Exhibit A
FORM OF TERM LOAN GUARANTY AGREEMENT
GUARANTY
THIS GUARANTY (this "Guaranty") is executed and delivered on
this day of , 1998 by ______________________, a ___________ corporation
("Guarantor") with an address at ______________________________, in favor of
ELDERTRUST OPERATING LIMITED PARTNERSHIP, a Delaware limited partnership
(together with its successors and assigns, "Lender") with an address at 000
XxXxxxxx Xxxx, Xxxxx 000, Xxxxxxx Xxxxxx, Xxxxxxxxxxxx 00000, to secure certain
obligations of , a __________ corporation ("Borrower"), with an address at
_________________________________________________________________.
BACKGROUND
A. Borrower and Lender have entered into that certain Term
Loan Agreement, dated as of the date hereof (as the same may be modified,
renewed, extended, amended, supplemented and/or assigned from time to time, the
"Loan Agreement"), relating to the conversion of an existing building into a
____ unit senior assisted living facility (the "Project") on certain real estate
located in __________ Township, __________. Capitalized terms used herein
without definition shall have the meanings ascribed to such terms as in the Loan
Agreement.
B. In connection with the Loan Agreement, Borrower has
executed and delivered a Secured Note (as modified, renewed, extended, amended,
supplemented and/or assigned from time to time, the "Note"), dated as of the
date hereof, payable to the order of the Lender in the face amount of
$[_____________], a Mortgage and Security Agreement as security for the
obligations secured by the Note (as modified, renewed, extended, amended and/or
assigned from time to time, the "Mortgage"), and certain other collateral
documents identified in the Loan Agreement, all dated as of the date hereof. The
Loan Agreement, Note, Mortgage and the other collateral documents identified in
the Loan Agreement, as the same is modified, renewed, extended, amended,
supplemented and/or assigned from time to time, are sometimes collectively
referred to herein as the "Loan Documents", and individually as a "Loan
Document". The principal balance of the Note, together with all interest thereon
and all other sums payable thereunder or under the Loan Documents or secured by
the Loan Documents, is hereinafter collectively referred to as the
"Indebtedness".
C. Guarantor is an affiliate of Borrower.
D. In order to induce Lender to enter into the Loan Agreement,
Guarantor has agreed to execute and deliver this Guaranty in favor of Lender.
AGREEMENTS
In consideration of the recitals above, and for other good and
valuable consideration, and intending to be legally bound hereby, Guarantor
hereby agrees:
1. Obligations. The following guarantees and obligations
(together, the "Obligations") are undertaken by Guarantor:
(a) Guarantor hereby unconditionally and absolutely
guarantees and becomes surety to Lender for the prompt payment when due of the
Indebtedness. The obligations of Guarantor constitute a guarantee of payment and
not merely of collection, are absolute and unconditional under all circumstances
and shall not in any event be discharged, impaired, or otherwise affected except
by payment in full to Lender. Guarantor agrees that it will, within three (3)
business days after written notice from Lender that any Event of Default has
occurred under the Loan Agreement, the Note or under any other Loan Document,
pay in full directly to Lender the then existing amount of the Indebtedness.
Guarantor further agrees that any payment required hereunder will be made to
Lender regardless of whether such sums have become due by reason of the maturity
of the Note or acceleration of the Indebtedness or whether such liability
becomes barred by any statute of limitations or otherwise becomes unenforceable.
The proceeds of any amounts paid pursuant to this Guaranty will be applied first
to the payment of accrued interest, if any, on the Note, then to any other sums
payable in connection with the Note or secured by the Loan Documents, and the
balance of the proceeds will be applied to reduce the then outstanding principal
amount of the Note, whether then matured or not, in the inverse order of its
maturity.
(b) Guarantor hereby unconditionally and absolutely
guarantees and hereby agrees to be guarantor of (i) the full and timely
performance of all of Borrower's obligations under the Loan Documents. Guarantor
hereby unconditionally and absolutely guarantees that there shall be no
mechanics' liens, claims or other liens or charges filed against the Project or,
if they are so filed, Guarantor shall cause such liens to be timely removed or
satisfied of record within ten (10) days after notice thereof to Guarantor. If
Borrower defaults with respect to any matter herein guaranteed, then, within
five (5) days after written notice from Lender, Guarantor will immediately
assume all responsibility for all obligations of Borrower under the Loan
Agreement and the other Loan Documents or take such other action as Lender may
request to remedy such default, or both. If Guarantor does not fully assume such
responsibility and obligations within such five (5) day period to Lender's
satisfaction, then Lender may elect, without further notice to Guarantor, to
take any action it believes necessary to protect its interests under the Loan
Documents, but with the further right to suspend or terminate such actions at
any time. No such actions by Lender shall release or limit the liability of
Guarantor and Guarantor agrees to repay Lender all sums expended by it in
undertaking.
(c) Lender shall have the right to require Guarantor
to pay, comply with and satisfy its obligations and liabilities under this
Guaranty and shall have the right to proceed immediately against Guarantor with
respect thereto, without being required to bring any proceeding or take any
action of any kind against Borrower or any other guarantor or any other person,
entity or property (including, without limitation, the Project) prior thereto,
the liability of Guarantor hereunder being, in any event, independent of and
separate from the liability of Borrower, any other guarantors and persons and
the availability of other collateral security for the Note and the Loan
Documents.
(d) This Guaranty shall be deemed to be a continuing
guaranty of Indebtedness from Lender to Borrower and of all expenses incurred by
Lender in connection therewith.
2. Cancellation. This Guaranty and all of the Obligations will
be canceled when the Indebtedness has been irrevocably and indefeasibly paid in
full; provided, however, that this Guaranty shall remain in full force and
effect for so long as such payment may be voided in bankruptcy or other
insolvency proceedings as a preference, or for any other reason or generally set
aside as a result of any action or proceedings by creditors. If this Guaranty is
canceled pursuant to this Paragraph 2 or otherwise by Lender, Lender will,
within forty-five (45) business days thereafter, xxxx the original hereof
"Canceled" and return it to Borrower.
3. Events of Default; Costs and Fees; Indemnification.
Guarantor hereby agrees that if it does not satisfy the Obligations set forth in
Section 1 hereof in accordance with the terms thereof, the same shall be an
Event of Default hereunder. Lender shall have the right, in addition to the
other rights described in this Guaranty, to collect from Guarantor all costs,
fees and expenses (including reasonable attorneys' fees) incurred by Lender in
connection with the enforcement of this Guaranty against such Guarantor, as well
as interest on the unpaid Obligations at the Default Rate set forth in the Note,
from and after the date of such Event of Default through the date of payment. In
the event of any default hereunder, Guarantor shall indemnify and defend the
Lender against, and hold Lender harmless from, all liability, damage, cost and
expense, including, without limitation, costs of suit and attorneys' fees, which
Lender may incur by reason of such default by Guarantor.
4. Additional Remedies. Lender shall have and may exercise, in
addition to any and all rights or remedies provided herein or by law, the
specific rights and remedies, exercisable by Lender in its discretion, to xxx
for and obtain specific performance of Guarantor's covenants set forth herein,
all of which costs shall be borne by Guarantor. Lender may, at its option,
proceed to enforce this Guaranty against Guarantor without first proceeding
against Borrower or any other person and without first resorting to any security
held by Lender as security or to any other remedies, and the liability of
Guarantor hereunder shall be in no manner affected or impaired by any failure,
delay, neglect, omission or election by Lender not to realize upon or pursue any
persons liable or security for the Indebtedness or the other obligations of
Borrower under the Loan Agreement or the other Loan Documents.
5. Bankruptcy of Borrower or Guarantor. The Obligations shall
not be discharged, impaired or otherwise affected by the insolvency, bankruptcy,
liquidation, readjustment, composition, dissolution or other similar proceeding
involving or affecting Borrower or Guarantor, proceedings affecting the
ownership of either of the above through merger, consolidation or otherwise,
inconsistent orders in or claims by parties to any such proceedings or other
release of obligations by operation of law.
6. Covenants. Guarantor hereby covenants and agrees that:
(a) The Obligations shall not be released or
otherwise affected by (and hereby waives notice of) any agreement, amendment,
release, suspension, compromise, forbearance, indulgence, waiver, extension,
renewal, supplement or modification or assignment of any of the Loan Documents,
or of any obligations of Borrower to Lender;
(b) Lender may, without affecting the liability of
Guarantor under this Guaranty, (i) exchange, release or surrender any property
pledged by or on behalf of Borrower or any other guarantor of any liabilities of
Borrower to Lender, (ii) renew or change, with the consent of Borrower, the
terms of any of Borrower's liabilities to Lender, or (iii) waive any of Lender's
rights or remedies against Borrower or any other guarantor of any obligations of
Borrower, all without obtaining consent thereto from Guarantor;
(c) The Obligations shall not be reduced or affected
either by any payment made by or on behalf of any other party to the Loan
Documents or by failure of any such party to make payment;
(d) The Obligations shall be in addition to that
stated in any other guaranty of parties other than the undersigned or any other
guaranty that has been or may be hereafter given by the undersigned and shall
not be reduced or affected by any payment made under any such guaranty;
(e) Any failure or delay by Lender to exercise any
right under this Guaranty or under any other guaranty or with respect to any of
the Loan Documents or otherwise with respect to the Indebtedness shall not be
construed as a waiver of the right to exercise the same or any other right
hereunder at any time and from time to time thereafter;
(f) The Obligations shall not be affected by any of
Borrower's liabilities to Lender in excess of the amounts guaranteed hereunder,
and any payment received by Lender from Borrower may first be credited against
any such excess liability;
(g) Lender shall not, under any circumstances, be
required to exhaust remedies or proceed against Borrower, other sureties,
parties, or any other security for the Indebtedness before proceeding under this
Guaranty against the undersigned;
(h) Until all of the Obligations are indefeasibly
paid in full, under no circumstances shall Guarantor become subrogated to the
claims or liens of Lender against Borrower or any other guarantor and that all
amounts due to Lender shall have priority in right of payment over any amounts,
whether or not related to the Loan Documents or the Project, payable now or
hereafter from Borrower to Guarantor;
(i) The Obligations shall not be affected by any
provision in the Loan Documents limiting Lender's rights against Borrower to the
Project or any other Collateral, or limiting Lender's rights to a deficiency
judgment against Borrower;
(j) To the extent Guarantor controls (whether
directly or indirectly) Borrower, it will neither knowingly take or cause to be
taken any action, or permit any inaction, which will violate or cause a default
or Event of Default under any of the Loan Documents;
(k) Notice or demand hereunder by Lender shall be by
hand delivery or registered or certified mail, postage prepaid, addressed to
Guarantor at its address set forth on the first page hereof, and shall be deemed
given when hand delivered, or if mailed, upon deposit of such notice in the
United States mail;
(l) No single exercise of the power to bring any
action or institute any proceeding shall be deemed to exhaust such power, but
such power shall continue undiminished and may be exercised from time to time as
often as Lender may elect until all of Guarantor's liabilities and obligations
hereunder have been satisfied; and
(m) Without the prior written consent of Lender,
which consent shall not be unreasonably withheld, Guarantor's liability under
this Guaranty shall in no way be released or otherwise affected by any
assignment by Borrower of its rights or obligations under any Loan Document, or
by the commencement, existence or completion of any proceeding against Borrower,
or any other person or entity or otherwise with respect to the collection of the
Indebtedness; and Lender shall be under no obligation to take any action and
shall not be liable for any action taken or any failure to take action or any
delay in taking action against Guarantor, Borrower or any other person or entity
or otherwise with respect to the Indebtedness.
7. Representations and Warranties. Guarantor hereby represents
and warrants to Lender as of the date hereof and at all times when this Guaranty
shall remain in effect:
(a) Guarantor is a __________ duly formed, validly
existing and in good standing under the laws of its jurisdiction of formation.
Guarantor has the power and authority to own its own property and assets and to
transact the business in which it is engaged;
(b) Guarantor has the power and authority to execute,
deliver and perform the terms and provisions of this Guaranty and Guarantor has
taken all necessary action to authorize the execution, delivery and performance
of this Guaranty. This Guaranty constitutes the authorized, valid and legal
binding obligation of Guarantor enforceable in accordance with its terms;
(c) There are no actions, suits or proceedings
pending, or to the knowledge of Guarantor, threatened, against or affecting
Guarantor before any court or before any governmental or administrative body or
agency which, if determined adversely to Guarantor, individually or in the
aggregate, would have a material adverse effect on Guarantor's business or
properties;
(d) Guarantor is not in default under the provisions
of any agreement to which it is a party and Guarantor is not in violation of any
applicable provision of law or any applicable regulation of any governmental
department, commission, board, bureau, agency or instrumentality, the violation
of which would have a material adverse effect on Guarantor's business or
properties or the Project. Neither the execution and delivery of this Guaranty
nor the consummation of the transactions herein contemplated, nor compliance
with the terms and provisions hereof, (i) will violate any applicable provision
of law or any applicable regulation, or any order, writ, injunction or decree of
any court or governmental department, commission, board, bureau, agency or
instrumentality or (ii) will conflict or will be inconsistent with, or will
result in any breach of, any of the terms, covenants, conditions or provisions
of, or constitute a default under, or result in the creation of imposition of
(or the obligation to impose) any lien, charge or encumbrance upon any of the
property or assets of Guarantor pursuant to the terms of any indenture,
franchise, license, permit, mortgage, deed of trust, agreement or other
instrument to which Guarantor is a party or by which Guarantor may be bound, or
to which Guarantor may be subject, except as would not have a material adverse
effect;
(e) Guarantor has filed all tax returns required by
law to be filed by it and has paid all taxes, assessments and other governmental
charges levied upon it and any of it respective properties, assets, income or
franchises which are due and payable, other than those presently payable without
penalty or interest;
(f) Guarantor is in compliance with all applicable
provisions of ERISA;
(g) With respect to any financial statements
delivered by Guarantor to Lender after the date of this Guaranty, all such
financial statements shall have been prepared in accordance with generally
accepted accounting principles applied on a consistent basis throughout the
period specified and present fairly in all material respects the financial
position of Guarantor as of the date specified and the results of operations and
statements of cash flow for the period specified;
(h) Neither this Guaranty nor any other document
delivered to Lender by or on behalf of Guarantor in connection with the
transactions contemplated by the Loan Documents contain any untrue statement of
a material fact or omit to state a material fact necessary in order to make the
statements contained in this Guaranty and in such other documents, certificates
or instruments not misleading. There is no fact (other than matter of a general
economic or political nature which do not uniquely affect Guarantor) which
materially adversely affects or in the future may (so far as such Guarantor can
foresee) materially adversely affect the business, condition (financial or
otherwise), operations, properties or prospects of Guarantor which has not been
set forth in this Guaranty; and
(i) The Indebtedness is and will be of direct
benefit, interest and advantage to Guarantor.
8. Waivers.
(a) Guarantor waives (i) any notice of Lender's
intention to act in reliance of this Guaranty, (ii) diligence, presentment,
demand, protest or notice of dishonor, extension of time of payment, nonpayment
or other default with respect to the Indebtedness, and indulgences and notices
of every kind and (iii) the commencement or prosecution of any enforcement
proceeding against Borrower or any other person or entity with respect to the
Indebtedness or otherwise. Guarantor hereby consents to any and all forbearances
and extensions of time of payment of the Note, and to any and all changes in
terms, covenants, and conditions thereof or of the other Loan Documents; it
being the intention hereof that Guarantor shall remain liable as a principal
until the Indebtedness shall have been fully paid and until the terms,
covenants, and conditions of the Note and of the other Loan Documents shall have
been performed and observed by Borrower, notwithstanding any act, omission, or
thing which might otherwise operate as a legal or equitable discharge of
Guarantor.
(b) Guarantor agrees that the Obligations shall not
be impaired, modified, changed, released, or limited in any manner whatsoever by
any impairment, modification, change, release, or limitation of the liability of
Borrower or its estate in bankruptcy, resulting from the operation of any
present or future provision of the bankruptcy laws or other similar statute, or
from the decision of any court.
(c) Guarantor irrevocably waives all claims of
waiver, release, surrender, alteration or compromise and all defenses, set-offs,
counterclaims, recoupments, reductions, limitations or impairments.
(d) Guarantor waives the right to marshaling of
Borrower's assets, any stay of execution and the benefit of all exemption laws,
to the extent permitted by law, or any other protection granted by law to
guarantors, now or hereafter in effect with respect to any action or proceeding
brought by Lender against Guarantor.
9. Miscellaneous. The invalidity or unenforceability of any
one or more provisions of this Guaranty shall not affect any other provision.
This Guaranty will be governed by the law of the State of __________ (but not
including the choice of law provisions thereof) and may be amended only by a
written instrument executed by Guarantor and Lender. This Guaranty is
irrevocable. The provisions of this Guaranty will bind and inure to the benefit
of the respective successors and assigns of Guarantor and Lender. Whenever the
context requires, all terms used in the singular will be construed in the plural
and vice versa, and each gender will include the other gender.
10. Assignment. This Guaranty and the obligations of Guarantor
hereunder shall not be assigned in any respect without the prior written consent
of Lender, which consent shall not be unreasonably withheld. Lender shall have
the absolute right, without Guarantor's consent or approval, to assign in whole
or in part this Guaranty and/or the other Loan Documents to any third
party(ies).
11. JURISDICTION; TRIAL BY JURY. GUARANTOR HEREBY SUBMITS AND
CONSENTS TO THE JURISDICTION OF THE COURTS OF THE STATE OF __________ AND THE
COURTS OF THE UNITED STATES LOCATED IN THE STATE OF __________, IN ANY AND ALL
ACTIONS OR PROCEEDINGS ARISING HEREUNDER OR PURSUANT HERETO, AND IRREVOCABLY
AGREES TO SERVICE OF PROCESS BY CERTIFIED MAIL, RETURN RECEIPT REQUESTED, TO ITS
ADDRESS SET FORTH HEREIN OR SUCH OTHER ADDRESS AS GUARANTOR MAY DIRECT BY NOTICE
TO MORTGAGEE. GUARANTOR IRREVOCABLY AS AN INDEPENDENT COVENANT WAIVES A JURY
TRIAL AND THE RIGHT THERETO IN ANY ACTION OR PROCEEDING BETWEEN GUARANTOR AND
LENDER, WHETHER HEREUNDER OR OTHERWISE.
IN WITNESS WHEREOF, Guarantor has executed and delivered this
Guaranty as of the day and year first written above.
GUARANTOR:
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Witness: By:
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Name: Name:
Title: Title:
[Corporate Seal]
