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EXHIBIT 10.44
THIRD AMENDMENT TO LOAN AGREEMENT AND REAFFIRMATION
AGREEMENT
This THIRD AMENDMENT TO LOAN AGREEMENT AND REAFFIRMATION AGREEMENT (as
amended, modified and in effect from time to time this "Amendment"), made as of
November 29, 2000, is by and between THE CAPITAL COMPANY OF AMERICA LLC, a
Delaware limited liability company, having an address at Two World Xxxxxxxxx
Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000-0000, Attention: General Counsel, Telefax
Number (000) 000-0000 (together with its successors and assigns, "Lender"),
ALS-VENTURE II, INC., Delaware corporation ("Borrower"), with an address of c/o
Alterra Healthcare Corporation, 00000 Xxxxxxxxxx Xxxxx, Xxxxxxxxx, Xxxxxxxxx
00000, Attention: Chief Financial Officer, Telefax Number (000) 000-0000,
ALTERRA HEALTHCARE CORPORATION f/k/a ALTERNATIVE LIVING SERVICES, INC., Delaware
corporation ("Parent Pledgor" and "Guarantor"), with an address of 00000
Xxxxxxxxxx Xxxxx, Xxxxxxxxx, Xxxxxxxxx 00000, Attention: Chief Financial
Officer, Telefax Number (000) 000-0000, and ALS-CLARE BRIDGE, INC., Delaware
corporation ("Subsidiary Pledgor"), 00000 Xxxxxxxxxx Xxxxx, Xxxxxxxxx, Xxxxxxxxx
00000, Attention: Chief Financial Officer, Telefax Number (000) 000-0000.
RECITALS
WHEREAS, Nomura Asset Capital Corporation, as Delaware Corporation, as
Lender ("Nomura"), and Borrower entered into that certain Loan Agreement made as
of May 26, 1998 as amended by that certain First Amendment to Loan Agreement and
Reaffirmation Agreement dated as of July 31, 1998, as further amended by that
certain Second Amendment to Loan Agreement, First Amendment to Guaranty and
Suretyship Agreement and Reaffirmation Agreement dated as of September, 1998
(collectively the "Original Loan Agreement") which provided, inter alia, for a
series of advances (collectively, the "Loan") from Nomura to Borrower;
WHEREAS, pursuant to that certain Assignment and Assumption Agreement
dated as of July 28, 1998, Allonge and other documents related thereto, Nomura
assigned to Lender, and Lender assumed from Nomura, all of Nomura's right,
title, interest duties and obligations in, to and under the Original Loan
Agreement and the other Loan Documents;
WHEREAS, the Loan is evidenced, inter alia, by five promissory notes
each dated as of May 26, 1998, as the same may have been or may be hereafter
further amended, modified, supplemented or restated from time to time. The Loan
is secured by, inter alia, real property, improvements and other collateral
(collectively, "Property"). Unless otherwise defined herein, capitalized terms
used in this Amendment shall have the meaning set forth in the Original Loan
Agreement;
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WHEREAS, Borrower received Advances in the aggregate amount of
$80,706,000 under the terms of the Original Loan Agreement; and
WHEREAS, Borrower and Lender both desire to further amend the Original
Loan Agreement in the manner set forth herein.
NOW, THEREFORE, in consideration of the foregoing and for other
valuable consideration the receipt and sufficiency of which are hereby
acknowledged, the parties, intending to be legally bound, hereby agree as
follows:
1. Amendments to the Original Loan Agreement.
1.1. The definition of "Interest Accrual Period" in Section 1.1 of the
Original Loan Agreement is hereby deleted in its entirety and replaced with the
following:
"Interest Accrual Period" means each period of time running from and
including the eleventh (11th) day of a calendar month to and including the tenth
(10th) day of the following calendar month during the term of the Loan. If the
Third Amendment Closing Date shall occur prior to the tenth (10th) day of a
calendar month, the first Interest Accrual Period after the Third Amendment
Closing shall commence on and include the Third Amendment Closing Date and end
on and include the tenth (10th) day of the calendar month in which the Third
Amendment Closing Date occurs. If the Third Amendment Closing Date shall occur
after the tenth (10th) day of a calendar month, the first Interest Accrual
Period after the Third Amendment Closing shall commence on the Third Amendment
Closing Date and end on and include the tenth (10th) day of the calendar month
following the month in which the Third Amendment Closing Date occurs. If the
Third Amendment Closing Date shall occur on the tenth (10th) day of a calendar
month, the first Interest Accrual Period after the Third Amendment Closing shall
consist of a one (1) day period consisting of the Third Amendment Closing Date.
1.2. The definition of "Interest Rate" in Section 1.1 of the Original
Loan Agreement is hereby deleted in its entirety and replaced with the
following:
"Interest Rate:" means, with respect to each Interest Accrual
Period, an interest rate per annum equal to (i) the Index Rate plus (ii) the
LIBOR Margin plus (iii) if Borrower exercises its option to extend the term
pursuant to Section 2.10, one hundred (100) basis points (the "Extension Option
Margin") (provided, the Extension Option Margin shall be payable in accordance
with Section 2.10).
1.3. The definition of "Loan Amount" in Section 1.1 of the Original
Loan Agreement is hereby deleted in its entirety and replaced with the
following:
"Loan Amount" means the principal amount of the Loan outstanding, as
the same may be increased or decreased, as a result of any prepayment or
otherwise from time to time; such amount is $80,706,000.00 as of November __,
2000.
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1.4. The definition of "Maturity Date" in Section 1.1 of the Original
Loan Agreement is hereby deleted in its entirety and replaced with the
following:
"Maturity Date:" means (i) August 11, 2002; provided, however, if
Borrower, exercises its option to extend such date in accordance with Section
2.10, such date shall be August 11, 2003; or (ii) such earlier date resulting
from acceleration of the Indebtedness by Lender.
1.5. The definition of "Single-Purpose Entity" in Section 1.1 of the
Original Loan Agreement is hereby amended to add to the end of each of clauses
(xiii) and (xiv) the following:
except that, prior to the occurrence of a Cash Management Event,
funds of the Borrower may be held in the name of and commingled with the general
operating account of the Manager to facilitate payment of liabilities of
Borrower by Manager in connection with the management of the Facilities,
1.6. The definition of "Yield Maintenance Premium" in Section 1.1 of
the Original Loan Agreement is hereby deleted in its entirety and replaced with
the following:
"Yield Maintenance Premium" means any hedging losses and breakage
fees and other similar costs incurred by Lender due to (i) in the event The
Capital Company of America LLC is no longer Lender hereunder, a prepayment of
the Loan on a date other than a Payment Date and/or (ii) an acceleration of the
Loan.
1.7. The following definitions are hereby added to Section 1.1 of the
Original Loan Agreement.
"2000 Prepayment Date" has the meaning set forth in Section 2.6(b).
"2000 Prepayment Total" has the meaning set forth in Section 2.6(b).
"2001 Prepayment Date" has the meaning set forth in Section 2.6(b).
"2001 Prepayment Total" has the meaning set forth in Section 2.6(b).
"2002 Prepayment Date" has the meaning set forth in Section 2.6(b).
"2002 Prepayment Total" has the meaning set forth in Section 2.6(b).
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"LIBOR Margin" has the meaning set forth in Section 2.6(b).
"Extension Commencement Date" has the meaning set forth in
Section 2.10.
"Extension Notice" has the meaning set forth in Section 2.10.
"Extension Option Margin" has the meaning set forth in the defined
term "Interest Rate."
"Extension Term" has the meaning set forth in Section 2.10.
"Index Rate" means, with respect to an Interest Accrual Period, the
greater of (a) five percent (5%) and (b) LIBOR determined as of the Interest
Determination Date immediately preceding the commencement such Interest Accrual
Period.
"Interest Determination Date" means, with respect to any LIBOR
Adjustment Date, the date which is two (2) LIBOR Banking Days prior to such
LIBOR Adjustment Date.
"LIBOR" means, with respect to any Interest Determination Date, the
rate (expressed as a percentage per annum) for deposits in U.S. Dollars for a
one (1) month period that appears on Telerate Page 3750 as of 11:00 a.m., London
time, on such Interest Determination Date. If such rate does not appear on
Telerate Page 3750 as of 11:00 a.m., London time, on the applicable Interest
Determination Date, LIBOR will be the arithmetic mean of the offered rates
(expressed as a percentage per annum) for deposits in U.S. Dollars for a one (1)
month period that appear on the Reuters Screen LIBO Page as of 11:00 a.m.,
London time, on such Interest Determination Date, if at least two (2) such
offered rates so appear. If fewer than two (2) such offered rates appear on the
Reuters Screen LIBO Page as of 11:00 a.m., London time, on the applicable
Interest Determination Date, the Lender will request the principal London office
of any four (4) major reference banks in the London interbank market selected by
the Lender to provide such bank's offered quotation (expressed as a percentage
per annum) to prime banks in the London interbank market for deposits in U.S.
Dollars for a one (1) month period as of 11:00 a.m., London time, on such
Interest Determination Date for amounts comparable to the then outstanding
Principal Indebtedness (if available). If at least two (2) such offered
quotations are so provided, LIBOR will be the arithmetic mean of such
quotations. If fewer than two (2) such quotations are so provided, the Lender
will request any three (3) major banks in New York City selected by the Lender
to provide such bank's rate (expressed as a percentage per annum) for loans in
U.S. Dollars to leading European banks for a one (1) month period as of
approximately 11:00 a.m., New York City time, on the applicable Interest
Determination Date for amounts comparable to the then outstanding Principal
Indebtedness (if available). If at least two (2) such rates are so provided,
LIBOR will be the arithmetic mean of such rates. If fewer than two (2) rates are
so provided, then LIBOR will be LIBOR in effect on the preceding LIBOR
Adjustment Date.
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"LIBOR Adjustment Date" means the eleventh (11th) day of each
calendar month; provided, however, that the first LIBOR Adjustment Date shall be
November ___, 2000. Each subsequent LIBOR Adjustment Date during the term of
this Note shall be the eleventh (11th) day of each subsequent calendar month
during the term of the Loan.
"LIBOR Banking Day" means any Business Day on which dealings in
deposits in Dollars are transacted in the London interbank market.
"Initial LIBOR Margin" means three hundred and twenty-five (325)
basis points per annum.
"LIBOR Margin" means (a) the sum of (i) as of the date hereof, and
so long as the LIBOR Margin Debt Service Coverage Ratio for all the Facilities
is less than or equal to 1.25:1, the Initial LIBOR Margin, or (ii) if the LIBOR
Margin Debt Service Coverage Ratio for all the Facilities is greater than
1.25:1, but less than or equal to 1.50:1, three hundred (300) basis points per
annum, or (iii) if the LIBOR Margin Debt Service Coverage Ratio for all the
Facilities is greater than 1.50:1, but less than or equal to 1.75:1, two hundred
and seventy-five (275) basis points per annum, or (iv) if the LIBOR Margin Debt
Service Coverage Ratio for all the Facilities is greater than 1.75:1, two
hundred and fifty (250) basis points per annum; plus (b) effective on the
Payment Date in January, 2001 (the "2001 Increase Date"), fifty (50) basis
points, if Borrower fails to prepay the 2000 Prepayment Total by the 2000
Prepayment Date (provided, however, if the Borrower pays the 2000 Prepayment
Total on a date between the 2001 Increase Date and June 11, 2001, effective as
of the Payment Date following such payment or, if such payment is made on a
Payment Date, on such Payment Date, such additional fifty (50) basis points will
no longer be payable and shall not be part of the "LIBOR Margin"); plus (c)
effective on the Payment Date in January, 2002 (the "2002 Increase Date"), an
additional fifty (50) basis points, if Borrower fails to prepay the 2001
Prepayment Total by the 2001 Prepayment Date (provided, however, if the Borrower
pays the 2001 Prepayment Total on a date between the 2002 Increase Date and June
11, 2002, effective as of the Payment Date following such payment or, if such
payment is made on a Payment Date, on such Payment Date, such additional fifty
(50) basis points will no longer be payable and shall not be part of the "LIBOR
Margin"); plus (d) if Borrower exercises the extension option set forth in
Section 2.10 hereof, effective on the Payment Date in January, 2003 (the "2003
Increase Date"), an additional fifty (50) basis points, if Borrower fails to
prepay the 2002 Prepayment Total by the 2002 Prepayment Date (provided, however,
if the Borrower pays the 2002 Prepayment Total on a date between the 2003
Increase Date and June 11, 2003, effective as of the Payment Date following such
payment or, if such payment is made on a Payment Date, on such Payment Date,
such additional fifty (50) basis points will no longer be payable and shall not
be part of the "LIBOR Margin"). On each LIBOR Margin Adjustment Date, the
portion of the LIBOR Margin described in clause (a) shall be subject to
adjustment in accordance with the foregoing as determined by Lender in its sole
discretion.
"LIBOR Margin Adjustment Date" means the eleventh (11th) day of the
calendar months November, February, May and August.
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"LIBOR Margin Debt Service" means, with respect to any LIBOR Margin
Adjustment Date, the Debt Service payable over a previous trailing twelve month
period assuming that (i) the principal indebtedness for such twelve month period
was the Principal Indebtedness on such LIBOR Margin Adjustment Date and (ii) the
interest rate payable for such twelve month period was the Interest Rate in
effect immediately prior to such LIBOR Margin Adjustment Date.
"LIBOR Margin Debt Service Coverage Ratio" means, with respect to
any LIBOR Margin Adjustment Date, and calculated for all the Facilities, the
quotient obtained by dividing Adjusted Net Operating Income for the Facilities
for the three (3) calendar months immediately preceding such LIBOR Margin
Adjustment Date as annualized by Lender by the LIBOR Margin Debt Service for the
Facilities.
"Mandatory Prepayments" has the meaning set forth in Section 2.6(b).
"Minimum Release Price" has the meaning set forth in Section 2.6.
"Mortgage Release" has the meaning set forth in Section 2.6.
"Mortgage Release Date" has the meaning set forth in Section 2.6.
"Reuters Screen LIBO Page" means the display designated as page
"LIBO" on the Reuters Monitor Money Rates Service (or such other page as may
replace the LIBO page on the service) for the purpose of displaying interbank
rates from London in U.S. Dollars.
"Telerate Page 3750" means the display designated as "Page 3750" on
the Dow Xxxxx Telerate Service (or such other page as may replace Page 3750 on
that service) or such other service as may be nominated by the British Bankers'
Association as the information vendor for the purpose of displaying British
Bankers' Association Interest Settlement Rates for U.S. Dollar deposits.
"Third Amendment Closing" means closing of the transaction evidenced
by this Amendment.
"Third Amendment Closing Date" means November __, 2000.
1.8. Section 2.1 of the Original Loan Agreement is hereby deleted in
its entirety and replaced with the following:
2.1 Amount of Loan. (a) Subject to the terms and conditions of this
Agreement, Lender has lent to Borrower a total amount of $80,706,000.
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(b) Advances Generally. Notwithstanding anything herein to the
contrary, (i) the total cumulative aggregate amount of all Advances hereunder is
$80,706,000.00, (ii) Lender shall have no obligation whatsoever to make any
further Advances, and (iii) Lender shall have no obligation whatsoever to
re-advance any amount repaid.
1.9. Section 2.5 of the Original Loan Agreement is hereby deleted in
its entirety and replaced with the following:
2.5 Principal and Interest Payments; Releases of Security Interests.
(a) Accrual of Interest. Interest shall accrue on the outstanding
principal balance of the Note and all other amounts due to Lender under the Loan
Documents at the Interest Rate.
(b) Intentionally omitted.
(c) Monthly Base Payments of Principal and Interest. On each Payment
Date, Borrower shall pay to Lender (a) a monthly payment of interest based on
the Interest Rate for the Interest Accrual Period and (b) a monthly payment of
principal (the "Monthly Principal Payment") equal to Three Hundred and Fifty
Thousand Dollars ($350,000). Each payment required to be made by Borrower
pursuant to this Section 2.5(c) is hereinafter sometimes referred to as a "Base
Payment".
(d) Intentionally omitted.
(e) Payment Dates. All payments required to be made pursuant to
paragraphs (a) and (c) above shall be made beginning on the first Payment Date
immediately following the Third Amendment Closing Date; provided, however, that
Borrower shall pay interest for the first Interest Accrual Period on the Third
Amendment Closing Date.
(f) Calculation of Interest. Interest shall accrue on the
outstanding principal balance of the Loan and all other amounts due to Lender
under the Loan Documents commencing upon the Closing Date. Interest shall be
computed on the actual number of days elapsed in each year over a 360 day year.
(g) Default Rate Interest. Upon the earlier to occur of a Late
Payment or an Event of Default, if any, the entire unpaid amount outstanding
hereunder and under the Note will bear interest at the Default Rate for so long
as such Late Payment or Event of Default remains uncured.
(h) Late Charge. If Borrower fails to make any payment of any sums
due under the Loan Documents on the date when the same is due, and the same
remains
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unpaid after the expiration of any applicable cure period, if any, Borrower
shall pay a Late Charge.
(i) Maturity Date. On the Maturity Date, Borrower shall pay to
Lender all amounts owing under the Loan Documents including, without limitation,
interest, principal, Late Charges, Default Rate interest, and any Yield
Maintenance Premium; provided, however, Yield Maintenance Premium shall only be
due and payable if the Maturity Date occurs as a result of acceleration of the
Note.
(j) Cash Management Fees. After the occurrence of a Cash Management
Event, a fee shall accrue on the outstanding principal balance of the Note and
all other amounts due to Lender under the Loan Documents at a rate of .015% per
annum which fee shall be paid, by Borrower to Lender, on each Payment Date, for
the Interest Period immediately preceding such Payment Date.
1.10. Section 2.6 of the Original Loan Agreement is hereby deleted in
its entirety and replaced with the following:
2.6 Prepayment.
(a) Voluntary Prepayments. Provided that no Default or Event of
Default has occurred and is continuing, Borrower may prepay (i) all of the Loan
or (b) part of the Loan, without premium or penalty, provided that each
prepayment shall be in an amount equal to or greater than $100,000.00 and, in
the event The Capital Company of America LLC is no longer Lender hereunder,
shall be made on a Payment Date.
(b) Mandatory Prepayments. Borrower shall prepay a portion of the
Loan (the "Mandatory Prepayments") in amounts equal to or greater than $100,000,
and in the event The Capital Company of America LLC is no longer Lender
hereunder, which Mandatory Prepayments shall be made on a Payment Date. The sum
of the Mandatory Prepayments shall be (i) Five Million Dollars and 00/100
($5,000,000) (the "2000 Prepayment Total") before December 11, 2000 (the "2000
Prepayment Date"), (ii) an additional Five Million Dollars and 00/100
($5,000,000) (the "2001 Prepayment Total") on or before December 11, 2001 (the
"2001 Prepayment Date") and (iii) in the event Borrower exercises the Extension
Option, as set forth in Section 2.10 hereinbelow, an additional Five Million
Dollars and 00/100 ($5,000,000) (the "2002 Prepayment Total") on or before
December 11, 2002 (the "2002 Prepayment Date"; the 2000 Prepayment Date, 2001
Prepayment Date and 2002 Prepayment Date are referred to herein as the
"Prepayment Dates"). If Borrower fails (i) to prepay the 2000 Prepayment Total
on or before June 11, 2001 (the "2000 Ultimate Prepayment Date"), (ii) to prepay
the 2001 Prepayment Total on or before June 11, 2002 (the "2001 Ultimate
Prepayment Date"), or (iii) in the event Borrower exercises the Extension
Option, as set forth in Section 2.10 hereinbelow, to prepay the 2002 Prepayment
Total on or before June 11, 2003 (the "2002 Ultimate Prepayment Date"; the 2000
Ultimate Prepayment Date, the 2001 Ultimate Prepayment Date and the 2002
Ultimate Prepayment Date are referred to herein collectively as the "Ultimate
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Prepayment Dates"), it shall be deemed an Event of Default under this Agreement.
Notwithstanding anything in the Loan Documents to the contrary, if Borrower
fails to pay any Mandatory Prepayment on or before its related Prepayment Date,
neither Default Interest nor Late Charges shall accrue with respect to such
Mandatory Prepayment during the period from the related Prepayment Date to the
related Ultimate Prepayment Date. Any amounts paid under Section 2.6(a) or
2.6(c) shall be applied against the Mandatory Prepayment next required to be
paid (the "Next Mandatory Prepayment"); provided, however, to the extent any
amounts in excess of the Next Mandatory Prepayment are paid, such amounts shall
be applied to the Mandatory Prepayment following the Next Mandatory Prepayment.
(c) Release of Mortgaged Property. Borrower may from time to time
obtain a release of each Mortgaged Property, as identified in Exhibit A attached
hereto and by this reference incorporated herein, from the lien of its
respective Mortgage (the "Mortgage Release"), provided that: (i) Borrower shall
have given Lender not less than thirty (30) days prior written notice,
specifying (A) the Payment Date on which to effectuate the Mortgage Release (the
"Mortgage Release Date") and (B) the Mortgaged Property to be released from the
lien of its respective Mortgage; (ii) simultaneously with each Mortgage Release,
Borrower shall convey the Mortgaged Property in question to a third party which
third party may be the parent or affiliate of Borrower; (iii) on the Mortgage
Release Date, Borrower shall have paid or cause to be paid to Lender the amount
for the Mortgaged Property in question set forth on Exhibit A attached hereto
(the "Minimum Release Price"); (iv) no Default or Event of Default shall have
occurred and be continuing at the time of the Mortgage Release Date; and (v)
Borrower shall, at its sole cost and expense, prepare any and all documents
necessary to effect the Mortgage Release, all of which shall be subject to the
reasonable approval of Lender, and shall be delivered to Lender fifteen (15)
days prior to the Mortgage Release Date, and Borrower shall pay all costs and
expenses reasonably incurred by Lender or Lender's loan servicer (including, but
not limited to reasonable attorney's fees and disbursements) in connection with
the review execution and delivery of the Mortgage Release.
(d) At Lender's election, upon the occurrence and during the
continuance of an Event of Default hereunder, in addition to all other payments
hereunder, Borrower shall pay and use all Excess Cash Flow to prepay the Loan on
each Payment Date in accordance with Section 2.11(g) and Section 2.7.
(e) If Borrower is required by Lender under the provisions of any
Mortgage to prepay the Loan or any portion thereof in the event of damage to or
destruction of, or a Taking or a Facility, Borrower shall prepay the Loan to the
full extent of the Insurance Proceeds or the Condemnation Proceeds, as
applicable, and there shall be no Yield Maintenance Premium or penalty assessed
against Borrower by reason of such prepayment.
(f) All prepayments made pursuant to this Section shall be applied
in accordance with the provisions of Section 2.7.
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(g) In the event The Capital Company of America LLC is no longer
Lender hereunder, any prepayment of the Loan by Borrower shall be made on a
Payment Date.
1.11. Section 2.10 of the Original Loan Agreement is hereby deleted in
its entirety and replaced with the following:
Section 2.10 Extension Option. Borrower shall have the right to
extend the Maturity Date from August 11, 2002 to August 11, 2003 (the period
commencing on the first (1st) day following the original Maturity Date and
ending on August 11, 2003 being referred to herein as the "Extension Term"),
provided that the following terms are complied with: (i) Borrower shall have
given Lender its written notice of such extension (an "Extension Notice") not
less than thirty (30) days prior to the original Maturity Date; (ii) on the date
of the commencement of the Extension Term (the "Extension Commencement Date"),
the Interest Rate shall be increased by the Extension Option Margin as described
in clause (iii) of the definition of the term "Interest Rate"; provided;
however, Borrower shall prepay on the Extension Commencement Date the increased
interest attributable to the Extension Option Margin that would accrue and be
payable over the Extension Term based upon the Principal Indebtedness on the
Extension Commencement Date and assuming that such Principal Indebtedness was
applicable during the Extension Term; and (iii) no Default or Event of Default
shall have occurred and be continuing at the time of the delivery of the
Extension Notice with respect to the Extension Term or on the Extension
Commencement Date. In the event the original Maturity Date is extended by the
Extension Term in accordance with the terms hereof, thereafter, all references
herein and in any of the other Loan Documents (except any such references in
this Section 2.10) to the "Maturity Date" shall be deemed to refer to August 11,
2003.
1.12. Section 2.11(a)(ii) of the Original Loan Agreement is hereby
amended to delete the third and fourth sentences thereof and replace such
sentences with the following:
Borrower shall cause the Operators for the Leased Facilities to
deposit all lease payments under the relevant Operator Leases directly into the
Collection Account and shall cause all relevant checks to be made payable to the
name of the Collection Account. For the Facilities which are not Leased
Facilities, Borrower shall cause the Manager to deposit all Rents, Moneys and
other items of Gross Revenue into the Collection Account within two (2) Business
Days of receipt thereof.
1.13. Section 2.11(b) of the Original Loan Agreement is hereby amended
to delete the first sentence thereof and replace such sentence with the
following:
Prior to the occurrence of a Cash Management Event, Borrower shall
pay from an account of Borrower to Lender or Lender's designee or to an account
identified by Lender or Lender's designee on or prior to each Payment Date, the
Required Debt Service Payment for such Payment Date, the Basic Carrying Costs
Monthly Installment for the Interest
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Accrual Period immediately preceding such Payment Date and the Capital Reserve
Monthly Installment for the Interest Accrual Period immediately preceding such
Payment Date.
1.14. The last paragraph of Section 2.11(g) of the Original Loan
Agreement is hereby deleted in its entirety and replaced with the following:
If an Event of Default has occurred and is continuing or if on any
Payment Date the balance in any Sub-Account is insufficient to make the required
payment due from such Sub-Account, Lender may, in its sole discretion, in
addition to any other rights and remedies available hereunder, withdraw funds
from any other Sub-Account to pay such deficiency; provided, however, with
respect to any Leased Facility or any Joint Venture Facility, for so long as the
Subsidiary has not acquired an equity interest in the applicable Operator or the
applicable Joint Venture, the funds in the Basic Carrying Costs Sub-Account and
the Capital Expense Sub-Account allocable to a Leased Facility or any Joint
Venture Facility shall not be used to pay any costs other than the Basic
Carrying Costs and the Capital Expenses of the related Leased Facility or Joint
Venture Facility. If Lender elects to apply funds of any such Sub-Account to pay
any Base Payment, Borrower shall, upon demand, repay to Lender the amount of
such withdrawn funds to replenish such Sub-Account, and if Borrower shall fail
to repay such amounts within three (3) Business Days after notice of such
withdrawal, an Event of Default shall exist hereunder. Notwithstanding anything
contained herein to the contrary, on the Closing Date Borrower shall deposit (i)
the Initial Basic Carrying Costs Amount into the Basic Carrying Costs
Sub-Account, (ii) the Initial Capital Reserve Amount into the Capital Reserve
Sub-Account and (iii) the Initial Debt Service Reserve Amount into the Debt
Service Reserve Sub-Account.
1.15. Section 2.13 of the Original Loan Agreement is hereby deleted in
its entirety and replaced with the following:
Section 2.13. Securitization. Borrower hereby acknowledges that
Lender, its successors or assigns, may sell or securitize the Loan or portions
thereof in one or more transactions (each, a "Securitization"; and collectively,
the "Securitizations"). Borrower agrees that it shall cooperate with Lender and
use Borrower's best efforts to facilitate the consummation of each
Securitization including, without limitation, by: (i) promptly and reasonably
providing such information as may be requested in connection with the sale of
the Loan (or portion thereof), the preparation of a private placement
memorandum, prospectus or a registration statement required to privately place
or publicly distribute the securities in a manner which does not conflict with
federal or state securities laws; (ii) providing in connection with each of (a)
a preliminary and a private placement memorandum or (b) a preliminary and final
prospectus, as applicable, an indemnification certificate (x) certifying that
Borrower has carefully examined such private placement memorandum, prospectus or
registration statement, as applicable, including, without limitation, the
sections entitled "Special Considerations", "Description of the Mortgage Loan",
"The Underlying Mortgaged Properties", "The Manager", "Borrower" and "Certain
Legal Aspects of the Mortgage Loan", and such sections (and any other sections
requested) insofar as they relate to Borrower, its Affiliates, the Loan or the
Facilities do not contain any untrue statement of a material fact or omit to
state a material fact necessary in
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order to make the statements made, in the light of the circumstances under which
they were made, not misleading; provided, however, that Borrower shall not be
required to indemnify any Indemnified Party for any losses relating to untrue
statements or omissions which Borrower identified to Lender in writing at the
time of Borrower's examination of such memorandum or prospectus, as applicable,
and (y) indemnifying each Indemnified Party, the Issuer and the Advisor for any
losses, claims, damages, costs, expenses or liabilities (including, without
limitation, all liabilities under all applicable federal and state securities
laws) (collectively, the "Liabilities") to which any of them may become subject
(i) insofar as the Liabilities arise out of or are based upon any untrue
statement or alleged untrue statement of any material fact relating to Borrower,
its Affiliates, the Loan, the Facilities, any Operator, the Manager or any
aspect of the subject financing or the parties directly involved therein
contained in such sections or arise out of or are based upon the omission or
alleged omission to state therein a material fact required to be stated in such
sections or necessary in order to make the statements in such sections, in light
of the circumstances under which they were made, not misleading or (ii) as a
result of any untrue statement of material fact in any of the financial
statements of Borrower incorporated into any placement memorandum, prospectus,
registration statement or other document connected with the issuance of
securities or the failure to include in such financial statements or in any
placement memorandum, prospectus, registration statement or other document
connected with the issuance of securities any material fact relating to
Borrower, its Affiliates, the Facilities, any Operator, the Loan, the Manager
and any aspect of the subject financing necessary in order to make the
statements therein, in light of the circumstances under which they were made,
not misleading; provided, however, that Borrower shall not be required to
indemnify any Indemnified Party for any losses relating to untrue statements or
omissions which Borrower identified to Lender in writing at the time of
Borrower's examination of such memorandum or prospectus, as applicable, and (z)
agreeing to reimburse Lender, the Issuer and the Advisor for any legal or other
expenses reasonably incurred by Lender, the Issuer and the Advisor in connection
with investigating or defending the Liabilities; (iv) causing to be rendered
such customary opinion letters as shall be requested by the Rating Agencies for
other securitizations having or seeking ratings comparable to that then being
sought for the relevant Securitization; (v) making such representations,
warranties and covenants, as may be reasonably requested by the Rating Agencies
and comparable to those required in other securitized transactions having or
seeking the same rating as is then being sought for the Securitization; (vi)
providing such information regarding the Collateral as may be reasonably
requested by the Rating Agencies or otherwise required in connection with the
formation of a REMIC; and (vii) providing any other information and materials
reasonably required in the Securitization. Borrower acknowledges and agrees that
the Lender may, at any time on or after the Closing Date, assign its duties,
rights or obligations hereunder or under any Loan Document in whole, or in part,
to a servicer and/or a trustee in Lender's discretion. Nothing herein shall in
any way limit Lender's right to sell all or a portion of the Loan in a
transaction which is not a Securitization.
1.16. Section 2.16 is hereby added to the Original Loan Agreement as
follows:
Section 2.16 Partial Releases of Mortgaged Property.
13
(a) General. At the request of Borrower and provided the terms of
this Section 2.16 are complied with, Lender will consider granting a partial
release from the lien of a Mortgage covering an unimproved portion of a
Mortgaged Property (an "Original Property") as Borrower may request (such
unimproved portion referred to herein as a "Release Parcel"; an Original
Property less a Release Parcel is referred to herein as a "Remaining Property"),
provided (i) Borrower shall deliver to Lender at least thirty (30) days prior to
the proposed release (a) a property survey of the Remaining Property meeting the
survey requirements for the survey delivered in connection with the Mortgage of
the Original Property, (b) an appraisal or qualified broker's sale analysis,
each of which must be acceptable to Lender in its discretion of the Release
Parcel, (c) a copy of the purchase and sale agreement pursuant to which the
Release Parcel is to be sold, (d) documents amending the legal description set
forth in the applicable Mortgage and the other applicable Loan Documents in form
acceptable to Lender and (f) a bring-down of the applicable Title Insurance
Policy reflecting such amendments; (ii) no Event of Default shall have occurred
and be continuing; (iii) Borrower shall pay to Lender an amount equal to 75% of
the gross sales proceeds attributable to the sale of the Release Parcel and the
amount of such gross sales proceeds shall be acceptable to Lender in its
discretion; (iv) Borrower shall pay all of Lender's costs and expenses
(including reasonable legal fees and disbursements) incurred in connection with
the contemplated transaction and in connection with Lender's review of the
matters described in this Section 2.16(a) and the determination of the
satisfaction of the conditions set forth herein and otherwise incurred in
connection with the Release Parcel; and (v) Borrower shall have delivered to
Lender evidence reasonably satisfactory to Lender that:
(i) all Legal Requirements (including, without limitation, all
zoning and subdivision laws, set back requirements, side line requirements,
parking ratio requirements, use requirements and building and fire code
requirements) applicable to the Remaining Property have been complied with;
(ii) as a result of the conveyance of the Release Parcel and the
release of the Release Parcel from the lien of the applicable Mortgage, the
Remaining Property, considered alone, will not be in violation of any Legal
Requirements;
(iii) the conveyance on the Release Parcel and the release of the
Release Parcel from the lien of the applicable Mortgage will not result in the
breach of any agreement, including, without limitation, any Lease, affecting the
Remaining Property;
(iv) the Release Parcel is not necessary for the ingress or
egress to the Remaining Property;
(v) the Remaining Property and the Release Parcel shall be
separate tax lots as evidenced by an endorsement to the applicable Title
Insurance Policy or, if separate tax lot status cannot be obtained prior to the
sale of the Release Parcel, Borrower and the purchaser of the Release Parcel
shall have filed applications to receive such separate tax lot
14
status; provided, however, until such applications are granted, Borrower shall
include in the Basic Carrying Costs Monthly Installment the amount of real
property taxes, assessments and Impositions for the entire Original Property;
(vi) Borrower shall, simultaneously with the release of the
Release Parcel, sell and convey the Release Parcel to a bonafide third party on
commercially reasonable terms similar to those of an arms-length transaction;
and
(vii) the Release Parcel may not, under the provisions of any
Applicable Laws (including applicable zoning ordinances), be used for any
purpose which Lender determines may have an adverse impact on the Remaining
Property or is otherwise inconsistent with the use of the Remaining Property.
(b) Sun City West Partial Release. At the request of Borrower and
provided the terms of this Section 2.16(b) are complied with, Lender shall
release from the lien of the applicable Mortgage (the "Sun City West Mortgage")
covering a portion of the Mortgaged Property referred to as Sun City West (the
"Original Sun City West Property"), as more particularly described on the
attached Schedule 1 attached hereto (the "Sun City West Release Parcel"; the
Original Sun City West Property less the Sun City West Release Parcel is
referred to herein as the "Sun City West Remaining Property"), provided (i)
Borrower shall deliver to Lender at least thirty (30) days prior to the proposed
release (a) a property survey of the Sun City West Remaining Property meeting
the survey requirements for the survey delivered in connection with the Mortgage
of the Original Property, (b) intentionally deleted, (c) a copy of the purchase
and sale agreement pursuant to which the Sun City West Release Parcel is to be
sold, (d) documents amending the legal description set forth in the Sun City
West Mortgage and the other applicable Loan Documents in form acceptable to
Lender and (f) a bring-down of the applicable Title Insurance Policy reflecting
such amendments; (ii) no Event of Default shall have occurred and be continuing;
(iii) Borrower shall pay to Lender an amount equal to 75% of the gross sales
proceeds (which the purchase agreement between the Borrower and Purchaser
currently states shall be $290,000) attributable to the sale of the Sun City
West Release Parcel and the amount of such gross sales proceeds shall be
acceptable to Lender in its discretion (gross proceeds of $290,000 being hereby
acknowledged as acceptable to Lender); (iv) Borrower shall pay all of Lender's
costs and expenses (including reasonable legal fees and disbursements) incurred
in connection with the contemplated transaction and in connection with Lender's
review of the matters described in this Section 2.16 and the determination of
the satisfaction of the conditions set forth herein and otherwise incurred in
connection with the Sun City West Release Parcel; and (v) Borrower shall have
delivered to Lender evidence reasonably satisfactory to Lender that:
(i) all Legal Requirements (including, without limitation, all
zoning and subdivision laws, set back requirements, side line requirements,
parking ratio requirements, use requirements and building and fire code
requirements) applicable to the Sun City West Remaining Property have been
complied with;
15
(ii) as a result of the conveyance of the Sun City West Release
Parcel and the release of the Sun City West Release Parcel from the lien of the
Sun City West Mortgage, the Sun City West Release Parcel, considered alone, will
not be in violation of any Legal Requirements;
(iii) the conveyance of the Sun City West Release Parcel and the
release of the Sun City West Release Parcel from the lien of the Sun City West
Mortgage will not result in the breach of any agreement, including, without
limitation, any Lease, affecting the Sun City West Remaining Property;
(iv) the Sun City West Release Parcel is not necessary for the
ingress or egress to the Sun City West Remaining Property;
(v) Sun City West Remaining Property and the Sun City West
Release Parcel shall be separate tax lots as evidenced by an endorsement to the
applicable Title Insurance Policy or, if separate tax lot status cannot be
obtained prior to the sale of the Sun City West Release Parcel, Borrower and the
purchaser of the Sun City West Release Parcel shall have filed applications to
receive such separate tax lot status; provided, however, until such applications
are granted, Borrower shall include in the Basic Carrying Costs Monthly
Installment the amount of real property taxes, assessments and Impositions for
the entire Sun City West Original Property.
(vi) Borrower shall, simultaneously with the release of the Sun
City West Release Parcel, sell and convey the Sun City West Release Parcel to a
bonafide third party on commercially reasonable terms similar to those of an
arms-length transaction; and
(vii) the Sun City West Release Parcel may not, under the
provisions of any Applicable Laws (including applicable zoning ordinances), be
used for any purpose which Lender determines may have an adverse impact on the
Sun City West Remaining Property or is otherwise inconsistent with the use of
the Sun City West Remaining Property.
1.17. Section 5.1(p) of the Original Loan Agreement is hereby deleted
in its entirety and replaced with the following:
(p) Management of Mortgaged Property. Each Facility will be managed
at all times by the Manager pursuant to the Management Agreement unless
terminated as herein provided. Any Management agreement shall be terminated by
Borrower or the relevant Operator, if any, as applicable, at Lender's request,
upon thirty (30) days prior written notice to Borrower and the Manager (i) upon
the occurrence of an Event of Default, (ii) if the Manager commits any act which
would permit termination by Borrower or the relevant Operator, as applicable,
under the Management Agreement or (iii) if as of the last day of any calendar
quarter, the Adjusted Net Operating Income for all the Facilities remaining
subject to the Mortgages at such time, computed on the basis of the prior twelve
(12) calendar months, is less than the product of (x) seventy-five percent (75%)
and (y) the aggregate Adjusted Net Operating Income as of the Third Amendment
Closing Date (as set forth on Schedule 2 attached hereto) for the
16
Facilities then subject to the Mortgages and remains less than such seventy-five
percent (75%) of the Adjusted Net Operating Income for three (3) consecutive
months computed in each case on the basis of the prior twelve (12) calendar
months. If a manager is terminated pursuant hereto, Borrower shall immediately
seek to appoint a replacement manager acceptable to Lender in Lender's
discretion, and Borrower's failure to appoint an acceptable manager within sixty
(60) days after Lender's request of Borrower to terminate any Management
Agreement shall constitute an immediate Event of Default. Borrower may from time
to time appoint a successor manager to manage the relevant Facilities, which
successor manager shall be approved in writing by Lender in Lender's reasonable
discretion. Notwithstanding the foregoing, any successor manager selected
hereunder by Lender or Borrower to serve as Manager (i) shall be a reputable
management company having at least seven (7) years' experience in the management
of commercial properties with similar uses as the Facilities and in the
jurisdictions in which the relevant Facility or Facilities are located and (ii)
shall not be paid management fees in excess of fees which are market fees for
comparable managers of comparable properties in the same geographic area.
1.18. Section 8.6 of the Original Loan Agreement is hereby deleted in
its entirety and replaced with the following:
Section 8.6 Notices. All notices, consents, approvals and
requests required or permitted hereunder or under any other Loan Document shall
be given in writing and shall be effective for all purposes if hand delivered or
sent by (a) hand delivery, with proof of attempted delivery, (b) certified or
registered United States mail, postage prepaid, (c) expedited prepaid delivery
service, either commercial or United States Postal Service, with proof of
attempted delivery, or (d) by telecopier (with answerback acknowledged) provided
that such telecopied notice must also be delivered by one of the means set forth
in (a), (b) or (c) above, addressed if to Lender at its address set forth on the
first page hereof, and if to Borrower at its designated address set forth on the
first page hereof, or at such other address and Person as shall be designated
from time to time by any party hereto, as the case may be, in a written notice
to the other parties hereto in the manner provided for in this Section 8.6. A
copy of all notices, consents, approvals and requests directed to Lender shall
be delivered concurrently to each of the following: Dechert , 00 Xxxxxxxxxxx
Xxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: G. Xxxxxxx Xxxxxxxx, Esquire,
Telefax Number 212/698-3599; Two World Xxxxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx
00000-0000, Attention: General Counsel, Telefax Number (000) 000-0000; Two World
Financial Xxxxxx, Xxxxxxxx X, Xxx Xxxx, XX 00000-0000; copies of notices to
Borrower shall be delivered concurrently to each of the following: Xxxx X. Xxxx,
Xxxxxx & Xxxxxx, 2700 International Tower, Peachtree Center, 000 Xxxxxxxxx
Xxxxxx, X.X., Xxxxxxx, Xxxxxxx 00000, Telefax Number (000) 000-0000, and Alterra
Healthcare Corporation, 00000 Xxxxxxxxxx Xxxxx, Xxxxxxxxx, Xxxxxxxxx 00000,
Attention: Xxxx Xxxxxxxxx, Telefax Number (000) 000-0000. A notice shall be
deemed to have been given: (a) in the case of hand delivery, at the time of
delivery; (b) in the case of registered or certified mail, when delivered or the
first attempted delivery on a Business Day; (c) in the case of expedited prepaid
delivery upon the first attempted delivery on a Business Day; or (d) in the case
of telecopier, upon receipt of
17
answerback confirmation, provided that such telecopied notice was also delivered
as required in this Section 8.6. A party receiving a notice which does not
comply with the technical requirements for notice under this Section 8.6 may
elect to waive any deficiencies and treat the notice as having been properly
given.
1.19. Section 8.14 of the Original Loan Agreement is hereby deleted in
its entirety and replaced with the following:
Section 8.14 Exculpation. The Loan shall be fully recourse to the
Borrower and the Parent.
1.20. Sections 2.15 and 8.32 of the Original Loan Agreement, Exhibits
D, E, F and G of the Original Loan Agreement and the following definitions from
Section 1.1 of the Original Loan Agreement are hereby deleted in their entirety
and all references to such sections and defined terms in the Original Loan
Agreement or any of the other Loan Documents shall be interpreted and construed
as if such terms had been deleted from such document and shall be null and void,
and of no further force and effect:
"Accrued Interest," "Actual Prepayment Amount," "Additional
Facility," "Amortizable Amount," "Class B Amount," "Class B equity Interests,"
"Class C Amount," "Class C Equity Interests," "Cut-Off Date," "Default
Collateral," "Defeasance Debt Service Coverage Ratio," "Defeasance Deposit,"
"Defeasance Release Date," "Difference," "Earn-Out Advance," "Final Rate Lock,"
"Initial Interest Rate," "Initial Securitization Expense Amount," "Maximum
Additional Facility Advance Amount," "Optional Prepayment Date," "Preferred Cash
Collateral Account," "Preferred Cash Collateral Account Bank," "Preferred Cash
Management Agreement", "Preferred Equity Holder," "Recalculated Loan Amount,"
"Recourse Distributions," "Remaining Property," "Replaced Property," "Required
Base Debt Service Payment," "Revises Interest Rate," "Securitization Costs,"
"Securitization Expense Sub-Account," "Spread " "Stabilization Date,"
"Stabilization Date Loan Amount," "Stabilization Date Payment Date,"
"Stabilization Interest Rate," "Stabilization Optimum Debt Service Coverage
Ratio," "Successor Obligor," "Substitute Loan Documents," "Substitute Property,"
"Ten Year Treasury Rate," "Treasury Rate," "Unpaid Excess Loan Amount,"
"Underwriting NOI Criteria," "Unpaid Excess Loan Amount," "Warrant," "Security
Agreement."
1.21. Exhibit B of the Original Loan Agreement is hereby deleted in its
entirety and replaced with the Exhibit B attached hereto.
2. Severability. In case any provision of this Amendment shall be invalid,
illegal, or unenforceable, such provision shall be deemed to have been modified
to the extent necessary to make it valid, legal, and enforceable. The validity,
legality, and enforceability of the remaining provisions shall not in any way be
affected or impaired thereby.
3. No Modification Except in Writing. None of the terms of this Amendment may be
modified, waived, altered, amended, supplemented, extended, consolidated,
replaced, exchanged
18
or otherwise changed except by an instrument in writing duly executed by all of
the parties hereto.
4. Further Assurances. Borrower shall execute and deliver such further
instruments and perform such further acts as may be requested by Lender from
time to time to confirm the provisions of this Amendment and the Loan Documents,
to carry out more effectively the purposes of this Amendment and the Loan
Documents, or to confirm the priority of any Lien created by any of the Loan
Documents.
5. Representations and Warranties. Without limiting in any way any
representation or warranty in any Loan Document, Borrower and Guarantor each
represent and warrant that as of the date hereof:
5.1. Organization. (a) Borrower (i) is a duly organized and validly
existing corporation in good standing under the laws of the State of its
formation, (ii) has the requisite corporate power and authority to carry on its
business as now being conducted, (iii) is duly qualified to do business in each
jurisdiction in which the nature of its business, the Property or any of its
collateral makes such qualification necessary or desirable, and (iv) has the
requisite corporate power to execute and deliver, and perform its obligations
under, this Amendment.
(b) Guarantor (i) is a duly organized and validly
existing corporation in good standing under the laws of the State of its
formation, (ii) has the requisite corporate power and authority to carry on its
business as now being conducted, (iii) is duly qualified to do business in each
jurisdiction in which the nature of its business, the Property or any of its
collateral makes such qualification necessary or desirable, and (iv) has the
requisite corporate power to execute and deliver, and perform its obligations
under, this Amendment.
5.2. Authorization. (a) The execution and delivery by Borrower of this
Amendment, Borrower's performance of its obligations hereunder (i) have been
duly authorized by all requisite corporate action on the part of Borrower, (ii)
will not violate any provision of any applicable legal requirements, decree,
injunction or demand of any court or other governmental authority, any
organizational document of Borrower or any indenture or agreement or other
instrument to which Borrower is a party or by which Borrower is bound, (iii)
will not be in conflict with, result in a breach of, or constitute (with due
notice or lapse of time or both) a default under, or result in the creation or
imposition of any Lien of any nature whatsoever upon any of the property or
assets of Borrower pursuant to, any such indenture or agreement or instrument
and (iv) have been duly executed and delivered by Borrower. Except for those
obtained or filed on or prior to the date hereof, Borrower is not required to
obtain any consent, approval or authorization from, or to file any declaration
or statement with, any governmental authority or other agency in connection with
or as a condition to the execution, delivery or performance of this Amendment.
This Amendment has been duly authorized, executed and delivered by Borrower.
19
(b) The execution and delivery by Guarantor of
this Amendment, Guarantor's performance of its obligations hereunder (i) have
been duly authorized by all requisite corporate action on the part of Guarantor,
(ii) will not violate any provision of any applicable legal requirements,
decree, injunction or demand of any court or other governmental authority, any
organizational document of Guarantor or any indenture or agreement or other
instrument to which Guarantor is a party or by which Guarantor is bound, (iii)
will not be in conflict with, result in a breach of, or constitute (with due
notice or lapse of time or both) a default under, or result in the creation or
imposition of any Lien of any nature whatsoever upon any of the property or
assets of Guarantor pursuant to, any such indenture or agreement or instrument
and (iv) have been duly executed and delivered by Guarantor. Except for those
obtained or filed on or prior to the date hereof, Guarantor is not required to
obtain any consent, approval or authorization from, or to file any declaration
or statement with, any governmental authority or other agency in connection with
or as a condition to the execution, delivery or performance of this Amendment.
This Amendment has been duly authorized, executed and delivered by Guarantor.
5.3. Full and Accurate Disclosure. No statement of fact made by or on
behalf of Borrower or Guarantor in this Amendment or in any other document or
certificate delivered to Lender by Borrower or Guarantor contains any untrue
statement of a material fact or omits to state any material fact necessary to
makes statements contained herein or therein not misleading. There is no fact
presently known to Borrower or Guarantor which has not been disclosed to Lender
which materially adversely affects, nor as far as Borrower or Guarantor can
foresee, might materially adversely affect the business, operations or condition
(financial or otherwise) of Borrower or Guarantor.
5.4. No Offsets; Defenses. There are no existing claims by Borrower or
Guarantor against Lender and there are no offsets or defenses by Borrower or
Guarantor to the payment of any amounts required under the Loan Documents or
otherwise to the enforcement by Lender of the Loan Documents.
5.5. Enforceability. (a) This Amendment is a legal, valid and binding
obligation of Borrower, enforceable against Borrower in accordance with its
terms, subject to bankruptcy, insolvency and other limitations on creditors'
rights generally and to equitable principles.
(b) This Amendment is a legal, valid and binding
obligation of Guarantor, enforceable against Guarantor in accordance with its
terms, subject to bankruptcy, insolvency and other limitations on creditors'
rights generally and to equitable principles.
5.6. Equity Infusion. On May 31, 2000 Guarantor consummated the sale of
the following securities in accordance with the Purchase agreement dated as of
April 26, 2000 among Guarantor, RDVEPCO, L.L.C., Group One Investors, L.L.C. and
Holiday Retirement 2000, LLC, as amended by that certain First Amendment dated
May 31, 2000: (i) $5,000,000 of its Series A 9.75% Convertible Pay-in-Kind
Preferred Stock (mandatory redemption in seven (7) years), (ii) $1,425,000.00 of
its Series A 9.75% Convertible Pay-in-Kind Debentures (seven (7)
20
year maturity)), $90,354,000 of its Series B 9.75% Convertible Pay-in-Kind
Debentures (seven (7) year maturity) and (iv) $35,095,636 of its Series C 9.75%
Convertible Pay-in-Kind Debentures (seven (7) year maturity).
5.7. Survival of Representations and Warranties. (a) Without in any way
limiting any provision of any Loan Document which provides for a longer period
of survival, Borrower hereby agrees that (i) all representations and warranties
made by Borrower in this Amendment shall continue for so long as any amount
remains owing to Lender under this Amendment, the Note or any of the other Loan
Documents, and (ii) all representations, warranties, covenants and agreements
made in this Amendment shall be deemed to have been relied upon by Lender
notwithstanding any investigation heretofore or hereafter made by Lender or on
its behalf.
(b) Without in any way limiting any provision of any Loan
Document which provides for a longer period of survival, Guarantor hereby agrees
that (i) all representations and warranties made by Guarantor in this Amendment
shall continue for so long as any amount remains owing to Lender under this
Amendment, the Note or any of the other Loan Documents, and (ii) all
representations, warranties, covenants and agreements made in this Amendment
shall be deemed to have been relied upon by Lender notwithstanding any
investigation heretofore or hereafter made by Lender or on its behalf.
5.8. Reaffirmation. Each of Borrower, Guarantor, Parent Pledgor and
Subsidiary Pledgor hereby ratifies and reaffirms the obligations, waivers,
indemnities and covenants made under the Loan Documents to which each is bound.
5.9. Confirmation of Specific Obligations. Borrower confirms, as of the
date hereof, that (i) the Manager has executed a Management Agreement with the
Operators of those Facilities set forth on Exhibit C attached hereto and with
the Borrower for all of the other Facilities; (ii) Borrower and Manager have
delivered to Lender a Manager's Subordination for all of the Facilities; (iii)
except for the Facilities set forth on Exhibit C attached hereto, the Borrower
has terminated the Operator Lease for each Facility and each related Operator no
longer leases any Facility; and (iv) within one (1) year of the date of this
Amendment (A) Borrower or an affiliate of Borrower will have acquired all third
parties interests in the Operator's listed on Exhibit C; (B) Borrower will
terminate the related Operator Lease; (C) Manager will execute a Management
Agreement with Borrower for the Facilities listed on Exhibit C; and (D) Borrower
will execute amendments to the Loan Documents as requested by Lender to
memorialize the foregoing matters.
6. Miscellaneous.
6.1. This Amendment together with the Note and the other Loan Documents
as they have or may be modified, amended, supplemented and in effect from time
to time constitutes the entire agreement among the parties concerning its
subject matter.
21
6.2. This Amendment shall inure to the benefit of and be binding upon
the parties and their respective heirs, successors and assigns.
6.3. This Amendment may be executed in two or more counterparts each of
which shall be deemed an original, but all of which together shall constitute
one and the same instrument.
6.4. Borrower and Guarantor each confirms and ratifies the terms and
provisions of the Loan Documents to which it is a party as modified hereby and
agrees that the Loan Documents, as so modified, remain in full force and effect
as of the date hereof, and nothing herein contained shall be construed to impair
the security or affect the first priority of the lien of any mortgage, nor
impair any rights or powers which Lender or its successors may have for
nonperformance of any term of any of the Loan Documents.
6.5. This Amendment is solely intended to and shall amend the Original
Loan Agreement. Nothing in this Amendment is intended to or shall impair any
Lien which Lender ever had, now has, or may hereafter have on any property of
Borrower under the Loan Documents including, without limitation, the Collateral.
6.6. This Amendment shall be governed by and construed in accordance
with the laws of the State of New York (without giving effect to New York's
principles of conflict of law).
6.7. Any reference to the Loan Agreement in any of the Loan Documents
shall hereafter mean the Original Loan Agreement as amended by this Amendment as
the same may be subsequently amended, modified, altered, supplemented, extended,
consolidated, replaced, exchanged or otherwise changed.
[Signatures commence on the following page]
22
IN WITNESS WHEREOF, the parties hereto have caused this THIRD AMENDMENT
TO LOAN AGREEMENT AND REAFFIRMATION AGREEMENT to be duly executed by their duly
authorized representatives, all as of the day and year first above written.
LENDER:
THE CAPITAL COMPANY OF AMERICA LLC, a
Delaware limited liability company
By: /s/ Xxxxxx Xxxxx
----------------------------------------------
Name: Xxxxxx Xxxxx
---------------------------------------
Title: Managing Director
--------------------------------------
[signatures continued on following page]
23
BORROWER:
ALS-VENTURE II, INC., a Delaware corporation
By: /s/ Xxxx Xxxxxxxxx
------------------------------------------
Xxxx Xxxxxxxxx
Vice President
PARENT PLEDGOR/GUARANTOR:
ALTERRA HEALTHCARE CORPORATION f/k/a
ALTERNATIVE LIVING SERVICES,
INC, a Delaware corporation
By: /s/ Xxxx Xxxxxxxxx
------------------------------------------
Xxxx Xxxxxxxxx
Senior Vice President
SUBSIDIARY PLEDGOR:
ALS-CLARE BRIDGE, INC., a Delaware corporation
By: /s/ Xxxx Xxxxxxxxx
------------------------------------------
Xxxx Xxxxxxxxx
Vice President
24
SCHEDULE 1
Attach legal description of Sun City West Release Parcel
25
SCHEDULE 2
Adjusted Net Operating Income Schedule as of the Third Amendment
Closing Date
Facility Name Adjusted NOI
------------- ------------
Clare Bridge of Xxxxxxx (II) 77,532
Clare Bridge of Cheswick 136,731
Clare Bridge of Eagan 397,174
Clare Bridge of Murrysville 359,955
Clare Bridge of Oviedo (I)/Sterling House of Oviedo (II and III) 627,389
Clare Bridge of Sun City West 189,833
Xxxxxxxx House of Portage/Wynwood of Portage 617,358
Sterling Cottage of Goodlettsville 374,764
Sterling House of Cape Coral 401,417
Sterling House of Columbia 87,292
Sterling House of Littleton 554,646
Sterling House of Maryville 358,153
Sterling House of Rock Hill 353,893
Sterling House of South Bend 367,467
WovenHearts of Battle Creek (I and II) 229,559
WovenHearts of Bay City (I and II) 451,752
WovenHearts of Xxxx Rapids (I and II) 152,692
WovenHearts of Midland (I and II) 321,854
WovenHearts of Monroe (I and II) 488,339
WovenHearts of Penn Hills 125,045
WovenHearts of Saginaw (I and II) 376,887
WovenHearts of Xxxxxx Creek 128,861
WovenHearts of West St. Xxxx (I and II) 443,318
WovenHearts of Westland (I and II) 25,129
Wynwood of Xxxxx (I) -110,249
GRAND TOTAL 7,536,791
26
EXHIBIT A
MINIMUM RELEASE PRICES
Facility Name Release Price
------------- -------------
Clare Bridge of Xxxxxxx (II) 2,400,000
Clare Bridge of Cheswick 3,500,000
Clare Bridge of Eagan 4,800,000
Clare Bridge of Murrysville 3,200,000
Clare Bridge of Oviedo (I)/Sterling House of Oviedo (II and III) 7,100,000
Clare Bridge of Sun City West 4,600,000
Xxxxxxxx House of Portage/Wynwood of Portgage 8,400,000
Sterling Cottage of Goodlettsville 2,500,000
Sterling House of Cape Coral 2,800,000
Sterling House of Columbia 2,200,000
Sterling House of Littleton 3,000,000
Sterling House of Maryville 2,500,000
Sterling House of Rock Hill 2,706,000
Sterling House of South Bend 2,600,000
WovenHearts of Battle Creek (I and II) 2,400,000
WovenHearts of Bay City (I and II) 2,700,000
WovenHearts of Xxxx Rapids (I and II) 3,100,000
WovenHearts of Midland (I and II) 2,800,000
WovenHearts of Monroe (I and II) 3,000,000
WovenHearts of Penn Hills 1,600,000
WovenHearts of Saginaw (I and II) 2,600,000
WovenHearts of Xxxxxx Creek 1,100,000
WovenHearts of West St. Xxxx (I and II) 2,500,000
WovenHearts of Westland (I and II) 2,600,000
Wynwood of Xxxxx (I) 4,000,000
27
EXHIBIT B
Additional Definitions
Closing Date Advance (May 26, 1998) $32,516,000
Initial Basic Carrying Costs Amount $121,905.16
Initial Capital Reserve Amount $ 0
Additional Facility Advance (July 31, 1998) $21,330,000
Additional Facility Advance (September ___, 1998) $26,860,000
ALLOCATED LOAN AMOUNTS
1. Clare Bridge of Cheswick $4,271,000
Cheswick, PA
2. Clare Bridge of Murrysville $3,358,000
Export, PA
3. Sterling House of Columbia $2,352,000
Columbia, SC
4. Sterling House of Rock Hill $2,259,000
Rock Hill, SC
5. WovenHearts of Battle Creek $2,495,000
Battle Creek, MI
6. WovenHearts of Bay City $2,478,000
Bay City, MI
7. WovenHearts of Midland $2,500,000
Midland, MI
8. WovenHearts of Monroe $2,769,000
Monroe, MI
28
9. WovenHearts of Penn Hills $1,690,000
Penn Hills, PA
10. WovenHearts of Saginaw $2,547,000
Saginaw Township, MI
11. WovenHearts of Xxxxxx Creek $1,069,000
Xxxxxx Creek, MI
12. WovenHearts of West St. Xxxx $2,206,000
West St. Xxxx, MN
13. WovenHearts of Westland $2,502,000
Westland, MI
14. Sterling House of South Bend $2,210,000
South Bend, IN
15. WovenHearts of Xxxx Rapids $3,330,000
Coon Rapids, MN
16. Clare Bridge of Oviedo/ $6,960,000
WovenHearts of Oviedo
Oviedo, FL
17. Xxxxxxxx House of Portage/ $8,850,000
Wynwood of Portage
Portage, MI
18. Wynwood of Xxxxx (I) $5,650,000
Mars, PA
19. Clare Bridge of Sun City West $4,610,000
Sun City West, AZ
20. Clare Bridge of Eagan $4,500,000
Eagan, MN
21. Clare Bridge of Brandon (II) $2,530,000
Brandon, FL
22. Sterling House of Maryville $2,300,000
Maryville, TN
29
23. Sterling House of Littleton $2,730,000
Littleton, CO
24. Sterling Cottage of Goodlettsville $2,180,000
Goodlettsville, TN
25. Sterling House of Cape Coral $2,360,000
Cape Coral, FL
LEASED FACILITIES OPERATOR ADDRESS
----------------- -------- -------
Alterra Clare Bridge of ALS-Indiana (PA) 000 Xxxxx 000
Xxxxxxxx Partners, a Pennsylvania Xxxxxxxx, XX 00000
Xxxxxxxx, XX general partnership
Alterra Wynwood of Wynwood of Xxxxx X.X., a 10 Xxxxx Ridge Blvd.,
Xxxxx (I) Delaware limited partnership Mars, PA
NONLEASED FACILITIES ADDRESS
-------------------- -------
WovenHearts of Battle Creek 000/000 Xxxx Xxxxx
Xxxxxx Xxxxx, XX Xxxxxxxxxxx, XX 00000
WovenHearts of Penn Hills 0000 Xxxxxxxxx Xxxx
Xxxx Xxxxx, XX Xxxx Xxxxx, XX 00000
WovenHearts of Xxxxxx Creek 0000 Xxxxxx Xxxx
Xxxxxx Xxxxx, XX Xxxxxx Creek, MI 48476
Clare Bridge of Murrysville 0000 Xxx Xxxxxxx
Xxxxxx, XX Xxxx Xxxxxxx
Xxxxxx, XX 00000
Sterling House of Columbia 000 Xxxxxxxxxx Xxxxx
Xxxxxxxx, XX Xxxxxxxx, XX 00000
Sterling House of Rock Hill 0000 Xxxxxxxx Xxxx
Xxxx Xxxx, XX Xxxx Xxxx, XX 00000
WovenHearts of Bay City 000/000 X. Xxxx Xxxx
Xxx Xxxx, XX Xxx Xxxx, XX 00000
30
NONLEASED FACILITIES ADDRESS
-------------------- -------
WovenHearts of Midland 0000/0000 Xxxxx Xxxxxx
Xxxxxxx, XX Xxxxxxx, XX 00000
WovenHearts of Monroe 0000/0000 Xxxxxxxxxx Xxxxx
Xxxxxx, XX Xxxxxx, XX 00000
WovenHearts of Saginaw 0000/0000 XxXxxxx Xxxx
Xxxxxxx, XX Xxxxxxx, XX 00000
WovenHearts of West 000/000 X. Xxxxxxxx
Xxxxxx Xx. Xxxx Xxxx Xx. Xxxx, MN 55118
West St. Xxxx, MN
WovenHearts of Westland 32111/32151 Cherry Xxxx Xx.
Westland, MI Xxxxxxxx, XX 00000
Sterling House of 00000 Xxxxx Xxxx 00,
Xxxxx Xxxx Xxxxx Xxxx, XX
WovenHearts of Xxxx Rapids (I) 0000 000xx Xxxx,
Xxxx Xxxxxx, XX
WovenHearts of Xxxx Rapid (II) 00000 Xxxxxxxx Xxxxx,
Xxxx Xxxxxx, XX
Clare Bridge of Oviedo (I) 000 Xxxxxxxxxx Xxxx.,
Xxxxxx, XX
WovenHearts of Oviedo (II) 000 Xxxxxxx Xxxxx Xxxx.,
Xxxxxx, XX
WovenHearts of Oviedo (III) 000 Xxxxxxx Xxxxx Xxxx.,
Xxxxxx, XX
Xxxxxxxx House of Portage 0000 Xxx Xxxxxx Xxxxxx,
Xxxxxxx, XX
Wynwood of Portage 0000 Xxx Xxxxxx Xxxxxx,
Xxxxxxx, XX
Clare Bridge of Sun City 00000 X. Xxxxxx Xxxx.,
31
NONLEASED FACILITIES ADDRESS
-------------------- -------
West Sun City West, AZ
Clare Bridge of Eagan 0000 Xxxxxxxxxx Xxxx,
Xxxxx, XX
Sterling House of Brandon 000 X. Xxxxxxx Xxxxxx,
Xxxxxxx, XX
Sterling House of 000 Xxxxxxx Xxxxxxx Xxxx,
Xxxxxxxxx Xxxxxxxxx, XX
Sterling House of 0000 X. Xxxxxxxxxxx
Xxxxxxxxx Xxxxxx Xxxx, Xxxxxxxxx, XX
Sterling Cottage of 0000 Xxxxxxxx Xxxxx,
Xxxxxxxxxxxxxx Xxxxxxxxxxxxxx, XX
Sterling House of 0000 Xxxxxxx Xxxx Xxxx,
Xxxx Xxxxx Xxxx Xxxxx, XX
JOINT VENTURE FACILITIES JOINT VENTURE ADDRESS
None
ADDITIONAL FACILITIES
None
SUBLEASED FACILITIES
None
* The Initial Basic Carrying Costs are allocated among the Facilities as
follows:
Real Estate Insurance
Facility Taxes Premiums
-------- ----------- ---------
Clare Bridge of Cheswick $ 3,333.33 $ 640.00
32
Real Estate Insurance
Facility Taxes Premiums
-------- ----------- ---------
Clare Bridge of Murrysville 2,083.33 608.25
Sterling House of Columbia 2,730.92 504.17
Sterling House of Rock Hill 2,482.67 458.33
WovenHearts of Battle Creek (I) & (II) 4,583.33 596.00
WovenHearts of Bay City (I) & (II) 2,700.00 596.00
WovenHearts of Midland (I) & (II) 2,700.00 596.00
WovenHearts of Monroe (I) & (II) 2,700.00 596.00
WovenHearts of Penn Hills 2,916.67 300.00
WovenHearts of Saginaw (I) & (II) 2,700.00 596.00
WovenHearts of Xxxxxx Creek 2,416.67 298.00
WovenHearts of West St. Xxxx (I) & (II) 2,700.00 596.00
WovenHearts of Westland (I) & (II) 4,583.33 596.00
Sterling House of SouthBend 2,979.17 650.00
WovenHearts of Xxxx Rapids (I) & (II) 6,883.33 875.00
Clare Bridge of Oviedo (I) &
WovenHearts of Oviedo (II) & (III) 11,100.00 1,483.25
Xxxxxxxx House of Portage &
Wynwood of Portage 11,083.33 1,557.58
Wynwood of Xxxxx (I) 3,333.33 949.33
Clare Bridge of Sun City West 5,600.00 708.25
Clare Bridge of Eagan 5,600.00 708.25
Sterling House of Xxxxxxx (II) 3,000.00 2,500.00
Sterling House of Maryville 2,979.17 550.00
Sterling House of Littleton 3,800.00 925.00
Sterling Cottage of Goodlettsville 2,979.17 550.00
Sterling House of Cape Coral 3,000.00 2,500.00
----------- ----------
Total $100,967.75 Total $20,937.41
DOING BUSINESS AS NAMES
Alterra Clare Bridge of Sun City West on Xxxxxx
Alterra Sterling House of Littleton
Alterra Sterling House of Xxxxxxx
Alterra Sterling House of Cape Coral
Alterra Clare Bridge of Oviedo
Alterra Sterling House of Oviedo II
Alterra Sterling House of Oviedo
Alterra Sterling House of South Bend
Alterra Sterling House of Battle Creek
Alterra Clare Bridge Cottage of Battle Creek
Alterra Sterling House of Xxx Xxxx
Xxxxxxx Xxxxx Xxxxxx Xxxxxxx xx Xxx Xxxx
33
Alterra Clare Bridge Cottage of Midland
Alterra Sterling House of Midland
Alterra Sterling House of Monroe
Alterra Clare Bridge Cottage of Monroe
Alterra Wynwood of Portage
Alterra Clare Bridge of Portage
Alterra Sterling House of Saginaw
Alterra Clare Bridge Cottage of Saginaw
Alterra Sterling House of Xxxxxx Creek
Alterra Clare Bridge Cottage of Westland
Alterra Sterling House of Westland
Alterra Sterling House of Xxxx Rapids
Alterra Clare Bridge Cottage of Xxxx Rapids
Alterra Clare Bridge of Eagan
Alterra Clare Bridge Cottage of West St. Xxxx
Alterra Sterling House of West St. Xxxx
Alterra Clare Bridge of Cheswick
Alterra Clare Bridge of Murrysville
Alterra Wynwood of Xxxxx
Alterra Sterling House of Penn Hills
Alterra Sterling House on Park Lane
Alterra Sterling House of Rock Hill
Alterra Sterling House of Goodlettsville
Alterra Sterling House of Maryville
34
EXHIBIT C
OPERATORS LEASING PROPERTY FROM BORROWER
PROPERTY OPERATOR/LESSEE
-------------------------------- -------------------------
Alterra Clare Bridge of Cheswick ALS-Indiana (PA) Partners
Alterra Wynwood of Xxxxx Wynwood of Xxxxx X.X.
