Exhibit 99.04
FORBEARANCE AGREEMENT
This AGREEMENT (this "AGREEMENT") is executed effective as of the 1st day of
November, 2002, by and among XXXXXXX X. XXXXX and XXXXXXX X.X. XXXXX
(hereinafter collectively referred to as "BORROWER"), and ZIONS FIRST NATIONAL
BANK ("LENDER").
WITNESSETH:
WHEREAS, Medical Capital Management, Inc. ("MCM") heretofore made a
$300,000.00 loan (the "LOAN") to Borrower, which Loan is evidenced by that
certain Deed of Trust Note (the "NOTE") dated July 15, 2001, in the original
principal amount of $300,000.00, executed by Borrower and payable to the order
of MCM; and
WHEREAS, the Note is secured by, among other things, the lien and
provisions of that certain Deed of Trust, Assignment of Leases and Rents and
Security Agreement (the "DEED OF TRUST") executed by Borrower, as Trustor to
Xxxxxxx Services Corporation, Trustee for the benefit of MCM, dated as of July
15, 2001; and
WHEREAS, the payment and performance of all of Borrower's obligations under
the Note, the Deed of Trust and the other documents executed by Borrower in
connection therewith (the Note, the Deed of Trust and such other documents are
hereinafter collectively referred to as the "LOAN DOCUMENTS"); and
WHEREAS, MCM subsequently assigned all of its right, title and interest in,
to and under the Loan Documents to Lender pursuant to that certain Assignment of
Note and Lien dated October 25, 2001; and
WHEREAS, Borrower hereby acknowledges and agree that the Loan Documents are
in default and, as a result, the Trust Property (as defined in the Deed of Trust
and herein so called); and
WHEREAS, Borrower has requested that Lender forebear from conducting a
Foreclosure Sale and from exercising any of its rights and remedies under the
Loan Documents as a consequence of the existing default described above and,
subject to the terms hereof, Lender agrees to the foregoing.
NOW, THEREFORE, for and in consideration of the premises and the mutual
covenants, representations, warranties and agreements contained herein, and
other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the parties hereto hereby agree as follows:
1. PAYMENT OF FORBEARANCE FEE. As a condition precedent to the
effectiveness of this Agreement, Borrower shall pay to Lender as a forbearance
fee the sum of $5,000.00 in cash in good and sufficient United States funds
immediately available in Anaheim, California, with such payment to be made
simultaneously with the execution of this Agreement.
2. PAYMENT OF LEGAL FEES. Concurrently with the execution hereof, Borrower
shall pay to Lender, the sum of $2,500.00, representing the fees and expenses
incurred to date as counsel to Lender with respect to the preparation,
negotiation and execution of this Agreement and all related documents and the
transactions contemplated hereby and thereby. In the event additional legal fees
are incurred by Lender subsequent to the date hereof with respect to the
preparation, negotiation and execution of this Agreement and all related
documents and the transactions contemplated hereby and thereby, Borrower shall
pay any and all such amounts to Lender (or directly to its counsel) promptly
upon demand therefor.
3. PAYMENT OF INTEREST. Simultaneously with the execution of this
Agreement, Borrower shall pay to Lender in cash in good and sufficient United
States funds immediately available in Anaheim, California, any and all amounts
necessary to bring all interest payments current.
4. COST AND EXPENSE OF TITLE INSURANCE COMPANY. Borrower shall bear the
entire cost of obtaining a policy of title insurance with respect to the Deed of
Trust, acceptable in form and content to Lender.
5. FORBEARANCE BY LENDER. Subject to Borrower's compliance with all the
terms and provisions of this Agreement, Lender hereby agrees to forebear from
conducting a Foreclosure Sale and from pursuing any of its rights and remedies
under the Loan Documents until July 14, 2003, after which time Lender may pursue
any and all rights and remedies available to it.
6. BORROWER'S CONSENTS. Borrower hereby confirms and agrees that each of
the Loan Documents remain in full force and effect, and the lien of the Deed of
Trust is and remains a third priority perfected lien and security interest,
securing payment of the obligations described therein. Each of the Loan
Documents is and remains the legal, valid and binding obligation of Borrower,
enforceable in accordance with its terms.
7. WAIVER. As additional consideration to the execution, delivery, and
performance of this Agreement by Borrower and to induce Lender to enter into
this Agreement, Borrower warrants and represents to Lender that no facts,
events, statuses or conditions exist or have existed which, either now or with
the passage of time or giving of notice, or both, constitute or will constitute
a basis for any claim or cause of action against Lender or any defense to (a)
the payment of any obligations and indebtedness under the Loan Documents, or (b)
the performance of any of its respective obligations in respect to the Loan
Documents, and in the event any such facts, events, statuses or conditions exist
or have existed, whether known or unknown, Borrower unconditionally and
irrevocably waives and releases any and all claims and causes of action against
tender and any defenses to its payment and performance obligations in respect to
the Loan Documents, respectively. Notwithstanding any provision of this
Agreement or any of the Loan Documents, this paragraph shall remain in full
force and effect and shall survive the delivery of this Agreement.
8. REPRESENTATIONS AND WARRANTIES. In order to induce Lender to enter into
this Agreement, Borrower hereby represents and warrants to Lender that (a)
Borrower has no defenses to payment, counterclaim or rights of set-off with
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respect to their respective obligations existing on the date hereof, and (b)
except for the existing payment default, no default has occurred which is
continuing under any of the Loan Documents.
9. RELEASE AND COVENANT NOT TO XXX. BORROWER (COLLECTIVELY, THE "RELEASING
PARTIES") JOINTLY AND SEVERALLY RELEASES, ACQUITS, AND FOREVER DISCHARGES LENDER
AND MCM AND THEIR RESPECTIVE DIRECTORS, OFFICERS, EMPLOYEES, INDEPENDENT
CONTRACTORS, ATTORNEYS AND AGENTS (COLLECTIVELY, THE "RELEASED PARTIES"), TO THE
FULLEST EXTENT PERMITTED BY APPLICABLE STATE AND FEDERAL LAW, FROM ANY AND ALL
ACTS AND OMISSIONS OF THE RELEASED PARTIES, AND FROM ANY AND ALL CLAIMS, CAUSES
OF ACTION, COUNTERCLAIMS, DEMANDS, CONTROVERSIES, COSTS, DEBTS, SUMS OF MONEY,
ACCOUNTS, RECKONINGS, BONDS, BILLS, DAMAGES, OBLIGATIONS, LIABILITIES,
OBJECTIONS, AND EXECUTIONS OF ANY NATURE, TYPE, OR DESCRIPTION WHICH THE
RELEASING PARTIES HAVE OR MAY HAVE AGAINST THE RELEASED PARTIES, INCLUDING, BUT
NOT LIMITED TO, NEGLIGENCE, GROSS NEGLIGENCE, USURY, FRAUD, DECEIT,
MISREPRESENTATION, CONSPIRACY, UNCONSCIONABILITY, DURESS, ECONOMIC DURESS,
DEFAMATION, CONTROL, INTERFERENCE WITH CONTRACTUAL AND BUSINESS RELATIONSHIPS,
CONFLICTS OF INTEREST, MISUSE OF INSIDER INFORMATION, CONCEALMENT, DISCLOSURE,
SECRECY, MISUSE OF COLLATERAL, WRONGFUL RELEASE OF COLLATERAL, FAILURE TO
INSPECT, ENVIRONMENTAL DUE DILIGENCE, NEGLIGENT LOAN PROCESSING AND
ADMINISTRATION, WRONGFUL SETOFF, VIOLATIONS OF STATUTES AND REGULATIONS OF
GOVERNMENTAL ENTITIES, INSTRUMENTALITIES AND AGENCIES (BOTH CIVIL AND CRIMINAL),
RACKETEERING ACTIVITIES, SECURITIES AND ANTITRUST LAWS VIOLATIONS, TYING
ARRANGEMENTS, DECEPTIVE TRADE PRACTICES, BREACH OR ABUSE OF ANY ALLEGED
FIDUCIARY DUTY, BREACH OF ANY ALLEGED SPECIAL RELATIONSHIP, COURSE OF CONDUCT OR
DEALING, ALLEGED OBLIGATION OF FAIR DEALING, ALLEGED OBLIGATION OF GOOD FAITH,
AND ALLEGED OBLIGATION OF GOOD FAITH AND FAIR DEALING, WHETHER OR NOT IN
CONNECTION WITH OR RELATED TO THE LOAN DOCUMENTS, AND/OR THIS AGREEMENT, AT LAW
OR IN EQUITY, IN CONTRACT, IN TORT, OR OTHERWISE, KNOWN OR UNKNOWN, SUSPECTED OR
UNSUSPECTED (COLLECTIVELY, THE "RELEASED CLAIMS"). THE RELEASING PARTIES FURTHER
AGREE TO LIMIT ANY DAMAGES THEY MAY SEEK IN CONNECTION WITH ANY CLAIM OR CAUSE
OF ACTION, IF ANY, TO EXCLUDE ALL PUNITIVE AND EXEMPLARY DAMAGES, DAMAGES
ATTRIBUTABLE TO LOST PROFITS OR OPPORTUNITY, DAMAGES ATTRIBUTABLE TO MENTAL
ANGUISH, AND DAMAGES ATTRIBUTABLE TO PAIN AND SUFFERING, AND THE RELEASING
PARTIES DO HEREBY WAIVE AND RELEASE ALL SUCH DAMAGES WITH RESPECT TO ANY AND ALL
EXISTING CLAIMS OR CAUSES OF ACTION AGAINST ANY OF THE RELEASED PARTIES. THE
RELEASING PARTIES REPRESENT AND WARRANT THAT NO FACTS EXIST WHICH COULD
PRESENTLY OR IN THE FUTURE COULD SUPPORT THE ASSERTION OF ANY OF THE RELEASED
CLAIMS AGAINST THE RELEASED PARTIES. THE RELEASING PARTIES FURTHER COVENANT NOT
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TO XXX THE RELEASED PARTIES ON ACCOUNT OF ANY OF THE RELEASED CLAIMS, AND
EXPRESSLY WAIVE ANY AND ALL DEFENSES THEY MAY HAVE OR COME TO HAVE IN CONNECTION
WITH THEIR DEBTS AND OBLIGATIONS UNDER THE LOAN DOCUMENTS, AND/OR THIS
AGREEMENT. THIS SECTION IS IN ADDITION TO AND SHALL NOT IN ANY WAY LIMIT ANY
OTHER RELEASE, COVENANT NOT TO XXX, OR WAIVER BY THE RELEASING PARTIES IN FAVOR
OF THE RELEASED PARTIES.
10. ENTIRE AGREEMENT. THIS AGREEMENT EMBODIES THE FINAL, ENTIRE AGREEMENT
AMONG THE PARTIES HERETO REGARDING LENDER'S AGREEMENT TO FOREBEAR FROM
CONDUCTING A FORECLOSURE SALE OF THE PROPERTY (OR AT ANY TIME THEREAFTER), AND
SUPERSEDES ANY AND ALL PRIOR COMMITMENTS, AGREEMENTS, REPRESENTATIONS AND
UNDERSTANDINGS, WHETHER WRITTEN OR ORAL, RELATING TO THE SUBJECT MATTER HEREOF
AND MAY NOT BE CONTRADICTED OR VARIED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS OR
SUBSEQUENT ORAL AGREEMENTS OR DISCUSSIONS OF THE PARTIES HERETO. THERE ARE NO
ORAL AGREEMENTS AMONG THE PARTIES HERETO. The provisions of this Agreement may
be amended or waived only by an instrument in writing signed by Lender, and
Borrower.
11. SUCCESSORS AND ASSIGNS. This Agreement shall be binding upon, and shall
inure to the benefit of, the parties hereto and their respective successors and
assigns, provided that neither Borrower may assign any rights or obligations
under this Agreement or any of the Loan Documents without the prior written
consent of Lender or its successors or assigns.
12. APPLICABLE LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF CALIFORNIA AND THE LAWS OF THE UNITED
STATES APPLICABLE TO TRANSACTIONS WITHIN CALIFORNIA.
13. COUNTERPARTS. This Agreement may be executed and delivered in any
number of counterparts, and by different parties hereto on separate
counterparts, each of which when so executed and delivered shall be deemed to be
an original and all of which counterparts taken together shall constitute one
and the same instrument; provided, however, no party shall be bound by this
Agreement until each of Lender and Borrower have executed a counterpart hereof.
Execution of this Agreement via facsimile shall be effective, and signatures
received via facsimile shall be binding upon the parties hereto and shall be
effective as originals.
14. FURTHER ASSURANCES. Borrower agrees to execute, acknowledge, deliver,
file and record such further certificates, instruments and documents, and to do
all other acts and things, as may be requested by Lender as necessary or
advisable to carry out the intents and purposes of this Agreement.
15. NO THIRD PARTY RIGHTS OR OBLIGATIONS. No person or entity not a party
to or expressly identified by name in this Agreement as a beneficiary under this
Agreement shall have any third-party beneficiary or other rights under this
Agreement. Without limiting the foregoing, this Agreement shall not affect or
impair in any manner whatsoever any rights, claims, actions, demands or causes
of action which Lender may have against Borrower or the Trust Property or any
other collateral for the indebtedness evidenced by the Loan Documents or
otherwise under or with respect to the Loan Documents.
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16. SEVERABILITY. This Agreement is intended to be performed in accordance
with, and only to the extent permitted by, all applicable laws and court
decisions. If any provision of this Agreement or the application thereof to any
person or circumstance shall, for any reason or to any extent, be invalid or
unenforceable, neither the remainder of this Agreement nor the application of
such provision to other persons or circumstances or other instruments referred
to in this Agreement shall be affected thereby, but rather the same shall be
enforced to the greatest extent permitted by law.
17. NO PARTNERSHIP OR FIDUCIARY OBLIGATIONS. Lender and Borrower expressly
acknowledge and agree that Lender has not formed, and is not hereby forming,
with Borrower and/or any other party, a partnership, joint venture or any other
similar entity, and this Agreement is not intended, and shall not be construed,
to create any such entity or relationship. Furthermore, Lender and Borrower
acknowledge and agree that Lender has no fiduciary obligations, of any type,
with respect to Borrower or any such party. IN NO EVENT SHALL LENDER EVER BE
LIABLE FOR ANY DEBTS, DUTIES OR OBLIGATIONS OF BORROWER OR WITH RESPECT TO THE
TRUST PROPERTY (UNLESS EXPRESSLY ASSUMED BY LENDER IN WRITING).
18. CONSTRUCTION. The terms, provisions and conditions of this Agreement
represent the results of negotiations between Lender and Borrower, each of whom
has either represented itself or has been represented by counsel of its own
choosing, and none of whom has acted under duress or compulsion, whether legal,
economic or otherwise. Accordingly, the terms, provisions and conditions of this
Agreement shall be interpreted and construed in accordance with their usual and
customary meanings, and Lender and Borrower expressly, knowingly and
voluntarily, waive the application, in connection with the interpretation and
construction of this Agreement, of any rule of law or procedure to the effect
that ambiguous or conflicting terms, conditions or provisions shall be
interpreted or construed against the party whose attorney prepared the executed
version or any prior drafts of this Agreement.
19. COOPERATION BY BORROWER. Upon request from Lender, from time to time,
Borrower will reasonably cooperate with and assist Lender in connection with the
enforcement by Lender of its rights and remedies under, and the defense of any
claims with respect to, the Loan Documents and this Agreement. Borrower further
agrees that, except for bona fide disputes arising after the date of this
Agreement based upon the conduct of the parties to this Agreement after the date
of this Agreement, they will not at any time challenge, contest or seek to set
aside in whole or in part the transactions provided in this Agreement.
20. HEADINGS. Descriptive headings are used in this Agreement for
convenience only and shall not control, limit, amplify or otherwise modify or
affect the terms and provisions of this Agreement or the meaning or construction
of the terms and provisions of this Agreement.
21. TIME OF ESSENCE. Time is of the essence of this Agreement and of each
covenant and agreement that is to be performed at a particular time or within a
particular period of time. However, if the date or the final date of any period
which is set out in any provision of this Agreement falls on a Saturday, Sunday
or legal holiday under the laws of the United States or the State of California,
in such event, the date or the time of such period shall be extended to the next
date which is not a Saturday, Sunday or legal holiday.
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22. ATTORNEYS' FEES. If it becomes necessary for Lender to file suit to
enforce this Agreement or any Loan Document, or any provision contained in this
Agreement or any Loan Document, or to enforce any of its rights in regard
thereto or to otherwise incur legal and/or related expenses concerning this
Agreement, on demand from Lender, and without limitation of any other rights and
remedies of Lender and Borrower agree to immediately reimburse Lender for the
attorneys' fees and other costs incurred by Lender.
(Remainder of page intentionally left blank.)
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the day and year first above written.
LENDER:
ZIONS FIRST NATIONAL BANK,
as Trustee
By:
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Xxxxxxxxx X. Xxxxxxxx,
Assistant Vice President
/s/ Xxxxxxx X. Xxxxx
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Xxxxxxx X. Xxxxx
/s/ Xxxxxxx X.X. Xxxxx
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Xxxxxxx X.X. Xxxxx
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