Exhibit 10.1
EXTENSION AGREEMENT
THIS EXTENSION AGREEMENT (this "Agreement"), dated as
of May 31, 2001, is made by and between EMERITUS PROPERTIES II,
INC., EMERITUS PROPERTIES V, INC., EMERITUS PROPERTIES VII, INC.,
each a Washington corporation (the "Original Borrowers"),
EMERITUS PROPERTIES III, INC., a Washington corporation (the
"Additional Borrower", together with the Original Borrowers, each
a "Borrower" and collectively, the "Borrowers"), each having an
address c/o Emeritus Corporation, 0000 Xxxxxxx Xxxxxx, Xxxxx 000,
Xxxxxxx, Xxxxxxxxxx 00000 and DEUTSCHE BANK AG, a bank chartered
under the laws of the Federal Republic of Germany, acting by and
through its New York Branch (together with its successor and
assigns, the "Lender"), having an address at 00 Xxxx 00xx Xxxxxx,
Xxx Xxxx, Xxx Xxxx 00000 with reference to the following facts:
RECITALS
A. Original Borrowers are indebted to Lender under that
loan (the "Original Loan") made under that certain Credit
Agreement by and among the Original Borrowers and Lender, dated
as of April 29, 1998, pursuant to which Lender made a loan to
Original Borrowers in the original principal amount of Fifty-Six
Million Two Hundred and Eighty Six Thousand and No/100 Dollars
($56,286,000.00) (the "Original Credit Agreement").
B. Original Borrowers and Additional Borrower are indebted
to Lender under that loan (the "Additional Loan", and together
with the Original Loan, the "Loan") made under that certain
amendment to the Credit Agreement captioned "Amendment to Credit
Agreement and Restatement of Article IX" by and among the
Original Borrowers, the Additional Borrower and Lender, dated as
of June 30, 1998, pursuant to which Lender amended the Original
Credit agreement by, among other things, adding the Additional
Borrower as a borrower and loaning the Original Borrower and the
Additional Borrower an additional Sixteen Million Nine Hundred
and Forty-Nine Thousand and No/100 Dollars (($16,949,000.00) (the
"Amended Credit Agreement", together with the Original Credit
Agreement, the "Credit Agreement").
C. The Loan is evidenced by those certain Notes (the
"Notes") and secured by, among other things, those certain
Mortgages and Deeds of Trust (including amended and restated
mortgages, mortgage modifications and assignments of mortgages)
(the "Mortgages"), Security Agreements (the "Security
Agreements"), Guarantees and Indemnities (the "Guarantees")
executed in connection with the Loan. The Mortgages encumber
those certain properties more particularly described therein
(collectively, the "Properties," and each individually, a
"Property"). The Properties are owned by Borrower. The Notes,
Mortgages, Security Agreements, Guaranties and all other
documents and agreements evidencing, securing, or otherwise
relating to the Loan (including this Agreement and the Credit
Agreement) are hereinafter collectively referred to as the "Loan
Documents."
D. Lender is the owner and holder of the Notes, the
beneficiary under the Mortgages and the owner of the Loan.
E. Pursuant to Sections 1.01 and 2.03 of the Credit
Agreement, the Maturity Date (as defined in the Credit Agreement)
for the Loan was April 29, 2001.
F. Borrowers and Lender entered into that certain letter
agreement (the "Pre-Negotiation Agreement") on or about January
30, 2001, a copy of which is attached hereto as Exhibit "A,"
regarding certain negotiations and discussions (the
"Discussions").
G. Borrowers and Lender also entered into that certain
Short Term Extension Agreement dated April 24, 2001, whereby the
Maturity Date of the Loan was extended to May 29, 2001, that
Second Short Term Extension Agreement, dated May 29, 2001,
whereby the Maturity Date was further extended to May 30, 2001
and that [Third] Short Term Extension Agreement, dated May 30,
2001, whereby the Maturity Date was further extended to May 31,
2001.
H. Borrowers have now requested that Lender further extend
the Maturity Date to allow Borrowers more time to pay back the
Loan in full.
I. Lender is willing to accede to such request on the
terms hereinafter set forth.
J. Capitalized terms used herein but not otherwise defined
shall have the meaning ascribed to them in the Credit Agreement.
NOW, THEREFORE, in consideration of the mutual covenants,
promises and agreements contained herein and other good and
valuable consideration, the receipt and sufficiency of which are
hereby acknowledged by the parties hereto, and intending to be
legally bound, each Borrower and the Lender agree as follows:
1. Request of Extension of Maturity Date. Borrowers
hereby request to further extend the Maturity Date of the Loan in
accordance with the terms and conditions of this Agreement.
2. Extension of Maturity Date by Lender. Subject to the
terms and conditions set forth in Section 6 hereof and all other
terms and conditions of this Agreement and the default provisions
of Section 9 hereof, Lender shall extend the Maturity Date for
all purposes under the Loan Documents as set forth herein.
3. No Waiver. The obligation of the Lender set forth in
Section 2 of this Agreement to extend the Maturity Date shall not
constitute a waiver of (i) any default under the Loan Documents
or (ii) any rights and/or remedies available to the Lender under
the Loan Documents or applicable law.
4. No Further Extension Implied. Neither the agreement of
the Lender set forth in Section 2 of this Agreement to extend the
Maturity Date, nor the performance by any of the Borrowers of
any or all of their obligations under this Agreement, shall
constitute or be deemed to constitute an obligation or agreement
on the part of the Lender, express or implied, to further extend
the Maturity Date beyond any applicable Maturity Extension
Periods, as defined below.
5. Principal Amount and Legal Fees. Borrowers hereby
acknowledge that (i) as of May 31, 2001, the outstanding
principal amount of the Loan is $73,235,000 (the "Principal") and
(ii) Lender is incurring legal fees and costs in connection with
the extension of the Maturity Date (the "Legal Fees"), including
without limitation legal fees incurred in connection with the
preparation and negotiation of this Agreement, which are properly
chargeable to Borrowers under and secured by the Loan Documents,
and that any such amount of the Legal Fees not paid to Lender's
legal counsel pursuant to Section 6(a)(iv) hereof shall be paid
to Lender's counsel within five (5) days of receipt of any
invoices from Lender's counsel.
6. Required Payments and Other Obligations of Borrowers.
(a) First Maturity Extension Period.
(i) On or before June 8, 2001, the Borrowers
shall pay to Lender in good funds the sum of $375,000
(the "First Extension Fee") in exchange for which the
Lender shall extend the Maturity Date for all purposes
under the Loan Documents, subject to the terms and
conditions of this Agreement, until December 14, 2001
(the "First Extended Maturity Date").
(ii) During the period from May 1, 2001 to the
First Extended Maturity Date (the "First Maturity
Extension Period"), the unpaid principal amount on the
Loan shall accrue interest at the rate of the
Eurodollar Rate plus 3% (the "First Extension Rate")
until the earlier of (x) the payment in full of the
outstanding principal amount of the Loan and any
accrued interest or other amount then due and owing by
the Borrowers to the Lender under or in relation to the
Loan Documents, (y) the occurrence of a default or
Event of Default (as defined below) hereunder, or (z)
the end of the First Maturity Extension Period. During
the First Maturity Extension Period, interest payments
shall continue to be due and payable under the
schedule, terms and conditions set forth in the Credit
Agreement, though at the First Extension Rate. On or
before June 5, 2001, Borrowers shall pay an interest
payment to the Lenders equal to the interest payment
they would have paid under the Credit Agreement on such
date if interest on the principal amount of the Loan
had continued to accrue at the non-default rate (the
"June 5 Interest Payment"). On or before June 8, 2001,
Borrowers shall pay the difference between the June 5
Interest Payment and the interest payment on the Loan
that would have been due and payable on June 1, 2001
calculated under the First Extension Rate. Interest
payments thereafter shall be made by the applicable
Interest Payment Date at the then applicable interest
rate under this Section 6.
(iii) On or before June 8, 2001 and on the
first day of each month thereafter during the period
from June 1, 2001 through and including May 1, 2002,
the Borrowers shall also pay in good funds additional
principal payments in the amount of $200,000 per month
(the "Additional Principal Payments") that shall reduce
the overall amount of the Principal correspondingly
upon Lender's receipt of each payment; provided,
however, that such Additional Principal Payments shall
be deemed to be allocated toward the Allocated Loan
Amount of either (x) the Concorde, Las Vegas, Nevada
property (the "Concorde Property") or (y) any other
Property at the Lender's sole discretion; provided
Lender provides notice to which Property such
Additional Principal Payments shall be allocated.
Accordingly, for purposes of effecting a Partial
Release pursuant to Section 8.02 of the Credit
Agreement, such Additional Principal Payments shall
only be credited toward the Release Price of the
Concorde Property or the Release Price of such other
Property as Lender chooses in its sole discretion.
(iv) On or before June 8, 2001, the Borrowers
shall pay to Lender's counsel, Steptoe & Xxxxxxx, LLP,
in good funds the sum of $20,000.00 as partial payment
for Lender's legal fees and expenses in connection with
the extension of the Maturity Date.
(b) Second Maturity Extension Period
(i) At any time on or before the First Extended
Maturity Date, as long as there is no default or Event
of Default (as defined hereinafter) hereunder,
Borrowers shall be permitted to extend the First
Extended Maturity Date for all purposes under the Loan
Documents, subject to the terms and conditions of this
Agreement, to May 31, 2002 (the "Second Extended
Maturity Date"), by either (x) paying to Lender in
good funds the sum of Thirty Million Dollars
($30,000,000.00) (the "Second Extension Amount"), (y)
securing and providing evidence of a final commitment
from HUD or other lender to the Borrowers to provide
take-out financing (the "Take-Out Financing") that
shall at least include take-out financing for the three
properties referred to as the Willows (Puyallup), La
Casa Grande and Spring Xxxxxxx (the "Three Properties")
or any combination thereof, in an amount that is
sufficient for Borrower to be able to pay Lender in
full at least the Second Extension Amount plus an
amount equal to the sum of the Allocated Loan Amounts
of the other Properties (other than the Three
Properties) included in such Take-Out Financing
(whether by the Take-Out Financing alone or through a
combination of the Take-Out Financing and other funds
from the Borrowers), provided that the Take-Out
Financing shall fund and the Second Extension Amount be
paid to Lender within 90 days of the issuance of the
commitment, and in any event on or before March 15,
2002, and provided further that such date may be
extended an additional 30 days if reasonably necessary
to effect the transfer of licenses required to operate
such Property or Properties as assisted living
facilities if such transfer is a condition to the Take-
Out Financing, or (z) entering into a sale and purchase
agreement with a third-party buyer for the sale of at
least the Three Properties or any combination thereof
(a "Sale") such that the proceeds from such Sale
together with other funds to be advanced by the
Borrowers shall be at least sufficient to pay the
Second Extension Amount plus an amount equal to the sum
of the Allocated Loan Amounts of the other Properties
(other than the Three Properties) included in the Sale,
provided that the consummation of such Sale shall occur
within 90 days of execution of the sale and purchase
agreement, and in any event on or before March 15,
2002, and provided further that such date may be
extended an additional 30 days if reasonably necessary
to effect the transfer of licenses required to operate
such Property or Properties as assisted living
facilities if such transfer is a condition to the Sale.
If the Second Extension Amount is not paid to the
Lender on or before the First Extended Maturity Date or
the Second Extension Amount is not paid by the 90-day
periods (or the additional 30-day periods if
applicable) specified in the immediately preceding
sentence in relation to the Take-Out Financing or Sale,
the Loan and any other amounts due and owing by the
Borrowers to the Lender under or in relation to the
Loan Documents will be due and payable in full on the
First Extended Maturity Date or immediately upon the
expiration of the 90-day periods (or the additional 30-
day periods if applicable) specified in the preceding
sentence, respectively.
(ii) The payment of the Second Extension Amount,
upon receipt by Lender, shall be applied as a reduction
in the outstanding principal amount of the Loan.
(iii) Notwithstanding Section 8.02 of the
Credit Agreement, if the payment of an amount equal at
least to the Second Extension Amount is paid to the
Lenders in accordance with this Section 6(b), the full
amount of the Second Extension Amount shall be used to
effect only the Partial Release of the Three
Properties.
(iv) Notwithstanding Section 8.02 of the Credit
Agreement, Borrowers shall be entitled to effect
Partial Releases for any other Property, other than the
Three Properties, at any time before an Event of
Default hereunder, at a release price equal to the
Allocated Loan Amount designated for such Property.
Accordingly, any amounts received by any Take-Out
Financing or through a Sale contemplated in Section
6(b)(i) in excess of the Second Extension Amount shall
be paid by the Borrower to Lender toward the reduction
of principal under the Loan and shall count toward
effecting the Partial Release of such other Properties
(other than the Three Properties) involved in such Take-
Out Financing or Sale pursuant to this Section
6(b)(iv).
(iv) During the period from the First Extended
Maturity Date up to and including the Second Extended
Maturity Date (the "Second Maturity Extension Period"),
the unpaid principal amount on the Loan shall continue
to accrue interest at the rate of Eurodollar Rate plus
3% (the "Second Extension Rate") until the earlier of
(x) the payment in full of the then outstanding
principal amount of the Loan and any accrued interest
or other amount then due and owing by the Borrowers to
the Lender under or in relation to the Loan Documents,
(y) the occurrence of a default or Event of Default
(defined below) hereunder, or (z) the end of the Second
Maturity Extension Period. During the Second Maturity
Extension Period, interest payments shall continue to
be due and payable under the schedule, terms and
conditions set forth in the Credit Agreement, though at
the Second Extension Rate.
(c) Third Maturity Extension Period
(i) At any time on or before the Second Extended
Maturity Date, as long as there is no default or Event
of Default hereunder, Borrowers shall be permitted to
extend the Second Extended Maturity Date, for all
purposes under the Loan Documents, subject to the terms
and conditions of this Agreement, to May 31, 2003
(the "Third Extended Maturity Date") by paying the
amount equal to one percent (1%) of the then
outstanding principal amount on the Loan (the "Third
Extension Fee"), where such Third Extension Fee, upon
receipt by Lender, shall constitute a fee earned by the
Lenders.
(ii) During the period after the Second Extended
Maturity Date up to and including the Third Extended
Maturity Date (the "Third Maturity Extension Period,"
together with the First Maturity Extension Period and
Second Maturity Extension Period, the "Maturity
Extension Periods" and each individually, a "Maturity
Extension Period"), the unpaid principal amount on the
Loan shall continue to accrue interest at the rate of
the Eurodollar Rate plus 4% (the "Third Extension
Rate") until the earlier of (x) the payment in full of
the then outstanding principal amount of the Loan and
any accrued interest or other amount then due and owing
by the Borrower to the Lender under or in relation to
the Loan Documents, (y) the occurrence of a default or
Event of Default (defined below) hereunder, or (z) the
end of the Third Maturity Extension Period. During the
Third Maturity Extension Period, interest payments
shall continue to be due and payable under the
schedule, terms and conditions set forth in the Credit
Agreement, though at the Third Extension Rate.
(iii) On the first day of each month during
the period from June 1, 2002 through and including May
1, 2003, the Borrowers shall also pay in good funds
additional principal payments in the amount of $250,000
per month (the "Second Additional Principal Payments")
that shall reduce the overall amount of the Principal
correspondingly upon Lender's receipt of each payment;
provided, however, that such Second Additional
Principal Payments shall be deemed to be allocated
toward the Allocated Loan Amount of either (x) the
Concorde Property or (y) any other Property at the
Lender's sole discretion, provided Lender provides
notice to which Property such Additional Principal
Payments shall be allocated. Accordingly, for purposes
of effecting a Partial Release pursuant to Section 8.02
of the Credit Agreement, such Second Additional
Principal Payments shall only be credited toward the
Release Price of the Concorde Property or the Release
Price of such other Property as Lender chooses in its
sole discretion. The first payment under this Section
6(c)(iii) shall be due and payable on June 1, 2002.
(d) The Borrowers shall pay to Lender in good funds
all costs and expenses incurred by Lender in obtaining (i) title
endorsements insuring that its first priority lien position in
the Properties is not affected by this Agreement or the terms
hereof and the title insurance policies remain valid and
effective or (ii) new title policies insuring that Lender has
first priority lien position in the Properties (either of the
foregoing, the "Title Insurance Fees"). Borrowers shall pay to
Lender such Title Insurance Fees within five (5) days of
receiving any invoice from Lender for such amounts.
7. Deed in Escrow. Upon thirty (30) day's prior written
notice from the Lender, as further consideration for the
agreement of the Lender to extend the Maturity Date under the
Loan Documents pursuant to Section 2 of this Agreement, Borrowers
agree to deliver to Lender's counsel deeds and certain other
documents conveying the Properties (the "Escrowed Property") and
all fixtures and personal property related thereto to the Lender
or Lender's assignee.
(a) The Borrowers shall execute and deliver to
Lender's counsel, Steptoe & Xxxxxxx LLP, in escrow, the following
documents (with the date and grantee left blank) related to the
conveyance of the Escrowed Property, which documents shall be
delivered out of escrow to the Lender, at Lender's sole
discretion upon Lender's written request to Lender's counsel and
only upon or after the occurrence of a default or an Event of
Default (as hereinafter defined), subject to any applicable cure
or remedy periods provided for in the Loan Documents, all of
which shall be satisfactory in all respects to Lender in its sole
and absolute discretion (the "Conveyance Documents"):
(i) special warranty deeds (the
"Deeds") conveying title to the Escrowed
Property;
(ii) blanket conveyances, bills of
sale and assignments conveying title
to all personal property located on or related to the
Escrowed Property;
(iii) assignments of rents and leases;
(iv) title affidavits/indemnities;
(iv) certificates of nonforeign status;
and
(v) resolutions of Borrowers
authorizing the conveyance of the Escrowed
Property pursuant to this Agreement.
(b) Concurrently with the execution and delivery of
the Conveyance Documents, Borrowers shall deliver to Lender
certified true copies of all of the following items relating to
the Escrowed Property, all of which items shall be in form and
content satisfactory to Lender (the "Property Documents"):
(i) an inventory of equipment located on the
Escrowed Property or used in connection with
the operation, use, ownership, maintenance or
repair of the Escrowed Property, specifying
whether such equipment is owned or leased by
the Borrowers or by a person claiming by or
through Borrowers;
(ii) any insurance policies relating to the
Escrowed Property;
(iii) all warranties, guaranties and
assurances given by third parties with
respect to any part of the Escrowed Property
or the equipment, including those given in
connection with the renovation of the
Escrowed Property or any portion thereof;
(iv) all certificates of occupancy, licenses and
other governmental permits issued in
connection with the Escrowed Property;
(v) all drawings, engineering reports, maps,
plans and specifications and other similar
matters with respect to the Escrowed
Property;
(vi) all surveys of the Escrowed Property;
(vii) all leases, tenancies and occupancy
agreements with respect to the Escrowed
Property;
(viii) any tax assessments, notices and
statements including the most recent tax xxxx
and paid receipts with respect to the
Escrowed Property;
(ix) a list of all claims or causes of action that
Borrowers have or may have in respect to the
Escrowed Property;
(x) a list of all suits and proceedings currently
pending and all written claims made by third-
parties with respect to the Escrowed
Property;
(xi) copies of all proffers, bonds, sureties to
which the Borrowers are bound or under which
the Borrowers have any continuing outstanding
obligations;
(xii) all books and records relating to
contracts or other agreement including,
without limitation, service, equipment,
maintenance, management and employee
contracts and agreements pertaining to the
Escrowed Property or the operation of the
Escrowed Property; and
(xiii) such other documents and items as may be
reasonably requested by Lender.
(c) All of the Conveyance Documents shall be placed in
escrow without an effective date or a transferee designated
thereon. Steptoe & Xxxxxxx LLP, or Lender's then current
counsel, is hereby authorized to fill in the grantee and an
effective date on each such Conveyance Document held in escrow,
which effective date, in each event, shall be the date on which a
default or an Event of Default (as hereinafter defined) occurs.
8. Representations and Warranties. In order to induce
Lender to enter into this Agreement, each Borrower hereby
acknowledges, represents, and warrants to Lender as follows:
(a) The Borrowers are each duly formed, validly
existing, and in good standing under the laws of the State of
Washington with powers adequate to own the Properties, to carry
on the business conducted by it, to enter into and perform this
Agreement and the other documents and instruments executed and
delivered in connection herewith, and to carry out the
transactions contemplated hereby and thereby.
(b) The execution and delivery of the Loan Documents
by the Borrowers and the performance of the obligations of the
Borrowers hereunder and thereunder have been duly authorized by
proper corporate or partnership action or such authorization
shall be obtained by each Borrower on or before June 15, 2001.
(c) The Borrowers have no defenses, affirmative
defenses, setoffs, claims, counterclaims, actions, or causes of
action of any kind or nature whatsoever against Lender, any
predecessor in interest or any of their respective past, present,
or future directors, officers, employees, agents, attorneys,
legal representatives, predecessors, affiliates, successors, or
assigns directly or indirectly, arising out of, based upon, or in
any manner connected with any transaction, event, circumstance,
action, failure to act, or occurrence of any sort or type,
whether known or unknown, which occurred, existed, was taken,
permitted, or begun prior to the execution of this Agreement and
occurred, existed, was taken, permitted, or begun in accordance
with, pursuant to, or by virtue of the Loan or any of the terms
of any of the Loan Documents, or which directly or indirectly
relate to or arise out of or in any manner are connected with the
Loan, any of the Loan Documents, or any part thereof, including
the servicing of the Loan.
(d) Insurance policies complying with the terms of the
Loan Documents are in full force and effect.
(e) All financial statements heretofore delivered by
the Borrowers to Lender are true, correct, and complete, do not
contain any untrue statement of material fact, and do not omit
any fact necessary to make the information contained therein not
misleading.
(f) There are no agreements to sell or convey any
portion of any of the Properties or any rights thereto or
interest therein to any party, including, without limitation, any
government or governmental agency.
(g) There is no litigation, at law or in equity, or
any proceeding before any federal, state, or other governmental
or administrative agency or any arbitrator pending or, to the
knowledge of Borrowers, threatened against any of the Borrowers
nor any other litigation or proceeding pending or, to the
knowledge of Borrowers, threatened affecting any Property which
has not been disclosed to Lender in writing.
(h) Borrowers are in compliance with all material
laws, ordinances, rules, and regulations of all governmental
entities (and all agencies, bodies, and subdivisions thereof)
bearing upon the ownership or operation of the Properties, and
Borrowers have not received any notice of noncompliance from any
such governmental entity with respect to any of the Properties.
(i) Neither the execution and delivery of this
Agreement nor the consummation of the transactions herein
contemplated, nor compliance with the terms and provisions
hereof, has constituted or resulted in or will constitute or
result in a breach of the corporate charter or by-laws of the any
of the borrowing entities, or the violation of any law, order,
writ, injunction, or decree of any court or governmental
department, commission, board, bureau, agency, or instrumentality
applicable to Borrowers, or will conflict or will be inconsistent
with or will result in any breach of, any of the terms,
covenants, conditions, or provisions thereof, or will constitute
a default under, any indenture, mortgage, instrument, document,
agreement, or contract of any kind to which Borrowers may be
bound or subject.
(j) Borrowers have derived direct benefits from this
Agreement and the transactions contemplated hereby.
(k) All documents, reports, certificates, and
statements furnished to Lender by or on behalf of Borrowers in
connection with the transactions contemplated hereby are true,
correct, and complete; do not contain any untrue statement of
material fact; and do not omit any fact necessary to make the
information contained therein not misleading.
(l) To the best of Borrowers' knowledge, based upon
the prepared reports and information that has come to its
attention during Borrowers' ownership of the Properties, the
premises upon which the Properties are located are free from all
environmental hazards.
(m) All property taxes and other taxes, assessments,
levies, license fees, permit fees and all other charges
heretofore levied, assessed, confirmed, or imposed upon, or in
respect of, or which might become a lien upon, any of the
Properties has been paid in full.
(n) All representations and warranties in the Loan
Documents were true and correct when given and remain true and
correct.
The continued validity in all respects of all
representations and warranties made in the Loan Documents, this
Agreement and all other documents delivered by the Borrowers in
connection with this Agreement will be a condition precedent to
Lender's obligations and agreements created by this Agreement.
9. Events of Default. The occurrence of any one or more
of the following shall constitute an "Event of Default" under
this Agreement and Lender's agreement to extend the Maturity Date
shall automatically terminate, without further act or instrument:
(a) Failure of any Borrower to comply with any term,
condition, or covenant in this Agreement or the Pre-Negotiation
Agreement, including without limitation, any failure by Borrowers
to pay the outstanding principal amount, interest and all other
amounts due and owing under or in relation to the Loan Documents
by the Borrowers upon the expiration of the Third Maturity
Extension Period, or failure to pay the outstanding principal
balance, interest and all other amounts due and owing under or in
relation to the Loan Documents by the Borrowers upon the
expiration of any of the earlier Maturity Extension Periods if
Borrowers have failed to satisfy the terms and conditions in
Section 6 for a subsequent Maturity Extension Period.
(b) Any default by any Borrower under any of the Loan
Documents.
(c) Entry of a judgment or filing of a lien against
any Borrower or any of their properties, which remains unpaid,
unstayed, unbonded, undischarged, or undismissed for a period
longer than thirty (30) days.
(d) Failure of any Borrower to execute and/or deliver
any of the documents provided for in this Agreement or any other
documents reasonably required by Lender.
(e) Failure of any Borrower to observe or perform any
covenant, agreement, term, or condition of this Agreement, as and
when provided herein.
(f) If any representation or warranty made herein, in
any Loan Document, or in any report, certificate, financial
statement or other instrument or document furnished in connection
with this Agreement or contemplated hereby, shall prove to have
been materially false or misleading on the date as of which it
was made.
(g) If any Borrower shall: (1) make a general
assignment for the benefit of creditors; (2) file a voluntary
petition or a petition or answer seeking reorganization or an
arrangement with creditors or take advantage of any bankruptcy,
reorganization, insolvency, readjustment of debt, dissolution, or
liquidation statute or law, or make or file an answer admitting
material allegations of a petition filed against it in any
proceeding under any such law; (3) fail to cause to be dismissed
any bankruptcy proceedings commenced against it within sixty (60)
days after commencement of the same; or (4) have entered against
it an order, judgment, or decree of any court of competent
jurisdiction, approving a petition seeking reorganization of
assets or appointing a receiver, trustee, or liquidator for any
assets.
(h) The levying of any execution or attachment or the
institution of any foreclosure proceeding against any assets of
any Borrower which is not set aside within thirty (30) days.
(i) An Event of Default as defined under Section 6.01
of the Credit Agreement, except as otherwise provided in this
Agreement with respect to maturity dates and payment of specified
interest and fees pursuant to this Agreement.
(j) Lender hereafter becomes aware of any fact or
circumstances that Lender believes in good faith is reasonably
likely to impair Lender's security, or any material
misrepresentation made by any Borrower in connection with this
Agreement, including the attachments hereto.
(k) Any Borrower breaches any term or condition in the
Pre-Negotiation Agreement;
provided, however, that in the case of any Event of Default
arising from any Non-Monetary Default or arising out of the
failure to pay the Title Insurance Fees or Legal Fees on a timely
basis pursuant to this Agreement, such Event of Default shall not
be deemed to occur unless Lender has provided notice thereof to
Borrower and Borrower has failed to remedy such Event of Default
within 5 days of receipt of notice from Lender (the "Cure
Period"). If Borrower has failed to remedy such Event of Default
within the Cure Period, the Event of Default shall be deemed to
have occurred on the date notice was given by Lender. For
purposes of this Section 9, a "Non-Monetary Default" shall mean
any Event of Default other than an Event of Default arising from
the failure to timely pay the outstanding principal of the Loan,
the applicable interest payments under the Loan Documents, or any
other payments required under the Loan Documents, including
without limitation, the First Extension Fee, the Second Extension
Amount and the Third Extension Fee.
10. Remedies.
(a) Upon the occurrence of any Event of Default,
immediately and without further notice, the obligation and
agreements of Lender set forth in this Agreement shall terminate,
the Loan shall be deemed accelerated and due and payable in full,
with interest to then begin accruing at the Default Rate pursuant
to Section 2.05(b) of the Credit Agreement upon the occurrence
and during the continuance of an Event of Default, and Lender
shall have the right to exercise any and all rights and remedies
available to it hereunder, under the Loan Documents, including
but not limited to the right to charge the Default Rate, or under
applicable law to the same extent as though this Agreement had
not been executed, without regard to any notice or cure period
contained therein or otherwise available.
(b) In furtherance of the provisions of subsection
10(a) above, but not in limitation thereof, upon the occurrence
of a default or an Event of Default, at the option of Lender,
the Conveyance Documents shall be delivered to Lender or Lender's
assignee and become valid and effective. If Lender elects to
have the Conveyance Documents become valid and effective,
Borrowers within five (5) days after written request, shall
execute such other documents as Lender or its assignee may
reasonably request and as may be necessary or customary in
connection with the conveyance of property and shall deliver the
Escrowed Property to Lender or its assignee in a manner specified
by Lender or its assignee in written instructions to Borrowers.
(c) Borrowers consent to the appointment of a judicial
receiver to take possession of all of the Property immediately
upon the occurrence of any default or Event of Default.
(d) All rights and remedies available to Lender under
any of the Loan Documents, and applicable law may be asserted
concurrently, cumulatively, or successively, from time to time,
as long as any indebtedness or obligations under the Loan
Documents shall remain unpaid or outstanding.
11. Credit Against Indebtedness. If the Lender elects to have
the Conveyance Documents become valid and effective, then, (a)
Borrowers shall be entitled to a credit (the "Property Credit")
against the amounts owing under the Loan Documents (to be applied
to such amounts in the sole and absolute discretion of the
Lender) in an amount equal to the value of the Property as of the
time such Conveyance Documents become valid and effective, (b)
Borrowers shall remain liable for all amounts owing under the
Loan Documents less the Property Credit (the "Agreed Deficiency")
and (c) Lender shall have the right to pursue an action and
obtain a judgment against Borrowers for the Agreed Deficiency.
In the event that Lender does not elect to have the Conveyance
Documents become valid and effective, then (a) Borrowers shall
remain liable for all amounts owing under the Loan Documents, (b)
Borrowers shall not be entitled to any credit against the amounts
owing under the Loan Documents, and (c) Lender shall have the
right to pursue any and all of its rights and remedies against
Borrowers under the Loan Documents and applicable law.
Notwithstanding the foregoing provisions of this Section 11 to
the contrary, in the event that the Lender elects to have the
Conveyance Documents become valid and effective and such
conveyance is later voided by a court of competent jurisdiction,
then Borrowers agree that any credit made by Lender pursuant to
the provisions of this Agreement shall be deemed null and void,
ab initio, and Borrowers shall be liable for all amounts owing
under the Loan Documents.
12. Discussions. All Discussions shall continue to be
subject to the terms of the Pre-Negotiation Agreement which is
hereby ratified and affirmed by all parties hereto. Without
limitation of the foregoing, no party shall be under any
obligation to reach any agreement or to pursue the Discussions,
and no obligation shall be created by reason thereof.
13. Only Written Amendments. This Agreement may be amended
only by a written amendment, fully executed and delivered by the
parties hereto.
14. Loan Documents Still in Force. Notwithstanding
anything to the contrary in this Agreement, the Loan Documents
are in full force and effect in accordance with their respective
terms, remain valid and binding obligations of Borrowers and have
not been modified or amended, and are hereby reaffirmed and
ratified by the parties hereto. The liens, security interests
and assignments created by the Loan Documents are and continue to
be valid, effective, properly perfected, enforceable and are
hereby ratified and confirmed in all respects.
15. No Waiver of Rights Under Loan Documents. Neither the
failure nor delay by Lender to exercise its remedies nor the
acceptance of partial payments or the payments described in this
Agreement or any other partial performance nor any Discussions
(whether any of the foregoing is before or after the date of this
Agreement) nor any provision of this Agreement shall amend,
modify, supplement, extend, delay, renew, terminate, waive,
release or otherwise limit or prejudice Lender's rights and
remedies or Borrowers' obligations under the Loan Documents
(including, but not limited to, Lender's right to receive full
payment of principal and interest as well as late charges,
delinquent interest, attorneys' fees and expenses, and other
charges to the extent provided in the Loan Documents) except
that, without modifying or amending the Loan Documents, Lender
agrees to extend the Maturity Date of the Loan to the extent
specifically provided in this Agreement, nor shall it affect the
priority of Lender's security interest in the Property. In
particular, Borrowers understand that nothing referred to above
shall operate to prohibit, restrict or otherwise inhibit Lender
from exercising any right or remedy it may have under the Loan
Documents (except that Lender agrees to extend the Maturity Date
of the Loan to the extent specifically provided in this
Agreement) or constitute a cure of any existing default and,
without limitation, shall not extend any applicable reinstatement
or redemption period.
16. No Defenses. Borrowers hereby acknowledge that
Borrowers have no defenses of any nature whatsoever to any
defaults or the enforcement of the Loan Documents and Borrowers
have no claims, counterclaims or offsets against Lender in
respect of the Loan, or which could be asserted against Lender by
reason of any act, conduct or omission of Lender, nor shall this
Agreement or the Maturity Date extensions contemplated by this
Agreement give rise to any such defenses, claims, counterclaims
or offsets.
17. Release of Claims by Borrowers.
(a) Release of Lender. Each Borrower, for themselves
and their successors, and assigns, hereby knowingly and
voluntarily RELEASES, DISCHARGES, and FOREVER WAIVES and
RELINQUISHES any and all claims, demands, obligations,
liabilities, defenses, affirmative defenses, setoffs,
counterclaims, actions, and causes of action of whatsoever kind
or nature, whether known or unknown, which it has, may have, or
might have or may assert now or in the future against the Lender,
its parents or subsidiaries, predecessors in interest, or any of
their past, present, or future directors, officers, employees,
agents, attorneys, legal representatives, predecessors,
affiliates, successors, or assigns, directly or indirectly,
arising out of, based upon, or in any manner connected with any
transaction, event, circumstance, action, failure to act, or
occurrence of any sort or type, whether known or unknown, which
occurred, existed, was taken, permitted, or begun prior to the
execution of this Agreement and occurred, existed, was taken,
permitted, or begun in accordance with, pursuant to, or by virtue
of the Loan, the administration of the Loan or any of the terms
of any of the Loan Documents, or which was related or connected
in any manner, directly or indirectly, to the Property, the Loan
or the Loan Documents, or any part thereof. Each Borrower hereby
acknowledges and agrees that the execution of this Agreement by
Lender shall not constitute an acknowledgment of or admission by
Lender of the existence of any such claims or of liability for
any matter or precedent upon which any liability may be asserted.
Each Borrower hereby further acknowledges and agrees that, to the
extent that any such claims may exist, they are of a speculative
nature so as to be incapable of objective valuation and that, in
any event, the value to such Borrower of the covenants and
obligations of Lender contained in this Agreement and the other
documents and instruments executed and delivered in connection
herewith substantially and materially exceeds any and all value
of any kind or nature whatsoever of any such claims.
(b) No Assignment. Each Borrower warrants and
represents to Lender that such Borrower has not sold, assigned,
transferred, conveyed or otherwise disposed of any claims which
are the subject of this Section.
(c) Discovery of Unknown or Different Facts. Each
Borrower acknowledges and agrees that the facts with respect to
which the release of claims contained in this Section is executed
may hereafter be found to be different from the facts now
believed by such Borrower to be true, and such Borrower expressly
accepts and assumes the risks of such possible differences and
agrees that the release of claims contained in this Section shall
be and remain effective notwithstanding such differences in
facts.
18. Bankruptcy.
(a) Statement of Intent. Each Borrower warrants and
represents to the Lender that such Borrower has no present intent
(i) to file any voluntary petition in bankruptcy under any
Chapter of the Bankruptcy Code or directly or indirectly to cause
the Borrower, or any other person or entity that may hereafter
own any interest in, or claim any beneficial interest in, the
property, to file any voluntary petition in bankruptcy under any
Chapter of the Bankruptcy Code or to have any involuntary
petition in bankruptcy filed against it under any Chapter of the
Bankruptcy Code or (ii) in any manner directly or indirectly to
cause such Borrower, or any other person or entity that may
hereafter own any interest in, or claim any beneficial interest
in, the Property, to seek relief, protection, reorganization,
liquidation, dissolution, or similar relief for debtors under any
federal, state, or local law, or in equity, or (iii) in any
manner directly or indirectly to cause the Property to be the
subject of any bankruptcy or insolvency proceedings or the
property of any bankruptcy or insolvency estate.
(b) Cash Collateral; Relief From Stay. Each Borrower
further acknowledges and agrees that in the event the Properties
or any portion thereof shall ever become the subject of any
bankruptcy or insolvency estate, then Lender shall immediately
become entitled, among other relief to which Lender may be
entitled under the Loan Documents, and at law or in equity, to
obtain upon ex parte application therefor and without further
notice or action of any kind, (i) an order from the court
prohibiting the use by the trustee in bankruptcy or by the
Borrower as debtor in possession of Lender's "cash collateral"
(as such term is defined in Section 363 of the Bankruptcy Code)
in connection with the Loan, and (ii) an order from the Court
granting immediate relief from the automatic stay pursuant to
Section 362 of the Bankruptcy Code so as to permit the Lender to
exercise all of its rights and remedies pursuant to the Loan
Documents, and at law and in equity, and each Borrower further
acknowledges and agrees that the occurrence or existence of any
Event of Default under this Agreement shall, in and of itself,
constitute "cause" for relief from the automatic stay pursuant to
the provisions of Section 362(d)(1) of the Bankruptcy Code.
(c) Waiver of Automatic or Supplemental Stay. Each
Borrower acknowledges and agrees that in the event of the filing
of any voluntary or involuntary petition in bankruptcy by or
against such Borrower, Borrower shall not assert or request any
other party to assert that the automatic stay provided by
Section 362 of the Bankruptcy Code shall operate or be
interpreted to stay, interdict, condition, reduce, or inhibit the
ability of Lender to enforce any rights it has by virtue of this
Agreement or the other Loan Documents, or any other rights Lender
has, whether now or hereafter acquired, against any person or
entity which is not a debtor in such bankruptcy proceedings or
against any property owned by any such non-debtor; and further
that, in the event of the filing of any voluntary or involuntary
petition in bankruptcy by or against such Borrower, Borrower
shall not seek a supplemental stay or any other relief, whether
injunctive or otherwise, pursuant to Section 105 of the
Bankruptcy Code or any other provision of the Bankruptcy Code, to
stay, interdict, condition, reduce, or inhibit the ability of
Lender to enforce any rights it has by virtue of this Agreement
or the other Loan Documents, or at law or in equity, or any other
rights Lender has, whether now or hereafter acquired, against any
person or entity which is not a debtor in such bankruptcy
proceedings, or against any property owned by any such non-
debtor.
(d) Further Agreement. As additional consideration
for Lender's execution of this Agreement, each Borrower agrees as
follows: (i) in the event of a bankruptcy filing by or against
such Borrower, it shall not reject this Agreement, nor contest
any claim or assertion by Lender that this Agreement is binding
on the parties hereto, and that valuable consideration has been
received by such Borrower for this Agreement; (ii) Lender shall,
at its option, receive immediate relief from the automatic stay
provisions of the Bankruptcy Code following any bankruptcy
petition which such Borrower may file or which may be filed
against such Borrower, and in no event shall Borrower contest a
motion to lift the automatic stay filed by Lender; and (iii) any
contrary action taken by such Borrower with respect to the
matters set forth above shall be deemed to be in bad faith and
are agreed to constitute violations of Federal Rules of Civil
Procedure 11 and Bankruptcy Rule 9011.
(e) Representations. Each Borrower represents and
warrants to Lender and agrees as follows: (i) Borrower has
assured Lender that if the consensual out of court plan of
reorganization contained in this Agreement cannot be carried out
by Borrower in accordance with the terms of this Agreement, that
Borrower intends to allow Lender to foreclose and exercise all of
its other rights and remedies as a secured creditor; (ii)
Borrower does not intend to file a bankruptcy petition and has no
intention of seeking a non-consensual plan of reorganization in
any bankruptcy forum; (iii) if Borrower is unable to reorganize
its business and financial affairs prior to the occurrence of any
Event of Default so that it is able to satisfy its obligations to
Lender under this Agreement and the other Loan Documents, any
further attempt or additional time to reorganize its financial
affairs and to pay and perform its obligations to Lender would be
fruitless and impracticable to achieve; (iv) any filing by
Borrower of a voluntary petition in bankruptcy or the exercise of
like or similar rights by Borrower prior to satisfaction of
Borrower's indebtedness to Lender would be inconsistent with and
contrary to the intentions of parties and made only with the
intention of hindering, delaying or defrauding Lender in the
enforcement of its rights as a secured creditor; (v) Borrower
cannot formulate or implement a successful plan of reorganization
in any such proceeding (whether in bankruptcy or under a like
proceeding) which would adequately and sufficiently protect the
rights of Lender or enable Borrower to satisfy its obligations to
Lender; (vi) in light of the foregoing, any such filing would be
made in bad faith as such term is used by courts in construing
the Bankruptcy Code, as amended, as to Lender and only with the
intention to hinder, delay or defraud Lender from exercising its
rights and remedies as to the obligations of Borrower to Lender
and the collateral securing such obligations; (vii) in light of
the foregoing, if any voluntary or involuntary proceeding in
bankruptcy or under like laws granting relief to Borrower is
filed by or against Borrower, Lender shall have the right to seek
and obtain immediate relief from any stay as to the Property and
the other collateral for the obligations secured thereby and to
have the exclusivity period for the filing of any plan of
reorganization terminated, and Borrower shall be estopped from
objecting to or opposing in any manner the relief requested by
Lender or the termination of any such exclusivity period in a
bankruptcy proceeding; and (viii) Borrower will not solicit,
assist or encourage any third party to file an involuntary
bankruptcy petition against Borrower. Lender is relying on,
among other things, the representations and warranties contained
in this Section in entering into this Agreement.
(f) Proof of Claim. Notwithstanding anything to the
contrary herein contained, in the event of a filing under any
chapter of the Bankruptcy Code by or against the Borrowers,
Lender shall be entitled to file a proof of claim in such
bankruptcy case(s) in the full amount equal to the then-
outstanding indebtedness evidenced by the Loan Documents.
19. Lender's Costs and Expenses. Nothing herein shall (a)
diminish or otherwise limit any obligation Borrowers may have
under the Loan Documents with respect to payment of Lender's
costs and expenses, or (b) prevent Lender from requiring
Borrowers to pay all such costs and expenses.
20. REVIEW BY EACH BORROWER WITH INDEPENDENT COUNSEL. EACH
BORROWER ACKNOWLEDGES AND AGREES THAT (A) BORROWER HAS CAREFULLY
READ AND UNDERSTANDS ALL OF THE TERMS OF THIS AGREEMENT;
(B) BORROWER HAS EXECUTED THIS AGREEMENT FREELY AND VOLUNTARILY,
AFTER HAVING CONSULTED WITH BORROWER'S INDEPENDENT LEGAL COUNSEL
AND AFTER HAVING HAD ALL OF THE TERMS OF THIS AGREEMENT EXPLAINED
TO IT BY ITS INDEPENDENT LEGAL COUNSEL; (C) THE WAIVERS AND
RELEASES CONTAINED IN THIS AGREEMENT ARE REASONABLE, NOT CONTRARY
TO PUBLIC POLICY OR LAW, AND HAVE BEEN INTENTIONALLY,
INTELLIGENTLY, KNOWINGLY, AND VOLUNTARILY AGREED TO BY BORROWER;
(D) THE WAIVERS AND RELEASES CONTAINED IN THIS AGREEMENT HAVE
BEEN AGREED TO BY BORROWER WITH FULL KNOWLEDGE OF THEIR
SIGNIFICANCE AND CONSEQUENCES, INCLUDING FULL KNOWLEDGE OF THE
SPECIFIC NATURE OF ANY RIGHTS OR DEFENSES WHICH BORROWER HAS
AGREED TO WAIVE OR RELEASE PURSUANT TO THIS AGREEMENT;
(E) BORROWER HAS HAD A FULL AND ADEQUATE OPPORTUNITY TO NEGOTIATE
THE TERMS CONTAINED IN THIS AGREEMENT; (F) BORROWER IS
EXPERIENCED IN AND FAMILIAR WITH LOAN TRANSACTIONS OF THE TYPE
EVIDENCED BY THIS AGREEMENT; AND (G) THE WAIVERS AND RELEASES
CONTAINED IN THIS AGREEMENT ARE MATERIAL INDUCEMENTS TO THE
LENDER'S EXECUTION OF THIS AGREEMENT, AND THE LENDER HAS RELIED
ON SUCH WAIVERS AND RELEASES IN ENTERING INTO THIS AGREEMENT AND
WILL CONTINUE TO RELY ON SUCH WAIVERS AND RELEASES IN ANY RELATED
FUTURE DEALINGS WITH BORROWER.
21. Survival; Successors and Assigns. All covenants,
agreements, representations, and warranties made in this
Agreement and in the Loan Documents shall survive the execution
of this Agreement and shall continue in full force and effect.
Whenever in this Agreement any of the parties hereto is referred
to, such reference shall be deemed to include the successors and
assigns of such party, but this shall not be deemed to permit
assignment by the Borrowers of any or all of its interests in the
Property or any part thereof. All covenants, agreements,
representations, and warranties by or on behalf of the Borrowers
that are contained in this Agreement or any of the Loan Documents
shall inure to the benefit of Lender and its successors and
assigns and shall bind Borrowers and their respective heirs,
personal representatives, successors, and assigns. Borrowers may
not assign this Agreement or any of their rights hereunder.
22. Notices. Any notice, demand or other communication
which any party may desire or may be required to give to any
other party shall be in writing, and shall be deemed given if and
when personally delivered (personal delivery shall include
delivery by messenger or expedited delivery service regularly
providing proof of delivery, such as Federal Express or
Airborne), if by facsimile, upon receipt by the sender of a
confirmatory receipt of transmission provided a copy of such
notice is promptly sent via any of the other methods set forth in
this Section 22, or when delivered (whether accepted or refused)
by United States registered or certified mail, postage prepaid
and return receipt requested addressed to a party at its address
set forth below, or to such other address as the party to receive
such notice may have designated to all other parties by notice in
accordance herewith:
(a) If to Lender:
Deutsche Bank AG
c/o Deutsche Bank Alex. Xxxxx, Inc.
00 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: CMBS Workout Department
Phone:
Fax:
with a copy to (which shall not be notice hereunder):
Steptoe & Xxxxxxx LLP
0000 Xxxxxxxxxxx Xxxxxx, X.X.
Xxxxxxxxxx, X.X. 00000-0000
Attention: Xxxx Xxxxx, Esq.
Phone: 000-000-0000
Fax: 000-000-0000
(b) If to Borrowers:
Emeritus Properties II, Inc.
Emeritus Properties III, Inc.
Emeritus Properties V, Inc.
Emeritus Properties VII, Inc.
c/o Emeritus Corporation
0000 Xxxxxxx Xxxxxx
Xxxxx 000
Xxxxxxx, Xxxxxxxxxx 00000
Phone:
Fax:
23. Miscellaneous. In the event of any dispute under this
Agreement, the prevailing party or parties shall be entitled to
recover all costs and attorneys' fees from the non-prevailing
party or parties. Section headings used herein are for
convenience only and shall not be used to interpret any term
hereof. Masculine, feminine, or neuter gender and the singular
and the plural number, shall each be considered to include the
other whenever the context so requires. If any party consists of
more than one person, each such person shall be jointly and
severally liable.
24. Access. Lender shall have the right, upon two (2) days
notice, and at any time during normal business hours, to inspect
the Property, or to inspect, audit, and transcribe the books,
records, contracts, and insurance policies maintained by the
Borrowers in connection with the Property or the Borrowers'
business.
25. WAIVER OF JURY TRIAL. EACH PARTY TO THIS AGREEMENT
AGREES THAT ANY SUIT, ACTION, OR PROCEEDING BROUGHT OR INSTITUTED
BY ANY PARTY HERETO OR ANY SUCCESSOR OR ASSIGN OF ANY PARTY ON OR
WITH RESPECT TO THIS AGREEMENT, ANY OF THE DOCUMENTS EXECUTED IN
CONNECTION WITH THIS AGREEMENT, ANY OF THE LOAN DOCUMENTS OR
WHICH IN ANY WAY RELATES, DIRECTLY OR INDIRECTLY, TO THE
OBLIGATIONS UNDER THIS AGREEMENT OR ANY EVENT, TRANSACTION OR
OCCURRENCE ARISING OUT OF OR IN ANY WAY CONNECTED THEREWITH, OR
THE DEALINGS OF THE PARTIES WITH RESPECT THERETO, SHALL BE TRIED
ONLY BY A COURT AND NOT A JURY. EACH PARTY HEREBY EXPRESSLY
WAIVES ANY RIGHT TO A TRIAL BY JURY IN ANY SUCH SUIT, ACTION, OR
PROCEEDING. BORROWERS ACKNOWLEDGE AND AGREE THAT THIS PROVISION
IS A SPECIFIC AND MATERIAL ASPECT OF THIS AGREEMENT BETWEEN THE
PARTIES AND THAT THE LENDER WOULD NOT AGREE TO THE RESTRUCTURE OF
OBLIGATIONS OR EXTENSION OF THE TIME OF PAYMENT IF THIS WAIVER OF
JURY TRIAL PROVISION WERE NOT A PART OF THIS AGREEMENT.
26. Authority. By execution hereof, each of the natural
persons signing on behalf of the Borrowers hereby represent and
warrant that each is fully authorized to act on behalf of
Borrowers with respect to the Loan and to execute this Agreement
on behalf of the Borrowers.
27. Agent's Fees. The parties hereto represent and
warrant, each to the other, that no broker or agent is entitled
to receive a fee or has been engaged in any manner relating to
the transactions contemplated herein, and that the transactions
hereby contemplated are made without liability for any agent's or
other similar fees. The parties hereto mutually agree to
indemnify and hold each other harmless (including reasonable
attorneys' fees) from claims of brokers or agents asserted by any
of the other parties or any person or entity claiming through
such other party as a result of dealings claimed to give rise to
such liability.
28. Entire Agreement. This Agreement and exhibits hereto,
and other documents executed in connection herewith, constitute
the entire agreement concerning this subject matter and
supersedes any prior or contemporaneous representations or
agreements not contained herein concerning the subject matter of
this Agreement and there are no agreements, understandings,
warranties or representations among the parties hereto except as
set forth herein and in the other Loan Documents.
29. Binding Effect. This Agreement will inure to the
benefit of and bind the respective heirs, personal
representatives, successors and permitted assigns of the parties
hereto.
30. Relationship of Parties. Nothing contained in this
Agreement or the other Loan Documents constitutes or shall be
construed as the formation of a partnership, joint venture,
tenancy-in-common, or any other form of co-ownership between the
Lender and Borrowers or any other person or the creation of any
confidential or fiduciary relationship of any kind between the
Lender and Borrowers or any other person. The Lender shall not
be deemed to be a partner, joint venturer, co-tenant, trustee, or
fiduciary with respect to Borrowers or any other person as a
result of this Agreement, any of the other Loan Documents, or any
of the transactions contemplated by this Agreement or any of the
other Loan Documents. Borrowers acknowledge and agree that the
Lender has at all times acted and shall at all times continue to
be acting only as a lender to Borrowers within the normal and
usual scope of activities of a lender.
31. Severability. If any clause or provision of this
Agreement is determined to be illegal, invalid or unenforceable
under any present or future law by the final judgment of a court
of competent jurisdiction, the remainder of this Agreement will
not be affected thereby. It is the intention of the parties
hereto that if any such provision is held to be illegal, invalid
or unenforceable, there will be added in lieu thereof a provision
as similar in terms to such provision as is possible and be
legal, valid and enforceable.
32. Headings. Paragraph or other headings contained in
this Agreement are for reference purposes only and are not
intended to affect in any way the meaning or interpretation of
this Agreement.
33. Affiliates and Subsidiaries. Whenever used in this
Agreement, the terms "affiliates" and "subsidiaries" mean and
include any corporation, partnership, limited partnership, or
joint venture in which at least 50% of the equity is owned
directly or indirectly by the relevant party.
34. Counterpart Execution. This Agreement may be executed
in counterparts, each of which will be deemed an original
document, but all of which will constitute a single document.
This document will not be binding on or constitute evidence of a
contract between the parties hereto until such time as a
counterpart of this document has been executed by each party and
a copy thereof delivered to each other party to this Agreement.
35. Governing Law. This Agreement shall be governed by,
interpreted and construed in accordance with the laws of the
State of New York including all matters of construction, validity
and performance without regard to the conflicts-of-laws
provisions thereof except New York General Obligations Law
Section 5-1401 and Section 5-1402, regardless of the domicile of
any party, and will be deemed for such purposes to have been
made, executed and performed in the State of New York. All
claims, disputes and other matters in question arising out of or
relating to this Agreement, or the breach thereof, will be
decided by proceedings instituted and litigated in a court of
competent jurisdiction sitting in the State of New York, and the
parties hereto hereby consent to the jurisdiction of those
courts.
36. Consent to Jurisdiction; Service of Process.
(a) Each of the parties hereto hereby irrevocably and
unconditionally submits, for itself and its property, to the
nonexclusive jurisdiction of any New York state court or federal
court of the United State of America sitting in New York City,
and any appellate court from any thereof, in any action or
proceeding arising out of or relating to this Agreement, the
other documents executed in connection with this Agreement or the
subject matter hereof or thereof or any of the transactions
contemplated hereby or thereby, or for recognition or enforcement
of any judgment, and each of the parties hereto hereby
irrevocably and unconditionally agrees that all claims in respect
of any such action or proceeding may be heard and determined in
any such New York state court, or to the extent permitted by law,
in such federal court. Each of the parties thereto agrees that a
final judgment in any such action or proceeding shall be
conclusive and may be enforced in other jurisdictions by suit on
the judgment or in any other manner provided by law. Nothing in
this Agreement shall affect any right any party may otherwise
have to bring any action or proceeding relating to this
Agreement.
(b) Each of the parties hereto irrevocably and
unconditionally waives and agrees to not assert, by way of
motion, as a defense or otherwise, to the fullest extent it may
legally and effectively do so, any objection that it may now or
hereafter have to the laying of venue of any suit, action or
proceeding arising out of or relating to this Agreement to which
it is a party in any New York state or federal court or that it
is not personally subject to jurisdiction of the above-named
courts. Each of the parties hereto hereby irrevocably waives, to
the fullest extent permitted by law, the defense of an
inconvenient forum to the maintenance of such action or
proceeding in any such court.
(c) Each of the parties hereto hereby consents to
service of process by registered mail or overnight courier
service at the address to which notices to it are to be given, it
being agreed that service in such manner shall constitute valid
service upon such party or its respective successors or assigns
in connection with any such action or proceeding; provided,
however, that nothing in this Section 36 shall affect the right
of any such parties or their respective successors and assigns to
serve legal process in any other manner permitted by applicable
law.
37. Further Assurances. Prior to and at all times
following the execution of this Agreement, the Borrowers agree to
execute and deliver, or to cause to be executed and delivered,
such documents and to do, or cause to be done, such other acts
and things as might reasonably be requested by Lender to assure
that the benefits of this Agreement are realized.
38. Recitals Incorporated by Reference. The "Recitals" set
forth at the beginning of this Agreement are hereby acknowledged
to be true and correct by the parties hereto and are incorporated
into this Agreement.
39. Amendment. Neither this Agreement nor any of the
provisions hereof can be changed, waived, discharged or
terminated, except by an instrument in writing signed by the
party against whom enforcement of the change, waiver, discharge
or termination is sought.
40. Time of the Essence. Time is of the essence of each
provision of this Agreement.
[REST OF PAGE INTENTIONALLY BLANK]
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed and delivered under seal as of the
date first above written.
BORROWERS:
EMERITUS PROPERTIES II, INC.
By /s/Xxxxxxx X. Xxxxxxxxxx
Name: Xxxxxxx X. Xxxxxxxxxx
Title: Vice President of Finance
EMERITUS PROPERTIES III, INC.
By /s/Xxxxxxx X. Xxxxxxxxxx
Name: Xxxxxxx X. Xxxxxxxxxx
Title: Vice President of Finance
EMERITUS PROPERTIES V, INC.
By /s/Xxxxxxx X. Xxxxxxxxxx
Name: Xxxxxxx X. Xxxxxxxxxx
Title: Vice President of Finance
EMERITUS PROPERTIES VII, INC.
By /s/Xxxxxxx X. Xxxxxxxxxx
Name: Xxxxxxx X. Xxxxxxxxxx
Title: Vice President of Finance
LENDER:
DEUTSCHE BANK AG
By /s/Xxxxx X. Xxxxxxx
Name: Xxxxx X. Xxxxxxx
Title: Attorney-in-Fact - DBAG
By /s/Xxxxxx X. Xxxxx
Name: Xxxxxx X. Xxxxx
Title: Director
ACKNOWLEDGED AND AGREED
GUARANTOR AND INDEMNITOR
EMERITUS CORPORATION
By /s/Xxxxxxx X. Xxxxxxxxxx
Name: Xxxxxxx X. Xxxxxxxxxx
Title: Vice President of Finance
