91103, together with all of Landlord's right, title and interest, if any, in and to all machinery, trade equipment, trade Bxtures, furniture, furnishings, beds, and accessories of all kinds used in connection with the Facility, including all personal property (an inventory of which is attached hereto as Schedule 1,1), whether tangible or intangible; and all rights, if any, to apply for licensure and operate the Facility as a licensed nursing facility in the State of California and all rights, if any., to apply for Medi-Cal and Medicare certification of the beds (collectively the "Leased Assets" ). The Leased Assets shall not include any of Tenant' personal property which is not essential to operation of the Facility or which is not a replacement ol'any of the Leased Assets. 1,1 2. Renresentations and Warranties. 2.1 Landlord Renresentations and Warranties. Landlord variants and represents to Tenant that it is the owner (a) of the Leased Premises, and that it is duly authorized and empowered to make and enter into this Lease with Tenant. Landlord represents and warrants that, as of the Commencement (b) Date and after the satisfaction of the condition precedent contained in Section 3.2(a} of this Lease, there are no other tenants to the Leased Premises or any other person who has a right to possession of the Leased Premises, Landlord represents and warrants that Landlord has no notice, (c) written or oral, that the Leased Premises are in violation of any applicable rulings, zoning, parl&ing requirements or other laws or ordinances. Landlord represents and warrants that the Facility is licensed by (d) CDPH as a ninety-five (95) bed skilled nursing facility, and that the Facility is certified for participation in the Medicare and Medi-Cal programs and has active and valid provider agreements. Landlord represents and warrants that there is no litigation pending (e) or threatened against the Leased Premises, Landlord or Prior Tenant. Other than as set forth on Schedule 2.1(fl, neither the Leased (f) Premises, nor the property of either Landlord or Prior Tenant are encumbered by any liens of mechanics, laborers, or materialmen, chattel mortgages, the Internal Revenue Service, any Governmental Authority (defined belov ) or any other liens, All liens set forth on Schedule 2,1(fl shall be released prior to the Commencement Date and Tenant shall have no liability for any such lien not so released prior to the Commenceinent Date or otherwise. "Governmental Authority" shall mean OSIIPD, or any court, board, age!icy, arbitrator, commission, office or other authority of any nature whatsoever for any governmental unit (foreign, federal, state, county, district, municipal, city or otherwise) whether now or hereafter in existence having jurisdiction over the Leased Premises. Landlord represents and warrants that there are no room size waivers (g) in place at the Facility as of the Comniencement Date. Except as set forth in Schedule 2.1(h) hereto, Landlord represents and warrants that all physical plant repairs, replacenients and maintenance have been completed in accordance with applicable law and, if required, with OSPHD approval. (h) 2.2 Tenant Renresentations and Warranties. Tenant is a limited liability company, duly formed and validly existing and in good standing under the laws of the State of California, and has the limited liability company power and authority to own its property and assets and to carry on its business as now being conducted or as will be conducted oii and after the Commencement Date. (a) The execution, delivery and performance of this Lease by Tenant (b) will not, as of the Commencement Date, conflict with or result in a breach of or default under any of the terms, conditions or provisions of Tenam's articles of organization, or operating agreement, This Lease constitutes the valid and binding obligation of Tenant, fully enforceable in accordance with its tertns. (c) As of the Commencement Date, there is no suit, claim, action or legal, administrative, arbitration, or other proceeding or governmental investigation pending or threatened, by or against Tenant. (d) 3. Term of Lease, 3.1 The Term of the Lease (or "Lease Term" ) provided for herein is ten and years, shall commence on the Commencement Date and terminate on the tenth (10") (10) anniversary thereof, unless sooner terminated by Landlord or as otherwise provided in this Lease or by law. 3.2 Tenant shall have tv o (2) options (each, a "Renewal Option" ), to extend this Lease for an additional period of five (5) years each (each, an "Extension Term" ), provided Tenant is not in default, with all rights of cure expired or impossible, under this Lease at such time as it exercises such Renewal Option. Renewal Option for each Extension Term shall be exercised by Tenant, giving written notice (an "Option Notice" ) to Landlord not less than six (6) months nor more than twelve (12) months prior to the expiration of the then current term of this Lease. Each Renewal Option shall be exercised by Tenant by delivery of an Option Notice to Landlord stating that Tenant is exercising the Renewal Option. If Tenant fails to give such Option Notice in writing to Landlord within the time period specified herein, all rights and privileges granted to Tenant to extend this Lease shall lapse and become null and void. No later option may be exercised if Tenant. fails to exercise a prior option. Fixed Rent due in the first Lease Year of the Extension Term and each subsequent Lease Year during the Extension Term thereafter shall be calculated pursuant to the terms and provisions of Section 4.1(b), 'ach 3,3 4. The Coimnencement Date shall be April 16, 2016. Rental Pavmenls; I&ev Monev, 4.1 For each and every month of the Lease Term, Tenant agrees to pay as Rent for the Leased Premises, the following sums, on the first day of each month, as follows, Any Monthly Rent (hereinafter defined) received by Landlord, after notice by Landlord to Tenant that such Monthly Rent payment has not been received, on the seventh (7'") day or later of the month when due shall be considered late and subject to a,five percent (5%) penalty due at the time of payment. As of the Commencement Date and until April 30, 2017, Tenant shall pay $ 600 per month per bed (the "Rent" or "Monthly Rent" ). Payment for the first month's rent shall be prorated based on the number of days the Tenant leases the Leased Premises hereunder. (a) On October 16, 2016, Tenant shall pay the last month's rent due (b) under this Lease in the amount of fifty seven thousand dollars {$ 57,000.00), which Landlord shall accept as payment in full of the last month's rent, despite iuay rent increases which may occur during the Term of the Lease. Commencing May 1,2017, and on each May I annually thereafter (c) during the Lease Term including the Extettsion Term('s), the then current Monthly Rent shall be increased by three percent {3%) pcr year. 4.2 If and so often as the number of licensed beds increases or decreases during the term of this Lease, effective as of the date of each such increase or decrease, then current Monthly Rent (as the same may have previously increased under this Lease, whether as a result of any prior increase in licensed beds or otherivise) shall be increased or decreased according to the increase or decrease in licensed beds. The increases in Monthly Rent contemplated by this Section 4.2 shall be in addition to and not in lieu of the 3'z'G annual rent increases. 4.3 Tenant hereby agrees that if Tenant fails to pay Rent or any other sum required to be paid by Tenant hereunder within the seven-day grace period for any (2) iwo consecutive months, or for any three (3) nionths during a Lease Year, Rent hereunder for the remaining Lease Term shall be automatically adjusted to be quarterly rental, payable in advance, commencing on the first (1") day of the month following such consecutive late month, or the third (3'") late month in a Lease Year quarter, and continuing thereafter for the remaining Lease Term on a quarterly basis in advance. 4,4 Dov E. Jacobs and Miriam Taub v:ill personally guarantee the payment of Rent, all triple net charges, and all other obligations under the Lease. As approved as to form and content by the Landlord and appears as KxtttutT C, attached hereto. Tenant shall be solely responsible for all general and special real estate taxes and assessments (together with any excise taxes on such real estate taxes and assessments levied or imposed by any governmental taxing authority), fire district taxes, liens, impositions, including capital stocl&, franchise, ad valorem, sales, use, bed taxes; personal property taxes, assessments including assessments for public improvements or benefits, whether or not commenced or completed prior to the date hereof and whether or not to be completed within the Term; ground rents; water, sewer and other utility levies and charges; excise iax levies; fees including license, permit, inspection, authorization and similar fees; and all other governmental charges, in each case whether general or special, ordinary or extraordinary, or foreseen or unforeseen, of every character in respect of the Leased Premises, and all interest and penalties thereon attributable to any failure in payment by Tenant which at any time prior to, during or in respect of the Term hereof may be assessed or imposed on or in respect of or bc a lien upon the Leased Premises (collectively, the "Imnosil.ions") that accrue from the Commencement Date through the Term. 4.5 Tenant agrees io furnish to Landlord within thirty (30) days after the written request of Landlord, official receipts of the appropriate taxing authority or other proof of satisfactory to Landlord evidencing the payment thereof. 4.6 4.7 All taxes or assessments payable by Tenant pursuant to the terms and provisions of this section shall be prorated as of the last real property tax year(s) of the Lease Term. After the Commencement Date Tenant shall pay all taxes or assessments as they become due. 4.8 Tenant shall have the absolute right to appeal any Impositions of any Governmental Authority through a tax certiorari or other lawful appeal process at Tenant' expense, 4.9 Landlord shall not be required to join in any such proceeding unless it shall be necessary for it to do so in order to properly prosecute such proceeding. 4,10 All rental and other payments shall be made to Landlord at the address designated by Landlord, which may be changed by Landlord upon written notice to Tenant, at any time. 4.11 The terms "rent," "rental" "Additional Rent" and "monthly rent" as used in this Lease shall be deemed to mean all minimum Monthly Rent, rental adjustments, Impositions and any and all other sums, however designated, required to be paid by Tenant hereunder, whether payable to Landlord or third parties. 4.12 Any taxes or impositions which may have been prepaid by Landlord shall be prorated between Landlord and Tenant within thirty (30) days of the Coirunencement Date. 4.13 Tenant shall pay in full: (a} prior in each case to the date when penalties would attach, all Impositions, except ottiy those so long as and to the extent that the same shall be contested in good faith by appropriate and tiniely proceedings and for which adequate reserves have been established in accordance with practices consistent with the skilled nursing facility industry, provided that (i) no default of this Lease has occurred and remains uncured, beyond all applicable cure periods, (ii) such proceeding shall suspend the collection of such Impositions or the Impositions shall have been paid, (iii) siich proceeding shall be permitted under and be conducted in accordance with the provisions of any other instrument to which Tenant is subject and shall not constitute a default thereunder, (iv) no part of or interest in the Leased Premises shall be in danger of being sold, forfeited, temiinated, canceled or lost, (v) Tenant shall have furnished such security as may be required in the proceedhig, to insure the payment of any such Impositions, and (vi) Tenant shall promptly upon final detertnination thereof pay the amount of such Impositions, together with all costs, interest and penalties; (b} all of Tenant's wage obligations to Tenant's employees in compliance vdth the Fair Labor Standards Act (29 U.S.C. Ijtj 206-207) or any comparable provisions; and (c) all obligations validly owed in connection with any claim, demand or notice of any overpayment received from Medicare, Medi-Cal or other third party ptiyoi'. 4.14 Tenant shall have ihe right, but not the obligation, to offset the amount of any Offset Obligation (as defined below) of Landlord and/or Prior Tenant against amounts otherwise due pursuant to Landlord under this Lease (" Right of Offset" ). An "Offset Obligation" shall mean: (i) (for the entire term of the lease including renewals) any tax obligation of Landlord, Arlene H. Rosales, an individual, or any affiliate thereof (other than Tenant's obligations to pay taxes and Impositions pursuant to this lease); and (ii) (for the first twelve (12) months of the Lease) any obligations of David Ross, Inc,, a California corporation or other prior operators of the Facility for any overpayment, recoupment or takeback bv any Governmental Authority or third party payor as related to dates of service prior to the Commencement Date, Should Tenant receive notice of an Offset Obligation, Tenant shall provide notice to Landlord of such Offset Obligation and Landlord shall have seven (7) calmidar days to provide Tenant with proof of payment of such Offset Obligation. Should Landlord fail to provide adequate proof of payment of such Offset Obligation then within seven (7) calendar days, Tenant may exercise its Right of Offset and may offset as much as the entire amount of the next month's rent. Should the amount of the Offset Obligation exceed the total amount of rent owed to Landlord for the next month's rent, the Right of Offset shall continue indefinitely for future rent payments until the entire Offset Obligation has been satisfied and paid in full. Tenant's Right of Offset shall not be Tenant's exclusive remedy by which to seek indemnification under this Lease or the MOTA, nor shall such Right of Offset be considered a waiver of any other remedy available to Tenant pursuant to applicable law, If Tenant shall exercise this Right ol'Offset, Tenant shall not be precluded from making claims for payment pursuant to this Lease or the MOTA. Tenant may exercise the Right of Offset to offset the entire amount of each monthly payment due to Landlord and/or any other payments due to Landlord. The filing of any voluntaiy or involuntary petition for bankruptcy or any other insolvency proceeding by Landlord and or Prior Tenant shall not affect the enforceability of the Rights of Offset. On October 16, 2016, Tenant shall pay to Landlord a security deposit in the amount of Fifty-Seven Thousand Dollars ($ 57,000) (the "Security Deposit" ). If Tenant is in default beyond all applicable cure periods.,Landlord can use the Security Deposit or any portion thereof to cure the default or to compensate Landlord for all damages sustained by Landlord resulting fiom Tenant's default. Tenant shall immediately, on demand, pay to Landlord a sum equal to the portion of the Security Deposit expended or applied by Landlord as provided for in this paragraph so that it maintains the Security Deposit in the sum initially deposited with Landlord. If Tenant is not in default beyond all applicable cure periods at ihe expiration or termination of this Lease, Landlord shall return the Security Deposit to Tenant, within ten (10) days of the termination of this Lease. 4.15 4.16 In consideration of the Landlord's grant of this Lease and the extended business opportunity to be afforded the Tenant as a result thereol; Tenant agrees to pay Landlord the principal sum of Three Hundred Seventy-Five Thousand and 00/100 Dollars ($ 375,000.00) (the "Kev Monev"), over and above the Rent. Such Key Money shall be paid to Landlord upon the execution of this Lease. 5. Use and Control of Premises. 5.1 The Leased Premises may be used by Tenant for the purpose of operating a skilled nursing facility (a "SNF'*) or nursing home in accordance with the current licenses and certifications therefor, and for related ancL'or additional ptuposes, whether necessary or incidental to such uses, including, but not limited to, the addition of services under the current license, and/or additional licensure. 5.2 Tenant covenants and agrees that it will not use the Leased Premises, nor permit the Leased Premises to be used, in whole or in part, for any purpose or use in material violation of any of the law, ordinances, regulalions or niles of any public authority at any time applicable thereto. Tenant shall neither use nor permit to be used the Premises or the Facility, or other improvements or any part thereof for any purpose or purposes other than as a 95-bed SNF, with the current bed configuration, and for no other purpose whatsoever, without the express written consent of Landlord first having been obtained. In no event may Tenant change the existing "classification" of beds to a lov:er classification (e,g., reclassify skilled nursing beds to intermediate care beds), change the existing classification of beds to a higher classification, or increase or decrease the number of'beds in the Facility, without Landlord's prior written consent, which consent may not be unreasonably withheld, conditioned or delayed. 5,3 Tenant shall, at its own cost, and without expense to Landlord, keep and maintain the Premises, and every part thereof, including, but not limited to, the roof, exterior, interior, foundation, structural parts, operational parts, paving, landscaping, sidewalks, buildings, surface parking lots, sewers, utility lines, and other improvements of any kind which may be a part thereof, in very good, sanitary and neat order, condition and repair, and free fiom hazards, including replacements as needed, and shall keep the interior in an upgraded condition, at Tenant' sole cost and expense, and except as specifically provided herein, restore and rehabilitate any improvements of any kind which may be destroyed or damaged by fire, casualty or any cause whatsoever, in such a manner as may be necessaiy to operate the Facility in accordance with applicable state and federal laws and regulations, Tenant shall also maintain the grounds in a good and sightly appearance, including regular ntowing, pruning, fertilizing, and other appropriate care of all grass, plants, and trees. Tenant shall promptly replace dead plants and shall maintain the extent of landscaping at least to the level as exists on. the Commencement Date. Landlord shall not. be obligated to mal&e or bear the cost of any repairs, replacements or renewals of any kind, nature or description whatsoever to the Premises, the Facility, or other improvements thereon. Tenant expressly waives the benefit of any law, v'hether by statute, judicial decision, ordinance, or otherwise, now or hereafter in effect, tliat would otherwise accord Tenant the right to make repairs at Landlord's expense or to terminate this Lease because of Landlord's failure to keep the Premises or any portion thereof in good order, condition, or repair. If any Mortgage Holder requires deposits of maintenance costs to be made with such Mortgage Holder, Tenant shall either pay to Landlord monthly the amounts required and Landlord shall transfer such iuuounts to each Mortgage I-lolder, or, pursuant to written direction by Landlord, Tenant shall make such deposits directly with such Mortgage Holder. Tenant shall also be solely responsible for making all changes required during the life safety surveys and any other required repairs as stated by OSHPD. Such repairs shall be made in compliance with OSHPD requirements and Tenant shall, when obligated by OSHPD requirements, obtain OSHPD approval for all such repairs. Landlord shall be permitted, once per calendar year, to inspect the Leased Premises with regard to upkeep and repairs. Landlord will prepare an itemized list of items it wishes Tenant to repair, update and/or replace (the "Proposed Repairs" ) and Landlord and Tenant shall meet and confer regarding such repairs and will reasonably worl& to agree on which Proposed Repairs will be performed by Tenant. Tenant shall have the right diuing the Term, without the consent of I.andlord, to make such non-structural interior alterations, changes and improvements to the Leased Premises as may be proper and necessary for the conduct ol'Tenant's business, to cause the Leased Premises to conform to all Lav s, for patient eomfott and safety, or for the full beneficial 5.4 use of the Leased Premises, so long as such iinprovements, (i) do not interfere with any of the purposes for which the Facility was leased, (ii) do not decrease the value of the Leased Premises, or (iii) such non-structural alterations can be removed at the end of the term of the Lease at Landlord's request and at Tenant's cost, without material damage to the Leased Premises. Tenant shall pay for all costs, fines and penalties imposed by the applicable state agencies or Center for Medicare and Medi-Cal Services ("CiMS") or other Govermnental Authority in connection with any change of ownership survey which are not related to issues beginning and/or arising prior to the Commencement Date, Tenant shall notify Landlord of any alterations, changes or improvements required by any Governmental Authority prior to the commencetnent thereof. Tenant shall give Landlord written notice ten (10) days prior to commencing repairs, construction, or alterations whose costs exceed Tv enty-Five Thousand Dollars ($ 25,000.00) to allow Landlord to post notices of non-responsibility. 5.5 Tenant agrees to return to Landlord upon the expiration of this Lease, the Leased Premises and Leased Assets. Landlord and Tenant acknowledge that the Leased Premises, was, and at all times under the terms of this Lease are, the sole and absolute property of Landlord, Upon any termination of this Lease, Landlord shall have the sole, complete, unilateral, absolute and unfettered right to cause the Facility's licenses to be reissued in Landlord's name or in the name of Landlord's designee upon application therefor to the applicable state licensing authority and to further have the right to have any and all Medicare, Medi-Cal and any other provider and/or third party payor agreements issued in Landlord*s name or in the name of Landlord's designee. In tlie event Landlord exercises its ri.ghts pursuant to this Section 5,6, Tenant shall cooperate with Landlord in transferring the aforementioned items to Landlord's name or for the benefit of Landlord or as Landlord may direct, together with all patient records, and such other books and records relating to the I'acility's operations as Landlord or its designee may require to operate the Facility as a 95-bed skilled nursing facility, subject to indemnification for the use of such license, certification and related provider agreements during such transition period. Tenant shall use its best efforts to maintain the number of beds at the Facility and to maintain the room size waivers in place at the I acility on the Commencement Date and shall notify Landlord if Tenant receives any notice that such room size waivers are being revoked or denied, but in the event CDPH denies any room size waivers and reduces the number of beds Tenant shall not be held in default of this Lease. 5.6 All improvements and additions made by Tenant to the Leased Premises which are permanently affixed to the building located thereon shall be deemed to be a part of the building and Leased Premises, and immediately become the property of Landlord 6. Materials and Hazardous iVaste. 6.1 Tenant shall not place or hold any Hazardous Materials on or at the Leased Premises, except as is necessary for the ordinary course of its business as a SNF. If Tenant' business requires the use of any Hazardous Materials, other than such materials as are typically found in skilled nursing facilities, Tenant sliall notify Landlord in writing and shall comply with hazard communication and notification requirements of the Occupational Safety and Health Act ("OSHA") and all laws which require notification of employees, the community or any govermnental agency of the hazardous properties of such IIazardous Materials. 6.2 Tenant shall not place, hold or dispose of any I-Iazardous Waste on, under or at the Leased Premises except as specifically allowed in this Section 6.2. Tenant further agrees that it shall not use the Leased Premises as a treatment, storage, or disposal (whether permanent or temporary) facility for Hazardous Waste except in the ordinary course of operating the Facility and in compliance with all Environmental Laws. If 1enant, in the ordinary course of its business as a SNF generates I-Iazardous Waste, then Tenant shall comply with all applicable federal, state and local laws, statutes, ordinances, codes, rt:Ies, regulations, orders or decrees relating to the appropriate use, storage, transportation and disposal of Hazardous Waste. For the purposes of this Lease, "I-Iazardous Waste" means and includes any hazardous material that has entered the waste stream or any contaminant or pollutant as defined as such in the Resource Conservation and Recovery Act, the CERCLA, as amended, any so-called "Superfund" or "Superlien" law, the TSCA, or any other Law, relating to or imposing liability or standards of conduct concerning, any hazardous, toxic or dangerous waste. Tenant shall have no liability for any such losses, liabilities, damages, injuries, costs, expenses or claims asserted or arising under the CERCLA, as amended, any so-called "Superfund" or "Superlien" law, or any other Law, relating to or imposing liability or standards of conduct concerning, any Hazardous Material, condition, omission or which arise due to any violation of Environmental Law pre-dating ihe Commencement Date. Tenant further agrees that it shall properly dispose of all "infectious waste" such as laboratory waste, pathological waste, blood specimens or products, patient or resident waste, including, without limitation, bandages and disposable gowns, sharp waste and any material generated by the production or testing of biological agents. Immediately upon receipt of any Environmental Notice (as hereinafter defined) from any Person, Tenant shall deliver to Landlord a true, correct and complete copy of same. "Environmental Notice" shall mean any note, notice, or report of any suit, proceeding, investigation, order, consent order, injunction, writ, award, or action related to or affecting or indicating the treatment, storage, handling, disposal, generation, spill, release or discharge of any Hazardous Waste or Hazardous Materials in or affecting the Leased Premises. Upon the expiration of the Term, or the earlier termination thereof, whichever shall be the first to occur, Tenant sltall forthwith remove all Hazardous Materials and Hazardous Waste caused, placed or released on, at or under the Leased Premises or any portion thereof in accordance with applicable Law (excluding consumable supplies typically used in the operation of a skilled nursing facility). Landlord shall have the right to inspect the Leased Premises with regard to the management and disposal of Hazardous Materials and Hazardous Waste at all reasonable times during the Term. 6,3 7. Utilities. Tenant agrees to pay, or cause to be paid, all charges against the Leased Premises for gas, water, sewer, electricity, light, heat or power, telephone and all other utilities used, rendered or supplied upon or in connection with the Leased Premises through the Lease Term commencing with the date Tenant enters into possession, and to indemnify Landlord and to save them harmless against any liability or dainages on such account. 7.1 8. Insurance. 8.1 At all times during this Lease, at its own cost and expense, Tenant shall all improvements and Invcntoiy existing or hereinafter erected or added as a keep buildings, part of the Leased Premises, including all alterations, rebuilding, replacements and additions thereto, insured against loss or damages by fire, and such other hazards, casualties, risks and contingencies that may hereafter be considered as included within the standard form fire insurance policy with extended coverage endorsement, in an amount equal to one hundred percent (100%) of the full replacement value thereof. The carriers of all policies shall have a Best's Rating of "A-" or better. All said policies of insurance shall be written on an occurrence or claims-made form. Tenant shall not be permitted to provide self-insurance and all such insurance must be obtained fi'om a third party insurer, 8,2 The term "full replacement value" shall mean actual replacement cost exclusive of cost of excavation, foundations and footings. At all times during this Lease, at its own cost and expense, Tenant shall provide and keep in force single limit comprehensive general liability insurance policies, in standard form, protecting Landlord and Tenant against any and all liability in an amount of not less than One Million Dollars ($ 1,.000,000.00) per occurrence and Three Million Dollars ($ 3,000,000,00) in the aggregate, Tenant shall also maintain workers'ompensation insurance meeting all statutory and regulatory limits. If either party shall at any time believe the limits of insurance required hereunder to be excessive or insufficient, the parties shall endeavor to agree in writing on the proper reasonable limits for such insurance and such insurance shall thereafter be carried with the limits as agreed on until further changed pursuant to the provisions of this Section. If the parties shall be unable to agree thereon, the proper reasonable limits for such insurance to be carried shall be determined as described in Section 8.4. 8,3 8.4 If Landlord and Tenant cannot agree on the terms of insurance provided for hereunder, Landlord and Tenant shall each select an insurance brol&er. If they cannot agree on the proper reasonable limits for such insurance, then they in turn shall select an impartial third broker who shall determine the reasonable limits of insurance coverage. Such third party shall, in rendering its decision, bear in mind the insutunce market conditions, availability of insurance and premium costs for such coverage for the long term care industry in the State of California and what is reasonably and commercially available for the Tenant. All such policies shall cover the entire Leased Premises, including parking and coimnon areas therein, and sidewalks adj acent thereto. All such insurance to be provided by Tenant under this section shall name as an additional insured the Landlord and/or I.andlord's Mortgage Holder (except and Tenant as their respective interests may appear, and Tenant shall provide certificates of all such insurance to Landlord. In addition, all policies of insurance of the kind described in Section 8.1 shall provide for payment of loss to (i) the Landlord and the Tenant as their interests may appear, in the case of any particular casualty resulting in damage or destruction to the Leased Premises exceeding $ 150,000.00, and (ii) Tenant in the case of any such particular casualty resulting in damage or destruction not exceeding $ 150,000.00. 8.5 workers'ompensation) 8.6 All net insurance proceeds received by or on account of Landlord, the Tenant or the beneficiary, if any, or any deed of trust on the Leased Premises, as the case may be, under the policies of insurance of the kind described in Section 8.1 shall be held in trust by the 10 recipient thereof, who shall adntittister and apply such proceeds in accordance with the provisions of Section 11 hereof. 8.7 All of the policies of insurance provided for in this Lease shall be in form and substance as is then standard in the State of California for policies of like coverage and shall be distributed in such amount, and by such responsible companies as Landlord shall reasonably approve. 8.8 In the event that Tenant fails to obtain and maintain insurance as in this Lease provided, Landlord may effect any such insurance coverage and pay premiums therefore, and all premiums so paid by Landlord shall be payable by Tenant to Landlord, 8,9 The obligation of collecting upon the insurance policies furnished and for provided by Tenant, or obtained by Landlord by reason of the failure of Tenant to obtain thetn, shall be Tenant', but Landlord shall cooperate in such collection (but at the expense of Tenant if any expense is incurred) to such reasonable degree as may be requested by Tenant, 9. Mechanic's Lien. Tenant shall not suffer or permit any mechanic's liens to be filed against the Leased Premises or any part thereof by reason of work, labor, services, or material supplied or claimed to have been supplied by Tenant or anyone holding the Leased Premises, or any part thereof, through or under Tenant. If any such mechanic's lien should at any time be filed against the Leased Premises, Tenant shall cause the same to be discharged of record within thirty (30) days after the date of filing the same. If Tenant shall fail to discharge such mechanic's lien within such period, then Landlord may, but shall not be obligated to, discharge the same either by paying the amount claimed to be due or by procuring the discharge of such lien by deposit in court or by giving security, or in such other manner as is or may be prescribed by law. Any amount paid by Landlord for any of the aforesaid purposes in procuring the discharge of such lien, with all necessary disbursements in connection therewith, shall be repaid by Tenant to Landlord on demand, and if unpaid, may be treated as Additional Rent. Nothing herein contained shall imply any consent or agreement on the part of Landlord to subject Landlord's estate to liability under any mechanic's lien law. 9.1 9.2 If the Tenant shall desire to contest any claim or lien, it shall furnish the Landlord adequate security of the value or in the amount of the claim, plus estimated costs and interests, or a bond of a responsible corporate siuety authorized to do business in the State of California, in such amount, conditioned on the discharge of the lien. Il' final judgment establishing the validity or existence of a lien for any amount is entered, the Tenant shall pay and satisfy the same at once, 10. Indemnilication/Offsets, 10.1 Tenant agrees to ntdemnify, defend iuid save harmless Landlord and its inembers, managers, officers, directors, owners, employees, representatives and agents against and from any and all claims which arise as a result of the Tenant's actions, inactions, negligence or conduct and that arises during the Lease Term, that is brought by and on behalf of any person, arising I'rom the conduct or management of or from any work or thing whatsoever 11 done in or about the Leased Premises by or on behalf of Tenant, and will further indemnify, defend and save Landlord and its members, managers, of?cers, directors, owners, employees, representatives and agents harmless against and from any and all claims by or on behalf of any person arising during the Lease Term which relates to events or acts which occurred during the Lease Term "by Tenant from any condition of the building on the Leased Premises or any sidewalk adjoining the Leased Premises, or any passageways or spaces therein or appurtenant thereto, or arising from any breach or default on the part of Tenant in the performance of any covenant or agreement of Tenant to be performed pursuant to the terms of this Lease, or arising from any act of negligence of Tenant, or of any of its agents, contractors, servants, employees, sub-tenants, or licensees, or arising from any accident, injury, or damage whatsoever caused to any person occurring after the Commencement Date of this Lease in or about the Leased Premises, or upon or under the sidewalks and the land adjacent thereto, and from and against all costs, counsel fees, expenses and liabilities incurred in or about any such claim or action or proceeding brought against Landlord and its trustees, representatives and agents by reason of any such claim, Tenant upon notice from Landlord covenants to resist or defend such action or proceeding. This indemnity shall not extend to injury caused by Landlord, its agents, representatives or employees. 10.2 Landlord and Landlord?s principal, Arlene Rosales, agree to indemnify, defend and save harmless Tenant and its members, managers, officers, directors, owners, employees, representatives and agents against and from any and all claims which arise as a result of Landlord?s actions, inactions, negligence or conduct and that arises during the Lease Term, that is brought by and on behalf of any person, arising from the conduct or management of or from any work or thing whatsoever done in or about the Leased Premises by or on behalf of Landlord, and will further indemnify, defend and save Tenant and its members, managers, of?cers, directors, owners, employees, representatives and agents harmless against?and from any and all claims by or on behalf of any person arising during the Lease Term which relates to the Offset Obligations and any events or acts which occurred prior to the Lease Term by Landlord or any tenant of Landlord, including, but not limited to Prior Tenant, from any condition of the building on the Leased Premises or any sidewalk adjoining the Leased Premises, or any passageways or spaces therein or appurtenant thereto, or arising from any breach or default on the part of Landlord in the performance of any covenant or agreement of Landlord to be performed pursuant to the terms of this Lease, or arising from any act of negligence of Landlord, or of any of its agents, contractors, servants, employees, sub-tenants, or licensees, or arising from any accident, injury, or damage whatsoever caused to any person occurring prior to the Commencement Date of this Lease in or about the Leased Premises, or upon or under the sidewalks and the land adjacent thereto, and from and against all costs, counsel fees, expenses and liabilities incurred in or about any such claim or action or proceeding brought against Tenant and its trustees, representatives and agents by reason of any such claim, and Landlord, upon notice from Tenant, covenants to resist or defend such action or proceeding. This indemnity shall not extend to injury caused by Tenant, its agents, representatives or employees or to any Quality Assurance Fees (the Fees?) imposed on Prior Tenant, which Tenant is otherwise assuming, or to any liability assumed by Tenant for the ProClean agreement. For purposes of this Article 10 the term ?person? shall mean any natural person, corporation, limited liability company, professional association, limited partnership, general partnership, joint stock company, joint venture, association, company, trust, bank, trust company, 12 land trust, business trust or other organization, whether or not a legal entity, and/or any Governmental Authority. 11, Damaue or Destruction. 11.1 If during the Lease Term the buildings or improvements on, in or appurtenant to the Leased Premises, or thereafter erected, installed or placed thereon or therein, shall be destroyed or datnaged in whole or in part by fire or other hazard, risk, contingency or casualty, whether or not covered by insurance pursuant to Section g.l hereol; or after partial condenmation not resulting in terinination of tins Lease, Tenant shall give to Landlord inunediate notice thereof, and Tenant shall promptly repair, replace and rebuild the satne, at least to the extent of the value, quality and class equal to the building improvements existing immediately prior to such occurrence (hereinafter referred to as "Restoration" ), all in accordance with Section 13,1 hereof, provided Tenant has access to the insurance coverage provided herein. Notwithstanding anything herein to the contrary, in the event that the damage or the destruct,ion is a result of a casualty not covered by insurance, Tenant shall have the obligation to repair or restore the Leased Premises. If such destruction or injury reduces by fifty percent (50%), or more, the number of licensed and certified beds as licensed on the Commencement Date, then upon written notice by one party to the other, either Landlord or Tenant may terminate this Lease, unless such damage or destruction was caused by Tenant's negligent or willful malfeasance (in which event, Tenant shall be obligated to repair or construct the Leased Premises), Tenant shall be released from any fat%her liability hereunder thereafter accruing with respect to the Facility, except as otherwise expressly provided in this Lease. If Tenant shall not so terminate this Lease, then Tenant shall repair or reconstruct the Leased Premises in substantially the same condition as just prior to the incident and consistent will all applicable Laws in effect at the tiine of the repair or reconstruction, and with the proceeds of the property casualty insurance carried by Tenant as required heremider, and Landlord shall make such insurance proceeds available to Tenant for such purpose, All such repairs and reconstruction shall be undertaken and completed in accordance with applicable Law. In the event of any damage or destruction as hereinabove referred to, any insurance money received by or paid to the Landlord, Tenant or beneficiary, if any, of any deed of trust on Ihe Leased Premises by reason thereof shall be applied to such costs of repairing, restoration, or rebuilding as herein provided for and required pursuant to Section 13.1 hereof, unless this Lease is terminated as provided herein. To the extent that any insurance proceeds are in excess of the cost of repair or restoration, Landlord shall be entitled to retain such excess insurance proceeds. 11,2 12. Condemnation. 12.1 If title to the fee of the whole of the Leased Premises shall be taken or condemned by any competent authority for any public or quasi-public use, this Lease shall cease and terminate as of the date of vesting of title in said authority. If title to the fee of less than the whole of the Leased Premises, but more than fifty percent (50%) of the licensed bed capacity of the Leased Premises shall be so taken or condemned, Tenant shall have the option by written notice to Landlord to terminate this Lease as of the date of vesting of title in said authority to the portion of the Leased Premises so taken or condemned. Upon the exercise of 13 such option, this Lease shall cease and terminate as to such poriion. In either of such events, all annual rental shall be apportioned as of the date the Lease shall have been so terminated as aforesaid. 12.2 The total condemnation award made with respect to any such taking shall be apportioned between the Landlord and Tenant in accordance with their respective interests in the Leased Premises immediately prior to such condemnation or taking. Including but not limited to Tenant's right to any compensation from the condenming authority for diminution in value of the leasehold, loss or damage io Tenant's personal property, Tenant's loss of business during the remaining Lease Term, Tenant's removal and relocation expenses or the depopulation expenses incurred by Tenant na connection with transferring the residents to other SNFs. 12.3 If litle to the fee of less than fifty percent (50%) of the licensed bed capacity of the Leased Premises shall be so taken or condemned, or if Tenant shall be so entitled, but shall not elect to terminate this Lease as provided for in Section 12.1 hereof, Tenant shall restore the undertaken portion of any building or improvements on the Leased Premises so that such building shall constitute a complete architeciural unit of the same general character and condition (as nearly as may be possible under ihe circumstances) as the building and improvements existing immediately prior to such condenmation or taking. For the purpose of contributing to the cost of such restoration worl&, Landlord upon receipt of the award made in such condenmation proceeding, shall, out of such award, inake paynnent to Tenant in accordance wiih the provisions of Section 13 hereof, From and after the date of the last of such payments by Landlord to Tenant, the annual rent payable by Tenant hereunder shall be reduced by an iunount which bears the same ratio to such annual rental as the amount of the entire award, including compensation, damages, and interest, if any, made with respect to the portion of the Leased Premises so taken or condemned (including any severance damages), bears to the value of the Leased Premises immediately prior to the taking or condemnation, as such value is determined in said condemnation proceedings. 13. Restoration. The terms and conditions upon which any buildings or other improvements on the Leased Prenaises shall be restored as aforesaid by Tenant, and the terms and conditions upon which the net proceeds of insurance ol'he kind described in Section 8.1, as well as the net award in condemnation described in Section 12.3, which are held in trust by the recipient thereof as hereinbefore provided, shall be applied to the cost of such restoration, are as follows: 13.1 Tenant shall submit to Landlord complete plans and specifications (a) in compliance with the then existing licensing requirements, which shall be designated: (I) if restoration is occasioned by fire or other casualty (except partial condemnation), to restore the building at least to its condition immediately prior to such damage or destruction and as nearly as similar in character as is practicable and reasonable; if the restoration is occasioned by partial condemnation, to (2) construct the remainder of the building so that the building shall constitute a complete architectural unit of the same general character and condition (as nearly as may be possible under the circumstances) as the building existing immediately prior to such commendation or taking. The plans and specifications shall be subject to the approval of Landlord and approval shall not be unreasonably withheld. within fifteen (15) calendar days after submission thereof, Landlord shall either approve the same or seive written notice upon Tenant of its disapproval thereof and its objections thereto, in default of which such plans and specifications or such portion thereof not objected to shall be deemed to be approved by Landlord, anything herein contained to the contrary notwithstanding. (b) Tenant shall obtain consent of Landlord prior to commencing any work under this Section 13.1. ol'nsurance Tenant shall thereafter furnish the recipient of the proceeds (c) or the award in condemnation, as the case may be, with a copy of any contract or contracts which Tenant shall enter into for the making of such restoration; or, if the restoration is to be done by Tenant, a copy of all subcontracts made by Tenant in connection with such restoration, and an estimate of the cost thereof, During the progress of the restoration, the holder of the insurance (d) proceeds or award in condenuiation, as the case may be, shall make payments to Tenant or to the contractors and materialmen of Tenant, for the account of Tenant, out of such proceeds of insurance or award in condemnation to the extent available, At the completion of the restoration and following the (e) disbursement of the final advance to Tenant required to complete the payment of restoration costs, any such insurance proceeds or condemnation award proceeds remaining shall be paid by the recipient thereof to Landlord and credited to the rental required to be paid by Tenant pursuant hereto during the year in which such payment is made. Landlord shall have the right, at its sole option and expense, to inspect or audit the records of Tenant relating to the restoration. During such restoration, Landlord and any architect, engineer, or (fl other representative designated by Landlord, may inspect the building in the course of such restoration. Tenant shall keep copies of all plans, shop drawings and specifications relating to such restoration on the building site and permit Landlord or its architect, engineer, or other representative to examine them at all reasonable times, or in the alternative, shall furnish Landlord with copies of such plans, drawings and specifications. In the event that during the restoration of the building, Landlord or its architect, engineer or other representative shall reasonably determine that the materials do not substantially conform to the approved specifications or that the building is not being restored in accordance with the approved plans, or that prior certificates from Tenant v"ere in error, prompt notice in writing shall be given to Tenant, specifying in detail the particular deficiency, omission or other respect in which it is claimed that the restoration does not conform with the plans and specifications as so approved. Upon receipt of any such notice, Tenant shall take such steps as it deems necessary 15 to cause corrections to be made as to any deficiencies, omissions or otherwise, and if necessary for the purpose of effectuating such corrections, shall immediately remove such materials and replace such construction and furnish materials in accordance with materials equally as good as those provided for in such plans and specifications. If Tenant shall fail to commence such restoration within ninety (g) (90) days of such damage or destruction, or having commenced such restoration shall fail to complete it in accordance with the provisions of this Lease with reasonable diligence, Landlord may, at its option and upon serving written notice upon Tenant that it elects to do so, make and complete such restoration. In such event, Landlord shall have the right, as the restoration progresses, to use and apply the insurance proceeds or condemnation award money to the cost of such restoration to the extent that it shall not theretofore have been applied to the payment or reimbursement of costs and expenses of Tenant as aforesaid, If prior to the completion of such restoration whether by Landlord or Tenant, this Lease shall terminate or expire for any reason, Landlord shall have the right to receive and retain such insurance proceeds or condemnation award, to the extent that it shall not theretofore have been applied to the payment or reimbursement of the costs and expenses of Tenant and Landlord, as aforesaid and Tenant shall thereupon be discharged from any and all obligations under this Lease, with respect to such restoration. 14. Landloi'd's Entrv Rivhts. Subject to Landlord's compliance with all applicable laws, rules and regulations relating to protecting the patient's privacy, Tenant shall permit Landlord and the authorized representatives of Landlord to enter the Leased Premises at all reasonable times for the purpose of determining whether the Premises are in good condition and whether Tenant is complying with its obligations under this lease; serving, posting or Iceeping posted thereon notices provided by any law of the State of California or which may be reasonably necessary or appropriate for the protection of Landlord or its interest, for the purpose of inspecting same; to post "for rent" or "for lease" signs during the last six (6) months of the term, or during any period while Lessee is in default; to show the Premises to prospective brokers, agents, buyers, Tenants, or persons interested in an exchange, at any time during the term; and for the purpose of making any necessaty repairs to the Leased Premises and performing any work that may be necessary to comply with the laws, ordinances, rules, regulations or requirements of any public authority or any applicable standards that may from time to be time be established by the National Board of Fire Underwriters, the National Fire Protection Association, or any similar bodies, or that Landlord may deem necessary to prevent waste, loss, damage or deterioration to or in connection with the Leased Premises. 14.1 14.2 Landlord shall not in any event be liable for inconvenience, annoyance, disturbance, loss of business or other daniage of Tenant by reason of making repairs or the performance of any work in the Leased Prenaises, or on account of bringing materials, supplies and equipment into or through the Leased Premises during the course thereof, and the obligations and responsibilities of Tenant under this Lease shall not thereby be affected in any maimer whatsoever. Landlord shall, howev r, in connection with the doing of any such work, cause as little inconvenience, annoyance, disturbance, loss of business or damage to Tenant ancl its subtenants as may be reasonable possible under the circumstances. 14.3 Upon notice to Tenant and in coordination with Tenant, Landlord shall have and is hereby given the right to enter the Leased Premises at all reasonable times for the purpose of exhibiting the same to prospective purchasers or encumbrancers. 15. B ankruntcv and I nsolvencv. 15.1 If at any time during this Lease, Tenant shall voluntarily file a petition in Bankruptcy or insolvency, or shall file a voluntary petition for reorganization under the bankruptcy laws of the United States or under any insolvency act of any state, or shall take advantage of any insolvency act by voluntary petition or assignment for the benefit of creditors, other than by permitted merger, consolidation, or reorganization not connected with insolvency or bankruptcy, then and in any such event, Landlord may at its option, serve a written thirty (30) day notice of cancellation and termination ot this Lease, and upon the expiration of said thirty (30) days, this Lease shall end and expire by limitation as fully and completely as if the date of expiration or such thirty (30) day period were the day herein definitely fixed for the end and expiration of this Lease, If Tenant shall be placed in involuntary batiluuptcy proceedings, or if a receiver, trustee, assignee or other sirriilar custodian of Tenant's property shall be appointed, and (b) if the rental payable hereunder shall remain unpaid for a period of thirty (30) days 15.2 (a) after the event described in subsection (a) above, then and in such event, Landlord may at its option serve a written thirty (30) day notice of cancellation and termination upon Tenant and upon the expiration of said thirty (30) days, this Lease, as well as all right, title and interest of Tenant hereunder, shall end and expire as fully and completely as of the date of expiration of such thirty (30) day period; provided, however, that the Tenant, or such receiver, trustee, assignee or custodian may during said thirty {30) day period, pay to Landlord such delinquent rent and said thirty (30) day period shall once again commence to run as of the date of payment of such delinquent rent and this Lease shall not expire. Tenant and Landlord agree this is not an executory contract and Tenant shall have no right to reject this Lease in any banlcruptcy or insolvency proceeding. For purposes of tlus Section 15 only, the reference to "receiver" shall not include a receiver of rents, issues and profits in an action brought to foreclose a mortgage on such leasehold estate. 15.3 15.4 Tenant shall be responsible for all of Landlord's reasonable attorney fees and expenses incurred as a result of Tenant's insolvency or bankruptcy proceedings. 16. Defaults. In the event that during the Lease Term'. (i) Tenant shall default in the payment of any installment of rent or other sums herein specified to be paid by Tenant, such default shall continue for fifteen (15) days after the due date thereof and such default shall not be cured within thirty (30) days after Landlord shall have given to Tenant written notice spccil'ying such default or defaults;.or (ii) Tenant shall default in the observance or performance 16.1 of any of Tenant's covenants, agreements or obligations hereunder and such default shall not be cured within thirty (30) days after Landlord shall have given to Tenant written notice specifying such default or defaults; or {iii) in the case of default which cannot be cured within a period of thirty (30) days after receipt of written notice, Tenant shall not have begun proceedings to cure the same, reasonably satisfactory to Landlord, and shall not prosecute the curing of such default as rapidly as reasonably required by Landlord under the circumstances: Then in any such event Landlord shall have the right, at its election at any time, while such defaults continue, to reenter and take complete and peaceable possession of the Leased Premises, and to either keep this Lease in effect or to declare the Lease Term ended, whereupon this Lease and all the right, title and interest of Tenant hereunder shall terminate and be of no further force and effect. In the event that Landlord shall elect to so terminate this Lease, then Lancllord may recover fiom Tenant: (a) the worth at the time of award of any unpaid rent or other (1) charges which had been earned at the time of such termination; plus the worth at the time of award of the amount by which the (2) unpaid rent and other charges v hich would have been earned after termination until the time of award exceeds the amount of such rental loss Tenant proves could have been reasonably avoided; plus the worth at the time of award of the amount by which the (3) unpaid rent and other charges for th- balance of the Lease Term after the time of award exceeds the amount of such rental loss that Tenant proves could reasonably be avoided; any other amount necessary to compensate Landlord for {4) all the detriment proximately caused by Tenant's failure to perform its obligation under this Lease or which in the ordinary course of things would be likely to result therefrom including attorneys fees and costs: and at Landlorcl's election, such other amounts in addition to or (5) in lieu of the foregoing as may be permitted &om time to time by applicable law. As used in subsections {I) and {2) above, the "worth at the time of award" is computed by allowing interest at the Wells Fargo Banlc Prime Rate plus two percent, but in no event greater than ten percent (10%). As used in subsection (3) above, the "worth ai. the time of award" is computed by discounting such amount at the discount rate of the I'ederal Reserve Bank of Los Angeles at the time of award plus one percent (I '/o). The amount recoverable by Landlord pursuant to Subsection (4) above shall include, but is noi limited to, any costs or expenses incurred by Landlord in maintaining or preserving the Premises after such default, preparing said Premises for reletting to a new tenant, accomplishing any repairs or alterations to the Premises for the purpose of such reletting, rectifying any damage thereto occasioned by the act or omission of Tenant, and any other costs reasonably necessary or appropriate to relet the Premises. Landlord shall ftrrfher have the right, without declaring this Lease (b) ended, to reenter the Leased Premises and occupy or Lease the whole or any part thereof for and on account of the Tenant, and upon such terms and conditions and for such rent as the Landlord may deem proper, and to collect said rent or any other rent that may thereafter become payable, and apply the same toward the amount due or thereafter to come due from the Tenant, and on account of the expense of such subletting and any other damages sustained by Landlord. Should such rental collected by Landlord be less than the rental payable by Tenant hereunder, the Tenant agrees to pay such deficiency to the Landlord and to pay to the Landlord forthwith upon any such reletting, with such deficiency the costs and expenses which Landlord may incur by reason thereof. By way of clarification, Landlord and Tenant agree that Landlord has the remedy described in California Civil Code Section 1951.4 (Landlord may continue the Lease in effect after Tenant's breach and abandoninent and recover rent as it becomes due, if Tenant has the right to sublet or assign, subject only to reasonable limitations). Landlord shall have the right, even though it may have relet the Leased Premises, to thereafter elect to terminate this Lease and all of the right of the Tenant in or to the Leased Premises, 16.2 The following shall also be considered events of default by the Tenant and Tenant shall have the right to cure the event of default as specified and in general after receipt of written notice from the Landlord except as specified: if the leasehold interest of Tenant shall be levied upon under (a) execution or be liened or attached and such levy, lien or attachment is not removed within thirty (30) days ol'he date Tenant receives notice of it; in the event of a filing by or against. Tenant of a petition under federal or state law pertaining to bankruptcy or insolvency or for a reorganization or other relief, unless, in the case of a petition filed against Tenant, the same is dismissed within thh@ (30) days; (b) if Tenant is adjudicated as bankrupt or a court of competent (c) jurisdiction shall enter an order or decree appointing, v ith or without the consent of Tenant, a receiver of Tenant or of the whole or substantially all of its property and is uncured within thirty (30) days; if Tenant makes any general assignment for the benefit of creditors (d) and is uncured within thirty (30) days; (e) if Tenant abandons the Facility comprising the Leased Premises or if, except as a result of damage, destruction or a partial or complete condemnation, Tenant voluntarily ceases operations of the Facility comprising the Leased Premises, or il'Tenant files with any Governmental Authority, or othervvise adopts a closure plan for the Facility or relinquishes its slcilled nursing facility license and Medicare or Medi-Cal provider agreements; if Tenant receives a state or federal notice of termination of license (fl or "fast track" de-certification and such notice has not been suspended, extended, withdrawn or terminated within the time period required by any Goveriunental Authority; (g) if any of the representations or warranties made by Tenant under this Lease or otherwise proves to be untrue when made in any material respect and is uncured within thirty (30) days of the date Tenant receives notice of it; 19 16.3 If Tenant shall default in the performance of any covenants required to be performed by and under this Lease, Landlord may perform the same for the account and at the expense of Tenant in accordance with the provisions of this Lease, If Landlord at any time is compelled to pay any sum of money or do any act which will require the payment of any sum of money by reason of the failure of fenant to comply with any provisions of this Lease, or if Landlord is compelled to incur any expense, including reasonable attorneys'ees, in instituting; prosecuting or defending any action or proceeding instituted by reason of any default of Tenant hereunder, the sum or sums so paid by Landlord shall be due fiom Tenant to Landlord immediately upon demand of Landlord. In addition to the aforesaid remedies, Landlord shall have all other remedies provided by law. The Landlord shall rot be deemed to have terminated this Lease or the liability of the Tenant to pay rent thereafter to accrue, or its liability for damages under any of the provisions hereof by any such reentry, or by any action in an unlawful detainer or otherwise obtain possession of the Leased Premises, unless the Landlord shall have notified the Tenant in writing that they have so elected to terminate this Lease and the tenancy of the Tenant hereunder. Tenant further covenants that the service by the Landlord ol'ny notice pursuant to the unlawful detainer statutes of the State of California and the surrender of possession pursuant to such notice shall not (unless the Landlord elects to the contrary at the time of or at any time subsequent to the service of such notice and such election can be evidenced by a written notice to the Tenant) be deemed to be a termination of this Lease. In the event of any entry or taking possession of the Leased Premises as aforesaid, the Landlord shall have the right, but not the obligation, to remove therefiom all or any part of the Tenant's personal property located therein, and may place the same in storage at a public warehouse at the expense and risk of the owner or owners thereof. 16.4 16.5 The remedies given to the Landlord in this Section 16 shall be in addition and supplemental to all other rights and remedies which the Landlord may have under the laws then in I'orce. 16.6 The Landlord shall be in default of this Lease if the Prior Tenant and Landlord's previous tenant (as well as an affiliate of Landlord) of the Lease Premises causes unreimbursed damages to the Tenant resulting from (i) any repayments or recoupments required by any Governmental Authority or third party payor for dates prior to this Lease, (ii) any losses incurred as a result of the resurvey by the California Department of Idealth due at the Facility, or (iii) Prior Tenant's failure to timely file and support the cost reports (for dates prior to this Lease) with the appropriate Medicare and Medi-Cal agencies which are required to be filed by law under the terms of the Medicare and Medi-Cal programs and required to be filed and supported by that certain Management and Operations Transfer Agreenient dated as of even date herewith between Tenant and Prior Tenant. Tenant shall provide written noiice to Landlord of such Landlord's default and Landlord shall have thirty (30) days to cure. If Landlord fails to cure this default within thirty (30) days Tenant may elect to either (i) exercise its Right of Offset against rent payments due, any losses incurred under this Section 16.6,, or (ii) terminate this Lease with thiriy (30) day written notice to Landlord during which thirty (30) day termination period Landlord shall continue to have the right to cure this default, 20 16.7 Landlord's Default. A breach by Landlord of any of its obligations arising under this Lease shall be an Event of Default hereunder, which, if not cured within thirty (30) days of Tenant's notice of such default to Landlord shall give Tenant the right to terminate the Lease. For the avoidance of doubt, a default by Licensee under Section 3.4 of the Management and Operations Transfer Agreement of even date herev:ith shall not constitute a default of Landlord under this Lease. 17. Surrender Unon Termination, Tenant shall, upon the termination of the Lease Term, or any earlier termination of this Lease, surrender to Landlord, the Leased Premises in good condition and repair, reasonable wear and tear excepted, 17.1 17.2 Upon the expiration or termination of this Lease, the following provisions shall apply: To the extent not then prohibited by applicable law, unless otherwise (a) directed by Landlord, Tenant shall use reasonable good faith efforts to and for no fee (i) assign to Landlord or Landlord's nominee (or to cooperate with Landlord or Landlord's nominee in connection with the processing by Landlord or Landlord's nominee of any applications) for all Healthcare Licenses, as defined below, ther. in effect v:hich relate to the operation of the Leased Premises and entei into an interim sublease agreement and interim management agreement or a management and operations transfer agreement (collectively the "MOTA"), which MOTA shall be in form and substance as approved by Landlord and Tenant, in order to permit Landlord or its nominee to operate the Leased Premises under Tenant's Healthcare Licenses and bill for services, until such time as Landlord or its nonmiee are able to secure the same in their own name, and(or cooperate with Landlord or its nominee in their efforts to secure Healthcare Licenses for which Landlord or its nominee wishes to apply and which may be required by Landlord or Landlord's nominee relating to the ownership and operation of the Leased Premises. Provided, however, that the costs and expenses of any such transfer or the processing of any such application shall be paid by Landlord or Landlord's nominee), and (ii) file all final cost reports, if any, relating to Tenant' operation of the Leased Premises. "Healthcare Licenses" shall mean: all licenses and permits that are required for the Premises to operate as a licensed skilled nursing facility, by the local, state or federal agencies having jurisdiction over any aspect of ihe operation of the Leased Premises as a licensed skilled nursing facility, including but noi limited to: all permits (including building permits), the License and other licenses, certificates (including certificates of occupancy), certificates of need (if applicable), Medi-Cal and Medicare provider agreements and numbers, submitter identification numbers, Veteran's Administration contracts, and other third party payors, including managed care contracts, and all other govermnental approvals, ai!thorizations and entitleminits. Tenant acknowledges and agrees that to the extent and only to the (b) extent permitted by law, title to (i) any zoning or building approvals, or other governmental approvals other than the Healthcare Licenses (the "Approvals" ) which, by their nature, perlain to the Leased Premises, its ownership and its use and occupancy, and (ii) all licenses and permits other than the I-lealihcare Licenses which, by their nature, pertain specifically to the Leased Pretnises, its ownership and its use and occupancy shall, in every respect, be and remain with the Leased Premises or Landlord, as the case may be, and are not and shall not be the property of Tenant. Tenant shall take no action and shall have no right, power or authority to encumber same except in favor of Landlord and then only to the extent permitted by applicable law or to sell, assign or transfer same to any third person other than Landlord or its nominee in accordance with the provisions of this Lease, either during the Term or upon any termination of this Lease, or to use, in any manner which would impair or adversely affect the use of such Approvals with respect to the Leased Premises, such Approvals at any other location. Effective with the issuance of a SNF license by CDPH to Landlord (c) or Landlord's nominee, Tenant shall execute in favor of Landlord or Landlord's nominee, an assignment of resident agreements, to the extent and only to the extent permitted by law, and an assignment of contracts and operating leases. In addition, Tenant shall cooperate with Landlord in order to ensure a smooth transfer without interruption of the operation of the Leased Premises to Landlord or Landlord's nominee. Such cooperation shall include, without limitation, access to or transfer of (i) all records and other information with respect to residents and patients of the Leased Premises which are in the possession of Tenant or any affiliate of Tenant (subject to applicable legal requirements governing confidentiality of patient records). At the request of Landlord or its nominee, Tenant shall enter into a (d) Management and Operations Transfer Agreement (a "MOTA") with the successor operator of the Leased Premises in form and substance acceptable to Landlord and Tenant and as lawful and customary in the industry at the time of the transfer, The MOTA shall define responsibility and liability for matters related to the conunuing operation of the Leased Premises arising prior to the date operations of the Leased Premises are transferred from Tenant, any sub-tenant, or any manager (as applicable) to the successor operator of the Leased Premises (herein the "Operations Transfer Date" ) and for matters related to operations of the Leased Premises arising on or after the Operations Transfer Date. The MOTA shall address (as of the Operations Transfer Date) the proration of monthly residency fees; periodic fees due under continuing service contracts; use of the Healthcare Licenses, billing and coordinadon of accoun1s receivables; utility charges and deposits; employee salaries, wages and other employment benefits for Leased Premises employees. The MOTA shall provide for indemnification of Tenant by Landlord and any successor operator of the Leased Premises for liabilities related to the transfer of Healthcare Licenses and operations of the Leased Premises from and after the Operations Transfer Date. Notwithstanding the above, and for the avoidance of doubt, the MOTA shall follow the general guidelines and procedures as provided for the MOTA entered into as of the Commencement Date, provided however that the final form and content of the MOTA shall be subject to review and approval by Landlord and Tenanb Tenan1 aclcnowledges and agrees that at the expiration or (e) termination of the Lease, Tenant shall have paid all fees (including but not limited to quality assurance fees owing to the California Department of Health Care Services and any fees owing to the California Office of State Wide Health Platuung and Development or any successor agencies or similar programs in effect at the 1ime of 1he termination of the Lease), penalties slid taxes of any kind, incurred during or attributable to the 1ime periods of Tenant's operation of the Leased Premises. Tenant further acknowledges and agrees to indemnify, protect, defend, and hold harmless Landlord and its respective members, managers, directors, officers, employees, agents successors and assigns from any and all demands, claims, causes of action, fines, penalties, damages, losses, liabilities (including strict liability), judgments, and expenses (including reasonable attorneys'ees and other professionals'ees and court costs) incurred in connection with or arising from the Tenant's occupancy or operation of the Leased Premises for all periods prior to the expiration or termination of the Lease Terni, for any failure by Tenant to pay any liabilities in connection with the Leased Premises, including but not limited to, any liabilities to any third paly payor(s), including overpayments, or recovery audits, or investigations of any kind which are attributable to the periods during Tenant's occupancy or operation of the Leased Premises. 17,3 Notwithstanding anything herein to the contrary, nothing shall require Tenant to complete the necessary applications for or on behalf of Landlord or Landlord's nominees, except with the Tenant's portion of the application as "Seller" thereimder. 18. I-Iold Over. 18.1 In the event that Tenant shall hold the Leased Premises after the expiration of any Lease Term hereof with the consent of Landlord, express or implied, such holding over shall, in the absence of written agreement on the subject, be deemed to have created a tenancy from month-to-month terminable on thirty (30) days'otice by either party to the other, at a monthly rental equal to the monthly rental payable during the last year of said term, plus fifty percent (50%), and otherwise subject to all the terms and provisions of this Lease. 19. Quiet Eniovment. 19.1 Landlord covenants that the Tenant, on paying the rent reserved and on performing all the terms, covenants and conditions liereof on the part of Tenant to be performed, and not being in default under any of the terms of this Lease, shall at all times during the Lease Term, peacefully and quietly have, hold and enjoy the Leased Premises. 20. Action on this Contract. 20.1 Should either pai".y hereto institute any action or proceeding in court to enforce any provision hereof or for damages by reason of an alleged breach of any provision of this Lease, the prevailing party shall be entitled to receive from the other such amount as thc court may adjudge to be reasonable attorneys'ees for the services rendered to it in such action or proceeding in addition to all reasonable costs. 21. Notices, 21.1 All notices to be given by either party to this Agreement to the other party hereto shall'be in writing, and shall be (a) given in person, (b) deposited in the United States mail, certified or registered, postage prepaid, return receipt requested, or (c) sent by national overnight courier service with confirmed receipt, each addressed as follows: If to New Operator: Rose Garden Subacute k Rehabilitation Center, LLC Attn: Dov Jacobs 11600 W, Washington 13oulevard Los Angeles, CA 90066 With copies to: (which shall not constitute notice) Sanders Rehaste Sternshein & Harvey, LLP Attn: Jennifer M. Sternshein, Esq. 5316 E, Chapman Avenue Orange, CA 92869 Telephone; (714) 289-7070 Facsintile: (714) 289-7071 E-mail:Jennifer~a)srshhealthlaw,corn If to Landlord: David Ross II, LLC c/o Arlene Rosales 1307 Dana Place Fullerton, CA 92831 With copies to; (which shall not constitute notice) Siteman Law Group Atui: Karen B, Siteman 433 N. Camden Dr,, 4'" Floor Beverly Hills, CA 90210 Telephone: (310) 279-5249 I'acsimile: (310) 279-5248 E-mail:kbsiteman sitemanlawgroup.corn 21.2 Either pat+ may, from time to time, designate a different place by written notice. Notices, demands, consents or requests served in the manner hereinabove described shall be deemed sufficiently served or given at the time of personal deliver or three (3) days after mailing thereof. 22. Renortinn Obliaations. Tenant shall. upon request by Landlord, furnish Landlord a complete and accurate copy of the annual Medicare and Medi-Cal cost report for Tenant, current statements of Quality Assurance fees owed for the Facility, quaiterly financial statements of the Tenant, and/or copies of the Tax Returns as filed annually, Updated financial information on the Guarantor, annually. Tenant shall provide, reasonably promptly after receipt or filing of same, the 2567 any and all Intents to Cite or Citations from any entity governmental or otherwise. 22.1 22.2 Tenant shall fully cooperate with Landlord and/or Landlord's lender with respect to financing of Landlord and respond to any request for information, including, but not limited to financial, licensing, regulatory and physical plant issues and shall provide an estoppel certificate, or other similar document upon request. 22.3 Tenant may not voluntarily discharge residents from the Facility outside the course ordinary of business so as to cause a material adverse effect on the Facility census, 24 23. Internretation. 23.1 The words "Landlord'* and "Tenant", wherever used herein, shall be applicable to one or more persons, as the case may be, and the singular shall include the plural, and the neuter shall include the masculine and feminine, and if there be more than one, the obligations hereof shall be joint and several. The word "persons" wherever used, shall include individuals, firms, associations and corporations. 23.2 Both Landlord and Tenant have been represented by counsel and this Lease has been freely and fairly negotiated. Consequently, all provisions of this Lease shall be interpreted according to their fair meaning and shall not be strictly construed against any party. 24. Assiunment. 24.1 In the event that Landlord shall voluntarily or involuntarily, or by operation of law, transfer or convey their interest in the Leased Premises then the Landlord shall automatically be freed and relieved from all personal liability as respects the performance of any covenant or obligations on the part of Landlord contained in this Lease thereafter to be performed, so long as such successor, assignee or other transferee of Landlord shall assume and agree to be liable and responsible for same. It is further provided that any aiuount then due and payable to Tenant by Landlord under any provisions of this Lease shall be paid to Tenant, and Landlord shall not be released from any liability as respects performance of any covenants on the part of Landlord to be performed prior to such assignment or transfer. 24,2 Tenant shall not, without the prior written consent of Landlord, which may be provided or withheld in Landlord's absolute discretion, voluntarily or involuntarily assign, mortgage, encumber or hypothecate any interest in this Lease or sublet all or any portion of the Premises (except for occupancy by patients or residents of the Facility and/or uses incidental thereto, such as a barber shop, etc.), 'Notwithstanding the foregoing, Tenant may, without Landlord's prior written consent, assign this Lease or sublet the Leased Premises or any portion thereof to a wholly owned subsidiary of Tenant if all of ihe following are first satisfied: (yi such subsidiaiy fully assumes Tenant's obligations hereunder; and (z) Landlord shall have received an executed counterpart of all documents for such assignment or lease. Ai all times during the Term of this Lease, Dov E. Jacobs shall maintain an ownership interest of at least fifty-one percent (51%i of the Tenant and Tenant's sole member and shall be the Manager of Tenant, 25. I&iuhts Cumulative, The various rights, options, elections, powers and remedies of the Landlord contained in this Lease relating to default on the part of Tenant shall be construed as cumulative, and no one of them exclusive of any others or of any other legal or equitable remedy which Landlord might otherwise have in the event of any breach or default in the terms hereof on the part of Landlord. The exercise of one right or remedy by Tenant shall not in any way impair its right to any other right or remedy until all obligations imposed upon I.andlord have been fully performed. 25.1 25.2 The various rights., options, elections, powers and remedies of the Tenant contained in this Lease relating to any default, breach of warranty or other breach on the part of Landlord, shall be construed as cumulative, and no one of them shall be deemed exclusive of any other or of any other legal or equitable remedy which Tenant might otherwise have in the event ol'ny breach or default in the terms hereof on the part of Landlord. The exercise of one right or remedy by Tenant shall not in any way intpair its right to any other right or remedy until all obligations imposed upon Landlord have been fully performed. 26. Bindina on Successors. Each of the parties hereto hereby agrees to each and all of the terms and conditions of this Lease, it being further agreed that each and all of the covenants and obligations of this Lease shall be binding upon and inure to the benefit of the parties hereto, as the case may require, and, except as herein otherwise specifically provided, as well, their respective heirs, executors, administrators, successors and assigns, subject at all times, nevertheless to all agreements and restrictions herein contained with respect to assignment, subletting, or hypothecation of Tenant's interest in this Lease. 26.1 26,2 Nothing contained in this Lease shall be deemed or construed by the parties hereto, or by any third person, to create the relationship of principal and agent or of partnership or of joint venture, or of any association between Landlord and Tenant, and no provision contained in this Lease, or any acts of the parties hereto, shall be deemed to create any relationship between Landlord and Tenant, other than the relationship of Landlord and Tenant. 27. Waiver of Riahts, 27,1 No waiver of any default of Tenant hereunder shall be deemed or construed by the parties hereto, or by any third person, to create the relationship ofprincipal and agent or of partnership or of joint venitue, or of any association between Landlord and Tenant, and no provision contained in this Lease, or any acts of the parties hereto, shall be deemed to create any relationship between Landlord and Tenant, other than the relationship of Landlord and Tenant. 28. Memorandtun of Lease. 28.1 The parties hereto agree, upon the demand of'ither party, to execute a Memorandum of Lease in a forts acceptable to both Landlord and Tenant, and aclcnowledge same so as to entitle it to be recorded. 28.2 Tenant shall execute and deliver to Landlord on the expiration or termination of ibis Lease, immediately on Landlord's request, a Termination of Memo of Lease, in recordable form, and a Termination of Lease. 29. Termination of Current Lease 29.1 The Current Lease by and between Landlord and Prior Tenant shall expire according to the terms ol'he Lease fermination as of the Commencement Date. There is no memorandum of lease recorded in the Los Angeles County Records, 30. Force Maieure. 30.1 Whenever Tenant shall be required by the terms of this Lease or by law to perform any contract, act, worlc, labor, or service, or to discharge any lien against the Leased Premises, or to perform and comply vith any laws, rules, orders, ordinances, regulations or zoning regulations, Tenant shall not be deetned to be in default herein and Landlord shall not enforce or exercise any of its rights under this Lease, if and so long as non-performance or default herein shall be directly caused by strikes not caused by Tenant's actions, non-availability of materials, war or national defense pre-emptions, governmental restrictions, acts of God, acts of Landlord, or other similar causes beyond the reasonable control of Tenant. However, notwithstanding any of the provisions of the foregoing, Tenant shall in any event pay any sum of money required to discharge any lien incuned by Tenant if at any time the Leased Premises, or any part thereof, shall be in danger of being foreclosed, forfeited or lost, and Tenant shall commence such performance and continue the same with diligence and continuity. 31. Govemina Law. 31,1 This Agreement shall be construed in accordance with, and its performance shall be governed by, the laws oi'he State of California. Any and all actions to enforce this Lease shall be conducted in the County of Los Angeles, California. 32. lntearated Aareement. 32,1 This Lease contains all the agreements of the parlies and cannot be amended or modified except by a written agreement signed by the parties. fSignorro'es on follotvingpagej 27 IN WITNESS WHEREOF, the parties hereto have hereunto set, their signatures as of the date first above written, "Landlord" DAVID ROSS II, LLC, a California limited liability company ~,~-r-l-[I:.Jr-» Lcm Name: Arlene Rosales 8,: Its.'President "Tenant" ROSE GARDEN SUBACUTE k REHABILITATION CENTER, LLC, a California limited Iiabjl y company Name: 85ov Jacobs Title: Manager ~ Schedules and Exhibits Schedule 1.1 Inventory of Leased Assets Schedule 2.1(fi Liens Schedule 2.1ihi OSIIPD Repairs Exhibit A Legal Description Exhibit B Lease Termination Exhibit C Guaranty Schedule 1,1 Inventoity of Leased Assets It'enl Area I&.itchen Walk-in freezer Ice machine Industrial blender Toaster Stove with burner Stainless steel food cart Utility cart Food mixer Table food warmer Stainless steel shelves Stainless steel working table Can opener Oven Food machine Coffee maker Bestway washer Bestway dryer Small washiitg machine Scivlng n1achlnc Office chair Ordinaiy table Amount 1 1 1 1 I 9 5 I I 13 3 I I I p1'occsso1'ishwashing Laundry Li11cn cai't Dining Room Living Room Business Office CNA linen cart Big portable tables Small portable tables TV8".DVD Water dispenser AC window unit Popcorn machine AC window unit Grand piano with chair Dining taMe Dining table chairs Copy machine Sofa chair Glass table Sofa table Computer desktop Office chair 1 1 2 2 I 1 3 2 2 12 3 3 I I 1 I 1 I I g I 3 4 I 3 3 Administrator Office Medical Records Activity Oflice Social Service Department DSD Rehab Room Steel meta'. cabinet Fax machine Office table Personal ref Water dispenser Metered stamp machine Office table Oi'fice chair Visitor cliair Coniputer AC window unit Monitor and RCVR Camera TV Safety Vault Personal ref Office table Office chair Computer Steel metal cabinet (small) Steel metal cabinet (big) Side table Computer table Office chairs Computer Printer Overhead table Activity cart TVil&araoke Casseyye radio Singer sewing machine Office table Visitor chair Office chair Office table Office chair Steel cabinet Computer desk top Pl'1nter Colnpute1'omputer 1 3 1 1 1 1 1 2 1' 1 1 1 1 3 3 2 6 3 1 1 2 1 1 1 I 1 1 1 1 2 1 1 1 1 1 1 Office table Off ce chair Flat XVeighing scale Exercising bed Exercising stairs Sub Acute 3 1 3 1 1 1 1 table 1 East Station West Station DON Office MDS Others Copy machine Personal ref Steel cabinet Shelves AC window unit Fax machine Office chair Medic!ne ref Fax machine Medicine ref Office chair Computer table Office table Visitor chairs Personal ref Computer Computer table Personal refrigerator Office chair Generator Hoyer lift manual Lift scale Iloyer lift battery Shower gurney Merri walker Meri Walker Lap lock Electric beds Manual bed Wheel chair Geri chair Overbed tables Bedside tables Visitor chair subacute rooms Airloss bed mattress Shov'er chair Trapeze AC window unit Blanket cradle 1 1 1 2 1 I 1 1 1 1 3 1 1 2 1 1 1 1 2 1 2 1 1 3 1 I 75 20 60 11 80 84 14 23 12 5 4 3 Schedule 2.1(fl Liens Filing No. Filing Type File Date ., Lapse Date l Debtor Secured Amount/Value Party 15-7483517041 Federal Tax Lien 9/02/2015 10/02/2025 David Ross Inc., Rose Garden Convalescent Center IRS/Ohio $ 357,556.81 15-7493447125 Federal Tax Lien 10/30/20! 5 11/29 2025 David Ross Inc., Rose Garden Convalescent Center IRS/Ohio $ 290,610.64 16-7510306504 Federal Tax Lien 2/11/2016 3/I 3!2026 David Ross lnc., Rose Garden Convalescent Center IRS/Ohio $ 192,151.67 13-7387771165 Financing Statement 11/21/2013 11/21/2018 David Ross Inc. dba Rose Garden Convalescent Center Eversoft, Inc. dba I-ID Chem Dish washer machine contract 20091756324 County Tax Lien 11/20/2009 unknown David Ross, Inc., Lessee Los Angeles County $ 443.00 20082097415 County Tax Lien 11/26/2008 unlcnown David Ross Inc. dba Rose Garden Convalescent Center Los Angeles County $ 203.63 20082090096 Judgement Lien 11/26/2008 unknown David Ross Inc. dba Rose Garden Convalescent. Center Golden West Trading Inc. $ 21,472.60 . . . None. Schedule 2.1(h) OSHPD Repairs 34 Exhibit "A" Legal Description APN: 5836-028-023 PARCEL I: THAT PORTION OF LOT "A" OF THE J.P. NELSON TRACT, IN THE CITY OF PASADENA, COUNTY OF LOS ANGELES, STATE OF CALIFORNIA, AS PER MAP RECORDED IN BOOK 83 PAGE 97 OF THE MISCELLANEOUS RECORDS, IN THE OFFICE OF THE COUNTY RECORDER OF SAID COUNTY, DESCRIBED AS FOLLOWS: BEGINNING AT THE SOUTHEAST CORNER OF SAID LOTS; THENCE NORTH ALONG AND EASY LINE OF SAID LOT, A DISTANCE OF 64 FEET; THENCE WEST 2001 EET; THENCE SOUTH PARALLEL WITH THE EAST LINE OF SAID LOT, A DISTANCE OF 64 FEET TO TI-IE SOUTI-I LINE THEREOF; THENCE EAST ALONG SAID LINE. 200 FEET TO TI-IE POINT OF BEGINNING. PARCFL 2: THAT PORTION OF TI-IE REPLAT OF BLOCKS I AND 2 OF J.P. NELSON'S SUBDIVISION OF BLOCK "I&" OF PAINTER AND BALL TRACT. IN THE CITY OF PASADENA, COUNTY OF LOS ANGELES, STATE OF CALIFORNIA, AS PER MAP RECORDED IN BOOI& 37 PAGE 99 OF MISCELLANEOUS RECORDS, IN THE OFFICE OF THE COUNTY RECORDER OF SAID COUNTY, DESCRIBED AS FOLLOWS: BEGINNING AT A POINT IN THE WEST LINE OF RAYMOND AVENUE, DISTANT 232 FEET NORTH FROM THE SOUTHEAST CORNER OF SAID REPLATS TI-IENCE WEST 195 FEET; TI-IENCE NORTI-I, PARALLEL WITH SAID WEST LINE OF RAYMOND AVENUE, 100 FEET, TO TI IE SOUTIIERLY LINE OF THE LAND IJESCRIBED IN THE DEED TO MARY I ORENA WOOD, RECORDED ON JULY 19, 1960 AS INSTRUMENT NO. 580 IN BOOK D-912 PAGE 900 OF OFFICIAL RECORDS OF SAID COUNTY THENCE ALONG SAID SOUTI-IERLY LINE TO THE SOUTI-IEAST CORNER OF THE LAND CONVEYED BY E.S. WILLIAMS, TRUSTEE TO J,P. NELSON, BY DEED RECORDED ON MAY 17, 1906 N BOOK 2668 PAGE 167 OF DEEDS, IN SAID OFFICE OF TI-IE COUNTY RECORIJER THENCE NORTH ALONG THE EAST LINE OF THE LAND SO CONVEYED, A DISTANCE OF 55 FEET, TO THE EASTERLY PROLONGATION OF THE SOUTI-IERLY LINE OF THE LAND DESCRIBED IN THE DEED TO DON CARLOS CONVALESCENT & NURSING HOME, A PARTNERSHIP, RECORDED ON NOVEMBER 13, 1958 IN BOOK D-273 PAGE 591 Ol'AID OI FICIAL RECORDS,'I-IENCE WEST ALONG SAID PROLONGATION, A DISTANCE OF 55 FEET TO Tl IE NORTHEAST CORNER TI IEREOF; TI IENCE EAST 247 FEET, MORE OR LESS, TO SAID WEST LINE OF SAID RAYMOND AVENUE; TI-IENCE SOUTH ALONG SAID WEST LINE OF RAY!vIOND AVENUE, 210 FEET TO THE POINT OF BEGINNINC, 35 Exhibit Lease Termination 36 LEAS Ii'. TKRMI NATION A(~ REElVl ENT TI-IIS LEASE TERMINAT1ON AGREEMEN'I (this "Agreement" is made and ) entered into as of April I5, 2016 by and among Arlene II. Rosales l,iving 'I'nist (the "Lessor") and David Ross, Inc,, a California corporation (thc "Lessee") with reference to thc following facts: RECITALS Lessor is the Lessor under that cet~in Lease dated as ol'.lnnuary I, 2014, between Lessor and Lessee and ail parts thereof and iunendmeiits thereto (the '"Lease'"). The Lease covers improved real property in the City of Pasadena, California, with a street address 1899 N. Raymond Avenue, Pasadena, California (the "Property" ). A, Pursuant to the Lease, Lessee operates a skilled nursing facility, commonly known as Rose Ciarden Convalescent Center which is located on the Property (the "Facility" ). B. Effective on or before April 16, 2016, the Facility operations will be transferrecl to the New Operator (as detined below) pursuant to the terms of'his Agreemeni. and the Transition Documents 1'as defmcd below). C, for. D. Lessor and Lessee desire io entct into this Agreement, in order to provide a peaceful and orderly termination of }he Lease between Lessor and Lessee, ~A" RKKMKNT NOW, TFIEREFORE, in consideration of the above-reference facts and the covenants of Lessor and I.essee contained in this Agreement, and for the other good and valuable consideration, the receipt and sufficiency oi'hich are hereby acknowledged, Lessor and Lessee agree as follows: 1. Effective Date. Date") shall be April 6, 2016. The effective date of this Agreement (the "Effective .I 2. I'ermination. On the Effective Date, the Lease shall terminate iutd any recorded references io the Lease shali be ren;oved of recmd. i. ~Stli ii ii. Th i, L dpi i ti ~ i s 1;&viiydep ii dL has not deposited any security deposit with Lessor. As of the date of this Lease Termination, the I.essee is current. on all rental payments owed to I.cssor under the Lease. 4. Mi ii ~pi iona. 4,1 Cioveminu Law, This Agreement shall be governed by and construed in accordance with the laws of the State of California. it. Ag'»ti 4.2 ~ftitlh li f di ifssf so isio fthl bc invalid or unenforceable by any court or other lawful forum such provision shall be inel'Tective only to the extent that it is in contravention or applicable laws without invalidating the remaining provisions of this Agreement, unless such invalidity or unenforceability would defeat an essential business purpose of this Agreement. 4.3 C'ounternarts, This Agreement may be executed in two or more countcq&arts, each of which shall be deemed an original, but all of which taken together shall constitute one and the sante insuafment. This Agreement shall be deemed signed and delivered upon the exchange by facsimile transmission (fax), electronic or PDFs of signed counterparts. g~!' Thi,rAgt » ' 11th hittt 4 tl parties to this Agreement and on their respective heirs„devisees, successors and assigns. 4.4 dA i . 4,5 Attornevs'ees. Should any party to this Agrernnent institute any action or proceeding arising out of this Agreement the substantially prevailing party in any such action of proceeding shall be entitled to receive from the other party or parties to such action or proceeding all costs and expenses, including reasonable attorneys'ees, incurred by the substantially prevailing party in connection with such action or proceeding. The determination, of which party is the "substantially prevailing party," shall be made by the cont% or arbitrator, as applicable, at the time of'hc action or proceeding, as the case may bc. Notwithstanding the foregoing, attorneys'ees incuned in enforcing any judgment are recoverable &as a separate item and such agreement of the parties is intended lo be severable f'rom the other provisions of this Agreement and is intended to survive any judgment and is not to be deemed merged into any judgment. EVIDENCINCt their agt'cement to the above terms and conditions, Lessor and Lessee have executed this Agreement as of the. date first set forth above. [SIGNA TUBES Ojhf iVl';.YT PAGE] Signature I'age — Lease Te& rninatian LESSEE: California David Ross, Inc., a B;: corporation E);M ~.&Mmes~ Name: Arlene H. Rosales Its: President LESSOR: ARLENE H. ROSAI ES, AS TRUSTEE Ol'HE ARLFNE H. ROSALES LIVING TRI JST By: Name: Arlene H. 1Cosales Its: Trustee OPERATING ACiRKKII4KNT This Operating Agreement is entered into this !" of 3anuary 2014, between David Ross II, LLC (Lessor) and David Ross, Inc. (Lessee). The parties agree as foHows: I, Lessor shall lease out Rose Garden Convalesccrit Certtrt located at I 899 N, Rayinond Ave., Pasadena, CA 9 I I 03, f'o r a period of live (5) years and renewable every year at the discretion After five (5) years„ this contmct is negot.iable. oi'essor. 2. Lessee will provide a car for the life of the Operating Agreement. 3, Lessee will pay Lessor rent in the amount of $37,620.00 a month, due on thc first (I") day of every month, with rent increases annually. The reit will incr'ease to 839,000.00 a month beginning on April I, 20 I 4. 4. Lessee and other nominees wi! I be added as n member(s) of thc Board of Directors of David Ross, Inc. 5. Lessee will follow all terms in the original lease agreement between David Ross Ross, Inc. 6. Any addition, deletion or modification of any existing ot new bank accounts that are or will bc linked to David Ross, Inc. must bc opened, deleted, modified or added by I,cssor and/or any of its members only. Lessor: Israel"va~ Managing Member, David Ross li LLC~r II LLC snd David Lessee: //u 3 President, David Ross, Inc. 1899 N. Raymond Ave. Pasadena California 91103 s Tcl (626)7972120 "'ax: (626)7975824 Exhibit "C" GUARANTY OF LEASE TI-IIS GUARANTY OF LEASE (" Guaranty" ) is made by Dov E. Jacobs and Miriam Taub, each an individual (collectively, the "Guarantor") in favor of David Ross II, LLC, a California limited liability company (the "Landlord" ), in connection with that certain Operating Lease, dated as of 2016 (the "Lease" ), pursuant to which Landlord leases to Rose Garden Subacute k Rehabilitation Center, LLC, a California liinited liability company (" Tenant" ) those premises improved with a sltilled nursing facility, located at 1899 North Raymond Avenue, Pasadena, California 91103, and such other Property included within the term "Leased Premises" as defined in the Lease. As a material inducement to and in consideration of Landlord entering into the Lease, Landlord having indicated that it would not enter into the Lease without the execution of this Guaranty, Guarantor does hereby agree with Landlord as follows: April, Guarantor does hereby, unconditionally and irrevocably guarantee, as a primary obligor and not as a surety, and promises to perform and be liable for any and all obligations and liabilities of Tenant under the terms of the Lease, This Guaranty is being given so that Landlord shall look solely to the Guarantor and not to the members, officers, and directors of Tenant for satisfaction for any unsatisfied claims against Te!tant, Except as specifically set forth herein, the Guaranty shall otherwise be unlimited. 1. Guarantor does hereby agree that, without the consent of or notice to Guarantor and without affecting any of the, obligations of Guarantor hereunder: (a) any term, covenant or condition of the Lease may be amended, compromised, released or otherwise altered by Landlord and Tenant, and Guarantor does guarantee and promise to perform all the obligations of Tenant under the Lease as so amended, compromised, released or altered; (b) any guarantor of or party to the Lease may be released, substituted or added; (c) any right or rinnedy under the Lease may be exercised, not exercised, impaired, modified, limited, destroyed or suspended; (d) Landlord or any other person acting on Landlord's behalf may deal in any manner with Tenant, any guarantor, any party to the Lease or any other person; and (e) all or any part of the Leased Premises or of Tenant' rights or liabilities under the Lease may be sublet, assigned or assumed. This is a continuing guaranty. 2. 3. Guarantor hereby waives and agrees not to assert or take advantage of: (a) any right to require Landlord io proceed against Tenant or any other person or to pursue any other remedy before proceeding against Guarantor: (b) the defense of any statute of limitations in any action under or related to this Guaranty or the Lease; (c) any right or defense that may arise by reason of the dissolution or lack of authority of Tenant or any other person; and (d) any right or defense arising by reason of the absence, impairment, modification, limitation, destruction or cessation (in bankruptcy, by an election of remedies, or otherwise) of the liability of Tenant, of the subrogation rights of Guarantor or of the right of Guarantor to proceed against Tenant for reimbursement. Without in any manner limiting the generality of the foregoing, Guarantor hereby waives the benefits of the provisions of Sections 2787 to 2855, inclusive,2899 and 3433 of the California Civil Code and any siniilar or analogous statutes of California or any other jurisdiction. 4. Guarantor hereby waives and agrees not to assert or take advantage of any right or defense based on the absence of any or all presenmients, demands (including demands for performance), notices (including notices of adverse change in the financial status of Tenant or other facts which increase the risk to Guarantor, notices of non-perfonnance and notices of acceptance of this Guaranty) and protests of each and cveiy kind, Neither Guarantor's obligation to make payment in accordance with this Guaranty nor any remedy for the enforcement thereof shall be impaired, modified, changed, stayed, released or limited in any manner by any impairment, modification, change, release, limitation or stay of the liability of Tenant or its estate in bankruptcy or any remedy for the enforcement thereof, resulting from the operation of any present of future provision of the Bankruptcy Code (as defined in the Lease) or oiher statute or from the decision of any court interpreting any of the same, and Guarantor shall be obligated under this Guaranty as if no such impairment, stay, modification, change, release or limitation had occurred. 5. 6, Until all of Tenant's obligations under the Lease are fully performed, Guarantor (a) shall have no right of subrogation against Tenant by reason of any payments or acts of performance by Guarantor under this Guaranty; and (b) subordinates any liability or indebtedness of Tenant now or hereafter held by Guarantor to the obligations of Tenant under, arising out of or related to the Lease or Tenant's use or occupancy of ihe Leased Premises. 7. The liability of Guarantor and all rights, powers and remedies of Landlord hereunder and under any other agreement now or at any time hereafter in force between Landlord and Guarantor relating to the Lease shall be cumtilative and not alternative and such rights, powers and remedies shall be in addition to all rights, powers and remedies given to Landlord by law. 8. This Guaranty applies to, inures to the benefit of and binds all parties hereto, their heirs, devisees, legatees, executors, administrators, representatives, successors and assigns (including any purchaser at a judicial foreclosure or trustee's sale or a holder of a deed in lieu thereof). This Guaranty may be assigned by Landlord voluntarily or by operation of law. Any Guarantor hereunder may be replaced with a replacement Guarantor, reasonably acceptable to Landlord. 9. Guarantor shall not, v,ithout the prior written consent of Landlord, commence, or join with any other person in commencing, any bankruptcy, reorganization or insolvency proceeding against Tenant. The obligations of Guarantor under this Guaranty shall not be altered, limited or affected by any proceeding, voluntarily or involuntarily, involving the banlcruptcy, insolvency, receivership, reorganization, liquidation or arrangement of Tenant, or by any defense which Tenant may have by reason of any order, decree or decision of any court or administrative body resulting from any such proceeding. Guarantor shall file in any bankruptcy or other proceeding in which the filing of claims is required or permitted by law all claims which Guarantor may have against Tenant relating to any indebtedness of Tenant to Guarantor and will assign to Landlord all rights of Guarantor thereunder. Landlord shall have the sole right to accept or reject any plan pioposed in sucli proceeding and to take aiiy other action whicli a party filing a claiiii is etititled to do. In all such cases, whether in administration, bankruptcy or otherwise, the person or persons authorized to pay such claim shall pay to Landlord the amount payable on such claim and, to the full extent necessary for that purpose, Guarantor hereby assigns to Landlord all of 38 Guarantor's rights io any such payments or distributions to which Guarantor would otherwise be entitled; provided, however, that Guarantor's obligations hereunder shall not be satisfied except to the extent that Landlord receives cash by reason of any such payment or distribution. If Landlord receives anything hereunder other than cash, the same shall be held as collateral for amounts due under this Guaranty. 10. If requested by the Landlord, Guarantor shall deliver to the Landlord (a) the most recent federal income tax return for Guarantor within thirty (30) days after the date on which such return is filed by Guarantor. Guarantor shall provide the Landlord with such other information and statements concerning the financial condition and affairs of Guarantor as the Landlord may require within five (5) business days after the Landlord's request for such reasonable information. All financial information and statements provided by Guarantor to Landlord shall be certified to be true and correct by Guarantor. 11, As a material inducement to the Landlord entering into the Lease with Tenant, Guarantor makes the following representations and warranties to the Landlord, each of which shall survive the commencement and termination of the Lease: 11.1. Guarantor has the full power and authority to carry on its business and to enter into and perform all of its obligations under this Guaranty, and this Guaranty, when executed by Guarantor, shall constitute the legal, valid and binding obligation of Guarantor enforceable in accordance with its terms, No consent of any other person not previously obtained by Guarantor, and no consent, approval, authorization or other action by or filing with any governmental authority not previously obtained, taken, or made, as applicable, is required in connection with the execution, delivery and performance of Guarantor's obligations under this Guaraiity. Guarantor's execution of this Guaranty and Guarantor's performance of its obligations hereunder will noi result in a breach or violation of (a) any govermnental requirements applicable to Guarantor or any judgment, v rit, injunction, decree or order of any cond relating and known to Guarantor; or (b) any mortgage, commitment, restriction, or other document to which Guarantor is a party or by which Guarantor is bound. 11.2. All statetnents respecting the financial condition of Guarantor and Tenant, respectively, which have been I'urnished to the Landlord or which are hereafter submitted to the Landlord (a) are or shall be accurate and complete in all respects as of the dates appearing thereon; (b) present or shall present fairly the financial condition and results of operations of the person to whom the financial statcmeni apphes as of thc dates and for the periods shown on such statements; (c) disclose or shall disclose all suits, actions, proceedings and contingent liabilities materially affecting the person to whom the financial statement applies; and (d) since the last date covered by ihe financial statements which have been furnished to the Landlord, there has been no material adverse change in the financial condition of the persons to whom such statements apply. All other reports, information and documents furnished to the Landlord by Guarantor in connection with the Lease are accurate and complete in all respects. "I he confidentiality provisions contained in the Lease shall be incorporated by reference into this Guaranty, provided that all references to "Tenant" shall be deemed Guarantor. 11.3. There are no actions, suits, proceedings or investigations pending or, to the best of Guarantor's knowledge, threatened against or affecting Guarantor i'n any court or before any other governmental authority, nor does Guarantor know of any basis for any such action, suit, proceeding or investigation. 11.4, 11.5. Guarantor has received a copy of the Lease, has carefully read such Lease, and understands all of the terms of such Lease. 12. Guarantor hereby covenants and agrees that it shall not, without the prior written consent of Landlord, which consent may be granted or withheld in Landlord's reasonable discretion, take any action that would have a material adverse effect on the Guarantor's ability to pay any of its liabilities or perform any of its obligations under this Guaranty. 13, This Guaranty shall constitute the entire agreement between Guarantor and the Landlord with respect to the subject matter hereof. No provision of this Guaranty or right of Landlord hereunder may be waived nor may Guarantor be released from any obligation hereunder except by a writing duly executed by Landlord. 14. If more than one person signs this Guaranty, each such person shall be deemed a Guarantor and the obligation of all such Guarantors shall be joint and several. When ihe context and construction so requires, all words used in the singular herein shall be deemed to have been used in the plural. The word "person" as used herein shall include an individual, company, firm, association, partnership, corporation, trust or other legal entity of any kind whatsoever. 15. Should any one or more provisions of this Guaranty be determined to be illegal or unenforceable, all other provisions shall nevertheless be effective. a 16. The waiver or failure to enforce any provision of this Guaranty shall noi operate as waiver of any other breach of such provision or any other provisions hereof. 17. Upon ihe Landlord's demand. Guarantor shall reimburse the Landlord for all costs and expenses, including attorney, accountant, consultant, and expert witness fees and costs, which are incurred by the Landlord in connection with the exercise of any or all of the Landlord's rights and remedies under this Guaranty, including attorney fees and costs incurred in connection with the enforcement of the Lease and/or all of the Landlord's rights against Guarantor under this Guaranty, whether or not any legal proceedings are instituted by the Landlord, and all costs, attorney fees and expenses incurred by the Landlord in connection with any battitruptcy proceeding or other similar proceeding involving Guarantor which in any way affects the I.andlord's exercise of any of its rights and remedies under this Guaranty, Guarantor's obligation to reimburse the Landlord under this Section shall include payment of interest on all amounts expended by the Landlord from the date of expenditure at the rate of ten percent (10%) per annum. Without limiting the terms of this Section, Guarantor agrees thai the Landlord shall be entitled io retain such attorneys as the Landlord, in its sole discretion, may select at such attorneys customary rates and charges for legal fees, costs and other services, and the Landlord shall be entitled to full reimbursement from Guarantor for all such fees, costs and charges, regardless of any schedule, formula or other guideline for attorney's fees, whether described as reasonable or otherwise, which 40 is established, set or adopted pursuant to any governmental requirement or by any trial, appellate, or banl&ruptcy court or governmental authority, Time is strictly of the essence under this Guaranty and any amendment, modification or revision hereof. 111, 19, If Guarantor is a corporation, each individual executing this Guaranty on behalf of said corporation represents and wattants that lie is duly authorized to execute and deliver this Guaranty on behalf of said corporation, in accordance with a duly adopted resolution of the board of directors of said corporation or in accordance with the bylaws of said corporation, and that this Guaranty is binding upon said corporation in accordance with its teims, II'uarantor is a corporation, Landlord, at its option, may require Guarantor to concurrently, with the execution of this Guaranty, deliver to Landlord a certified copy of a resolution of the board of directors of said corporation authorizing or ratifying the execution of this Guaranty. The term "Landlord" whenever hereinabove used refers to and means the Landlord in the foregoing Lease specifically named and also any assignee of said Landlord, whether by outright assignment or by assignment for security, and also any successor to the interest of said Landlord or of any assignee of such Lease or any part thereof, whether by assignment or otherwise. The term "Tenant" whenever hereinabove used refers to and means the Tenant in the foregoing I.ease specifically named and also any assignee or subtenant of said Lease and also any successor to the interests of said Tenant, assignee or sublessee of such Lease or any part thereof, whether by assigmttent, sublease or otherwise. 20. Any notice, request, demand, instruction or other communication to be given to any party hereunder shall be in writing and shall be either served personally, or sent by overnight courier, or registered or certified mail, return receipt requested with postage prepaid, and addressed to the party to be notified at the address set forth below, or to such other place as the party to be notified may from time to time designate by at least fifteen (15) days'otice to the notifying party. Any such notice, request, demand, instrucl.ion or other communication shall be deemed sufficiently sea ed or given for all purposes hereunder either (a) if personally served, upon such service, (b) if sent by overnight courier, the following business day, or (c) if mailed, two (2) business days after the time of mailing or on the date of receipt shown on the return receipt, whichever is first: To Guarantor: 21. Dov E. Jacobs 11600 W. 'vVashingtor Blvd. Los Angeles.,CA 90066 Miriam Taub 395 Pearsall Ave., Ste. K Cedarhurst, NY 11516 41 With a copy to (which shall not constitute notice): Sanders Rehaste Sternshein k Harvey, LLP Attn: Jennifer M. Stemshein, Esq, 5316 E. Chapman Avenue Orange, CA 92869 Telephone: 714-289-7070 Fax No. 714-289-7071 E-mail:Jetuufertasrshhealthlaw.corn To Landlord: David Ross II, LLC c/o Arlene Rosales 1307 Dana Place Fullerton, CA 92831 With a copy to: Siteman Law Group Attn: I&.aren B. Siteman 433 N. Camden Dr., 4" Floor Beverly Hills, CA 90210 Telephone: (310) 279-5249 Facsimile: (310) 279-5248 E-mail: kbsiteman@sitemanlawgroup.corn As a further material part with Tenant, Guarantor agrees: 22, of the consideration to Landlord to enter into the Lease 22.1. The law of the state in which the Leased Premises is located shall govern all questions with respect to the Guaranty; 22.2. That any suit, action or proceeding arising directly or indirectly front the Guaranty, the Lease or the subject matter thereof shall be litigated only in courts located within the county and state in which the Leased Premises is located; 22.3. Guarantor hereby irrevocably consents to the jurisdiction of any local, state or federal court located within the county and state in which the Leased Premises is located; 22.4. Guarantor hereby waives personal service of any and all process upon it and consents to all such service of process in the marmer and at the address set forth in Paragraph 20 above; and 22,5. Without limiting the generality of the foregoing, Guarantor hereby waives and agrees not to assert by way of motion, defense or otherwise in any suit, action or proceeding any claim that Guarantor is not personally subject to the jurisdiction of the above-natned courts, that such suits, action or proceeding is brought in an inconvenient forum or that the venue of such action, suit or proceeding is improper, 23. All undefined capitalized ternts used herein shall have the satne meaning as set forth in the Lease. 24, Guarantor acknowledges and agrees that Landlord may fttrther assign this Guaranty to Landlord's lender, its successors and assigns. ISignntttres onIoiiotving page1 43 IN WITNESS WHEREOF, the parties have duly executed and notarized this Guaranty as of the dates written below. GUARANTOR; Dated: April, 2016 Dated: April, 2016 Dov E. Jacobs Miriam Taub A Notary Acknowledgement Form is attached hereto. Exhibit 1.1 GUARANTY OF LEASE THIS GUARANTY OF LEASE (" Guaranty") is made by Dov E. Jacobs and Miriam Taub, each an individual (collectively, ihe "Guarantor" ) in favor of David Ross II, LLC, a California limited liability company (the "Landlord" ), in connection with that certain Operating Lease, dated as of April 16, 2016 (the "Lease"}, pursuant to which Landlord leases to Rose Garden Subacute & Rehabilitation Center, LLC, a California hmited liability company (" Tenant" ) those premises improved with a skilled nursing facility, located ai 1899 North Raymond Avenue, Pasadena, California 91103, and such other Property included within the term "Leased Premises" as defined in the Lease. As a material inducement to and in consideration of Landlord entering into the Lease, Landlord having indicated that it would not enter into the Lease without the execution of this Guaranty, Guarantor does hereby agree v:ith Landlord as follows: Guarantor does hereby, unconditionally and irrevocably guarantee, as a primary obligor and not as a surety, and promises to perform and be liable for any and all obligations and liabilities of Tenant under the terms of the Lease, This Guaranty is being given so that Landlord shall look solely to the Guarantor and not to the members, officers, and directors of Tenant for satisfaction for any unsatisfied claims against Tenant. Except as specifically set forth herein, the Guaranty shall otherwise be unlimited, 1. 2. Guarantor does hereby agree that, without the consent of or notice to Guarantor and without affecting any of the obligations of Guarantor hereunder: (a) any term, covenant or condition of the Lease may be amended, compromised, released or otherwise altered by Landlord and Tenant, and Guarantor does guarantee and promise to perform all the obligations of Tenant under the Lease as so amended, compromised, released or altered; (b) any guarantor of or party to the Lease may be released, substituted or added; (c) any right or remedy under the Lease may be exercised, not exercised, impaired, modified., limited, destroyed or suspended; (d) Landlord or any other person acting on Landlord's behali may deal in any manner with Tenant, any guarantor, any party to the Lease or any other person: and (e) all or any part of the Leased Prtunises or of Tenant' rights or liabilities under the Lease niay be sublet, assigned or assumed. This is a continuing guaranty. 3, Guarantor hereby waives and agrees not to assort or take advantage of: (a) any right to require Landlord to proceed against Tenant or any other person or to pursue any other remedy before proceeding against Guarantor:, (b) the defense of any statute of limilations in any action under or related to this Guaranty or the Lease:, (c} any right or defense that may arise by reason of the dissolution or lack of authority of Tenant or any other person; and (d) any right or defense arising by reason of the absence, impairment, modification, limitation, destruction or cessation (in bankruptcy, by an election of remedies, or otherwise) of the liability of Tenant, of the subrogation rights of Guarantor or ol'he right of Guarantor to proceed against Tenant for reimbursement, Without in any manner limiting the generality of the foregoing, Guarantor hereby waives the benefits of the provisions of Sections 2787 to 2855, inclusive, 2899 and 3433 of the California Civil Code and any similar or analogous statutes of Cahfornia or any other jurisdiction. 4. Guarantor hereby waives and agrees not to assert or take advantage of any right or defense based on the absence of any or all presentments, demands (including demands for performance), notices (including iiotices of adverse change in the financial status of Tenant or other facts which increase the risk to Guarantor, notices of non-performance and notices of acceptance of this Guaranty) and protests of each and every kind. 5. Neither Guarantor's obligation to make payment in accordance with this Guaranty nor any remedy for the enforcement thereof shall be impaired, modified, changed, stayed, released or limited in any maimer by any impairment, modification, change, release, limitation or stay of the liability of Tenant or its estate in banl&ruptcy or any remedy for the enforcement thereof, resulting from the operation of any present of future provision of the Banl&ruptcy Cocle (as defined in the Lease) or other statute or from the decision of any court interpreting any of the same, and Guarantor shall be obligated under this Guaranty as if no such impairment, stay, modification, change, release or limitation had occurred. Until all of Tenant's obligations under the Lease are fully performed, Guarantor 1a) shall have no right of subrogation against Tenant by reason of any payments or acts of performance by Guarantor under this Guaranty; and {b) subordinates any liability or indebtedness of Tenant now or hereafter held by Guarantor to the obligations of Tenant under, arising out of or related to the Lease or Tenant's use or occupancy of the Leased Premises, 6. 7. The liability of Guarantor and all rights, powers and remedies of Landlord hereunder and under any other agreement nov or at any time hereafter in force between Landlord and Guarantor relating to the Lease shall be cumulative and not alternative and such rights, powers and remedies shall be in addition to all rights, powers and remedies given to Landlord by law, 8. This Guaranty applies to, inures to the benefit of and binds all parties hereto, their heirs, devisees, legatees, executors, administrators, representatives, successors and assigns (including any purchaser at a judicial foreclosure or trustee's sale or a holder of a deed in lieu thereof). This Guaranty may be assigned by Landlord voluntarily or by operation of law. Any Guarantor hereunder may be replaced with a replacement Guarantor, reasonably acceptable to Landlord. Guarantor shall not, without the prior written consent of Landlord, commence, or join with any other person in commencing,. any bankruptcy, reorganization or insolvency proceeding against Tenant. The obligations of Guarantor under this Guaranty shall not be altered, limited or affected by any proceeding, voluntarily or involuntarily, involving the balil&ruptcy, insolvency, receivership, reorganization, liquidation or arrangement of Tenant, or by any defense which Tenant may have by reason of any order, decree or decision of any court or administrative body resulting from any such proceeding. Guarantor shall file in any bankruptcy or other proceeding in which the filing of claims is required or permitted by law all claims which Guarantor may have against Tenant relating to any indebtedness of Tenant to Guarantor and will assign to Landlord all rights of Guarantor thereunder. Landlord shall have the sole right to accept or reject any plan proposed in such proceeding and to take any other action which a party filing a claim is entitled to do. In all such cases, whether in adnunistration, bankruptcy or otherwise, the person or persons authorized to pay such claim shall pay to Landlord the amount payable on such claim and, to the full extent necessary for that purpose, Guarantor hereby assigns to Landlord all of Guarantor's rights to any such payments or distributions to which Guarantor would otherwise be entitled; provided, however, that Guarantor's obligations hereunder shall not be satisfied except to the extent that Landlord receives cash by reason of any such payment or distribution. If Landlord 9. receives anything hereunder other than cash, the same shall be held as collateral for atnounts due under this Guaranty. 10. If requested by the Landlord, Guarantor shall deliver to the Landlord (a) the most recent federal income tax return for Guarantor within thirty (30) days after the date on which such return is filed by Guarantor, Guarantor shall provide the Landlord with such other information and statements concerning the financial condi'.ion and affairs of Guarantor as the Landlord may require within five (5) business days after the Land!ord's request for such reasonable information. All financial information and statemenis provided by Guarantor to Landlord shall be certified to be true and correct by Guarantor. 11. As a material inducement to the Landlord entering into the Lease with Tenant, Guarantor makes the following representations and warranties to the Landlord, each of which shall survive the commencement and termination of the Lease: 11.1, Guarantor has the full power and authority to carry on its business and to enter into and perform all of its obligations under this Guaranty, and this Guaranty, when executed by Guarantor, shall constitute the legal, valid and binding obligation of Guarantor enforceable in accordance with its terms. No consent of any other person not previously obtained by Guarantor, and no consent, approval, authorization or otlier action by or filing with any governmental authority not previously obtained, taken, or made, as applicable, is required in connection with the execution, delivery and performance of Guarantor's obligations under this Guaranty. 11.2. Guarantor's execution of this Guaranty and Guarantor's performance of its obligations hereunder will not result in a breach or violation of (a) any governmental requirements applicable to Guarantor or any judgment, writ, injunction, decree or order of any court relating and known to Guarantor; or (b) any mortgage, conmiilment, restriction, or other document to which Guarantor is a party or by which Guarantor is bound. All statements respecting the financial condition of Guarantor and Tenant, respectively, which have been furnished to the Landlord or which are herealder submitted to the Landlord (a) are or shall be accurate and complete in all respects as ol'the dates appearing thereon; (b) present or shall present fairly the financial condition and results of operations of the person to whom the financial statement appl ies as of the dates and for the periods shown on such statements; (c) disclose or shall disclose all suits, actions, proceedings and contingent liabilities materially affecting the person to whom the financial statement applies; and (d) since the last date covered by the financial statements which have been furnished to the Landlord, there has been no material adverse change in the financial condition of the persons to whom such statements apply. All other reports, information and documents furnished to the Landlord by Guarantor in connection with the Lease are accurate and complete in all respects. The confidentiality provisions contained in the Lease shall be incorporated by reference into this Guaranty, provided that all references to "Tenant" shall be deemed Guarantor. 11.3. There are no actions, suits, proceedings or invesiigal.ions pending or, to the best of Guarantor's knowledge, threatened against or affecting Guarantor in any court or before any other governmental authority, nor docs Guarantor know of any basis for any such action, suit, proceeding or investigation. 11.4. 11,5, Guarantor has received a copy of the Lease, has carefully read such Lease, and understands all of the terms of such Lease, Guarantor hereby covenants and agrees that it shall not, without the prior written consent of Landlord, which consent may be granted or withheld in Landlord's reasonable discretion, take any action that would have a material adverse effect on the Guarantor's ability to pay any of its liabilities or perform any of its obligations under this Guaranty. 12, 13. This Guaranty shall constitute the entire agreement between Guarantor and the Landlord with respect to the subject matter hereof. No provision of this Guaranty or right of Landlord hereunder may be waived nor may Guarantor be released from any obligation hereunder except by a writing duly executed by Landlord. 14. If more than one person signs this Guaranty, each such person shall be deemed a Guarantor and the obligation of all such Guarantors shall be joint and several. When the context and construction so requires, all words used in the singular herein shall be deemed to have been used in the plural. The word "person" as used herein shall include an individual, company, firm, association, partnership, corporation, trust or other legal entity of any kind whatsoever, Should any one or more provisions of this Guaranty be determined to be illegal or unenforceable, all other provisions shall nevertheless be effective. 15, 16, The waiver or failure to enforce any provision of this Guaranty shall not operate as a waiver of any other breach of such provision or any other provisions hereof. 17. Upon the Landlord's demand, Guarantor shall reimburse the Landlord for all cost.s and expenses, including attorney, accountant, consultant, and expert witness fees and costs, which are incurred by the Landlord in connection with the exercise of any or all of the Landlord's rights and remedies under this Guaranty, including attorney fees and costs incurred in connection with the enforcement of the Lease and/or all of the Landlord's rights against Guarantor under this Guaranty, whether or not any legal proceedings are instituted by the Landlord, and all costs, attorney fees and expenses incurred by the Landlord in connection with any bankruptcy proceeding or other similar proceeding involving Guarantor which in any way affects the Landlord's exercise of any of its rights and remedies under this Guaranty. Guarantor's obligation to reimburse the Landlord under this Section shall include payment of interest on all amounts expended by the Landlord from the date of expenditure at the rate of ten percent {10'to) per annum, Without limiting the terms of this Section, Guarantor agrees that the Landlord shall be entitled to retain such attorneys as the Landlord, in its sole discretion, may select at such attorneys customary rates and charges for legal fees, costs and other services, and the Landlord shall be entitled to full reimbursetuent from Guarantor for all such fees, costs and charges, regardless of any schedule, formula or other guideline for attorney's fees, whether described as reasonable or otherwise, which is established, set or adopted pursuant to any governmental requirement or by any trial, appellate, or bankruptcy court or governmental authority, Time is strictly of the essence under this Guaranty and any amendment, modification or revision hereof. 18. 19. If Guarantor is a corporation, each individual executing this Guaranty on behalf of said corporation represents and warrants that he is duly authorized to execute and deliver this Guaranty on behalf of said corporation, in accordance with a duly adopted resolution of the board of directors of said corporation or in accordance with the bylaws of said corporation, and that this Guaranty is binding upon said corporation in accordance with its terms. If Guarantor is a corporation, Landlord, at its option, may require Guarantor to concurrently, with the execution Guaranty, deliver to Landlord a certified copy of a resolution of the board of directors of said corporation authorizing or ratifying the execution of this Guaranty. ol'his 20. The term "Landlord" whenever hereinabove used refers to and means the Landlord in the foregoing Lease specifically named and also any assignee of said Landlord, whether by outright assignment or by assignment for security, and also any successor to the interest of said Landlord or of any assignee of such Lease or any patt thereof, whether by assignment or otherwise, The term "Tenant" whenever hereinabove used refers to and means the Tenant in the foregoing Lease specifically named and also any assignee or subtenant of said Lease and also any successor to the interests ol'aid Tenant, assignee or sublessee of such Lease or any part thereof, whether by assignment, sublease or otherwise. 21, Any notice, request, demand, instruction or other communication to be given to any party hereunder shall be in writing and shall be either served personally, or sent by overnight courier, or registered or certified mail, return receipt requested with postage prepaid, and addressed to the party to be notified at the address se"; forth below, or to such other place as the party to be notified may from time to time designate by at least fifteen (15) days'otice to the notifying party. Any such notice, request, demand, instmction or other communication shall be deemed sufficiently served or given for all purposes hereunder either (a) if personally served, upon such service, (b) if sent by overnight courier, the follov'ing business day, or (c) if mailed, two (2) busiiiess days after the time of mailing or on the date of receipt shown on the return receipt, whichever is first: To Guarantor: Dov E. Jacobs 11600 W. Washington Blvd. Los Angeles, CA 90066 Miriam Taub 395 Pearsall Ave., Ste. K Cedarhurst, NY 11516 With a copy to (which shall not constitute notice): Sanders Rehaste Sternshein 4 Harvey, LLP Attn: Jennifer M. Sternshein, Esq. 5316 E. Chapman Avenue Orange, CA 92869 Telephone: 714-289-7070 Fax No, 714-289-7071 E-mail:JennifergasrsltheaIthiaw.corn 5. To Landlord: David Ross II, LLC c/o Arlene Rosales 1307 Dana Place Fullerton, CA 92831 With a copy to: Siteman Law Group Attn: Karen B. Siteman 433 N. Camden Dr., 4a Floor Beverly I-Iills, CA 90210 Telephone; (310) 279-5249 Facsimile: (310) 279-5248 E-mail; kbsiteman@sitemanlawgroup.corn 22, As a further material part with Tenant, Guarantor agrees: of the consideration to Landlord to enter into the Lease 22.1. The law of the state in which the Leased Premises is located shall govern all questions with respect to the Guaranty; 22.2, That any suit, action or proceeding arising directly or indirectly from the Guaranty, the Lease or the subject matter thereof shall be litigated only in courts located within the county and state in which the Leased Premises is located; 22.3. Guarantor hereby irrevocably consents to the jurisdiction of any local, state or federal court located within the county and state in which the Leased Premises is located; 22.4. Guarantor hereby waives personal service of any and all process upon it and consents to all such service of process in the manner and at the address set forth in Paragraph 20 above; and 22,5, Without limiting the generality of the foregoing, Guarantor hereby waives and agrees not to assert by way of motion, defense or otherwise in any suit, action or proceeding any claim that Guarantor is not personally subject to the jurisdiction of the above-named courts, that such suits, action or proceeding is brought in an inconvenient forum or that the venue of such action, suit or proceeding is improper. 23. All undefined capitalized terms used herein shall have the same meaning as set forth in the Lease. Guarantor acknowledges and agrees that Landlord may further assign this Guaranty to Landlord's lender, its successors and assigns. 24. fSignarures on following page] Rose Garden Subacute c% Jiettabilitation Center, LLC Guaranty-Signature Page IN WITNESS WHEREOI of the dates written below. Dotv-jacobs ., the parties have duly executed and notarized this Guaranty as Dated: July JP, 2016 A Notary Acknowledgement Form is attached hereto. ACKNOWLEDGMENT other officer completing this certificate verifies only the identity of the individua who signed the document io wh:ch this certificate attached, and not the truthfulness, accuracy, or validity of that document. A notary public or State of California County of On 07 Los Angeles / 8 / 2016 I befo~ e me A Sheikh, Notary Public (insert name and title of the officer) I7f) V ~ ~ ZA C~B 5 personally appeared who proved to me on the basis of satisfactory evidence to be the person(tf} whose name(g is/ere subscribed to the within instrument and acknowledged to me that executed the same authorized capacity(tea), and that by signature{)t) on the instrument the person0t), or the entity upon behalf of which the person(g) acted, executed the instrument. his/~r I his/~r he/~ certify under PENALTY OF PER 'URY under ihe laws of the State of California that the foregoing paragraph is true and correct. WITNESS my hand and olfici-I .,eai. {Seal) in Rose Garden Subacute rfr Rebabiiitation Center, I.LC Guaranty-Signature Page IN WITNESS WI-IEREOF, the parties have duly executed and notarized tltds Guaranty as of the dates written below. GUARANTOR; Dated: Dov E, Jacobs r Dated; April ~X, 2016 ir'iaqrputt El IY(rl-II Notary Purrl ... '; '.d April, 2016 l(ol-IN of I'Iaw York I',lo..'iu.o'I re.r 0 0(r 1(r I Qualifia Commissiur r llr SZZ-d (/e@rtS ( obrir IZO/SOO'd y Ackllowledgctnerlt Form ts attaclled hereto. ZOO-J. IZOZOOZVI1 dtl 'ZB/rNVH 'I NIBHSNNBJS BISVHBN SZBONVS-IIONd 81':ll OIOZ-Sl-Ndr Exhibit 2 AGREEMENT OF LEASE This Agreement of Lease (the "Lease") is executed in duplicate as of this 16's day of April, 2016, by and between the ARLENE H. ROSALES LIVING TRUST dated FEBRUARY 2,2012 (the "Landlord" ) and LEGACY HEALTI-ICARE CENTER, LLC a California limited liability company (" Tenant" ). RECITALS A. Landlord is the owner of the land, buildings and improvements thereon and the furniture, fixtures and equipment that contains the opemtions of that certain fifty-four (54) bed skilled nursing facility, licensed by the California Department of Public Health ("CDPH"), Medicare and Medi-Cal certified, and commonly known as "Legacy Care of Pasadena" located at 1570 North Fair Oal&s Avenue, Pasadena, California 91103 {the "Facility" and collectively the "Leased Premises" ) and as more fully described in the legal description attached hereto as KxBrtin' and incorporated herein by this reference. The Facility is currently leased and licensed to Par Operations, Inc., a California (" corporation Prior Tenant" ), pursuant to a lease dated April 1, 2015 (the "Prior Lease" ) which Prior Lease shall terminate upon the Commencement Date (hereinafter defined) pursuant to the terms of the Lease Termination attached hereto as Exit B. tan', C. Landlord desires to lease the Facility to Tenant, and Tenant desires to lease the Facility from Landlord according to the following terms and conditions. AGREKMKNT 1. General Undettakina. 1.1 That for and in consideration of the rental hereinafter reserved and of the mutual covenants, agreements and conditions hereinafter contained, Landlord does hereby lease, let and demise unto Tenant, and Tenant does hereby take, accept and rent from Landlord, those certain premises as described on Exn&BIT A hereto situated in the County of Los Angeles, State of California, commonly known as Legacy Care of Pasadena, 1570 North Fair Oal&s Avenue, Pasadena, California 91103, together with all of Landlord's right, title and interest, if any, in and to all machinery, trade equipment, trade fixtures, furniture, furnishings, beds, and accessories of all kinds used in connection with the Facility, including all personal property (an inventory of which is attached hereto as Schedule 1.1), whether tangible or intangible; and all rights, if any, to apply for licensure and operate the Facility as a licensed nursing facility in the State of California and all rights, if any, to apply for Medi-Cal and Medicare certification of the beds (collectively the "Leased Assets" ). The Leased Assets shall not include any of Tenant's personal property which is not essential lo operation of the Facility or which is not a replacement of any of the Leased Assets. 2. Representations and Warranties. 2.1 Landlord Renresentations and Warranties. Landlord warrants and represents to Tenant that it is the owner (a) of the Leased Premises, and that it is duly authorized and empowered to make and enter into this Lease with Tenant, Landlord represents and warrants that, as of the Commencement Date and after the satisfaction of the condition precedent contained in Section 3.2(a) of this Lease, there are no other tenants to the Leased Premises or any other person who has a right to possession of the Leased Premises. (b) Landlord represents and warrants that Landlord has no notice, (c) written or oral, that the Leased Premises are in violation of any applicable rulings, zoning, parking requirements or other laws or ordinances. Landlord represents and warrants that the Facility is licensed by (d) CDPH as a fifty-four (54) bed skilled nursing facility, and that the Facility is cettified for participation in the Medicare and Medi-Cal programs and has active and valid provider agreements. Landlord represents and warrants that there is no litigation pending (e) or threatened against the Leased Premises, Landlord or Prior Tenant. Other than as set forth on Schedule 2.1(ft, neither the Leased Premises, nor the property of either Landlord or Prior Tenant are encumbered by any liens of mechanics, laborers, or materialmen, chattel mortgages, the Internal Revenue Service, any Governmental Authority (deltned belov ) or any other liens. All liens set forth on Schedule 2.1(fl shall be released prior to the Commencement Date and Tenant shall have no liability for any such lien not so released prior to the Connnencentent Date or otherwise. "Governmental Authority" shall mean OSHPD, or any court, board, agency, arbitrator, connnission, office or other authority of any nature whatsoever Ior any governmental unit (foreign, federal, state, county, district, municipal, city or otherwise) whether now or hereafter in existence having jurisdiction over the Leased Premises. (fl Landlord represents and warrants that except as set I'orth on (g) Schedule 2.1(a), there are no other room size waivers in place at the Facility as of the Commencement Date (the "Room Size 'A'aivers"). Except as set forth in Schedule 2.1(h'1 hereto, Landlord represents and warrants that all physical plant repairs, replacements and maintenance have been completed in accordance with applicable law and, if required, with OSPHD approval. (h) 2.2 Tenant Renresentations and Warranties. Tenant is a limited liability company, duly formed and validly (a) existing and in good standing under the lav"s of the State of California, and has the limited liability company power and authority to ov;n its property and assets and to carry on its business as now being conducted or as will be conducted on and after the Commencement Date. The execution, delivery and performance of this Lease by Tenant will not, as of the Conunencement Date, conflict with or result in a breach of or default under any of the terms, conditions or provisions of Tenant's articles of organization, or operating agreement. (b) This Lease constitutes the valid and binding obligation of Tenant, (c) fully enforceable in accordance with its terms. As of the Commencement Date, there is no suit, claim, action or (d) legal, administrative, arbitration, or other proceeding or governmental investigation pending or threatened, by or against Tenant, 3. Term of Lease. Thc Term of the Lease (or "Lease Terin") provided for herein is ten (10) years, and shall conunence on the Commencement Date and terminate on the tenth (10'") anniversary thereof, unless sooner terminated by Landlord or as otherwise provided in this Lease or by law. 3,1 3,2 Tenant shall have tv o (2) options (each, a "Renewal Option" ), to extend this Lease for an additional period of five (5) years each (each, an "Extension Term" ), provided Tenant is not in default, with all rights of cure expired or impossible, under this Lease at such time as it exercises such Renewal Option. Each Renewal Optioii for each Exiension Term shall be exercised by Tenant, giving written notice (an "Option Notice" ) to Landlord not less than six (6) months nor more than twelve (12) months prior to the expiration of the then current term of this Lease. Each Renewal Option shall be exercised by Tenant by delivery of an Option Notice to Landlord stating that Tenant is exercising the Renewal Option. If Tenant fails to give such Option Notice in writing to Landlord within the time period specified herein, all rights and privileges granted to Tenant to extend this Lease shall lapse and become null and void. No later option may be exercised if Tenant fails to exercise a prior option, Fixed Rent due in the first Lease Year of the Extension Term and each subsequent Lease Year during the Extension Term thereafter 'shall be calculated pursuant to the terms and provisions of Section 4,1&b). 3.3 4. The Commencement Date shall be Apiil 16, 2016. Rental Pavments; Kev Monev. 4.1 For each and every month of the Lease Term, Tenant agrees to pay as Rent for the Leased Premises, the following sums, on the first day of each month, as follows. Any Monthly Rent (hereinafter defined) received by Landlord, after notice by Landlord to Tenant that such Monthly Rent payment has not been received, on the seventh (7") day or later of the month when due shall be considered late anc subject to a five percent (5%) penalty due at the time of payment. As of the Commencement Date and until April 30, 2017, Tenant (a) shall pay $ 450 per month per bed (the "Rent" or "Monthly Rent" ). Payment for the first month's rent shall be prorated based on the number of days the Tenant leases the Leased Premises hereunder. On October 16, 2016, Tenant shall pay the last month's rent due (b) under this Lease in the amount of twenty-four thousand three hundred dollars ($ 24,300.00), which Landlord shall accept as payment in full of the last month's rent, despite any rent increases which may occur during the Term of the Lease. Commencing May I, 2017, and on each May I annually thereafter (c) during the Lease Term including the Extension Term(s), the then current Monthly Rent shall be increased by three percent (3 lo) per year, 4.2 If and so often as the number of licensed beds increases or decreases during the term of this Lease, effective as of the date of each such increase or decrease, then currem Monthly Rrait (as the same may have previously increased under this Lease, whether as a result of any prior increase in licensed beds or otherivise) shall be increased or decreased according to the increase or decrease in licensed beds. The increases in Monthly Rent contemplated by this Section 4.2 shall be in addition to and not in lieu of the 3 7o aimual rent increases. 4.3 Tenant hereby agrees that if Tenant fails to pay Rent or any other sum required to be paid by Tenant hereunder within the seven-day grace period for any (2) two consecutive months, or for any three (3) months during a Lease Year, Rent hereunder for the remaining Lease Term shall be automatically adjusted to be quarterly rental, payable in advance, commencing on the first (I") day of the month following such consecutive late month, or the third (3" ) late month in a Lease Year quarter, and continuing thereafter for the remaining Lease Term on a quarterly basis in advance, 4.4 Dov Jacobs and Miriam Taub will personally guarantee the payment of Rent, all triple net charges, and all other obligations under the Lease. As approved as to form and content by the Landlord and appears as KxHiutt C, attached hereto. Tenant shall be solely responsible for all general and special real estate taxes and assessments (together with any excis- taxes on such real estate taxes and assessments levied or imposed by any governmental taxing authority), fire district taxes, liens, impositions, including capital stocl&, fianchise, ad valorem, sales, use, bed taxes; personal property laxes, assessments including assessments for public improvements or benefits, whether or not commenced or completed prior to the date hereof and whether or not to be completed within the Term; ground rents; water, sewer and other utility levies and charges; excise tax levies; fees including license, permit, inspection, authorization and similar lees; and all other governmental charges, in each case whether general or special, ordinary or extraordinary, or foreseen or unforeseen, of every character in respect of the Leased Premises, and all interest and penalties thereon attributable to any failure in payment by Tenant which at any time prior to, during or in respect of the Term hereof may be assessed or imposed on or in respect of or be a lien upon the Leased Premises (collectively, the "Imnositions") that accrue from the Commencement Date through the Term. 4.5 Tenant agrees to furnish to Landlord within thirty (30) days after the written request of Landlord, official receipts of ihe appropriate taxing authority or other proof of satisfactory to Landlord evidencing the payment thereof. 4.6 e 4.7 All taxes or assessments payable by Tenant pursuant to the terms and provisions of this section shall be prorated as of the last real property tax year(s) of the Lease Term. After the Commencement Date Tenant shall pay all taxes or assessnients as they become due, 4.8 Tenant shall have ihe absolute right to appeal any Impositions of any Governmental Authority through a tax certiorari or other lawful appeal process at Tenanl.'s expense, Landlord shall not be required to join in any such proceeding unless it shall be necessary for it to do so in order to properly prosecute such proceeding. 4,9 f.lilt 4.10 All rental and other payments shall be made to Landlord at the address designated by Landlord, which may be changed by Landlord upon written notice to Tenant, at any . The terms "rent," "rental" "Additional Rent" and "monthly rent" as used in this Lease shall be deemed to mean all mininmm Monthly Rent, rental adjustments, Impositions and any and all other sums, however designated, required to be paid by Tenant hereunder, whether payable to Landlord or third parties. 4.11 4,12 Any taxes or impositions which may have been prepaid by Landlord shall be prorated between Landlord and Tenant within thirty (30) days of the Commencement Date. 4,13 Tenant shall pay in full: (a) prior in each case to the date when penalties would attach, all Impositions, except only those so long as and io the extent that the same shall be contested in good faith by appropriate and timely proceedings and for which adequate reserves have been established in accordance with practices consistent with the sl&illed nursing facility industry, provided that (i) no default of this Lease has occurred and remains uncured, beyond all applicable cure periods, (ii) such proceeding shall suspend the collection of such Impositions or the Impositions shall have been paid, (iii) such proceeding shall be permitted under and be conducted in accordance with the provisions of miy other instrument to which Tenant is subject and shall not constitute a default thereunder, (iv) no part of or interest in the Leased Premises shall be in danger of being sold, forfeited, terminated, canceled or lost, (v) Tenant shall have furnished such seciuity as may be required in the proceeding, to insure the payment ol'any such Impositions, and (vi) Tenant shall promptly upon final determination thereof pay the amount of such Impositions, together with all costs, interest and penalties; (b) all of Tenant's wage obligations to Tenant's employees in compliance with the Fair Labor Standards Act (29 U,S,C, (tj 206-207) or any comparable provisions; and (c) all obligations validly owed in connection with any claim, demand or notice of any overpayment received from Medicare, Medi-Cal or other third party payor. 4.14 Tenant shall have the sight, but not the obligation, to offset the amount of any Offset Obligation (as defined below) of Landlord and/or Prior Tenant against amounts otherwise due pursuant io Landlord under this Lease (" Right of Offset" ). An "Offset Obligation" shall mean: (i) (for the entire term of the lease including renewals) any tax obligation of Landlord (other than Tenant's obligations to pay taxes and Impositions pursuant io ibis lease); and (ii) (for the first twelve (12) months of the Lease) any obligations of Par Operations, Inc,, a California corporation or other prior operators of the Facility for any overpayment, recoupment or takeback by any Governmental Authority or third party payor as related to dates of service prior to the Commencement Date, Should Tenant receive notice ol'an Offset Obligation, Tenant shall provide notice to Landlord of such Offset Obligation and Landlord shall have seven (7) calendar days to provide Tenant with proof of payment of such Offset Obligation. Should Landlord fail to provide adequate proof of payment of such Offset Obligation then within seven (7) calendar days, Tenant may exercise its Right of Offset and may offset as much as the entire amount of the next month's rent, Should the amount of the Offset Obligation exceed the total amount of rent owed to Landlord for the next tnonth's rent, the Right ol'Offset shall continue indefinitely for future rent paymenis until the entire Offset Obligation lias been satisfied ancl paid in full, Tenant's Right of Offset shall not be Tenant's exclusive remedy by which to seek indemnification under this Lease or the MOTA, nor shall such Right of Offset be considered a waiver of any other remedy available to Tenant pursuant to applicable law. If Tenant shall exercise this Right of Offset, Tenant shall not be precluded from making claims for payment pursuant to this Lease or the MOTA. Tenant may exercise the Right of Offset to offset the entire amotuit of each monthly payment due to Landlord and/or any other payments due to Landlord. The filing of any voluntary or involuntary petition for bankruptcy or any other insolvency proceeding by Landlord and/or Prior Tenant shall not affect the enforceability of the Rights of Offset. 4.15 In consideration of ihe Landlord's grant of this Lease and the extended business opportunity to be afforded the Tenant as a result thereof, Tenant agrees to pay Landlord the principal sum of Two Hundred Twenty-Five Thousand and 00/100 Dollars ($ 225,000.00) (the "I&ev Monev"), over and above the Rent. Such Key Money shall be paid to Landlord upon the execution of this Lease. 5. Use and Control of Premises. The Leased Prnnises may be used by Tenant for the purpose of operating a skilled nursing facility (a "SNF") or nursing home in accordance with the current licenses and certiftcations therefor, and for related and or additional purposes, whether necessary or incidental to such uses, including, but not limited to., the addition of services under the current license, and/or additional licensure. 5.1 Tenant covenants and agrees that ii v,'ill not use Ihe Leased Premises, nor permit the Leased Premises to be used, in whole or in part, for any purpose or use in material violation of any of the law, ordinances, regulations or rules of any public authority at any time applicable thereto. Tenant shall neither use nor permit to be used the Premises or the Facility, or other improvements or any part thereof for ary purpose or purposes other than as a 54-bed SNF, with the current bed conliguration, and I'r no other purpose whatsoever, without the express written consent of Landlord first having been obtained, In no event may Tenant, change the existing "classification" of beds to a lower classification (e.g,, reclassify skilled mirsing beds to intermediate care beds), change the existing classification of beds to a higher classification, or increase or decrease the number of beds in the Faciliny, without Landlord's prior written consent, which consent may not be unreasonably witltheld, conditioned, or delayed. Should any of ihe Room Size Waivers be terminated, revoked or not renev'ed, resulting in a loss of any licensed 5.2 beds, the then current rent shall be reduced by the number of beds lost due to such termination, revocation or non-renewal of any Room Size Waiver, 5.3 Tenant shall, at its own cost, and without expense to Landlord, keep and maintain the Premises, and every part thereof, including, but not limited to, the roof, exterior, interior, foundation, structural pans, operational parts, paving, landscaping, sidewalks, buildings, surface parking lots, sewers, utility lines, and other improvements of any kind which may be a part thereof, in very good, sanitary and neat order, condition and repair, and free from hazards, including replacements as needed, and shall keep the interior in an upgraded condition, at Tenant' sole cost and expense, and except as specifically provided herein, restore and rehabilitate any improvements of any kind which may be destroyed or damaged by fire, casualty or any cause whatsoever, in such a manner as may be necessary to operate the Facility in accordance with applicable state and federal laws and regulations. Tenant shall also maintain the grounds in a good and sightly appearance, including regular inowing, pruning, fertilizing, and other appropriate care of all grass, plants, and trees. Tenant shall promptly replace dead plants and shall maintain the extent of landscaping at least to the level as exists on the Commencement Date. Landlord shall not be obligated to mal&e or bear the cost of any repairs, replabements or renewals of any kind, nature or description whatsoever to the Premises, the Facility, or other improvetnents thereon. Tenant expressly waives the benefit of any law., whether by statute, judicial decision, ordinance, or otherwise, now or hereafter in effect, that would otherwise accord Tenant the right to maize repairs at Landlord's expense or to terminate this Lease because of Landlord's failure to keep the Premises or any portion thereof in good order, condition, or repair. If any Mortgage I-Iolder requires deposits of maintenance costs to be made with such Mortgage Holder, Tenant shall either pay to Landlord monthly the amounts required and Landlord shall transfer such amounts to each Mortgage Holder, or, pursuant io written direction by Landlord, Tenant shall make such deposits directly with such Mortgage Holder, Tenant shall also be solely responsible for making all changes required during the life safety surveys and any other required repairs as stated by OSHPD. Such repairs shall be made in compliance with OSHPD requirements and Tenant shall, when obligated by OSHPD requirements, obtain OSIIPD approval for all such repairs. Landlord shall be permitted, once per calendar year, to inspect the Leased Premises with regard to upkeep and repairs. Landlord will prepare an itemized list of items it wishes Tenant to repair, update and/or replace (the "Proposed Repairs" ) and Landlord and Tenant shall meet and confer regarding such repairs and will reasonably worl& io agree on which Proposed Repairs will be performed by Tenant. 5.4 Tenant shall have the right during the Term, without the consent of Landlord, to make such non-structural interior alterations, changes and improvements to the Leased Premises as may be proper and necessary for the conduct of Tenant's business, to cause the Leased Premises to conform to all Laws, for patient comfort and sal'ety, or for the full beneficial use of the Leased Premises, so long as such improvements, (i) do not interfere with any of the purposes for which the Facility was leased, (ii) do noi decrease the value of the Leased Premises, or (iii) such non-structural alterations can be removed at the end of the term of the Lease ai Landlord's request and at Tenant's cost, without material damage to the Leased Premises. Tenant shall pay for all costs, fines and penalties imposed by the applicable state agencies or Center for Medicare and Medi-Cal Services ("CMS") or other Governmental Authority in connection with any change of ownership survey which are not related to issues beginning and/or arising prior to the Commencement Date. Tenant shall notify Landlord of any alterations, changes or improvements required by any Governmental Authority prior to the commencement thereof, Tenant shall give Landlord written notice ten (10) days prior to commencing repairs, construction, or alterations whose costs exceed Twenty-Five Thousand Dollars ($ 25,000.00) to allow Landlord to post notices of non-responsibility, 5.5 Tenant agrees to return to Landlord upon the expiration of this Lease, the Leased Premises and Leased Assets, Landlord and Tenant acknowleclge that ihe Leased Premises, was, and at all times under the terms of this Lease are, the sole and absolute property of Landlord, Upon any termination of this Lease, Landlord shall have the sole, complete, unilateral, absolute and unfettered right to cause the Facility's licenses to be reissued in Landlord's name or in the name of Landlord's designee upon application therefor to the applicable state licensing authority and to further have the right to have any and all Medicare, Medi-Cal and any other provider and/or third party payor agreements issued in Landlord's name or in the name of Landlord's designee. In the event Landlord exercises its rights pursuant to this Section 5.6, Tenant shall cooperate with Landlord in transferring ihe aforementioned items to Landlord's name or for the benefit of Landlord or as Landlord may direct, together with all patient records, and such other books and records relating to the Facility's operations as Landlord or its designee may require io operate the Facility as a 95-bed skilled nursing facility, subject to indemnification for the use of such license, certification and related provider agreements during such transition period, Tenant shall use its best efforts to maintain the number of beds at the Facility and to maintain the room size waivers in place at the Facility on the Commencement Date and shall notify Landlord if Tenant receives any notice that such room size waivers are being revoked or denied, but in the event CDPI-I denies any room size waivers and reduces the number of beds Tenant shall not be held in default of this Lease. All improvements and additions made by Tenant to the Leased Premises which are permanently affixed to the building located thereon shall be deemed to be a part of the building and Leased Premises, and itttntediately become the property of Landlord 5.6 6. Materials and Hazardous Waste. 6,1 Tenant shall not place or hold any Hazardous Materials on or at the Leased Premises, except as is necessary for the ordinary course of its business as a SNF. If Tenant' business requires the use of any Hazardous Xfaterials, other than such materials as are typically found in skilled ntusing facilities, Tenant shall notify Landlord in writing and shall comply with hazard communication and not.ification requirements of the Occupational Safety and I-Iealth Act ("OSHA") and all laws which require noidfication of employees, the community or any governmental agency of the hazardous properties of'such Hazardous Materials. Tenant shall noi place, hold or dispose of any Hazardous Wasie on, under or at the I.eased Premises except as specifically allowed in this Section 6.2. Tenant further agrees that it shall not use the Leased Premises as a treatment, storag&e, or disposal (whether permanent or temporary) facility for Hazardous Waste except in the ordinary course of operating the I acility and in compliance with all Environmental Laws. If Tenant, in the ordinary course of its business as a SNF generates Hazardous Waste, then Tenant shall comply with all applicable federal, state and local laws, statutes, ordinances, codes, rules, regulations, orders or decrees relating to the appropriate use, storage, transportation arid disposal of I-Iazardous Waste. For the purposes of this Lease, "I-lazardous Waste" means and includes any hazardous material that has entered the waste 6.2 stream or any contaminant or pollutant as defined as such in the Resource Conservation and Recovery Act, the CERCLA, as amended. any so-called "Superfund" or "Superlien" law, the TSCA, or any other Law, relating to or imposing liability or standards of conduct concerning, any hazardous, toxic or dangerous waste. Tenart shall have no liability for any such losses, liabilities, damages, injuries, costs, expenses or claiins asserted or arising under the CERCLA, as amended, any so-called "Superfund" or "Superlien" law, or any other Law, relating to or imposing liability or standards of conduct concerning, any Hazardous Material, condition, omission or which arise due to any violation of Enviromnental Law pre-dating the Commencement Date. Tenant further agrees that it shall properly dispose of all "infectious waste" such as laboratory waste, pathological waste, blood specimens or products, patient or resident waste, including, without limitation, bandages and disposable gowns, sharp waste and any material generated by the production or testing of biological agents, Immediately upon receipt of any Environmental Notice (as hereinafter defined) fiom any Person, Tenant shall deliver to Landlord a true, correct and complete copy of same. "Environmental Notice" shall mean any note, notice, or report of any suit, proceeding, investigation, order, consent order, injunction, writ, award, or action related to or affecting or indicating the treatment, storage, handling, disposal, generation, spill, release or discharge of any Hazardous Waste or Hazardous Materials in or affecting the Leased Premises. 6.3 Upon the expiration of the Term, or the earlier termination thereof, whichever shall be the first to occur, Tenant shall forthwith remove all Hazardous Materials and Hazardous Waste caused, placed or released on, at or under the Leased Premises or any portion thereof in accordance with applicable Lav. (excluding consumable supplies typically used in the operation of a skilled nursing facility). Landlord shall have the right to inspect the Leased Premises with regard to the management and disposal of Hazardous Materials and Hazardous Waste at all reasonable times during the Term. 7. Utilities. Tenant agrees io pay, or cause to be paid, all charges against the Leased Premises for gas, water, sewer, electricity, light, heat or power, telephone and all other utilities used, rendered or supplied upon or in connection with the Leased Premises through the Lease Term commencing with the date Tenant enters into possession, and to indemnify Landlord and to save them harmless against any liability or damages on such account. 7.1 8. Insurance. 8.1 At all times during this Lease, at its own cost and expense, Tenant shall all I&eep buildings, improvements and Inventory existing or hereinafter erected or added as a part of the Leased Premises, including all alterations, rebuilding, replacements and additions thereto, insured against loss or damages by fire, and such other hazards, casualties, risks and contingencies that may hereafter be considered as included within the standard form fire insurance policy with extended coverage endorsement, in an amount equal to one hundred percent (100Ni of the full replacement value thereof, The carriers of all policies shall have a Best's Rating of "A-" or better. All said policies of insurance shall be written on an occurrence or claims-made form. Tenant shall not be permitted to provide self-insurance and all such insurance must be obtained from a third party insurer, 8,2 The term "full replacement value" shall mean actual replacemem cost exclusive of cost of excavation, foundations and footings, 8.3 At all times during this Lease, at its own cost and expense, Tenant shall provide and keep in force single limit comprehensive general liability insurance policies, in standard form, protecting Landlord and Tenant against any and all liability in an amount of not less than One Million Dollars ($ 1,000,000.00) per occurrence and Three Million Dollars ($ 3,000,000,00) in the aggregate. Tenant shall also maintain workers'ompensation insurance meeting all statutory and regulatory limits. If'ither party shall at any time believe the limits of insurance required hereunder to be excessive or insufficient, the parties shall endeavor to agree in writing on the proper reasonable limits for such insurance and such insurance shall thereafter be carried with the limits as agreed on until further changed pursuant to the provisions of this Section. If the parties shall be unable to agree thereon, the proper reasonable limits for such insurance to be carried shall be determined as described in Section 8.4. 8.4 If Landlord and Tenant caniiot agi'ee on the terms of insqrance provided for hereunder, Landlord and Tenant shall each select an insurance broker. If they cannot agree on the proper reasonable limits for such insurance, then they in turn shall select an impartial third broker who shall determine the reasonable limits of insurance coverage. Such third party shall, in rendering its decision, bear in mind the insurance market conditions, availability of insurance and premium costs for such coverage for the long term care industiy in the State of California and what is reasonably and commercially available for the Tenant. All such policies shall cover the entire Leased Premises, includiiig parking and common areas therein, and sidewalks adj acent thereto, 8.5 All such insurance to be provided by Tenant under this section shall name as an additional insured the Landlord and or Landlord's Mortgage Ilolder (except and Tenant as their respective interests may appear, and Tenant shall provide certificates of all such insurance to Landlord. In addition, all policies of insurance of the kind described in Section 8.1 shall provide for payment of loss to (i) the Landlord and the Tenant as their interests may appear, in the case of any particular casualty resulting in damage or destruction to the Leased Premises exceeding $ 150,000.00, and (ii) Tenant in the case of any such workers'ompensation) particular casualty resulting in damage or destruction not exceeding $ 150,000.00. 8.6 All net insurance proceeds received by or on account of Landlord, Tenant or the beneficiary, if any, or any deed of trust on the Leased Premises, as the case may under the policies of insttrance of'he kind described in Section 8.1 shall be held in trust by recipient thereof, who shall administer and apply such proceeds in accordance with provisions of Section 11 hereof. the be, thc the 8,7 All of the policies of insurance provided for in this Lease shall be in form and substance as is then standard in the State of California for policies of lil&e coverage and shall be distributed in such amount, and by such responsible companies as Landlord shall reasonably approve. 10 In the event that Tenant fails to obtain and maintain insurance as in this Lease provided, Landlord may ef'feet any such insurance coverage and pay premiums therefore, and all premiums so paid by Landlord shall be payable by Tenant to Landlord. 8.8 8.9 The obligation of collecting upon the insurance policies furnished and provided for by Tenant, or obtained by Landlord by reason of the failure of Tenant to obtain them, shall be Tenant', but Landlord shall cooperate in such collection (but at the expense of Tenant if any expense is incurred} to such reasonable degree as may be requested by Tenant. 9, Mechanic's Lien. 9.1 Tenant shall not suffer or permit any mechanic's liens to be filed against the Leased Premises or any part thereof by reason of work, labor, services, or material supplied or claimed to have been supplied by Tenant or anyone holding the Leased Premises, or any part thereof, through or under Tenant, If'ny such mechanic's lien should at any time be filed against the Leased Premises, Tenant shall cause the same to be discharged of record within thirty (30) days after the date of filing the same. If Tenant shall fail to discharge such mechanic's lien within such period, then Landlord tray, but shall not be obligated to, discharge the same either by paying the amount claimed to be due or by procuring the discharge of such lien by deposit in court or by giving security, or in such other maimer as is or may be prescribed by law. Any amount paid by Landlord for any of the aforesaid purposes in procuring the discharge of such lien, with all necessary disbursements in connection therewith, shall be repaid by Tenant to Landlord on demand, and if unpaid, may be treated as Additional Rent. Nothing herein contained shall imply any consent or agreement on the part of Landlord to subject Landlord's estate to liability under any mechanic's lien law. 9,2 If the Tenant shall desire to contest any claim or lien, it shall furnish the Landlord adequate security of the value or in the amount of the claim, plus estimated costs and interests, or a bond of a responsible corporate surety authorized to do business in the State of California, in such amount, conditioned on the discharge of the lien. If a final judgment establishing the validity or existence of a lien for any amount is entered, the Tenant shall pay and satisfy the same at once. 10. Indemnification/Offsets. Tenant agrees to indemnify, defend and save harmless Landlord and its members, managers, officers, directors, owners, employees, representatives and agents against and from any and all claims which arise as a result of the Tenant's actions, inactions, negligence or conduct and that arises during the Lease Term, that is brought by and on behalf of any person, arising from the conduct or management of or from any work or thing whatsoever done in or about the Leased Premises by or on behalf of Tenant, and will fiirther indemnify, defend and save Landlord and its members, managers, olTicers, directors, owners, employees, representatives and agents harmless against and from any and all claims by or on behalf of any person arising during the Lease Term which relates to events or acts which occurred during the Lease Term by Tenant from any condition of the building on the Leased Premises or any sidewalk adjoining the Leased Premises, or any passageways or spaces therein or appurtenant thereto, or arising fiom any breach or default on the pari. of Tenant in the performance of any 10.1 covenant or agreement ol'enant to be performed pursuant to the terms of this Lease, or arising from any act of negligence of Tenant., or of any of its agents, contractors, servants, employees, sub-tenants, or licensees, or arising from any accident, injury, or damage whatsoever caused to any person occurring after the Commencement Date of this Lease in or about the Leased Premises, or upon or under the sidewalks and the land adjacent thereto, and fiom and against all costs, counsel fees, expenses and liabilities incurred in or about any such claim or action or proceeding brought against Landlord and iis trustees, representatives and agents by reason of any such claim, Tenant upon notice from Landlord covenants to resist or defend such action or proceeding. This indemnity shall not extend to injury caused by Landlord, its agents, representatives or employees. 10.2 Landlord and Landlord's principal, Arlene Rosales, agree to indemnify, defend and save harmless Tenant and its members, managers, officers, directors, owners, employees, representatives and agents against and from any and all claims which arise as a result of Landlord's actions, inactions, negligence or conduct and that arises during the Lease Term, that is brought by and on behalf of any person, arising from the conduct or management of or from any worlc or thing whatsoever done in or about the Leased Premises by or on behalf of Landlord, and will further indemnify, defend and save Tenant and its members, managers, officers, directors, owners, employees, representatives and agents harmless against and from any and all claims by or on behalf of any person arising during the Lease Term which relates to the Offset Obligations and any events or acts v hich occurred prior to the Lease Term by Landlord or any tenant of Landlord, including, but not limited to Prior Tenant, fiom any condition of the building on the Leased Premises or any sidewalk adjoining the Leased Premises, or any passageways or spaces therein or appurtenant thereto, or arising fiom any breach or default on the part of Landlord in the performance oi any covenant or agreement of Landlord to be performed pursuant to the terms of this Lease, or arising from any act of negligence of Landlord, or of any of its agents, contractors, servants, employees, sub-tenants, or licensees, or arising from any accident, injury, or damage v'hatsoever caused to any person occurring prior to the Commencement Date of this Lease in or about the Leased Premises, or upon or under the sidewalks and the land adjacent thereto, and from and against all costs, counsel fees, expenses and liabilities incurred in or about any such claim or action or proceeding brought against Tenant and its trustees, representatives and agents by reason of any such claim, and Landlord, upon notice from Tenant, covenants to resist or defend such action or proceeding. This indemnity shall not extend to injury caused by Tenant, its agents, representatives or employees or to any Quality Assurance Fees (the "QA Fees" ) imposed on Prior Tenant, which Tenant is otherwise assuming. For purposes of this Article 10 the term "person" shall mean any natural person, corporation, limited liability company, professional association, limited partnership, general partnership, joint stock company, joint venture, association, company, trust, bank, trust company, land trust, business trust or other organization, whether or not a legal entity, and/or any Governmental Authority. 11, Damaue or Destruction. 11.1 If during the Lease Term the buildings or improvements on, in or appurtenant to the Leased Premises, or thereafter erected, installed or placed thereon or therein, 12 shall be destroyed or damaged in whole or in part by fire or other hazard, risk, contingency or casualty, whether or not covered by insurance pursuant to Section 8,1 hereof, or after partial condenmal.ion not resulting in termination of this Lease, Tenant shall give to Landlord immediate notice thereof, and Tenant shall promptly repair, replace and rebuild the same, at least to the extent of the value, quality and class equal to the building improvements existing immediately prior to such occurrence (hereinafter referred to as "Restoration" ), all in accordance with Section 13.1 hereof, provided Tenant has access to the insurance coverage provided herein, Notwithstanding anything herein to the contrary, in the event that the damage or the destruction is a result of a casualty not covered by insurance, Tenant shall have the obligation to repair or restore the Leased Premises. If such destruction or injury reduces by fifty percent (50'ro), or more, the number of licensed and certified beds as licensed on the Commencement Date, then upon written notice by one. party to the other, either Landlord or Tenant may terminate this Lease, unless such damage or destruction was caused by Tenant's negligent or willful malfeasance (in which event., Tenant shall be obligated to repair or construct the Leased Premises), Tenant shall be released from any further liability hereunder thereafter accruing with respect to the Facility, except as otherwise expressly provided in this Lease, If Tenant shall not so terminate this Lease, then Tenant shall repair or reconstruct the Leased Premises in substantially the same condition as just prior to the incident and consistent will all applicable Laws in effect at the time of the repair or reconstruction, and with the proceeds of the property casualty insurance carried by Tenant as required hereunder, and Landlord shall make such insurance proceeds available to Tenant for such purpose, All such repairs and reconstruction shall be undertaken and completed in accordance with applicable Law. 11.2 In the event of any damage or destruction as hereinabove referred to, any insurance money received by or paid to the Landlord, Tenant or beneficiary, if any, of any deed of trust on the Leased Premises by reason thereof shall be applied to such costs of repairing, restoration, or rebuilding as herein provided for and required pursuant to Section 13,1 hereol; unless this Lease is terminated as provided herein. To the extent that any insurance proceeds are in excess of the cost of repair or restoration, Landlord shall be entitled io retain such excess insurance proceeds. 12. Condemnation. 12.1 If title to the fee of the whole of the Leased Premises shall be tal&en or condemned by any competent authority for any public or quasi-public use, this Lease shall cease and terminate as of the date of vesting of title in said authority. If title to the fee of less than the whole of the Leased Premises, but more than fiAy percent (503'o) of the licensed bed capacity of the Leased Premises shall be so taken or condemned, Tenant shall have the option by written notice to Landlord to terminate this Lease as of the date of vesting of title in said authority to the portion of the Leased Pren'ises so taken or condenmed. Upon the exercise of such option, this Lease shall cease and terminate as to such portion. In either of such events, all annual rental shall be apportioned as of the date the Lease shall have been so terminated as aforesaid. The total condtannation award made with respect to any such taking shall be apportioned between the Landlord and Tenant in accordance with iheir respective interests in the Leased Premises immediately prior io such condemnation or taking. Including but noi 12.2 13 limited to Tenant's right to any compensation fiom the condemning authority for diminution in value of the leasehold, loss or daiiiage to Tenant's personal property, Tenant's loss of business during the remaining Lease Terni, Tenant's removal and relocation expenses or the depopulation expenses incurred by Tenant m connection with transferring the residents to other SNFs. If title to the fee of less than fifty percent(50%) of the licensed bed capacity of the Leased Premises shall be so taken or condemned, or if Tenant shall be so entitled, but shall 12.3 not elect to terminate this Lease as provided for in Section 12.1 hereof, Tenant shall restore the undertaken portion of any building or improvements on the Leased Premises so that such building shall constitute a complete architectural unit of the same general character and condition (as nearly as may be possible under the circumstances) as the building and improvements existing immediately prior to such condemnation or taking, For the purpose of contributing to the cost of such restoration work, Landlord upon receipt of the award made in such condemnation proceeding, shall, out of such award, make payment to Tenant in accordance with the provisions of Section 13 hereof. From and after the date of the last of such payments by Landlord to Tenant, the annual rent payable by Tena!it hereunder shall be reduced by an amount which bears the same ratio to such annual rental as the amount of the entire award, including compensation, damages, and interest, if any, made with respect to the portion of the Leased Premises so taken or condemned (including any severance damages), bears to the value of the Leased Premises immediately prior to the taking or condemnation, as such value is determined in said condemnation proceedings. 13. Restoration. The terms and conditions upon which any buildings or other improvements on the Leased Premises slta11 be restored as aforesaid by Tenant, and the terms and conditions upon which the net proceeds of insurance of the kind described in Section 8.1, as well as the net award in condemnation described in Section 12,3, which are held in trust by the recipient thereof as hereinbefore provided, shall be applied to the cost of such restoration, are as follows: 13,1 Tenant shall submit to Landlord complete plans and specifications (a) in compliance with the then existing licensing requirements, which shall be designated: if restoration is occasioned by fire or other casualty (except (I) partial condemnation), to restore the building at least to its condition immediately prior to such damage or destruction and as nearly as similar in character as is practicable and reasonable; if the restoration is occasioned by partial condemnation, to (2) construct the remainder of the building so that the building shall constitute a complete architectural unit of the same general character and condition (as nearly as may be possible under the circumstances) as the building existing immediately prior to such commendation or taking. The plans and specifications shall be subject to the approval of Landlord and approval shall not be unreasonably withheld, Within fitteen (15) calendar days atter submission thereof, Landlord shall either approve the same or serve written notice upon Tenant of its disapproval thereof and its objections thereto, in default of which such plans and specifications or such portion thereof not objected to shall be deemed to be approved by Landlord, anything herein contained to the contrary notwithstanding. (b) work under this Section 13.1, Tenant shall obtain consent of Landlord prior to commencing any Tenant shall thereafter furnish the recipient of the proceeds of (c) insurance or the award in condemnation, as the case may be, with a copy of any contract or contracts which Tenant shall enter into for the making of such restoration; or, if the restoration is to be done by Tenant, a copy of all subcontracts made by Tenant in connection with such restoration, and an estimate of the cost thereof, During the progress of the restoration, the holder of the insurance proceeds or award in condemnation, as the case may be, shall malce payments to Tenant or to the contractors and materialmen of Tenant, for the account of Tenant, out of such proceeds of insurance or award in condemnation to the extent available. (d) At the completion of the restoration and following the (e) disbursement of the final advance to Tenant required to complete the payment of restoration costs, any such insurance proceeds or condemnation award proceeds remaining shall be paid by the recipient thereof to Landlord and credited to the rental required to be paid by Tenant pursuant hereto during the year in which such payment is made. Landlord shall have the right, at its sole option and expense, to inspect or audit the records of Tenant relating to the restoration. During such restoration, Landlord and any architect, engineer, or (I) other representative designated by Landlord, may inspect the building in the course of such restoration. Tenant shall keep copies of all plans, shop drawings and specifications relating to such restoration on the building site and permit Landlord or its architect, engineer, or other representative to examine them at all reasonable times, or in the alternative, shall furnish Landlord with copies of such plans, drawings and specifications. In the event that during the restoration of the building, Lancilord or its architect, engineer or other representative shall reasonably determine that the materials do not substantially conform to the approved specifications or that the building is not being restored in accordance with the approved plans, or that prior certificates fiom Tenant were in error, prompt notice in writing shall be given to Tenant, specifying in detail the particular deficiency, omission or other respect in which it is claimed that the restoration does not conform with the plans and specifications as so approved. Upon receipt of any such notice, Tenant shall tal&e such steps as it deems necessary to cause corrections to be made as to any deficiencies, omissions or otherwise, and if necessary for the purpose of effectuating such corrections, shall innnediately remove such materials and replace such construction and furnish materials in accordance with materials equally as good as those provided for in such plans and specifications. 15 (g) If Tenant shall fail to commence such restoration within ninety (90) days of such damage or destruction, or having commenced such restoration shall fail to complete it in accordance with the provisions of this Lease with reasonable diligence, Landlord may, at its option and upon serving written notice upon Tenant that it elects to do so, mal&e and complete such restoration. In such event, Landlord shall have the right, as the restoration progresses, to use and apply the insurance proceeds or condenutation award money to the cost of such restoration to the extent that it shall not theretofore have been applied to the payment or reimbursement of costs and expenses of Tenant as aforesaid. If prior to the completion of such restoration whether by Landlord or Tenant, this Lease shall terminate or expire for any reason, Landlord shall have the right to receive and retain such insurance proceeds or condemnation award, to the extent that it shall not theretofore have been applied to the payment or reimbursement of the costs and expenses of Tenant and Landlord, as aforesaid and Tenant shall thereupon be discharged from any and all obligations under this Lease, with respect to such restoration. 14. Landlord's Entrv Riuhts. 14.1 Subject to Landlord's compliance with all applicable laws, rules and regulations relating to protecting the patient's privacy, Tenant shall permit Landlord and the authorized representatives of Landlord to enter the Leased Premises at all reasonable times for the purpose of determining whether the Premises are in good condition and whether Tenant is complying with its obligations under this lease; serving, posting or keeping posted thereon notices provided by any law of the State of California or which may be reasonably necessary or appropriate for the protection of Landlord or its interest, for the purpose of inspecting same; to post "for rent" or "for lease" signs during the last six (6) months of the term, or during any period while Lessee is in default; to show the Premises to prospective brokers, agents, buyers, Tenants, or persons interested in an exchange, at any time during the term; and for the purpose of making any necessary repairs to the Leased Premises and performing any work that may be necessary to comply with the laws, ordinances, rules, regulations or requirements of any public authority or any applicable standards that may from time to be time be established by the National Board of Fire Underwriters, the National Fire Protection Association, or any similar bodies, or that Landlord may deem necessary to prevent waste, loss, damage or deterioration to or in connection with the Leased Premises. Landlord shall not in any event be liable for inconvenience, annoyance, disturbance, loss of business or other damage of Tenant by reason of making repairs or the performance of any work in the Leased Premises, or on account of bringing materials, supplies and equipment into or through the Leased Premises during the course thereof, and the obligations and responsibilities of Tenant under this Lease shall not thereby be affected in any manner whatsoever. Landlord shall, however, in connection with the doing of any such worl&, cause as little inconvenience, annoyance, disturbance, loss of business or damage to Tenant and its subtenants as may be reasonable possible under the circumstances. 14.2 14.3 Upon notice to Tenant and in coordination with Tenant, Landlord shall have and is hereby given the right to enter the Leased Premises at all reasonable times for the purpose of exhibiting the same to prospective purchasers or encumbrancers. 15. Banlcruntcv and Insolvency. 15.1 If at any time during this Lease, Tenant shall voluntarily file a petition in Bankruptcy or insolvency, or shall file a voluntary petition for reorganization under the banlcruptcy laws of the United States or under any insolvency act of any state, or shall take advantage of any insolvency act by voluntary petition or assignment for the benefit of creditors, other than by permitted merger, consolidation, or reorganization not connected with insolvency or banluuptcy, then and in any such event, Landlord may at its option, serve a written thirty (30) day notice of cancellation and termination of this Lease, and upon the expiration of said thirty (30) days, this Lease shall end and expire by limitation as fully and completely as if the date of expiration or such thirty (30) day period were the day herein definitely fixed for the end and expiration of this Lease. If Tenant shall be placed in involuntary bankruptcy proceedings, or if receiver, trustee, assignee or other similar custodian of Tenant's property shall be appointed, 15.2 a (a) and (b) if the rental payable hereunder shall remain unpaid for a period of thirty (30) days after the event described in subsection (a) above, then and in such event, Landlord may at its option serve a written thirty (30) day notice of cancellation and termination upon Tenant and upon the expiration of said thirty (30) days, this Lease, as well as all right, title and interest ol Tenant hereunder, shall end and expire as fully and completely as of the date of expiration of such thirty (30) day period; provided, however, that the Tenant, or such receiver, trustee, assignee or custodian may during said thirty (30) day period, pay to Landlord such delinquent rent and said thirty (30) day period shall once again commence to run as of the date of payment of such delinquent rent and this Lease shall not expire. Tenant and Landlord agree this is not an executory contract and Tenant shall have no right to reject this Lease in any bankruptcy or insolvency proceeding. For purposes of this Sectio!i 15 only, the reference to "receiver" shall not include a receiver of rents, issues and profits in an action brought to foreclose a mortgage on such leasehold estate. 15.3 15.4 Tenant shall be respoiisible for all of Landlord's reasonable attorney fees and expenses incurred as a result of Tenant's insolvency or bankruptcy proceedings. 16. Defaults. 16.1 In the event that during the Lease Term: (i) Tenant shall default in the payment of any installment of rent or other sums herein specified to be paid by Tenant, such default shall continue for fifteen (15) days after the due date thereof and such default shall not be cured within thirty (30) days af,er Landlord shall have given to Tenant written notice specifying such default or defaults; or (ii) Tenant shall default in the observance or performance of any of Tenant's covenants, agreements or obligations hereunder and such default shall not be cured within thirty (30) days after Landlord shall have given to Tenant written notice specifying such default or defaults; or (iii) in the case of default which cannot be cured within a period of thirly (30) days after receipt of written notice, Tenant shall not have begun proceedings to cure the same, reasonably satisfactory to Landlord, and shall not prosecute the curing of such default, as rapidly as reasonably required by Landlord under the circumstances: 17 Then in any such event Landlord shall have the right, at its election (a) at any time, while such defaults continue, to reenter and take complete and peaceable possession of the Leased Premises, and to either keep this Lease in effect or to declare the Lease Term ended, whereupon this Lease and all the right, title and interest of Tenant hereunder shall terminate and be of no further force and effect. In the event that Landlord shall elect to so terminate this Lease, then Landlord may recover from Tenant; the worth at the time of award of any unpaid rent or other (I) charges which had been earned at the time of such termination; plus the worth at the time of award of the amount by which the (2) unpaid rent and other charges which would have been earned after termination until the time ol'ward exceeds the amount of such rental loss Tenant proves could have been reasonably avoided; plus the v:orth at the tinie of award of the amount by which the (3) unpaid rent and other charges for the balance of the Lease Term after the time of award exceeds the amount of such rental loss that Tenant proves could reasonably be avoided; any other amount necessary to compensate Landlord for (4) all the detriment proximately caused by Tenant's failure to perform its obligation under this Lease or which in the ordinary course of things would be likely to result therefrom including attorneys'ees and costs, and at Landlord's election, such other iunounts in addition to or (5) in lieu of the foregoing as may be permitted fi'om time to time by applicable law, As used in subsections (I) and (2) above, the "worth at the time of award" is computed by allowing interest at the Wells Fargo Bank Priine Rate plus two percent, but in no event greater than ten percent (10%). As used in subsection (3) above, the "worth at the time of award" is computed by discounting such amount at the discount rate of the Federal Reserve Banlr. of Los Angeles at the time of award plus one percent (1N). The amount recoverable by Landlord pursuant to Subsection (4) above shall include., bui is not limited to, any costs or expenses incurred by Landlord in maintaining or preserving the Premises after such default, preparing said Premises for reletting to a new tenant, accomplishing any repairs or alterations to the Premises for the purpose of such reletting, rectilying any damage thereto occasioned by thc act or omission of Tenant, and any other costs reasonably necessary or appropriate to relet the Premises. I,andlord shall further have the right, without declaring this Lease ended, to reenter the Leased Premises attd occupy or Lease the whole or any part thereof for and on account of the Tenant, and upon such terms and conditions and for such rent as the Landlord may deem proper, and t.o collect said rent or any other rent that may thereafter become payable, and apply the same toward the amount due or thereafter to come due from the Tenant, and on account of the expense of such subletting and any other damages sustained by Landlord. Should such rental collected by Landlord be less than the rental payable by Tenant hereunder, the Tenant agrees to pay such deficiency to the Landlord and to pay to the Landlord forthwith upon any such reletting, wilh such deficiency the costs and expenses which Landlord may incur by reason (b) 18 thereof. By way of clarification, Landlord and Tenant agree that Landlord has the remedy described in California Civil Code Section 1951,4 (Landlord may continue the Lease in effect after Tenant's breach and abandonment and ecover rent as it becomes due, if Tenant has the right to sublet or assign, subject only to reasonable limitations). Landlord shall have the right, even though it may have relet the Leased Premises, to thereafter elect to terminate this Lease and all of the right of the Tenant in or to the Leased Premises. 16.2 The following shall also be considered events of default by the Tenant and Tenant shall have the right to cure the event of default as specified and in general after receipt of written notice from the Landlord except as specified: if the leasehold interest of Tenant shall be levied upon under (a) execution or be liened or attached and such levy, lien or attachment is not removed within thirty (30) days of the date Tenant receives notice of it; in the event of a filing by or against Tenant of a petition under (b) federal or state law pertaining to bankruptcy or insolvency or for a reorganization or other reliel; unless, in ihe case of a petition filed against Tenant, the same is dismissed within thirty (30) days; if Tenant is adjudicated as bankrupt or a court of competent jurisdiction shall enter an order or decree appointing, with or without the consent of Tenant, a receiver of Tenani or of the whole or substantially all of its property and is uncured within thirty (c) (30) days; if Tenant makes any general assignment for the benefit of creditors (d) and is uncured within thirty (30) days: if Tenant abandons the Facility comprising the Leased Preniises or (e) if, except as a result of damage, destruction or a partial or complete condemnation, Tenant voluntarily ceases operations of the Facility comprising the Leased Premises, or if Tenant files with any Govermnental Authority, or otherwise adopts a closure plan for the Facility or relinquishes its skilled nursing facility license and Medicare or Medi-Cal provider agreements; if Tenant receives a state or federal notice of termination of license "fast track" de-certification or and such notice has not been suspended, extended, withdrawn or terminated within the time period required by any Governmental Authority; if any of the representations or warranties made by Tenant under this (g) Lease or otherwise proves to be untrue v hen made in any material respect and is uncured within thirty (30) days of ihe date Tenant receives notice of it; II'Tenant shall default in the performance of any covenants required to be 16.3 performed by and under this Lease., Landlord may perform the same for the account and at the expense of Tenant in accordance v;ith the provisions of this Lease. If Landlord at any time is compelled to pay any sum of money or do any act which will require the payment of any sum of money by reason of the failure of Tenant to comply with any provisions of this Lease, or if Landlord is compelled to incur any expense, including reasonable attorneys'ees, in instituting; prosecuting or defending any action or proceeding instituted by reason of any default of Tenant 19 hereunder, the sum or sums so paid by Landlord shall be due Ii'om Tenant to Landlord immediately upon demand of Landlord. In addition to the aforesaid remedies, Landlord shall have all other remedies provided by law. The Landlord shall not be deemed to have terminated this Lease or the liability of the Tenant to pay rent thereafter to accrue, or its liability for damages under any of the provisions hereof by any such reentt~', or by any action in an unlawful detainer or otherwise obtain possession of the Leased Premises, unless the Landlord shall have notified the Tenant in writing that they have so elected to terminate this Lease and the tenancy of the Tenant hereunder. Tenant further covenants that the service by the Landlord of any notice pursuant to the unlawful detainer statutes of the State of California and ihe surrender of possession pursuant to such notice shall not (unless ihe Landlord elects to the contrary ai the time of or at any time subsequent to the service of such notice and such election can be evidenced by a written notice to the Tenant) be deemed to be a termination. of this Lease, In the event of any entry or talcing possession of the Leased Premises as aforesaid, the Landlord shall have the right, but not the obligation, to remove therefrom all or any part of the Tenant's personal property located therein, and may place the same in storage at a public warehouse at the expense and risk of the owner or owners thereof. 16.4 16.5 The remedies given to the Landlord in this Section 16 shall be in addition and supplemental to all other rights and remedies which the Landlord may have under the laws then in force. 16.6 The Landlord shall be in defrnilt of this Lease if the Prior Tenant and Landlord's previous tenant (as well as an affiliate of Landlord) of the Lease Premises causes unreimbursed damages to the Tenant resulting from (i} any repayments or recoupments required by any Govermnental Authority or third party payor for dates prior to this Lease, (ii) any losses incurred as a result of the resurvey by ihe California Department of Health due at the Facility, or (iii) Prior Tenant's failure to timely file and support the cost reports (for dates prior to this Lease) with the appropriate Medicare and Medi-Cal agencies which are required to be filed by law tuader the terms of the Medicare and Medi-Cal progratns and required to be filed and supported by that certain Management and Operations Transfer Agreement dated as of even date herewith between Tenant and Prior Tenant. Tenant shall provide written notice to Liuidlord of such Landlord's default and Landlord shall have thirty (30} days to cure. If Landlord fails to cure ibis default within thirty (30) days Tenant may elect to either (i) exercise its Right of Offset against rent payments due, any losses incurred under this Section 16.6,, or (ii} terminate this Lease with thirty (30) day written notice to Landlord during which thirty (30) day termination period Landlord shall contimie to have the right to cure ibis default. 16.7 Landlord's Default. A breach by Landlord of any of its obligations arising under this Lease shall be an Event of Default hereunder, which, if not cured within thirty (30) days of Tenant's notice of such default to Landlord shall give Tenant the right to terminate the Lease. I'or the avoidance of doubt, a default by Licensee under Section 3.4 of the Management and Operations Transfer Agreement of even date herewith shall not constitute a default of Landlord under this Lease. 17. Surrender Upon Termination. 17.1 Tenant shall, upon the termination of the Lease Term, or any earlier termination of this Lease, surrender to Landlord, the Leased Premises in good condition and repair, reasonable wear and tear excepted. 17.2 Upon the expiration or termination of this Lease, the following provisions shall apply: To the extent not then prohibited by applicable law, unless otherwise (a) directed by Landlord, Tenant shall use reasonable good 1'aith efforts to and for no fee (i) assign to Landlord or Landlord's nominee {or to cooperate with Landlord or Landlord's nominee in connection with the processing by Landlord or Landlord's nominee of any applications) for all Healthcare Licenses, as defined below, then in effect which relate to the operation of the Leased Premises and enter into an interim sublease agreement and interim management agreement or a management and operations transfer agreemenl: (collectively the "MOTA"), which MOTA shall be in form and substance as approved by Landlord and Tenant, in order to permit Landlord or its nominee to operate the Leased Premises under Tenant's Healthcare Licenses and bill for services, until such time as Landlord or its nominee are able to secure the same in their own name, and/or cooperate with Landlord or its nominee in their efforts to secure Healthcare Licenses for which Landlord or its nominee wishes to apply and which may be required by Landlord or Landlord's nominee relating to the ownership and operation of the Leased Premises. Provided, however, that the costs and expenses of any such transfer or the processing of any such application shall be paid by Landlord or Landlord's nominee), and (ii) file all final cost reports, if any, relating to Tenant' operation of the Leased Premises. "Healthcare Licenses" shall mean: all licenses and permits that are required for the Premises to operate as a licensed skilled nursing facility, by the local, state or federal agencies having jurisdiction over any aspect of the operation of the Leased Premises as a licensed skilled nursing facility, including but not limited to: all permits (including building permits), the License and other licenses, certificates {including certificates of occupancy), certificates of need (if applicablc), Medi-Cal and Medicare provider agreements and numbers, submitter identification numbers, Veteran' Administration contracts, and other third party payors, including managed care contracts, and all other governmental approvals, authorizations and entitlements. Tenant acluiov ledges and agrees that to the extent and only to the (b) extent permitted by law, title to {i) any zoning or building approvals, or other governmental approvals other than the I-lealthcare Licenses (the "Approvals" ) which, by their nature, pertain to the Leased Premises, its ownership and its use and occupancy, and (ii) all licenses and permits other than the I-lealthcare Licenses which, by their nature, pertain specifically to the Leased Premises, its ownership and its use and occupancy shall, in every respect, be and remain with the Leased Premises or Landlord, as the case may be, and are not and shall not be the property of Tenant. Tenant shall take no action and shall have no right, power or authority to encumber same except in favor of Landlord and then only to the extent permitted by applicable law or to sell, assign or transfer same to any third person other than Landlord or its nominee in accordance with the provisions of this Lease, either during the Term or upon any termination ol'his Lease, or to use, in any manner which would impair or adversely affect the use of such Approvals with respect to the Leased Premises, such Approvals at any other location. 21 Effective with the issuance of a SNF license by CDPH to Landlord or Landlord's nominee, Tenant shall execute in favor of Landlord or Landlord's nominee, an assignment of resident agreements, to the extent and only to the extent permitted by Iaw, and an assignment of contracts and operating leases. In addition, Tenant shall cooperate with Landlord in order to ensure a smooth transfer without interruption of the operation of the Leased Premises to Landlord or Landlord's nominee, Such cooperation shall include, without limitation, access to or transfer of (i) all records and other information with respect to residents and patients of the Leased Premises which are in the possession of Tenant or any affiliate of Tenant (subject to applicable legal requirements governing confidentiality of patient records), (c) At the request of Landlord or its nominee, Tenant shall enter into a (d) Management and Operations Transf'er Agreement (a "MOTA") with the successor operator of the Leased Premises in form and substance acceptable io Landlord and Tenant and as lawful and customary in the industry at the time of the transfer. The MOTA shall define responsibility and liability for matters related to the continuing operation of the Leased Premises arising prior to the date operations of the Leased Premises are transferred from Tenant, any sub-tenant, or any manager (as applicable) to the successor operator of the Leased Premises (herein the "Operations Transfer Date" ) and for matters related to operations of the Leased Premises arising on or after the Operations Transfer Date. The MOTA shall address (as of the Operations Transfer Date) the proration of monthly residency fees; periodic fees due under continuing service contracts; use of the Healthcare Licenses, billing and coordination of accounts receivables; utility charges and deposits; employee salaries, wages and other employment benefits for Leased Premises employees. The MOTA shall provide for indemnification of Tenant by Landlord and any successor operator of the Leased Preniises for liabilities related to the transfer of Healthcare Licenses and operations of the Leased Premises from and after the Operations Transfer Date. Notwithstanding the above, and for the avoidance of doubt, the MOTA shall follow the general guidelines and procedures as provided for the MOTA entered into as of the Commencement Date, provided however that the final form and content of the MOTA shall be subject to review and approval by Landlord and Tenant, Tenant acknowledges and agrees that at the expiration or (e) termination of the Lease, Tenant shall have paid all fees (including but not limited lo quality assurance fees owing to the California Department of Health Care Services and any fees owing to ihe California Office of State Wide Health Planning and Development or any successor agencies or similar programs in effect at the time of the termination of the Lease), penalties and taxes of any Icind, incurred dkuing or attributable to the time periods of Tenant's operation of the Leased Premises. Tenant further acknowledges and agrees to indemnify, protect, defend, and hold harmless Landlord and its respective members, managers, directors, officers, employees, agents successors and assigns fiom any and all detnands, claims, causes of action, fines, penalties, damages, losses, liabilities (including strict iiabiliiy), judgments, and expenses (including reasonable atlorneys''ees and other professionals'ees and court costs) incurred in connection with or arising from the Tenant's occupancy or operation of the Leased Premises for all periods prior io the expiration or termination of the Lease Term, for any failure by Tenant to pay any liabilities in connection with the Leased Premises, including but not limited to, any liabilities to any third party payor(s), including overpayments, or recovery audits, or investigations of any kind 22 which are attributable to the periods during Tenant's occupancy or operation of the Leased Premises. Notwithstanding anything herein to the contrary, nothing shall require Tenant to complete the necessary applications for or on behalf of Landlord or Landlord's nominees, except with the Tenant's portion of the application as "Seller" thereunder. 17,3 18, Hold Over. 18.1 In the event thai Tenant shall hold ihe Leased Premises after the expiration of any Lease Term hereof with the consent of Landlord, express or implied, such holding over shall, in the absence of written agreement on the subject, be deemed to have created a tenancy from month-to-month terminable on thirty (30) days'otice by either paly to the othei, at a monthly rental equal to the monthly rental payable during the last year of said tenn, plus fifty percent (50%), and otherwise subject to all the terms and provisions of this Lease. 19. Quiet Eniovment. Landlord covenants that the Tenant, on paying the rent reserved and on performing all the terms, covenants and conclitions hereof on the part of Tenant to be performed, and not being in default under any of the terms of this Lease, shall at all times during the Lease Term, peacefully and quietly have, hold and enjoy the Leased Premises. 19.1 20. Action on this Contract. Should either patty hereto institute any action or proceeding in court to enforce any provision hereof or for diunages by reason of an alleged breach of any provision of this Lease, the prevailing party shall be entitled to receive from the other such amount as the court may adjudge to be reasonable attorneys'ees for the services rendered to it in such action or proceeding in addition to all reasonable costs. 20.1 21. Notices. 21,1 All notices to be given by either party to this Agreement to the other party hereto shall be in writing, and shall be (a) given in person, (b) deposited in the United States mail, certified or registered, postage prepaid, return receipt requested, or (c) sent by national overnight courier service with confirmed receipt, each addressed as follows: If to New Operator: Legacy Healthcarc Center, I.I.C Attn: Dov Jacobs 11600 W. Washington Boulevard Los Angeles, CA 90066 With copies to: (which shall not constitute notice) Sanders Rehaste Sternshein 2 Harvey, LLP Aiin: Jennifer M. Sternshein, Esq. 5316 E, Chapman Avenue Orange, CA 92869 Telephone: (714) 289-7070 23 Facsimile: (714) 289-7071 E-mail:Sennifer@srshhealthlaw.corn If to Landlord: The Arlene H. Rosales Living Trust dtd 2/02/2012 c/o Arlene Rosales 1307 Dana Place Fulleidon, CA 92831 With copies to: (which shall not constitute notice) Siteman Law Group Attn: Ikarett B. Siteman 433 N. Catnden Dr., 4'" Floor Beverly Hills, CA 90210 Telephone: (310) 279-5249 Facsimile: (310) 279-5248 E-maih kbsitentan sitemanlawgroup.corn 21.2 Either party may, from time to time, designate a different place by written notice. Notices, demands, consents or requests served in the manner hereinabove described shall be deemed sufficiently served or given at the time of personal delivery or three (3) days after mailing thereof. 22. Reportinv. Obliaations. 22.1 Tenant shall, upon request by Landlord, furnish Landlord a complete and accurate copy of the anmial Medicare and Medi-Cal cost report for Tenant, current statements of Quality Assurance fees owed for the Facility, quarterly financial statements of the Tenant, and/or copies of the Tax Returns as filed annually. Updated financial information on the Guarantor, annually. Tenant shall provide, reasonably promptly after receipt or filing of same, the 2567 any and all Intents to Cite or Citations from any entity governmental or otherwise. 22.2 Tenant shall fully cooperate with Landlord and/or Landlord's lender with respect to financing of Landlord and respond to any request for information, including, but noi limited to financial, licensing, regulatory and physical plant issues and shall provide an estoppel certificate, or other similar document upon request, Tenant may not voluntarily discharge residents from the Facility outside the ordinary course of business so as to cause a material adverse effect on the Facility census. 22.3 23. Internretation. 23.1 The words "Landlord" and "Tenant", wherever used herein, shall be applicable to one or more persons, as the case may be, and the singular shall include the plural, and the neuter shall include the masculine and feminine, and if there be more than one, the obligations hereof shall be joint and several. The word "persons" wherever used, shall include individuals, firms, associations and corporations, 23.2 Both Landlord and Tenant have been represented by counsel and this Lease has been freely and fairly negotiated. Consequently, all provisions of this Lease shall be interpreted according to their fair meaning and shall not be strictly construed against any party. 24, Assiantnent. In the event that Landlord shall voluntarily or involuntarily, or by operation of law, transfer or convey their interest in the Leased Premises then the Landlord shall automatically be freed and relieved from all personal liability as respects the performance of any covenant or obligations on the part of Landlord contained in this Lease thereafter to be performed, so long as such successor, assignee or othe'; transferee of Landlord shall assume and agree to be liable and responsible for same. It is further provided that any iunount then due and payable to Tenant by Landlord under any provisions of this Lease shall be paid to Tenant, and Landlord shall not be released from any liability as respects performance of any covenants on the part of Landlord to be performed prior to such assignment or transfer. 24.1 24,2 Tenant shall not, v,ithout the prior written consent of Landlord, which may be provided or withheld in Landlord's absolute discretion, voluntarily or involuntarily assign, mortgage, encumber or hypothecate any interest in this Lease or sublet all or any portion of the Premises (except for occupancy by patients or residents of the Facility and/or uses incidental thereto, such as a barber shop, etc.}. Notwithstanding the foregoing, Tenant may, without Landlord's prior written consent, assign this Lease or sublet the Leased Premises or any portion thereof to a wholly owned subsidiary of Tenant if all of the following are first satisfied: (y) such subsidiary fully assumes Tenant*s obligations hereunder; and (z) Landlord shall have received an executed counterpart of all documents for such assignment or lease. At all times during the Term of this Lease, Dov E. Jacobs shall maintain an ownership interest of at least fifty-one percent (51'/0) of the Tenant and Tenant's sole member and shall be the Manager of Tenant. 25, Riahts Cumulative. 25.1 The various rights, options, elections, powers and remedies of the Landlord contained in this Lease relating to default on the part of Tenant shall be construed as cumulative, and no one of them exclusive of any others or of any other legal or equitable remedy which Landlord might otherwise have in the event of any breach or default in the terms hereof on the part of Landlord. The exercise of one right or remedy by Tenant shall not in any way impair its right to any other right or remedy until all obligations imposed upon Landlord have been fully performed. 25.2 The various rights, options, elections, powers and remedies of the Tenant contained in this Lease relating to any default, breach of warranty or other breach on the part of Landlord, shall be constmed as cumulative, and no one of them shall be deemed exclusive of any other or of any other legal or equitable remedy which Tenant might otherwise have in the event of any breach or default in the terms hereof on the part of Landlord. The exercise of one right or remedy by Tenant shall not in any way impair its right to any other right or remedy until all obligations imposed upon Landlord have been fully performed, 25 26. Bindina on Successors. 26.1 Each of the parties hereto hereby agrees to each and all of the terms and conditions of this Lease, it being fut&her agreed that each and all of the covenants and obligations of this Lease shall be binding upon and inure to the benefit of the parties hereto, as the case may require, and, except as herein otherwise specifically provided, as well, their respective heirs, executors, administrators, successors and assigns, subject at all times, nevertheless to all agreements and restrictions herein contained with respect to assignment, subletting, or hypothecation of Tenant's imerest in this Lease. 26.2 Nothing contained in this Lease shall be deemed or construed by the parties hereto, or by any third person, to create the relationship of principal and agent or of partnership or of joint venture, or of any association between Landlord and Tenant, and no provision contained in this Lease, or any acts of the parties hereto, shall be deemed to create any relationship between Landlord and Tenant, other than the relationship of Landlord and Tenant. 27. Waiver of Riahts. 27,1 No waiver of any default of Tenant hereunder shall be deemed or construed by the parties hereto, or by any third person, to create the relationship of principal and agent or of partnership or of joint venture, or of any association between Landlord and Tenant, and no provision contained in this Lease, or any acts of the parties hereto, shall be deenied to create any relationship between Landlord and Tenant, other than the relationship of Landlord and Tenant. 28. Memorandum of Lease. The parties hereto agree, upon the demand of either party, to execute a Memorandum of Lease in a form acceptable to both Landlord and Tenant, and acknowledge same so as to entitle it to be recorded, 28.1 28.2 Tenant shall execute and deliver to Landlord on the expiration or termination of this Lease, immediately on Landlord's request, a Termination of Memo of Lease, in recordable form, and a Termination of Lease. 29. Termination of Current Lease 29.1 The Current Lease by and between Landlord and Prior Tenant shall expire according to the terms of the Lease Termination as of the Cormnencement Date. There is no memorandum of lease recorded in the Los Angeles County Records. 30. Force Maieure. Whenever 'fenant shall be required by the terms of this Lease or by law to perform any contract, act, worl&, labor, or service, or to discharge any lien against the Leased Premises, or l.o perl'orm and comply with any laws, rules, orders, ordinances, regulations or zoning regulations, Tenant shall not be deemed to be in default herein and Landlord shall not 30.1 enforce or exercise any of its rights under tins Lease, if and so long as non-perl'ormance or del'suit herein shall be directly caused by strikes not caused by Tenant's actions, non-availability of materials, war or national defense pre-emptions, governmental restrictions, acts of God, acts of Landlord, or other similar causes beyond the reasonable control of Tenant. However, notwithstanding any of the provisions of the I'oregoing, Tenant shall in any event pay any sum of money required to discharge any lien incurred by Tenant if at any time the Leased Premises, or any part thereof, shall be in danger of being foreclosed, forfeited or lost, and Tenant shall conunence such performance and continue the same with diligence and continuity. 31. Governina Law. This Agreement shall be construed in accordance with, and its performance shall be governed by, the laws of the State of California, Any and all actions to enforce this Lease shall be conducted in the County of Los Angeles, California. 31,1 32. Intevrated Aareement, 32.1 This Lease contains all the agreements of the parties and cannot be amended or modified except by a written agreement signed by the parties. /Signatures onfollo&ving pagej IN WITNESS WI-IEREOE, the parties hereto have hereunto set their signatures as of the date first above written. "Landlord" The ARLENE H. ROSALES LIVTNE TRUST dated FEBRUARY 2, 2012 Hy..: - Name: Arlene Rosales 6'f& F,f.QL.2 Trustee "Tenant" LEGACYIIEALTHCARECENTER, LLC, a California I~in ited liability ompany Byy'ame: Title: Dov Jacobs."" Manager Schedules and Exhibits Schedule 1.1 Inventory of Leased Assets Schedule 2.1(f) Liens Schedule 2.1(gi Room Size %'aivers Schedule 2,1(h) OSHPD Repairs Exhibit A Legal Description Exhibit B Lease Termination Exhibit C Guaranty Schedule 1,1 Inventory of Leased Assets Area Business Office Medical Records Administration Office Social Service Office Conference Room I&itchen Item Desktop computer Computer table Office chair Steel metal cabinet Fax inaclliite Shelf/cabinet Office table AC windov'nit Office table Office chair Desktop computer Steel metal cabinet AC windov unit Office table Office chair Chair Shelf/cabinet AC window unit Monitor & RCVR camera Desktop computer 0 I'fice chair Office table Steel cablllet Electric fan Octagon table Copier Long conference table Office chairs Artificial plant Wall clock Steel cabinet for food 3-door refrigerator Ice machine Industrial blender Microwave Toaster Stove with 2 ovens Food catt Utility cart 30 Amount I I 4 2 4 2 I I I I I 6 I I I 3 I I I I I I 2 I I I I 4 I I I I I I I 2 I 4 3 Laundry Nurse Station Dining Room on 2"s Floor DSD Office Lounge Room DON's Office Rehab Room Food warmer (4 conlpartments) Food mixer Steels helves Stainless steel working Step tool Electric fan Mop Can opener Heavy duty vvasher Water heater Dryer Electric fan Office chair Table Stainless steel cart Copier Fax machine Office chair Medicine cart Treatment cart Crash cart Portable table Steel chair LED TV Round table Piano Office table Desktop computer Office chair Steel cabinet Small steel cabinet Refrigerator Table Chair Microv'ave Desktop computer Computer table Office table Office chair Digital weighing Scale Round table Chair Office table Small steel cabinet 31 ble I Oxygen Room Utility Room Generator Room Residents'oom Others l Linen cart Big oxygen tank Small oxygen tank Manual weighing scale Hoyer lift Generator Overbed table 'Bight stand table/cabinet Bed with mattress HVAC units Swamp cooler Wheel chair 6 6 ll I 1 1 48 53 54 6 1 20 Schedule 2.1(fl Liens Filing No. Filing Type File Date Lapse Date Debtor Secured Amount/Value Party 15-7469361062 I'inancing Statement 6/09/2015 6/09/2020 33 Arlene Rosales, Par Operations, Inc. Airx Ferguson 1 double-door, upright freezer msd 1 single solid-door upright freezer Schedule 2,1(g) Room Size Waivers 42 CF'R 483.70(d)(1) (i)-(ii) Square Feet Room Size 236.50 sq. ft. 21.5' 236.50 sq. ft, 12 231.80 sq. ft. 11'1.08' Beds 11'1.5' Room 11' Schedule 2.1(11) OSHPD Repairs None. 35 Exhibit "A" Legel Description A PN: 5 83 6-025-029 PARCEL I: THAT SOUTHERLY 25 I EET OF LOT 2 AND THE NORTI-IERLY 25 FEET OF LOT 3 IN BLOCI& "A" OF A.J. PAINTER'S SUBDIVISION OF THE NORTH PORTION OI'LOCI& "P" OF THE SUBDIVIDED LANDS OF J.I-I. PAINTER AND B.F. BALL, IN THE CITY OF PASADENA, COUNTY OF LOS ANGELES, STATE OF CALIFORNiA.,AS PER MAP RECORDED IN BOOI& 16 PAGE (Si 99 OF THE MISCELLANEOUS RECORDS, IN THE OFFICE OF THE COUNTY RECORDER OF SAID COUNTY. PARCEL 2: LOT 2 IN BLOCK "A" OF THE A,J. PAINTER'S SUBDIVISION OF THE NORTH PORTION OF BLOCI& "P" Ol'HE SUBDIVIDED LANDS OF J.H. PAINTER AND B.F. BALL, IN THE CITY OF PASADENA, COUNTY OF LOS ANGELES, STATE OF CALIFORNIA, AS PER MAP RECORDED IN BOOK. 16 PAGE(S) 99 OF MISCELLANEOUS RECORDS, IN THE OFFICE OF THE COUNTY RECORDER OF SAID COUNTY. EXCEPT THEREFROM TI-IE SOUTHERLY 25 FEET THEREOF. PROPERTY COMMONLY I&NO%/N AS: A COMMERCIAL BUILDING, AS TO PARCELS 1570 NORTI-I FAIR OAI&S AVENUE, CITY OF PASADENA, CALIFORNIA I AND 2 Exhibit Lease Termination 37 LEASE TERMINATION AGREEMENT TIIIS LEASE TERMINATION AGREEMENT (this "Agreement" ) is made and entered into as of April 15, 2016 by and among Arlene FL Rosales Living Trust (the "Lessor" ) and PAR Opertions, Inc„a California corporation (the "Lessee" with ) rei'erence to the following facts: RKCITAI S A. Lessor is the Lessor under that certain Lease dated as oi'April I, 2015, between Lessor and Lessee and all parts theteof and amendments thereto (the "Lease" ). The Lease covers improved real property in the City of Pasadena, California, with a sheet address 1570 N. Fair Oaks Avemte, Pasadena, California (thc "Property" ). Pursuant to the Lease, Lessee operates a skilled nursing facility, commonly known as Legacy Care of Pasadena which is located on the Property (the Facllhy ), 13. C. Effective on or before April 16, 2016, the Facility operations will be transferred to the New Operator (as defined below) pursuant to the terms of this Agreenletlt rtntl the Transttton Docurnetlts (as dcftned oelow). D. Lessor and Lessee desire to enter into this Agrccrnent, in order to provide for a peaceful and orderly termination of the Lease between Lessor and Lessee. AGREEMENT NOW, THEREFORE, in consideration of the above-reference facts and the covenants of'essor and Lessee contained in this Agreement, and for the other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Lessor and Lessee agree aa follows; 1. Lffective Da~t. Date'*) shall be April 16, 2016. Tire eff'ective date of this Agreement (the "Effective Termination. On the EIIective Date, the Lease shall terminate and any recorded references to the Lease shall be removed of record. 2. 3. Securitv D~eosit, The I.,ease did not require a security deposit and Lessee has not deposited any security deposit vvith Lessor. As of the date of this Lease Termination, the Lessee is cutvent on all rental payments owed to Lessor under the Lease, 4. Miscellaneous Provisions. Govcrninp Law, This Agteement shall be governed by ruul construed in accordance with the laws of the State ol'California. 4,1 4,2 Partial Invaltditi. if any provision of this Agreement is found to be invalid or unenforceable by any cond or other lawful forum such provision shall be ineffective only to the extent that it is in contravention or applicable laws without invalidating the remaining provisions of this Agreement, unless such invalidity or unenforceability would defeat an essential business purpose of this Agreement. Cotutterparts. This Agreement may be executed in two or more counterparts, each of which shall be deemed an original, but all of which taken together shall constitute one and the same instrument. This Agreement shall be deemed signed and delivered upon the exchange by facsimile transmission (fax), electronic or PDFs of. signed countetparts. 4.3 Successors and Assigns, This Agreement shall be binding on the parties to tins Agreement and on their respective heirs, devisees, successors and assigns. 4,4 Attornevs'ees. Should any patty to this Agreement institute any action or proceeding arising out of this Agreement the substantially prevailing party in 4.5 any such action of proceeding shall bc entitled to receive from the other party or parties to such action or proceeding all costs and expenses, including reasonable attorneys'ees, incurred by the substantially prevailing patty in connection with such aclion or proceeding. The determination, of which party is the "substantially prevailing party," shall be made by the court or arbitrator, as applicable, at the time of the action or proceeding, as the case may be. Notwithstanding the foregoing, attorneys'ees incurred in enforcing any judgment are recoverable as a separate item and such agreemeni of the parties is intended to be severable from the other provisions of this Agreement and is intended to survive any judgment and is not to be deemed nterged into any juclgment. EVIDENClNG their agreement to the above terms and conditions, Lessor and Lessee have executed this Agreement as of the date tirst set forth above. [SIGV~TURES OV NEXTPAGAj 8ignature Page — Lease Termination LESSEE: PAR Operations, Inc., a California corporation Name: Arlene H, Rosales Its: President LESSOR: ARLENE H. ROSAI.ES, AS TRl.lSTEE OF Tl-IE ARLENE H. ROSALI-",S LIVING TRUST kG- IXAf'-4 Arlene Name: Its: Trustee H, Rosaies Exhibit "C" GUARANTY OF LEASE THIS GUARANTY OF LEASE (" Guaranty*') is made by Dov E. Jacobs and Miriam Taub, each an individual (collectively, the "Guarantor") in favor of the Arlene H, Rosales Living Trust dated February 2, 2012 (the "Landlord"}, in connection with that certain Operating Lease, dated as of 2016 (the "Lease" ), pursuant to which Landlord leases to Legacy I lealthcare Center, LLC, a California limited liability company (" Tenant" ) those premises improved with a skilled nursing facility, located at 1570 North Fair Oaks Avenue, Pasadena, California, 91103, and such other Property included within the term "Leased Premises" as defined in the Lease. As a material inducement to and in consideration of Landlord entering into the Lease, Landlord having indicated that it would not enter into the Lease v ithout the execution of this Guaranty, Guarantor does hereby agree with Landlord as follows; April, I, Guarantor does hereby, unconditionally and irrevocably guarantee, as a primary obligor and not as a surety, and promises to perform and be liable for any and all obligations and liabilities of Tenant under the tern;s of the Lease. This Guaranty is being given so that Landlord shall look solely to the Guarantor and not to the members, officers, and directors of Tenant I'or satisfaction for any unsatisfied claims against Tenant. Except as specifically set forth herein, ihe Guaranty shall otherwise be unlimited. Guarantor does hereby agree that, without the consent of or notice to Guarantor and without affecting any of the obligations of Guarantor hereunder: (a) any term, covenant or condition of the Lease may be amended, compromised, released or otherwise altered by Landlord and Tenant, and Guarantor does guarantee and promise to perform all the obligations of Tenant under the Lease as so amended, compromised, released or altered; (b) any guarantor of or party to the Lease may be released, substituted or added; (c) any right or remedy under the Lease may be exercised, not exercised, impaired, modifi d, limited, destroyed or suspended; (d) Landlord or any other person acting on Landlord's behalf may deal in any manner with Tenant, any guarantor, any party to the Lease or any other person; and (e) all or any part of the Leased Premises or of Tenant' rights or liabilities under the Lease may be sublet, assigned or assumed. This is a continuing guaranty. 2, 3. Guarantor hereby waives and agiees not to assert or take advantage of: (a) any right to require Landlord to proceed against Tenant or any other person or to pursue any other remedy before proceeding against Guarantor; (b) the defense of any statute of limitations in any action under or related to this Guaranty or the Lease; (c} any right or defense that may arise by reason of ihe dissolution or lack of authority of Tenant or any other person; and (d) any right or defense arising by reason of the absence, impairment, modification, limitation, destruction or cessation (in banlcruptcy, by an election of remedies, or otherwise) of the liability of Tenant, of the subrogation rights of Guarantor or of the right of Guarantor to proceed against Tenant for reimbursement, Without in any manner limiting the generality of the foregoing, Guarantor hereby waives the benefits of the provisions of Sections 2787 to 2855, inclusive, 2899 and 3433 of the California Civil Code and any similar or analogous statutes of California or any other jurisdiction. 4. Guarantor hereby waives and agrees not to asseri or take advantage of any right or defense based on the absence of any or all presentments, demands (including demands for performance), notices (including notices of adverse change in the financial status of Tenant or other facts which increase the risk to Guarantor, notices of non-performance and notices of acceptance of this Guaranty) and protests of each and every kind. 5, Neither Guarantor's obligation to make payment in accordance with this Guaranty nor any remedy for the enforcement thereof shall be impaired, modified, changed, stayed, released or limited in any manner by any impairment, modification, change, release, limitation or stay of the liability of Tenant or its estate in bankruptcy or any remedy for the enforcement thereof, resulting from the operation of any present of future provision of the Banlcruptcy Code (as defined in the Lease) or other statute or fiom the decision of any court interpreting any of the satne, and Guarantor shall be obligated under this Guaranty as if no such impairment, stay, modification, change, release oi'imitation had occurred, Until all of Tenant's obligations under the Lease are fully performed, Guarantor (a) shall have no right of subrogation against Tenant by reason of any payments or acts of performance by Guarantor under this Guaranty; and (b} subordinates any liability or indebtedness of Tenant now or hereafter held by Guarantor to the obligations of Tenant under, arising out of or related to the Lease or Tenant's use or occupancy of the Leased Premises. 6. 7. The liability of Cruarantor and all rights, powers and remedies of Landlord hereimder and under any other agreement now or at any time hereafter in force between Landlord and Guarantor relating to the Lease shall be cumulative and not alternative and such rights, powers and remedies shall be in addition to all rights,.powers and remedies given to Landlord by law. This Guaranty applies to, inures to the benefit of and binds all parties hereto, their heirs, devisees, legatees, executors, admiiustrators, representatives, successors and assigns (including any purchaser at a judicial foreclosure or trustee's sale or a holder of a deed in lieu thereof). This Guaranty may be assigned by Landlord voluntarily or by operation of law. Any Guarantor hereunder may be replaced v'ith a replacement Guarantor, reasonably acceptable to Landlord. 8. Guarantor shall not, v:ithout the prior written consent of Landlord, commence, or join with any other person in commencing, any bankruptcy, reorganization or insolvency proceeding against Tenant. The obligations of Guarantor under this Guaranty shall not be altered, limited or affected by any proceeding, voluntarily or involuntarily, involving ihe bankruptcy, insolvency, receivership, reorganization, liquidation or arrangement of Tenant, or by any defense which Tenant may have by reason of any order, decree or decision of any court or administrative body resulting from any such proceeding, Guarantor shall file in any banluuptcy or other proceeding in which the filing of claims is required or permitted by law all claims which Guarantor may have against Tenant relating io any indebtedness of Tenant to Guarantor and will assign io Landlord all rights of Guarantor thereunder. Landlord shall have the sole right to accept or reject any plan proposed in such proceeding and to take any other action which a party filing a claim is entitled to do. In all such cases, whether in administration, bankruptcy or otherwise, the person or persons authorized to pay such claim shall pay to Landlord the atnount payable on such claim and, to ihe full extent necessary for that purpose, Guarantor hereby assigns to Landlord all of 9. Guarantor's rights to any such payments or distributions to which Guarantor would otherwise be entitled; provided, however, that Guarantor's obligations hereunder shall not be satisfied except to the extent that Landlord receives cash by reason of any such payment or distribution. If Landlord receives anything hereunder other than cash, the same shall be held as collateral for amounts due under this Guaranty. 10, If requested by the Landlord, Guarantor shall deliver t.o the Landlord (a) the most recent federal income tax return for Guarantor within thirty (30) days after the date on which such return is filed by Guarantor. Guarantor shall provide the Landlord with such other information and statements concerning the financial condition and affairs of Guarantor as the Landlord may require within five (5) business days after the Landlord's request for such reasonable information. All financial information and statements provided by Guarantor to Landlord shall be certified to be true and correct by Guarantor. As a material inducement to the Landlord entering into the Lease with Tenant, Guarantor makes the following representations and warranties to the Landlord, each of which shall survive the commencement and termination. of the Lease: 11. 11.1. Guarantor has the full power and authority to carry on its business and to enter into and perform all of its obligations under this Guaranty, and this Guaranty, when executed by Guarantor, shall constitute the legal, valid and binding obligation of Guarantor enforceable in accordance with its terms, No consent oi'any other person not previously obtained by Guarantor, and no consent, approval, authorization or other action by or filing with any governmental authority not previously obtained, taken, or made, as applicable, is required in connection with the execution, delivery and performance of Guarantor's obligations under this Guaranty. 11.2. Guarantor's execution of this Guaranty and Guarantor's performance of its obligations hereunder will not result in a breach or violation of (a) any governmental requirements applicable to Guarantor or any judgment, v;rit, injunction, decree or order of any court relating and known to Guarantor; or (b) any mortgage, cominitment, restriction, or other document to which Guarantor is a party or by which Guarantor is bound. 11.3. All statements respecting the financial condition of Guarantor and Tenant, respectively, which have been furnished to the Landlord or which are hereafter submitted to the Landlord (a) are or shall be accurate and complete in all respects as of the dates appearing thereon; (b) present or shall present fairly the financial condition and results of operations of the person to whom the financial statement applies as of the dates iuid for the periods shown on such statements; (c) disclose or shall disclose all suits, actions, proceedings and contingent liabilities materially affecting the person to whom the financial statement applies; and (d) since the last date covered by the financial statements which have been unushed to the Landlord, there has been no material adverse change in the financial condition of the persons to v,horn such statements apply, All other reports, information and documents furnished to thc Landlord by Guarantor in connection with the Lease are accurate and complete in all respects. The confidentiality provisions contained in the Lease shall be incorporated by reference into this Guaranty, provided that all references to "Tenant" shall be deemed Guarantor, 40 11.4. There are no actions, suits, proceedings or investigations pending or, to the best of Guarantor's luzowledge, threatened against or affecting Guarantor in any court or before any other governmental authority, nor does Guarantor know of any basis for any such action, suit, proceeding or investigation. 11.5. Guarantor has received a copy of the Lease, has carefully read such Lease, and understands all of the terms of such Lease, Guarantor hereby covenants and agrees that it shall not, without the prior written consent of Landlord, which consent may be granted or withheld in Landlord's reasonable discretion, take any action that would have a material adverse effect on the Guarantor's ability to pay any of its liabilities or perform any of its obligations under this Guaranty. 12. This Guaranty shall constitute the entire agreement between Guarantor and the Landlord with respect to the subject!natter hereof, No provision of this Guaranty or right of Landlord hereunder may be waived nor may Guarantor be released fiom any obligation hereunder except by a writing duly executed by Landlord, 13, 14. If more than one person signs this Guaranty, each such person shall be deemed a Guarantor and the obligation of all such Guarantors shall be joint and several. When the context and construction so requires, all words used in the singular herein shall be deemed to have been used in the plural. The word "person" as used herein shall include an individual, company, firm, association, partnership, corporation, trust or other legal entity of any kind whatsoever, Should any one or more provisions of ibis Guaranty be determined to be illegal or unenforceable, all other provisions shall nevertheless be effective. 15. The waiver or failure to enforce any provision of this Guaranty shall not operate as a waiver of any other breach of such provision or any other provisions hereof. 16. Upon the Landlord*s demand, Guarantor shall reimburse the Landlord for all costs and expenses, including attorney, accountant, consultant, and expert witness fees and costs, which are incurred by the Landlord in connection with the exercise of any or all of the Landlord's rights and remedies under this Guaranty, including attorney fees and costs incurred in connection with the enforcement of the Lease ancVor all of the Landlord's rights against Guarantor under this Guaranty, whether or not any legal proceedings are instituted by the Landlord, and all costs, attorney fees and expenses incurred by the Landlord in connection with any banluuptcy proceeding or other similar proceeding involving Guarantor which in any way affects the Landlord's exercise of any of its rights and remedies under this Guaranty. Guarantor's obligation to reimbtuse the Landlord under this Section shall include payment of interest on all amounts expended by the Landlord from the date of expenditure at the rate of ten percent (10N) per annum. Without limiting the terms of this Section, Guarantor agrees that the Landlord shall be entitled to retain such attorneys as the Landlord, in its sole discretion, may select at such attorneys customary rates and charges for legal fees, costs and other services, and the Landlord shall be entitled to full reimbursement from Guarantor for all such fees, costs and charges, regardless of any schedule, formula or other guideline for atlorney's fees, whether described as reasonable or otherwise, which 17, 41 is established, set or adopted pursuant to any goveriunental requirement or by any trial, appellate, or banl&ruptcy court or governmental authority. 18, of the essence under this Guaranty and any amendment, 19. If Guarantor is a corporation, each individual executing this Guaranty on behalf of Time is strictly modification or revision hereof. said corporation represents and warrants that he is duly authorized to execute and deliver this Guaranty on behalf of said corporation, in accordance with a duly adopted resolution of the board of directors of said corporation or in accordance with ihe bylaws of said corporation, and that this Guaranty is binding upon said corporation in accordance with its terms. If Guarantor is a corporation, Landlord, at. its option, may require Guarantor to concurrently, with the execution of this Guaranty, deliver to Landlord a certified copy of a resolution of the board of directors of said corporation authorizing or ratifying the execution of this Guaranty. The term "Landlord" whenever hereinabove used refers to and means the Landlord in the foregoing Lease specifically named and also any assignee of said Landlord, whether by outright assignment or by assignmeni for security, and also any successor to the interest of said Landlord or of any assignee of such Lease or any part thereof, whether by assignment or otherwise. The term "Tenant" whenever hereinabove used refers to and means the Tenant in the foregoing Lease specifically natned and also any assignee or subtenant of said Lease and also any successor to the interests of said Tenant, assignee or sublessee of such Lease or any part thereof, whether by assignment, sublease or otherwise. 20. Any notice, request,. demand, insti'uction or other communication to be given to any party hereunder shall be in writing and sha!1 be either served personally, or sent by overnight. courier, or registered or certified mail, return receipt requested with postage prepaid, and addressed io the party to be notified at the address sei forth below, or to such other place as the party to be notified may from time to time designate by at least fifteen (15) days'otice to the notifying party, Any such notice, request, demand, instruction or other comnuinication shall be deemed sufliciently served or given for all purposes hereunder eiihcr (a) if personally served, upon such service, (b) if sent by overnight courier, the follov,ing business day, or (c) if mailed, two (2) business days after the time of mailing or on the date of receipt shown on the return receipt, whichever is first: 21. To Guarantor: Dov E. Jacobs 11600 W, Washington I3Ivd. Los Angeles, CA 90066 Miriam Taub 395 Pearsall Ave., Ste. Ik Cedarhurst, NY 11516 With a copy to (v hich shall not constitute notice): Sanders Rehaste Sternshein k l-larvey, LLP Attn: Jennifer M. Ste!nshein, Esq. 5316 E. Chapman Avenue Orange, CA 92869 Telephone: 714-289-7070 Fax No. 714-289-7071 E-mail:Jenniferra'srshhealthlaw.corn To Landlord: Arlene H, Rosales Living Trust dated February 2, 2012 c/o Arlene Rosales 1307 Dana Place Fullerton, CA 92831 With a copy to; Siteman Law Group Attn: Karen B, Siteman 433 N. Camden Dr., 4"'loor Beverly Hills, CA 90210 Telephone: (310) 279-5249 Facsimile: (3101 279-5248 E-mail:1&bsiteman@sitemanlawgroup.corn As a further material part of the consideration to Landlord to enter into the Lease with Tenant, Guarantor agrees; 22, 22.1. The law of the state in rvhich the Leased Premises is located shall govern all questions with respect to the Guaranty; 22.2. That any suit, action or proceeding arising directly or indirectly from the Guaranty, the Lease or the subject matter thereof shall be litigated only in courts located within the county and state in which the Leased Premises is located; 22.3. Guarantor hereby irrevocably consents to the jurisdiction of any local, state or federal court located within thc county and state in which the Leased Premises is located; 22.4. Guarantor hereby waives personal service of any and all process upon it and consents to all such service of process in the manner and at. the address set forth in Paragraph 20 above; and 222k Without limiting the generality of the foregoing, Guarantor hereby waives and agrees not to assert by way of motion, defense or otherwise in any suit, action or proceeding any claim that Guarantor is not personally subject to the jurisdiction of the above-named courts, that such suits, action or proceeding is brought in an inconvenient forum or that the venue of such action, suit or proceeding is improper. All undefined capitalized terms used herein shall have the same meaning as set forth in the Lease. 23. Guarantor acknowledges and agrees that Landlord may further assign this Guaranty to Landlord's lender, its successors and assigns. 24, [Sigttatures on following pageJ Legacy Healttt care Center, LLC Guaranty-Signature Page IN WITNESS WIIEREOF, the parties have duly executed and notarized this Guaranty as of the dates written below. GUARANTOR: Dated: Dov E. Jacobs April, 2016 Dated: April Miriam Taub A Notary Acknov ledgement Form is attached hereto, 2016 Exhibit 2.1 GUARANTY OF LEASE THIS GUARANTY OF LEASE (" Guaranty" ) is made by Dov E. Jacobs and Miriam Taub, each an individual (collectively, the "Guara'iitor") in favor of the Arlene H. Rosales Living Trust dated February 2, 2012 (the "Landlord" ), in connection with that certain Operating Lease, dated as of April 16, 2016 (the "Lease"), pursuant to which Landlord leases to Legacy Healthcare Center, LLC, a California limited liability company (" Tenant" ) those premises improved with a skilled nursing facility, located at 1570 Notch Fair Oaks Avemie, Pasadena, California, 91103, and such other Property included within the term "Leased Premises" as defined in the Lease. As a material inducement to and in consideration of Landlord entering into the Lease, Landlord having indicated that it would not enter into the Lease without the execution oi'this Guaranty, Guarantor does hereby agree with Landlord as follows: Guarantor does hereby, unconditionally and irrevocably guarantee, as a primary obligor and not as a surety, and promises to perform and be liable for any and all obligations and liabilities of Tenant under the terms of the Lease, This Guaranty is being given so that Landlord shall look solely to the Guarantor and not to the inembers, officers, and directors of Tenant for satisfaction for any unsatisfied clahns against Tenant. Except as specifically set forth herein, the Guaranty shall otherwise be unlimited. 1. 2. Guarantor does hereby agree that, without the consent ol'or notice to Guarantor and without affecting any of the obligations of Guarantor hereunder; (a) any term, covenant or condition of the Lease may be amended, compromised, released or otherwise altered by Landlord and Tenant, and Guarantor does guarantee and promise to perform all the obligations of Tenant under the Lease as so amended, compromised, released or altered; (b) any guarantor of or party to the Lease may be released, substituted or added; (c) any right or remedy under the Lease may be exercised, not exercised, impaired, modified, limited, destroyed or suspended; (d) Landlord or any other person acting on Landlord's behalf may deal in iuiy manner with Tenant, any guarantor, any party to the Lease or any other person; and (e) all or any part of the Leased Premises or of Tenant' rights or liabilities under the Lease may be sublet, assigned or assumed. This is a continuing guaranty. 3. Guarantor hereby v,aives and agrees not to assert or take advantage of: (a) any right to require Landlord to proceed against Tenant or any other person or to pursue any other remedy before proceeding against Guarantor:, (b) the, defense of any statu'te of limilations in any action under or related to this Guaranty or the Lease; (c) any right or defense that may arise by reason of the dissolution or lack of authority of Tenant or any other person; and (d) any right or defense arising by reason of the absence, impairment, modification, limitation, destruction or cessation (in bankruptcy, by an election of remedies, or otherwise) of the liability of Tenant, of the subrogation rights of Guarantor or of the right of Guarantor to proceed against Tenant for reimbursement. Without in any manner limiting the generality ol'he foregoing, Guarantor hereby waives the benefits of the provisions of Sections 2787 to 2855, inclusive, 2899 and 3433 of the California Civil Code and any similar or analogous statutes of California or any other jurisdiction. 4. Guarantor hereby waives and agrees not to assert or take advantage ol'any right or defense based on the absence of any or all presentments, demands (including demands for performance), notices (including notices of adverse change in the financial status of Tenant or other facts which increase the risk to Guarantor, notices of non-performance and notices of acceptance of this Guaranty) and protests of each and every kind. Neither Guarantor's obligation to make payment in accordance with this Guaranty nor any remedy for the enforcement thereof shall be impaired, modified, changed, stayed, released or limited in any manner by any impairment, modification, change, release, limitation or stay of the liability of Tenant or its estate in bankruptcy or any remedy for the enforcement thereof, resulting from the operation of any present of future provision of the Bankruptcy Code (as dehned in the Lease) or other statute or from the decision of any court interpreting any of the same, and Guarantor shall be obligated under this Guaranty as if no such impairment, stay, modification, change, release or limitation had occurred. 5, 6. Until all of Tenantls obligations under the Lease are fully performed, Guarantor (a) shall have no right of subrogation against Tenant by reason of any payments or acts of performance by Guarantor under this Guaranty: and {b) subordinates any liability or indebtedness of Tenant now or hereafter held by Guarantor to the obligations of Tenant under, arising out of or related Lease or Tenant's use or occupancy of the Leased Premises. to'he 7, The liability of Guarantor and all rights, powers and remedies of Landlord hereunder and under any other agreement now or at any time hereafter in force between Landlord and Guarantor relating to the Lease shall be cumulative and not alternative and such rights, powers and remedies shall be in addition to all rights, powers and remedies given to Landlord by law. 8, This Guaranty applies to, inures to the benefit of and binds all parties hereto, their heirs, devisees, legatees, executors, administrators, representatives, successors and assigns (including any purchaser at a judicial foreclosure or trustee's sale or a holder of a deed in lieu thereof). This Guaranty may be assigned by Landlord voluntarily or by operation of law. Any Guarantor hereunder may be replaced with a replacement Guarantor, reasonably acceptable to Landlord, Guarantor shall not, without the prior written consent of Landlord, commence, or join with any other person in commencing, any bankruptcy, reorganization or insolvency proceeding against Tenant, The obligations of Guarantor under this Guaranty shall not be altered, limited or affected by any proceeding, voiuntarily or involuntarily, involving the bankruptcy, insolvency, receivership, reorganization, liquidation or arrangement of Tenant, or by any defense which Tenant may have by reason of any order, decree or decision of any court or administrative body resulting from any such proceeding. Guarantor shall Iile in any banlcruptcy or other proceeding in which the filing of claims is required or permitted by law all claims which Guarantor may have against Tenant relating to any indebtedness of Tenant to Guarantor and will assign to Landlord all rights of Guarantor thereunder. Landlord shall have the sole right to accept or reject any plan proposed in such proceeding and to take any other action which a party filing a claim is entitled to do. In all such cases, whether in administration, bankruptcy or otherwise, the person or persons authorized to pay such claim shall pay to Landlord the amount payable on such claim and, to the full extent necessary for that purpose, Guiuantor hereby assigns to Landlord all of Guarantor's rights to any such payments or distributions to which Guarantor would otherwise be entitled; provided, however, that Guarantor's obligations hereunder shall not be satisfied except to the extent that Landlord receives cash by reason oi any such payment or distribution. If Landlord 9. receives anything hereunder other than cash, the same shall be held as collateral for amounts due under this Guaranty, 10. If requested by the Landlord, Guarar.tor shall deliver to the Landlord (a) the most recent federal income tax return for Guarantor within thirty (30) days after the date on which such return is filed by Guarantor. Guarantor shall provide the Landlord with such other information and statements concerning the financial condition and affairs of Guarantor as the Landlord may require within five (5) business days after the Landlord's request for such reasonable information, All financial information and statements provided by Guarantor to Landlord shall be certified to be true and correct by Guarantor. As a material inducement to the Landlord entering into the Lease with Tenant, Guarantor mal&es the following representations and warranties to the Landlord, each of which shall survive the commencement and termination of the Lease; 11. 11.1, Guarantor has the full power and authority to catty on its business and to enter into and perform all of its obligations under this Guaranty, and this Guaranty, when executed by Guarantor, shall constitute the legal, valid and binding obligation of Guarantor enforceable in accordance with its terms. No consent of any other person not previously obtained by Guarantor, and no consent, approval, authorization or other action by or filing with any governmental authority not previous1y obtained, taken, or niade, as applicable, is required in connection with the execution, delivery and performance of Guarantor's obligations under this Guaranty, 11.2. Guarantor's execution of this Guaranty and Guarantor's performance of its obligations hereunder will not result in a breach or violation of (a) any governmental requirements applicable to Guarantor or any judgment, writ, injunction, decree or order of any court relating and known to Guarantor; or (b) any mortgage, conunitment, restriction, or other document to which Guarantor is a party or by which Guarantor is bound. 11.3. All statements respecting the financial condition of Guarantor and Tenant, respectively, which have been furnished to the Landlord or which are hereafter submitted to the Landlord (a) are or shall be accurate and coniplete in all respects as of the, dates appearing thereon; (b) present or shall present fairly the financial condition and results of operations of the person to whom the financial statement applies as of the dates and for the periods shown on such statements; (c) disclose or shall disclose all suits, actions, proceedings and contingent liabilities materially affecting the person to whom the financial statement applies; and (d) since the last date covered by the financial statements which have been furnished to the Landlord, there has been no material adverse change in the financial condition of the persons to whom such statements apply. All other reports, informal,ion and documents furnished to the Landlord by Guarantor in connection with the Lease are accurate and complete in all respects. The confidentiality provisions contained in the Lease shall be incorporated by reference into this Guaranty, provided that all references to "Tenant" shall be deemed Guaranton I I vk There are no actions, suits, proceedings or investigations pending or, to the best of Guarantor's knowledge, threatened against or affecting Guarantor in any court or bel'ore any other governmental ailthority, nor does Guarantor know of any basis for any such action, suit, proceeding or investigation. 11.5. Guarantor has received a copy of the Lease, has carefully read such Lease, and understands all of the terms of such Lease. 12. Guarantor hereby covenants and agrees that it shall not, without the prior written consent of Landlord, which consent may be granted or withheld in Landlord's reasonable discretion, take any action that would have a material adverse effect on the Guarantor's ability to pay any of its liabilities or perform any of its obligations under this Guaranty. 13. This Guaranty shall constitute the entire agreement between Guarantor and the Landlord with respect to the subject matter hereof, No provision of this Guaranty or right of Landlord hereunder may be waived nor may Guarantor be released from any obligation hereunder except by a writing duly executed by Landlord. 14, If more than one person signs this Guaranty, each such person shall be deemed a Guarantor and the obligation of all such Guarantors shall be joint and several. When the context and construction so requires, all words used in the singular herein shall be deemed to have been used in the plural. The word "person" as used herein shall include an individual, company, firm, association, partnership, corporation, trust or other legal entity of any 1&ind whatsoever. 15, Should any one or more provisions of this Guaranty be determined to be illegal or unenforceable, all other provisions shall nevertheless be effective, 16. The waiver or failure to enforce any provision of this Guaranty shall not operate as a waiver of any other breach of such provision or any other provisions hereof, 17. Upon the Landlord's demand, Guarantor shall reimburse the Landlord for all costs and expenses, including attorney, accountant,.consultant, and expert witness fees and costs, which are incurred by the Landlord in connection with the exercise of any or all of the Landlord's rights and remedies under this Guaranty, including attorney fees and costs incurred in connection with the enforcement of the Lease and/or all of the Landlord's rights against Guarantor under this Guaranty, whether or not any legal proceedings are instituted by ihe Landlord, and all costs, attorney fees and expenses incurred by the Landlord in connection with any bankruptcy proceeding or other similar proceeding involving Guaramor which in any way affects the Landlord's exercise of any of its rights and remedies under this Guaranty. Guarantor's obligation to reimburse the Landlord under this Section shall include payment of interest on all amounts expended by the Landlord from ihe date of expenditure at the rate of ten percent (10%) per annum. Without. limiting the terms of this Section, Guarantor agrees that the Landlord shall be entitled to retain such attorneys as the Landlord, in its sole discretion, may select at such attorneys customary rates and charges for legal fees, costs and other services, and the Landlord shall be entitled to full reimbursement from Guarantor for all such fees, costs and charges, regardless of any schedule, formula or other guideline for attorney's fees. v"hether described as reasonable or otherwise, which is established, set or adopted pursuant to any governmental requirement or by any trial, appellate, or bankruptcy court or governmental authority. 18. Time is strictly of the essence under this Guaranty and any amendment, modification or revision hereof. 19. If Guarantor is a corporation, each individual executing this Guaranty on behalf of said corporation represents and warrants that he is duly authorized to execute and deliver this Guaranty on behalf of said corporation, in accordance with a duly adopted resolution of ihe board of directors of said corporation or in accordance with the bylaws of said corporation, and that this Guaranty is binding upon said corporation in accordance with its terms. If Guarantor is a corporation, Landlord, at its option, may require Guarantor to concurrently, with the execution of this Guaranty, deliver to Landlord a certified copy of a resolution of the board of directors of said corporation authorizing or ratifying the execution of this Guaranty. The term "Landlord" whenever hereinabove used rel'ers to and means the Landlord in the foregoing Lease specifically named and also any assignee of said Landlord, whether by outright assignment or by assigmnent for security, and also any successor to the interest of said Landlord or of any assignee ol'such Lease or any part thereof, whether by assignment or otherwise, The term "Tenant" whenever hereinabove used refers to and means the Tenant in the foregoing Lease specifically named and also any assignee or subtenant of said Lease and also any successor to the interests of said Tenant, assignee or sublessee of such Lease or any part thereof, whether by assignment, sublease or otherwise, 20. Any notice, request, demand, instruction or other communication to be given to any party hereunder shall be in writing and shall be either served personally, or sent by overnight courier, or registered or certified mail, return receipt requested with postage prepaid, and addressed to the party to be notified at the address set iota below, or to such other place as the party to be notified may from time to time des! gnate by at least fifteen (15) days'otice to the notifying party. Any such notice, request, demand, instruction or other communication shall be deemed sufficiently served or given for all purposes hereunder either (a) if personally served, upon such service, (b) if sent by overnight courier, the follov'ing business day, or (c) if mailed, two (2) business days after the time of mailing or on the date of receipt shown on the return receipt, whichever is first: 21. To Guarantor: Dov E. Jacobs 11600 W. Washington Blvd. Los Angeles, CA 90066 Miriam Taub 395 Pearsall Ave.. Ste. Cedarhurst, NY 11516 I& With a copy io (which shall not constitute notice): Sanders Rehaste Sternshein k, Harvey, LLP Atln: Jennifer M, Sternshein, Esq. 5316 E. Chapman Avenue Orange, CA 92g69 Telephone: 714-289-7070 Fax No. 714-2g9-7071 E-mail:Jenniferfusrshhealthlaw.corn To Landlord: Arlene H. Rosales Living Trust dated February 2, 2012 c/o Arlene Rosales 1307 Dana Place Fullerton, CA 92831 With a copy to: Siteman Lav; Group Attn: Ikaren B, Siteman 433 N, Camden Dr., 4"'loor Beverly Hills, CA 90210 Telephone: (310) 279-5249 Facsimile: {310) 279-5248 E-maih kbsiteman@sitemanlawgroup.corn 22, As a further material part of the consideration to Landlord to enter into the Lease with Tenant, Guarantor agrees: 22,1. The law of the state in which the Leased Premises is located shall govern all questions with respect to the Guaranty; 22,2, That any suit, action or proceeding arising direct.ly or indirectly from the Guaranty, the Lease or the subject matter thereof shall be litigated only in courts located within the county and state in which the Leased Prenuses is located; 22.3. Guarantor hereby irrevocably consents to the jurisdiction of any local, state or federal court located within the county and state in v;hich the Leased Premises is located; 22.4. Guarantor hereby v aives personal service of any and all process upon it and consents to all such service of process in the manner and at the address set forth in Paragraph 20 above; and 22.5. Without limiting the generality of the foregoing, Guarantor hereby waives and agrees not to assert by way of motion, defense or otherwise in any suit, action or proceeding any claim that Guarantor is not personally subject to the jurisdiction of the above-named courts, I.hat such suits, action or proceeding is brought in an inconvenient forum or that the venue of such action, suit or proceeding is improper. 23. All undefined capitalized terms used herein shall have the same meaning as set forth in the Lease. 24. Guarantor acknowledges and agrees that Landlord may further assign this Guaranty to Landlord's lender, its successors and assigns. jSignnlures on foiiotving pngeJ Legacy Healtttcare Center, LLC Gttaranty-Signature Page IN WITNESS WI-IEREOF, the parties have duly executed and notarized this Guaranty as of the dates written below. GUAIVLNTO': ( Do+~Jacobs / Dated: July+,2016 A Notary Acknowledgement Form is attached hereto. ACKNOW EDGMENT notary public or other officer completing this certificate verifies only the identity of the Individual who signed the document to vrhich this certificate is attached, and not the truthfulness, accuracy, or validity of that document. A State of California County of On Los Angeles 07/{8 /2016 befo e me A. Sheikh, Notary Public (insert name and title of the officer) 85 personally appeared S'0 V E JrA) CQ who proved to me on the basis of satisfactory evidence to be the person(yr) whose name(yr) is/ass subscribed to the within instrument and acknowledged to me that executed the same authorized capacity(4s), and that by signature(yt) on the instrument the person+), or the entity upon behalf of which the person(tx) acted, executed the instrument, his/~ he/~ his/~ in certify under PENALTY OF PER JLIRY under the laws of the State of California that the foregoing paragraph is true and correct. I WITNESS my hand and official seal. Signature y7 ~ kh frf (Seal) Notary Putrfle ~ California Los Angeles County Comm. Ex iree Jan 27,2017 Legacy Heaithcare Center, LLC Guaranty-Signature Page IN WITNESS WHEREOF, the patties have duly executed and notarized this Guaranty as of the dates written below. GUARANTOR: Dated: April D ov E.Jacobs ~ 2016 i till! l,rI.III, Dated; April MitiIat~naitb ~f 2016 El IYOIRL! S I(QI-IN Notary I-'obh! Hlik! o! Idew York 'S~rg )J taty AelrnowIedgetnent Forte ls attached hereto. 8ZZ-d IZ0/800 d Z86-I Idsisstt !i dl'I 'dsliHVH 8 N!3HSNN318 3I SYH3ll 8930NYS-II098 68: I I 910 Z-91-Hdt Exhibit 3 Reeecred for clerKe Fle cramp SUPERIOR COURT OF CALIFORNIA COUNTY OF LOS ANGELES err o F('3(L., Ij!',D I o 600 Bast Btoadolay, Glankaie, CA I)'r I ll I I NDY PLAINTIFFI ROSS IX, r I 91206 rrrr'III ( (fl t ZZ01B LC DEFENI3ANTI'AVID IICFHICI Frj I ROSE GARDEN slrsACUTE a RBHAEILITATXON CENTER UNLAWFUL DETAINER STIPULATION AND JUDGMENT THE PAR'IIFS STIPLILATE 1, Judgment shall be entered In favor of plaintiff as named In the complaint and against the following defendants: (identify snd name defendants exsofi}r as Judgmentis fo bs entered Co nof abbreviate or use "efc.oar sf ai Judgment shell be entered IZ Det'endant(s) rights under lease or rental agreement are forfeited Holdover Damages Attorney fess RESERVED $ 2 Plaintiff Is awarded possession of the premises located at RESERVED $ RESERvsc Costs CA 91103 RBSEIRVED $ Defendsnt(s) security deposit, shall 1 8 99 N, RAXMCND (Inc\uding apartment number, It,apphceble); IB AVB., PASADENA, TOTAL Qv. J XrLC, A CA LTD, LXAB, CO. for', Past Due Rent 3, OEPTJCII/, s (AIRREE) AS FCLLQVVS: ROSE GARDEN SUBACUTE S REHAEXLITAT1ON CENTER, 2, cAEE NUMEER: 19GDCV01170 ff any: be returned or accounted fcr by plaintiff within 21 days after defendant(s) vacate the premises (Civ, Code, $ 1950,5), 3 shall be retained by the plaintiff snd defendant(s) waive(s) any claim to its return. 4. Judgment shall be snteredj 0 now 9'"y n««s«» «Iudgms t ss follows: e writ of possesslon may bs Issued forthwith but no fjnsilccXoul prl rto (date) (EFI 6. only upon default by defendant(s) ln the performanos of any of the obligations required by this stipulation. Defendant(s) agree(s) to vacate ths sub)sct premises by covered by this stipulation, LACIV 126 (Rsv. 01/07) LASC Approved 09-06 DI8TRIBUTICN: Original-Caurt Csss File , Copy- Plaintif removing all personal property and persons Cade clv, Proc, Copy- Defendant UNLAWFUL DETAINER STIPULATION AND JUDGMENT 55 416.48, 604 Clv, Cade, 9 Attachment 1 payment of Arrears/Reinstatement of Tenancy: Defendant agrees to pay and Plaintiff shall accept the following sums on the following dates.'163,578.81 on or before 11/12/2019; $ 97,330,19 on or before 12/1/2019; $ 97,330.19 on or before 01/01/2020; $ 97,330.19 on or before 02/01/2Q20; $ 97,330,19 on or before 03/01/202Q; $ 97,330.19 on or before 04/01/2020I payments must be made In certified funds {cashier's check or bank wire), no later than each of the payment due dates set forth above. Time Is of the essence, in the event that Defendant fails to timely tender any payment as provided herein, in full, by the 5'" calendar day following each of the payment due dates, Plaintiff may move for entry of Judgment for possession, any and all past due rents, holdover damages, costs and fees associated with this action, upon 48 Hours ex parte notice to Defendant's counsel. Plaintiff to provide wiring instructions upon execution of this agreement, Should Defendant choose to make any payment via bank wire, Defendant shall provide proof of wire transfer via email to kbsitemanPsiteman{awarouo,corn no later than each of the payment due dates, Acceptance of any sum shall not reinstate or create a new tenancy unless and until the total sum of $ 650,229.76 Is paid, In full, on or before April 1, 2020, Said sum represents all past due rents, holdover damages, costs, penalties, attorney's fees, relrnbursement of April 2019 property taxes, banl&lng and late fees, presently calculated upon execution of this agreement, through April 30, 2020, Upon timely tender of all payments as provided herein, tenancy shag be reinstated, All payment of property Taxes; parties acknowledge that property taxes shall become due and owing no later than December 10, 2019, Defendant agrees to timely pay all property taxes In full, no later than the payment due date. Should Defendant become de)inquent on December 2019 property taxes for any reason, for any period of time, Defendant shall be ln material breach of this agreement, Defendant shall furnish to Plaintiff proof of payment of said property taxes within five (5) calendar days of the payment due date. Payment of t2A Fees: Within sixty (60) days of execution of this Agreement, Defendant agrees to either, become current on ail OA fees presently due and owing or negotiate a payment plan for said fees, by way of separate agreement between the parties, Defendant shall remain current on its previous payment plan for QA fees due and owing under the prior operator's tenure, Guarantors: Within ten (10} calendar days of the execution of this Agreement, Defendant shall provide a valid address and telephone number for both Guarantors of the underlying April 16, 2016 Lease Agreement. Compliance with Lease Agreement: ln performance of this Agreement, Defendant agrees to remain full compliance with all monetary obligations of the April 16, 2016 Lease Agreement, Defendant's violation of any monetary obligation therein shall trigger an event of default under this Agreement, In Termination of Lease/Abandonment; in the event that the Lease is terminated for any reason or the Tenant abandons the Faclgty, the Tenant weal, without any remuneration, allow the next operator to operate the Facility and use the llcen'sed reimbursement agreements in order to provide an orderly transition for the residents to the new operator, In such circumstance, any personal property left by Defendant after vacating shall be deemed abandoned, and may be disposed of by plaintiff at its sole discretion. There shall be no further stays or extensions on any lockout (CCP section 918 or otherwise}, except under CCP section 1179, Defendant agrees to surrender the premises in its present condition and shall not intentionally or maliciously damage the premises. Default: In the event that Defendant violates any provision of this Agreement, Plaintiff may move for entry of Judgment for possession, any and all past due rents, holdover damages, costs and fees associated with this action, as well as any other relief this Court may deem appropriate, upon 48 Hours ex parte notice to Defendant's counsel, Time is of the essence with respect to all obligations under this Agreement, Violation of any term shag be deemed a material breach. Enforcement of Th'is Agreement: Upon execution of this Agreement, Plaintiff agrees to dismiss the Instant action, without pre)udice with this Court retaining jurisdiction per CCP section 664.6, to enforce all terms of this Agreement. Release of Claims: Upon timely tender of ag payments as provided herein and compliance with all other terms of this Agreement, Plaintiff agrees to release Defendant against any and all claims relating to non-payment of rent associated with LASC ff 19GDCV01170, Signatures: This Agreement may be executed In any number of counterparts, The parties agree that facsimile signature shall have the same force and effect as an original signature. a Plaintiff and defendant(s) further stipulate as failows: a, C3 Defendant(s) agree(s) to pay the amount Eat forth In paragraph 2 on the schedule set forth below. In dte even(of de(suit In payment, 6 writ of execution may bs Issued far the remaining balance on the Judgment oredltor'6 verified applloat)DR, without further notice or hearing. 7, El waivER alp RIGHTs: we, the undersigned defendants, understand that we have the following rlghta.'s) to bs repreEentsd by an attarnsy of aur own chaise, at aur own expense; snd (b) tc notice and an oppartun)ty to be heard on the Issue of any default In payment of Installments, or on any ether alleged violet!Dn of oonditlons staying the snforcamant of the Judgment, We give up these rights End freely agree that Judgment may be ante)sd against u6 In accordance with this stipulation, E, DEteI'. D scknawledge(s) recslmng assistance fram a. (name(s)) „„,LLl~~,y IC7'j IEngusga interpreter In the preparation and exsoutlon af this EtlpulEtlon,, J j-..(-F='jh UI '::».~j(~=./&~I 'C..~ OR PRINT NA/Aa Ryr Dele,'YPE I ')ONATORE OF PLAINTIFF OR ATTORNEY) ()j (TYPE OR PRINT NAAIE) DE(6) f- /-.'t-'.~T"."'0»',.'~'TYPE 9. (EIONATURE OF DEFENDANT OR ATIORNEY) (TYPE OR PRET T NAIE EI (9)ONATURE OF DEFENDANI'R A)TORNEY) DR PRINT NAYIE) (8)ONATURE OF DEFENDANT OR ATTORNEY) Q The court hereby ordsrE tha Shove named partiaa to comply with ths terms of the stipulation, and the clerk Is directed to enter this stipulation as judgment, ade to the af bavin (jrj (Co v. 3 I af the cou air.tiff is gment as to al gra nant /(5 I Proc., g above named pert)as agree to abide by(he terms of ths st)pu)stion which st dismissal or entry of judgment an E3 The DATED LAC IY/ 136 (Rev. 01/07) LASDApprovsd 034)B ls approved by the court, The in Department OEEE ((t j(/t ( ls 66]endarsd for s~e ~xT- YAW JUDICIAL OFFICER Dodo a)Y, Proc„ BISTfdBIITIGNIDrlglnsi-Sou/tDBEOFIIE Ocpy-PIE)nlirf Copy-DEfendant UNLAWFUL DETAJNER STIPULATlON AND JUDGMENT fa 4)6NE, 664.6 CIY Code,g)550 PEOE 2 Of 2 Plaintiff and defendant(s) further stipulate B. ea follows: SBB ATTAC}(P)a}FT 2 7. Q Defendant(s) agree(s) to pay ths amount set forth!n Paragraph 2 on the schedule set forth below, In the event of default In payment, a writ of execution may bs issued for the remaining balance on the Judgment creditor's verified application, without furth( notice or hearing. B, @ WAIVER OF RI(BHTS: We, the undersigned defendants, understand that we have the following rights; (e) to be represented by attorney of our own choice, et our own expense; and (b) to notice and an opportunity to be heard on the issue of eny default in payment of installments, or on any other alleged v(elation of conditions staying the enforcement of the Judgment. We give up thss( rights and freely agree that Judgment may be entered against us in accordance with this stipulation. acknowledge(s) receiving assistance from s {name fs)) 4 stipulation, In th Isn(gyakIe I(Is(t)rater (TYPE OR PRINT NAME) Ds(E: Data Date; R ATTORNEY) {TYPE OR PRINT NAVE) (EIONATURE OF OEFENOANI OR ATTORNEY) (TYPE CR FRINT NAEIE} (EION~ATUR OF OEFENOANI OR ATTORNEY) {TYPE OR PRIN'I NAVE} (SIO OF OEF ENOAIO OR AlTORNEY) NATURE ~ Court hereby orders ths above named parties to comply w)6) ths terms of the stipulation, and the clerk Is directed to enter this stipulation as Judgment. JJ/ o all nam ffle o gra s court, P udg . ths satlsfac Pr vlng been ((j f 416.46.) ode CI . Q The The above named parties agree to abide by the terms of ths stipulation which Is approved. by the court. Ws-OEEEFfsnmt~ I'cr — JUDIC(AL OFFICER DATED LAC(V 166 (Rsv. O(/OT) LA6C Approved 0()4}6 DIBTRIBUTIDNI Original -JFPDspaFSR -,;; - Court OEEE File Copy - Plaintiff CE(4 CIY. Copy - Dsfsodanl UNLAWFUL l3ETAJNER STIPULATION AND JUDGNIENT Pros, 22 414.44, c)v. cadi I F8982 ( Exhibit 4 SUPERIOR COURT OF CALIFORNIA COUNTY OF LOS ANGELES Ilcecrvcd far orcdir Flic stoma f'I USE ADDRESS'. PLAINTIFF'. East Broadway, Gleadalar 600 ARLENE H. ROSALEB, TRUSTEE, CA II. II..I~I! I I 91306 NQV ato. at al. iolL'r(trilrr DEFENDANTr M'r ror rrr LEGACY HEALTHCARE CENTER, LLC I & ' '(2 ', 'll i 4I ) lr)IICDI ilr 'L01IJ rc L I I'Ittrtlrtba I CASE NUMB UNLAWFUL DETAINER STIPULATION AND JUDGMENT lgGDCVC THE PARTIES STIPULATE (AGREE) AS FOLLQWSI', Judgment shall be entered In favor ofpialntfffas named In the complaint and against the following defendants, I'(den(if)r end name defendants exactly as judgment fs fo be erifered. Do nof ebbrevfsle or use 'efo." or ef ef ') LEGACY HEALTHCARE CENTER, 2. Judgment shall be entered P t D R t 3. $ RESERVED LZAB, CO, RESERVED Costs RESERVED $ Defendant(s) security deposit, Id) Defendant(s) rights under lease or rental agreement sre forfeited RESERVED Attorney fess TOTAI CA LTD. for: $ I-loldover Damages LLC, A RESERVED If Irr) Plaintiff is awarded possession of the premises located at (Including apartment number, OAKS AVE., PASADENA, If appllcsbtey. CA 15'I0 N PA1R 91103 any: g shall be returned or accounted for by plaintiff within 21 days after defendant(s) vacate ths premises (civ, code, g 1030,3), shall be retained by the plaintiff snd defendant(s) waive(s) any claim to Its return, 4. Judgment shall be entered: U now Q now and stay enforcement of)udgment as follows: a writ of possession mey be Issued forthwith, but no final lockout prior to (date) 2 only upon default by defendant{0) in ths performance of any of the obligations required by this stipulation, 3, Q Defendant(s) agree(s) to vacate the subject premises by , covered by this stipulation. LACIV 130 (Rev. 01/07) LASC Approved 00.05 DISTRIBUTION, Original-Ccurl Case Flic COpy- Plaintiff removing all personal property snd persont Cade Clv, Proc., 00 415,45, 854. Clv, Code, 0 COpy-Defendant UNLAWFUL DETAINER STIPULATION AND JUDGMENT Page 1 of 2 Attachment 1 payment of Arrears/Reinstatement of Tenancy: Defendant agrees to pay and Plaintiff shall accept the following sums on the following dates: $ 72,213,80 on or before 11/12/2019; $ 52,330,04 on or before 12/1/2019; $ 52,330.04 on or before 01/01/2020; $ 52,330,04 on or before 02/01/2020; $ 52,330.04 on or before 03/01/2020; $ 52,330,04 on or before 04/01/2020; payments must be made in certified funds (cashier's check or banl& wire), no later than each of the payment due dates set forth above. Time ls of the essence, In the event that Defendant falls to timely tender any payment as provided herein, in fuII, by the 5'" calendar day following each of the payment due dates, Plaintiff may move for entry of Judgment for possession, any and all past due rents, holdover damages, costs and fees associated with this action, upon 48 Hours ex parte notice to Defendant's counsel. Plaintiff to provide wiring Instructions upon execution of this agreement, Should Defendant choose to mal&e any payment via bank wire, Defendant shall provide proof of wire transfer via email to kbsiteman@sitemaniawxroua,corn no later than each of the payment due dates, Acceptance of any sum shall not reinstate or create a re@tenancy unless and until the total sum of $ 333,864.00 is paid, in full, on or before April 1, 2020, Said sum represents all past due rents, holdover damages, costs, penalties, attorney's fees, reimbursement of April 2019 property taxes, banking and late fees, presently calculated upon execution of this agreement, through April 30, 2020, Upon timely tender of all payments as provided herein, tenancy shag be reinstated. All Payment of Property Taxes: Parties acknowledge that property taxes shall become due and owing no later than December 10, 2019. Defendant agrees to timely Pay atl property taxes in full, no later than the payment due date. Should Defendant become delinquent on December 2019 property taxes for any reason, for any period of time, Defendant shall be in material breach of this agreement. Defendant shall furnish to Plaintiff proof of payment of said property taxes within five (5) calendar days of the payment due date, Payment of QA Fees. Within sixty I60) days of execution of this Agreement, Defendant agrees to either, become current on all QA fees presently due and owing or negotiate a payment plan for said fees, by way of separate agreement between the parties, Defendant shall remain current on Its previous payment plan for QA fees due and owing under the prior operator's tenure. Guarantors: Within ten (10} calendar days of the execution of this Agreement, Defendant shall provide a valid address and telephone number for both Guarantors of the underlying April 16, 2016 Lease Agreement. Compliance with Lease Agreement: In performance of this Agreement, Defendant agrees to remain full compliance with all monetary obligations of the April 16, 2016 Lease Agreement, Defendant's violation of any monetary obligation therein shall trigger an event of default under this Agreement, in Termination of Lease/Abandonment: In the event that the Lease Is terminated for any reason or the Tenant abandons the Facility, the Tenant vvIII, without any remuneration, allow the next operator to operate the Facility and use the licensed reimbursement agreements in order to provide an orderly transition for the residents to the new operator, In such circumstance, any personal property left by Defendant after vacating shall be deemed abandoned, and may be disposed of by Plaintiff at its sole cllscretlon, There shall be no further stays or extensions on any lockout (CCP section 918 or otherwise}, except under CCP section 1179, Defendant agrees to surrender the premises in its present condition and shall not intentionally or maliciously damage the premises, Default: In the event that Defendant violates any provision of this Agreement, Plaintiff may move for entry of Judgment for possession, any and ag past due rents, holdover damages, costs and fees associated with this action, as well as any other relief this Court may deem appropriate, upon 48 Hours ex parte notice to Defendant's counsel. Time is of the essence with respect to all obligations under this Agreement. Violation of any term shall be deemed a material breach, Enforcement of This Agreement: Upon execution of this Agreement, Plaintiff agrees to dismiss the instant action, without prejudice with this Court retaining}urisdiction per CCP section 664.6, to enforce all terms of this Agreement, Release of Claims: Upon timely tender of all payments as provided herein and compliance with all other terms of this Agreement, Plaintiff agrees to release Defendant against any and all claims relating to non-payment of rent associated with LASC ff 19GDCV01180. Signatures: This Agreement may be executed in any number of counterparts, The parties agree that facsimile signature shall have the same force and effect as an original signature, a plaintiff and defendant(s) further stipu ate as 6. fol(cws.'EE ATTACHMENT 1 Defendant(s) agree(s) to pey ths amount Sel fcr!h in Paragraph 2 on the schedule set forth below, In the event of default in payment, s writ of execution may be Issued for ti:6 remaining balance on the judgment creditor'6 verified application, without further not)os or hearing. Q WAIVER OF RIGHT6; Ws, ths underslgns(i defendants, understand that we have the following rights; (a) to be represented by sn attorr)sy of our own choice, at our own expense; snd (b) to nct)ce snd an opportunity to be heard on the issue of any default in payment of installments, or on sny other alleged violation of conditions staying ths enforcemsnt of ths Judgment, we give up Ihese rights and freely agree that judgment may ba entered against us in accordance with this stipulation. 0, acknowledge(s) receiving assistance from s (name(6]) language interpreter in the preparation and execution pf,this stlpulstlon, y4. IorFLv.f%r Fr)IFA~ Date: f l n r) r"-:.)-')J :(rr.2-'r~.~; "& (SIGNATURE OF DEFENDANT OR ATTORNEY) (T YFE OR PR.'NT NANS} Date.'ate,'TYFE OR PRIS(RANE) (SIGNATURE OF DEFENDANT OR ATTORNEY) (T YPE OR PRINT NANE! (SIGNATURE OF DEFENDANT OR ATTORNEY) Q The Court hereby orders the above na(ped parties tc comply with the terms of the stipulation, and the clerk stlpuletlon as judgment, ade to Ihe satisf Zj P of having (Co eClv roc.,()4 . 8,) ', 'the cour, PIS)nttff )6 als dgment as unns Is dlrectsd to enter this lenanle. above named parties agree to abide by ths lerms of the stipulation which ls approved by the court. The case + Ths In Department at dismissal or entry of judgment on DISTRIBUTIDFh Gdgirsl &(jiff Calendared for JUDICIAL OFFICER DATED LACiv 138 (Rev. Ct/07) IARC Approved 09.06 Is Wi — Cour)Csee File Copy-Plaintiff code Copy — Dsfendsnl UNLAWFUL DETAlMER 8T)PULAT)ON AND JUDGMENT c(v, Proc., 99 4(EA6, 664.6 c(v. cade, 9)66( Page 2 of 2 Plaintiff and defendant(B) further stipulate 6. BB follows; BEB AGTACNNBNT 1 Q Defendant(s) agree(s) to pay the amount set forth in Paragraph 2 on the soheduls set forth below, In the event of default in payment, a writ of execution may be Issued for tl'.e rsntalnlng balance on the judgment creditor's verified application, without further notice or hearing, P] WAIVER QF RIGHTS: We, the undersigned defendants, understand that we have the following rights.'a) to be represented by Bn attorney of our own choice, at our own expBnse,'nd (b} to notice and an opportunity to bs heard on the Issue of Eny default In payment of Installments, or on any other alleged violation of conditions staying ths enforcement of the judgment, We give up these rights and freely agree that judgment may be entered against us in accordance with this st(pulation. 6, acknowledge(s) receiving assistance from a g, (name(s)) ..... „ language interpreter in the Dnv . Jyr.nh~ Jj/j~/8 (SIGNATURE OF PIAINTlflAIR AITORNBVI Date', (SIGNATURE OF DEFENDANT OR ATTORNEV) Date,'ate: (TVP OR PRNT PVVS) (SIGNATURE OF DEFENOANT OR ATTORNEV) Palm'NAB) (SIGNATURE OF DEFENDANT ORATTORNEV) (TYPE OR The Court hereby orders the above named partles to ccmpiy with ths terms of ths stipulation, and the clerk is directed to enter this stipulation as judgment, ~TF)ofhavl (Gott(L(PI . esatlsfa snmsde Proc„, fthscou sn isslso I'dju antes u arned an . CP I ill) 6.) jj(gI j The above named parties agree to ab:ds by ths terms of the stipulation which ls approved by the court. Tilrrcess(BNsstenderedqsp IBRTIBBTT)TPPTTRIFFNBP)udglnen .T. iO=. ~li~lzg JUDICIAL OFFICER DATED LACIV 1 36 (Rsv. Ot/07) LASC Approved 00-05 DISTRIBUTION: Original- Courl Csss File coseov. I roo„gg A(E,AE, EEA clv. coso, 1 Copy — Defendant JUDGMENT Page 2 of 2 Copy-Plaintiff UNLAWFUL DETAINER 8TJPULAT(ON AND Exhibit 5 P) ca OIr FICES OP DENNIS P. BLOCK dr ASSOCIATES DENNIS P, BLOCI&., SBN 70194 5437 Laurel Canyon Boulevard, Second Floor Valley Village, California 91607 (323) 93 $ -2868 (323) 938-6069 fax LAV11 CL 2 co dennis evlct123,corn Chl c4 4 c) 5 FILED Superior Co)rrt ol CNilorora Couotyof LosAMuakla 01/23/2020 s))arrii)L cai)ar,a)a)CI)svaorraarl oaaarcaarl M. D, )A)rt Attorneys for Plaintiff g) o) c) tL" SUPERIOR COURT OIr THE STATE OFl CALIFCORNIA Ca FOR THE COUNTY OFI LOS ANGELES — GLENDALE COURTHOUSE c) o) a) LL) le Devi&1 Ross II, liab. co., I LC, a CA ltd. 11 'ase N'o;: 19GDCV01170 [UNLIMITED. CIVIL] Plaintiff) Qj JUDGMENT v 13 14 c) & Rose. Garden Subacute k, ltd. liab. coa and Does to 10, Rehabilitation Center, LI C) a 'CA 1 13 Defendants. 17 Whereas a Unlawful Detainer Stipulation was entered into by Plaintiff and Defendant, 49 and was filed with the Comt on November 12, 2019, and heard and reviewed evidence 20 regarding the Defendant's breach of the Stipulation at the January 23, 2020 Bx Parte Hearing to Enforce the Terms of the Stipulation; 22 The Court hereby orders that Plaintiff', have and recover from Defendarits, all of 23 the following; 24 plaintiff is awarded possessiorl of the premises located at 1899 N. Raymond Ave« Pasadena, CA 91103, cancel and forfeiture of April 16, 2016 lease agreement and 26 $ 194,158,02 in rent and'hold over damages, Attorney's fees and court cost to be -1i«««~«ani JUDGMENT "et«lnineli. bZ Motion. Fur!her, the judgment is entered pursuant to CCp Section 415,46 against all occupants 01/23I2020 'HON, CORDA, k% JUDGE 07 THE SIJPBRIOR COURT 10 VQe &05 14 ~@ 15 I Fl 18 19 20 21 22 25 26 28. Exhibit 6 x CL, LAW OF&F&ICE&S OF DENNIS P. BLOCK k ASSOCIATES DENNIS P. BLOCK, SBN 70194 5437 Laurel Canyon Boulevard, Second Floor Valley Village, California 91607 &&7 &0 cs C3 (323) 938-2868 (323) 938-6069 fax C) R dennis evict123.corn CV cs ,&o S&&l&r&art n&&&lkh«',„Er&e&&rer«orra&«& C&&&&r&e«ner«& 4 Attorneys for Plaintiff 7C FILE I3 gqporter Coo&a &sf California County of L4&s Ar Its foa &MI231I202CI By'... 1 M. D, &f«lo'll 0 5 &r& &o 6 Z 7 SUPERIOR COURT OF THK STATE OF CALIFORNIA &e 8 FOR THK COUNTY OF LOS ANGE&LES — GLE&NDALE COURTHOUSE c& 9 &L& LLI 10 r C« 9A Arlene H. Rosales, Trustee of the Arlene Rosales Living Trust Dated February 2, 2012, Case No,: 19GDCV01180 [UNLIMTED CIVILj rrrrrrrrrr &rrrrr] JUDGMENT 12 Plaintif'f; 14 Legacy Health Care Center,LLC..i a CA ltd. liab Co., and Decal to «& M 'r&r 4 g~a E L& o~ &7 „. tlW 10, r&& 9$ r& IW 16 4 Defendants. 17 la Whereas a Unlawful Detainer Stipulation was entered into by Plaintiff and Defendant, 19 and was filed with the Court on. November 12, 2019, and heard and reviewed evidence 20 regarding the Defendant's breach of the Stipulation at the January 23, 2020 Ex Parte 21 Hearing to Enforce'the Terms of the Stipulation; 22 The Court hereby orders that Plaintiff, have and recover from Defendants, all of the following. 24 Plaintiff is awarded possession of the premises located at 1570 N. Fair Oalcs Ave., 26 Pasadena, CA 91103, cancel and forfeiture of April 16, 2016 lease agreement and 26 '126,118.72 in rent and hold over damages, Attorney's fees and court cost to be 27 jr rrrrrs r&S r"rr1 SUDGNg&NT determined by Motion. Further, the judgment is entered pursuant to CCp Section 415.46 against all occupants IIO kk@uk'iV~% JUDGE OP TICE SUPERIOR COURT 10 o 's g 8 ~ m g gio vo„. 0 13 14 15 e Vl M A ) 16 17 18 20 21 22 23 25 26 28 I suDG34ENT