THIS NOTE IS SUBJECT TO A SUBORDINATION AND
STANDSTILL AGREEMENT DATED AS OF MAY 1, 1997,
AMONG
EMERITUS PROPERTIES V, INC., HIGH YIELD
PARTNERS,
LLC, AND FLEET NATIONAL BANK. BY ITS
ACCEPTANCE
OF THIS NOTE, THE HOLDER HEREOF AGREES TO BE
BOUND BY
THE PROVISIONS OF SUCH SUBORDINATION AND
STANDSTILL
AGREEMENT TO THE SAME EXTENT THAT THE
SUBORDINATED
LENDER (AS DEFINED THEREIN) IS BOUND
PROMISSORY NOTE
$7,000,000.00 May
1, 1997
FOR VALUE RECEIVED, the undersigned
EMERITUS PROPERTIES V, INC., a Washington
corporation (the "Borrower"), hereby promises
to pay to HIGH YIELD PARTNERS LLC, a Delaware
limited liability company (the "Lender"), or
registered assigns, at the Lender's office
c/o Hanseatic Corporation, 000 Xxxx Xxxxxx -
Xxxxx 0000, Xxx Xxxx, Xxx Xxxx 00000:
(a) prior to or on the third anniversary of
the date hereof, the principal amount of
Seven Million Dollars ($7,000,000.00),
evidencing the Loan (as defined in the Credit
Agreement dated as of May 1, 1997 [as amended
and in effect from time to time, the "Credit
Agreement"] by and between the Borrower and
the Lender) made by the Lender to the
Borrower;
(b) the principal outstanding hereunder from
time to time at the times provided in the
Credit Agreement; and
(c) interest from the date hereof on the
principal amount from time to time
outstanding to and including the maturity
hereof at the rates and terms and in all
cases in accordance with the terms of the
Credit Agreement.
This Note evidences borrowings under and has
been issued by the Borrower in accordance
with the terms of the Credit Agreement. The
Lender and any holder hereof is entitled to
the benefits of the Credit Agreement, the
Security Documents and the other Loan
Documents, and may enforce the agreements of
the Borrower contained therein, and any
holder hereof may exercise the respective
remedies provided for thereby or otherwise
available in respect thereof, all in
accordance with the respective terms thereof.
All capitalized terms used in this Note and
not otherwise defined herein shall have the
same meanings herein as in the Credit
Agreement.
The Borrower irrevocably authorizes the
Lender to make or cause to be made, at the
time of receipt of any payment of principal
of this Note, an appropriate notation on the
grid attached to this Note, or the
continuation of such grid, or any other
similar record, including computer records,
reflecting the receipt of such payment. The
outstanding amount of the Loan set forth on
the grid attached to this Note, or the
continuation of such grid, or any other
similar record, including computer records,
maintained by the Lender with respect to the
Loan shall be prima facie evidence of the
principal amount of the Loan owing and unpaid
to the Lender, but the failure to record, or
any error in so recording, any such amount on
any such grid, continuation or other record
shall not limit or otherwise affect the
obligation of the Borrower hereunder or under
the Credit Agreement to make
payments of principal of and interest on this
Note when due.
The Borrower has the right in certain
circumstances and the obligation under
certain other circumstances to prepay the
whole or part of the principal of this Note
on the terms and conditions specified in the
Credit Agreement.
If any one or more of the Events of Default
shall occur, the entire unpaid principal
amount of this Note, all of the unpaid
interest accrued thereon and all other
amounts payable under the Loan Documents
shall automatically become forthwith due and
payable in the manner and with the effect
provided in the Credit Agreement.
No delay or omission on the part of the
Lender or any holder hereof in exercising any
right hereunder shall operate as a waiver of
such right or of any other rights of the
Lender or such holder, nor shall any delay,
omission or waiver on any one occasion be
deemed a bar or waiver of the same or any
other right on any future occasion.
In the event that one or more of the
provisions of this Note shall for any reason
be held to be invalid, illegal or
unenforceable in any respect, such
invalidity, illegality or unenforceability
shall not affect any other provisions of this
Note, but this Note shall be construed as if
such invalid, illegal or unenforceable pro
vision had never been contained herein.
This Note is a registered Note and, as
provided in the Credit Agreement, upon
surrender of this Note for registration of
transfer, duly endorsed, or accompanied by a
written instrument of transfer duly executed
by the registered holder hereof or such
holder's attorney duly authorized in writing,
a new Note for a like principal amount will
be issued to, and registered in the name of,
the transferee. Prior to due presentment for
registration of transfer, the Borrower may
deem and treat the person in whose name this
Note is registered as the absolute owner of
this Note for the purpose of receiving
payment hereon or on account hereof and for
all other purposes, and the Borrower shall
not be affected by any notice to the
contrary.
The Borrower and every endorser and guarantor
of this Note or the obligation represented
hereby waives presentment, demand, notice,
protest and all other demands and notices in
connection with the delivery, acceptance,
performance, default or enforcement of this
Note, in each case subject to the specific
provisions of the Credit Agreement, and
assents to any extension or postponement of
the time of payment or any other indulgence,
to any substitution, exchange or release of
collateral and to the addition or release of
any other party or person primarily or
secondarily liable.
THIS NOTE AND THE OBLIGATIONS OF THE BORROWER
HEREUNDER SHALL FOR ALL PURPOSES BE GOVERNED
BY AND CONSTRUED IN ACCORDANCE WITH THE LAW
OF THE STATE OF NEW YORK (EXCLUDING THE LAWS
APPLICABLE TO CONFLICTS OR CHOICE OF LAW).
THE BORROWER AGREES THAT ANY SUIT FOR THE
ENFORCEMENT OF THIS NOTE MAY BE BROUGHT IN
THE COURTS OF THE STATE OF NEW YORK OR ANY
FEDERAL COURT SITTING THEREIN AND THE CONSENT
TO THE NONEXCLUSIVE JURISDICTION OF SUCH
COURT AND THE SERVICE OF PROCESS IN ANY SUCH
SUIT BEING MADE UPON THE BORROWER BY MAIL AT
THE ADDRESS
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SPECIFIED IN SECTION 10.3 OF THE CREDIT
AGREEMENT. THE BORROWER HEREBY WAIVES ANY
OBJECTION THAT IT MAY NOW OR HEREAFTER HAVE
TO THE VENUE OF ANY SUCH SUIT OR ANY SUCH
COURT OR THAT SUCH SUIT IS BROUGHT IN AN
INCONVENIENT COURT.
IN WITNESS WHEREOF, the undersigned has
caused this Note to be signed in its name by
its duly authorized representatives as of the
day and year first above written.
EMERITUS PROPERTIES V,
INC.
By: /s/ Xxxxxxx X.
Xxxxxxxxxx
------------------------------------------
Name: Xxxxxxx X.
Xxxxxxxxxx
Title: President
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