PROMISSORY NOTE
Back
to 10-Q
|
$13,120,000.00
|
March
____, 2007
|
FOR
VALUE
RECEIVED, EMERI-SKY
SC LLC,
a
Delaware limited liability company, having an address at 0000 Xxxxxxx Xxxxxx,
Xxxxx 000, Xxxxxxx, Xxxxxxxxxx 00000 (the “Borrower”),
hereby
promises to pay to the order of CAPMARK
BANK, a
Utah
industrial bank, having an address at 000 Xxxxx Xxxx, X. X. Box 809, Horsham,
PA
19044, together with its successors and assigns or, if this Note has then been
endorsed “to bearer,” to the bearer of this Note (collectively the “Lender”),
at
Xxxxxx’s said address or at such other place or to such other person as may be
designated in writing to Borrower by Xxxxxx, the principal sum of Thirteen
Million One Hundred Twenty Thousand and No/100 Dollars ($13,120,000.00) (the
“Loan”),
together with interest on the unpaid balance thereof at the rate hereinafter
set
forth. Capitalized terms used herein without definition shall have the meaning
given to such terms in the Loan Agreement (defined herein).
ON
THE
TERMS AND SUBJECT TO THE CONDITIONS which are hereinafter set
forth:
Section
1. Interest
Rate.
1.1 Initial
Note Rate.
Interest shall accrue on the outstanding principal balance of the Loan from
and
after the date hereof (“Closing
Date”)
at the
rate of 8.22000% per annum (“Initial
Note Rate”).
If
the Loan is funded on a date other than the first (1st) day of a calendar month,
Borrower shall pay to Lender at the time of funding of the Loan an interest
payment calculated by multiplying (i) the number of days from and including
the
Closing Date to (and including) the last day of the current month or by (ii)
the
Initial Note Rate calculated based on a 360 day year and paid for the actual
number of days elapsed for any whole or partial month in which interest is
being
calculated.
1.2 Calculation
Basis; Interest Accrual Period.
Interest on the outstanding principal balance of the Loan shall be calculated
utilizing a 360 day year and paid for the actual number of days elapsed for
any
whole or partial month in which interest is being calculated. The interest
rate
on the outstanding principal balance hereof from time to time shall be adjusted
on the dates (each being a “Rate Adjustment Date”) described in this paragraph.
The first Rate Adjustment Date shall be April 1, 2007, and subsequent Rate
Adjustment Dates shall fall on the first day of each subsequent one month
anniversary thereafter. The first payment adjustment date shall be May 1, 2007,
and subsequent payment adjustment dates shall fall on the first day of each
calendar month thereafter during the term of the Loan. As used herein, “Interest
Accrual Period” shall mean the period beginning on the 1st
day of a
month through the end of such month.
1.3 Default
Interest Rate.
If
Borrower fails to make any payment of principal, interest or fees on the date
on
which such payment becomes due and payable whether at maturity or by
acceleration, or if an Event of Default exists, the Note Rate then payable
1
on
the
Loan shall immediately increase to the Note Rate plus five hundred (500) basis
points (the “Default
Rate”)
and
shall continue to accrue at the Default Rate until full payment of all amounts
then due is received or such Event of Default is cured or waived in writing
by
Xxxxxx. Interest at the Default Rate shall also accrue on any judgment obtained
by Xxxxxx in connection with collection of the Loan or enforcement of any
obligations due under the Loan Documents until such judgment is paid in
full.
1.4 Note
Rate and Note Rate Adjustment Dates.
The
“Note
Rate”
shall
mean an interest rate which is the average of London Interbank Offered Rates
(“LIBOR”),
in
U.S. dollar deposits, for a term of one month determined solely by Lender on
each Note Rate Adjustment Date (defined below) plus
two
hundred ninety (290) basis points (“Margin”),
which
combined figure shall be rounded upwards to the nearest one-eighth percent
(.125%). On each Note Rate Adjustment Date, Lender will obtain the
close-of-business LIBOR from “Page 3750” on the Telerate Service (or such other
page as may replace Page 3750 on that service) on the Note Rate Adjustment
Date.
If Telerate Service ceases publication or ceases to publish LIBOR, Lender shall
select a comparable publication to determine the LIBOR and provide notice
thereof to Borrower. LIBOR may or may not be the lowest rate based upon the
market for U.S. dollar deposits in the London Interbank Eurodollar Market at
which Lender prices loans on the date on which LIBOR is determined by Lender
as
set forth above. Adjustments to the Note Rate in connection with changes in
LIBOR shall be made two (2) Business Days prior to the beginning of any Interest
Accrual Period (each “Note
Rate Adjustment Date”)
except
than the Initial Note Rate shall be determined two (2) Business Days prior
to
the Closing Date.
1.5 Adjustments
due to Calculation Errors.
This
Note shall bear interest at the Initial Note Rate and Note Rate as determined
in
accordance with the provisions hereof; provided, however, that, if Lender at
any
time determines, in the sole but reasonable exercise of its discretion that
it
has miscalculated the amount of the monthly payment of principal and/or interest
(whether because of a miscalculation of the Initial Note Rate, the Note Rate
or
otherwise), Lender shall give notice to Borrower of the corrected amount of
such
monthly payment (and the corrected amount of the Note Rate, if applicable)
and
(a) if the corrected amount of such monthly payment represents an increase
thereof, Borrower shall, within ten (10) calendar days after the date of such
notice, pay to Lender any sums that Borrower would have otherwise been obligated
under this Note to pay to Lender had the amount of such monthly payment not
been
miscalculated or (b) if the corrected amount of such monthly payment represents
a decrease thereof, and Borrower is not otherwise in breach or default under
any
of the terms and provisions of the Note, the Loan Agreement of even date
herewith by and between Borrower, Lender and other Borrowers, as defined therein
(the “Loan Agreement”) or any of the other Loan Documents, Borrower shall,
within ten (10) calendar days thereafter be paid the sums that Borrower would
not have otherwise been obligated to pay to Lender had the amount of such
monthly payment not been miscalculated.
1.6 LIBOR
Unascertainable.
Lender’s obligation to maintain interest based on LIBOR shall be suspended and
the Note Rate shall be based on the Interest Rate Index (plus Margin) upon
Xxxxxx’s determination, in good faith, that adequate and reasonable means do not
exist for ascertaining LIBOR or that a contingency has occurred which
2
materially
and adversely affects the London Interbank Eurodollar Market at which Lender
prices loans (which determination by Lender shall be conclusive and binding
on
Borrower in the absence of manifest error). Computation of the Note Rate based
on the Interest Rate Index shall continue until Lender determines that the
circumstances giving rise to Xxxxxx’s substitution of the Interest Rate Index
for LIBOR no longer exists and Lender shall promptly notify Borrower of such
determination. For purposes hereof “Interest
Rate Index”
shall
mean the weekly average yield on United States Treasury Securities adjusted
to a
constant maturity of one year, as made available by the Federal Reserve Board
forty-five (45) days prior to each Note Rate Adjustment Date.
1.7 Adjustment
for Impositions on Loan Payments.
All
payments made by Borrower under this Note and the other Loan Documents
(described in Section 8.1.1 below) shall be made free and clear of, and without
deduction or withholding for or on account of, any present or future income,
stamp or other taxes, levies, imposts, duties, charges, fees, deductions or
withholdings, and all liabilities with respect thereto, now or hereafter
imposed, levied, collected, withheld or assessed by any governmental authority
(all such non-excluded taxes, levies, imposts, duties, charges, fees,
deductions, withholdings and liabilities, collectively, “Applicable
Taxes”).
If
Borrower shall be required by law to deduct any Applicable Taxes from or in
respect of any sum payable hereunder to Lender, the following shall apply:
(i)
Borrower shall make all such required deductions and shall pay the full amount
deducted to the relevant taxing authority or other authority in accordance
with
applicable law and (ii) the sum payable to Lender shall be increased in an
amount determined by Lender in its sole discretion, as may be necessary so
that
after making all required deductions (including deductions applicable to
additional sums payable under this Section 1.7), Lender receives an amount
equal
to the sum Lender would have received had no such deductions been made. Payments
made pursuant to this Section 1.7 shall be made within ten (10) Business Days
after Xxxxxx makes written demand therefore.
1.8 Increased
Costs of Maintaining Interest.
Borrower shall pay to Lender all Funding Losses incurred from time to time
by
Lender upon demand. Lender shall deliver to Borrower a statement for any such
sums to which Xxxxxx is entitled to receive pursuant to this Section 1.8, which
statement shall be binding and conclusive absent manifest error. Payment of
Funding Losses hereunder shall be in addition to any obligation to pay any
other
fee in circumstances where such fee(s) would be due and owing under the Loan
Documents. For purposes hereof, “Funding
Losses”
shall
mean the reduction of any amounts received or receivable from Borrower, in
either case, due to the introduction of, or any change in, law or applicable
regulation or treaty (including the administration or interpretation thereof),
whether or not having the force of law, or due to the compliance by Lender
with
any directive, whether or not having the force of law, or request from any
central bank or domestic or foreign governmental authority.
1.9 Acceleration.
Notwithstanding anything to the contrary contained herein, if Xxxxxxxx is
prohibited by law from paying any amount due to Lender under Section 1.7 or
Section 1.8 hereof, Lender may elect to declare the unpaid principal balance
of
the Loan, together with all unpaid interest accrued thereon and any other
amounts due hereunder, due and payable within one hundred twenty (120) days
of
Xxxxxx’s written
3
notice
to
Borrower and no Exit Fee (defined in Section 5 below) shall be due in such
event. Xxxxxx’s delay or failure in accelerating the Loan upon the discovery or
occurrence of an event under Section 1.7 or Section 1.8 shall not be deemed
a
waiver or estoppel against the exercise of such right.
Section
2. Note
Payments and Prepayment Rights.
2.1 Note
Payments and Payment Dates.
Commencing on the 1st
day of
May, 2007, and continuing on the first (1st) day of each successive month
thereafter, provided that, if the first (1st) day of any month is not a Business
Day, such payment shall be due and payable on the immediately preceding Business
Day (each being a “Payment
Date”),
through and including the Payment Date immediately prior to the Maturity
Date,
Borrower
shall make twelve (12) consecutive monthly payments of interest only at the
Note
Rate (determined as of the immediately preceding Note Rate Payment Adjustment
Date) based upon the principal outstanding during the Interest Accrual Period
in
which the applicable Payment Date occurs, and any other amounts due under the
Loan Documents. Thereafter,
commencing on the May 1, 2008, Payment Date, Borrower shall make consecutive
monthly payments of (i) principal in an amount necessary to fully amortize
the
original principal amount of the Loan over a twenty-five (25) year amortization
period in which each month is deemed to consist of thirty (30) days; and (ii)
interest at the Note Rate (determined as of the immediately preceding Note
Rate
Adjustment Date) based on principal outstanding during the Interest Accrual
Period in which the applicable Payment Date occurs.
2.2 Prepayments.
Borrower has the right to prepay all or any part of the Loan prior to the
Maturity Date except as otherwise provided below. Borrower may only prepay
the
Loan in whole or in part (provided each such partial prepayment is in an amount
not less than the sum of $100,000.00) on any Payment Date after the Closing
Date
so long as each of the following conditions are satisfied:
| (A) |
Borrower
provides written notice to Lender of its intent to prepay not more
than
sixty (60) days and not less than thirty (30) days prior to the intended
prepayment date.
|
| (B) |
Borrower
pays with such prepayment all accrued interest through the end of
the
current Interest Accrual Period and all other outstanding amounts
then due
and unpaid under the Loan Agreement and the other Loan
Documents.
|
| (C) |
Borrower
pays with such prepayment the Exit Fee except as otherwise set forth
in
Section 5.
|
| (D) |
Borrower
pays with such prepayment all costs and expenses incurred by Lender
in
connection with such prepayment and any other costs and expenses
|
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due
and
payable by Borrower under the Loan Documents.
| (E) |
No
Event of Default exists as of the date Borrower delivers notice of
intent
to prepay and as of the date such prepayment is
made.
|
2.3 Payment
Debit Account.
During
the term of the Loan, Xxxxxxxx shall establish and maintain a deposit account
(the “Payment Debit Account”) with a bank or financial institution acceptable to
Lender and authorize such bank or financial institution to permit Lender to
debit the Payment Debit Account from time to time without limitation and without
further notice, consent or instructions from Borrower. In the absence of an
Event of Default (as defined below), Lender shall make transfers from the
Payment Debit Account only for payment of principal, interest and deposits
to
reserves and escrows due from Borrower on a Payment Date under the Note, the
Loan Agreement or any of the other Loan Documents. Borrower solely will be
responsible for maintaining funds in the Payment Debit Account which are
sufficient to pay the aggregate amounts due under the Loan Documents on each
Payment Date. If sufficient funds are not available in the Payment Debit Account
to make the full payment when due, Lender shall not be required to notify
Borrower or demand that Borrower pay the deficiency prior to declaring an Event
of Default. Debits made by Lender from the Payment Debit Account for less than
the full monthly payment amount will not release Borrower from Borrower's
obligations to pay the full amount due nor be deemed a waiver of Xxxxxx's right
to collect the full payment amount or to declare an Event of Default. Debits
made by Lender from the Payment Debit Account following the occurrence of any
Event of Default under the Loan Documents will not be deemed a waiver of that
default by Lender or otherwise prejudice, in any manner, Xxxxxx's rights or
remedies with respect thereto. Lender will have the right, upon reasonable
prior
notice to Borrower, to discontinue debiting payments from the Payment Debit
Account for the purposes set forth herein and, if at any time such debiting
has
been discontinued, to reinstate the requirement that Borrower maintain a Payment
Debit Account in accordance with the terms of this Note. Borrower will not
be
permitted to close, or permit the Payment Debit Account to be closed, without
Xxxxxx's prior written consent unless the Loan has been satisfied in full.
To
the extent there are any inconsistencies between this Section 2.3 and any
lockbox, deposit account or other cash management agreement executed by Borrower
in connection with the Loan, the terms of such lockbox, deposit account or
other
cash management agreement, as applicable, shall govern and control.
Section
3. Application
of Payments.
Payments made by Borrower on account hereof shall be applied, first, toward
any
Late Fees (defined in Section 8.3 below) or other fees and charges due
hereunder, second, toward payment of any interest due at the Default Rate,
third, toward payment of any interest due at the then applicable Note Rate
set
forth in Section 1.4 above, and fourth, toward payment of principal.
Notwithstanding the foregoing, if any advances made by Xxxxxx under the terms
of
any instruments securing this Note have not been repaid, any payments made
may,
at the option of Lender, be applied, first, to repay such advances and interest
thereon, with the balance, if any, applied as set forth in the preceding
sentence.
5
Section
4. Maturity
Date.
Anything in this Note to the contrary notwithstanding, the entire unpaid balance
of the principal amount hereof and all interest accrued thereon through the
end
of the current Interest Accrual Period and including interest accruing at the
Default Rate, to and including the Maturity Date (as defined below) together
with all fees, costs and amounts due and payable under the Loan Documents shall,
unless sooner paid, and except to the extent that payment thereof is sooner
accelerated, be and become due and payable on April 1, 2010 (the “Maturity
Date”);
provided that if the first (1st) day of that month is not a Business Day, such
payment shall be due and payable on the immediately preceding Business Day.
Section
5. Exit
Fee.
As
consideration of Xxxxxx’s making of the Loan to Xxxxxxxx, Xxxxxxxx agrees to pay
a deferred financing fee (“Exit
Fee”)
to
Lender in an amount equal to two percent (2.00%) of the original principal
amount of the Loan. Although the Exit Fee is earned in full on the date hereof,
Xxxxxx hereby agrees to defer payment of the Exit Fee until the earlier of
(a)
the date when full repayment of the Loan occurs, (b) the Maturity Date, or
(c)
the date on which the Loan has been accelerated following an Event of Default.
Notwithstanding the sale or transfer of the Loan by Capmark Bank, in whole
or in
part, to a successor lender, unless Capmark Bank has transferred its interest
in
the Exit Fee to its successors or assigns as Lender, the Exit Fee shall be
payable to Capmark Bank. Notwithstanding the foregoing, if Borrower refinances
this Loan with the proceeds of a loan from Capmark Finance Inc., or Capmark
Bank, then no Exit Fee shall be due. Borrower acknowledges that neither Capmark
Finance Inc., nor Capmark Bank has any obligation to make such
loan.
Section
6. Delivery
of Payments.
All
payments due to Lender under the Loan Documents are to be paid in lawful tender
of the United States of America, in immediately available funds, directly to
Lender at Lender’s office located at 000 Xxxxx Xxxx, X.X. Box 809, Horsham,
Pennsylvania 19044, Attn: Servicing - Accounting Manager, or at such other
place
as Lender may designate to Borrower in writing from time to time. All amounts
due under the Loan Documents shall be paid without setoff, counterclaim or
any
other deduction whatsoever. No payment due under this Note or any of the other
Loan Documents shall be deemed paid to Lender until received by Lender at its
designated office on a Business Day prior to 2:00 p.m. Eastern Standard Time.
Any payment received after the time established by the preceding sentence shall
be deemed to have been paid on the immediately following Business Day. Each
payment that is paid to Lender within ten (10) days prior to the date on which
such payment is due, and prior to its scheduled Payment Date, shall not be
deemed a prepayment and shall be deemed to have been received on the Payment
Date solely for the purpose of calculating interest due. If any payment received
by Lender is deemed by a court of competent jurisdiction to be a voidable
preference or fraudulent conveyance under any bankruptcy, insolvency or other
debtor relief law, and is required to be returned by Xxxxxx, then the obligation
to make such payment shall be reinstated, notwithstanding that the Note may
have
been marked satisfied and returned to Borrower or otherwise canceled, and such
payment shall be immediately due and payable upon demand.
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Section
7. Security.
The
debt
evidenced by this Note is to be secured by, among other things, (a) three
(3) separate mortgages (collectively, the “Mortgage”),
one
from each Borrower as identified in the Loan Agreement, for the benefit of
Lender, and (b) a
Payment and Performance Guaranty Agreement of
even
date herewith (the“Guaranty
Agreement”),
given
by Emeritus Corporation (the “Guarantor”),
for
the benefit of Lender.
Section
8. Default.
8.1 Events
of Default.
Anything in this Note to the contrary notwithstanding, on the occurrence of
any
of the following events (each of which is referred to herein, together with
each
of the Events of Default defined and described in the Loan Agreement and the
Mortgage as an “Event
of Default”),
Lender
may, in the exercise of its sole and absolute discretion, accelerate the debt
evidenced by this Note, in which event the entire outstanding principal balance
and all interest and fees accrued thereon shall immediately be and become due
and payable without further notice:
8.1.1 Failure
to Pay or Perform.
If (a)
any payment of principal and interest is not paid in full on or before the
Payment Date on which such payment is due or if the Exit Fee is not paid in
full
when required, (b) if unpaid principal, accrued but unpaid interest and all
other amounts outstanding under the Loan Documents are not paid in full on
or
before the Maturity Date or (c) there exists an uncured default under any of
the
Loan Documents which has been executed by Borrower and/or Guarantor and/or
Manager, and such default is not cured within the grace or cure period, if
any,
provided in any of such Loan Documents.
8.1.2 Bankruptcy.
(a) If
Borrower or Guarantor or Manager
(i)
applies for or consents to the appointment of a receiver, trustee or liquidator
of Borrower or Guarantor or Manager, as the case may be, or of all or a
substantial part of its assets, (ii) files a voluntary petition in bankruptcy,
or admits in writing its inability to pay its debts as they come due, (iii)
makes an assignment for the benefit of creditors, (iv) files a petition or
an
answer seeking a reorganization or an arrangement with creditors or seeking
to
take advantage of any insolvency law, (v) performs any other act of bankruptcy,
or (vi) files an answer admitting the material allegations of a petition filed
against Borrower or Guarantor or
Manager in any bankruptcy, reorganization or insolvency proceeding;
or
(b) if
(i) an
order, judgment or decree is entered by any court of competent jurisdiction
adjudicating Borrower or Guarantor or Manager a bankrupt or an insolvent, or
approving a receiver, trustee or liquidator of Borrower or Guarantor or Manager
or of all or a substantial part of its assets, or (ii) there otherwise commences
with respect to Borrower or Guarantor or Manager or any of its assets any
proceeding under any bankruptcy, reorganization, arrangement, insolvency,
readjustment, receivership or like law or statute, and if such order, judgment,
decree or proceeding
7
continues
unstayed for any period of sixty (60) consecutive days after the expiration
of
any stay thereof.
8.1.3 Judgments.
If any
judgment for the payment of money in excess of $250,000.00 hereafter awarded
against Borrower or Guarantor or Manager by any court of competent jurisdiction
remains unsatisfied or otherwise in force and effect for a period of thirty
(30)
days after the date of such award.
8.1.4 Cross-Default
and Cross-Collateralization.
This
Note is cross-defaulted and cross-collateralized with the other Loans as defined
in the Loan Agreement.
8.2 No
Impairment of Rights.
Nothing
in this Section shall be deemed in any way to alter or impair any right which
Lender has under this Note or the Mortgage, or any other Loan Documents, or
at
law or in equity, to accelerate such debt on the occurrence of any other Event
of Default provided herein or therein, whether or not relating to this
Note.
8.3 Late
Fees.
Without
limiting the generality of the foregoing provisions of this Section, if any
payment due on a Payment Date is not received in full on or before the Payment
Date, Borrower shall pay to Lender, immediately and without demand, a late
payment charge, for each month during which such payment delinquency exists,
equal to five percent (5%) of such amount (“Late
Fees”)
to
defray the expenses incurred by Xxxxxx in handling and processing such
delinquent payment and to compensate Lender for the loss of use of such
delinquent payment.
Section
9. Costs
of Enforcement.
Borrower shall pay to Lender on demand the amount of any and all expenses
incurred by Xxxxxx (a) in enforcing its rights hereunder or under the Mortgage
and/or the Loan Documents, (b) as the result of the occurrence of an Event
of
Default by Borrower in performing its obligations under this Note, including
but
not limited to the expense of collecting any amount owed hereunder, and of any
and all attorneys’ fees incurred by Lender in connection with such default,
whether suit be brought or not, and (c) in protecting the security for the
Loan
and Xxxxxxxx’s obligations under the Loan Documents. Such expenses shall be
added to the principal amount hereof, shall be secured by the Mortgage and
shall
accrue interest at the Default Rate.
Section
10. Xxxxxxxx’s
Waiver of Certain Rights.
Borrower and any endorser, guarantor or surety hereby waives the exercise of
any
and all exemption rights which it holds at law or in equity with respect to
the
debt evidenced by this Note, and of any and all rights which it holds at law
or
in equity to require any valuation, appraisal or marshalling, or to have or
receive any presentment, protest, demand and notice of dishonor, protest, demand
and nonpayment as a condition to Lender’s exercise of any of its rights under
this Note or the Loan Documents.
Section
11. Extensions.
The
Maturity Date and/or any other date by which any payment is required to be
made
hereunder may be extended by Xxxxxx, in writing, from
8
time
to
time in the exercise of its sole discretion, without in any way altering or
impairing Borrower’s or Guarantor’s liability hereunder.
Section
12. General.
12.1 Applicable
Law.
This
Note shall be given effect and construed by application of the laws of the
State
of South Carolina (without regard to the principles thereof governing conflicts
of laws), and any action or proceeding arising hereunder, and each of Xxxxxx
and
Xxxxxxxx submits (and waives all rights to object) to non-exclusive personal
jurisdiction in the State of South Carolina, for the enforcement of any and
all
obligations under the Loan Documents except that if any such action or
proceeding arises under the Constitution, laws or treaties of the United States
of America, or if there is a diversity of citizenship between the parties
thereto, so that it is to be brought in a United States District Court, it
shall
be brought in the United States District Court for the District of South
Carolina in which the Facility (as defined in the Loan Agreement) is located,
or
any successor federal court having original jurisdiction.
12.2 Headings.
The
headings of the Sections, subsections, paragraphs and subparagraphs hereof
are
provided herein for and only for convenience of reference, and shall not be
considered in construing their contents.
12.3 Construction.
As used
herein, (a) the term “person”
means a
natural person, a trustee, a corporation, a limited liability company, a
partnership and any other form of legal entity, and (b) all references made
(i)
in the neuter, masculine or feminine gender shall be deemed to have been made
in
all such genders, (ii) in the singular or plural number shall be deemed to
have
been made, respectively, in the plural or singular number as well, and (iii)
to
any Section, subsection, paragraph or subparagraph shall, unless therein
expressly indicated to the contrary, be deemed to have been made to such
Section, subsection, paragraph or subparagraph of this Note.
12.4 Severability.
No
determination by any court, governmental body or otherwise that any provision
of
this Note or any amendment hereof is invalid or unenforceable in any instance
shall affect the validity or enforceability of (a) any other such provision
or
(b) such provision in any circumstance not controlled by such determination.
Each such provision shall be valid and enforceable to the fullest extent allowed
by, and shall be construed wherever possible as being consistent with,
applicable law.
12.5 No
Waiver.
Xxxxxx
shall not be deemed to have waived the exercise of any right which it holds
hereunder unless such waiver is made expressly and in writing. No delay or
omission by Xxxxxx in exercising any such right (and no allowance by Xxxxxx
to
Borrower of an opportunity to cure a default in performing its obligations
hereunder) shall be deemed a waiver of its future exercise. No such waiver
made
as to any instance involving the exercise of any such right shall be deemed
a
waiver as to any other such instance, or any other such right. Further,
acceptance by Lender of all or any portion of any sum payable under, or partial
performance of any covenant of, this Note, the Mortgage or any of the other
Loan
Documents, whether before, on, or after the due
9
date
of
such payment or performance, shall not be a waiver of Xxxxxx’s right either to
require prompt and full payment and performance when due of all other sums
payable or obligations due thereunder or hereunder or to exercise any of
Xxxxxx’s rights and remedies hereunder or thereunder.
12.6 Waiver
of Jury Trial; Service of Process; Court Costs.
BORROWER
HEREBY WAIVES TRIAL BY JURY IN ANY ACTION OR PROCEEDING TO WHICH XXXXXXXX AND
XXXXXX MAY BE PARTIES ARISING OUT OF, IN CONNECTION WITH, OR IN ANY WAY
PERTAINING TO, THIS NOTE AND/OR ANY OF THE OTHER LOAN DOCUMENTS. IT IS AGREED
AND UNDERSTOOD THAT THIS WAIVER CONSTITUTES A WAIVER OF TRIAL BY JURY OF ALL
CLAIMS AGAINST ALL PARTIES TO SUCH ACTIONS OR PROCEEDINGS, INCLUDING CLAIMS
AGAINST PARTIES WHO ARE NOT PARTIES TO THIS NOTE. THIS WAIVER IS KNOWINGLY,
WILLINGLY AND VOLUNTARILY MADE BY BORROWER, UPON CONSULTATION WITH COUNSEL
OF
XXXXXXXX’S CHOICE, AND BORROWER HEREBY REPRESENTS THAT NO REPRESENTATIONS OF
FACT OR OPINION HAVE BEEN MADE BY ANY INDIVIDUAL TO INDUCE THIS WAIVER OF TRIAL
BY JURY OR TO IN ANY WAY MODIFY OR NULLIFY ITS EFFECT. XXXXXXXX FURTHER
REPRESENTS AND WARRANTS THAT IT HAS BEEN REPRESENTED IN THE SIGNING OF THIS
NOTE
AND IN THE MAKING OF THIS WAIVER BY INDEPENDENT LEGAL COUNSEL, OR HAS HAD THE
OPPORTUNITY TO BE REPRESENTED BY INDEPENDENT LEGAL COUNSEL SELECTED OF ITS
OWN
FREE WILL, AND THAT IT HAS HAD THE OPPORTUNITY TO DISCUSS THIS WAIVER WITH
COUNSEL. BORROWER HEREBY IRREVOCABLY DESIGNATES XXXX XXXXXXXXXX, AND HIS
SUCCESSORS IN OFFICE, AS THE TRUE AND LAWFUL ATTORNEY OF BORROWER FOR THE
PURPOSE OF RECEIVING SERVICE OF ALL LEGAL NOTICES AND PROCESS ISSUED BY ANY
COURT IN THE STATE OF SOUTH CAROLINA AS WELL AS SERVICE OF ALL PLEADINGS AND
OTHER DOCUMENTS RELATED TO ANY LEGAL PROCEEDING OR ACTION ARISING OUT OF THIS
NOTE. XXXXXXXX AGREES THAT SERVICE UPON SAID XXXX XXXXXXXXXX SHALL BE VALID
REGARDLESS OF XXXXXXXX’S WHEREABOUTS AT THE TIME OF SUCH SERVICE AND REGARDLESS
OF WHETHER XXXXXXXX RECEIVES A COPY OF SUCH SERVICE, PROVIDED THAT LENDER SHALL
HAVE MAILED A COPY TO BORROWER IN ACCORDANCE WITH THE NOTICE PROVISIONS HEREIN.
XXXXXXXX AGREES TO PAY ALL COURT COSTS AND REASONABLE ATTORNEY’S FEES INCURRED
BY XXXXXX IN CONNECTION WITH ENFORCING ANY PROVISION OF THIS NOTE.
NOTWITHSTANDING THE FOREGOING, XXXXXX AGREES TO USE REASONABLE EFFORTS TO
PROVIDE BORROWER WITH NOTICE OF THE FILING OF ANY LAWSUIT BY XXXXXX AGAINST
BORROWER.
12.7 Offset.
Upon
the occurrence of an Event of Default, Lender may set-off against any principal
and interest owing hereunder, any and all credits, money, stocks, bonds or
other
security or property of any nature whatsoever on deposit with, or held by,
10
or
in the
possession of, Xxxxxx, to the credit of or for the account of Xxxxxxxx, without
notice to or consent of Borrower or Guarantor.
12.8 Non-Exclusivity
of Rights and Remedies.
None of
the rights and remedies herein conferred upon or reserved to Lender is intended
to be exclusive of any other right or remedy contained herein or in any of
the
other Loan Documents and each and every such right and remedy shall be
cumulative and concurrent, and may be enforced separately, successively or
together, and may be exercised from time to time as often as may be deemed
necessary or desirable by Lender.
12.9 Incorporation
by Reference.
All of
the agreements, conditions, covenants and provisions contained in each of the
Loan Documents are hereby made a part of this Note to the same extent and with
the same force and effect as if they were fully set forth herein. Borrower
covenants and agrees to keep and perform, or cause to be kept and performed,
all
such agreements, conditions, covenants and provisions strictly in accordance
with their terms.
12.10 Joint
and Several Liability.
If
Borrower consists of more than one person and/or entity, each such person and/or
entity agrees that its liability hereunder is joint and several.
12.11 Business
Purpose.
Borrower represents and warrants that the Loan evidenced by this Note is being
obtained solely for the purpose of acquiring or carrying on a business,
professional or commercial activity and is not for personal, agricultural,
family or household purposes.
12.12 Interest
Limitation.
Notwithstanding anything to the contrary contained herein or in the Mortgage
or
in any other of the Loan Documents, the effective rate of interest on the
obligation evidenced by this Note shall not exceed the lawful maximum rate
of
interest permitted to be paid. Without limiting the generality of the foregoing,
in the event that the interest charged hereunder results in an effective rate
of
interest higher than that lawfully permitted to be paid, then such charges
shall
be reduced by the sum sufficient to result in an effective rate of interest
permitted and any amount which would exceed the highest lawful rate already
received and held by Lender shall be applied to a reduction of principal and
not
to the payment of interest. Xxxxxxxx agrees that for the purpose of determining
highest rate permitted by law, any non-principal payment (including, without
limitation, Late Fees and other fees) shall be deemed, to the extent permitted
by law, to be an expense, fee or premium rather than interest.
12.13 Modification.
This
Note may be modified, amended, discharged or waived only by an agreement in
writing signed by the party against whom enforcement of such modification,
amendment, discharge or waiver is sought.
12.14 Time
of the Essence.
Time is
strictly of the essence of this Note.
12.15 Negotiable
Instrument.
Xxxxxxxx agrees that this Note shall be deemed a negotiable instrument, even
though this Note may not otherwise qualify, under applicable law, absent this
paragraph, as a negotiable instrument.
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12.16 Interest
Rate after Judgment.
If
judgment is entered against Borrower on this Note, the amount of the judgment
entered (which may include principal, interest, fees, Late Fees and costs)
shall
bear interest at the Default Rate, to be determined on the date of the entry
of
the judgment.
12.17 Relationship.
Xxxxxxxx and Xxxxxx intend that the relationship between them shall be solely
that of creditor and debtor. Nothing contained in this Note or in any of the
other Loan Documents shall be deemed or construed to create a partnership,
tenancy-in-common, joint tenancy, joint venture or co-ownership by or between
Borrower and Lender.
12.18 Waiver
of Automatic Stay.
BORROWER HEREBY AGREES THAT, IN CONSIDERATION OF XXXXXX’S AGREEMENT TO MAKE THE
LOAN AND IN RECOGNITION THAT THE FOLLOWING COVENANT IS A MATERIAL INDUCEMENT
FOR
LENDER TO MAKE THE LOAN, IN THE EVENT THAT BORROWER SHALL (A) FILE WITH ANY
BANKRUPTCY COURT OF COMPETENT JURISDICTION OR BE THE SUBJECT OF ANY PETITION
UNDER ANY SECTION OR CHAPTER OF TITLE 11 OF THE UNITED STATES CODE, AS AMENDED
(THE “BANKRUPTCY
CODE”),
OR SIMILAR LAW OR STATUTE; (B) BE THE SUBJECT OF ANY ORDER FOR RELIEF ISSUED
UNDER THE BANKRUPTCY CODE OR SIMILAR LAW OR STATUTE; (C) FILE OR BE THE SUBJECT
OF ANY PETITION SEEKING ANY REORGANIZATION, ARRANGEMENT, COMPOSITION,
READJUSTMENT, LIQUIDATION, DISSOLUTION, OR SIMILAR RELIEF UNDER ANY PRESENT
OR
FUTURE FEDERAL OR STATE ACT OR LAW RELATING TO BANKRUPTCY, INSOLVENCY, OR OTHER
RELIEF FOR DEBTORS; (D) HAVE SOUGHT OR CONSENTED TO OR ACQUIESCED IN THE
APPOINTMENT OF ANY TRUSTEE, RECEIVER, CONSERVATOR, OR LIQUIDATOR; OR (E) BE
THE
SUBJECT OF AN ORDER, JUDGMENT OR DECREE ENTERED BY ANY COURT OF COMPETENT
JURISDICTION APPROVING A PETITION FILED AGAINST ANY BORROWER FOR ANY
REORGANIZATION, ARRANGEMENT, COMPOSITION, READJUSTMENT, LIQUIDATION,
DISSOLUTION, OR SIMILAR RELIEF UNDER ANY PRESENT OR FUTURE FEDERAL OR STATE
ACT
OR LAW RELATING TO BANKRUPTCY, INSOLVENCY OR RELIEF FOR DEBTORS, THEN, TO THE
EXTENT PERMITTED BY APPLICABLE LAW AND SUBJECT TO COURT APPROVAL, LENDER SHALL
THEREUPON BE ENTITLED, AND BORROWER HEREBY IRREVOCABLY CONSENTS TO, AND WILL
NOT
CONTEST, AND AGREES TO STIPULATE TO, RELIEF FROM ANY AUTOMATIC STAY OR OTHER
INJUNCTION IMPOSED BY SECTION 362 OF THE BANKRUPTCY CODE OR SIMILAR LAW OR
STATUTE (INCLUDING, WITHOUT LIMITATION, RELIEF FROM ANY EXCLUSIVE PERIOD SET
FORTH IN SECTION 1121 OF THE BANKRUPTCY CODE) OR OTHERWISE, ON OR AGAINST THE
EXERCISE OF THE RIGHTS AND REMEDIES OTHERWISE AVAILABLE TO LENDER AS PROVIDED
IN
THE LOAN DOCUMENTS, AND AS OTHERWISE PROVIDED BY LAW, AND
12
BORROWER
HEREBY IRREVOCABLY WAIVES ITS RIGHTS TO OBJECT TO SUCH
RELIEF.
12.19 “Business
Day”.
Any
reference to the term Business Day in this Note shall mean any day other than
a
Saturday, a Sunday, or days when Federal Banks located in the State of New
York
or Commonwealth of Pennsylvania are closed for a legal holiday or by government
directive. When used with respect to the Note Rate Adjustment Date, “Business
Day” shall mean a day upon which United States dollar deposits may be dealt in
on the London and New York City interbank markets and commercial banks and
foreign exchange markets are open in London and New York City.
12.20 Successors
and Assigns Bound.
The
obligations set forth in this Note shall be binding upon Borrower and its
successors and assigns.
IN
WITNESS WHEREOF, Xxxxxxxx has duly executed and delivered this Note, or caused
it to be duly executed and delivered on its behalf by its duly authorized
representatives, on the day and year first above written.
[REMAINDER
OF THIS PAGE IS INTENTIONALLY LEFT BLANK]
(SIGNATURE
PAGES ARE ATTACHED)
13
BORROWER:
EMERI-SKY
SC LLC,
a
Delaware limited liability company
|
By:
|
EMERITUS
CORPORATION,
|
a
Washington corporation
|
Its
Manager
|
By:
/s/
Xxxx Xxxxxxxxxx
Xxxx
Xxxxxxxxxx
Its: Director
of Real Estate and Legal Affairs
14
