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ENVIRONMENTAL INDEMNITY
AGREEMENT
This
Environmental Indemnity Agreement (this “ Agreement
”), which is dated as of June 24, 2008, is executed by
G&E HEALTHCARE REIT ACADEMY, LLC, a Delaware limited liability
company (“ Academy Borrower ”), and GRUBB &
ELLIS HEALTHCARE REIT, INC., a Maryland corporation (“
Indemnitor ”), in favor of WACHOVIA FINANCIAL
SERVICES, INC., a North Carolina corporation, as administrative
agent for the “Lenders” pursuant to the Loan Agreement
described below (in such capacity, “ Administrative
Agent ”) and in favor of each party that now or hereafter
is bound under the Loan Agreement as a “Lender”
(referred to herein individually as a " Lender ” and
collectively as “ Lenders ”).
RECITALS
A. Lenders have agreed upon certain conditions to make a loan
to Academy Borrower, G&E Healthcare REIT 5995 Plaza Drive, LLC,
a Delaware limited liability company, G&E Healthcare REIT Epler
Parke Building B, LLC, a Delaware limited liability company,
G&E Healthcare REIT Nutfield Professional Center, LLC, a
Delaware limited liability company, and G&E Healthcare REIT
Medical Portfolio 2, LLC, a Delaware limited liability company
(collectively, “ Borrower ”), in the maximum
principal amount of up to Fifty Million Three Hundred Twenty-One
Thousand Five Hundred and No/100 Dollars ($50,321,500.00) (“
Loan ”), which Loan is evidenced by one or more
promissory notes, each now or hereafter executed by Borrower to one
or more Lenders, in the aggregate principal amount of
$50,321,500.00 (“ Notes ”), and which Loan and
Notes are secured by, among other documents, that certain Deed of
Trust, Assignment of Rents and Leases, Security Agreement and
Fixture Filing (“ Deed of Trust ”) of even date
herewith, executed by Academy Borrower for the benefit of
Administrative Agent, encumbering certain real and personal
property as therein described (collectively, the “
Property ”), including the land described in
Exhibit A which is attached hereto and made a part
hereof; and
B. Borrower has entered into a Loan Agreement (“ Loan
Agreement ”) with Administrative Agent and Lenders,
relating to the Loan; and
C. Administrative Agent is acting as the agent for all of the
Lenders now or hereafter existing under the Loan Agreement; and
D. Lenders have refused to make the Loan to Borrower unless
this Agreement is executed by Academy Borrower and Indemnitor and
is delivered to Administrative Agent (on behalf of Lenders).
NOW,
THEREFORE, in consideration of Administrative Agent’s and
Lenders’ entering into the Loan Agreement and of other good
and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged by Academy Borrower and Indemnitor, Academy
Borrower and Indemnitor hereby agree that the foregoing recitals
are true and correct and are by this reference hereby made a part
hereof as if fully set forth below, and further covenant and agree
with Administrative Agent and Lenders, and their respective
successors and assigns, as follows:
1.
Certain Definitions . As used in this Agreement:
"
C.C.P. ” means the California Code of Civil Procedure,
as amended from time to time.
"
Claim ” means any controversy or claim between one or
more Obligors and Administrative Agent or any Lender, whether
arising in contract or tort or by statute, that arises out of or
relates to this Agreement, including any renewals, extensions or
modifications hereof.
"
Cut-Off Date ” means the earlier of the following two
dates: (a) the date on which the indebtedness and obligations
secured by the Deed of Trust have been paid and performed in full
and the Deed of Trust has been released; or (b) the date on
which the lien of the Deed of Trust is fully and finally foreclosed
or a conveyance by deed in lieu of such foreclosure is fully and
finally effective and possession of the Property has been given to
and accepted by the purchaser or grantee free of occupancy and
claims to occupancy by Obligors and their heirs, devisees,
representatives, successors and assigns; provided, however, that if
such payment, performance, release, foreclosure or conveyance is
challenged in proceedings under any Debtor Relief Law or otherwise,
the Cut-Off Date shall be deemed not to have occurred until such
challenge is validly released, dismissed with prejudice or
otherwise barred by law from further assertion.
"
Debtor Relief Law ” means any federal, state or local
law, domestic or foreign, as now or hereafter in effect relating to
bankruptcy, insolvency, liquidation, receivership, reorganization,
arrangement, composition, extension or adjustment of debts, or any
similar law affecting the rights of creditors.
"
Default ” has the meaning ascribed to such term in the
Deed of Trust and includes any breach of any covenant,
representation or warranty and any other default under this
Agreement, subject to any applicable notice and cure period.
"
Default Rate ” is the rate set forth in the last
sentence of Section 2.3(b) of the Loan Agreement.
"
Environmental Assessment ” means a report (including
all drafts thereof) of an environmental assessment of the Property
of such scope as may be requested by Administrative Agent or
another Indemnified Party, including the taking of soil borings and
air and groundwater samples and other above- and below-ground
testing, by a consulting firm acceptable to such Indemnified Party
and made in accordance with the established guidelines of such
Indemnified Party.
"
Environmental Claim ” means any investigative,
enforcement, cleanup, removal, containment, remedial or other
private or governmental or regulatory action at any time
threatened, instituted or completed pursuant to any applicable
Environmental Requirement, against Academy Borrower or any Obligor
against or with respect to the Property or any condition, use or
activity on the Property (including any such action against any
Indemnified Party), and any claim at any time threatened or made by
any person against any Obligor or against or with respect to the
Property or any condition, use or activity on the Property
(including any such claim against any Indemnified Party), relating
to damage, contribution, cost recovery, compensation, loss or
injury resulting from or in any way arising in connection with any
Hazardous Material or any Environmental Requirement.
"
Environmental Damages ” means all claims, demands,
liabilities (including strict liability), losses, damages
(including consequential damages), causes of action, judgments,
penalties, fines, reasonable costs and expenses (including
reasonable fees, costs and expenses of attorneys, consultants,
contractors, experts and laboratories), of any and every kind and
character, contingent or otherwise, matured or unmatured, known or
unknown, foreseeable or unforeseeable, made, incurred, suffered,
brought, or imposed at any time and from time to time, and arising
in whole or in part from any of the following matters, regardless
of whether caused by an Obligor or a tenant or subtenant, or a
prior owner of the Property or its tenant or subtenant, or any
third party:
(a) The
presence of any Hazardous Material on the Property, or any escape,
seepage, leakage, spillage, emission, release, discharge or
disposal of any Hazardous Material on or from the Property, or the
migration or release or threatened migration or release of any
Hazardous Material to, from or through the Property, on or before
the Cut-Off Date; or
(b) Any
act, omission, event or circumstance existing or occurring in
connection with the handling, treatment, containment, removal,
storage, decontamination, cleanup, transport or disposal of any
Hazardous Material which is or was present on the Property on or
before the Cut-Off Date; or
(c) The
breach of any representation, warranty, covenant or agreement
contained in this Agreement because of any event or condition
occurring or existing on or before the Cut-Off Date; or
(d) Any
violation relating to the Property on or before the Cut-Off Date,
of any Environmental Requirement in effect on or before the Cut-Off
Date, regardless of whether any act, omission, event or
circumstance giving rise to the violation constituted a violation
at the time of the occurrence or inception of such act, omission,
event or circumstance; or
(e) Any
Environmental Claim, or the filing or imposition of any
environmental lien against the Property, because of, resulting
from, in connection with, or arising out of any of the matters
referred to in the preceding clauses (a) through (d).
Without
limiting the generality of the foregoing, “ Environmental
Damages ” includes: (i) the investigation or
remediation of any such Hazardous Material or violation of any such
Environmental Requirement, including the preparation of any
feasibility studies or reports and the performance of any cleanup,
remediation, removal, response, abatement, containment, closure,
restoration, monitoring or similar work required by any
Environmental Requirement or necessary to have full use and benefit
of the Property as contemplated by the Loan Documents (including
any of the same in connection with any foreclosure action or
transfer in lieu thereof); (ii) injury or damage to any
person, property or natural resource occurring on or off the
Property, including the cost of demolition and rebuilding of any
improvements on real property; (iii) all liability to pay or
indemnify any person or governmental authority for costs expended
in connection with any of the matters included within this
definition of Environmental Damages; (iv) the investigation
and defense of any claim, whether or not such claim is ultimately
defeated; and (v) the settlement of any claim or judgment.
"
Environmental Law ” means any federal, state or local
law, statute, ordinance, code, rule, regulation, license,
authorization, decision, order, injunction, decree, or rule of
common law, and any judicial interpretation of any of the
foregoing, which pertains to health or safety (as they relate to
natural resources or the environment), any Hazardous Material, or
the environment (including ground or air or water or noise
pollution or contamination, and underground or aboveground tanks)
and shall include the Solid Waste Disposal Act, 42 U.S.C.
§ 6901 et seq.; the Comprehensive Environmental
Response, Compensation and Liability Act of 1980, 42 U.S.C.
§ 9601 et seq. (“ CERCLA ”), as
amended by the Superfund Amendments and Reauthorization Act of 1986
(“ SARA ”); the Hazardous Materials
Transportation Act, 49 U.S.C. § 1801 et seq.; the
Federal Water Pollution Control Act, 33 U.S.C. § 1251
et seq.; the Clean Air Act, 42 U.S.C. § 7401
et seq.; the Toxic Substances Control Act, 15 U.S.C.
§ 2601 et seq.; the Safe Drinking Water Act, 42
U.S.C. § 300f et seq.; California Health and Safety
Code § 25100 et seq.; the Arizona Environmental
Quality Act, Title 49, Arizona Revised Statutes; and any other
state or federal environmental statutes, and all rules,
regulations, orders and decrees now or hereafter promulgated under
any of the foregoing, as any of the foregoing now exist or may be
changed or amended or come into effect in the future.
"
Environmental Requirement ” means any Environmental
Law, agreement or restriction, as the same now exists or may be
changed or amended or come into effect in the future, which
pertains to health or safety (as they relate to natural resources
or the environment), any Hazardous Material, or the environment,
including ground, air, water or noise pollution or contamination,
and underground or aboveground tanks.
"
Hazardous Material ” means any substance, whether
solid, liquid or gaseous: (a) which is listed, defined or
regulated as a “hazardous substance”, “hazardous
waste” or “solid waste”, or otherwise classified
as hazardous or toxic, in or pursuant to any Environmental
Requirement; or (b) which is or which contains asbestos,
radon, any polychlorinated biphenyl, urea formaldehyde foam
insulation, explosive or radioactive material, or motor fuel or
other petroleum hydrocarbons; or (c) which causes or poses a
threat to cause a contamination or nuisance on the Property or any
adjacent property or a hazard to the environment or to the health
or safety of persons on the Property.
"
Indemnified Party ” means each of the following
persons and entities: (a) Administrative Agent;
(b) Lenders or any subsequent holders of the Notes;
(c) Trustee; (d) any persons or entities owned or
controlled by, owning or controlling, or under common control or
affiliated with, Administrative Agent, Lenders, any subsequent
holders of the Notes, and/or Trustee; (e) any participants and
co-lenders in the Loan; (f) the directors, officers, partners,
employees, attorneys and agents of each of the foregoing persons
and entities; and (g) the heirs, personal representatives,
successors and assigns of each of the foregoing persons and
entities.
" Loan
Documents ” has the meaning ascribed to such term in the
Deed of Trust.
"
Obligor ” means any individual Academy Borrower or
Indemnitor and “ Obligors ” means some or all of
the persons and entities comprising Academy Borrower and/or
Indemnitor, collectively.
"
On ” or “ on ”, when used with
respect to the Property or any property adjacent to the Property,
means “on, in, under, above or about.”
"
Trustee ” means the Trustee under the Deed of
Trust.
2.
Representations and Warranties . Each Obligor hereby
represents and warrants to, and covenants with, Administrative
Agent and Lenders, that, except as disclosed in that certain Phase
1 Environmental Site Assessment Report provided to Administrative
Agent in connection with the closing of the Loan, as of the date of
reco
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