TRANSACTION DISCUSSION Purchase and Sale Agreements – major issues: title, survey, zoning, property condition, environmental, licensure and change of ownership (issues and timing); stock vs. asset transaction; Due Diligence: financial underwriting: EBITDAR, occupancy; operational history; payors (government and private pay), third party rent; condition of facility; capital improvements required; related or unrelated operator; market, geography and reputation; labor and employment and benefits; tax; regulatory. Organizational Structure: OPCO/PROPCO Lease for operations? Operations Transfer Agreement
LOAN DISCUSSION Loan Documents. Note, mortgage, AL&R, guaranty, pledge, environmental indemnity; Co-lenders? Financial Covenants. Loan to Value Occupancy Fixed Charge Others Underwriting of facility, buyer and operator. Underwriting of transaction;
OTHER ISSUES What slows down transaction? Are there any conditions that MUST be satisfied for the acquisition and financing transactions to close? Licensure approval or interim lease or management arrangement. State by state discussion. Any special: (a) documentation requirements, (b) insurance issues, (c) regulatory approvals, (d) timing concerns, (e) legal opinions, (f) other issues? Is Mezzanine Debt typically involved? How is the debt structured (e.g., second mortgage debt or pure mezzanine debt)?