Phoebe Putney Memorial Hospital approves subordination agreement for property near Phoebe North

Agreement allows doctor to set up practice near Phoebe North

Phoebe Putney Memorial Hospital

Phoebe Putney Memorial Hospital

ALBANY — Aside from approval of its Form 990, the full board of Phoebe Putney Memorial Hospital had a packed agenda on Wednesday that also included a subordination agreement regarding a property near Phoebe North.

The agreement is between the Hospital Authority of Albany-Dougherty County and Dr. Jonathan Payne, and concerns a piece of property just north of the Palmyra Road campus that, while not included in the $195 million transaction of the hospital, the Hospital Authority has a title conveyance. It is currently owned by Ruth H. Crouch, and Payne has expressed interest in entering into an agreement with Crouch covering the property by which he will either purchase, lease or lease with the option to purchase, available documentation on the agreement shows.

The right of first refusal, said Tommy Chambless, senior vice president and general counsel for Phoebe Putney Health System, belongs to the Authority. The agreement accommodates Payne in acquiring either an ownership or leasehold interest from Crouch.

The agreement reads, in part:

“The Authority hereby specifically subordinates its Right of First Refusal covering the Property to: (a) a deed of conveyance of the Property from Crouch to Payne, or to a lease or lease-purchase agreement covering the Property between Crouch as landlord and Payne as tenant; and (b) provided Payne acquires the Property in fee simple ownership by deed of conveyance from Crouch, to either a first lien purchase money deed to secure debt granted by Payne to a commercial banking lender conveying the Property to said lender as collateral for a purchase money loan on the Property or to a seller-financed first lien purchase money security deed covering the Property granted by Payne back to Crouch.”

The agreement goes on to say that the subordination applies to Payne and to a corporation or limited liability company in which Payne is the majority stockholder or member should he acquire the property in an entity name rather than his individual name, and that it does not subordinate the Authority’s right to first refusal as to any other conveyance, lease, assignment or agreement for the property.

The board approved the agreement. It is expected to go before the Authority at its meeting scheduled for next week, Chambless said.

The Form 990 approved by the board Wednesday covered the fiscal year that ended in July 2013. The highlights included a total revenue of $524.26 million the previous year and $517.52 million during that fiscal year.