Exhibit 10.1

 

EXECUTION VERSION

 

 

LOAN AGREEMENT

 

Dated as of December 28, 2017

 

by and among

 

THE PARTIES LISTED ON EXHIBIT B ATTACHED HERETO,

as Borrowers

 

and

 

CAPITAL ONE, NATIONAL ASSOCIATION,

as Administrative Agent and a Lender,

 

THE FINANCIAL INSTITUTIONS WHO ARE OR HEREAFTER

BECOME PARTIES TO THIS LOAN AGREEMENT,

as Lenders,

 

****************************************

with

 

CAPITAL ONE, NATIONAL

ASSOCIATION,

as Sole Lead Arranger and

Bookrunner

 

and

 

THE FINANCIAL INSTITUTIONS WHICH MAY SERVE AS

RIGHT LEAD ARRANGERS, DOCUMENTATION AGENTS

AND SYNDICATION AGENTS HEREUNDER

FROM TIME TO TIME

 

 

 

Table of Contents

 

		Page
ARTICLE 1 DEFINITIONS		1
Section 1.1	Certain Definitions	1
Section 1.2	Definitions	28
Section 1.3	Phrases	28
ARTICLE 2 LOAN TERMS		28
Section 2.1	The Loan	28
Section 2.2	Interest Rate; Late Charge	29
Section 2.3	Terms of Payment	29
Section 2.4	Prepayment	30
Section 2.5	Security; Establishment of Funds; Deposit Accounts	31
Section 2.6	Application of Payments	33
Section 2.7	Sources and Uses	35
Section 2.8	Increased Costs	35
Section 2.9	Illegality; Market Disruption Event	36
Section 2.10	[Intentionally Omitted].	37
Section 2.11	Libor Breakage Amount	37
Section 2.12	Evidence of Debt; Loan Accounts	37
Section 2.13	[Reserved]	38
Section 2.14	Mitigation Obligations; Replacement of Lenders	38
Section 2.15	Pro Rata Treatment; Sharing of Payments	39
Section 2.16	Fees	40
Section 2.17	Taxes	41
Section 2.18	Partial Releases	45
Section 2.19	Defaulting Lenders	48
ARTICLE 3 INSURANCE, CONDEMNATION AND IMPOUNDS		50
Section 3.1	Insurance	50
Section 3.2	Use and Application of Insurance Proceeds	55
Section 3.3	Condemnation Awards	56
Section 3.4	Insurance Impounds	57
Section 3.5	Real Estate Tax Impounds	58

 

 

ARTICLE 4 LEASING MATTERS		59
Section 4.1	Representations and Warranties on Leases	59
Section 4.2	Standard Lease Form; Approval Rights	60
Section 4.3	Covenants	60
Section 4.4	Tenant Estoppels	61
Section 4.5	Compliance with Loan Terms	62
ARTICLE 5 REPRESENTATIONS AND WARRANTIES		62
Section 5.1	Organization, Power and Authority; Formation Documents	62
Section 5.2	Validity of Loan Documents	62
Section 5.3	Liabilities; Litigation	63
Section 5.4	Taxes and Assessments	63
Section 5.5	Other Agreements Defaults	63
Section 5.6	Compliance with Laws	63
Section 5.7	Condemnation	63
Section 5.8	Access	63
Section 5.9	Location of Borrowers	64
Section 5.10	ERISA Employees	64
Section 5.11	Use of Loan Proceeds	64
Section 5.12	Margin Stock	64
Section 5.13	Forfeiture	64
Section 5.14	Tax Filings	65
Section 5.15	Solvency	65
Section 5.16	Full and Accurate Disclosure; No Material Adverse Change	65
Section 5.17	Flood Zone	66
Section 5.18	Single Purpose Entity/Separateness	66
Section 5.19	Compliance with International Trade Control Laws and OFAC Regulations	69
Section 5.20	Borrowers’ Funds	69
Section 5.21	Management Agreements	71
Section 5.22	Physical Condition	71
Section 5.23	No Change in Facts or Circumstances; Disclosure	71
Section 5.24	Healthcare Representations	71

 

 

ARTICLE 6 FINANCIAL REPORTING		73
Section 6.1	Financial Statements	73
Section 6.2	Compliance Certificate	75
Section 6.3	Accounting Principles	75
Section 6.4	Access	75
Section 6.5	Annual Budget	76
Section 6.6	Books and Records/Audits	76
Section 6.7	Borrower Representative.	76
ARTICLE 7 COVENANTS		76
Section 7.1	Transfers or Encumbrance of Property.	77
Section 7.2	Taxes and Utility Charges	78
Section 7.3	Management	78
Section 7.4	Operation; Maintenance; Inspection	79
Section 7.5	Taxes on Security	79
Section 7.6	Legal Existence, Name, Etc.	80
Section 7.7	Further Assurances	80
Section 7.8	Estoppel Certificates Regarding Loan	80
Section 7.9	Notice of Certain Events	81
Section 7.10	Payment for Labor and Materials	81
Section 7.11	Use and Proceeds, Revenues	81
Section 7.12	Compliance with Laws and Contractual Obligations.	81
Section 7.13	Operating and Financial Covenants	82
Section 7.14	Transactions with Affiliates	82
Section 7.15	Representations and Warranties	82
Section 7.16	Alterations	83
Section 7.17	Business and Operations	83
Section 7.18	Severability of Covenants	83
Section 7.19	Healthcare Covenants.	83
Section 7.20	Cooperation Regarding Primary Licenses and Permits	85
Section 7.21	Required Repairs and Post Closing Obligations	86
ARTICLE 8 EVENTS OF DEFAULT		86
Section 8.1	Payments	86
Section 8.2	Insurance	86
Section 8.3	Prohibited Transfer	86

 

 

Section 8.4	Covenants	86
Section 8.5	Representations and Warranties	87
Section 8.6	Other Encumbrances	87
Section 8.7	Collateral	87
Section 8.8	Involuntary Bankruptcy or Other Proceeding	87
Section 8.9	Voluntary Petitions, Etc.	87
Section 8.10	Default Under Operators’ Agreements	87
Section 8.11	[Reserved].	87
Section 8.12	Certain Covenants	87
Section 8.13	Financial Information	88
Section 8.14	Default Under Recourse Guaranty Agreement	88
Section 8.15	Criminal Act	88
Section 8.16	Environmental Indemnity Agreement	88
Section 8.17	Required Repairs and Post Closing Obligations	88
Section 8.18	Secured Hedge Agreement	88
Section 8.19	Admissions Restrictions	88
Section 8.20	Healthcare Investigations.  The occurrence of a Healthcare Investigation affecting any of the Projects.	88
Section 8.21	Change of Control	88
ARTICLE 9 REMEDIES		89
Section 9.1	Remedies – Insolvency Events	89
Section 9.2	Remedies – Other Events; Protective Advances	89
Section 9.3	Administrative Agent’s Right to Perform the Obligations	90
Section 9.4	Special Right to Cure with Respect to Operational Defaults	91
ARTICLE 10 ADMINISTRATIVE AGENT		93
Section 10.1	Appointment and Duties	93
Section 10.2	Binding Effect	94
Section 10.3	Use of Discretion	95
Section 10.4	Delegation of Rights and Duties	95
Section 10.5	Reliance and Liability	95
Section 10.6	Administrative Agent Individually	97
Section 10.7	Lender Credit Decision	97
Section 10.8	Expenses	97

 

 

Section 10.9	Resignation of Administrative Agent	98
Section 10.10	Additional Secured Parties	98
Section 10.11	Reliance by Administrative Agent	99
Section 10.12	Rights as a Lender	99
Section 10.13	Standard of Care; Indemnification	100
Section 10.14	Failure to Act	100
Section 10.15	Titles	100
Section 10.16	USA Patriot Act Notice; Compliance	100
Section 10.17	No Reliance on Administrative Agent's Customer Identification Program	101
Section 10.18	Defaults.	101
ARTICLE 11 MISCELLANEOUS		105
Section 11.1	Notices	105
Section 11.2	Amendments and Waivers	107
Section 11.3	Successors and Assigns	111
Section 11.4	Indemnity	114
Section 11.5	Debtor-Creditor Relationship	114
Section 11.6	Right of Setoff	114
Section 11.7	Sharing of Payments, Etc.	115
Section 11.8	Marshaling; Payments Set Aside	115
Section 11.9	Limitation on Interest	116
Section 11.10	Invalid Provisions	116
Section 11.11	Reimbursement of Expenses	117
Section 11.12	Approvals; Third Parties; Conditions	117
Section 11.13	Administrative Agent and Lenders Not in Control; No Partnership	118
Section 11.14	Contest of Certain Claims	118
Section 11.15	Time of the Essence	119
Section 11.16	Acknowledgement and Consent to Bail-In of EEA Financial Institutions	119
Section 11.17	Renewal, Extension or Rearrangement	119
Section 11.18	Waivers	119
Section 11.19	Cumulative Rights; Joint and Several Liability	120

 

 

Section 11.20	Joint and Several Liability of all Borrowers	120
Section 11.21	Singular and Plural	125
Section 11.22	Exhibits and Schedules	125
Section 11.23	Titles of Articles, Sections and Subsections	125
Section 11.24	Non-Public Information; Confidentiality	125
Section 11.25	Survival	127
Section 11.26	Waiver of Jury Trial	127
Section 11.27	Waiver of Punitive or Consequential Damages	127
Section 11.28	Governing Law	127
Section 11.29	Entire Agreement	127
Section 11.30	Counterparts	128
Section 11.31	Consents and Approvals	128
Section 11.32	Effectiveness of Facsimile Documents and Signatures	128
Section 11.33	Venue	128
Section 11.34	Important Information Regarding Procedures for Requesting Credit	128
Section 11.35	Method of Payment	129
Section 11.36	Component Note	129
Section 11.37	Post-Closing Obligations of Borrowers	129
Section 11.38	Release and Waiver Regarding Special Audits	130
Section 11.39	Limitation on Liability of Administrative Agent and Lenders’ Officers, Employees, Etc.	134

 

 

EXHIBITS AND SCHEDULES

 

Exhibits A-1 – A-23	Description of Projects
Exhibit B	List of Borrowers
Exhibit C	Form of Assignment Agreement
Exhibit D	Names of  Operating Tenants
Exhibit E	Lender Addresses
Schedule 1.1(a)	Management Agreements
Schedule 1.1(b)	Existing Property Managers
Schedule 2.1	Conditions to Advance of Loan Proceeds
Schedule 4.1	Exceptions to Representations and Warranties Regarding Leases
Schedule 5.1	Organization; Formation
Schedule 5.4	Taxes and Assessments
Schedule 5.7	Condemnation
Schedule 5.9	Locations of Borrowers
Schedule 5.24(a)	Third Party Payor Programs
Schedule 5.24(b)	Primary Licenses
Schedule 5.24(c)	Governmental Investigations
Schedule 5.24(d)	Violations, Charges or Deficiencies
Schedule 6.2	Compliance Certificate
Schedule 11.19	Allocated Loan Amounts for Projects
Schedule 11.37	Post-Closing Obligations and Required Repairs

 

 

LOAN AGREEMENT

 

This Loan Agreement (including all exhibits and schedules hereto, as the same may be amended, modified, or restated from time to time, this “Agreement”) is entered into as of December 28, 2017, by and among THE PARTIES LISTED ON EXHIBIT B ATTACHED HERETO and each other entity that becomes a borrower hereunder pursuant to the terms hereof (each a “Borrower” and collectively, “Borrowers”), CAPITAL ONE, NATIONAL ASSOCIATION (“CONA”), as administrative agent and collateral agent for Lenders (as defined herein) (in such capacity and together with its successors and permitted assigns, “Administrative Agent”), and THE FINANCIAL INSTITUTIONS WHO ARE OR HEREAFTER BECOME PARTIES TO THIS AGREEMENT as Lenders (together with their successors and permitted assigns, each a “Lender” and collectively, “Lenders”).

 

WITNESSETH:

 

WHEREAS, Borrowers have requested that Administrative Agent and Lenders agree to (a) refinance or terminate certain existing indebtedness, (b) pay transaction fees incurred in connection with this Agreement and the Loan (as defined below), and (c) provide a Loan in the amount of up to $82,000,000.00 to be used by Borrowers, subject to the terms and conditions set forth herein.

 

WHEREAS, each Lender is willing to agree (severally and not jointly) to make such Loan and provide such financial accommodations to Borrowers in accordance with its Pro Rata Share, on the terms and conditions set forth herein, and Administrative Agent is willing to act as agent for Lenders on the terms and conditions set forth herein and the other Loan Documents.

 

NOW, THEREFORE, in consideration of the covenants set forth in this Agreement, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto hereby agree as follows:

 

ARTICLE 1

 

DEFINITIONS

 

Section 1.1            Certain Definitions. As used herein, the following terms have the meanings indicated:

 

“Acceptable Accounting Method” means (i) GAAP or (ii) an accrual based accounting methodology reasonably acceptable to Administrative Agent.

 

“ACH” has the meaning assigned in Section 2.6(c).

 

“Additional Transfer” has the meaning assigned in Section 11.35.

 

“Adjusted Net Operating Income” or “ANOI” means, for any Test Period, without duplication, Consolidated Revenue less Consolidated Expenses, in each case, calculated for Borrowers and their subsidiaries on a consolidated basis in accordance with an Acceptable Accounting Method.

 

 

“Administrative Agent” has the meaning assigned in the preamble to this Agreement.

 

“Administrative Questionnaire” means an Administrative Questionnaire in a form supplied by Administrative Agent.

 

“Advisor” means Healthcare Trust Advisors, LLC.

 

“Advisory Agreement” means that certain Second Amended and Restated Advisory Agreement, dated as of February 17, 2017, by and among Advisor, Sponsor and REIT (as the same has been amended from time to time).

 

“Affiliate” means, with respect to any Person, (a) any corporation in which such Person or any partner, shareholder, director, officer, member, or manager of such Person directly or indirectly owns or controls more than twenty percent (20%) of the beneficial interest, (b) any partnership, joint venture or limited liability company in which such Person or any partner, shareholder, director, officer, member, or manager of such Person is a partner, joint venturer or member, (c) any trust in which such Person or any partner, shareholder, director, officer, member or manager of such Person is a trustee or beneficiary, (d) any Person which is directly or indirectly owned or controlled by such Person or any partner, shareholder, director, officer, member or manager of such Person, or (e) any Person related by birth, adoption or marriage to any partner, shareholder, director, officer, member, manager, or employee of such Person. Each Borrower Party shall be deemed an Affiliate of Borrowers.

 

“Affiliated Manager” means any property manager in which any Borrower, or any Affiliate of any Borrower has, directly or indirectly, any legal, beneficial or economic interest.

 

“Agency Disposition Assets” means those assets listed on Schedule I.

 

“Agent Parties” has the meaning assigned in Section 11.1(d)(ii).

 

“Agreement” means this Loan Agreement, as amended, restated, supplemented, or otherwise modified from time to time.

 

“Allocated Loan Amounts” means for each Project existing on the Closing Date, the principal amount of the Loan allocated to such Project and set forth on Schedule 11.19 hereto.

 

“Anti-Money Laundering Laws” means those laws, regulations and sanctions, state and federal, criminal and civil, that (a) limit the use of and/or seek the forfeiture of proceeds from illegal transactions; (b) limit commercial transactions with designated countries or individuals believed to be terrorists, narcotics dealers or otherwise engaged in activities contrary to the interests of the United States; (c) require identification and documentation of the parties with whom a Financial Institution conducts business; or (d) are designed to disrupt the flow of funds to terrorist organizations. Such laws, regulations and sanctions shall be deemed to include the Patriot Act, the Bank Secrecy Act, TWEA, IEEPA, and the sanction regulations promulgated pursuant thereto by the OFAC, as well as laws relating to prevention and detection of money laundering in 18 U.S.C. Sections 1956 and 1957.

 

 

“Approved Fund” means, with respect to Administrative Agent or any Lender, any Person (other than a natural Person) that (a) is or will be engaged in making, purchasing, holding or otherwise investing in commercial loans and similar extensions of credit in the ordinary course of its business, and (b) is advised or managed by (i) Administrative Agent or such Lender or (ii) any Affiliate of Administrative Agent or such Lender.

 

“Approved Insurer” means any insurer (other than Medicaid/Medicare/TRICARE) as may be approved by Administrative Agent from time to time in its sole discretion.

 

“Assignment Agreement” means an assignment agreement entered into by a Lender, as assignor, and any Person, as assignee, pursuant to the terms and provisions of Section 11.3 (with the consent of any party whose consent is required by Section 11.3), accepted by Administrative Agent, substantially in the form of Exhibit C or any other form approved by Administrative Agent.

 

“Assignment of Hedge Agreement” means any Assignment of Interest Rate Protection Agreement executed and delivered by the hedge provider and the counterparty under the Hedge Agreement to Administrative Agent (on behalf of itself and Lenders), as amended, restated, supplemented, or otherwise modified from time to time.

 

“Assignment of Ownership Interests” means the Ownership Pledge, Assignment of Membership Interests and Security Agreement, executed by Sponsor for the benefit of Administrative Agent (on behalf itself and Lenders) and pertaining to all of the membership interests in each Borrower, as amended, restated, supplemented, or otherwise modified from time to time.

 

“ASTM” means the American Society for Testing and Materials.

 

“Award” has the meaning assigned in Section 3.3.

 

“Bail-In Action” means the exercise of any Write-Down and Conversion Powers by the applicable EEA Resolution Authority in respect of any liability of an EEA Financial Institution.

 

“Bail-In Legislation” means, with respect to any EEA Member Country implementing Article 55 of Directive 2014/59/EU of the European Parliament and of the Council of the European Union, the implementing law for such EEA Member Country from time to time which is described in the EU Bail-In Legislation Schedule.

 

“Bank Secrecy Act” means the Bank Secrecy Act, 31 U.S.C. Section 5311, et seq.

 

“Bankruptcy Code” the Federal Bankruptcy Reform Act of 1978, 11 U.S.C. Section 101 et seq., as the same may be amended from time to time.

 

“Bankruptcy Party” has the meaning assigned in Section 8.8.

 

 

“Base Rate” means the rate of interest from time to time announced by CONA at its principal office as its prime commercial lending rate, it being understood that such prime commercial rate is a reference rate and does not necessarily represent the lowest or best rate being charged by CONA to any customer and such rate is set by CONA based upon various factors including CONA’s costs and desired return, general economic conditions and other factors. Any change in such prime rate announced by CONA shall take effect at the opening of business on the day specified in the announcement of such change.

 

“Borrower” and “Borrowers” have the meaning assigned in the preamble to this Agreement.

 

“Borrower Formation Documents” has the meaning assigned in Section 5.1(b).

 

“Borrower Materials” has the meaning assigned in Section 11.23(e).

 

“Borrower Party” means each Borrower and each Guarantor.

 

“Borrower Representative” has the meaning assigned in Section 6.7(a).

 

“Borrowers’ Knowledge” means the knowledge of a Borrower after commercially reasonable inquiry, including without limitation the knowledge of a Borrower acquired through its diligent administration of the Leases, review of all material information, reports and notices provided by Operators under the Leases and the Operators’ representations, warranties, covenants, terms and other conditions contained in the Leases, as applicable, review of existing reports (e.g., Site Assessments and Property Condition Reports) regarding the Projects, inquiry of the current Property Manager (or other operator of the Project) and notices provided to a Borrower by State Regulators and/or other governmental or quasi-governmental agencies having jurisdiction over the Projects.

 

“Business Day” means a day other than a Saturday, a Sunday, or a legal holiday on which national banks located in the State of New York are not open for general banking business. If such day relates to the determination of the Libor Rate, “Business Day” means any such day on which dealings in Dollar deposits are conducted by and between banks in the London interbank Eurodollar market.

 

“Cash Equivalents” means (a) any readily-marketable securities (i) issued by, or directly, unconditionally and fully guaranteed or insured by the United States federal government or (ii) issued by any agency of the United States federal government the obligations of which are fully backed by the full faith and credit of the United States federal government, (b) any readily-marketable direct obligations issued by any other agency of the United States federal government, any state of the United States or any political subdivision of any such state or any public instrumentality thereof, in each case having a rating of at least “A-1” from S&P or at least “P-1” from Moody’s, (c) any commercial paper rated at least “A-1” by S&P or “P-1” by Moody’s and issued by any Person organized under the laws of any state of the United States, (d) any Dollar-denominated time deposit, insured certificate of deposit, overnight bank deposit or bankers’ acceptance issued or accepted by (i) any Lender or (ii) any commercial bank that is (A) organized under the laws of the United States, any state thereof or the District of Columbia, (B) “adequately capitalized” (as defined in the regulations of its primary federal banking regulators) and (C) has Tier 1 capital (as defined in such regulations) in excess of $250,000,000 and (e) shares of any United States money market fund that (i) has substantially all of its assets invested continuously in the types of investments referred to in clause (a), (b), (c) or (d) above with maturities as set forth in the proviso below, (ii) has net assets in excess of $500,000,000 and (iii) has obtained from either S&P or Moody’s the highest rating obtainable for money market funds in the United States; provided, however, that the maturities of all obligations specified in any of clauses (a), (b), (c) or (d) above shall not exceed 365 days.

 

 

“Casualty” has the meaning assigned in Section 3.2(a).

 

“Census Report” means, with respect to a Project, a report which records the number of licensed beds for the Project, as well as the number of patients and patient census days by Third Party Payor source.

 

“Change in Law” means the occurrence, after the Closing Date, of any of the following: (a) the adoption or taking effect of any law, rule, regulation or treaty, (b) any change in any law, rule, regulation or treaty or in the interpretation or application thereof by any Governmental Authority or (c) compliance by Administrative Agent or any Lender with any request, guideline or directive (whether or not having the force of law) of any Governmental Authority made or issued after the Closing Date; provided, however, that notwithstanding anything herein to the contrary, (i) the Dodd-Frank Wall Street Reform and Consumer Protection Act and all requests, rules, guidelines, requirements and directives thereunder or issued in connection therewith or in implementation thereof and (ii) all requests, rules, guidelines, requirements and directives promulgated by the Bank for International Settlements, the Basel Committee on Banking Supervision (or any successor or similar authority) or the United States or foreign regulatory authorities, in each case pursuant to Basel III, shall be deemed to be a “Change in Law”, regardless of the date enacted, adopted, issued or implemented.

 

“Change of Control” means the occurrence of any of the following, except as otherwise approved in advance in writing by Lenders in their sole and absolute discretion acting reasonably:

 

(a)          before the Internalization, the Advisor or a replacement advisor consented to in writing by the Required Lenders, shall fail to be the advisor of the REIT or the Sponsor; or

 

(b)          any “person” or “group” (as such terms are used in Sections 13(d) and 14(d) of the Exchange Act) becomes the “beneficial owner” (as defined in Rules 13d-3 and 13d-5 under the Exchange Act), directly or indirectly, of twenty percent (20%) or more of the equity securities of REIT entitled to vote for members of the board of directors or equivalent governing body of REIT on a fully-diluted basis; or

 

(c)          after the Internalization, fewer than three-fifths of the members of the board of the directors of the REIT as of the date of the Internalization cease to be on the board of directors of the REIT or the Chief Executive Officer or Chief Financial Officer dies, becomes disabled or is replaced or resigns; provided it shall not be a “Change of Control” if a replacement executive of comparable experience and reasonably satisfactory to the Administrative Agent shall have been retained within six (6) months of such event.

 

(d)          REIT, together with any Affiliates Controlled by REIT, at any time ceases to own and Control, directly or indirectly, fifty-one percent (51%) or more of the issued and outstanding stock, partnership interests, or membership interests of Sponsor and Borrowers; or

 

 

(e)          REIT ceases to own and Control, directly or indirectly, one hundred percent (100%) of the general partnership interest of Sponsor; or

 

(f)           Sponsor ceases to own and Control, directly or indirectly, one hundred percent (100%) of the issued and outstanding stock, partnership interests, or membership interests of Borrowers.

 

in each instance in clause (d), free and clear of all liens, rights, options, warrants or other similar agreements or understandings, other than Liens in favor of Administrative Agent, for the benefit of the Secured Parties; and provided, that any Transfer of more than a twenty percent (20%) (or such lesser percentage as may be required from time to time to satisfy applicable regulatory requirements) direct or indirect interest in Borrowers shall be subject to completion of customer diligence by Administrative Agent and each Lender reasonably satisfactory to Administrative Agent and each Lender.

 

“Closing Date” means the date the Loan is funded by Lenders.

 

“Code” means the Internal Revenue Code of 1986, as amended, and as it may be further amended from time to time, any successor statutes thereto, and applicable U.S. Department of Treasury regulations issued pursuant thereto in temporary or final form.

 

“Collateral” means all real and personal property with respect to which Liens in favor of Administrative Agent (for the benefit of Lenders) are granted pursuant to the Loan Documents and which secure the Obligations described in the Loan Documents, any Secured Hedge Agreement, and Lender Cash Management Agreements, and includes, without limitation, all of each Borrower’s right, title and interest in, to and under all personal property, real property, and other assets that arise from, are used in connection with, are related to or are located at the Projects, whether now owned by or hereafter acquired by any Borrower (including all personal property and other assets owned or acquired under any trade names, styles or derivations thereof), regardless of where located.

 

“Collateral Assignment of Management Agreement” means each of the Assignment and Subordination of Management Agreement(s) executed by an Operating Tenant, a Property Manager, a Borrower, and Administrative Agent, as amended, restated, supplemented, or otherwise modified from time to time.

 

“Commercial Lease” means all leases and subleases of the Projects or any part thereof now existing or hereafter executed in accordance with the terms hereof but excluding the (a) Residential Leases and (b) the Operating Leases.

 

“Commodity Exchange Act” means the Commodity Exchange Act (7 U.S.C. § 1 et seq.).

 

“Compliance Certificate” means the compliance certificate in the form of Schedule 6.2 attached hereto.

 

“CON” means a certificate of need or similar certificate, license or approval issued by the State Regulator for the requisite number of Residential Units in each of the Projects.

 

 

“CONA” means Capital One, National Association, together with its successors and assigns.

 

“Condemnation” has the meaning assigned in Section 3.3.

 

“Connection Income Taxes” means Other Connection Taxes that are imposed on or measured by net income (however denominated) or that are franchise Taxes or branch profits Taxes.

 

“Consolidated Adjusted Debt Service” means the sum of (a) Consolidated Interest Expense and (b) if as of the test date no scheduled principal payments are then payable on the Loan, the principal payment that would be required for the aggregate amount funded to be amortized assuming a 25-year mortgage amortization at an assumed rate of 5%, and (c) principal due (other than balloon payments due at maturity) during such period under the Loan, if any, and under any other permitted Debt relating to the Projects or Borrowers and their subsidiaries, which Debt is expressly approved by Administrative Agent but not including payments applied to escrows or reserves required by this Agreement.

 

“Consolidated Expenses” means actual operating expenses of the applicable Operators related to the Projects, excluding any rent and interest paid and depreciation recorded by the applicable Operators on a stabilized accrual basis for the previous twelve (12) month period (as reasonably adjusted by Administrative Agent), including the following (but without double counting): (a) recurring expenses as determined under GAAP, (b) real estate taxes, (c) management and other fees under Management Agreements (whether paid or not) in an amount equal to the greater of (x) actual fees paid in such period and (y) five percent (5%) of effective gross income, and (d) a replacement reserve (whether reserved or not) of not less than Three Hundred Fifty and No/100 Dollars ($350.00) per Residential Unit.

 

“Consolidated Interest Expense” means for the Test Period, the sum of (a) total interest expense on all Debt of Borrowers and their subsidiaries (including payments made under any Hedge Agreement, and expenses attributable to capital lease obligations (if permitted hereunder) in accordance with an Acceptable Accounting Method), plus (b) fees with respect to all outstanding Debt including capitalized interest, but excluding commissions, discounts and other fees owed with respect to letters of credit and bankers’ acceptance financing and net costs under Hedge Agreements, minus (c) payments received under Hedge Agreements, all calculated for Borrowers and their subsidiaries on a consolidated basis in accordance with an Acceptable Accounting Method.

 

“Consolidated Revenue” means the revenues generated by the applicable Operators at the Projects for the period in question (and if none specified, then for the most current twelve (12) months), as determined under in accordance with an Acceptable Accounting Method; but excluding (a) nonrecurring income and non-property related income (as determined by Administrative Agent in its reasonable discretion) and income from tenants that is classified as “bad debt” under in accordance with an Acceptable Accounting Method, (b) entrance fee income with respect to any continuing care retirement community, and (c) late fees and interest income; provided, however, that if actual occupancy of the Projects, taken as a whole, exceeds 95%, Adjusted Revenue shall be proportionately reduced assuming an occupancy of 95%.

 

 

“Contract Rate” has the meaning assigned in Section 2.2.

 

“Control” or “controls” means, when used with respect to any specified Person, the power to direct the management and policies of such Person, directly or indirectly, whether through the ownership of voting securities or other beneficial interests, by contract, by its position with such Person as general partner or managing member, or otherwise; and the terms “Controlling” and “Controlled” have the meanings correlative to the foregoing.

 

“De Minimis Lease” means any Lease which does not exceed five thousand (5,000) rentable square feet of any Individual Project and the rent from which equals five percent (5%) or less of the total revenue of all Projects in the aggregate; provided, however, that multiple Leases with the same Tenant or known Affiliates of such Tenants shall constitute one (1) Lease for purposes of this definition if with respect to a subject Lease action or lease event, such multiple Leases are affected.

 

“Debt” means, for any Person, without duplication: (a) all indebtedness of such Person for borrowed money, for amounts drawn under a letter of credit, or for the deferred purchase price of property for which such Person or any of its assets is liable, (b) all unfunded amounts under a loan agreement, letter of credit, or other credit facility for which such Person or any of its assets would be liable or subject, if such amounts were advanced under the credit facility, (c) all amounts required to be paid by such Person as a guaranteed payment to partners or a preferred or special dividend, including any mandatory redemption of shares or interests, (d) all indebtedness guaranteed by such Person, directly or indirectly, (e) all obligations under leases that constitute capital leases for which such Person or any of its assets is liable or subject, and (f) all obligations of such Person under interest rate swaps, caps, floors, collars and other interest hedge agreements, in each case whether such Person or any of its assets is liable or subject contingently or otherwise, as obligor, guarantor or otherwise, or in respect of which obligations such Person otherwise assures a creditor against loss.

 

“Debt Service Coverage Ratio” means for the applicable period, as of the date of determination, the ratio obtained by dividing (a) Adjusted Net Operating Income by (b) Consolidated Adjusted Debt Service.

 

“Debt Yield” means for the applicable period, as of the date of determination, the percentage obtained by dividing Adjusted Net Operating Income by the aggregate amount of the Loan then outstanding. In the event that Debt Yield for a period of twelve (12) months (or other calculation period) is not available, Borrowers shall annualize the Debt Yield for such period of time as is available.

 

“Debtor Relief Laws” means the Bankruptcy Code and all other liquidation, conservatorship, bankruptcy, assignment for the benefit of creditors, moratorium, rearrangement, receivership, insolvency, reorganization, or similar debtor relief laws of the United States or other applicable jurisdictions from time to time in effect.

 

“Default Rate” means the lesser of (a) the maximum rate of interest allowed by applicable law, and (b) five percent (5%) per annum in excess of the Contract Rate.

 

 

“Defaulting Lender” means, subject to Section 2.19(b), any Lender that (a) has failed to (i) fund all or any portion of its pro rata share of the Loan or any Protective Advance within two (2) Business Days of the date such amount was to be funded unless such Lender notifies Administrative Agent and Borrowers in writing that such failure is the result of such Lender’s determination that one or more conditions precedent to funding (each of which conditions precedent, together with any applicable default, shall be specifically identified in such writing) has not been satisfied, or (ii) pay to Administrative Agent or any Lender any other amount required to be paid by it hereunder within two (2) Business Days of the date when due, (b) has notified Borrowers and Administrative Agent in writing that it does not intend to comply with its funding obligations hereunder, or has made a public statement to that effect (unless such writing or public statement relates to such Lender’s obligation to fund a Loan hereunder and states that such position is based on such Lender’s determination that a condition precedent to funding (which condition precedent, together with any applicable default, shall be specifically identified in such writing or public statement) cannot be satisfied), (c) has failed, within two (2) Business Days after written request by Agent or Borrowers, to confirm in writing to Agent and Borrowers that it will comply with its prospective funding obligations hereunder (provided that such Lender shall cease to be a Defaulting Lender pursuant to this clause (c) upon receipt of such written confirmation by Agent and Borrowers), or (d) has, or has a direct or indirect parent company that has, (i) become the subject of a proceeding under any Debtor Relief Law, (ii) had appointed for it a receiver, custodian, conservator, trustee, administrator, assignee for the benefit of creditors or similar Person charged with reorganization or liquidation of its business or assets, including the Federal Deposit Insurance Corporation or any other state or federal regulatory authority acting in such a capacity, or (iii) become the subject of a Bail-in Action; provided that a Lender shall not be a Defaulting Lender solely by virtue of the ownership or acquisition of any equity interest in that Lender or any direct or indirect parent company thereof by a Governmental Authority so long as such ownership interest does not result in or provide such Lender with immunity from the jurisdiction of courts within the United States or from the enforcement of judgments or writs of attachment on its assets or permit such Lender (or such Governmental Authority) to reject, repudiate, disavow or disaffirm any contracts or agreements made with such Lender. Any determination by Agent that a Lender is a Defaulting Lender under any one or more of clauses (a) through (d) above shall be conclusive and binding absent manifest error, and such Lender shall be deemed to be a Defaulting Lender (subject to Section 2.19(b)) upon delivery of written notice of such determination to Borrowers and each Lender.

 

“Deposit Account” means a “deposit account” (as defined in Article 9 of the UCC), an investment account, or other account in which funds are held or invested for credit to or for the benefit of any Borrower.

 

“Deposit Account Bank” means, as applicable, (a) Administrative Agent or (b) another bank or financial institution reasonably acceptable to Administrative Agent.

 

“Deposit Account Control Agreement” means individually or collectively, as applicable, (a) each agreement, in form and substance reasonably satisfactory to Administrative Agent, among Administrative Agent, a Borrower, and the Deposit Account Bank, that provide the Administrative Agent with “Control” (as such term is used and defined in Article 9 of the UCC) on a springing basis and (b) such bank shall agree that it shall have no Lien on, or right of setoff or recoupment against such Deposit Account or the contents thereof, other than in respect of commercially reasonable fees and other items (to the extent permitted by Requirements of Law), in each such case expressly reasonably consented to by Administrative Agent.

 

 

“Dollars” and the sign “$” each mean the lawful money of the United States of America.

 

“EEA Financial Institution” means (a) any credit institution or investment firm established in any EEA Member Country which is subject to the supervision of an EEA Resolution Authority, (b) any entity established in an EEA Member Country which is a parent of an institution described in clause (a) of this definition, or (c) any Financial Institution established in an EEA Member Country which is a subsidiary of an institution described in clauses (a) or (b) of this definition and is subject to consolidated supervision with its parent.

 

“EEA Member Country” means any of the member states of the European Union, Iceland, Liechtenstein, and Norway.

 

“EEA Resolution Authority” means any public administrative authority or any person entrusted with public administrative authority of any EEA Member Country (including any delegee) having responsibility for the resolution of any EEA Financial Institution.

 

“Electronic Transmission” means any process of communication that does not directly involve the physical transfer of paper and that is suitable for the retention, retrieval and reproduction of information by the recipient.

 

“Eligible Assignee” means (a) any existing Lender, (b) any Affiliate or Approved Fund of any existing Lender, or (c) any other Person acceptable to Administrative Agent and, to the extent required by Section 11.3, Borrower Representative. Notwithstanding the foregoing, none of Borrowers, any of their Subsidiaries, any of their Affiliates, any Defaulting Lender, or any natural person (or any holding company, investment vehicle, or trust for, or owned and operated for, the primary benefit of a natural person) shall be an Eligible Assignee.

 

“Environmental Indemnity Agreement” means that certain Hazardous Materials Indemnity Agreement dated of even date hereof in favor of Administrative Agent (for itself and on behalf of Lenders) executed by Borrowers and each Guarantor with respect to the Projects, in each case as amended, restated, supplemented, or otherwise modified from time to time.

 

“Environmental Laws” means any federal, state or local law (whether imposed by statute, ordinance, rule, regulation, administrative or judicial order, or common law), now or hereafter enacted, governing Hazardous Materials, including, without limitation, such laws (a) governing or regulating the use, generation, storage, removal, recovery, treatment, handling, transport, disposal, control, release, discharge of, or exposure to, Hazardous Materials or (b) requiring notification or disclosure of releases of Hazardous Materials or other environmental conditions whether or not in connection with a transfer of title to or interest in property.

 

“ERISA” means the Employee Retirement Income Security Act of 1974, as amended from time to time, and all rules and regulations promulgated thereunder.

 

 

“E-System” means any electronic system approved by Agent, including Intralinks®, Syndtrak®, and ClearPar® and any other Internet or extranet-based site, whether such electronic system is owned, operated or hosted by Agent, any of its Related Persons or any other Person, providing for access to data protected by passcodes or other security system.

 

“EU Bail-In Legislation Schedule” means the EU Bail-In Legislation Schedule published by the Loan Market Association (or any successor person), as in effect from time to time.

 

“Event of Default” has the meaning assigned in Article 8.

 

“Exchange Act” means the Securities Exchange Act of 1934, as amended and in effect from time to time.

 

“Excluded Hedge Agreement Obligation” means, with respect to any Loan Party, any guarantee of any Swap Obligations under a Secured Hedge Agreement if, and only to the extent that and for so long as, all or a portion of the guarantee of such Loan Party of, or the grant by such Loan Party of a security interest to secure, such Swap Obligation under a Secured Hedge Agreement (or any guarantee thereof) is or becomes illegal under the Commodity Exchange Act or any rule, regulation or order of the Commodity Futures Trading Commission (or the application or official interpretation of any thereof) by virtue of such Loan Party’s failure for any reason to constitute an “eligible contract participant” as defined in the Commodity Exchange Act at the time the guarantee of such Loan Party or the grant of such security interest becomes effective with respect to such Swap Obligation under a Secured Hedge Agreement; provided, however, that if any Loan Party that was not an “eligible contract participant” at the time any such guarantee of a Swap Obligation under a Secured Hedge Agreement was entered into thereafter becomes an “eligible contract participant,” such Loan Party shall, by virtue of the guaranty or security agreement or joinder thereto and without any further action by any Person, be deemed to have guaranteed the Swap Obligations under Secured Hedge Agreements and granted a security interest to secure such Swap Obligations under Secured Hedge Agreements, and such Swap Obligations under Secured Hedge Agreements shall no longer constitute Excluded Hedge Agreement Obligations with respect to such Loan Party. If a Swap Obligation under a Secured Hedge Agreement arises under a master agreement governing more than one swap, such exclusion shall apply only to the portion of such Swap Obligation under a Secured Hedge Agreement that is attributable to swaps for which such guarantee or security interest is or becomes illegal.

 

“Excluded Taxes” any of the following Taxes imposed on or with respect to a Recipient or required to be withheld or deducted from a payment to a Recipient, (a) Taxes imposed on or measured by net income (however denominated), franchise Taxes, and branch profits Taxes, in each case, (i) imposed as a result of such Recipient being organized under the laws of, doing business in, or having its principal office or, in the case of any Lender, its applicable lending office located in, the jurisdiction imposing such Tax (or any political subdivision thereof) or (ii) that are Other Connection Taxes, (b) in the case of a Lender, U.S. federal withholding Taxes imposed on amounts payable to or for the account of such Lender pursuant to a law in effect on the date on which (i) such Lender became a party hereto (other than pursuant to an assignment request by Borrowers under Section 2.14) or (ii) such Lender changes its lending office, except in each case to the extent that, pursuant to Section 2.17, amounts with respect to such Taxes were payable either to such Lender’s assignor immediately before such Lender became a party hereto or to such Lender immediately before it changed its lending office, (c) Taxes attributable to such Recipient’s failure to comply with Section 2.17 and (d) any U.S. federal withholding Taxes imposed under FATCA.

 

 

“Existing Property Manager” means those certain property managers identified on Schedule 1.1(b) attached hereto.

 

“Exit Fee” means, with respect to any repayment or prepayment of principal of the Loan, including, without limitation, any prepayment as a result of the acceleration of the Indebtedness after an Event of Default (but not any prepayment in connection with a casualty or condemnation), an amount equal to (a) with respect to any Projects that are Agency Disposition Asset, two percent (2.0%) of the Allocated Loan Amount being repaid and (b) with respect to any Projects (other than Agency Disposition Assets), one percent (1.0%) of the principal amount of the Allocated Loan Amount with respect thereto being repaid; provided that, anything herein to the contrary notwithstanding, no Exit Fee shall be due or payable (i) with respect to any portion of the Loan refinanced through FNMA or FHLMC with CONA or any Affiliate of CONA acting as agent, originator or seller or (ii) with respect to any portion of the Loan that is not refinanced through FNMA or FHLMC as result of FNMA or FHLMC financing no longer being available under applicable law or because the applicable Project being refinanced does not qualify for financing through FNMA or FHLMC.

 

“Extension Period” has the meaning assigned in Section 2.3.

 

“FATCA” means Sections 1471 through 1474 of the Code as of the date of this Agreement (or any amended or successor version that is substantively comparable and not materially more onerous to comply with), any current or future regulations or official interpretations thereof and any agreements entered into pursuant to Section 1471(b)(1) of the Code.

 

“Federal Bankruptcy Code” means Chapter 11 of Title II of the United States Code (11 U.S.C. § 101, et seq.), as amended.

 

“Federal Flood Insurance” means, for any Improvements personal property Collateral located on any Project located in a Special Flood Hazard Area, Federal Flood Insurance or private insurance satisfactory to Administrative Agent, in either case, that (a) meets the requirements of FEMA and other applicable federal agencies, (b) includes a deductible not to exceed $50,000 unless otherwise approved by Administrative Agent or permitted by applicable laws and (c) has a coverage amount equal to the maximum amount of coverage available under the National Flood Insurance Program.

 

“Federal Funds Rate” means, for any day, the rate per annum (rounded upwards, if necessary, to the nearest 1/32 of 1%) equal to the weighted average of the rates on overnight Federal funds transactions with members of the Federal Reserve System, provided that if such day is not a Business Day, the Federal Funds Rate for the immediately preceding Business Day shall be applicable, as determined by Administrative Agent, or such other commercial bank as selected by Administrative Agent in a commercially reasonable manner.

 

 

“Fee Letter” means that certain $82,000,000 Loan Fee Letter dated as of the Closing Date, among Borrowers and Administrative Agent, with respect to certain fees payable by Borrowers in connection with the Loan, as the same may be amended, restated, supplemented, or otherwise modified from time to time.

 

“FEMA” means the Federal Emergency Management Agency, a component of the U.S. Department of Homeland Security that administers the National Federal Flood Insurance Program.

 

“Financial Institution” means a United States Financial Institution as defined in 31 U.S.C. 5312, as amended from time to time.

 

“FHLMC” means the Federal Home Loan Mortgage Corporation.

 

“FIRREA” has the meaning assigned in Schedule 2.1.

 

“FNMA” means the Federal National Mortgage Association.

 

“Foreign Lender” (a) if any Borrower is a U.S. Person, a Lender that is not a U.S. Person, and (b) if any Borrower is not a U.S. Person, a Lender that is resident or organized under the laws of a jurisdiction other than that in which such Borrower is resident for tax purposes.

 

“Funds” means the Required Repair Fund and the Replacement Escrow Fund.

 

“GAAP” means generally accepted accounting principles in the United States of America, as in effect from time to time, set forth in the opinions and pronouncements of the Accounting Principles Board of the American Institute of Certified Public Accountants, in the statements and pronouncements of the Financial Accounting Standards Board (or agencies with similar functions and comparable stature and authority within the accounting profession) that are applicable to the circumstances as of the date of determination. Subject to Section 1.3, all references to “GAAP” shall be to GAAP applied consistently with the principles used in the preparation of the financial statements described in Section 5.1.

 

“Governmental Approvals” means, collectively, all consents, licenses, and permits, and all other authorizations or approvals required from any Governmental Authority to operate the Projects.

 

“Governmental Authority” means the government of the United States of America or any other nation, or of any political subdivision thereof, whether state or local, and any agency, authority, instrumentality, regulatory body, court, central bank or other entity exercising executive, legislative, judicial, taxing, regulatory or administrative powers or functions of or pertaining to government (including any supra-national bodies such as the European Union or the European Central Bank and the State Regulator).

 

“Guarantor” means, individually and collectively, Sponsor, and each Person who from time to time is party to a Recourse Guaranty Agreement, or otherwise guarantees the Obligations or any portion thereof.

 

 

“Hazardous Materials” means (a) petroleum or chemical products, whether in liquid, solid, or gaseous form, or any fraction or by-product thereof, (b) asbestos or asbestos-containing materials, (c) polychlorinated biphenyls (pcbs), (d) radon gas, (e) underground storage tanks, (f) any explosive or radioactive substances, (g) lead or lead-based paint, (h) any other substance, material, waste or mixture which is or shall be listed, defined, or otherwise determined by any Governmental Authority to be hazardous, toxic, or otherwise regulated, controlled or giving rise to liability, under any Environmental Laws, (i) any excessive moisture, mildews, mold or other fungi in quantities and/or concentrations that could reasonably be expected to pose a risk to human health or the environment, or (j) any elements, material, compounds, mixtures, chemicals, wastes, pollutants, contaminants or substances known to cause cancer or reproductive toxicity, that, because of its quantity, concentration or physical or chemical characteristics, exposure is limited or regulated by any Governmental Authority having jurisdiction over human health and safety, natural resources or the environment, or which poses a significant present or potential hazard to human health and safety, or to the environment, if released into the workplace or the environment.

 

“Healthcare Investigations” means (a) any inquiries, investigations, probes, audits or proceedings by any Governmental Authorities concerning the compliance of the business affairs, practices, licensing or reimbursement entitlements of the Projects, any Borrower, any Guarantor or any Operator with applicable Healthcare Laws (including, without limitation, inquiries involving the Comprehensive Error Rate Testing and any inquiries, investigations, probes, audits or proceedings initiated by a Fiscal Intermediary/Medicare Administrative Contractor, Medicaid Integrity Contractor, Recovery Audit Contractor, Program Safeguard Contractor, Zone Program Integrity Contractor, State Attorney General, Office of Inspector General, U.S. Department of Health and Human Services, Department of Justice or similar governmental agencies or contractors for such agencies), (b) any whistleblower suits, or suits brought by any third party or any patient, employee, or resident pursuant to federal or state “false claims acts” and Medicaid, Medicare or state fraud and/or abuse laws in each case related to Healthcare Laws and a Project, a Borrower Party or Operator, (c) any notice of violation of Healthcare Laws at a level that under Healthcare Laws requires the immediate or accelerated filing of a plan of correction with a Governmental Authority, and (d) any notice that a Project is to be added or has been added to the CMS Special Focus Facility list.

 

“Healthcare Laws” means (a) all applicable state and federal statutes, codes, ordinances, orders, rules, and regulations (i) relating to health information (as defined at 45 C.F.R. 160.103 (“Protected Health Information”), including HIPAA, as amended by HITECH and the respective rules and regulations promulgated thereunder, and all other applicable state and federal laws regarding the privacy and security of Protected Health Information, (ii) accreditation standards of the State Regulator, and (iii) governing the establishment, construction, ownership, operation, licensure, use or occupancy of the Projects or any part thereof as a skilled nursing facility, assisted living facility, memory care facility, or other healthcare or senior living facility, including all conditions of participation pursuant to Medicare and/or Medicaid certification; (b) 42 U.S.C. Section 1320a-7(b) (Criminal Penalties for Acts Involving Federal Health Care Programs), commonly referred to as the “Federal Anti-Kickback Statute”; (c) 42 U.S.C. Section 1395nn (Limitation on Certain Physician Referrals), commonly referred to as the “Stark Statute”; and (d) 31 U.S.C. Section 3729-33, and commonly referred to as the “False Claims Act”.

 

 

“Hedge Agreement” means, collectively, any and all swap agreements (as such term is defined in Section 101 of the Federal Bankruptcy Code), interest rate cap agreements, interest rate collar agreements or other similar agreements designed to provide protection against fluctuations in interest or currency exchange rates, hereafter entered into by or on behalf of the applicable Borrower Party, as the same may be renewed, extended, amended or replaced from time to time.

 

“HIPAA” means the Health Insurance Portability and Accountability Act of 1996, as amended.

 

“HIPAA Compliance Date” has the meaning assigned in Section 7.19(b).

 

“HIPAA Compliance Plan” has the meaning assigned in Section 7.19(b).

 

“HIPAA Compliant” has the meaning assigned in Section 7.19(b).

 

“IEEPA” has the meaning assigned in Section 5.20(f).

 

“Improvements” shall mean, individually and/or collectively (as the context requires), the “Improvements” as defined in each applicable Mortgage.

 

“Indebtedness” means all payment obligations of Borrowers or any other Borrower Party to Administrative Agent or to any Lender under the Loan or any of the Loan Documents, including, without limitation, any and all interest, whether or not accruing after the filing of any petition in bankruptcy or the commencement of any insolvency, reorganization or similar proceeding, and whether or not a claim for post-filing or post-petition interest is allowed in any such proceeding.

 

“Individual Project” shall mean each parcel of Land and other improvements now or in the future located on such particular parcel of Land and all related facilities, amenities, fixtures, and personal property owned by an applicable Borrower and used in connection therewith.

 

“Indemnified Matters” has the meaning assigned in Section 11.4(a).

 

“Indemnified Taxes” (a) Taxes, other than Excluded Taxes, imposed on or with respect to any payment made by or on account of any obligation of any Borrower Party under any Loan Document and (b) to the extent not otherwise described in (a), Other Taxes.

 

“Indemnitee” has the meaning assigned in Section 11.4(a).

 

“Insurance Impound” has the meaning assigned in Section 3.4.

 

“Insurance Premiums” has the meaning assigned in Section 3.1(d).

 

 

“Internalization” means a transaction or series of related transactions (including, without limitation, mergers, consolidations, stock or other ownership interest purchases or modifications of agreements) whereby (a) the Advisor ceases or reduces the level of its services accompanied by an elimination or a commensurate reduction of the amount of the fees payable to the Advisor under the Advisory Agreement, (b) REIT or any of its wholly owned Subsidiaries employs persons previously employed by the Advisor and (c) REIT or any of its wholly owned Subsidiaries subsequently is to perform all or some of the duties previously performed by Advisor.

 

“Land” means, individually and collectively, as applicable, the real property described in Exhibits A-1 through A-23 attached hereto.

 

“Leases” means all leases of, subleases of and occupancy agreements affecting the Projects or any part thereof now existing or hereafter executed (including all patient and resident care agreements and service agreements which include an occupancy agreement) and all amendments, modifications or supplements thereto.

 

“Lease Subordination Agreement” means (whether one or more) those certain Subordination and Attornment Agreements dated of even date herewith, executed by Operating Tenants, Borrowers and Administrative Agent (on behalf of itself and Lenders).

 

“Lender Cash Management Agreements” means any and all cash management agreements, if any, entered into from time to time between any Borrower Party, on the one hand, and Administrative Agent or any Lender or any Affiliate of a Lender, on the other hand, in connection with and ancillary to any Deposit Account Control Agreements entered into in connection this Agreement or the Projects.

 

“Lender Transferee” has the meaning assigned in Section 11.3(a).

 

“Lender(s)” has the meaning assigned in the preamble to this Agreement. In addition to the foregoing, solely for the purpose of identifying the Persons entitled to share in payments and collections from the Collateral and the benefit of any guarantees of the Obligations as more fully set forth in this Agreement and the other Loan Documents, the term “Lender” shall include Secured Hedge Providers and any Lender or Affiliate thereof party to a Lender Cash Management Agreement. For the avoidance of doubt, any Person to whom any Obligations in respect of a Secured Hedge Agreement or Lender Cash Management Agreement are owed and which does not hold any portion of the Loans or commitments hereunder shall not be entitled to any other rights as a “Lender” under this Agreement or the other Loan Documents and the Environmental Indemnity.

 

“Liabilities” means all claims, actions, suits, judgments, damages, losses, liability, obligations, responsibilities, fines, penalties, sanctions, costs, fees, taxes, commissions, charges, disbursements and expenses, in each case of any kind or nature (including interest accrued thereon or as a result thereof and fees, charges and disbursements of financial, legal and other advisors and consultants), whether joint or several, whether or not indirect, contingent, actual, punitive, treble or otherwise, but in no event any of the foregoing that are compensatory, consequential, special or punitive, except to the extent arising from a third party claim and paid or required to be paid to a third party.

 

“Libor Breakage Amount” means the actual out of pocket amount of any losses, expenses and liabilities that such Lender or any of its Affiliates may sustain as a result of any payment of the Loan (or any portion thereof) on any day that is not the last day of the Libor Interest Period applicable thereto (regardless of the source of such prepayment and whether voluntary, by acceleration or otherwise).

 

 

“Libor Interest Period” means (a) the period commencing on the Closing Date through December 31, 2017, and (b) thereafter each period commencing on the first day of a calendar month and ending on the last day of such calendar month; provided, any Libor Interest Period that would otherwise extend beyond the Maturity Date of the Loan shall end on the Maturity Date.

 

“Libor Rate” means for each Libor Interest Period, the offered rate for deposits in Dollars for the applicable Libor Interest Period appearing on the Reuters Screen LIBOR01 page as of 11:00 a.m. (London time) two (2) Business Days prior to the next preceding first day of each Libor Interest Period. In the event that such rate does not appear on the Reuters Screen LIBOR01 page at such time, the “Libor Rate” shall be determined by reference to such other comparable publicly available service for displaying the offered rate for deposit in Dollars in the London interbank market as may be selected by Administrative Agent and, in the absence of availability, such other method to determine such offered rate as may be selected by Administrative Agent in its sole discretion; provided, that if at any time the Libor Rate, as determined hereby, would be less than zero, it shall be deemed to be zero for purposes of this Agreement.

 

“Lien” means any interest, or claim thereof, in the Projects securing an obligation owed to, or a claim by, any Person other than the owner of the Projects, whether such interest is based on common law, statute or contract, including the lien or security interest arising from a deed of trust, mortgage, assignment, encumbrance, pledge, security agreement, conditional sale or trust receipt or a lease, consignment or bailment for security purposes. The term “Lien” shall include reservations, exceptions, encroachments, easements, rights of way, covenants, conditions, restrictions, recorded, capital or financing leases and other title exceptions and encumbrances affecting the Projects.

 

“Loan” or “Loans” means, collectively, the loans in the aggregate original principal amount of $82,000,000.00 made by Lenders to Borrowers under this Agreement.

 

“Loan Commitment” means with respect to each Lender, the commitment of such Lender to make its Pro Rata Share of the Loan to Borrowers. The aggregate amount of the Loan Commitment is $82,000,000.00.

 

“Loan Documents” means, collectively, this Agreement, the Notes, the Mortgages, UCC financing statements, any Recourse Guaranty Agreement, Assignment of Ownership Interests, any Assignment of Hedge Agreement, any Collateral Assignment of Management Agreement, the Fee Letter, the Security Agreement, any subordination, non-disburbance and/or attornment agreements or similar agreement related to the Loan to the extent executed by a Borrower Party or its Affiliate, any letter of credit provided to Administrative Agent (for itself and on behalf of Lenders) in connection with the Loan, the Secured Hedge Agreement, if any, all other documents evidencing or securing the Loan, and all amendments, modifications, renewals, substitutions and replacements of any of the foregoing; provided however, in no event shall the term “Loan Documents” include the Environmental Indemnity Agreement.

 

 

“Loan Party” means each Borrower and Guarantor.

 

“Loan Year” means (a) for the first Loan Year, the period commencing on the Closing Date and ending on the last day of the month in which the first anniversary of the Closing Date occurs (unless the Closing Date is on the first day of a month, in which case the first Loan Year shall commence on such Closing Date and end on the date twelve (12) months after the last day of the month immediately preceding the Closing Date) and (b) each consecutive twelve calendar month period, thereafter, until the Maturity Date.

 

“Management Agreements” means, collectively, (a) those certain agreements between an Operating Tenant and a Property Manager for the management of the Projects, as the case may be, in the form approved by Administrative Agent on or before the Closing Date and set forth on Schedule 1.1(a), (b) any subsequent management agreement, in form and substance reasonably approved by Administrative Agent in accordance with Section 7.3, between a Borrower and a Property Manager, and (c) all amendments, restatements, modifications, and supplements to a Management Agreement reasonably approved by Administrative Agent in accordance with Section 7.3.

 

“Material Action” means to file any insolvency, or reorganization case or proceeding, to institute proceedings to have any Borrower or any other Borrower Party be adjudicated bankrupt or insolvent, to institute proceedings under any applicable insolvency law, to seek any relief under any law relating to relief from debts or the protection of debtors, to consent to the filing or institution of bankruptcy or insolvency proceedings against any Borrower Party, to file a petition seeking, or consent to, reorganization or relief with respect to any Borrower Party under any applicable federal or state law relating to bankruptcy or insolvency, to seek or consent to the appointment of a receiver, liquidator, assignee, trustee, sequestrator, custodian, or any similar official of or for any Borrower Party or a substantial part of its respective property, to make any assignment for the benefit of creditors of any Borrower Party, the admission in writing by any Borrower Party of such Person’s inability to pay its debts generally as they become due, or to take action in furtherance of any of the foregoing.

 

“Material Adverse Change” or “material adverse change” means, in Administrative Agent’s reasonable discretion, that the business, operations or financial condition of a Person or property has changed in a manner which could reasonably be expected to materially impair the value of the Collateral taken as a whole, prevent timely repayment of the Loan or otherwise prevent the applicable Person from timely performing any of its material obligations under the Loan Documents or Environmental Indemnity Agreement.

 

“Material Adverse Effect” or “material adverse effect” means, in Administrative Agent’s reasonable discretion, a material adverse effect on (a) the condition (financial or otherwise), operations, business, assets, liabilities or prospects of Borrowers taken as a whole, or any other Borrower Party, (b) the ability of Borrowers taken as a whole, or any other Borrower Party, to perform any material obligation required of them under the Loan Documents, (c) the rights and remedies of Administrative Agent and Lenders under the Loan Documents, or (d) the operations of all or a material portion of the Projects.

 

 

“Maturity Date” means, as applicable, the earlier of (a) December 28, 2019, as the same may be extended to December 28, 2020, pursuant to Section 2.3(c), and (b) the date on which the entire Loan is required to be paid in full, by acceleration or otherwise, under and pursuant to this Agreement or any of the other Loan Documents.

 

“Medicaid” means Title XIX of the Social Security Act, which was enacted in 1965 to provide a cooperative federal-state program for low income and medically indigent persons, which is partially funded by the federal government and administered by the states.

 

“Medicare” means Title XVIII of the Social Security Act, which was enacted in 1965 to provide a federally funded and administered health program for the aged and certain disabled persons.

 

“MNPI” has the meaning assigned in Section 11.23(a).

 

“Mortgage” means, collectively (whether one or more), as applicable, the Mortgage(s), Assignment of Leases and Rents, Security Agreement and Fixture Filing, the Deed(s) of Trust, Assignment of Leases and Rents, Security Agreement and Fixture Filing, or the Deed(s) to Secure Debt, Assignment of Leases and Rents, Security Agreement and Fixture Filing, each executed by the applicable Borrower in favor of Administrative Agent (for itself and on behalf of Lenders), covering the applicable Borrower’s Individual Project, as amended, restated, supplemented, or otherwise modified from time to time.

 

“National Federal Flood Insurance Program” means the program created by the U.S. Congress pursuant to the National Federal Flood Insurance Act of 1968 and the Flood Disaster Protection Act of 1973, as revised by the National Federal Flood Insurance Reform Act of 1994, and as the same may be further amended, modified or supplemented, and including the regulations issued thereunder, that, among other things, mandates the purchase of Federal Flood Insurance to cover real property improvements and contents located in Special Flood Hazard Areas in participating communities and may provide protection to property owners through a federal insurance program.

 

“Non-Consenting Lender” has the meaning assigned in Section 11.2(g).

 

“Note” and “Notes” means, collectively, each promissory note (together with all renewals, modifications and extensions thereof and any replacement or additional notes) executed by Borrowers in favor of a Lender pursuant to the terms hereof.

 

 

“Obligations” means the Indebtedness and any and all existing and future debts, liabilities and obligations of every kind or nature at any time owing by any Borrower and any other Borrower Party to Administrative Agent and Lenders under this Agreement or any other Loan Document, whether joint or several, related or unrelated, primary or secondary, matured or contingent, due or to become due (including debts, liabilities and obligations obtained by assignment), and whether principal, interest, fees, indemnification obligations hereunder or expenses (specifically including interest accruing after the commencement of any bankruptcy, insolvency or similar proceeding with respect to any Borrower or any other Borrower Party, whether or not a claim for such post-commencement interest is allowed), including, without limitation, any obligations under any Secured Hedge Agreements, any extensions, modifications, substitutions, increases and renewals of the Loan (provided that the Obligations of any Loan Party shall not include Excluded Hedge Agreement Obligations of such Loan Party); the payment of all amounts advanced by Administrative Agent, any Lender or any Affiliate of a Lender to preserve, protect and enforce rights hereunder and in the Collateral; and all expenses incurred by Administrative Agent, any Lender or any Affiliate of a Lender. Without limiting the generality of the foregoing, Obligations shall include any other debts, liabilities or obligations owing to Administrative Agent, any Lender or any Affiliate of a Lender in connection with (1) any Lender Cash Management Agreements and (2) any Secured Hedge Agreements; provided, however, that any obligations with respect to Secured Hedge Agreements or Lender Cash Management Agreements, as applicable, that are owing to a (i) Lender or an Affiliate of a Lender other than Administrative Agent or its Affiliates or (ii) a Secured Hedge Provider which is not a Lender or an Affiliate of a Lender shall only constitute “Obligations” hereunder if the applicable Secured Hedge Agreement or Lender Cash Management Agreement was entered into on or after the Closing Date and the applicable Lender, Affiliate of a Lender or Secured Hedge Provider gave written notice to Administrative Agent of the same within 10 days thereafter.

 

“OFAC” means the Office of Foreign Assets Control, Department of the Treasury.

 

“Operating Leases” means those certain lease agreements dated as of the Closing Date, between a Borrower, as a landlord, and an Operating Tenant, as a tenant, and covering the Projects.

 

“Operating Tenants” means the parties listed on Exhibit D and any successor operating tenant of the Projects approved by Administrative Agent or expressly permitted under this Agreement.

 

“Operator”, individually, and “Operators”, collectively, means each Operating Tenant, each Property Manager, each property sublessee and/or other operator under any Operators’ Agreement and any successor to such Operator that is approved by Administrative Agent in its reasonable discretion or expressly permitted under this Agreement.

 

“Operators’ Agreements” means, collectively, each Management Agreement, each Operating Lease, and/or other similar agreement regarding the management and operation of the Projects between (a) a Borrower and an Operating Tenants, and (b) an Operating Tenant and a Property Manager.

 

“Other Connection Taxes” means with respect to any Recipient, Taxes imposed as a result of a present or former connection between such Recipient and the jurisdiction imposing such Tax (other than connections arising from such Recipient having executed, delivered, become a party to, performed its obligations under, received payments under, received or perfected a security interest under, engaged in any other transaction pursuant to or enforced any Loan Document, or sold or assigned an interest in any Loan or Loan Document).

 

“Other Taxes” means all present or future stamp, court or documentary, intangible, recording, filing or similar Taxes that arise from any payment made under, from the execution, delivery, performance, enforcement or registration of, from the receipt or perfection of a security interest under, or otherwise with respect to, any Loan Document, except any such Taxes that are Other Connection Taxes imposed with respect to an assignment of any interest in any Loan or Loan Document.

 

 

“Overpaying Borrower” has the meaning assigned in Section 11.19(i).

 

“Overpayment Amount” has the meaning assigned in Section 11.19(i).

 

“Partial Release” has the meaning assigned in Section 2.18(a).

 

“Partial Release Price” has the meaning assigned in Section 2.18(a)(ix).

 

“Partial Release Project” has the meaning assigned in Section 2.18(a).

 

“Participant” has the meaning assigned in Section 11.3(e).

 

“Participant Register” has the meaning assigned in Section 11.3(e).

 

“Patriot Act” means the Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism (USA PATRIOT ACT) Act of 2001 (Public Law 107-56), as the same may be amended from time to time, and corresponding provisions of future laws related thereto.

 

“Payment Date” means the first (1^st) day of each calendar month during the term of the Loan.

 

“Permit” means, with respect to any Person, any permit, approval, authorization, license, registration, certificate (including certificates of occupancy), concession, grant, franchise, variance or permission from, and any other contractual obligations with, any Governmental Authority, in each case whether or not having the force of law and applicable to or binding upon such Person or any of its property or to which such Person or any of its property is subject.

 

“Permitted Encumbrances” has the meaning assigned in Section 7.1(a).

 

“Permitted Exceptions” means, with respect to each Project, collectively (a) the Liens and security interests created by the Loan Documents, (b) all Liens, encumbrances and other matters disclosed in the Title Policy, (c) Liens, if any, for Taxes imposed by any Governmental Authority not yet delinquent or which are being contested in good faith, and for which adequate reserves are being maintained in accordance with an Acceptable Accounting Method, (d) statutory Liens for labor or materials that (i) secure sums not yet delinquent, (ii) secure sums not in excess of $100,000 in the aggregate, (iii) are bonded over or discharged to Administrative Agent’s reasonable satisfaction within thirty (30) days, and (iv) are being contested in good faith in accordance with the terms and conditions of this Agreement, (e) the rights of customers, licensees, invitees, guests and other occupants at each Project to occupy the Project in the ordinary course, (f) rights of (i) tenants, as tenants only, under the terms of Leases either reasonably approved or deemed approved by Administrative Agent (if such approval is required under the Loan Documents) or for which Administrative Agent’s approval is not required hereunder, and (ii) the Property Manager under the Management Agreements, solely to the extent provided therein or in any amendment thereto reasonably approved or deemed approved by Administrative Agent (to the extent such approval is required by the terms hereof), (g) other encumbrances and restrictions not materially affecting the use or enjoyment of the Projects and not to exceed $100,000, and (h) any other encumbrances, liens or other matters approved by Administrative Agent or Required Lenders in their reasonable discretion.

 

 

“Permitted Transfer” means any of the following Transfers, and such other Transfers as otherwise approved in advance in writing by Lenders in their sole and absolute discretion acting reasonably:

 

(a)          the Transfer, in one or a series of transactions including by way of merger, through which REIT is merged with or into any Person so long as the survivor of any such Transfer is REIT and there is no Change of Control;

 

(b)          the listing, offer, sale, transfer or issuance of shares of stock in (x) REIT or (y) in any other Restricted Party that, in each instance, is a publicly traded entity (or, with respect to REIT, in connection therewith is being listed as a publicly traded entity) on a national exchange;

 

(c)          the Transfer, in one or a series of transactions, of the stock, partnership interests or membership interests (as the case may be) by REIT or any direct or indirect legal or beneficial owner of REIT for estate planning purposes to the transferor’s spouse, child, parent, grandparent, grandchild, niece, nephew, aunt, uncle or other immediate family members of such transferor, or to a trust for the benefit of such spouse, child, parent, grandparent, grandchild, niece, nephew, aunt, uncle or other immediate family members; and

 

(d)          an Internalization that does not result in a Change of Control.

 

“Person” means any individual, corporation, partnership, joint venture, association, joint stock company, trust, trustee, estate, limited liability company, unincorporated organization, real estate investment trust, government or any agency or political subdivision thereof or any other form of entity.

 

“Post-Closing Obligations” means the post-closing requirements described on Schedule 11.37.

 

“Pledging Lender” has the meaning assigned in Section 11.35.

 

“Potential Default” means the occurrence of any event or condition which, with the giving of notice, the passage of time, or both, would constitute an Event of Default.

 

“Potential Non-Monetary Default” means any Potential Default, excluding those that can be cured or performed with the payment of money.

 

“Primary License” means, with respect to any Project or Person operating such Project, as the case may be, CON, permit or license to operate as a skilled nursing/assisted living/Alzheimer’s facility, and each Medicaid/Medicare/TRICARE provider agreement.

 

“Prohibited Transfer” has the meaning assigned in Section 7.1(a).

 

 

“Projects” means, collectively, the Land and healthcare facilities located on the Land, and all related facilities, amenities, fixtures, and personal property owned by Borrowers and any other improvements now or hereafter located on the Land.

 

“Property Condition Report” has the meaning assigned in Schedule 2.1.

 

“Property Manager” means (a) each of the Existing Property Managers and (b) any subsequent manager of one or more of the Projects approved by Administrative Agent following the Closing Date pursuant to Section 7.3.

 

“Pro Rata Outstandings” means, with respect to any Lender at any time, the outstanding principal amount of the Loan owing to such Lender at such time.

 

“Pro Rata Share” means, with respect to any Lender at any time the percentage obtained by dividing (i) the Loan Commitment of such Lender then in effect by (ii) the sum of the Loan Commitments and (b) after the making of the Loan, the percentage obtained by dividing (i) the Pro Rata Outstandings of such Lender by (ii) the total outstanding principal amount of the Loan; provided, however, that, if there are no Loan Commitments and no Pro Rata Outstandings, such Lender’s Pro Rata Share shall be determined based on the Pro Rata Share most recently in effect, after giving effect to any subsequent assignment and any subsequent non-pro rata payments of any Lender pursuant to the terms of this Agreement.

 

“Prorated Interest” has the meaning assigned in Section 2.4(b).

 

“Protective Advances” has the meaning assigned in Section 9.2(b).

 

“Qualified ECP Guarantor” means, in respect of any Swap Obligation under a Secured Hedge Agreement, each guarantor that has total assets exceeding $10,000,000 at the time the relevant guarantee or grant of the relevant security interest becomes effective with respect to such Swap Obligation under a Secured Hedge Agreement or such other person as constitutes an “eligible contract participant” under the Commodity Exchange Act and can cause another person to qualify as an “eligible contract participant” at such time by entering into a keepwell under Section 1a(18)(A)(v)(II) of the Commodity Exchange Act.

 

“Recipient” has the meaning assigned in Section 11.38.

 

“Recourse Guaranty Agreement” means that certain Guaranty of Recourse Obligations executed by Sponsor, as amended, restated, supplemented, or otherwise modified from time to time.

 

“Register” has the meaning assigned in Section 2.12(b).

 

“REIT” means Healthcare Trust, Inc., a Maryland corporation.

 

“Register” has the meaning specified in Section 2.12(b).

 

 

“Related Persons” means, with respect to any Person, each of such Person’s Affiliates, officers, directors, employees, agents, trustees, representatives, attorneys, accountants, and each insurance, environmental, legal, financial and other advisor and other consultants and agents of or to such Person or any of its Affiliates, together with, if such Person is Administrative Agent, each other Person or individual designated, nominated or otherwise mandated by or helping Administrative Agent pursuant to and in accordance with Section 10.4 or any comparable provision of any Loan Document or the Environmental Indemnity Agreement.

 

“Release Notice” has the meaning assigned in Section 2.18(a)(v).

 

“Replacement Escrow Fund” has the meaning assigned in Section 2.5(b)(ii).

 

“Reports” has the meaning assigned in Section 11.37.

 

“Required Lenders” means, at any time, both Agent and Lenders whose combined Pro Rata Shares at such time are in excess of fifty percent (50%) in the aggregate; provided, however, that: (i) the Loan Commitment of, and the portion of the Obligations held or deemed held by, any Defaulting Lender shall be excluded for purposes of making a determination of Required Lenders; and (ii) Required Lenders must at all times include two (2) Lenders that are not Affiliates, unless at any time there is only one (1) Lender or all Lenders are Affiliates.

 

“Required Repairs” has the meaning assigned in Section 2.5(b)(i).

 

“Required Repair Fund” has the meaning assigned in Section 2.5(b)(i).

 

“Requirements of Law” means, with respect to any Person or Project, collectively, the common law and all federal, state, local, foreign, multinational or international laws, statutes, codes, treaties, standards, rules and regulations, guidelines, ordinances, orders, judgments, writs, injunctions, decrees (including administrative or judicial precedents or authorities) and the interpretation or administration thereof by, and other determinations, directives, requirements or requests of, any Governmental Authority, in each case whether or not having the force of law and that are applicable to or binding upon such Person or Project or any of its other property or to which such Person or any of its property is subject, as the same may be amended from time to time.

 

“Residential Leases” means, collectively, occupancy and admission agreements (including all patient and resident care agreements and service agreements which include an occupancy agreement) covering the Residential Units.

 

“Residential Units” means, collectively, (a) each skilled nursing bed, Alzheimer’s unit and/or assisted living unit authorized under the Primary Licenses and (b) each independent living unit comprising the Projects.

 

“Restoration Threshold” means an amount (per Project and as of any date) equal to the lesser of (a) five percent (5%) of the replacement value of the improvements at the affected Project as of such date, and (b) $1,000,000.

 

“Restricted Party” means each (a) Borrower Party, (b) any Affiliated Manager, (c) each Operating Tenant, and (d) each Guarantor.

 

 

“Secured Hedge Agreement” means (whether one or more) any Hedge Agreement between any one or more of the Borrower Representative or a Borrower Party (or an Affiliate of any such Borrower) and a Secured Hedge Provider.

 

“Secured Hedge Provider” means (a) a Lender or an Affiliate of a Lender (or a Person who was a Lender or an Affiliate of a Lender at the time of execution and delivery of a Hedge Agreement) who has entered into a Hedge Agreement with any Borrower Party, or (b) a Person with whom any Borrower has entered into a Hedge Agreement provided or arranged by CONA or an Affiliate of CONA or for which CONA or an Affiliate of CONA has provided credit enhancement through either an assignment right or a letter of credit in favor of such Person, and any assignee thereof.

 

“Secured Parties” means, the holders of the Obligations from time to time and shall include (a) each Lender, (b) the Administrative Agent, and the Lenders in respect of all other present and future obligations and liabilities of the Borrower Parties of every type and description arising under or in connection with this Agreement or any other Loan Document and the Environmental Indemnity Agreement, (c) each Lender and Affiliate of such Lender in respect of Hedge Agreements and Lender Cash Management Agreements entered into with such Person by any Borrower Party, (d) each indemnified party under Section 11.4 in respect of the obligations and liabilities of the Borrower Parties to such Person hereunder and under the other Loan Documents and the Environmental Indemnity Agreement, and (e) their respective successors and (in the case of a Lender, permitted) transferees and assigns.

 

“Security” means all of the real and personal property securing the Obligations.

 

“Security Agreement” means the Security Agreement executed by Borrowers in favor of Administrative Agent (for itself and on behalf of the Secured Parties) covering certain personal property described therein, as amended, restated, supplemented, or otherwise modified from time to time.

 

“Security Deposits” means any and all security deposits and entrance fees from any tenant or occupant of the Projects collected or held by Borrowers or Operators.

 

“Single Purpose Entity” means a Person (other than an individual, a government or any agency or political subdivision thereof), which exists solely for the purpose of owning and leasing the Projects, observes corporate, company or partnership formalities, as applicable, independent of any other entity, and which otherwise complies with the covenants set forth in Section 5.18 hereof.

 

“Site Assessment” means an environmental engineering report for each Project (including without limitation, any phase II engineering report) prepared at Borrowers’ expense by an engineer engaged by Borrowers, or by Administrative Agent on behalf of Borrowers, and reasonably approved by Administrative Agent, based upon an investigation relating to and making appropriate inquiries concerning the existence of Hazardous Materials on or about each Project, and the past or present discharge, disposal, release or escape of any such substances, all consistent with ASTM Standard E1527-05 (or any successor thereto published by ASTM) and good customary and commercial practice.

 

 

“Social Security Act” means 42 U.S.C. 401 et seq., as enacted in 1935, and amended, restated or otherwise supplemented thereafter from time to time and all rules and regulations promulgated thereunder.

 

“Specially Designated National and Blocked Persons” mean those Persons that have been designated by executive order or by the sanction regulations of OFAC as Persons with whom U.S. Persons may not transact business or must limit their interactions to types approved by OFAC.

 

“Special Flood Hazard Area” means an area that FEMA has designated as an area subject to special flood hazards, the current standard for which is at least a one percent (1%) chance of a flood equal to or exceeding the base flood elevation (a 100-year flood) in any given year as per the applicable flood maps.

 

“Specified Oregon Restriction” means that certain Order Imposing License Condition (#RCFCD17-008) concerning the Project known as Ocean Park in Brookings, Oregon, issued by the Oregon Department of Human Services on May 3, 2017, as amended by that certain Stipulated Final Order and Settlement Agreement, dated July 17, 2017, in each case, as in effect on the Closing Date.

 

“Sponsor” means Healthcare Trust Operating Partnership, L.P., a Delaware limited partnership.

 

“SPV” means any special purpose funding vehicle identified as such in a writing by any Lender to Administrative Agent.

 

“State Regulator” means the applicable state department of health or other applicable state or local regulatory agency having jurisdiction over the operation of the Projects.

 

“Subaccount” means a subaccount, which may be ledger or book entry account and not an actual account.

 

“Survey” has the meaning assigned in Schedule 2.1.

 

“Swap Obligation” means, with respect to any Loan Party, any obligation to pay or perform under any agreement, contract or transaction that constitutes a “swap” within the meaning of Section 1a(47) of the Commodity Exchange Act.

 

“Tax Impound” has the meaning assigned in Section 3.5.

 

“Taxes” means all present or future taxes, levies, imposts, duties, deductions, withholdings (including backup withholding), assessments, fees or other charges imposed by any Governmental Authority, including any interest, additions to tax or penalties applicable thereto.

 

“Tenant” means any tenant or occupant of a Project under a Lease, excluding Operating Tenants.

 

 

“Tenant Estoppel Certificates” means any estoppel certificate from a Tenant delivered to Administrative Agent in connection with the Loan.

 

“Test Period” means, as of any date, a period of twelve (12) consecutive calendar months then ended (taken as one accounting period), or such other period as specified in this Agreement.

 

“Third Party Payor” means the payor under a Third Party Payor Program.

 

“Third Party Payor Programs” means any participation or provider agreements, including Medicare, Medicaid, TRICARE and any Approved Insurer, and any other private commercial insurance managed care and employee assistance program, to which any Borrower or any Operator may be subject with respect to any Project.

 

“Title Policy” has the meaning assigned in Schedule 2.1.

 

“Transfer” means any direct or indirect sale, transfer, conveyance, mortgage, grant of lien or other interest, bargain, installment sale, master lease, encumbrance, pledge, assignment, grant of any options with respect to, or any other transfer or disposition of (directly or indirectly, voluntarily or involuntarily, by operation of law or otherwise, and whether or not for consideration or of record) of all or any portion of the direct or indirect legal or beneficial ownership of, or any interest in, (a) the Projects or any part thereof or (b) any Restricted Party including any agreement to transfer or cede to another Person any voting management or approved rights, or any other rights, appurtenant to such legal or beneficial ownership or other interest.

 

“Transferee” has the meaning assigned in Section 7.1(c).

 

“TWEA” has the meaning assigned in Section 5.20(f).

 

“UCC” means the Uniform Commercial Code as from time to time in effect in the State of New York; provided, however, that, in the event that, by reason of mandatory provisions of any applicable Requirement of Law, any of the attachment, perfection or priority of Administrative Agent’s or any other Lender’s security interest in any Collateral is governed by the Uniform Commercial Code of a jurisdiction other than the State of New York, “UCC” shall mean the Uniform Commercial Code as in effect in such other jurisdiction for purposes of the provisions hereof relating to such attachment, perfection or priority and for purposes of the definitions related to or otherwise used in such provisions.

 

“U.S. Person” means any United States citizen, any entity organized under the laws of the United States or its constituent states or territories, or any entity, regardless of where organized, having its principal place of business within the United States or any of its territories.

 

“U.S. Tax Compliance Certificate” has the meaning assigned in Section 2.17(g)(ii)(B)(3).

 

 

“Write-Down and Conversion Powers” means, with respect to any EEA Resolution Authority, the write-down and conversion powers of such EEA Resolution Authority from time to time under the Bail-In Legislation for the applicable EEA Member Country, which write-down and conversion powers are described in the EU Bail-In Legislation Schedule.

 

“Zoning Report” has the meaning assigned in Schedule 2.1.

 

Section 1.2           Definitions. All terms defined in Section 1.1 above or otherwise in this Agreement shall, unless otherwise defined therein, have the same meanings when used in any other Loan Document or Environmental Indemnity Agreement, or any certificate or other document made or delivered pursuant hereto. The words “hereof”, “herein”, and “hereunder” and words of similar import when used in this Agreement shall refer to this Agreement as a whole. The words “include” and “include(s)” when used in this Agreement and the other Loan Documents or Environmental Indemnity Agreement means “include(s), without limitation,” and the word “including” means “including, but not limited to.”

 

Section 1.3           Phrases. When used in this Agreement and the other Loan Documents or Environmental Indemnity Agreement, the phrase “including” shall mean “including, but not limited to,” the phrases “satisfactory to Administrative Agent,” “satisfactory to Lenders” and “satisfactory to Required Lenders” shall mean “in form and substance satisfactory to the applicable Person in all respects”, the phrases “with Administrative Agent’s consent”, “with Lenders’ consent” and “with the Required Lenders’ consent” or “with Administrative Agent’s approval”, “with Lenders’ approval” and “with the Required Lenders’ approval” shall mean such consent or approval at such Person’s sole discretion, and the phrases “acceptable to Administrative Agent,” “acceptable to Lenders” and “acceptable to the Required Lenders” shall mean “acceptable to such Person at such Person’s sole discretion” unless otherwise specified in this Agreement.

 

ARTICLE 2

 

LOAN TERMS

 

Section 2.1           The Loan. Upon satisfaction of all the terms and conditions set forth in Schedule 2.1 attached hereto (which shall be deemed satisfied upon execution of this Agreement and funding of the Loan by Lenders), each Lender severally, but not jointly, agrees to make its Pro Rata Share of the Loan in Dollars to Borrowers in the amount of such Lender’s Loan Commitment, which shall be funded in one advance on the Closing Date and repaid in accordance with the terms of this Agreement and the Notes. Borrowers hereby agree to accept the Loan on the Closing Date, subject to and upon the terms and conditions set forth herein. The aggregate amount of all advances of the Loan on a cumulative basis shall not exceed the total Loan Commitments. The Loan is not a revolving credit loan, and Borrowers are not entitled to any readvances of any portion of the Loan which they may (or are otherwise required to) prepay pursuant to the provisions of this Agreement.

 

 

Section 2.2           Interest Rate; Late Charge. The outstanding principal balance of the Loan shall bear interest at a floating rate of interest equal to the Libor Rate plus two and 50/100 percent (2.50%) per annum (the “Contract Rate”). If Borrowers fail to pay any installment of interest or principal within five (5) days after the date on which the same is due excluding the final installment due on the Maturity Date, Borrowers shall pay to Administrative Agent, for the account of Lenders (other than any Defaulting Lender but subject to Section 2.19(c)), a late charge on such past due amount, as liquidated damages and not as a penalty, equal to five percent (5%) of such amount, but not in excess of the maximum amount of interest allowed by applicable law. Administrative Agent shall pay to each Lender (other than any Defaulting Lender but subject to Section 2.19(c)) its portion of the late charge based on each Lender’s Pro Rata Share of the Loan in accordance with Section 2.6. The foregoing late charge is intended to compensate each Lender for the expenses incident to handling any such delinquent payment and for the losses incurred by each Lender as a result of such delinquent payment. Borrowers agree that, considering all of the circumstances existing on the date this Agreement is executed, the late charge represents a reasonable estimate of the costs and losses each Lender will incur by reason of late payment. Borrowers and each Lender further agree that proof of actual losses would be costly, inconvenient, impracticable and extremely difficult to fix. Acceptance of the late charge shall not constitute a waiver of the Event of Default arising from the overdue installment, and shall not prevent any Lender from exercising any other rights or remedies available to such Lender with respect to such Event of Default. While any Event of Default exists, the Loan shall bear interest at the Default Rate.

 

Section 2.3           Terms of Payment.

 

(a)           Interest.

 

(i)          On the Closing Date, Borrowers shall pay to Administrative Agent for the account of the Lenders, a payment of interest only representing interest that is expected to accrue from the Closing Date through the last day of the month in which the Closing Date occurs, computed at the Contract Rate. Thereafter, commencing on February 1, 2018, and continuing on each Payment Date thereafter through and including the Payment Date immediately prior to the Maturity Date, Borrowers shall pay interest only in arrears computed at the Contract Rate on the outstanding principal balance of the Loan.

 

(ii)         Commencing on the first Payment Date during the Extension Period, and continuing on each Payment Date thereafter and including the Payment Date immediately prior to the Maturity Date, Borrowers shall pay to Administrative Agent for the account of the Lenders (other than a Defaulting Lender): (A) interest in arrears computed at the Contract Rate on the outstanding principal balance of the Loan and (B) installments of principal in accordance with the amortization schedule then provided by the Administrative Agent pursuant to Section 2.3(c) hereof. Each of such payments shall be applied (i) to the payment of interest computed at the Contract Rate and (ii) the balance applied toward reduction of the principal sum of the Loan. The principal payment required hereunder shall be based on a twenty-five (25) year amortization schedule commencing on the first Payment Date during the Extension Period, utilizing a five percent (5%) per annum interest rate.

 

(b)          Maturity Date. On the Maturity Date, Borrowers shall pay to Administrative Agent for the account of Lenders (other than any Defaulting Lender but subject to Section 2.19(c)), all outstanding principal, accrued and unpaid interest, default interest, late charges, the Exit Fee, and any and all other amounts due under the Loan Documents.

 

 

(c)          Extension of Maturity Date. Borrowers shall have the right and option to extend the Maturity Date for one consecutive twelve (12) month period (the “Extension Period”) subject to the conditions for such Extension Period that:

 

(i)          Borrowers shall have notified Administrative Agent in writing of the exercise of the Extension Period no earlier than ninety (90) days nor later than thirty (30) days prior to the then applicable Maturity Date;

 

(ii)         on the date of such written notice and on the date of commencement of the Extension Period:

 

(A)         no Event of Default shall have occurred under any of the Loan Documents or the Environmental Indemnity Agreement and be continuing;

 

(B)         the Debt Yield (based on the trailing six (6) full calendar months most recently ending) shall be at least 1% greater than the Debt Yield then required to be maintained by Borrowers pursuant to Section 7.13(b) hereof; and

 

(C)         the Debt Service Coverage Ratio (based on the trailing six (6) full calendar months most recently ending) shall be at least 1.25:1.00.

 

(iii)        Borrowers shall have delivered to Administrative Agent an updated title report showing no additional exceptions to title other than those permitted by the terms of the Loan Documents or consented to by Administrative Agent.

 

(iv)        [Intentionally omitted].

 

(v)         At the time of the extension, Borrowers shall pay reasonable attorneys’ fees and expenses incurred by Administrative Agent in connection with the extension.

 

Section 2.4          Prepayment.

 

(a)          Right to Prepay. The Loan may be prepaid in whole or in part at any time, provided Borrowers pay with such prepayment all accrued interest and all other outstanding amounts then due and unpaid under the Loan Documents, including, without limitation, Prorated Interest, the Exit Fee, and any Libor Breakage Amount but without any other prepayment penalty or fee.

 

(b)          Prepayment Not Made on a Payment Date. If for any reason the Loan or any portion thereof is prepaid on a day other than a scheduled monthly Payment Date, interest shall be prorated (the “Prorated Interest”) through the date of prepayment. On the prepayment date, Borrowers shall pay to Administrative Agent, for the account of Lenders, as applicable, the applicable principal of the Loan, Prorated Interest, the Exit Fee, Libor Breakage Amount, and any other amounts, if any, required under this Agreement.

 

 

(c)          Involuntary Prepayment. If the Loan is accelerated for any reason other than casualty or condemnation, Borrowers shall pay to Administrative Agent, for the account of Lenders, in addition to all other amounts outstanding under the Loan Documents, including without limitation, Prorated Interest (if applicable), the Libor Breakage Amount (if applicable), and the Exit Fee.

 

(d)          Prepayment Due to Casualty or Condemnation. In the event of a prepayment resulting from the application of insurance or condemnation proceeds pursuant to Article 3 hereof, no Exit Fee shall be imposed and Lenders agree to use commercially reasonable efforts to mitigate and minimize the LIBOR Breakage Amount arising out of such prepayment.

 

(e)          Prepayment Following a Casualty. Following the occurrence of a Casualty at a Project, if Borrowers elect to prepay the Allocated Loan Amount in respect of such Project in accordance with the terms of Section 3.2(d), Borrowers shall (i) provide not less than five (5) days’ notice to Administrative Agent of such prepayment and (ii) pay with such prepayment of the Allocated Loan Amount all accrued interest, including Prorated Interest on the amount being prepaid, but without payment of any Exit Fee or any other prepayment penalty, cost or fee. Concurrently with the completion of the prepayment, and provided that Borrowers otherwise satisfy the requirements of Section 2.18 with respect to Partial Releases (other than payment of the Partial Release Price and other than Sections 2.18(a)(iv)), Administrative Agent and Lenders shall (i) release and discharge the Project from the Mortgage and the other documents securing the Loan (or assign the same at the request of Borrower) and the Assignment of Ownership Interests Agreement with respect to the applicable Borrowers, (ii) release and discharge Borrower from its obligations under the Loan Documents, except for those obligations that expressly survive the repayment of the Obligations under this Agreement, the other Loan Documents and the Environmental Indemnity, and (iii) execute and deliver all instruments reasonably required to effect such release and discharge (or assignment). Borrowers shall also pay all reasonable out of pocket expenses incurred by Administrative Agent and Lenders in connection with the prepayment and the release and discharge of the Project from the Mortgage (or the assignment of the applicable Mortgages).

 

(f)           Character of Exit Fee. The Exit Fee does not constitute a penalty, but rather represents the reasonable estimate, agreed to between Borrowers and each Lender, of fair compensation for the loss that may be sustained by such Lender due to the payment of the principal Indebtedness of Borrowers prior to the Maturity Date and/or the increased cost and expense to such Lender resulting from an acceleration of the Loan. Any Exit Fee shall be paid without prejudice to the right of any Lender to collect on its behalf any of the amounts owing under the Note, this Agreement or the other Loan Documents or otherwise, to enforce any of its rights or remedies arising out of an Event of Default.

 

Section 2.5           Security; Establishment of Funds; Deposit Accounts.

 

(a)          Security. The Loan shall be secured by the Mortgage, creating a first lien on Borrowers’ fee interests in the Projects, and the other Loan Documents.

 

(b)          Establishment of Funds. Borrowers agree to establish the following reserves or escrows with Administrative Agent, to be held by Administrative Agent as further security for the Loan subject to the terms hereto:

 

 

(i)          on the Closing Date, Borrowers shall deposit with Administrative Agent the amount of $146,160.00 (the “Required Repair Fund”) which shall be held by Administrative Agent for the completion of the required repairs set forth on Schedule 11.37 annexed hereto (the “Required Repairs”) on or before the date(s) specified in Schedule 11.37. Borrowers shall provide Administrative Agent with evidence reasonably satisfactory to Administrative Agent of the completion of the Required Repairs, all of which shall be performed in a manner reasonably satisfactory to Administrative Agent and in accordance with all applicable Requirements of Law; and

 

(ii)         Borrowers shall deposit with Administrative Agent on each Payment Date, the product of Thirty and No/100 Dollars ($30) multiplied by the number of Residential Units in the Projects, which shall be held and disbursed by Administrative Agent for replacements and repairs required to be made to the Projects during the term of the Loan (the “Replacement Escrow Fund”).

 

Administrative Agent shall hold the Funds for the benefit of all Lenders subject to the terms hereof.

 

(c)          Pledge and Disbursement of Funds. Borrowers hereby pledge to Administrative Agent and Lenders, and grant a security interest in, any and all monies now or hereafter deposited in the Funds as additional security for the payment of the Loan. Administrative Agent may reasonably reassess its estimate of the amount necessary for the Funds from time to time and may reasonably adjust the monthly amounts required to be deposited into the Funds upon thirty (30) days’ notice to Borrowers. Administrative Agent shall make disbursements from the Funds as requested by Borrowers, and approved by Administrative Agent in its reasonable discretion, on a monthly basis in increments of no less than $5,000.00 not later than ten (10) days following delivery by Borrowers of Administrative Agent’s standard form of draw request, accompanied by copies of invoices for the amounts requested and, if reasonably required by Administrative Agent, conditional lien waivers and releases from all parties furnishing materials and/or services in connection with the requested payment (which waivers and releases may be subject to receipt of the dollars being requested). If Borrower makes a request for disbursement of Funds in excess of $25,000, Administrative Agent may require an inspection of the applicable Projects at Borrowers’ expense prior to making a disbursement in order to verify completion of replacements and repairs for which reimbursement is sought. Lenders and Borrowers acknowledge and agree that the Funds shall be held without interest in Administrative Agent’s name or in the name of CONA as an Affiliate of Administrative Agent and may be commingled with the general funds of Administrative Agent. Upon the occurrence and continuation of an Event of Default, Administrative Agent may (and at the direction of the Required Lenders shall) apply any sums then present in the Funds to the payment of the Loan in any order in the reasonable discretion of Administrative Agent. Until expended or applied as above provided, the Funds shall constitute additional security for the Loan. Administrative Agent shall have no obligation to release any of the Funds while any Event of Default exists or any Material Adverse Change has occurred in any Borrower or any other Borrower Party or any Project. All costs and expenses, if any, incurred by Administrative Agent in the disbursement of any of the Funds shall be paid by Borrowers promptly upon demand or, at Administrative Agent’s sole discretion, deducted from the Funds. Any amounts remaining in the Funds at the time of payment and performance in full of the Obligations or, if earlier, completion of all Required Repairs solely with respect to the Required Repair Fund so long as no Potential Default or Event of Default exists, shall be promptly disbursed to Borrowers; provided, however the requirement for no Potential Default to exist may be waived by Administrative Agent in its sole discretion for Potential Non-Monetary Defaults.

 

 

(d)          Deposit Accounts. From and after the Closing Date, all income for each Project must be deposited into a bank account in the name of and under the sole control of the Operating Tenant for such Project or the Borrower with respect to such Project (each a “Project Account”). After the Closing Date as a Post-Closing Obligation pursuant to the provisions of Section 7.21 of this Agreement, Borrowers shall open (and thereafter maintain) a Deposit Account with CONA, which account shall be subject to Deposit Account Control Agreement and be in the name of one of the Borrowers (the “CONA Account”). From and after the opening of the CONA Account, subject to the next sentence, (x) Borrowers shall cause the Operators of each Project to deliver all rents and other income from such Project remaining in the Project Account after payment of current operating expenses for the Project for any particular month (which expenses must be incurred in the ordinary course of business consistent with prudent business practices with respect to such Project) to the CONA Account at least once every thirty (30) calendar days and (y) the Borrower maintaining the CONA Account shall, in its sole discretion but subject to the terms of the Lender Cash Management Agreement with respect to such CONA Account, have the right to cause all funds in the CONA Account to be swept from such CONA Account on a daily (or, at its option, on a less frequent) basis and used for any purposes not prohibited by the terms of this Agreement. Notwithstanding the foregoing, during the continuation of an Event of Default, (i) Borrowers shall cause the Operators to deliver funds in each Project Account to the CONA Account within five (5) Business Days of receipt of such funds by the applicable Operator and (ii) subject to the terms of any applicable Deposit Account Control Agreement, the Deposit Account Bank may stop taking direction from Borrower Party with respect to the disposition of funds in the CONA Account and shall disburse the funds therein instead only at the direction of Administrative Agent.

 

Section 2.6           Application of Payments.

 

(a)          Payments Following an Event of Default. Upon the occurrence and during the continuance of an Event of Default, all payments shall be applied in such order as Administrative Agent shall determine in its sole discretion or as directed by the Required Lenders. Notwithstanding anything herein to the contrary, if at any time during the existence of an Event of Default, Administrative Agent applies any payments received or the proceeds of any Collateral to principal payments on the Loan, Administrative Agent shall apply such payments or proceeds pro rata between such principal on the Loan and the Obligations under the Secured Hedge Agreements, if any, based on the outstanding principal balance of the Loan and the Obligations under the Secured Hedge Agreements.

 

(b)          Application of Payments Generally. All repayments of the Loan shall be applied to reduce the remaining installments of the outstanding principal amount of the Loan in the inverse order of maturity (together with accrued interest thereon as applicable).

 

 

(c)          Payments and Computations. Borrowers shall make each payment under any Loan Document not later than 2:00 p.m. (Eastern Standard or Daylight Savings time) on the day when due to Administrative Agent by wire transfer or Automated Clearing House (“ACH”) transfer to be initiated by Administrative Agent (which shall be the exclusive means of payment hereunder) to the following account (or at such other account or by such other means to such other address as Administrative Agent shall have notified Borrowers in writing within a reasonable time prior to such payment) in immediately available Dollars and without setoff or counterclaim:

 

Bank:          Capital One, N.A.

ABA/Routing Number:          065000090

Account Name:          CLS Specialty Finance

Account Number:          38395-100002129

Reference:          HTI Bridge Portfolio

 

Administrative Agent shall cause to be distributed immediately available funds relating to the payment of principal, interest or fees to Lenders, in accordance with the application of payments set forth in Section 2.6(a), promptly after receipt or deemed receipt, but not later than one Business Day following receipt (or deemed receipt) by Administrative Agent. Administrative Agent shall have no obligation to make any payments to a Lender except out of amounts received or applied by Administrative Agent with respect to the Loan, and only if and to the extent payable in accordance with said Section 2.6(a). Payments received by Administrative Agent after 2:00 p.m. (Eastern Standard or Daylight Savings time) shall be deemed to be received on the next Business Day.

 

(d)          Computations of Interests and Fees. All computations of interest and of fees shall be made by Administrative Agent on the basis of a fraction, the denominator of which is three hundred sixty (360) and the numerator of which is the actual number of days elapsed from the date of the initial disbursement under the Loan or the date of the preceding Payment Date, as the case may be, to the date of the next Payment Date or the Maturity Date, as the case may be. Each determination of an interest rate or the amount of a fee hereunder shall be made by Administrative Agent in its reasonable discretion and shall be conclusive, binding and final for all purposes, absent manifest error.

 

(e)          Payment Dates. Whenever any payment hereunder shall be stated to be due on a day other than a Business Day, the due date for such payment shall be extended to the next succeeding Business Day without any increase in such payment as a result of additional interest or fees.

 

(f)           Advancing Payments. Unless Administrative Agent shall have received notice from Borrowers prior to the date on which any payment is due hereunder that Borrowers will not make such payment in full, Administrative Agent may assume that Borrowers has made such payment in full to Administrative Agent on such date and Administrative Agent may, in reliance upon such assumption, cause to be distributed to each Lender on such due date an amount equal to the amount then due such Lender. If and to the extent that Borrowers shall not have made such payment in full to Administrative Agent, each Lender shall repay to Administrative Agent on demand such amount distributed to such Lender together with interest thereon (at the Federal Funds Rate) for each day from the date such amount is distributed to such Lender until the date such Lender repays such amount to Administrative Agent.

 

 

Section 2.7          Sources and Uses. The Loan will be disbursed on the Closing Date as provided in the executed loan disbursement instructions delivered to the Administrative Agent on or about the Closing Date. Borrowers shall deliver such information and documentation as Administrative Agent reasonably shall request to verify the disbursements described in such loan disbursement instructions. The proceeds of the Loan are intended and will be used for agricultural, business and/or commercial purposes and are not intended and will not be used for personal, family or household purposes.

 

Section 2.8           Increased Costs.

 

(a)          Increased Costs Generally. If any Change in Law shall:

 

(i)          impose, modify or deem applicable any reserve, special deposit, compulsory loan, insurance charge or similar requirement against assets of, deposits with or for the account of, or credit extended or participated in by, any Lender;

 

(ii)         subject any Recipient to any Taxes (other than (A) Indemnified Taxes, (B) Taxes described in clauses (b) through (d) of the definition of Excluded Taxes and (C) Connection Income Taxes) on its loans, loan principal, letters of credit, commitments, or other obligations, or its deposits, reserves, other liabilities or capital attributable thereto; or

 

(iii)        impose on any Lender or the London interbank market any other condition, cost or expense (other than Taxes) affecting this Agreement or Loan made by such Lender;

 

and the result of any of the foregoing shall be to increase the cost to such Lender or such other Recipient of making, converting to, continuing or maintaining any Loan or of maintaining its obligation to make any such Loan, or to increase the cost to such Lender, or to reduce the amount of any sum received or receivable by such Lender or other Recipient hereunder (whether of principal, interest or any other amount) then, upon request of such Lender or other Recipient, Borrowers will pay to such Lender or other Recipient, as the case may be, such additional amount or amounts as will compensate such Lender, or other Recipient, as the case may be, for such additional costs incurred or reduction suffered.

 

(b)          Capital Requirements. If any Lender determines that any Change in Law affecting such Lender or any lending office of such Lender’s holding company, if any, regarding capital or liquidity requirements, has or would have the effect of reducing the rate of return on such Lender’s capital or on the capital of such Lender’s holding company, if any, as a consequence of this Agreement, the Loan Commitment of such Lender or the Loan made by such Lender, to a level below that which such Lender or such Lender’s holding company could have achieved but for such Change in Law (taking into consideration such Lender’s policies and the policies of such Lender’s holding company with respect to capital adequacy), then from time to time Borrowers will pay to such Lender such additional amount or amounts as will compensate such Lender or such Lender’s holding company for any such reduction suffered.

 

 

(c)          Certificates for Reimbursement. A certificate of a Lender setting forth the amount or amounts necessary to compensate such Lender or its holding company, as the case may be, as specified in Sections 2.8(a) or (b) and delivered to Borrowers, shall be conclusive absent manifest error. Borrowers shall pay such Lender the amount shown as due on any such certificate within 10 days after receipt thereof.

 

(d)          Delay in Requests. Failure or delay on the part of any Lender to demand compensation pursuant to this Section shall not constitute a waiver of such Lender’s right to demand such compensation; provided that Borrowers shall not be required to compensate a Lender pursuant to this Section for any increased costs incurred or reductions suffered more than 180 days prior to the date that such Lender notifies Borrowers of the Change in Law giving rise to such increased costs or reductions, and of such Lender’s intention to claim compensation therefor (except that, if the Change in Law giving rise to such increased costs or reductions is retroactive, then the 180-day period referred to above shall be extended to include the period of retroactive effect thereof).

 

Section 2.9           Illegality; Market Disruption Event.

 

(a)          Illegality. If any Lender determines in good faith that any Change in Law has made it unlawful, or any Governmental Authority has asserted that it is unlawful, for any Lender to maintain loans or any Governmental Authority has imposed material restrictions on the authority of such Lender to purchase or sell, or to take deposits of, Dollars in the London interbank Eurodollar market, then (a) such Lender shall promptly notify the Borrower Representative thereof (with a copy to Administrative Agent) and (b) if such Change in Law or such restrictions shall so mandate, such Lender’s Loan shall be prepaid by Borrowers, together with accrued and unpaid interest thereon and all other amounts payable with respect thereto by Borrowers under this Agreement (but without any Exit Fee), on or before such date as shall be mandated by such Change in Law or such restrictions, to Administrative Agent for the account of such Lender, on the last day of the then current Interest Period for such Loan (or on such earlier date as shall be notified to by Lender as being the last permissible date for such prepayment under the relevant applicable Law) but in all events no sooner than sixty (60) days after Administrative Agent’s request for such prepayment; provided, that, (i) in the event that such Lender has notified the Borrower Representative that it is not unlawful for such Lender to maintain any Loan accruing interest at a rate determined by reference to the Base Rate, the portion of the Loan held by such Lender bearing interest at the Contract Rate will automatically at the end of the Libor Interest Period during which such notice is delivered to Borrower Representative, convert to bearing interest at the Base Rate, and (ii) the obligation of such Lender to make or maintain loans bearing interest at the Contract Rate shall be suspended, in each case until Administrative Agent shall notify the Borrower Representative that such Lender has determined that the circumstances causing such suspension no longer exist (of which cessation each such Lender agrees to promptly notify Administrative Agent).

 

(b)          Market Disruption Event. If, on or prior to the first day of any Interest Period (an “Affected Interest Period”):

 

(i)          Administrative Agent determines (which determination shall be made in good faith and be conclusive and binding on Borrowers absent manifest error) that, by reason of circumstances affecting the London interbank Eurodollar market, the “LIBOR Rate” cannot be determined pursuant to the definition thereof, or

 

 

(ii)         Administrative Agent and the Required Lenders determine in good faith that for any reason in connection with any request for a Loan bearing interest at the Contract Rate or a continuation thereof that (A) Dollar deposits are not being offered to banks in the London interbank Eurodollar market for the applicable amount and Interest Period of such Loan bearing interest at the Contract Rate, or (B) the LIBOR Rate for any requested Interest Period with respect to a proposed Loan bearing interest at the Contract Rate does not adequately and fairly reflect the cost to such Lenders of funding such Loan, then Administrative Agent will promptly so notify the Borrower Representative and each Lender. Thereafter, the obligation of Lenders to maintain its Loan bearing interest at the Contract Rate shall be suspended at the end of the Libor Interest Period in which Administrative Agent so notifies the Borrower Representative until Administrative Agent (upon the instruction of the Required Lenders) revokes such notice. During any period for which Administrative Agent has notified Borrower Representative that use of the Contract Rate has been suspended, the Loan will accrue interest at the Base Rate. Upon receipt Administrative Agent’s notice that use of the Contract Rate is to be suspended, the Borrower Representative may revoke any pending request for a continuation of interest accruing at the Contract Rate and will be deemed to have converted such request into a request for the Loan to bear interest at the Base Rate.

 

Section 2.10        Secured Hedge Agreement. Notwithstanding anything to the contrary herein, as of the Closing Date, no Borrower Party nor any Affiliate of any of them has entered into any Secured Hedge Agreement or hedge product or facility in connection with the Loan. Further, nothing in any of the Loan Documents as in effect on the Closing Date require any Borrower Party or any Affiliate of any of them to enter into any Secured Hedge Agreement or other hedge product or facility in connection with the Loan at any time, but any of them may, in its sole discretion, enter into such an agreement or facility.

 

Section 2.11         Libor Breakage Amount. Upon any payment of the Loan (or any portion thereof) on any day that is not the last day of the Libor Interest Period applicable thereto (regardless of the source of such prepayment and whether voluntary, by acceleration or otherwise), Borrowers shall pay to Administrative Agent, for the account of Lenders (other than a Defaulting Lender) the Libor Breakage Amount. For purposes of calculating the Libor Breakage Amount payable to a Lender under this Section 2.11, each Lender shall be deemed to have actually funded the Loan through the purchase of a deposit bearing interest at the Libor Rate in an amount equal to the amount of the Loan and having a maturity and repricing characteristics comparable to the relevant Libor Interest Period; provided, however, that each Lender may fund its Pro Rata Share of the Loan in any manner it sees fit, and the foregoing assumption shall be utilized only for the calculation of amounts payable under this Section 2.11.

 

Section 2.12         Evidence of Debt; Loan Accounts.

 

(a)          Administrative Agent, on behalf of Lenders, shall record on its books and records the amount of each Loan made, the interest rate applicable, all payments of principal and interest thereon and the principal balance thereof from time to time outstanding. Administrative Agent shall deliver to the Borrower Representative on a monthly basis a loan statement setting forth such record for the immediately preceding calendar month. Such record shall, absent manifest error, be conclusive evidence of the amount of the Loan made by Lenders to Borrowers and the interest and payments thereon. Any failure to so record or any error in doing so, or any failure to deliver such loan statement shall not, however, limit or otherwise affect the obligation of Borrowers hereunder (and under any Note) to pay any amount owing with respect to the Loan or provide the basis for any claim against Administrative Agent.

 

 

(b)          Administrative Agent, acting as a non-fiduciary agent of Borrowers solely for tax purposes and solely with respect to the actions described in this Section 2.12(b), shall establish and maintain at its address referred to in Section 11.1 (or at such other address as Administrative Agent may notify the Borrower Representative) (A) a record of ownership (the “Register”) in which Agent agrees to register by book entry the interests (including any rights to receive payment hereunder) of Administrative Agent and each Lender, each of their obligations under this Agreement to participate in each Loan, and any assignment of any such interest, obligation or right and (B) accounts in the Register in accordance with its usual practice in which it shall record (1) the names and addresses of Lenders (and each change thereto pursuant to Sections 11.1 and 11.3), (2) the Commitments of each Lender, (3) the amount of each Loan and each funding of any participation described in clause (A) above, (4) the amount of any principal or interest due and payable or paid and (5) any other payment received by Administrative Agent from a Borrower and its application to the Obligations.

 

(c)          Notwithstanding anything to the contrary contained in this Agreement, the Loan (including any Notes evidencing the Loan) is a registered obligation. The right, title and interest of Lenders and their assignees in and to such Loan shall be transferable only upon notation of such transfer in the Register and no assignment thereof shall be effective until recorded therein. This Section 2.12 and Section 11.1 shall be construed so that the Loan is at all times maintained in “registered form” within the meaning of Sections 163(f), 871(h)(2) and 881(c)(2) of the Code.

 

(d)          The Borrower Parties, Administrative Agent and Lenders shall treat each Person whose name is recorded in the Register as a Lender for all purposes of this Agreement. Information contained in the Register with respect to any Lender shall be available for access by Borrowers, the Borrower Representative, Administrative Agent or such Lender during normal business hours and from time to time upon at least one Business Day’s prior notice. No Lender shall, in such capacity, have access to or be otherwise permitted to review any information in the Register other than information with respect to such Lender or unless otherwise agreed by Administrative Agent.

 

Section 2.13         [Reserved].

 

Section 2.14         Mitigation Obligations; Replacement of Lenders.

 

(a)          Mitigation Obligations. If any Lender requests compensation under Section 2.8 or Section 2.9, or any Borrower is required to pay any additional amount to any Lender or any Governmental Authority for the account of any Lender pursuant to Section 2.17, then such Lender shall (at the request of the Borrower Representative) use reasonable efforts to designate a different lending office for funding or booking its Loan hereunder or to assign its rights and obligations hereunder to another of its offices, branches or affiliates, if, in the judgment of such Lender, such designation or assignment (i) would eliminate or reduce amounts payable pursuant to Sections 2.17, 2.8 or 2.9, as the case may be, in the future, and (ii) would not subject such Lender to any unreimbursed cost or expense and would not otherwise be disadvantageous to such Lender. Borrowers hereby agree to pay all reasonable costs and expenses incurred by any Lender in connection with any such designation or assignment.

 

 

(b)          Replacement of Lenders. If any Lender requests compensation under Sections 2.8 or 2.9, or requires any Borrower to pay any additional amount to any Lender or any Governmental Authority for the account of any Lender pursuant to Section 2.17 and, in each case, such Lender has declined or is unable to designate a different lending office in accordance with Section 2.14(a), or if any Lender is a Defaulting Lender, then Borrowers may, at their sole expense, upon notice to such Lender and Agent, require such Lender to assign and delegate, without recourse (in accordance with and subject to the restrictions contained in, and consents required by, Section 11.3), all of its interests, rights (other than its existing rights to payments pursuant to Sections 2.8 or 2.9) and obligations under this Agreement and the related Loan Documents to an Eligible Assignee under Section 11.3 that shall assume such obligations (which assignee may be another Lender, if a Lender accepts such assignment); provided that:

 

(i)          Borrowers shall have paid to Agent the assignment fee (if any) specified in Section 11.3;

 

(ii)         such assigning Lender shall have received payment of an amount equal to the outstanding principal of its portion of the Loan and accrued interest thereon, accrued fees and all other amounts payable to it hereunder and under the other Loan Documents in connection therewith (including, without limitation, any LIBOR Breakage Amount except where such assignment is of a Defaulting Lender’s interest or the assigning Lender declined to designate a different lending office despite having the ability to do so) from the assignee (to the extent of such outstanding principal and accrued interest and fees) or Borrowers (in the case of any applicable Libor Breakage Amount or Exit Fee);

 

(iii)        in the case of any such assignment resulting from a claim for compensation under Section 2.13, or payments required to be made pursuant to Section 2.17, such assignment will result in a concomitant reduction in such compensation or payments thereafter; and

 

(iv)        such assignment does not conflict with Requirements of Law.

 

A Lender shall not be required to make any such assignment or delegation if, prior thereto, as a result of a waiver by such Lender or otherwise, the circumstances entitling Borrowers to require such assignment and delegation cease to apply.

 

Section 2.15         Pro Rata Treatment; Sharing of Payments.

 

(a)          Pro Rata Treatment. (i) The advance of the Loan from Lenders under Section 2.1 and each advance under Section 9.2((b), shall be made by Lenders based on their Pro Rata Share; (ii) each payment or prepayment of principal of the Loan by Borrowers shall be made for account of Lenders based on their Pro Rata Share; and (iii) each payment of interest on the Loan by Borrowers shall be made for account of Lenders pro rata in accordance with the amounts of interest on such Loan then due and payable to the respective Lenders.

 

 

(b)          Sharing of Payments, Etc.

 

(i)          If any Lender shall obtain from any Borrower payment of any principal of or interest on the Loan owing or payment of any other amount under this Agreement or any other Loan Document through the exercise of any right of set off, banker’s lien or counterclaim or similar right or otherwise (other than from Administrative Agent as provided herein), and, as a result of such payment, such Lender shall have received a greater percentage of the principal of or interest on the Loan or such other amounts then due hereunder or thereunder by Borrowers to such Lender (other than pursuant to any Secured Hedge Agreements) than the percentage received by any other Lender, it shall promptly purchase from such other Lenders participations in (or, if and to the extent specified by such Lender, direct interests in) the Loan or such other amounts, respectively, owing to such other Lenders (or in interest due thereon, as the case may be) in such amounts, and make such other adjustments from time to time as shall be equitable, to the end that all Lenders shall share the benefit of such excess payment (net of any expenses that may be incurred by such Lender in obtaining or preserving such excess payment) pro rata in accordance with the unpaid principal of or interest on the Loan or such other amounts, respectively, owing to each of Lenders. To such end, all Lenders shall make appropriate adjustments among themselves (by the resale of participations sold or otherwise) if such payment is rescinded or must otherwise be restored.

 

(ii)         Borrowers agree that any Lender so purchasing such a participation (or direct interest) may exercise all rights of set off, banker’s lien, counterclaim or similar rights with respect to such participation as fully as if such Lender were a direct holder of the Loan or other amounts (as the case may be) owing to such Lender in the amount of such participation.

 

(iii)        Nothing contained herein shall require any Lender to exercise any such right or shall affect the right of any Lender to exercise, and retain the benefits of exercising, any such right with respect to any other indebtedness or obligation of Borrowers. If, under any applicable bankruptcy, insolvency or other similar law, any Lender receives a secured claim in lieu of a set off to which this Section 2.15(b) applies, such Lender shall, to the extent practicable, exercise its rights in respect of such secured claim in a manner consistent with the rights of Lenders entitled under this Section 2.15(b) to share in the benefits of any recovery on such secured claim.

 

Section 2.16         Fees. Borrowers shall pay to Administrative Agent for its own account fees in the amounts and at the times specified in the Fee Letter; provided, that such fees shall be fully earned when paid and shall not be refundable for any reason whatsoever.

 

 

Section 2.17         Taxes.

 

(a)          Defined Terms. For purposes of this Section 2.17, the term “Requirements of Law” includes FATCA.

 

(b)          Payments Free of Taxes. Any and all payments by or on account of any obligation of any Borrower Party under any Loan Document shall be made without deduction or withholding for any Taxes, except as required by Requirements of Law. If any Requirements of Law (as determined in the good faith discretion of an applicable withholding agent) requires the deduction or withholding of any Tax from any such payment by Administrative Agent or a Borrower Party, then Administrative Agent or such Borrower Party shall be entitled to make such deduction or withholding and shall timely pay the full amount deducted or withheld to the relevant Governmental Authority in accordance with Requirements of Law and, if such Tax is an Indemnified Tax, then the sum payable by the applicable Borrower Party shall be increased as necessary so that after such deduction or withholding has been made (including such deductions and withholdings applicable to additional sums payable under this Section) the applicable Recipient receives an amount equal to the sum it would have received had no such deduction or withholding been made.

 

(c)          Payment of Other Taxes by the Borrower Parties. The Borrower Parties shall timely pay to the relevant Governmental Authority in accordance with Requirements of Law, or at the option of Administrative Agent timely reimburse it for the payment of, any Other Taxes.

 

(d)          Indemnification by Borrower. The Borrower Parties shall jointly and severally indemnify each Recipient, within ten (10) days after demand therefor, for the full amount of any Indemnified Taxes (including Indemnified Taxes imposed or asserted on or attributable to amounts payable under this Section) payable or paid by such Recipient or required to be withheld or deducted from a payment to such Recipient and any reasonable expenses arising therefrom or with respect thereto, whether or not such Indemnified Taxes were correctly or legally imposed or asserted by the relevant Governmental Authority. A certificate as to the amount of such payment or liability delivered to the Borrower Parties by a Lender (with a copy to Administrative Agent), or by Administrative Agent on its own behalf or on behalf of a Lender, setting forth in reasonable detail the manner in which such amount was determined, shall be conclusive absent manifest error.

 

(e)          Indemnification by Lenders. Each Lender shall severally indemnify Administrative Agent, within ten (10) days after demand therefor, for (i) any Indemnified Taxes attributable to such Lender (but only to the extent that any Borrower Party has not already indemnified Administrative Agent for such Indemnified Taxes and without limiting the obligation of the Borrower Parties to do so), (ii) any Taxes attributable to such Lender’s failure to comply with the provisions of Section 11.3 relating to the maintenance of a Participant Register and (iii) any Excluded Taxes attributable to such Lender, in each case, that are payable or paid by Administrative Agent in connection with any Loan Document, and any reasonable expenses arising therefrom or with respect thereto, whether or not such Taxes were correctly or legally imposed or asserted by the relevant Governmental Authority. A certificate as to the amount of such payment or liability delivered to any Lender by Administrative Agent shall be conclusive absent manifest error. Each Lender hereby authorizes Administrative Agent to set off and apply any and all amounts at any time owing to such Lender under any Loan Document or otherwise payable by Administrative Agent to Lender from any other source against any amount due to Administrative Agent under this Section 2.17.

 

 

(f)           Evidence of Payments. As soon as practicable after any payment of Taxes by any Borrower Party to a Governmental Authority pursuant to this Section 2.17, such Borrower Party shall deliver to Administrative Agent the original or a certified copy of a receipt issued by such Governmental Authority evidencing such payment, a copy of the return reporting such payment or other evidence of such payment reasonably satisfactory to Administrative Agent.

 

(g)          Status of Lenders.

 

(i)          Any Lender and Administrative Agent (if not also a Lender) that is entitled to an exemption from or reduction of withholding Tax with respect to payments made under any Loan Document shall deliver to Borrowers and Administrative Agent, at the time or times reasonably requested by Borrowers or Administrative Agent, such properly completed and executed documentation reasonably requested by Borrowers or Administrative Agent as will permit such payments to be made without withholding or at a reduced rate of withholding. In addition, any Lender and Administrative Agent (if not also a Lender), if reasonably requested by Borrowers or Administrative Agent, shall deliver such other documentation prescribed by Requirements of Law or reasonably requested by Borrowers or Administrative Agent as will enable Borrowers or Administrative Agent to determine whether or not such Lender is subject to backup withholding or information reporting requirements. Notwithstanding anything to the contrary in the preceding two sentences, the completion, execution and submission of such documentation (other than such documentation set forth in clauses (ii)(A), (ii)(B) and (ii)(D) below) shall not be required if in Lender’s reasonable judgment such completion, execution or submission would subject such Lender to any material unreimbursed cost or expense or would materially prejudice the legal or commercial position of such Lender.

 

(ii)         Without limiting the generality of the foregoing, if any Borrower is a U.S. Person,

 

(A)         any Lender that is a U.S. Person and Administrative Agent (if not also a Lender) shall deliver to Borrowers and Administrative Agent on or prior to the date on which such person becomes a Lender or Administrative Agent (if not also a Lender) hereunder (and from time to time thereafter upon the reasonable request of Borrowers or Administrative Agent), executed copies of IRS Form W-9 certifying that such person is exempt from U.S. federal backup withholding tax;

 

(B)         any Foreign Lender shall, to the extent it is legally entitled to do so, deliver to Borrowers and Administrative Agent (in such number of copies as shall be requested by the recipient) on or prior to the date on which such Foreign Lender becomes a Lender hereunder (and from time to time thereafter upon the reasonable request of Borrowers or Administrative Agent), whichever of the following is applicable:

 

 

(1)         in the case of a Foreign Lender claiming the benefits of an income tax treaty to which the United States is a party (x) with respect to payments of interest under any Loan Document, executed copies of IRS Form W-8BEN or IRS Form W-8BEN-E, as applicable, establishing an exemption from, or reduction of, U.S. federal withholding Tax pursuant to the “interest” article of such tax treaty and (y) with respect to any other applicable payments under any Loan Document, IRS Form W-8BEN or IRS Form W-8BEN-E, as applicable, establishing an exemption from, or reduction of, U.S. federal withholding Tax pursuant to the “business profits” or “other income” article of such tax treaty

 

(2)         executed copies of IRS Form W-8ECI;

 

(3)         in the case of a Foreign Lender claiming the benefits of the exemption for portfolio interest under Section 881(c) of the Code, (x) a certificate substantially in form reasonably acceptable to Administrative Agent to the effect that such Foreign Lender is not a “bank” within the meaning of Section 881(c)(3)(A) of the Code, a “10 percent shareholder” of any Borrower within the meaning of Section 881(c)(3)(B) of the Code, or a “controlled foreign corporation” described in Section 881(c)(3)(C) of the Code (a “U.S. Tax Compliance Certificate”) and (y) executed copies of IRS Form W-8BEN or IRS Form W-8BEN-E, as applicable; or

 

(4)         to the extent a Foreign Lender is not the beneficial owner, executed copies of IRS Form W-8IMY, accompanied by IRS Form W-8ECI, IRS Form W-8BEN, or IRS Form W-8BEN-E, as applicable, a U.S. Tax Compliance Certificate substantially in the form reasonably acceptable to Administrative Agent, IRS Form W-9, and/or other certification documents from each beneficial owner, as applicable; provided that if the Foreign Lender is a partnership and one or more direct or indirect partners of such Foreign Lender are claiming the portfolio interest exemption, such Foreign Lender may provide a U.S. Tax Compliance Certificate substantially in the form reasonably acceptable to Administrative Agent on behalf of each such direct and indirect partner;

 

(C)         any Foreign Lender shall, to the extent it is legally entitled to do so, deliver to Borrowers and Administrative Agent (in such number of copies as shall be requested by the recipient) on or prior to the date on which such Foreign Lender becomes a Lender under this Agreement (and from time to time thereafter upon the reasonable request of Borrowers or Administrative Agent), executed copies of any other form prescribed by Requirements of Law as a basis for claiming exemption from or a reduction in U.S. federal withholding Tax, duly completed, together with such supplementary documentation as may be prescribed by Requirements of Law to permit Borrowers or Administrative Agent to determine the withholding or deduction required to be made; and

 

 

(D)         if a payment made to a Lender under any Loan Document would be subject to U.S. federal withholding Tax imposed by FATCA if such Lender were to fail to comply with the applicable reporting requirements of FATCA (including those contained in Section 1471(b) or 1472(b) of the Code, as applicable), such Lender shall deliver to Borrowers and Administrative Agent at the time or times prescribed by law and at such time or times reasonably requested by Borrowers or Administrative Agent such documentation prescribed by Requirements of Law (including as prescribed by Section 1471(b)(3)(C)(i) of the Code) and such additional documentation reasonably requested by Borrowers or Administrative Agent as may be necessary for Borrowers and Administrative Agent to comply with their obligations under FATCA and to determine that such Lender has complied with such Lender’s obligations under FATCA or to determine the amount to deduct and withhold from such payment. Solely for purposes of this clause (D), “FATCA” shall include any amendments made to FATCA after the date of this Agreement.

 

Each Lender agrees that if any form or certification it previously delivered expires or becomes obsolete or inaccurate in any respect, it shall update such form or certification or promptly notify Borrowers and Administrative Agent in writing of its legal inability to do so.

 

(h)          Treatment of Certain Refunds. If any party determines, in its sole discretion exercised in good faith, that it has received a refund of any Taxes as to which it has been indemnified pursuant to this Section 2.17 (including by the payment of additional amounts pursuant to this Section 2.17), it shall pay to the indemnifying party an amount equal to such refund (but only to the extent of indemnity payments made under this Section with respect to the Taxes giving rise to such refund), net of all out-of-pocket expenses (including Taxes) of such indemnified party and without interest (other than any interest paid by the relevant Governmental Authority with respect to such refund). Such indemnifying party, upon the request of such indemnified party, shall repay to such indemnified party the amount paid over pursuant to this Section 2.17(h) (plus any penalties, interest or other charges imposed by the relevant Governmental Authority) if such indemnified party is required to repay such refund to such Governmental Authority. Notwithstanding anything to the contrary in this Section 2.17(h), in no event will the indemnified party be required to pay any amount to an indemnifying party pursuant to this Section 2.17(h) the payment of which would place the indemnified party in a less favorable net after-Tax position than the indemnified party would have been in if the Tax subject to indemnification and giving rise to such refund had not been deducted, withheld or otherwise imposed and the indemnification payments or additional amounts with respect to such Tax had never been paid. This Section 2.17(h) shall not be construed to require any indemnified party to make available its Tax returns (or any other information relating to its Taxes that it deems confidential) to the indemnifying party or any other Person.

 

(i)          Survival. Each party’s obligations under this Section 2.17 shall survive the resignation or replacement of Administrative Agent or any assignment of rights by, or the replacement of, a Lender, the termination of the Loan Commitments and the repayment, satisfaction or discharge of all obligations under any Loan Document.

 

 

Section 2.18         Partial Releases.

 

(a)          General Provisions. Notwithstanding anything contained in this Agreement, the Note, the Mortgage or any of the other Loan Documents to the contrary, upon the request of Borrowers, Administrative Agent agrees to release its Lien with respect to one or more of the Individual Projects (each, a “Partial Release Project”) from the lien of the related Mortgage and the other Loan Documents (or, at the applicable Borrower’s request, assign its interest in the Mortgage and the other Loan Documents applicable to the Individual Project as further provided in clause (xi) below), release the applicable Borrower with respect to such Individual Project from the Assignment of Ownership Interest and release the applicable Borrower from its obligations under the Loan Documents and, provided that all of the following terms and conditions are satisfied (such release herein called a “Partial Release”):

 

(i)            Except in connection with the sale of a Project to a Person that is not an Affiliate of any Borrower Party, none of the Projects that are not Agency Disposition Assets may be released until all of the Agency Disposition Assets have been released in accordance with this Section 2.18.

 

(ii)           After giving effect to a Partial Release and payment of the Partial Release Price, (A) there shall be at least three (3) Individual Projects remaining as security for the Loan and (B) the ratio of the principal balance of the Loan to the appraised “as-is” value of the remaining Projects is not greater than seventy-five percent (75%).

 

(iii)          There shall exist no Event of Default at the time the Partial Release request is made by Borrowers, and Borrowers shall certify in writing to Administrative Agent that no Event of Default shall exist immediately after giving effect to the applicable Partial Release and the execution and delivery of all documents connected therewith.

 

(iv)          In each case after giving effect to the release or assignment of the Partial Release Project, the remaining Projects shall have achieved:

 

(A)         a pro forma (i.e., taking into account the release of the Partial Release Project and excluding the ANOI of such Partial Release Project) Debt Yield (based on the trailing six (6) full calendar months most recently ending; provided that if on any such date during the first Loan Year, operating statements for the prior 6-month period are not available, the operating statements covering any lesser period of time will be annualized) of at least (1) in the case of a Partial Release Project that are Agency Disposition Assets, nine percent (9.00%) and (2) in the case of Partial Release Project (other than Agency Disposition Assets),

 

(1)         with respect to the first nine (9) Partial Release Projects being released (x) during the first Loan Year, nine percent (9.00%), (y) during the second Loan Year, nine and one-half percent (9.50%), and (z) during the third Loan Year, ten percent (10.00%).

 

(2)         with respect to the remaining Partial Release Projects being released (x) during the first Loan Year, nine and one-half percent (9.50%), (y) during the second Loan Year, ten percent (10.00%), and (z) during the third Loan Year, ten and one-half percent (10.50%).

 

 

(B)         a Debt Service Coverage Ratio of at least 1.25:1.00.

 

(v)         Borrowers shall deliver, together with such request for the Partial Release, a pro forma Compliance Certificate showing that, on a pro forma basis, after giving effect to such release, the financial tests in subsection (iv) above shall be satisfied.

 

(vi)        Borrowers shall provide written notice to Administrative Agent of their desire to have the applicable Partial Release Project released as security for the Loan (the “Release Notice”), and provide Administrative Agent with all information (including any proposed partial release forms) and documents relating to such release (or the applicable Mortgage assigned), at least thirty (30) days prior to the anticipated date for such partial release (or assignment) and deliver to Administrative Agent the documents to be executed by Administrative Agent or Lenders in connection therewith at least five (5) Business Days before the anticipated date for such partial release (or assignment) which forms of such documents must be reasonably satisfactory to Administrative Agent in form and substance.

 

(vii)       Such release or assignment will not affect the priority of lien or liens on the remainder of the Security, or Administrative Agent’s or Lenders’ rights in and to the remainder of the Security.

 

(viii)      Borrowers shall pay all reasonable out of pocket expenses of Administrative Agent, including reasonable attorneys’ fees and expenses, title insurance premiums (if applicable), recording costs and similar costs in connection with the Partial Release.

 

(ix)         Administrative Agent shall receive reasonable assurances if reasonably requested by Administrative Agent that the Environmental Indemnity Agreement shall remain in full force and effect with respect to the remaining Security and the Partial Release Project, subject in each case to the terms and conditions of the Environmental Indemnity Agreement.

 

(x)          Borrowers shall pay to Administrative Agent, for the account of Lenders, an amount equal to (1) with respect to Agency Disposition Assets that are refinanced through FNMA or FHLMC, 100% of the cash proceeds of such refinancing (net of reasonable costs, fees, and expenses in connection with any such refinancing), (2) with respect to Partial Release Projects that are Agency Disposition Assets and are being released in connection with a sale thereof, the greater of (x) 100% of the cash proceeds of such sale (net of reasonable costs, fees, and expenses in connection with any such sale) and (y) 100% of the Allocated Loan Amount for the Partial Release Project, (3) with respect to Partial Release Projects that are not Agency Disposition Assets and are being released in connection with a sale thereof, the greater of (x) 120% of the Allocated Loan Amount for the Partial Release Project and (y) an amount (if any) necessary to cause the Debt Yield (based on the trailing six (6) full calendar months most recently ending; provided that if on any such date during the first Loan Year, operating statements for the prior 6-month period are not available, the operating statements covering any lesser period of time will be annualized) on a pro forma basis (i.e., taking into account the release of the Partial Release Project, excluding the ANOI of such Partial Release Project, and giving effect to any Loan payment in connection with such release) is not less than the Debt Yield immediately prior to giving pro forma effect to such release, or (4) in all other cases, 100% of the Allocated Loan Amount for the Partial Release Project (such amount in (1), (2), (3), or (4) is the “Partial Release Price”), plus the pro rata portion of the Exit Fee required and calculated on the Partial Release Price. For the avoidance of doubt, if at any time the Partial Release Price paid to the Administrative Agent is in an amount greater than the amount of the outstanding Obligations then the Administrative Agent shall return such excess as directed by the Borrower Representative.

 

 

(xi)         Administrative Agent shall receive such title insurance endorsements as it may require, including partial release endorsements (if available).

 

(xii)        If Borrower advises Administrative Agent that it desires Administrative Agent to assign the applicable Mortgage and other documents securing the Loan encumbering the Partial Release Project to a new lender providing the funds for such prepayment, then Administrative Agent and Lenders shall (i) reasonably cooperate with Borrower to split and sever the Note and applicable Mortgage (if applicable) and/or assign the applicable Note and Mortgage and all of the other applicable Loan Documents to any Person designated by Borrower, which assignment documents shall be in recordable form and otherwise in form and substance reasonably acceptable to Administrative Agent, (ii) deliver to or as directed by Borrower the originally executed applicable Note and all originally executed other notes which may have been consolidated, amended and/or restated in connection with the execution of the applicable Note and which originals were delivered to Administrative Agent, (iii) execute and deliver an allonge with respect to the applicable Note, (iv) deliver the original executed Mortgage or a certified copy of record, and (v) execute and deliver such other instruments of conveyance, assignment, termination, severance and release (including appropriate UCC-3 termination statements and terminations of rent direction notices to Tenants, Operating Tenants and other third parties) in recordable form as may reasonably be requested by Borrower to evidence such assignment; provided however, that Borrowers will pay all costs and expenses of Administrative Agent in connection with the foregoing and such assignment shall be made without representation, warranty or covenant by Administrative Agent and such documentation is otherwise acceptable to Administrative Agent in its sole discretion.

 

(b)          Upon receipt of the amounts required under Sections 2.18(a)(viii) and 2.18(a)(x) above and satisfaction of all of the other requirements contained in this Section 2.18, in addition to releasing the applicable Project from the lien of the applicable Mortgage and other Loan Documents specific to the Partial Release Project, or assigning the applicable Note, Mortgage and other applicable documents, Administrative Agent shall also release (i) all obligations of Borrower that is the owner of the Partial Release Project under all of the Loan Documents, and the other Borrowers under all other Loan Documents as, but only to the extent as to such other Borrowers, as they relate to the Partial Release Project and (ii) any funds in the Funds and tax and insurance escrows, in each case, relating solely to the Partial Release Project or the pro rata share thereof (as determined by the Administrative Agent in its reasonable discretion) with respect to such Partial Release Project. Any such application of funds to the Loan shall be deemed a prepayment and shall be subject to the Libor Breakage Amount and Exit Fee, in each case as applicable. Following each Partial Release, the monthly principal payments required under Section 2.3(a)(ii), if any, as applicable, shall be recalculated based upon the outstanding principal balance of the Loan after the Partial Release Payment is applied by Lenders and assuming a 25-year amortization period, less the full or partial months elapsed since the Closing Date. Such recalculated monthly payment shall be due and payable commencing on the first Payment Date following the month in which the Partial Release occurs.

 

 

Section 2.19         Defaulting Lenders.

 

(a)          Defaulting Lender Adjustments. Notwithstanding any provision of this Agreement to the contrary, if any Lender becomes a Defaulting Lender, then the following provisions shall apply for so long as such Lender is a Defaulting Lender:

 

(i)            Any amount payable to a Defaulting Lender hereunder (whether on account of principal, interest, fees or otherwise) shall, in lieu of being distributed to such Defaulting Lender, be retained by Administrative Agent in a segregated account and, subject to any Requirements of Law, be applied at such time or times as may be determined by Administrative Agent (i) first, to the payment of any amounts owing by such Defaulting Lender to Administrative Agent hereunder, (ii) second, if so determined by Administrative Agent and Borrowers, held in such account as cash collateral for future funding obligations (if any) of the Defaulting Lender hereunder, (iii) third, pro rata, to the payment of any amounts owing to Borrowers, Administrative Agent or Lenders as a result of any judgment of a court of competent jurisdiction obtained by Borrowers, Administrative Agent or any Lender against such Defaulting Lender as a result of such Defaulting Lender’s breach of its obligations hereunder, and (iv) fourth, to such Defaulting Lender or as otherwise directed by a court of competent jurisdiction; provided, that if such payment is a prepayment of the principal amount of the Loan, such payment shall be applied solely to prepay the portion of the Loan held by Lenders that are not Defaulting Lenders pro rata prior to being applied to the prepayment of all or any portion of the portion of the Loan held by any Defaulting Lender.

 

(ii)           Notwithstanding anything set forth herein to the contrary, a Defaulting Lender shall not have any voting or consent rights under or with respect to this Agreement or any other Loan Document or constitute a “Lender” (or be included in the calculation of “Required Lenders” hereunder) for any voting or consent rights under or with respect to this Agreement or any other Loan Document except with respect to items described in Section 11.2(a) which require the vote or consent of all Lenders or all affected Lenders, and no Defaulting Lender shall have any other right to approve or disapprove any amendment, waiver, consent or any other action Lenders or the Required Lenders have taken or may take hereunder (including any consent to any amendment or waiver pursuant to Section 11.2), provided that any waiver, amendment or modification described in Section 11.2(a) requiring the consent of all Lenders or each directly affected Lender which affects such Defaulting Lender differently than other affected Lenders shall require the consent of such Defaulting Lender.

 

 

(iii)          The failure of any Defaulting Lender to make any Loan, advance or any payment required by it hereunder shall not relieve any other Lender of its obligations to make such Loan, advance or payment, but neither any Lender nor Administrative Agent shall be responsible for the failure of any Defaulting Lender to make a Loan, advance or make any other payment required hereunder.

 

(iv)          At the written request of Borrower Representative, Administrative Agent or a Person reasonably acceptable to Administrative Agent shall have the right with Administrative Agent’s written consent and in Administrative Agent’s sole discretion (but without any obligation whatsoever on Administrative Agent) to purchase from any Defaulting Lender, and each Defaulting Lender agrees that it shall, at Administrative Agent’s written request, promptly sell and assign to Administrative Agent or such Person, all of the interests of that Defaulting Lender for an amount equal to the principal balance of the portion of the Loan held by such Defaulting Lender and all accrued interest and fees with respect thereto through the date of sale, such purchase and sale to be consummated (if at all upon Administrative Agent’s election) pursuant to an executed Assignment Agreement.

 

(b)          Defaulting Lender Cure. If Borrowers and Administrative Agent agree in writing that a Lender is no longer a Defaulting Lender, Administrative Agent will so notify the parties hereto, whereupon as of the effective date specified in such notice and subject to any conditions set forth therein (which may include arrangements with respect to any cash collateral), that Lender will, to the extent applicable, purchase at par that portion of the outstanding Loan held by the other Lenders or take such other actions as Administrative Agent may determine to be necessary to cause the Loan to be held pro rata by Lenders in accordance with their pro rata shares, whereupon such Lender will cease to be a Defaulting Lender; provided that no adjustments will be made retroactively with respect to fees accrued or payments made by or on behalf of Borrowers while that Lender was a Defaulting Lender; and provided, further, that except to the extent otherwise expressly agreed by the affected parties, no change hereunder from Defaulting Lender to Lender will constitute a waiver or release of any claim of any party hereunder arising from that Lender’s having been a Defaulting Lender.

 

(c)          Payments Credited to Defaulting Lender. Notwithstanding anything in this Agreement, including this Section 2.19 to the contrary, Administrative Agent and all Lenders agree that Borrower’s delivery to Administrative Agent of all amounts due and payable to Lenders and/or Administrative Agent at any time shall be deemed delivery of payment to all Lenders and/or Administrative Agent, as applicable, of such amounts as of the date of delivery of such funds to Administrative Agent by or on behalf of Borrower regardless of whether Administrative Agent delivers the same to the applicable Lenders including, without limitation, regardless of whether any amounts are withheld by Administrative Agent from a Defaulting Lender pursuant to the terms of this Agreement.

 

 

ARTICLE 3

 

INSURANCE, CONDEMNATION AND IMPOUNDS

 

Section 3.1           Insurance. Borrowers shall maintain (or cause to be maintained) insurance as follows:

 

(a)          Property; Business Interruption. Borrowers shall (i) keep the Projects insured against damage by fire, acts of domestic and foreign terrorism, any type of wind (including named storms) and such other hazards covered by a special form or all-risk insurance policy (A) for the full insurable value thereof on a replacement cost basis without any coinsurance, (B) with a deductible not to exceed $75,000, except for wind/named storms and earthquake, which shall provide for a deductible of no more than five percent (5%) of the total insurable value of the Projects, (C) containing Law & Ordinance coverage with respect to any Individual Project if any of the Improvements on or the use of any such Individual Project shall at any time constitute legal non-conforming structures or uses, including coverage for loss to the undamaged portion of the building (with a limit equal to replacement cost), the cost of demolition and the increased costs of construction (each in amounts as reasonably required by Administrative Agent, but not to exceed one hundred percent (100%) of the replacement cost value for Coverage A and twenty percent (20%) of the replacement cost value for each of Coverages B and C), and (D) shall maintain boiler and machinery insurance and such other property insurance as reasonably required by Administrative Agent. Administrative Agent reserves the right to reasonably require such other insurance from time to time, including but not limited to earthquake, flood (in addition to Federal Flood Insurance) and sinkhole, if exposures are reasonably deemed to be at an elevated risk to such loss (i.e., Earthquake Zones 3 and 4 with Probably Maximum Loss of twenty percent (20%) or greater, FEMA Designated Special Flood Hazard Area (SFHA)), each in amounts acceptable to Administrative Agent. The full insurable value shall be re-determined from time to time (but not more frequently than once in any twelve (12) calendar months) at the request of Administrative Agent by an appraiser or contractor designated and paid by Borrowers and reasonably approved by Administrative Agent, or by an engineer or appraiser in the regular employ of the insurer. No omission on the part of Administrative Agent to request any such ascertainment shall relieve Borrowers of any of their obligations under this Subsection. Further, if any portion of any improvements that are part of any Project or personal property at any Project is located currently or at any time in the future in Special Flood Hazard Area, Borrowers shall deliver to Administrative Agent the following: (1) evidence as to whether the community in which such Project is located is participating in the National Flood Insurance Program, (2) the applicable Borrowers’ written acknowledgment of receipt of written notification from Administrative Agent as to the fact that such Project is located in a Special Flood Hazard Area and as to whether the community in which such real estate is located is participating in the National Flood Insurance Program, and (3) copies of the application for a Federal Flood Insurance policy, plus proof of premium payment, a declaration page confirming that Federal Flood Insurance has been issued, or such other evidence of Federal Flood Insurance satisfactory to Administrative Agent, in all cases naming Administrative Agent as Mortgagee on behalf of Lenders; and (ii) maintain business interruption insurance, including rental income loss and extra expense, (A) with loss payable to Administrative Agent, (B) covering all perils required herein to be insured against, (C) covering a period of restoration of twelve (12) months and containing an extended period of indemnity endorsement which provides that after the physical loss to the Improvements has been repaired, the continued loss of income will be insured until such income either returns to the same level it was at prior to the loss, or the expiration of six (6) months from the date that the applicable Individual Project is repaired or replaced and operations are resumed, whichever first occurs, and notwithstanding that the policy may expire prior to the end of such period and (D) in an amount equal to one hundred percent (100%) of the projected gross revenue (less non-continuing expenses) from the Projects as determined by Administrative Agent for a period of twelve (12) months, or such lesser amount written on a blanket basis, as determined by Administrative Agent. The amount of such business interruption insurance shall be determined prior to the date hereof and at least once each year thereafter based on Borrowers’ reasonable estimate of the gross revenue (less non-continuing expenses) from the Projects for the succeeding twelve (12) month period. During the existence of an Event of Default, all business interruption proceeds from the Projects shall be held by Administrative Agent and shall be applied to the Obligations secured by the Loan Documents from time to time due and payable hereunder and under the Note; provided, however, that nothing herein contained shall be deemed to relieve Borrowers of their Obligations to pay all amounts due hereunder on the Payment Dates set forth herein, except to the extent such amounts are actually paid out of the proceeds of such business interruption insurance.

 

 

(b)          Liability. Borrowers shall maintain or cause Operating Tenant to maintain (i) commercial general liability insurance (with no exclusion for acts of domestic and foreign terrorism) for both personal injury, bodily injury to or death of a person and for property damage providing for limits of liability in the amount reasonably approved by Administrative Agent but in no event less than $1,000,000 per occurrence and $2,000,000 in the aggregate, in each case, for the Projects, (ii) umbrella liability coverage in the amount and to the extent reasonably required by Administrative Agent, not to exceed $50,000,000 and on terms consistent with the general liability insurance required hereinabove, and (iii) other liability insurance as reasonably required by Administrative Agent, including but limited to auto liability or worker’s compensation and employer’s liability covering employees of Borrowers. In addition, Borrowers shall or shall cause each Property Manager, if applicable, to maintain (A) worker’s compensation insurance and employer’s liability insurance covering employees at the Projects employed by such Operator (in the amounts required by applicable Requirements of Law) and (B) professional liability insurance. In no event shall Borrowers consent to any decrease in the amount or scope of coverage or increase the deductibles from those previously approved by Administrative Agent.

 

(c)          Construction, Repairs, Alterations. At all times during which structural construction, repairs or alterations are being made with respect to any Improvements, and only if the property or liability coverage forms do not otherwise apply, (A) commercial general liability and umbrella liability insurance covering claims related to the construction, repairs or alterations being made which are not covered by or under the terms or provisions of the commercial general liability and umbrella liability insurance policy required in Section 3.1(b); and (B) the insurance provided for in Section 3.1(a) written in a so-called builder’s risk completed value form (1) on a non-reporting basis, (2) against all risks insured against pursuant to Section 3.1(a), and (3) including permission to occupy the Projects.

 

 

(d)          Form and Quality. All insurance policies shall be obtained under valid and enforceable policies and shall be subject to the reasonable approval of Administrative Agent as to form and substance, including insurance companies, amounts, deductibles, loss payees and insureds. Such policies shall be endorsed in form and substance reasonably acceptable to Administrative Agent to name Administrative Agent (on behalf of Lenders) thereunder as an additional insured, as its interest may appear, on liability insurance policies and as mortgagee/lender’s loss payable, as its interest may appear, on all property insurance policies, including but not limited to special form/all-risk, business interruption, boiler and machinery, terrorism, windstorm, and, when required, flood and earthquake insurance, with all loss payable to Administrative Agent, without contribution, under a standard non-contributory mortgagee clause. No policy shall contain a Protective Safeguard Endorsement. Administrative Agent shall act on behalf of Lenders in respect of insurance matters. The proceeds of insurance paid on account of any damage or destruction to any Project shall be paid to Administrative Agent, on behalf of Lenders, to be applied as provided in Section 3.2. In the event any Borrower or Operator receives any insurance proceeds as contemplated by this Article 3 (without the same having been disbursed to Administrative Agent), Borrowers will (with respect to proceeds received by Borrower and only if such proceeds are otherwise required to be delivered to Administrative Agent hereunder), or will cause Operator to immediately return such proceeds to Administrative Agent for application in accordance with the provisions of Section 3.2. All such insurance policies and endorsements shall be fully paid for and contain such provisions and expiration dates and be in such form reasonably acceptable to Administrative Agent and issued by such insurance companies approved to do business in the state in which the applicable Project is located, with a rating of “A-X” (or better as established by Best’s Rating Guide or “A-” or better by Standard & Poor’s Ratings Group or, if such insurance is being issued through a captive insurance company that is approved in writing by the Administrative Agent in its reasonable discretion, Demotech Inc. Each property insurance policy shall provide that such policy may not be canceled except upon thirty (30) days’ prior written notice (except ten (10) days’ prior notice for non-renewal or cancellation due to non-payment of premium) to Administrative Agent and that no act or negligence of Borrowers, or any other insured under the policy, or failure to comply with the provisions of any Policy which might otherwise result in a forfeiture of the insurance or any part thereof, or commencement of foreclosure or similar action, shall in any way affect the validity or enforceability of the insurance insofar as Administrative Agent is concerned. If available using commercially reasonable efforts, each liability insurance policy shall provide that such policy may not be canceled except upon thirty (30) days’ prior written notice (except ten (10) days’ prior notice for non-renewal or cancellation due to non-payment of premium) to Administrative Agent (provided that, if the insurer will not or cannot provide the required notice, Borrowers shall be obligated to provide such notice). Blanket policies shall be permitted only if (i) any such policy shall in all other respects comply with the requirements of this Section and (ii) such policy is approved in advance in writing by Administrative Agent in its reasonable discretion and such policy includes changes to the coverages and requirements set forth herein as may be required by Administrative Agent (including, without limitation, increases to the amount of coverages required herein); provided, however, that Borrowers shall not be required to obtain approval from Administrative Agent for any renewal of a previously approved blanket policy unless the terms of such policy have been materially changed. Notwithstanding Administrative Agent’s approval of any blanket policy hereunder, Administrative Agent reserves the right, in its sole discretion, to require Borrowers to obtain a separate policy in compliance with this Section 3.1. Borrowers authorize Administrative Agent to pay the premiums for such policies (the “Insurance Premiums”) from the Insurance Impound, if applicable, as the same become due and payable annually in advance. If Borrowers fail to deposit funds into the Insurance Impound in accordance with and when required by Section 3.4 sufficient to permit Administrative Agent to pay the Insurance Premiums when due, Administrative Agent may obtain such insurance and pay the premium therefor and Borrowers shall, on demand, reimburse Administrative Agent for all expenses incurred in connection therewith. Borrowers shall not maintain any separate or additional insurance which is contributing in the event of loss unless it is properly endorsed and otherwise reasonably satisfactory to Administrative Agent in all respects.

 

 

(e)          Assignment; Delivery of Certificates and Policies. Borrowers shall assign (or cause to be assigned) the policies relating to the Projects and all proceeds payable thereunder or proofs of insurance to Administrative Agent (for the benefit of Lenders), in such manner and form that Administrative Agent shall require and Administrative Agent and its successors and assigns shall at all times have and hold the same as security for the payment of the Loan. In the event of a foreclosure of any Security or other transfer of title to any Project in extinguishment in whole or in part of the Indebtedness, all right, title and interest of Borrowers in and to the Policies then in force concerning the applicable Project and all proceeds payable thereunder shall thereupon vest exclusively in Administrative Agent or, subject to the insurer’s prior written approval, the purchaser at such foreclosure or other transferee in the event of such other transfer of title. Unless otherwise approved by Administrative Agent, with respect to the property insurance required under this Section 3.1, Borrowers shall provide (i) on or before the Closing Date, an ACORD 27 or 28 along with a policy binder which is valid for at least 60 days following the Effective Date or a complete copy of the policy, (ii) endorsements required by Administrative Agent within thirty (30) days following the Closing Date if not provided on or before the Closing Date and (iii) a copy of the full policy within sixty (60) days following the Closing Date or prior to expiration of the binder. Unless otherwise approved by Administrative Agent, with respect to the liability insurance required under this Section 3.1, Borrowers shall provide (i) on or before the Closing Date, an ACORD 25 along with evidence of 30-day notice of cancellation of coverage, (ii) endorsements required by Administrative Agent within thirty (30) days following the Closing Date if not provided on or before the Closing Date and (c) a copy of the full policy within sixty (60) days following the Closing Date. If Borrowers elect to obtain any insurance which is not required under this Agreement, all related insurance policies shall be endorsed in compliance with Section 3.1(d), and such additional insurance shall not be canceled without prior notice to Administrative Agent. From time to time upon Administrative Agent’s request, Borrowers shall identify to Administrative Agent all insurance maintained by Borrowers with respect to the Projects. The proceeds of insurance policies coming into the possession of Administrative Agent shall not be deemed trust funds, and Administrative Agent shall be entitled to apply such proceeds as herein provided.

 

(f)          Adjustments. Borrowers shall give prompt written notice of any loss in excess of $100,000 to the insurance carrier and to Administrative Agent. Borrowers hereby irrevocably authorize and empower Administrative Agent, as attorney in fact for Borrowers coupled with an interest, to (i) notify any of Borrowers’ insurance carriers to add Administrative Agent (for itself and the benefit of Lenders) as a loss payee, mortgagee insured or additional insured, as the case may be, to any policy maintained by Borrowers (regardless of whether such policy is required under this Agreement), (ii) if such loss exceeds the Restoration Threshold, make proof of loss, to adjust and compromise any claim under insurance policies, appear in and prosecute any action arising from such insurance policies, and (iii) collect and receive insurance proceeds, and to deduct therefrom Administrative Agent’s reasonable expenses incurred in the collection of such proceeds. Nothing contained in this Section 3.1(f), however, shall require Administrative Agent to incur any expense or take any action hereunder.

 

 

(g)          Warning Regarding Right of Administrative Agent to Purchase Insurance: IF BORROWERS FAIL TO PROVIDE ADMINISTRATIVE AGENT WITH EVIDENCE OF THE INSURANCE COVERAGES REQUIRED BY THIS AGREEMENT, ADMINISTRATIVE AGENT SHALL HAVE THE RIGHT TO TAKE SUCH ACTION DEEMED NECESSARY TO PROTECT THE INTEREST OF ADMINISTRATIVE AGENT AND LENDERS, INCLUDING, WITHOUT LIMITATION, THE PURCHASING OF INSURANCE AT BORROWERS’ EXPENSE AS ADMINISTRATIVE AGENT IN ITS SOLE DISCRETION DEEMS APPROPRIATE. THIS INSURANCE MAY, BUT NEED NOT, ALSO PROTECT BORROWERS’ INTEREST. IF THE COLLATERAL BECOMES DAMAGED, THE COVERAGE ADMINISTRATIVE AGENT PURCHASES MAY NOT PAY ANY CLAIM BORROWERS MAKE OR ANY CLAIM MADE AGAINST BORROWERS. BORROWERS ARE RESPONSIBLE FOR ALL EXPENSES INCURRED BY ADMINISTRATIVE AGENT IN CONNECTION WITH SUCH ACTION AND THE COST OF ANY INSURANCE PURCHASED PURSUANT TO THIS PROVISION AND SUCH COST IS PAYABLE ON DEMAND; IF BORROWERS FAIL TO PAY SUCH COST, IT MAY BE ADDED TO THE INDEBTEDNESS AND BEAR INTEREST AT THE DEFAULT RATE. THE EFFECTIVE DATE OF COVERAGE MAY BE THE DATE BORROWERS’ PRIOR COVERAGE LAPSED OR THE DATE BORROWERS FAILED TO PROVIDE PROOF OF COVERAGE. THE COVERAGE ADMINISTRATIVE AGENT PURCHASES MAY BE CONSIDERABLY MORE EXPENSIVE THAN INSURANCE BORROWERS CAN OBTAIN AND MAY NOT SATISFY ANY NEED FOR PROPERTY DAMAGE COVERAGE OR ANY MANDATORY LIABILITY INSURANCE IMPOSED BY REQUIREMENTS OF LAW. AFTER RECEIVING WRITTEN CONSENT FROM ADMINISTRATIVE AGENT, BORROWERS MAY LATER CANCEL THIS COVERAGE BY PROVIDING EVIDENCE THAT THE REQUIRED PROPERTY COVERAGE WAS PURCHASED ELSEWHERE.

 

(h)          Non-Conforming Policy. As an alternative to the policies required to be maintained pursuant to the preceding provisions of this Section 3.1, Borrowers will not be in default under this Section 3.1 if Borrowers maintain (or causes to be maintained) policies which (i) have coverages, deductibles or other related provisions other than those specified above or (ii) are provided by insurance companies not meeting the credit ratings requirements set forth above (any such policy, a “Non-Conforming Policy”), provided, that, prior to obtaining such Non-Conforming Policies (or permitting such Non-Conforming Policies to be obtained), Borrowers shall have received Administrative Agent’s prior written consent thereto. Notwithstanding the foregoing, Administrative Agent hereby reserves the right to deny its consent to any Non-Conforming Policy regardless of whether or not Administrative Agent has consented to the same on any prior occasion.

 

 

Section 3.2           Use and Application of Insurance Proceeds.

 

(a)          Notice; Repair Obligation. If any Project shall be damaged or destroyed, in whole or in part, by fire or other casualty (a “Casualty”), Borrowers shall give prompt notice thereof to Administrative Agent. Following the occurrence of a Casualty, provided Administrative Agent makes insurance proceeds available to Borrowers, Borrowers shall promptly proceed to restore, repair, replace or rebuild the same to be of at least equal value and of substantially the same character as prior to such damage or destruction, all to be effected in accordance with applicable Requirements of Law. If Administrative Agent is entitled to receive such proceeds and, pursuant to the terms hereof, does not make insurance proceeds available to Borrowers, Borrowers, at Borrowers’ expense, shall promptly proceed to remove any debris and secure the damaged Project.

 

(b)          Application of Insurance Proceeds. Administrative Agent shall make insurance proceeds available to Borrowers for application to the costs of restoring the damaged Project or to the payment of the Loan as follows:

 

(i)            if the insurance proceeds plus the amount of any deductible is less than or equal to the Restoration Threshold, Administrative Agent shall make the insurance proceeds available to Borrowers, which proceeds shall be used by Borrowers to pay for the restoration of the damaged Project provided (A) no Event of Default exists, and (B) the applicable Borrower promptly commence and are diligently pursuing restoration of the damaged Project;

 

(ii)           if the insurance proceeds plus the amount of any deductible exceeds the Restoration Threshold but is not more than twenty-five percent (25%) of the aggregate amount of the Loan outstanding on such date, Administrative Agent shall disburse the insurance proceeds to the applicable Borrower, which proceeds shall be used by the applicable Borrower for the restoration of the damaged Project; provided that (A) at all times during such restoration no Event of Default exists; (B) Administrative Agent determines that there are sufficient funds available to restore and repair the damaged Project to a condition existing immediately prior to such Casualty or, if Administrative Agent reasonably determines there is any such insufficiency, Borrowers provide additional security to address such insufficiency to Administrative Agent’s reasonable satisfaction; (C) Administrative Agent reasonably determines that the Adjusted Net Operating Income of the Projects (including the damaged Project) during restoration, taking into account rent loss or business interruption insurance, will be sufficient to pay all amounts due hereunder as the same are due and payable; (D) Administrative Agent reasonably determines that restoration and repair of the damaged Project to a condition reasonably approved by Administrative Agent will be substantially completed within nine (9) months after the date of loss or casualty and in any event ninety (90) days prior to the Maturity Date; (E) the applicable Borrower promptly commences and are diligently pursues restoration of the damaged Project; (F) the Project after the restoration will be in compliance with and permitted under all Requirements of Law; and (G) Borrowers demonstrate compliance with the financial covenants set forth in Section 7.13; and

 

(iii)           if the conditions set forth in (i) and (ii) above are not satisfied or the loss exceeds the maximum amount specified in Section 3.2(b)(ii) above, (A) if no Event of Default exists hereunder, Administrative Agent may elect to apply any insurance proceeds Administrative Agent receives as a prepayment of the Loan, or allow all or a portion of such proceeds to be used for the restoration of the damaged Project and (B) if an Event of Default exists hereunder, Administrative Agent shall apply any insurance proceeds Administrative Agent receives as a prepayment of the Loan. Any prepayment of the Loan made pursuant to this Section 3.2 shall be made without Exit Fee or penalty.

 

 

(c)          Disbursement of Insurance Proceeds. Insurance proceeds received by Administrative Agent and to be applied to restoration pursuant to the terms of this Section 3.2, will be disbursed by Administrative Agent to the applicable Borrowers on a monthly basis, commencing within ten (10) Business Days following receipt by Administrative Agent of plans and specifications, contracts and subcontracts, schedules, budgets, conditional lien waivers and architects’ certificates all in form reasonably satisfactory to Administrative Agent, and otherwise in accordance with prudent commercial construction lending practices for construction loan advances (including appropriate retainages to ensure that all work is completed in a workmanlike manner). Any insurance proceeds remaining after payment of all restoration costs under Section 3.2(b)(ii) shall be remitted to Borrowers provided no Event of Default shall be continuing.

 

(d)          Special Right to Repay Loan. Notwithstanding anything in this Sections 3.2 or 3.3 to the contrary, if pursuant to Section 3.2(b)(iii) above or Section 3.3 below, Administrative Agent elects to require that the insurance or condemnation proceeds be applied as a prepayment of the Loan, Borrowers shall have the option to prepay the Allocated Loan Amount for the damaged Project and effect a Partial Release of the applicable Project in accordance with Section 2.4(e), less any insurance or condemnation proceeds actually received by Administrative Agent at the time of such prepayment, if any. If the insurance or condemnation proceeds have not been received by Administrative Agent at the time of prepayment, Borrowers will be entitled to receive all such insurance or condemnation proceeds after such prepayment of the Loan.

 

Section 3.3           Condemnation Awards. Borrowers shall promptly give Administrative Agent written notice of the actual or threatened commencement of any condemnation or eminent domain proceeding affecting any Project (a “Condemnation”) and shall deliver to Administrative Agent copies of any and all papers served in connection with such Condemnation. Following the occurrence of a Condemnation, Borrowers, regardless of whether any award or compensation (an “Award”) is available, shall promptly proceed to restore, repair, replace or rebuild the same to the extent practicable to be of at least equal value and of substantially the same character, as prior to such Condemnation, all to be effected in accordance with all Requirements of Law. Administrative Agent may participate in any such proceeding (for itself and on behalf of Lenders) and Borrowers will deliver to Administrative Agent all instruments necessary or required by Administrative Agent to permit such participation. Without Administrative Agent’s prior consent, Borrowers (a) shall not agree to any Award, and (b) shall not take any action or fail to take any action which would cause the Award to be determined. All Awards for the taking or purchase in lieu of condemnation of any Individual Project or any part thereof are hereby assigned to and shall be paid to Administrative Agent. Administrative Agent is hereby irrevocably appointed as Borrowers’ attorney-in-fact, coupled with an interest, with exclusive power to collect, receive and retain any Award and to make any compromise or settlement in connection with any such Condemnation and to give proper receipts and acquittances therefor, and in Administrative Agent’s sole discretion (in consultation with the Required Lenders) to apply the same toward the payment of the Loan), notwithstanding that the Loan may not then be due and payable, or to the restoration of the applicable Project; provided, however, if all Awards in the aggregate are less than or equal to the Restoration Threshold and Borrowers request that such proceeds be used for nonstructural site improvements (such as landscape, driveway, walkway and parking area repairs) required to be made as a result of such Condemnation, Administrative Agent will apply such Award(s) to such restoration in accordance with disbursement procedures applicable to insurance proceeds provided there exists no Event of Default. Borrowers, upon request by Administrative Agent, shall execute all instruments requested to confirm the assignment of the Awards to Administrative Agent, free and clear of all liens, charges or encumbrances. Anything herein to the contrary notwithstanding, if an Event of Default exists, Administrative Agent is authorized to adjust such Award without the consent of Borrowers and to collect such Award in the name of Administrative Agent (on behalf of itself and Lenders) and Borrowers.

 

 

Section 3.4           Insurance Impounds. Borrowers shall (i) deposit with Administrative Agent monthly on each Payment Date, a sum of money (the “Insurance Impound”) equal to one-twelfth (l/12th) of the annual charges for the Insurance Premiums and (ii) a sum of money which together with the monthly installments to be made prior to the date that is thirty (30) days before any delinquency or penalty is due with respect to the Insurance Premiums become due and payable will be sufficient to make each of such payments prior to such date. If Administrative Agent so elects in its reasonable discretion, at any time following Borrowers obligation to make deposits in the Insurance Impound, Borrowers shall not be obligated to deposit any sums with Administrative Agent pursuant to this Section 3.4 to the extent Borrowers provide evidence reasonably acceptable to Administrative Agent that Borrowers have paid all such Insurance Premiums. Deposits shall be made on the basis of Administrative Agent’s estimate from time to time of the Insurance Premiums for the current year. All funds so deposited shall be held without interest in Administrative Agent’s name or in the name of CONA (in each case, on behalf of all Secured Parties), and shall not be deemed to be held in trust for the benefit of Borrowers. All funds so deposited may be commingled with the general funds of Administrative Agent including without limitation as follows: (i) with Administrative Agent’s own funds at financial institutions selected by Administrative Agent in its reasonable discretion; or (ii) with Administrative Agent’s funds at CONA to be held in a Subaccount designated for Administrative Agent for such purpose. Borrowers hereby grant to Administrative Agent (for its benefit and the benefit of Secured Parties) a security interest in all funds so deposited with Administrative Agent for the purpose of securing the Loan. While an Event of Default exists, the funds deposited may be applied in payment of the Insurance Premiums for which such funds have been deposited, or to the payment of the Loan or any other charges affecting the security of Administrative Agent, as Administrative Agent may elect, but no such application shall be deemed to have been made by operation of law or otherwise until actually made by Administrative Agent. Borrowers shall furnish Administrative Agent with bills for the Insurance Premiums for which such deposits are required at least ten (10) days prior to the date on which the Insurance Premiums first become payable. If at any time the amount on deposit with Administrative Agent, together with amounts to be deposited by Borrowers before such Insurance Premiums are payable, is insufficient to pay such Insurance Premiums, Borrowers shall deposit any deficiency with Administrative Agent immediately upon demand. Administrative Agent shall pay such Insurance Premiums on or before the due date; provided the amount on deposit with Administrative Agent is sufficient to pay such Insurance Premiums and Administrative Agent has received a bill for such Insurance Premiums. On the Maturity Date, the monies then remaining on deposit with Administrative Agent under this Section 3.4 shall, at Administrative Agent’s option, be applied against the Indebtedness or if no Event of Default exists hereunder, returned to Borrowers. Borrowers shall provide Administrative Agent with proof of payment with respect to all of Borrowers’ insurance, in each case, not later than five (5) Business Days prior to the stated due date therefor.

 

  

Section 3.5           Real Estate Tax Impounds. Borrowers shall deposit with Administrative Agent monthly on each Payment Date, a sum of money (the “Tax Impound”) equal to one-twelfth (1/12th) of the annual Taxes for the Projects. Borrowers shall deposit with Administrative Agent a sum of money which together with the monthly installments will be sufficient to make each of such payments thirty (30) days prior to the date any delinquency or penalty becomes due with respect to such payments. Deposits shall be made on the basis of Administrative Agent’s reasonable estimate from time to time of the Taxes for the current year (after giving effect to any reassessment or, at Administrative Agent’s election, on the basis of the Taxes for the prior year, with adjustments when the Taxes are fixed for the then current year). All funds so deposited shall be held without interest in Administrative Agent’s name or in the name of CONA (in each case, on behalf of all Secured Parties), and shall not be deemed to be held in trust for the benefit of Borrowers. All funds so deposited may be commingled with the general funds of Administrative Agent including without limitation as follows: (i) with Administrative Agent’s own funds at financial institutions selected by Administrative Agent in its reasonable discretion; or (ii) with Administrative Agent’s funds at CONA to be held in a Subaccount designated for Administrative Agent for such purpose. Borrowers hereby grant to Administrative Agent (for its benefit and the benefit of Secured Parties) a security interest in all funds so deposited with Administrative Agent for the purpose of securing the Loan. While an Event of Default exists, the funds deposited may be applied in payment of the charges for which such funds have been deposited, or to the payment of the Loan or any other charges affecting the security of Administrative Agent, as Administrative Agent may elect, but no such application shall be deemed to have been made by operation of law or otherwise until actually made by Administrative Agent. Upon the reasonable request of Administrative Agent if the applicable tax monitoring services being utilized by Administrative Agent fails to do so, Borrowers shall furnish Administrative Agent with bills for the Taxes for which such deposits are required at least thirty (30) days prior to the date on which the Taxes first become payable. If at any time the amount on deposit with Administrative Agent, together with amounts to be deposited by Borrowers before such Taxes are payable, is insufficient to pay such Taxes, Borrowers shall deposit any deficiency with Administrative Agent immediately upon demand. Administrative Agent shall pay such Taxes on or before the same are delinquent; provided the amount on deposit with Administrative Agent is sufficient to pay such Taxes and Administrative Agent has received a bill for such Taxes. The obligation of Borrowers to pay the Taxes, as set forth in the Loan Documents, is not affected or modified by the provision of this paragraph; provided, however, that Borrowers shall not be in default under the Loan for failure to pay Taxes if and to the extent there are sufficient funds on deposit in the Tax Impound to timely pay such Taxes. On the Maturity Date, the monies then remaining on deposit with Administrative Agent under this Section 3.5 shall, at Administrative Agent’s option, be applied against the Indebtedness or if no Event of Default exists hereunder, returned to Borrowers. Upon the reasonable request of Administrative Agent if the applicable tax monitoring services being utilized by Administrative Agent fails to do so, Borrowers shall provide Administrative Agent with proof of payment with respect to all of Borrowers’ Taxes, in each case, not later than fifteen (15) Business Days prior to the date such Taxes become delinquent. If Borrowers fail to provide such proof of payment within such time periods, Administrative Agent, at its option, may require that Borrowers commence depositing Tax Impounds pursuant to this Section 3.5. Administrative Agent shall use commercially reasonable efforts to engage a tax monitoring service to monitor tax bills for the Projects and provide Administrative Agent with all information required by Administrative Agent regarding such tax bills and related tax payments. Any and all tax monitoring services utilized by Administrative Agent to ensure Borrowers’ compliance with the foregoing shall be reimbursed by Borrowers promptly upon demand.

 

 

ARTICLE 4

 

LEASING MATTERS

 

Section 4.1          Representations and Warranties on Leases.

 

(a)          Leases. Borrowers represent and warrant to Administrative Agent and the Lenders with respect to the Residential Leases that to Borrowers’ Knowledge (i) the rent roll or Census Report for each Project delivered to Administrative Agent is true and correct; (ii) such Leases are valid and in and full force and effect subject to applicable bankruptcy, insolvency or similar laws generally affecting the enforcement of a creditor’s rights; and (iii) the interests of the landlord and the rents under such Leases have not been assigned or pledged except as set forth on Schedule 4.1(a)). Borrowers represent and warrant to Administrative Agent and Lenders with respect to the Commercial Leases, if any, that to the Borrowers’ Knowledge, (i) the rent roll with respect to such Commercial Leases, if any, delivered to Administrative Agent is true and correct; (ii) such Commercial Leases are in full force and effect subject to applicable bankruptcy, insolvency or similar laws generally affecting the enforcement of a creditor’s rights; (iii) the interest of landlord thereunder has not been assigned or pledged except as set forth on Schedule 4.1(a); and (iv) except as otherwise approved by Administrative Agent, all existing Commercial Leases are subordinate to the Mortgage either pursuant to their terms or a recorded subordination and non-disturbance agreement in form and substance reasonably satisfactory to the Administrative Agent.

 

(b)          Operating Leases. Borrowers represent and warrant to Administrative Agent and the Lenders with respect to each Operating Lease that: (i) each Operating Lease is valid and in full force and effect; (ii) each Operating Lease (including amendments) is in writing, and there are no oral agreements with respect thereto; (iii) the copy of each Operating Lease delivered to Administrative Agent is true and complete; (iv) none of Borrowers or any Operator is (or as to the other party is, to such party’s knowledge), in default under any Operating Lease; (v) neither any Borrower nor any Operator have any knowledge of any notice of termination or default with respect to any Operating Lease; (vi) no Borrower has assigned or pledged the Operating Leases, the rents or any interests therein, except to Administrative Agent and the Lenders or except in connection with a Permitted Transfer; (vii) except as set forth in the Operating Leases, no Operator has an option to purchase all or any portion of the Projects; (viii) except as set forth in the Operating Leases, no Operator has the right to terminate any Operating Lease prior to expiration of the stated term of such Operating Lease (unless due to casualty or condemnation of the Projects); and (ix) no Operator has prepaid more than one month’s rent in advance.

 

 

Section 4.2           Standard Lease Form; Approval Rights. All Residential Leases shall be on a standard lease form approved by Administrative Agent, with no material modifications other than in the ordinary course of business or as required by any Requirements of Law. All Leases (other than Residential Leases and Commercial Leases that are De Minimis Leases) shall be in a form approved by Administrative Agent, with no material modifications other than as permitted under Section 4.3 below, it being acknowledged that the Administrative Agent has approved the Operating Leases in existence as of the Closing Date. Borrowers shall cause the Operators to hold, in trust, all residential tenant Security Deposits in a segregated account, and, to the extent required by any Requirements of Law, shall not commingle any such funds with any other funds of Borrowers. Within ten (10) days after Administrative Agent’s request, Borrowers shall furnish to Administrative Agent a statement of all tenant Security Deposits, and, to the extent not prohibited by Requirements of Law, copies of all Leases not previously delivered to Administrative Agent, certified by Borrowers as being true and correct. Notwithstanding anything contained in the Loan Documents to the contrary, Borrowers shall have the right to enter into Commercial Leases (including any extensions or modifications related thereto) without Administrative Agent’s consent provided (i) the Commercial Lease is a De Minimus Lease, (ii) the Commercial Lease is in the form previously approved by Administrative Agent without material modification, and (iii) the applicable tenant agrees to comply with any use restrictions applicable to the Project.

 

Section 4.3           Covenants.

 

(a)           Commercial Leases. Each of the Borrowers shall or shall use commercially reasonable efforts to cause Operators to (i) perform the obligations which any Borrower or Operator is required to perform under any Commercial Lease to which it is a party; (ii) enforce, in the ordinary course of business, the material obligations to be performed by the Tenants under the Commercial Leases to which it is a party as a landlord; (iii) promptly furnish to Administrative Agent any notice of default or termination received by any Borrower from any Tenant under a Lease (other than a De Minimus Lease), and any notice of default or termination given by any Borrower to any Tenant under a Lease (other than a De Minimus Lease); (iv) not collect any rents for more than one month in advance of the time when the same shall become due, except for bona fide Security Deposits or as permitted pursuant to the terms of such Lease; (v) not enter into any ground lease or master lease of any part of the Projects (other than the Operating Leases); (vi) not further assign or encumber any Commercial Lease; (vii) not, except with Administrative Agent’s prior written consent (other than as a result of the default by any tenant or as provided by the terms of the Commercial Lease), cancel, terminate or accept assignment of any Commercial Lease (other than a De Minimus Lease) to which it is a party; (viii) not, except with Administrative Agent’s prior written consent, modify or amend any Lease (other than a De Minimus Lease) (except for minor modifications and amendments entered into in the ordinary course of business, consistent with prudent property management practices, not affecting the economic terms or term of the Lease); and (ix) assign to Administrative Agent any letter of credit evidencing a Security Deposit on such terms as may be required by Administrative Agent and shall deliver the original of such letter(s) of credit to Administrative Agent to the extent assignable in accordance with its terms. Any action in violation of clauses (v), (vi), (vii), and (viii) of this Section 4.3(a) shall be void at the election of Administrative Agent.

 

 

(b)          Operating Leases. Borrowers shall (i) perform the material obligations in all material respects which Borrowers are required to perform under the Operating Leases; (ii) enforce the material obligations to be performed by the Operator under the Operating Leases; (iii) promptly furnish to Administrative Agent any notice of default or termination received by any Borrower from any Operator, and any notice of default or termination given by any Borrower to any Operator under the Operating Lease; (iv) not collect any rents for more than one month in advance of the time when the same shall become due under the Operating Lease, except for bona fide Security Deposits; (v) not, except with Administrative Agent’s prior written consent, cancel or accept surrender or termination or assignment of any Operating Lease with respect to all or any portion of the Projects (subject to the release rights under Section 2.18 above); (vi) not, except with Administrative Agent’s prior written consent, modify or amend the Operating Lease (except for minor modifications and amendments entered into in the ordinary course of business, consistent with prudent property management practices, not affecting the economic terms or term of the Operating Lease); and (vii) to the extent any Operator requires Borrowers’ consent under any Operating Lease, not grant any such consent without Administrative Agent’s prior written consent. Any action in violation of clauses (v), (vi), and (vii) of this Section 4.3(b) shall be void at the election of Administrative Agent (after consultation with the Required Lenders). Borrowers will not suffer or permit any breach or default to occur in any of any Borrower’s obligations under any Operating Lease nor suffer or permit the same to terminate by reason of any failure of any Borrower to meet any requirement of any Operating Lease; provided, however, that any Borrower may terminate an Operating Lease to which it is a party and enter into a new Operating Lease on substantially the same terms with an Affiliate of the Borrowers that will operate only the related Project. In addition to the foregoing, the Borrowers shall promptly furnish to Administrative Agent (A) any notice of default or termination received by any Borrower from Operators and (B) a copy of any notice of default or termination given by Borrowers to Operators under the Operating Leases.

 

Section 4.4           Tenant Estoppels.

 

(a)          Leases. At Administrative Agent’s request made not more than once in any calendar year in the absence of an Event of Default, Borrowers shall use commercially reasonable efforts to obtain and furnish (or use commercially reasonable efforts to cause Operators to obtain and furnish) to Administrative Agent, written estoppels in form and substance reasonably satisfactory to Administrative Agent (or, if the lease in question prescribes a form of estoppel, then substantially in such form), executed by Tenants under any Commercial Leases in excess of 3,000 square feet of any Project and confirming the term, rent, and other provisions and matters relating to such Commercial Lease.

 

(b)          Operating Leases. At Administrative Agent’s request, but no more frequently than once a year during the term of the Loan in the absence of an Event of Default or unless required by a Lender to which a portion of the Loan is assigned pursuant to Section 11.3, Borrowers shall obtain from Operators and furnish to Administrative Agent, a written estoppel in form and substance satisfactory to Administrative Agent (or, if the lease in question prescribes a form of estoppel, then substantially in such form), executed by Operators and confirming the term, rent and other provisions and matters relating to the Operating Leases.

 

 

Section 4.5           Compliance with Loan Terms. Notwithstanding anything to the contrary herein, to the extent any covenants contained in this Agreement relate to the use, operation and/or maintenance of the Projects, the Borrowers shall be deemed to be in compliance with such covenants if the Borrowers are causing each applicable Operator to comply with such covenants.

 

ARTICLE 5

 

REPRESENTATIONS AND WARRANTIES

 

Each Borrower represents, warrants and covenants to Administrative Agent and Lenders that:

 

Section 5.1           Organization, Power and Authority; Formation Documents.

 

(a)          Organization, Etc. Each Borrower and each other Borrower Party is duly organized, validly existing and in good standing under the laws of the state of its formation or existence and each Borrower is in compliance with all legal requirements applicable to doing business in the state in which the Projects are located. No Borrower is a “foreign person” within the meaning of §1445(f)(3) of the Code. Each Borrower and each other Borrower Party has only one state of incorporation or organization which is set forth on Schedule 5.1. All other information regarding each Borrower and each other Borrower Party contained in Schedule 5.1, including the ownership structure of Borrowers and their constituent entities, is true and correct as of the Closing Date.

 

(b)          Formation Documents. True and complete copies of the formation documents creating each Borrower and Guarantor together with all current limited liability company agreements, and any and all amendments thereto (collectively, the “Borrower Formation Documents”) have been furnished to Administrative Agent. The Borrower Formation Documents constitute the entire agreement regarding each Borrower and Guarantor and are binding upon and enforceable against each of the members of such Person in accordance with its terms. No breach exists under the Borrower Formation Documents and no condition exists which, with the giving of notice or the passage of time, would constitute a breach under the Borrower Formation Documents.

 

Section 5.2           Validity of Loan Documents. The execution, delivery and performance by each Borrower and each other Borrower Party of the Loan Documents and the Environmental Indemnity Agreement: (a) are duly authorized and do not require the consent or approval of any other party or Governmental Authority which has not been obtained; and (b) will not violate any law or result in the imposition of any lien, charge or encumbrance upon the assets of any such party, except as contemplated by the Loan Documents and/or the Environmental Indemnity Agreement. The Loan Documents and/or the Environmental Indemnity Agreement constitute the legal, valid and binding obligations of each Borrower and each other Borrower Party who is a party to such Loan Documents and/or the Environmental Indemnity Agreement, enforceable in accordance with their respective terms, subject to applicable bankruptcy, insolvency, or similar laws generally affecting the enforcement of creditors’ rights.

 

 

Section 5.3          Liabilities; Litigation.

 

(a)          Financial Statements. The financial statements delivered to Administrative Agent by Borrowers and each other Borrower Party hereunder are true and correct in all material respects as of the date of such financial statements. Except as disclosed in such financial statements, there are no liabilities (fixed or contingent) affecting any Project, any Borrower or any other Borrower Party. Except as disclosed in such financial statements, there is no litigation, administrative proceeding, investigation or other legal action (including any proceeding under any state or federal bankruptcy or insolvency law) pending or, to Borrowers’ Knowledge, threatened, against any Individual Project, any Borrower or any other Borrower Party which if adversely determined could have a Material Adverse Effect on such party, any Project or the Loan.

 

(b)          Contemplated Actions. No Borrower Party intends to file a petition by it under state or federal bankruptcy or insolvency laws or the liquidation of all or a major portion of its assets or property, and no Borrower Party has knowledge of any Person contemplating the filing of any such petition against it.

 

Section 5.4           Taxes and Assessments. There are no unpaid or outstanding Taxes or assessments on or against the Projects or any part thereof, except general real estate taxes not yet due or payable. Except as disclosed on Schedule 5.4, each Project is comprised of one or more tax parcels, and each such tax parcel constitutes a separate tax lot and none of which constitutes a portion of any other tax lot. There are no pending or, to Borrowers’ Knowledge, proposed, special or other assessments for public improvements or otherwise affecting any Project, nor are there any contemplated improvements to any Project that may result in such special or other assessments. 

 

Section 5.5           Other Agreements Defaults. No Borrower, nor any other Borrower Party, is a party to any agreement or instrument or subject to any court order, injunction, permit, or restriction which might adversely affect any Project or the business, operations, or condition (financial or otherwise) of any Borrower Party. No Borrower Party is in violation of any agreement which violation could reasonably be expected to have a Material Adverse Effect.

 

Section 5.6           Compliance with Laws. Each Borrower Party and, to each Borrower’s Knowledge, if applicable, the applicable Operator has all requisite Permits, if any, necessary to own, lease and operate its Individual Project and carry on its business, and, except as disclosed in the zoning reports or Property Condition Reports delivered to Administrative Agent prior to the Closing Date, each Project is in compliance with all applicable Requirements of Law. To Borrower’s Knowledge, no Borrower Party, is in violation in any material respect of any Healthcare Laws or the subject of any material Healthcare Investigation.

 

Section 5.7           Condemnation. Except as set forth on Schedule 5.7, no condemnation has been commenced or, to Borrowers’ Knowledge, is contemplated with respect to all or any portion of any Project or for the relocation of roadways providing access to any Project.

 

Section 5.8            Access. Each Project has adequate rights of access to public ways and is served by adequate water, sewer, sanitary sewer and storm drain facilities. All public utilities necessary or convenient to the full use and enjoyment of each Project are located in the public right-of-way abutting the applicable Project, and all such utilities are connected so as to serve such Project without passing over other property, except to the extent such other property is subject to a perpetual easement for such utility benefiting each Project. All roads necessary for the full utilization of each Project for its current purpose have been completed and dedicated to public use and accepted by all Governmental Authorities.

 

 

 

Section 5.9           Location of Borrowers. Each Borrower’s principal place of business and chief executive offices are located at the address stated in Schedule 5.9 and, except as otherwise set forth in Schedule 5.9, each Borrower at all times has maintained its principal place of business and chief executive office at such location or at other locations within the same state.

 

Section 5.10         ERISA Employees.

 

(a)          As of the Closing Date and throughout the term of the Loan, (i) no Borrower is nor will it be an “employee benefit plan” as defined in Section 3(3) of ERISA, which is subject to Title I of ERISA, and (ii) the assets of Borrowers do not and will not constitute “plan assets” of one or more such plans within the meaning of Section 3(42) of ERISA.

 

(b)          As of the Closing Date and throughout the term of the Loan (i) no Borrower is nor will it be a “governmental plan” within the meaning of Section 3(3) of ERISA and (ii) assuming that the Loan will not be funded or held with “plan assets” of any governmental plan and assuming that the counterparty to any such transaction is not a governmental plan or an entity whose assets are deemed to be “plan assets” of any governmental plan, transactions by or with any Borrower are not and will not be subject to state statutes applicable to any Borrower regulating investments of and fiduciary obligations with respect to governmental plans.

 

(c)          No Borrower has any employees.

 

Section 5.11         Use of Loan Proceeds. The proceeds of the Loan are intended and will be used for agricultural, business or commercial purposes and are not intended and will not be used for personal, family or household purposes.

 

Section 5.12         Margin Stock. No part of proceeds of the Loan will be used for purchasing or acquiring any “margin stock” within the meaning of Regulations T, U or X of the Board of Governors of the Federal Reserve System.

 

Section 5.13         Forfeiture. There has not been committed by any Borrower nor to Borrower’s Knowledge any other person in occupancy of or involved with the operation or use of the Projects any act or omission affording the federal government or any state or local government the right of forfeiture as against the Projects or any part thereof or any monies paid in performance of Borrowers’ obligations under any of the Loan Documents or the Environmental Indemnity Agreement. Borrowers hereby covenant and agree not to commit or permit to exist, to the extent within Borrowers’ control, any act or omission affording such right of forfeiture.

 

  

Section 5.14         Tax Filings. Each Borrower and each other Borrower Party has filed (or has obtained effective extensions for filing) all federal, state and local tax returns required to be filed and has paid or made adequate provision for the payment of all federal, state and local taxes, charges and assessments payable by each such Borrower and each other Borrower Party, respectively. Each Borrower Party believes that its respective tax returns properly reflect the income and taxes of each such Borrower Party, for the periods covered thereby, subject only to reasonable adjustments required by the Internal Revenue Service or other applicable tax authority upon audit.

 

Section 5.15         Solvency. After giving effect to the Loan, the fair saleable value of each Borrower’s assets (when considered collectively) will, immediately following the making of the Loan, exceed such Borrower’s total liabilities (provided, however, for purposes hereof, each Borrower’s joint liability hereunder as to portions of the Loan in excess of the Allocated Loan Amount applicable to the Project owned by such Borrower is not considered), including subordinated, unliquidated, disputed and contingent liabilities. No Borrower’s assets do and, immediately following the making of the Loan, will constitute unreasonably small capital to carry out its business as conducted or as proposed to be conducted. No Borrower intends to incur Debts and Liabilities (including contingent liabilities and other commitments) beyond its ability to pay such Debts as they mature (taking into account the timing and amounts of cash to be received by such Borrower and the amounts to be payable on or in respect of obligations of such Borrower). Except as expressly disclosed to Administrative Agent in writing, no petition in bankruptcy has been filed against any Borrower Party, in the last seven (7) years, and no Borrower Party in the last seven (7) years has ever made an assignment for the benefit of creditors or taken advantage of any insolvency act for the benefit of debtors. No Borrower Party is contemplating either the filing of a petition by it under state or federal bankruptcy or insolvency laws or the liquidation of all or a major portion of its assets or property, and no Borrower Party has knowledge of any Person contemplating the filing of any such petition against it.

 

Section 5.16         Full and Accurate Disclosure; No Material Adverse Change. No statement of fact made by or on behalf of any Borrower or any other Borrower Party in this Agreement, in any of the other Loan Documents or the Environmental Indemnity Agreement contains any untrue statement of a material fact or omits to state any material fact necessary to make statements contained herein or therein not misleading, nor has there been any material adverse change in any condition, fact, circumstance or event that would make the financial statements, rent rolls, reports, certificates or other documents submitted in connection with the Loan inaccurate, incomplete or otherwise misleading in any material respect as of the date of such statements, rent rolls, reports, certificates or other documents. There is no fact presently known to any Borrower Party which has not been disclosed to Administrative Agent which could reasonably be expected to have a Material Adverse Effect. All information supplied by Borrowers or any Borrower Party regarding any Collateral is accurate and complete in all material respects as of the date of such information. All evidence of each Borrower’s and each other Borrower Party’s identity provided to Administrative Agent and Lenders is genuine, and all related information is accurate.

 

 

Section 5.17         Flood Zone. Except as disclosed on the applicable survey delivered to Administrative Agent in connection with the closing of the Loan, no portion of the improvements comprising any Project is located in an area identified by the Secretary of Housing and Urban Development or any successor thereto as an area having special flood hazards pursuant to the National Federal Flood Insurance Act of 1968, the Flood Disaster Protection Act of 1973 or the National Federal Flood Insurance Act of 1994, as amended, or any successor law, or, if located within any such area, Borrowers have obtained and will maintain the insurance prescribed in Section 3.1 hereof.

 

Section 5.18         Single Purpose Entity/Separateness. Each Borrower represents, warrants and covenants, from and after the Closing Date for so long as any obligation under the Loan Documents remains outstanding, as follows:

 

(a)           Limited Purpose. The sole purpose conducted or promoted by each Borrower is to engage in the following activities:

 

(i)          to acquire, own, hold, lease, operate, manage, maintain, develop and improve the applicable Project (or an undivided interest therein) and to contract for the operation, maintenance, management and development of the applicable Project;

 

(ii)         to enter into and perform its obligations under the Loan Documents and Environmental Indemnity Agreement;

 

(iii)        to sell, transfer, service, convey, dispose of, pledge, assign, borrow money against, finance, refinance or otherwise deal with the applicable Project to the extent contemplated by or permitted under the Loan Documents; and

 

(iv)        to engage in any lawful act or activity and to exercise any powers permitted to limited liability companies organized under the laws of its jurisdiction of formation that are related or incidental to and necessary, convenient or advisable for the accomplishment of the above mentioned purposes.

 

(b)          Limitations on Debt, Actions. Notwithstanding anything to the contrary in the Loan Documents or in any other document governing the formation, management or operation of each Borrower, each Borrower shall not:

 

(i)           other than with respect to the pledge of its assets to secure the debt of the other Borrowers and the obligations of Guarantor under a Secured Hedge Agreement, guarantee any obligation of any Person, including any Affiliate of Borrower, or become obligated for the debts of any other Person or hold out its credit as being available to pay the obligations of any other Person;

 

(ii)          engage, directly or indirectly, in any business other than as required or permitted to be performed under this Section 5.18;

 

(iii)        incur, create or assume any Debt other than (A) the Loan and (B) unsecured trade payables incurred in the ordinary course of its business that are related to the ownership and operation of the applicable Project and which shall (x) not exceed two percent (2%) of the outstanding balance of the Loan, (y) not be evidenced by a note, and (z) be paid within the time period permitted under the terms of the applicable vendor’s contract (or 120 days if no period is specified) (provided, however, that such periods shall not apply with respect to any invoice that is being contested in good faith and in a timely manner by such Borrower);

 

 

(iv)        make or permit to remain outstanding any loan or advance to, or own or acquire any stock or securities of, any Person, except that Borrowers may invest in those investments permitted under the Loan Documents;

 

(v)         to the fullest extent permitted by law, engage in any dissolution, liquidation, consolidation, merger, sale or other transfer of any of its assets outside the ordinary course of each Borrower’s business or other than in accordance with the Loan Documents;

 

(vi)        buy or hold evidence of indebtedness issued by any other Person (other than cash or investment-grade securities);

 

(vii)       form, acquire or hold any subsidiary (whether corporate, partnership, limited liability company or other) or own any equity interest in any other entity;

 

(viii)      own any asset or property other than the applicable Project (or an undivided interest therein) and incidental personal property necessary for the ownership or operation of the applicable Project; or

 

(ix)         take any Material Action without the approval required under the applicable Borrower’s Formation Documents.

 

(c)          Separateness Covenants. In order to maintain its status as a separate entity and to avoid any confusion or potential consolidation with any Affiliate of any Borrower, each Borrower represents, warrants and covenants that in the conduct of its operations since its organization it has observed, and covenants that it will continue to observe, the following covenants:

 

(i)          maintain books and records and bank accounts separate from those of any other Person;

 

(ii)         maintain its assets in such a manner that it is not costly or difficult to segregate, identify or ascertain such assets and shall not commingle its assets or funds with those of any other Person;

 

(iii)        do all things reasonably necessary to observe organizational formalities necessary to maintain its separate existence;

 

(iv)        hold itself out to creditors and the public as a legal entity separate and distinct from any other entity;

 

 

(v)         maintain separate financial statements, showing its assets and liabilities separate and apart from those of any other Person and not have its assets listed on any financial statement of any other Person; except that each Borrower’s assets may be included in a consolidated financial statement of its Affiliate;

 

(vi)        other than with respect to the consolidated tax return of its Affiliates, and other than with respect to a “disregarded entity” (whose income is reported on the tax return of its owner), prepare and file its own tax returns separate from those of any Person to the extent required by Requirements of Law, and pay any taxes required to be paid by Requirements of Law;

 

(vii)       allocate and charge fairly and reasonably any common employee or overhead shared with Affiliates, constituents, or owners, or any guarantors of any of their respective obligations, or any Affiliate of any of the foregoing, including, but not limited to, paying for shared office space and for services performed by any employee of an Affiliate;

 

(viii)      not enter into any transaction with any Person owned or controlled by an Affiliate of Borrowers except on an arm’s-length basis on terms which are intrinsically fair and no less favorable than would be available for unaffiliated third parties, and pursuant to written, enforceable agreements;

 

(ix)         not commingle its assets or funds with those of any other Person other than as required or permitted by this Agreement;

 

(x)          except as otherwise provided in this Agreement or in any other Loan Documents, not assume, guarantee or pay the debts or obligations of any other Person other than with respect to the pledge of its assets to secure the debt of the other Borrowers;

 

(xi)         correct any known misunderstanding as to its separate identity;

 

(xii)        not permit any Affiliate of Borrowers to guarantee or pay its obligations (other than the co-Borrowers and the guarantees and indemnities set forth in the Loan Documents and in the Environmental Indemnity Agreement);

 

(xiii)       not make loans or advances to any other Person;

 

(xiv)      pay its liabilities and expenses out of and to the extent of its own funds so long as there is available cash flow from the applicable Project and provided, however, that the foregoing shall not require any owners of any Borrower to make additional capital contributions to any Borrower;

 

(xv)       pay the salaries of its own employees, if any, only from its own funds;

 

(xvi)      maintain adequate capital in light of its contemplated business purpose, transactions and liabilities (to the extent there exists sufficient cash flow from the applicable Individual Property to do so); provided, however, that the foregoing shall not require any equity owner to make additional capital contributions to any Borrower;

 

 

(xvii)     cause the managers, officers, employees, agents and other representatives of each Borrower to act at all times with respect to such Borrower consistently and in furtherance of the foregoing and in the best interests of such Borrower;

 

(xviii)    except as expressly provided in the Loan Agreement or in the other Loan Documents, not have any obligation to, and will not, indemnify its partners, officers, directors or members, as the case may be, unless such an obligation is fully subordinated to the Indebtedness and will not constitute a claim against it in the event that cash flow in excess of the amount required to pay the Indebtedness is insufficient to pay such obligation; and

 

(xix)       except as otherwise provided in this Agreement or in any other Loan Documents, not pledge its assets for the benefit of any other Person other than to Administrative Agent and Lenders in connection with the Loan.

 

Failure of any Borrower to comply with any of the foregoing covenants or any other covenants contained in this Agreement shall not affect the status of such Borrower as a separate legal entity.

 

Section 5.19       Compliance with International Trade Control Laws and OFAC Regulations. Each Borrower represents, warrants and covenants to Administrative Agent and Lenders that:

 

(a)          No Borrower Party and no Person who owns a direct interest in any Borrower is now nor shall be at any time until after the Loan is fully repaid, a Person with whom a U.S. Person, including a Financial Institution, is prohibited from transacting business of the type contemplated by this Agreement, whether such prohibition arises under U.S. law, regulation, executive orders and lists published by the OFAC (including those executive orders and lists published by OFAC with respect to Specially Designated Nationals and Blocked Persons) or otherwise.

 

(b)          Each Borrower Party and Person who owns a direct interest in any Borrower is now, and each Borrower will remain in compliance (and will cause each other Borrower Party and Person who owns a direct interest in any Borrower to remain in compliance) in all material respects with all U.S. economic sanctions laws, Executive Orders and implementing regulations as promulgated by OFAC and all applicable Anti-Money Laundering Laws.

 

Section 5.20         Borrowers’ Funds. Each Borrower represents, warrants and covenants to each Lender and Administrative Agent that:

 

(a)          It has taken, and shall continue to take until after the Loan is fully repaid, such measures as are required by law to verify that the funds invested in each Borrower are derived (i) from transactions that do not violate U.S. law and, to the extent such funds originate outside the United States, do not violate the laws of the jurisdiction in which they originated; and (ii) from permissible sources under U.S. law and to the extent such funds originate outside the United States, under the laws of the jurisdiction in which they originated.

 

 

(b)          To each Borrower’s Knowledge, no Borrower Party, nor any Person who owns a direct interest in any Borrower, nor any Person providing funds to any Borrower (excluding Administrative Agent, Lenders and public shareholders of REIT) (i) is under investigation by any Governmental Authority for, or has been charged with, or convicted of, money laundering, drug trafficking, terrorist related activities, any crimes which in the United States would be predicate crimes to money laundering, or any violation of any Anti-Money Laundering Laws; (ii) has been assessed civil or criminal penalties under any Anti-Money Laundering Laws; and (iii) has had any of its/his/her funds seized or forfeited in any action under any Anti-Money Laundering Laws.

 

(c)          Borrowers shall make payments on the Loan using funds invested in Borrowers, rental payments or other ordinary course payments received by Borrowers or insurance proceeds unless otherwise agreed to by Administrative Agent.

 

(d)          To Borrowers’ Knowledge, prior to and as of the Closing Date and at all times during the term of the Loan, all revenues arising from the Projects are and will be derived from lawful business activities of Tenants and Operators of the Projects or other permissible sources under U.S. law. On the Maturity Date, Borrowers will take reasonable steps to verify that funds used to repay the Loan in full (whether in connection with a refinancing, asset sale or otherwise) are from sources permissible under U.S. law and to the extent such funds originate outside the United States, permissible under the laws of the jurisdiction in which they originated.

 

(e)          Each Borrower Party and Person who owns a direct interest in any Borrower is now, and each Borrower will remain in compliance (and will cause each Borrower Party and Person who owns a direct interest in any Borrower to remain in compliance) with the Office of Foreign Assets Control sanctions and regulations promulgated under the authority granted by the Trading with the Enemy Act (“TWEA”), 50 U.S.C. App. Section 1 et seq. and the International Emergency Economic Powers Act (“IEEPA”), 50 U.S.C. Section 1701 et seq., as the TWEA and the IEEPA may apply to such Borrower’s activities;

 

(f)          Each Borrower Party and Person who owns a direct interest in any Borrower is now, and each Borrower will remain in compliance (and will cause each Borrower Party and Person who owns a direct interest in any Borrower to remain in compliance) with (i) the Patriot Act and all rules and regulations promulgated under the Patriot Act applicable to Borrowers and (ii) other federal or state laws relating to “know your customer” and other anti-money laundering rules and regulations; and

 

 

(g)          Each Borrower Party and Person who owns a direct interest in any Borrower (i) is not now, nor has ever been, under investigation by any Governmental Authority for, nor has been charged with or convicted for a crime under, 18 U.S.C. Sections 1956 or 1957 or any predicate offense thereunder, or a violation of the Bank Secrecy Act; (ii) has never been assessed a civil penalty under any Anti-Money Laundering Laws or predicate offenses thereunder; (iii) has not had any of its funds seized, frozen or forfeited in any action relating to any Anti-Money Laundering Laws or predicate offenses thereunder; (iv) has taken such steps and implemented such policies as are reasonably necessary to ensure that such party is not promoting, facilitating or otherwise furthering, intentionally or unintentionally, the transfer, deposit or withdrawal of criminally derived property, or of money or monetary instruments which are (or which such party suspects or has reason to believe are) the proceeds of any illegal activity or which are intended to be used to promote or further any illegal activity; and (v) has taken such steps and implemented such policies as are reasonably necessary to ensure that such party is in compliance with all laws and regulations applicable to its business for the prevention of money laundering and with anti-terrorism laws and regulations, with respect both to the source of funds from its investors and from its operations, and that such steps include the development and implementation of an anti-money laundering compliance program within the meaning of Section 352 of the Patriot Act, to the extent any such party is required to develop such a programs under the rules and regulations promulgated pursuant to Section 352 of the Patriot Act.

 

Section 5.21         Management Agreements. A true, correct and complete copy of each Management Agreement, together with all amendments thereto, has been delivered to Administrative Agent; and the Management Agreement and all amendments thereto are in full force and effect as of the Closing Date.

 

Section 5.22         Physical Condition. Except as specifically set forth in the Property Condition Reports, to each Borrower’s Knowledge, (a) the Projects, including, without limitation, all buildings, improvements, parking facilities, sidewalks, storm drainage systems, roofs, plumbing systems, HVAC systems, fire protection systems, electrical systems, equipment, elevators, exterior sidings and doors, landscaping, irrigation systems and all structural components located thereon, are in good condition, order and repair in all material respects; subject to ordinary wear and tear; and (b) there exists no structural or other material defects or damages in the Projects. No Borrower has received written notice from any insurance company or bonding company of any defects in any Project, or any part thereof, which would adversely affect the insurability of the same or cause the imposition of extraordinary premiums or charges thereon or of any termination or threatened termination of any policy of insurance or bond.

 

Section 5.23         No Change in Facts or Circumstances; Disclosure. There has been no material adverse change in any condition, fact, circumstance or event that would make the most recently delivered financial statements, rent rolls, reports, certificates or other documents submitted in connection with the Loan inaccurate, incomplete or otherwise (when taken as a whole) misleading in any material respect or that otherwise materially and adversely affects the business operations or the financial condition of Borrowers or the Projects.

 

Section 5.24         Healthcare Representations. Each Borrower represents and warrants to Administrative Agent and Lenders that:

 

(a)          (i) Each Project is being operated as a memory care, assisted living or similarly designated senior living facility having the number of Residential Units as set forth on Exhibits A-1 through A-23 attached hereto, (ii) each Project is in conformance in all material respects with all insurance, reimbursement, and cost reporting requirements, and, if applicable, has or has applied for a current provider agreement that is, or will be, in full force and effect under Medicare and Medicaid, and (iii) each Project is in compliance with all applicable Requirements of Law, except, in each case, where the failure to be in compliance would not have a Material Adverse Effect. With respect to each Project, there is no threatened in writing, existing or pending revocation, suspension, termination, probation, restriction, limitation, or nonrenewal proceeding by any third-party payor, including Medicare, Medicaid, Blue Cross, Blue Shield or any other private commercial insurance managed care and employee assistance program listed on Schedule 5.24(a) (such programs, the “Third-Party Payor Programs”), to which any Borrower or any Operator may presently be subject with respect to any Project that would be reasonably likely to have a Material Adverse Effect.

 

 

(b)          All Primary Licenses necessary for using and operating the Projects for the uses described in clause (a), above, are listed on Schedule 5.24(b), are either held by, or will be held by the applicable Borrower, or the applicable Operator, as required under applicable Law, and are in full force and effect, unless failure to have same would not be reasonably likely to have a Material Adverse Effect.

 

(c)          To Borrowers’ Knowledge and except as set forth on Schedule 5.24(c) hereof, with respect to any Project, there are no inquiries, investigations, probes, audits or proceedings by any Governmental Authority or notices thereof, or any other third party or any patient, employee or resident (including, but not limited to, whistleblower suits, or suits brought pursuant to federal or state “false claims acts” and Medicaid, Medicare or state fraud and/or abuse laws) that are reasonably likely directly or indirectly, or with the passage of time (i) to have a Material Adverse Effect on Operators’ ability to accept and/or retain patients or residents or operate such Project for its current use or result in the imposition of a fine, a sanction, a lower rate certification or a lower reimbursement rate for services rendered to eligible patients or residents, (ii) to modify, limit or result in the transfer, suspension, revocation or imposition of probationary use of any of the Primary Licenses, (iii) to affect any Operator’s continued participation in the Medicaid or Medicare programs or any other Third-Party Payor Programs, or any successor programs thereto, or (iv) result in any other civil or criminal penalty or remedy, or which could result in the appointment of a receiver, all except to the extent same would not be reasonably likely to have a Material Adverse Effect.

 

(d)          Except as set forth on Schedule 5.24(d), no Project has received a notice of violation at a level that under applicable Law requires the immediate or accelerated filing of a plan of corrections, and no statement of charges or deficiencies has been made or penalty enforcement action has been undertaken against any Project, no Operator currently has outstanding any violation with respect to the Project, and no statement of charges or deficiencies has been made or penalty enforcement action has been undertaken each that remain outstanding against any Project, any Operator with respect to the Project or, to Borrowers’ Knowledge, against any officer, director, partner, member or stockholder of any Operator, by any Governmental Authority in each case that would be reasonably expected to result in a Material Adverse Effect, and there have been no violations threatened against any Project’s, or any Operator’s certification for participation in Medicare or Medicaid or the other Third-Party Payor Programs that remain open or unanswered except to the extent same would not be reasonably likely to have a Material Adverse Effect.

 

(e)          No current, pending or outstanding Third-Party Payor Programs reimbursement audits, appeals or recoupment efforts are actually pending at any Project, and there are no years that are subject to an open audit in respect of any Third-Party Payor Program that would, in each case, adversely affect any Operator, other than customary audit rights pursuant to Medicare/Medicaid/TRICARE programs or other Approved Insurer’s programs that would not materially adversely affect Operators or Borrowers.

 

 

(f)          Neither Borrowers nor Operating Tenants have received federal funds authorized under the Hill-Burton Act (42 U.S.C. 291, et seq.), as it may be amended.

 

(g)          With respect to any Project, the patient and resident care agreements are in compliance with Healthcare Laws except to the extent that such failure would not be reasonably likely to have a Material Adverse Effect.

 

(h)          There exist no Healthcare Investigations affecting any Project that could reasonably be expected to result in a Material Adverse Effect.

 

ARTICLE 6

 

FINANCIAL REPORTING

 

Section 6.1           Financial Statements. Borrowers shall furnish to Administrative Agent and shall cause each other Borrower Party to furnish to Administrative Agent such financial statements and other financial information as required pursuant to this Article 6 and such other financial information as Administrative Agent may reasonably request from time to time. All such financial statements shall accurately and fairly present the results of operations and the financial condition of Borrowers and their subsidiaries on a consolidated basis at the dates and for the period indicated, shall be in scope and detail reasonably satisfactory to Administrative Agent and shall be otherwise sufficient to permit Administrative Agent and Lenders to calculate or verify Borrowers’ compliance with the financial covenants in Section 7.13. All financial statements shall be delivered in Excel format.

 

(a)          Financial Information. In furtherance of the foregoing, Borrowers will furnish to Administrative Agent (or cause to be furnished to Administrative Agent) the following financial information and reports with respect to each Borrower Party and/or each Project, in each case in form and format and providing information reasonably satisfactory to Administrative Agent in its reasonable discretion:

 

(i)          within fifty (50) days after the end of each calendar month, (A) internally prepared monthly financial statements (including income statements and balance sheets) prepared for Borrowers and each Project which fairly present the financial condition for Borrowers and each Project for such period and year-to-date and (B) a current rent roll or Census Report which includes a schedule showing payor mix in respect of Third Party Payor Programs for each Project;

 

(ii)         within fifty (50) days after the end of each calendar quarter, (A) a detailed operating statement (showing quarterly activity and year-to-date) stating operating revenues, operating expenses and operating income, income statement, and balance sheet for the calendar quarter just ended and year-to-date for each Project and information sufficient to confirm that the Debt Yield and Debt Service Coverage covenants set forth in Section 7.13 have been satisfied for the applicable calendar quarter, and (B) a current rent roll or Census Report which includes a schedule showing payor mix in respect of Third Party Payor Programs;

 

 

(iii)        within sixty (60) days after the end of each fiscal year, internally prepared annual financial statements prepared for each Borrower in accordance with GAAP (except that it shall be acceptable for such financial statements not to contain footnotes and year-end adjustments) and based on an accrual basis of accounting consistent with industry standards;

 

(iv)        within ninety-five (95) days after the end of each fiscal year, annual consolidated audited financial statements prepared for Borrowers, each Guarantor and REIT in accordance with GAAP and prepared by a firm of independent public accountants reasonably satisfactory to Administrative Agent, it being acknowledged by Agent that KPMG US LLP shall be deemed satisfactory;

 

(v)         within fifty (50) days after the end of each calendar quarter, internally prepared quarterly financial statements (including income statements and balance sheets) prepared for Borrowers and each Guarantor which fairly present the financial condition for Borrowers and each Guarantor for such period;

 

(vi)        upon request by Administrative Agent, copies of all cost reports and rate letters filed with Medicaid or any other Third Party Payor by each Operator to the extent received by Borrowers from such Operator after the Closing Date;

 

(vii)       copies of state and local health inspection and regulatory surveys (showing violations at a G-Level or higher) and all complaint surveys, to be provided within twenty-five (25) days after the completion of such surveys; and

 

(viii)      such additional information, reports or statements regarding Borrowers, the Projects and each Guarantor as Administrative Agent may from time to time reasonably request.

 

All property related financial statements will contain the requested information on a Project by Project basis, as well as a consolidated basis.

 

(b)          Certification of Financial Statements. Each financial statement provided hereunder shall be certified by the chief financial representative of Borrowers. Borrowers will maintain a system of accounting established and administered in accordance with sound business practices to (i) permit preparation of financial statements on an accrual basis consistent with industry standards and substantially in accordance with GAAP, and (ii) provide the information required to be delivered to Administrative Agent hereunder.

 

(c)          Additional Reports. Borrowers shall deliver to Administrative Agent the following additional reports:

 

 

(i)          from time to time, if any Lender determines that obtaining appraisals is necessary in order for such Lender to comply with applicable Requirements of Law (including any appraisals required to comply with FIRREA), Borrowers shall furnish to Administrative Agent appraisal reports in form and substance and from appraisers reasonably satisfactory to Administrative Agent stating the then current fair market value of each Project; provided, however, that such report shall not be required more frequently than once during the term of the Loan unless (A) an Event of Default exists or (B) any Lender is required to obtain such report under Requirements of Law more frequently than once during the term of the Loan;

 

(ii)         within thirty (30) days following the request of Administrative Agent, a description of the type and amount of all capital expenditures at the Projects during the prior calendar year;

 

(iii)        within thirty (30) days following the request by Administrative Agent, evidence satisfactory to Administrative Agent that all federal and state taxes, including, without limitation, payroll taxes, that are due have been paid in full by each Borrower, and each other Borrower Party, to be delivered to Administrative Agent (A) with respect to federal and state taxes (other than payroll taxes), within ten (10) days after the required filing date of the applicable tax return and (B) with respect to payroll taxes, within thirty (30) days following the end of each calendar quarter;

 

(iv)        to the extent requested by Administrative Agent, copies of the regular monthly bank statements of Borrowers; and

 

(v)         if requested by Administrative Agent (which in the absence of a Potential Default or Event of Default shall not be made more than once each calendar year), a summary report listing non-residential Tenants and Operating Tenants and square footage occupied by such Tenants and Operating Tenants within fifteen (15) days after such request.

 

Section 6.2           Compliance Certificate. Within fifty (50) days after the end of each calendar quarter, Borrowers shall deliver and shall cause Guarantor to deliver such financial reports and information as Administrative Agent shall reasonably require evidencing compliance with the Guarantor’s financial covenants as set forth in the Guaranty, together with a fully completed Compliance Certificate executed by an officer of Borrowers (or of their managing member or general partner), and, if requested by Administrative Agent, back-up documentation as Administrative Agent shall reasonably require evidencing such compliance.

 

Section 6.3           Accounting Principles. All financial statements shall be prepared in accordance with GAAP (or such other accounting basis reasonably acceptable to Administrative Agent). Notwithstanding the foregoing, all financial statements delivered hereunder shall be prepared, and all financial covenants contained herein shall be calculated, without giving effect to any election under Statement of Financial Accounting Standards 159 (or any similar accounting principle) permitting a Person to value its financial liabilities at the fair value thereof.

 

Section 6.4           Access. Borrowers shall permit Administrative Agent and any Lender to examine such records, books and papers of Borrowers which reflect upon its financial condition and the income and expenses of the Projects. In the event that Borrowers fail to timely forward the financial statements required by Section 6.1 and such failure continues for thirty (30) days after written notice of such failure, Administrative Agent shall have the right to audit such records, books and papers at Borrowers’ expense.

 

 

Section 6.5           Annual Budget. Not later than January 31 of each calendar year, Borrowers will provide to Administrative Agent Borrowers’ proposed annual operating and capital improvements budget for the Projects for such calendar year.

 

Section 6.6           Books and Records/Audits. Borrowers shall keep and maintain or cause to be kept and maintained at all times at the Projects, or such other place as Administrative Agent may reasonably approve in writing, complete and accurate books of accounts and records adequate to reflect the results of the operation of the Projects and to provide the financial statements required to be provided to Administrative Agent pursuant to Section 6.1 above and copies of all written contracts, material correspondence, and other material documents affecting the Projects. Administrative Agent and its designated agents shall have the right to inspect and copy any of the foregoing. Additionally, if an Event of Default exists or if Administrative Agent or any Lender has a reasonable basis to believe that Borrowers’ records are materially inaccurate, Administrative Agent and each Lender may conduct a joint audit and determine, in such Person’s reasonable discretion, the accuracy of Borrowers’ records and computations, such audit to be at Borrowers’ expense.

 

Section 6.7           Borrower Representative.

 

(a)          Each of the entities comprising Borrowers hereby irrevocably appoints and constitutes Sponsor as its agent (“Borrower Representative”) to act on behalf of each such entity pursuant to this Agreement and the other Loan Documents in the name or on behalf of each such Borrower.

 

(b)          Each of the entities comprising Borrowers hereby irrevocably appoints and constitutes Borrower Representative as its agent to give or receive statements of account and all other notices from or to Administrative Agent with respect to the Obligations or otherwise under or in connection with this Agreement and the other Loan Documents.

 

(c)          No purported termination of the appointment of Borrower Representative as agent for Borrowers shall be effective without the prior written consent of Administrative Agent.

 

ARTICLE 7

 

COVENANTS

 

Each Borrower covenants and agrees with each Lender and Administrative Agent as follows:

 

 

Section 7.1           Transfers or Encumbrance of Property.

 

(a)          No Borrower shall cause or permit a Transfer of its fee or leasehold interest (as applicable) in any Project or any part thereof or any legal or beneficial interest therein nor permit a Transfer of an interest in any Borrower Party (in each case, a “Prohibited Transfer”) without the prior written consent of Administrative Agent and Required Lenders, other than pursuant to Leases of space in the improvements to Tenants and Operating Tenants (or other occupants as applicable) in accordance with the provisions of Article 4 or other than a Partial Release in accordance with Section 2.18 hereof; provided, however, that involuntary liens being contested pursuant to Section 11.14, and the Permitted Exceptions (such liens together with the Permitted Exceptions, collectively, the “Permitted Encumbrances”) shall not constitute Prohibited Transfers hereunder.

 

(b)          A Prohibited Transfer shall include, but not be limited to, (i) an installment sale agreement wherein any Borrower agrees to sell its Project or any part thereof for a price to be paid in installments; (ii) an agreement by any Borrower leasing all or a substantial part of its Project for other than actual occupancy by a space tenant thereunder or a sale, assignment or other transfer of, or the grant of a security interest in, any Borrower’s right, title and interest in and to any leases or any rents; (iii) if a Borrower Party is a corporation, any merger, consolidation or Transfer of such corporation’s stock or the creation or issuance of new stock in one or a series of transactions; (iv) if a Borrower Party is a limited or general partnership or joint venture, any merger or consolidation or the change, removal, resignation or addition of a general partner or the Transfer of the partnership interest of any general or limited partner or any profits or proceeds relating to such partnership interests (but not including distributions or dividends) or the creation or issuance of new partnership interests; (v) if a Borrower Party is a limited liability company, any merger or consolidation or the change, removal, resignation or addition of a managing member or non-member manager (or if no managing member, any member) or the Transfer of the membership interest of any member; or (vi) if a Borrower Party is a trust or nominee trust, any merger, consolidation or the Transfer of the legal or beneficial interest in a Borrower Party or the creation or issuance of new legal or beneficial interests.

 

(c)          Notwithstanding anything to the contrary contained in this Agreement, including, without limitation, Sections 7.1(a) and (b) above, or the other Loan Documents, (i) any Transfer that does not result in a Change of Control shall not be deemed to be a Prohibited Transfer, and (ii) any Permitted Transfer shall not be deemed to be a Prohibited Transfer and, in the case of clauses (b) and (c) of the definition of Permitted Transfer only, shall not be deemed to result in a Change of Control; provided, further, (A) Borrowers shall give Administrative Agent thirty (30) days’ prior written notice of such Transfer pursuant to clause (a) of the definition of Permitted Transfer or, with respect to clause (c) of the definition of Permitted Transfer, as soon as practicable, and (B) in any event, Administrative Agent shall have received KYC searches with respect to any Person that will, as a result of the Transfer, own twenty (20%) or more of the direct or indirect legal or beneficial ownership interests in Borrowers, with results reasonably acceptable to Administrative Agent. All expenses, if any, incurred by Administrative Agent and Lenders in connection with a Permitted Transfer or a request for a consent to a Prohibited Transfer, whether or not the Required Lenders consent to the Prohibited Transfer, shall be payable by Borrowers. Neither Administrative Agent nor any Lender shall be required to demonstrate any actual impairment of its security or any increased risk of default hereunder in order to declare the Indebtedness immediately due and payable upon a Prohibited Transfer made without Required Lenders’ consent. This provision shall apply to each and every Prohibited Transfer, whether or not the Required Lenders have consented to any previous Prohibited Transfer.

 

 

 

Section 7.2           Taxes and Utility Charges. Except to the extent sums sufficient to pay all Taxes (defined herein) have been previously deposited with Administrative Agent as part of the Tax Impound and subject to Borrowers’ right to contest in accordance with Section 11.14 hereof, Borrowers shall pay before any fine, penalty, interest or cost may be added thereto, and shall not enter into any agreement to defer, any real estate taxes and assessments, franchise taxes and charges, and other similar governmental charges or other Taxes of any kind assessed against a Project or a Borrower that may become a Lien upon the Projects or become payable during the term of the Loan. Borrowers’ compliance with Section 3.5 of this Agreement relating to impounds for Taxes shall, with respect to payment of such Taxes, be deemed compliance with this Section 7.2. Borrowers shall not suffer or permit the joint assessment of any Project with any other real property constituting a separate tax lot or with any other real or personal property. Borrowers shall promptly pay for all common area utility services provided to the Projects.

 

Section 7.3           Management.

 

(a)          Borrowers acknowledge that the Lenders are making the Loan, in part, based upon the operational expertise of each Property Manager, and each Operator. None of the Borrowers shall permit the surrender, termination, expiration, cancellation or modification or amendment in any material respect of the Management Agreements, or to enter into any other agreement relating to the management or operation of any Project with any Property Manager or any other Person, or consent to the assignment by any Property Manager of its interest under any Management Agreement, in each case without the express written consent of Administrative Agent, which consent shall not be unreasonably withheld, conditioned or delayed and shall be based upon Administrative Agent’s evaluation of the proposed substitute manager’s financial condition, credit history and creditworthiness, experience in operating and managing properties similar to the Projects, performance and compliance history in connection with healthcare facilities, reputation for honesty and integrity and prior experience with Administrative Agent and the Lenders. If at any time Administrative Agent consents to the appointment of a new Property Manager, the Management Agreement to which such Property Manager is party shall be in form and substance reasonably acceptable to Administrative Agent (provided that the form of current Management Agreements shall be deemed acceptable hereunder), and such new Property Manager and Borrowers shall, as a condition of Administrative Agent’s consent, execute a Collateral Assignment of Management Agreement in form and substance similar to the Collateral Assignment of Management Agreement executed by the applicable Property Manager as of the Closing Date. Any change in the majority ownership or Control of any Property Manager shall be cause for Administrative Agent to re-approve such Property Manager. Each Property Manager shall hold and maintain all necessary Permits and Operating Tenants shall hold and maintain all necessary Primary Licenses required by Requirements of Law to operate and manage the applicable Projects.

 

(b)          Borrowers shall use commercially reasonable efforts to cause each Operating Tenant to enforce the obligation of each Property Manager to manage the Projects for which it is the Property Manager in accordance with the applicable Management Agreement. Borrowers shall cause each Operating Tenant to (i) diligently perform and observe in all material respects all of the terms, covenants and conditions of the Management Agreements on the part of Operating Tenant to be performed and observed, (ii) promptly notify Administrative Agent of any notice received by Operators of any default by any Operator in the performance or observance of any of the material terms, covenants or conditions of the Management Agreements on the part of the Operators, to be performed and observed, and (iii) promptly upon request by Administrative Agent, deliver to Administrative Agent a copy of each financial statement, business plan, capital expenditures plan, report and estimate received by it under the Management Agreements.

 

 

(c)          Administrative Agent shall have the right to require Borrowers to replace a Property Manager with a Person which is not an Affiliate of, but is chosen by, Borrowers (if the removal is pursuant to clause (b) below) or Operating Tenant (if the removal is pursuant to clause (b) below), as applicable, and approved by Administrative Agent, such approval not to be unreasonably withheld or delayed, upon the occurrence of anyone or more of the following events: (a) at any time following the occurrence and continuance of an Event of Default and/or (b) if any Property Manager shall be in default under any Management Agreement beyond any applicable notice and cure period, which default has an adverse effect on the use or operation of a Project, or if at any time any Property Manager has engaged in gross negligence, fraud or willful misconduct or if at any time any Property Manager is insolvent or a debtor in a bankruptcy proceeding. Notwithstanding the foregoing, Administrative Agent at its reasonable discretion, may elect not to enforce the removal of the Property Manager pursuant to the preceding clause (a) if the Event of Default is not material (as determined in Administrative Agent’s reasonable discretion).

 

Section 7.4           Operation; Maintenance; Inspection. Borrowers shall observe and comply with all legal requirements applicable to the ownership, use and operation of the Projects. Borrowers shall maintain the Projects in good condition and promptly repair any damage or casualty, normal wear and tear excepted. Borrowers shall permit Administrative Agent, Lenders and their agents, representatives and employees, upon reasonable prior notice to Borrowers, to inspect the Projects and conduct such environmental and engineering studies as Administrative Agent may require, provided such inspections and studies do not materially interfere with the use and operation of the Projects.

 

Section 7.5           Taxes on Security. Borrowers shall pay all taxes, charges, filing, registration and recording fees, excises and levies payable with respect to the Note or the Liens created or secured by the Loan Documents, other than income, franchise and doing business taxes imposed on Administrative Agent or any Lender. If there shall be enacted any law (a) deducting the Loan from the value of any Project for the purpose of taxation, (b) affecting any Lien on the Projects, or (c) changing existing laws of taxation of mortgages, deeds of trust, security deeds, or debts secured by real property, or changing the manner of collecting any such taxes, Borrowers shall promptly pay to Administrative Agent, on demand, all taxes, costs and charges for which Administrative Agent or any Lender is actually liable as a result thereof; however, if such payment would be prohibited by law or would render the Loan usurious, then instead of collecting such payment, Administrative Agent may declare all amounts owing under the Loan Documents to be due and payable within ninety (90) days following receipt of such notice by Borrowers without payment of any Exit Fee.

 

 

Section 7.6           Legal Existence, Name, Etc. Each Borrower shall: (i) preserve and keep in full force and effect its existence as, and at all times operate as, a Single Purpose Entity, and (ii) shall preserve and keep in full force and effect its entity status, franchises, rights and privileges under the laws of the state of its formation, and all qualifications, licenses and permits applicable to and required for the ownership, use and operation of the Projects. Neither any Borrower nor, except as expressly permitted by this Agreement, any general partner, manager or managing member of any Borrower shall wind up, liquidate, dissolve, reorganize, merge, or consolidate with or into any Person, or permit any subsidiary of any Borrower to do so. Without limiting the foregoing, no Borrower shall reincorporate or reorganize itself under the laws of any jurisdiction other than the jurisdiction in which it is incorporated or organized as of the Closing Date. Each Borrower and each general partner, manager or managing member in each Borrower shall conduct business only in its own name and shall not change its name, identity, state of formation, or organization type, or the County in which its chief executive office or principal place of business unless such Borrower (a) shall have obtained the prior written consent of Administrative Agent to such change and (b) shall have taken all actions necessary or requested by Administrative Agent to file or amend any financing statement or continuation statement to assure perfection and continuation of perfection of security interests under the Loan Documents.

 

Section 7.7           Further Assurances. Each Borrower shall promptly (a) cure any defects in the execution and delivery of the Loan Documents and the Environmental Indemnity Agreement, (b) provide, and cause each other Borrower Party to provide, Administrative Agent such additional information and documentation on each Borrower’s and each other Borrower Party’s legal or beneficial ownership, policies, procedures, and sources of funds as Administrative Agent deems necessary or prudent to enable Administrative Agent and each Lender to comply with Anti-Money Laundering Laws as now in existence or hereafter amended, and (c) execute and deliver, or cause to be executed and delivered, all such other documents, agreements and instruments as Administrative Agent may reasonably request to further evidence and more fully describe the Collateral for the Loan, to correct any omissions in the Loan Documents or the Environmental Indemnity Agreement to perfect, protect or preserve any liens created under any of the Loan Documents and the Environmental Indemnity Agreement, or to make any recordings, file any notices, or obtain any consents, as may be necessary or appropriate in connection therewith. Each Borrower grants Administrative Agent an irrevocable power of attorney coupled with an interest for the purpose of perfecting any security interest in and to the Collateral for the Loan. Each Borrower grants Administrative Agent an irrevocable power of attorney coupled with an interest for the purpose of exercising any and all rights and remedies available to Administrative Agent and Lenders under the Loan Documents and the Environmental Indemnity Agreement, at law and in equity, including without limitation such rights and remedies available to Administrative Agent pursuant to this Section 7.7; provided that Administrative Agent shall have no right to exercise such power of attorney unless there shall be a continuing Event of Default under this Agreement. From time to time upon the reasonable written request of Administrative Agent, Borrowers shall deliver to Administrative Agent a schedule of the name, legal domicile address and jurisdiction of organization, if applicable, for each Borrower Party and each holder of a legal interest in Borrowers.

 

Section 7.8           Estoppel Certificates Regarding Loan. Borrowers, within ten (10) Business Days after request, shall furnish to Administrative Agent a written statement, duly acknowledged, setting forth the amount due on the Loan, the terms of payment of the Loan, the date to which interest has been paid, whether any offsets or defenses exist against the Loan and, if any are alleged to exist, the nature thereof in detail, and such other matters as Administrative Agent reasonably may request.

 

 

Section 7.9           Notice of Certain Events. Borrowers shall promptly notify Administrative Agent of any written notice received by Borrowers with respect to (a) violations of any laws, regulations, codes or ordinances which, in each case, could be expected to have a Material Adverse Effect; (b) any material threatened or pending legal, judicial or regulatory proceedings, including any material dispute between Borrowers and any Governmental Authority; (c) a copy of each notice of default or termination given or made to any Operator by Borrowers or received by Borrowers from any Operator; (d) [reserved]; (e) any notice of a material Healthcare Investigation; and (f) any threatened or pending legal, judicial or regulatory proceedings pertaining to a material Healthcare Investigation; and in the case of clauses (a), (b), (c), (d), (e) or (f), promptly provide Administrative Agent with copies of such notices referred to therein.

 

Section 7.10         Payment for Labor and Materials. Subject to Borrowers’ right to contest in accordance with Section 11.14 hereof, Borrowers will promptly pay or cause to be paid when due all bills and costs for labor, materials, and specifically fabricated materials incurred by Borrower in connection with Borrower’s fee or leasehold interest in the Projects and never permit to exist beyond the due date thereof in respect of Borrowers’ fee or leasehold interest in any such Project, any Lien, even though inferior to the Liens hereof, and in any event never permit to be created or exist in respect of Borrowers’ fee or leasehold interest in any such Project or any part thereof any other or additional Lien other than the Liens hereof and except for the Permitted Exceptions; provided that nothing herein shall limit any Borrower’s obligations under this Agreement to enforce the terms and conditions of the Leases.

 

Section 7.11         Use and Proceeds, Revenues. Borrowers shall use the proceeds of the Loan for business purposes. No portion of the proceeds of the Loan shall be used by Borrowers in any manner that might cause the borrowing or the application of such proceeds to violate Regulation D, Regulation T or Regulation X or any other regulation of the Board of Governors of the Federal Reserve System or to violate the Securities Act of 1933 or the Securities Exchange Act of 1934. No portion of the Loan will be funded or held with “plan assets” within the meaning of Section 3(42) of ERISA if it would result in a non-exempt prohibited transaction under Section 406 of ERISA or Section 4975 of the Code.

 

Section 7.12         Compliance with Laws and Contractual Obligations.

 

(a)          Borrowers will comply with and will cause Operating Tenants to comply with the Requirements of Law as are now in effect and which may be imposed upon Borrowers or Operating Tenants or the maintenance, use or operation of the Projects or the provision of services to the occupants of the Projects and the obligations, covenants and conditions contained in all other material contractual obligations of Borrowers, and as they relate to the Projects. Without limitation of the foregoing, each Borrower shall cooperate with Administrative Agent in connection with compliance with laws governing the National Federal Flood Insurance Program, including by providing any information reasonably required by Administrative Agent in order to confirm compliance with such laws.

 

(b)          Borrowers will obtain and maintain and will cause Operators to obtain and maintain, all Primary Licenses and Permits now held or hereafter required to be held by Borrowers or Operators for which the loss, suspension, revocation or failure to obtain or renew, could reasonably be expected to have a Material Adverse Effect.

 

 

 

Section 7.13         Operating and Financial Covenants. The Projects shall satisfy each of the following covenants as of the end of each calendar quarter (each a “Determination Date”):

 

(a)          Debt Service Coverage. The Projects shall have achieved a Debt Service Coverage Ratio based upon the trailing six (6) full calendar months ending on each Determination Date of at least 1.25 to 1.00 (the “Minimum Required DSC Ratio”); provided that if on any Determination Date, ANOI for the prior 6-month period is not available, the ANOI covering any lesser period of time will be annualized to determine compliance with this Section 7.13(a).

 

(b)          Debt Yield. The Debt Yield as of each Determination Date (based on the trailing six (6) full calendar months ending on the Determination Date; provided that if on any Determination Date during the first Loan Year, operating statements for the prior 6-month period are not available, the operating statements covering any lesser period of time will be annualized to determine compliance with this Section 7.14(b)) shall be equal to or greater than (i) prior to release of the Agency Disposition Assets in accordance with Section 2.18, 11.00% and (ii) after the release of the Agency Disposition Assets, (x) during the first Loan Year, eight percent (8.00%), and (y) during the second Loan Year and thereafter, nine percent (9.00%).

 

Notwithstanding anything to the contrary herein, if as of any Determination Date, the Debt Service Coverage Ratio or Debt Yield will not satisfy the requirements of Sections 7.13(a) or (b), Borrowers may elect, after providing notice with the delivery of the financial information required pursuant to Section 6.1(a)(ii), to pay down the principal balance of the Loan in an amount sufficient to cause the Debt Yield and/or Debt Service Coverage Ratio to satisfy the requirements of this Section 7.13(a) or (b), as applicable (such paydown, “Financial Covenant Cure”), so long as (a) prior to such Determination Date, all Agency Disposition Assets have been released from the Loan in accordance with Section 2.18 of this Agreement, (b) such Financial Covenant Cure may not be exercised more than twice during the term of this Agreement, and (c) such Financial Covenant Cure is made within ten (10) Business Days after the date the financial information pursuant to Section 6.1(a)(ii) is required to be delivered pursuant to the terms thereof.

 

Section 7.14         Transactions with Affiliates. Without the prior written consent of Administrative Agent, Borrowers shall not engage in any transaction affecting the Projects with an Affiliate of Borrowers, except as expressly contemplated by this Agreement or otherwise on arm’s-length market terms.

 

Section 7.15         Representations and Warranties. All of the representations and warranties in this Agreement, the other Loan Documents and the Environmental Indemnity Agreement shall be true, correct and complete in all material respects as of the Closing Date (in each case, without duplication of any materiality qualifier contained therein), except to the extent that such representation or warranty expressly relates to an earlier date (in which event such representations and warranties were true and correct in all material respects (without duplication of any materiality qualifier contained therein) as of such earlier date.

 

 

Section 7.16         Alterations. Without the prior written consent of Administrative Agent, Borrowers shall not make any alteration to any Individual Project (except tenant improvements under any lease approved by Administrative Agent by Administrative Agent under the terms of this Agreement or as may be required in an emergency) (a) that affects the structural components of the Projects, utilities, HVAC or the exterior of the Projects, (b) that are reasonably likely to cause a Material Adverse Change or (c) the cost of which (including any related alteration, improvement or replacement) is reasonably anticipated to exceed the Restoration Threshold, which approval may not be unreasonably withheld or delayed.

 

Section 7.17         Business and Operations. Borrowers will continue to engage only in the businesses currently conducted by them on the date hereof, as and to the extent the same are necessary for the ownership and leasing of the Projects. Borrowers shall at all times cause the Projects to be maintained in accordance with the Projects’ use as senior housing and healthcare facilities.

 

Section 7.18         Severability of Covenants. Any representations, warranties or covenants made by Borrowers regarding such entities or their Affiliates (as contrasted with the Projects) shall be deemed to have been made solely on behalf of such entity, and Borrowers shall not be deemed to be making such representations or covenants or warranties regarding any other entity.

 

Section 7.19         Healthcare Covenants.

 

(a)          Without limiting the generality of any other provision of this Agreement, each Borrower and Operators and their employees and contractors (other than contracted agencies) in the exercise of their duties on behalf of Borrowers or any Operator (with respect to its operation of the Projects) shall be in compliance in all material respects with all applicable Healthcare Laws. Each Borrower and each Operator shall maintain in all material respects all records required to be maintained by any Governmental Authority or otherwise under the Healthcare Laws.

 

(b)          If any Borrower or Operator is or at any time becomes a “covered entity” or subject to the “Administrative Simplification” provisions of HIPAA, then such Persons (x) will promptly undertake all necessary surveys, audits, inventories, reviews, analyses and/or assessments (including any necessary risk assessments) of all areas of its business and operations required by HIPAA and/or that could be adversely affected by the failure of such Person(s) to be HIPAA Compliant (as defined below); (y) will promptly develop a detailed plan and time line for becoming HIPAA Compliant (a “HIPAA Compliance Plan”); and (z) will implement those provisions of such HIPAA Compliance Plan in all material respects necessary to ensure that such Person(s) are or become HIPAA Compliant. For purposes hereof, “HIPAA Compliant” shall mean that each Borrower and each Operator, as applicable (A) is or will be in material compliance with each of the applicable requirements of HIPAA on and as of each date that any party thereof, or any final rule or regulation thereunder, becomes effective in accordance with its or their terms, as the case may be (each such date, a “HIPAA Compliance Date”), and (B) is not and would not reasonably be expected to become, as of any date following any such HIPAA Compliance Date, the subject of any civil or criminal penalty, process, claim, action or proceeding, or any administrative or other regulatory review, survey, process or proceeding (other than routine surveys or reviews conducted by any government health plan or other accreditation entity) that could result in any of the foregoing or that could reasonably be expected to adversely affect any Borrower’s or any Operator’s business, operations, assets, properties or condition (financial or otherwise), in connection with any actual or potential violation by Borrowers or any Operator of the then effective provisions of HIPAA.

 

 

(c)          If and to the extent required under applicable Requirements of Law, each Borrower and/or each Operator shall maintain in full force and effect throughout the term of the Loan (i) all Primary Licenses, Permits and other Governmental Approvals necessary to own and operate the Projects for the requisite number of Residential Units in the Projects, free from restrictions, and such Primary License shall not be provisional, probationary or restricted in any manner, and (ii) a provider agreement or other required documentation of approved provider status for each Third Party Payor Programs, if applicable. The Projects shall be operated in a manner such that the Primary Licenses shall remain in full force and effect.

 

(d)          Neither any Borrower nor any Operator shall do (or suffer to be done) any of the following with respect to any Project:

 

(i)          Transfer the Primary Licenses to any location other than the Projects;

 

(ii)         Rescind, withdraw or revoke the Primary Licenses, or otherwise amend the Primary Licenses in such a manner that results in a material adverse effect on the rates charged or otherwise diminish or impair the nature, tenor or scope of the Primary Licenses without Administrative Agent’s consent;

 

(iii)        Amend or otherwise change any Project’s authorized units/beds capacity and/or the number of Residential Units to decrease by more than five percent (5%) the number of units/beds permitted with respect to such Project under the Primary License or otherwise approved by the State Regulator, if applicable, provided that the number of authorized units/beds capacity and/or the number of Residential Units with respect to Agency Disposition Assets shall not be amended or changed in any respect.

 

(iv)        Replace or transfer all or any part of any Project’s Residential Units to another site or location other than to another Project; or

 

(v)         Voluntarily transfer or encourage the transfer of any resident of any Project to any other facility (other than to another Project), unless such transfer is (A) at the request of the resident, (B) for reasons relating to the health, required level of medical care or safety of the resident to be transferred or the residents remaining at the facility or (C) as a result of the disruptive behavior of the transferred resident that is detrimental to the facility.

 

(e)          If Borrowers or Operators participate in any Medicare or Medicaid or other Third Party Payor Programs with respect to the Projects, Borrowers will cause the Projects to remain in (i) material compliance with all requirements necessary for participation in Medicare and Medicaid, including the Medicare and Medicaid Patient Protection Act of 1987, as it may be amended, and such other Third Party Payor Programs and (ii) conformance in all material respects with all insurance, reimbursement and cost reporting requirements under Medicare and Medicaid.

 

 

(f)          Borrowers will promptly, but no later than five (5) Business Days after receipt of any notice regarding (i) an adverse survey of a Project resulting in an “Immediate Jeopardy” citation, or (ii) a Healthcare Investigation, provide to Administrative Agent notice of the same and thereafter promptly provide the following information with respect thereto (to the extent applicable and available): (A) a copy of the survey and/or a description of the Healthcare Investigation, (B) number of records requested, (C) dates of service, (D) dollars at risk, (E) date records submitted, (F) determinations, findings, results and denials (including number, percentage and dollar amount of claims denied, (G) additional remedies (state or federal) proposed or imposed (including, civil money penalties, denial of payment for new admissions, administrative state penalties or any termination of a Third Party Payor Program, (H) status update, including appeals, and (I) any other pertinent information related thereto. In addition, Borrowers will provide notice to Administrative Agent of the imposition of any type of restrictions or suspensions on any Primary License or the evacuation of residents from any Project for 24 hours or more, in each case within five (5) Business Days following such event.

 

Section 7.20         Cooperation Regarding Primary Licenses and Permits From time to time, upon the request of Administrative Agent, if an Event of Default is continuing hereunder and to the extent permitted by applicable Requirements of Law, Borrowers shall, and shall cause Operators to, complete, execute and deliver to Administrative Agent any applications, notices, documentation, and other information necessary, in Administrative Agent’s judgment, to permit Administrative Agent or its designee (including a receiver) to obtain, maintain or renew any one or more of the Primary Licenses for the Projects (or to become the owner of the existing Primary Licenses for the Projects) and to the extent permitted by applicable Requirements of Law, to obtain any other provider agreements or Governmental Approvals then necessary or desirable for the operation of the Projects by Administrative Agent or its designee for their current use (including any applications for change of ownership of the existing Primary Licenses or change of control of the owner of the existing Primary Licenses). To the extent not prohibited by applicable Requirements of Law, (i) Administrative Agent is hereby authorized (without the consent of Borrowers or Operators but with notice) to submit any such applications, notices, documentation or other information which Borrowers caused to be delivered to Administrative Agent in accordance with the immediately preceding sentence to the applicable Governmental Authorities, or, in connection with the foregoing, to take such other steps as Administrative Agent may deem advisable to obtain, maintain or renew any Primary License or Permits or other Governmental Approvals in connection with the operation of the Projects for their current use, and Borrowers agree to cooperate and to cause Operators to cooperate with Administrative Agent in connection with the same and (ii) Borrowers, upon demand by Administrative Agent, shall take any action and cause Operators to take any action necessary or desirable, in Administrative Agent’s sole judgment, to permit Administrative Agent or its designee (including a receiver) to use, operate and maintain the Projects for its current use after written notice. If Borrowers fail promptly to comply with the provisions of this Section 7.20 for any reason whatsoever, Borrowers hereby (to the extent not prohibited by applicable Requirements of Law) irrevocably appoint Administrative Agent and its designee as Borrowers’ attorney-in-fact, with full power of substitution, to take any action and execute any documents and instruments necessary or desirable in Administrative Agent’s sole judgment to permit Administrative Agent or its designee to undertake Borrowers’ obligations under this Section 7.20, including obtaining any Primary Licenses or Governmental Approvals then required for the operation of the Projects by Administrative Agent or its designee for their current uses. The foregoing power of attorney is coupled with an interest and is irrevocable and Administrative Agent may exercise its rights thereunder in addition to any other remedies which Administrative Agent may have against Borrowers or any other Borrower Party as a result of Borrowers’ breach of the obligations contained in this Section 7.20.

 

  

Section 7.21        Required Repairs and Post Closing Obligations. Borrowers shall provide evidence reasonably satisfactory to Administrative Agent that the Required Repairs have been completed within the time periods set forth on Schedule 11.37, as the case may be, as may be extended, if at all, in Administrative Agent’s discretion, all of which shall be performed in a manner reasonably satisfactory to Administrative Agent and in accordance with all Requirements of Law and shall be subject to inspection by Administrative Agent (at Administrative Agent’s option) during reasonable business hours upon reasonable advance written notice. Borrowers shall also satisfy the Post Closing Obligations within the time periods set forth on Schedule 11.37.

 

ARTICLE 8

 

EVENTS OF DEFAULT

 

Each of the following shall constitute an “Event of Default” hereunder and under the Loan:

 

Section 8.1           Payments. Failure of Borrowers to pay any regularly scheduled installment of principal, interest or other amount due under the Loan Documents within five (5) days after the date when due, or failure of Borrowers to pay the Loan at the Maturity Date, whether by acceleration or otherwise.

 

Section 8.2           Insurance. Borrowers’ failure to maintain insurance as required under Section 3.1 of this Agreement.

 

Section 8.3           Prohibited Transfer. A Prohibited Transfer occurs, in violation of this Agreement.

 

Section 8.4           Covenants. Subject to any shorter period for curing any failure by Borrowers as specified in any of the other Loan Documents or Environmental Indemnity Agreement, Borrowers’ failure to perform, observe or comply with any of the agreements, covenants or provisions contained in this Agreement or in any of the other Loan Documents or Environmental Indemnity Agreement (other than those agreements, covenants and provisions referred to elsewhere in this Article 8), and the continuance of such failure for thirty (30) days after notice by Administrative Agent to Borrower Representative; provided, however, subject to any shorter period for curing any failure by Borrowers as specified in any of the other Loan Documents or Environmental Indemnity Agreement, Borrowers shall have an additional sixty (60) days to cure such failure if (a) such failure does not involve the failure to make payments on a monetary obligation; (b) such failure cannot reasonably be cured within thirty (30) days; and (c) Borrowers are diligently undertaking to cure such default. The notice and cure provisions of this Section 8.4 do not apply to the other Events of Default described in this Article 8 or to Borrowers’ failure to perform, observe or comply with any of the agreements, covenants or provisions referenced elsewhere in this Article 8 (for which no notice and cure period shall apply).

 

 

Section 8.5           Representations and Warranties. Any representation or warranty made in any Loan Document, the Environmental Indemnity Agreement or any Compliance Certificate proves to be untrue in any material respect when made.

 

Section 8.6           Other Encumbrances. Any material default by any Borrower under any material document or instrument, other than the Loan Documents, evidencing or creating a Lien on any Project or any part thereof, is not cured within any applicable grace or cure period therein.

 

Section 8.7           Collateral. Administrative Agent ceases to have a valid security interest in the Collateral or such security interest pursuant to the terms hereof shall for any reason cease to be a perfected and first priority security interest and Borrowers fail to cooperate and consummate the correction of such defects within ten (10) Business Days.

 

Section 8.8           Involuntary Bankruptcy or Other Proceeding. Commencement of an involuntary case or other proceeding against any Borrower or any other Borrower Party (each, a “Bankruptcy Party”) which seeks liquidation, reorganization or other relief with respect to it or its debts or other liabilities under any bankruptcy, insolvency or other similar law now or hereafter in effect or seeks the appointment of a trustee, receiver, liquidator, custodian or other similar official of it or any of its property, and such involuntary case or other proceeding shall remain undismissed or unstayed for a period of ninety (90) days; or an order for relief against a Bankruptcy Party shall be entered in any such case under the Federal Bankruptcy Code.

 

Section 8.9           Voluntary Petitions, Etc. Commencement by a Bankruptcy Party of a voluntary case or other proceeding seeking liquidation, reorganization or other relief with respect to itself or its Debts or other liabilities under any bankruptcy, insolvency or other similar law or seeking the appointment of a trustee, receiver, liquidator, custodian or other similar official for it or any of its property, or consent by a Bankruptcy Party to any such relief or to the appointment of or taking possession by any such official in an involuntary case or other proceeding commenced against it, or the making by a Bankruptcy Party of a general assignment for the benefit of creditors, or the failure by a Bankruptcy Party, or the admission by a Bankruptcy Party in writing of its inability, to pay its debts generally as they become due, or any action by a Bankruptcy Party to authorize or effect any of the foregoing.

 

Section 8.10         Default Under Operators’ Agreements. The occurrence of an event of default by Borrowers under any of the Operators’ Agreements which remains uncured beyond any applicable grace or cure periods.

 

Section 8.11         [Reserved].

 

Section 8.12         Certain Covenants. Any Borrower’s failure to (i) maintain its status as a Single Purpose Entity; (ii) timely deliver the Compliance Certificate and the continuance of such failure for three (3) Business Days after notice by Administrative Agent to Borrower Representative; (iii) comply with the provisions of Section 7.1; (iv) comply with the provisions of Section 7.13; (v) comply with the provisions of Section 7.19; or (vi) provide Administrative Agent with ten (10) Business Days subsequent written notice of changes of the state of any Borrower’s formation or any Borrower’s name.

 

 

Section 8.13        Financial Information. Subject to Subject to Section 8.12, Borrowers’ failure to deliver financial statements and reports as required by Article 6 and the continuance of such failure for three (3) Business Days after notice by Administrative Agent to Borrower Representative.

 

Section 8.14        Default Under Recourse Guaranty Agreement. The occurrence of a default under the Recourse Guaranty Agreement and such default is not cured within any grace or cure periods provided therein.

 

Section 8.15        Criminal Act. Any Borrower Party is convicted of a felony involving fraud or embezzlement or moral turpitude.

 

Section 8.16       Environmental Indemnity Agreement. There shall have occurred any default under the Environmental Indemnity Agreement which remains uncured beyond any applicable grace or cure periods available under the Environmental Indemnity Agreement.

 

Section 8.17        Required Repairs and Post Closing Obligations. The failure to complete the Required Repairs or satisfy the Post Closing Obligations within the time periods set forth on Schedule 11.37 subject to force majeure.

 

Section 8.18        Secured Hedge Agreement. The occurrence of a default by any Borrower Party under a Secured Hedge Agreement, if any, which remains uncured beyond any applicable grace or cure periods provided therein.

 

Section 8.19       Admissions Restrictions. Other than with respect to the Specified Oregon Restriction, any Governmental Authority ceases to permit new residents or tenants to be admitted to any of the Projects or causes any of the Operators to discharge any residents or tenants from any of the Projects.

 

Section 8.20       Healthcare Investigations. The occurrence of a Healthcare Investigation affecting any of the Projects, that could reasonably be expected to result in a Material Adverse Effect.

 

Section 8.21        Change of Control. A Change of Control occurs.

 

 

Notwithstanding anything to the contrary in this Section 8, Borrowers may cure any Project specific Event of Default arising pursuant to Sections 8.2, 8.4, 8.5, 8.6, 8.10, 8.12, 8.16, 8.17, 8.19 or 8.20 and which can be cured by removing such Project from the Loan, by effecting a Partial Release of such Project pursuant to Section 2.18 of this Agreement, so long as (a) the Administrative Agent in its reasonable discretion determines that such Event of Default is limited to such Project and the nature of such Event of Default is such that it is not reasonably likely to become an Event of Default with respect to or otherwise adversely affect other Projects in the future and (b) such removal occurs within ten (10) Business Days after the applicable Event of Default arising with respect to such Project, provided, however, for purposes of this paragraph, Section 2.18(a)(i) and Section 2.18(a)(iii) shall not be applicable (except that no other Event of Default shall be outstanding). From the date Borrower notifies Administrative Agent that Borrower plans to undertake the Partial Release of the applicable Project in accordance with the foregoing sentence until Borrowers complete such Partial Release, Administrative Agent and Lenders shall forbear from exercising any remedies available solely as result of such Event of Default pursuant to this Loan Agreement or any other Loan Documents and upon completion of such Partial Release the applicable Event of Default that arose with respect to the applicable Partial Release Project shall be deemed cured and no longer continuing.

 

ARTICLE 9

 

REMEDIES

 

Section 9.1           Remedies – Insolvency Events. Upon the occurrence of any Event of Default described in Sections 8.8 or 8.9, all amounts due under the Loan Documents (excluding the Secured Hedge Agreements) immediately shall become due and payable, all without written notice and without presentment, demand, protest, notice of protest or dishonor, notice of intent to accelerate the maturity thereof, notice of acceleration of the maturity thereof, or any other notice of default of any kind, all of which are hereby expressly waived by Borrowers; however, if the Bankruptcy Party under Sections 8.8 or 8.9 is other than Borrowers, then all amounts due under the Loan Documents shall become immediately due and payable at Administrative Agent’s election, in Administrative Agent’s sole discretion.

 

Section 9.2           Remedies – Other Events; Protective Advances.

 

(a)          Remedies – Other Events. Except as set forth in Section 9.1 above, while any Event of Default exists, Administrative Agent may, and at the direction of the Required Lenders shall, (a) by written notice to Borrowers, declare the entire Loan to be immediately due and payable without presentment, demand, protest, notice of protest or dishonor, notice of intent to accelerate the maturity thereof, notice of acceleration of the maturity thereof, or other notice of default of any kind, all of which are hereby expressly waived by Borrowers, (b) exercise all rights and remedies therefor under the Loan Documents and at law or in equity, and (c) make Protective Advances that Administrative Agent determines as necessary to protect or maintain the Collateral. Notwithstanding anything to the contrary contained in the Loan Documents or the Environmental Indemnity Agreement, the enforcement of the obligations of Borrowers and the other Borrower Parties under the Loan Documents and the Environmental Indemnity Agreement and the exercise of rights and remedies thereunder shall be undertaken solely by Administrative Agent in its capacity as agent for Lenders.

 

 

(b)          Protective Advances. All losses incurred in connection with the Loan (including with respect to interest (including interest at the Default Rate) and other sums payable pursuant to the Notes), the enforcement thereof, or the realization of the security therefor, shall be borne by Lenders in accordance with their respective pro rata share of the Loan. In addition, Lenders shall promptly, upon request by Administrative Agent, remit to Administrative Agent their respective pro rata share of any advances or disbursements made or to be made to pay taxes (including special assessments or payments in lieu of real estate taxes), maintenance costs, ground rent, insurance premiums or other items which Administrative Agent or Required Lenders determine are necessary to preserve the Lien (or priority of the Lien) on any Collateral from any intervening lien, forfeiture, casualty, loss, waste or other impairment, diminution or reduction in value or to preserve, protect, sell, operate, manage, lease, improve, maintain, repair, defend or dispose of any Collateral or any portion thereof), whether or not the amount necessary to be advanced for such purposes exceeds the amount of the Loan (all such advances, collectively, “Protective Advances”). Each Lender’s pro rata share of any Protective Advance shall constitute obligatory advances of that Lender under this Agreement, shall be payable by each Lender on demand by Administrative Agent and secured by the Collateral, and, if unpaid by any Lender as set forth below, such Lender’s pro rata share thereof shall bear interest at the rate applicable to such amount under the Loan (or, if no longer applicable, at the Base Rate). Administrative Agent shall notify each Lender in writing of its pro rata share of each Protective Advance. Upon receipt of notice from Administrative Agent of its making of a Protective Advance, each Lender shall make the amount of such Lender’s pro rata share of the Protective Advance available to Administrative Agent, in same day funds, to such account of Administrative Agent as Administrative Agent may designate, (i) on or before 3:00 p.m. (Eastern Standard or Daylight Savings time) on the day Administrative Agent provides Lenders with notice of the making of such Protective Advance if Administrative Agent provides such notice on or before 12:00 p.m. (Eastern Standard or Daylight Savings time), or (ii) on or before 12:00 p.m. on the Business Day immediately following the day Administrative Agent provides Lenders with notice of the making of such advance if Administrative Agent provides notice after 12:00 p.m. (Eastern Standard or Daylight Savings time).

 

Section 9.3           Administrative Agent’s Right to Perform the Obligations. If Borrowers shall fail, refuse or neglect to make any payment or perform any act required by the Loan Documents or the Environmental Indemnity Agreement, then while any Event of Default exists, and without notice to or demand upon Borrowers and without waiving or releasing any other right, remedy or recourse Administrative Agent may have because of such Event of Default, Administrative Agent may (but shall not be obligated to) make such payment or perform such act for the account of and at the expense of Borrowers, and shall have the right to enter upon the Projects for such purpose and to take all such action thereon and with respect to the Projects as it may deem necessary or appropriate. If Administrative Agent shall elect to pay any sum due with reference to the Projects, Administrative Agent may do so in reliance on any bill, statement or assessment procured from the appropriate Governmental Authority or other issuer thereof without inquiring into the accuracy or validity thereof. Similarly, in making any payments to protect the security intended to be created by the Loan Documents, Administrative Agent shall not be bound to inquire into the validity of any apparent or threatened adverse title, lien, encumbrance, claim or charge before making an advance for the purpose of preventing or removing the same. Borrowers shall indemnify, defend and hold Administrative Agent harmless from and against any and all losses, liabilities, claims, damages, expenses, obligations, penalties, actions, judgments, suits, costs, or disbursements of any kind or nature whatsoever, including reasonable attorneys’ fees, actually incurred by reason of any acts performed by Administrative Agent pursuant to the provisions of this Section 9.3, including those arising from the joint, concurrent, or comparative negligence of Administrative Agent. All sums paid by Administrative Agent pursuant to this Section 9.3, and all other sums expended by Administrative Agent to which it shall be entitled to be indemnified, together with interest thereon at the Default Rate from the date of such payment or expenditure until paid, shall constitute additions to the Loan, shall be secured by the Loan Documents and shall be paid by Borrowers to Administrative Agent upon demand.

 

 

Section 9.4           Special Right to Cure with Respect to Operational Defaults. Notwithstanding anything contained in Article 8, if an Event of Default occurs under Sections 8.10, 8.12(v), 8.19, or 8.20 as a result of any act or omission of any Operator (and such act, omission or failure is outside Borrowers’ control and not otherwise caused by Borrowers) (an “Operational Default”), such Operational Default shall not constitute an “Event of Default” under any such Section if (and only if) all of the following conditions are satisfied as determined by Administrative Agent in its reasonable discretion:

 

(a)          There exists no other Event of Default hereunder.

 

(b)          Borrowers send notice to Administrative Agent describing in reasonable detail the Operational Default.

 

(c)          Neither the value of the Security nor the ability to operate the Projects is materially impaired as a result of the act or omission that caused the Operational Default.

 

(e)          Borrowers diligently pursue all rights and remedies available to Borrowers under the applicable Operators Agreement and under Requirements of Law to (i) cure (or cause the applicable Operator to cure) such Operational Default, and if the applicable Borrower(s) elect to cure (or cause the applicable Operator to cure) such Operational Default, and such Operational Default is actually cured within ninety (90) days of the occurrence of such Operational Default (such ninety (90) day period from the occurrence of the Operational Default is referred to as the “Forbearance Period”; provided that, solely to the extent necessary to cause the transfer of Primary Licenses to a new Operator if necessary, the Forbearance Period shall be extended by sixty (60) days to complete such transfer so long as the applicable Operator is diligently pursuing such transfer at all times during such period) or (ii) at any time during the Forbearance Period, terminate the applicable Management Agreement and install a new property manager to operate the applicable Project(s) (the “Replacement Operator”). If the Borrowers elect to install a Replacement Operator, the Replacement Operator shall be acceptable to Administrative Agent in its sole discretion and upon approval by Administrative Agent, shall thereafter be deemed to be one of the “Operators” for all purposes hereunder and under the other Loan Documents. If (A) the termination of the existing applicable Operator Agreement and removal of the defaulting Operator results in the need to obtain a new Primary License in order for the Replacement Operator to operate the affected Project, (B) the Replacement Operator (or Borrowers) are able to continue to operate the affected Project under the prior Primary License or other temporary authority of the State Regulator, and (C) Borrowers are diligently pursuing (or causing the Replacement Operator to diligently pursue) the satisfaction of all regulatory and licensing requirements necessary to permit the Replacement Operator to operate the applicable Project, the Forbearance Period shall be automatically extended for an additional period as is deemed reasonably necessary by Administrative Agent to obtain the required Primary License. If at the expiration of such extended Forbearance Period, the required Primary License has not been issued to the Replacement Operator for the affected Project, then Borrowers shall prepay the Loan in an amount equal to the Partial Release Price for the affected Project within ten (10) days of such expiration, such prepayment shall cure such Event of Default, and after such prepayment, so long as the conditions in Section 2.18 have been satisfied (except that, for purposes of this sentence, Section 2.18(a)(i) and Section 2.18(a)(iii) shall not be applicable (except that no other Event of Default shall be outstanding)), the Administrative Agent shall release the affected Project from the Loan.

 

 

(f)          If the Borrowers elect to install a Replacement Operator, then not later than the end of the Forbearance Period, Borrowers cause such Replacement Operator to execute an Operator Agreement (such agreement is referred to herein as the “Replacement Operator Agreement”) in a form substantially similar to the applicable Operator Agreement it is replacing and otherwise acceptable to Administrative Agent in its reasonable discretion, which Replacement Operator Agreement shall thereafter be deemed to be an “Operator Agreement” with respect to the applicable Project(s) for all purposes hereunder and under the other Loan Documents.

 

(g)          Concurrently with the execution of the Replacement Operator Agreement, Borrowers cause Replacement Operator to execute and deliver to Administrative Agent a Collateral Assignment of Management Agreement and otherwise acceptable to Administrative Agent in its reasonable discretion.

 

(h)          The Borrowers take commercially reasonable steps to cause the applicable Operator to maintain the Primary Licenses required to operate the affected Project as an assisted living facility, memory care facility, or other healthcare or senior living facility, and the reimbursement agreements (if any) with respect to the affected Project to remain in full force and effect under Requirements of Law.

 

(i)           Borrowers pay all of Administrative Agent’s and each Lender’s reasonable costs and expenses (including, without limitation, reasonable attorneys’ fees) in connection with the matters set forth in this Section 9.4.

 

(j)           Every two weeks during the pendency of the Forbearance Period, Borrowers furnish to Administrative Agent a detailed written statement summarizing the then current status of Borrowers’ attempts to cure the Operational Default and/or remove the defaulting Operator and appoint a Replacement Operator, and otherwise comply with the terms of this Section 9.4.

 

(k)          Borrowers at all times during the Forbearance Period take such additional action and/or execute such additional documents (and/or cause Replacement Operator to take such additional action and/or execute such additional documents, as applicable) as Administrative Agent may reasonably require in connection with the matters set forth in this Section 9.4.

 

 

Anything herein to the contrary notwithstanding, Administrative Agent and Lenders shall have no obligation to forbear from exercising remedies by reason of (i) an Operational Default of any type for which Borrowers elect to install a Replacement Operator more than once during the term of the Loan and (ii) an Operational Default of any type for which Borrowers elect to cure such Operational Default more than five (5) times in the aggregate during the term of the Loan or more than twice in any twelve (12) month period during the term of the Loan.

 

For the avoidance of doubt, Administrative Agent and Lenders shall have no obligation to forbear from submitting any pleadings in any bankruptcy or other proceeding to the extent that a failure to do so could result in any prejudice to Lenders or a rejection or termination of any of the Operator’s Agreements or could otherwise adversely affect the Collateral securing the Loan.

 

ARTICLE 10

 

ADMINISTRATIVE AGENT

 

Section 10.1         Appointment and Duties.

 

(a)           Each Lender hereby appoints CONA (together with any successor Administrative Agent pursuant to Section 10.9) as Administrative Agent hereunder and authorizes Administrative Agent to (i) execute and deliver the Loan Documents and the Environmental Indemnity Agreement and accept delivery thereof on its behalf from any Borrower or any other Borrower Party, (ii) take such action on its behalf and to exercise all rights, powers and remedies and perform the duties as are expressly delegated to Administrative Agent under such Loan Documents and the Environmental Indemnity Agreement and (iii) exercise such powers as are reasonably incidental thereto.

 

(b)           Without limiting the generality of clause (a) above, Administrative Agent shall have the sole and exclusive right and authority (to the exclusion of Lenders), and is hereby authorized, to (i) act as the disbursing and collecting agent for Lenders with respect to all payments and collections arising in connection with the Loan Documents and the Environmental Indemnity Agreement (including in any proceeding described in Section 8.8 or Section 8.9 or any other bankruptcy, insolvency or similar proceeding), and each Person making any payment in connection with any Loan Document and the Environmental Indemnity Agreement to any Secured Party is hereby authorized to make such payment to Administrative Agent, (ii) file and prove claims and file other documents necessary or desirable to allow the claims of the Secured Parties with respect to any Obligation in any proceeding described in Section 8.7 or Section 8.8 or any other bankruptcy, insolvency or similar proceeding (but not to vote, consent or otherwise act on behalf of such Secured Party), (iii) act as collateral agent for each Secured Party for purposes of the perfection of all Liens created by such agreements and all other purposes stated therein, (iv) manage, supervise and otherwise deal with the Collateral, (v) take such other action as is necessary or desirable to maintain the perfection and priority of the Liens created or purported to be created by the Loan Documents, (vi) except as may be otherwise specified in any Loan Document or the Environmental Indemnity Agreement, exercise all remedies given to Administrative Agent and the other Secured Parties with respect to the Collateral, whether under the Loan Documents or the Environmental Indemnity Agreement, applicable law or otherwise, (vii) execute any amendment, consent or waiver under the Loan Documents and the Environmental Indemnity Agreement on behalf of any Lender that has consented in writing to such amendment, consent or waiver to the extent such consent is required hereunder; provided, however, that Administrative Agent hereby appoints, authorizes and directs each Lender to act as collateral sub-agent for Administrative Agent and Lenders for purposes of the perfection of all Liens with respect to the Collateral, including any deposit account maintained by Borrowers or any other Borrower Party with, and cash and Cash Equivalents held by, such Lender, and may further authorize and direct Lenders to take further actions as collateral sub-agents for purposes of enforcing such Liens or otherwise to transfer the Collateral subject thereto to Administrative Agent, and each Lender hereby agrees to take such further actions to the extent, and only to the extent, so authorized and directed and (viii) provide each Lender within ten (10) Business Days following receipt, copies of the reports and financial information received from Borrowers under Article 6 and notices of default delivered by or received by Administrative Agent under this Agreement.

 

 

(c)           Under the Loan Documents and the Environmental Indemnity Agreement, Administrative Agent (i) is acting solely on behalf of Lenders (except to the limited extent provided in Section 2.12(b) with respect to the Register and in Section 11.3), with duties that are entirely administrative in nature, notwithstanding the use of the defined term “Administrative Agent”, the terms “agent”, “administrative agent” and “collateral agent” and similar terms in any Loan Document or the Environmental Indemnity Agreement to refer to Administrative Agent, which terms are used for title purposes only, (ii) is not assuming any obligation under any Loan Document or the Environmental Indemnity Agreement other than as expressly set forth therein or any role as agent, fiduciary or trustee of or for any Lender or any other Secured Party and (iii) shall have no implied functions, responsibilities, duties, obligations or other liabilities under any Loan Document or the Environmental Indemnity Agreement to any Lender, and each Lender hereby waives and agrees not to assert any claim against Administrative Agent based on the roles, duties and legal relationships expressly disclaimed in clauses (i) through (iii) above.

 

Section 10.2         Binding Effect.

 

(a)           Each Lender agrees that as between the Lenders and the Administrative Agent, (i) any action taken by Administrative Agent or the Required Lenders (or, if expressly required hereby, a greater proportion of Lenders) in accordance with the provisions of the Loan Documents or the Environmental Indemnity Agreement, (ii) any action taken by Administrative Agent in reliance upon the instructions of Required Lenders (or, where so required, such greater proportion of Lenders) or without reliance on any Lenders to the extent neither this Agreement nor any of the other Loan Documents explicitly requires the approval of Lenders or Required Lenders, and (iii) the exercise by Administrative Agent or the Required Lenders (or, where so required, such greater proportion of Lenders) of the powers set forth herein or therein, together with such other powers as are reasonably incidental thereto, shall be authorized and binding upon all of the Secured Parties.

 

(b)           Borrowers may rely conclusively on any written consent, approval or waiver of Administrative Agent that it has the authority to act for and bind the Lenders pursuant to this Agreement or the other Loan Documents (excluding, if applicable, any Hedge Agreement provided by a Secured Hedge Provider).

 

 

Section 10.3         Use of Discretion.

 

(a)           Administrative Agent shall not be required to exercise any discretion or take, or to omit to take, any action, including with respect to enforcement or collection of amounts owing hereunder after an Event of Default, except any action it is required to take or omit to take (i) under any Loan Document or the Environmental Indemnity Agreement or (ii) pursuant to instructions from the Required Lenders (or, where expressly required by the terms of this Agreement, a greater proportion of Lenders).

 

(b)           Notwithstanding clause (a) of this Section 10.3, Administrative Agent shall not be required to take, or to omit to take, any action (other than granting consents or approvals, receiving payments or any other matters explicitly set forth in this Agreement or the other Loan Documents and the Environmental Indemnity in each case as being in the sole discretion of Administrative Agent (i) unless, upon demand, Administrative Agent receives an indemnification satisfactory to it from Lenders (or, to the extent applicable and acceptable to Administrative Agent, any other Secured Party) against all Liabilities that, by reason of such action or omission, may be imposed on, incurred by or asserted against Administrative Agent or any Related Person thereof or (ii) that is, in the opinion of Administrative Agent or its counsel, contrary to any Loan Document or the Environmental Indemnity Agreement or applicable Requirement of Law.

 

Section 10.4         Delegation of Rights and Duties. Administrative Agent may perform any and all of its duties and exercise its rights and powers hereunder or under any other Loan Document by or through any one or more sub agents appointed by Administrative Agent. Administrative Agent and any such sub agent may perform any and all of its duties and exercise its rights and powers by or through their respective Related Parties. The exculpatory provisions of this Article shall apply to any such sub agent and to the Related Parties of Administrative Agent and any such sub agent, and shall apply to their respective activities in connection with the syndication of the Loan as well as activities as Administrative Agent. Administrative Agent shall not be responsible for the negligence or misconduct of any sub-agents except to the extent that a court of competent jurisdiction determines in a final and nonappealable judgment that Administrative Agent acted with gross negligence or willful misconduct in the selection of such sub agents.

 

Section 10.5         Reliance and Liability.

 

(a)           Administrative Agent may, without incurring any liability hereunder, (i) treat the payee of any Note as its holder until such Note has been assigned in accordance with Section 11.3, (ii) rely on the Register to the extent set forth in Section 2.12, (iii) consult with any of its Related Persons and, whether or not selected by it, any other advisors, accountants and other experts (including advisors to, and accountants and experts engaged by, any Borrower or any other Borrower Party) and (iv) rely and act upon any document and information (including those transmitted by Electronic Transmission) and any telephone message or conversation, in each case believed by it to be genuine and transmitted, signed or otherwise authenticated by the appropriate parties.

 

 

(b)           None of Administrative Agent and its Related Persons shall be liable to the Lenders for any action taken or omitted to be taken by any of them under or in connection with any Loan Document or the Environmental Indemnity Agreement in its capacity as Administrative Agent (or Related Person of Administrative Agent), and each Lender hereby waives and shall not assert any right, claim or cause of action based thereon, except to the extent of liabilities resulting primarily from the gross negligence or willful misconduct of Administrative Agent or, as the case may be, such Related Person (each as determined in a final, non-appealable judgment by a court of competent jurisdiction) in connection with the duties expressly set forth herein. Without limiting the foregoing, Administrative Agent:

 

(i)          Shall have no duties or responsibilities except those expressly set forth in this Agreement and in the other Loan Documents and the Environmental Indemnity Agreement, and shall not by reason of this Agreement or any other Loan Document or the Environmental Indemnity Agreement, be a trustee for any Lender:

 

(ii)         shall not be responsible or otherwise incur liability for any action or omission taken in reliance upon the instructions of the Required Lenders or for the actions or omissions of any of its Related Persons selected with reasonable care (other than employees, officers and directors of Administrative Agent, when acting on behalf of Administrative Agent);

 

(iii)        shall not be responsible to any Secured Party for the due execution, legality, validity, enforceability, effectiveness, genuineness, sufficiency or value of, or the attachment, perfection or priority of any Lien created or purported to be created under or in connection with, any Loan Document or the Environmental Indemnity Agreement;

 

(iv)        makes no warranty or representation, and shall not be responsible, to any Secured Party for any statement, document, information, representation or warranty made or furnished by or on behalf of any Related Person or any Borrower or any other Borrower Party in connection with any Loan Document, the Environmental Indemnity Agreement or any transaction contemplated therein or any other document or information with respect to any Borrower or any other Borrower Party, whether or not transmitted or (except for documents expressly required under any Loan Document or the Environmental Indemnity Agreement to be transmitted to Lenders) omitted to be transmitted by Administrative Agent, including as to completeness, accuracy, scope or adequacy thereof, or for the scope, nature or results of any due diligence performed by Administrative Agent in connection with the Loan Documents; and

 

(v)         shall not have any duty to ascertain or to inquire as to the performance or observance of any provision of any Loan Document or the Environmental Indemnity Agreement, whether any condition set forth in any Loan Document or the Environmental Indemnity Agreement is satisfied or waived, as to the financial condition of any Borrower or any other Borrower Party or as to the existence or continuation or possible occurrence or continuation of any Potential Default or Event of Default and shall not be deemed to have notice or knowledge of such occurrence or continuation unless it has received a notice from Borrowers, any Lender describing such Potential Default or Event of Default clearly labeled “notice of default” (in which case Administrative Agent shall promptly give notice of such receipt to all Lenders);

 

 

and, for each of the items set forth in clauses (i) through (iv) above, each Lender hereby waives and agrees not to assert any right, claim or cause of action it might have against Administrative Agent based thereon.

 

Section 10.6         Administrative Agent Individually. Administrative Agent and its Affiliates may make loans and other extensions of credit to, acquire stock and stock equivalents of, engage in any kind of business with, any Borrower or any other Borrower Party or Affiliate thereof as though it were not acting as Administrative Agent and may receive separate fees and other payments therefor. To the extent Administrative Agent or any of its Affiliates makes any Loan or otherwise becomes a Lender hereunder, it shall have and may exercise the same rights and powers hereunder and shall be subject to the same obligations and liabilities as any other Lender and the terms “Lender,” and “Required Lender,” and any similar terms shall, except where otherwise expressly provided in any Loan Document or the Environmental Indemnity Agreement, include, without limitation, Administrative Agent or such Affiliate, as the case may be, in its individual capacity as Lender or as one of the Required Lenders, respectively.

 

Section 10.7         Lender Credit Decision. Each Lender acknowledges that it shall, independently and without reliance upon Administrative Agent, any other Lender or any of their Related Persons or upon any document solely or in part because such document was transmitted by Administrative Agent or any of its Related Persons, conduct its own independent investigation of the financial condition and affairs of each Borrower and each other Borrower Party and make and continue to make its own credit decisions in connection with entering into, and taking or not taking any action under, any Loan Document or the Environmental Indemnity Agreement or with respect to any transaction contemplated in any Loan Document or the Environmental Indemnity Agreement, in each case based on such documents and information as it shall deem appropriate. Except for documents expressly required by any Loan Document or the Environmental Indemnity Agreement to be transmitted by Administrative Agent to Lenders, Administrative Agent shall not have any duty or responsibility to provide any Lender with any credit or other information concerning the business, prospects, operations, property, financial and other condition or creditworthiness of any Borrower or any other Borrower Party or any Affiliate of any Borrower or any other Borrower Party that may come into the possession of Administrative Agent or any of its Related Persons.

 

Section 10.8         Expenses. Each Lender agrees to reimburse Administrative Agent and each of its Related Persons (to the extent not reimbursed by any Borrower or any other Borrower Party) promptly upon demand for such Lender’s Pro Rata Share with respect to the Loan of any costs and expenses (including fees, charges and disbursements of financial, legal and other advisors and other taxes paid in the name of, or on behalf of, any Borrower or any other Borrower Party) that may be incurred by Administrative Agent or any of its Related Persons in connection with the preparation, syndication, execution, delivery, administration, modification, consent, waiver or enforcement (whether through negotiations, through any work-out, bankruptcy, restructuring or other legal or other proceeding or otherwise) of, or legal advice in respect of its rights or responsibilities under, any Loan Document and the Environmental Indemnity Agreement.

 

 

Section 10.9         Resignation of Administrative Agent.

 

(a)           Administrative Agent may resign at any time by delivering written notice of such resignation to Lenders and Borrowers, effective on the date set forth in such notice or, if no such date is set forth therein, upon the date such notice shall be effective. If Administrative Agent delivers any such notice, the Required Lenders shall have the right to appoint a successor Administrative Agent, subject to the reasonable approval of Borrowers and provided that (i) no Event of Default shall have occurred and be continuing and (ii) Borrower Representative shall be deemed to have consented to any such appointment unless it shall object thereto by written notice to Administrative Agent within ten (10) Business Days after receipt thereof. If, within thirty (30) days after the retiring Administrative Agent having given written notice of resignation, no successor Administrative Agent has been appointed by the Required Lenders that has accepted such appointment, then the retiring Administrative Agent may, on behalf of Lenders, appoint a successor Administrative Agent from among Lenders (excluding Defaulting Lenders).

 

(b)           Effective immediately upon its resignation, (i) the retiring Administrative Agent shall be discharged from its duties and obligations under the Loan Documents and the Environmental Indemnity Agreement, (ii) Lenders shall assume and perform all of the duties of Administrative Agent until a successor Administrative Agent shall have accepted a valid appointment hereunder, (iii) the retiring Administrative Agent and its Related Persons shall no longer have the benefit of any provision of any Loan Document or the Environmental Indemnity Agreement other than with respect to any actions taken or omitted to be taken while such retiring Administrative Agent was, or because such Administrative Agent had been, validly acting as Administrative Agent under the Loan Documents, and (iv) subject to its rights under Section 9.3, the retiring Administrative Agent shall take such action as may be reasonably necessary to assign to the successor Administrative Agent its rights as Administrative Agent under the Loan Documents and the Environmental Indemnity Agreement. Effective immediately upon its acceptance of a valid appointment as Administrative Agent, a successor Administrative Agent shall succeed to, and become vested with, all the rights, powers, privileges and duties of the retiring Administrative Agent under the Loan Documents and the Environmental Indemnity Agreement.

 

(c)           Administrative Agent may be removed as Administrative Agent upon the request of all Lenders (other than Affiliates of Administrative Agent) upon the determination by a court of competent jurisdiction that Administrative Agent has committed actions constituting gross negligence or willful misconduct under this Agreement. The provisions of subsection (b) above shall apply upon such removal and Lenders shall appoint such successor Administrative Agent in consultation with Borrower Representative.

 

 

Section 10.10      Additional Secured Parties. The benefit of the provisions of the Loan Documents and the Environmental Indemnity Agreement directly relating to the Collateral or any Lien granted thereunder shall extend to and be available to any Secured Party that is not a Lender as long as, by accepting such benefits, such Secured Party agrees, as among Administrative Agent and all other Secured Parties, that such Secured Party is bound by (and, if requested by Administrative Agent, shall confirm such agreement in a writing in form and substance acceptable to Administrative Agent) this Article 10, Section 11.6 (Right of Setoff), Section 11.7 (Sharing of Payments, Etc.) and Section 11.23 (Non-Public Information; Confidentiality) and the decisions and actions of Administrative Agent and the Required Lenders (or, where expressly required by the terms of this Agreement, a greater proportion of Lenders) to the same extent a Lender is bound; provided, however, that, notwithstanding the foregoing, (a) such Secured Party shall be bound by Section 10.13 only to the extent of Liabilities, costs and expenses with respect to or otherwise relating to the Collateral held for the benefit of such Secured Party, in which case the obligations of such Secured Party thereunder shall not be limited by any concept of Pro Rata Share or similar concept, (b) except as set forth specifically herein, each of Administrative Agent and each Lender shall be entitled to act at its sole discretion, without regard to the interest of such Secured Party, regardless of whether any Obligation to such Secured Party thereafter remains outstanding, is deprived of the benefit of the Collateral, becomes unsecured or is otherwise affected or put in jeopardy thereby, and without any duty or liability to such Secured Party or any such Obligation and (c) except as set forth specifically herein, such Secured Party shall not have any right to be notified of, consent to, direct, require or be heard with respect to, any action taken or omitted in respect of the Collateral or under any Loan Document or the Environmental Indemnity Agreement.

 

Section 10.11      Reliance by Administrative Agent. Administrative Agent shall be entitled to rely upon any certification, notice or other communication (including any thereof by telephone, facsimile, telegram or cable) reasonably believed by it to be genuine and correct and to have been signed or sent by or on behalf of the proper Person or Persons, and upon advice and statements of legal counsel, independent accountants and other experts selected by Administrative Agent. As to any matters not expressly provided for by this Agreement or any other Loan Document or the Environmental Indemnity Agreement, Administrative Agent shall in all cases be fully protected in acting, or in refraining from acting, hereunder or thereunder in accordance with instructions given by the Required Lenders, and any action taken or failure to act pursuant thereto shall be binding on all of Lenders.

 

Section 10.12      Rights as a Lender. With respect to CONA’s Loan Commitment, if any, and the advances of the Loan made by it, CONA (and any successor permitted by the terms hereof acting as Administrative Agent) in its capacity as a Lender hereunder shall have the same rights and powers hereunder as any other Lender and may exercise the same as though it were not acting as Administrative Agent, and the term “Lender” or “Lenders” shall, unless the context otherwise indicates, include Administrative Agent in its individual capacity. CONA (and any successor permitted by the terms hereof acting as Administrative Agent) and its Affiliates may (without having to account therefor to any Lender) lend money to, make investments in and generally engage in any kind of lending, trust or other business with Borrowers (and any of their Affiliates) as if it were not acting as Administrative Agent, and CONA and its Affiliates may accept fees and other consideration from Borrowers for services in connection with this Agreement or otherwise without having to account for the same to Lenders.

 

 

Section 10.13      Standard of Care; Indemnification. In performing its duties under the Loan Documents and the Environmental Indemnity Agreement, Administrative Agent will exercise the same degree of care as Administrative Agent normally exercises in connection with similar loans held for its own account, but Administrative Agent shall have no further responsibility to any Lender except as expressly provided herein and except for its own gross negligence or willful misconduct which resulted in actual loss to such Lender, and, except to such extent, Administrative Agent shall have no responsibility to any Lender for the failure by Administrative Agent to comply with any of Administrative Agent’s obligations to Borrowers under the Loan Documents, the Environmental Indemnity Agreement or otherwise. Lenders agree to indemnify Administrative Agent (to the extent not reimbursed under Sections 11.5 or 11.11, but without limiting the obligations of Borrowers under Sections 11.5 or 11.11) ratably in accordance with each Lender’s Pro Rata Share, for any and all liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses or disbursements of any kind and nature whatsoever that may be imposed on, incurred by or asserted against Administrative Agent (including by any Lender) arising out of or by reason of any investigation in or in any way relating to or arising out of this Agreement or any other Loan Document, the Environmental Indemnity Agreement or any other documents contemplated by or referred to herein or therein or the transactions contemplated hereby or thereby (including the costs and expenses that Borrowers are obligated to pay under Section 11.11, but excluding, unless an Event of Default has occurred and is continuing, normal administrative costs and expenses incident to the performance of its agency duties hereunder) or the enforcement of any of the terms hereof or thereof or of any such other documents, provided that no Lender shall be liable for any of the foregoing to the extent they arise from Administrative Agent’s breach of its standard of care set forth in the first sentence of this Section.

 

Section 10.14       Failure to Act. Except for actions expressly required of Administrative Agent hereunder, and under the other Loan Documents and the Environmental Indemnity Agreement, Administrative Agent shall in all cases be fully justified in failing or refusing to act hereunder and thereunder unless it shall receive further assurances to its reasonable satisfaction from Lenders of their indemnification obligations under Section 10.13 against any and all liability and expense that may be incurred by it by reason of taking or continuing to take any such action.

 

Section 10.15       Titles. Notwithstanding any provision to the contrary contained elsewhere in this Agreement or in any other Loan Document, no arrangers, documentation agents, or syndication agent shall have any duties or responsibilities, nor shall any documentation agent or syndication agent have or be deemed to have any fiduciary relationship with any Lender, and no implied covenants, functions, responsibilities, duties, obligations or liabilities shall be read into this Agreement or any other Loan Document or otherwise exist against any arranger, documentation agent or syndication agent. At any time that any Lender serving (or whose Affiliate is serving) as arranger, documentation agent and/or syndication agent shall have transferred to any other Person (other than any Affiliates) all of its interests in the Loan and the Loan Commitment, such Lender (or an Affiliate of such Lender acting as arranger, documentation agent or syndication agent) shall be deemed to have concurrently resigned as such arranger, documentation agent and/or syndication agent.

 

Section 10.16       USA Patriot Act Notice; Compliance. In order for Administrative Agent to comply with the USA Patriot Act of 2001 (Public Law 107-56), prior to any Lender that is organized under the laws of a jurisdiction outside of the United States of America becoming a party hereto, Administrative Agent may request, and such Lender shall provide to Administrative Agent, its name, address, tax identification number and/or such other identification information as shall be necessary for Administrative Agent to comply with federal law.

 

 

Section 10.17     No Reliance on Administrative Agent's Customer Identification Program. Each Lender acknowledges and agrees that neither such Lender, nor any of its Affiliates, participants or assignees, may rely on Administrative Agent to carry out such Lender's, Affiliate's, participant's or assignee's customer identification program, or other obligations required or imposed under or pursuant to the USA PATRIOT Act or the regulations thereunder, including the regulations contained in 31 CFR 1020.220 (as hereafter amended or replaced, the “CIP Regulations”), or any other Anti-Terrorism Law, including any programs involving any of the following items relating to or in connection with Borrowers or any other loan parties, their Affiliates or their agents, the Loan Documents or the transactions hereunder or contemplated hereby: (i) any identity verification procedures, (ii) any recordkeeping, (iii) comparisons with government lists, (iv) customer notices or (v) other procedures required under the CIP Regulations or such other Anti-Terrorism Law.

 

Section 10.18       Defaults.

 

(a)           Administrative Agent shall not be deemed to have knowledge or notice of the occurrence of a Potential Default or an Event of Default unless Administrative Agent has received notice from a Lender or any Borrower Party specifying such Potential Default or Event of Default and stating that such notice is a "Notice of Default." In the event that Administrative Agent receives such a notice of the occurrence of a Potential Default or Event of Default, Administrative Agent shall give prompt notice thereof to the Lenders. Within ten (10) days of delivery of such notice of Potential Default or Event of Default from Administrative Agent to the Lenders (or such shorter period of time as Administrative Agent determines is necessary), Administrative Agent and the Lenders shall consult with each other to determine a proposed course of action. Administrative Agent shall (subject to Section 10.14) take such action with respect to such Potential Default or Event of Default as shall be directed by the Required Lenders, consistent with the terms of this Agreement and the other Loan Documents, provided that, (A) unless and until Administrative Agent shall have received such directions, Administrative Agent may (but shall not be obligated to) take such action, or refrain from taking such action, including decisions (1) to make Protective Advances that Administrative Agent determines are necessary to protect or maintain the Projects and (2) to foreclose on any of the Projects or exercise any other remedy, with respect to such Potential Default or Event of Default as it shall deem advisable in the interest of the Lenders except to the extent that this Agreement expressly requires that such action be taken, or not be taken, only with the consent or upon the authorization of all of the Lenders; provided, however, that no actions approved by the Required Lenders shall violate the Loan Documents or applicable Requirements of Law. Each of the Lenders acknowledges and agrees that no individual Lender may separately enforce or exercise any of the provisions of any of the Loan Documents or Environmental Indemnity Agreement (including the Notes) other than through Administrative Agent. Administrative Agent shall advise the Lenders of all material actions which Administrative Agent takes in accordance with the provisions of this Section 10.18(a) and shall continue to consult with the Lenders with respect to all of such actions. Notwithstanding the foregoing, if the Required Lenders shall at any time direct that a different or additional remedial action be taken from that already undertaken by Administrative Agent, including the commencement of foreclosure proceedings, such different or additional remedial action shall be taken in lieu of or in addition to, the prosecution of such action taken by Administrative Agent; provided that all actions already taken by Administrative Agent pursuant to this Section 10.18(a) shall be valid and binding on each Lender. All cash proceeds (other than cash proceeds subject to the provisions of Section 10.18(i)) received from any enforcement actions, including the cash proceeds of a foreclosure sale of any of the Projects, shall be applied, first, to the payment or reimbursement of Administrative Agent for expenses incurred in accordance with the provisions of Sections 9.2(b), 10.18(c) and Section 10.14 and to the payment of any servicing fees to the extent not paid by Borrowers, second, to the payment or reimbursement of the Lenders for expenses incurred in accordance with the provisions of Sections 9.2(b), 10.18(c) and Section 10.14; third, to the payment or reimbursement of the Lenders for any advances made pursuant to Section 9.2(b) or (g); fourth, pari passu to the Lenders in accordance with their respective Pro Rata Shares and to pay any indebtedness of Borrowers under any Secured Hedge Agreement provided by Administrative Agent or any Affiliate.

 

 

(b)           [Intentionally Omitted].

 

(c)           If, at the direction of the Required Lenders or otherwise as provided in Section 10.18(a), any action(s) is brought to foreclose the Mortgage after an Event of Default, such action shall (to the extent not prohibited under applicable Requirements of Law and the decisions of the court in which such action is brought) be an action brought by Administrative Agent on behalf and for the benefit of the Lenders, collectively, to foreclose all or a portion of the Mortgage and collect on the Notes. Counsel selected by Administrative Agent shall prosecute any such foreclosure on behalf of Administrative Agent and the Lenders and Administrative Agent and the Lenders shall consult and cooperate with each other in the prosecution thereof. If requested by Administrative Agent, each Lender shall join as a party in any such lawsuit or proceeding. All decisions concerning the appointment of a receiver, the conduct of such receivership, the conduct of such foreclosure action, the acceptance of a deed in lieu of foreclosure, the bid on behalf of Administrative Agent and the Lenders at the foreclosure sale of the Projects, the manner of taking and holding title to the Projects (other than as set forth in Section 10.18(d) below), the sale of the Projects after foreclosure pursuant to Section 10.18(e), and the commencement and conduct of any deficiency judgment proceeding shall be made by Administrative Agent subject to this Article 10. The costs and expenses of foreclosure to the extent not paid by Borrowers or Guarantor will be borne by the Lenders in accordance with their respective Pro Rata Shares. If requested by Administrative Agent, each Lender shall join as a party in any such lawsuit or proceeding brought to foreclose the Mortgage and collect on the Notes.

 

(d)           If the Projects (or any part thereof) is acquired by Administrative Agent or its nominee as a result of a foreclosure or the acceptance of a deed or assignment in lieu of foreclosure, or is retained in satisfaction of all or any part of the obligations, the title to the Projects shall be held as required by the Required Lenders and as acceptable to Administrative Agent provided title is held in an entity or structure which limits liability of the Lenders and is a "pass-through" entity or structure for income tax purposes, or, in the absence of such direction of the Required Lenders, at the sole option of Administrative Agent, be held in the name of Administrative Agent, or a nominee or subsidiary of Administrative Agent, as administrative agent, for the ratable benefit of the Lenders, or a limited liability company of which Administrative Agent (or a nominee or subsidiary of Administrative Agent, as administrative agent, for the ratable benefit of the Lenders) is the manager and the Lenders (or their permitted assignees) are the members in proportion to their Pro Rata Shares, which shall be formed pursuant to a form of limited liability company agreement approved by Administrative Agent and the Required Lenders prior to the completion of such foreclosure, which agreement shall include provisions in all material respects similar to this Section 10.18 and Article 10 in relation to the duties, rights and immunities of Administrative Agent (or a nominee or subsidiary of Administrative Agent, in its capacity as the manager thereunder) and rights and obligations of the Lenders. In the event any Lender fails to execute and deliver such agreement in accordance with and after written request therefor from Administrative Agent, each such Lender hereby grants to Administrative Agent a power of attorney to execute and deliver such agreement on its behalf and to take on its behalf any other actions as may reasonably be required to form and qualify such company, which power of attorney is coupled with an interest and irrevocable.

 

 

(e)           Administrative Agent shall prepare for the approval of the Required Lenders a recommended course of action for the Projects (a "Post-Foreclosure Plan"). Subject to its standard of care contained herein, Administrative Agent (or a nominee or subsidiary of Administrative Agent, as administrative agent, for the account of, and ratable benefit of, the Lenders) shall manage, operate, repair, administer, complete, construct, restore or otherwise deal with the Projects acquired, and shall administer all transactions relating thereto, substantially in accordance with the Post-Foreclosure Plan, including, without limitation, employing a management agent, leasing agent and other agents, contractors and employees, including agents for the sale of the Projects, and the collecting of rents and other sums from the Projects and paying the expenses of the Projects. Once approved by the Required Lenders, Administrative Agent shall use commercially reasonable efforts, consistent with its standard of care contained in this Article 10, to operate and maintain the Projects in accordance with the Post-Foreclosure Plan in all material respects (subject to the effect of force majeure events, fire, earthquake, floods, explosion, actions of the elements, other accidents or casualty, declared or undeclared war, riots, mob violence, acts of terrorism, inability to procure or a general shortage of labor, equipment, facilities, energy, materials or supplies in the open market, the effect of orders of Governmental Authorities, laws, rules, regulations or other cause beyond the reasonable control of Administrative Agent) and shall be authorized to make expenditures and pay expenses in accordance with the Post-Foreclosure Plan. It is understood and agreed that Administrative Agent is not warranting that the results contemplated by the Post-Foreclosure Plan shall be realized. If the Required Lenders shall fail to approve of the proposed Post-Foreclosure Plan, however, the following shall apply: (i) if the proposed Post-Foreclosure Plan is the initial Post-Foreclosure Plan, then Administrative Agent, on behalf of the Lenders, may approve an interim plan to govern the operations of the Projects until the Required Lenders approve the first plan; and, (ii) if the proposed Post-Foreclosure Plan is other than the plan referred to in the preceding clause (i), then the Projects shall be operated under the most recent Post-Foreclosure Plan until a new Post-Foreclosure Plan shall be approved by the Required Lenders, subject to adjustments as Administrative Agent shall deem appropriate to take into account emergency or serious maintenance situations at the Projects, any tenant improvement costs and leasing commissions for leases executed after approval of the most recently approved budget and any expenditures for the Projects required by applicable Requirements of Law, which, if not made, may result in the imposition of a fine or penalty or other sanction against the Lenders, Administrative Agent or entity that holds title to the Projects for the benefit of the Lenders. Administrative Agent shall not make any material changes to the approved Post-Foreclosure Plan without the consent of the Required Lenders.

 

 

(f)            Upon demand therefor from time to time, each Lender shall contribute its Pro Rata Share of all costs and expenses incurred by Administrative Agent pursuant to the approved Post-Foreclosure Plan in connection with the construction, operation, management, maintenance, leasing and sale of the Projects. In addition, Administrative Agent shall render or cause to be rendered to each Lender, on a periodic basis (but in any event once per calendar quarter), an income and expense statement for the Projects, and each Lender shall promptly contribute its Pro Rata Share of any operating loss for the Projects, and such other expenses and operating reserves as Administrative Agent shall deem reasonably necessary pursuant to and in accordance with the approved Post-Foreclosure Plan.

 

(g)           To the extent there is net operating income from the Projects, Administrative Agent shall, in accordance with the approved Post-Foreclosure Plan, determine the amount and timing of distributions to the Lenders in accordance with Section 10.18(i).

 

(h)           The Lenders acknowledge and agree that if title to the Projects is obtained by Administrative Agent or its nominee or limited liability company as provided above after an Event of Default and in accordance with the terms of this Agreement and the other Loan Documents, the Projects will not be held as a permanent investment but will be liquidated and the proceeds of such liquidation will be distributed in accordance with the Post-Foreclosure Plan as soon as practicable. Administrative Agent shall undertake to sell the Projects, at such price and upon such terms and conditions as the Required Lenders reasonably shall determine to be most advantageous to the Lenders. Any purchase money mortgage or deed of trust taken in connection with the disposition of the Projects in accordance with the immediately preceding sentence shall name Administrative Agent, as agent for the Lenders, as the beneficiary or mortgagee; provided, however, that purchase money financing shall not be provided in connection with the disposition of the Projects without the prior consent of each Lender. If purchase money financing is so provided, then, Administrative Agent and the Lenders shall enter into an agreement with respect to such purchase money mortgage or deed of trust defining the rights and obligations of Administrative Agent and the rights and obligations of the Lenders in the same Pro Rata Shares as provided hereunder, which agreement shall be in all material respects similar to this Article insofar as the same is appropriate or applicable and shall contain such other terms and conditions as may be satisfactory to each of the Lenders.

 

(i)            All cash proceeds received with respect to the Projects after so acquiring title to or taking possession of the Projects after an Event of Default and in accordance with the terms of this Agreement and the other Loan Documents, including cash proceeds from the rental, operation and management of the Projects and the proceeds of a sale of the Projects, shall be applied, first, to the payment or reimbursement of Administrative Agent for expenses incurred in accordance with the provisions of this Article 10 or for any other sums then due to Administrative Agent hereunder; second, to the payment of operating expenses with respect to the Projects; third, to the establishment of reasonable reserves for the operation of the Projects, including, without limitation, to fund any capital improvement, leasing and other reserves; fourth, to the payment or reimbursement of the Lenders for any advances made pursuant to Section 10.18(c) or (f); fifth, in accordance with clauses first through fourth of Section 10.18(a); and sixth, pari passu to the Lenders in accordance with their respective Pro Rata Shares on account of all sums due and unpaid under the Loan Documents.

 

 

ARTICLE 11

MISCELLANEOUS

 

Section 11.1         Notices.

 

(a)           Notices Generally. Except in the case of notices and other communications expressly permitted to be given by telephone (and except as provided in paragraph (b) below), all notices and other communications provided for herein shall be in writing and shall be delivered by hand or overnight courier service, mailed by certified or registered mail or sent by facsimile as follows:

 

If to Borrowers:	Healthcare Trust Operating Partnership, L.P.
	405 Park Avenue
	New York, New York  10022
	Attention:  Healthcare General Counsel
	Facsimile:  N/A
With a copy to:	Arnold & Porter Kaye Scholer LLP
	250 W 55th Street
	New York, New York  10022
	Attention:  John J. Busillo, Esq.
	Facsimile:  (212) 836-6445
If to Administrative Agent:	Capital One, National Association
	77 W. Wacker Drive, 10TH Floor
	Chicago, Illinois  60601
	Attention:  Jeffrey Muchmore, Credit Executive
	Facsimile:  (855) 332-1699
	Reference:  HTI/Senior Portfolio
With a copy to:	Capital One, National Association
	5804 Trailridge Drive
	Austin, Texas  78731
	Attention:  Diana Pennington, Senior Director,
	Associate General Counsel
	Facsimile:  (855) 438-1132
	Reference:  HTI/Senior Portfolio
With a copy to:	Capital One, National Association
	77 W. Wacker Drive, 10TH Floor
	Chicago, Illinois  60601
	Attention:  Jason LaGrippe, Vice President
	Facsimile:  (312) 739-3870
	Reference:  HTI/Senior Portfolio

 

 

If to a Lender:

To the address in the administrative details provided by such Lender to Administrative Agent

 

Notices sent by hand or overnight courier service, or mailed by certified or registered mail, shall be deemed to have been given when received; notices sent by facsimile shall be deemed to have been given when sent (except that, if not given during normal business hours for the recipient, shall be deemed to have been given at the opening of business on the next business day for the recipient). Notices delivered through electronic communications, to the extent provided in paragraph (b) below, shall be effective as provided in said paragraph (b).

 

(b)           Electronic Communications. Notices and other communications to Lenders hereunder may be delivered or furnished pursuant to an E-System pursuant to procedures approved by Administrative Agent. Administrative Agent or Borrowers may, in its discretion, agree to accept notices and other communications to it hereunder pursuant to an E-System pursuant to procedures approved by it; provided that approval of such procedures may be limited to particular notices or communications.

 

Unless otherwise agreed to by the parties, (i) notices and other communications sent to an e-mail address shall be deemed received upon the sender’s receipt of an acknowledgement from the intended recipient (such as by the “return receipt requested” function, as available, return e-mail or other written acknowledgement), and (ii) if a party has explicitly agreed in writing to accept notice pursuant to E-System, notices or communications posted to an Internet or intranet website shall be deemed received upon the deemed receipt by the intended recipient, at its e-mail address as described in the foregoing clause (i), of notification that such notice or communication is available and identifying the website address therefor; provided that, for both clauses (i) and (ii) above, if such notice, email or other communication is not sent during the normal business hours of the recipient, such notice or communication shall be deemed to have been sent at the opening of business on the next business day for the recipient.

 

(c)           Change of Address, etc. Any party hereto may change its address or facsimile number for notices and other communications hereunder by notice to the other parties hereto.

 

(d)           E-System.

 

(i)          Each Borrower Party agrees that Administrative Agent may, but shall not be obligated to, make the Communications (as defined below) available to Lenders by posting the Communications on the E-System.

 

(ii)         The E-System is provided “as is” and “as available.” The Agent Parties (as defined below) do not warrant the adequacy of the E-System and expressly disclaim liability for errors or omissions in the Communications. No warranty of any kind, express, implied or statutory, including, without limitation, any warranty of merchantability, fitness for a particular purpose, non-infringement of third-party rights or freedom from viruses or other code defects, is made by any Agent Party in connection with the Communications or the E-System. In no event shall Administrative Agent or any of its Related Parties (collectively, the “Agent Parties”) or any Lender have any liability to Borrowers, any Lender or any other Person or entity for damages of any kind, including, without limitation, direct or indirect, special, incidental or consequential damages, losses or expenses (whether in tort, contract or otherwise) arising out of Borrowers or Administrative Agent’s transmission of communications through the E-System. “Communications” means, collectively, any notice, demand, communication, information, document or other material provided by or on behalf of the Borrower Parties pursuant to any Loan Document or the transactions contemplated therein which is distributed to Administrative Agent or any Lender by means of electronic communications pursuant to this Section, including through the E-System.

 

 

Section 11.2         Amendments and Waivers.

 

(a)           No amendment or waiver of any provision of any Loan Document (excluding any Secured Hedge Agreement) or the Environmental Indemnity Agreement and no consent to any departure by any Borrower or any other Borrower Party therefrom shall be effective unless the same shall be in writing and signed (1) in the case of an amendment, consent or waiver to cure any ambiguity, omission, defect or inconsistency or granting a new Lien for the benefit of the Secured Parties or extending an existing Lien over additional property, by Administrative Agent and Borrowers, (2) in the case of any other waiver or consent, by the Required Lenders (or by Administrative Agent with the written consent of the Required Lenders) and (3) in the case of any other amendment, by the Required Lenders (or by Administrative Agent with the consent of the Required Lenders) and Borrowers; provided, however, that no amendment, consent or waiver described in clause (2) or (3) above shall be effective, unless in writing and signed by each Lender (or by Administrative Agent with the consent of Lenders), in addition to any other Person the signature of which is otherwise required pursuant to any Loan Document or the Environmental Indemnity Agreement, and such amendment, consent or waiver does any of the following:

 

(i)          waives any condition precedent to the effectiveness of this Agreement, except any condition referring to any other provision of any Loan Document or the Environmental Indemnity Agreement;

 

(ii)         increases the Loan Commitment of any Lender or subjects any Lender to any additional obligation or otherwise increases the principal amount of the Loan;

 

(iii)        reduces (including through release, forgiveness, assignment or otherwise) (A) the principal amount of, the interest rate on, or any obligation of Borrowers to repay (whether or not on a fixed date), any outstanding amount under the Loan owing to Lenders or (B) any fee or accrued interest payable to any Lender; provided, however, that this clause (iii) does not apply to (x) any change to any provision increasing any interest rate or fee during the continuance of an Event of Default or to any payment of any such increase or (y) any modification to any financial covenant set forth in Article 7 or the Recourse Guaranty Agreement or in any definition set forth therein or principally used therein;

 

 

(iv)        waives or postpones any scheduled maturity date or other scheduled date fixed for the payment, in whole or in part, of principal of or interest on the Loan (including any agreement to forbear that would have the same effect) or fee owing to such Lender or for the reduction of such Lender’s Loan Commitment; provided, however, that this clause (iv) does not apply to any change to mandatory prepayments, including those required under the Agreement, or to the application of any payment, including as set forth in Section 2.7;

 

(v)         releases all or substantially all of the Collateral or any Guarantor from their guaranty of any Obligation of Borrowers (other than releases pursuant to Section 2.18 hereof);

 

(vi)        reduces or increases the proportion of Lenders required for Lenders (or any subset thereof) to take any action hereunder or change the definition of the terms “Required Lenders,” “Pro Rata Share,” or “Pro Rata Outstandings”; or

 

(vii)       amends Section 11.7 (Sharing of Payments, Etc.) or this Section 11.2.

 

(b)           Anything herein to the contrary notwithstanding, (A) any waiver of any payment applied pursuant to Section 2.6 (Application of Payments) to, and any modification of the application of any such payment to the Loan shall require the consent of the Required Lenders, (B) no amendment, waiver or consent shall affect the rights or duties under any Loan Document or the Environmental Indemnity Agreement of, or any payment to, Administrative Agent (or otherwise modify any provision of Article 11 or the application thereof) without the written consent of Administrative Agent, and (C) (1) no Defaulting Lender shall have any right to approve or disapprove any amendment, waiver or consent hereunder, except that (x) the Loan Commitment or Pro Rata Share of such Lender may not be increased or extended without the consent of such Lender, (y) the outstanding balance of such Lender’s Pro Rata Share of the Loan may not be forgiven without the consent of such Lender, and (z) the interest rate on the Loan cannot be reduced unless the Defaulting Lender is treated the same as all other Lenders; (2) each Lender is entitled to vote as such Lender sees fit on any bankruptcy or insolvency reorganization plan that affects the Loan; (3) each Lender acknowledges that the provisions of Section 1126(c) of the Bankruptcy Code supersedes the unanimous consent provisions set forth herein; and (4) the Required Lenders may consent to allow Borrowers to use cash collateral in the context of a bankruptcy or insolvency proceeding.

 

(c)           Each waiver or consent under any Loan Document (including the Recourse Guaranty Agreement) or the Environmental Indemnity Agreement shall be effective only in the specific instance and for the specific purpose for which it was given. No notice to or demand on any Borrower or any other Borrower Party shall entitle such Person to any notice or demand in the same, similar or other circumstances. No failure on the part of any Secured Party to exercise, and no delay in exercising, any right hereunder shall operate as a waiver thereof, nor shall any single or partial exercise of any such right preclude any other or further exercise thereof or the exercise of any other right.

 

 

(d)           This Agreement and the other Loan Documents and the Environmental Indemnity Agreement shall not be executed, entered into, altered, amended, or modified by electronic means. Without limiting the generality of the foregoing, Borrowers, Administrative Agent, and each Lender hereby agree that the transactions contemplated by this Agreement shall not be conducted by electronic means, except as specifically set forth in Section 11.1 regarding notices. Any reference to a Loan Document or the Environmental Indemnity Agreement, whether in this Agreement or in any other Loan Document or the Environmental Indemnity Agreement, shall be deemed to be a reference to such Loan Document or the Environmental Indemnity Agreement as it may hereafter from time to time be amended, modified, supplemented and restated in accordance with the terms hereof.

 

(e)           Unless also consented to in writing by such Secured Hedge Provider or by CONA in the case of a Secured Hedge Agreement provided or arranged by CONA or an Affiliate of CONA, no such amendment, waiver or consent with respect to this Agreement or any other Loan Document or the Environmental Indemnity Agreement shall (i) alter the ratable treatment of Obligations arising under the Secured Hedge Agreement such that such Obligations become junior in right of payment to principal on the Loan or (ii) result in Obligations owing to any Secured Hedge Provider becoming unsecured (other than releases of Liens applicable to all Lenders and otherwise permitted in accordance with the terms hereof), in each case in a manner adverse to such Secured Hedge Provider.

 

(f)            Notwithstanding anything to the contrary contained in this Section 11.2, Agent and Borrowers may amend or modify this Agreement and any other Loan Document to (1) cure any ambiguity, omission, defect or inconsistency therein so long such amendment, modification or supplement is not adverse to the interests of Lenders and (2) grant a new Lien for the benefit of the Secured Parties, extend an existing Lien over additional property for the benefit of the Secured Parties or join additional Persons as Borrower Parties.

 

 

(g)           In the event that any Lender (a “Non-Consenting Lender”) fails to consent to any proposed amendment, modification, termination, waiver or consent with respect to any provision hereof or of any other Loan Document that requires the unanimous approval of all of Lenders or the approval of all of Lenders directly affected thereby, in each case, in accordance with the terms of this Section, Borrowers shall be permitted to (i) so long as no Event of Default then exists, repay in full all outstanding Obligations owed to such Lender and terminate in full all Commitments held by such Non-Consenting Lenders, or (ii) require such Non-Consenting Lender to assign its applicable pro rata share of the Loan, to one or more financial institutions reasonably satisfactory to Administrative Agent, so long as the consent of the Required Lenders shall have been obtained with respect to such amendment, modification, termination, waiver or consent; provided that (A) such assignment does not conflict with any Requirement of Law, (B) the assignee or assignees shall purchase, at par, all Obligations with respect to the Loan owing to the Non-Consenting Lender pursuant to the Loan Documents on or prior to the date of such assignment, (C) the assignee or assignees shall approve the proposed amendment, modification, termination, waiver or consent, (D) the Non-Consenting Lender shall be obligated to make such assignment in accordance with the provisions of Section 11.3(b) hereof (provided that Borrowers shall be obligated to pay the administrative fee referred to in Section 11.3(b)(iv) hereof), and (E) until such time as such assignment shall be consummated, Borrowers shall pay to the Non-Consenting Lender all additional amounts (if any) required pursuant to Sections 2.8, 2.9, 2.10 and 2.17, as the case may be. With respect to both (i) and (ii) above, (A) the Borrower Representative shall provide at least three (3) Business Days’ prior notice to the Non-Consenting Lender of such repayment or assignment, (B) Borrowers shall be liable to the Non-Consenting Lender for all costs payable to it hereunder and under the other Loan Documents (including, without limitation, any LIBOR Breakage), and (C) any such repayment or assignment shall not be deemed to be a waiver of any rights that Borrowers, Administrative Agent or any other Lender shall have against the Non-Consenting Lender. In the event any Non-Consenting Lender fails to execute the agreements required under Section 11.3 hereof in connection with an assignment pursuant to this Section, the Borrower Representative may, upon two (2) Business Days’ prior notice to the Non-Consenting Lender, execute such agreements on behalf of the Non-Consenting Lender, and each such Lender hereby grants to the Borrower Representative an irrevocable power of attorney (which shall be coupled with an interest) for such purpose.

 

(h)           If a Lender does not notify or inform Administrative Agent of whether or not it consents to, or approves of or agrees to any matter of any nature whatsoever with respect to which the unanimous consent, approval or agreement of all Lenders is required under the express provisions of this Agreement, within ten (10) Business Days (or such longer period as may be specified by Administrative Agent) after such unanimous Lender consent, approval or agreement is requested by Administrative Agent, such Lender shall be deemed to have rejected such request for consent, approval or agreement, as the case may be, with respect to the matter in question. For any matter not expressly requiring the unanimous consent of all Lenders, if a Lender does not notify or inform Administrative Agent of whether or not it consents to, or approves of or agrees to any matter of any nature whatsoever with respect to which its consent, approval or agreement is required under the express provisions of this Agreement or with respect to which its consent, approval or agreement is otherwise requested by Administrative Agent, in each case, with the following language prominently displayed at the top and on the cover of any such request in ALL CAPS, boldface, 14 point type or larger: “IMMEDIATE RESPONSE REQUIRED, CONSENT DEEMED GIVEN IF NO RESPONSE WITHIN 10 BUSINESS DAYS” in connection with the Loan or any matter pertaining to the Loan, within ten (10) Business Days (or such longer period as may be specified by Administrative Agent) after such consent, approval or agreement is requested by Administrative Agent, then Administrative Agent shall provide a second request for consent, approval or agreement to such Lender, in each case, with the following language prominently displayed at the top and on the cover of any such request in ALL CAPS, boldface, 14 point type or larger: “IMMEDIATE RESPONSE REQUIRED, CONSENT DEEMED GIVEN IF NO RESPONSE WITHIN 5 BUSINESS DAYS”, and if such Lender does not notify or inform Administrative Agent of whether it consents, approves or agrees within five (5) Business Days of such second request, Lender shall be deemed to have given its consent, approval or agreement, as the case may be, with respect to the matter in question.

 

 

Section 11.3         Successors and Assigns.

 

(a)           The provisions of this Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns permitted hereby, except that none of Borrowers may assign or otherwise transfer any of its rights or obligations hereunder without the prior written consent of each Lender and no Lender may assign or otherwise transfer any of its rights or obligations hereunder except (i) to an Eligible Assignee in accordance with the provisions of clause (b) of this Section 11.3, (ii) by way of participation in accordance with the provisions of clause (e) of this Section 11.3, and (iii) by way of pledge or assignment to secure obligations to a Federal Reserve Bank or any central bank having jurisdiction over such Lender in accordance with the provisions of clause (g) of this Section 11.3 (and any other attempted assignment or transfer by any party hereto shall be null and void). Nothing in this Agreement, expressed or implied, shall be construed to confer upon any Person (other than the parties hereto, their respective successors and assigns permitted hereby, Participants to the extent provided in and permitted by clause (e) of this Section 11.3 and, to the extent expressly contemplated hereby, the Affiliates of each of Administrative Agent and Lenders) any legal or equitable right, remedy or claim under or by reason of this Agreement.

 

(b)           Any Lender may at any time assign to one or more Eligible Assignees all or a portion of its rights and obligations under this Agreement (including all or a portion of its pro rata share of the Loan at the time owing to it); provided that:

 

(i)          (A) in the case of an assignment of the entire remaining amount of the assigning Lender’s applicable portion of the Loan at the time owing to it or in the case of an assignment to a Lender, an Affiliate of a Lender, or an Approved Fund, no minimum amount need be assigned and (B) in any case not described in clause (b)(i)(A) above, a portion of the principal outstanding balance of the pro rata portion of the Loan held by the assigning Lender subject to each assignment (determined as of the date the Assignment Agreement with respect to such assignment is delivered to Administrative Agent or, if “Trade Date” is specified in the Assignment Agreement, as of the Trade Date) provided such portion shall not be less than $1,000,000 (unless Administrative Agent and, so long as no Event of Default is continuing, Borrower Representative otherwise consents, such consent not to be unreasonably withheld or delayed);

 

(ii)         each partial assignment shall be made as an assignment of a proportionate part of all the assigning Lender’s rights and obligations under this Agreement;

 

(iii)        no consent shall be required for any assignment except to the extent required by Section 11.3(b)(i) and, in addition:

 

(A)         so long as no Event of Default is continuing, the consent of the Borrower Representative (such consent not to be unreasonably withheld or delayed) shall be required unless such assignment is to a Lender, an Affiliate of a Lender, or an Approved Fund of any existing Lender; provided that the Borrower Representative shall be deemed to have consented to any such assignment unless it shall object thereto by written notice to Administrative Agent within ten (10) Business Days after having received notice thereof; provided, further, that Borrowers’ consent shall not be required during the primary syndication of the Loan; and

 

(B)         the consent of Administrative Agent (such consent not to be unreasonably withheld or delayed) shall be required for assignments in respect of the Loan to a Person who is not a Lender, an Affiliate of a Lender or an Approved Fund.

 

 

(iv)        the parties to each assignment shall execute and deliver to Administrative Agent an Assignment Agreement, with such assignment becoming effective upon written acknowledgement and acceptance by Administrative Agent (and receipt of all applicable consents required pursuant to the terms hereof), together with an administrative fee of $3,500 (other than for assignments to Lenders or Affiliates (including any Approved Fund) of Lenders), and the Eligible Assignee, if it shall not be a Lender, shall deliver to Administrative Agent an Administrative Questionnaire; and

 

(v)         If required by Requirement of Law, each Lender shall, and shall cause each of its assignees to, provide to Administrative Agent on or prior to the effective date of any assignment an appropriate form supporting such Lender’s or assignee’s position that no withholding by the Borrower Representative or Administrative Agent for income tax payable by such Lender or assignee in respect of amounts received by it hereunder is required.

 

(c)           Subject to acceptance and recording thereof by Administrative Agent pursuant to clause (d) of this Section 11.3, from and after the effective date specified in each Assignment Agreement for purposes of which each Lender agrees to provide Administrative Agent prompt written notice of any assignments of its interests hereunder, the Eligible Assignee thereunder shall be a party to this Agreement and, to the extent of the interest assigned by such Assignment Agreement, have the rights and obligations of a Lender under this Agreement, and the assigning Lender thereunder shall, to the extent of the interest assigned by such Assignment Agreement, be released from its obligations under this Agreement (and, in the case of an Assignment Agreement covering all of the assigning Lender’s rights and obligations under this Agreement, such Lender shall cease to be a party hereto) but shall continue to be entitled to the benefits of Sections 2.8, and 2.9 hereof with respect to facts and circumstances occurring prior to the effective date of such assignment.

 

(d)           Administrative Agent, acting solely for this purpose as an agent of Borrowers, shall maintain at one of its offices specified in Section 11.1, a copy of each Assignment Agreement delivered to it and the Register required pursuant to Section 2.12(b).

 

(e)           Any Lender may at any time, without the consent of, or notice to, Borrowers or Administrative Agent sell participations to any Person (other than a natural person or Borrowers or any of the Borrowers’ Affiliates or Subsidiaries) (each, a “Participant”) in all or a portion of such Lender’s rights and/or obligations under this Agreement (including all or a portion of its Commitments and/or the applicable portion of the Loan owing to it); provided that (i) such Lender’s obligations under this Agreement shall remain unchanged, (ii) such Lender shall remain solely responsible to the other parties hereto for the performance of such obligations and (iii) the Guarantor, Borrowers, Administrative Agent and the other Lenders shall continue to deal solely and directly with such Lender in connection with such Lender’s rights and obligations under this Agreement. Any agreement or instrument pursuant to which a Lender sells such a participation shall provide that such Lender shall retain the sole right to enforce this Agreement and to approve any amendment, modification or waiver of any provision of this Agreement; provided that such agreement or instrument may provide that such Lender will not, without the consent of the Participant, agree to any amendment, modification or waiver with respect to the right to approve or disapprove decreases in the interest rate, increases in the principal amount of the Loan participated in by such Participant, decreases in fees, extensions of any Maturity Date, or other dates of the scheduled principal repayments of the Loan set forth in Section 2.3 hereof and any release of all or substantially all of the Collateral for the Loan (other than Collateral disposed of in accordance with the provisions of this Agreement). Each Lender, acting solely for this purpose as an agent of Borrowers, shall maintain at one of its offices a register for the recordation of the names and addresses of its Participants, and the principal amount and stated interest of each Participant’s interest in the Loan or other obligations under the Loan Documents (the “Participant Register”); provided, that no Lender shall have any obligation to disclose all or any portion of the Participant Register (including the of any Participant or any information relating to a Participant’s interest in any Loan Commitments, the Loan, or its other obligations under any Loan Document) to any Person except to the extent that such disclosure is necessary to establish that such Loan Commitment, the Loan, or other obligation is in registered form under Section 5f.103-1(c) of the United States Treasury Regulations.

 

 

(f)            [Reserved].

 

(g)           Certain Pledges. In addition to the assignments and participations permitted under the foregoing provisions of this Section 11.3 (but without being subject thereto):

 

(i)          Any Lender may (without notice to Borrowers, Administrative Agent or any other Lender and without payment of any fee) assign and pledge all or any portion of its Pro Rata Share of the Loan and its Note to any Federal Reserve Bank as collateral security pursuant to Regulation A and any operating circular issued by such Federal Reserve Bank, and such Pro Rata Share of the Loan and Note shall be fully transferable as provided therein. No such assignment shall release the assigning Lender from its obligations hereunder.

 

(ii)         Any Lender may pledge its Pro Rata Share of the Loan and its Note to any Person that has provided a credit facility or source of liquidity to such Lender. No such pledge shall release the assigning Lender from its obligations hereunder. Any subsequent assignment upon the exercise of pledge remedies shall be subject to the terms of Section 11.3(b).

 

(h)           Subject to the confidentiality provisions set forth herein, Lender may furnish any information concerning Borrowers or any of their Affiliates in the possession of such Lender from time to time to assignees, participants and pledgees, including prospective assignees, participants and to Borrowers or Affiliates. Anything in this Section 11.3 to the contrary notwithstanding, no Lender may assign or participate any interest in any Loan held by it hereunder to Borrowers or any of their Affiliates without the prior written consent of each Lender.

 

 

Section 11.4         Indemnity.

 

(a)           Each Borrower Party agrees to indemnify, hold harmless and defend Administrative Agent, each Lender and each of their respective Related Persons (each such Person being an “Indemnitee”) from and against all Liabilities (including brokerage commissions, fees and other compensation) that may be imposed on, incurred by or asserted against any such Indemnitee in any matter relating to or arising out of, in connection with or as a result of (i) any Loan Document, any Obligation (or the repayment thereof), the use or intended use of the proceeds of any Loan or any securities filing of, or with respect to, any Borrower Party, (ii) [reserved], (iii)  any actual or prospective investigation, litigation or other proceeding, whether or not brought by any such Indemnitee or any of its Related Persons, any holders of securities or creditors (and including reasonable, out-of-pocket, attorneys’ fees in any case), whether or not any such Indemnitee, Related Person, holder or creditor is a party thereto, and whether or not based on any securities or commercial law or regulation or any other Requirement of Law or theory thereof, including common law, equity, contract, tort or otherwise; or (iv) any other act, event or transaction related, contemplated in or attendant to any of the foregoing (collectively, the “Indemnified Matters”); provided, however, that no Borrower Party shall have any liability under this Section 11.4 to any Indemnitee with respect to any Indemnified Matter, and no Indemnitee shall have any liability with respect to any Indemnified Matter other than (to the extent otherwise liable), to the extent such liability has resulted from (x) the gross negligence or willful misconduct of any Indemnitee, as determined by a court of competent jurisdiction in a final non-appealable judgment or order or (y) any dispute solely between or among Indemnitees that has not resulted from an action or omission by any Borrower Party as determined by a court of competent jurisdiction in a final non-appealable judgment or order, except that Administrative Agent shall remain indemnified in such capacity. Furthermore, each Borrower and each other Borrower Party executing this Agreement waives and agrees not to assert against any Indemnitee, any right of contribution with respect to any Liabilities that may be imposed on, incurred by or asserted against any Related Person. For purposes of this Section 11.4, Liabilities shall not include any amount for or on account of Excluded Taxes or Taxes specifically addressed in Section 2.17.

 

(b)           Without limiting the foregoing, “Indemnified Matters” includes all matters subject to indemnification under the Environmental Indemnity Agreement.

 

Section 11.5         Debtor-Creditor Relationship. The relationship between Lenders and Administrative Agent, on the one hand, and Borrowers, on the other hand, is solely that of debtor and creditor. No Secured Party has any fiduciary relationship or duty to any Borrower or any other Borrower Party arising out of or in connection with, and there is no agency, tenancy or joint venture relationship between the Secured Parties and Borrowers and any of the other Borrower Parties by virtue of, any Loan Document, the Environmental Indemnity Agreement or any transaction contemplated therein.

 

Section 11.6         Right of Setoff. Each of Administrative Agent, each Lender, and each Affiliate (including each branch office thereof) of any of them is hereby authorized, without notice or demand (each of which is hereby waived by Borrowers), at any time after an Event of Default and from time to time during the continuance of any Event of Default and to the fullest extent permitted by applicable Requirements of Law (including with respect to Medicare or Medicaid), to set off and apply any and all deposits of Borrowers (whether general or special, time or demand, provisional or final) at any time held and other indebtedness, claims or other obligations at any time owing by Administrative Agent, such Lender, or any of their respective Affiliates to or for the credit or the account of Borrowers against any Obligation of any Borrower or any other Borrower Party now or hereafter existing, whether or not any demand was made under any Loan Document or the Environmental Indemnity Agreement with respect to such Obligation. Each of Administrative Agent and each Lender agrees promptly to notify Borrowers and Administrative Agent after any such setoff and application made by such Lender or its Affiliates; provided, however, that the failure to give such notice shall not affect the validity of such setoff and application. The rights under this Section 11.6 are in addition to any other rights and remedies (including other rights of setoff) that Administrative Agent, Lenders, and their Affiliates and other Secured Parties may have.

 

 

Section 11.7         Sharing of Payments, Etc. If any Lender, directly or through an affiliate or branch office thereof, obtains any payment of any Obligation of any Borrower or any other Borrower Party (whether voluntary, involuntary or through the exercise of any right of setoff or the receipt of any Collateral or “proceeds” (as defined under the applicable UCC) of Collateral) other than pursuant to Section 2.8 (Increased Costs), 2.10 (Interest Rate Protection) and Section 2.11 (Libor Breakage Amount) and such payment exceeds the amount such Lender would have been entitled to receive if all payments had gone to, and been distributed by, Administrative Agent in accordance with the provisions of the Loan Documents, such Lender shall purchase for cash from other Secured Parties such participations in their Obligations as necessary for such Lender to share such excess payment with such Secured Parties to ensure such payment is applied as though it had been received by Administrative Agent and applied in accordance with this Agreement (or, if such application would then be at the discretion of Borrowers, applied to repay the Obligations in accordance herewith); provided, however, that (a) if such payment is rescinded or otherwise recovered from such Lender in whole or in part, such purchase shall be rescinded and the purchase price therefor shall be returned to such Lender without interest and (b) such Lender shall, to the fullest extent permitted by applicable Requirements of Law, be able to exercise all its rights of payment (including the right of setoff) with respect to such participation as fully as if such Lender were the direct creditor of Borrowers in the amount of such participation.

 

Section 11.8         Marshaling; Payments Set Aside. No Secured Party shall be under any obligation to marshal any property in favor of any Borrower or any other Borrower Party or any other party or against or in payment of any Obligation. To the extent that any Secured Party receives a payment from any Borrower or any other Borrower Party, from the proceeds of the Collateral, from the exercise of its rights of setoff, any enforcement action or otherwise, and such payment is subsequently, in whole or in part, invalidated, declared to be fraudulent or preferential, set aside or required to be repaid to a trustee, receiver or any other party, then to the extent of such recovery, the obligation or part thereof originally intended to be satisfied, and all Liens, rights and remedies therefor, shall be revived and continued in full force and effect as if such payment had not occurred.

 

 

Section 11.9         Limitation on Interest. It is the intention of the parties hereto to conform strictly to applicable usury laws. Accordingly, all agreements between Borrowers, Administrative Agent and Lenders with respect to the Loan are hereby expressly limited so that in no event, whether by reason of acceleration of maturity or otherwise, shall the amount paid or agreed to be paid to Administrative Agent and any Lender or charged by Administrative Agent or any Lender for the use, forbearance or detention of the money to be lent hereunder or otherwise, exceed the maximum amount allowed by law. If the Loan would be usurious under applicable law (including the laws of the State of New York and the laws of the United States of America), then, notwithstanding anything to the contrary in the Loan Documents: (a) the aggregate of all consideration which constitutes interest under applicable law that is contracted for, taken, reserved, charged or received under the Loan Documents and the Environmental Indemnity Agreement shall under no circumstances exceed the maximum amount of interest allowed by applicable law, and any excess shall be credited on the Note by the holder thereof (or, if the Note has been paid in full, refunded to Borrowers); and (b) if maturity is accelerated by reason of an election by Administrative Agent permitted by the express terms of the Loan Documents, or in the event of any prepayment, then any consideration which constitutes interest may never include more than the maximum amount allowed by applicable law. In such case, excess interest, if any, provided for in the Loan Documents and the Environmental Indemnity Agreement, or otherwise, to the extent permitted by applicable law, shall be amortized, prorated, allocated and spread from the date of advance until payment in full so that the actual rate of interest is uniform through the term hereof. If such amortization, proration, allocation and spreading is not permitted under applicable law, then such excess interest shall be canceled automatically as of the date of such acceleration or prepayment and, if theretofore paid, shall be credited on the Note (or, if the Note has been paid in full, refunded to Borrowers). The terms and provisions of this Section 11.9 shall control and supersede every other provision of the Loan Documents. The Loan Documents and the Environmental Indemnity Agreement are contracts made under and shall be construed in accordance with and governed by the laws of the State of New York, except that if at any time the laws of the United States of America permit Administrative Agent or Lenders to contract for, take, reserve, charge or receive a higher rate of interest than is allowed by the laws of the State of New York (whether such federal laws directly so provide or refer to the law of any state), then such federal laws shall to such extent govern as to the rate of interest which Administrative Agent or Lenders may contract for, take, reserve, charge or receive under the Loan Documents and the Environmental Indemnity Agreement.

 

Section 11.10      Invalid Provisions. If any provision of any Loan Document or the Environmental Indemnity Agreement is held to be illegal, invalid or unenforceable, such provision shall be fully severable; the Environmental Indemnity Agreement and the Loan Documents shall be construed and enforced as if such illegal, invalid or unenforceable provision had never comprised a part thereof; the remaining provisions thereof shall remain in full effect and shall not be affected by the illegal, invalid, or unenforceable provision or by its severance therefrom; and in lieu of such illegal, invalid or unenforceable provision there shall be added automatically as a part of such Environmental Indemnity Agreement and/or such Loan Document a provision as similar in terms to such illegal, invalid or unenforceable provision as may be possible to be legal, valid and enforceable.

 

 

Section 11.11       Reimbursement of Expenses.

 

(a)          Any action taken by any Borrower or any other Borrower Party under or with respect to any Loan Document, the Environmental Indemnity Agreement, even if required under any Loan Document or the Environmental Indemnity Agreement or at the request of any Secured Party, shall be at the expense of or such Borrower or Borrower Party, and no Secured Party shall be required under any Loan Document or the Environmental Indemnity Agreement to reimburse any Borrower or any other Borrower Party therefor except as expressly provided therein. In addition, Borrowers jointly and severally agree to pay or reimburse upon demand, except as expressly otherwise provided herein (a) Administrative Agent for all reasonable and documented out-of-pocket costs and expenses incurred by it or any of its Related Persons in connection with the investigation, development, preparation, negotiation, syndication, execution, interpretation or administration of, any modification of any term of or termination of, any Loan Document or the Environmental Indemnity Agreement, any commitment or proposal letter therefor, any other document prepared in connection therewith or the consummation and administration of any transaction contemplated therein (including periodic audits in connection therewith and environmental audits and assessments limited to once per year absent an Event of Default), in each case including the reasonable fees, charges and disbursements of legal counsel to Administrative Agent or such Related Persons, fees, costs and expenses incurred in connection with Intralinks®, Syndtrak®, or any other E-System and allocated to the Loan by Administrative Agent in its sole discretion and fees, charges and disbursements of the auditors, appraisers, printers and other of their Related Persons retained by or on behalf of any of them or any of their Related Persons, (b) Administrative Agent and each Lender for all reasonable costs and expenses incurred by them or any of their Related Persons in connection with internal audit reviews, field examinations, financial investigation, and Collateral examinations, including, without limitation, any tax service company, (c) each of Administrative Agent, its Related Persons, and each Lender for all costs and expenses incurred in connection with (i) any refinancing or restructuring of the credit arrangements provided hereunder in the nature of a “work-out”, (ii) the enforcement or preservation of any right or remedy with respect to any Obligation, the Collateral or under any Loan Document or the Environmental Indemnity Agreement, or any other related right or remedy or (iii) the commencement, defense, conduct of, intervention in, or the taking of any other action with respect to, any proceeding (including any bankruptcy or insolvency proceeding) related to any Borrower Party, any Loan Document, the Environmental Indemnity Agreement, any Obligation or related transaction (or the response to and preparation for any subpoena or request for document production relating thereto), including reasonable fees and disbursements of outside counsel, (d) costs incurred in connection with settlement of condemnation and casualty awards, premiums for title insurance and endorsements thereto, and (e) fees and costs for Uniform Commercial Code and litigation searches and background checks customarily undertaken by Administrative Agent or any Lenders.

 

(b)          Borrowers shall also pay to Administrative Agent on each Payment Date during the term of the Loan, in addition to all other amounts due under the Loan Documents, the sum of One Hundred Fifty and No/100 Dollars ($150.00) per Project, which Administrative Agent shall apply against the cost and expenses incurred in connection with the annual on-site audit and inspection of the Projects.

 

Section 11.12       Approvals; Third Parties; Conditions. All approval rights retained or exercised by Administrative Agent or Lenders with respect to Leases, contracts, plans, studies and other matters are solely to facilitate Administrative Agent’s and Lenders’ credit underwriting, and shall not be deemed or construed as a determination that Administrative Agent or Lenders have passed on the adequacy thereof for any other purpose and may not be relied upon by Borrowers or any other Person. This Agreement is for the sole and exclusive use of Administrative Agent (and its successors and permitted assigns), Lenders (and their successors and permitted assigns and participants), and Borrowers and may not be enforced, nor relied upon, by any Person other than Administrative Agent (and its successors and permitted assigns), Lenders (and their successors and permitted assigns and participants), and Borrowers. All conditions of the obligations of Administrative Agent and Lenders hereunder, including the obligation to make advances, are imposed solely and exclusively for the benefit of Administrative Agent and Lenders, their successors and assigns, and no other Person shall have standing to require satisfaction of such conditions or be entitled to assume that any Lender will refuse to make advances in the absence of strict compliance with any or all of such conditions, and no other Person shall, under any circumstances, be deemed to be a beneficiary of such conditions, any and all of which may be freely waived in whole or in part by any Lender at any time in such Lender’s sole discretion.

 

 

Section 11.13      Administrative Agent and Lenders Not in Control; No Partnership. None of the covenants or other provisions contained in this Agreement shall, or shall be deemed to, give Administrative Agent or Lenders the right or power to exercise control over the affairs or management of Borrowers, the power of Administrative Agent and Lenders being limited to the rights to exercise the remedies referred to in the Environmental Indemnity Agreement or the Loan Documents. No covenant or provision of the Environmental Indemnity Agreement or the Loan Documents is intended, nor shall it be deemed or construed, to create a partnership, joint venture, agency or common interest in profits or income among Administrative Agent and Lenders or any of them, on the one hand, and Borrowers, on the other hand, or to create an equity interest in the Projects in Administrative Agent or any Lender. None of Administrative Agent nor any Lender undertakes or assumes any responsibility or duty to Borrowers or to any other Person with respect to the Projects or the Loan, except as expressly provided in the Environmental Indemnity Agreement and the Loan Documents; and notwithstanding any other provision of the Environmental Indemnity Agreement or the Loan Documents: (a) none of Administrative Agent or any Lender are, and shall not be construed as, a partner, joint venturer, alter ego, manager, controlling person or other business associate or participant of any kind of Borrowers or Borrowers’ stockholders, members, or partners and Administrative Agent and Lenders do not intend to ever assume such status; (b) Administrative Agent and Lenders shall in no event be liable for any Debts, expenses or losses incurred or sustained by Borrowers; and (c) Administrative Agent and Lenders shall not be deemed responsible for or a participant in any acts, omissions or decisions of Borrowers or any Borrower’s stockholders, members, or partners. Administrative Agent and Lenders and Borrowers disclaim any intention to create any partnership, joint venture, agency or common interest in profits or income among Administrative Agent and Lenders or any of them, on the one hand, and Borrowers, on the other hand, or to create an equity interest in the Projects in Administrative Agent or Lenders, or any sharing of liabilities, losses, costs or expenses.

 

Section 11.14      Contest of Certain Claims. Borrowers may contest the validity of Taxes or any mechanic’s or materialman’s or other lien asserted against the Project so long as (a) Borrowers notify Administrative Agent that they intend to contest such Taxes or liens, as applicable, (b) Borrowers provide Administrative Agent with an indemnity, bond or other security reasonably satisfactory to Administrative Agent assuring the discharge of Borrowers’ obligations for such Taxes or liens, as applicable, including interest and penalties, (c) Borrowers are diligently contesting the same by appropriate legal proceedings in good faith and at their own expense and conclude such contest prior to the tenth (10th) day preceding the earlier to occur of the Maturity Date or the date on which any Project are scheduled to be sold for non-payment, and (d) Borrowers promptly upon final judicial determination thereof pay the amount of any such Taxes or liens, as applicable, together with all costs, interest and penalties which may be payable in connection therewith. Notwithstanding the foregoing, Borrowers shall immediately upon request of Administrative Agent pay any such Taxes or liens, as applicable, notwithstanding such contest if, in the opinion of Administrative Agent, any Project or any part thereof or interest therein may be in danger of being sold, forfeited, foreclosed, terminated, canceled or lost. Administrative Agent may pay over any cash deposit or part thereof to the claimant entitled thereto at any time when, in the reasonable judgment of Administrative Agent, the entitlement of such claimant is established.

 

 

Section 11.15       Time of the Essence. Time is of the essence with respect to this Agreement.

 

Section 11.16      Acknowledgement and Consent to Bail-In of EEA Financial Institutions. Notwithstanding anything to the contrary in any Loan Document or in any other agreement, arrangement or understanding among any such parties, each party hereto acknowledges that any liability of any EEA Financial Institution arising under any Loan Document, to the extent such liability is unsecured, may be subject to the write-down and conversion powers of an EEA Resolution Authority and agrees and consents to, and acknowledges and agrees to be bound by:

 

(a)           the application of any Write-Down and Conversion Powers by an EEA Resolution Authority to any such liabilities arising hereunder which may be payable to it by any party hereto that is an EEA Financial Institution; and

 

(b)           the effects of any Bail-in Action on any such liability, including, if applicable:

 

(i)          a reduction in full or in part or cancellation of any such liability;

 

(ii)         a conversion of all, or a portion of, such liability into shares or other instruments of ownership in such EEA Financial Institution, its parent undertaking, or a bridge institution that may be issued to it or otherwise conferred on it, and that such shares or other instruments of ownership will be accepted by it in lieu of any rights with respect to any such liability under this Agreement or any other Loan Document; or

 

(iii)        the variation of the terms of such liability in connection with the exercise of the write-down and conversion powers of any EEA Resolution Authority.

 

Section 11.17       Renewal, Extension or Rearrangement. All provisions of the Environmental Indemnity Agreement and the Loan Documents shall apply with equal effect to each and all promissory notes and amendments thereof hereinafter executed which in whole or in part represent a renewal, extension, increase or rearrangement of the Loan.

 

Section 11.18       Waivers.

 

(a)           No course of dealing on the part of Administrative Agent or Lenders or their respective officers, employees, consultants or agents, nor any failure or delay by Administrative Agent or any Lender with respect to exercising any right, power or privilege of Administrative Agent or Lenders under the Environmental Indemnity Agreement and any of the Loan Documents, shall operate as a waiver thereof.

 

 

(b)           Each Borrower hereby waives any right under the UCC or any other applicable law to receive notice and/or copies of any filed or recorded financing statements, amendments thereto, continuations thereof or termination statements and releases and excuses Administrative Agent and each Lender from any obligation under the UCC or any other applicable law to provide notice or a copy of any such filed or recorded documents.

 

Section 11.19       Cumulative Rights; Joint and Several Liability. Rights and remedies of Administrative Agent (on behalf of Lenders) under the Environmental Indemnity Agreement and the Loan Documents shall be cumulative, and the exercise or partial exercise of any such right or remedy shall not preclude the exercise of any other right or remedy. If more than one person or entity has executed this Agreement as a “Borrower”, the obligations of all such persons or entities hereunder shall be joint and several.

 

Section 11.20       Joint and Several Liability of all Borrowers.

 

(a)           Each of Borrowers is accepting joint and several liability hereunder in consideration of the financial accommodation to be provided by Lenders under this Agreement, for the mutual benefit, directly and indirectly, of each Borrower and in consideration of the undertakings of each Borrower to accept joint and several liability for the obligations of each of them.

 

(b)           Each Borrower hereby agrees such Borrower is, and each such Borrower’s successors and assigns are, jointly and severally liable for, and hereby absolutely and unconditionally guarantees to Administrative Agent and Lenders and their respective successors and assigns, the full and prompt payment (whether at stated maturity, by acceleration or otherwise) and performance of, all of the Indebtedness and all other Obligations of Borrowers under any Loan or other Borrower Party under a Secured Hedge Agreement, it being the intention of the parties hereto that all the Obligations shall be the joint and several obligations of each Borrower without preferences or distinction among them. Each Borrower agrees that its guaranty obligation hereunder is a continuing guaranty of payment and performance and not of collection, that its obligations under this Section 11.20 shall not be discharged until payment and performance, in full, of the Obligations has occurred, and that its obligations under this Section 11.20 shall be absolute and unconditional.

 

(c)           If and to the extent that any Borrower shall fail to make any payment with respect to any of the Obligations hereunder as and when due or to perform any of such Obligations in accordance with the terms thereof, then in each such event, the other Borrowers will make such payment with respect to, or perform, such Obligation.

 

(d)           Subject to Section 12.1 hereof, the guaranty obligations of each Borrower under the provisions of this Section 11.20 constitute full recourse obligations of such Borrower, enforceable against it to the full extent of its properties and assets, irrespective of the validity, regularity or enforceability of this Agreement or any other circumstances whatsoever (except the defense of payment), including the following:

 

(i)          the genuineness, validity, regularity, enforceability or any future amendment of, or change in, this Agreement, any other Loan Document, the Environmental Indemnity Agreement, or any other agreement, document or instrument to which any other Borrower is or may become a party;

 

 

(ii)         the absence of any action to enforce this Agreement (including this Section 11.19) or any other Loan Document or the waiver or consent by Administrative Agent and Lenders with respect to any of the provisions thereof;

 

(iii)        the existence, value or condition of, or failure to perfect any lien or any security for the Obligations or any action, or the absence of any action, by Administrative Agent and Lenders in respect thereof (including the release of any such security);

 

(iv)        the insolvency of any other Borrower;

 

(v)         the institution of any proceeding under the Federal Bankruptcy Code, or any similar proceeding, by or against a Borrower or Administrative Agent’s election in any such proceeding of the application of Section 1111(b)(2) of the Federal Bankruptcy Code;

 

(vi)        any borrowing or grant of a security interest by any Borrower as debtor-in-possession, under Section 364 of the Federal Bankruptcy Code;

 

(vii)       the disallowance, under Section 502 of the Federal Bankruptcy Code, of all or any portion of Administrative Agent’s claim(s) for repayment of any of the Obligations; or

 

(viii)      any other action or circumstances that might otherwise constitute a legal or equitable discharge or defense of a surety or guarantor other than the payment and performance, in full, of the Obligations.

 

Each Borrower shall be regarded, and shall be in the same position, as principal debtor with respect to the Obligations guaranteed hereunder.

 

 

(e)           Except as otherwise expressly provided herein, each Borrower hereby waives notice of acceptance of its joint and several liability, notice of occurrence of any Potential Default or Event of Default (except to the extent notice is expressly required to be given pursuant to the terms of this Agreement), or of any demand for any payment under this Agreement (except to the extent demand is expressly required to be given pursuant to the terms of this Agreement), notice of any action at any time taken or omitted by Administrative Agent or any Lender under or in respect of any of the Obligations hereunder, any requirement of diligence and, generally, all demands, notices and other formalities of every kind in connection with this Agreement. Each Borrower hereby assents to, and waives notice of, any extension or postponement of the time for the payment of any of the Obligations hereunder, the acceptance of any partial payment thereon, any waiver, consent or other action or acquiescence by Lenders at any time or times in respect of any default by any Borrower in the performance or satisfaction of any term, covenant, condition or provision of this Agreement, any and all other indulgences whatsoever by Administrative Agent or Lenders in respect of any of the Obligations hereunder, and the taking, addition, substitution or release, in whole or in part, at any time or times, of any security for any of such Obligations or the addition, substitution or release, in whole or in part, of any Borrower. Without limiting the generality of the foregoing, each Borrower assents to any other action or delay in acting or any failure to act on the part of Administrative Agent or any Lender, including any failure strictly or diligently to assert any right or to pursue any remedy or to comply fully with applicable laws or regulations thereunder which might, but for the provisions of this Section 11.20, afford grounds for terminating, discharging or relieving such Borrower, in whole or in part, from any of its obligations under this Section 11.20, it being the intention of each Borrower that, so long as any of the Obligations hereunder remain unsatisfied, the obligations of such Borrower under this Section 11.20 shall not be discharged except by performance and then only to the extent of such performance. The obligations of each Borrower under this Section 11.20 shall not be diminished or rendered unenforceable by any winding up, reorganization, arrangement, liquidation, reconstruction or similar proceeding with respect to any Borrower, Administrative Agent or any Lender. The joint and several liability of Borrowers hereunder shall continue in full force and effect notwithstanding any absorption, merger, amalgamation or any other change whatsoever in the name, membership, constitution or place of formation of any Borrower, Administrative Agent or any Lender.

 

(f)            Notwithstanding anything to the contrary in this Agreement or in any other Loan Document or the Environmental Indemnity Agreement, and except as set forth in Section 11.20(j), each Borrower hereby expressly and irrevocably subordinates to payment of the Obligations any and all rights at law or in equity to subrogation, reimbursement, exoneration, contribution, indemnification or set off and any and all defenses available to a surety, guarantor or accommodation co-obligor until the Obligations are indefeasibly paid in full in cash. Each Borrower acknowledges and agrees that this subordination is intended to benefit Administrative Agent and Lenders and shall not limit or otherwise affect such Borrower’s liability hereunder or the enforceability of this Section 11.20, and that Administrative Agent, Lenders and their respective successors and assigns are intended third party beneficiaries of the waivers and agreements set forth in this Section 11.20. For the avoidance of doubt, Borrowers hereby agree to the foregoing subordination.

 

(g)           If Administrative Agent or any Lender may, under applicable Law, proceed to realize its benefits under any of the Loan Documents or the Environmental Indemnity Agreement giving Administrative Agent or such Lender a lien upon any Collateral, whether owned by any Borrower or by any other Person, either by judicial foreclosure or by non-judicial sale or enforcement, Administrative Agent or any Lender may, at its sole option, determine which of its remedies or rights it may pursue without affecting any of its rights and remedies under this Section 11.20. If, in the exercise of any of its rights and remedies, Administrative Agent or any Lender shall forfeit any of its rights or remedies, including its right to enter a deficiency judgment against any Borrower or any other Person, whether because of any applicable Laws pertaining to “election of remedies” or the like, each Borrower hereby consents to such action by Administrative Agent or such Lender and waives any claim based upon such action, even if such action by Administrative Agent or such Lender shall result in a full or partial loss of any rights of subrogation that each Borrower might otherwise have had but for such action by Administrative Agent or such Lender. Any election of remedies that results in the denial or impairment of the right of Administrative Agent or any Lender to seek a deficiency judgment against any Borrower shall not impair any other Borrower’s obligation to pay the full amount of the Obligations. In the event Administrative Agent or any Lender shall bid at any foreclosure or trustee’s sale or at any private sale permitted by law or the Loan Documents, Administrative Agent or such Lender may bid all or less than the amount of the Obligations and the amount of such bid need not be paid by Administrative Agent or such Lender but shall be credited against the Obligations. The amount of the successful bid at any such sale, whether Administrative Agent, Lender or any other party is the successful bidder, shall be conclusively deemed to be the fair market value of the Collateral and the difference between such bid amount and the remaining balance of the Obligations shall be conclusively deemed to be the amount of the Obligations guaranteed under this Section 11.20, notwithstanding that any present or future law or court decision or ruling may have the effect of reducing the amount of any deficiency claim to which Administrative Agent or any Lenders might otherwise be entitled but for such bidding at any such sale.

 

 

(h)           The provisions of this Section 11.20 are made for the benefit of Administrative Agent, Lenders and their respective successors and assigns, and may be enforced by any such Person from time to time against any of the applicable Borrowers as often as occasion therefor may arise and without requirement on the part of Administrative Agent or any Lender first to marshal any of its claims or to exercise any of its rights against any of the other Borrowers or to exhaust any remedies available to it against any of the other Borrowers or to resort to any other source or means of obtaining payment of any of the Obligations or to elect any other remedy. The provisions of this Section 11.20 shall remain in effect until all the Obligations hereunder shall have been paid in full or otherwise fully satisfied. If at any time, any payment, or any part thereof, made in respect of any of the Obligations, is rescinded or must otherwise be restored or returned by Lenders upon the insolvency, bankruptcy or reorganization of any of Borrowers, or otherwise, the provisions of this Section 11.20 will forthwith be reinstated and in effect as though such payment had not been made.

 

(i)            Each Borrower’s liability under this Section 11.20 shall be limited to an amount not to exceed as of any date of determination the greater of the following:

 

(i)          the Allocated Loan Amount for the Project owned by such Borrower; and

 

(ii)         the amount that could be claimed by Administrative Agent and any Lender from such Borrower under this Section 11.20 without rendering such claim voidable or avoidable under Section 548 of Chapter 11 of the Bankruptcy Code or under any applicable state Uniform Fraudulent Transfer Act, Uniform Fraudulent Conveyance Act or similar statute or common law after taking into account, among other things, such Borrower’s right of contribution and indemnification from each other Borrower under Section 11.20(j) below.

 

(j)            Contribution with Respect to Guaranty Obligations:

 

(i)          To the extent that any Borrower (the “Overpaying Borrower”) incurs (i) any payment in excess of its Allocated Loan Amount, or (ii) a loss of its Collateral due to the foreclosure (or other realization by Lenders) of, or the delivery of deeds in lieu of foreclosure relating to it Collateral, and the value of such Collateral exceeded its Allocated Loan Amount (the “Overpayment Amount”), then such Overpaying Borrower shall be entitled, after indefeasible payment in full and the satisfaction of all Obligations to Lenders under this Agreement, to contribution from each of the benefited Borrowers, on a pro rata basis, for the amounts so paid, advanced or benefited, in an amount equal to the difference between the Overpayment Amount and such benefited Borrower’s then current Allocated Loan Amount. Any such contribution payments shall be made within ten (10) Business Days after demand therefor.

 

 

(ii)         This Section 11.20(j) is intended only to define the relative rights of Borrowers and nothing set forth in this Section 11.20(j) is intended to or shall impair the obligations of Borrowers, jointly and severally, to pay any amounts as and when the same shall become due and payable in accordance with the terms of this Agreement, including Section 11.20(a) above. Nothing contained in this Section 11.20(j) shall limit the liability of any Borrower to pay all or any part of the Loan made directly or indirectly to that Borrower and accrued interest, fees and expenses with respect thereto for which such Borrower shall be primarily liable.

 

(iii)        The parties hereto acknowledge that the rights of contribution and indemnification hereunder shall constitute assets of Borrower to which such contribution and indemnification is owing.

 

(iv)        The rights of the indemnifying Borrowers against other Borrowers under this Section 11.20(j) shall be exercisable only upon the full and indefeasible payment of the Obligations.

 

(k)           The liability of Borrowers under this Section 11.20 is in addition to and shall be cumulative with all liabilities of each Borrower to Administrative Agent and Lenders under this Agreement, the other Loan Documents and the Environmental Indemnity Agreement to which such Borrower is a party or in respect of any Obligations or obligation of the other Borrowers, without any limitation as to amount, unless the instrument or agreement evidencing or creating such other liability specifically provides to the contrary.

 

(l)            Each Qualified ECP Guarantor hereby jointly and severally, absolutely, unconditionally and irrevocably undertakes to provide such funds or other support as may be needed from time to time by each other Borrower to honor all of its obligations in respect of Swap Obligations under any Secured Hedge Agreement (provided, however, that each Qualified ECP Guarantor shall only be liable under this Section 11.20(l) for the maximum amount of such liability than can be hereby incurred without rendering its obligations under this Section 11.20(l), voidable under applicable Requirements of Law relating to fraudulent conveyance or fraudulent transfer, and not for any greater amount). The obligations of each Qualified ECP Guarantor under this Section 11.20(l) shall remain in full force and effect until the guarantees in respect of Swap Obligations under each Secured Hedge Agreement have been discharged, or otherwise released or terminated in accordance with the terms of this Agreement. Each Qualified ECP Guarantor intends that this Section 11.20(l) constitute, and this Section 11.20(l) shall be deemed to constitute, a “keepwell, support, or other agreement” for the benefit of each other Borrower for all purposes of Section 1a(18)(A)(v)(II) of the Commodity Exchange Act.

 

 

Section 11.21      Singular and Plural. Words used in this Agreement, the other Loan Documents and the Environmental Indemnity Agreement, in the singular, where the context so permits, shall be deemed to include the plural and vice versa. The definitions of words in the singular in this Agreement, the other Loan Documents, and the Environmental Indemnity Agreement shall apply to such words when used in the plural where the context so permits and vice versa.

 

Section 11.22       Exhibits and Schedules. The exhibits and schedules attached to this Agreement are incorporated herein and shall be considered a part of this Agreement for the purposes stated herein.

 

Section 11.23      Titles of Articles, Sections and Subsections. All titles or headings to articles, sections, subsections or other divisions of this Agreement, the other Loan Documents, and the Environmental Indemnity Agreement or the exhibits hereto and thereto are only for the convenience of the parties and shall not be construed to have any effect or meaning with respect to the other content of such articles, sections, subsections or other divisions, such other content being controlling as to the agreement between the parties hereto.

 

Section 11.24       Non-Public Information; Confidentiality.

 

(a)           Non-Public Information. Each of Administrative Agent and each Lender acknowledges and agrees that it may receive material non-public information (“MNPI”) hereunder concerning the Borrower Parties and their Affiliates and agrees to use such information in compliance with all relevant policies, procedures and applicable Requirements of Laws (including United States federal and state security laws and regulations).

 

(b)           Confidential Information. Each of Administrative Agent and each Lender severally agrees to maintain the confidentiality of information obtained by it pursuant to any Loan Document, except that such information may be disclosed (i) with the Borrower Representative’s consent, (ii) to Related Persons of such Lender, or Administrative Agent, as the case may be, that are advised of the confidential nature of such information and are instructed to keep such information confidential in accordance with the terms hereof, (iii) to the extent such information presently is or hereafter becomes (A) publicly available other than as a result of a breach of this Section 11.24 or (B) available to such Lender, or Administrative Agent or any of their Related Persons, as the case may be, from a source (other than any Borrower Party) not known by them to be subject to disclosure restrictions, (iv) to the extent disclosure is required by applicable Requirements of Law or other legal process or requested or demanded by any Governmental Authority, provided that the applicable Borrower Party shall be given prior written notice thereof to the extent permitted by applicable Requirements of Law or no Governmental Authority has requested otherwise, (v) to the extent necessary or customary for inclusion in league table measurements, (vi) (A) to the National Association of Insurance Commissioners or any similar organization, any examiner or any nationally recognized rating agency or (B) otherwise to the extent consisting of general portfolio information that does not identify Borrower Parties, (vii) to current or prospective assignees, financing sources to any Lender, SPVs (including the investors or prospective investors therein) or participants, direct or contractual counterparties to any Hedge Agreements and to their respective Related Persons, in each case to the extent such assignees, investors, participants, counterparties or Related Persons agree to be bound by provisions substantially similar to the provisions of this Section 11.24 (and such Person may disclose information to their respective Related Persons in accordance with clause (ii) above), (viii) to any other party hereto, and (ix) in connection with the exercise or enforcement of any right or remedy under any Loan Document, in connection with any litigation or other proceeding to which such Lender, or Administrative Agent or any of their Related Persons is a party or bound, or to the extent necessary to respond to public statements or disclosures by Borrower Parties or their Related Persons referring to a Lender, or Administrative Agent or any of their Related Persons. In the event of any conflict between the terms of this Section 11.24 and those of any other contractual obligation entered into with any Borrower Party (whether or not a Loan Document), the terms of this Section 11.24 shall govern. This Section 11.24(b) shall survive the termination of this Agreement for a period of 12 months.

 

 

(c)           Tombstones. Each Borrower Party consents to the publication by Administrative Agent or any lead arranger named on the cover hereto of advertising material relating to the financing transactions contemplated by this Agreement using any Borrower Party’s name, product photographs, logo or trademark. Administrative Agent or such lead arranger shall provide a draft of any additional advertising material to Borrower Representative for review and comment prior to the publication thereof.

 

(d)           Press Release and Related Matters. No Borrower Party shall, and no Borrower Party shall permit any of its Affiliates to, issue any press release or other public disclosure (other than any document filed with any Governmental Authority relating to a public offering of securities of any Borrower Party) using the name, logo or otherwise referring to Administrative Agent or of any of its Affiliates, the Loan Documents or any transaction contemplated therein to which Administrative Agent is party without the prior consent of Administrative Agent (such consent not to be unreasonably withheld or delayed) except to the extent required to do so under applicable Requirements of Law and then, only after delivering a copy thereof to Administrative Agent. Neither Administrative Agent nor any Lender shall issue any press release or other public disclosure with respect to the Loan Documents or any transaction contemplated therein using the name, logo or otherwise referring to any Borrower Party or any terms and conditions with respect to the Loan Documents without the prior consent of Borrower Representative except to the extent required to do so under applicable Requirements of Law.

 

(e)           Distribution of Materials to Lenders. The Borrower Parties acknowledge and agree that the Loan Documents and all reports, notices, communications and other information or materials provided or delivered by, or on behalf of, the Borrower Parties hereunder (collectively, the “Borrower Materials”) may be disseminated by, or on behalf of, Administrative Agent, and made available, to Lenders by posting such Borrower Materials on an E-System. The Borrower Parties authorize Administrative Agent to download copies of their logos from its website and post copies thereof on an E-System reasonably selected by Administrative Agent.

 

 

Section 11.25      Survival. All indemnities hereunder under the indemnification provisions of the other Loan Documents and under the Environmental Indemnity Agreement, shall survive the repayment in full of the Loan and the release of the liens evidencing or securing the Loan, and shall survive the transfer (by sale, foreclosure, conveyance in lieu of foreclosure or otherwise) of any or all right, title and interest in and to the Projects to any party, whether or not an Affiliate of Borrower in accordance with the provisions of any such Loan Document.

 

Section 11.26      Waiver of Jury Trial. TO THE MAXIMUM EXTENT PERMITTED BY LAW, BORROWERS, ADMINISTRATIVE AGENT, AND EACH LENDER HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVE THE RIGHT TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION BASED HEREON, ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS AGREEMENT, ANY OTHER LOAN DOCUMENT, OR THE ENVIRONMENTAL INDEMNITY AGREEMENT, OR ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENT (WHETHER VERBAL OR WRITTEN) OR ACTION OF EITHER PARTY OR ANY EXERCISE BY ANY PARTY OF THEIR RESPECTIVE RIGHTS UNDER THE LOAN DOCUMENTS AND THE ENVIRONMENTAL INDEMNITY AGREEMENT OR IN ANY WAY RELATING TO THE LOAN OR THE PROJECT (INCLUDING, WITHOUT LIMITATION, ANY ACTION TO RESCIND OR CANCEL THIS AGREEMENT, AND ANY CLAIM OR DEFENSE ASSERTING THAT THIS AGREEMENT WAS FRAUDULENTLY INDUCED OR IS OTHERWISE VOID OR VOIDABLE). THIS WAIVER IS A MATERIAL INDUCEMENT FOR ADMINISTRATIVE AGENT AND EACH LENDER TO ENTER INTO THIS AGREEMENT.

 

Section 11.27      Waiver of Punitive or Consequential Damages. None of Administrative Agent, any Lender, nor Borrowers shall be responsible or liable to the other or to any other Person for any punitive, exemplary or consequential damages which may be alleged as a result of the Loan or the transaction contemplated hereby, including any breach or other default by any party hereto. Borrowers represent and warrant to Administrative Agent and each Lender that as of the Closing Date neither Borrowers nor any other Borrower Party has any claims against Administrative Agent or any Lender in connection with the Loan.

 

Section 11.28      Governing Law. UNLESS OTHERWISE NOTED THEREIN TO THE CONTRARY, THE LOAN DOCUMENTS AND THE ENVIRONMENTAL INDEMNITY AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES THEREUNDER SHALL IN ALL RESPECTS BE GOVERNED BY, AND CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK (WITHOUT GIVING EFFECT TO NEW YORK’ PRINCIPLES OF CONFLICTS OF LAW) AND APPLICABLE UNITED STATES FEDERAL LAW, EXCEPT FOR THOSE PROVISIONS IN THE LOAN DOCUMENTS AND, IF APPLICABLE, THE ENVIRONMENTAL INDEMNITY PERTAINING TO THE CREATION, PERFECTION OR VALIDITY OF OR EXECUTION ON LIENS OR SECURITY INTERESTS ON PROPERTY LOCATED IN THE STATE WHERE THE PROJECT IS LOCATED, WHICH PROVISIONS SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE WHERE THE PROJECT IS LOCATED AND APPLICABLE UNITED STATES FEDERAL LAW.

 

Section 11.29       Entire Agreement. This Agreement, the other Loan Documents and the Environmental Indemnity Agreement embody the entire agreement and understanding between Administrative Agent and each Lender and Borrowers and supersede all prior agreements and understandings between such parties relating to the subject matter hereof and thereof. Accordingly, the Loan Documents and the Environmental Indemnity Agreement may not be contradicted by evidence of prior, contemporaneous, or subsequent oral agreements of the parties. There are no unwritten oral agreements between the parties.

 

 

Section 11.30      Counterparts. This Agreement may be executed in multiple counterparts, each of which shall constitute an original, but all of which shall constitute one document.

 

Section 11.31      Consents and Approvals. To the extent that Administrative Agent, Lenders and/or Required Lenders provide any consent or approval as provided for in this Loan Agreement, such consent shall be limited to the specific matter approved and shall not be construed to (a) relieve Borrowers from compliance with all of the other terms and obligations of the Loan Agreement, (b) constitute a consent to any further similar action (as to which a prospective consent or approval shall be required and may not necessarily be granted), or (c) constitute a consent to any other obligation to which any Lender may be a party.

 

Section 11.32       Effectiveness of Facsimile Documents and Signatures. The Loan Documents and Environmental Indemnity Agreement may be transmitted and/or signed by facsimile or electronic transmission. The effectiveness of any such documents and signatures shall, subject to applicable Law, have the same force and effect as manually signed originals and shall be binding on all parties to the Loan Documents and Environmental Indemnity Agreement, as applicable. Administrative Agent may also require that any such documents and signatures be confirmed by a manually signed original thereof; provided, however, that the failure to request or deliver the same shall not limit the effectiveness of any facsimile document, electronic transmission or signature.

 

Section 11.33      Venue. EACH PARTY HERETO CONSENTS TO THE JURISDICTION OF ANY STATE OR FEDERAL COURT LOCATED WITHIN THE CITY OF NEW YORK, BOROUGH OF MANHATTAN, STATE OF NEW YORK AND IRREVOCABLY AGREES THAT, SUBJECT TO ADMINISTRATIVE AGENT’S ELECTION, ALL ACTIONS OR PROCEEDINGS ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE OTHER LOAN DOCUMENTS SHALL BE LITIGATED IN SUCH COURTS. EACH PARTY HERETO EXPRESSLY SUBMITS AND CONSENTS TO THE JURISDICTION OF THE AFORESAID COURTS AND WAIVES ANY DEFENSE OF FORUM NON CONVENIENS. EACH BORROWER HEREBY WAIVES PERSONAL SERVICE OF ANY AND ALL PROCESS. BORROWERS HEREBY AGREE THAT ALL SERVICE OF PROCESS MAY BE MADE UPON BORROWERS BY CERTIFIED OR REGISTERED MAIL, RETURN RECEIPT REQUESTED, ADDRESSED TO BORROWERS, AT THE ADDRESS SET FORTH IN THIS AGREEMENT AND SERVICE SO MADE SHALL BE DEEMED COMPLETE TEN (10) DAYS AFTER THE SAME HAS BEEN POSTED.

 

Section 11.34      Important Information Regarding Procedures for Requesting Credit. Each of Administrative Agent and Lenders hereby notifies the Borrower Parties that in order to help the government fight the funding of terrorism and money laundering activities, federal law requires all financial institutions to obtain, verify and record information that identifies each individual or business that requests credit. Accordingly, in connection with the loans or any other request for credit, Administrative Agent and Lenders will ask for the business name, business address, Employer Identification Number, and other information which allows them to identify each Borrower Party, and may ask for other identifying documents showing existence of each Borrower Party.

 

 

Section 11.35      Method of Payment. All amounts payable under this Agreement and the other Loan Documents must be paid by Borrowers in accordance with Section 2.6(c). Payments in the form of cash, money order, third party payment, cashier’s check, a check drawn on a foreign bank or non-bank financial institution, or any form of payment other than those provided in the preceding sentence will not be accepted.

 

Section 11.36      Component Note. Administrative Agent, without in any way limiting Administrative Agent’s other rights hereunder, in its sole and absolute discretion, shall have the right at any time to require Borrowers to execute and deliver “component” notes (including senior and junior notes) in replacement of the Note as evidence of the Loan, which notes may be paid in such order of priority as may be designated by Administrative Agent, provided that (i) the aggregate principal amount of such “component” notes shall equal the outstanding principal balance of the Loan immediately prior to the creation of such “component” notes, plus any Loan Commitments of each Lender not yet funded, (ii) the weighted average interest rate of all such “component” notes shall on the date created equal the interest rate which was applicable to the Loan immediately prior to the creation of such “component” notes, (iii) the Debt Service on all such “component” notes shall on the date created equal the Debt Service which was due under the Loan immediately prior to the creation of such component notes and (iv) the other terms and provisions of each of the “component” notes shall be identical in substance and substantially similar in form to the Loan Documents. Borrowers, at no or nominal cost and expense, shall cooperate with all reasonable requests of Administrative Agent in order to establish the “component” notes and shall execute and deliver such documents as shall reasonably be required by Administrative Agent in connection therewith, all in form and substance reasonably satisfactory to Administrative Agent, including, without limitation, the severance of security documents if requested. In the event Borrowers fail to execute and deliver such documents to Administrative Agent within five (5) Business Days following such request by Administrative Agent, Borrowers hereby absolutely and irrevocably appoint Administrative Agent as their true and lawful attorney, coupled with an interest, in its name and stead to make and execute all documents necessary or desirable to effect such transactions, Borrowers ratifying all that such attorney shall do by virtue thereof.

 

Section 11.37      Post-Closing Obligations of Borrowers. Notwithstanding the fact that Borrowers have not satisfied certain of the conditions to the advance of the Loan proceeds as of the Closing Date, Lenders have agreed to advance the proceeds of the Loan to Borrowers, subject to the satisfaction of the requirements set forth in Schedule 11.37 attached hereto.

 

 

Section 11.38      Release and Waiver Regarding Special Audits. Borrowers and Lenders acknowledge that from time to time during the term of the Loan, one or more Lenders and/or Borrowers may request that CONA provide Borrower and/or Lenders (collectively, the “Recipient”) with certain internally generated reports (whether oral and/or written, the “Reports”), which Reports may include oral and/or written information, assessments, notes, memoranda and analyses prepared by employees of CONA for the limited purpose of preparing an audit of the progress one or more of the Projects has made with respect to a plan of correction (or similar remedied obligation of any Borrower or any Operator under any Healthcare Laws) that may be issued from time to time with respect to any Project. With respect to any Reports that may be provided to the Recipient from time to time during the term of the Loan, Lenders and Borrowers hereby acknowledge and agree as follows: (a) the Reports may be prepared based on procedures that may not include all procedures deemed necessary for the Recipient’s own purposes; (b) CONA will not be able or willing to make any recommendations based on the Reports and CONA shall not in any way be deemed a consultant, agent or other representative to the Recipient in any manner; (c) the Recipient does not acquire any rights as a result of the disclosure of the Reports and its access thereto, and CONA assumes no duties or obligations in connection with, or as a result of, such access; (d) the Recipient is not entitled to rely on the Report; (e) the Recipient will not distribute or disclose the Reports or the information contained therein to any third party, except if compelled by legal process, and it will, to the extent permitted by applicable Law, indemnify and hold harmless CONA, together with its employees, officers, advisors and Affiliates from and against any and all claims, losses or expenses (including attorneys’ fees) arising as a result of CONA having disclosed the Reports to the Recipient; (f) the Recipient waives its right to recover from, and releases and discharges any legal action against, CONA with respect to any and all suits, actions, proceedings, investigations, demands, claims, liabilities, fines, penalties, liens, judgments, losses, injuries, damages, settlement expenses or costs of whatever kind or nature, whether direct or indirect, known or unknown, contingent or otherwise, including, without limitation, attorneys’ and experts’ fees and expenses, and investigation and remediation costs that may arise on account of or in any way be connected with the Report; and (g) and with respect to the Reports, CONA is not acting as an agent, fiduciary or representative for the Recipient, and the Recipient will (i) make its own independent investigation of the subject matter of the Reports and (ii) be solely responsible for its own review, assessments, conclusions and decisions with respect to the Loan, the Projects, Borrowers and/or Operator.

 

ARTICLE 12

 

LIMITATIONS ON LIABILITY

 

Section 12.1         Limitation on Liability.

 

(a)           Subject to the qualifications below, neither Administrative Agent nor any Lender shall enforce the liability and obligation of Borrowers to perform and observe the Obligations by any action or proceeding wherein a money judgment shall be sought against Borrowers, except that Administrative Agent and Lenders may bring a foreclosure action, an action for specific performance or any other appropriate action or proceeding to enable Administrative Agent and Lenders to enforce and realize upon its interest under the Note, this Agreement, the Mortgage and the other Loan Documents, or in the Projects, or any other Collateral given to Administrative Agent and Lenders pursuant to the Loan Documents; provided, however, that, except as specifically provided herein, (i) any judgment in any such action or proceeding shall be enforceable against Borrowers only to the extent of Borrowers’ interest in the Projects and in any other collateral given to Administrative Agent and Lenders to secure the Obligations, and (ii) Administrative Agent and each Lender, as applicable, by accepting the Note, this Agreement, the Mortgage and the other Loan Documents, shall not sue for, seek or demand any deficiency judgment against Borrowers in any such action or proceeding under or by reason of or under or in connection with the Note, this Agreement, the Mortgage or the other Loan Documents.

 

 

(b)           The provisions of this Section 12.1 shall not, however, (i) constitute a waiver, release or impairment of any Obligation evidenced or secured by any of the Loan Documents; (ii) impair the right of Administrative Agent or any Lender to name any Borrower as a party defendant in any action or suit for foreclosure and sale under the Mortgage; (iii) affect the validity or enforceability of any guaranty made in connection with the Loan or Obligations or any of the rights and remedies of Administrative Agent or any Lender thereunder; (iv) impair the right of Administrative Agent or any Lender to obtain the appointment of a receiver; (v) impair the enforcement of the assignment of leases and rents provisions set forth in the Mortgages; (vi) constitute a prohibition against Administrative Agent or any Lender to commence any appropriate action or proceeding in order for Administrative Agent or any Lender to exercise its remedies against any Project; or (vii) constitute a waiver of the right of Administrative Agent or any Lender to enforce the liability and obligation of Borrowers, by money judgment or otherwise, to the extent of any Liability, which may be imposed upon, incurred by or awarded against Administrative Agent or any Lender or any Affiliate thereof as a result of, arising out of or in connection with (and Borrowers shall be personally liable and shall indemnify Administrative Agent and such Lender for) the following:

 

(i)             any failure by any Borrower or any other Borrower Party after the occurrence and during the continuance of any Event of Default to apply any portion of the gross income from the Projects at any time received by any Borrower or any other Borrower Party or any of their Affiliates to amounts due under the Loan or to customary operating expenses of the Projects or as otherwise permitted under the Loan Documents;

 

(ii)            commission of a criminal act by any Borrower Party, Guarantor or any Affiliate or agent of any Borrower Party or Guarantor (which agent is under the control of such Borrower Party or such Guarantor) which results in the exercise by any Person of Forfeiture Rights with respect to a Project;

 

(iii)           the failure by any Borrower or any other Borrower Party to apply any insurance proceeds and condemnation awards in accordance with the terms of the Loan Documents;

 

(iv)           any intentional material misrepresentation by any Borrower or any other Borrower Party made in or in connection with the Loan Documents or the Loan;

 

(v)            any assertion of defenses or counterclaims made by any Borrower Party in bad faith (as reasonably determined by Administrative Agent) that hinders, delays or interferes in any material respect with the enforcement by Administrative Agent or Lender of its rights under the Loan Documents or the realization of the Collateral;

 

 

(vi)           any Borrower’s failure to turn over to Administrative Agent all Security Deposits upon Administrative Agent’s demand following an Event of Default except to the extent such Security Deposits were applied in accordance with the terms and conditions of any of the applicable leases prior to the occurrence of the Event of Default;

 

(vii)          to the extent of the income received from its respective Project and after payment of scheduled debt service on the Loan, any Borrower’s failure to maintain insurance as required by the Loan Agreement unless such failure arises because Lender does not provide any Borrower funds pursuant to Section 3.4 to make such payments;

 

(viii)         Borrowers’ failure to pay any Taxes or assessments affecting the Projects before the delinquency thereof, in each case (1) to the extent that Borrowers failed to apply cash flow from the Projects to do so, and (2) there are not sufficient funds available to Administrative Agent in the Tax Impound to pay such Taxes or assessments;

 

(ix)           damage or destruction to any Project caused by the intentional acts or omissions of any Borrower or any other Borrower Party; provided, that in the case of the failure to repair or any other matter involving the expenditure of funds, there shall be no liability unless there is available cash flow from the Project to complete such repair or other item involving the expenditure of funds;

 

(x)            any Borrower or any other Borrower Party’s failure to perform its obligations under the Environmental Indemnity Agreement, subject to notice and cure periods and without duplication of liability under the Environmental Indemnity Agreement;

 

(xi)           material physical waste of any Project (excluding alterations made in good faith) that occurred prior to the date (a) a receiver was appointed with respect to such Project, (b) such Project was transferred pursuant to a foreclosure or deed in lieu of foreclosure, or (c) Administrative Agent or any Lender took possession and/or control of the Project;

 

(xii)          the removal or disposal of any material personal property from any Project owned by Borrowers in which Administrative Agent or the Lenders have a security interest in violation of the terms and conditions of the Loan Documents unless (a) replaced with personal property of the same utility and of the same or greater value and ability, as reasonably determined by Administrative Agent or (b) such removal takes place in the ordinary course of operations of the applicable Project and does not constitute material physical waste;

 

(xiii)        the payment of any distributions to any Borrower or any Guarantor or any of their Affiliates that are expressly prohibited by this Agreement;

 

 

(xiv)         any fees paid by Borrowers to Guarantor or any of its Affiliates or employees, after the occurrence and during the continuation of an Event of Default in breach of the terms of the Loan Documents;

 

(xv)          the commission of fraud by any Borrower or any other Borrower Party in connection with the Loan; or

 

(xvi)         all costs and expenses, court costs and costs of appeal incurred by Administrative Agent or any Lender in collecting any amount due Administrative Agent or any Lender hereunder.

 

(c)           Notwithstanding anything to the contrary in this Agreement, the Note or any of the Loan Documents, all of the Obligations shall be fully recourse to Borrowers and Borrowers shall be personally liable therefor in the event of:

 

(i)            any Transfer of any Project or any interest in any Restricted Party in breach of any of the covenants in the Loan Agreement or the Mortgage;

 

(ii)           any Borrower’s failure to comply with the covenants in Section 5.18 hereof and such failure results in the actual or substantive consolidation in whole or in part of any Borrower’s assets with the assets of another Person in any bankruptcy or insolvency proceeding;

 

(iii)          any Borrower Party files a voluntary petition under the Bankruptcy Code or any other Federal or state bankruptcy or insolvency law;

 

(iv)          a Person, an Affiliate, officer, director, or representative which Controls any Borrower Party files, or joins in the filing of, an involuntary petition against any Borrower under the Bankruptcy Code or any other Federal or state bankruptcy or insolvency law, or solicits or causes to be solicited petitioning creditors for any involuntary petition against any Borrower from any Person;

 

(v)           any Borrower Party files an answer consenting to or otherwise acquiescing in or joining in any involuntary petition filed against any Borrower, by any other Person under the Bankruptcy Code or any other Federal or state bankruptcy or insolvency law, or solicits or causes to be solicited petitioning creditors for any involuntary petition against any Borrower from any Person;

 

(vi)          any Affiliate, officer, director, or representative which Controls Borrowers consents to or acquiesces in or joins in an application for the appointment of a custodian, receiver, trustee, or examiner for any Borrower or any portion of the Collateral (other than to the extent such petition or application is brought by Administrative Agent); or

 

(vii)         any Borrower Party makes an assignment for the benefit of creditors, or admits, in writing (other than to the Administrative Agent) or in any legal proceeding, its insolvency or inability to pay its debts as they become due; provided, however, that no Borrower Party shall have any liability under this Section for any answer or submission of facts required by applicable law in any non-collusive, involuntary bankruptcy proceeding or other non-collusive litigation, including providing a list of Borrowers’ or Guarantors’ assets and liabilities.

 

 

(d)           Borrowers also shall be personally liable to Administrative Agent and Lenders for any and all reasonable attorneys’ fees and expenses and court costs incurred by Administrative Agent and Lenders in enforcing this Section 12.1 or otherwise incurred by Administrative Agent or any Lender in connection with any of the foregoing matters, regardless whether such matters are legal or equitable in nature or arise under tort or contract law. The limitation on the personal liability of Borrowers in this Section 12.1 shall not modify, diminish or discharge the personal liability of any Guarantor under any Guaranty. Nothing herein shall be deemed to be a waiver of any right which Administrative Agent or any Lender may have under Sections 506(a), 506(b), 1111(b) or any other provision of the United States Bankruptcy Code, as such sections may be amended, or corresponding or superseding sections of the Bankruptcy Amendments and Federal Judgeship Act of 1984, to file a claim for the full amount due to Administrative Agent and Lenders under the Loan Documents or to require that all collateral shall continue to secure the amounts due under the Loan Documents.

 

Section 12.2         Limitation on Liability of Administrative Agent and Lenders’ Officers, Employees, Etc. Any obligation or liability whatsoever of Administrative Agent or any Lender which may arise at any time under this Agreement, any other Loan Document, or the Environmental Indemnity Agreement shall be satisfied, if at all, out of Administrative Agent’s or such Lender’s assets only. No such obligation or liability shall be personally binding upon, nor shall resort for the enforcement thereof be had to, the property of any of Administrative Agent’s or such Lender’s shareholders, directors, officers, employees or agents, regardless of whether such obligation or liability is in the nature of contract, tort or otherwise. None of Administrative Agent and its Related Persons shall be liable for any action taken or omitted to be taken by any of them under or in connection with any Loan Document or the Environmental Indemnity Agreement in its capacity as Administrative Agent (or Related Person of Administrative Agent), and Borrowers (on their own behalf and on behalf of the other Borrower Parties) hereby waive and shall not assert any right, claim or cause of action based thereon, except to the extent of liabilities resulting primarily from the gross negligence or willful misconduct of Administrative Agent or, as the case may be, such Related Person (each as determined in a final, non-appealable judgment by a court of competent jurisdiction) in connection with the duties expressly set forth herein.

 

[Continued on following page.]

 

 

EXECUTED as of the date first written above.

 

ADMINISTRATIVE AGENT:
CAPITAL ONE, NATIONAL ASSOCIATION

 

By:	/s/ Jason LaGrippe
Name:	Jason LaGrippe
Title:	Duly Authorized Signatory

 

[Signatures Continued on Following Page]

 

 

 

SOLE LEAD ARRANGER AND BOOKRUNNER AND LENDER:	CAPITAL ONE, NATIONAL ASSOCIATION
	By:	/s/ Jason LaGrippe
	Name:	Jason LaGrippe
	Title:	Duly Authorized Signatory

 

[Signatures Continued on Following Page]

 

 

BORROWERS:

 

	ARHC LVHLDMI01, LLC
	ARHC BMBUCMI01, LLC
	ARHC SPPLSIA01, LLC
	ARHC PHOTTIA01, LLC
	ARHC SCCRLIA01, LLC
	ARHC PHCTNIA01, LLC
	ARHC TVTITFL01, LLC
	ARHC SMMTEIA01, LLC
	ARHC CWEVAGA01, LLC
	ARHC PPDWTMI01, LLC
	ARHC PCCHEMI01, LLC
	ARHC PCPLSMI01, LLC
	ARHC GOFENMI01, LLC
	ARHC CSKENMI01, LLC
	ARHC SMMDSIA01, LLC
	ARHC SFFLDIA01, LLC
	ARHC ALALPGA01, LLC
	ARHC PSINDIA01, LLC
	ARHC BWBRUGA01, LLC
	ARHC DBDUBGA01, LLC
	ARHC PHTIPIA01, LLC
	ARHC OPBROOR01, LLC
	ARHC ALELIKY01, LLC,
	each a Delaware limited liability company

 

	By:	/s/ Michael Anderson
		Name:	Michael Anderson
		Title:	Authorized Signatory

 

 

For the purposes of Section 6.7 only, the undersigned acknowledges and agrees to its appointment as Borrower Representative.

 

	HEALTHCARE TRUST OPERATING
	PARTNERSHIP, L.P., a Delaware limited partnership
	By:	Healthcare Trust, Inc., a Maryland corporation, its general partner
		By:	/s/ Michael Anderson
			Name:Michael Anderson
			Title:  Authorized Signatory

 

 

EXHIBIT A-1

 

DESCRIPTION OF PROJECTS

 

Borrower:

ARHC LVHLDMI01, LLC

 

Name of Project:

Lakeside Vista

 

Address of Project:

340 West 40th Street, Holland Michigan 49423 (Allegan County)

 

Legal Description of Land:

 

Land situated in the City of Holland, County of Allegan, Michigan, more particularly described as:

 

THAT PART OF THE EAST 1/2, NORTHWEST 1/4, SOUTHEAST 1/4, SECTION 6, TOWN 4 NORTH, RANGE 15 WEST, HOLLAND CITY, ALLEGAN COUNTY, MICHIGAN, DESCRIBED AS:

 

BEGINNING AT THE NORTHEAST CORNER OF THE NORTHWEST 1/4, SOUTHEAST 1/4, SAID SECTION 6; THENCE SOUTH 00 DEGREES 52 MINUTES 49 SECONDS EAST 716.00 FEET ALONG THE EAST LINE OF SAID NORTHWEST 1/4, SOUTHEAST 1/4; THENCE NORTH 89 DEGREES 46 MINUTES 35 SECONDS WEST 660.83 FEET ALONG THE SOUTH LINE OF THE NORTH 716.00 FEET OF SAID EAST 1/2, NORTHWEST 1/4, SOUTHEAST 1/4; THENCE NORTH 00 DEGREES 51 MINUTES 51 SECONDS WEST 716.00 FEET ALONG THE WEST LINE OF SAID EAST 1/2, NORTHWEST 1/4, SOUTHEAST 1/4; THENCE SOUTH 89 DEGREES 46 MINUTES 35 SECONDS EAST 660.63 FEET ALONG THE NORTH LINE OF SAID SOUTHEAST 1/4 TO THE BEGINNING.

 

 

EXHIBIT A-2

 

DESCRIPTION OF PROJECTS

 

Borrower:

ARHC BMBUCMI01, LLC

 

Name of Project:

Buchanan Meadows

 

Address of Project:

809 Carrol Street, Buchanan, Michigan 49107 (Berrien County)

 

Legal Description of Land:

 

Land situated in the Township of Buchanan, County of Berrien, Michigan, more particularly described as:

 

PARCEL NO. 1:

 

THAT PART OF THE NORTHWEST 1/4 OF SECTION 36, TOWNSHIP 7 SOUTH, RANGE 18 WEST, DESCRIBED AS FOLLOWS: COMMENCING AT THE WEST 1/4 CORNER OF SAID SECTION 36; THENCE NORTH 89 DEGREES 44 MINUTES 49 SECONDS ALONG THE EAST AND WEST 1/4 LINE OF SAID SECTION 36, A DISTANCE OF 1923.87 FEET TO THE SOUTHEAST CORNER OF THE RECORDED PLAT OF PARKRIDGE NO. 1, RECORDED AUGUST 15, 1955 IN VOLUME 14 OF PLATS, PAGE 24; THENCE NORTH 00 DEGREES 15 MINUTES 50 SECONDS EAST ALONG THE EASTERLY LINE OF SAID PLAT, 191.30 FEET TO THE TRUE POINT OF BEGINNING OF THE LAND HEREIN DESCRIBED; THENCE CONTINUING NORTH 00 DEGREES 15 MINUTES 50 SECONDS EAST ALONG THE EASTERLY PLAT LINE, 315.60; THENCE SOUTH 89 DEGREES 47 MINUTES 47 SECONDS EAST, 214.00 FEET; THENCE SOUTH 00 DEGREES 15 MINUTES 50 SECONDS WEST, 313.88 FEET; THENCE SOUTH 89 DEGREES 44 MINUTES 49 SECONDS WEST, 214.01 FEET TO THE POINT OF BEGINNING.

 

TOGETHER WITH A 30 FOOT WIDE EASEMENT FOR INGRESS AND EGRESS PARALLEL, ADJACENT TO AND SOUTH OF THE SOUTH LINE OF THE ABOVE DESCRIBED PARCEL OF LAND;

 

ALSO TOGETHER WITH AN EASEMENT FOR PARKING DESCRIBED AS FOLLOWS: COMMENCING AT THE SOUTHEAST CORNER OF THE ABOVE DESCRIBED PARCEL OF LAND; THENCE NORTH 00 DEGREES 15 MINUTES 50 SECONDS EAST, 30 FEET TO THE POINT OF BEGINNING OF THIS DESCRIPTION; THENCE CONTINUING NORTH 00 DEGREES 15 MINUTES 50 SECONDS EAST, 89.01 FEET; THENCE NORTH 89 DEGREES 44 MINUTES 49 SECONDS EAST, 71.03 FEET; THENCE SOUTH 00 DEGREES 15 MINUTES 50 SECONDS WEST, 89.01 FEET; THENCE SOUTH 89 DEGREES 44 MINUTES 49 SECONDS WEST, 71.03 FEET TO THE POINT OF BEGINNING.

 

 

PARCEL NO. 2:

 

THAT PART OF THE NORTHWEST 1/4 OF SECTION 36, TOWNSHIP 7 SOUTH, RANGE 18 WEST, DESCRIBED AS FOLLOWS: COMMENCING AT THE WEST 1/4 CORNER OF SAID SECTION 36; THENCE NORTH 89 DEGREES 44 MINUTES 49 SECONDS EAST, ALONG THE EAST AND WEST 1/4 LINE OF SAID SECTION 36, A DISTANCE OF 1923.87 FEET TO THE SOUTHEAST CORNER OF THE RECORDED PLAT OF PARKRIDGE NO. 1, RECORDED AUGUST 15, 1955, IN VOLUME 14 OF PLATS, PAGE 24; THENCE NORTH 00 DEGREES 15 MINUTES 50 SECONDS EAST, ALONG THE EASTERLY LINE OF SAID PLAT, 506.90 FEET TO THE TRUE POINT OF BEGINNING OF THE LAND HEREIN DESCRIBED; THENCE CONTINUING NORTH 00 DEGREES 15 MINUTES 50 SECONDS EAST ALONG SAID EASTERLY PLAT LINE, 151.94 FEET; THENCE SOUTH 89 DEGREES 47 MINUTES 47 SECONDS EAST, 213.08 FEET; THENCE SOUTH 00 DEGREES 05 MINUTES 05 SECONDS EAST, 151.94 FEET; THENCE NORTH 89 DEGREES 47 MINUTES 47 SECONDS WEST, 214.00 FEET TO THE POINT OF BEGINNING.

 

PARCEL NO. 3:

 

THAT PART OF THE NORTHWEST QUARTER OF SECTION 36, TOWNSHIP 7 SOUTH, RANGE 18 WEST, CITY OF BUCHANAN, BERRIEN COUNTY, MICHIGAN, DESCRIBED AS FOLLOWS: COMMENCING AT THE WEST QUARTER CORNER SAID SECTION 36; THENCE NORTH 89° 44' 49" EAST ALONG THE EAST AND WEST QUARTER LINE SAID SECTION 36 A DISTANCE OF 1923.87 FEET TO THE SOUTHEAST CORNER OF THE RECORDED PLAT OF PARKRIDGE NO. 1, RECORDED AUGUST 15, 1955 IN VOLUME 14 OF PLATS, PAGE 24;

 

THENCE NORTH 00° 15' 50" EAST ALONG THE EASTERLY LINE SAID PLAT 191.30 FEET; THENCE NORTH 89° 44' 49" EAST 214.01 FEET TO THE TRUE POINT OF BEGINNING OF THE LAND HEREIN DESCRIBED; THENCE NORTH 00° 15' 50" EAST 313.88 FEET; THENCE SOUTH 89° 47' 47" EAST 197.69 FEET; THENCE SOUTH 00° 22'41" WEST 312.31 FEET; THENCE SOUTH 89° 44' 49" WEST 197.01 FEET TO THE POINT OF BEGINNING; TOGETHER WITH A THIRTY (30) FOOT WIDE EASEMENT FOR INGRESS AND EGRESS PARALLEL, ADJACENT TO AND SOUTH OF THE SOUTH LINE OF THE ABOVE DESCRIBED PARCEL OF LAND.

 

PARCEL NO. 4:

 

THAT PART OF THE NORTHWEST QUARTER OF SECTION 36, TOWNSHIP 7 SOUTH, RANGE 18 WEST, CITY OF BUCHANAN, BERRIEN COUNTY, MICHIGAN, DESCRIBED AS FOLLOWS: COMMENCING AT THE WEST QUARTER CORNER SAID SECTION 36; THENCE NORTH 89° 44' 49" EAST ALONG THE EAST AND WEST QUARTER LINE SAID SECTION 36 A DISTANCE OF 1923.87 FEET TO THE SOUTHEAST CORNER OF THE RECORDED PLAT OF PARKRIDGE NO. 1, RECORDED AUGUST 15, 1955 IN VOLUME 14 OF PLATS, PAGE 24;

 

THENCE NORTH 00° 15' 50" EAST ALONG THE EASTERLY LINE SAID PLAT 161.30 FEET; THENCE NORTH 89° 44' 49" EAST 410.96 FEET; THENCE NORTH 00° 22' 41" EAST 342.31 FEET TO THE TRUE POINT OF BEGINNING OF THE LAND HEREIN DESCRIBED; THENCE NORTH 89° 47' 47" WEST 197.69 FEET; THENCE NORTH 00° 05' 05" WEST 151.94 FEET; THENCE NORTH 75° 20' 11" EAST 205.97 FEET; THENCE SOUTH 00° 22' 41" WEST 204.97 FEET TO THE POINT OF BEGINNING.

 

 

EXHIBIT A-3

 

DESCRIPTION OF PROJECTS

 

Borrower:

ARHC SPPLSIA01, LLC

 

Name of Project:

Sunnybrook of Mt. Pleasant

 

Address of Project:

1406 East Linden Drive, Mount Pleasant, Iowa 52641 (Henry County)

 

Legal Description of Land:

 

Lot 3, Ashford Park Subdivision to the City of Mt. Pleasant, Henry County, Iowa in Plat Book 2004, Page 98.

 

 

EXHIBIT A-4

 

DESCRIPTION OF PROJECTS

  

Borrower:

ARHC PHOTTIA01, LLC

 

Name of Project:

Prairie Hills at Ottumwa

 

Address of Project:

173 E. Rochester Road, Ottumwa, Iowa 52501 (Wapello County)

 

Legal Description of Land:  

 

Parcel A:

 

All units in Prairie Hills at Ottumwa, a Condominium, together with all appurtenances thereto including an undivided fractional interest in the common elements, areas and facilities as determined for said unit by the provisions of, and in accordance with, the Declaration of Submission to Horizontal Property Regime for Prairie Hills at Ottumwa, a Condominium, filed in the office of the Recorder of Wapello County, Iowa, on December 6, 2010, in Book 12-K, Page 656, as Document 2010 5167, and re-filed on December 30, 2011, in Book 13-L, Page 96, as Document 2011 5676, as amended by the First Amendment to the Declaration of Submission to Horizontal Property Regime for Prairie Hills at Ottumwa, a Condominium, dated September 27, 2012, recorded October 23, 2012, in Book 13-L, Page 338, as Doc. No. 2012 4670.

 

Prairie Hills at Ottumwa, a Condominium, as presently constituted, is located on a part of Tracts 2 and 4 of the South Half of the Southwest Fractional Quarter of Section 6, Township 72 North, Range 13 West of the 5th Principal Meridian in the City of Ottumwa, Wapello County, Iowa, as described in the survey records file in the office of Wapello County Auditor: Commencing at a Point 1320.0 feet East of the Southwest corner of said South 1/2 of the SW Fractional Quarter Section 6, said point also being the Southwest corner of Kirk's First Addition; thence North 89 degrees 35 minutes 07 seconds West 224. 7 4 feet along the centerline of East Rochester Street; thence North 02 degrees 00 minutes 06 seconds East 33.01 feet to the North line of East Rochester Street and the point of beginning for this description; thence North 02 degrees 00 minutes 06 seconds East 391.68 feet (1.0 foot easterly of the existing chain link fence); thence North 87 degrees 13 minutes 44 seconds West 259.67 feet (1.0 foot northerly of the existing chain link fence); thence North 00 degrees 03 minutes 23 seconds East 125. 79 feet to the Southwest corner of Tract 4; thence North 00 degrees 02 minutes 09 seconds East 329.25 feet to the Northwest corner of Tract 4; thence South 89 degrees 36 minutes 00 seconds East 469.61 feet to the Northeast corner of Tract 4; thence South 00 degrees 01 minutes 16 seconds West 329.50 feet to the Northeast corner of Tract 2; thence South 00 degrees 03 minutes 22 seconds West 527.88 feet to the North line of East Rochester Street; thence North 89 degrees 35 minutes 07 seconds West 223.61 feet to the point of beginning, excepting therefrom Lot 1, in Prairie Hills Addition, an Official Plat, now included in and forming a part of the City of Ottumwa, Iowa.

 

(The North line of Tract 4 is South 89 degrees 36 minutes 00 seconds East for this description.)

 

  

Parcel B:

 

Non-exclusive easements over Lot 1, Prairie Hills Addition, an Official Plat, as contained in the Declaration of Easements included in the Dedication and Consent to Plat, recorded October 23, 2012, in the office of the Wapello County Recorder in Book 13-L, Page 322, as Document Number 2012 4669.

 

Parcel C:

 

Non-exclusive Sewer Easement Recorded August 17, 2006 in Book 2006, Page 4444 as Document Number 2006-4444.

 

EXHIBIT A-5

 

DESCRIPTION OF PROJECTS

 

 

Borrower:

ARHC SCCRLIA01, LLC

 

Name of Project:

Sunnybrook of Carroll

 

Address of Project:

1214 East 18th Street, Carroll, Iowa 51401 (Carroll County)

 

Legal Description of Land:

 

Units 201 through 215, inclusive;

Units 301 through 320, inclusive;

Units 401 through 415, inclusive;

 

Units 501, 502, 504, 506 through 520, inclusive, 522 and 524 through 528, inclusive, within Prairie Hills at Clinton, a Condominium, together with an undivided interest in the limited and general Common Elements appurtenant to each unit as provided in the Declaration of Submission of Property to Horizontal Property Regime recorded December 29, 2006 as Instrument No. 2006-1130, as amended by the Amendment recorded December 17, 2009, as Instrument No. 2009-10521 and said Horizontal Property Regime is located upon the following described property:

 

Part of the Northwest quarter (NW1/4) of the Northeast quarter (NE1/4) of Section Two (2), Township eighty-one (81) North, Range Six (6), East of the 5th P.M., City of Clinton, Clinton County, Iowa, more particularly described as follows:

 

Commencing at the North quarter corner of said Section Two (2); thence North 87° 25' 19" East along the North line of said Northeast quarter (NE1/4), a distance of fifty and no-hundredths (50.00) feet; thence South 2° 13' 59" East, a distance of fifty-nine and no-hundredths (59.00) feet to the point of beginning at the intersection of the East right of way line of 18th Street North and the South right of way line of 13th Avenue North; thence following said South right of way line of 13th Avenue North, North 87° 25' 19" East, a distance of ninety-five and no-hundredths (95.00) feet; thence North 2°13' 56" West, a distance of nine and no-hundredths (9.00) feet; thence North 87° 25' 19" East, a distance of seven hundred forty-seven and thirteen-hundredths (747.13) feet to the West line of a parcel described in Warranty Deed recorded in Deed Book 590 at Page 354; thence following the West and South line of said parcel, South 2° 12' 59" East, a distance of four hundred fifty-three and no-hundredths (453.00) feet; thence North 87° 25' 19" East, a distance of four hundred thirty-three and no-hundredths (433.00) feet to the East line of said Northwest quarter (NW1/4) of the Northeast quarter (NE1/4); thence South 2° 12' 59" East along said East line, a distance of three hundred eighty-four and eighty one-hundredths (384.81) feet; thence South 87° 25' 19" West, a distance of one thousand two hundred seventy-four and ninety-hundredths (1274.90) feet to the East right of way line of 18th Street North; thence North 2° 13' 56" West along said right of way line, a distance of eight hundred twenty-eight and eighty-one-hundredths (828.81) feet to the point of beginning.

 

  

EXHIBIT A-6

 

DESCRIPTION OF PROJECTS

 

 

Borrower:

ARHC PHCTNIA01, LLC

 

Name of Project:

Prairie Hills at Clinton

 

Address of Project:

1701 13th Avenue North, Clinton, Iowa 52732 (Clinton County)

 

Legal Description of Land:

 

Units 201 through 215, inclusive;

Units 301 through 320, inclusive;

Units 401 through 415, inclusive;

 

Units 501, 502, 504, 506 through 520, inclusive, 522 and 524 through 528, inclusive, within Prairie Hills at Clinton, a Condominium, together with an undivided interest in the limited and general Common Elements appurtenant to each unit as provided in the Declaration of Submission of Property to Horizontal Property Regime recorded December 29, 2006 as Instrument No. 2006-1130, as amended by the Amendment recorded December 17, 2009, as Instrument No. 2009-10521 and said Horizontal Property Regime is located upon the following described property:

 

Part of the Northwest quarter (NW1/4) of the Northeast quarter (NE1/4) of Section Two (2), Township eighty-one (81) North, Range Six (6), East of the 5th P.M., City of Clinton, Clinton County, Iowa, more particularly described as follows:

 

Commencing at the North quarter corner of said Section Two (2); thence North 87° 25' 19" East along the North line of said Northeast quarter (NE1/4), a distance of fifty and no-hundredths (50.00) feet; thence South 2° 13' 59" East, a distance of fifty-nine and no-hundredths (59.00) feet to the point of beginning at the intersection of the East right of way line of 18th Street North and the South right of way line of 13th Avenue North; thence following said South right of way line of 13th Avenue North, North 87° 25' 19" East, a distance of ninety-five and no-hundredths (95.00) feet; thence North 2°13' 56" West, a distance of nine and no-hundredths (9.00) feet; thence North 87° 25' 19" East, a distance of seven hundred forty-seven and thirteen-hundredths (747.13) feet to the West line of a parcel described in Warranty Deed recorded in Deed Book 590 at Page 354; thence following the West and South line of said parcel, South 2° 12' 59" East, a distance of four hundred fifty-three and no-hundredths (453.00) feet; thence North 87° 25' 19" East, a distance of four hundred thirty-three and no-hundredths (433.00) feet to the East line of said Northwest quarter (NW1/4) of the Northeast quarter (NE1/4); thence South 2° 12' 59" East along said East line, a distance of three hundred eighty-four and eighty one-hundredths (384.81) feet; thence South 87° 25' 19" West, a distance of one thousand two hundred seventy-four and ninety-hundredths (1274.90) feet to the East right of way line of 18th Street North; thence North 2° 13' 56" West along said right of way line, a distance of eight hundred twenty-eight and eighty-one-hundredths (828.81) feet to the point of beginning.

 

  

EXHIBIT A-7

 

DESCRIPTION OF PROJECTS

 

Borrower:

ARHC TVTITFL01, LLC

 

Name of Project:

Addington Place of Titusville

 

Address of Project:

497 N. Washington Avenue, Titusville, Florida 32796 (Brevard County)

 

Legal Description of Land:

 

THAT PORTION OF THE EAST 23.70 ACRES OF THE NORTHEAST 1/4 OF THE SOUTHEAST 1/4 OF SECTION 33, TOWNSHIP 21 SOUTH, RANGE 35 EAST, BREVARD COUNTY, FLORIDA, BEING A PORTION OF PROPERTY LYING NORTH OF U.S. HIGHWAY No.1, AND WEST OF A LINE AS RECORDED IN THAT CERTAIN "AGREEMENT ESTABLISHING BOUNDARY LINE BY AGREEMENT" AS DESCRIBED IN OFFICIAL RECORDS BOOK 6164, PAGE 493 AND DEPICTED ON SURVEY MAP RECORDED IN SURVEY BOOK 12, PAGE 89, BEING FURTHER DESCRIBED AS FOLLOWS:

 

COMMENCING AT A PK NAIL WITH CERTIFIED CORNER RECORD IDENTIFICATION NUMBER 92363 AT THE SOUTHEAST CORNER OF SAID SECTION 33, THENCE NORTH 00° 47' 30" WEST, ALONG THE EAST LINE OF THE SOUTHEAST 1/4 OF THE SOUTHEAST 1/4 OF SAID SECTION 33, A DISTANCE OF 1326.51 FEET TO A PK NAIL AND DISK STAMPED LB 6762 AT THE SOUTHEAST CORNER OF THE NORTHEAST 1/4 OF THE SOUTHEAST 1/4 OF SAID SECTION 33; THENCE NORTH 89° 58' 59" WEST, ALONG THE SOUTH LINE OF SAID NORTHEAST 1/4 OF THE SOUTHEAST 1/4 OF SAID SECTION 33, A DISTANCE OF 237.04 FEET; THENCE NORTH 00° 42' 37" WEST A DISTANCE OF 249.79 FEET TO A POINT LYING ON THE NORTHERLY RIGHT OF WAY LINE OF U.S. HIGHWAY NO. 1, SAID POINT BEING AT FLORIDA STATE PLANE EAST ZONE COORDINATES (1558058.45 NORTH - 715351.73 EAST) SAID POINT BEING THE POINT OF BEGINNING OF THE HEREIN DESCRIBED PROPERTY AND THE POINT OF BEGINNING OF THE LINE AS DESCRIBED IN THAT CERTAIN "AGREEMENT ESTABLISHING BOUNDARY LINE BY AGREEMENT" AS DESCRIBED IN OFFICIAL RECORDS BOOK 6164, PAGE 493 AND DEPICTED ON SURVEY MAP AS RECORDED IN SURVEY BOOK 12, PAGE 89; THENCE NORTH 00° 42' 37" WEST A DISTANCE OF 167.29 FEET; THENCE SOUTH 89° 17' 23" WEST A DISTANCE OF 3.00 FEET; THENCE NORTH 00° 42' 37'' WEST A DISTANCE OF 288.95 FEET; THENCE SOUTH 89°17' 23" WEST A DISTANCE OF 8.00 FEET; THENCE NORTH 00°42' 37" WEST A DISTANCE OF 8.00 FEET; THENCE NORTH 89° 17' 23" EAST A DISTANCE OF 6.00 FEET; THENCE NORTH 00°42' 37" WEST A DISTANCE OF 385.43 FEET; THENCE SOUTH 89° 17' 23" WEST A DISTANCE OF 10.00 FEET; THENCE NORTH 00° 42' 37" WEST A DISTANCE OF 12.00 FEET; THENCE NORTH 89' 17' 23" EAST A DISTANCE OF 11.00 FEET; THENCE NORTH 00' 42' 37" WEST A DISTANCE OF 214.72 FEET TO A POINT LYING ON THE NORTH LINE OF THE NORTHEAST 1/4 OF THE SOUTHEAST 1/4 OF SAID SECTION 33 AND SAID POINT BEING THE POINT OF TERMINATION OF THE LINE HEREIN DESCRIBED (SAID POINT OF TERMINATION BEING AT FLORIDA STATE PLANE LAST ZONE COORDINATES (1559134.65 NORTH - 715334.95 EAST) AS DESCRIBED IN THAT CERTAIN "AGREEMENT ESTABLISHING BOUNDARY LINE BY AGREEMENT", RECORDED IN OFFICIAL RECORDS BOOK 6164, PAGE 493 AND DEPICTED ON SURVEY MAP AS RECORDED IN SURVEY BOOK 12, PAGE 89; THENCE FROM SAID POINT OF TERMINATION SOUTH 89°30' 02" WEST, A DISTANCE OF 538.26 FEET TO THE NORTHWEST CORNER OF THE EAST 23.70 ACRES OF THE NORTHEAST 1/4 OF THE SOUTHEAST 1/4 OF SECTION 33; THENCE DEPARTING SAID NORTH LINE OF THE NORTHEAST 1/4 OF THE SOUTHEAST 1/4 OF SAID SECTION 33, SOUTH 00°42' 37" EAST, A DISTANCE OF 992.04 FEET TO THE NORTHERLY RIGHT OF WAY LINE OF U.S. HIGHWAY No. 1; THENCE ALONG SAID NORTHERLY RIGHT OF WAY LINE OF U.S. HIGHWAY NO. 1 ALONG A CURVE TO THE LEFT BEING CONCAVE NORTHEASTERLY, HAVING A RADIUS OF 1983.48 FEET AND TO WHICH POINT A RADIAL LINE BEARS SOUTH 16° 17' 30" WEST,; THENCE SOUTHEASTERLY ALONG THE ARC OF SAID CURVE A DISTANCE OF 550.85 FEET, SAID CURVE HAVING A CENTRAL ANGLE OF 15°54' 44", A CHORD DISTANCE OF 549.09 FEET WHICH BEARS SOUTH 81°39' 52" EAST TO THE POINT OF BEGINNING.

 

For informational purposes only:

Property Address: 497 N. Washington Avenue

City/State: Titusville, Florida

County: Brevard

PIN/Tax ID#: 2109358

 

 

EXHIBIT A-8

 

DESCRIPTION OF PROJECTS

 

Borrower:

ARHC SMMTEIA01, LLC

 

Name of Project:

Sunnybrook of Muscatine

 

Address of Project:

3515 Diana Queen Drive, Muscatine, Iowa 52761 (Muscatine County)

 

Legal Description of Land:

 

Lots 1 and 2, of Riverbend Fifth Addition to the City of Muscatine, in Muscatine County, Iowa.

 

 

EXHIBIT A-9

 

DESCRIPTION OF PROJECTS

 

Borrower:

ARHC CWEVAGA01, LLC

 

Name of Project:

Camellia Walk Assisted Living and Memory Care

 

Address of Project:

3949 Evans to Locks Road, Evans, Georgia 30809 (Columbia County)

 

Legal Description of Land:

 

ALL THAT TRACT OR PARCEL OF LAND WITH ANY IMPROVEMENTS THEREON, SITUATE, LYING AND BEING IN THE 125TH GENERAL MILITIA DISTRICT OF COLUMBIA COUNTY, GEORGIA BEING MORE PARTICULARLY DESCRIBED AS FOLLOWS:

 

COMMENCING AT THE NORTHEASTERN INTERSECTION OF EVANS TO LOCKS ROAD (C.R. #1236) RIGHT OF WAY VARIES AND JONES LANDING COURT (C.R. #1761) RIGHT OF WAY VARIES AT #4 REBAR. FOUND; THENCE ALONG THE NORTHERN RIGHT OF WAY OF EVANS TO LOCKS ROAD (C.R. #1236) RIGHT OF WAY VARIES NORTH 52 DEGREES 53 MINUTES 45 SECONDS EAST (N52°53'45"E), A DISTANCE OF 105.32 FEET TO A CONCRETE MONUMENT, FOUND BEING THE POINT OF BEGINNING: THENCE NORTH 49 DEGREES 46 MINUTES 47 SECONDS WEST (N 49°46'47"W), A DISTANCE OF 591.47 FEET TO A #4 REBAR FOUND; THENCE NORTH 02 DEGREES 47 MINUTES 54 SECONDS WEST (N02°47'54"W), A DISTANCE OF 363.25 FEET TO A #4 REBAR FOUND; THENCE NORTH 60 DEGREES 35 MINUTES 55 SECONDS EAST (N60°35'55"E), A DISTANCE OF 80.00 FEET TO A #4 REBAR SET; THENCE SOUTH 52 DEGREES 30 MINUTES 54 SECONDS EAST (S52°30'54"E), A DISTANCE OF 325.98 FEET TO A #4 REBAR SET; THENCE NORTH 60 DEGREES 35 MINUTES 55 SECONDS EAST (N60°35'55"E), A DISTANCE OF 200.04 FEET TO A #4 REBAR SET; THENCE SOUTH 37 DEGREES 12 MINUTES 13 SECONDS EAST (S37°12'13"E), A DISTANCE OF 521.47 FEET TO A #4 REBAR SET; THENCE ALONG THE NORTHERN RIGHT OF WAY OF EVANS TO LOCKS ROAD (C.R. #1236) RIGHT OF WAY VARIES SOUTH 52 DEGREES 23 MINUTES 38 SECONDS WEST (S52°23'38"W), A DISTANCE OF 440.00 FEET TO A CONCRETE MONUMENT FOUND, BEING THE POINT OF BEGINNING CONTAINING 7.99 ACRES, THIS BEING THE SAME PROPERTY AS SHOWN ON AN APPROVED SUBDIVISION PLAT RECORDED ON 08-14-12 IN PLAT CABINET "G" SLIDE 158 #1.

 

TOGETHER WITH THOSE EASEMENT RIGHTS ARISING UNDER THAT CERTAIN STORMWATER AND TEMPORARY CONSTRUCTION EASEMENT BY AND BETWEEN JOHN KENNETH DAVIDSON, SR. AND NFR CAMELLIA WALK REALTY, LLC, A GEORGIA LIMITED LIABILITY COMPANY, DATED NOVEMBER 14, 2012, FILED FOR RECORD NOVEMBER 16, 2012 AT 10:35 A.M., RECORDED IN DEED BOOK 8609, PAGE 83, RECORDS OF COLUMBIA COUNTY, GEORGIA.

 

  

EXHIBIT A-10

 

DESCRIPTION OF PROJECTS

  

Borrower:

ARHC PPDWTMI01, LLC

 

Name of Project:

Prestige Pines

 

Address of Project:

1177 Solon Road, Dewitt, Michigan 48820 (Clinton County)

 

Legal Description of Land:

 

Land Situated in the Township of DeWitt, County of Clinton, State of Michigan:

 

Beginning at the Northwest corner of the Northeast 1/4 of the Southeast 1/4 of Section 21, Town 5 North, Range 2 West, DeWitt Township, Clinton County, Michigan, running thence East 49.5 feet, thence South 198 feet; thence East 328 feet; thence South 460 feet; thence West 377.5 feet to the West line of the Northeast 1/4 of the Southeast 1/4 of Section 21; thence North 658 feet to the point of beginning.

 

Together with the perpetual right of ingress and egress over the following parcels or land as set forth in a Deed from Maas Acquisitions, LLC to Leisure Living Properties – Dewitt, L.L.C. dated December 1, 2004 and recorded with the Clinton County Recorder’s Office as Instrument Number 507921:

 

No. 1: Beginning at a point 658 feet South of the Northwest corner of the Northeast 1/4 of the Southeast 1/4 of Section 21, Town 5 North, Range 2 West, and running thence South 50 feet; thence East to U.S. Highway 27; thence North 50 feet; thence West to the place of beginning.

 

No. 2: Beginning at a point 198 feet South and 377.5 feet East of the Northwest corner of the Northeast 1/4 of the Southeast 1/4 of said Section 21, thence North of the center of Solon Road, thence West 50 feet; thence South 198 feet; thence East 50 feet to the point of beginning.

 

EXCEPT THE FOLLOWING: The North 90 feet of a parcel described as: Beginning at a point 41.50 feet East from the Northwest corner of the Northeast 1/4 of the Southeast 1/4 of Section 21, Town 5 North, Range 2 West, DeWitt Township, Clinton County, Michigan, at a point which is located on the center line of Solon Road, thence South 198 feet, thence East 8 feet, thence North 198 feet, thence West 8 feet to the point of beginning

 

 

EXHIBIT A-11

 

DESCRIPTION OF PROJECTS

 

Borrower:

ARHC PCCHEMI01, LLC

 

Name of Project:

Prestige Commons

 

Address of Project:

33503 23 Mile Road, New Baltimore, Michigan 48047 (Macomb County)

 

Legal Description of Land:

 

Land situated in the Township of Chesterfield, County of Macomb, Michigan, more particularly described as:

 

Part of the Southwest 1/4 of Section 14, Town 3 North, Range 14 East, Chesterfield Township, Macomb County, Michigan and being more particularly described as follows: Commencing at a point 1237.98 feet North 89 degrees 48 minutes 40 seconds East from the Southwest corner of said Section 14 to the Point of Beginning; thence extending North 00 degrees 20 minutes 40 seconds East 325.49 feet; thence North 80 degrees 59 minutes 20 seconds West 85.92 feet; thence North 01 degree 14 minutes 00 seconds East 206.22 feet; thence North 89 degrees 48 minutes 40 seconds East 208.00 feet; thence along the Salt River, South 47 degrees 35 minutes 59 seconds East 407.03 feet and South 01 degree 34 minutes 55 seconds East 270.00 feet to the South section line; thence South 89 degrees 48 minutes 40 seconds West 437.56 feet along said line to the Point of Beginning.

 

 

EXHIBIT A-12

 

DESCRIPTION OF PROJECTS

 

Borrower:

ARHC PCPLSMI01, LLC

 

Name of Project:

Prestige Centre

 

Address of Project:

5785 East Broadway Road, Mt Pleasant, Michigan (Isabella County)

 

Legal Description of Land:

 

Land Situated in the Township of Union, County of Isabella, State of Michigan:

 

Parcel 1

 

Part of the South 1/2 of the Northeast 1/4 of Section 13, Town 14 North, Range 4 West, Union Township, Isabella County, Michigan, described as: Beginning at a point on the East and West 1/4 line which is North 88 degrees 57 minutes 50 seconds West 961.0 feet from the East 1/4 corner of said Section 13; thence North 88 degrees 57 minutes 50 seconds West 389.0 feet; thence North 0 degrees 08 minutes East 250.0 feet; thence South 88 degrees 57 minutes 50 seconds East 386.69 feet; thence South 0 degrees 23 minutes 50 seconds East 250.0 feet to the point of beginning.

 

and

  

Parcel 2

 

Part of the Northeast 1/4 of Section 13, Town 14 North, Range 4 West, Township of Union, Isabella County, Michigan, more particularly described as: Beginning at a point on the East-West 1/4 line of said Section 13 which is North 88 degrees 57 minutes 50 seconds West, 695.00 feet from the East 1/4 corner of said Section 13; thence continuing along said 1/4 line, North 88 degrees 57 minutes 50 seconds West 266.00 feet; thence North 00 degrees 24 minutes 25 seconds West 250.00 feet; thence North 88 degrees 57 minutes 24 seconds West 386.64 feet (previously North 88 degrees 57 minutes 50 seconds West 386.69 feet); thence North 00 degrees 08 minutes 06 seconds East 205.00 feet; thence South 88 degrees 56 minutes 38 seconds East 330.91 feet; thence North 00 degrees 25 minutes 45 seconds West 55.85 feet; thence South 88 degrees 56 minutes 38 seconds East 319.90 feet; thence South 00 degrees 23 minutes 50 seconds East 510.71 feet to the point of beginning.

 

 

EXHIBIT A-13

 

DESCRIPTION OF PROJECTS

 

Borrower:

ARHC GOFENMI01, LLC

 

Name of Project:

Golden Orchards

 

Address of Project:

2464 55th Street, Fennville, Michigan 49408 (Allegan County)

 

Legal Description of Land:

 

Land situated in the Township of Manlius, County of Allegan, Michigan, more particularly described as:

 

PARCEL 1:

 

THE NORTH 1/2 OF THE NORTHWEST 1/4 OF THE SOUTHWEST 1/4, SECTION 33, T3N, R15W, EXCEPT ANY PORTION THEREOF OWNED BY THE C&O RAILROAD AND ALL LANDS LYING NORTHWESTERLY OF THE C&O RAILROAD; IN MANLIUS TOWNSHIP, COUNTY OF ALLEGAN, STATE OF MICHIGAN.

 

PARCEL 2:

 

THE SOUTH 1/2 OF THE NORTH 1/2 OF THE NORTHEAST 1/4 OF THE SOUTHWEST 1/4 OF SECTION 33, T3N, R15W; IN MANLIUS TOWNSHIP, COUNTY OF ALLEGAN, STATE OF MICHIGAN.

 

PARCEL 3:

 

THAT PART OF SECTION 33, T3N, R15W, DESCRIBED AS BEGINNING ON THE NORTH AND SOUTH 1/4 AT A POINT 330.33 FEET NORTH 01 DEGREE 44 MINUTES 03 SECONDS EAST OF THE EAST 1/8 POST OF THE SOUTHWEST 1/4; THENCE NORTH 88 DEGREES 10 MINUTES 57 SECONDS WEST 1327.04 FEET TO THE NORTH AND SOUTH 1/4 LINE OF THE SOUTHWEST 1/4; THENCE NORTH 01 DEGREE 37 MINUTES 23 SECONDS EAST ON SAID 1/8 LINE 332.03 FEET; THENCE SOUTH 87 DEGREES 57 MINUTES 19 SECONDS EAST 1327.69 FEET TO THE NORTH AND SOUTH 1/4 LINE; THENCE SOUTH 01 DEGREE 44 MINUTES 03 SECONDS WEST ON SAID 1/4 LINE 330.03 FEET TO THE POINT OF BEGINNING; IN MANLIUS TOWNSHIP, COUNTY OF ALLEGAN, STATE OF MICHIGAN.

 

 

PARCEL 4:

 

THE SOUTH 1/2 OF THE SOUTH 1/2 OF THE NORTHEAST 1/4 OF THE SOUTHWEST 1/4 OF SECTION 33, T3N, R15W, IN MANLIUS TOWNSHIP, COUNTY OF ALLEGAN, STATE OF MICHIGAN.

 

SAID PARCELS ALSO DESCRIBED AS:

 

PART OF THE SOUTHWEST 1/4 OF SECTION 33, T3N, R15W, MANLIUS TOWNSHIP, ALLEGAN COUNTY, MICHIGAN, BEING DESCRIBED AS: COMMENCING AT THE WEST 1/4 CORNER OF SAID SECTION, THENCE SOUTH 00 DEGREES 00 MINUTES 00 SECONDS WEST 542.19 FEET ALONG THE WEST LINE OF SAID SECTION TO THE POINT OF BEGINNING OF THE PARCEL OF LAND HEREIN DESCRIBED; THENCE NORTH 48 DEGREES 23 MINUTES 36 SECONDS EAST 480.46 FEET ALONG THE SOUTHEASTERLY LINE OF THE C & O RAILROAD; THENCE NORTHWESTERLY 306.34 FEET ALONG THE SOUTHEASTERLY LINE OF THE C&O RAILROAD AND THE ARC OF A 2360.08 FOOT RADIUS CURVE TO THE LEFT THROUGH A CENTRAL ANGLE OF 07 DEGREES 26' 13" AND A CHORD BEARING NORTH 44 DEGREES 40 MINUTES 29 SECONDS EAST 306.12 FEET; THENCE SOUTH 89 DEGREES 27 MINUTES 13 SECONDS EAST 754.13 FEET ALONG THE EAST AND WEST 1/4 LINE OF SAID SECTION; THENCE SOUTH 00 DEGREES 05 MINUTES 36 SECONDS WEST 332.13 FEET ALONG THE EAST LINE OF THE NORTHWEST 1/4 OF THE SOUTHWEST 14 OF SAID SECTION; THENCE SOUTH 89 DEGREES 32' 45" EAST 1328.07 FEET ALONG THE NORTH LINE OF THE SOUTH 1/2 OF THE NORTH 1/2 OF THE NORTHEAST 1/4 OF THE SOUTHWEST 1/4 OF SAID SECTION; THENCE SOUTH 00 DEGREES 11 MINUTES 17 SECONDS WEST 989.97 FEET ALONG THE NORTH AND SOUTH 1/4 LINE OF SAID SECTION; THENCE NORTH 89 DEGREES 49 MINUTES 21 SECONDS WEST 1326.41 FEET ALONG THE SOUTH LINE OF THE NORTHEAST 1/4 OF THE SOUTHWEST 1/4 OF SAID SECTION; THENCE NORTH 00 DEGREES 05 MINUTES 36 SECONDS EAST 664.26 FEET ALONG THE WEST LINE OF THE NORTHEAST 1/4 OF THE SOUTHWEST 1/4 OF SAID SECTION; THENCE NORTH 89 DEGREES 38 MINUTES 16 SECONDS WEST 1327.52 FEET ALONG THE SOUTH LINE OF THE NORTH 1/2 OF

 

THE NORTHWEST 1/4 OF THE SOUTHWEST 1/4 OF SAID SECTION; THENCE NORTH 00 DEGREES 00 MINUTES 00 SECONDS EAST 126.34 FEET ALONG WEST LINE OF SAID SECTION TO THE POINT OF BEGINNING; IN MANLIUS TOWNSHIP, COUNTY OF ALLEGAN, STATE OF MICHIGAN.

 

 

EXHIBIT A-14

 

DESCRIPTION OF PROJECTS

 

Borrower:

ARHC CSKENMI01, LLC

 

Name of Project:

Crystal Springs

 

Address of Project:

1171 68th Street SE, Kentwood, Michigan 49508 (Kent County)

 

Legal Description of Land:

 

Land situated in the Township of Gaines, County of Kent, Michigan, more particularly described as:

 

That part of the SW 1/4, Section 5, T5N, R11W, Gaines Township, Kent County, Michigan, described as; Beginning at a point on the South line of said SW 1/4, which is S 89 degrees 02 minutes 13 seconds W 170.00 feet from the S 1/4 corner of said Section 5; thence S 89 degrees 02 minutes 13 seconds W 161.84 feet along said South line; thence N 00 degrees 32 minutes 51 seconds W 1670.00 feet along the West line of the E 1/8 of said SW 1/4; thence N 70 degrees 38 minutes 20 seconds E 348.56 feet; thence S 00 degrees 36 minutes 31 seconds E 1540.00 feet along the East line of said SW 1/4; thence S 89 degrees 02 minutes 13 seconds W 170.00 feet; thence S 00 degrees 36 minutes 31 seconds E 240.00 feet to the place of beginning.

 

 

EXHIBIT A-15

 

DESCRIPTION OF PROJECTS

  

Borrower:

ARHC SMMDSIA01, LLC

 

Name of Project:

Sunnybrook of Ft. Madison

 

Address of Project:

5025 River Valley Road, Fort Madison, Iowa 52627 (Lee County)

 

Legal Description of Land:

 

Lot 2 of River Bend Subdivision, Fort Madison, Lee County, Iowa, part of the East Half of Section 1, Township 67 North, Range 5 West of the 5th Principal Meridian, Lee County, Iowa.

 

 

EXHIBIT A-16

 

DESCRIPTION OF PROJECTS

 

Borrower:

ARHC SFFLDIA01, LLC

 

Name of Project:

Sunnybrook of Fairfield

 

Address of Project:

3000 W. Madison Avenue, Fairfield, Iowa 52556 (Jefferson County)

 

Legal Description of Land:

 

That part of Auditor's Parcel "C" in part of the Northeast Quarter of the Northwest Quarter of Section 34, Township 72, Range 10, Jefferson County, Iowa, described as follows:

 

Commencing at the Northeast corner of said Northwest Quarter of Section 34; thence South 89 degrees 41 minutes 21 seconds West, along the North line of said Northwest Quarter of Section 34 and the centerline of the existing street, 644.00 feet; thence South 00 degrees 00 minutes 00 seconds West, 33.00 feet to the POINT OF BEGINNING; thence continuing South 00 degrees 00 minutes 00 seconds West, 461.44 feet; thence North 89 degrees 41 minutes 21 seconds East, 472.00 feet; thence North 00 degrees 00 minutes 00 seconds West, 461.44 feet; thence South 89 degrees 41 minutes 21 seconds West, along the South line of West Madison Avenue, 472.00 feet to the POINT OF BEGINNING.

 

 

EXHIBIT A-17

 

DESCRIPTION OF PROJECTS

 

Borrower:

ARHC ALALPGA01, LLC

 

Name of Project:

Addington Place of Alpharetta

 

Address of Project:

762 N. Main Street, Alpharetta, Georgia 30009 (Fulton County)

 

Legal Description of Land:

 

ALL THAT TRACT OR PARCEL OF LAND LYING AND BEING IN LAND LOT 1111 OF THE 2ND DISTRICT, 2ND SECTION, FULTON COUNTY, GEORGIA, AND BEING MORE PARTICULARLY DESCRIBED AS FOLLOWS:

 

COMMENCING AT A CONCRETE RIGHT OF WAY MONUMENT, SAID MONUMENT BEING LOCATED AT THE INTERSECTION OF THE NORTHERLY RIGHT-OF-WAY OF STATE HIGHWAY NO. 9, A/K/A US HIGHWAY 19 (VARIABLE RIGHT-OF-WAY) AND THE EASTERLY RIGHT-OF-WAY OF COGBURN ROAD (VARIABLE RIGHT-OF-WAY) SAID MONUMENT BEING THE TRUE POINT OF BEGINNING;

 

THENCE PROCEEDING NORTH ALONG THE EASTERLY RIGHT-OF-WAY OF COGBURN ROAD, NORTH 01° 24' 23" EAST 139.80 FEET TO A POINT; THENCE NORTH 01° 30' 43" EAST 148.35 FEET TO A POINT; THENCE NORTH 02° 27' 38" EAST 61.71 FEET TO A POINT; THENCE DEPARTING SAID COGBURN ROAD RIGHT-OF-WAY SOUTH 89° 14' 02" EAST 568.63 FEET TO A POINT; THENCE SOUTH 00° 30' 22" EAST 368.68 FEET TO A POINT ON NORTHERLY RIGHT-OF-WAY LINE OF STATE HIGHWAY NO. 9; THENCE ALONG SAID RIGHT-OF-WAY OF STATE HIGHWAY NO. 9 NORTH 89° 15' 06" WEST 332.33 FEET TO POINT; THENCE NORTH 00° 56' 57" EAST 5.39 FEET TO A POINT; THENCE SOUTH 89° 04' 07" WEST 24.00 FEET TO A POINT; THENCE SOUTH 00° 55' 53" WEST 5.50 FEET TO A POINT; THENCE NORTH 89° 20' 58" WEST 200.56 FEET TO A CONCRETE RIGHT OF WAY MONUMENT; THENCE NORTH 50° 42' 27" WEST 32.28 FEET TO THE TRUE POINT OF BEGINNING.

 

 

EXHIBIT A-18

 

DESCRIPTION OF PROJECTS

 

Borrower:

ARHC PSINDIA01, LLC

 

Name of Project:

Prairie Hills at Independence

 

Address of Project:

505 Enterprise Drive SW, Independence, Iowa 50644 (Polk County)

 

Legal Description of Land:

 

All Condominium Units in Prairie Hills at Independence, a Condominium according to the Declaration thereof recorded as File No. 2008R04449, Records of the Buchanan County Recorder, Prairie Hills at Independence as presently constituted, is located on Lots 1 and 2, Enterprise First Addition to Independence, Buchanan County, Iowa.

 

Together with rights contained in Declaration of Submission of Property to Horizontal Property Regime, dated December 19, 2008, filed December 30, 2008, as Document No. 2008R04449.

 

 

EXHIBIT A-19

 

DESCRIPTION OF PROJECTS

 

Borrower:

ARHC BWBRUGA01, LLC

 

Name of Project:

Addington Place of Brunswick

 

Address of Project:

890 Scranton Road, Brunswick, Georgia 31525 (Glynn County)

 

Legal Description of Land:

 

ALL OF THAT LOT, PARCEL OR TRACT OF LAND LYING AND BEING IN THE 26TH GEORGIA MILITIA DISTRICT, GLYNN COUNTY, GEORGIA BEING A PORTION OF BLOCK “G”, GLYNN PLACE COMMERCIAL PARK, AND IS MORE PARTICULARLY DESCRIBED AS FOLLOWS:

 

BEGINNING AT AN IRON REBAR FOUND AT THE INTERSECTION OF THE EASTERLY RIGHT OF WAY LINE OF SCRANTON ROAD (100’ RIGHT OF WAY) AND THE SOUTHERLY RIGHT OF WAY LINE OF CHAPEL CROSSING ROAD (100’ RIGHT OF WAY); THENCE ALONG SAID CHAPEL CROSSING ROAD RIGHT OF WAY N 88°58’32” E A DISTANCE OF 457.43’ TO A CAPPED IRON REBAR FOUND; THENCE LEAVE SAID RIGHT OF WAY LINE AND PROCEED WITH THE FOLLOWING COURSES AND DISTANCES; THENCE S 01°01’28” E A DISTANCE OF 154.08’ TO A CAPPED IRON REBAR FOUND; THENCE S 32°05’21” W A DISTANCE OF 700.95’ TO A CAPPED IRON REBAR FOUND; THENCE N 57°54’11” W A DISTANCE OF 537.32’ TO AN IRON REBAR ON THE EASTERLY RIGHT OF WAY LINE OF SCRANTON ROAD; THENCE ALONG SAID RIGHT OF WAY LINE N 32°05’21” E A DISTANCE OF 440.04’ TO AN IRON REBAR FOUND; THENCE N 58°39’29” E A DISTANCE OF 156.53’ TO THE POINT OF BEGINNING.

 

TOGETHER WITH THOSE EASEMENT RIGHTS ARISING UNDER CERTAIN STORMWATER DRAINAGE AND UTILITY EASEMENT AGREEMENT BY AND BETWEEN THOMAS & BRYSON PROPERTIES, LLC, A GEORGIA LIMITED LIABILITY COMPANY AND BRUNSWICK SLP LLC, A GEORGIA LIMITED LIABILITY COMPANY, DATED AS OF FEBRUARY 20, 2012, FILED FOR RECORD FEBRUARY 22, 2012, AT 10:18 A.M., RECORDED IN DEED BOOK 2963, PAGE 446, RECORDS OF GLYNN COUNTY, GEORGIA WITH RESPECT TO THE FOLLOWING EASEMENTS:

 

30’ DRAINAGE EASEMENT

 

ALL OF THAT 30’ DRAINAGE EASEMENT LYING AND BEING IN THE 26TH GEORGIA MILITIA DISTRICT, GLYNN COUNTY, GEORGIA BEING A PORTION OF BLOCK “G”, GLYNN PLACE COMMERCIAL PARK, AND BEING MORE PARTICULARLY DESCRIBED AS FOLLOWS:

 

  

COMMENCING AT AN IRON REBAR FOUND AT THE INTERSECTION OF THE EASTERLY RIGHT OF WAY LINE OF SCRANTON ROAD AND THE SOUTHERLY RIGHT OF WAY LINE OF CHAPEL CROSSING ROAD; THENCE ALONG SAID CHAPEL CROSSING ROAD RIGHT OF WAY N 88°58’32” E A DISTANCE OF 457.43’ TO A POINT; THENCE LEAVE SAID RIGHT OF WAY LINE AND PROCEED S 01°01’28” E A DISTANCE OF 154.08” TO A POINT; THENCE S 32°05’21” W A DISTANCE OF 100.80’ TO THE POINT OF BEGINNING; THENCE S 57°34’43” E A DISTANCE OF 395.36’ TO A POINT; THENCE S 32°05’21” W A DISTANCE OF 30.00’ TO A POINT; THENCE N 57°34’43” W A DISTANCE OF 395.36’ TO A POINT; THENCE N 32°05’21” E A DISTANCE OF 30.00’ TO THE POINT OF BEGINNING.

  

20’ UTILITY EASEMENT

 

ALL OF THAT LOT, PARCEL OR TRACT OF LAND LYING AND BEING IN THE 26TH GEORGIA MILITIA DISTRICT, GLYNN COUNTY, GEORGIA BEING A PORTION OF BLOCK “G”, GLYNN PLACE COMMERCIAL PARK, AND BEING MORE PARTICULARLY DESCRIBED AS FOLLOWS:

 

COMMENCING AT AN IRON REBAR FOUND AT THE INTERSECTION OF THE EASTERLY RIGHT OF WAY LINE OF SCRANTON ROAD AND THE SOUTHERLY RIGHT OF WAY LINE OF CHAPEL CROSSING ROAD; THENCE ALONG SAID SCRANTON ROAD RIGHT OF WAY S 58°39’29” W A DISTANCE OF 156.53’ TO A POINT; THENCE S 32°05’21” W A DISTANCE OF 440.04’ TO A POINT; THENCE LEAVE SAID RIGHT OF WAY LINE AND PROCEED S 57°54’11” E A DISTANCE OF 537.32’ TO THE POINT OF BEGINNING; THENCE N 32°05’21” E A DISTANCE OF 20.00’ TO A POINT; THENCE S 57°54’11” E A DISTANCE OF 304.60’ TO A POINT; THENCE S 01°04’37” E A DISTANCE OF 528.66’ TO A POINT; THENCE S 57°52’07” E A DISTANCE OF 40.83’ TO A POINT; THENCE S 57°45’01” E A DISTANCE OF 159.88’ TO A POINT; THENCE S 32°06’13” W A DISTANCE OF 335.90’ TO A POINT ON THE NORTHERLY RIGHT OF WAY LINE OF SCRANTON CONNECTOR; THENCE ALONG SAID RIGHT OF WAY LINE N 55°50’07” W A DISTANCE OF 20.01’ TO A POINT; THENCE LEAVE SAID RIGHT OF WAY LINE AND PROCEED N 32°06’13” E A DISTANCE OF 315.23’ TO A POINT; THENCE N 57°45’01” W A DISTANCE OF 139.91’ TO A POINT; THENCE N 57°52’07” W A DISTANCE OF 51.62’ TO A POINT; THENCE N 01°04’37” W A DISTANCE OF 528.65’ TO A POINT; THENCE N 57°54’11” W A DISTANCE OF 293.78’ TO THE POINT OF BEGINNING.

 

 

EXHIBIT A-20

 

DESCRIPTION OF PROJECTS

 

Borrower:

ARHC DBDUBGA01, LLC

 

Name of Project:

Addington Place of Dublin

 

Address of Project:

212 Fairview Park Drive, Dublin, Georgia 31021 (Laurens County)

 

Legal Description of Land:

 

ALL THAT TRACT OF LAND IN THE LAND LOT 130 OF THE FIRST LAND DISTRICT OF LAURENS COUNTY, GEORGIA, CONTAINING 4.60 ACRES, AND BEING PARTICULARLY DESCRIBED AS FOLLOWS: BEGINNING AT AN IRON PIN AT THE POINT OF BEGINNING THENCE SOUTHEASTERLY 61 DEGREES 56 MINUTES 10 SECONDS 423.13 FEET TO A STEEL REBAR; THENCE SOUTHWESTERLY 45 DEGREES 05 MINUTES 37 SECONDS 559.23 FEET TO A STEEL REBAR; THENCE NORTHWESTERLY 44 DEGREES 18 MINUTES 44 SECONDS 404.60 FEET TO A STEEL REBAR; THENCE NORTHEASTERLY 45 DEGREES 05 MINUTES 37 SECONDS 431.11 FEET TO THE POINT OF BEGINNING. SAID TRACT IS BOUNDED, NOW OR FORMERLY, ON THE EAST BY PROPERTY OF MOORE STATION DEVELOPMENT, L.L.C.; SOUTH BY PROPERTY OF THOMAS R. PERRY; WEST BY PROPERTY OF THREE J. INVESTMENTS AND NORTH BY PROPERTY OF MOORE STATION DEVELOPMENT, L.L.C.

 

TOGETHER WITH RIGHTS CONTAINED IN RIGHT-OF-WAY DEED FROM MOORE STATION DEVELOPMENT CO., LLC, TO CITY OF DUBLIN, DATED MARCH 27, 2008, AND RECORDED IN BOOK 1998, PAGE 284, AND EASEMENT FROM MOORE STATION DEVELOPMENT CO. LLC, TO DUBLIN SENIOR LIVING PARTNERS, LLC RECORDED MAY 16, 2008, IN DEED BOOK 2014, PAGE 23.

 

SAID TRACT PARTICULARLY SHOWN ON A PLAT OF SURVEY FOR EMPIRE FINANCIAL SERVICES, INC. BY LARRY C. JONES, LAND SURVEYOR, DATED MARCH 21, 2008, AND RECORDED IN PLAT BOOK 9, PAGE 388A, LAURENS COUNTY RECORDS, WHICH PLAT IS BY THIS REFERENCE INCORPORATED.

 

ALSO BEING DESCRIBED AS FOLLOWS:

 

ALL THAT CERTAIN PARCEL OF LAND LYING AND BEING IN THE LAND LOT 130OF THE 1^ST LAND DISTRICT OF LAURENS COUNTY, GEORGIA.

 

 

TO FIND THE TRUE POINT OF BEGINNING, COMMENCE AT A POINT 2,298.67 FEET SOUTHWESTERLY FROM THE INSTERSECTION OF THE SOUTHWESTERLY RIGHT OF WAY OF INDUSTRIAL BOULEVARD, WITH THE NORTHEASTERLY RIGHT OF WAY OF FAIRVIEW PARK DRIVE (50’ PUBLIC RIGHT OF WAY); THENCE LEAVING SAID RIGHT OF WAY NORTH 45° 39’ 51” WEST FOR A DISTANCE OF 203.99 FEET TO A 5/8 INCH IRON ROD FOUND; THENCE SOUTH 45° 05’ 37” WEST FOR A DISTANCE OF 212.84 FEET TO A ½ INCH IRON PIPE AND THE TRUE POINT OF BEGINNING.

 

FROM THE TRUE POINT OF BEGINNING AS THUS ESTABLISHED THENCE PROCEED SOUTH 61° 55’ 41” EAST FOR A DISTANCE OF 423.12 FEET TO A ½ “ IRON PIPE FOUND; THENCE, SOUTH 45° 05’ 37” WEST, FOR A DISTANCE OF 559.25 FEET TO A 1/2” IRON PIPE FOUND; THENCE NORTH 44° 19’ 21” WEST, FOR A DISTANCE OF 404.50 FEET TO A 5/8 IRON ROD FOUND; THENCE NORTH 45° 04’ 46” EAST, FOR A DISTANCE OF 431.26 FEET TO A ½” IRON PIPE AND THE TRUE POINT OF BEGINNING.

 

 

EXHIBIT A-21

 

DESCRIPTION OF PROJECTS

 

Borrower:

ARHC PHTIPIA01, LLC

 

Name of Project:

Prairie Hills at Tipton

 

Address of Project:

219 S. Cedar Street, Tipton, Iowa 52772 (Cedar County)

 

Legal Description of Land:

 

Units 201 through 213, 301 through 320, 401 through 413; All in Prairie Hills at Tipton Condominiums, a Condominium in the City of Tipton, Iowa, together with appurtenances thereto including an undivided fractional interest in the common elements, areas and facilities as determined for said unit by the provisions of, and in accordance with, the Declaration of Submission of Property to Horizontal Property Regime for Prairie Hills at Tipton Condominiums, filed in the office of the Recorder of Cedar County, Iowa on September 24, 2012 in Book 1132 at Page 1/Document No. 2012 3782 (and any supplements and amendments thereto). Prairie Hills at Tipton Condominiums, as presently constituted, is located on Auditor's Parcel "L" is a part of the Northwest Quarter (NW 1/4) of the Southwest Quarter (SW 1/4) Section Six (6), Township Eighty (80) North, Range Two (02) West of the Fifth (5th) Principal Meridian (P.M.) in the City of Tipton, Cedar County, Iowa and is more particularly described as follows: Commencing at the Southwest corner of said NW 1/4 of the SW 1/4 Section 6; thence South 89°55'41" East 515.18 feet along the South line of said NW 1/4 of the SW 1/4; thence North 0° 47'31" West 213.00 feet to the Point of Beginning for this description; thence continuing North 0°47'31" West 484.24 feet to the Southeast line of Lot 3 of the "City of Tipton Industrial Park"; thence North 34° 00'14" East 79.25 feet along the Southeast side of said Lot 3; thence South 89° 55' 41" East 569.91 feet to the centerline of Cedar Street (also known as Iowa Highway No. 38); thence South 00°48'24" East 550.00 feet along said centerline; thence North 89°55'41" West 615.28 feet to the Point of Beginning. The West line of the Southwest Quarter (SW 1/4) of Section Six (6) is North 0°00'00" East for purpose of this description.

 

 

EXHIBIT A-22

 

DESCRIPTION OF PROJECTS

 

Borrower:

ARHC OPBROOR01, LLC

 

Name of Project:

Ocean Park Memory Care

 

Address of Project:

984 Parkview Drive, Brookings, Oregon 97415 (Curry County)

 

Legal Description of Land:

 

A tract of land lying in the Southwest Quarter of Section 31, Township 40 South, Range 13 West, Willamette Meridian, Curry County, Oregon, described as follows:

 

Beginning at the Southwest corner of said Section 31;

Thence North along the West line of said Section 200.1 feet

Thence East 104.0 feet;

Thence North 422.9 feet;

Thence North 89°53’ East, 733.3 feet;

Thence East 35.0 feet;

Thence North 22°04’ East 178.7 feet;

Thence North 45°24’ East 144.8 feet;

Thence North 18° 34’ East 198.2 feet;

Thence North 41°37’ East 335.2 feet;

Thence South 0°58’ East 656.0 feet;

Thence South 43°41’ West 154.8 feet;

Thence South 25°25’ West 118.9 feet;

Thence South 29°08’West 103.4 feet;

Thence South 58°18’ West 171.6 feet;

Thence South 26°26’ West 235.0 feet to an iron pipe;

Thence North 89°45’15” West 291.6 feet;

Thence South 0°58’ West 105.7 feet to an iron pipe on the South line of said Section 31;

Thence West along said South line 546.1 feet to the Point of Beginning.

 

TOGETHER with an easement for roadway and utility purposes and for egress, ingress and access to the above described property over a strip of land 40.0 feet in width, the centerline of which commences on the Northerly line of Ransom Avenue in the City of Brookings, Oregon; thence North in a straight line, parallel to and 426.1 feet East of the West line of Section 6 to the South line of said Section 31.

 

ALSO TOGETHER with a perpetual non-exclusive easement for roadway and utility purposes, 20.0 feet in width, over, across and under the Westerly 20.0 feet of the property described in Volume 70, Page 61, Curry County Book of Records.

 

 

 ALSO TOGETHER with rights, if any as set forth in a Deed from Frank McMillan and Eleanor C. McMillan to Henry L. Kerr and Adeline Kerr dated July 8, 1958 and recorded in Volume 53, Page 310, Curry County Book of Records.

 

 

EXHIBIT A-23

 

DESCRIPTION OF PROJECTS

 

Borrower:

ARHC ALELIKY01, LLC

 

Name of Project:

Allegro at Helmwood

 

Address of Project:

108 Diecks Drive, Elizabethtown, Kentucky 42701 (Hardin County)

 

Legal Description of Land:

 

Parcel 1

 

Lot 1, Westminister Terrace Subdivision, Amended Record Plat of Governors Manor Shopping Center, Lots 13, 14 and 1-B and Governors Drive, a plat of which is recorded in Plat Cabinet 1, Sheet 963, Amended from Sheet 617, in the Office of the Clerk of Hardin County, Kentucky.

 

Together with a nonexclusive easement for ingress and egress as set forth in the Mutual Grant Easement by and between Helmwood Village I, LTD., and Helmwood Village II Associates, dated May 19, 1988 and recorded in Deed Book 628, Page 451 in the Office of the Clerk of Hardin County, Kentucky.

 

PARCEL NO. 202-30-05-026

 

 

EXHIBIT B

 

	Facility		Borrower
1.	Lakeside Vista		ARHC LVHLDMI01, LLC
2.	Buchanan Meadows		ARHC BMBUCMI01, LLC
3.	Sunnybrook of Mt. Pleasant		ARHC SPPLSIA01, LLC
4.	Prairie Hills at Ottumwa		ARHC PHOTTIA01, LLC
5.	Sunnybrook of Carroll		ARHC SCCRLIA01, LLC
6.	Prairie Hills at Clinton		ARHC PHCTNIA01, LLC
7.	Addington Place of Titusville		ARHC TVTITFL01, LLC
8.	Sunnybrook of Muscatine		ARHC SMMTEIA01, LLC
9.	Camelia Walk Assisted Living and Memory Care		ARHC CWEVAGA01, LLC
10.	Prestige Pines		ARHC PPDWTMI01, LLC
11.	Prestige Commons		ARHC PCCHEMI01, LLC
12.	Prestige Centre		ARHC PCPLSMI01, LLC
13.	Golden Orchards		ARHC GOFENMI01, LLC
14.	Crystal Springs		ARHC CSKENMI01, LLC
15.	Sunnybrook of Ft. Madison		ARHC SMMDSIA01, LLC
16.	Sunnybrook of Fairfield		ARHC SFFLDIA01, LLC
17.	Addington Place of Alpharetta		ARHC ALALPGA01, LLC
18.	Prairie Hills at Independence		ARHC PSINDIA01, LLC
19.	Addington Place of Brunswick		ARHC BWBRUGA01, LLC
20.	Addington Place of Dublin		ARHC DBDUBGA01, LLC
21.	Prairie Hills at Tipton		ARHC PHTIPIA01, LLC
22.	Ocean Park Memory Care		ARHC OPBROOR01, LLC
23.	Allegro at Helmwood		ARHC ALELIKY01, LLC

 

  

EXHIBIT C

 

Form Of Assignment and Assumption

 

This Assignment and Assumption (this “Assignment and Assumption”) is dated as of the Effective Date set forth below and is entered into by and between [the][each]¹ Assignor identified in item 1 below ([the][each, an] “Assignor”) and [the][each]² Assignee identified in item 2 below ([the][each, an] “Assignee”). [It is understood and agreed that the rights and obligations of [the Assignors] [and] [the Assignees]³ hereunder are several and not joint.]⁴ Capitalized terms used but not defined herein shall have the meanings given to them in the Loan Agreement identified below (the “Loan Agreement”), receipt of a copy of which is hereby acknowledged by [the][each] Assignee. The Standard Terms and Conditions set forth in Annex 1 attached hereto are hereby agreed to and incorporated herein by reference and made a part of this Assignment and Assumption as if set forth herein in full.

 

For an agreed consideration, [the][each] Assignor hereby irrevocably sells and assigns to [the Assignee][the respective Assignees], and [the][each] Assignee hereby irrevocably purchases and assumes from [the Assignor][the respective Assignors], subject to and in accordance with the Standard Terms and Conditions and the Loan Agreement, as of the Effective Date inserted by the Administrative Agent as contemplated below (i) all of [the Assignor’s][the respective Assignors’] rights and obligations in [its capacity as a Lender][their respective capacities as Lenders] under the Loan Agreement and any other documents or instruments delivered pursuant thereto to the extent related to the amount and percentage interest identified below of all of such outstanding rights and obligations of [the Assignor][the respective Assignors] under the respective facilities identified below and (ii) to the extent permitted to be assigned under applicable law, all claims, suits, causes of action and any other right of [the Assignor (in its capacity as a Lender)][the respective Assignors (in their respective capacities as Lenders)] against any Person, whether known or unknown, arising under or in connection with the Loan Agreement, any other documents or instruments delivered pursuant thereto or the loan transactions governed thereby or in any way based on or related to any of the foregoing, including, but not limited to, contract claims, tort claims, malpractice claims, statutory claims and all other claims at law or in equity related to the rights and obligations sold and assigned pursuant to clause (i) above (the rights and obligations sold and assigned by [the][any] Assignor to [the][any] Assignee pursuant to clauses (i) and (ii) above being referred to herein collectively as [the][an] “Assigned Interest”). Each such sale and assignment is without recourse to [the][any] Assignor and, except as expressly provided in this Assignment and Assumption, without representation or warranty by [the][any] Assignor.

 

1

For bracketed language here and elsewhere in this form relating to the Assignor(s), if the assignment is from a single Assignor, choose the first bracketed language. If the assignment is from multiple Assignors, choose the second bracketed language.

2

For bracketed language here and elsewhere in this form relating to the Assignee(s), if the assignment is from a single Assignee, choose the first bracketed language. If the assignment is to multiple Assignees, choose the second bracketed language.

3

Select as appropriate.

4

Include bracketed language if there are multiple Assignors or multiple Assignees.

 

 

	1.	Assignor[s]:
	2.	Assignee[s]:
			[for each Assignee, indicate [Affiliate]
			[Approved Fund] of [identify Lender]]
	3.	Borrowers:	See Exhibit B to Loan Agreement
	4.	Administrative Agent:	Capital One, National Association
	5.	Loan Agreement:	Loan Agreement, dated as of December 28, 2017, among the Borrowers, the lending institutions party thereto from time to time, and Administrative Agent.

 

FACILITY ASSIGNED		AGGREGATE AMOUNT OF LOAN FOR ALL LENDERS		AMOUNT OF LOAN ASSIGNED		PERCENTAGE ASSIGNED OF LOAN
Funding Amount		$		$		%

 

1.

Trade Date:                            ______________5

 

2.              Effective Date: _____________ ___, 20___ [TO BE INSERTED BY AGENT AND WHICH SHALL BE THE EFFECTIVE DATE OF RECORDATION OF TRANSFER IN THE REGISTER THEREFOR.]

 

[THE REMAINDER OF THIS PAGE WAS INTENTIONALLY LEFT BLANK]

 

5

To be completed if the Assignor(s) and the Assignee(s) intend that the minimum assignment amount is to be determined as of the Trade Date.

 

 

The terms set forth in this Assignment Agreement are hereby agreed to:

 

	ASSIGNOR
	[NAME OF ASSIGNOR]
	By:
	Name:
	Title:
	ASSIGNEE
	[NAME OF ASSIGNEE]
	By:
	Name:
	Title:

 

 

[Consented to and]6 Accepted:
CAPITAL ONE, NATIONAL ASSOCIATION,
as Agent
By:
Name:
Title:
[Consented to by]7:
[_____________________],
as Borrower Representative
By:
Name:
Title:

 

6

To be added only if the consent of the Agent is required by the terms of the Loan Agreement.

 

7

To be added only if the consent of the Borrower Representative is required by the terms of the Loan Agreement.

  

 

ANNEX 1

Loan Agreement

dated as of _____________,

by and among

________________, and its subsidiaries

which are borrowers thereunder,

the financial institutions from time to time party thereto,

and

Capital One, National Association, as agent

 

STANDARD TERMS AND CONDITIONS FOR

ASSIGNMENT AND ASSUMPTION

 

1.

Representations and Warranties.

 

1.1       Assignors. The Assignor (a) represents and warrants that (i) it is the legal and beneficial owner of the Assigned Interest, (ii) the Assigned Interest is free and clear of any lien, encumbrance or other adverse claim, (iii) it has full power and authority, and has taken all action necessary, to execute and deliver this Assignment and Assumption and to consummate the transactions contemplated hereby and (iv) it is not a Defaulting Lender; and (b) assumes no responsibility with respect to (i) any statements, warranties or representations made in or in connection with the Loan Agreement or any other Loan Document, (ii) the execution, legality, validity, enforceability, genuineness, sufficiency or value of the Loan Documents or any collateral thereunder, (iii) the financial condition of the Parent, any of its Subsidiaries or Affiliates or any other Person obligated in respect of any Loan Document, or (iv) the performance or observance by Borrower, any of its Subsidiaries or Affiliates or any other Person of any of their respective obligations under any Loan Document.

 

1.2       Assignees. The Assignee (a) represents and warrants that (i) it has full power and authority, and has taken all action necessary, to execute and deliver this Assignment and Assumption and to consummate the transactions contemplated hereby and to become a Lender under the Loan Agreement, (ii) it meets all the requirements to be an assignee under Section 11.3 of the Loan Agreement (subject to such consents, if any, as may be required under Section 11.3 of the Loan Agreement), (iii) from and after the Effective Date, it shall be bound by the provisions of the Loan Agreement as a Lender thereunder and, to the extent of the Assigned Interest, shall have the obligations of a Lender thereunder, (iv) it is sophisticated with respect to decisions to acquire assets of the type represented by the Assigned Interest and either it, or the Person exercising discretion in making its decision to acquire the Assigned Interest, is experienced in acquiring assets of such type, (v) it has received a copy of the Loan Agreement, and has received or has been accorded the opportunity to receive copies of the most recent financial statements delivered pursuant to Section 6 thereof, as applicable, and such other documents and information as it deems appropriate to make its own credit analysis and decision to enter into this Assignment Agreement and to purchase the Assigned Interest, (vi) it has, independently and without reliance upon the Agent or any other Lender and based on such documents and information as it has deemed appropriate, made its own credit analysis and decision to enter into this Assignment and Assumption and to purchase the Assigned Interest, (vii) if it is a Foreign Lender, attached to the Assignment and Assumption is any documentation required to be delivered by it pursuant to the terms of the Loan Agreement, duly completed and executed by the Assignee, and (viii) [reserved]; and (b) agrees that (i) it will, independently and without reliance on the Agent, the Assignor or any other Lender, and based on such documents and information as it shall deem appropriate at the time, continue to make its own credit decisions in taking or not taking action under the Loan Documents, (ii) it will perform in accordance with their terms all of the obligations which by the terms of the Loan Documents are required to be performed by it as a Lender, and (iii) it will use any material nonpublic information and confidential information concerning Borrowers and their Affiliates and their equity interests in accordance with Section 11.23 of the Loan Agreement.

 

  

2.             Payments. From and after the Effective Date, the Agent shall make all payments in respect of the Assigned Interest (including payments of principal, interest, fees and other amounts) to the Assignor for amounts which have accrued to but excluding the Effective Date and to the Assignee for amounts which have accrued from and after the Effective Date. Notwithstanding the foregoing, the Agent shall make all payments of interest, fees or other amounts paid or payable in kind from and after the Effective Date to the Assignee.

 

3.             General Provisions. This Assignment Agreement shall be binding upon, and inure to the benefit of, the parties hereto and their respective successors and assigns. This Assignment Agreement may be executed in any number of counterparts, which together shall constitute one instrument. Delivery of an executed counterpart of a signature page of this Assignment Agreement by telecopy shall be effective as delivery of a manually executed counterpart of this Assignment Agreement. This Assignment Agreement shall be governed by, and construed in accordance with, the law of the State of New York.

 

4.             Condition Precedent. The obligations of the Assignor and the Assignee hereunder shall be subject to the fulfillment of the condition that the Assignor shall have (a) received all payments in respect of [the] [each] Assigned Interest (including, without limitation, payments of principal, interest, fees and other amounts), and (b) complied with other applicable provisions of Section 11.3 of the Loan Agreement.

 

5.             Method of Payment. All payments to be made by either party hereunder shall be in funds immediately available at the place of payment on the same day and shall be made by wire transfer to the account designated by the party to receive payment.

 

6.             Appointment and Authorization. The Assignee irrevocably appoints and authorizes, and agrees that it will require any transferee of any of its interest in its pro rata share of the Loan and in [the Note] irrevocably to appoint and authorize, the Agent, to take such actions as its agents on its behalf and to exercise such powers under the Loan Agreement and the other Loan Documents as are delegated by the terms thereof, together with such powers as are reasonably incidental thereto.

 

  

7.             Patriot Act Notification. Subject to the USA PATRIOT Act (Title III of Pub.L. 107-56 (signed into law October 26, 2001)) (the “Patriot Act”), Assignee hereby notifies the Borrower Parties that pursuant to the requirements of the Patriot Act, it is required to obtain, verify and record information that identifies the Borrower Parties, which information includes the name and address of the Borrower Parties and other information that will allow such Assignee to identify the Borrower Parties in accordance with the Patriot Act.

 

8.             Integration. This Agreement shall supersede any prior agreement or understanding between the parties (other than the Loan Agreement and the other Loan Documents) as to the subject matter hereof.

 

 

EXHIBIT D

Names of Operating Tenants

 

		Facility		Operating Tenant
1.		Lakeside Vista		Leisure Living Management of Holland, Inc.
2.		Buchanan Meadows		Leisure Living Management of Buchanan, Inc.
3.		Sunnybrook of Mt. Pleasant		ARHC SPPLSIA01 TRS, LLC
4.		Prairie Hills at Ottumwa		ARHC PHOTTIA01 TRS, LLC
5.		Sunnybrook of Carroll		ARHC SCCRLIA01 TRS, LLC
6.		Prairie Hills at Clinton		ARHC PHCTNIA01 TRS, LLC
7.		Addington Place of Titusville		ARHC TVTITFL01 TRS, LLC
8.		Sunnybrook of Muscatine		ARHC SMMTEIA01 TRS, LLC
9.		Camelia Walk Assisted Living and Memory Care		ARHC CWEVAGA01 TRS, LLC
10.		Prestige Pines		Leisure Living Management of Lansing, Inc.
11.		Prestige Commons		Lifehouse Prestige Commons Operations, LLC
12.		Prestige Centre		Lifehouse Mt. Pleasant Operations, LLC
13.		Golden Orchards		Lifehouse – Golden Acres Operations, LLC
14.		Crystal Springs		Lifehouse – Crystal Manor Operations, LLC
15.		Sunnybrook of Ft. Madison		ARHC SMMDSIA01 TRS, LLC
16.		Sunnybrook of Fairfield		ARHC SFFLDIA01 TRS, LLC
17.		Addington Place of Alpharetta		ARHC ALALPGA01 TRS, LLC
18.		Prairie Hills at Independence		ARHC PSINDIA01 TRS, LLC
19.		Addington Place of Brunswick		ARHC BWBRUGA01 TRS, LLC
20.		Addington Place of Dublin		ARHC DBDUBGA01 TRS, LLC
21.		Prairie Hills at Tipton		ARHC PHTIPIA01 TRS, LLC
22.		Ocean Park Memory Care		ARHC OPBROOR01 TRS, LLC
23.		Allegro at Helmwood		ARHC ALELIKY01 TRS, LLC

 

 

EXHIBIT E

Lender Addresses

 

Capital One, National Association

77 W. Wacker Drive, 10TH Floor

Chicago, Illinois 60601

Attention:

Jeffrey Muchmore, Credit Executive

Facsimile:

(855) 332-1699

Reference:

HTI/Senior Portfolio

 

with copy to:

 

Capital One, National Association

5804 Trailridge Drive

Austin, Texas 78731

Attention:

Diana Pennington, Senior Director, Associate General Counsel

Facsimile:

(855) 438-1132

Reference:

HTI/Senior Portfolio

 

with copy to:

 

Capital One, National Association

77 W. Wacker Drive, 10th Floor

Chicago, Illinois 60601

Attention:

Jason LaGrippe, Vice President

Facsimile:

(312) 739-3870

Reference:

HTI/Senior Portfolio

 

 

SCHEDULE 1.1(a)

 

MANAGEMENT AGREEMENTS

 

1.

Management Agreement by and between Leisure Living Management of Holland, Inc., a Michigan corporation, as tenant, and Homestead Management Group LLC, a Michigan limited liability company, as manager, dated as of June 8, 2017.

 

2.

Management Agreement by and between Leisure Living Management of Buchanan, LLC, a Michigan limited liability company, as tenant and Homestead Management Group LLC, a Michigan limited liability company, as manager, dated as of June 8, 2017.

 

3.

Management Agreement by and between ARHC SPPLSIA01 TRS, LLC, a Delaware limited liability company, as tenant, and Mount Pleasant Care Properties, LLC, an Oregon limited liability company, as manager, dated as of August 26, 2014, as amended by that certain First Addendum to Management Agreement dated December __, 2015.

 

4.

Management Agreement by and between ARHC PHOTTIA01 TRS, LLC, a Delaware limited liability company, as tenant, and Ottumwa Care Properties, LLC, an Oregon limited liability company, as manager, dated as of August 26, 2014, as amended by that certain First Addendum to Management Agreement dated December __, 2015.

 

5.

Management Agreement by and between ARHC SCCRLIA01 TRS, LLC, a Delaware limited liability company, as tenant, and Symphony Senior Living Limited Partnership, a Michigan limited partnership, dated as of May 27, 2016.*

 

6.

Management Agreement by and between ARHC SCCRLIA01 TRS, LLC, a Delaware limited liability company, as tenant, and Senior Housing Management Inc., an Iowa corporation as manager, dated as of January 1, 2018.

 

7.

Management Agreement by and between ARHC PHCTNIA01 TRS, LLC, a Delaware limited liability company, as tenant, and Symphony Senior Living Limited Partnership, a Michigan limited partnership, dated as of May 27, 2016.*

 

8.

Management Agreement by and between ARHC PHCTNIA01 TRS, LLC, a Delaware limited liability company, as tenant, and Senior Housing Management, Inc., an Iowa corporation, as manager, dated as of January 1, 2018.

 

9.

Management Agreement by and between ARHC TVTITFL01 TRS, LLC, a Delaware limited liability company, as tenant, and Symphony Senior Living Limited Partnership, a Florida limited liability company, as manager, dated as of November 1, 2016.*

 

^* The Management Agreements marked with an “*” are expiring as of December 31, 2017. Due to such expiration, with respect to the Projects covered by such Management Agreements, the Administrative Agent has approved only the replacement form Management Agreement with respect to such Project, and the scheduling of these expiring Management Agreements shall not be deemed to be an approval by the Administrative Agent that the forms thereof will be acceptable after such expiration on December 31, 2017.

 

  

10.

Management Agreement by and between ARHC TVTITFL01 TRS, LLC, a Delaware limited liability company, as tenant, and Concordis Management Titusville, LLC, a Florida limited liability company, as manager, dated as of January 1, 2018.

 

11.

Management Agreement by and between ARHC SMMTEIA01 TRS, LLC, a Delaware Limited liability company, as tenant and Muscatine Care Properties, an Oregon Limited liability company, as manager, dated as of August 26, 2014, as amended by that certain First Addendum to Management Agreement dated December __, 2015.

 

12.

Management Agreement by and among ARHC CWEVAGA01 TRS, LLC, a Delaware limited liability company, as tenant, NFR OP CO, LLC, a Georgia limited liability company, as subtenant, and Charter Senior Living Evans, LLC, a Georgia limited liability company, as manager, dated September 28, 2017.

 

13.

Management Agreement by and between Leisure Living Management of Lansing, Inc., a Michigan corporation, as tenant, and Homestead Management Group LLC, a Michigan limited liability company, as manager, dated as of June 8, 2017.

 

14.

Management Agreement by and between Lifehouse Prestige Commons Operations, LLC, a Michigan limited liability company, as tenant, and Homestead Management Group LLC, a Michigan limited liability company, as manager, dated as of June 8, 2017.

 

15.

Management Agreement by and between Lifehouse Mt. Pleasant Operations, LLC, a Michigan limited liability company, as tenant, and Homestead Management Group LLC, a Michigan limited liability company, as manager, dated as of June 8, 2017.

 

16.

Management Agreement by and between Lifehouse Golden Acres Operations, LLC, a Michigan limited liability company, as tenant, and Homestead Management Group LLC, a Michigan limited liability company, as manager, dated as of June 8, 2017.

 

17.

Management Agreement by and between Lifehouse Crystal Manor Operations, LLC, a Michigan limited liability company, as tenant, and Homestead Management Group LLC, a Michigan limited liability company, as manager, dated as of June 8, 2017.

 

18.

Management Agreement by and between ARHC SMMDSIA01 TRS, LLC, a Delaware limited liability company, as tenant, and Fort Madison Care Properties, LLC, an Oregon limited liability company, as manager, dated as of August 26, 2014, as amended by that certain First Addendum to Management Agreement dated December __, 2015.

 

19.

Management Agreement by and between ARHC SFFLDIA01 TRS, LLC, a Delaware limited liability company, as tenant, and Fairfield Care Properties, LLC, an Oregon Limited liability company, as manager, dated as of August 26, 2014, as amended by that certain First Addendum to Management Agreement dated December __, 2015.

 

  

20.

Management Agreement by and between ARHC ALALPGA01 TRS, LLC, a Delaware limited liability company, as tenant, and Symphony Senior Living Limited Partnership, a Florida limited liability company, as manager, dated as of November 1, 2016. *

 

21.

Management Agreement by and between ARHC ALALPGA01 TRS, LLC, a Delaware limited liability company, as tenant, and Phoenix Senior Living, LLC, a Georgia limited liability company, as manager, dated as of January 1, 2018.

 

22.

Management Agreement by and between ARHC PSINDIA01 TRS, LLC, a Delaware limited liability company, as tenant, and Symphony Senior Living Limited Partnership, a Florida limited liability company, as manager, dated as of May 27, 2016. *

 

23.

Management Agreement by and between ARHC PSINDIA01 TRS, LLC, a Delaware limited liability company, as tenant, and Senior Housing Management, Inc., an Iowa corporation, as manager, dated as of January 1, 2018.

 

24.

Management Agreement by and between ARHC BWBRUGA01 TRS, LLC, a Delaware limited liability company, as tenant, and Symphony Senior Living Limited Partnership, a Florida limited liability company, as manager, dated as of November 1, 2016. *

 

25.

Management Agreement by and between ARHC BWBRUGA01 TRS, LLC, a Delaware limited liability company, as tenant, and Oaks Senior Living, L.L.C., a Georgia limited liability company, as manager, dated as of January 1, 2018.

 

26.

Management Agreement by and between ARHC DBDUBGA01 TRS, LLC, a Delaware limited liability company, as tenant, and Symphony Senior Living Limited Partnership, a Florida limited liability company, as manager, dated as of November 1, 2016. *

 

27.

Management Agreement by and between ARHC DBDUBGA01 TRS, LLC, a Delaware limited liability company, as tenant, and Oaks Senior Living, L.L.C., a Georgia limited liability company, as manager, dated as January 1, 2018.

 

28.

Management Agreement by and between ARHC PHTIPIA01 TRS, LLC, a Delaware limited liability company, as tenant, and Symphony Senior Living Limited Partnership, a Florida limited liability company, as manager, dated as of May 27, 2016. *

 

29.

Management Agreement by and between ARHC PHTIPIA01 TRS, LLC, a Delaware limited liability company, as tenant, and Senior Housing Management, Inc., an Iowa corporation, as manager, dated as of January 1, 2018.

 

30.

Management Agreement by and between ARHC OPBROOR01 TRS, LLC, a Delaware limited liability company , as tenant, and Ocean Park Care Properties, LLC, an Oregon limited liability company, as manager, dated as of September 1, 2015.

 

^* See comment above.

^* See comment above.

 

  

31.

Management Agreement by and among ARHC ALELIKY01 TRS, LLC, a Delaware limited liability company, as tenant, The Allegro at Helmwood, LLC, a Kentucky limited liability company, as subtenant, and Love Management Company, LLC, a Missouri limited liability company d/b/a Allegro Management Company, as manager, dated as September 30, 2014.

 

 

SCHEDULE 1.1(b)

 

EXISTING PROPERTY MANAGERS

 

1.

Homestead Management Group, LLC

 

2.

Mount Pleasant Care Properties, LLC

 

3.

Ottumwa Care Properties, LLC

 

4.

Senior Housing Management, Inc.

 

5.

Concordis Senior Living, L.L.C.

 

6.

Muscatine Care Properties, LLC

 

7.

Charter Senior Living Evans, LLC

 

8.

Fort Madison Care Properties, LLC

 

9.

Fairfield Care Properties, LLC

 

10.

Phoenix Senior Living, L.L.C.

 

11.

Oaks Senior Living, L.L.C.

 

12.

Ocean Park Care Properties, LLC

 

13.

Love Management Company, LLC d/b/a Allegro Management Company

  

 

SCHEDULE 2.1

 

CONDITIONS TO ADVANCE OF LOAN PROCEEDS

 

The advance of the Loan proceeds shall be subject to the terms of the Loan Documents, and Administrative Agent’s receipt, review, approval and/or confirmation of the following items set forth in this Schedule 2.1, at Borrowers’ cost and expense, each in form and content satisfactory to Administrative Agent in its sole discretion:

 

1.

Loan Documents. The Loan Documents and Environmental Indemnity Agreement executed by Borrowers and/or Guarantor, as applicable.

 

2.

Title Insurance Policy. An ALTA (or equivalent) mortgagee policy or policies of title insurance in the Allocated Loan Amounts, with reinsurance and endorsements as Administrative Agent may require, containing no exceptions to title (printed or otherwise) which are unacceptable to Administrative Agent, and insuring that each Mortgage creates a first-priority Lien on Borrowers’ right title and interest in and to the Project and related collateral (each a “Title Policy” and collectively, the “Title Policies”).

 

3.

Organizational and Authority Documents. Certified copies of all documents evidencing the formation, organization, valid existence, good standing, and due authorization of and for Borrowers and each other Borrower Party for the execution, delivery, and performance of the Loan Documents and the Environmental Indemnity Agreement by Borrowers and each other Borrower Party, as applicable.

 

4.

Legal Opinions. Legal opinions issued by counsel for Borrowers and each other Borrower Party, opining as to the due organization, valid existence and good standing of Borrowers and each other Borrower Party, and the due authorization, execution, delivery, enforceability and validity of the Loan Documents and Environmental Indemnity Agreement with respect to Borrowers and each other Borrower Party; that the Loan, as reflected in the Loan Documents, is not usurious; the Loan do not create or constitute a partnership; compliance with licensing laws; and as to such other matters as Administrative Agent and Administrative Agent’s counsel reasonably may specify.

 

5.

Searches. Current Uniform Commercial Code, tax, judgment lien and litigation searches for Borrowers and each other Borrower Party, and the immediately preceding owner of the Project.

 

6.

Insurance. Evidence of insurance as required by this Agreement, and conforming in all respects to the requirements of Administrative Agent.

 

 

7.

Survey. Three (3) originals of a current “as built” survey of each Project, dated or updated to a date not earlier than thirty (30) days prior to the Closing Date, prepared by a registered land surveyor in accordance with the American Land Title Association American Congress on Surveying and Mapping Standards and containing Administrative Agent’s approved form of certification in favor of Administrative Agent (on behalf of itself and Lenders) and the title insurer (collectively, the “Survey”). The Survey shall conform to Administrative Agent’s current survey requirements and shall be sufficient for the title insurer to remove the general survey exception.

 

8.

Property Condition Report. A current engineering report or architect’s certificate with respect to the Projects, covering, among other matters, inspection of heating and cooling systems, roof and structural details and showing no failure of compliance with building plans and specifications, applicable legal requirements (including requirements of the Americans with Disabilities Act) and fire, safety and health standards (the “Property Condition Report,” whether one or more). As requested by Administrative Agent, the Property Condition Report shall also include an assessment of each Projects’ tolerance for earthquake and seismic activity.

 

9.

Environmental Reports. A current Site Assessment (as defined in the Environmental Indemnity Agreement) for each Project.

 

10.

Rent Roll. A current rent roll for each Project, certified by Borrowers or the current owner of the Projects. Such rent roll shall include such information as reasonably required by Administrative Agent.

 

11.

Operators’ Agreements. A copy of each fully executed Operator Agreement , in form and substance satisfactory to Administrative Agent, certified by Borrowers as being true, correct and complete.

 

12.

Tax and Insurance Impounds. Borrowers’ deposit with Administrative Agent of the amount required under this Agreement to impound for taxes and assessments, insurance premiums and to fund any other required escrows or reserves.

 

13.

Compliance with Laws. Evidence that the Projects and the operation thereof comply with all legal requirements, including that all requisite certificates of occupancy, building permits, and other licenses, certificates, approvals or consents required of any Governmental Authority have been issued without variance or condition and that there is no litigation, action, citation, injunctive proceedings, or like matter pending or threatened with respect to the validity of such matters. If title insurance with respect to the Projects (or any Project) described in item 2 above do not include a Zoning 3.1 (with parking) endorsement because such an endorsement is not available in the state where such Project is located, then Borrowers shall furnish to Administrative Agent a zoning letter from the applicable municipal agency with respect to such Project or a zoning report that verifies the zoning classification of the Project and such Project’s compliance with such zoning classification (the “Zoning Report”).

 

  

14.

No Casualty or Condemnation. No condemnation or adverse zoning or usage change proceeding shall have occurred or shall have been threatened against any Project; no Project shall have suffered any significant damage by fire or other casualty which has not been repaired; no law, regulation, ordinance, moratorium, injunctive proceeding, restriction, litigation, action, citation or similar proceeding or matter shall have been enacted, adopted, or threatened by any Governmental Authority, which would have, in Administrative Agent’s judgment, a material adverse effect on any Borrower, any other Borrower Party or any Project.

 

15.

Broker’s Fees. All fees and commissions payable to real estate brokers, mortgage brokers, or any other brokers or lenders in connection with the Loan or the acquisition of the Projects have been paid, such evidence to be accompanied by any waivers or indemnifications deemed necessary by Administrative Agent.

 

16.

Costs and Expenses. Payment of Administrative Agent’s and each Lender’s costs and expenses in underwriting, documenting, and closing the transaction, including fees and expenses of Administrative Agent’s and such Lender’s inspecting engineers, consultants and counsel.

 

17.

Representations and Warranties. The representations and warranties contained in this Loan Agreement and in all other Loan Documents and Environmental Indemnity Agreement are true and correct in all material respects as of the Closing Date (without duplication of any materiality qualifier contained therein), except to the extent that such representation or warranty expressly relates to an earlier date (in which event such representations and warranties were true and correct in all material respects (without duplication of any materiality qualifier contained therein) as of such earlier date).

 

18.

No Defaults. No Potential Default or Event of Default or default shall have occurred or exist.

 

19.

Appraisal. Administrative Agent shall obtain an appraisal report for each Project, in form and content acceptable to Administrative Agent, prepared by an independent MAI appraiser in accordance with the Financial Institutions Reform, Recovery and Enforcement Act (“FIRREA”) and the regulations promulgated pursuant to such act.

 

20.

Management. The Property Manager and any Operators’ Agreement for each Project shall be satisfactory to Administrative Agent in its sole discretion.

 

21.

Date Debt Yield. The Closing Date Debt Yield of at least 11%.

 

22.

Subordination and Non-Disturbance Agreements. Borrowers shall have delivered to Administrative Agent on the Closing Date subordination and non-disturbance agreements with respect to Operating Tenants agreed to by Administrative Agent, each of which shall be in form and substance satisfactory to Administrative Agent.

 

  

23.

Audit. An audit conducted by Administrative Agent’s internal audit team, and a clinical audit with respect to the Projects where healthcare services are being provided.

 

24.

Adverse Change. No Material Adverse Change shall have occurred.

 

25.

Other Items. Administrative Agent and Lenders shall have received such other items as Administrative Agent and Lenders may reasonably require.

 

 

 

SCHEDULE 4.1

 

EXCEPTIONS TO REPRESENTATIONS AND WARRANTIES REGARDING LEASES

 

None.

 

 

SCHEDULE 5.1

 

ORGANIZATION; FORMATION

 

 

 

ORGANIZATIONAL CHART

 

See Attached. 

 

 

SCHEDULE 5.4

 

Taxes and Assessments

 

None.

 

  

SCHEDULE 5.7

 

Condemnation

 

None.

 

 

SCHEDULE 5.9

 

LOCATIONS OF BORROWERS

 

Each Borrower’s principal place of business and chief executive office is located at:

 

405 Park Avenue

New York, New York 10022

 

 

SCHEDULE 5.24(a)

 

Third-Party Payor Programs

 

×

The following communities have a Medicaid contract that has been received however they have not received the “approval” letter yet:

 

o

Sunnybrook of Ft. Madison (5025 River Valley Road, Fort Madison, Iowa)

o

Sunnybrook of Fairfield (3000 W. Madison Avenue, Fairfield, Iowa)

  

 

SCHEDULE 5.24(b)

 

Primary Licenses

 

[EXCEL SPREADSHEET OF LICENSES TO BE ATTACHED]

 

SCHEDULE 5.24(c)

 

Governmental Investigations

 

None.

 

 

SCHEDULE 5.24(d)

 

Violations, Charges or Deficiencies

 

None.

 

 

SCHEDULE 6.2

 

COMPLIANCE CERTIFICATE

 

[ATTACHED SEPARATELY]

 

 

SCHEDULE 11.19

 

ALLOCATED LOAN AMOUNTS FOR THE PROJECTS

 

 

 

SCHEDULE 11.37

 

REQUIRED REPAIRS AND POST CLOSING OBLIGATIONS

 

1.

Within sixty (60) calendar days after the Closing Date (or such longer period as Administrative Agent may approve in writing in its sole discretion), the Borrowers shall take all actions required on the part of the Borrowers to cause the CONA Account to be opened and to execute and deliver to Administrative Agent a Deposit Account Control Agreement with respect to the CONA Account in form and substance reasonably satisfactory to Administrative Agent).

 

2.

Within one-hundred eighty (180) calendar days after the Closing Date (or such longer period as Administrative Agent may approve in writing in its sole discretion), the Borrowers shall complete all required repairs described in the spreadsheet attached to this Schedule 11.37; provided, however, with respect to (a) the required repairs to the magnetic door lock systems at the Project known as Prairie Hills at Clinton, as described on the spreadsheet attached to this Schedule 11.37, such repairs shall be completed within sixty (60) calendar days after the Closing Date (or such longer period as the Administrative Agent may approve in writing in its sole discretion), provided that the Company shall use commercially reasonable efforts to complete such repairs within thirty (30) calendar days after the Closing Date and on or before the end of such thirty-day period shall apprise the Administrative Agent of the status of such repairs, and (b) the required repairs with respect to the fire alarm system at the Project known as Prestige Pines, as described on the spreadsheet attached to this Schedule 11.37, such repairs shall be completed within thirty (30) calendar days after the Closing Date (or such longer period as the Administrative Agent may approve in writing in its sole discretion).

 

  

[EXCEL SCHEDULE OF REQUIRED REPAIRS TO BE ATTACHED]