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EXHIBIT 10.33
RECORDED AT THE REQUEST OF AND AFTER RECORDING RETURN TO:
XXXXXXX X. XXXXX
JOHNSTON, BARTON, XXXXXXX & XXXXXX
0000 XXXXX XXXXXX XXXXX
0000 XXXXXXX/XXXXXXX XXXXX
XXXXXXXXXX, XXXXXXX 00000
(000) 000-0000
FORM OF MORTGAGE, SECURITY AGREEMENT AND FIXTURE FILING
THIS MORTGAGE, SECURITY AGREEMENT AND FIXTURE FILING (this
"Mortgage"), made as of the , between
, a Delaware corporation, (the "Borrower"), whose address is
0000 Xxxxxx Xxxxx, Xxxxx 000, Xxxxxxxxxxxxx, Xxxxxxxxxxxx 00000, and CAPSTONE
CAPITAL OF PENNSYLVANIA, INC., a Pennsylvania corporation (the "Lender"), whose
address is 0000 Xxxxx Xxxxxx Xxxxx, Xxxxx 000, Xxxxxxxxxx, Xxxxxxx, 00000.
R E C I T A L S:
A. Pursuant to that Loan Agreement of even date herewith between the
Borrower and the Lender, as the same may hereafter be amended (as so amended,
the "Loan Agreement"), Lender has agreed to make a loan to Borrower in the
aggregate principal sum of
(the "Loan"), to be evidenced by a Promissory Note of even
date herewith from the Borrower in such principal amount (said Promissory Note,
as the same may hereafter be renewed, extended or modified, being herein called
the "Note").
B. As a condition precedent to making the Loan, the Lender has
required that the Borrower execute this Mortgage as security for the Loan and
the other Loan Obligations (as hereinafter defined).
NOW THEREFORE, the undersigned, in consideration of the Loan, and to
secure the prompt payment and performance of the Loan Obligations (including
future advances), including the principal and interest under the Note which, if
not sooner paid, is due and payable in full on the Maturity Date, does hereby
mortgage, grant and convey unto the Lender, its successors and assigns, and
does hereby grant a security interest to Lender, its successors and assigns, in
the following described land, estates, buildings, improvements, personal
property, fixtures, equipment, furniture, furnishings, appliances and
appurtenances, including replacements and additions thereto, whether now owned
or hereafter acquired (which together with any additional such property
hereafter acquired by the Borrower and subject to the lien of this Mortgage, or
intended to be so, as the same may be from time to time constituted is
hereinafter sometimes referred to as the "Collateral") to wit:
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(A) All the tract(s) or parcel(s) of land located in and more
particularly described in Exhibit A attached hereto and made a part hereof (the
"Property"), the addresses for such Property being set forth on Exhibit A; and
(B) All Improvements and Equipment;
(C) All Appurtenant Rights;
(D) All Rents;
(E) All Accounts, General Intangibles, Instruments,
Inventory, Money, and (to the full extent assignable) Permits; and
(F) All Proceeds.
TO HAVE AND TO HOLD the Collateral and all parts thereof unto the
Lender, its successors and assigns forever, subject however to the terms and
conditions herein.
PROVIDED, HOWEVER, that these presents are upon the condition that, if
the Borrower shall pay to the Lender the Loan Obligations, at the times and in
the manner stipulated herein, in the Note and in the other Loan Documents, all
without any deduction or credit for taxes or other similar charges paid by the
Borrower, and shall cause all other obligated parties to keep, perform, and
observe all and singular the covenants and promises herein, in the Note and in
each of the other Loan Documents expressed to be kept, performed, and observed,
all without fraud or delay, then this Mortgage, and all the properties,
interests, and rights hereby granted, bargained, and sold shall cease,
determine, and be void, but shall otherwise remain in full force and effect.
ARTICLE I
DEFINED TERMS
1.01 Defined Terms. As used herein, defined terms shall have the
meanings ascribed to them, and, in addition, the following terms will have the
following meanings:
"ACCOUNTS" shall mean all accounts, (including accounts receivable)
arising from the operation of the Facility, including but not limited to,
rights to payment for goods sold or leased or for services rendered, not
evidenced by an instrument, and specifically including rights to payment from
reimbursement contracts.
"APPURTENANT RIGHTS" means all easements, rights-of-way, strips and
gores of land, vaults, streets, ways, alleys, passages, sewer rights, waters,
water courses, water rights and powers, minerals, flowers, shrubs, crops,
trees, timber and other emblements now or hereafter appurtenant to, or used or
useful in connection with or located, under or above the
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Property, or any part or parcel thereof, and all ground leases, estates, rights,
titles, interests, privileges, liberties, tenements, hereditaments and
appurtenances, reversions, and remainders whatsoever, in any way belonging,
relating or pertaining to the Property or any other Collateral, or any part
thereof.
"COLLATERAL" has the meaning set forth in the Recitals to this
Agreement.
"FACILITY" means the personal care facility presently known as and
sometimes referred to herein as located on the
Property.
"GENERAL INTANGIBLES" mean all general intangibles and other
intangible personal property arising out of or connected with the Property or
the Facility (other than accounts, rents, instruments, inventory, money and
permits), including, without limitation things in action contract rights and
other rights to payment of money.
"IMPROVEMENTS" shall mean the personal care facility, related
equipment and improvements situated on the Property.
"INSTRUMENTS" means all instruments, chattel paper, documents or other
writings obtained by Borrower from or in connection with the operation of the
Property or the Facility (including, without limitation all ledger sheets,
computer records and printouts, data bases, programs, books of account and
files relating thereto).
"INVENTORY" shall mean all goods, merchandise and other personal
property of a Person that are held for sale or lease or furnished or to be
furnished under a contract for services or raw materials and materials used or
consumed or to be used or consumed in a Person's business, and in addition
includes all property included in the definition of "inventory" as used in the
Code.
"LOAN" has the meaning set forth in the Recitals to this Mortgage.
"LOAN AGREEMENT" has the meaning set forth in the Recitals to this
Mortgage.
"LOAN DOCUMENTS" means, collectively, the Note, the Loan Agreement,
this Mortgage, the Assignment, the Assignment of Rents, the Guaranty, the
Indemnity Agreement, the Cross-Collateralization Agreement, the Subordination
Agreement, and any and all other documents executed by the Borrower or others
evidencing, securing or otherwise relating to the Loan.
"LOAN OBLIGATIONS" means the aggregate of all principal and interest
owing from time to time under the Note and all expenses, charges and other
amounts from time to time owing under the Note, the Loan Agreement, this
Mortgage or any other Loan Documents, including future advances pursuant to the
Loan Documents, and all covenants, agreements and other obligations from time
to time owing to, or for the benefit of, Lender pursuant to the Loan Documents.
"MATURITY DATE" has the meaning set forth in the Loan Agreement.
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"MONEY" means all monies, cash, rights to deposit or savings accounts
or other items of legal tender obtained from or for use in connection with the
operation of the Facility.
"NOTE" has the meaning set forth in the Recitals to this Mortgage.
"PERMITS" means all licenses, permits and certificates used or useful
in connection with the ownership, operation, use or occupancy of the Property
or the Facility, including, without limitation, business licenses, state health
department licenses, food service licenses, licenses to conduct business,
certificates of need and all such other permits, licenses and rights, obtained
from any governmental, quasi-governmental or private person or entity
whatsoever concerning ownership, operation, use or occupancy.
"PERMITTED ENCUMBRANCES" means all matters set forth in Exhibit B
attached hereto and made a part hereof, provided that to the extent any of the
same are listed as subordinate, such matters are permitted only so long as they
are in fact subordinate to this Mortgage.
"PROCEEDS" means all proceeds (including proceeds of insurance and
condemnation) from the sale, exchange, transfer, collection, loss, damage,
disposition, substitution or replacement of any of the Collateral.
"PROPERTY" has the meaning set forth in the Recitals to this Mortgage.
"REIMBURSEMENT CONTRACTS" shall mean all contracts and rights pursuant
to reimbursement or third party payor programs and contracts for the Facility
which are now or hereafter in effect with respect to patients qualifying for
coverage under the same, including Medicare, Medicaid and private insurance
agreements, and any successor program or other similar reimbursement program
and private insurance agreements.
"RENTS" means all rent and other payments of whatever nature from time
to time payable pursuant to leases of the Property or the Facility, or any part
thereof, including but not limited to, leases of retail space or other space at
the Property for retail businesses such as newsstands, barbershops, beauty
shops, physicians' offices, pharmacies and specialty shops.
1.02 Singular and Plural. Singular terms shall include the plural
forms and vice versa, as applicable of the terms defined.
1.03 References. All references to other documents or instruments
shall be deemed to refer to such documents or instruments as they may hereafter
be extended, renewed, modified or amended, and all replacements and
substitutions therefor.
1.04 Loan Agreement. All other capitalized terms not otherwise defined
in this Mortgage shall have the meanings set forth in the Loan Agreement.
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ARTICLE II
COVENANTS, AGREEMENTS, AND REPRESENTATIONS OF BORROWER
2.01 Performance of Loan Documents. The Borrower will perform,
observe, and comply with all provisions hereof and of each of the other Loan
Documents and duly and punctually will pay to the Lender the sum of money
expressed in the Note with interest thereon and all other sums required to be
paid by the Borrower pursuant to the provisions of this Mortgage, all without
any deductions or credit for taxes or other similar charges paid by the
Borrower. The Note provides for interest at a fluctuating rate, and such
provisions of the Note are incorporated herein by reference.
2.02 Warranty of Title. The Borrower is lawfully seized of an
indefeasible estate in fee simple in the Property, Improvements, Rents and
Appurtenant Rights hereby mortgaged and has good and absolute title to all
other Collateral in which a security interest is herein granted and has good
right, full power and lawful authority to sell, convey, mortgage, and grant a
security interest in the same in the manner and form aforesaid; that, except
for Permitted Encumbrances the same are free and clear of all liens, charges,
and encumbrances whatsoever, including, as to the Equipment, conditional sales
contracts, chattel mortgages, security agreements, financing statements, and
anything of a similar nature, and that Borrower shall and will warrant and
forever defend the title thereto unto the Lender, its successors and assigns,
against the lawful claims of all persons whomsoever.
2.03 Taxes, Liens and Other Charges.
(a) Borrower shall pay, on or before the delinquency date
thereof, all taxes, levies, license fees, permit fees and all other charges (in
each case whether general or special, ordinary or extraordinary, or foreseen or
unforeseen) of every character whatsoever (including all penalties and interest
thereon) now or hereafter levied, assessed, confirmed or imposed on, or in
respect of, or which may be alien upon the Collateral, or any part thereof, or
any estate, right or interest therein, or upon the rents, issues, income or
profits thereof, and shall submit to Lender upon Lender's reasonable request
such evidence of the due and punctual payment of all such taxes, assessments
and other fees and charges as may be required by law. Borrower shall have the
right before they become delinquent to contest or object to the amount or
validity of any such tax, assessment, fee or charge by appropriate legal
proceedings, but this shall not be deemed or construed in any way as relieving,
modifying or extending Borrower's covenant to pay any such tax, assessment, fee
or charge at the time and in the manner provided herein, unless Borrower has
given prior written notice to Lender of Borrower's intent to so contest or
object, and unless (i) Borrower shall demonstrate to Lender's satisfaction that
the legal proceedings shall conclusively operate to prevent the sale of the
Collateral, or any part thereof, to satisfy such tax, assessment, fee or charge
prior to final determination of such proceedings and shall not have a material
adverse effect on the operation of the Facility during the pendency of such
contest; and (ii) if required by Lender, Borrower shall furnish a good and
sufficient bond or surety as requested by and satisfactory to Lender in an
amount sufficient to fully pay the contested amount, with penalties, interest
and other charges if Borrower should be unsuccessful in such contest; and (iii)
Borrower shall diligently pursue such contest.
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(b) Borrower shall pay, on or before the due date thereof,
all taxes, assessments, charges, expenses, costs and fees, if any, which may
now or hereafter be levied upon, or assessed or charged against the Note, this
Mortgage or any other Loan Documents.
(c) Borrower shall pay, on or before the due date thereof,
all premiums on policies of insurance covering, affecting or relating to the
Collateral, as required by the Loan Agreement; and all utility charges which
are incurred by Borrower for the benefit of the Collateral, or which may become
a charge or lien against the Collateral for gas, electricity, water and sewer
services and the like furnished to the Collateral, and all other public or
private assessments or charges of a similar nature affecting the Collateral or
any portion thereof, whether or not the nonpayment of same may result in a lien
thereon. Borrower shall submit to Lender such evidence of the due and punctual
payment of all such premiums, rentals, and other sums as Lender may reasonably
require.
(d) Borrower shall not suffer any mechanic's, materialmen's
laborer's, statutory or other lien (except as expressly permitted by the Loan
Agreement) to be created or remain outstanding against the Collateral;
provided, however, that Borrower may contest any such lien in good faith by
appropriate legal proceedings provided the lien is bonded off and removed as an
encumbrance upon the Collateral. Lender has not consented and will not consent
to the performance of any work or the furnishing of any materials which might
be deemed to create a lien or liens superior to the lien thereof.
(e) In the event of the passage of any state, federal,
municipal or other governmental law, order, rule or regulation, subsequent to
the date hereof, in any manner changing or modifying the laws now in force
governing the taxation of mortgages or security agreements or debts secured
thereby or the manner of collecting such taxes so as to adversely affect
Lender, Borrower will pay any such tax on or before the due date thereof. If
Borrower fails to make such prompt payment or if, in the opinion of Lender, any
such state, federal, municipal, or other governmental law, order, rule or
regulation prohibits Borrower from making such payment or would penalize Lender
if Borrower makes such payment or if, in the reasonable opinion of Lender, the
making of such payment might result in the imposition of interest beyond the
maximum amount permitted by applicable law, then the entire balance of the Loan
Obligations shall, at the option of Lender, become immediately due and payable.
(f) The Borrower hereby indemnifies and holds Lender harmless
from any sales or use tax that may be imposed on the Lender by virtue of
Lender's Loan to Borrower.
2.04 Monthly Deposits. Borrower shall, upon request of Lender, deposit
with Lender, on the due date of each installment under the Note, an amount
equal to one-twelfth (1/12) of the yearly taxes and assessments and insurance
premiums as reasonably estimated by the Lender to pay such charges; said
deposits to be held and to be used by Lender to pay current taxes and
assessments, insurance premiums and other charges on the Collateral as the same
accrue and are payable. Payment from said sums for said purposes shall be made
by Lender at its discretion and may be made even though such payments will
benefit subsequent owners of the Collateral. Said deposits shall not be, nor be
deemed to be, trust funds, but
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may be, to the extent permitted by applicable law, commingled with the general
funds of Lender. If said deposits are insufficient to pay the taxes and
assessments, insurance premiums and other charges in full as the same become
payable, Borrower will deposit with Lender such additional sum or sums as may be
required in order for Lender to pay such taxes and assessments, insurance
premiums and other charges in full. Upon any Event of Default, Lender may, at
its option, apply any money in the fund relating from said deposits to the
payment of the Loan Obligations in such manner as it may elect.
2.05 Condemnation.
If all or part of the Collateral shall be damaged or taken through
condemnation (which term when used in this Mortgage shall include any damage or
taking by any governmental authority, and any transfer by private sale in lieu
thereof), either temporarily or permanently, other than a taking of a part of
the Collateral which does not in Lender's opinion materially adversely affect
access to or use of the Collateral, the value of the Collateral or the
operation of either Facility, the entire Loan Obligations secured hereby shall
at the option of the Lender become immediately due and payable (without any
prepayment penalty).
Borrower, immediately upon obtaining knowledge of any institution, or
any proposed, contemplated or threatened institution of any action or
proceedings for the taking through condemnation of the Collateral or any part
thereof, will notify Lender, and Lender is hereby authorized, at its option, to
commence, appear in and prosecute, through counsel selected by Lender, in its
own or in Borrower's name, any action or proceeding relating to any
condemnation Borrower may compromise or settle any claim for compensation so
long as no Event of Default exists and any compromise or settlement results in
a payment to Lender not less than the entire Loan Obligations. All such
compensations, awards, damages, claims, rights of action and proceeds and the
right thereto are hereby assigned by Borrower to Lender, and Lender is
authorized, at its option, to collect and receive all such compensation, awards
or damages and to give proper receipts and acquittance therefor without any
obligation to question the amount of any such compensation, awards or damages.
After deducting from said condemnation proceeds all of its reasonable
expenses incurred in the collection and administration of such sums, including
reasonable attorney's fees, Lender may release any moneys so received by it for
the repair or restoration of the Collateral taken, or may apply the same in
such manner as the Lender shall determine to reduce the Loan Obligations in
such order as Lender may elect, whether or not then due, and without affecting
this Mortgage as security for any remaining Loan Obligations, and any balance
of such moneys shall be paid to the Borrower.
2.06 Care of Collateral.
(a) Borrower will keep the Improvements in good condition and
repair, will not commit or suffer any waste and will not do or suffer to be
done anything which would or could increase the risk of fire or other hazard to
the Collateral or any other part thereof or which would or could result in the
cancellation of any insurance policy carried with respect to the Collateral.
(b) Borrower will not remove, demolish or alter the
structural character of any Improvements without the written consent of Lender,
which such consent shall not be
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unreasonably withheld, nor make or permit use of the Collateral for any purpose
other than that for which the same are now used.
(c) If the Collateral or any part thereof is damaged by fire
or any other cause to the extent that it affects the normal continuing
operating of the Facility at its occupancy immediately prior to such damage or
otherwise materially affects the value of the Collateral, Borrower will give
immediate written notice thereof to Lender.
(d) Lender or its representative is hereby authorized to
enter upon and inspect the Collateral during normal business hours. Lender
shall make reasonable efforts to provide notice to Borrower of such
inspections.
(e) Borrower will promptly comply with all present and future
laws, ordinances, rules and regulations of any governmental authority affecting
the Collateral or any part thereof.
(f) If all or any part of the Collateral shall be damaged by
fire or other casualty, Borrower will promptly restore the Collateral to the
equivalent of its original condition; and if a part of the Collateral shall be
taken or damaged through condemnation, Borrower will promptly restore, repair
or alter the remaining portions of the Collateral in a manner satisfactory to
Lender.
2.07 Further Assurances: After-Acquired Property. At any time, and
from time to time, upon request by Lender, Borrower will make, execute and
deliver or cause to be made, executed and delivered to Lender and, where
appropriate, cause to be recorded and/or filed and from time to time thereafter
to be recorded and/or refiled at such time and in such offices and places as
shall be deemed desirable by Lender (i) to perfect and protect the security
interest created or purported to be created hereby; (ii) to enable the Lender
to exercise and enforce its rights and remedies hereunder in respect of the
Collateral; or (iii) to effect otherwise the purposes of this Mortgage,
including, without limitation: (A) executing and filing such financing or
continuation statements, or amendments thereto, as may be necessary or
desirable or that the Lender may request in order to perfect and preserve the
security interest created by this Mortgage as a first and prior security
interest upon and security title in and to all of the Collateral, whether now
owned or hereafter acquired by Borrower; (B) if certificates of title are now
or hereafter issued or outstanding with respect to any of the Collateral, by
immediately causing the interest of Lender to be properly noted thereon at
Borrower's expense; and (C) furnishing to the Lender from time to time
statements and schedules further identifying and describing the Collateral and
such other reports in connection with the Collateral as the Lender may
reasonably request, all in reasonable detail. Upon any failure by Borrower so
to do, Lender may make, execute, record, file, re-record and/or refile any and
all such financing statements, continuation statements, or amendments thereto,
certificates, and documents for and in the name of Borrower, and Borrower
hereby irrevocably appoints Lender the agent and attorney-in-fact of Borrower
so to do. The lien of this Mortgage will automatically attach, without further
act, to all after-acquired property attached to and/or used in the operation of
the Collateral or any part thereof.
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2.08 Indemnity: Expenses. Borrower will pay or reimburse Lender for
all reasonable attorney's fees, costs and expenses incurred by Lender in any
suit, action, legal proceeding or dispute of any kind in which Lender is made a
party or appears as party plaintiff or defendant, affecting the Loan
Obligations, this Mortgage or the interest created herein, or the Collateral,
or any appeal thereof, including, but not limited to, any foreclosure action,
any condemnation action involving the Collateral or any action to protect the
security hereof, any bankruptcy or other insolvency proceeding commenced by or
against the Borrower, any lessee of the Collateral (or any party thereof), or
any Guarantor of any other Loan Obligations, and any such amount paid by Lender
shall be added to the Loan Obligations and shall be secured by this Mortgage.
Borrower will indemnify and hold Lender harmless from and against all claims,
damages, and expenses, including reasonable attorney's fees and court costs,
resulting from any action by a third party against Lender relating to this
Mortgage or the interest created herein, or the Collateral, including, but not
limited to, any action or proceeding claiming loss, damage or injury to person
or property, or any action or proceeding claiming a violation of any national,
state or local law, rule or regulation, including those Applicable
Environmental Laws, provided Borrower shall not be required to indemnify Lender
for matters directly and solely caused by Lender's misconduct or negligence.
Borrower acknowledges that it has undertaken the obligation to pay all
intangibles taxes and documentary taxes and similar taxes now or hereafter due
in connection with the Loan Obligations and the Loan Documents, and Borrower
agrees to indemnify and hold Lender harmless from any such taxes, and any
interest or penalties if assessed due to Borrower's failure to timely pay the
same, which the Lender may hereafter be required to pay in connection with the
Loan Obligations or Loan Documents. The agreements of this Section shall
expressly survive satisfaction of this Mortgage and repayment of the Loan
Obligations.
2.09 Estoppel Affidavits. Borrower, upon ten (10) days prior written
notice, shall furnish the Lender a written statement, duly acknowledged, based
upon its records, setting forth, the unpaid principal of, and interest on, the
Loan Obligations, stating whether or not to its knowledge any off-sets or
defenses exist against the Loan Obligations, or any portion thereof, and, if
such off-sets or defenses exist, stating in detail the specific facts relating
to each such off-set or defense.
2.10 Limit of Validity. If from any circumstances whatsoever,
fulfillment of any provision of this Mortgage, the Note or any other Loan
Documents, at the time performance of such provision shall be due, shall
involve transcending the limit of validity presently prescribed by any
applicable usury statute or any other applicable law, with regard to
obligations of like character and amount, then, ipso facto, the obligation to
be fulfilled shall be reduced to the limit of such validity, so that in no
event shall any exaction be possible under this Mortgage, the Note, or any
other Loan Document that is in excess of the current limit of such validity,
but such obligation shall be fulfilled to the limit of such validity. The
provisions of this Section shall control every other provision of this
Mortgage, the Note and any other Loan Document.
2.11 Assignment of Rents. This Mortgage constitutes a present
assignment to Lender of all Rents; provided, however, unless a Default or an
Event of Default exists Borrower shall have a revocable license to collect
Rents, if any. Upon the occurrence of a
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Default or an Event of Default the license of Borrower to collect Rents shall be
automatically revoked and terminated and each lessee or sublessee is authorized
and directed by Borrower to pay all Rents thereafter accruing directly to
Lender. Rents so received by Lender, unless released to Borrower at Lender's
sole option, shall be applied to the Loan Obligations in such order as Lender
may elect, whether or not then due. Lender shall not be liable to any lessee or
sublessee by virtue of its collection of Rents and shall not be liable to
Borrower for its failure to collect Rents or failure to exercise diligence in
attempting to collect Rents, but shall be accountable only for Rents actually
received. Notwithstanding anything to the contrary herein, any lease or sublease
is and shall be at all times expressly subject and subordinate to Lender's first
mortgage upon the Collateral granted herein. Upon any foreclosure or acceptance
of a deed in lieu of foreclosure, Lender may elect, at its sole option, to
foreclose or accept such deed subject to any lease or sublease, in which event
any such lessees or sublessees will, upon notice from Lender, be required to
attorn to Lender.
2.12 Legal Actions. In the event that Lender is made a party, either
voluntarily or involuntarily, in any action or proceeding affecting the
Collateral, the Note, the Loan Obligations or the validity or priority of this
Mortgage, Borrower shall immediately, upon demand, reimburse Lender for all
costs, expenses and liabilities incurred by Lender by reason of any such action
or proceeding, including reasonable attorney's fees, and any such amounts paid
by Lender shall be added to the Loan Obligations and shall be secured by this
Mortgage.
2.13 Fixture Filing. This Mortgage is to be filed for record in the
real estate records of Beaver County, Pennsylvania so as to serve as a fixture
filing pursuant to the Pennsylvania Uniform Commercial Code or the law
applicable to the creation of liens on personal property.
2.14 Lease/Management Agreements. Except as otherwise permitted in the
Loan Agreement, Borrower shall not, without the prior written consent and
approval of Lender, enter into any operating lease or permit any tenancy
(except for admissions of Facility patients) or enter into or permit any
management agreement, of or affecting the Collateral without the prior written
consent of the Lender.
ARTICLE III
EVENTS OF DEFAULT; REMEDIES
3.01 Events of Default. The terms "Event of Default" or "Events of
Default," wherever used in this Mortgage, shall mean any one or more of the
following events:
(a) The failure of the Borrower properly and timely to
perform or observe any covenant or condition set forth in this Mortgage or any
other Loan Document which is not cured within applicable cure periods as set
forth herein or therein or, if no such cure period is specified, within thirty
(30) days of Lender's notice to Borrower of such default; or
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(b) The occurrence of any Event of Default (as therein
defined) under any other Loan Documents.
(c) The sale, transfer, lease, assignment, or other
disposition, voluntarily or involuntarily, of the Collateral, or any part
thereof or any interest therein, including a sale or transfer in lieu of
condemnation, or, except for Permitted Encumbrances, any further encumbrance of
the Collateral except for any sale, transfer, lease, assignment, disposition or
encumbrance which is permitted by the Loan Agreement or, unless the prior
written consent of Lender is obtained (which consent may be withheld with or
without cause in Lender's discretion).
3.02 Acceleration of Maturity. If an Event of Default shall have
occurred, then the entire Loan Obligations shall, at the option of Lender,
become due and payable without notice or demand, time being of the essence; and
any omission on the part of Lender to exercise such option when entitled to do
so shall not be considered as a waiver of such right.
3.03 Right of Lender to Enter and Take Possession.
(a) If an Event of Default shall have occurred, the Borrower,
upon demand of the Lender, with or without judicial process, shall forthwith
surrender to the Lender the actual possession, and the Lender may enter and
take possession, of all the Mortgage Property, and may exclude the Borrower and
its agents and employees wholly therefrom.
(b) If Borrower shall for any reason fail to surrender or
deliver the Mortgage Property or any part thereof after such demand by Lender,
Lender may obtain a judgment or decree conferring upon Lender the right to
immediate possession or requiring Borrower to deliver immediate possession of
the Mortgage Property to Lender. Borrower will pay to Lender, upon demand, all
reasonable expenses of obtaining such judgment or decree, including
compensation to Lender, its attorneys and agents, and all such reasonable
expenses and compensation shall, until paid, become part of the Loan
Obligations secured by this Mortgage.
(c) Upon every such entering upon or taking of possession,
the Lender may first without applying to a court or obtaining the appointment
of receivership hold, store, use, operate, manage, lease, and control the
Mortgage Property and conduct the business thereof, and, from time to time (i)
make all necessary and proper maintenance, repairs, renewals, and replacements
thereto and thereon (including additions, betterments and improvements
reasonably necessary for the use or sale of the Mortgage Property in reasonable
amounts) and purchase or otherwise acquire additional fixtures, personalty, and
other property in connection therewith; (ii) insure or keep the Mortgage
Property insured; (iii) manage and operate the Mortgage Property and exercise
all the rights and powers of the Borrower in its name or otherwise (to the
extent permitted by applicable law), with respect to the same; (iv) enter into
any and all agreements with respect to the exercise by others of any of the
powers herein granted the Lender, all as the Lender from time to time may
determine to be to its best advantage and for the good of the Mortgage
Property; and the Lender may collect and receive all the income, revenues,
rents, issues and profits of the same including those past due as well as those
accruing thereafter, and, after deducting (A) all reasonable expenses of
taking, holding, managing, and operating the Mortgage Property (including
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compensation for the services of all persons employed for such purposes); (B)
the cost of all such maintenance, repairs, renewals, replacements, additions,
betterments, improvements, purchases, and acquisitions; (C) the cost of such
insurance; (D) such taxes, assessments, and other charges prior to the lien of
this Mortgage as the Lender may determine to pay; (E) other proper charges upon
the Mortgage Property or any part thereof; and (F) the compensation, expenses,
and disbursements of the attorneys and agents of the Lender; Lender shall apply
the remainder of the moneys so received by the Lender to the payment of accrued
interest, to the payment of tax and insurance, and to the payment of overdue
installments of principal, all in such order and priority as the Lender may
determine.
(d) If an Event of Default shall exist, Lender may require
that Borrower cause all of its Accounts to be paid to one or more deposit
accounts with a financial institution approved by Lender. Borrower assigns and
grants to Lender a security interest in, pledge of and right to set off against
all monies from time to time held in such deposit accounts. Borrower agrees to
promptly notify all of its account debtors, including, without limit, the
Medicare and Medicaid agencies to the extent permitted under applicable law, to
make payments to one or more such deposit accounts upon Lender's request and as
designated by Lender, and Borrower agrees to provide any necessary endorsements
to checks, drafts and other forms of payment so that such payments will be
properly deposited in such accounts. Lender may require that the deposit
accounts be established so as to comply with Medicare, Medicaid and other
requirements applicable to payments of any accounts receivable. Lender may
cause monies to be withdrawn from such deposit accounts and applied to the Loan
Obligations in such order as Lender may elect, whether or not then due.
Borrower appoints Lender as Borrower's attorney-in-fact, which appointment is
coupled with an interest and is irrevocable, to provide any notice, endorse any
check, draft or other payment for deposit, or take any other action which
Borrower agrees to take in this Section.
(e) Whenever all such Events of Default have been cured and
satisfied, the Lender may, at its option, surrender possession of the Mortgage
Property to the Borrower, its successors or assigns. The same right of taking
possession, however, shall exist if any subsequent Event of Default shall
occur.
3.04 Performance by Lender. Upon the occurrence of an Event of Default
in the payment, performance or observance of any term, covenant or condition of
this Mortgage or any of the other Loan Documents, Lender may, at its option,
pay, perform or observe the same, and all payments made or costs or expenses
incurred by Lender in connection therewith, with interest thereon at the
Default Rate set forth in Loan Agreement or at the maximum rate from time to
time allowed by applicable law, whichever is less, shall be secured hereby and
shall be, without demand, immediately repaid by Borrower to Lender. Lender
shall be the sole judge of the necessity for any such actions and of the
amounts to be paid. Lender is hereby empowered to enter and to authorize others
to enter upon the Collateral or any part thereof for the purpose of performing
or observing any such defaulted term, covenant or condition without thereby
becoming liable to Borrower or any person in possession holding under Borrower.
Notwithstanding anything to the contrary herein, Lender shall have no
obligation, explicit or implied to pay, perform, or observe any term, covenant,
or condition.
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3.05 Receiver.
(a) If any Event of Default shall have occurred and be continuing,
Lender shall be entitled, as a matter of absolute right and without regard to
the value of any security for the Loan Obligations or the solvency of any
person liable therefor, to the appointment of a receiver for the Collateral
upon ex parte application to any court of competent jurisdiction. Except for
notices, if any, expressly required under Pennsylvania law, Borrower waives any
right to any hearing or notice of hearing prior to the appointment of a
receiver. Such receiver and his agents shall be empowered (a) to take
possession of the Collateral and any businesses conducted by Borrower or any
other person thereon and any business assets used in connection therewith, (b)
to exclude Borrower and Borrower's agents, servants, and employees from the
Collateral, (c) to collect the rents, issues, profits, and income therefrom,
(d) to complete any construction which may be in progress, (e) to do such
maintenance and make such repairs and alterations as the receiver deems
necessary, (f) to use all stores of materials, supplies, and maintenance
equipment on the and replace such items at the expense of the receivership
estate, (g) to pay all taxes and assessments against the Collateral and the
chattels, all premiums for insurance thereon, all utility and other operating
expenses, and all sums due under any prior or subsequent encumbrance, and (h)
generally to do anything which Borrower could legally do if Borrower were in
possession of the Collateral. All expenses incurred by the receiver or his
agents shall constitute a part of the Loan Obligations. Any revenues collected
by the receiver shall be applied first to the expenses of the receivership,
including attorneys' fees incurred by the receiver and by Borrower, together
with interest thereon at the Default Rate from the date incurred until repaid,
and the balance shall be applied toward the Loan Obligations or in such other
manner as the court may direct. Unless sooner terminated with the express
consent of Borrower, any such receivership will continue until the Loan
Obligations has been discharged in full, or until title to the Collateral has
passed after foreclosure sale and all applicable periods of redemption have
expired.
3.06 Lender's Power of Enforcement.
(a) If an Event of Default shall have occurred and be continuing, the
Lender may, either with or without entry or taking possession as hereinabove
provided or otherwise, proceed by suit or suits at law or in equity or any
other appropriate proceeding or remedy (i) to enforce payment of the Note or
the performance of any term thereof or any other right, (ii) to foreclose this
Mortgage and to sell, as an entirety or in separate lots or parcels, the
Collateral, as provided by applicable Pennsylvania law, and (iii) to pursue any
other remedy available to it, all as the Lender shall deem most effectual for
such purposes. The Lender shall take action either by such proceedings or by
the exercise of its powers with respect to entry or taking possession, as the
Lender may determine.
(b) If an Event of Default shall exist, Lender may elect to terminate
the Management Agreement and all management rights and other rights of Manager
in and to any Collateral.
3.07 Foreclosure. At the foreclosure sale the Collateral may be
offered for sale and sold as a whole without first offering it in any other
manner or may be offered for sale and sold in any other manner Lender may
elect.
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3.08 Purchase by Lender. Upon any foreclosure sale or sale of all or
any portion of the Collateral under the power herein granted, Lender may bid
for and purchase the Collateral, or any part thereof if the highest bidder
therefor, and shall be entitled to apply all or any part, of the Loan
Obligations as a credit to the purchase price.
3.09 Application of Foreclosure Proceeds; Deficiency. The proceeds
of any foreclosure sale shall be applied as follows:
(a) First, to the expenses of making the sale, including reasonable
attorney's fees for such services as may be necessary in collection of said
indebtedness or the foreclosure of this Mortgage;
(b) Second, to the repayment of any money, with interest thereon at a
rate equal to the Default Rate as set forth in the Loan Agreement, which Lender
may have paid, or become liable to pay, or which it may then be necessary to
pay for taxes, insurance, assessments or other charges, liens, or debts as
hereinabove provided;
(c) Third, to the payment and satisfaction of all other Loan
Obligations hereby secured, including principal and interest on the Note (which
shall include interest to date of sale);
(d) Fourth, the balance, if any, shall be paid to the party or parties
appearing of record to be the owner of the Collateral at the time of the sale
after deducting any expense of ascertaining who is such owner.
Borrower shall remain liable for any deficiency from a foreclosure.
3.10 Waiver of Exemption, Etc. Borrower waives all rights of exemption
pertaining to real or personal property as to any indebtedness secured by or
that may be secured by this Mortgage; Borrower waives the benefit of any
statute regulating the obtaining of a deficiency judgment or requiring that the
value of the Collateral be set off against any part of the indebtedness secured
hereby; and Borrower waives and releases all errors in any proceedings for
enforcement of this Deed of Trust or other Loan Documents, waives stay of
execution, the right of inquisition and extension of time for payment, and
Borrower agrees to condemnation of any property levied on by virtue of
execution pursuant to this Mortgage. Borrower waives and relinquishes any and
all rights it may have, whether at law or equity, to require Lender to proceed
to enforce or exercise any rights, powers and remedies it may have under the
Loan Documents in any particular manner, in any particular order, or in any
particular state or other jurisdiction, it being acknowledged that the
Collateral may constitute only a part of the Collateral and Borrower
acknowledges Lender may proceed against the Collateral prior to, subsequent to
or simultaneously with pursuing any action against or with respect to other
Collateral or against the Borrower or any guarantor. To the fullest extent that
Borrower may do so, Borrower agrees that Borrower will not at any time insist
upon, plead, claim, or take the benefit or advantage of any law now or
hereafter in force providing for any valuation, appraisement, stay of execution
or extension, and Borrower, for Borrower, its successors and assigns, and for
any and all persons ever claiming any interest in the Collateral, to the extent
permitted by law, hereby waives and releases all rights of valuation,
appraisement, marshaling, stay of execution, and
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extension. Borrower further agrees that if any law referred to in this paragraph
and now in force of which Borrower, its successors and assigns or other person
might take advantage despite this paragraph, shall hereafter be repealed or
cease to be in force, such law shall not thereafter be deemed to preclude the
application of this paragraph. Borrower expressly waives and relinquishes any
and all rights and remedies that Borrower may have or be able to assert by
reason of the laws of the state of jurisdiction pertaining to the rights and
remedies of sureties, other than receipt of any notice of default required to be
given under any of the Loan Documents.
3.11 Suits to Protect the Collateral. The Lender shall have power (a)
to institute and maintain such suits and proceedings as it may deem expedient
to prevent any impairment of the Collateral by any acts which may be unlawful
or any violation of this Mortgage; (b) to preserve or protect its interest in
the Collateral and in the income, revenues, rents, profits arising therefrom;
and (c) to restrain the enforcement of or compliance with any legislation or
other governmental enactment, rule or order that may be unconstitutional or
otherwise invalid, if the enforcement of or compliance with such enactment,
rule or order would impair the security hereunder or be prejudicial to the
interest of the Lender.
3.12 Borrower to Pay the Note on Any Event of Default; Application of
Moneys by Lender. If an Event of Default (as defined in the Loan Agreement)
shall exist, then, upon demand of the Lender, the Borrower will pay to the
Lender the whole amount due and payable under the Note; and in case the
Borrower shall fail to pay the same forthwith upon such demand, the Lender
shall be entitled to xxx for and to recover judgment for the whole amount so
due and unpaid together with costs, which shall include the reasonable
compensation, expenses, and disbursements of the Lender's agents and attorneys.
3.13 Delay or Omission No Waiver. No delay or omission of the Lender
or of any holder of the Note to exercise any right, power, or remedy accruing
upon any default shall exhaust or impair any such right, power, or remedy or
shall be construed to be a waiver of any such default, or acquiescence therein;
and every right, power, and remedy given by this Mortgage to the Lender may be
exercised from time to time and as often as may be deemed expedient by the
Lender.
3.14 No Waiver of One Default to Affect Another, etc. No waiver of any
default hereunder shall extend to or shall affect any subsequent or any other
then existing default or shall impair any rights, powers, or remedies
consequent thereon.
If the Lender (a) grants forbearance or an extension of time for the
payment of any sums secured hereby; (b) takes other or additional security for
the payment thereof; (c) waives or does not exercise any right granted herein
or in the Note; (d) releases any part of the Collateral from the lien of this
Mortgage or otherwise changes any of the terms of the Note or this Mortgage;
(e) consents to the filing of any map, plat, or replat thereof; (f) consents to
the granting of any easement thereon; or (g) makes or consents to any agreement
subordinating the lien or change hereof, any such act or omission shall not
release, discharge, modify, change, or affect the original liability under the
Note, this Mortgage or otherwise of the Borrower or any subsequent purchaser of
the Collateral or any part thereof, or any maker, co-signer, endorser, surety,
or guarantor; nor shall any such act or omission preclude the Lender from
exercising any right, power, or privilege herein granted or
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intended to be granted in the event of any other default then made or of any
subsequent default, nor, except as otherwise expressly provided in an instrument
or instruments executed by the Lender, shall the lien of this Mortgage be
altered thereby. In the event of the sale or transfer by operation of law or
otherwise of all or any part of the Collateral, the Lender, at its option,
without notice to any person or corporation hereby is authorized and empowered
to deal with any such vendee or transferee with reference to the Collateral or
the indebtedness secured hereby, or with reference to any of the terms or
conditions hereof, as fully and to the same extent as it might deal with the
original parties hereto and without in any way releasing or discharging any of
the liabilities or undertakings hereunder.
3.15 Continuance of Proceedings - Position of Parties, Restored. In
case Lender shall have proceeded to enforce any right or remedy under this
Mortgage by foreclosure, entry or otherwise, and such proceedings shall have
been discontinued or abandoned for any reason, or shall have been determined
adversely to Lender, then and in every such case, Borrower and Lender shall be
restored to their former positions and rights hereunder, and all rights, powers
and remedies of Lender shall continue as if no such proceedings had occurred.
3.16 Remedies Cumulative. No right, power, or remedy conferred upon or
reserved to the Lender by this Mortgage is intended to be exclusive of any
right, power, or remedy, but each and every such right, power, and remedy shall
be cumulative and concurrent and shall be in addition to any other right,
power, and remedy given hereunder or now or hereafter existing at law or in
equity or by statute.
ARTICLE IV
SECURITY AGREEMENT: MISCELLANEOUS
4.01 Security Agreement. This Mortgage creates a lien on and a
security interest in that part of the Collateral which constitutes personal
property under any applicable Uniform Commercial Code, and shall constitute a
security agreement under the applicable Uniform Commercial Code or other law
applicable to the creation of liens on personal property. This Mortgage shall
constitute a financing statement under the applicable Uniform Commercial Code
with Borrower as the "debtor" and Lender as the "secured party." If an Event of
Default occurs, the Lender shall have all rights and remedies of a security
party under the applicable Uniform Commercial Code.
4.02 Assembly of Collateral. Upon the occurrence of an Event of
Default, the Borrower shall assemble, if requested by the Lender, at its
expense, all of the personal property Collateral and the documents evidencing
such personal property Collateral and the books and records applicable thereto
and make them available to the Lender at a place to be designated by the
Lender.
4.03 Successors and Assigns. This Mortgage shall inure to the benefit
of and be binding upon Borrower and Lender and their respective heirs,
executors, legal representatives, successors, successors-in-title, and assigns.
Whenever a reference is made in this Mortgage to "Borrower" or "Lender," such
reference shall be deemed to include a reference to the heirs, executors, legal
representatives, successors, successors-in-title and
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assigns of Borrower or Lender, as the case may be, but shall not imply any
permission to make or permit any transfer which is otherwise prohibited.
4.04 Terminology. All personal pronouns used in this Mortgage, whether
used in the masculine, feminine or neuter gender, shall include all other
genders; the singular shall include the plural, and vice versa. Titles and
Articles are for convenience only and neither limit nor amplify the provisions
of this Mortgage, and all references herein to Articles, Sections or
subparagraphs shall refer to the corresponding Articles, Sections or
subparagraphs of this Mortgage unless specific reference is made to Articles,
Sections or subparagraphs of another document or instrument.
4.05 Severability; Complete Agreement. If any provisions of this
Mortgage or the application thereof to any person or circumstance shall be
invalid or unenforceable to any extent, the remainder of this Mortgage and the
application of such provisions to other persons or circumstances shall not be
affected thereby and shall be enforced to the greatest extent permitted by law.
This Mortgage, the Note and the other Loan Documents constitute the full and
complete agreement of the parties and supersede all prior negotiations,
correspondence, and memoranda relating to the subject matter hereof, and this
Mortgage may not be amended except by a writing signed by the parties hereto.
4.06 Applicable Law. This Mortgage shall be governed by the laws of
the State of Pennsylvania. If, for any reason or to any extent any word, term,
provision, or clause of this Mortgage or any of the other Loan Documents, or
its application to any person or situation, shall be found by a court or other
adjudicating authority to be invalid or unenforceable, the remaining words,
terms, provisions or clauses shall be enforced, and the affected work, term,
clause or provision shall be applied, to the fullest extent permitted by law.
4.07 Limitation of Interest. It is the intent of Borrower and Lender
in the execution of this Mortgage and all other Loan Documents to contract in
strict compliance with the usury laws governing the Loan. In furtherance
thereof, Lender and Borrower stipulate and agree that none of the terms and
provisions contained in the Loan Documents shall ever be construed to create a
contract for the use, forbearance, or detention of money requiring payment of
interest at a rate in excess of the maximum interest rate permitted to be
charged by the laws governing the Loan. Borrower or any guarantor, endorser or
other party now or hereafter becoming liable for the payment of the Note shall
never be liable for unearned interest on the Note and shall never be required
to pay interest on the Note at a rate in excess of the maximum interest that
may be lawfully charged under the laws governing the Loan evidenced by the
Note, and the provisions of this paragraph shall control over all other
provisions of the Note and any other instrument executed in connection herewith
which may be in apparent conflict herewith. In the event any holder of the Note
shall collect monies that are deemed to constitute interest and that would
otherwise increase the effective interest rate on the Note to a rate in excess
of that permitted to be charged by the laws governing the Loan evidenced by the
Note, all such sums deemed to constitute interest in excess of the legal rate
shall be applied to the unpaid principal balance of the Note and if in excess
of such balance, shall be immediately returned to the Borrower upon such
determination.
4.08 Notices, etc. Any notice and other communication required or
permitted to be given by this Mortgage or the other Loan Documents or by
applicable law shall be in writing
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and provided for hereunder shall be deemed given and received in accordance with
the provisions of the Loan Agreement.
4.09 Replacement of Note. Upon receipt of evidence reasonably
satisfactory to Borrower of the loss, theft, destruction or mutilation of the
Note, and in the case of any such loss, theft or destruction, upon delivery of
an indemnity agreement reasonably satisfactory to Borrower or, in the case of
any such mutilation, upon surrender and cancellation of the Note, Borrower at
Lender's expense will execute and deliver, in lieu thereof, a replacement note,
identical in form and substance to such Note and dated as of the date of such
Note, and upon such execution and delivery all references in this Mortgage to
the Note shall be deemed to refer to such replacement note.
4.10 Assignment. This Mortgage is assignable by Lender and any
assignment hereof by Lender shall operate to vest in the assignee all rights
and powers herein conferred upon and granted to Lender.
4.11 Time of the Essence. Time is of the essence with respect to each
and every covenant, agreement and obligation of Borrower under this Mortgage,
the Note and all other Loan Documents.
4.12 Release. Provided that no Event of Default then exists, Lender
agrees to release this Mortgage upon payment and performance in full of all
Loan Obligations.
4.13 Counterparts. This Mortgage may be executed in any number of
counterparts, each of which, when executed and delivered, shall be an original,
but such counterparts shall together constitute one and the same instrument.
4.14 Waiver of Jury Trial. BORROWER, BY ACCEPTANCE OF THIS AGREEMENT,
HEREBY WAIVES ANY RIGHT THAT IT MAY HAVE TO A TRIAL BY JURY ON ANY CLAIM,
COUNTERCLAIM, SETOFF, DEMAND, ACTION OR CAUSE OF ACTION (A) ARISING OUT OF OR
IN ANY WAY RELATED TO THIS AGREEMENT OR THE LOAN, OR (B) IN ANY WAY CONNECTED
WITH OR PERTAINING OR RELATING TO OR INCIDENTAL TO ANY DEALINGS OF LENDER
AND/OR BORROWER WITH RESPECT TO THE LOAN DOCUMENTS, OR IN CONNECTION WITH THIS
DEED OR TRUST, OR THE EXERCISE OF EITHER PARTY'S RIGHTS AND REMEDIES UNDER THIS
AGREEMENT, OR OTHERWISE, OR THE CONDUCT OF THE RELATIONSHIP OF THE PARTIES
HERETO, IN ALL OF THE FOREGOING CASES WHETHER NOW EXISTING OR HEREAFTER ARISING
AND WHETHER SOUNDING IN CONTRACT, TORT OR OTHERWISE. BORROWER AGREES THAT
LENDER MAY FILE A COPY OF THIS AGREEMENT WITH ANY COURT AS WRITTEN EVIDENCE OF
THE KNOWING, VOLUNTARY, AND BARGAINED AGREEMENT OF THE BORROWER IRREVOCABLY TO
WAIVE ANY RIGHTS TO A TRIAL BY JURY AS AN INDUCEMENT OF LENDER TO MAKE THE
LOAN, AND THAT, TO THE EXTENT PERMITTED BY APPLICABLE LAW, ANY DISPUTE OR
CONTROVERSY WHATSOEVER BETWEEN BORROWER AND LENDER INSTEAD BE TRIED IN A COURT
OF COMPETENT JURISDICTION BY A JUDGE SITTING WITHOUT A JURY.
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[SIGNATURES ON FOLLOWING PAGE]
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IN WITNESS WHEREOF, the Borrower has caused this Mortgage to be
executed and delivered as of the day and year first above written.
BY: /s/ XXXXX X. XXXXX
--------------------------
XXXXX X. XXXXX, VICE PRESIDENT
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SCHEDULE TO EXHIBIT 10.33 FILED PURSUANT TO INSTRUCTION 2 OF ITEM 601(a) OF
REGULATION S-K
MORTGAGE, SECURITY AGREEMENT AND FIXTURE FILING
-----------------------------------------------
PROJECT PARTIES FACILITY LOAN AMOUNT DATE
------- ------- -------- ----------- ----
Darlington, PA BCC at Darlington, Inc. (Borrower), Xxxxxxx Personal Care $5,875,000.00 9/30/97
and Capstone Capital of Pennsylvania, Home
Inc. (Lender)
Butler, PA Balanced Care at Butler, Inc. Silver Haven $246,000.00 10/31/97
(Borrower) and Capstone Capital of
Pennsylvania, Inc. (Lender)
Sarver, PA Balanced Care at Sarver, Inc. Sterling Care of Sarver $286,000.00 10/31/97
(Borrower) and Capstone Capital of
Pennsylvania, Inc. (Lender)
Saxonburg, PA Balanced Care at Saxonburg, Inc. Sterling Care of $8,618,000.00 10/31/97
(Borrower) and Capstone Capital of Saxonburg
Pennsylvania, Inc. (Lender)
