FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D. C. 20549
(Mark One)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended SEPTEMBER 30, 1994
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from _______________ to ________________
Health Care REIT, Inc.
(Exact name of registrant as specified in its charter)
Delaware 34-1096634
(State or jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
One SeaGate, Suite 1950, Toledo, Ohio 43604
(Address of principal executive office) (Zip Code)
(Registrant's telephone number, including area code) (419) 247-2800
_________________________________________________________________
(Former name, former address and former fiscal year,
if changed since last report)
Indicate by check mark whether the registrant (1) has filed
all reports required to be filed by Section 13 or 15(d) of the
Securities Exchange Act of 1934 during the preceding 12 months (or
for such shorter period that the registrant was required to file
such reports), and (2) has been subject to such filing requirements
for the past 90 days. Yes X. No _____.
APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
PROCEEDINGS DURING THE PRECEDING FIVE YEARS:
Indicate by check mark whether the registrant has filed all
documents and reports required to be filed by Sections 12, 13 or
15(d) of the Securities Exchange Act of 1934 subsequent to the
distribution of securities under a plan confirmed by a court.
Yes _____. No _____.
APPLICABLE ONLY TO CORPORATE ISSUERS:
Indicate the number of shares outstanding of each of the
issuer's classes of common stock, as of the latest practicable
date.
Class: Shares of Common Stock, $1.00 par value
Outstanding 11,549,064 shares
<PAGE>
HEALTH CARE REIT, INC.
INDEX
Page
Part I. FINANCIAL INFORMATION
Item 1. Financial Statements (Unaudited)
Consolidated Balance Sheets as of September
30, 1994 and December 31, 1993 3
Consolidated Statements of Income -- Three
months ended September 30, 1994 and 1993;
Nine months ended September 30, 1994 and 1993. 4
Consolidated Statements of Cash Flows--Nine
months ended September 30, 1994 and 1993. 5
Consolidated Statements of Shareholders' Equity
-- Nine months ended September 30, 1994 and 1993. 6
Notes to Consolidated Financial Statements. 7
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations. 8
Part II. OTHER INFORMATION
Item 5. Other Information. 9
Item 6. Exhibits and Reports on Form 8-K. 10
SIGNATURES 11
<PAGE>
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
CONSOLIDATED BALANCE SHEETS
HEALTH CARE REIT, INC. AND SUBSIDIARY
<TABLE>
Sept. 30 Dec. 31
1994 1993
(Unaudited) (Note)
------------ ------------
<C> <C>
<S>
ASSETS
Real Estate Related Investments:
Loans receivable:
Mortgage loans $181,320,059 $165,147,444
Construction and other short-term loans 26,712,840 12,899,830
Working capital loans to related parties 6,664,122 7,234,327
------------ ------------
214,697,021 185,281,601
Investment in operating-lease properties 56,961,970 42,776,361
Investment in direct financing leases 20,338,741 52,950,188
------------ ------------
291,997,732 281,008,150
Less allowance for losses 4,650,000 4,150,000
------------ ------------
NET REAL ESTATE RELATED INVESTMENTS 287,347,732 276,858,150
Other Assets:
Escrow cash 14,173,402
Deferred loan expenses 2,474,183 1,579,134
Cash and cash equivalents 694,204 4,896,314
Receivables and other assets 2,069,933 1,690,783
------------ ------------
19,411,722 8,166,231
------------ ------------
$306,759,454 $285,024,381
============ ============
LIABILITIES AND SHAREHOLDERS' EQUITY
Liabilities:
Borrowings under line of credit arrangements $ 54,000,000 $ 35,000,000
Other long-term obligations 57,439,996 61,311,115
Accrued expenses and other liabilities 6,942,397 4,581,438
------------ ------------
TOTAL LIABILITIES 118,382,393 100,892,553
Shareholders' Equity:
Preferred Stock, $1.00 par value:
Authorized - 10,000,000 shares in 1994
Issued and outstanding - none
Common Stock, $1.00 par value:
Authorized - 40,000,000 and 15,000,000
shares in 1994 and 1993, respectively
Issued and outstanding - 11,549,064 in
1994 and 11,446,249 in 1993 11,549,064 11,446,249
Capital in excess of par value 160,275,322 158,013,957
Undistributed net income 16,552,675 14,671,622
------------ ------------
TOTAL SHAREHOLDERS' EQUITY 188,377,061 184,131,828
------------ ------------
$306,759,454 $285,024,381
============ ============
</TABLE>
NOTE: The balance sheet as of December 31, 1993 has been derived
from the audited financial statements at that date, but does not
include all of the information and footnotes required by generally
accepted accounting principles for complete financial statements.
See notes to consolidated financial statements
<PAGE>
CONSOLIDATED STATEMENTS OF INCOME (Unaudited)
HEALTH CARE REIT, INC. AND SUBSIDIARY
<TABLE>
Three Months Ended Nine Months Ended
September 30 September 30
1994 1993 1994 1993
----------------------- ----------- -----------
<C> <C> <C> <C>
<S>
Gross Income:
Interest and other income $ 7,707,712 $6,166,349 $19,151,904 $16,449,149
Direct financing leases:
Lease income 833,491 1,951,815 4,134,907 6,228,670
Gain on exercise of
options 229,379 267,505 3,851,147 1,861,266
Operating leases:
Rents 1,257,791 862,098 3,497,098 1,818,385
Gain on exercise of
options 100,029
Loan and commitment fees 489,793 498,415 955,035 940,717
----------- ---------- ----------- -----------
10,518,166 9,746,182 31,690,120 27,298,187
Expenses:
Interest:
Long-term obligations 1,479,452 2,455,586 4,625,548 5,393,833
Line of credit arrange-
ments 827,029 981,831 2,253,344 3,202,823
Loan expense 89,897 77,241 450,495 243,735
Management fees 761,170 598,567 2,352,798 1,802,906
Provision for losses 250,000 500,000 150,000
Provision for depreciation 349,229 230,171 998,259 517,038
Other operating expenses 435,222 330,732 1,399,402 985,277
----------- ---------- ----------- -----------
4,191,999 4,674,128 12,579,846 12,295,612
----------- ---------- ----------- -----------
NET INCOME $ 6,326,167 $5,072,054 $19,110,274 $15,002,575
=========== ========== =========== ===========
Average number of shares
outstanding 11,529,947 8,854,311 11,500,842 8,812,722
Net income per share $ .55 $ .57 $ 1.66 $ 1.70
Dividends per share $ .505 $ .485 $ 1.50 $ 1.44
</TABLE>
See notes to consolidated financial statements
<PAGE>
CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)
HEALTH CARE REIT, INC. AND SUBSIDIARY
<TABLE>
Nine Months Ended
September 30
1994 1993
----------------------------
<C> <C>
<S>
OPERATING ACTIVITIES:
Net income $ 19,110,274 $ 15,002,575
Adjustments to reconcile net income to net
cash provided by operating activities:
Amortization of loan and organization
expenses 452,112 243,735
Provision for losses 500,000 148,502
Provision for depreciation 998,259 517,038
Loan and commitment fees earned less
than cash received 369,159 368,309
Direct financing lease income less
than cash received 785,753 224,150
Interest income less than cash received 2,180,448 203,988
------------ ------------
FUNDS FROM OPERATIONS 24,396,005 16,708,297
Increase in accrued expenses and other
liabilities 1,473,154 2,407,056
Increase in other receivables and
prepaid items (380,768) (375,400)
------------ ------------
NET CASH PROVIDED FROM OPERATING ACTIVITIES 25,488,391 18,739,953
INVESTING ACTIVITIES:
Proceeds from exercise of lease purchase
options 28,205,953 9,033,205
(Increase) decrease in funds held in
escrow--net (14,173,402) 135,000
Investment in operating-lease properties (13,396,550) (11,250,000)
Investment in loans receivable (75,353,793) (71,233,286)
Investment in direct financing leases (1,300,000)
Principal collected on loans 47,408,995 27,580,383
------------ ------------
NET CASH USED IN INVESTING ACTIVITIES (28,608,797) (45,734,698)
FINANCING ACTIVITIES:
Long-term borrowings under line of credit
arrangements 188,100,000 203,000,000
Principal payments on long-term borrowings
under line of credit arrangements (169,100,000) (206,900,000)
Net proceeds from the issuance of shares 2,364,180 2,926,229
Borrowings under other long-term obligations 52,000,000
Principal payments on other long-term
obligations (3,871,119) (10,158,074)
Increase in deferred loan expense (1,345,544) (917,641)
Cash distributions to shareholders (17,229,221) (12,662,108)
------------ ------------
NET CASH (USED IN) PROVIDED
FROM FINANCING ACTIVITIES (1,081,704) 27,288,406
------------ ------------
(Decrease) increase in cash and cash
equivalents (4,202,110) 293,661
Cash and cash equivalents at beginning
of period 4,896,314 265,868
------------ ------------
CASH AND CASH EQUIVALENTS AT END OF PERIOD $ 694,204 $ 559,529
============ ============
Supplemental Cash Flow Information--
Interest Paid $ 5,747,073 $ 6,983,943
============ ============
</TABLE>
See notes to consolidated financial statements
<PAGE>
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY (Unaudited)
HEALTH CARE REIT, INC. AND SUBSIDIARY
<TABLE>
Nine Months Ended
September 30
1994 1993
----------------------------
<C> <C>
<S>
Balances at beginning of period $184,131,828 $118,947,994
Net income 19,110,274 15,002,575
Proceeds from issuance of shares under the
dividend reinvestment plan - 96,955 in
1994 and 128,277 in 1993 2,264,194 2,926,228
Proceeds from issuance of 5,860 shares
under the employee stock incentive plan 99,986
Cash dividend paid (17,229,221) (12,662,108)
------------ ------------
Balances at end of period $188,377,061 $124,214,689
============ ============
</TABLE>
See notes to consolidated financial statements
<PAGE>
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
HEALTH CARE REIT, INC. AND SUBSIDIARY
Note A - Basis of Presentation
The accompanying unaudited consolidated financial statements
have been prepared in accordance with generally accepted accounting
principles for interim financial information and with instructions
to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they
do not include all the information and footnotes required by
generally accepted accounting principles for complete financial
statements. In the opinion of management, all adjustments
(consisting of normal recurring accruals) considered for a fair
presentation have been included. Operating results for the nine
months ended September 30, 1994 are not necessarily an indication
of the results that may be expected for the year ended December 31,
1994. For further information, refer to the financial statements
and footnotes thereto included in the Company's annual report on
Form 10-K for the year ended December 31, 1993.
Net income per share has been computed by dividing net income
by the average number of shares outstanding.
Note B - Contingencies
As disclosed in the financial statements for the year ended
December 31, 1993, the Company was contingently liable for certain
obligations amounting to approximately $21,255,000. No significant
change in these contingencies has occurred as of September 30,
1994.
Note C - Dividend Distribution
In order to continue to qualify as a real estate investment
trust for federal income tax purposes, 95% of ordinary taxable
income must be distributed to shareholders. The Company estimates
that by December 31, 1994, undistributed net income for federal
income tax purposes will amount to approximately $15,650,000.
Note D - Noncash Transactions
During the first nine months, the Company reclassified two
direct financing lease properties, one for approximately $3,324,000
to a mortgage loan and one for approximately $3,582,000 to an
operating-lease property. Both reclassifications were due to
contract changes made in the ordinary course of business.
Item 2. Management's Discussion and Analysis of Financial
Condition
and Results of Operations
Liquidity and Capital Resources
During the first nine months of 1994, the Company financed
nine mortgage loans for a total of $46,838,000. In addition, the
Company advanced approximately $26,161,000 for 16 construction
loans of which three loans are additions to existing facilities.
Thirteen mortgage loans were paid off during the first nine months
of 1994 for a total of $43,422,000. The above loan activity, plus
changes in working capital loans and normal principal payments,
were the principal reasons net loans increased approximately
$29,415,000.
During the first nine months of 1994, the Company purchased
three facilities, made additional advances for two other operating-
lease properties, and completed construction on three other
facilities. In addition, one operating-lease lessee exercised its
option to purchase. The net effect of the above activity, plus the
noncash transaction mentioned in Note D, were the principal reasons
for the increase in operating-lease properties of approximately
$14,186,000. Also, eight direct financing lease purchase options
were exercised while the Company invested in one new direct
financing lease property. The eight lease exercises and one new
investment caused the investment in direct financing leases to
decline $32,611,000.
Effective September 9, 1994, the Company's principal line of
credit was expanded to $150 million and extended to March 31, 1997.
This amended line of credit increased the Company's borrowing
capacity by $40,000,000 and will allow the line to go unsecured
under certain conditions. Since December 31, 1993, borrowings
under lines of credit arrangements increased $19,000,000 partly due
to the investment activity discussed above. However, several
mortgage loans, which collateralized the Company's senior notes,
were paid off late in the third quarter. Until the Company's
proposed substituted investments are accepted by the senior note
holders, the Company has $14,173,000 in escrowed cash and
correspondingly higher line of credit balances. The Company
anticipates the escrowed funds will be released during the fourth
quarter. As of September 30, 1994, the Company had approximately
$113,637,000 in unfunded commitments and total available funding
sources of approximately $128,673,000.
During the first nine months of 1994, the Company received
$2,364,000 from the sale of its shares under the dividend
reinvestment and stock option plans.
Results of Operations
Gross income for the first nine months of 1994 was $31,690,000
or 16.1% greater than the first nine months of 1993. Except for
direct financing lease income, all major components of gross income
increased. The increase in interest income, operating-lease rents
and, to a lesser extent, loan and commitment fees is attributable
to the growth in the loan and operating-lease properties portfolio.
These are long-term trends which the Company anticipates will
continue. The decrease in direct financing lease income is a
reflection of another long-term trend which should continue due to
the greater market acceptance of mortgage loans and operating
leases.
Contributing to the increase in gross income in the first nine
months of 1994 over the comparable period in 1993 was the gain on
the exercise of lease purchase options. There were nine lessees
exercising options in 1994 versus five in 1993. These 1994
exercises resulted in an increase in gain on the exercise of lease
purchase options of $2,090,000.
Net income totalled $19,110,000 in the first nine months of
1994 versus $15,003,000 for the comparable period in 1993. While
net income increased, net income per share declined to $1.66 versus
$1.70 per share in the first nine months of 1993. The decline in
net income per share was primarily caused by the sale of 2,500,000
additional common shares in the fourth quarter of 1993.
The 1994 third quarter net income was also affected by several
trends. First, average earnings on assets declined 31 basis points
(excluding gains and prepayment fees) in the third quarter of 1994
versus the comparable period in 1993. The decline in average
earnings on assets reversed in the second quarter of 1994, which is
a reflection of the recent general rise in interest rates. The
narrowing of the net interest margin was heightened by an increase
of 156 basis points (1994 versus 1993) in the average cost of
borrowing. The average cost of borrowing increased in the third
quarter of 1994 over the earlier quarters. This increase is
principally due to the general rise in interest rates, the roll-
over to current rates of LIBOR loans and the increased pricing
premium paid under the Company's newly expanded line of credit
(discussed in "Liquidity and Capital Resources").
For the balance of 1994, the Company anticipates a continued
general rise in both its average earnings on assets and its average
cost of debt. Average earnings on assets is anticipated to rise
both because of the general interest rate environment and the
anticipated required conversion of certain variable interest-rate
assets to a higher fixed rate yield. Average cost of debt is
anticipated to rise because of the general interest rate
environment.
Lastly, the Company's net income was affected by the average
quarter-end debt-to-equity ratio of .63 to 1 in 1994 versus 1.12 to
1 in the first nine months of 1993. This decrease is solely due to
the 1993 fourth quarter equity offering in which the proceeds were
initially used to pay down debt. The decrease in debt had the
effect of decreasing the Company's interest-related expense, and
thereby, increasing net income.
PART II. OTHER INFORMATION
Item 5. Other Information
On July 19, 1994, the Board of Directors of Health Care REIT,
Inc. appointed a Special Committee to explore the advisability of
the Company becoming self-administered.
On July 20, 1994, the Company issued a press release in which
it announced, among other things, that the Board of Directors voted
to pay a quarterly cash dividend of $.505 payable to shareholders
of record on August 5, 1994, and that net income was $.68, an
increase of $.14 from the second quarter of 1993.
On July 21, 1994, the Company issued a press release in which
it announced, among other things, that the Board of Directors
adopted a Preferred Share Purchase Rights Plan and declared a
distribution of one Preferred Share Purchase Right on each
outstanding share of the Company's common stock.
On September 21, 1994, the Company announced, among other
things, the closing of a new $150 million revolving line of credit
with a consortium of eight banks.
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits
10. Specimen of Amended and Restated Credit
Agreement dated September 9, 1994
99. Press Release dated July 20, 1994
99. Press Release dated July 21, 1994
99. Press Release dated September 21, 1994
(b) Reports on Form 8-K
None
Pursuant to the requirement of the Securities and Exchange Act
of 1934, the Registrant had duly caused this report to be signed on
its behalf by the undersigned thereunto duly authorized.
HEALTH CARE REIT, INC.
Date: November 7, 1994 By: BRUCE G. THOMPSON
Bruce G. Thompson, Chairman
and Chief Executive Officer
Date: November 7, 1994 By: FREDERIC D. WOLFE
Frederic D. Wolfe, President
Date: November 7, 1994 By: ROBERT J. PRUGER
Robert J. Pruger, Chief
Financial Officer
Date: November 7, 1994 By: KATHLEEN S. PREPHAN
Kathleen S. Prephan, Chief
Accounting Officer
INDEX TO EXHIBITS
The following documents are included in this Form 10-Q as Exhibits:
Designation
Number Under
Exhibit Item 601 of Exhibit Page
Number Regulation S-K Description Number
- - - ------ -------------- ------------------------ ------
1 10 Amended and Restated 13
Credit Agreement dated
September 9, 1994
2 99 Press Release 319
dated July 20, 1994
3 99 Press Release 321
dated July 21, 1994
4 99 Press Release 322
dated September 21, 1994
EXECUTION COPY
AMENDED AND RESTATED
CREDIT AGREEMENT
Dated as of September 8, 1994
Among
HEALTH CARE REIT, INC.
as Borrower
THE BANKS WHICH ARE SIGNATORIES HERETO,
and
NATIONAL CITY BANK,
as Agent
TABLE OF CONTENTS
Section Page
ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS
1.01 Certain Defined Terms . . . . . . . . . . . . . . . 1
1.02 Computation of Time Periods . . . . . . . . . . . . 28
1.03 Accounting Terms . . . . . . . . . . . . . . . . . 28
1.04 Treatment of Subordinated Convertible Debt. . . . . 28
ARTICLE II
AMOUNTS AND TERMS OF THE LOANS
2.01 The Facility . . . . . . . . . . . . . . . . . . . 29
(a) Summary . . . . . . . . . . . . . . . . . . . . 29
(b) Purpose of the Facility . . . . . . . . . . . . 29
2.02 The Revolving Credit Loans. . . . . . . . . . . . . 29
(a) Revolving Credit Loans. . . . . . . . . . . . . 29
(b) Revolving Credit Borrowings . . . . . . . . . . 29
(c) Credit Requests . . . . . . . . . . . . . . . . 30
(d) Revolving Credit Notes. . . . . . . . . . . . . 30
(e) Banks to Fund Agent . . . . . . . . . . . . . . 30
(f) Availability of Funds . . . . . . . . . . . . . 31
(g) Failure of Bank to Loan . . . . . . . . . . . . 31
(h) Rate Conversion and Rate Continuation of
Revolving Credit Loans. . . . . . . . . . . . . 31
2.03 Reduction of Revolving Credit Commitments . . . . . 33
2.04 Repayments and Prepayments. . . . . . . . . . . . . 33
(a) Repayment . . . . . . . . . . . . . . . . . . . 33
(b) Permitted Prepayments . . . . . . . . . . . . . 33
(c) Mandatory Prepayments . . . . . . . . . . . . . 34
2.05 Fees. . . . . . . . . . . . . . . . . . . . . . . . 36
(a) Revolving Credit Commitment Fee . . . . . . . . 36
(b) Agent's Fee . . . . . . . . . . . . . . . . . . 36
2.06 Interest. . . . . . . . . . . . . . . . . . . . . . 36
(a) Pre-Default Interest. . . . . . . . . . . . . . 36
(b) Default Interest. . . . . . . . . . . . . . . . 37
(c) Additional Interest on LIBOR Rate Loans . . . . 37
(d) Interest Rate Determination . . . . . . . . . . 37
2.07 Payments and Computations . . . . . . . . . . . . . 38
(a) Payments. . . . . . . . . . . . . . . . . . . . 38
(b) Authorization to Charge Account . . . . . . . . 38
(c) Computations of Interest and Fees . . . . . . . 38
(d) Payment not on Business Day . . . . . . . . . . 38
(e) Presumption of Payment in Full by Borrower. . . 38
2.08 Addition and Release of Collateral. . . . . . . . . 39
(a) Addition of Specific Collateral . . . . . . . . 39
(b) Release of Specific Collateral;
Ordinary Course . . . . . . . . . . . . . . . . 39
(c) Release of Collateral; Environmental Harm . . . 40
(d) Release of All Collateral; BBB+ Rating Event. . 40
(e) Release of Collateral; BBB Rating Event . . . . 41
(f) Subsequent Collateralization. . . . . . . . . . 42
(g) Release Agreements and Covenants. . . . . . . . 42
2.09 Addition of Other Assets to Borrowing Base;
Alternative Investment Structure. . . . . . . . . . 43
(a) Addition of Other Assets to Borrowing Base . . 43
(b) Alternative Investment Structures . . . . . . . 44
2.10 Illegality. . . . . . . . . . . . . . . . . . . . . 44
2.11 Unavailability. . . . . . . . . . . . . . . . . . . 45
(a) Inadequate Rate . . . . . . . . . . . . . . . . 45
(b) Unavailable Quotations. . . . . . . . . . . . . 45
(c) Unavailable Deposits. . . . . . . . . . . . . . 45
ARTICLE III
CONDITIONS OF LENDING
3.01 Conditions Precedent to Initial Revolving
Credit Borrowing. . . . . . . . . . . . . . . . . . 45
3.02 Conditions to Eligibility for Initial
Borrowing Base Assets . . . . . . . . . . . . . . . 48
(a) Operator Leases . . . . . . . . . . . . . . . . 48
(b) Eligible Operator Loans . . . . . . . . . . . . 51
(c) Cross Collateralized Loans. . . . . . . . . . . 53
3.03 Addition of Borrowing Base Assets - Deliveries. . . 54
(a) Operator Leases . . . . . . . . . . . . . . . . 54
(b) Operator Loans. . . . . . . . . . . . . . . . . 57
(c) Cross Collateralized Loans. . . . . . . . . . . 59
(d) Filings for Perfection. . . . . . . . . . . . . 60
3.04 Conditions Precedent to all Revolving Credit
Loans . . . . . . . . . . . . . . . . . . . . . . . 60
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
4.01 Existence . . . . . . . . . . . . . . . . . . . . . 61
4.02 Power, Authorization and Consent. . . . . . . . . . 61
4.03 Enforceability. . . . . . . . . . . . . . . . . . . 62
4.04 Litigation; Proceedings . . . . . . . . . . . . . . 63
4.05 Taxes . . . . . . . . . . . . . . . . . . . . . . . 63
4.06 Title . . . . . . . . . . . . . . . . . . . . . . . 63
4.07 ERISA . . . . . . . . . . . . . . . . . . . . . . . 63
4.08 Adverse Obligations; Labor Disputes . . . . . . . . 64
4.09 Financial Statements. . . . . . . . . . . . . . . . 64
4.10 Insurance . . . . . . . . . . . . . . . . . . . . . 64
4.11 Solvency. . . . . . . . . . . . . . . . . . . . . . 64
4.12 Investment Company Act Status . . . . . . . . . . . 64
4.13 Regulation G/Regulation U/Regulation X
Compliance. . . . . . . . . . . . . . . . . . . . . 64
4.14 Environmental Compliance. . . . . . . . . . . . . . 65
4.15 Environmental Laws and Permits. . . . . . . . . . . 66
4.16 Compliance with Laws. . . . . . . . . . . . . . . . 66
4.17 Condemnation Proceedings. . . . . . . . . . . . . . 67
4.18 Locations . . . . . . . . . . . . . . . . . . . . . 67
4.19 Material Contracts. . . . . . . . . . . . . . . . . 67
4.20 Full Disclosure . . . . . . . . . . . . . . . . . . 67
4.21 Liabilities . . . . . . . . . . . . . . . . . . . . 68
4.22 Status of the Borrower. . . . . . . . . . . . . . . 68
4.23 Qualified Investment; Eligibility . . . . . . . . . 68
4.24 Name Changes. . . . . . . . . . . . . . . . . . . . 68
4.25 Borrowing Base Assets . . . . . . . . . . . . . . . 68
4.26 Other Representations . . . . . . . . . . . . . . . 69
ARTICLE V
COVENANTS OF THE BORROWER
5.01 Financial Information . . . . . . . . . . . . . . . 69
(a) Quarterly Financial Statements. . . . . . . . . 69
(b) Annual Consolidated Financial Statements. . . . 69
(c) Annual Consolidating Financial Statements . . . 70
(d) Borrower's Certificates and Reports . . . . . . 70
(e) Publicly Filed Information. . . . . . . . . . . 71
(f) Other Information . . . . . . . . . . . . . . . 71
5.02 Notices . . . . . . . . . . . . . . . . . . . . . . 71
(a) Notice of Default; Misrepresentation. . . . . . 71
(b) Notice of Default under ERISA . . . . . . . . . 72
(c) Notice of Litigation. . . . . . . . . . . . . . 72
(d) Taxes . . . . . . . . . . . . . . . . . . . . . 72
(e) Environmental Reporting . . . . . . . . . . . . 72
(f) Notice of New Subsidiary. . . . . . . . . . . . 72
5.03 Affirmative Covenants . . . . . . . . . . . . . . . 73
(a) Taxes . . . . . . . . . . . . . . . . . . . . . 73
(b) Financial Records . . . . . . . . . . . . . . . 73
(c) Visitation. . . . . . . . . . . . . . . . . . . 73
(d) Insurance . . . . . . . . . . . . . . . . . . . 73
(e) Corporate Existence; REIT Qualification . . . . 74
(f) Compliance with Environmental Laws. . . . . . . 74
(g) Compliance With Law . . . . . . . . . . . . . . 74
(h) Remedial Action . . . . . . . . . . . . . . . . 74
(i) Properties. . . . . . . . . . . . . . . . . . . 75
(j) Compliance with Terms of All Material
Contracts . . . . . . . . . . . . . . . . . . . 75
(k) Qualification to do Business. . . . . . . . . . 75
(l) Liens and Encumbrances . . . . . . . . . . . . 75
(m) Mandatory Reappraisal . . . . . . . . . . . . . 75
(n) Requested Reappraisal . . . . . . . . . . . . . 75
5.04 Negative Covenants. . . . . . . . . . . . . . . . . 76
(a) Equity Transactions . . . . . . . . . . . . . . 76
(b) Restricted Payments . . . . . . . . . . . . . . 78
(c) Credit Extensions; Investments in Notes, Etc. . 79
(d) Indebtedness. . . . . . . . . . . . . . . . . . 80
(e) Liens; Leases . . . . . . . . . . . . . . . . . 81
(f) Name Change; Fictitious Name. . . . . . . . . . 82
(g) Charter Amendments. . . . . . . . . . . . . . . 82
(h) Accounting Changes. . . . . . . . . . . . . . . 82
(i) Amendment; Default of Material Contracts. . . . 82
(j) Senior Note Documents . . . . . . . . . . . . . 83
(k) Use of Proceeds . . . . . . . . . . . . . . . . 83
(l) Adverse Obligations . . . . . . . . . . . . . . 83
(m) Transactions with Affiliates. . . . . . . . . . 83
(n) Maintenance of Borrowing Base . . . . . . . . . 83
(o) Portfolio Concentration Limitation. . . . . . . 84
(p) Other Financing Limitations . . . . . . . . . . 84
(q) Portfolio Diversification Requirement . . . . . 85
(r) Borrowing Base Concentration Limitation . . . . 85
5.05 Financial Covenants . . . . . . . . . . . . . . . . 85
(a) Consolidated Tangible Net Worth . . . . . . . . 85
(b) Consolidated Interest Coverage. . . . . . . . . 86
(c) Consolidated Leverage Ratio . . . . . . . . . . 86
(d) Consolidated Contingent Leverage Ratio. . . . . 86
(e) Borrowing Base Debt Coverage Ratio. . . . . . . 86
ARTICLE VI
EVENTS OF DEFAULT
6.01 Events of Default . . . . . . . . . . . . . . . . . 86
(a) Payments. . . . . . . . . . . . . . . . . . . . 86
(b) Covenants Without Grace . . . . . . . . . . . . 87
(c) Covenants with Grace. . . . . . . . . . . . . . 87
(d) Warranties. . . . . . . . . . . . . . . . . . . 87
(e) Cross Default . . . . . . . . . . . . . . . . . 87
(f) Change in Control . . . . . . . . . . . . . . . 87
(g) Judgments . . . . . . . . . . . . . . . . . . . 87
(h) Subsidiary's Solvency . . . . . . . . . . . . . 88
(i) Borrower's Solvency . . . . . . . . . . . . . . 88
(j) ERISA . . . . . . . . . . . . . . . . . . . . . 88
(k) Enforceability. . . . . . . . . . . . . . . . . 88
6.02 Remedies Upon Event of Default. . . . . . . . . . . 88
(a) Optional Defaults . . . . . . . . . . . . . . . 88
(b) Automatic Defaults. . . . . . . . . . . . . . . 89
(c) Recourse of Banks . . . . . . . . . . . . . . . 89
6.03 Offsets . . . . . . . . . . . . . . . . . . . . . . 89
6.04 Equalization. . . . . . . . . . . . . . . . . . . . 89
6.05 Application of Proceeds of Collateral . . . . . . . 90
ARTICLE VII
THE AGENT
7.01 The Agent . . . . . . . . . . . . . . . . . . . . . 90
7.02 Nature of Appointment . . . . . . . . . . . . . . . 90
7.03 NCB as a Bank; Other Transactions . . . . . . . . . 90
7.04 Instructions from Banks . . . . . . . . . . . . . . 91
7.05 Bank's Diligence. . . . . . . . . . . . . . . . . . 91
7.06 No Implied Representations. . . . . . . . . . . . . 91
7.07 Sub-Agents. . . . . . . . . . . . . . . . . . . . . 91
7.08 Agent's Diligence . . . . . . . . . . . . . . . . . 91
7.09 Notice of Default . . . . . . . . . . . . . . . . . 92
7.10 Agent's Liability . . . . . . . . . . . . . . . . . 92
7.11 Compensation. . . . . . . . . . . . . . . . . . . . 92
7.12 Agent's Indemnity . . . . . . . . . . . . . . . . . 93
7.13 Resignation . . . . . . . . . . . . . . . . . . . . 93
7.14 Bank Purpose. . . . . . . . . . . . . . . . . . . . 93
ARTICLE VIII
TRANSFERS AND ASSIGNMENTS
8.01 Transfer of Commitments . . . . . . . . . . . . . . 94
(a) Prior Consent . . . . . . . . . . . . . . . . . 94
(b) Agreement; Transfer Fee . . . . . . . . . . . . 94
(c) Note. . . . . . . . . . . . . . . . . . . . . . 95
(d) Parties . . . . . . . . . . . . . . . . . . . . 95
8.02 Sale of Participations. . . . . . . . . . . . . . . 95
(a) Benefits of Participant . . . . . . . . . . . . 95
(b) Rights Reserved . . . . . . . . . . . . . . . . 95
(c) No Delegation . . . . . . . . . . . . . . . . . 96
8.03 Confidentiality . . . . . . . . . . . . . . . . . . 96
ARTICLE IX
INDEMNITIES
9.01 Increased Costs . . . . . . . . . . . . . . . . . . 96
9.02 Risk-Based Capital. . . . . . . . . . . . . . . . . 97
9.03 Taxes . . . . . . . . . . . . . . . . . . . . . . . 97
(a) Taxes; Withholding. . . . . . . . . . . . . . . 97
(b) Stamp Taxes . . . . . . . . . . . . . . . . . . 97
(c) Other Taxes . . . . . . . . . . . . . . . . . . 98
(d) Request for Refund. . . . . . . . . . . . . . . 98
(e) Exemption Certificate . . . . . . . . . . . . . 98
(f) Furnishing of Certificate . . . . . . . . . . . 99
(g) Survival of Provision . . . . . . . . . . . . . 99
9.04 Funding Costs . . . . . . . . . . . . . . . . . . . 99
9.05 Losses. . . . . . . . . . . . . . . . . . . . . . . 99
9.06 Indemnification for Requests. . . . . . . . . . . . 99
9.07 Takeovers . . . . . . . . . . . . . . . . . . . . . 100
9.08 Certificate for Indemnification . . . . . . . . . . 100
9.09 Costs and Expenses. . . . . . . . . . . . . . . . . 100
9.10 Duty To Mitigate. . . . . . . . . . . . . . . . . . 101
ARTICLE X
MISCELLANEOUS
10.01 Amendments and Waivers. . . . . . . . . . . . . . . 101
10.02 Cumulative Provisions . . . . . . . . . . . . . . . 102
10.03 Binding Effect. . . . . . . . . . . . . . . . . . . 102
10.04 Survival of Provisions. . . . . . . . . . . . . . . 102
10.05 Immediate U.S. Funds. . . . . . . . . . . . . . . . 102
10.06 Captions. . . . . . . . . . . . . . . . . . . . . . 102
10.07 Interest Rate Limitation. . . . . . . . . . . . . . 102
10.08 Illegality. . . . . . . . . . . . . . . . . . . . . 103
10.09 Notices . . . . . . . . . . . . . . . . . . . . . . 103
10.10 Governing Law . . . . . . . . . . . . . . . . . . . 103
10.11 Entire Agreement. . . . . . . . . . . . . . . . . . 103
10.12 Waiver of Jury Trial. . . . . . . . . . . . . . . . 103
10.13 Jurisdiction; Venue . . . . . . . . . . . . . . . . 103
(a) Jurisdiction. . . . . . . . . . . . . . . . . . 103
(b) Venue; Inconvenient Forum . . . . . . . . . . . 104
10.14 Execution in Counterparts . . . . . . . . . . . . . 104
EXHIBITS AND SCHEDULES
Exhibit A - Form of Revolving Credit Note
Exhibit B - Form of Credit Request
Exhibit C - Form of Rate Conversion/Continuation Request
Exhibit D - Form of Reduction Notice
Exhibit E - Form of Notice of Borrowing Base Addition/Removal
Exhibit F-1 - Form of Opinion of Borrower's Counsel (Borrower Fee
Properties)
Exhibit F-2 - Form of Opinion of Borrower's Counsel (Operator Fee
Properties)
Exhibit F-3 - Form of Opinion of Borrower's Counsel (Other
Corporate Matters)
Exhibit G-1 - Form of Borrower's Officer's Certificate
Exhibit G-2 - Form of Subsidiary Officer's Certificate
Exhibit H-1 - Form of Open-End Mortgage and Security Agreement
Exhibit H-2 - Form of Deed of Trust and Security Agreement
Exhibit I - Form of Collateral Assignment of Operator Loan
Documents
Exhibit J - Form of Subsidiary Guaranty Agreement
Exhibit K - Form of Collateral Assignment of Operator Lease
Documents and Rents
Exhibit L-1 - Form of Security Agreement (General Intangibles)
Exhibit L-2 - Form of Amendment to Security Agreement
Exhibit M-1 - Form of Compliance Certificate
Exhibit M-2 - Form of Borrowing Base Report
Exhibit M-3 - Form of Quarterly Receivable Aging Schedule
Exhibit M-4 - Form of Quarterly Liability Schedule
Exhibit N - Form of Assignment Agreement
Schedule I - Revolving Credit Commitments
Schedule II - Eligible Operator Leases and Eligible Operator Loans
Supplemental Schedule
<PAGE>
AMENDED AND RESTATED
CREDIT AGREEMENT
Dated as of September 8, 1994
HEALTH CARE REIT, INC., a Delaware corporation (the
"Borrower"), the Banks listed on the signature pages hereof, and
NATIONAL CITY BANK ("NCB"), as agent (the "Agent") for the Banks
hereunder, agree as follows:
ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS
SECTION 1.01 Certain Defined Terms. As used in this
Agreement, the following capitalized terms shall have the following
meanings (such meanings to be equally applicable to both the
singular and plural forms of the terms defined):
"Acceptable Marketable Securities" means securities that
are direct obligations of the United States of America or any
agency thereof, or certificates of deposit issued by any Bank or by
any other financial institution organized under the laws of the
United States or any state thereof which is approved in writing by
the Agent, in the Agent's reasonable discretion, or any other
money-market investment if it carries the highest quality rating of
any nationally recognized rating agency; provided, however, that no
such security shall mature more than ninety (90) days after the
date when made.
"Accumulated Funding Deficiency" has the meaning ascribed
thereto in section 302(a)(2) of ERISA.
"Additional Indebtedness" has the meaning ascribed
thereto in Section 5.04(d).
"Advantage" means any payment (whether made voluntarily
or involuntarily, by offset of any deposit or other Indebtedness or
otherwise) received by a Bank in respect of the Obligations if the
payment results in any other Bank's having more than its Ratable
Portion of the Obligations in question.
"Affiliate" means, with respect to a specified Person,
any other Person: (a) which directly or indirectly through one or
more intermediaries controls, or is controlled by, or is under
common control with such Person, (b) which beneficially owns or
holds with power to vote five percent (5%) or more of any class of
the voting stock of such Person, (c) five percent (5%) or more of
the voting stock of which other Person is beneficially owned or
held by such Person, or (d) who is an officer or director of such
Person. The term "control" means the possession, directly or
indirectly, of the power to direct or cause the direction of the
management and policies of a Person, whether through the ownership
of voting securities, by contract or otherwise.
"Agent" means National City Bank in its capacity as
administrative agent or any successor acting in such capacity.
"Agreement" means this Amended and Restated Credit
Agreement, which amends and restates in its entirety that certain
Second Amended and Restated Agreement, dated as of October 1, 1989,
among the Borrower, NCB, as agent and the banks indicated therein,
and includes each amendment, if any, to this Amended and Restated
Credit Agreement.
"Anniversary Date" means each September 8 during the term
of this Agreement.
"Appraised Value" means, as to any asset, the appraised
value of such asset as determined and set forth in writing by an
independent certified M.A.I. appraiser experienced in appraising
Health Care Facilities; provided, however, that, in the event that
such written appraisal in respect of any Borrowing Base Asset is
dated as of a date more than three (3) years prior to the date of
determination and the Agent or any Bank has required that the
Borrower obtain an updated written appraisal pursuant to Section
5.03(m) and such appraisal is not delivered within the time period
required by Section 5.03(m), until such updated appraisal has been
delivered to the Agent and approved by the Bank or Banks requesting
such update, the Asset Value of such Borrowing Base Asset shall be
Zero Dollars ($0).
"Asset Value" means, as at any date of determination, an
amount equal to the least of: (a) the Lease Value of such asset as
at such date, (b) the Carrying Value of such asset as at such date,
(c) the Appraised Value of such asset, (d) as to any Borrowing Base
Asset, such portion of the least of such Lease Value, Carrying
Value or Appraised Value of such asset which, when taken together
with the aggregate of the Asset Values of all other Borrowing Base
Assets operated by the Operator of such asset or any Operator
Affiliate of the Operator, does not exceed seventeen and one-half
percent (17.5%) of the aggregate Asset Value of all Borrowing Base
Assets, (e) as to any Borrowing Base Asset, such portion of the
least of the Lease Value, Carrying Value or Appraised Value of such
asset which does not exceed fifteen percent (15%) of the Asset
Value of all Borrowing Base Assets, (f) as to any Borrowing Base
Asset, Zero Dollars ($0) during the period commencing on the date
upon which the Operator of such asset is in default for ninety (90)
days under Eligible Operator Loan Documents or such Eligible
Operator Lease Documents of such Operator, as the case may be, and
ending on the date on which all such defaults have been waived or
cured, (g) as to any Borrowing Base Asset, Zero Dollars ($0) in the
event that such Borrowing Base Asset no longer meets the
eligibility requirements set forth in the definition of Eligible
Operator Lease or Eligible Operator Loan, as the case may be, (h)
as to any Borrowing Base Asset, Zero Dollars ($0) in the event that
such Borrowing Base Asset is a Cross-Collateralized Operator Loan
or (i) as to any Borrowing Base Asset, Zero Dollars ($0) in the
event that such Borrowing Base Asset relates to a Borrower Fee
Property or Operator Fee Property with respect to which there has
been any noncompliance with any Environmental Law (including
noncompliance with or failure to obtain any Environmental Permit)
or any Environmental Claim or any other environmental condition
which noncompliance, failure or condition, taken singly or together
with all such noncompliances, failures or conditions, has resulted
in or would, more likely than not, result in a Material Impairment
of such Borrowing Base Asset.
"Assigned Title Policy" means any title policy assigned
to the Agent for the benefit of the Banks delivered pursuant to
Section 3.02(b)(vi), Section 3.03(b)(ix) or otherwise delivered to
the Agent for the benefit of the Banks in respect of a Borrowing
Base Asset.
"Banks" means the banks listed on the signature pages
hereof and the successors thereto and assignees thereof.
"Borrow" means to obtain a Revolving Credit Borrowing.
"Borrower" has the meaning ascribed to such term in the
introductory paragraph hereof.
"Borrower Fee Property" means any real property owned by
the Borrower in fee simple.
"Borrower Mortgage" means any mortgage or amendment and
restatement of any such mortgage with respect to a Borrower Fee
Property relating to any Eligible Operator Lease executed and
delivered to the Agent for the benefit of the Banks substantially
in the form of Exhibit H-1 or Exhibit H-2 hereto.
"Borrowing Base" means an amount which shall equal but
not at any time exceed seventy-five percent (75%) of the aggregate
Asset Value of the Borrowing Base Assets.
"Borrowing Base Assets" means all Eligible Operator
Leases and all Eligible Operator Loans of the Borrower identified
as such on any Borrowing Base Report certified by the Borrower.
"Borrowing Base Report" means the report delivered by the
Borrower pursuant to Section 5.01(d).
"Borrower's Balance Sheet Assets" means, as at the date
of any determination, all of the assets of the Borrower and its
Subsidiaries as at such date (excluding treasury shares) on a
consolidated basis, as reflected on the consolidated balance sheet
of the Borrower and its Subsidiaries, as determined in accordance
with generally accepted accounting principles.
"Business Day" means a day of the year on which banks
are not required or authorized to close in Cleveland, Ohio and, if
the applicable Business Day relates to any LIBOR Rate Loans, a day
of the year on which dealings in Dollar deposits are carried on in
the London interbank market and banks are open for business in
London.
"Carrying Value" means, with respect to Eligible Operator
Loans, as at any date of any determination, the principal amount of
such Eligible Operator Loan outstanding at such date.
"Cash Flow" means, for any period, the Borrower's
Consolidated Net Income for such period, excluding extraordinary
items net of tax effect, plus depreciation, plus amortization of
loan expenses, plus (minus) any change in provision for losses,
plus (minus) each of the following: (i) non-refundable loan and
commitment fees received in cash in excess of (less than) amounts
earned; (ii) non-refundable lease income received in cash in excess
of (less than) amounts earned; and (iii) non-refundable interest
income received in cash in excess of (less than) amounts earned.
"CERCLA" means the Comprehensive Environmental Response,
Compensation and Liability Act, as amended, 42 U.S.C. Sections 9601 et
seq.
"Closing Date" means September 8, 1994.
"Collateral" means all collateral in which a Lien is or
may hereafter be granted to the Agent for the benefit of the Banks
pursuant to the Collateral Documents and all other property that is
subject to any Lien in favor of the Agent for the benefit of the
Banks, including, without limitation, the collateral listed on
Schedule II hereto and any assignable interest in a mortgage
securing any REMIC invested in by the Borrower which has been
assigned to the Agent for the benefit of the Banks.
"Collateral Assignment of Operator Lease Documents" means
a Collateral Assignment of Operator Lease Documents and Rents or an
Amended and Restated Collateral Assignment of Operator Lease
Documents and Rents, substantially in the form of Exhibit K hereto.
"Collateral Assignment of Operator Loan Documents" means
a Collateral Assignment of Operator Loan Documents or an Amended
and Restated Collateral Assignment of Operator Loan Documents,
substantially in the form of Exhibit I hereto.
"Collateral Assignments" means, collectively, each
Collateral Assignment of Operator Lease Documents and each
Collateral Assignment of Operator Loan Documents executed and
delivered to the Agent pursuant to Article III from time to time or
any other assignment document delivered in connection with a
Borrowing Base Asset from time to time.
"Collateral Documents" means the Borrower Mortgages and
the Collateral Assignments, the Security Agreement, and Security
Agreement Amendment or any other document delivered from time to
time in connection with a Borrowing Base Asset for the purpose of
creating a Lien in favor of the Agent for the Benefit of the Banks
in respect of such Borrowing Base Asset.
"Consolidated Contingent Liabilities" means, as at the
date of any determination, any Guaranty, any Credit Enhancement,
any indemnification obligation or any obligation under a letter of
credit.
"Consolidated Funded Indebtedness" means, as at the date
of any determination, Indebtedness of the Borrower and its
Subsidiaries for money borrowed determined on a consolidated basis
in accordance with generally accepted accounting principles,
including, without limitation, all notes payable and drafts
accepted representing extensions of credit, all obligations
evidenced by bonds, debentures, notes or other similar instruments
and all obligations upon which interest charges are customarily
paid or discounted, plus the obligations of the Borrower and its
Subsidiaries as lessee under leases which shall have been or should
be, in accordance with generally accepted accounting principles
recorded as capital leases, plus the obligations of the Borrower to
pay a deferred purchase price for goods or services (other than
ordinary course trade payables).
"Consolidated Interest Coverage Ratio" means, for any
period, the ratio of (a) the sum of Consolidated Net Income plus
interest expense of the Borrower and its Subsidiaries for such
period plus federal, state and local taxes of the Borrower and its
Subsidiaries for such period plus depreciation and amortization
expense for the Borrower and its Subsidiaries for such period to
(b) the interest expense of the Borrower and its Subsidiaries for
such period, in each case as determined on a consolidated basis in
accordance with generally accepted accounting principles.
"Consolidated Net Income" means, for any period, the
aggregate net income of the Borrower and its Subsidiaries for such
period (after taxes and after extraordinary items, but without
giving effect to any gain from any re-appraisal or write-up of any
asset), as determined on a consolidated basis in accordance with
generally accepted accounting principles.
"Consolidated Net Worth" means, as at the date of any
determination, the excess of the net book value (after deducting
all applicable valuation reserves and without consideration to any
reappraisal or write-up of assets) of all of the tangible and
intangible assets of the Borrower and its Subsidiaries as at such
date (including intangible assets such as patents, costs of
businesses over net assets acquired, goodwill and treasury shares)
over Consolidated Total Liabilities as at such date, in each case
as determined on a consolidated basis in accordance with generally
accepted accounting principles.
"Consolidated Tangible Net Worth" means, as of the date
of any determination, the excess of the net book value (after
deducting all applicable valuation reserves and without
consideration to any reappraisal or write-up assets) of all of the
tangible assets of the Borrower and its Subsidiaries as at such
date (i.e., all assets excluding intangibles assets such as
patents, costs of businesses over net assets acquired, goodwill and
treasury shares) over Consolidated Total Liabilities as at such
date, as determined on a consolidated basis in accordance with
generally accepted accounting principles.
"Consolidated Total Liabilities" means, as at the date of
any determination, the aggregate of all liabilities of the Borrower
and its Subsidiaries at such date, as determined on a consolidated
basis in accordance with generally accepted accounting principles.
"Credit Enhancements" means any obligation, direct
orindirect, contingent or otherwise, of the Borrower or any of its
Subsidiaries: (a) to guaranty any Indebtedness or obligation of any
Person, (b) to purchase or pay (or advance or supply funds for the
purchase or payment of) such Indebtedness or any other obligation
of such Person (whether arising by virtue of partnership
arrangements, or securities or services, take-or-pay agreements, or
agreements to maintain financial statement conditions or otherwise)
or (c) entered into for purposes of assuring in any other manner
the obligee of such Indebtedness or other obligation of the payment
thereof or protecting such obligee against loss in respect thereof
(in whole or in part).
"Credit Request" has the meaning specified in Section
2.02(c).
"Cross-Collateralized Operator Loan" means an Operator
Loan with respect to which (a) the Operator of the Health Care
Facility with respect to such Operator Loan is the Operator of a
Health Care Facility in respect of which there is an Operator Loan
which is an Eligible Operator Loan identified as a Borrowing Base
Asset on a Borrowing Base Report which Operator Loan is cross-
collateralized with such Eligible Operator Loan, (b) the criteria
for an Eligible Operator Loan have not been met and (c) which is
assigned to the Agent for the benefit of the Banks as Collateral
for the Loans pursuant to a Collateral Assignment of Operator Loan
Documents and as to which the Agent for the benefit of the Banks
has been granted a security interest pursuant to the Security
Agreement or any Security Agreement Amendment.
"Default under ERISA" means: (a) the occurrence or
existence of a material Accumulated Funding Deficiency in respect
of any Employee Benefit Plan within the scope of Section 302(a) of
ERISA, or (b) any failure by Borrower or any Subsidiary to make a
full and timely payment of premiums required by Section 4001 of
ERISA in respect of any Employee Benefit Plan, or (c) the
occurrence or existence of any material liability under Section
4062, 4063, 4064, 4069, 4201, 4217 or 4243 of ERISA in respect of
any Employee Benefit Plan, or (d) the occurrence or existence of
any material breach of any other law or regulation in respect of
any such Employee Benefit Plan, or (e) the institution or existence
of any action for the forcible termination of any such Employee
Benefit Plan which is within the scope of Section 4001(a)(3) or
(15) or ERISA.
"Default" means an event, condition or thing which
constitutes, or which with the lapse of time, lapse of any
applicable grace period or with the giving of notice or both would
constitute, an Event of Default referred to in Article VI which has
not been appropriately waived in writing in accordance with this
Agreement or fully corrected prior to becoming an actual Event of
Default.
"Dollars" and the sign "$" each means lawful money of the
United States.
"Eligible Operator Lease" means, as of the date of any
Borrowing Base Report including the Initial Borrowing Base Report,
each Operator Lease listed on such Borrowing Base Report, with
respect to which:
(a) the Health Care Facility related thereto constitutes a
Qualified Investment,
(b) in the case of an Operator Lease listed on the Initial
Borrowing Base Report, the Borrower (I) has delivered to the Agent
on or before the Closing Date all documents, filings and
certifications required by Section 3.02, each of which delivered
documents and filings is consistent with the Required Documentation
Standards or (II) where permitted, has set forth on the
Supplemental Schedule such documents or filings which have not been
delivered to the Agent or which are not in compliance with Section
3.02,
(c) in the case of an Operator Lease not listed on the Initial
Borrowing Base Report which is listed on any Borrowing Base Report
after the Closing Date, the Borrower has delivered to the Agent, at
least fifteen (15) Business Days prior to the date of such
Borrowing Base Report, all documents, filings and certifications
required by Section 3.03, each of which documents is consistent
with the Required Documentation Standards,
(d) in the case of (I) an Operator Lease listed on the Initial
Borrowing Base Report, to the best knowledge of Borrower based upon
the financial information provided to Borrower by the Operator, the
aggregate net worth of the Operator and any Guarantor of such
Operator's obligations to Borrower with respect to such related
Health Care Facility is a positive number and (II) an Operator
Lease not listed on the Initial Borrowing Base Report which is
listed on any Borrowing Base Report after the Closing Date, the
aggregate net worth of the Operator and any Guarantor of such
Operator's obligations to the Borrower with respect to such Health
Care Facility is a positive number,
(e) neither the Operator nor any Guarantor of the Operator's
obligations to Borrower (if any) is the subject of an Insolvency
Action and, to the best of Borrower's knowledge, based upon the
financial information provided by the Operator, the Operator and
each such Guarantor is Solvent after giving effect to the Operator
Lease and the Guaranty thereof,
(f) in the case of (I) an Operator Lease listed on a Borrowing
Base Report delivered after the Closing Date which Operator Lease
was not listed on the Initial Borrowing Base Report and (II) solely
to the extent previously received by the Borrower in the case of an
Operator Lease listed on the Initial Borrowing Base Report, the
obligations of the Operator related to any such Operator Lease are
secured to the Borrower by either (x) a stand-by letter of credit
in favor of the Borrower or a perfected pledge of cash collateral
in an amount equal to not less than the sum of two and one-half
percent (2-1/2%) of the aggregate lease payments due under the
Operator Lease Documents of such Operator or (y) a Guaranty in
favor of the Borrower,
(g) to the best of the Borrower's knowledge, the Operator is
not involved in material litigation not adequately reserved for on
the books of such Operator (as determined in a manner consistent
with generally accepted accounting principles),
(h) in case of an Operator Lease listed on any Borrowing Base
Report delivered after the Closing Date, after giving effect to the
addition of such Operator Lease to the Borrowing Base Assets the
aggregate Asset Value of all Borrowing Base Assets comprised of
Health Care Facilities which are psychiatric hospitals is not
greater than twenty percent (20%) of the aggregate Asset Value of
all Borrowing Base Assets,
(i) in the case of an Operator Lease listed on any
Borrowing Base Report the inclusion of such Operator Lease as a
Borrowing Base Asset does not cause the occurrence of a Default or
an Event of Default,
(j) in the case of an Operator Lease listed on the
Initial Borrowing Base Report, each of the statements and each of
the calculations made in the certificate of an officer of the
Borrower delivered pursuant to Section 3.02(a)(xiv) is, to the best
of such officer's knowledge, true and correct and does not fail to
state any material fact,
(k) in the case of an Operator Lease listed on a
Borrowing Base Report delivered after the Closing Date which
Operator Lease was not listed on the Initial Borrowing Base Report,
each of the statements made to the Agent in the summary delivered
pursuant to Section 3.03(a)(xvi) and each of the statements and
each of the calculations made in the certificate of an officer of
the Borrower delivered pursuant to Section 3.03(a)(xvii) are, to
the best of such officer's knowledge, true and correct and do not
fail to state any material fact,
(l) upon the filing of the Borrower Mortgage, the
Collateral Assignment of Operator Lease Documents and the financing
statements required by Section 3.02(c) or 3.03(c), as the case may
be, the Agent for the benefit of the Banks has a first priority
security interest in the Borrower Fee Property and Operator Lease
referenced therein subject only to the Liens permitted by Section
5.04(e),
(m) the Operator Lease Documents in respect of such
Operator Lease (i) are assignable by the Borrower pursuant to their
terms and (ii) are enforceable against the Borrower and the
Operator in accordance with their terms, subject to any applicable
insolvency, bankruptcy, avoidance, reorganization, moratorium and
similar laws of general applicability affecting the rights of
creditors generally, general principles of equity (other than
equitable defenses of the Operator arising by reason of the actions
of the Borrower) and any limitations imposed by standards of
commercial reasonableness, good faith and fair dealing,
(n) each of the Borrower and, to the best of the
Borrower's knowledge, the Operator is in compliance with all
material terms of the Operator Lease Documents with respect to such
Operator Lease and no condition exists which, with or without the
passage of time or the giving of notice or both, would constitute
a default by the Borrower or, to the best of the Borrower's
knowledge, the Operator in any material respect thereunder,
(o) there is no obligation of the Operator to the
Borrower as to which, in whole or in part, the Operator has
asserted any claim of setoff, counterclaim, defense or right of
recoupment, or right to any reduction or disallowance for any
reason or which is currently subject to any asserted dispute,
(p) the Operator Lease and the Borrower Fee Property in
respect thereof, free and clear of all Liens except as expressly
permitted by Section 5.04(e),
(q) the Borrower does not have any reasonable basis to
believe that the Operator will not perform its material obligations
under the Operator Lease Documents.
"Eligible Operator Loan" means, as of the date of any
Borrowing Base Report including the Initial Borrowing Base Report,
each Operator Loan listed on such Borrowing Base Report with
respect to which:
(a) the Health Care Facility related thereto constitutes a
Qualified Investment,
(b) in the case of an Operator Loan listed on the Initial
Borrowing Base Report, the Borrower (I) has delivered to the Agent
on or before the Closing Date all documents, filings and
certifications required by Section 3.02, each of which delivered
documents and filings is consistent with the Required Documentation
Standards or (II) where permitted, has set forth on the
Supplemental Schedule such documents or filings which have not been
delivered to the Agent or which are not in compliance with Section
3.02,
(c) in the case of an Operator Loan not listed on the Initial
Borrowing Base Report which is listed on any Borrowing Base Report
after the Closing Date, the Borrower has delivered to the Agent, at
least fifteen (15) Business Days prior to the date of such
Borrowing Base Report, all documents, filings and certifications
required by Section 3.03, each of which documents is consistent
with the Required Documentation Standards,
(d) in the case of (I) an Operator Loan listed on the Initial
Borrowing Base Report, to the best knowledge of Borrower, based
upon the financial information provided to Borrower by the
Operator, the aggregate net worth of the Operator and any Guarantor
of the obligations of such Operator to the Borrower with respect to
such related Health Care Facility is a positive number and (II) an
Operator Loan not listed on the Initial Borrowing Base Report which
is listed on any Borrowing Base Report after the Closing Date, the
aggregate net worth of the Operator and any Guarantor of the
obligations of such Operator to the Borrower with respect to such
related Health Care Facility is a positive number and the net worth
of the Operator of such related Health Care Facility is a positive
number,
(e) neither the Operator nor any Guarantor of the Operator's
obligations to Borrower (if any) is the subject of an Insolvency
Action and, to the best of Borrower's knowledge based upon the
financial information provided by the Operator, the Operator and
each such Guarantor is Solvent after giving effect to the Operator
Loan and the Guaranty thereof,
(f) in the case of (I) an Operator Loan listed on a Borrowing
Base Report delivered after the Closing Date which Operator Loan
was not listed on the Initial Borrowing Base Report and (II) solely
to the extent previously received by the Borrower in the case of
any Operator Loan listed on the Initial Borrowing Base Report, the
obligations of the Operator related to any such Operator Loan are
secured to the Borrower by either (x) a stand-by letter of credit
in favor of the Borrower or a perfected pledge of cash collateral
in an amount equal to not less than the sum of two and one-half
percent (2-1/2%) of the aggregate principal and interest payments
due under the Operator Loan Documents of such Operator or (y) a
Guaranty in favor of the Borrower,
(g) to the best of the Borrower's knowledge, the Operator is
not involved in material litigation not adequately reserved for on
the books of such Operator (as determined in a manner consistent
with generally accepted accounting principles),
(h) in case of an Operator Loan listed on any Borrowing Base
Report delivered after the Closing Date, after giving effect to the
addition of such Operator Loan to the Borrowing Base Assets the
aggregate Asset Value of all Borrowing Base Assets comprised of
Health Care Facilities which are psychiatric hospitals is not
greater than twenty percent (20%) of the aggregate Asset Value of
all Borrowing Base Assets,
(i) in the case of an Operator Loan listed on any Borrowing
Base Report, the inclusion of such Operator Loan as a Borrowing
Base Asset does not cause the occurrence of a Default or an Event
of Default,
(j) such Operator Loan is not a construction loan,
(k) in the case of an Operator Loan listed on the Initial
Borrowing Base Report, each of the statements and each of the
calculations made in the certificate of an officer of the Borrower
delivered pursuant to Section 3.02(a)(xiv) is, to the best of such
officer's knowledge, true and correct and does not fail to state
any material fact,
(l) in the case of an Operator Loan listed on a Borrowing Base
Report delivered after the Closing Date and not listed on the
Initial Borrowing Base Report, each of the statements made to the
Agent in the summary delivered pursuant to Section 3.03(b)(xv) and
each of the statements and each of the calculations made in the
certificate of an officer of the Borrower delivered pursuant to
Section 3.03(b)(xvi) are, to the best of such officer's knowledge,
true and correct and do not fail to state any material fact,
(m) upon the filing of the Collateral Assignment of Operator
Loan Documents and the financing statements required by Section
3.02(c) or 3.03(c), as the case may be, the Agent for the benefit
of the Banks has a first priority security interest in the Operator
Loan Documents referenced therein subject only to the Liens
permitted by Section 5.04(e),
(n) each Lien granted to the Borrower in connection with such
Operator Loan is a valid and enforceable first priority Lien except
for the Liens permitted by the related Operator Loan Documents and
Section 5.04(e),
(o) the Assigned Title Policy with respect to such Operator
Loan: (i) is in full force and effect, (ii) is freely assignable
and (subject to the issuance of a separate policy or endorsement
and the recordation of the Collateral Assignment of Operator Loan
Documents) inures to the benefit of the Agent for the benefit of
the Banks and (iii) has not been subject to any claim made under
such Assigned Title Policy since the time of issuance of the
original title policy in favor of the Borrower,
(p) the Borrower has no actual knowledge of any Lien not shown
by the public records, the existence of which would be the basis
for an exclusion from coverage under any such Assigned Title
Policy,
(q) the Operator Loan Documents in respect of such Operator
Loan: (i) are assignable by the Borrower pursuant to their terms,
(ii) are enforceable against the Borrower and the Operator in
accordance with their terms, subject to insolvency, bankruptcy,
avoidance, reorganization, moratorium, or similar laws of general
applicability affecting the rights of creditors generally and
general principles of equity (other than equitable defenses of the
Operator arising by reason of the actions of the Borrower), and any
limitations imposed by standards of commercial reasonableness, good
faith and fair dealing, (iii) contain customary and enforceable
default and remedial provisions such that the holder may timely
enforce the rights and exercise the remedies set forth in such
documents and realize the material benefits thereof and (iv) do not
provide for the cross-collateralization of such Operator Loan with
any other Operator Loan unless each such other Operator Loan is (A)
also an Eligible Operator Loan or (B) if such other Operator Loan
is not an Eligible Loan, such other Operator Loan is a Cross-
Collateralized Operator Loan,
(r) each of the Borrower and, to the Borrower's best
knowledge, the Operator is in compliance with all material terms of
the Operator Loan Documents with respect to such Operator Loan and
no condition exists which, with or without the passage of time or
the giving of notice or both, would constitute a default by the
Borrower or, to the best knowledge of the Borrower, the Operator,
in any material respect thereunder,
(s) there is no obligation of the Operator to the Borrower as
to which, in whole or in part, the Operator has asserted any claim
of setoff, counterclaim, defense or right of recoupment, or right
to any reduction or disallowance for any reason or which is
currently subject to any asserted dispute,
(t) the proceeds of such Operator Loan have been fully
disbursed and there is no requirement for future advances
thereunder,
(u) the Borrower (i) is the sole holder of the Operator Loan
Documents in respect of such Operator Loan and (ii) has full right
and authority to assign such Operator Loan, free and clear of all
Liens except as expressly permitted by Section 5.04(e), and
(v) the Borrower does not have any reasonable basis to believe
that the Operator will not perform its material obligations under
the Operator Loan Documents.
"Eligible Operator Lease Documents" means any and all
documents assigned to the Agent for the benefit of the Banks in
connection with an Eligible Operator Lease, including, without
limitation, any letter of credit issued or Guaranty executed in
favor of the Borrower.
"Eligible Operator Loan Documents" means each note, loan
agreement, mortgage and other document executed and/or delivered to
the Borrower by an Operator in respect of any Eligible Operator
Loan.
"Employee Benefit Plan" means an "employee benefit plan"
as defined in section 3(3) of ERISA of the Borrower, any Subsidiary
of the Borrower or any of their ERISA Affiliates.
"Environmental Claims" means any and all administrative,
regulatory or judicial actions, suits, demands, demand letters,
claims, complaints, liens, notices of non-compliance, requests for
information, investigations, proceedings, consent orders or consent
agreements relating in any way to any Environmental Law or any
Environmental Permit, instituted by any Person, including, without
limitation, (a) by governmental or regulatory authorities for
enforcement, cleanup, removal, response, remedial or other actions
or damages pursuant to any applicable Environmental Law or (b) by
any third party seeking damages, contribution, indemnification,
cost recovery, compensation or injunctive relief resulting from
Hazardous Materials or arising from alleged injury or threat of
injury to health or the environment.
"Environmental Laws" means any federal, state or local
law, regulation, ordinance, or order pertaining to the protection
of the environment and the health and safety of the public,
including (but not limited to) the Comprehensive Environmental
Response, Compensation and Liability Act ("CERCLA"), 42 USC Sections 9601
et seq.; the Resource Conservation and Recovery Act ("RCRA"), 42
USC Sections 6901 et seq.; the Hazardous Materials Transportation Act, 49
USC Sections 1801 et seq.; the Federal Water Pollution Control Act (33
USC Sections 1251 et seq.), the Toxic Substances Control Act (15 USC Sections
2601 et seq.) and the Occupational Safety and Health Act (29 USC Sections
651 et seq.), and all similar state, regional or local laws,
treaties, regulations, statutes or ordinances, common law, civil
laws, or any case precedents, rulings, requirements, directives or
requests having the force of law of any foreign or domestic
governmental authority, agency or tribunal, and all foreign
equivalents thereof, as the same have been or hereafter may be
amended, and any and all analogous future laws, treaties,
regulations, statutes or ordinances, common law, civil laws, or any
case precedents, rulings, requirements, directives or requests
having the force of law of any foreign or domestic governmental
authority, agency or tribunal and the regulations promulgated
pursuant thereto, which governs: (i) the existence, cleanup and/or
remedy of contamination on property; (ii) the emission or discharge
of Hazardous Materials into the environment; (iii) the control of
hazardous wastes; (iv) the use, generation, transport, treatment,
storage, disposal, removal or recovery of Hazardous Materials; or
(v) the maintenance and development of wetlands.
"Environmental Permits" means all permits, approvals,
certificates, notifications, identification numbers, licenses and
other authorizations required under any applicable Environmental
Laws or necessary for the conduct of business.
"ERISA" means the Employee Retirement Income Security Act
of 1974 (Public Law 93-406), as amended, and in the event of any
amendment affecting any section thereof referred to in this
Agreement, that reference shall be a reference to that section as
amended, supplemented, replaced or otherwise modified.
"ERISA Affiliate" of any Person means any other Person
that for purposes of Title IV of ERISA is a member of such Person's
controlled group, or under common control with such Person, within
the meaning of Section 414 of the Internal Revenue Code of 1986, as
amended from time to time.
"ERISA Regulator" means any governmental agency (such as
the Department of Labor, the Internal Revenue Service and the
Pension Benefit Guaranty Corporation) having any regulatory
authority over any Employee Benefit Plan.
"Eurocurrency Liabilities" has the meaning assigned to
that term in Regulation D of the Board of Governors of the Federal
Reserve System, as in effect from time to time.
"Eurocurrency Reserve Percentage" of any Bank for the
Interest Period for any LIBOR Rate Loan means the reserve
percentage applicable during such Interest Period (or if more than
one such percentage shall be so applicable, the daily average of
such percentages for those days in such Interest Period during
which any such percentage shall be so applicable) under regulations
issued from time to time by the Board of Governors of the Federal
Reserve System (or any successor) for determining the maximum
reserve requirement (including, without limitation, any emergency,
supplemental or other marginal reserve requirement) for such Bank
with respect to liabilities or assets consisting of or including
Eurocurrency Liabilities having a term equal to such Interest
Period.
"Event of Default" has the meaning specified in Section
6.01.
"Federal Funds Rate" shall mean, for any day, the average
of the rates on overnight Federal funds transactions with members
of the Federal Reserve System arranged by Federal funds brokers, as
published on the next succeeding Business Day by the Federal
Reserve Bank of Cleveland, or, if such rate is not so published for
any day that is a Business Day, the average of the quotations for
the day of such transactions received by the Agent from three (3)
Federal funds brokers of recognized standing selected by it.
"Fee Letter" means the Fee Letter, dated February 23,
1994, between the Borrower and the Agent, as the same may be
amended or modified from time to time.
"Fiscal Quarter" means any of the four consecutive three-
month fiscal accounting periods collectively forming a Fiscal Year
of the Borrower.
"Fiscal Year" means the Borrower's regular annual
accounting period for federal income tax purposes ending December
31.
"Flood Disaster Act" has the meaning specified in Section
3.02(a)(viii).
"Guarantor" means one who pledges his credit or property
in any manner for the payment or other performance of the
Indebtedness, contract or other obligation of another, including,
without limitation, any guarantor (whether of collection or
payment), any obligor in respect of a standby letter of credit or
surety bond issued for the obligor's account, and surety, any co-
maker, any endorser, and anyone who agrees conditionally or
otherwise to make any loan, purchase or investment in order thereby
to enable another to prevent or correct a default of any kind.
"Guaranty" means the obligation of a Guarantor.
"Guaranty Agreement" means a Guaranty Agreement,
substantially in the form of Exhibit J hereto, executed or to be
executed by a Subsidiary of the Borrower.
"Hazardous Material" means and includes (i) any asbestos
or other material composed of or containing asbestos which is, or
may become, even if properly managed, friable, (ii) petroleum and
any petroleum product, including, without limitation, crude oil,
diesel fuel, gasoline, oil, fuel oil and petroleum solvents or any
distillate fraction thereof, and natural gas or synthetic natural
gas liquids or mixtures thereof; (iii) any hazardous, toxic or
dangerous waste, substance or material defined as such in (or for
purposes of) CERCLA or RCRA, any so-called "Superfund" or
"Superlien" law, or any other applicable Environmental Laws, and
(iv) any other substance whose generation, handling, transporta-
tion, treatment or disposal is regulated pursuant to any
Environmental Laws.
"Health Care Facility" means any nursing home, retirement
center, hospital, psychiatric hospital, assisted living facility,
rehabilitation facility, medical facility, other primary care
facility and any other similar facility.
"Indebtedness" means, with respect to any Person, without
duplication, (i) indebtedness for borrowed money, (ii) obligations
to pay the deferred purchase price of property or services, (iii)
obligations as lessee under leases which shall have been or should
be, in accordance with generally accepted accounting principles,
recorded as capital leases, (iv) all obligations of such Person as
an account party in respect of letters of credit or banker's
acceptances, (v) liabilities in respect of unfunded vested benefits
under plans covered by Title IV of ERISA, (vi) obligations secured
by any Lien on the properties or assets of the Person, (vii)
obligations of such Person in respect of currency or interest rate
swap or comparable transactions and (viii) obligations under direct
or indirect Guaranties in respect of, and obligations (contingent
or otherwise) to purchase or otherwise acquire, or otherwise to
assure a creditor against loss in respect of, indebtedness or
obligations of others of the kinds referred to in clauses (i)
through (vii) above.
"Initial Borrowing Base Report" has the meaning ascribed
to such term in Section 3.01(n).
"Insolvency Action" means either (a) a pleading of any
kind filed by a Person to seek relief from such Person's creditors,
or filed by such Person's creditors or any thereof to seek relief
of any kind against such Person, in any court or other tribunal
pursuant to any Law relating generally to the rights of creditors
or the relief of debtors or both or (b) any other action of any
kind commenced by a Person or such Person's creditors or any
thereof for the purpose of marshalling such Person's assets and
liabilities for the benefit of such Person's creditors (an
Insolvency Action includes, without limitation, a petition
commencing a case pursuant to any chapter of the Federal Bankruptcy
Code, any application for the appointment of a receiver, trustee,
liquidator or custodian for a Person or any substantial part of
such Person's assets, and any assignment by a Person for the
general benefit of such Person's creditors).
"Interest Period" means, for each of the LIBOR Rate Loans
comprising a Revolving Credit Borrowing, the period commencing on
the date of such Loans or the date of the Rate Conversion or Rate
Continuation of any Loans into such Loans and ending on the
numerically corresponding day of the period selected by the
Borrower pursuant to the provisions hereof and each subsequent
period commencing on the last day of the immediately preceding
Interest Period in respect of such Loans and ending on the last day
of the period selected by the Borrower pursuant to the provisions
hereof. The duration of each such Interest Period shall be one,
two, three or six months, in each case as the Borrower may select,
upon delivery to the Agent of a Credit Request therefor in
accordance with Section 2.02(c) hereof; provided, however, that:
(a) Interest Periods for Loans comprising part of the same
Revolving Credit Borrowing shall be of the same duration;
(b) with respect to LIBOR Rate Loans comprising any Revolving
Credit Borrowings, no Interest Period may end on a date later than
the Revolving Credit Termination Date;
(c) whenever the last day of any Interest Period would
otherwise occur on a day other than a Business Day, the last day of
such Interest Period shall be extended to occur on the next
succeeding Business Day; provided, however, that if such extension
would cause the last day of such Interest Period to occur in the
next following calendar month, the last day of such Interest Period
shall occur on the immediately preceding Business Day;
(d) if the Interest Period commences on a Business Day for
which there is no numerical equivalent in the calendar month in
which the Interest Period is to end, such Interest Period shall end
on the last Business Day of that calendar month; and
(e) the Borrower may not select any Interest Period ending
after the date of any mandatory reduction specified in Section
2.04(c)(iii) unless, after giving effect to such selection, the
aggregate unpaid principal amount of any then outstanding Prime
Rate Loans taken together with the principal amount of any then
outstanding LIBOR Rate Loans having Interest Periods ending on or
prior to the date of such mandatory reduction shall be at least
equal to the principal amount of the Revolving Credit Loans due and
payable on or prior to such date.
"Internal Revenue Code" means the Internal Revenue Code
of 1986, as amended from time to time.
"Law" means any federal, state, local or foreign law,
ordinance or regulation or any order, case precedent, ruling,
directive, judgment, injunction, award or decree or request having
the force of law or any other requirement of any governmental or
regulatory body, court, tribunal or arbitrator.
"Lease Value" means, with respect to any Borrower's
Balance Sheet Asset owned by the Borrower and leased to an
Operator, the contract purchase price with respect to the
acquisition of such property from the Borrower by such Operator as
set forth in the Operator Lease and Operator Lease Documents.
"Lending Office" means, with respect to any Bank, the
office of such Bank specified as its "Lending Office" below its
name on the signature pages hereto, or such other office of such
Bank as such Bank may from time to time specify in writing to the
Borrower and the Agent as the office at which Loans are to be made
and maintained.
"LIBOR Rate Loan" means a Loan which bears interest as
provided in Section 2.06(a)(ii).
"LIBOR Rate" means, for any Interest Period for each
LIBOR Rate Loan comprising part of the same Revolving Credit
Borrowing, the rate per annum (rounded upwards, if necessary, to
the next higher 1/16th of 1%) determined by the Agent to be the
average rate at which deposits in Dollars are offered to the Agent
by leading reference banks in the London interbank market at or
about 4 P.M. (London time) two (2) Business days before the first
day of such Interest Period in an amount substantially equal to the
amount of the NCB's LIBOR Rate Loan comprising part of such
Revolving Credit Borrowing, and for a period equal to such Interest
Period.
"Lien" means any lien, security interest or other charge
or encumbrance of any kind, or any other type of preferential
arrangement, including, without limitation, the lien or retained
security title of a conditional vendor and any easement, right of
way or other encumbrance on title to real property.
"Loan" means a Revolving Credit Loan by a Bank to the
Borrower pursuant to Article II and refers to a Prime Rate Loan or
a LIBOR Rate Loan.
"Majority Banks" means at any time two or more Banks
holding in the aggregate at least 66-2/3% of the then aggregate
unpaid principal amount of the Loans held by the Banks or, if no
such principal amount is then outstanding, two or more Banks having
at least 66-2/3% of the aggregate Revolving Credit Commitments.
"Management Agreement" means, that certain Management
Agreement between the Borrower and First Toledo Corporation, dated,
January 17, 1994, and assigned to the Manager effective June 1,
1994, and as thereafter amended from time to time, subject to the
limitations of Section 5.04(i).
"Manager" means First Toledo Advisory Company, an Ohio
corporation, and its successors and assigns which act as Manager
under the Management Agreement.
"Material Adverse Effect" means (a) a material adverse
effect on the business, results of operations or financial
condition of the Borrower and its Subsidiaries, on a consolidated
basis, (b) a material adverse effect on the ability of the Borrower
to perform its obligations under this Agreement, (c) a material
adverse effect on the legality, validity or enforceability of the
Borrower's obligations under this Agreement, (d) there exists a
Material Impairment of one or more Borrowing Base Assets which in
the aggregate results in a decrease in the aggregate Asset Value of
the Borrowing Base Assets in an amount greater than or equal to ten
percent (10%) of the aggregate Asset Value of the Borrowing Base
Assets and which decrease arises in connection with failure to
comply with any Environmental Law or Environmental Permit, the
assertion of an Environmental Claim or the existence of any other
environmental conditions or (e) there at any time exists a Material
Impairment of five (5) or more Operator Fee Properties or Borrower
Fee Properties; provided, however, that, the parties' agreement
that the existence of conditions identified in clauses (d) and (e)
above shall be considered to be a Material Adverse Effect shall not
preclude an assertion by the Majority Banks that any other
condition relating to environmental matters, whether with respect
to Borrowing Base Assets or otherwise, or any other condition which
exists can be deemed, in the discretion of the Majority Banks, to
be a condition giving rise to a Material Adverse Effect as
described in clauses (a), (b) or (c) of this definition.
"Material Impairment" means (a) a material adverse effect
on the condition, value, ownership, transferability or use of any
Borrowing Base Asset, (b) a decrease in the value of any Borrowing
Base Asset in an amount greater than or equal to ten percent (10%)
of the Asset Value of such asset or (c) a material impairment of
any of the Liens granted by or under the Collateral Documents or
the enforceability or priority thereof.
"Notes" means the Revolving Credit Notes, executed and
delivered by the Borrower to the Banks under this Agreement.
"Notice of Borrowing Base Addition/Removal" means a
Notice of Borrowing Base Addition/Removal in the form of Exhibit E
hereto, delivered pursuant to Sections 2.08 and 3.03.
"Obligations" means, collectively, all principal and
interest on any Loans made hereunder (including, without
limitation, all amounts which would become due but for the
operation of the automatic stay under Section 362(a) of the United
States Bankruptcy Code, 11 USC Section 362(a), and the operation of
Section 5.02(b) and 5.06(b) of the United States Bankruptcy Code,
11 USC Section 502(b) and Section 506(b)), all liabilities under any hedge
agreement, swap agreement or similar agreement between the Borrower
and any Bank, all liability of the Borrower under Article VII and
Article IX of this Agreement, and all fees and other liabilities,
payable to the Banks or the Agent or any thereof by the Borrower
pursuant to this Agreement, the Collateral Documents or any Related
Writing.
"Operator" means any Person operating any Health Care
Facility with which the Borrower has a contractual relationship
providing for such Person to enter into an Operator Loan, Operator
Lease or other similar financing relationships with the Borrower.
"Operator Affiliate" means, with respect to a specified
Operator, another Operator (a) which directly or indirectly through
one or more intermediaries controls, or is controlled by, or is
under common control with such Operator, (b) which beneficially
owns or holds with power to vote fifty percent (50%) or more of any
class of the voting stock of such Operator, (c) fifty percent (50%)
or more of the voting stock of which other Operator is beneficially
owned or held by such Operator, or (d) who has the power (whether
by contract, by proxy or otherwise) to elect a majority of such
Operator's Board of Directors. The term "control" means the
possession, directly or indirectly, of the power to direct or cause
the direction of the management and policies of a Person, whether
through the ownership of voting securities, by contract or
otherwise.
"Operator Lease" means any lease entered into between an
Operator and the Borrower with respect to any Borrower Fee
Property.
"Operator Lease Documents" means any and all documents
executed and/or delivered to the Borrower by an Operator in
connection with any Operator Lease, including, without limitation,
any subordination agreement, lessee estoppel, letter of credit
issued or Guaranty executed in favor of the Borrower.
"Operator Loan" means any loan or financing made by the
Borrower to an Operator, secured by the Operator Fee Property of
such Operator.
"Operator Loan Documents" means any and all documents
executed and/or delivered to the Borrower by an Operator in
connection with any Operator Loan, including, without limitation,
any promissory note, mortgage guaranty or letter of credit, title
commitment, title insurance, insurance certificate, environmental
audit, appraisal, survey and any documents delivered in connection
with any of the foregoing.
"Operator Fee Property" means any real property owned by
an Operator in fee simple relating to an Operator Loan.
"Other Taxes" has the meaning specified in Section
9.03(c).
"Payment Office" means such office of the Agent as set
forth under its name on the signature pages hereto or such office
as may be from time to time selected by the Agent and notified in
writing by the Agent to the Borrower and the Banks as the office to
which payments are to be made by the Borrower or the Banks, as the
case may be.
"Permitted Investments" means any investment, ownership
or other interest which a REIT is permitted to make and maintain or
derive income from pursuant to and in accordance with Section 856
of the Internal Revenue Code and the rules and regulations
promulgated thereunder.
"Person" means an individual, partnership, corporation
(including a business trust), joint stock company, trust,
unincorporated association, joint venture or other entity, or a
government or any political subdivision or agency thereof.
"Prime Rate" means, the fluctuating interest rate per
annum announced publicly by NCB in Cleveland, Ohio, from time to
time, as NCB's base rate or prime rate thereafter in effect (which
rate is not necessarily the lowest rate charged by NCB to its
borrowing customers).
"Prime Rate Loan" means a Loan which bears interest as
provided in Section 2.06(a)(i).
"Purchase Money Security Interest" has the meaning
specified in Section 5.04(e).
"Qualified Investment" means any Operator Loan or
Operator Lease with respect to which Operator Loan or Operator
Lease, the Health Care Facility related thereto or the Operator
thereof the following is true at all relevant times;
(a) the Operator of such related Health Care Facility has (i)
at least five (5) years of experience in operating a Health Care
Facility or similar health care related experience (or one of such
Operator's principals has such experience) and (ii) not defaulted
in payment under any material financing arrangement in the last
five (5) years; provided, however, that this requirement is not
satisfied with respect to the Operator of the Woodmere Health Care
Center in Southington, Connecticut (current Operator [The Mediplex
Group, Inc.] is current on payments),
(b) the Operator of such Health Care Facility has provided to
the Borrower current and historical financial statements, which
financial statements fairly present the business and results of
operations of such Operator and such Health Care Facility,
consistently applied, together with pro forma financial
information, reflecting such Operator's financial ability to repay
the financing and perform the obligations under the financing
documents; provided, however, that, the requirement of the delivery
of financial statements has not been satisfied with respect to the
following Operators of Borrowing Base Assets listed on the Initial
Borrowing Base Report: (i) Citadel Health Care Pavilion located in
St. Joseph, Missouri and (ii) The Mediplex Group, Inc. with respect
to Meridian Health Care Center located in Southington, Connecticut,
(c) such Health Care Facility is of comparable quality and
condition to the Health Care Facilities of a similar type
comprising the Borrower's Balance Sheet Assets, which quality and
condition is evaluated based upon objective standards consistently
applied and consistent with the Borrower's past practices,
(d) the Borrower has received an appraisal of such Health Care
Facility prepared and certified by a qualified M.A.I. appraiser
which appraiser has demonstrated experience in the appraisal of
Health Care Facilities and which appraisal is in substance
consistent with the Required Documentation Standards; provided,
however, that, this requirement is not satisfied with respect to
the following Borrowing Base Assets listed on the Initial Borrowing
Base Report identified in Sections 3.02(a)(xi) and 3.02(b)(vii),
(e) each Operator of such Health Care Facility obtaining
financing from the Borrower for the purchase of a Health Care
Facility has not received loan proceeds from the Borrower which,
when aggregated with all other loans made to such Operator with
respect to such Health Care Facility, exceed ninety percent (90%)
of the Appraised Value (as determined pursuant to the appraisal
meeting the requirements set forth in clause (d) of this
definition) of such Health Care Facility; provided, however, that,
this requirement is not satisfied with respect to the Health Care
Facilities with respect to the following Borrowing Base Assets
listed on the Initial Borrowing Base Report: (i) located at
Austintown, Ohio is subject to reappraisal pursuant to Section
3.02(a)(xi) and (ii) located at Southington, Connecticut has a
"loan to value ratio of 1.06 to 1.0,
(f) at the time of the making of such investment, the
financial statements of the Operator of such Health Care Facility
demonstrate that, after giving effect to a financing by the
Borrower, the ratio of the Operator's net income plus the sum of
its total Indebtedness for borrowed money (principal plus interest
plus fees) and lease expenses (including fees), income taxes and
depreciation (which calculations are reasonably consistent with
generally accepted accounting principles) to its Indebtedness for
borrowed money (principal plus interest plus fees) and lease
expenses (including fees), is not less than 1.25 to 1.0; provided,
however, that, in the event that the Operator's historical
financial statements do not demonstrate such ratio, the Borrower
may consider future increases in cash flow to the extent they are
verifiable based upon objective analysis of future events in
determining that such ratio will be met by the Operator in the
future; provided, further, that, this requirement is not satisfied
with respect to the operators of the following Borrowing Base
Assets listed on the Initial Borrowing Base Report: (i) Hutton III
Nursing Center, Inc. located in Salem, Ohio (.28 to 1.0), (ii)
Meridian Arms Living Center located in Austintown, Ohio (1.10 to
1.0), (iii) West Park Place located in Toledo, Ohio (1.09 to 1.0),
(iv) Bloomington Meadows Hospital located in Bloomington, Indiana
(.49 to 1.0) and (v) Colonial Gardens Nursing Home located in
Tallmadge, Ohio (.98 to 1.0),
(g) the Borrower (i) has completed a study of such Health Care
Facility (or proposed facility), including assessments of site
suitability as to type, geography, marketing demographics,
occupancy and barriers limiting the entry of competing facilities
into the community which study shall be consistent with the
Borrower's past practices and (ii) has confirmed the necessity of
obtaining any regulatory permits or certificates of need and that
there is a reasonable likelihood of the Operator's obtaining such
permits or certificates of need if not already obtained,
(h) the Board of Directors of the Borrower or the Investment
Committee of the Board of Directors of the Borrower has approved
the Borrower's investment in such Health Care Facility and all
other corporate or other approvals necessary for the Borrower to
consummate the transaction have been obtained,
(i) if required by the Borrower pursuant to its evaluation of
the financial stability of the Operator and the Operator's ability
to pay or repay its obligations to the Borrower, which evaluation
shall be consistent with the Borrower's past practice and
reasonable business judgment, the Operator has obtained a standby
or direct pay letter of credit or Guaranty of a financially sound
Guarantor or other third party assurance of payment in favor of the
Borrower in such amount as deemed necessary in the Borrower's
business judgment generally consistent with the Required
Documentation Standards,
(j) the Borrower has obtained such legal documents and third
party assurances in connection with the acquisition or financing of
such Health Care Facility, including, without limitation,
promissory notes, mortgages, subordination agreements, surveys,
title insurance policies, casualty insurance coverage, opinions of
legal counsel to the Operator or the Borrower, environmental audits
and other documents necessary to protect the interests of the
Borrower in transactions of the type entered into, each of which
documents is in form legally sufficient to protect the interests of
the Borrower taking into consideration the type and size of the
investment and is consistent with the form of documentation
required by prudent real estate lenders or lessors, as applicable
except to the extent set forth in the Supplemental Schedule
(Section 3.02(a) and 3.02(b)) as to Borrowing Base Assets listed on
the Initial Borrowing Base Report, and
(k) such investment is in the ordinary course of the
Borrower's business and is generally consistent with the Borrower's
past business practices.
"REIT" means a real estate investment trust.
"REMIC" means a real estate mortgage investment conduit.
"Ratable Portion" means, in respect of any Bank, the
quotient (expressed as a percentage) obtained at any time by
dividing such Bank's Revolving Credit Commitment at such time by
the aggregate amount of the Revolving Credit Commitments of all the
Banks at such time.
"Rate Continuation" means a continuation of LIBOR Rate
Loans having a particular Interest Period as LIBOR Rate Loans
having an Interest Period of the same duration pursuant to Section
2.02(h).
"Rate Conversion" refers to a conversion pursuant to
Section 2.02(h) of Loans of one Type into Loans of another Type
and, with respect to LIBOR Rate Loans, from one permissible
Interest Period to another permissible Interest Period.
"Rate Conversion/Continuation Request" means a request
for Rate Conversion or Rate Continuation in the form of Exhibit C
hereto made pursuant to Section 2.02(h).
"Rating Agency" means Standard & Poor's Corporation
("S&P") or its successor, Moody's Investors Service, Inc.
("Moody's), or its successor or Duff & Phelps ("D&P) or its
successor, or in the event that S&P, Moody's and D&P shall no
longer be nationally recognized securities rating agencies, any
other nationally recognized securities rating agency reasonably
acceptable to the Borrower and the Majority Banks.
"Receivable" means, a claim for money due or to become
due, whether classified as an account, instrument, chattel paper,
general intangible, incorporeal hereditament or otherwise, and any
proceeds of the foregoing.
"Reduction Notice" has the meaning specified in Section
2.03.
"Related Writing" means any note, mortgage, security
agreement, or other lien instrument, reimbursement agreement,
financial statement, audit report, environmental audit, notice,
Credit Request, Rate Conversion/Continuation Request, Reduction
Notice, Notice of Addition to Borrowing Base officer's certificate
or other writing of any kind which is now or hereafter required to
be delivered by or on behalf of the Borrower or any of its
Subsidiaries to the Banks and the Agent or any thereof and which is
relevant in any manner to this Agreement, including, without
limitation, the Notes, the Collateral Assignments, the Borrower
Mortgages and the other writings referred to in Article II, III or
V.
"Reportable Event" means any of the events set forth in
Section 4043 of ERISA.
"Required Documentation Standards" means the following
standards of documentation in connection with Collateral Documents
executed in favor of the Agent and Operator Leases and Operator
Loans executed in favor of the Borrower for which Eligible Operator
Loan or Eligible Operator Lease status is sought either on the
Initial Borrowing Base Report or on any subsequent Borrowing Base
Reports:
(a) with respect to all Collateral Documents executed or to
be executed in favor of the Agent for the benefit of the Banks, the
form of Borrower Mortgage, Collateral Assignment or financing
statement, shall be substantially in the form of such documents
attached to this Agreement as exhibits hereto or delivered to the
Agent on the Closing Date, with such modifications as are necessary
to (i) cause such form to comply with the filing or other legal
requirements of the jurisdiction in which such documents are to be
filed, (ii) cause such form to grant to the Agent for the benefit
of the Banks, all rights, remedies and privileges (including, any
cognovit, confession of judgment, creditor's right to non-judicial
foreclosure or non-judicial receivership or similar remedial
provisions) of a holder of a mortgage and all provisions necessary
to protect the interest of a revolving credit lender and to grant
such lender a continuing first priority security interest in real
estate and fixtures (subject to the Liens permitted by Section
5.04(d)) and (iii) cause such form to reflect specific
modifications necessary to conform such form to the real estate in
question, so long as any modification pursuant to this clause (iii)
shall not be adverse to the interest of the Agent for the benefit
of the Banks;
(b) with respect to any Operator Loan executed or to be
executed in favor of the Borrower, the form of such Operator Loan
Documents shall be substantially in the form of the Operator Loan
Documents delivered to the Agent by the Borrower and certified by
the Borrower to the Agent and the Banks as provided in Section
3.01(l) as the standard forms of documentation used by the Borrower
in connection with the Operator Loans, as reviewed by the Agent and
its counsel (and made available to the Banks upon request), with
such modifications as are necessary to (i) cause such form to
comply with the filing or other legal requirements of the
jurisdiction in which such documents are to be filed, (ii) cause
such form to grant to the Borrower, all rights, remedies and
privileges of a lender with a first priority security interest in
real estate and fixtures (subject to the Liens permitted by Section
5.04(e) and the Operator Loan Documents so reviewed) and (iii)
cause such form to reflect specific modifications necessary to
conform such form to the transaction in question, so long as any
such modification shall be reasonably necessary to accommodate the
facts applicable to the specific transaction or requested by the
Operator determined in the prudent exercise of the Borrower's
business judgment, and shall not be adverse to the interest of the
Agent for the benefit of the Banks or the security interest of the
Agent evidenced by the Collateral Assignment of Operator Loan
Documents and the Collateral Assignment of Mortgage, as the case
may be,
(c) with respect to any Borrower Fee Property and any Operator
Lease executed or to be executed in favor of the Borrower, the form
of such Operator Lease Documents shall be substantially in the form
of the Operator Loan Documents delivered to the Agent by the
Borrower and certified by the Borrower to the Agent and the Banks
as provided in Section 3.01(l) as the standard forms of
documentation used by the Borrower in connection with the Operator
Leases, as reviewed by the Agent and its counsel (and made
available to the Banks upon request), with such modifications as
are necessary to (i) cause such form to comply with the filing or
other legal requirements of the jurisdiction in which such
documents are to be filed, (ii) cause such form to grant to the
Borrower, all rights, remedies and privileges of a lessor of real
estate and fixtures (subject to the Liens permitted by Section
5.04(d) and the Operator Lease Documents so reviewed) and (iii)
cause such form to reflect specific modifications necessary to
conform such form to the transaction in question, so long as any
such modifications shall be reasonably necessary to accommodate the
facts applicable to the specific transaction or requested by the
Operator determined in the prudent exercise of the Borrower's
business judgment and shall not be adverse to the interest of the
Agent for the benefit of the Banks or the security interest of the
Agent evidenced by the Collateral Assignment of Operator Lease
Documents and the Collateral Assignment of Mortgage, as the case
may be, and
(d) with respect to the appraisals, environmental audits,
surveys, ALTA title insurance policies obtained by the Borrower
with respect to any Operator Fee Property or any Borrower Fee
Property, such documents shall be in substance consistent with the
Borrower's required documentation and due diligence as certified by
the Borrower to the Agent and the Banks as the Borrower's standards
with respect to such matters as provided in Section 3.01(l), and
satisfying any other requirements set forth in Section 3.02 and
3.03 hereof, with such modifications as do not adversely affect the
interests or Lien of the Agent or the Banks.
"Restricted Payments" shall mean (a) any dividend or
distribution in cash, property or obligations (other than in
capital stock of the Borrower or any Subsidiary of the Borrower or
in options, warrants or other securities convertible into the
capital stock of the Borrower or any Subsidiary) paid or declared
by the Borrower or any Subsidiary of the Borrower on any shares of
capital stock (now or hereafter outstanding) of the Borrower or any
Subsidiary of the Borrower or on any warrants, options or other
rights with respect to any class of capital stock (now or hereafter
outstanding) of the Borrower or any Subsidiary of the Borrower, and
(b) any application by the Borrower or any Subsidiary of the
Borrower of its funds, property or assets to the purchase,
redemption, sinking fund, or other retirement of any shares of any
class of capital stock (now or hereafter outstanding) of the
Borrower or any Subsidiary of the Borrower or warrants, options or
other rights with respect to any class of capital stock (now or
hereafter outstanding) of the Borrower or any Subsidiary of the
Borrower, and (c) any agreement by the Borrower or any Subsidiary
of the Borrower to purchase or redeem (or set aside funds to
purchase or redeem) any shares of any class of capital stock (now
or hereafter outstanding) of the Borrower or any Subsidiary of the
Borrower or any warrants, options or other rights with respect to
any class of capital stock (now or hereafter outstanding) of the
Borrower or any Subsidiary of the Borrower, and (d) any cash,
property or other obligations (other than capital stock of the
Borrower or any Subsidiary or options, warrants or other securities
convertible into the capital stock of the Borrower or any
Subsidiary) paid or payable by the Borrower or any Subsidiary of
the Borrower to the Manager or any other Person in connection with
a Special Transaction; provided that any deferred payment
obligations incurred or undertaken in connection with a Special
Transaction shall be subject to the restrictions set forth in
Section 5.04(a)(C) and 5.04(b) of this Agreement at the time such
obligations are paid and not taken at the time such obligations are
incurred or undertaken.
"Revolving Credit Borrowing" means a group of Revolving
Credit Loans of a single Type, made by the Banks on a single date
and as to which a single Interest Period is in effect (i.e. any
group of Revolving Credit Loans made by the Banks having a
different Type, or having a different Interest Period (regardless
of whether such Interest Period commences on the same date as
another Interest Period), or made on a different date shall be
considered to comprise a different Revolving Credit Borrowing).
"Revolving Credit Commitment" means, with respect to each
Bank, the Revolving Credit Commitment of such Bank as set forth
opposite such Bank's name on Schedule I hereto (as such Revolving
Credit Commitment may be reduced pursuant to Section 2.03).
"Revolving Credit Loans" means the revolving credit loans
made by the Banks to the Borrower pursuant to Section 2.02.
"Revolving Credit Note" means a promissory note of the
Borrower payable to the order of any Bank, in substantially the
form of Exhibit A hereto, evidencing the aggregate indebtedness of
the Borrower to such Bank outstanding under the Revolving Credit
Loans made by such Bank.
"Revolving Credit Termination Date" means March 31, 1997,
or the earlier date of the termination in whole of the aggregate
amount of the Revolving Credit Commitments pursuant to Section 2.03
or 6.02.
"Security Agreement" means the Security Agreement
(General Intangibles) in the form of Exhibit L-1 hereto.
"Security Agreement Amendment" means an Amendment [No.
__] to Security Agreement (General Intangibles) substantially in
the form of Exhibit L-2 hereto.
"Senior Note Documents" means, that certain Note Purchase
Agreement, dated as of April 8, 1993, among the Borrower and
certain purchasers named therein, the Senior Notes and that certain
Collateral Agency Agreement, dated as of April 8, 1993, among the
Borrower, certain purchasers named therein and the Collateral Agent
named therein.
"Senior Notes" means, those certain unsubordinated notes
in the aggregate original principal amount of Fifty-Two Million
Dollars ($52,000,000), issued by the Borrower pursuant to that
certain Note Purchase Agreement, dated as of April 8, 1993, among
the Borrower and certain purchasers named therein, consisting of
the 7.16% Series A Senior Notes due 1998, in the aggregate
principal amount of Twenty-Two Million Dollars ($22,000,000), the
7.71% Series B Senior Notes due 2000, in the aggregate principal
amount of Fifteen Million Dollars ($15,000,000) and the 8.24%
Series C Senior Notes due 2003, in the aggregate principal amount
of Fifteen Million Dollars ($15,000,000).
"Solvent" means, with respect to any Person, that (i) the
present fair saleable value of the Person's assets is, as at the
date of any determination, greater than the amount that will be
required to pay the Person's probable liability on such Person's
debts as they become absolute and matured (as interpreted in
accordance with the Uniform Fraudulent Conveyances Act as enacted
by any State applicable to the Person or the Person's assets), (ii)
the fair valuation of the "assets" (as defined below) of the Person
is, as at the date of any determination, greater than the sum of
the liabilities of the Person on any "claim" (as defined below) (as
interpreted in accordance with Title 11 of the United States Code
or the Uniform Fraudulent Transfer Act as enacted in any State
applicable to the Person or the Person's assets, as the case may
be), (iii) as of the date of any determination, the Person is able
to pay all liabilities of the Person as those liabilities mature,
and (iv) the Person does not have unreasonably small capital for
the business in which it is engaged or for any business or
transaction in which it is about to engage. For the purposes of
this definition the following words have the following meanings:
"assets" means "property" (as defined below) of a Person, but does
not include (x) property to the extent it is encumbered by a valid
Lien, (y) property to the extent it is generally exempt under
applicable nonbankruptcy law or (z) an interest in property held in
the form of a tenancy by the entireties created under applicable
Law to the extent it is not subject to process by a creditor
holding a claim against only one tenant; "claim" means a right to
payment, whether or not the right is reduced to judgment,
liquidated, unliquidated, fixed, contingent, matured, unmatured,
disputed, undisputed, legal, equitable, secured or unsecured;
"property" means anything that may be the subject of ownership.
"Special Transaction" shall mean a transaction or series
of transactions the purpose of which shall be to restructure the
Borrower as a self-administered REIT as permitted by Section
5.04(a)(C).
"Subsidiary" means a corporation or other business entity
if shares constituting a majority of its outstanding capital stock
(or other form of ownership) or constituting a majority of the
voting power in any election of directors (or shares constituting
both majorities) are (or upon the exercise of any outstanding
warrants, options or other rights would be) owned directly or
indirectly at the time in question by the corporation in question
or another subsidiary of that corporation or any combination of the
foregoing.
"Supplemental Schedule" means the schedule incorporated
into this Agreement as Schedule IV hereto.
"Taxes" has the meaning specified in Section 9.03(a).
"Title Company" means Lawyers Title Insurance Corporation
or such other national title insurance underwriter of similar
financial strength and reputation.
"Type" means, when used in respect of any Loan, the LIBOR
Rate or Prime Rate applicable to such Loan.
"UCC" means the Uniform Commercial Code as adopted by the
State of Ohio, as amended from time to time.
"United States" and "U.S." each means United States of
America.
"Wholly-Owned Subsidiary" means a corporation or other
business entity, organized under the laws of the United States, if
shares constituting one hundred percent (100%) of its outstanding
capital stock (or other form of ownership) are owned directly at
the time in question by the Borrower.
SECTION 1.02 Computation of Time Periods. In this
Agreement, for the purposes of computing periods of time from a
specified date to a later specified date, the word "from" means
"from and including" and the words "to" and "until" each means "to
but excluding".
SECTION 1.03 Accounting Terms. All accounting and
financial terms not specifically defined herein shall be construed
in accordance with generally accepted accounting principles as in
effect from time to time; provided, however, that, notwithstanding
any change in accounting procedures permitted by Section 5.04(h),
for purposes of determining the Borrower's compliance with any
covenant set forth in Section 5.05, such terms shall be construed
in accordance with generally accepted accounting principles as in
effect on the date of this Agreement and in all cases shall be
applied on a basis consistent with those applied in the preparation
of the audited financial statements referred to in Section 4.09.
SECTION 1.04 Treatment of Subordinated Convertible Debt.
In the event that the Borrower contemplates the issuance of
subordinated convertible debt and delivers to each of the Banks a
written notice requesting that such subordinated convertible debt
not be considered as reducing the Borrower's net worth for the
purposes of Sections 5.05(a), (c) and (d) and including the term
sheet detailing the terms of such debt, the Banks agree as follows:
(i) each Bank shall review such term sheet and respond to such
request within thirty (30) calendar days of the receipt thereof,
(ii) each such Bank shall approve treating such subordinated
convertible debt as not reducing the Borrower's net worth if such
Bank determines, in the exercise of its reasonable credit judgment,
that such debt satisfies the Bank's credit requirements in effect
at the time of such request for treating debt as equity, including,
without limitation, (x) such debt's term expires after the date of
expiration of this Agreement, (y) such debt is fully subordinated
to the rights of the Banks hereunder as to payment and rights of
action and otherwise contains terms and conditions satisfactory to
each of the Banks in the reasonable exercise of its credit judgment
and (z) such debt is fully convertible to common stock of the
Borrower. Except if two (2) or more of the Banks do not approve
the treating of such subordinated convertible debt as not reducing
the Borrower's net worth, then, for the purposes of determining the
Borrower's compliance with Sections 5.05(a), (c) and (d), such
subordinated convertible debt shall be treated as equity and shall
not reduce the Borrower's net worth. Each of the Borrower, the
Banks and the Agent agrees that if any Bank does not respond to a
request complying with the terms of this Section 1.04 within thirty
(30) calendar days of the receipt of such request such Bank shall
be deemed to have denied such request.
ARTICLE II
AMOUNTS AND TERMS OF THE LOANS
SECTION 2.01 The Facility.
(a) Summary. Subject to the terms and conditions set forth in
this Agreement, the Banks are hereby establishing a facility
pursuant to which Loans will be available to the Borrower on a
revolving credit basis in the aggregate amount of One Hundred Fifty
Million Dollars ($150,000,000).
(b) Purpose of the Facility. The Borrower shall use the
proceeds of Loans hereunder for (i) the acquisition of fee simple
interests in Health Care Facilities, (ii) the funding or
acquisition of Health Care Facility loans and mortgages and (iii)
the acquisition of interests in health care related REMICs.
SECTION 2.02 The Revolving Credit Loans.
(a) Revolving Credit Loans. Subject to the terms and
conditions set forth in this Agreement, each Bank severally agrees
to make Loans on a revolving credit basis (the "Revolving Credit
Loans") to the Borrower from time to time, from the date hereof to
the Revolving Credit Termination Date, in an aggregate outstanding
amount not to exceed at any time the lesser of (a) an amount equal
to such Bank's Ratable Portion of the Borrowing Base or (b) the
Revolving Credit Commitment of such Bank. Within the limits set
forth herein, the Borrower may borrow, prepay pursuant to Section
2.04(b), and reborrow Revolving Credit Loans.
(b) Revolving Credit Borrowings. Each Revolving Credit
Borrowing shall be (i) with respect to Prime Rate Loans, in an
aggregate amount not less than One Million Dollars ($1,000,000), or
any multiple thereof and (ii) with respect to LIBOR Rate Loans, in
an aggregate amount not less than Three Million Dollars
($3,000,000) or multiples of One Million Dollars ($1,000,000) in
excess thereof. The Borrower shall be entitled to have more than
one Revolving Credit Borrowing outstanding at one time; provided,
however, that the Borrower shall not be entitled to request any
Revolving Credit Borrowing which would result in any Bank's having
an aggregate of more than ten (10) LIBOR Rate Loans outstanding at
any one time.
(c) Credit Requests. Revolving Credit Loans comprising a
Revolving Credit Borrowing shall be made upon request given by the
Borrower to the Agent not later than 12:00 noon (Cleveland time)
(i) on the day which is one (1) Business Day prior to the requested
date of a proposed Revolving Credit Borrowing comprised of Prime
Rate Loans (the initial Loans must consist entirely of Prime Rate
Loans unless, in the event of a request by the Borrower, each of
the Banks shall otherwise agree that such Loans may be LIBOR Rate
Loans) and (ii) not later than four (4) Business Days prior to the
requested date of a proposed Revolving Credit Borrowing comprised
of LIBOR Rate Loans. Each such request (a "Credit Request") for a
Revolving Credit Borrowing shall be transmitted by the Borrower to
the Agent by telecopier, telex or cable (in the case of telex or
cable, confirmed in writing to the Agent prior to the date of the
requested Revolving Credit Borrowing), in substantially the form of
Exhibit B hereto, specifying therein the requested (A) date of the
Revolving Credit Loans comprising such Revolving Credit Borrowing,
(B) Type of Revolving Credit Loans comprising such Revolving Credit
Borrowing, (C) the name of the bank and the account number to which
such funds are to be disbursed, (D) aggregate amount of such
Revolving Credit Loans and (E) in the case of a proposed Revolving
Credit Borrowing comprised of LIBOR Rate Loans, the initial
Interest Period for such LIBOR Rate Loans. Together with each
Credit Request, the Borrower shall deliver to the Agent a copy of
the Borrowing Base Report as of such date. Each Credit Request
shall be irrevocable and binding on the Borrower and subject to the
indemnification provisions of Article IX. The Agent shall give to
each Bank prompt notice on the day received of each such Credit
Request by telecopier, telex or cable.
(d) Revolving Credit Notes. Each Bank's Revolving Credit
Loans shall be evidenced at all times by a Revolving Credit Note
executed and delivered by the Borrower, payable to the order of
such Bank in a principal amount equal to the Dollar amount of such
Bank's Revolving Credit Commitment in effect at the execution and
delivery of such Bank's Revolving Credit Note. Whenever the
Borrower shall obtain a Revolving Credit Borrowing, each Bank shall
endorse an appropriate entry on such Bank's Revolving Credit Note
or make an appropriate entry in a loan account in such Bank's books
and records, or both, to evidence such Bank's Revolving Credit
Loans comprising part of a Revolving Credit Borrowing. Each entry
on such Bank's Revolving Credit Note or in such Bank's books and
records shall be presumptive evidence of the data entered. Such
entries shall not be a condition to the Borrower's obligation to
pay the Obligations as provided herein.
(e) Banks to Fund Agent. Each Bank shall, before 1:00 P.M.
(Cleveland time) on the date of each Revolving Credit Borrowing,
make available to the Agent, in immediately available funds at the
account of the Agent maintained at the Payment Office as shall have
been notified by the Agent to the Banks prior to such date, such
Bank's Ratable Portion of the Revolving Credit Loans comprising
such Revolving Credit Borrowing. On the date requested by the
Borrower for a Revolving Credit Borrowing, after the Agent's
receipt of the funds representing a Bank's Ratable Portion of such
Revolving Credit Borrowing in accordance with this Section or
Section 2.02(f) and upon the Borrower's fulfillment of the
applicable conditions set forth in Article III, the Agent will make
the funds of such Bank available to the Borrower by disbursing such
funds to the credit of the Borrower's account at such bank and to
such account as indicated in the Credit Request.
(f) Availability of Funds. Unless the Agent shall have
received notice from a Bank prior to the date of any Revolving
Credit Borrowing that such Bank will not make available to the
Agent such Bank's Ratable Portion of the Revolving Credit
Borrowing, the Agent may assume that such Bank has made its Ratable
Portion of the Revolving Credit Borrowing available to the Agent on
the date of the Revolving Credit Borrowing in accordance with
Sections 2.02(a) and 2.02(e). In reliance upon such assumption,
the Agent may, but shall not be obligated to, make available to the
Borrower on such date a corresponding portion of the Revolving
Credit Borrowing. If and to the extent that such Bank shall not
have made available to the Agent its Ratable Portion of the Loan to
be made as to the Revolving Credit Borrowing, such Bank and the
Borrower severally agree to repay to the Agent, promptly upon
demand, the corresponding portion of the Revolving Credit
Borrowing, together with interest thereon, for each day from the
date such amount is made available to the Borrower until the date
such amount is repaid to the Agent (i) in the case of the Borrower,
at the interest rate applicable at the time to Revolving Credit
Loans comprising such Revolving Credit Borrowing and (ii) in the
case of any Bank (to the extent the Borrower has not paid interest
pursuant to clause (i)), at the Federal Funds Rate. If such Bank
shall repay to the Agent such corresponding portion of the
Revolving Credit Borrowing, the amount so repaid shall constitute
such Bank's Ratable Portion as part of such Revolving Credit
Borrowing.
(g) Failure of Bank to Loan. The failure of any Bank to make
the Loan to be made by it as its Ratable Portion of any Revolving
Credit Borrowing shall not relieve any other Bank of its obligation
hereunder to make its Loan on the date of such Revolving Credit
Borrowing. No Bank shall be responsible for the failure of any
other Bank to make the Loan to be made by such other Bank on the
date of any Revolving Credit Borrowing.
(h) Rate Conversion and Rate Continuation of Revolving Credit
Loans. The Borrower shall have the right, upon request delivered
by the Borrower to the Agent (i) not later than 12:00 noon
(Cleveland time) on the Business Day that Borrower desires to
convert any LIBOR Rate Loans comprising a Revolving Credit
Borrowing into Prime Rate Loans so as to comprise a Revolving
Credit Borrowing, (ii) not later than 12:00 noon (Cleveland time)
four (4) Business Days prior to a Rate Conversion, to convert any
Prime Rate Loans comprising a Revolving Credit Borrowing into LIBOR
Rate Loans for a given Interest Period so as to comprise a
Revolving Credit Borrowing, (iii) not later than 12:00 noon
(Cleveland time) four (4) Business Days prior to a Rate
Continuation, to continue any LIBOR Rate Loans comprising a given
Revolving Credit Borrowing as LIBOR Rate Loans for an additional
Interest Period of the same duration so as to comprise a Revolving
Credit Borrowing and (iv) not later than 12:00 noon (Cleveland
time) four (4) Business Days prior to a Rate Conversion, to convert
any LIBOR Rate Loans having a particular Interest Period comprising
a Revolving Credit Borrowing into LIBOR Rate Loans having a
different permissible Interest Period so as to comprise a Revolving
Credit Borrowing; provided, however, that each such Rate Conversion
or Rate Continuation shall be subject to the following:
(A) each Rate Conversion or Rate Continuation shall be made
among the Banks based upon each Bank's Ratable Portion of such
converted or continued Revolving Credit Loans comprising a
Revolving Credit Borrowing,
(B) if less than all the outstanding principal amount of the
Revolving Credit Loans comprising a Revolving Credit Borrowing is
converted or continued, the aggregate principal amount of such
Revolving Credit Loans converted or continued shall be, (i) in the
case of LIBOR Rate Loans, not less than Three Million Dollars
($3,000,000), or a multiple of One Million Dollars ($1,000,000) in
excess thereof and (ii) in the case of Prime Rate Loans, not less
than One Million Dollars ($1,000,000) or a multiple thereof,
(C) each Rate Conversion or Rate Continuation shall be
effected by each Bank by applying the proceeds of the Revolving
Credit Loan resulting from such Rate Conversion or Rate
Continuation to the Revolving Credit Loan of such Bank being
converted or continued, as the case may be, and the accrued
interest on any such Revolving Credit Loan (or portion thereof)
being converted or continued shall be paid to the Agent on behalf
of each Bank by the Borrower at the time of such Rate Conversion or
Rate Continuation,
(D) LIBOR Rate Loans shall not be converted or continued at a
time other than the end of an Interest Period applicable thereto
unless the Borrower shall pay, upon demand, any amounts due to the
Banks pursuant to Section 9.05,
(E) Revolving Credit Loans comprising a Revolving Credit
Borrowing may not be converted into or continued as LIBOR Rate
Loans less than one month prior to the Revolving Credit Termination
Date,
(F) Revolving Credit Loans comprising a Revolving Credit
Borrowing that cannot be converted into or continued as LIBOR Rate
Loans by reason of clause (E) shall be automatically converted at
the end of the Interest Period in effect for such LIBOR Rate Loans
into Prime Rate Loans comprising a Revolving Credit Borrowing,
(G) no Interest Period can be selected in connection with any
Rate Conversion or Rate Continuation ending after the date of any
mandatory reduction specified in Section 2.04(c)(iii) unless, after
giving effect to such selection, the aggregate unpaid principal
amount of any then outstanding Prime Rate Loans taken together with
the principal amount of any then outstanding LIBOR Rate Loans
having Interest Periods ending on or prior to the date of such
mandatory reduction shall be at least equal to the principal amount
of the Revolving Credit Loans due and payable on or prior to such
date.
Each such request for a conversion or continuation (a "Rate
Conversion/Continuation Request") in respect of Revolving Credit
Loans comprising a Revolving Credit Borrowing shall be transmitted
by the Borrower to the Agent, by telecopier, telex or cable (in the
case of telex or cable, confirmed in writing prior to the effective
date of the Rate Conversion or Rate Continuation requested), in
substantially the form of Exhibit C hereto, specifying (A) the
identity and amount of the Revolving Credit Loans comprising a
Revolving Credit Borrowing that the Borrower requests be converted
or continued, (B) the Type of Revolving Credit Loans into which
such Revolving Credit Loans are to be converted or continued, (C)
if such notice requests a Rate Conversion, the date of the Rate
Conversion (which shall be a Business Day) and (D) in the case of
Revolving Credit Loans comprising a Revolving Credit Borrowing
being converted into or continued as LIBOR Rate Loans, the Interest
Period for such LIBOR Rate Loans. The Agent shall promptly deliver
on the day received a copy of each such Conversion/Continuation
Request to the Banks.
SECTION 2.03 Reduction of Revolving Credit Commitments.
The Borrower may, at any time and without the payment of a premium,
in whole permanently terminate, or from time to time in part
permanently reduce, the aggregate Revolving Credit Commitments by
delivering to the Agent, not later than 12:00 noon (Cleveland time)
ten (10) Business Days immediately preceding the effective date of
the reduction, a notice of such reduction (a "Reduction Notice"),
in the form of Exhibit D hereto, stating the aggregate amount by
which the Revolving Credit Commitments are to be reduced and the
effective date of such reduction. Each reduction shall be subject
to the following:
(i) Each such reduction shall be in an aggregate principal
amount of not less than Five Million Dollars ($5,000,000) or a
multiple of One Million Dollars ($1,000,000) in excess thereof.
(ii) The Borrower shall not be permitted to reduce the
aggregate Revolving Credit Commitments unless, concurrently with
any reduction, the Borrower shall make a principal payment on each
Bank's then outstanding Revolving Credit Loans in an amount equal
to the excess, if any, of such Revolving Credit Loans over the
Revolving Credit Commitment of such Bank as so reduced.
Each reduction in the aggregate Revolving Credit Commitments
hereunder shall be made among the Banks ratably in accordance with
their Revolving Credit Commitments. On the date of each reduction,
the Borrower shall pay to the Agent for the account of the Banks
(i) the commitment fees and interest accrued through the date of
such reduction in respect of the aggregate Revolving Credit
Commitments and (ii) any amounts required pursuant to the
provisions of Article IX.
SECTION 2.04 Repayments and Prepayments.
(a) Repayment. The Borrower shall repay to the Agent for
account of the Banks the outstanding principal amount of the Loans,
together with all accrued interest and fees with respect thereto
and any other Obligations of the Borrower, on the Revolving Credit
Termination Date.
(b) Permitted Prepayments. The Borrower may, upon at least
three (3) Business Days' notice to the Agent stating the proposed
date and aggregate principal amount of the prepayment, and, upon
such notice, shall prepay the outstanding aggregate principal
amount of the Revolving Credit Loans comprising part of the same
Revolving Credit Borrowing in whole or ratably in part, together
with accrued interest to the date of such prepayment on the
principal amount prepaid; provided, however, that (x) each partial
prepayment of Prime Rate Loans shall be in an aggregate principal
amount of One Million Dollars ($1,000,000) or any multiple thereof,
(y) each partial prepayment of LIBOR Rate Loans shall be in an
aggregate principal amount not less than Three Million Dollars
($3,000,000) or any multiple of One Million Dollars ($1,000,000) in
excess thereof and (z) any prepayment of any LIBOR Rate Loans made
on other than the last day of an Interest Period shall obligate the
Borrower to reimburse the Banks in respect thereof pursuant to
Section 9.05.
(c) Mandatory Prepayments.
(i) Revolving Credit Loans in Excess of Revolving Credit
Commitments. If, at any time, the aggregate outstanding amount of
the Revolving Credit Loans exceeds the total dollar amount of the
aggregate Revolving Credit Commitments contrary to the terms of
Section 2.02(a) (and as the same may be reduced from time to time
pursuant to Section 2.03 or amended with the consent of each of the
Banks), the Borrower shall on such day prepay an aggregate
principal amount of such Loans in an amount at least equal to such
excess, together with accrued interest to the date of such
prepayment on the principal amount prepaid to the Banks, together
with any compensation payable pursuant to Section 9.05.
(ii) Excess of Revolving Credit Loans over Borrowing Base.
Within five (5) Business Days following the delivery of a Borrowing
Base Report pursuant to Section 5.01(d), the Borrower shall prepay
the Revolving Credit Loans in the amount, if any, by which the
outstanding principal amount of the aggregate Revolving Credit
Loans exceeds the amount of the Borrowing Base set forth in such
Borrowing Base Report, together with accrued interest to the day of
such prepayment on the amount prepaid to the Banks, together with
any compensation payable pursuant to Section 9.05.
(iii) Temporary Reduction. During each of the fifteen (15)
calendar month periods commencing with the fifteen month period
commencing on the Closing Date and ending October 31, 1995, the
Borrower shall reduce the aggregate outstanding amount of the
Revolving Credit Loans to an amount less than or equal to Fifty
Million Dollars ($50,000,000) and, upon any such reduction, the
Borrower shall not permit such reduced principal amount to exceed
Fifty Million Dollars ($50,000,000) such amount for a period of
thirty (30) consecutive calendar days commencing on the first day
that the aggregate outstanding Revolving Credit Loans are so
reduced, together with any compensation payable pursuant to Section
9.05.
(iv) Prepayment from Proceeds of Equity or Debt Issuance. In
the event that the Borrower shall at any time issue any public or
private offering of debt or equity, the Borrower shall prepay the
aggregate Revolving Credit Loans outstanding on the closing date of
such issues in an amount equal to the lesser of (x) one hundred
percent (100%) of the net cash proceeds from such debt or equity
issuance or (y) the aggregate amount of all Revolving Credit Loans
outstanding on the closing date of such issuance; provided, however
that, in the event that any portion of prepayment required under
this Section 2.04(c)(iv) would cause the Borrower to incur a
compensation obligation to any Bank by reason of the prepayment of
LIBOR Rate Loans on other than the last day of an Interest Period,
so long as no Event of Default has occurred and is continuing, the
Borrower may deposit such amount with the Agent and direct the
Agent to invest such amounts in Acceptable Marketable Securities of
the Agent for such period as is necessary to avoid such obligation
but in no case maturing past the last day of the Interest Period in
question. The Agent shall apply the proceeds of any such
Acceptable Marketable Securities to the repayment of the Revolving
Credit Loans on the last day of such Interest Period. Upon the
occurrence and continuation of an Event of Default, the Agent may,
upon the request of the Majority Banks, cause any amount so
invested to be applied to the Obligations notwithstanding any
penalty arising under this Agreement or by reason of the
liquidation of such Acceptable Marketable Securities.
(v) Prepayment from Proceeds of Released Collateral. In the
event that the Borrower requests the Agent to release Collateral
pursuant to Section 2.08(b) and the aggregate Asset Value of all
Borrowing Base Assets on the Borrowing Base Report delivered
pursuant to Section 2.08(b)(iv) in connection with such release is,
less than one hundred fifty percent (150%) of the aggregate
Revolving Credit Loans outstanding on the date of such Borrowing
Base Report, the Borrower shall prepay the aggregate Revolving
Credit Loans outstanding on the date of such release in an amount
equal to the lesser of (i) the cash proceeds of the transaction
giving rise to such release (net of transaction costs) or (ii) the
amount by which the aggregate Asset Value of the Borrowing Base
Assets after such release is less than one hundred fifty percent
(150%) of the aggregate Revolving Credit Loans then outstanding;
provided, however, that this Section 2.04(c)(v) shall in no way
limit the Borrower's obligations to prepay Revolving Credit Loans
as required by Section 2.04(c)(ii); provided, further that, in the
event that any portion of prepayment required under this Section
2.04(c)(v) would cause the Borrower to incur a compensation
obligation to Bank by reason of the prepayment of LIBOR Rate Loans
on other than the last day of an Interest Period, provided no Event
of Default has occurred and is continuing, the Borrower may deposit
such amount with the Agent and direct the Agent to invest such
amount in Acceptable Marketable Securities of the Agent for such
period as is necessary to avoid such obligation but in no case
maturing past the last day of the Interest Period in question. The
Agent shall apply the proceeds of any such Acceptable Marketable
Securities to the repayment of the Revolving Credit Loans on the
last day of such Interest Period. Upon the occurrence and
continuation of an Event of Default, the Agent may, upon the
request of the Majority Banks, cause any amount so invested to be
applied to the Obligations notwithstanding any compensation arising
under this Agreement or by reason of the liquidation of such
Acceptable Marketable Securities.
The provisions of Article IX shall apply to each prepayment set
forth in this Section 2.04. Each prepayment of the aggregate
Revolving Credit Loans outstanding shall be made among the Banks in
accordance with their Ratable Portion. The Borrower shall pay to
the Agent for the account of the Banks, on the date of each
prepayment, the commitment fees and interest accrued through the
date of such prepayment.
SECTION 2.05 Fees.
(a) Revolving Credit Commitment Fee. The Borrower agrees to
pay to the Agent for the account of each Bank a commitment fee on
the average daily unused portion of such Bank's Revolving Credit
Commitment from the date of execution of this Agreement until the
Revolving Credit Termination Date at the rate of one half of one
percent (1/2 of 1%) per annum, payable quarterly in arrears on the
first day of each January, April, July and October during the term
of such Bank's Revolving Credit Commitment, commencing October 1,
1994, and on the Revolving Credit Termination Date.
(b) Agent's Fee. The Borrower agrees to pay to the Agent for
the sole account of the Agent a one-time syndication fee and an
annual fee as set forth in the Fee Letter. So long as any Bank
shall have a Revolving Credit Commitment hereunder, or any Note or
Loan shall be outstanding, the nonrefundable, nonproratable annual
fee of the Agent shall be payable, in advance for the forthcoming
year on the date of the execution of this Agreement and on each
Anniversary Date thereafter.
SECTION 2.06 Interest.
(a) Pre-Default Interest. The Borrower shall pay interest on
the unpaid principal amount of each Loan made by each Bank from the
date such Loan is advanced to the Borrower until the principal
amount of such Loan shall be paid in full at the following times
and rates per annum:
(i) Prime Rate Loans. During such periods as such Loan is a
Prime Rate Loan, a rate per annum equal at all times to the Prime
Rate, payable monthly, in arrears, on the first day of each
calendar month during such periods and on the date such Prime Rate
Loan shall be converted or paid in full (whether at maturity, by
reason of acceleration or otherwise).
(ii) LIBOR Rate Loans. During such periods as such Loan is a
LIBOR Rate Loan, a rate per annum equal at all times during each
Interest Period for such Loan to the sum of the LIBOR Rate for such
Interest Period for such Loan plus one and one-half percent (1-
1/2%) at the time of the making of such Loan, or the time of the
conversion or continuation of such Loan, as the case may be, in
accordance with Section 2.02(h), payable: (A) on the last day of
such Interest Period and (B) if such Interest Period has a duration
of more than three months, three months after the first day of such
Interest Period.
(b) Default Interest. Upon and during the continuance of an
Event of Default, the Borrower shall pay interest on the unpaid
principal amount of each Loan and on the unpaid amount of all
interest, fees and other amounts payable hereunder, payable on
demand, at a rate per annum equal at all times to two percent (2%)
above the Prime Rate in effect from time to time. The Borrower
acknowledges that this calculation will result in the accrual of
interest on interest and the Borrower expressly consents and agrees
to this provision.
(c) Additional Interest on LIBOR Rate Loans. To the extent
that any Bank shall be required under regulations of the Board of
Governors of the Federal Reserve System to maintain reserves with
respect to liabilities or assets consisting of or including
Eurocurrency Liabilities, the Borrower shall pay to each such Bank
additional interest on the unpaid principal amount of each Loan of
such Bank during such periods as such Loan is a LIBOR Rate Loan,
from the date such Loan is advanced to the Borrower until the
principal amount of such Loan is paid in full or converted to a
Prime Rate Loan pursuant to Section 2.02(h), at an interest rate
per annum equal at all times to the remainder obtained by
subtracting (i) the LIBOR Rate for such Interest Period for such
LIBOR Rate Loan from (ii) the rate obtained by dividing such LIBOR
Rate by a percentage equal to one hundred percent (100%) minus the
Eurocurrency Reserve Percentage of such Bank for such Interest
Period, payable on each date on which interest is payable on such
LIBOR Rate Loan. A certificate as to the amount of such additional
interest shall be submitted to the Borrower and the Agent by such
Bank, and shall be conclusive and binding for all purposes, absent
manifest error.
(d) Interest Rate Determination.
(i) Agent Determination; Notice. The Agent shall determine
the LIBOR Rate in accordance with the definition of LIBOR Rate set
forth in Section 1.01. The Agent shall give prompt notice to the
Borrower and the Banks of the applicable interest rate determined
by the Agent for purposes of Section 2.06(a)(i) or (ii).
(ii) Failure of Borrower to Elect. If no Interest Period is
specified in any Credit Request or any Rate Conversion/Continuation
Request for any LIBOR Rate Loans comprising a Revolving Credit
Borrowing, the Borrower shall be deemed to have selected an
Interest Period with a duration of one month. If the Borrower
shall not have given notice in accordance with Section 2.02(h) to
continue any LIBOR Rate Loans comprising a Revolving Credit
Borrowing into a subsequent Interest Period (and shall not have
otherwise delivered a Rate Conversion/Continuation Request in
accordance with this Section 2.02(h) to convert such Loans), such
LIBOR Rate Loans shall, at the end of the Interest Period
applicable thereto (unless repaid pursuant to the terms hereof),
automatically convert into Prime Rate Loans.
SECTION 2.07 Payments and Computations.
(a) Payments. The Borrower shall make each payment hereunder
and under the Notes with respect to principal of, interest on, and
other amounts relating to Loans, not later than 12:00 noon
(Cleveland time) on the day when due in Dollars to the Agent in
immediately available funds by deposit of such funds to the Agent's
account maintained at the Payment Office. Payments received after
12:00 noon (Cleveland time) shall be deemed to have been received
on the next succeeding Business Day. The Agent will promptly
thereafter cause to be distributed like funds relating to the
payment of principal or interest or commitment fees ratably (other
than amounts payable pursuant to Section 2.05(b) solely to the
Agent) to each of the Banks for the account of its respective
Lending Office, and like funds relating to the payment of any other
amount payable to any Bank to such Bank for the account of its
Lending Office. The funds so distributed to each Bank shall in
each case be applied by such Bank in accordance with the terms of
this Agreement.
(b) Authorization to Charge Account. If and to the extent
payment owed to such Bank is not made when due hereunder or under
the Note held by such Bank, the Borrower hereby authorizes each
Bank to charge from time to time against any or all of the
Borrower's accounts with such Bank any amount so due.
(c) Computations of Interest and Fees. All computations of
interest, commitment fees and all other fees shall be made by the
Agent on the basis of a year of 360 days in each case for the
actual number of days (including the first day but excluding the
last day) occurring in the period for which such interest or fees
are payable. Upon the request of any Bank, the Agent shall deliver
to such Bank the Agent's computation with respect to interest,
commitment fees or other fees payable hereunder. Each
determination by the Agent (or, in the case of Section 2.06(c), by
a Bank) of an interest rate hereunder shall be conclusive and
binding for all purposes, absent manifest error.
(d) Payment not on Business Day. Whenever any payment
hereunder or under the Notes shall be stated to be due on a day
other than a Business Day, such payment shall be made on the next
succeeding Business Day, except, that, if such extension would
cause payment of interest on or principal of LIBOR Rate Loans to be
made in the next following calendar month, such payment shall be
made on the immediately preceding Business Day. Any such extension
or reduction of time shall in such case be included in the
computation of payment of interest or commitment fee, as the case
may be.
(e) Presumption of Payment in Full by Borrower. Unless the
Agent shall have received notice from the Borrower prior to the
date on which any payment is due to the Banks hereunder that the
Borrower will not make such payment in full, the Agent may assume
that the Borrower has made such payment in full to the Agent on
such date. In reliance upon such assumption, the Agent may, but
shall not be obligated to, distribute to each Bank on such due date
the amount then due such Bank. If and to the extent the Borrower
shall not have made such payment in full to the Agent, each Bank
shall repay to the Agent promptly upon demand the amount
distributed to such Bank together with interest thereon, for each
day from the date such amount is distributed to such Bank until the
date such Bank repays such amount to the Agent, at the Federal
Funds Rate plus the amount of any costs, expenses, liabilities or
losses incurred by the Agent in connection with its distribution of
such funds.
SECTION 2.08 Addition and Release of Collateral.
Collateral shall be released upon payment in full of the
Obligations and shall also be released as hereinafter set forth:
(a) Addition of Specific Collateral. The Borrower may, from
time to time, add Operator Leases and Operator Loans to the
Borrowing Base Assets which shall be Collateral securing the Loans.
In the event that the Borrower desires to add any Operator Lease or
Operator Loan to the Borrowing Base, as Collateral, the Borrower
shall deliver a Notice of Borrowing Base Addition/Removal pursuant
to Section 3.03(a) or 3.03(b), as the case may be, together with
all documents, certificates and other deliveries required by
Section 3.03(a), 3.03(b) or 3.03(c), not less than fifteen (15)
Business Days prior to the date upon which the Borrower desires
such Operator Lease or Operator Loan to become a Borrowing Base
Asset.
(b) Release of Specific Collateral; Ordinary Course. Upon the
request of the Borrower, the Agent shall release the Collateral in
respect of any Eligible Operator Lease or Eligible Operator Loan;
provided, however, that, prior to the release of such Collateral,
the Borrower shall have:
(i) delivered to the Agent a Notice of Borrowing Base
Addition/Removal (a copy of which the Agent shall forward to the
Banks) with respect to the release of such Eligible Operator Lease
or Eligible Operator Loan,
(ii) certified to the Agent in writing (A) that such release
is either (I) required in connection with the sale of a Borrower
Fee Property in respect of such Eligible Operator Lease by the
Borrower in the ordinary course of the Borrower's business, (II)
required pursuant to the exercise by an Operator of an option to
purchase a Borrower Fee Property in respect of such Eligible
Operator Lease in accordance with the applicable Operator Lease
Documents or (III) required in connection with an Operator's
payment in full to the Borrower (whether by prepayment or
otherwise) of an Eligible Operator Loan in accordance with the
applicable Operator Loan Documents, (B) the amount of cash proceeds
(net of transaction costs) to be realized from such sale or the
exercise of such option or, in the case of the repayment or
prepayment by an Operator of an Operator Loan, the amount of such
repayment or prepayment, (C) that either (I) such amount or a
portion of such amount will be delivered to the Agent for
application to the then outstanding Revolving Credit Loans pursuant
to Section 2.04(c)(v) or (II) such amount is not required to be
delivered to the Agent pursuant to 2.04(c)(v) and (D) that no
Default then exists or would exist upon the release of such
Collateral,
(iii) delivered to the Agent such documents as are required
for the release of the Collateral Documents with respect to such
Operator Lease and the related Borrower Fee Property or such
Operator Loan and Operator Loan Documents, as the case may be, and
(iv) delivered a Borrowing Base Report reflecting the amount
of the Borrowing Base after the release of such Operator Lease or
Operator Loan.
In the event that the Borrower shall be required to deliver the
proceeds or any portion of the proceeds from the disposition of any
Borrower Fee Property or the repayment of an Operator Loan to the
Agent pursuant to Section 2.04(c)(v), (x) upon satisfaction of the
conditions set forth in this Section 2.08(b), the Agent shall
deliver executed release documents to the Title Company to be held
in escrow until the Title Company shall have received the proceeds
from the disposition of the Borrower Fee Property or the repayment
of an Operator Loan and the proceeds shall have been received by
the Agent from the Title Company for the account of the Borrower
and (y) the Agent shall apply such amounts as required by Section
2.04. In the event that the Borrower shall not be required to
deliver the proceeds from the disposition of any Borrower Fee
Property or the repayment of any Operator Loan, upon satisfaction
of the conditions set forth in this Section 2.08(b), the Agent
shall deliver executed release documents to the Borrower.
(c) Release of Collateral; Environmental Harm. In the event
that the Asset Value of any Borrowing Base Asset shall be Zero
Dollars ($0) by reason of a noncompliance with any Environmental
Law (including noncompliance with or failure to obtain any
Environmental Permit) or an Environmental Claim or other
environmental condition which noncompliance, failure or condition,
when taken singly or in the aggregate) has resulted or would, more
likely than not, result in a Material Impairment of such Borrowing
Base Asset, the Agent, with the consent of the Majority Banks, may
release any and all Liens of the Agent for the benefit of the Banks
in respect of such asset and neither the Agent nor any Bank shall
have any obligation to the Borrower by reason of such release.
(d) Release of All Collateral; BBB+ Rating Event. In the event
that D&P shall rate the unsubordinated, senior, unsecured
Indebtedness of the Borrower with a rating of "BBB+" or better (or
any other Rating Agency shall rate such Indebtedness with the
equivalent rating) for a period of at least six (6) consecutive
calendar months (or such shorter period as the holders of the
Senior Notes and the holders of any Additional Indebtedness shall
otherwise agree in writing in respect of the release of the
collateral securing the Senior Notes and such Additional
Indebtedness), the Agent shall release any and all Liens with
respect to the Collateral; provided, however, that no Collateral
shall be released pursuant to this Section 2.08(d) unless:
(i) the amount of the aggregate Indebtedness of the Borrower
secured by Liens on the Borrower's Balance Sheet Assets (other than
the Indebtedness to and Liens in favor of the Banks and the holders
of the Senior Notes) shall not exceed an amount equal to twenty
percent (20%) of the Consolidated Net Worth of the Borrower as of
the last day of the Fiscal Quarter immediately preceding the Fiscal
Quarter during which the Collateral is to be released pursuant to
this Section 2.08(d),
(ii) the Borrower shall deliver to the Agent any and all
documents required for the release of such Collateral, and
(iii) the Title Company shall notify the Agent (which the
Agent shall forward to the Banks) that the documents necessary to
release all collateral securing the Senior Notes and all collateral
securing any Additional Indebtedness have been deposited with the
Title Company and that the Title Company is under irrevocable
instruction to file such releases simultaneously with the filing of
the releases of Liens in favor of the Agent for the benefit of the
Banks.
Upon satisfaction of such conditions, the Agent shall deliver
executed release documents to the Title Company to be filed in
accordance with such notification and under escrow instructions
from the Agent that the releases of the Agents Liens are to be
released only upon the simultaneous filing of the releases of the
Liens in favor of the Senior Notes and any Additional Indebtedness.
(e) Release of Collateral; BBB Rating Event. In the event
that each holder of the Senior Notes and any Additional
Indebtedness agree in writing to release all Liens in favor of the
Senior Notes and Additional Indebtedness simultaneously with the
Release of Liens in favor of the Agent, the Agent shall release any
and all Liens with respect to the Collateral; provided, however,
that, no Collateral shall be released pursuant to this Section
2.08(e) unless:
(i) such release occurs at least one hundred eighty (180)
calendar days since the Closing Date,
(ii) the amount of the aggregate Indebtedness of the Borrower
secured by Liens on the Borrower's Balance Sheet Assets (other than
the Indebtedness to and Liens in favor of the Banks and the holders
of the Senior Notes) shall not exceed an amount equal to twenty
percent (20%) of the Consolidated Net Worth of the Borrower as of
the last day of the Fiscal Quarter immediately preceding the Fiscal
Quarter during which the Collateral is to be released pursuant to
this Section 2.08(e),
(iii) D&P shall rate the unsubordinated, senior, unsecured
Indebtedness of the Borrower with a rating of "BBB" or better (or
any other Rating Agency shall rate such Indebtedness with the
equivalent rating) and, immediately prior to the release of
Collateral pursuant to this Section 2.08(e) such Rating Agency
shall reconfirm the "BBB" rating in writing,
(iv) the Borrower shall deliver to the Agent any and all
documents required for the release of such Collateral, and
(v) the Title Company shall notify the Agent (which the Agent
shall forward to the Banks) that the documents required to release
the collateral securing the Senior Notes and all collateral
securing any Additional Indebtedness have been deposited with such
Title Company and that the Title Company is under irrevocable
instructions to file such releases simultaneously with filing of
the releases of the Liens of the Agent for the benefit of the
Banks.
Upon satisfaction of such conditions, the Agent shall deliver
executed release documents to the Title Company to be filed in
accordance with such notification and under escrow instructions
from the Agent that the releases of the Agent's Liens are to be
released only upon the simultaneous filing of the releases of the
Liens in favor of the Senior Notes and any Additional Indebtedness.
(f) Subsequent Collateralization. In the event that, after the
conditions of Section 2.08(d) or 2.08(e), as the case may be, have
been met and the Collateral has been released, D&P or any other
Rating Agency or Rating Agencies which rated the Borrower BBB+ or
BBB (or the equivalent rating of the Rating Agency or Rating
Agencies in question) and which were relied upon by the Borrower
for the purposes of Section 2.08(d) or 2.08(e) above, shall, at any
time, lower the rating of the Borrower's debt issuances to "BBB-"
or lower (or the equivalent rating of the Rating Agency in
question), the Borrower shall, within thirty (30) Business Days,
take all actions necessary to provide Liens on sufficient
Borrower's Balance Sheet Assets which qualify as Borrowing Base
Assets such that the aggregate outstanding Revolving Credit Loans
shall not exceed seventy-five percent (75%) of the aggregate Asset
Value of such Borrowing Base Assets.
(g) Release Agreements and Covenants. Upon the release of the
Collateral pursuant to Section 2.08(d) or 2.08(e), and until and
unless the Obligations are subsequently secured pursuant to Section
2.08(f):
(i) Section 5.04(e)(G) shall be ineffective and the Borrower
shall not be permitted to suffer any Liens upon its assets other
than as otherwise permitted by Section 5.04(e), except that, the
Borrower may suffer to exist Liens securing Indebtedness (other
than the Indebtedness to the Bank and the holders of the Senior
Notes and the holders of any Additional Indebtedness) so long as
the amount of such Indebtedness (including principal, accrued
interest and fees) does not at any time exceed an amount equal to
twenty percent (20%) of the Consolidated Net Worth of the Borrower,
(ii) The Borrower shall not be required to deliver a Borrowing
Base Report as required by any provision of this Agreement,
(iii) The Borrower shall not be required to comply with
Sections 2.04(c)(ii), 2.04(c)(v), 2.08(a), 2.08(b), 2.09(a),
5.03(m), 5.03(n), 5.04(n) and 5.05(e) and the Borrower shall not be
deemed to have made any representation or warranty in Article IV
relating to "Collateral", "Eligible Operator Loans", "Eligible
Operator Loan Documents", "Eligible Operator Leases" or "Eligible
Operator Lease Documents",
(iv) Upon release of the Liens in favor of the Agent pursuant
to Section 2.08(d), the Borrower shall not at any time permit or
suffer the aggregate Indebtedness of the Borrower to exceed: (A)
sixty-five percent (65%) of the aggregate Asset Value of all
unencumbered Borrower's Balance Sheet Assets or (B) in the event
D&P or any other Rating Agency shall, at any time, lower the rating
of the Borrower's debt issuances to "BBB" (or the equivalent rating
of the Rating Agency in question), sixty-percent (60%) of such
aggregate Asset Value,
(v) Upon release of the Liens in favor of the Agent pursuant
to this Section 2.08(e), the Borrower shall not at any time permit
or suffer the aggregate Indebtedness of the Borrower to exceed
sixty percent (60%) of the aggregate Asset Value of all
unencumbered Borrower's Balance Sheet Assets.
In the event that the Obligations are subsequently secured pursuant
to Section 2.08(f), this clause (g) shall cease to be effective and
the Borrower shall be required to comply with each of the
provisions of this Agreement as if the Liens on the Collateral had
not been released.
SECTION 2.09 Addition of Other Assets to Borrowing Base;
Alternative Investment Structure.
(a) Addition of Other Assets to Borrowing Base. In the event
that the Borrower is unable to add an Operator Loan or Operator
Lease to the Collateral because such Operator Loan or Operator
Lease does not meet the requirements of an Eligible Operator Loan
or an Eligible Operator Lease, the Borrower may request that the
Banks consider such Operator Loan or Operator Lease for addition to
the Collateral; provided, however, that, prior to the Banks'
consideration of such lease or loan, the Borrower shall have:
(i) delivered to each of the Banks a Notice of Borrowing Base
Addition/Removal together with each of the documents required by
Section 3.03(a) or 3.03(b) as the case may be, to the extent
applicable,
(ii) certified to the Agent and each of the Banks (A) the
eligibility, Qualified Investment or the documentation requirements
of 3.03(a) or 3.03(b), as the case may be, which such Operator
Lease or Operator Loan does not satisfy and (B) a statement
describing the Borrower's business reasons for requesting the
Banks' to consider such asset and setting forth the basis for the
Borrower's determination that the Operator Lease's or Operator
Loan's failing to satisfy the criteria set forth in clause (A)
above would not result in a Material Impairment of such Operator
Lease or Operator Loan,
(iii) delivering to each Bank a Borrowing Base Report
reflecting the effect of the addition of such Operator Loan or
Operator Lease, and
(iv) delivering to each Bank a fee in the amount of Two
Thousand Five Hundred Dollars ($2,500) in consideration of such
Bank's considering and analyzing whether to waive the noncompliance
of the Operator Loan or Operator Lease with the Qualified
Investment, eligibility or documentation requirements of this
Agreement; provided, however, that, with respect to the three (3)
Operator Leases and Operator Loans set forth on the Schedule
2.09(a), the Banks shall not require the fee set forth in this
clause (iv) (or any other fee) for the review of such Operator
Leases or Operator Loans subject to the following conditions: on or
before seven (7) Business Days after the Closing Date, the Borrower
shall have delivered to each of the Banks (A) the notice provided
by clause (i) hereof, (B) the certificate required by clause (ii)
hereof, (C) the Borrowing Base Report required by clause (iii)
hereof and (D) the documents required to be delivered pursuant to
Section 3.03(a) or 3.03(b) (except as identified in the certificate
required by clause (iii) above).
Within forty-five (45) days of the receipt by each of the Banks of
each of the above referenced items, each of the Banks agrees to
consider whether such Bank will approve the addition of such
Operator Lease or Operator Loan to the Borrowing Base Assets. Any
Bank not notifying the Borrower and the Agent of its decision
within such forty-five (45) day period shall be deemed to have
denied the Borrower's request to add such Operator Loan or Operator
Lease as a Borrowing Base Asset. Upon the consent of the Majority
Banks, such Operator Loan or Operator Lease shall become an
Eligible Operator Loan or an Eligible Operator Lease, as the case
may be. Each Operator Loan and each Operator Lease which is
permitted by the Majority Banks pursuant to this Section 2.09(a)
shall not be, at any time, determined not to be an Eligible
Operator Loan or Eligible Operator Lease by reason of the items
listed as required by clause (A) of the certificate of the Borrower
delivered pursuant to Section 2.09(a)(ii) above and each
representation and warranty with respect to Borrowing Base Assets
made by the Borrower shall not be a representation or warranty
solely as to the items specified in such certificate.
(b) Alternative Investment Structures. In the event that the
Borrower desires to finance Health Care Facilities using a
financing structure which is substantially different from the
Operator Loan and Operator Lease structures used by the Borrower on
the Closing Date, the Borrower may request that such financing
structure be approved by the Banks upon delivery to each of the
Banks of (a) a description of the proposed structure, (b) drafts of
the proposed documentation to be entered into between the Borrower
and its Operators, (c) a description of the provisions of this
Agreement which would be breached by the Borrower's entering into
such financing transactions and (d) a certification that, in the
Borrower's prudent business judgment, such structure does not
materially change the credit risk of the Borrower or the Banks.
Upon the written consent of each of the Banks, the Agent, the Banks
and the Borrower shall amend this Agreement: (x) to establish
eligibility criteria in order that transactions with such
structures may become Borrowing Base Assets and (y) to document the
investment and documentation standards for such transaction, which
standards must be acceptable to each of the Banks, in its
reasonable discretion.
SECTION 2.10 Illegality. Notwithstanding any other
provision of this Agreement, if any Bank determines that any
applicable Law, or any change therein, or any change in the
interpretation or administration of any Law by any governmental
authority, central bank or comparable agency charged with the
interpretation or administration thereof, or compliance by such
Bank (or its Lending Office) with any request or directive (whether
or not having the force of law) of any such authority, central bank
or comparable agency, shall make it unlawful or impossible, or any
such governmental authority, central bank or agency asserts that it
is unlawful, for any Bank or its Lending Office to perform its
obligations hereunder to make LIBOR Rate Loans or to fund or
maintain LIBOR Rate Loans hereunder, then, upon notice to the Agent
and the Borrower by such Bank: (i) the obligation of the Banks to
make, or to convert Loans into, LIBOR Rate Loans shall be suspended
until the Agent shall notify the Borrower and the Banks that the
circumstances causing such suspension no longer exist and (ii) the
Borrower shall immediately, or at such later date, if any, as may
thereafter be permitted by relevant Law, prepay in full the then
outstanding principal amount of all LIBOR Rate Loans of all Banks,
together with interest accrued thereon and any other amounts
payable to the Banks hereunder unless the Borrower, within five
Business Days of notice from the Agent, converts all LIBOR Rate
Loans of all Banks then outstanding into Loans of another Type in
accordance with Section 2.02(h) as to which such circumstances do
not exist. Any such payment or Rate Conversion shall be subject to
the provisions of Article IX.
SECTION 2.11 Unavailability. Notwithstanding any other
provision in this Agreement, if at any time with respect to any
LIBOR Rate Loans:
(a) Inadequate Rate. Any Bank notifies the Agent that the
LIBOR Rate for any Interest Period for such LIBOR Rate Loans will
not adequately reflect the cost to such Bank of making, funding or
maintaining its LIBOR Rate Loans for such Interest Period, the
Agent shall promptly notify the Borrower and the Banks, or
(b) Unavailable Quotations. The Agent determines (which
determination shall be conclusive) that quotations of interest
rates for Dollar deposits are not being provided in the relevant
amounts or for the relevant maturities to, or the circumstances
affecting the London interbank market of deposits in Dollars make
it impracticable to, determine the LIBOR Rate, or
(c) Unavailable Deposits. Any Bank determines that Dollar
deposits of the relevant amount for the relevant Interest Period
are not available in the London interbank market of deposits of
Dollars for the purpose of funding the LIBOR Rate Loans,
then (i) each LIBOR Rate Loan will automatically, on the last day
of the then existing Interest Period therefor, convert into a Prime
Rate Loan and (ii) the obligation of the Banks to make or to
convert Loans into LIBOR Rate Loans shall be suspended until the
Agent shall notify the Borrower and the Banks that the
circumstances causing such suspension no longer exist.
ARTICLE III
CONDITIONS OF LENDING
SECTION 3.01 Conditions Precedent to Initial Revolving
Credit Borrowing. The effectiveness of this Agreement and the
obligation of each Bank to make the Loans comprising the initial
Revolving Credit Borrowing is subject to the condition precedent
that the Agent shall have received the following on or before the
Closing Date, each of which shall be in form and substance
satisfactory to the Agent and, at the Agent's request, the Banks:
(a) Revolving Credit Notes. Revolving Credit Notes, in favor
of each of the Banks, in the principal amount of such Bank's
Revolving Credit Commitment, each duly executed by the Borrower.
(b) Security Agreement. A Security Agreement executed by the
Borrower as to Eligible Operator Loan Documents, Eligible Operator
Lease Documents and Cross-Collateralized Loans listed on the
Initial Borrowing Base Certificates together with UCC-1 Financing
Statements with respect thereto.
(c) Guaranty Agreement. A Guaranty Agreement executed by HCRI
Pennsylvania Properties, Inc., a Pennsylvania corporation, and a
Wholly-Owned Subsidiary of the Borrower.
(d) Borrowing Base Asset Documents. The conditions set forth
in Section 3.02(a) and 3.02(b) shall have been satisfied.
(e) Good Standing and Foreign Qualification Certificates. A
certificate of good standing from the Secretary of State or other
appropriate official of each state in which qualification is
necessary for the maintenance of good title or the enforcement of
the Borrower Mortgages in favor of the Agent and the enforcement of
the mortgages in favor of the Borrower with respect to the Eligible
Operator Loans set forth on Schedule II.
(f) Certificate of Incorporation and Good Standing. As to the
Borrower, (i) a copy of the Certificate of Incorporation of the
Borrower certified by the Secretary of State of Delaware and dated
not more than ten (10) days prior to the Closing Date and (ii) a
long form certificate of good standing certified by the Secretary
of State of Delaware and dated not more than ten (10) days prior to
the Closing Date. As to HCRI Pennsylvania Properties, Inc., (i)
copy of the Certificate of Incorporation of HCRI Pennsylvania
Properties, Inc. certified by the Secretary of the Commonwealth of
Pennsylvania and dated not more than ten (10) days prior to the
Closing Date and (ii) a long form certificate of good standing
certified by the Secretary of the Commonwealth of Pennsylvania and
dated not more than ten (10) days prior to the Closing Date.
(g) Borrower's Legal Opinion. A favorable opinion of
Shumaker, Loop & Kendrick (i) as counsel to the Borrower,
substantially in the form of Exhibits F-1, F-2 and F-3 attached
hereto, and addressing such matters as reasonably requested by the
Agent and the Banks, including without limitation, the due
execution, delivery and enforceability of the Credit Agreement, the
Revolving Credit Notes and the Collateral Documents in accordance
with its terms (as to matters of Ohio law or other applicable law
to the extent comparable to Ohio law in relevant part), subject to
customary qualifications as to bankruptcy, insolvency, equitable
principles and limitations based on commercial reasonableness, good
faith and fair dealing and (ii) as counsel to HCRI Pennsylvania
Properties, Inc. and any other Subsidiaries, as to the due
execution, delivery and enforceability of the Guaranty Agreement of
such Subsidiary against such Subsidiary in accordance with its
terms, subject to customary qualifications as to bankruptcy,
insolvency, equitable principles and limitations based on
commercial reasonableness, good faith and fair dealing.
(h) Termination Statements. A copy of all documents executed
by any lender, manufacturer, vendor and/or lender effecting a
termination of any financing statement or other document used to
perfect a security interest in any part of the Collateral in proper
form for filing in each jurisdiction wherein such financing
statements or other document shall have been filed.
(i) Lien Searches. Results of searches, in form and scope and
as of such dates as are satisfactory to the Agent, of UCC, tax,
judgment and all other liens which may have been filed against
Borrower or any Subsidiary, with respect to any of the Collateral.
(j) Consents. Evidence satisfactory to the Agent that the
Borrower has obtained, as certified by an officer of Borrower, all
documents and instruments, including all consents, authorizations,
novations and filings required under law or under any material
contractual obligations of Borrower as may be necessary for
consummation of the transactions contemplated by this Agreement and
the Related Writings.
(k) Certificate of the Borrower. A certificate executed by an
authorized officer of the Borrower certifying: (i) the resolutions
of the Board of Directors of the Borrower authorizing the
execution, performance and delivery of (A) this Agreement, (B) the
Revolving Credit Notes, (C) the Collateral Documents to which the
Borrower is a party, (D) all other Related Writings and (E) each
other document executed in connection therewith or in connection
with any of the transactions contemplated herein or therein, (ii)
the names and signatures of the officers of the Borrower executing
or attesting to such documents, (iii) the Certificate of
Incorporation and By-Laws of the Borrower, as true and correct,
(iv) compliance by the Borrower with all representations,
warranties, covenants and conditions under this Agreement and each
of the documents executed in connection herewith, (v) that Bruce G.
Thompson is the Chairman of the Board of Directors and Chief
Executive Officer of the Borrower as of such date, (vi) that
Frederic D. Wolfe is the President of the Borrower as of such date,
(vii) that each Borrower Fee Property which is the subject of a
Borrower Mortgage as of the Closing Date and each Operator Fee
Property which secures an Eligible Loan as of the Closing Date is
undamaged by fire or other casualty and is not subject to any
condemnation proceeding, (viii) the absence of any Default or Event
of Default and (ix) that there is not any material litigation with
respect to this Agreement and the transactions contemplated thereby
and otherwise substantially in the form of Exhibit G-1 attached
hereto.
(l) Certificate of any Subsidiary. A certificate executed by
an authorized officer of each Subsidiary of the Borrower
certifying: (i) the resolutions of the Board of Directors of such
Subsidiary authorizing the execution, performance and delivery of
the Guaranty Agreement to which such Subsidiary is a party and each
other document executed in connection therewith or in connection
with any of the transactions contemplated therein, (ii) the names
and signatures of the officers of the Subsidiary executing or
attesting to such documents, (iii) the Certificate of Incorporation
and By-Laws of the Subsidiary, as true and correct, (iv) compliance
by the Subsidiary with all representations, warranties, covenants
and conditions under this Agreement and each of the documents
executed in connection herewith, (iv) the absence of any Default or
Event of Default in respect of this Agreement or the Guaranty
Agreement executed by such Subsidiary and (v) that there is not any
material litigation with respect to such Guaranty contemplated
thereby and otherwise substantially in the form of Exhibit G-2
attached hereto.
(m) Required Documentation Standard Certificate. A
certificate of the Borrower certifying that, attached to such
certificate are (i) the form documents used by the Borrower and its
counsel in documenting Operator Leases and Operator Loans and (ii)
the general due diligence requirements, title insurance
requirements, insurance requirements, survey requirements and
similar related requirements of the Borrower.
(n) Solvency Certificate. A certificate as to the solvency of
the Borrower in form and substance satisfactory to the Agent and
the Banks executed by the chief financial officer and chief
operating officer of the Borrower.
(o) Borrowing Base Report. A Borrowing Base Report, dated as
of the Closing Date (the "Initial Borrowing Base Report").
(p) Assignment Agreement. The effectiveness of that certain
Assignment and Acceptance Agreement among the Agent, the Banks and
certain other banks and an acknowledgement of such agreement by the
Borrower.
(q) Credit Request and Disbursement Direction Letter. A
Credit Request and a letter from the Borrower directing the Agent
to disburse the proceeds of the initial Revolving Credit Borrowing.
(r) Payment of Syndication and Closing Fee. The Borrower
shall have paid, or directed the Agent to pay to (i) the Agent for
its own account, the syndication fee set forth in the Fee Letter
and (b) each Bank a one-time fee in an amount equal to one-half of
one percent (1/2 of 1%) of such Bank's Revolving Credit Commitment.
(s) Payment of Legal Fees. The Borrower shall pay or shall
direct the Agent to pay to the Agent's legal counsel the legal fees
and expenses of such counsel incurred (and estimated where
necessary) by the Agent through the Closing Date in connection with
the transactions contemplated by this Agreement.
SECTION 3.02 Conditions to Eligibility for Initial
Borrowing Base Assets. With respect to each Operator Lease and
Operator Loan identified on the Initial Borrowing Base Report as
Borrowing Base Assets and each Cross-Collateralized Loan related
thereto, the Agent shall have received on the Closing Date:
(a) Operator Leases. The following documents with respect to
each such Operator Lease:
(i) a copy of each Operator Lease and each Operator Lease
Document related thereto,
(ii) a Collateral Assignment of Operator Lease Documents,
substantially in the form of Exhibit I hereto, executed by the
Borrower in favor of the Agent for the benefit of the Banks which
shall amend, restate and replace any existing collateral assignment
document in respect of such Operator Lease and the related Operator
Lease Document,
(iii) except as set forth in the Supplemental Schedule,
a copy of any lessee's estoppel letter,
(iv) an opinion of Borrower's counsel in favor of the
Agent for the benefit of the Banks (delivered pursuant to Section
3.01(g) above), as to the enforceability of each Borrower Mortgage
and each Collateral Assignment of Operator Lease Documents against
the Borrower and the perfection of the security interest perfected
by the filing of UCC-1 financing statements,
(v) except as set forth in the Supplemental Schedule, a
copy of the opinion of counsel to the Operator, to the extent
received by the Borrower, with respect to each Operator Lease, as
to the enforceability of such Operator Lease against such Operator,
(vi) except as set forth in the Supplemental Schedule, a
copy of any letter of credit, pledge agreement with respect to cash
collateral or Guaranty in favor of the Borrower, in an amount equal
to at least three (3) months lease payment payments or two and one-
half percent (2 -1/2%) of the aggregate lease payments due under
such Operator Lease or such lesser amount as is identified in the
Supplemental Schedule;
(vii) a Borrower Mortgage, substantially in the form of
Exhibit H-1 or H-2 attached hereto, as may be applicable,
(viii) a survey, certified to the Agent (except as set
forth in the Supplemental Schedule), to the Borrower and to the
Title Company, which (A) shall show no easements, encroachments or
other title defects, except those which do not result in a Material
Impairment and in such form as to cause the Title Company to issue
the ALTA title insurance policy required by Section 3.02(a)(ix)
below and to remove the standard survey exception from the title
insurance policy in favor of the Agent, (B) shall be an ALTA survey
(except as set forth in the Supplemental Schedule), and (C) shall
properly certify whether the Borrower Fee Property in respect of
such Operator Lease is located in a "100-year flood plain" as
defined by the Flood Disaster Protection Act of 1973, as amended
from time to time (the "Flood Disaster Act") (except as set forth
in the Supplemental Schedule); provided, however, with respect to
Borrower Fee Properties appearing on the Supplemental Schedule
pursuant to sub-paragraph (C) above, the Borrower shall deliver, on
or before October 10, 1994, evidence satisfactory to each of the
Banks that either (1) each such Borrower Fee Property is not
located in a "100-year flood plain" as defined by the Flood
Disaster Act, or (2) if such Borrower Fee Property is located in a
"100-year flood plain" as defined by the Flood Disaster Act, such
Borrower Fee Property is properly insured with flood insurance made
available under the National Flood Insurance Act of 1968; provided,
further, any non-compliance with the Required Documentation
Standards as to the Borrower Fee Properties appearing on the
Supplemental Schedule pursuant to sub-paragraph (B) or (C) above
shall not cause the Operator Lease in respect of such Borrower Fee
Property to fail to be an Eligible Operator Lease so long as the
other requirements of this clause (viii) have been met,
(ix) an ALTA title insurance policy (or commitment with
the policy to be delivered upon receipt), issued by the Title
Company, in favor of the Agent for the benefit of the Banks,
without the "standard" or presumed exceptions for rights of parties
in possession, mechanic's liens, matters which would be disclosed
by an accurate survey and inspection of the real property in
question, and special taxes and assessments, reflecting no title
defects, survey matters, lack of vehicular access to a dedicated
public street or encumbrances which could result in a Material
Impairment and with the following endorsements: (A) an endorsement
reflecting any assignment of any existing mortgage or Lien
instrument to the Agent for the benefit of the Banks, (B) a
modification endorsement insuring the original mortgage and
reflecting as amended or modified by the Borrower Mortgage in
respect of such Borrower Fee Property as an "insured instrument"
under such policy, (C) a revolving credit endorsement, (D) a "last
dollar endorsement" if required by the Agent to ensure that the
title insurance coverage provided under such policy insures that
the Borrower Mortgage secures the last dollar of the Obligations,
(E) any other affirmative assurances and endorsements contained in
the title insurance policy in favor of the Borrower and (F) in the
event that the survey required pursuant to Section 3.02(a)(viii)
above is not certified to the Agent, an endorsement to the effect
that the Borrower Fee Property subject to the insured mortgage is
the real property shown on such survey,
(x) file-stamped copies of UCC-1 financing statements on
file with respect to such Operator Lease, executed UCC-1 financing
statements or UCC-3 financing statements assigning existing
financing statements, as the case may be, executed by the Borrower
in favor of the Agent for the benefit of the Banks,
(xi) with respect to each Health Care Facility associated
with such Operator Lease, a copy of the most current appraisal
performed by a certified M.A.I. appraiser experienced in appraising
Health Care Facilities certifying the Appraised Value of such
Health Care Facilities and dated no earlier than July 31, 1991 and,
with respect to the Health Care Facilities located at 5026 Faraon
Street, St. Joseph, Missouri and 650 South Meridian Road,
Austintown, Ohio, an appraisal dated as of a current date, by a
certified M.A.I. appraiser experienced in appraising Health Care
Facilities certifying the Appraised Value of such Health Care
Facilities,
(xii) except as set forth in the Supplemental Schedule,
a copy of the most current "phase I" environmental audit of the
Borrower Fee Property related to such Operator Lease, which audit
shall have been performed by a qualified environmental consulting
firm and, except as set forth in the Supplemental Schedule, shall
substantially conform with ASTM E 1527, together with a copy of any
other environmental audits, assessments and information with
respect to any environmental remediation conducted with respect to
such property performed subsequent to the date of such audit,
(xiii) evidence of insurance meeting the requirements of
Section 5.03(d), except for any noncompliance with Section 5.03(d)
identified in the Supplemental Schedule, reflecting the interests
of the Operator, the Borrower and the interest of the Agent, as
applicable,
(xiv) a certificate of an officer of the Borrower (A)
setting forth the calculations necessary to establish compliance
with the concentration limitations set forth in clause (h) of the
definition of Eligible Operator Lease, (B) certifying that each of
the Operator Leases and related Borrower Fee Properties set forth
in the Initial Borrowing Base Report are Eligible Operator Leases,
and (C) certifying that, all of the deliveries made pursuant to
this Section 3.02(a) are consistent with the Required Documentation
Standards.
(b) Eligible Operator Loans. The following documents with
respect to each such Operator Loan:
(i) a copy of each Operator Loan Document executed and/or
delivered to the Borrower by the Operator in connection with such
Operator Loan,
(ii) a Collateral Assignment of Loan Documents in the
form of Exhibit K attached hereto, executed by the Borrower in
favor of the Agent for the benefit of the Banks which shall amend,
restate and replace any existing collateral assignment document in
respect of such Operator Loan and the Operator Loan Documents
related thereto,
(iii) the original promissory note executed by the
Operator in favor of the Borrower,
(iv) a copy of the file-stamped copy of the mortgage
executed by an Operator in favor of the Borrower and any financing
statements or other documents filed in favor of the Borrower in
connection with such Operator Loan,
(v) a survey, certified to the Agent (except as set forth
in the Supplemental Schedule), to the Borrower and to the Title
Company, which (A) shall show no easements, encroachments or other
title defects, except those which do not result in a Material
Impairment and in such form as to cause the Title Company to remove
the standard survey exception from the title insurance policy in
favor of the Borrower and assigned to the Agent for the benefit of
the Banks, (B) shall be an ALTA survey (except as set forth in the
Supplemental Schedule), and (C) shall properly certify whether the
Operator Fee Property in respect of such Operator Loan is located
in a "100-year flood plain" as defined by the Flood Disaster
Protection Act of 1973, as amended from time to time (the "Flood
Disaster Act") (except as set forth in the Supplemental Schedule);
provided, however, with respect to Operator Fee Properties
appearing on the Supplemental Schedule pursuant to sub-paragraph
(C) above, the Borrower shall deliver, on or before October 10,
1994, evidence satisfactory to each of the Banks that either (1)
each such Operator Fee Property is not located in a "100-year flood
plain" as defined by the Flood Disaster Act, or (2) if such
Operator Fee Property is located in a "100-year flood plain" as
defined by the Flood Disaster Act, such Operator Fee Property is
properly insured with flood insurance made available under the
National Flood Insurance Act of 1968; provided, further, any
non-compliance with the Required Documentation Standards as to the
Operator Fee Properties appearing on the Supplemental Schedule
pursuant to sub-paragraph (B) or (C) above shall not cause the
Operator Loan in respect of such Operator Fee Property to fail to
be an Eligible Operator Loan so long as the other requirements of
this clause (v) have been met,
(vi) a copy of each ALTA title policy insuring the Lien
of the mortgage granted in favor of the Borrower in connection with
such Operator Loan, issued by the Title Company, in favor of the
Borrower, reflecting no encumbrances, defects in title or other
matters which could have Material Impairment, together with an
endorsement to such policy reflecting the Collateral Assignment of
Loan Documents and naming the Agent for the benefit of the Banks,
as the insured,
(vii) with respect to each Health Care Facility, within
thirty (30) Business Days after the Closing Date, a copy of the
most current appraisal performed by a certified M.A.I. appraiser
experienced in appraising Health Care Facilities certifying the
Appraised Value of such Health Care Facilities and dated no earlier
than July 31, 1991, and with respect to the Health Care Facilities
located at 3501 Executive Parkway, Toledo, Ohio and 11300 U.S. 19
South, Clearwater, Florida, an appraisal, dated as of a current
date, by a certified M.A.I. appraiser experienced in appraising
Health Care Facilities certifying the Appraised Value of such
Health Care Facilities,
(viii) except as set forth in the Supplemental Schedule,
a copy of the most current "phase I" environmental audit of the
Operator Fee Property related to such Operator Loan, which audit
shall have been performed by a qualified environmental consulting
firm and, except as set forth in the Supplemental Schedule, shall
substantially conform with ASTM E 1527, together with a copy of any
other environmental audits, assessments and information with
respect to any environmental remediation conducted with respect to
such property performed subsequent to the date of such audit,
(ix) except as set forth in the Supplemental Schedule, a
copy of each opinion letter received by the Borrower in connection
with such Eligible Operator Loan,
(x) a certificate of insurance reflecting the Borrower
and the Agent as additional insured and loss payee, each as its
interest may appear and otherwise conforming with Section 5.03(d)
except such nonconformity with Section 5.03(d) as identified in the
Supplemental Schedule,
(xi) except as set forth in the Supplemental Schedule, a
copy of any letter of credit, pledge agreement with respect to cash
collateral or guaranty in favor of the Borrower, in an amount equal
to at least three (3) months principal and interest payments or two
and one-half percent (2 -1/2%) of the aggregate principal amount of
such Operator Loan or such lesser amount as is identified in the
Supplemental Schedule,
(xii) except as set forth in the Supplemental Schedules,
a copy of any borrower's estoppel letter,
(xiii) file-stamped copies of UCC-1 financing statements
on file with respect to such Operator Loan, executed UCC-1
financing statements or UCC-3 assignments of existing financing
statements, as the case may be, executed by the Borrower in favor
of the Agent for the benefit of the Banks,
(xiv) a certificate of an officer of the Borrower (A)
setting forth the calculations necessary to establish compliance
with the concentration limitations set forth in clause (h) of the
definition of Eligible Operator Loans, (B) certifying that each of
the Operator Loans set forth in the Initial Borrowing Base Report
are Eligible Operator Loans and (C) certifying that, all of the
deliveries made pursuant to this Section 3.02(b) are consistent
with the Required Documentation Standards.
(c) Cross Collateralized Loans. With respect to Cross-
Collateralized Loans:
(i) each material Operator Loan Document thereto,
(ii) a Collateral Assignment of Operator Loan Documents,
substantially in the form of Exhibit K hereto, executed by the
Borrower in favor of the Agent for the benefit of the Banks,
(iii) file-stamped copies of UCC-1 financing statements
on file with respect to such Operator Loan, executed UCC-1
financing statements or UCC-3 assignments of existing financing
statements, as the case may be, executed by the Borrower in favor
of the Agent for the benefit of the Banks.
(d) Filings for Perfection. Evidence satisfactory to the
Agent that this Agreement, each of the Borrower Mortgages, each
Collateral Assignment of Operator Loan Documents, each Collateral
Assignment of Operator Lease Documents, each UCC-1 financing
statements (with respect to fixtures), UCC-1 financing statements
(with respect to general intangibles and instruments), each UCC-3
financing statement and any other document required by law or
reasonably requested by the Agent or any Bank to be filed,
registered or recorded in order to create or continue, in favor of
the Agent for the benefit of the Banks, a first perfected Lien
(except to the extent otherwise permitted by this Agreement) on the
Collateral described therein, have been delivered for filing,
registration or recordation in each jurisdiction and with each
governmental authority in which the filing, registration or
recordation thereof is so required or requested and the Agent shall
have received verbal confirmation from the applicable offices of
the Title Company that all such documents have been filed,
registered or recorded; provided, however, that the UCC-3
assignments delivered pursuant to Sections 3.02(a)(x), 3.02(b)(iv)
and 3.02(c)(iii) shall be filed by the Agent and shall become
effective only upon the written request of the Majority Banks.
SECTION 3.03 Addition of Borrowing Base Assets -
Deliveries. With respect to each Operator Lease or Operator Loan
(and any Cross-Collateralized Loan with respect thereto) which the
Borrower intends to add as a Borrowing Base Asset on a Borrowing
Base Report subsequent to the Closing Date, the Agent shall have
received from the Borrower the following items, each of which,
unless otherwise indicated, shall be consistent with the Required
Documentation Standards:
(a) Operator Leases. With respect to Operator Leases:
(i) each Operator Lease and each Operator Lease Documents
related thereto,
(ii) a Notice of Borrowing Base Addition/Removal,
together with a Borrowing Base Report reflecting the effect of the
addition of such Operator Lease as a Borrowing Base Asset (a copy
of which notice and report shall be forwarded to the Banks by the
Agent),
(iii) a Collateral Assignment of Operator Lease Documents
and a Security Agreement Amendment, each executed by the Borrower
in favor of the Agent for the benefit of the Banks,
(iv) to the extent received by the Borrower, a lessee's
estoppel letter executed by such Operator in favor of the Agent for
the benefit of the Banks,
(v) an opinion of Borrower's counsel in favor of the
Agent for the benefit of the Banks as to the due authorization,
execution and enforceability of any Borrower Mortgage and any
Collateral Assignment of Operator Lease Documents against the
Borrower in accordance with its terms (as to matters of Ohio law or
other applicable law to the extent comparable to Ohio law in
relevant part), subject to customary qualifications as to
bankruptcy, insolvency, equitable principles and limitations based
on commercial reasonableness, good faith and fair dealing and the
perfection of the security interest perfected by the filing of UCC-
1 financing statements,
(vi) a copy of the opinion of counsel to the Operator
with respect to each Operator Lease, if any, as to the
enforceability of such Operator Lease against such Operator, which
letter shall permit reliance thereon by assignees of the Borrower
(including the Agent and the Banks) or such counsel shall provide
a reliance letter in favor of the Agent for the benefit of the
Banks entitling the Agent and the Banks to rely on such opinion
letter,
(vii) copy of the letter of credit, pledge agreement
with respect to cash collateral (together with evidence that such
cash collateral has been deposited for the benefit of the Borrower)
or guaranty in favor of the Borrower, in an amount equal to two and
one-half percent (2-1/2%) of the total lease payments due under
such Operator Lease;
(viii) a file-stamped copy of a Borrower Mortgage,
executed by the Borrower in favor of the Agent for the benefit of
the Banks and filed in the appropriate jurisdiction (with the
recording information to be forwarded to the Agent promptly upon
receipt thereof),
(ix) an ALTA survey, certified to the Borrower, to the
Agent and to the Title Company, which shall reflect whether the
Borrower Fee Property in respect of such Operator Lease is located
in a "100-year flood plain" as defined in the Flood Disaster Act
which shall show no easements, encroachments or other title
defects, except those which do not result in a Material Impairment
and in such form as to cause the title insurance company to issue
the ALTA title insurance policy required by Section 3.03(a)(x)
below and to remove the standard survey exception from the title
insurance policy in favor of the Agent,
(x) an ALTA title insurance policy (or commitment with
the policy to be delivered upon receipt), in ALTA Form B-1970
(Revised 10-17-70 but without the 10-17-84 revisions) or, if such
form is not legally available for insurance in the state in which
the Borrower Fee Property with respect to such Operator Lease is
located, such other form and/or such other endorsements as the
Agent shall require, issued by the Title Company in favor of the
Agent for the benefit of the Banks, without the "standard" or
presumed exceptions for rights of parties in possession, mechanic's
liens, matters which would be disclosed by an accurate survey and
inspection of the real property in question, and special taxes and
assessments, reflecting no title defects, survey matters or
encumbrances which could result in a Material Impairment and with
the following endorsements: (A) a revolving credit endorsement, (B)
a "last dollar" endorsement if necessary to ensure that the title
insurance coverage provided under such policy insures that the
Borrower Mortgage secures the last dollar of the Obligations, (if
necessary), (C) an ALTA Form 9 "comprehensive" endorsement, (D) an
endorsement to the effect that the Borrower Fee Property subject to
the insured mortgage is the real property shown on the survey
(required pursuant to Section 3.03(a)(ix) above, (E) affirmative
assurance that such real property has vehicle access to a dedicated
public street and (F) any other affirmative assurances and
endorsements contained in the Title Policy in favor of the
Borrower,
(xi) file-stamped copies of UCC-1 financing statements
(fixtures and general intangibles) executed by the Borrower in
favor of the Agent for the benefit of the Banks, and filed in the
appropriate jurisdiction (with recording information to be
forwarded to the Agent promptly upon receipt thereof) and UCC-3
financing statements (assigning any UCC-1 financing statements
filed by the Borrower in respect of such Operator Lease) executed
by the Borrower in favor of the Agent for the benefit of the Banks,
(xii) a copy of the appraisal performed by a certified
M.A.I. appraiser experienced in appraising Health Care Facilities
certifying the Appraised Value of such property,
(xiii) a copy of a "phase I" environmental audit of the
Borrower Fee Property related to such Operator Lease, which audit
shall have been performed by a qualified environmental consulting
firm and shall substantially conform with ASTM E 1527 and shall be
the most current "phase I" environmental audit conducted on the
property, together with a copy of any other environmental audits,
assessments and information with respect to any environmental
remediation conducted with respect to such property performed
subsequent to the date of such audit,
(xiv) financial statements for the current fiscal year of
the Operator and of each Guarantor of the Operator with respect to
such fiscal year, and historical financial statements for at least
the immediately preceding two (2) fiscal years of the Operator and
each Guarantor of the Operator, each such financial statements
shall fairly present the business and results of operations of the
Operator and the Health Care Facility in question,
(xv) evidence of insurance meeting the requirements of
Section 5.03(d) reflecting the interests of the Operator, the
Borrower and the interest of the Agent, as applicable,
(xvi) a summary in respect of such Operator Lease, the
Health Care Facility with respect to such Operator Lease, the
related Operator Fee Property and Operator: (A) describing the
facility, (B) describing and summarizing the terms of the Operator
Lease, (C) itemizing any other Operator Loans or other Operator
Leases with respect to such Operator, (D) containing current and
historical financial information and any projected financial
information provided by the Operator and such Guarantor, (E)
summarizing the Borrower's financial analysis of the Operator and
any Guarantors based upon the Operator's and any Guarantor's
financial statements, as the case may be, (F) summarizing the
appraisal and attaching the summary pages thereof, (G) summarizing
each environmental audit with respect to the site and attaching the
summary pages thereof, (H) analyzing the suitability of the
facility and evidencing that the requirements of paragraph (g) of
the requirements for a Qualified Investment have been met and (I)
summarizing the Borrower's reasonable business conclusions based
upon the recommendations and conclusions of a qualified
environmental consultant as to the effect of any noncompliance with
Environmental Laws set forth in the environmental audit delivered
to the Agent and reasonably demonstrating why any such
noncompliance will not result in a Material Impairment,
(xvii) a certificate of an officer of the Borrower: (A)
setting forth and certifying the accuracy of the calculations
necessary to establish compliance with the concentration
limitations set forth in clause (h) of the definition of Eligible
Operator Lease, (B) certifying that such Operator Lease is an
Eligible Operator Lease and (C) certifying that, to the best of
such officer's knowledge, all statements made in the summary
referenced in clause (xvi) above are true and correct and that such
summary does not fail to state any material fact.
(b) Operator Loans. With respect to each such Operator Loan:
(i) a Notice of Borrowing Base Addition/Removal, together
with a Borrowing Base Report reflecting the effect of the addition
of such Operator Loan as a Borrowing Base Asset (a copy of which
notice and report shall be forwarded to the Agent by the Banks),
(ii) a file-stamped copy of the Collateral Assignment of
Operator Loan Documents executed by the Borrower in favor of the
Agent for the benefit of the Banks and filed in the appropriate
jurisdiction (with recording information to be forwarded to the
Agent promptly upon the receipt thereof) and a Security Agreement
Amendment, executed by the Borrower in favor of the Agent for the
benefit of the Banks together with file-stamped copies of UCC-1
financing statements (general intangibles) with respect to such
Operator Loan Documents,
(iii) the original promissory note executed by the
Operator in favor of the Borrower,
(iv) a file-stamped copy of the mortgage and any
financing statements filed in favor of the Borrower in connection
with such Operator Loan together with UCC-3 assignments with
respect to such financing statements executed (but not filed) by
the Borrower in favor of the Agent for the benefit of the Banks,
(v) a copy of each other Eligible Operator Loan Document
executed and/or delivered to the Borrower by the Operator in
connection such Eligible Operator Loan,
(vi) a copy of each opinion letter received by the
Borrower in connection with such Eligible Operator Loan stating
that the Operator Loan Documents are enforceable obligations of the
Operator, which opinion letter shall permit assignees of the
Borrower to rely thereon or such counsel shall deliver a separate
a reliance letter in favor of the Agent for the benefit of the
Banks entitling the Agent and the Banks to rely on such opinion
letter,
(vii) a copy of the letter of credit, pledge agreement
with respect to cash collateral (together with evidence that such
cash collateral has been deposited for the benefit of the Borrower)
or guaranty for the account of the Borrower, in an amount equal to
two and one-half percent (2-1/2%) of the aggregate principal amount
due with respect to the Operator Loan;
(viii) an ALTA survey, certified to the Borrower, to the
Agent and to the Title Company, which shall reflect whether the
Operator Fee in respect of such Operator Loan is located in a "100-
year flood plain" as defined in the Flood Disaster Act and which
shall show no easements, encroachments or other title defects,
except those which do not result in a Material Impairment and in
such form as to cause the title insurance company to issue the ALTA
title insurance policy required by Section 3.03(a)(ix) below and to
remove the standard survey exception from the title insurance
policy in favor of the Agent,
(ix) a copy of each ALTA title policy insuring the Lien
of the mortgage granted in favor of the Borrower in connection with
such Operator Loan, in ALTA Form B-1970 (revised 10-17-90 but
without the 10-17-84 revisions), or, if such form is not legally
available in the state in which the Operator Fee Property is
located, on such other Form as is customarily issued in such state,
issued by the Title Company, in favor of the Borrower reflecting no
encumbrances, defects in title or other matters which could have
Material Impairment, together with a separate endorsement to such
policy reflecting the Collateral Assignment of Loan Documents and
naming the Agent for the benefit of the Banks, as the insured,
(x) a copy of the appraisal performed by a certified
M.A.I. appraiser experienced in appraising Health Care Facilities
certifying the Appraised Value of such property,
(xi) a copy of a "phase I" environmental audit of the
Operator Fee Property related to such Operator Loan, which audit
shall have been performed by a qualified environmental consulting
firm and shall substantially conform with ASTM E 1527 and shall be
the most current "phase I" environmental audit conducted on the
property, together with a copy of any other environmental audits,
assessments and information with respect to any environmental
remediation conducted with respect to such property performed
subsequent to the date of such audit,
(xii) a certificate of insurance reflecting the Borrower
and the Agent as additional insured and loss payee, each as its
interests of the Borrower and the Agent, each as its interest may
appear and otherwise conforming with Section 5.03(d),
(xiii) financial statements for the current fiscal year
of the Operator and of each Guarantor of the Operator with respect
to such fiscal year, and historical financial statements for at
least the immediately preceding two (2) fiscal years of the
Operator and each Guarantor of the Operator, each of which shall
fairly present the business and results of operations of the
Operator and such Health Care Facility,
(xiv) to the extent received by the Borrower, a
borrower's estoppel letter, executed by the Operator,
(xv) a summary in respect of such Operator Loan, the
Health Care Facility with respect to such Operator Loan and the
related Operator Fee Property and Operator: (A) describing the
facility, (B) describing and summarizing the terms of the Operator
Loan, (C) itemizing any other Operator Loans or other Operator
Leases with respect to such Operator, (D) containing current and
historical financial information and any projected financial
information provided by the Operator and such Guarantor, (E)
summarizing the Borrower's financial analysis of the Operator and
any Guarantors based upon the Operator's or any Guarantor's
financial statements, as the case may be, (F) summarizing the
appraisal and attaching the summary pages thereof, (G) summarizing
each environmental audit with respect to the site and attaching the
summary pages thereof, (H) analyzing the suitability of the
facility and evidencing that the requirements of paragraph (g) of
the requirements for a Qualified Investment have been met and (I)
summarizing the Borrower's reasonable business conclusions based
upon the recommendations and conclusions of a qualified
environmental consultant as to the effect of any noncompliance with
Environmental Laws set forth in the environmental audit delivered
to the Agent and reasonably demonstrating why any such
noncompliance will not result in a Material Impairment,
(xvi) a certificate of an officer of the Borrower: (A)
setting forth and certifying the accuracy of the calculations
necessary to establish compliance with the concentration
limitations set forth in clause (h) of the definition of Eligible
Operator Loans, (B) certifying that each of the Operator Loans set
forth in the Borrowing Base Report are Eligible Operator Loans and
(C) certifying that, to the best of such officer's knowledge, all
statements made in the summary referenced in clause (xv) above are
true and correct and that such summary does not fail to state any
material fact.
(c) Cross Collateralized Loans. With respect to Cross-
Collateralized Loans:
(i) each material Operator Loan Document with respect
thereto,
(ii) a Collateral Assignment of Operator Loan Documents,
substantially in the form of Exhibit K hereto and a Security
Agreement Amendment, each executed by the Borrower in favor of the
Agent for the benefit of the Banks,
(iii) file-stamped copies of UCC-1 financing statements
on file with respect to such Operator Loan, file-stamped copies of
UCC-1 (general intangibles) executed by the Borrower with respect
to such Operator Loan Documents and or UCC-3 financing statements
assignment assigning existing financing statements executed (but
not filed) by the Borrower in favor of the Agent for the benefit of
the Banks.
(d) Filings for Perfection. Evidence that the Collateral
Assignments, Borrower Mortgages and UCC-1 financing statements
(with respect to fixtures), UCC-1 financing statements (general
intangibles), each UCC-3 financing statement, if any, and any other
document required by law or reasonably requested by the Agent or
any Bank to be filed, registered or recorded in order to create or
continue, in favor of the Agent for the benefit of the Banks, a
first perfected Lien (except to the extent otherwise permitted by
this Agreement) on the Collateral described therein, have been
delivered for filing, registration or recordation in each
jurisdiction and with each governmental authority in which the
filing, registration or recordation thereof is so required or
requested and the Agent has received written evidence that all such
filings, registrations or recordations have been made; provided,
however that, the UCC-3 Assignments delivered pursuant to Sections
3.03(a)(xi), 3.03(b)(iv) and 3.03(c)(iii) shall be filed by the
Agent and shall become effective only upon the request of the
Majority Banks.
SECTION 3.04 Conditions Precedent to all Revolving Credit
Loans.
(a) Bringdown of Representations and Warranties. The
obligation of each Bank to make a Loan on the occasion of (i) each
Revolving Credit Borrowing and (ii) each Rate Conversion or Rate
Continuation shall be subject to the further conditions precedent
that on the date of such Revolving Credit Borrowing the following
statements shall be true (and each of the giving of the applicable
Credit Request or Rate Conversion/Continuation Request and the
acceptance by the Borrower of the proceeds of such Revolving Credit
Borrowing, Rate Conversion or Rate Continuation shall constitute a
representation and warranty by the Borrower that on the date of
such Revolving Credit Borrowing, Rate Conversion or Rate
Continuation such statements are true):
(i) The representations and warranties contained in
Article IV are correct on and as of the date of such Revolving
Credit Borrowing, Rate Conversion or Rate Continuation, as the case
may be, before and after giving effect to such Revolving Credit
Borrowing, Rate Conversion or Rate Continuation, as the case may
be, and to the application of the proceeds therefrom, as though
made on and as of such date, and
(ii) No event has occurred and is continuing, or would
result from such Revolving Credit Borrowing or from the application
of the proceeds therefrom or from such Rate Continuation or Rate
Conversion, as the case may be, which constitutes a Default or an
Event of Default, and
(iii) Each then existing Subsidiary of the Borrower has
delivered to the Agent (i) a Guaranty Agreement, duly executed by
an authorized officer of such Subsidiary, (ii) a certificate in the
form of Exhibit G-2, (iii) certified copies of its organizational
documents and (iv) an opinion of counsel to such Subsidiary as to
the matters set forth in Section 3.01(g)(ii), and
(iv) In the case of a Revolving Credit Borrowing, the
proceeds of such Revolving Credit Borrowing will be used for the
purposes specified in Section 2.01(b), and
(v) There has been no event which has resulted or would,
more likely than not, result in a Material Adverse Effect.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
The Borrower represents and warrants to each of the Banks
as follows:
SECTION 4.01 Existence. The Borrower and each of its
Subsidiaries is duly organized, validly existing and in good
standing under the laws of the state of its incorporation. The
Supplemental Schedule sets forth the name and address of each of
the Borrower's Subsidiaries existing as of the Closing Date, the
chief executive office of each such Subsidiary and the jurisdiction
in which each such Subsidiary is incorporated. All of the
outstanding stock of each such Subsidiary and any other Subsidiary
of the Borrower created after the Closing Date is owned by the
Borrower and is fully paid and non-assessable and owned by the
Borrower free from any security interest, option, equity or other
right of any kind. The Borrower and each of its Subsidiaries is
duly qualified to transact business in each state or other
jurisdiction in which it owns or leases any real property or in
which the nature of the business conducted makes such qualification
necessary or, if not so qualified, such failure to qualify has
neither resulted nor would, more likely than not, result in a
Material Impairment or a Material Adverse Effect. Each Subsidiary
of the Borrower is a Wholly-Owned Subsidiary.
SECTION 4.02 Power, Authorization and Consent. The
execution, delivery and performance by the Borrower of this
Agreement and by the Borrower of all Related Writings to which it
is party and the creation of all liens and security interests
provided for herein or therein (a) are within the Borrower's legal
power and authority, (b) have been duly authorized by all necessary
or proper action of the Borrower, (c) do not require the consent or
approval of any governmental body, agency, authority or any other
Person which has not been obtained and a copy thereof furnished to
the Agent and (d) will not violate (i) any provision of Law
applicable to the Borrower, (ii) any provision of the Borrower's
Certificate of Incorporation or By-laws, or (iii) any material
agreement or material indenture by which the Borrower or any
Subsidiary of the Borrower or the property of the Borrower or any
such Subsidiary is bound, except where such violation specified in
this clause (iii) has neither resulted nor would, more likely than
not, result in a Material Adverse Effect or Material Impairment,
(e) will not result in the creation or imposition of any lien or
encumbrance on any property or assets of the Borrower or any
Subsidiary of the Borrower except such Liens as are provided herein
or (f) will not result in the disqualification of the Borrower as
a REIT under Section 856 of the Internal Revenue Code. At the time
of execution of any Guaranty Agreement by any Subsidiary, the
execution, delivery and performance by such Subsidiary of such
Guaranty Agreement and of all Related Writings to which it is party
(A) are within the Subsidiary's legal power and authority, (b) have
been duly authorized by all necessary or proper action of such
Subsidiary, (c) do not require the consent or approval of any
governmental body, agency, authority or any other Person which has
not been obtained and a copy thereof furnished to the Agent and (d)
will not violate (i) any provision of Law applicable to the
Subsidiary, (ii) any provision of the Subsidiaries's Certificate or
Articles of Incorporation or By-laws or Regulations, or (iii) any
material agreement or material indenture by which the Subsidiary or
the property of such Subsidiary is bound, except where such
violation specified in this clause (iii) has neither resulted nor
would, more likely than not, result in a Materially Adverse Effect
or Material Impairment, (e) will not result in the creation or
imposition of any lien or encumbrance on any property or assets of
the Subsidiary such Liens as are provided herein or (f) will not
result in the disqualification of the Borrower as a REIT under
Section 856 of the Internal Revenue Code. No filing or registration
with or payment to any Person is required to be obtained or made on
or prior to the Closing Date in connection with the execution,
delivery and performance by the Borrower of this Agreement, the
Collateral Documents or any other Related Writing or the
transactions contemplated hereby or thereby or as a condition to
the legality, validity or enforceability of the Borrower's
obligations under this Agreement, the Collateral Documents or any
Related Writing or compliance with the terms and provisions of this
Agreement, Collateral Documents or any Related Writing executed and
delivered prior to, on or after the Closing Date, except for (i)
the recording of the Borrower Mortgages, the Collateral Assignment
of Operator Loan Documents and the filing of UCC financing
statements perfecting the interest of the Agent in and to the
Collateral or assigning to the Agent the interest of the Borrower
in and to the Collateral and (ii) such additional filings,
recordings, payment of filing fees and the like as may be necessary
(x) to continue any assignment or Lien created in respect of the
Collateral or (y) to perfect any Lien in respect of any Borrower
Fee Property, Operator Lease or Operator Loan which becomes a
Borrowing Base Asset after the Closing Date. No filing or
registration with or payment to any Person is required to be
obtained or made on or prior to the date upon which any Guaranty
Agreement is executed by a Subsidiary of the Borrower in connection
with the execution, delivery and performance by such Subsidiary of
such Guaranty Agreement or any other Related Writing or the
transactions contemplated thereby or as a condition to the
legality, validity or enforceability of such Subsidiary's
obligations under such Guaranty Agreement or compliance with the
terms and provisions thereof.
SECTION 4.03 Enforceability. This Agreement constitutes
and the Collateral Documents when duly executed will constitute,
the legal, valid and binding obligations of the Borrower,
enforceable against the Borrower, in accordance with its respective
terms subject to any applicable insolvency or bankruptcy law of
general applicability and general principles of equity and any
limitations imposed by standards of commercial reasonableness, good
faith and fair dealing. Each Guaranty Agreement, upon the
execution and delivery thereof, constitutes the legal, valid and
binding obligations of Subsidiary which is a party thereto,
enforceable against such Subsidiary, in accordance with its
respective terms subject to any applicable insolvency or bankruptcy
law of general applicability and general principles of equity and
any limitations imposed by standards of commercial reasonableness,
good faith and fair dealing.
SECTION 4.04 Litigation; Proceedings. No action, suit,
investigation or proceeding is now pending or, to the knowledge of
Borrower, threatened against the Borrower or any of its
Subsidiaries at law, in equity or otherwise, or with respect to
this Agreement or any Related Writing, before any court, board,
commission, agency or instrumentality of any federal, state, local
or foreign government or of any agency or subdivision thereof, or
before any arbitrator or panel of arbitrators which has resulted or
would, more likely than not, result in a Material Adverse Effect.
SECTION 4.05 Taxes. As of the Closing Date, the Borrower
and each of its Subsidiaries has filed all federal, state and local
tax returns which are required to be filed by it and paid all taxes
due as shown thereon, including interest and penalties (except to
the extent, if any, permitted by Section 5.03(a)). The charges,
accruals and reserves on the books of the Borrower in respect of
taxes or other governmental charges, if any, are adequate. No tax
Liens have been filed with respect to the Borrower or any of its
Subsidiaries and no claims material to the Borrower or any of its
Subsidiaries are being asserted against the Borrower with respect
to any taxes or governmental charges, except for Liens for taxes,
assessments and governmental charges which are not yet due and
payable. With respect to each federal income tax return of the
Borrower, the statute of limitations for the assessment of such
taxes has expired through the taxable year ended December 31, 1990
and no audit is in progress and no extension of time is in force
with respect to any date on which any such return was or is to be
filed and no waiver or agreement is in force for the extension of
time for the assessment or payment of any tax.
SECTION 4.06 Title. The Borrower (a) has good and
marketable fee title to each item of real property constituting a
Borrower Fee Property, (b) has good and marketable title to each
item of Collateral and (c) has good and marketable title to all of
its other respective material properties and assets of any nature
whatsoever (including patents, trademarks, trade names, service
marks and copyrights) free and clear, in each case, of all Liens
(including infringement claims with respect to patents, trademarks,
trade names, service marks and copyrights) except Liens that are
expressly permitted by Section 5.04(e) and except that the "Health
Care REIT" and "Health Care Fund" trade names are owned by the
Manager.
SECTION 4.07 ERISA. The Supplemental Schedule sets forth
all of the Employee Benefit Plans of the Borrower and its ERISA
Affiliates. No Accumulated Funding Deficiency exists in respect of
any Employee Benefit Plan of Borrower or any of its ERISA
Affiliates which exceeds One Hundred Thousand Dollars ($100,000).
No Reportable Event has occurred in respect of any Employee Benefit
Plan which is continuing and which (i) constitutes grounds either
for termination of the plan or for court appointment of a trustee
for the administration thereof or (ii) has resulted or would, more
likely than not, result in a Material Adverse Effect. No
"prohibited transaction" (as defined in Section 406 of ERISA or
Section 4975 of the Internal Revenue Code of 1986, as amended), has
occurred nor has the Borrower nor any of its ERISA Affiliates
incurred a liability that has resulted or would, more likely than
not, result in Material Adverse Effect. None of the Borrower or any
of its ERISA Affiliates has (i) had an obligation to contribute to
any Multiemployer Plan, as defined in Section 4001(a)(3) of ERISA,
since 1987 or (ii) incurred or reasonably expects to incur any
liability for the withdrawal from such a Multiemployer Plan which
liability has resulted or would, more likely than not, result in
Material Adverse Effect.
SECTION 4.08 Adverse Obligations; Labor Disputes.
Neither the Borrower nor any of its Subsidiaries is subject to any
contract, agreement, corporate restriction, judgment, decree or
order materially and adversely affecting its business, property,
assets, operations or condition, financial or otherwise, is a party
to any labor dispute, and, there are no strikes, slow downs,
walkouts or other concerted interruptions of operations by
employees whether or not relating to any labor contracts which have
resulted or would, more likely than not, result in a Material
Adverse Effect.
SECTION 4.09 Financial Statements. The Borrower's
audited financial statements for the Fiscal Years ended December
31, 1990, 1991, 1992 and 1993, certified by Ernst & Young, and the
Borrower's unaudited interim financial statements prepared as at
March 31, 1994, each of which has been heretofore furnished by the
Borrower to each Bank (i) have been prepared in accordance with
generally accepted accounting principles applied on a consistent
basis with those used by it during the immediately preceding fiscal
year except to the extent, if any, specifically noted therein and
(ii) fairly present in all material respects (subject to routine
year-end audit adjustments in the case of the unaudited financial
statements) the consolidating and consolidated financial condition
of the Borrower and its Subsidiaries as of the respective dates
thereof (including a full disclosure of material liabilities, if
any) and the consolidating and consolidated results of their
operations, if any, for the respective fiscal periods then ending.
As of the Closing Date, there has been no material adverse change
in the financial condition, properties or business of the Borrower
or any of its Subsidiaries since the December 31, 1993 financial
statements nor any change in the Borrower's accounting procedures
since the end of the Borrower's latest full fiscal year.
SECTION 4.10 Insurance. As of the Closing Date, the
insurance coverage of the Operators consists of those insurance
policies disclosed on the Supplemental Schedule as required by and
set forth in Section 5.03(d) hereto and in the Collateral
Documents.
SECTION 4.11 Solvency. The Borrower and each of its
Subsidiaries is Solvent.
SECTION 4.12 Investment Company Act Status. Neither the
Borrower nor any of its Subsidiaries is an "investment company" or
an "affiliated person" of, or "promoter" or "principal underwriter"
for, an "investment company", as such terms are defined in the
Investment Company Act of 1940, as amended (15 U.S.C. Section 80(a)(1), et
seq.).
SECTION 4.13 Regulation G/Regulation U/Regulation X
Compliance. Neither the Borrower nor any of its Subsidiaries is
engaged principally, or as one of its important activities, in the
business of extending credit for the purpose of purchasing or
carrying "margin stock" (as defined by Regulation U of the Board of
Governors of the Federal Reserve System of the United States (as
amended from time to time) and all official rulings and
interpretations thereunder or thereof. No part of the proceeds of
any Revolving Credit Loan will be used, whether directly or
indirectly, and whether immediately, incidentally or ultimately,
(i) to purchase or to extend credit to others for the purpose of
purchasing "margin stock", or to carry or to extend credit to
others for the purpose of carrying stock which will be "margin
stock" after giving effect to the Revolving Credit Loans or (ii)
for any purpose that entails a violation of, or is inconsistent
with, the provisions of the Regulations of the Board of Governors
of the Federal Reserve System of the United States, including
Regulation G, U or X.
SECTION 4.14 Environmental Compliance. Each Health Care
Facility or other real property in which the Borrower or any
Subsidiary of the Borrower has a real property interest (whether as
fee owner, operator, lessor, lessee, mortgagee or otherwise) is in
material compliance with Environmental Laws except where such
noncompliance, taken singly or taken together with all other
noncompliance with Environmental Laws, has neither resulted nor
would, more likely than not, result in a Material Adverse Effect.
There is no noncompliance with any Environmental Law or existence
of any environmental condition which, when taken singly or in the
aggregate, has resulted or would, more likely than not, result in
a Material Adverse Effect. With respect to each Borrower Fee
Property in respect of an Eligible Operator Lease (a) there are no
pending or threatened Environmental Claims against the Borrower or
against any Operator under any Operator Lease or any other
environmental condition with respect to any Borrower Fee Property
or Operator Fee Property which, taken singly or taken together with
all pending or threatened Environmental Claims, has resulted or
would, more likely than not, result in a Material Adverse Effect,
(b) the Borrower and each Operator under an Operator Lease has been
issued and is in compliance with all Environmental Permits except
where noncompliance, whether taken singly or taken together with
all other noncompliance with Environmental Permits, has resulted or
would, more likely than not, result in a Material Adverse Effect,
(c) Hazardous Materials have not been released or disposed of on
any such Borrower Fee Property or, to the best knowledge of the
Borrower, any property adjoining any such properties which, in
either case, whether taken singly or taken together with all other
releases or dispositions of Hazardous Materials, has resulted or
would, more likely than not, result in a Material Adverse Effect.
With respect to each Operator Fee Property in respect of any
Eligible Operator Loan (a) there are no pending or threatened
Environmental Claims against the Operator which, when taken singly
or taken together with all other pending or threatened
Environmental Claims, have resulted or would, more likely than not,
result in a Material Adverse Effect, (b) the Operator has been
issued and is in compliance with all Environmental Permits except
to the extent such noncompliance, when taken singly or in the
aggregate with all other such noncompliance, has neither resulted
nor would, more likely than not, result in a Material Adverse
Effect, (c) Hazardous Materials have not been released or disposed
of on any such Operator Fee Property or, to the best knowledge of
the Borrower, any property adjoining any such properties which, in
either case, when taken singly or taken with all other releases or
dispositions of Hazardous Materials, has resulted or would, more
likely than not, result in a Material Adverse Effect. No property
now owned, operated, or leased, directly or indirectly, by the
Borrower and no Operator Fee Property in respect of any Eligible
Operator Loan is listed or proposed for listing on the National
Priorities List pursuant to CERCLA, on the CERCLIS or on any
similar federal or state list of sites requiring investigation or
clean-up. There are no underground storage tanks, active or
abandoned, including petroleum storage tanks, landfills, lagoons,
surface impoundments, disposal areas or disposal ponds, on or under
any property now owned, operated or leased, directly or indirectly,
by the Borrower or any of its Subsidiaries, or on or under any
Operator Fee Property in respect of any Eligible Operator Loan that
are in violation of any applicable Environmental Law except where
such violation, taken singly or taken together with all other such
violations of Environmental Laws, has neither resulted nor would,
more likely than not, result in a Material Adverse Effect. The
Borrower has not and each of its Subsidiaries has not directly
transported or directly arranged for the transportation of any
Hazardous Material to any location which is listed or proposed for
listing on the National Priorities List pursuant to CERCLA, on the
CERCLIS or on any similar federal or state list or which is the
subject of any federal, state or local enforcement actions or other
investigations which may lead to claims against the Borrower or any
of its Subsidiaries for any remedial work, damage to natural
resources or personal injury, including claims under CERCLA except
where such actions, taken singly or in the aggregate, have neither
resulted nor would, more likely than not, result in a Material
Adverse Effect. There are no polychlorinated biphenyls or friable
asbestos present at any property now owned, operated or leased,
directly or indirectly, by the Borrower or any of its Subsidiaries,
or at any Operator Fee Property in respect of any Eligible Operator
Loan in violation of any applicable Environmental Law where such
violation, taken singly or taken together with all such violations,
has resulted or would, more likely than not, result in a Material
Adverse Effect. No conditions exist at, on or under any property
now owned, operated, or leased, directly or indirectly, by the
Borrower or any of its Subsidiaries, or at, on or under any
Operator Fee Property in respect of an Eligible Operator Loan,
which, with the passage of time, or the giving of notice or both,
would give rise to liability under any Environmental Law which
liability, taken singly or together with all other such
liabilities, has resulted or would, more likely than not, result in
a Material Adverse Effect. No generation, manufacture, storage,
treatment, transportation or disposal of Hazardous Material has
occurred or is occurring on or from any property owned, operated,
or leased by the Borrower or any of its Subsidiaries, or on or from
any Operator Fee Property in respect of an Eligible Operator Loan
which, when taken singly or taken together with all such
generation, manufacture, storage, treatment, transportation or
disposal, has resulted or would, more likely than not, result in a
Material Adverse Effect.
SECTION 4.15 Environmental Laws and Permits. Without
limiting the representations made in Section 4.14, to the best
knowledge of the Borrower, there are no circumstances with respect
to any Borrower Fee Property or Operator Fee Property or the
operations of the Borrower or any of its Subsidiaries that could
reasonably be anticipated (i) to form the basis of an Environmental
Claim against the Borrower or any of its Subsidiaries or any
Borrower Fee Property or any Operator Fee Property that, taken
singly or together with all such circumstances, has resulted or
would, more likely than not, result in a Material Adverse Effect or
(ii) to cause any Health Care Facility owned, leased or funded by
the Borrower or any of its Subsidiaries or any Borrower Fee
Property or Operator Fee Property to be subject to any restrictions
on ownership, occupancy, use or transferability under any
applicable Environmental Law which have resulted or would, more
likely than not, result in a Material Adverse Effect.
SECTION 4.16 Compliance with Laws. Without limiting the
representations made in Sections 4.14 and 4.15, neither the
Borrower, nor any Subsidiary of the Borrower, nor, to the best
knowledge of the Borrower, any Operator of a Borrower Fee Property
or any owner or operator of any Operator Fee Property, is in
violation of any Law applicable to the business or properties of
the Borrower or any Subsidiary of the Borrower, except for such
minor and isolated violations when taken singly or in the aggregate
have neither resulted nor would, more likely than not, result in a
Material Adverse Effect.
SECTION 4.17 Condemnation Proceedings. There is no
condemnation proceeding pending or, to the best knowledge of the
Borrower, threatened against any Borrower Fee Property or any real
property of any Subsidiary of the Borrower. There is no
condemnation proceeding pending or, to the best knowledge of the
Borrower, threatened against any Operator Fee Property. The
improvements located on each Borrower Fee Property, each parcel of
real property owned by a Subsidiary of the Borrower and each
Operator Fee Property are in good condition and repair. No such
improvement is in material violation of any applicable zoning law
or ordinance.
SECTION 4.18 Locations. With respect to each Operator
Lease and Operator Loan which is to be listed on the Initial
Borrowing Base Report as a Borrowing Base Asset on the Closing
Date, Schedule II sets forth, the full name and address of each
Operator, each fee owner of any Operator Fee Property and the
appropriate location for the filing of Collateral Documents with
respect thereto. With respect to each Operator Lease and Operator
Loan which are not listed on the Initial Borrowing Base Report
which are listed on a Borrowing Base Report after the Closing Date,
the Borrower has informed the Agent and the Banks in writing of the
full name and address of the Operator, the name of each fee owner
of Operator Fee Property and the appropriate location for the
filing of the Collateral Documents with respect to such Operator
Lease or Operator Loan.
SECTION 4.19 Material Contracts. As of the Closing Date,
each material contract of the Borrower or any Subsidiary of the
Borrower, including, without limitation, the Senior Note Documents,
the Management Agreement, each Eligible Operator Lease Document,
each Eligible Operator Loan Document, has been duly authorized,
executed and delivered by all parties thereto, has not been amended
or otherwise modified, is in full force and effect and is binding
upon and enforceable against all parties thereto in accordance with
its terms (subject to limitations imposed by general principles of
equity (regardless whether such enforceability is considered in a
proceeding at law or in equity) and the effect of applicable
bankruptcy, reorganization, insolvency, moratorium and similar laws
of general application relating to or affecting creditors' rights)
subject to customary qualifications as to bankruptcy, insolvency,
equitable principles and limitations based on commercial
reasonableness, good faith and fair dealing. As of the Closing
Date, the Borrower is not in default under the Senior Note
Documents and no condition exists which, with the giving of notice
or the passage of time or both, would constitute a default
thereunder.
SECTION 4.20 Full Disclosure. No information, exhibits or
reports furnished by the Borrower or any of its Subsidiaries to the
Agent or any Bank, including, without limitation, the 1993 annual
report of the Borrower, omits to state any fact necessary to make
the statements contained therein not materially misleading in light
of the circumstances and purposes for which such information was
provided. The Borrower and each of its Subsidiaries has provided
all information requested by the Agent or any Bank and all such
information is complete and accurate in all material respects.
SECTION 4.21 Liabilities. As of the Closing Date, except
for trade payables, payroll not yet due and payable, and real
estate, personal property and other similar taxes not yet due and
payable arising in the ordinary course of the business of the
Borrower and each of its Subsidiaries, neither the Borrower nor any
of its Subsidiaries has liabilities, direct or contingent, not
disclosed in the Borrower's financial statements referred to in
Section 4.09 or in the Supplemental Schedule.
SECTION 4.22 Status of the Borrower. The Borrower is
validly qualified as a REIT under Section 856 of the Internal
Revenue Code. The Borrower, its Subsidiaries, and, to the extent
necessary, the Manager, each own or hold all such licenses and
permits as are necessary or desirable in the conduct of its
business.
SECTION 4.23 Qualified Investment; Eligibility. Each of
the Borrower's Balance Sheet Assets which is not a Borrowing Base
Asset is a Qualified Investment except for any variance of any such
asset from any of the criteria set forth in the definition of
Qualified Investment which (i) was approved by the Borrower in the
exercise of the Borrower's reasonably prudent business judgment
consistent with the Borrower's past practices, (ii) was approved by
the Borrower's Board of Directors or Investment Committee of the
Borrower's Board of Directors and (iii) has neither resulted nor
would, more likely than not, result in a Material Adverse Effect or
to materially and adversely affect the condition, value, ownership,
transferability or use of any such asset. Except to the extent
itemized in the Supplemental Schedule (which itemization identifies
each clause of Section 3.02 referring to the Supplemental Schedule
with which the Borrower is not in compliance), each of the Operator
Loans and each of the Operator Leases identified on the Initial
Borrowing Base Report is, as of the Closing Date, an Eligible
Operator Lease or an Eligible Operator Loan, as the case may be.
Each of the Operator Leases which is a Borrowing Base Asset
identified on any Borrowing Base Report (other than the Initial
Borrowing Base Report) is an Eligible Operator Lease. Each of the
Operator Loans which is a Borrowing Base Asset identified on any
Borrowing Base Report (other than the Initial Borrowing Base
Report) is an Eligible Operator Loan. As to each Borrowing Base
Asset, the Borrower has no conscious awareness, after reasonable
inquiry, of any failure of the Borrower or any Operator to comply
with any Environmental Law or Environmental Permit, or the
existence of any Environmental Claim or other environmental
condition which has resulted or would, more likely than not, result
in a Material Impairment of such Borrowing Base Asset.
SECTION 4.24 Name Changes. The Borrower has not, within
the six (6) year period immediately preceding the Closing Date,
changed its name, been the surviving entity of a merger or
consolidation, or acquired all or substantially all of the assets
of any entity.
SECTION 4.25 Borrowing Base Assets. The Borrowing Base
Assets and the other Collateral securing the Obligations (other
than the Cross-Collateralized Loans) are substantially similar to
the collateral securing the Senior Notes and any Additional
Indebtedness, if secured. The quality of, and the perfection of
the security interest of the Collateral securing the Obligations
shall be of no lower quality than the collateral securing the
Senior Notes or the Additional Indebtedness, if secured.
SECTION 4.26 Other Representations. Each of the
representations and warranties made or to be made by the Borrower
or any Subsidiary in the Collateral Documents or any other Related
Writing or any Guaranty Agreement are incorporated herein by
reference on the Closing Date and on each other date on which the
representations set forth in this Article IV are required to be
made, as if set forth herein in their entirety and shall be true
and correct as of each such date.
ARTICLE V
COVENANTS OF THE BORROWER
So long as any of the Obligations shall remain unpaid, or
any Bank shall have any Revolving Credit Commitment hereunder or
any Loan shall remain outstanding, the Borrower will comply with
the following provisions unless the Majority Banks shall otherwise
consent in writing:
SECTION 5.01 Financial Information.
(a) Quarterly Financial Statements. The Borrower will furnish
to each Bank as soon as available (and in any event within forty-
five (45) days after the end of each of the first three Fiscal
Quarters of each of the Borrower's Fiscal Years), balance sheets of
the Borrower and its Subsidiaries as at the end of that Fiscal
Quarter and their statements of income, statements of shareholder's
equity and statements of cash flow for the year to the end of that
period, all prepared (but unaudited) on a consolidated and
consolidating basis, on a comparative basis with the prior year and
in accordance with generally accepted accounting principles except
as disclosed therein,
(b) Annual Consolidated Financial Statements. The Borrower
will furnish to each Bank as soon as available (and in any event
within ninety (90) days after the end of each of the Borrower's
Fiscal Years), a complete copy of the consolidated annual audit
report of the Borrower and its Subsidiaries (including, without
limitation, all consolidated financial statements of the Borrower
and its Subsidiaries therein and notes thereto) for that Fiscal
Year which shall be:
(i) prepared on a consolidated basis, on a comparative
basis with the prior year and in accordance with generally accepted
accounting principles except as disclosed therein,
(ii) audited and certified (without qualification as to
generally accepted accounting principles), by Ernst & Young or by
other independent public accountants selected by the Borrower and
meeting the reasonable satisfaction of the Majority Banks and
(iii) accompanied by the accountants' management report,
if applicable, relating thereto,
(c) Annual Consolidating Financial Statements. The Borrower
will furnish to each Bank as soon as available (and in any event
within ninety (90) days after the end of each of the Borrower's
Fiscal Years) a complete copy of the unaudited consolidating
financial statements of the Borrower and its Subsidiaries
(including any notes thereto) for that Fiscal Year.
(d) Borrower's Certificates and Reports. The Borrower will
furnish to each Bank:
(i) concurrently with the financial statements delivered
in connection with clause (a), (b) and (c) above, a certificate of
the Borrower by the chief financial officer of the Borrower,
certifying that: (A) those financial statements fairly present in
all material respects the financial condition and results of
operations of the Borrower and its Subsidiaries subject (in the
case of interim financial statements) to routine year-end audit
adjustments and (B) no Default then exists or, if any does, a brief
description thereof and of the Borrower's intentions in respect
thereof,
(ii) within forty-five (45) days after the end of any
Fiscal Quarter and with the financial statements delivered in
connection with clause (b) above, a certificate of the Borrower by
the chief financial officer of the Borrower, in the form of Exhibit
M-1 hereto, setting forth: (A) the calculations necessary to
determine whether or not the Borrower and its Subsidiaries are in
compliance with the concentration limitations set forth in Sections
5.04(p), (q) and (r) and the general financial standards set forth
in Section 5.05 and (B) certifying that no Default then exists or
if any does, a brief description thereof and of the Borrower's
intention in respect thereof,
(iii) within forty-five (45) days after the end of any
Fiscal Quarter, a Borrowing Base Report in the form of Exhibit M-2
hereto, (A) setting forth the Borrower's Borrowing Base Assets as
at the end of that Fiscal Quarter, (B) specifying the date such
asset became a Borrowing Base Asset, (C) specifying the Appraised
Value, Carrying Value, Lease Value or such lesser value
attributable to any Borrowing Base Asset and Operator's name with
respect to each Borrowing Base Asset, (D) setting forth the results
with respect to such Operator which are necessary to calculate the
Borrower's compliance with Section 5.05(e) and (E) stating that
each of the certifications with respect to the Borrowing Base
Assets made on the Closing Date or on the date such asset became a
Borrowing Base Asset remain true and correct in all material
respects each as certified by the chief financial officer of the
Borrower as being true and complete to the best of such officer's
knowledge and belief,
(iv) within fifteen (15) days after the Agent has
notified the Borrower that the amount of the then outstanding
Revolving Credit Loans exceeds the amount of the Borrowing Base or
the Borrower becomes aware of an event which, in its good faith
judgment, would reduce the Asset Value of any Eligible Operator
Lease or Eligible Operator Loan by more than ten percent (10%), a
Borrowing Base Report certified by the chief financial officer of
the Borrower to be true and complete to the best of such officer's
knowledge and belief,
(v) within thirty (30) days after the end of any Fiscal
Quarter, a schedule in the form of Exhibit M-3 reflecting the aging
of delinquent lease and mortgage Receivables for all of Borrower's
Operator Leases and Operator Loans and in each case where a
Receivable is past due over sixty (60) days, a report on the status
of such Receivable,
(vi) within forty-five (45) days after the end of any
Fiscal Quarter, a schedule in the form of Exhibit M-4 reflecting
the Borrower's recorded liabilities, unfunded commitments,
Consolidated Contingent Liabilities and other material items and
(vii) promptly after the Borrower's receipt thereof, a
copy of any special audits of the Borrower's properties, assets or
operations conducted by the Borrower's auditors and a copy of any
letters to the Borrower from the Borrower's auditors in connection
with the preparation of the Borrower's annual audited report.
(e) Publicly Filed Information. The Borrower will furnish to
each Bank promptly when filed (in final form) or sent, a copy of:
(i) each registration statement, Form 10-K annual report,
Form 10-Q quarterly report, Form 8-K current report or similar
document filed by the Borrower with the Securities and Exchange
Commission (or any similar federal agency having regulatory
jurisdiction over the Borrower's securities) and
(ii) each proxy statement, annual report, certificate,
notice or other document sent by the Borrower to the holders of any
of its securities (or any trustee under any indenture which secures
any of its securities or pursuant to which such securities are
issued),
(f) Other Information. The Borrower will furnish to each
Bank, promptly upon any Bank's written request, such other
information about the financial condition, properties and
operations of the Borrower or any of its Subsidiaries and their
Employee Benefit Plans as that Bank may from time to time
reasonably request.
SECTION 5.02 Notices.
(a) Notice of Default; Misrepresentation. The Borrower shall
give each Bank (i) prompt written notice as soon as possible, and
in any event within five (5) Business Days, after an executive
officer of the Borrower or of any Subsidiary (A) knows of the
occurrence of any Default or Event of Default or of any development
which in such executive officer's reasonable belief would
materially and adversely affect the properties, business prospects,
profits or financial or other condition of the Borrower or any of
its Subsidiaries or (B) reasonably believes that any representation
or warranty made in this Agreement or any Related Writing shall for
any reasons have ceased in any material respect to be true and
complete and (ii) a statement on behalf of the Borrower executed by
the chief financial officer of the Borrower or such Subsidiary
setting forth the details of such Default or Event of Default or
such development and the action that the Borrower has taken or
proposes to take with respect thereto.
(b) Notice of Default under ERISA. If Borrower shall receive
notice from any ERISA Regulator or otherwise have actual knowledge
that a Default under ERISA exists with respect to any Employee
Benefit Plan, Borrower shall notify each Bank of the occurrence of
such Default under ERISA, within five (5) days after receiving such
notice or obtaining such knowledge and shall: (i) so long as the
Default under ERISA has not been corrected to the satisfaction of,
or waived in writing by the party giving notice, the Borrower shall
thereafter treat as a current liability (if not otherwise so
treated) all liability of Borrower or its Subsidiary that would
arise by reason of the termination of or withdrawal from such
Employee Benefit Plan if such plan was then terminated, and (ii)
within fifteen (15) days of the receipt of such notice or obtaining
such knowledge, furnish to each Bank a current consolidated balance
sheet of Borrower with the amount of the current liability referred
to above certified by the independent public accountant set forth
in Section 5.01(b)(ii).
(c) Notice of Litigation. The Borrower shall give each Bank
prompt, and in any event within five (5) Business Days of the date
the Borrower or any of its Subsidiaries becomes aware or should
become aware of, notice of (i) any suit at law or in equity filed
or threatened to be filed against the Borrower or any of its
Subsidiaries involving money or property valued in excess of Five
Million Dollars ($5,000,000), except where the same is fully
covered by insurance and the insurer has accepted liability
therefor, and (ii) any litigation, investigation or proceeding
before or by any administrative or governmental agency, department,
bureau, commission or board the effect of which would be to limit,
prohibit or restrict materially the manner in which the Borrower or
any of its Subsidiaries presently conducts its business.
(d) Taxes. The Borrower shall give each Bank prompt, and in
any event within ten (10) days, notice of the receipt by the
Borrower or any of its Subsidiaries from the Internal Revenue
Service or any other federal, state, local, domestic or foreign
taxing authority any allegation of any default by the Borrower or
any of its Subsidiaries in the payment of any tax material in
amount or notice of any assessment with respect thereto.
(e) Environmental Reporting. The Borrower shall give each
Bank prompt, and in any event within ten (10) days of the date the
Borrower or any of its Subsidiaries receives or transmits, as the
case may be, copies of all material communications with any
government or governmental agency relating to Environmental Laws
and all material communications with any other Person relating to
Environmental Claims.
(f) Notice of New Subsidiary. The Borrower shall give the
Agent and each Bank prompt, and in any event thirty (30) days prior
to the creation of any Subsidiary, notice of the Borrower's intent
to create such Subsidiary, together with a summary of the name,
location of such Subsidiary and the initial assets to be owned by
such Subsidiary.
SECTION 5.03 Affirmative Covenants.
(a) Taxes. The Borrower shall pay, and cause each of its
Subsidiaries to pay, in full: (i) prior in each case to the date
when penalties for the nonpayment thereof would attach, all taxes,
assessments and governmental charges and levies for which it may be
or become subject and (ii) prior in each case to the date the claim
would become delinquent for non-payment, all other lawful claims
(whatever their kind or nature) which, if unpaid, might become a
Lien on the property of the Borrower; provided, however, that no
item (other than wage or social security withholding tax
obligations) need be paid so long as and to the extent that it is
contested in good faith and by timely and appropriate proceedings
which are effective to stay enforcement thereof.
(b) Financial Records. The Borrower shall maintain, and cause
each of its Subsidiaries to maintain, at all times, true and
complete financial records in accordance with generally accepted
accounting principles, consistently applied, and, without limiting
the generality of the foregoing, make appropriate accruals to
reserves for estimated and contingent losses and liabilities.
(c) Visitation. The Borrower shall permit, and cause each of
its Subsidiaries and Operators to permit, upon receipt of not less
than two (2) Business Days' prior written notice, each of the Banks
during normal business hours: (i) to examine the Borrower's, such
Subsidiary's or such Operator's, properties, as the case may be,
with the guidance and supervision of the Borrower or such
Subsidiary, and to examine the Borrower's or such Subsidiary's
financial records and to make copies of and extracts from such
records; and (ii) to consult with the Borrower's or such
Subsidiary's officers, directors, accountants, actuaries, trustees
and plan administrators, as the case may be, in respect of the
Borrower's or such Subsidiary's respective financial condition,
properties and operations and the financial condition of the
Borrower's or such Subsidiary's respective Employee Benefit Plans,
each of which parties is hereby authorized to make such information
available to each of the Banks to the same extent that it would to
the Borrower or such Subsidiary, as the case may be; provided,
however, that, all information obtained shall be subject to the
provisions of Section 8.03.
(d) Insurance. The Borrower shall cause each of its Operators
to (i) keep itself and all of its and their respective insurable
properties insured at all times to such extent, with such
deductibles, by fiscally sound and reputable insurers accorded a
rating of "A VIII" or better by A.M. Best Company, Inc. (or a
comparable rating by any comparable rating agency) against such
hazards and liabilities as is generally and prudently done by other
business enterprises (including, without limitation, with respect
to any Health Care Facility located, in whole or in part, in a
designated 100-year flood plain area, flood insurance as required
by the Flood Disaster Act for the improvements in such amounts as
may be customary for comparable properties in the area)
respectively similar to the Borrower or such Subsidiary and as
required pursuant to any Borrower Mortgage, (ii) forthwith upon the
written request of any of the Banks, cause an appropriate officer
to deliver to each of the Banks a certificate setting forth, in
form and detail satisfactory to each of the Banks, such information
about that insurance, all as any of the Banks may from time to time
reasonably request, (iii) furnish certificates of insurance to the
Agent containing a provision for thirty (30) days notice to the
Agent for the benefit of the Banks prior to any cancellation
thereof, and (iv) with respect to Borrowing Base Assets, furnish
insurance policies insuring such assets reflecting an endorsement
requiring thirty (30) days notice to the Agent prior to the
modification or cancellation of such policy and reflecting the name
of the Agent for the benefit of the Banks as an additional insured
and/or a "mortgagee loss payee" as its interests may appear.
(e) Corporate Existence; REIT Qualification. The Borrower
shall at all times maintain, and cause each of its Subsidiaries to
maintain, its respective corporate existence, rights and
franchises, the failure to maintain any of which would have a
Material Adverse Effect; provided, however, that this Section
5.03(e) shall not prevent any action permitted by Section 5.04(a).
The Borrower shall at all times maintain its status as a REIT
qualified under Section 856 of the Internal Revenue Code.
(f) Compliance with Environmental Laws. The Borrower will and
will cause each of its Subsidiaries and Operators to use and
operate all of its respective facilities and properties in material
compliance with all Environmental Laws except where non-compliance,
taken singly or with all other instances of noncompliance, has
neither resulted nor would, more likely than not, result in a
Material Adverse Effect. The Borrower will and will cause each of
its Subsidiaries and Operators to keep all necessary Environmental
Permits in effect and remain in material compliance therewith, and
handle all Hazardous Materials in compliance with all applicable
Environmental Laws except where non-compliance, when taken singly
or with all other instances of noncompliance, has neither resulted
nor would, more likely than not, result in a Material Adverse
Effect. The Borrower shall not, and shall not permit any of its
Subsidiaries or Operators, to suffer to exist an environmental
condition which, when taken singly or with all other such
conditions, has resulted or would, more likely than not, result in
a Material Adverse Effect. The Borrower shall promptly resolve any
non-compliance with Environmental Laws and keep its property free
of any Lien imposed by any Environmental Law which individually or
in the aggregate has resulted or would, more likely than not,
result in a Material Adverse Effect.
(g) Compliance With Laws. The Borrower shall comply, and
shall cause each of its Subsidiaries to comply, in all respects
with its Certificate of Incorporation or Articles of Incorporation,
as the case may be, and its By-laws or Regulations, as the case may
be, and all applicable Laws if non-compliance, when taken singly or
with all other instances of non-compliance, with such Law or order
has neither resulted nor would, more likely than not, result in a
Material Adverse Effect.
(h) Remedial Action. The Borrower shall conduct, or cause its
Subsidiaries and Operators under Operator Leases to conduct, such
investigation, study, sampling and testing, and undertake, or cause
its Subsidiaries and such Operators to undertake, such cleanup,
removal, remedial or other action as may be necessary to comply
with all applicable Environmental Laws and any final orders or
directives of all governmental authorities;provided however, that,
this section shall not apply to any noncompliance with any such
orders or directives if and to the extent that the same shall be
contested in good faith by timely and appropriate proceedings which
are effective to stay enforcement thereof and against which
appropriate reserves have been established.
(i) Properties. The Borrower shall maintain, and shall
cause each Subsidiary and each Operator under a Operator Lease to
maintain, all assets necessary to its continuing operations in good
working order and condition, ordinary wear and tear excepted,
refrain from wasting or destroying any such necessary assets or any
part thereof, and refrain from being negligent in the care or use
thereof.
(j) Compliance with Terms of All Material Contracts. The
Borrower shall perform and observe, and cause each of its
Subsidiaries to perform and observe, all the material terms and
provisions of each material contract to be performed or observed by
it, including, without limitation, the Management Agreement, the
Senior Note Documents, all Eligible Operator Loan Documents,
Eligible Operator Lease Documents and maintain each such material
contracts in full force and effect, and enforce, to the extent that
the Borrower, in its reasonable judgment, determines to be
appropriate, each such material contract in accordance with its
terms if the failure of the Borrower to perform, observe or enforce
any one or more of such contracts has neither resulted nor would,
more likely than not, result in a Material Adverse Effect. The
Borrower shall not permit any Operator under any Eligible Operator
Loan or Eligible Operator Lease to remain in material default
thereof if such default has resulted or would, more likely than
not, result in a Material Adverse Effect.
(k) Qualification to do Business. The Borrower shall remain,
and shall cause each of its Subsidiaries to remain, qualified to do
business in each jurisdiction in which such qualification is
required by law and in which the consequences of a failure to
qualify has resulted or would, more likely than not, result in a
Material Adverse Effect.
(l) Liens and Encumbrances. The Borrower shall keep, and
shall cause each of its Subsidiaries to keep, the Collateral and
its respective assets and property, as the same is constituted from
time to time, free and clear of all Liens, except those held by
Agent for the benefit of the Banks and those liens as specifically
permitted under Section 5.04(e) hereof.
(m) Mandatory Reappraisal. Upon the request of the Agent or
any Bank, the Borrower shall obtain within thirty (30) Business
Days of such request, at Borrower's sole expense, a new appraisal
by a certified M.A.I. appraiser for any Borrowing Base Asset with
respect to which the date of such appraisal is more than three (3)
calendar years old, which appraisal shall be prepared in accordance
with the minimum standards required of national banks as the Agent
deems appropriate and shall state the income, market and cost
approach value and the Appraised Value of such property.
(n) Requested Reappraisal. The Borrower shall, upon the
request of the Majority Banks, obtain a new appraisal by a
certified M.A.I. appraiser for any Borrowing Base Asset specified
by such Banks, which appraisal shall be prepared in accordance with
the minimum standards required of national banks as the Agent deems
appropriate, and shall state the income, market and cost approach
value of such property. Notwithstanding anything set forth in
Section 9.09, fifty percent (50%) of the cost of any appraisal
requested under this Section 5.03(n) shall be borne by the Borrower
and fifty percent (50%) shall be borne by the Banks proportion to
such Bank's Ratable Portion.
SECTION 5.04 Negative Covenants.
(a) Equity Transactions. The Borrower shall not, and shall
not permit any of its Subsidiaries to, (i) be a party to any merger
or consolidation, (ii) purchase all or substantially all of the
assets and business of another Person, (iii) make or keep any
investment in any stocks or other equity securities of any kind,
(iv) lease as lessor, sell, sell-leaseback or otherwise transfer
(whether in one transaction or a series of transactions) all or any
substantial part of its fixed assets, including, without
limitation, all or substantially all of the assets of a division,
branch or other unit operation, (v) lease as lessor, sell or
otherwise transfer any Collateral, (vi) make or keep any investment
in any Subsidiary, or (vii) sell or otherwise transfer (or, in the
case of a Subsidiary of the Borrower, issue) any shares of stock or
other equity securities of any Subsidiary to anyone other than the
Borrower; provided, however, that, if no Default or Event of
Default shall then exist and none would thereupon begin to exist,
this Section shall not apply to
(A) any acquisition by the Borrower or any Wholly-Owned
Subsidiary of the Borrower of all or substantially all of the
assets or stock of another Person or the merger or consolidation of
another Person with or into the Borrower or such Wholly-Owned
Subsidiary where the Borrower or such Wholly-Owned Subsidiary is
the surviving corporation, so long as:
(I) the Person acquired by or merged into or consolidated with
the Borrower or such Wholly-Owned Subsidiary is in the same line of
business as the Borrower; and
(II) immediately after giving effect to such transaction the
management of the Borrower or such Wholly-Owned Subsidiary shall
not have materially changed; and
(III) immediately after giving effect to such transaction the
Consolidated Net Worth of the Borrower shall be no less than the
Consolidated Net Worth of the Borrower immediately prior to giving
effect to such transaction; and
(IV) immediately after giving effect to such transaction (and
after giving pro forma effect to such transaction for the purposes
of determining compliance with Section 5.05 of this Agreement) no
Default or Event of Default would exist; and
(V) on the date that the consummation of such transaction is
to become effective, the assets reflected on the balance sheet of
such Person so acquired, merged or consolidated shall not exceed
the lesser of (x) Fifty Million Dollars ($50,000,000) or (y)
twenty-five percent (25%) of the Borrower's Consolidated Tangible
Net Worth as at the end of the immediately preceding Fiscal
Quarter;
(B) any sale, lease or transfer of Collateral by the Borrower
otherwise prohibited by this Section 5.04(a) so long as such sale,
lease or transfer is a sale of Borrower Fee Property in the
ordinary course of the Borrower's business or any other sale, lease
or transfer made in accordance with the terms and conditions of
Borrower's Operator Leases and Operator Loans which permit an
Operator to purchase Borrower Fee Property or prepay and Operator
Loan, as the case may be.
(C) any transaction entered into for the purpose of causing
the Borrower to be internally self-administered to the extent that:
(I) such transaction consists of: (1) a merger or
consolidation of the Manager and the Borrower in which the Borrower
is the surviving corporation, (2) the creation of a Wholly-Owned
Subsidiary for the purpose of acquiring the assets of the Manager
or merging or consolidating with the Manager, (3) the acquisition
of all or substantially all of the assets of the Manager by the
Borrower or such Wholly-Owned Subsidiary, (4) the merger or
consolidation of the Manager with such Wholly-Owned Subsidiary, (5)
any merger or consolidation of such Wholly-Owned Subsidiary with
the Borrower in which the Borrower is the surviving corporation, or
(6) any other transaction entered into for purposes consistent with
causing the Borrower to be internally self-administered and
consented to by the Majority Banks which consent shall not be
unreasonably withheld (any Bank shall be deemed to be reasonable in
the withholding of consent to the extent the Bank believes, in its
sole discretion based on internal credit and underwriting policies,
that the proposed transaction may be adverse or potentially adverse
to such Bank or the Banks or the repayment of the Obligations); and
(II) immediately after giving effect to such transaction (and
after giving pro forma effect to such transaction for the purposes
of determining compliance with Section 5.05 of this Agreement) no
Default or Event of Default would exist; and
(III) the Rating Agencies which immediately prior to such
transaction have rated the unsubordinated, unsecured debt of the
Borrower shall have confirmed that after giving effect to such
transaction such debt of the Borrower shall not be rated lower than
the rating for such debt prior to the consummation of such
transaction; and
(IV) after giving effect to such transaction, the Borrower
will continue to qualify as a REIT under the Internal Revenue Code;
and
(V) the Borrower has delivered to the Agent a certificate
executed by two executive officers of the Borrower certifying that
the conditions specified in clauses (I) through (IV) of this
Section 5.04(a)(C) have been satisfied,
(D) any investment by the Borrower or any Wholly-Owned
Subsidiary in any stocks or any other equity securities of any kind
which constitute a Permitted Investment; provided, however, that
(I) such investment shall be subject to the limitations set forth
in Section 5.04(p)(iv) or 5.04(p)(v) and (II) to the extent such
investment consists of investments specified in clause (E) below,
such investment is subject to the limitations set forth in clause
(E),
(E) any investment by the Borrower in the capital stock
(whether by the transfer of cash or any other asset of the
Borrower) of any Subsidiary of the Borrower that is a Wholly-Owned
Subsidiary, to the extent that any such investment when taken
together with all other investments in Wholly-Owned Subsidiaries
and all loans to or Guaranties by the Borrower of the obligations
of Wholly-Owned Subsidiaries shall not exceed at any time an amount
equal to the greater of Twenty Million Dollars ($20,000,000) or
twenty-five percent (25%) of the Borrower's Balance Sheet Assets at
such time.
(b) Restricted Payments. Neither the Borrower nor any
Subsidiary of the Borrower will declare, pay or make any Restricted
Payments: provided, however, that, so long as the Borrower remains
a qualified REIT:
(i) any Subsidiary of the Borrower may make a Restricted
Payment to the Borrower;
(ii) this Section 5.04(b) shall not apply to any
Restricted Payment made in connection with and pursuant to that
certain Rights Agreement, dated as of July 19, 1994 between the
Borrower and Chemical Bank, as Rights Agent (a copy of which has
been delivered to the Agent);
(iii) the Borrower or any Subsidiary may declare and make
Restricted Payments (including Restricted Payments made in
connection with a Special Transaction) if but only to the extent
that:
(A) no Default or Event of Default shall have occurred and be
continuing at the time of declaration or payment of any such
Restricted Payment or immediately after giving effect thereto and
(B) immediately after giving effect to the making of such
Restricted Payment, the sum of all Restricted Payments made
subsequent to December 31, 1993 would not exceed the sum of (1)
$10,000,000, (2) 100% of Cash Flow accumulated subsequent to
December 31, 1993, and (3) the net proceeds to the Borrower since
December 31, 1993 from the issuance of any shares of its capital
stock or any warrants, options or other rights with respect thereto
less the proceeds required to be paid to the Banks in reduction of
outstanding Obligations in accordance with Section 2.04(c)(iv) and
Section 5.05(a)hereof;
provided however, that the Borrower may make a Restricted
Payment (excluding a Restricted Payment in connection with a
Special Transaction) if a Default (but not an Event of Default)
shall have occurred and be continuing if such Restricted Payment
was declared prior to the occurrence of such Default and the making
of such Restricted Payment would be otherwise permitted under
clause (B) of this Section 5.04(b).
(iv) the Borrower may declare and make Restricted Payments
(excluding Restricted Payments made in connection with a Special
Transaction) despite the occurrence and continuance of a Default or
Event of Default at the time that any such Restricted Payment was
declared or made, if but only to the extent that:
(A) the declaration and payment of such Restricted Payment is
required in order for the Borrower to continue to qualify as a REIT
under the Code; and
(B) the Default or Event of Default existing at the time of
such declaration did not result from (1) a breach of this Section
5.04(b), (2) a failure to make any payment or prepayment of
principal or interest on the Obligations when due pursuant to
Section 2.04 or Section 2.06, or (3) the occurrence of any event
specified in Section 6.01(a) or 6.01(h) through 6.01(k).
(c) Credit Extensions; Investments in Notes, Etc. The
Borrower shall not and shall not permit any of its Subsidiaries to
(i) make or keep any investment in any notes, bonds or other
obligations of any kind for the payment of money or make or have
outstanding at any time any advance or loan to any Person or (ii)
be or become a Guarantor of any kind; provided, however, that this
subsection shall not apply to:
(A) any existing or future investment by the Borrower or any
Wholly-Owned Subsidiary in any such notes, bonds or other
obligations consisting of Acceptable Marketable Securities
constituting Permitted Investments,
(B) any Guaranty Agreement,
(C) any such investment in any notes, bonds or other
obligations, any such loan or advance or any such Guaranty by the
Borrower or any Wholly-Owned Subsidiary to the extent constituting
a Permitted Investment; provided, however, that (I) such investment
shall be subject to the limitations set forth in Sections 5.04(a),
5.04(p), 5.04(q) or 5.04(r), ((II) such investment is permitted to
be made so long as no Default or Event of Default has occurred or
would occur upon the making thereof, (III) to the extent such
investment consists of an Operator Lease or an Operator Loan, such
investment is a Qualified Investment, (IV) to the extent consisting
of advances, loans or Guarantees specified in clause (E) below,
such investment is subject to the limitations set forth in clause
(E) and (V) to the extent such investment consists of loans or
Guarantees specified in clause (F) below, such investment is
subject to the limitations set forth in clause (F),
(D) any existing investment, advance, loan or Guaranty by the
Borrower or any Wholly-Owned Subsidiary (other than investments,
advance or loans provided for under subsections (E) or (F) below)
fully disclosed in the Borrower's December 31, 1993 audited
financial statements or in the Supplemental Schedule,
(E) any existing or future advances, loans or Guarantees by
the Borrower of the Indebtedness of West Part Place, Limited
Partnership, Independence Village Associates, Ltd., Landver
Properties, Ltd, Independence Village of Rockford Limited
Partnership or Ponce de Leon Limited Partnership, so long as the
aggregate amount of all such advances, loans or Guarantees does not
at any time exceed Forty Million Dollars ($40,000,000) and which
otherwise constitute a Permitted Investment,
(F) any loan to or Guaranty by the Borrower of any obligations
of any Subsidiary of the Borrower which is a Wholly-Owned
Subsidiary, to the extent that the amount of any such loan or
Guaranty when taken together with all other loans to and Guaranties
of the obligations of Wholly-Owned Subsidiaries and all investments
in the capital stock of Wholly-Owned Subsidiaries shall not exceed
at any time an amount equal to the greater of Twenty Million
Dollars ($20,000,000) or twenty-five percent (25%) of the
Borrower's Balance Sheet Assets at such time,
(G) any endorsement of a check or other medium of payment for
deposit or collection, or any similar transaction in the normal
course of business, or
(H) trade accounts arising and outstanding in the ordinary
course of business.
(d) Indebtedness. The Borrower shall not, and shall not
permit any of its Subsidiaries to, create, assume, incur, suffer to
exist or have outstanding at any time any Indebtedness or other
debt of any kind; provided, however, that this Section shall not
apply to (i) the Obligations, (ii) the Indebtedness evidenced by
the Senior Notes, (iii) ordinary course trade payables, (iv) any
existing or future Indebtedness of the Borrower or any Wholly-Owned
Subsidiary (not otherwise permitted by clause (vi) below) secured
by a Purchase Money Security Interest permitted by Section 5.04(e),
(v) unsecured Indebtedness of the Borrower, (vi) any future
Indebtedness incurred by the Borrower by reason of the public
offering or private placement of debt instruments or securities
having terms reasonably consistent with the Senior Note Documents
(the "Additional Indebtedness") and which are secured by a Lien
permitted by Section 5.04(e) below, (vii) any existing Indebtedness
that is fully disclosed in the Borrower's December 31, 1993 audited
financial statements or in the Supplemental Schedule, or any
renewal or extension thereof in whole or in part, (viii) any
deferred payment obligations incurred or undertaken in connection
with a Special Transaction which shall be subject to the
restrictions set forth in Section 5.04(a)(C) and 5.04(b) of this
Agreement at the time such obligations are paid (and not at the
time such obligations are incurred or undertaken) or (ix) so long
as no Default or Event of Default shall then exist or would
thereupon occur, any Indebtedness of the Borrower or any Wholly-
Owned Subsidiary for the acquisition or financing of Health Care
Facilities which are Qualified Investments.
(e) Liens; Leases. The Borrower shall not and shall not
permit any of its Subsidiaries to (i) lease any property as lessee
or acquire or hold any property subject to any land contract,
inventory consignment or other title retention contract, (ii) sell
or otherwise transfer any receivables with recourse, or (iii)
suffer or permit any property now owned or hereafter acquired by it
to be or become encumbered by any mortgage, security interest, Lien
or financing statement; provided, however, that, with respect to
the Borrower and any Wholly-Owned Subsidiary, this subsection shall
not apply to:
(A) any unperfected, inchoate tax lien, or any lien securing
workers' compensation or unemployment insurance obligations, or any
mechanic's, materialmen's, laborer's, carrier's or landlord's lien,
or any unperfected, inchoate lien arising under ERISA, or any
security interest arising under article four (bank deposits and
collections) or five (letters of credit) of the Uniform Commercial
Code, or any similar security interest or other Lien, provided that
this clause (A) shall apply only to security interests and other
Liens arising by operation of Law (whether statutory, civil or
common Law) and in the ordinary course of business and shall not
apply to any security interest or other Lien that secures any
Indebtedness, any Guaranty of any Indebtedness or any obligation
that is in material default in any manner (other than any default
contested in good faith by timely and appropriate proceedings
effective to stay enforcement of the security interest or other
lien in question),
(B) zoning or deed restrictions, public utility easements,
minor title irregularities and similar matters having no adverse
effect as a practical matter on the ownership or use of any of the
property in question, including, without limitation (I) any Lien
reflected on any title policy delivered pursuant to Section 3.03 in
respect of any Borrower Fee Property in respect of an Eligible
Operator Lease, so long as such Lien is not prior to the Lien of
the Agent created by the Borrower Mortgage with respect thereto
(other than Liens for taxes assessed but not yet due and payable)
and could not result in a Material Impairment or (II) any Lien
reflected on any Assigned Title Policy delivered pursuant to
Section 3.03 so long as such Lien could not result in a Material
Impairment,
(C) other than any Lien on any Collateral, any lien securing
or given in lieu of surety, stay, appeal or performance bonds, or
securing performance of contracts or bids (other than contracts for
the payment of money borrowed), or deposits required by Law or as
a condition to the transaction of business or the exercise of any
right, privilege or license,
(D) other than any Lien on any Collateral, any mortgage,
security interest, capitalized lease (it being agreed that a
capitalized lease is a lien rather than a lease for the purposes of
this Agreement) or other lien (each, a "Purchase Money Security
Interest") which is created or assumed in purchasing, constructing
or improving any property or to which any property is subject when
purchased; provided, however, that (x) the Purchase Money Security
Interest shall be confined to the aforesaid property and (y) the
Indebtedness secured thereby does not exceed the total cost of the
purchase, construction or improvement,
(E) other than any Lien on any Collateral, any mortgage,
security interest or other lien which (together with the
Indebtedness secured thereby) is fully disclosed in the Borrower's
December 31, 1993, audited financial statements or in the
Supplemental Schedule,
(F) any lease not prohibited by Section 5.04(a),
(G) other than any Lien on any Collateral, any mortgage,
security interest or other Lien securing the Senior Notes or the
Additional Indebtedness, or
(H) any financing statement perfecting a security interest
that would be permissible under this subsection.
(f) Name Change; Fictitious Name. The Borrower shall not, and
shall not permit any Subsidiary to, change its name, use or permit
any Subsidiary to use, any other corporate or fictitious name,
except for the names disclosed on the Supplemental Schedule, unless
the Borrower gives the Agent written notice thereof at least thirty
(30) days prior thereto.
(g) Charter Amendments. The Borrower shall not amend, or
permit any of its Subsidiaries to amend, its certificate or
articles of incorporation or bylaws or regulation or other similar
organizational document; provided, however, that, this provision
shall not prohibit any amendment as to which the Borrower has
delivered to the Agent a written notice describing such amendment
at least thirty (30) day prior to the effectiveness thereof and (i)
is an amendment required by applicable law or in connection with a
transaction permitted by Section 5.04(a) or (ii) is an amendment
which increases the authorized shares of the stock of the Borrower
or (iii) is an amendment which does not adversely affect the
enforceability by the Agent and the Banks of the Borrower's
obligations under this Agreement or any Collateral Document or any
Subsidiary's obligations under any Guaranty Agreement.
(h) Accounting Changes. The Borrower shall not make or
permit, or permit any of its Subsidiaries to make or permit, any
change in accounting policies or reporting practices, except as
required by law or as required or permitted by generally accepted
accounting principles applicable to the Borrower or such
Subsidiary, as the case may be, from time to time.
(i) Amendment; Default of Material Contracts. The
Borrower shall not, and shall not permit any of its Subsidiaries to
take any action to amend, cancel, terminate, waive any provision
of, consent to the noncompliance with any term of any material
contract (material contracts being deemed to include, without
limitation, the Management Agreement, each Eligible Operator Loan
Document, each Eligible Operator Lease Document but to exclude the
Senior Notes and Senior Note Documents and any other documents
executed in connection with any Additional Indebtedness); provided,
however, that the Borrower may take any such action so long as such
action (i) does not relate to a material financial provision of any
agreement which is the subject of a Collateral Assignment, (ii)
does not relate to any provision in any agreement which is the
subject of a Collateral Assignment and which provision is expressly
for the benefit of the mortgagee or assignee with respect thereto,
(iii) is taken in the ordinary course of the Borrower's or such
Subsidiary's business, (iv) is consistent with the Borrower's past
practices, (v) which would not, more likely than not, result in a
Material Adverse Effect, (vi) will not have an adverse effect on
the interest (including the perfection and priority of any security
interest or Lien in favor of the Borrower or the Agent for the
benefit of the Banks) of the Banks in such agreement or the assets
with respect thereto or otherwise result in a Material Impairment,
and (vii) with respect to the Management Agreement, does not
materially increase any fee or release any party thereto of any
material obligation thereunder other than any release in connection
with the Special Transaction.
(j) Senior Note Documents. The Borrower shall not, and shall
not permit any of its Subsidiaries to take any action to amend,
cancel, terminate, waive any provision of, consent to the
noncompliance with any term of the Senior Notes or the Senior Note
Documents or any documents executed or delivered in connection with
any Additional Indebtedness.
(k) Use of Proceeds. The Borrower shall not use the proceeds
of any Loan for any purpose other than those set forth in Section
2.01(b).
(l) Adverse Obligations. The Borrower shall not be subject
to, and shall not permit any of its Subsidiaries to be subject to,
any contract, agreement, corporate restriction, judgment, decree or
order which has resulted or would, more likely than not, result in
a Material Adverse Effect.
(m) Transactions with Affiliates. The Borrower shall not, and
shall not permit any of its Subsidiaries to, enter into or suffer
or permit any arrangement or contract with any of its Affiliates;
provided, however, that, this provision shall not apply so long as
(i) such arrangement or contract is in the ordinary course of and
pursuant to the reasonable requirements of the Borrower's or a
Wholly-Owned Subsidiary's business and (ii) the terms of such
arrangement or contract are fair and equitable to the Borrower or
such Subsidiary, as the case may be, and are no less favorable to
the Borrower or such Wholly-Owned Subsidiary than would be obtained
in an arms-length transaction with a Person which is not an
Affiliate; provided, further, that, this provision shall not apply
to any transaction with any Wholly-Owned Subsidiary, the Manager or
any Affiliate of the Manager in connection with any Special
Transaction otherwise permitted by this Agreement.
(n) Maintenance of Borrowing Base. The Borrower shall not
permit the aggregate Revolving Credit Loans at any time outstanding
to be greater than seventy-five percent (75%) of the aggregate
Asset Value of the Borrowing Base Assets. The Borrower shall not
permit or suffer any Borrowing Base Asset to fail to be at all
times a Qualified Investment.
(o) Portfolio Concentration Limitation. The Borrower shall
not permit or suffer, at the end of any three (3) consecutive
Fiscal Quarters:
(i) the sum of the outstanding principal amount, accrued
interest and fees in respect of all financing of construction loans
made by the Borrower to exceed the greater of Thirty-Five Million
Dollars ($35,000,000) or ten percent (10%) of the Borrower's
Balance Sheet Assets as at the end of each such Fiscal Quarter,
(ii) the sum of all Credit Enhancements, including
principal, accrued interest (estimated in good faith to the extent
not known) and fees, executed or entered into by the Borrower on
behalf of Operators to exceed twenty percent (20%) of the
Borrower's Consolidated Net Worth as at the end of each such Fiscal
Quarter, or
(iii) the sum of the outstanding principal amount,
accrued interest and fees in respect of all financing to
psychiatric hospitals to exceed twenty percent (20%) of the
Borrower's Balance Sheet Assets as at the end of each such Fiscal
Quarter.
(p) Other Financing Limitations. The Borrower shall not, and
shall not suffer any Subsidiary to, make or commit to make:
(i) any construction financing to any Person if, after
giving effect thereto, the aggregate amount (including principal,
accrued interest and fees) of all outstanding construction
financing on the Borrower's balance sheet would exceed the greater
of Thirty-Five Million Dollars ($35,000,000) or ten percent (10%)
of the Borrower's Balance Sheet Assets as at the end of the
immediately preceding Fiscal Quarter,
(ii) any Credit Enhancement to any Person if, after
giving effect thereto, the aggregate amount (including principal,
accrued interest (estimated in good faith to the extent not known)
and fees) of all outstanding Credit Enhancements executed or
entered into by the Borrower on behalf of Operators would exceed
twenty percent (20%) of the Consolidated Net Worth of the Borrower
as at the end of the immediately preceding Fiscal Quarter,
(iii) any financing of any psychiatric hospital if, after
giving effect thereto, the aggregate amount (including principal,
accrued interest and fees) of all outstanding financing of
psychiatric hospitals would exceed twenty percent (20%) of the
Borrower's Balance Sheet Assets as at the end of the immediately
preceding Fiscal Quarter,
(iv) any investment in any REMIC if, after giving effect
thereto, the aggregate amount of all outstanding investments in
REMICs together with all outstanding investments in Permitted
Investments (other than REMICs and other than Permitted Investments
described in Internal Revenue Code Section 856(c)(5)(A) which are
not REMICs) would exceed twenty-five percent (25%) of the
Borrower's Balance Sheet Assets as at the end of the immediately
preceding Fiscal Quarter; provided, however, that any such
investment shall be subject to the limitations set forth in
Sections 5.04(a), 5.04(c), 5.04(o) and the other clauses of this
Section 5.04(p); or
(v) any investment in any Permitted Investment (other than
REMICs) if, after giving effect thereto, the aggregate amount of
all outstanding other Permitted Investments (other than those
described in Internal Revenue Code Section 856(c)(5)(A)) would
exceed ten percent (10%) of the Borrower's Balance Sheet Assets as
at the end of the immediately preceding Fiscal Quarter; provided,
however, that any such investment shall be subject to the
limitations set forth in Sections 5.04(a), 5.04(c), 5.04(o) and the
other clauses of this Section 5.04(p).
(q) Portfolio Diversification Requirement. The Borrower shall
not permit for each of any three (3) consecutive Fiscal Quarters:
(i) more than seventeen and one-half percent (17-1/2%) of
the Borrower's Balance Sheet Assets as at the end of each of such
three (3) consecutive Fiscal Quarters to be operated directly or
indirectly by, any single Operator, lessee or borrower (including
any affiliate of any such Operator, lessee or borrower) of the
Borrower or any Subsidiary of the Borrower on a consolidated basis,
or
(ii) more than seventeen and one-half percent (17-1/2%)
of the Borrower's consolidated gross revenues, as reflected on the
Borrower's statement of income for each of such three (3)
consecutive Fiscal Quarters, to be generated directly or indirectly
from, any single Operator, lessee or borrower (including any
affiliate of any such Operator, lessee or borrower) of the Borrower
or any Subsidiary of the Borrower on a consolidated basis.
(r) Borrowing Base Concentration Limitation. The Borrower
shall not permit the aggregate Asset Value of all Borrowing Base
Assets constituting Health Care Facilities which are psychiatric
hospitals to be greater than twenty percent (20%) of the aggregate
Asset Value of all Borrowing Base Assets at such time.
SECTION 5.05 Financial Covenants.
(a) Consolidated Tangible Net Worth. The Borrower will not
suffer or permit, at any time, the Consolidated Tangible Net Worth
to be less than the "Required Minimum" in effect at such time. The
"Required Minimum" shall be One Hundred Eighty Million Dollars
($180,000,000) and, thereafter, shall be permanently increased by
an amount equal to eighty percent (80%) of the net cash proceeds of
any issuance of equity by the Borrower effective as of date upon
which the Borrower receive such proceeds.
(b) Consolidated Interest Coverage. The Borrower will not
suffer or permit the Consolidated Interest Coverage Ratio for any
Fiscal Quarter to be less than 2.0 to 1.0.
(c) Consolidated Leverage Ratio. The Borrower will not suffer
or permit, as at the end of any Fiscal Quarter, the ratio of its
Consolidated Funded Indebtedness to its Consolidated Net Worth to
exceed 1.30 to 1.0.
(d) Consolidated Contingent Leverage Ratio. The Borrower will
not suffer or permit, as at the end of any Fiscal Quarter, the
ratio of the sum of its Consolidated Funded Indebtedness plus its
Consolidated Contingent Liabilities to its Consolidated Net Worth
to exceed 1.55 to 1.0.
(e) Borrowing Base Debt Coverage Ratio. The Borrower shall
not permit, for any Fiscal Quarter, the ratio of (a) the sum of the
aggregate net income of each Operator during such Fiscal Quarter
attributable to each Borrowing Base Asset plus the aggregate amount
of amortization and depreciation expense of such Operators
attributable to each such Borrowing Base Asset plus the aggregate
federal, state and local taxes of such Operators attributable to
each such Borrowing Base Asset plus the aggregate of all fees,
interest, principal and lease payments owed by such Operators to
the Borrower for such period attributable to each such Borrowing
Base Asset to (b) the sum the aggregate of all fees, interest,
principal and lease payments owed by such Operators to the Borrower
for such period attributable to all such Borrowing Base Assets to
be less than 1.25 to 1.0; provided, however, that, in calculating
the amounts set forth in clauses (a) and (b) above attributable to
any Borrowing Base Asset, such amounts shall be adjusted (prior to
the aggregation of such amounts with the amounts of all other
Borrowing Base Assets) by multiplying such amounts by a fraction,
the numerator of which is the sum of the Asset Values attributable
to such Borrowing Base Assets and the denominator of which is the
aggregate of the Asset Values of all Borrowing Base Assets.
ARTICLE VI
EVENTS OF DEFAULT
SECTION 6.01 Events of Default. Each of the following
shall constitute an Event of Default hereunder:
(a) Payments. (i) If the principal amount of any of the
Obligations or any other Indebtedness of the Borrower and its
Subsidiaries or any thereof to the Agent and the Banks or any
thereof (except any Indebtedness or Obligations to the Agent or any
Bank payable on demand) shall not be paid in full promptly when the
same becomes payable, whether at maturity, by acceleration or
otherwise, or (ii) if any interest on any of the Obligations or any
other Indebtedness of the Borrower or its Subsidiaries to the Agent
and the Banks or any thereof shall remain unpaid for three (3)
consecutive days thereafter; or (iii) if such of the Indebtedness
or Obligations of the Borrower and its Subsidiaries or any thereof
to the Agent and the Banks or any thereof, as may be payable on
demand shall not be paid in full immediately after any actual
demand for payment.
(b) Covenants Without Grace. If the Borrower shall fail or
omit to perform or observe any provision in Section 5.02, 5.03(e),
5.03(l), 5.04 or 5.05.
(c) Covenants with Grace. If the Borrower or any of its
Subsidiaries (i) shall fail or omit to perform and observe any
agreement set forth in Sections 5.03(a), 5.03(d) or 5.03(f) hereof
and the same shall remain unremedied for ten (10) Business Days or
(ii) shall fail or omit to perform and observe any agreement herein
or in any Related Writing (other than those referred to in clause
(i) of this subsection (c) or in subsections (a) or (b) hereof)
within thirty (30) Business Days after the giving of written notice
to the Borrower by any Bank that it is to be remedied.
(d) Warranties. If any representation, warranty or statement
(other than any made by any Bank or the Agent pursuant to this
Agreement or in any Related Writing) made in this Agreement or in
any Related Writing shall be false or erroneous in any respect when
made or deemed made, as the case may be.
(e) Cross Default. If, in respect of (i) any existing or
future Indebtedness (regardless of maturity), including, without
limitation, any indebtedness evidenced by the Senior Notes, (ii)
other Indebtedness (other than the Obligations) now owing or
hereafter incurred by the Borrower or any of its Subsidiaries,
including without limitation, any Additional Indebtedness or (iii)
any convertible subordinated indebtedness (whether or not
considered to be "Indebtedness" for the purposes of Section 5.05),
there should occur or exist under its original provisions
(including any amendment made prior to the date of this Agreement
but without giving effect to any amendment, consent or waiver after
the date of this Agreement unless consented to in writing by the
Majority Banks) any event, condition or other thing which
constitutes, or which with the giving of notice or the lapse of any
applicable grace period or both would constitute, a default which
accelerates (or permits any creditor or creditors or representative
of creditors to accelerate) the maturity of any such Indebtedness;
or if any such Indebtedness (other than any payable on demand)
shall not be paid in full at its stated maturity; or if any such
Indebtedness payable on demand shall not be paid in full within ten
(10) days after any actual demand for payment.
(f) Change in Control. If any "person" or "group" shall
become the "beneficial owner" (as those terms are respectively used
in the Securities and Exchange Act of 1934, as amended, and the
rules and regulations thereunder) of more than twenty percent (20%)
of the outstanding voting stock of the Borrower or shall otherwise
acquire the power (whether by contract, by proxy or otherwise) to
elect a majority of the Borrower's Board of Directors; provided,
however, that this subsection shall not apply to any person who is
a director of the Borrower on the Closing Date or any other
transaction receiving the prior approval by a majority of the then
members of the Borrower's board of directors.
(g) Judgments. If one or more judgments for the payment of
money in an aggregate amount in excess of One Million Dollars
($1,000,000) (unless such judgment (i) shall have been reserved by
the Borrower or the applicable Subsidiary on the date thereof or
(ii) shall be insured and the insurance carrier shall have
acknowledged in writing liability in respect of the full amount
thereof or shall have been ordered by a court of competent
jurisdiction to pay such judgment) shall be rendered and remain
undischarged against the Borrower or any of its Subsidiaries or any
combination thereof and as to which either (x) execution shall not
be effectively stayed within a period of thirty (30) consecutive
days following the issuance of said judgment or (y) any action
shall be legally taken by a judgment creditor to levy upon assets
or properties of the Borrower or any of its Subsidiaries to enforce
any such judgment.
(h) Subsidiary's Solvency. If (a) any Subsidiary of the
Borrower shall commence any Insolvency Action of any kind or admit
(by answer, default or otherwise) the material allegations of, or
consent to any relief requested in, any Insolvency Action of any
kind commenced against that Subsidiary by its creditors or any
thereof, or (b) any creditor or creditors of any Subsidiary of the
Borrower shall commence against that Subsidiary any Insolvency
Action of any kind which shall remain in effect (neither dismissed
nor stayed) for sixty (60) consecutive days.
(i) Borrower's Solvency. If (a) the Borrower shall
discontinue operations, or (b) the Borrower shall commence any
Insolvency Action of any kind or admit (by answer, default or
otherwise) the material allegations of, or consent to any relief
requested in, any Insolvency Action of any kind commenced against
the Borrower by its creditors or any thereof, or (c) any creditor
or creditors shall commence against the Borrower any Insolvency
Action of any kind which shall remain in effect (neither dismissed
nor stayed) for sixty (60) consecutive days.
(j) ERISA. If (x) the Borrower, any ERISA Affiliate of the
Borrower or any other Person institutes any steps to terminate an
Employee Benefit Plan and, as a result of such termination, the
Borrower or any such ERISA Affiliate could be required to make a
contribution to such Employee Benefit Plan, or could reasonably
expect to incur a liability or obligation to such plan, in excess
of One Hundred Thousand Dollars ($100,000) or (y) the Borrower or
any ERISA Affiliate fails to make a contribution to any Employee
Benefit Plan which failure would be sufficient to give rise to a
Lien under Section 302(f) of ERISA.
(k) Enforceability. If any Guaranty Agreement shall be
revoked by or otherwise cease to be enforceable against any
Guarantor thereunder.
SECTION 6.02 Remedies Upon Event of Default.
Notwithstanding any contrary provision or inference in this
Agreement or in any Related Writing:
(a) Optional Defaults. If any Event of Default referred to in
Section 6.01(a) through 6.01(g), inclusive, or 6.01(j) or 6.01(k)
shall occur and be continuing, the Agent shall at the request of,
or may with the consent of, the Majority Banks (each in its sole
discretion) have the right, by giving written notice to the
Borrower, (A) to terminate each Bank's outstanding Revolving Credit
Commitment whereupon no Bank shall have any obligation thereafter
to make any Loan and (B) to accelerate the maturity of all of the
Loans and all other Indebtedness or Obligations then owing to any
of the Banks and or Agent, as the case may be, or any thereof
(other than Indebtedness, if any, already due and payable), and all
such Indebtedness shall thereupon become and thereafter be
immediately due and payable in full without any presentment or
demand and without any further or other notice of any kind, all of
which are hereby waived by the Borrower; provided, however, that,
notwithstanding the termination of the Revolving Credit
Commitments, the Agent may accrue expenses in accordance with this
Agreement and such expenses shall be deemed to be Revolving Credit
Loans made by each Bank in accordance with its Ratable Portion.
(b) Automatic Defaults. If any Event of Default referred to
in Sections 6.01(h) or 6.01(i) shall occur, (i) the Revolving
Credit Commitments shall automatically and immediately terminate
(if not already expired or reduced to zero pursuant to Article II
or terminated pursuant to this Section) whereupon no Bank shall
have any obligation thereafter to make any Loan and (ii) all of the
Obligations and all other Indebtedness, if any, then owing to the
Banks and the Agent or any thereof (other than Indebtedness, if
any, already due and payable) shall thereupon become and thereafter
be immediately due and payable in full, all without any
presentment, demand or notice of any kind, which are hereby waived
by the Borrower; provided, however, that, notwithstanding the
termination of the Revolving Credit Commitments, the Agent may
accrue expenses in accordance with this Agreement and such expenses
shall be deemed to be Revolving Credit Loans made by each Bank in
accordance with its Ratable Portion.
(c) Recourse of Banks. Each of the Banks acknowledges and
agrees that: (i) it shall only have recourse to the Collateral
through the Agent and that it shall have no independent recourse to
the Collateral and (ii) the Agent shall have no obligation to, and
shall not (except as specifically provided herein) take any action
in respect of enforcing remedies against the Collateral, except
upon the instructions from the Majority Banks. Nothing in this
paragraph shall restrict (A) the rights of any Bank to pursue
remedies, by proceedings in law and equity, to collect any of the
Obligations or to enforce the performance of any provisions of this
Agreement or the Related Writings, to the extent in either case
that such remedies are not related to the Collateral or interfere
with the Agent's ability to take action hereunder or under the
Collateral Documents or (B) the rights of any Bank to initiate any
Insolvency Action in its individual capacity and to appear or be
heard on any matter before the bankruptcy or other applicable court
in any such proceeding, including, without limitation, with respect
to questions concerning the post-petition usage of Collateral and
post-petition financing arrangements.
SECTION 6.03 Offsets. If there shall occur or exist any
Default referred to in Section 6.01(h) or 6.01(i), each Bank shall,
so long as that Default exists, have the right (in addition to such
other rights as it may have by operation of Law or otherwise) at
any time to set off against and to appropriate and apply toward the
payment of the Obligations and all other Indebtedness then owing to
it (and any participation purchased or to be purchased pursuant to
Section 6.04) whether or not the same shall then have matured, any
and all deposit balances then owing by that Bank to or for the
credit or account of the Borrower and its Subsidiaries or any
thereof, all without notice to or demand upon the Borrower or any
Subsidiary or any other Person, all such notices and demands being
hereby expressly waived.
SECTION 6.04 Equalization. Each Bank agrees with the
other Banks that if at any time it shall obtain any Advantage over
the other Banks or any thereof in respect of the Loans it will
purchase from such other Bank or Banks, for cash and at par, such
additional participation in the Loans owing to the other or others
as shall be necessary to nullify the Advantage. If any such
Advantage resulting in the purchase of an additional participation
as aforesaid shall be recovered in whole or in part from the Bank
receiving the Advantage, each such purchase shall be rescinded, and
the purchase price restored (with interest and other charges if and
to the extent actually incurred by the Bank receiving the
Advantage) ratably to the extent of the recovery. During the
existence of any Default, any payment (whether made voluntarily or
involuntarily, by offset of any deposit or other indebtedness or
otherwise) of any Indebtedness owing by the Borrower to any Bank
shall be applied to the Obligations owing to that Bank until the
same shall have been paid in full before any thereof shall be
applied to other Indebtedness owing to that Bank.
SECTION 6.05 Application of Proceeds of Collateral. The
Agent shall apply any and all proceeds received by the Agent in
connection with the Agent's realization upon any of the Collateral
for the benefit of the Banks first to Obligations of the Borrower
to the Banks under this Agreement other than any Obligations of the
Borrower to any Bank under any hedge agreement, swap agreement or
similar agreement between the Borrower and any individual Bank (in
accordance with each Bank's Ratable Portion of such Obligations and
in such order and manner as the Majority Banks shall instruct the
Agent) and then to any other Obligations of the Borrower to the
Banks, or any thereof (in accordance with each Bank's pro rata
portion of such other Obligations based upon the aggregate amount
of such other Obligations and in such order and manner as the
Majority Banks shall instruct the Agent).
ARTICLE VII
THE AGENT
SECTION 7.01 The Agent. Each Bank irrevocably appoints
NCB to be its Agent with full authority to take such actions, and
to exercise such powers, on behalf of the Banks in respect of this
Agreement and the Related Writings as are therein respectively
delegated to the Agent or as are reasonably incidental to those
delegated powers. NCB in such capacity shall be deemed to be an
independent contractor of the Banks.
SECTION 7.02 Nature of Appointment. The Agent shall have
no fiduciary relationship with any Bank by reason of this Agreement
and the Related Writings. The Agent shall not have any duty or
responsibility whatever to any Bank except those expressly set
forth in this Agreement and the Related Writings. Without limiting
the generality of the foregoing, each Bank acknowledges that the
Agent is acting as such solely as a convenience to the Banks and
not as a manager of the Revolving Credit Commitments or the
Indebtedness evidenced by the Notes. This Article VII does not
confer any rights upon the Borrower or anyone else (except the
Banks), whether as a third party beneficiary or otherwise.
SECTION 7.03 NCB as a Bank; Other Transactions. NCB's
rights as a Bank under this Agreement and the Related Writings
shall not be affected by its serving as the Agent. NCB and its
affiliates may generally transact any banking, financial, trust,
advisory or other business with the Borrower or its Subsidiaries
(including, without limitation, the acceptance of deposits, the
extension of credit and the acceptance of fiduciary appointments)
without notice to the Banks, without accounting to the Banks, and
without prejudice to NCB's rights as a Bank under this Agreement
and the Related Writings except as may be expressly required under
this Agreement.
SECTION 7.04 Instructions from Banks. The Agent shall
not be required to exercise any discretion or take any action as to
matters not expressly provided for by this Agreement and the
Related Writings (including, without limitation, collection and
enforcement actions in respect of any Obligations under the Notes
or this Agreement and any collateral therefor) except that the
Agent shall take such action (or omit to take such action) other
than actions referred to in Section 10.01, as may be reasonably
requested of it in writing by the Majority Banks with instructions
and which actions and omissions shall be binding upon all the
Banks; provided, however, that the Agent shall not be required to
act (or omit any act) if, in its judgment, any such action or
omission might expose the Agent to personal liability or might be
contrary to this Agreement, any Related Writing or any applicable
Law. The Agent may, without consent from the Banks, pursuant to
the provisions of Section 2.08, execute termination statements,
mortgage releases, releases of collateral assignment or other
documents evidencing the release of the Liens of the Banks with
respect to any Collateral.
SECTION 7.05 Bank's Diligence. Each Bank (a) represents
and warrants that it has made its decision to enter into this
Agreement and the Related Writings and (b) agrees that it will make
its own decision as to taking or not taking future actions in
respect of this Agreement and the Related Writings; in each case
without reliance on the Agent or any other Bank and on the basis of
its independent credit analysis and its independent examination of
and inquiry into such documents and other matters as it deems
relevant and material.
SECTION 7.06 No Implied Representations. The Agent shall
not be liable for any representation, warranty, agreement or
obligation of any kind of any other party to this Agreement or
anyone else, whether made or implied by the Borrower or any
Subsidiary in this Agreement or any Related Writing or by a Bank in
any notice or other communication or by anyone else or otherwise.
SECTION 7.07 Sub-Agents. The Agent may employ agents and
shall not be liable (except as to money or property received by it
or its agents) for any negligence or misconduct of any such agent
selected by it with reasonable care. The Agent may consult with
legal counsel, certified public accountants and other experts of
its choosing (including, without limitation, NCB's salaried
employees or any otherwise not independent) and shall not be liable
for any action or inaction taken or suffered in good faith by it in
accordance with the advice of any such counsel, accountants or
other experts which shall have been selected by it with reasonable
care.
SECTION 7.08 Agent's Diligence. The Agent shall not be
required (a) to keep itself informed as to anyone's compliance with
any provision of this Agreement or any Related Writing, (b) to make
any inquiry into the properties, financial condition or operation
of the Borrower or any of its Subsidiaries or any other matter
relating to this Agreement or any Related Writing, (c) to report to
any Bank any information (other than which this Agreement or any
Related Writing expressly requires to be so reported) that the
Agent or any of its affiliates may have or acquire in respect of
the properties, business or financial condition of the Borrower or
any of its Subsidiaries or any other matter relating to this
Agreement or any Related Writing or (d) to inquire into the
validity, effectiveness or genuineness of this Agreement or any
Related Writing.
SECTION 7.09 Notice of Default. The Agent shall not be
deemed to have knowledge of any Default unless and until it shall
have received a written notice describing it and citing the
relevant provision of this Agreement or any Related Writing. The
Agent shall give each Bank reasonably prompt notice of any such
written notice except, of course, to any Bank that shall have given
the written notice.
SECTION 7.10 Agent's Liability. Neither the Agent nor
any of its directors, officers, employees, attorneys, and other
agents shall be liable for any action or omission on their
respective parts except for gross negligence or willful misconduct.
Without limitation of the generality of the foregoing, the Agent:
(i) may treat the payee of any Revolving Credit Note as the holder
thereof until the Agent receives a fully executed copy of the
Assignment Agreement required by Section 8.01(b) signed by such
payee and in form satisfactory to the Agent; (ii) may consult with
legal counsel, independent public accountants and other experts
selected by it and shall not be liable for any action taken or
omitted to be taken in good faith by it in accordance with the
advice or such counsel, accountants or experts which have been
selected by the Agent with reasonable care; (iii) makes no warranty
or representation to any Bank and shall not be responsible to any
Bank for any statements, warranties or representations made in or
in connection with this Agreement, any Collateral Document or any
other Related Writing, including, without limitation, the truth of
the statements made in any certificate delivered by the Borrower
under Article III, the Agent being entitled for the purposes of
determining fulfillment of the conditions set forth therein to rely
conclusively upon such certificates; (iv) shall not have any duty
to ascertain or to inquire as to the performance or observance of
any of the terms, covenants or conditions of this Agreement, any
Collateral Document or any other Related Writing or to inspect the
property (including the books and records) of the Borrower or its
Subsidiaries; (v) shall not be responsible to any Bank for the due
execution, legality, validity, enforceability, genuineness,
sufficiency or value of this Agreement, any Collateral Document or
collateral covered thereby or any other Related Writing and (vi)
shall incur no liability under or in respect of this Agreement or
any Collateral Document or other Related Writing by acting upon any
notice, consent, certificate or other instrument or writing (which
may be by telegram, telecopy, cable or telex) believed by it in
good faith to be genuine and correct and signed or sent by the
proper party or parties.
Neither the Agent nor any of its directors, officers,
employees or agents shall have any responsibility to the Borrower
on account of the failure of or delay in performance or breach by
any Bank of any of its obligations hereunder or to any Bank on
account of the failure of or delay in performance or breach by any
other Bank or the Borrower of any of their respective obligations
hereunder or under any Related Writing or in connection herewith or
therewith.
The Banks each hereby acknowledge that the Agent shall be
under no duty to take any discretionary action permitted to be
taken by it pursuant to the provisions of this Agreement or any
Collateral Document or any other Related Writing unless it shall be
requested in writing to do so by the Majority Banks.
SECTION 7.11 Compensation. Except for the fee set forth
in Section 2.05(b), the Agent shall receive no other compensation
for its services as agent of the Banks in respect of this Agreement
and the Related Writings, except any expressly referred to in this
Agreement, but the Borrower shall reimburse the Agent periodically
on its demand for out-of-pocket expenses, if any, reasonably
incurred by it as such.
SECTION 7.12 Agent's Indemnity. The Banks shall
indemnify the Agent (to the extent the Agent is not reimbursed by
the Borrower) from and against (a) any loss or liability (other
than any caused by the Agent's gross negligence or willful
misconduct and other than any loss to the Agent resulting from the
Borrower's non-payment of agency fees owed solely to the Agent)
incurred by the Agent as such in respect of this Agreement or any
Related Writing (as the Agent) and (b) any out-of-pocket expenses
incurred in defending itself or otherwise related to this
Agreement, the Collateral Documents or any Related Writing (other
than any caused by the Agent's gross negligence or willful
misconduct) including, without limitation, reasonable fees and
disbursements of legal counsel of its own selection (including,
without limitation, the reasonable interdepartmental charges of its
salaried attorneys) in the defense of any claim against it or in
the prosecution of its rights and remedies as the Agent (other than
the loss, liability or costs incurred by the Agent in the defense
of any claim against it by the Banks arising in connection with its
actions in its capacity as Agent); provided, however, that each
Bank shall be liable for only its Ratable Portion of the whole loss
or liability.
SECTION 7.13 Resignation. The Agent (or any successor)
may at any time resign as such by giving ten (10) days' prior
written notice to the Borrower and to each Bank; and the Majority
Banks may remove the Agent at any time with or without cause by
giving written notice to the Agent and the Borrower. In any such
case, the Majority Banks may appoint a successor to the resigned or
removed agent (the "Former Agent"), provided that the Majority
Banks obtain the Borrower's prior written consent to the successor
(which consent shall not be unreasonably withheld), by giving
written notice to the Borrower, the Former Agent and each Bank not
participating in the appointment; provided, however, that, if at
the time of the proposed resignation or removal of an Agent, the
Borrower is the subject of an Insolvency Action or an Event of
Default shall have occurred and be continuing the Borrower's
consent shall not be required. In the absence of a timely
appointment, the Former Agent shall have the right (but not the
duty) to make a temporary appointment of any Bank (but only with
that Bank's consent) to act as its successor pending an appointment
pursuant to the immediately preceding sentence. In either case,
the successor Agent shall deliver its written acceptance of
appointment to the Borrower, to each Bank and to the Former Agent,
whereupon (a) the Former Agent shall execute and deliver such
assignments and other writings as the successor Agent may
reasonably require to facilitate its being and acting as the Agent,
(b) the successor Agent shall in any event automatically acquire
and assume all the rights and duties as those prescribed for the
Agent by this Article VII and (c) the Former Agent shall be
discharged from its duties and obligations under this Agreement and
the Related Writings.
SECTION 7.14 Bank Purpose. Each Bank represents and
warrants to the Agent, the other Banks and the Borrower that such
Bank is familiar with the Securities Act of 1933, as amended, and
the rules and regulations thereunder and is not entering into this
Agreement with any intention to violate such Act or any rule or
regulation thereunder. Subject to the provisions of Sections 8.01
and 8.02, each Bank shall at all times retain full control over the
disposition of its assets subject only to this Agreement and to all
applicable Law.
SECTION 7.15 Bank Indemnification. Each Bank providing
cash management or similar services to the Borrower agrees to
indemnify each of the other Banks (the "Other Banks") from and
against any and all liabilities, obligations, losses, damages,
penalties, actions, judgments, suits, costs, expenses or
disbursements of any kind or nature whatsoever that may be imposed
on, incurred by, or asserted against any Other Bank in any way
relating to or arising out of the cash management or similar
services provided by such Bank to the Borrower or any of its
Subsidiaries or any action or inaction of such Bank in connection
therewith.
ARTICLE VIII
TRANSFERS AND ASSIGNMENTS
SECTION 8.01 Transfer of Commitments. Each Bank shall
have the right at any time or times to transfer to another
financial institution, without recourse, all or any part of (a)
that Bank's Revolving Credit Commitment, (b) any Revolving Credit
Loan made by that Bank, (c) any Revolving Credit Note delivered to
that Bank pursuant to this Agreement, and (d) that Bank's
participations, if any, purchased pursuant to Section 6.04;
provided, however, in each such case, that the transferor and the
transferee shall have complied with the following requirements:
(a) Prior Consent. No transfer may be consummated pursuant to
this Article VIII without the prior written consent of the Borrower
and the Agent, which consent of the Borrower shall not be
unreasonably withheld; provided, however, that, neither the
Borrower nor the Agent shall be deemed to be unreasonable in
withholding its respective consent if, (i) after giving effect to
such transfer, any Bank's (including any assignee becoming a Bank
pursuant to this Section 8.01) Ratable Portion of the aggregate
Revolving Credit Commitments would be less than Ten Million Dollars
($10,000,000), (ii) the proposed transferee is a financial
institution not organized under the laws of a state or of the
United States (unless such institution is an affiliate of the
transferring Bank) or (iii) if the proposed transferee's long-term
certificates of deposit shall be rated A or below by any Rating
Agency or the equivalent rating by Thompson's Bank Watch; provided,
further, that, if at the time of the proposed transfer the Borrower
is the subject of an Insolvency Action, the Borrower's consent
shall not be required. Notwithstanding anything to the contrary,
any Bank may at any time assign all or any portion of its rights
under this Agreement and its Notes to a Federal Reserve Bank, and
no such assignment shall release such assigning Bank from its
obligations hereunder.
(b) Agreement; Transfer Fee. The transferor (i) shall remit
to the Agent an administrative fee of Two Thousand Five Hundred
Dollars ($2,500) and (ii) shall cause the transferee to execute and
deliver to the Borrower, the Agent and each Bank (A) an Assignment
Agreement, in the form of Exhibit N hereto together with the
consents and releases referenced therein and (B) such additional
amendments, assurances and other writings as the Agent may
reasonably require.
(c) Note. The Borrower shall execute and deliver (i) to the
Agent, the transferor and the transferee, any consent or release
(of all or a portion of the obligations of the transferor) to be
delivered in connection with the Assignment Agreement, (ii) if a
Bank's entire interest in its Revolving Credit Commitment and in
all of its Loans have been transferred, to the transferee an
appropriate Note against return of the Note (marked "replaced")
held by the transferor and (iii) if only a portion of a Bank's
interest in its Revolving Credit Commitment and its Loans has been
transferred, a new Note to each of the transferor and the
transferee against return of the original Note of the transferor
(marked "replaced") held by the transferor.
(d) Parties. Upon satisfaction of the requirements of this
Section 8.01, including the payment of the fee and the delivery of
the documents set forth in Section 8.01(b), (i) the transferee
shall become and thereafter be deemed to be a "Bank" for the
purposes of this Agreement and (ii) the transferor (A) shall
continue to be a "Bank" for the purposes of this Agreement only if
and to the extent that the transfer shall not have been a transfer
of its entire interest in its Revolving Credit Commitment and its
Loans, (B) shall cease to be and thereafter shall no longer be
deemed to be a "Bank" in the case of any transfer of its entire
interest in its Revolving Credit Commitments and its Loans and (C)
the signature pages hereto and Schedule I hereto shall be
automatically amended, without further action, to reflect the
result of any such transfer.
SECTION 8.02 Sale of Participations. Each Bank shall
have the right at any time or times to sell one or more
participations or subparticipations to a financial institution, as
the case may be, in all or any part of (a) that Bank's Revolving
Credit Commitment, (b) any Revolving Credit Loan made by that Bank,
(c) any Note delivered to that Bank pursuant to this Agreement, and
(d) that Bank's participations, if any, purchased pursuant to
Section 6.04 or this Section 8.02.
(a) Benefits of Participant. The provisions of Article IX
shall inure to the benefit of each purchaser of a participation or
subparticipation (provided that each such participant shall look
solely to the seller of its participation for those benefits and
the Borrower's liabilities, if any, under any of those sections
shall not be increased as a result of the sale of any such
participation) and Agent shall continue to distribute payments
pursuant to this Agreement as if no participation has been sold.
(b) Rights Reserved. In the event any Bank shall sell any
participation or subparticipation, that Bank shall, as between
itself and the purchaser, retain all of its rights (including,
without limitation, rights to enforce against the Borrower this
Agreement and the Related Writings) and duties pursuant to this
Agreement and the Related Writings, including, without limitation,
that Bank's right to approve any waiver, consent or amendment
pursuant to Section 10.01, except if and to the extent that any
such waiver, consent or amendment would
(i) reduce any fee or commission allocated to the
participation or subparticipation, as the case may be,
(ii) reduce the amount of any principal payment on any
Revolving Credit Loan allocated to the participation or
subparticipation, as the case may be, or reduce the principal
amount of any Revolving Credit Loan so allocated or the rate of
interest payable thereon, or
(iii) extend the time for payment of any amount allocated
to the participation or subparticipation, as the case may be.
(c) No Delegation. No participation or subparticipation shall
operate as a delegation of any duty of the seller thereof. Under
no circumstance shall any participation or subparticipation be
deemed a novation in respect of all or any part of the seller's
obligations pursuant to this Agreement.
SECTION 8.03 Confidentiality. Each Bank hereby (a)
acknowledges that the Borrower and each of its Subsidiaries have
many trade secrets and much financial, environmental and other data
and information the confidentiality of which is important to their
business and (b) agrees to keep confidential any such trade secret,
data or information designated by the Borrower or any of its
Subsidiaries as confidential, except that this Section shall not
preclude any Bank from furnishing any such secret, data or
information: (i) as may be required by order of any court of
competent jurisdiction or requested by any governmental agency
having any regulatory authority over that Bank or its securities or
in response to legal process, (ii) to any other party to this
Agreement, (iii) or to any actual or prospective transferee,
participant or subparticipant (so long as such prospective
transferee, participant or subparticipant is a financial
institution) of all or part of that Bank's rights arising out of or
in connection with the Related Writings and this Agreement or any
thereof so long as such prospective transferee, participant or
subparticipant to whom disclosure is made agrees to be bound by the
provisions of this Section 8.03, (iv) to anyone if it shall have
been already publicly disclosed (other than by that Bank in
contravention of this Section 8.03), (v) to the extent reasonably
required in connection with the exercise of any right or remedy
under this Agreement or any Related Writing, (vi) to that Bank's
legal counsel, auditors and accountants and (vii) in connection
with any legal proceedings instituted by or against the Agent or
any Bank.
ARTICLE IX
INDEMNITIES
SECTION 9.01 Increased Costs. If, due to either (i) the
introduction of or any change (other than any change by way of
imposition or increase of reserve requirements in respect of LIBOR
Rate Loans otherwise included in the Eurocurrency Reserve
Percentage) in or in the interpretation of any Law or regulation or
(ii) the compliance with any guideline or request from any central
bank or other governmental authority (whether or not having the
force of Law), there shall be any increase in the cost to any Bank
of agreeing to make or making, funding or maintaining Revolving
Credit Loans, then the Borrower shall from time to time, upon
demand by such Bank (with a copy of such demand to the Agent), pay
to the Agent for the account of such Bank additional amounts
sufficient to indemnify such Bank for such increased cost.
SECTION 9.02 Risk-Based Capital. If any Bank determines
that (i) compliance with any Law or regulation or any
interpretation thereof or (ii) compliance with any guideline or
request from any central bank or other governmental authority
(whether or not having the force of Law) affects or would affect
the amount of capital required or expected to be maintained by such
Bank or any corporation controlling such Bank and that the amount
of such capital required to be so maintained is increased by or
based upon the existence of such Bank's Revolving Credit Commitment
to lend hereunder and other commitments of this type, then, upon
demand by such Bank (with a copy of such demand to the Agent), the
Borrower shall immediately pay to the Agent for the account of such
Bank, from time to time as specified by such Bank, additional
amounts sufficient to indemnify such Bank or such corporation, to
the extent that such Bank reasonably determines such increase in
capital to be allocable to the existence of such Bank's Revolving
Credit Commitment to lend hereunder.
SECTION 9.03 Taxes.
(a) Taxes; Withholding. Any and all payments by the Borrower
hereunder, under the Notes or the other Related Writings shall be
made, in accordance with the provisions of Article II, free and
clear of and without deduction for any and all present or future
taxes, levies, imposts, deductions, charges or withholdings, and
all liabilities with respect thereto, excluding, in the case of
each Bank, taxes imposed on its income, and franchise taxes imposed
on it, by the jurisdiction under the Laws of which such Bank is
organized or any political subdivision thereof (all such
non-excluded taxes, levies, imposts, deductions, charges,
withholdings and liabilities being hereinafter referred to as
"Taxes"). If the Borrower shall be required by Law to deduct any
Taxes from or in respect of any sum payable hereunder or under any
Note to any Bank or the Agent, (i) the sum payable shall be
increased as may be necessary so that after making all required
deductions (including deductions applicable to additional sums
payable under this Section 9.03) such Bank (as the case may be)
receives an amount equal to the sum it would have received had no
such deductions been made, (ii) the Borrower shall make such
deductions and (iii) the Borrower shall pay the full amount
deducted to the relevant taxation authority or other authority in
accordance with applicable Law. All such Taxes shall be paid by
the Borrower prior to the date on which penalties attach thereto or
interest accrues thereon; provided, however, that, if any such
penalties or interest become due, the Borrower shall make prompt
payment thereof to the appropriate governmental authority. The
Borrower shall indemnify each Bank for the full amount of such
Taxes (including any Taxes on amounts payable under this Section
9.03 paid by the Bank and any liability (including penalties,
interest and expenses) arising therefrom or with respect thereto,
whether or not such Taxes were correctly or legally asserted. Any
indemnification payment shall be made within thirty (30) days from
the date the Bank makes written demand therefor.
(b) Stamp Taxes. The Borrower agrees to pay, and will
indemnify each Bank and the Agent for, any present or future stamp
or documentary taxes or any other excise or property taxes, charges
or similar levies which arise from any payment made hereunder or
under the Notes or from the execution, delivery or registration of,
or otherwise with respect to, this Agreement or the Notes
(hereinafter referred to as "Other Taxes").
(c) Other Taxes. The Borrower will indemnify each Bank and the
Agent for the full amount of Taxes or Other Taxes (including,
without limitation, any Taxes or Other Taxes imposed by any
jurisdiction on amounts payable under this section 9.03) paid by
such Bank or the Agent (as the case may be) and any liability
(including penalties, interest and expenses) arising therefrom or
with respect thereto, whether or not such Taxes or Other Taxes were
correctly or legally asserted. Any indemnification payment shall
be made within 30 days from the date such Bank or the Agent (as the
case may be) makes written demand therefor.
(d) Request for Refund. At the reasonable request of the
Borrower, a Bank or the Agent shall apply at the Borrower's expense
for a refund in respect of Taxes or Other Taxes previously paid by
the Borrower pursuant to this Section 9.03 if in the opinion of
such Bank or the Agent there is a reasonable basis for such refund.
Notwithstanding the foregoing, none of the Banks or the Agent shall
be obligated to pursue such refund if, in its sole good faith
judgment, such action would be disadvantageous to it. If any Bank
subsequently receives from a taxing authority a refund of any Tax
previously paid by the Borrower and for which the Borrower has
indemnified the Bank pursuant to this Section 9.03, such Bank shall
within thirty (30) days after receipt of such refund, and to the
extent permitted by applicable law, pay to the Borrower the net
amount of any such recovery after deducting taxes and expenses
attributable thereto.
(e) Exemption Certificate. Not later than the Closing Date
or, in the case of any bank or financial institution that becomes
a Bank after the Closing Date, pursuant to Article VIII, the date
of the instrument of assignment pursuant to which such bank or
financial institution became a Bank, and annually on each
Anniversary Date thereafter or at such other times as the Agent or
the Borrower may request, (i) each Bank organized under the laws of
a jurisdiction outside the United States shall provide the Agent
and the Borrower with duly completed copies of Form 1001 or Form
4224 or any successor form prescribed by the Internal Revenue
Service of the United States certifying that such Bank is exempt
from United States withholding taxes with respect to all payments
to be made to such Bank hereunder or other document satisfactory to
the Borrower and the Agent indicating that all payments to be made
to such Bank hereunder are not subject to such taxes and (ii) each
other Bank shall provide the Agent and the Borrower with a written
statement that it is not a non-resident alien or foreign
corporation and which otherwise satisfies Treasury Regulation Section
1.1441-5(b) or any successor regulation under the Internal Revenue
Code (each such certificate or statement, an "Exemption
Certificate"). Unless the Agent and the Borrower have received an
Exemption Certificate from such Bank, the Borrower, or the Agent if
the Borrower has not withheld, may withhold taxes from such
payments at the applicable statutory rate (subject, in the case of
the Borrower to the requirements of Section 9.03(a)); provided,
however, that if the Borrower has withheld it shall so notify the
Agent. If the Borrower is required to pay additional amounts to
any Bank pursuant to this Section 9.03, such Bank shall use
reasonable efforts to designate a different Lending office if such
designation will thereafter avoid the need for any additional
payments under this Section 9.03 and will not, in the sole judgment
of such Bank, be otherwise disadvantageous to such Bank. A Bank
which ceases to be exempt from United States withholding taxes
shall notify the Agent and the Borrower promptly thereof.
(f) Furnishing of Certificate. Within 30 days after the date
of any payment of Taxes, the Borrower will furnish to the Agent, at
its address referred to in Section 10.09, the original or a
certified copy of a receipt evidencing payment thereof. The
Borrower hereby represents and warrants to the Agent and each of
the Banks that no Taxes are payable in respect of any payment made
hereunder. If Taxes ever become payable in respect of any payment
hereunder or under the Notes made during a Fiscal Quarter,
thereafter the Borrower will furnish to the Agent, within 30 days
after the end of such Fiscal Quarter, at such address, a
certificate from the Borrower stating that any payments made during
such Fiscal Quarter are exempt from or not subject to Taxes.
(g) Survival of Provision. Without prejudice to the survival
of any other agreement of the Borrower hereunder, the agreements
and liabilities of the Borrower contained in this Section 9.03
shall survive the payment in full of the Obligations.
SECTION 9.04 Funding Costs. The Borrower agrees to
indemnify each Bank against any loss relating in any way to its
funding of any LIBOR Rate Loan paid before its stated maturity
(whether a prepayment or a payment following any acceleration of
maturity or otherwise) and to pay that Bank, as liquidated damages
for any such loss, an amount (discounted to the present value in
accordance with standard financial practice at a rate equal to the
treasury yield) equal to interest computed on the principal payment
from the payment date to the respective stated maturities thereof
at a rate equal to the difference of the contract rate less the
treasury yield, all as determined by that Bank in its reasonable
discretion. Treasury yield means the annual yield on direct
obligations of the United States having a principal amount and
maturity similar to that of the principal being paid.
SECTION 9.05 Losses. If any payment of principal of or
Rate Conversion or Rate Continuation of, any LIBOR Rate Loan is
made other than on the last day of an Interest Period relating to
such Loan, as a result of a payment or Rate Conversion or Rate
Continuation pursuant to the provisions of Article II or
acceleration of the maturity of the Notes pursuant to Section 6.02
or for any other reason, the Borrower shall, upon demand by any
Bank (with a copy of such demand to the Agent), pay to the Agent
for the account of such Bank any amounts (discounted to the present
value in accordance with standard financial practice at a rate
equal to the treasury yield) required to compensate such Bank for
any additional losses, costs or expenses which it may reasonably
incur as a result of such payment or Rate Conversion or Rate
Continuation, including, without limitation, any loss (including
loss of anticipated profits), cost or expense incurred by reason of
the liquidation or reemployment of deposits or other funds acquired
by such Bank to fund or maintain such Loan.
SECTION 9.06 Indemnification for Requests. Whenever the
Borrower (a) shall revoke any Credit Request, any Rate
Conversion/Continuation Request involving any LIBOR Rate Loan, (b)
shall for any other reason fail to borrow pursuant to any such
Request or otherwise comply therewith, (c) shall fail to fulfill,
on or before the date specified in any such request, the applicable
conditions set forth in Article III of this Agreement or (d) shall
fail to honor any prepayment notice, then, in each case on any
Bank's demand, the Borrower shall indemnify each Bank and the Agent
against any loss, cost or expense incurred by such Bank or the
Agent as a result of any such failure by the Borrower, including,
without limitation, any loss (including loss of anticipated
profits), cost or expense incurred by reason of the liquidation or
reemployment of deposits or other funds acquired by such Bank or
the Agent to fund the LIBOR Rate Loan to be made by such Bank or
the Agent in connection with such request when such LIBOR Rate
Loan, as a result of such failure by the Borrower, is not made on
such date.
SECTION 9.07 Takeovers. The Borrower agrees to indemnify
each Bank and Agent and hold each Bank and the Agent harmless from
and against any and all liabilities, losses, damages, costs and
expenses of any kind (including, without limitation, the reasonable
fees and disbursements of counsel for each Bank and the Agent) in
connection with any investigative, administrative or judicial
proceeding which may be incurred by any Bank or the Agent relating
to or arising out of any actual or proposed use of proceeds of the
extensions of credit hereunder in connection with the financing of
an acquisition or proposed acquisition of all or substantially all
of the assets or the stock of any corporation or other business
entity, except that no Bank or the Agent shall have the right to be
indemnified hereunder for its own gross negligence or willful
misconduct.
SECTION 9.08 Certificate for Indemnification. Each demand
by Agent or a Bank for payment pursuant to Article IX shall be
accompanied by a certificate setting forth the reason for the
payment, the amount to be paid, and the computations and
assumptions in determining the amount, which certificate shall be
presumed to be correct. In determining the amount of any such
payment thereunder, each Bank may use reasonable averaging and
attribution methods.
SECTION 9.09 Costs and Expenses. The Borrower agrees to
pay on demand all reasonable costs and expenses of the Agent in
connection with the preparation, execution, delivery, modification,
administration and amendment of this Agreement (including, without
limitation, any amendment), the Notes, the Collateral Documents,
the Relating Writings and the other documents to be delivered
hereunder, including, without limitation, the reasonable fees and
out-of-pocket expenses of counsel for the Agent with respect
thereto (including any reasonable interdepartmental charges) and
with respect to advising the Agent as to its rights and
responsibilities under this Agreement. Without limiting the
generality of the foregoing, such costs and expenses shall include:
(a) reasonable attorneys' and paralegal's costs, expenses and
disbursements of counsel to the Agent; (b) costs and expenses
(including reasonable attorneys and paralegal costs, expenses and
disbursements) for any amendment, supplement, waiver, consent, or
subsequent closing in connection with the Credit Agreement, the
Collateral Documents or any other Related Writing and the
transactions contemplated thereby; (c) costs and expenses of lien
and title searches and title insurance; (d) taxes, costs, expenses
and other charges for recording the Borrower Mortgages, recording
the Collateral Assignments, filing financing statements and
continuations, and other actions to perfect, protect, and continue
the Liens in favor of the Agent for the benefit of the Banks; (e)
sums paid or incurred to pay any amount or take any action required
of the Borrower under this Agreement, the Collateral Documents or
any other Related Writing that the Borrower fails to pay or take;
(f) costs of appraisals pursuant to Section 5.03(m), the Borrower's
portion of any appraisal required under Section 5.03(n) and the
cost of any appraisal, survey, environmental audit or the retention
of any other professional service or consultant commenced after the
occurrence and continuation of an Event of Default and deemed
reasonably necessary by the Agent; (g) costs of inspections, and
verifications of the Collateral, including, without limitation,
travel, lodging, and meals for inspections of the Collateral and
the Borrower's operations by the Agent up to one time per year and
at any time after the occurrence and continuation of an Event of
Default; (h) costs and expenses of forwarding loan proceeds and
payments to the Banks; (i) costs and expenses of preserving and
protecting the Collateral; and (j) costs and expenses (including,
without limitation, attorneys' fees) paid or incurred to obtain
payment of the Obligations (including the Obligations arising under
this Section 9.09), enforce the security interest, sell or
otherwise realize upon the Collateral, and otherwise enforce the
provisions of the Loan Documents, or to defend any claims made or
threatened against the Agent arising out of the transactions
contemplated hereby (including without limitation, preparations for
and consultations concerning any such matters). The Borrower
further agrees to pay on demand all costs and expenses of each
Bank, if any (including reasonable counsel fees and expenses), in
connection with the enforcement (whether through negotiations,
legal proceedings or otherwise) of this Agreement, the Notes and
the other documents to be delivered hereunder, including, without
limitation, reasonable counsel fees and expenses in connection with
the enforcement of rights under this Section 9.09. The foregoing
shall not be construed to limit any other provisions of this
Agreement, the Collateral Documents or any related writing
regarding costs and expenses to be paid by the Borrower. All of
the foregoing costs and expenses may be charged, in the Agent's
sole discretion, to the Borrower's loan account as Revolving Credit
Advances.
SECTION 9.10 Duty To Mitigate. Each Bank seeking payment
pursuant to Article IX, other than pursuant to Section 9.09, shall
use reasonable efforts and take all reasonable actions to avoid the
cause of the payment and to minimize the amount thereof.
ARTICLE X
MISCELLANEOUS
This Agreement and the Related Writings shall be governed
by the following provisions:
SECTION 10.01 Amendments and Waivers. No amendment or
waiver of any provision of this Agreement or the Notes, nor consent
to any departure by the Borrower therefrom, shall in any event be
effective unless the same shall be in writing and signed by the
Majority Banks, and then such waiver or consent shall be effective
only in the specific instance and for the specific purpose for
which given; provided, however, that no amendment, waiver or
consent shall, unless in writing and signed by all the Banks, do
any of the following: (a) waive any of the conditions specified in
Article III except in compliance with Section 2.09(a) or add any
asset as a Borrowing Base Asset which is not an Eligible Operator
Loan or an Eligible Operator Lease except in compliance with
Section 2.09(a), (b) increase the Revolving Credit Commitments of
the Banks or subject the Banks to any additional obligations, (c)
reduce the principal of, or interest on, the Notes or any fees or
other amounts payable hereunder, (d) change the method of computing
of interest or any fee or extend or shorten any Interest Period,
(e) postpone any date fixed for any payment in respect of principal
of, or interest on, the Notes or any fees or other amounts payable
hereunder, (f) except as specifically provided by Section 8.01,
change the percentage of the Revolving Credit Commitments or of the
aggregate unpaid principal amount of the Notes, or the number of
Banks, which shall be required for the Banks or any of them to take
any action hereunder, (g) release any Collateral other than as
provided in Section 2.08, (h) amend this Section 10.01, (i) amend,
modify or waive Sections 1.04, 5.03(m), 5.03(n), 2.09(a) or 8.01 or
amend, modify or waive any provision of this Agreement where such
provision requires consent or waiver by all Banks or any amendment
of such a provision which would amend such requirement of consent
by all Banks; and provided, further, that no amendment, waiver or
consent shall, unless in writing and signed by the Agent in
addition to the Banks required above to take such action, affect
the rights or duties of the Agent under this Agreement or any Note.
SECTION 10.02 Cumulative Provisions. Each right, power
or privilege specified or referred to in this Agreement is in
addition to and not in limitation of any other rights, powers and
privileges that the Banks and the Agent may respectively otherwise
have or acquire by operation of Law, by other contract or
otherwise.
SECTION 10.03 Binding Effect. This Agreement shall
become effective when it shall have been executed by the Borrower
and the Agent and when the Agent shall have been notified by each
Bank that such Bank has executed it and thereafter shall be binding
upon and inure to the benefit of the Borrower, the Agent and each
Bank and their respective successors and assigns, except that the
Borrower shall not have the right to assign its rights hereunder or
any interest herein without the prior written consent of all of the
Banks.
SECTION 10.04 Survival of Provisions. All
representations and warranties made in or pursuant to this
Agreement shall survive the execution and delivery of this
Agreement and of the Notes. The provisions of Article IX and the
indemnification provisions set forth in Article II and Article VII
shall survive the payment of the Obligations and any other
Indebtedness owed by the Borrower hereunder.
SECTION 10.05 Immediate U.S. Funds. Unless specifically
designated otherwise, any reference to money is a reference to
lawful money of the United States of America which, if in the form
of credits, shall be in immediately available funds.
SECTION 10.06 Captions. The several captions to
different Articles and to different sections and the respective
subsections thereof are inserted for convenience only and shall be
ignored in interpreting the provisions of this Agreement.
SECTION 10.07 Interest Rate Limitation. Notwithstanding
anything herein to the contrary, if at any time the applicable
interest rate, together with all fees and charges that are treated
as interest under applicable law as provided for herein or in any
other document executed in connection herewith, or otherwise
contracted for, charged, taken, received or reserved by any Bank,
shall exceed the maximum lawful rate that may be contracted for,
charged, taken, received or reserved by such Bank in accordance
with applicable law, the rate of interest and all such charges
payable, contracted for, charged, taken, received or reserved to or
by such Bank in respect of the Revolving Credit Loans of such Bank
shall be limited to the maximum rate permitted by applicable Law.
SECTION 10.08 Illegality. If any provision in this
Agreement or any Related Writing shall for any reason be or become
illegal, void or unenforceable, that illegality, voidness or
unenforceability shall not affect any other provision.
SECTION 10.09 Notices. All notices and other
communications provided for hereunder shall be in writing
(including telecopier, telegraphic, telex or cable communication)
and mailed, telecopied, telegraphed, telexed, cabled or delivered,
to the intended recipient at the "Address for Notices" specified
below its name on the signature pages hereof; or, as to any party,
at such other address as shall be designated by such party in a
written notice to each of the other parties. All such notices and
communications shall, when mailed, telecopied, telegraphed, telexed
or cabled, be effective when deposited in the mails, telecopied,
delivered to the telegraph company, confirmed by telex answerback
or delivered to the cable company, respectively, except that
notices and communications to the Agent pursuant to Article II or
VI shall not be effective until received by the Agent.
SECTION 10.10 Governing Law. This Agreement and the
Related Writings and the respective rights and obligations of the
parties hereto shall be governed by and construed in accordance
with the internal laws of the State of Ohio (without giving effect
to the conflict of laws rules thereof).
SECTION 10.11 Entire Agreement. This Agreement and the
Related Writings referred to in or otherwise contemplated by this
Agreement set forth the entire agreement of the parties as to the
transactions contemplated by this Agreement.
SECTION 10.12 Waiver of Jury Trial. THE PARTIES
ACKNOWLEDGE AND AGREE THAT ANY CONTROVERSY THAT MAY ARISE UNDER
THIS AGREEMENT, THE NOTES, THE COLLATERAL DOCUMENTS OR THE RELATED
WRITINGS WOULD INVOLVE DIFFICULT AND COMPLEX ISSUES AND THEREFORE
AGREE THAT ANY LAW SUIT GROWING OUT OF OR INCIDENTAL TO ANY SUCH
CONTROVERSY WILL BE TRIED IN A COURT OF COMPETENT JURISDICTION BY
A JUDGE SITTING WITHOUT A JURY. THE BORROWER CONFIRMS THAT THE
FOREGOING WAIVER IS INFORMED AND FREELY MADE.
SECTION 10.13 Jurisdiction; Venue; Inconvenient Forum.
(a) Jurisdiction. EACH OF THE PARTIES HERETO HEREBY
IRREVOCABLY AND UNCONDITIONALLY SUBMITS, FOR ITSELF AND ITS
PROPERTY, TO THE NONEXCLUSIVE JURISDICTION OF ANY OHIO STATE COURT
OR FEDERAL COURT OF THE UNITED STATED OF AMERICA SITTING IN
CUYAHOGA COUNTY, OHIO, AND ANY APPELLATE COURT FROM ANY THEREOF, IN
ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS
AGREEMENT, THE NOTES, THE COLLATERAL DOCUMENTS OR ANY RELATED
WRITING, OR FOR RECOGNITION OR ENFORCEMENT OF ANY JUDGMENT, AND
EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY AND UNCONDITIONALLY
AGREES THAT ALL CLAIMS IN RESPECT OF ANY SUCH ACTION OR PROCEEDING
MAY BE HEARD AND DETERMINED IN ANY SUCH OHIO STATE OR, TO THE
EXTENT PERMITTED BY LAW, IN SUCH FEDERAL COURT. EACH OF THE
PARTIES HERETO AGREES THAT A FINAL JUDGMENT IN ANY SUCH ACTION OR
PROCEEDING SHALL BE CONCLUSIVE AND MAY BE ENFORCED IN OTHER
JURISDICTIONS BY SUIT ON THE JUDGMENT OR IN ANY OTHER MANNER
PROVIDED BY LAW. NOTHING IN THIS AGREEMENT SHALL AFFECT ANY RIGHT
THAT ANY PARTY MAY OTHERWISE HAVE TO BRING ANY ACTION OR PROCEEDING
RELATING TO THIS AGREEMENT, ANY COLLATERAL DOCUMENT OR ANY RELATED
WRITING IN THE COURTS OF ANY JURISDICTION.
(b) Venue; Inconvenient Forum. EACH OF THE PARTIES HERETO
HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVES, TO THE FULLEST
EXTENT IT MAY LEGALLY AND EFFECTIVELY DO SO, ANY OBJECTION THAT IT
MAY NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY SUIT,
ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT,
ANY COLLATERAL DOCUMENT OR ANY OTHER RELATED WRITING IN ANY OHIO
STATE OR FEDERAL COURT SITTING IN OHIO. EACH OF THE PARTIES HERETO
HEREBY WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW, THE DEFENSE
OF AN INCONVENIENT FORUM TO THE MAINTENANCE OF SUCH ACTION OR
PROCEEDING IN ANY SUCH COURT. THE BORROWER CONFIRMS THAT THE
FOREGOING WAIVERS ARE INFORMED AND FREELY MADE.
SECTION 10.14 Execution in Counterparts. This Agreement
may be executed in any number of counterparts and by different
parties hereto in separate counterparts, each of which when so
executed shall be deemed to be an original and all of which taken
together shall constitute but one and the same agreement. This
Agreement shall be deemed to be fully executed upon the receipt by
the Agent of executed counterparts (original or facsimile) from
each of the parties hereto.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed by their respective officers or agents
thereunto duly authorized, as of the date first above written.
HEALTH CARE REIT, INC.
___________________________________
By: ________________________________
Title: _____________________________
Address for Notices:
Health Care REIT, Inc.
One SeaGate, Suite 1950
Toledo, Ohio 43603
Telecopy Number: (419) 247-2826
NATIONAL CITY BANK, as Agent
_______________________________
By: Terri R. Cable
Title: Assistant Vice President
Address for Notices:
National City Bank
National City Center
1900 East Ninth Street
Metro Division
Cleveland, Ohio 44114
Telecopy: (216) 575-9396
Lending Office for all Loans:
National City Bank
National City Center
1900 East Ninth Street
Metro Division
Cleveland, Ohio 44114
Payment Office:
National City Bank
National City Center
1900 East Ninth Street
Metro Division
Cleveland, Ohio 44114
BANKS
NATIONAL CITY BANK
__________________________________
By: Terri R. Cable
Title: Assistant Vice President
Address for Notices:
National City Bank
National City Center
1900 East Ninth Street
Cleveland, Ohio 44114
Attention: Metro Division
Telecopy: (216) 575-9396
Lending Office:
National City Bank
National City Center
1900 East Ninth Street
Metro Division
Cleveland, Ohio 44114
BANK ONE, N.A., Dayton
__________________________________
By:
Title: ___________________________
Address for Notices:
Bank One, Dayton, N.A.
Kettering Tower
40 North Main
Commercial Lending, 3rd floor
Dayton, Ohio 45423
Attention: _______________________
Telecopy: _______________________
Lending Office for Loans:
Bank One, Dayton, N.A.
Kettering Tower
40 North Main
Commercial Lending, 3rd floor
Dayton, Ohio 45423
COMERICA BANK
__________________________________
By:
Title: ___________________________
Address for Notices:
Comerica Bank
One Detroit Center
500 Woodward Avenue
Detroit, Michigan 48226
Attention: _______________________
Telecopy: _______________________
Lending Office:
Comerica Bank
One Detroit Center
500 Woodward Avenue
Detroit, Michigan 48226
THE DAIWA BANK, LIMITED
__________________________________
By:
Title: ___________________________
__________________________________
By:
Title: ___________________________
Address for Notices:
The Daiwa Bank, Limited
2450 CNG Tower
625 Liberty Avenue
Pittsburgh, Pennsylvania 15222
Attention: Branch Manager
Telecopy: _______________________
Lending Office:
The Daiwa Bank Limited
233 South Wacker Drive
Suite 5400
Chicago, Illinois 60606
HARRIS TRUST AND SAVINGS BANK
__________________________________
By:
Title: ___________________________
Address for Notices:
Harris Trust and Savings Bank
111 West Monroe
Chicago, Illinois 60690
Attention: Lori Reilly (or Arlett
Hall for Credit Requests)
Telecopy: (312) 461-2591
Lending Office:
Harris Trust and Saving Bank
111 West Monroe
Chicago, Illinois 60690
MANUFACTURERS AND TRADERS TRUST COMPANY
_________________________________
By:
Title: __________________________
Address for Notices:
Manufacturers and Traders Trust Company
One Fountain Plaza
Buffalo, New York 14203
Attention: ____________________________
Telecopy: ____________________________
Lending Office:
Manufacturers and Traders Trust Co.
One Fountain Plaza
Buffalo, New York 14203
SOCIETY NATIONAL BANK
__________________________________
By:
Title: ___________________________
Address for Notices:
Society National Bank
Three SeaGate
Commercial Lending, Floor 2
Toledo, Ohio 43603
Attention: _______________________
Telecopy: _______________________
Lending Office:
Society National Bank
Three SeaGate
Commercial Lending, Floor 2
Toledo, Ohio 43603
NBD BANK, N.A.
__________________________________
By:
Title: ___________________________
Address for Notices:
NBD Bank, N.A.
Midwest Banking Division
611 Woodward
Detroit, Michigan 48226
Attention: _______________________
Telecopy: _______________________
Lending Office:
NBD Bank, N.A.
Midwest Banking Division
611 Woodward
Detroit, Michigan 48226
SCHEDULE I
NAME OF BANK COMMITMENT
National City Bank $35,000,000
Society National Bank $20,000,000
The Daiwa Bank, Limited $20,000,000
Bank One, Dayton, N.A. $25,000,000
Manufacturers and Traders
Trust Company $15,000,000
Harris Trust and Savings Bank $15,000,000
NBD Bank, N.A. $10,000,000
Comerica Bank $10,000,000
EXHIBIT A
FORM OF REVOLVING CREDIT NOTE
Dated: __________, 19___
$________________________
FOR VALUE RECEIVED, the undersigned, HEALTH CARE REIT, INC., a
Delaware corporation (the "Borrower"), hereby promises to pay to
the order of __________________ (the "Bank"), in immediately
available funds on the Revolving Credit Termination Date, the
lesser of ___________________ Million Dollars ($________________)
or the aggregate outstanding principal amount of the Revolving
Credit Loans made by the Bank to the Borrower pursuant to the
Credit Agreement. Each capitalized term used herein and not
otherwise defined herein shall have the meaning ascribed to such
term in that certain Amended and Restated Credit Agreement, dated
as of September 8, 1994 (as the same may from time to time be
amended, supplemented, restated or otherwise modified, the "Credit
Agreement"), among the Borrower, the Bank and certain other banks
parties thereto, and National City Bank, as Agent for the Bank and
such other banks.
The Borrower promises to pay interest on the unpaid principal
amount of each Revolving Credit Loan evidenced hereby from the date
of such Revolving Credit Loan until such principal amount is paid
in full, at such interest rates, and payable at such times, as are
specified in the Credit Agreement. The Borrower promises to pay on
demand, interest on any overdue principal and, to the extent
permitted by law, overdue interest from their due dates at the rate
or rates provided in the Credit Agreement.
Both principal and interest in respect of each Revolving Credit
Loan are payable in lawful money of the United States of America to
the Agent at the Payment Office of the Agent, in same day funds.
Each Revolving Credit Loan made by the Bank to the Borrower
pursuant to the Credit Agreement, and all payments made on account
of the principal amount thereof, shall be recorded by the Bank and,
prior to any transfer hereof, endorsed on the grid attached hereto
which is a part of this Revolving Credit Note; provided, however,
that the failure of the holder hereof to make such a notation or
any error in such a notation shall not affect the obligations of
the Borrower under this Revolving Credit Note.
This Revolving Credit Note is one of the Notes referred to in, and
is entitled to the benefits of, the Credit Agreement. The Credit
Agreement, among other things, (i) provides for the making of
Revolving Credit Loans by the Bank to the Borrower from time to
time in an aggregate amount not to exceed at any time outstanding
the Bank's Revolving Credit Commitment, the indebtedness of the
Borrower resulting from each such Revolving Credit Loan being
evidenced by this Revolving Credit Note, (ii) contains provisions
for acceleration of the maturity hereof upon the happening of
certain stated events and also for prepayments on account of
principal hereof prior to the maturity hereof and (iii) provides
for the amendment or waiver of certain terms of the Credit
Agreement, all upon the terms and conditions therein specified.
The Borrower hereby waives diligence, presentment, demand, protest
and notice of any kind whatsoever. The nonexercise by the holder
of any of its rights hereunder in any particular instance shall not
constitute a waiver thereof in that or any subsequent instance.
This Revolving Credit Note shall be governed by, and construed in
accordance with, the laws of the State of Ohio.
HEALTH CARE REIT, INC.
By:
Title:
<PAGE>
ADVANCES AND PAYMENTS OF PRINCIPAL
HEALTH CARE REIT, INC.
AMENDED AND RESTATED CREDIT AGREEMENT,
DATED AS OF SEPTEMBER 8, 1994
Date of Principal Principal Amount
Loan $ Amount Date Paid Amount Paid Outstanding Noted By
EXHIBIT B
FORM OF CREDIT REQUEST
To: National City Bank, as Agent
Subject: Amended and Restated Credit Agreement, dated as of
September 8, 1994 (the "Credit Agreement"), among Health
Care REIT, Inc. ( Borrower), the Banks which are a party
thereto and National City Bank, as Agent.
Greetings:
Each term in this Credit Request shall be defined in
accordance with the Credit Agreement. Pursuant to the Credit
Agreement, we request
( ) the Banks to grant us a Revolving Credit Borrowing
consisting of a series of Prime Rate Loans in the aggregate
principal sum of $___________________ to be made available on the
____ day of ______________, 19___
( ) the Banks to grant us a Revolving Credit Borrowing
consisting of a series of LIBOR Rate Loans in the aggregate
principal sum of $___________________, each with an initial
Interest Period of _________ month(s), to be made available on the
____ day of ______________, 19___.*
and, in the case of any such requested Revolving Credit Borrowing,
to disburse the proceeds as follows: ____________________________
__________________________________________________________________
__________________________________________________________________
The undersigned hereby certifies that the following statements
are true on the date hereof, and will be true on the date of the
Revolving Credit Borrowing, before and after giving effect thereto
and to the application of the proceeds therefrom:
(i) The representations and warranties contained in Article
IV are correct on and as of the date of this Credit Request and
will be true on and as of the date of the Revolving Credit
Borrowing referenced herein after giving effect to such Revolving
Credit Borrowing, and to the application of the proceeds therefrom,
and
(ii) No event has occurred and is continuing, or would result
from such Revolving Credit Borrowing or from the application of the
proceeds therefrom which constitutes a Default or an Event of
Default, and
(iii) Each existing Subsidiary of the Borrower has delivered
to the Agent (i) a Guaranty Agreement, duly executed by an
authorized officer of such Subsidiary, (ii) a certificate in the
form of Exhibit G-2, (iii) certified copies of its organizational
documents and (iv) an opinion of counsel to such Subsidiary as to
the matters set forth in Section 3.01(g)(ii), and
(iv) The proceeds of such Revolving Credit Borrowing will be
used for the purposes specified in Section 2.01(b) of the Credit
Agreement, and
(v) There has been no event which has resulted or would, more
likely than not, result in a Material Adverse Effect.
The undersigned further certifies that attached hereto is a
Borrowing Base Report, dated as of the date hereof, which report is
true and correct as of the date hereof.
Very truly yours,
HEALTH CARE REIT, INC.
By:
Its:
- - - -------------------
* In the event that the Borrower desires to request more than one
LIBOR Rate Borrowing (having a different Interest Period) on the
same day the Borrower may deliver more than one Credit Request
(subject to the limitations of 2.02(b)).
EXHIBIT C
FORM OF RATE CONVERSION/CONTINUATION REQUEST
To: National City Bank, as Agent
Subject: Amended and Restated Credit Agreement, dated as of
September 8, 1994 (the "Credit Agreement), among Health
Care REIT, Inc. ("Borrower"), the Banks which are a party
thereto and National City Bank, as Agent.
Greetings:
Each term in this Rate Conversion/Continuation Request shall be
defined in accordance with the Credit Agreement. Pursuant to the
Credit Agreement, we request
( ) the Banks to convert $_________________ principal amount
of the [Prime Rate Loans] [LIBOR Rate Loans] comprising the
Revolving Credit Borrowing (or portion thereof) [extended]
[converted] [continued] on _____________, 199_ in the original
aggregate principal sum of [$___________________], on
_________________, 199_, into [LIBOR Rate Loans to have an Interest
Period of ___ months from the date thereof] [Prime Rate Loans].
( ) the Banks to continue $_________________ principal
amount of the LIBOR Rate Loans comprising the Revolving Credit
Borrowing (or portion thereof) [extended] [converted] [continued]
on _____________, 199_ with a ___ month Interest Period in the
original aggregate principal sum of [$___________________] as LIBOR
Rate Loans having an Interest Period of the same duration
commencing on _________________, 199_.*
( ) the Banks to convert $___________________ principal
amount of the LIBOR Rate Loans comprising the Revolving Credit
Borrowing (or portion thereof [extended] [converted] [continued] on
_____________, 199_ with a ___ month Interest Period in the
original aggregate principal sum of [$___________________] to LIBOR
Rate Loans having an Interest Period of ___ months commencing on
_________________, 199_.
The undersigned represents and warrants that this request is
made in compliance with Section 2.02 of the Credit Agreement.
The undersigned hereby certifies that the following statements
are true on the date hereof, and will be true on the date of the
requested Rate Conversion or Rate Continuation before and after
giving effect thereto and to the application of the proceeds
therefrom:
(i) The representations and warranties contained in Article
IV are correct on and as of the date of this Rate Conversion or
Rate Continuation Request and will be true and correct after giving
effect to such Rate Conversion or Rate Continuation, as the case
may be, and to the application of the proceeds therefrom, as of the
date of this request, and
(ii) No event has occurred and is continuing, or would result
from such Rate Continuation or Rate Conversion, as the case may be,
which constitutes a Default or an Event of Default, and
(iii) Each existing Subsidiary of the Borrower has delivered
to the Agent (i) a Guaranty Agreement, duly executed by an
authorized officer of such Subsidiary, (ii) a certificate in the
form of Exhibit G-2, (iii) certified copies of its organizational
documents and (iv) an opinion of counsel to such Subsidiary as to
the matters set forth in Section 3.01(g)(ii), and
(iv) There has been no event which has resulted or would,
more likely than not, result in a Material Adverse Effect.
Very truly yours,
HEALTH CARE REIT, INC.
By:
Its:
- - - -----------------------
* In the event that the Borrower desires to request more than one
LIBOR Rate Borrowing (having a different Interest Period) on the
same day the Borrower may deliver more than one Credit Request
(subject to the limitations of 2.02(b)).
EXHIBIT D
FORM OF REDUCTION NOTICE
Cleveland, Ohio
______________, 19___
To: National City Bank, as Agent
Subject: Reduction of Revolving Credit Commitments under the
Amended and Restated Credit Agreement, dated as of
September 8, 1994 (the "Credit Agreement"), among Health
Care REIT, Inc. ("Borrower"), the Banks which are a party
thereto and National City Bank, as Agent
Greetings:
Reference is made to the Credit Agreement, which provides for,
among other things, Revolving Credit Commitments aggregating
$150,000,000 (as the same may be reduced pursuant to Section 2.03
of the Credit Agreement) available to the Borrower, upon certain
terms and conditions, on a revolving credit basis. Each of the
capitalized terms used herein and not otherwise defined herein
shall have the meanings ascribed to such terms in the Credit
Agreement.
The Borrower hereby requests that the aggregate Revolving Credit
Commitments of the Banks be reduced by _____________ Million
Dollars ($___________________________) [at least $5,000,000 and
multiples of $1,000,000 in excess thereof] (the "Reduction Amount")
effective ___________, 199_. After such reduction the aggregate
Revolving Credit Commitments will be $_______________________.
The undersigned represents and warrants that this Notice is made in
compliance with the provisions of Section 2.03 of the Credit
Agreement and that any payments required by such Section accompany
this Notice or are being transferred simultaneously herewith in
same day funds.
The Credit Agreement shall be amended to reflect such reduction and
each Bank's Revolving Credit Commitment (as set forth on Schedule
I to the Credit Agreement) shall be amended to reflect such Bank's
Ratable Portion of such reduction.
In all other respects the Credit Agreement shall remain in full
effect.
HEALTH CARE REIT, INC.
By:
Its:
Acknowledged:
NATIONAL CITY BANK, as Agent
By:
Its:
EXHIBIT E
FORM OF ADDITION/REMOVAL OF COLLATERAL
Cleveland, Ohio
______________, 19___
To: National City Bank, as Agent [and each of the Banks] 1
Subject: Addition or Removal of Collateral securing the Amended
and Restated Credit Agreement, dated as of September 8,
1994 (the "Credit Agreement"), among Health Care REIT,
Inc. ("Borrower"), the Banks which are a party thereto
and National City Bank, as Agent
Greetings:
Reference is made to the Credit Agreement, which provides for,
among other things, (i) that the Borrower may add Operator Loans or
Operator Leases as Collateral pursuant to Section 2.08(a) or
2.09(b) or request the release of specific Collateral pursuant to
Section 2.08(b), upon certain terms and conditions. Each of the
capitalized terms used herein and not otherwise defined herein
shall have the meanings ascribed to such terms in the Credit
Agreement.
Addition of Eligible Operator Loan or Eligible Operator Lease
Pursuant to Section 2.08(a), the Borrower is adding the [Operator
Loan][Operator Lease] evidenced by the documents attached hereto
and delivered pursuant to Section 3.03[(b)][(a)] as an [Eligible
Operator Loan][Eligible Operator Lease] ]. The Operator in respect
of such [Eligible Operator Loan][Eligible Operator Lease] is
______________________________, and the Health Care Facility
operated by such Operator is _____________________________________,
located at _____________________________________________________.
The Borrower represents and warrants that such [Operator Loan]
[Operator Lease] is an Eligible [Operator Loan][Operator Lease]
pursuant to the terms of the Credit Agreement and that the
documents transmitted herewith include all documents required to be
delivered pursuant to Section 3.03[(b)][(a)] of the Credit
Agreement.] 2
Request for Addition of Operator Loan or Operator Lease
Pursuant to Section 2.09(a), the Borrower is requesting that the
[Operator Loan][Operator Lease] evidenced by the documents attached
hereto and delivered pursuant to Section 3.03[(b)][(a)] be added as
a Borrowing Base Asset notwithstanding the failure of such
[Operator Loan][Operator Lease] to be an [Eligible Operator Loan]
[Eligible Operator Lease] as defined by the Credit Agreement for
the reasons specified in the certificate attached hereto and
delivered pursuant to Section 2.09(a)(ii). The Operator in respect
of such [Eligible Operator Loan][Eligible Operator Lease] is
______________________________, and the Health Care Facility
operated by such Operator is _____________________________________,
located at _______________________________________________________.
The Borrower represents and warrants that, except as set forth in
the certificate attached hereto and delivered in accordance with
Section 2.09(a)(ii), such [Operator Loan][Operator Lease] is an
Eligible [Operator Loan][Operator Lease] pursuant to the terms of
the Credit Agreement and that the documents transmitted herewith
include all documents required to be delivered pursuant to Section
3.03[(a)][(b)] of the Credit Agreement.] 3
Removal of Borrowing Base Asset
Pursuant to Section 2.08(b), the Borrower is removing the [Operator
Loan][Operator Lease] evidenced by the release documents attached
hereto and delivered pursuant to Section 2.08(b) as a Borrowing
Base Asset. The Operator in respect of such [Eligible Operator
Loan][Eligible Operator Lease] is ______________________________,
and the Health Care Facility operated by such Operator is
________________________________, located at ____________________
_____________________________________________________________. The
Borrower represents and warrants that such [Operator Loan][Operator
Lease] is being released pursuant to and in compliance with the
provisions of Section 2.08(b).] 4
HEALTH CARE REIT, INC.
By:
Its:
- - - -------------------------
1. Borrower shall deliver this notice and all documents
accompanying such notice to the Agent unless otherwise specified.
2. Borrower to deliver all documents and certificates required by
Section 3.03(b) or (a), as the case may be, to the Agent.
3. Borrower to deliver all documents and certificates required by
Section 3.03(b) or (a), as the case may be, to the Agent and each
of the Banks.
4. Borrower to deliver all documents and certificates required by
Section 2.08(b) to the Agent.
EXECUTION COPY
EXHIBIT H-1
[AMENDED AND RESTATED] OPEN-END MORTGAGE, ASSIGNMENT
OF RENTS AND SECURITY AGREEMENT
[OHIO FORM]
Effective Date: _____________, 1994
Total Indebtedness (Exclusive of Interest Thereon)
Not To Exceed: $150,000,000
Maturity Date: _____________________, 1996
Mortgagor: Health Care REIT, Inc.
Mortgagor's Notice Address: One SeaGate, Suite 1950
Toledo, Ohio 43604
Attention: Ms. Erin C. Ibele
Agent: National City Bank
Agent's Notice Address: National City Center
1900 East Ninth Street
Cleveland, Ohio 44114
Attention: Metro Ohio Division
Fee Owner: Health Care REIT, Inc.
One SeaGate, Suite 1950
Toledo, Ohio 43604
Premises Address: __________________________________
__________________________________
______________________ County
This Instrument Prepared By and
After Recording Return To: CALFEE, HALTER & GRISWOLD
Suite 1800
800 Superior Avenue
Cleveland, Ohio 44114-2688
<PAGE>
TABLE OF CONTENTS
Section Page
ARTICLE 1 - GRANTING CLAUSES . . . . . . . . . . . . . . . . 2
ARTICLE 2 - OBLIGATIONS SECURED . . . . . . . . . . . . . . 3
2.1 Security for Indebtedness . . . . . . . . . . . . 3
2.2 Security for Future Advances . . . . . . . . . . 3
ARTICLE 3 - REPRESENTATIONS AND WARRANTIES . . . . . . . . . 3
3.1 Existence . . . . . . . . . . . . . . . . . . . . 3
3.3 Enforceability . . . . . . . . . . . . . . . . . 4
3.4 Litigation; Proceedings . . . . . . . . . . . . . 4
3.5 Taxes . . . . . . . . . . . . . . . . . . . . . . 4
3.6 Compliance with Laws . . . . . . . . . . . . . . 4
3.7 ERISA . . . . . . . . . . . . . . . . . . . . . . 4
3.8 Adverse Obligations; Labor Disputes . . . . . . . 5
3.9 Insurance . . . . . . . . . . . . . . . . . . . . 5
3.10 Solvency . . . . . . . . . . . . . . . . . . . . 5
3.11 Investment Company Act Status . . . . . . . . . . 5
3.12 Construction and Completion of Improvements . . . 5
3.13 Title to the Premises . . . . . . . . . . . . . . 5
3.14 Independence of Premises . . . . . . . . . . . . 5
3.15 Business Purpose . . . . . . . . . . . . . . . . 6
3.16 Full Disclosure . . . . . . . . . . . . . . . . . 6
ARTICLE 4 - COVENANTS AND AGREEMENTS . . . . . . . . . . . . 6
4.1 Payment of Indebtedness . . . . . . . . . . . . . 6
4.2 Payment of Taxes . . . . . . . . . . . . . . . . 6
4.3 Insurance . . . . . . . . . . . . . . . . . . . . 7
4.4 Escrow Account for Taxes and Insurance . . . . . 8
4.5 Changes in Law Regarding Taxes . . . . . . . . . 8
4.6 Liens . . . . . . . . . . . . . . . . . . . . . . 9
4.7 Transfers and Encumbrances . . . . . . . . . . . 9
4.8 Waste . . . . . . . . . . . . . . . . . . . . . . 9
4.9 Compliance with Laws and Private Restrictions . . 9
4.10 Maintenance and Alterations . . . . . . . . . . . 10
4.11 Management of the Premises . . . . . . . . . . . 10
4.12 Performance of Prior Covenants . . . . . . . . . 10
4.13 Compliance with Material Contracts; No Amendment
or Default of Material Contracts . . . . . . . . 10
4.14 Visitation . . . . . . . . . . . . . . . . . . . 11
4.15 Estoppel Certificates . . . . . . . . . . . . . . 11
4.16 Indemnification . . . . . . . . . . . . . . . . . 11
4.17 Notice Limiting Amount Secured . . . . . . . . . 11
ARTICLE 5 - CASUALTY LOSSES AND EMINENT DOMAIN . . . . . . . 12
5.1 Casualty Loss and Application of Insurance
Proceeds . . . . . . . . . . . . . . . . . . . . 12
5.2 Takings . . . . . . . . . . . . . . . . . . . . . 13
5.3 Distribution of Taking Proceeds and Insurance
Proceeds . . . . . . . . . . . . . . . . . . . . 14
ARTICLE 6 - ENVIRONMENTAL COMPLIANCE . . . . . . . . . . . . 14
6.1 Definitions . . . . . . . . . . . . . . . . . . . 14
6.2 Environmental Representations and Covenants . . . 15
6.3 Right of Entry . . . . . . . . . . . . . . . . . 17
6.4 Obligations of the Agent and the Banks . . . . . 17
6.5 Indemnification Provisions . . . . . . . . . . . 17
ARTICLE 7 - SECURITY AGREEMENT . . . . . . . . . . . . . . . 17
ARTICLE 8 - DEFAULTS AND REMEDIES . . . . . . . . . . . . . 19
8.1 Default . . . . . . . . . . . . . . . . . . . . . 19
8.2 Acceleration of Maturity; Remedies . . . . . . . 19
8.3 Power of Sale . . . . . . . . . . . . . . . . . . 19
8.4 Performance By the Agent . . . . . . . . . . . . 19
8.5 Appointment of Receiver . . . . . . . . . . . . . 20
8.6 Taking Possession of the Premises . . . . . . . . 20
8.7 Remedies Non-Exclusive . . . . . . . . . . . . . 21
8.8 Execution of Judgment . . . . . . . . . . . . . . 21
8.9 Fees Payable on Foreclosure . . . . . . . . . . . 21
ARTICLE 9 - ASSIGNMENT OF LEASES AND RENTS . . . . . . . . . 21
ARTICLE 10 - GENERAL . . . . . . . . . . . . . . . . . . . . 21
10.1 No Waiver . . . . . . . . . . . . . . . . . . . . 21
10.2 Legal Proceedings . . . . . . . . . . . . . . . . 22
10.3 Subrogation . . . . . . . . . . . . . . . . . . . 22
10.4 Release and Partial Release . . . . . . . . . . . 22
10.5 Subordination . . . . . . . . . . . . . . . . . . 23
10.6 Waiver of Homestead Rights and Appraisement . . . 23
10.7 Covenants to Run with the Land . . . . . . . . . 23
10.8 No Claims Against Agent or the Banks . . . . . . 23
10.9 Further Assurances . . . . . . . . . . . . . . . 23
10.10 Recordation . . . . . . . . . . . . . . . . . . . 24
10.11 Notices . . . . . . . . . . . . . . . . . . . . . 24
10.12 Governing Law . . . . . . . . . . . . . . . . . . 24
10.13 Conflict With Laws . . . . . . . . . . . . . . . 24
10.14 Interest Limitation . . . . . . . . . . . . . . . 24
10.15 Rules of Construction . . . . . . . . . . . . . . 24
10.16 Successors and Assigns; Assignment . . . . . . . 25
10.17 Amendments and Waivers . . . . . . . . . . . . . 25
10.18 Waiver of Jury Trial . . . . . . . . . . . . . . 25
10.19 Jurisdiction; Venue, Inconvenient Forum . . . . . 25
10.20 Certain Defined Terms . . . . . . . . . . . . . . 26
ARTICLE 11 - DEFEASANCE . . . . . . . . . . . . . . . . . . 26
EXHIBITS
Exhibit 1 - Legal Description of Premises
Exhibit 2 - Permitted Encumbrances
INDEX OF CERTAIN DEFINED TERMS
Term Definition
Agent . . . . . . . . . . . . . . . . . . . . . . . . Recitals
Banks . . . . . . . . . . . . . . . . . . . . . . . . Recitals
Borrower . . . . . . . . . . . . . . . . . . . . . . . Preamble
Casualty Loss . . . . . . . . . . . . . . . . . . . . Section 5.1
Code . . . . . . . . . . . . . . . . . . . . . . . . Section 7.1
Collateral . . . . . . . . . . . . . . . . . . . . . Section 3.9
Collateral Documents . . . . . . . . . . . . . . . . . Recitals
Credit Agreement . . . . . . . . . . . . . . . . . . . Recitals
Default Rate . . . . . . . . . . . . . . . . . . . . Section 4.4
Environmental Claims . . . . . . . . . . . . . . . . . Section 6.1
Environmental Laws . . . . . . . . . . . . . . . . . . Section 6.1
Environmental Permits . . . . . . . . . . . . . . . . Section 6.1
Event of Default . . . . . . . . . . . . . . . . . . . Section 8.1
Hazardous Materials . . . . . . . . . . . . . . . . . Section 6.1
Improvements . . . . . . . . . . . . . . . . . . . . . Article 1(b)
Indebtedness . . . . . . . . . . . . . . . . . . . . . Section 2.1
Insurance Proceeds . . . . . . . . . . . . . . . . . . Section 5.1
Indemnitee . . . . . . . . . . . . . . . . . . . . . . Section 6.1
Land . . . . . . . . . . . . . . . . . . . . . . . . . Article 1(a)
Law . . . . . . . . . . . . . . . . . . . . . . . . . Section 3.2
Loan Documents . . . . . . . . . . . . . . . . . . . . Recitals
Mortgage . . . . . . . . . . . . . . . . . . . . . . . Preamble
Mortgagor . . . . . . . . . . . . . . . . . . . . . . Preamble
Net Insurance Proceeds . . . . . . . . . . . . . Section 5.1(b)(ii)
Net Restoration Award . . . . . . . . . . . . . . . . Section 5.2
Notes . . . . . . . . . . . . . . . . . . . . . . . . Recitals
Operator . . . . . . . . . . . . . . . . . . . . . . . Article 1(d)
Operator Lease . . . . . . . . . . . . . . . . . . . . Article 1(d)
Permitted Encumbrances . . . . . . . . . . . . . . . . Section 3.13
Person . . . . . . . . . . . . . . . . . . . . . . . . Section 6.1
Premises . . . . . . . . . . . . . . . . . . . . . . . Article 1
State . . . . . . . . . . . . . . . . . . . . . . . . Article 1(a)
Taking . . . . . . . . . . . . . . . . . . . . . . . . Section 5.2
Taking Proceeds . . . . . . . . . . . . . . . . . . . Section 5.2
Tax . . . . . . . . . . . . . . . . . . . . . . . . . Section 4.2
<PAGE>
[AMENDED AND RESTATED] OPEN-END MORTGAGE, ASSIGNMENT OF RENTS
AND SECURITY AGREEMENT
THIS [AMENDED AND RESTATED] OPEN-END MORTGAGE, ASSIGNMENT
OF RENTS AND SECURITY AGREEMENT (the "Mortgage"), effective as of
the ______ day of ______________, 1994, is made by and between
HEALTH CARE REIT, INC., a Delaware corporation, whose federal
taxpayer identification number is __________, having a mailing
address at One SeaGate, Suite 1950, Toledo, Ohio 43604, Attention:
___________________ (hereinafter referred to as "Mortgagor"), and
NATIONAL CITY BANK, a national banking association, as Agent for
its benefit and the ratable benefit of the Banks (as defined
below), their successors and assigns (together with its successors
and assigns in such capacity, "Agent"), National City Center, 1900
East Ninth Street, Metro Division, Cleveland, Ohio 44114.
RECITALS:
WHEREAS, Mortgagor, as the "Borrower" has entered into
that certain Amended and Restated Credit Agreement dated as of the
effective date hereof (as the same may be supplemented, amended,
restated, modified or substituted from time to time, the "Credit
Agreement"; capitalized terms used herein without definition have
the meanings ascribed to such terms in the Credit Agreement) with
National City Bank and certain other banks as set forth in the
Credit Agreement (such banks and such other banks as may become
parties to the Credit Agreement from time to time, together with
their respective successors and assigns, all being hereinafter
collectively referred to as the "Banks") and Agent as agent for its
benefit and the ratable benefit of the Banks (together with its
successors and assigns in such capacity hereinafter referred to as
"Agent"), pursuant to which the Banks have agreed to loan to the
Mortgagor up to $150,000,000 upon the terms and conditions set
forth therein [which Credit Agreement amends and restates in its
entirety that certain Credit Agreement, dated as of October 1,
1989, by and between the Mortgagor as "Borrower" and National City
Bank as Agent for itself and the other banks (the "Original Banks")
(National City Bank acting in such capacity is hereinafter referred
to as the "Original Agent") which are parties thereto (the
"Original Credit Agreement")];
WHEREAS, to evidence the obligations of the Mortgagor to
the Banks under the Credit Agreement, the Mortgagor has executed
and delivered to the Banks one or more Revolving Credit Notes dated
as of the effective date hereof in the aggregate principal amount
of up to $150,000,000 (the "Notes")[, which Notes replace the notes
executed and delivered by the Mortgagor under the Original Credit
Agreement (the "Original Notes")];
[WHEREAS, the Mortgagor has executed and delivered to the
Original Agent a certain mortgage recorded in Volume ___________,
Page ___________, _________ County Records (the "Original
Mortgage") to secure to the Original Agent the obligations of the
Mortgagor to the Original Agent and the Original Banks under the
Original Credit Agreement and all other instruments and agreements
evidencing or securing such obligations or otherwise related
thereto;]
[WHEREAS, the Original Agent has assigned to Agent the
Original Credit Agreement, the Original Mortgage, and all other
instruments and agreements evidencing or securing the obligations
of the Mortgagor under the Original Credit Agreement or otherwise
related thereto;]
WHEREAS, the Mortgagor has executed and delivered to the
Agent this Mortgage to secure to the Agent the obligations of the
Mortgagor to the Banks under the Credit Agreement, the Collateral
Documents (as defined in the Credit Agreement), and all Related
Writings (as defined in the Credit Agreement) (the Notes, the
Credit Agreement, this Mortgage, the Collateral Documents and the
Related Writings are sometimes collectively referred to herein as
the "Loan Documents")[, which Mortgage amends and restates the
Original Mortgage in its entirety];
NOW, THEREFORE, for good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, and for
the purposes set forth below, the Mortgagor hereby covenants and
agrees as follows:
ARTICLE 1 - GRANTING CLAUSES
The Mortgagor does hereby give, grant, bargain, sell,
grant a security interest in, mortgage, pledge, hypothecate,
assign, and convey unto the Agent, its successors and assigns, all
right, title and interest of the Mortgagor (whether fee, leasehold,
legal, or equitable) in and to the following real and personal
property (hereinafter collectively referred to as the "Premises"):
(a) the real property situated in the City of ____________,
County of ____________, State of ________ (the "State"), described
in Exhibit 1 attached hereto and made a part hereof by reference,
together with all rights and easements now or hereafter created
which are appurtenant thereto (including without limitation all
streets, alleys, passages, water, water courses, riparian rights,
minerals, rights, liberties and privileges thereof, if any) and all
strips and gores and all related tenements and hereditaments, if
any (collectively referred to as the "Land"); and
(b) all buildings and improvements of every kind and
description now or hereafter erected or placed on the Land and all
materials intended for construction, reconstruction, alteration and
repair of such improvements now or hereafter erected thereon
(collectively, the "Improvements"), all of which materials shall be
deemed to be included within the Premises immediately upon the
delivery thereof to the Land, and all fixtures and articles of
personal property now or hereafter owned by the Mortgagor and
attached to, or located on, and used in the construction,
management or operation of the Land or the Improvements, including
but not limited to all furniture, furnishings, apparatus,
machinery, motors, elevators, fittings, radiators, awnings, shades,
blinds, office equipment, carpeting and other furnishings, and all
plumbing, heating, lighting, ventilating, refrigerating,
incinerating, air-conditioning and sprinkler equipment and fixtures
and appurtenances thereto, and all renewals or replacements
thereof, proceeds therefrom, or articles in substitution therefor,
whether or not the same are or shall be attached to the
Improvements in any manner; and
(c) all awards and other compensation heretofore or hereafter
to be made to the present and all subsequent owners of the Premises
for any taking by eminent domain, either permanent or temporary, of
all or any part of the Premises or any easement or appurtenance
thereof, including severance and consequential damage, and change
in grade of streets, which said awards and compensation are hereby
assigned to the Agent; and
(d) all of the Mortgagor's right, title and interest in all
present and future leases, subleases, lettings and licenses of the
Premises including, without limitation, the Lease Agreement between
Mortgagor and ___________ (the "Operator"), dated __________ (the
"Operator Lease"), cash or securities (including guaranties,
letters of credit and other credit enhancement instruments or
agreements), deposited thereunder to secure performance by the
Mortgagor's tenants (including, without limitation, the Operator)
of their obligations thereunder, whether such cash or securities
are to be held until the expiration of the terms of such leases or
applied to one or more of the expiration of such terms, as well as
in and to all judgments, awards of damages and other proceeds
relating to rent, tenancies, subtenancies and occupancies of the
land, Improvements and personalty, and in and to present and future
remainders, rents, issues and profits thereof; and
(e) all of the Mortgagor's interest in and to all unearned
premiums accrued, accruing or to accrue under any and all insurance
policies now or hereafter obtained by the Mortgagor insuring all or
any portion of the Premises and in and to any and all proceeds
payable under any one or more of said policies; and
(f) all of the Mortgagor's interest in all rents, issues,
proceeds, income, revenue and profits of or accruing from any of
the foregoing and any renewals, replacements, substitutions,
extensions, improvements, betterments, appurtenances and additions
to the Improvements or personalty made or acquired by the Mortgagor
after the date hereof and all licenses, permits and other like
rights or interests now or hereafter held or acquired by the
Mortgagor and necessary or useful for the operation of the
Premises.
TO HAVE AND TO HOLD all and singular the Premises,
whether now owned, held or hereafter acquired by the Mortgagor,
unto the Agent, its successors and assigns, forever.
ARTICLE 2 - OBLIGATIONS SECURED
2.1 Security for Indebtedness. The Mortgagor has executed and
delivered this Mortgage for the purpose of securing the performance
of the covenants and agreements contained herein and in any
agreement made with respect to the obligations hereby secured, and
to secure the payment when due, but not necessarily in the order
set forth, of:
(a) any and all sums advanced, readvanced or loaned to, or to
be advanced, readvanced or loaned to, the Mortgagor pursuant to,
and all other obligations and liabilities of the Mortgagor arising
under or in connection with the Credit Agreement, together with
interest thereon at the rate or rates in effect from time to time
as provided in the Credit Agreement;
(b) all sums expended or advanced by the Agent or any of the
Banks pursuant to any term or provision of this Mortgage or any of
the other Collateral Documents in accordance with the Credit
Agreement;
(c) all advances or disbursements of the Agent with respect
to the Premises pursuant to Section 8.4 of this Mortgage for the
payment of taxes, levies, assessments, insurance premiums or costs
incurred in the protection of the Premises as provided in Section
5301.233, Ohio Revised Code; and
(d) the unpaid balances of any loan advances and all other
liabilities and indebtedness of the Mortgagor under the Credit
Agreement to the extent that the total unpaid indebtedness secured
hereby, exclusive of the interest thereon, does not exceed One
Hundred Fifty Million Dollars ($150,000,000);
(all of such debts, liabilities and obligations being collectively
referred to herein as the "Indebtedness"), and as security for the
payment of the Indebtedness the Mortgagor has granted to the Agent
a lien against the Premises.
2.2 Security for Future Advances. This Mortgage is given for the
purpose of creating a lien on the Premises and expressly is to
secure not only the existing Indebtedness but also (i) all
extensions, renewals, modifications or reamortizations of the
Indebtedness, all increases or additions to the Indebtedness, all
loans and future advances and readvances made by the Agent or any
of the Banks to the Mortgagor and all other debts, obligations and
liabilities of every kind and character of the Mortgagor now or
hereafter existing in favor of the Agent and the Banks whether such
debts, obligations or liabilities be direct or indirect, primary or
secondary, joint or several, fixed or contingent, and whether
originally payable to the Agent or any of the Banks or to a third
party and subsequently acquired by the Agent or any of the Banks
and (ii) future advances or readvances, whether such advances or
readvances are obligatory or to be made at the option of the Banks
or otherwise, to the same extent as if such future advances or
readvances were made, whether under the Credit Agreement, the Loan
Documents, or otherwise, on the date of the execution of this
Mortgage, and creates such a lien for all advances and readvances
regardless of who is the owner of the Premises at the time such
advances and readvances are made. The total amount of the
Indebtedness may decrease or increase from time to time and the
Banks may or shall, as required and obligated by the Credit
Agreement, at any time after this Mortgage is delivered for record
to the Office of the County Recorder where the Premises are
situated, make future advances and readvances to the Mortgagor;
however, the total unpaid balance secured at any one time shall not
exceed $150,000,000 plus interest thereon computed in accordance
with the Credit Agreement and any disbursement made for the payment
of taxes, levies or insurance on the Premises with interest on such
disbursements computed in accordance with the Credit Agreement.
Any such future advances and readvances, with interest, shall be
secured by this Mortgage and shall be evidenced by the Credit
Agreement and the Loan Documents.
ARTICLE 3 - REPRESENTATIONS AND WARRANTIES
The Mortgagor represents and warrants as follows:
3.1 Existence. The Mortgagor is duly organized, validly existing
and in good standing under the laws of the state of its
incorporation. The Supplemental Schedule (as defined in the Credit
Agreement) sets forth the name and address of the Mortgagor as of
the Closing Date, the chief executive office of the Mortgagor and
the jurisdiction in which the Mortgagor is incorporated. All of
the outstanding stock of each Subsidiary (as defined in the Credit
Agreement) of the Mortgagor is owned by the Mortgagor and is fully
paid and non-assessable and owned by the Mortgagor free from any
security interest, option, equity or other right of any kind. The
Mortgagor is duly qualified to transact business in each state or
other jurisdiction in which it owns or leases any real property or
in which the nature of the business conducted makes such
qualification necessary or, if not so qualified, such failure to
qualify has neither resulted nor would, more likely than not,
result in a Material Impairment or a Material Adverse Effect (as
such terms are defined in the Credit Agreement).
3.2 Power, Authorization and Consent. The execution, delivery and
performance by the Mortgagor of this Mortgage and of all Related
Writings (as defined in the Credit Agreement) to which it is party
and the creation of all liens and security interests provided for
herein or therein (a) are within the Mortgagor's legal power and
authority, (b) have been duly authorized by all necessary or proper
action of the Mortgagor, (c) do not require the consent or approval
of any governmental body, agency, authority or any other Person (as
defined in the Credit Agreement) which has not been obtained and a
copy thereof furnished to the Agent and (d) will not violate (i)
any provision of any "Law" (which for purposes of this Mortgage
means any federal, state, local or foreign law, ordinance, or
regulation or any order, case precedent, ruling, directive,
judgment, injunction, award or decree or request having the force
of law or any other requirement of any governmental or regulatory
body, court, tribunal or arbitrator) applicable to the Mortgagor,
(ii) any provision of the Mortgagor's certificate or articles of
incorporation or by-laws or regulations, or (iii) any material
agreement or material indenture by which the Mortgagor or the
property of the Mortgagor is bound, except where such violation
specified in this clause (iii) has neither resulted nor would, more
likely than not, result in a Material Impairment or a Material
Adverse Effect (as such terms are defined in the Credit Agreement,
(e) will not result in the creation or imposition of any lien or
encumbrance on any property or assets of the Mortgagor except as
provided herein and in the Credit Agreement, or (f) will not result
in the disqualification of the Mortgage or any Subsidiary of the
Mortgagor as a REIT under Section 856 of the Internal Revenue Code.
3.3 Enforceability. This Mortgage constitutes the legal, valid
and binding obligation of the Mortgagor, enforceable against the
Mortgagor in accordance with its terms subject to any applicable
insolvency or bankruptcy Law of general applicability and general
principles of equity and any limitations imposed by standards of
commercial reasonableness, good faith and fair dealing.
3.4 Litigation; Proceedings. Except as set forth in the
Supplemental Schedule, no action, suit, investigation or proceeding
is now pending or, to the knowledge of the Mortgagor, threatened
against the Mortgagor at law, in equity or otherwise, or with
respect to this Mortgage or any Related Writing to which the
Mortgagor is a party, before any court, board, commission, agency
or instrumentality of any federal, state, local or foreign
government or of any agency or subdivision thereof, or before any
arbitrator or panel of arbitrators which has resulted or would,
more likely than not, result in a Material Adverse Effect.
3.5 Taxes. As of the Closing Date, the Mortgagor and each of its
Subsidiaries has filed all federal, state and local tax returns
which are required to be filed by it and paid all taxes due as
shown thereon, including interest and penalties (except to the
extent, if any, permitted by Section 5.03(a) of the Credit
Agreement).
3.6 Compliance with Laws. Without limiting the representations
made in Section 6.2, neither the Mortgagor, nor any Subsidiary of
the Mortgagor, nor, to the best knowledge of the Mortgagor, the
Operator, is in violation of any Law applicable to the business or
properties of the Mortgagor or any Subsidiary of the Mortgagor,
except for such minor and isolated violations when taken singly or
in the aggregate have neither resulted nor would, more likely than
not, result in a Material Adverse Effect.
3.7 ERISA. The Supplemental Schedule sets forth all of the
Employee Benefit Plans (as defined in the Credit Agreement) of the
Mortgagor and its ERISA Affiliates (as defined in the Credit
Agreement). No Accumulated Funding Deficiency (as defined in the
Credit Agreement) exists in respect of any Employee Benefit Plan of
the Mortgagor or any of its ERISA Affiliates which exceeds One
Hundred Thousand Dollars ($100,000). No Reportable Event (as
defined in the Credit Agreement) has occurred in respect of any
Employee Benefit Plan which is continuing and which (i) constitutes
grounds either for termination of the plan or for court appointment
of a trustee for the administration thereof or (ii) has resulted or
would, more likely than not, result in a Material Adverse Effect.
No "prohibited transaction" (as defined in Section 406 of ERISA or
Section 4975 of the Internal Revenue Code of 1986, as amended) has
occurred that has resulted in or would, more likely than not,
result in, a Material Adverse Effect. None of the Mortgagor or any
of its ERISA Affiliates has (i) had an obligation to contribute to
any Multiemployer Plan, as defined in Section 4001(a)(3) of ERISA,
since 1987 or (ii) incurred or reasonably expects to incur any
liability for the withdrawal from such a Multiemployer Plan which
liability has resulted or would, more likely than not, result in a
Material Adverse Effect.
3.8 Adverse Obligations; Labor Disputes. Except as set forth in
the Supplemental Schedule, the Mortgagor is not subject to any
contract, agreement, corporate restriction, judgment, decree or
order materially and adversely affecting its business, property,
assets, operations or condition, financial or otherwise, is not a
party to any labor dispute (other than grievance disputes which do
not in the aggregate materially and adversely affect any of the
operations, financial condition, or business of the Mortgagor and
its Subsidiaries, if any, on a consolidated basis), and there are
no strikes, slow downs, walkouts or other concerted interruptions
of operations by employees whether or not relating to any labor
contracts which have resulted or would, more likely than not,
result in a Material Adverse Effect.
3.9 Insurance. As of the Closing Date, the insurance coverage of
the Mortgagor consists of those insurance policies disclosed on the
Supplemental Schedule as required by and set forth in Section
5.03(d) to the Credit Agreement and in the Collateral Documents.
3.10 Solvency. The Mortgagor and each of its Subsidiaries is
Solvent (as defined in the Credit Agreement).
3.11 Investment Company Act Status. The Mortgagor is not an
"investment company" or an "affiliated person" of, or "promoter" or
"principal underwriter" for, an "investment company", as such terms
are defined in the Investment Company Act of 1940, as amended (15
U.S.C. Section 80(a)(1), et seq.).
3.12 Construction and Completion of Improvements. All buildings
and Improvements comprising the Premises have been completed and
installed in a good workmanlike manner, in compliance with all
applicable Law, ordinances, building codes and the plans and
specifications except where noncompliance with any of the
foregoing, when taken singly or with all other instances of
noncompliance, has neither resulted nor would, more likely than
not, result in a Material Impairment. The Premises are served by
electric, gas, sewer, water, telephone and other utilities required
for their present and contemplated uses and operation. Any and all
streets, utility lines and offsite improvements, which provide
access to the Premises or are necessary for its present and
contemplated uses, have been completed, are serviceable and have
been accepted or approved by appropriate governmental bodies.
3.13 Title to the Premises. (i) The Mortgagor has good and
marketable fee simple title to the Premises described on Exhibit 1,
free and clear of all liens, security interests, restrictions and
encumbrances except only those listed on Exhibit 2 attached hereto
and made a part hereof by reference (hereinafter collectively
referred to as the "Permitted Encumbrances"), (ii) the Mortgagor
has good and marketable title to each item of personal property
comprising the Premises (hereinafter collectively referred to as
the "Collateral) free and clear of all liens, security interests,
restrictions and encumbrances except only the Permitted
Encumbrances, and (iii) the Mortgagor has good right to bargain,
sell and convey the Premises in manner and form as above written.
The Mortgagor will warrant and defend the Premises with the
appurtenances thereunto belonging to the Agent and the Banks, their
successors and assigns, forever against all lawful claims and
demands whatsoever subject only to the Permitted Encumbrances.
3.14 Independence of Premises. The Mortgagor has not permitted
and shall not permit by act or omission any building or other
improvements on premises not subject to the lien of this Mortgage
to rely on the Premises or any part thereof or any interest therein
to fulfill any municipal or governmental requirement for the
existence of such premises or such building or improvement, and no
building or other improvement on the Premises has relied or shall
rely on any premises not subject to the lien of this Mortgage or
any interest therein to fulfill any governmental or municipal
requirement. Mortgagor shall not by act or omission impair the
integrity of the Premises as one or more separate subdivided zoning
lots separate and apart from all other premises.
3.15 Business Purpose. The Indebtedness is incurred solely for a
business purpose and not a personal, family, household or
agricultural purpose.
3.16 Full Disclosure. No information, exhibits or reports
furnished by the Mortgagor to the Agent or any Bank omits to state
any fact necessary to make the statements contained therein not
materially misleading in light of the circumstances and purposes
for which such information was provided. The Mortgagor has
provided all information requested by the Agent or any Bank and all
such information is complete and accurate in all material respects.
ARTICLE 4 - COVENANTS AND AGREEMENTS
The Mortgagor and its successors and assigns hereby
covenant and agree with the Agent and the Banks, their successors
and assigns, as follows:
4.1 Payment of Indebtedness. The Mortgagor will pay the
Indebtedness according to its tenor and effect when due and owing
and keep and perform all covenants, agreements, conditions and
stipulations thereof.
4.2 Payment of Taxes.
(a) The Mortgagor shall pay or cause to be paid, before any
penalty, interest or cost may be imposed, all real estate taxes,
assessments, levies, water and sewer rents and charges, charges for
public utilities and all other governmental charges, general and
special, ordinary and extraordinary, foreseen and unforeseen, of
any kind and nature whatsoever which at any time during the term of
this Mortgage may be assessed, levied, imposed upon, or grow or
become due and payable out of or in respect of, or become a lien
on, the Premises or any part thereof or any appurtenance thereto or
the Indebtedness or the interest of the Agent and the Banks therein
excepting the federal income tax imposed on the Agent or the Banks
under the laws of the United States (all such taxes, assessments,
levies, water and sewer rents and charges, charges for public
utilities, and other governmental charges being hereinafter
collectively referred to as "Taxes", and any of the same being
hereinafter referred to as a "Tax"); provided, however, that if any
Tax may at the option of the taxpayer be paid in installments
(whether or not interest shall accrue on the unpaid balance of such
Tax), the Mortgagor may exercise the option to pay the same (and
any accrued interest on the unpaid balance of such Tax) in
installments and, in such event, shall pay such installments as the
same respectively become due and before any fine, penalty, further
interest or cost may be added thereto. The Mortgagor shall submit
evidence of the payment of all Taxes to the Agent not less than ten
(10) Business Days after the due date for such payment. The
Mortgagor shall be entitled to the benefit of installment payments
regarding any Tax which is payable in installments, provided,
however, in the event the Mortgagor fails to make any installment
payment when due, the entire amount of such Tax (together with any
accrued interest on the unpaid balance thereof) shall, for the
purposes of this Section 4.2, be deemed due and payable by the
Mortgagor in its entirety on the day a lien would attach to the
Premises.
(b) Notwithstanding the provisions of subsection (a) above,
(i) the Mortgagor shall have the right to contest in good faith any
Tax upon posting with the Agent (or other agent if required under
applicable Law) sufficient security, satisfactory to the Agent, in
its reasonable judgment, for the payment thereof, with interest,
costs and penalties, under written agreement conditioning payment
of such contested Taxes upon determination of such contest, or
prior thereto if the continuance of such contest shall put the
Premises in jeopardy of tax sale or forfeiture; provided, however,
that the Mortgagor shall not be required to post such security so
long as (A) no Event of Default exists, and (B) the posting of such
security is not required to stay enforcement of such Tax and the
Premises are not in jeopardy of tax sale or forfeiture; and (ii) so
long as there exists no Event of Default under this Mortgage, the
Mortgagor shall make all payments of Taxes directly to the
appropriate authorities and without making the payments to the
escrow account contemplated by Section 4.4, but upon the occurrence
of any Event of Default, the provisions of Section 4.4 shall be
automatically applicable and in full force and effect.
4.3 Insurance.
(a) The Mortgagor shall cause the Operator of the Premises to
keep the Improvements on the Premises insured by a policy or
policies of all risk replacement cost insurance (with agreed amount
endorsement) against loss or damage by, or abatement of income
resulting from fire, flood and such other hazards, casualties and
contingencies (including, but not limited to, extended coverage,
vandalism, malicious mischief), in an amount not less than the
greater of (i) the full replacement cost thereof, or (ii) the
amount necessary so that none of the parties hereto shall be deemed
a co-insurer of a loss, and for such length of time as shall be
required by the Agent, which such policy shall be for the benefit
of the Mortgagor and the Agent, as their interests may appear, and
shall provide that no cancellation, reduction in amount, or change
in coverage shall be effective until at least thirty (30) days
after receipt by the Agent of written notice thereof. The
Mortgagor shall cause the Operator of the Premises to maintain
flood insurance, if required pursuant to a designation of the area
in which the Premises are located as flood prone or a flood risk
area, as defined by the Flood Disaster Protection Act of 1973, as
amended, in an amount of not less than the greater of (i) the sum
of the full replacement cost thereof, or (ii) the amount necessary
so that none of the parties hereto shall be deemed a co-insurer of
a loss, as well as comply with any additional requirements of the
National Flood Insurance Program as set forth in said Act. In the
event flood insurance in the required amount is not available,
flood insurance in the maximum amount available shall be obtained.
(b) The Mortgagor shall cause the Operator of the Premises to
maintain for the mutual benefit of the Agent and the Mortgagor
general public liability insurance against claims for personal
injury, death or property damage occurring upon, in or about the
Premises or any elevators therein and on, in or about the adjoining
streets and passageways, such insurance to afford protection to
such limits as the Agent may from time to time request, acting
reasonably. All of such insurance shall be primary and non-
contributing with any insurance policy which may be carried by the
Agent and the Banks.
(c) The Mortgagor shall cause the Operator of the Premises to
maintain all workers' compensation coverage required in connection
with the Premises by the applicable Law of the State.
(d) Absent the prior written consent of the Agent, all such
insurance policies shall be paid in full for periods of not less
than one (l) year in advance. So long as there exists no Event of
Default under this Mortgage, the Mortgagor shall make all payments
of insurance premiums directly and without making the payments to
the escrow account contemplated by Section 4.4, but upon the
occurrence of an Event of Default, the provisions of Section 4.4
shall be automatically applicable and in full force and effect.
(e) All insurance policies shall be issued by an insurer
lawfully doing business in the State and satisfactory to the Agent,
and, to the extent of its interest, are to be for the benefit of
and first payable in case of loss to the Agent as first mortgagee
without contribution. In the event the insurance coverage required
hereunder is provided as part of a blanket policy, then in such
event the amount of the coverage specifically applicable to the
Premises shall be stated on the face of the policy. The Mortgagor
shall place and keep the original policies of insurance required
hereunder with the Agent or, at the Mortgagor's election, a copy
thereof and an original certificate thereof, and shall deliver to
the Agent a new policy (or a copy thereof and an original
certificate thereof) in replacement for any expiring policy, with
evidence of advance premium payments, to the Agent at least thirty
(30) days before the date of such expiration at the Agent's address
as set forth at the beginning of this Mortgage, or at such other
place or to such other party as the Agent may, from time to time,
designate in writing.
(f) The Mortgagor, to the full extent permitted by Law and
without invalidating the insurance with respect to the Premises
required above, shall obtain endorsements by all insurers waiving
any right of subrogation against tenants under any leases with
respect to the Premises and shall require the same of such tenants.
The Agent and the Banks shall not, because of accepting, rejecting,
approving or obtaining insurance, incur any liability for the
existence, nonexistence, form or legal sufficiency thereof, the
solvency of any insurer, or the payment of losses.
(g) Upon foreclosure of this Mortgage, any Event of Default,
or other transfer of title or assignment of the Premises in
discharge, in whole or part, of the Indebtedness, all right, title
and interest of the Mortgagor in and to all policies of insurance,
or portions thereof, required by this Section 4.3 and relating to
the Premises shall inure to the benefit of and pass to the Agent.
4.4 Escrow Account for Taxes and Insurance. Subject to the
provisions of Sections 4.2(b) and 4.3(d) hereof, the Mortgagor will
pay to the Agent in addition to the monthly payments of principal
and interest under the terms of the Indebtedness secured hereby and
concurrently therewith monthly until the Indebtedness is fully
paid, the following sums:
(a) A sum equal to one-twelfth (1/12) of the estimated annual
cost of the Taxes, and one-twelfth (1/12) of the annual insurance
premiums required to keep the buildings, fixtures and equipment of
the Premises insured as required hereunder, which monthly payments
shall be credited to an escrow account, to be held by the Agent
without interest accruing thereon to pay each of the said
particular items. The amount of the estimated monthly payment
under this Section may be adjusted from time to time so that the
amount deposited by the Mortgagor shall approximate the total sum
required annually for payment of all Taxes and insurance premiums
required hereunder. This adjustment shall be made on demand of the
Agent and any deficiencies shall be paid by the Mortgagor within
ten (10) days of the Agent's demand therefor. If funds in the
escrow account are insufficient to pay all Taxes and insurance
premiums and the Mortgagor has failed, refused or neglected to pay
the same as they become due, the Agent may, but shall have no
obligation to, pay the same plus any interest or penalties due
thereon. Any such amount so paid by the Agent shall be added to
the Indebtedness forthwith with interest at the default rate of
interest as set forth in Section 2.06(c) of the Credit Agreement
(the "Default Rate"). No later than ten (10) days prior to the
date when any insurance premium payment or installment of Taxes is
due, without penalty, interest, or delinquency, the Mortgagor shall
present to the Agent the bill for any such premium or installment
of Taxes, and the Agent shall immediately draw a check on the
escrow account, payable to the appropriate insurance provider for
the insurance premiums or the appropriate taxing authority for the
Taxes, for the amount of said premium or installment (to the extent
such funds exist in the escrow account), and shall deliver such
check to the Mortgagor.
(b) Upon receipt of said check by the Mortgagor if such funds
are being escrowed, the Mortgagor shall pay and discharge, as the
same become payable, the insurance premiums and Taxes. The
Mortgagor will submit to the Agent such evidence of the due and
punctual payment of all insurance premiums and Taxes as the Agent
may require. Any deficiency in the fixed amount of any such
aggregate monthly payment not paid by Mortgagor to the Agent within
the grace period, if any, applicable to payments to be made under
the Credit Agreement shall constitute an Event of Default under
this Mortgage. In the event of a sale of the Premises (but without
it being considered a waiver of any rights contained herein), any
such funds then on deposit with the Agent, automatically and
without necessity of further notice or written assignment, shall be
transferred to and held thereafter for the account of the new owner
to be applied in accordance with the foregoing; provided, however,
that in the event any Event of Default has occurred and is
continuing at the time of a sale of the Premises, such funds may be
used by the Agent to satisfy such Event of Default. Any excess
funds then remaining shall be credited to subsequent payments of
Taxes and insurance premiums. If the amount of any such payment
shall exceed the estimate therefor, the Mortgagor shall upon demand
forthwith make good the deficiency. Failure to do so before the
due date of such payment shall be an Event of Default hereunder.
If the Premises are sold under foreclosure or are otherwise
acquired by the Agent after the occurrence of an Event of Default,
any remaining balance of such accumulated funds shall, at the
option of the Agent, be credited upon the Indebtedness as of the
date on which title to the Premises is transferred.
4.5 Changes in Law Regarding Taxes. If at any time the United
States or the State or any of their subdivisions having
jurisdiction shall levy, assess, or charge any Tax (i) upon this
Mortgage, the Indebtedness or the interest of the Agent and the
Banks in the Premises or (ii) upon the Banks by reason of or as
holder of any of the foregoing, then the Indebtedness and the
accrued interest thereon shall be and become due and payable at the
option of the Agent thirty (30) days after the mailing of notice of
such election to the Mortgagor; provided, however, said option
shall not be available if the Mortgagor lawfully may pay for (or
reimburse the Agent and/or any or all of the Banks for) such Tax
including interest and penalties thereon to or for the Agent and
elects to pay and does, in fact, pay when payable, for all such
Tax, including interest and penalties thereon. The Mortgagor
further agrees to deliver to the Agent, at any time, upon demand,
such evidence as may be required by any government agency having
jurisdiction in order to determine whether the Indebtedness hereby
secured is subject to or exempt from any such Tax or any other
governmental filing or reporting requirement.
4.6 Liens. Except as permitted under the Credit Agreement, the
Mortgagor shall keep the Premises free and clear from all
mechanics' liens and statutory liens of every kind other than Taxes
which may be a lien but not yet due and payable. Further, the
Mortgagor will keep and maintain the Premises free from all claims
of all persons supplying labor, materials or services which will
enter into or otherwise contribute to the construction of any and
all buildings and improvements now being erected or which hereafter
may be erected on the Premises, notwithstanding by whom such labor
or materials may have been contracted; provided, however, that the
Mortgagor shall have the right to contest in good faith any such
mechanics' lien or statutory lien upon posting with the Agent, or
such other agent as may be required pursuant to any applicable
statute, sufficient security, satisfactory to the Agent in its
reasonable judgment, for the payment thereof, with interest, costs
and penalties, under written agreement conditioning payment of such
contested mechanics' lien or statutory lien upon determination of
such contest, or prior thereto if the continuance of such contest
or litigation shall put the Premises in jeopardy of foreclosure
sale or forfeiture for such lien.
4.7 Transfers and Encumbrances.
(a) Except as permitted under the Credit Agreement and except
for the Permitted Encumbrances, the Mortgagor shall not sell,
encumber (including without limitation by means of subordinate
mortgage or lien upon the Premises or any part thereof), assign,
lease or dispose of the Premises or any part thereof or interest
thereon, or (ii) enter into any contract or agreement to do
anything prohibited by clause (i) of this Section 4.7, expressly
including without limitation any land contract, lease/purchase,
lease/option or option agreement without, in each such case, first
obtaining the written consent of the Agent. Any such lease or
agreement not actually approved by the Agent shall, at the option
of the Agent, be null and void and shall not grant any rights in
the Premises to the parties named therein. If the Mortgagor (or
any permitted successor-in-interest thereof) is a corporation, then
any merger, consolidation or liquidation shall constitute a sale of
the Premises for the purpose of this Mortgage. If the Mortgagor
(or any permitted successor-in-interest thereof) is a partnership,
then any transfer of ownership of any partnership interests shall
constitute a sale of the Premises for purposes of this Mortgage.
Except as permitted under the Credit Agreement, in the event title
to the Premises or any part thereof or interest therein becomes
vested in a person or persons not approved by the Agent, the
Indebtedness shall become due and payable in full at the option of
the Banks in accordance with the terms of the Credit Agreement. In
the event title to the Premises or any part thereof or interest
therein becomes vested in a person or persons other than the
Mortgagor or the Agent, the Agent may, without notice to the
Mortgagor, deal with such successor- or successors-in-interest with
respect to this Mortgage and the Indebtedness in the same manner as
with the Mortgagor, without in any way releasing, discharging or
otherwise affecting any liability of the Mortgagor under this
Mortgage or for the Indebtedness.
(b) The consent of the Agent required hereunder may be
refused or predicated upon any terms, conditions and covenants
deemed advisable or necessary by the Agent in its sole discretion,
including but not limited to the right to change the interest rate,
date of maturity or payments of principal and/or interest, to
require payment of any amounts as additional consideration as a
transfer fee or otherwise and to require assumption of this
Mortgage and/or one or more Notes. Any lease or sublease of the
Premises or any part thereof or interest therein shall provide for
the attornment by the subtenant thereof and of all subtenants or
estates thereunder to the owner of the Premises after foreclosure
or after a deed in lieu of foreclosure in the event the lease or
sublease would otherwise have been terminated because of
foreclosure.
4.8 Waste. The Mortgagor shall not commit waste upon the Premises
or suffer waste to be committed thereon.
4.9 Compliance with Laws and Private Restrictions. The Mortgagor
will keep the Premises in full compliance with Law applicable to or
affecting the Premises if noncompliance with such Law, when taken
singly or with all other instances of noncompliance, has either
resulted or would, more likely than not, result in a Material
Adverse Effect. The Mortgagor shall observe and comply with all
conditions and requirements necessary to preserve and extend any
and all rights, licenses, permits (including but not limited to
zoning variances, special exceptions and non-conforming uses),
privileges, franchises and concessions which are applicable to the
Premises or which have been granted to or contracted for by the
Mortgagor in connection with any existing or presently contemplated
use of the Premises and shall obtain and keep in full force and
effect all necessary governmental and municipal approvals as may be
necessary from time to time to comply with all environmental,
ecological and other requirements and with any and all conditions
attached to the insurance relating to the Premises and maintenance
thereof, if noncompliance with any of the foregoing, when taken
singly or with all other instances of noncompliance, has either
resulted or would, more likely than not, result in a Material
Adverse Effect.
4.10 Maintenance and Alterations. The Mortgagor shall, or shall
cause the Operator of the Premises to, construct, keep and maintain
and make all necessary and proper replacements to all buildings and
improvements (including fixtures) and all apparatus and personal
property owned by the Mortgagor now or hereafter situated on the
Premises at all times in good working order, condition and repair,
fit and proper for the respective purposes for which they were
erected or installed, ordinary wear and tear excepted, and shall
refrain from wasting or destroying any such necessary assets or any
part thereof and from being negligent in the care or use thereof.
No buildings or substantial improvements on the Premises shall be
materially altered or demolished or removed by the Mortgagor
without the prior written consent of the Agent. The Mortgagor
further covenants and agrees to make no alterations to the
buildings and improvements now or hereafter located on the Premises
that affect or change either the quantity or quality thereof in any
material respect, without the prior written consent of the Agent.
4.11 Management of the Premises. Except as permitted under the
Credit Agreement and except for the Operator Lease, the Mortgagor
shall not enter into any franchise, management, operating or
license agreement regarding the Premises without the Agent's prior
written consent.
4.12 Performance of Prior Covenants. The Mortgagor hereby
acknowledges that the Indebtedness was incurred in good faith for
full value received. The Mortgagor covenants and agrees to make
all payments and perform all conditions and covenants called for in
any prior mortgages, easements, restrictions or other encumbrances
now encumbering the Premises or any part thereof or interest
therein and those called for in any other superior estate of the
Premises prior to the expiration of the cure or grace period
applicable thereto, if any, and in the event of default in any such
payment or payments, conditions or covenants, the Agent, without
waiving the option to declare an Event of Default hereunder, herein
reserves the right to make such payments, or perform such
conditions or covenants. Any and all such sums paid or expenses
incurred on behalf of the Agent, together with interest thereon
from the date of payment at the Default Rate, shall be added to the
Indebtedness and be secured by this Mortgage.
4.13 Compliance with Material Contracts; No Amendment or Default
of Material Contracts.
(a) The Mortgagor shall perform and observe, and cause each
of its Subsidiaries to perform and observe, all the material terms
and provisions of each material contract relating to the Premises
to be performed or observed by it, including, without limitation,
the Operator Lease and all other Operator Lease Documents (as
defined in the Credit Agreement) and maintain each such material
contract in full force and effect, and enforce, to the extent that
the Mortgagor, in its reasonable judgment, determines to be
appropriate, each such material contract in accordance with its
terms if the failure of the Mortgagor to perform, observe or
enforce any one or more of such contracts has neither resulted nor
would, more likely than not, result in a Material Adverse Effect.
The Mortgagor shall not permit any Operator under any Operator Loan
or Operator Lease to remain in material default thereof if such
default has resulted or would, more likely than not, result in a
Material Adverse Effect.
(b) The Mortgagor shall not, and shall not permit any of its
Subsidiaries to take any action to amend, cancel, terminate, waive
any provision of, consent to the noncompliance with any term of any
material contract with respect to the Premises (material contracts
being deemed to include, without limitation, the Operator Lease and
the Operator Lease Documents); provided, however, that the
Mortgagor may take any such action so long as such action (i) does
not relate to a material financial provision of any agreement which
is the subject of the Collateral Assignment of Operator Lease
Documents of even date herewith (the "Collateral Assignment"), (ii)
does not relate to any provision in any agreement which is the
subject of the Collateral Assignment and which provision is
expressly for the benefit of the mortgagee or assignee with respect
thereto, (iii) is taken in the ordinary course of the Mortgagor's
or such Subsidiary's business, (iv) is consistent with the
Mortgagor's past practices, (v) which would not, more likely than
not, result in a Material Adverse Effect, (vi) will not have an
adverse effect on the interest (including the perfection and
priority of any security interest or Lien in favor of the Agent or
the Mortgagor) of the Agent and the Banks in such agreement or the
assets with respect thereto or otherwise result in a Material
Impairment.
4.14 Visitation. The Mortgagor shall permit, and shall cause the
Operator of the Premises to permit, upon receipt of not less than
two Business Days' prior written notice, each of the Banks during
normal business hours: (i) to examine the Premises with the
guidance and supervision of the Mortgagor, and to examine the
Mortgagor's financial records and to make copies of and extracts
from such records; and (ii) to consult with the Mortgagor's
officers, directors, accountants, actuaries, trustees and plan
administrators, as the case may be, in respect of the Mortgagor's
financial condition, properties and operations and the financial
condition of the Mortgagor's Employee Benefit Plans, each of which
parties is hereby authorized to make such information available to
each of the Banks to the same extent that it would to the
Mortgagor; provided, however, that, all information obtained shall
be subject to the provisions of Section 8.03 of the Credit
Agreement.
4.15 Estoppel Certificates. Within ten (10) days after request by
the Agent, the Mortgagor shall furnish the Agent with a statement,
duly acknowledged and certified, setting forth (i) the amount of
the original principal amount of the Indebtedness, (ii) the unpaid
principal amount of the Indebtedness, (iii) the rate of interest of
the Indebtedness, (iv) the date installments of interest and
principal were last paid, (v) any offsets or defenses to the
payment of the Indebtedness, if any, and (vi) that the Indebtedness
and this Mortgage are valid, legal and binding obligations of the
Mortgagor and have not been modified or if modified, giving the
particulars of such modification.
4.16 Indemnification. The Mortgagor hereby indemnifies and agrees
to protect, defend, and save harmless the Agent and the Banks from
and against all liabilities, obligations, claims, damages,
penalties, causes of action, costs, and expenses (including,
without limitation, attorneys' fees and expenses), imposed upon or
incurred by or asserted against the Agent or any of the Banks
(except liabilities, obligations, claims, damages, penalties,
causes of action, costs, and expenses resulting from the Agent's or
a Bank's gross negligence or willful misconduct) by reason of (i)
ownership of this Mortgage, the Premises, or any interest therein
or receipt of any rents; (ii) any alleged obligation or liability
on the part of the Agent to be performed or discharged under the
terms and provisions of any agreements relating to the Premises,
except for such liabilities as the Agent or any of the Banks may
specifically assume thereunder; (iii) any accident, injury to or
death of persons or loss of or damage to property occurring in, on,
or about the Premises or any part thereof or on the adjoining
sidewalks, curbs, adjacent property, or adjacent parking areas,
streets, or ways; (iv) any use, non-use, or condition in, on, or
about the Premises, or any part thereof or on the adjoining
sidewalks, curbs, adjacent property, or adjacent parking areas,
streets or ways; (v) any actions or omissions of the Mortgagor
relating to this Mortgage or the Loan Documents or any failure on
the part of the Mortgagor to perform or comply with any of the
terms of this Mortgage or the Loan Documents; (vi) the performance
of any labor or services or the furnishing of any materials or
other property in respect of the Premises or any part thereof;
(vii) any lease agreement or under or by reason of this Mortgage or
the exercise of rights or remedies hereunder and from any and all
claims and demands whatsoever which may be asserted against the
Agent or any of the Banks by reason of any alleged obligations or
undertakings on its part to perform or discharge any of the terms,
covenants or agreements contained in any such lease agreement; or
(viii) the failure of any person to file timely with the Internal
Revenue Service an accurate Form 1099-B, Statement for Recipients
of Proceeds from Real Estate, Broker and Barter Exchange
Transactions, which may be required in connection with this
Mortgage, or to supply a copy thereof in a timely fashion to the
recipient of the proceeds of the transaction in connection with
which this Mortgage is made. Any amounts payable to the Agent or
any of the Banks by reason of the application of this Section 4.16
shall be secured by this Mortgage and shall become immediately due
and payable and shall bear interest at the rate of interest then
applicable under the Credit Agreement from the date loss or damage
is sustained by the Agent and such of the Banks until paid. The
obligations and liabilities of the Mortgagor under this Section
4.16 shall survive the satisfaction, foreclosure, delivery of a
deed in lieu of foreclosure, execution, termination or cancellation
of the Notes, this Mortgage, the Credit Agreement, the Loan
Documents or any other documents relating thereto for whatever
reason.
4.17 Notice Limiting Amount Secured. The Mortgagor covenants that
it will not, without the prior written consent of the Agent, file
of record any notice limiting the maximum principal amount secured
by this Mortgage.
ARTICLE 5 - CASUALTY LOSSES AND EMINENT DOMAIN
5.1 Casualty Loss and Application of Insurance Proceeds.
(a) Insurance Proceeds. Each of the parties hereto agrees
that all amounts and proceeds (including instruments) in respect of
the proceeds of any casualty insurance policy on the Improvements
(the "Insurance Proceeds"), shall be paid by the respective
insurers directly to the Agent, and if paid to the Mortgagor such
Insurance Proceeds shall be received only in trust for the Agent,
shall be segregated from other funds of the Mortgagor and shall be
forthwith paid over to the Agent in the same form as received (with
any necessary endorsement). Each of the parties hereto agrees, to
the fullest extent that it effectively may do so under applicable
Law, that the Agent shall apply all such Insurance Proceeds in
accordance with the provisions of paragraph (b) of this Section
5.1.
(b) Repairs and Restoration.
(i) In case of any Casualty Loss when paragraph (ii) of
this subsection (b) is not applicable, and so long as no "Event of
Default" as defined in the Operator Lease has occurred and is
continuing under the Operator Lease (hereinafter referred to as a
"Lease Default"), the Mortgagor shall make or cause to be made the
repairs to or replacements of the Premises necessary to repair and
restore the Premises as nearly as possible to the condition the
Premises were in immediately prior to such Casualty Loss promptly
after the Insurance Proceeds are settled, and the Agent shall make
the Insurance Proceeds received by the Agent pursuant to the
provisions of this Mortgage as a result of such Casualty Loss,
after deduction of its reasonable costs and expenses, if any, in
collecting the same (the "Net Insurance Proceeds") available for
the repair and restoration of the Premises, provided that (i) no
Event of Default shall exist under the Loan Documents, and (ii) the
Mortgagor shall have provided to the satisfaction of the Agent (1)
contracts for such repair or replacement demonstrating the
Mortgagor's ability to effect such repair or replacement at a cost
not greater than such Insurance Proceeds (or, if such cost is
greater, accompanied by an explanation of the source of funds for
such excess amounts satisfactory to the Agent), and (2) cash-flow
projections and other assurances reasonably satisfactory to the
Agent providing for the Mortgagor's ability to meet its obligations
under the Loan Documents during the period from such Casualty Loss
until and following completion of such repair or replacement. Upon
satisfaction of the provisions of the preceding sentence of this
paragraph, the Net Insurance Proceeds will be disbursed by the
Agent to the Mortgagor to pay for the costs of repair and
restoration of the Premises. The Net Insurance Proceeds shall be
held by the Agent in a separate interest-bearing account until
expended in connection with the repair and restoration of the
Premises, it being agreed that any Net Insurance Proceeds (together
with any accrued interest thereon) so held by the Agent shall
constitute additional security for the payment of the Indebtedness
secured by this Mortgage. The Net Insurance Proceeds (together
with any accrued interest thereon) shall be paid by the Agent to
the Mortgagor for application of as much as may be necessary for
the payment of the costs of repair, rebuilding or restoration,
either on completion thereof or as the work progresses, as directed
by the Mortgagor, subject to the provisions of the Operator Lease.
As a condition to the disbursement of the Net Insurance Proceeds
(and any accrued interest thereon), the Agent shall be entitled to
receive (1) title continuation from the title company insuring the
Premises evidencing that no mechanics' liens have been filed
against the Premises, (2) a certificate from an engineer selected
by the Agent, certifying that all work in place has been completed
in accordance with the plans and specifications approved by the
Agent and (3) certificates or affidavits from contractors and
materialmen that all sums payable to such contractors and
materialmen to the date of such certificates or affidavits have
been paid. The Agent may, prior to making payment from such
separate award account, require the Mortgagor to provide evidence
that, or deposit with the Agent moneys to be placed in such account
so that, there will be adequate moneys available for such repair
and restoration. The Agent shall not be obligated to make any
payment from such account if there exists an Event or Default
hereunder. Any balance of the Net Insurance Proceeds (together
with any accrued interest thereon) held by the Agent remaining
after payment of all costs of such repair, rebuilding or
restoration shall be applied by the Agent in accordance with
Section 5.3 below.
(ii) If a Lease Default shall have occurred and an Event
of Default shall have occurred and be continuing at the time of a
Casualty Loss, all insurance payments in respect of such portion of
the Premises shall be paid to and applied by the Agent as specified
in Section 5.3 hereof. If there shall have occurred a Casualty
Loss resulting in the actual or constructive total loss of all of
the Premises or more than 50% of the licensed beds at the health
care facility operated by Operator at the Premises under the
Operator Lease, all insurance payments in respect of such portion
of the Premises shall be paid to and applied by the Agent as
specified in Section 5.3 hereof, subject to the terms of the
Operator Lease.
5.2 Takings. If any compulsory transfer or taking or transfer
under threat of compulsory transfer or taking by any agency,
department, authority, commission, board, instrumentality, or
political subdivision of the State or the United States of America
shall be threatened in writing or occur with respect to all or any
portion of the Premises (each such occurrence being hereinafter
referred to as a "Taking"), the Mortgagor shall (i) promptly upon
any such threat of which it is aware or occurrence provide written
notice thereof to the Agent, (ii) diligently pursue all its rights
to compensation against the State or the United States, as the case
may be, or against any agency, department, authority, commission,
board, instrumentality or political subdivision thereof in respect
of such Taking, (iii) not, without the written consent of the
Agent, compromise or settle any claim against the State or the
United States, as the case may be, or against any agency,
department, authority, commission, board, instrumentality or
political subdivision thereof, (iv) hold all amounts and proceeds
(including instruments) received in respect of any Taking ("Taking
Proceeds") in trust for the benefit of the Agent segregated from
other funds of the Mortgagor and (v) forthwith pay over to the
Agent all such amounts and proceeds in the same form as received
(with any necessary endorsement), free and clear of any
encumbrances of any kind or nature whatsoever, to be applied in
accordance with the provisions of this Section or Section 5.3
below, as the case may be. To the extent that participation is
legally available to the Agent, the Agent may participate in any
Taking proceedings, and the Mortgagor shall from time to time use
its best efforts to deliver to the Agent, to the furthest extent
possible, all instruments requested by it to permit such
participation.
Notwithstanding any Taking, the Mortgagor shall continue
to pay all payments at the time and in the manner provided for in
the Loan Documents and the amount outstanding on the Indebtedness
shall not be reduced until any award or payment therefor shall have
been actually received and applied by the Agent to the prepayment
of the Indebtedness under the Credit Agreement. If the Premises
are sold, through foreclosure or otherwise, prior to the receipt by
the Agent of the Taking Proceeds, the Agent shall have the right to
receive such Taking Proceeds or a portion thereof sufficient to
repay the Indebtedness as though the same were being prepaid under
the Credit Agreement, whichever is less. The Mortgagor shall file
and prosecute its claim or claims for any such award or payment in
good faith and with due diligence and cause the same to be
collected and paid over to the Agent, and hereby irrevocably
authorizes and empowers the Agent, in the name of the Mortgagor or
otherwise to collect and receipt for any such award or payment and
to file and prosecute such claim or claims, and although it is
hereby expressly agreed that the same shall not be necessary in any
event, the Mortgagor shall, upon demand of the Agent, make, execute
and deliver any and all assignments and other instruments
sufficient for the purpose of assigning any such award or payment
to the Agent, free and clear of any encumbrances of any kind or
nature whatsoever.
If less than all the Premises are taken, unless in the
reasonable judgment of the Agent such Taking will have a material
adverse effect on the business or financial condition of (i) the
Mortgagor or (ii) the Mortgagor and its Subsidiaries, if any, on a
consolidated basis, the Agent shall make the proportion of the
aggregate award or payment received by the Agent pursuant to the
provisions of this Mortgage as a result of such Taking which is
specifically awarded for the repair and restoration of the portion
of the Premises not taken or in the absence of any such specific
award, is in the sole opinion of the Agent necessary to pay for the
costs which will be incurred in connection with the repair and
restoration of the portion of the Premises not taken after
deduction of its reasonable costs and expenses, if any, in
collecting the same (the "Net Restoration Award") available for the
repair and restoration of the Premises not taken, provided that (i)
no Event of Default shall exist under the Loan Documents, (ii) the
Mortgagor shall proceed with the repair and restoration of the
Premises not taken as nearly as possible to the condition the
Premises not taken were in immediately prior to such Taking
promptly after the award is settled, and (iii) the Agent shall be
satisfied that upon the completion of such repair and restoration
the appraised value of the Premises not taken after such repair and
restoration, will not be materially less than the value immediately
prior to such Taking, as determined by an appraiser selected by the
Agent. Upon satisfaction of the provisions of the preceding
sentence of this paragraph, the Net Restoration Award will be
disbursed by the Agent to the Mortgagor to pay for the costs of
repair and restoration of the Premises not taken. The Net
Restoration Award shall be held by the Agent in a separate
interest-bearing account until expended in connection with the
repair and restoration of the Premises not taken, it being agreed
that any Net Restoration Award (together with any accrued interest
thereon) so held by the Agent shall constitute additional security
for the payment of all sums secured by this Mortgage. The Net
Restoration Award (together with any accrued interest thereon)
shall be paid by the Agent to the Mortgagor for application of as
much as may be necessary for the payment of the costs of repair,
rebuilding or restoration, either on completion thereof or as the
work progresses, as directed by the Mortgagor. As a condition to
the disbursement of the Net Restoration Award (and any accrued
interest thereon), the Agent shall be entitled to receive (i) title
continuation from the title company insuring the Premises
evidencing that no mechanics' liens have been filed against the
Premises, (ii) a certificate from an engineer selected by the
Agent, certifying that all work in place has been completed in
accordance with the plans and specifications approved by the Agent
and (iii) certificates or affidavits from contractors and
materialmen that all sums payable to such contractors and
materialmen to the date of such certificates or affidavits have
been paid. The Agent may, prior to making payment from such
separate award account, require the Mortgagor to provide evidence
that, or deposit with the Agent moneys to be placed in such account
so that, there will be adequate moneys available for such repair
and restoration. The Agent shall not be obligated to make any
payment from such account if there exists an Event of Default
hereunder. Any balance of the Net Restoration Award (together with
any accrued interest thereon) held by the Agent remaining after
payment of all costs of such repair, rebuilding or restoration
shall be applied by the Agent in accordance with Section 5.3 below.
5.3 Distribution of Taking Proceeds and Insurance Proceeds.
Except as otherwise provided in this Article 5, all Taking Proceeds
and Insurance Proceeds with respect to the occurrence of a Casualty
Loss or Taking, as well as all payments or amounts then held or
thereafter received by the Agent under the Loan Documents as
collateral security for the Indebtedness may be applied by the
Agent in any one or more of the following ways:
(a) to the fulfillment of any of the covenants contained
herein as the Agent may determine, including, without limitation,
the replacement or restoration of the Premises to a condition
satisfactory to the Agent, in accordance with this Article 5;
(b) to the payment of all costs incurred in the collection
thereof (including, without limitation, reasonable attorneys' fees
and expenses except as may have been limited by Law or by judicial
order or decision entered in any action to foreclose this
Mortgage);
(c) to the payment of the Indebtedness secured by this
Mortgage owing to the Agent (including any interest or premium
accrued thereon); and/or
(d) to or at the direction of the Mortgagor, unless a court
of competent jurisdiction may otherwise direct by final order not
subject to appeal.
ARTICLE 6 - ENVIRONMENTAL COMPLIANCE
6.1 Definitions. The following definitions apply to the
provisions of this Article:
(a) "Environmental Laws" means any federal, state or local
law, regulation, ordinance, or order pertaining to the protection
of the environment and the health and safety of the public,
including (but not limited to) the Comprehensive Environmental
Response, Compensation and Liability Act ("CERCLA"), 42 USC Sections 9601
et seq.; the Resource Conservation and Recovery Act ("RCRA"), 42
USC Sections 6901 et seq., the Hazardous Materials Transportation Act, 49
USC Sections 1801 et seq., the Federal Water Pollution Control Act (33
USC Sections 1251 et seq.), the Toxic Substances Control Act (15 USC Sections
2601 et seq.) and the Occupational Safety and Health Act (29 USC Sections
651 et seq.), and all similar state, regional or local laws,
treaties, regulations, statutes or ordinances, common law, civil
laws, or any case precedents, rulings, requirements, directives or
requests having the force of law of any foreign or domestic
governmental authority, agency or tribunal, and all foreign
equivalents thereof, as the same have been or hereafter may be
amended, and any and all analogous future laws, treaties,
regulations, statutes or ordinances, common law, civil laws, or any
case precedents, rulings, requirements, directives or requests
having the force of law of any foreign or domestic governmental
authority, agency or tribunal and the regulations promulgated
pursuant thereto, which governs:
(i) the existence, cleanup and/or remedy of
contamination on property;
(ii) the emission or discharge of Hazardous Materials
into the environment;
(iii) the control of hazardous wastes;
(iv) the use, generation, transport, treatment, storage,
disposal, removal or recovery of Hazardous Materials; or
(v) the maintenance and development of wetlands.
(b) "Environmental Claims" means any and all administrative,
regulatory or judicial actions, suits, demands, demand letters,
claims, liens, notices of noncompliance or violation, investiga-
tions, proceedings, consent orders or consent agreements relating
in any way to any Environmental Law or any Environmental Permit
("Claims"), including, without limitation, (a) any and all Claims
by governmental or regulatory authorities for enforcement, cleanup,
removal, response, remedial or other actions or damages pursuant to
any applicable Environmental Law, and (b) any and all Claims by any
third party seeking damages, contribution, indemnification, cost
recovery, compensation or injunctive relief resulting from
Hazardous Materials or arising from alleged injury or threat of
injury to health or the environment.
(c) "Environmental Permits" means all permits, approvals,
notifications, identification numbers, licenses and other
authorizations required under any applicable Environmental Laws.
(d) "Hazardous Material" means and includes (i) any asbestos
or other material composed of or containing asbestos which is, or
may become, even if properly managed, friable; (ii) petroleum and
any petroleum product, including crude oil or any fraction thereof,
and natural gas or synthetic natural gas liquids or mixtures
thereof; (iii) any hazardous, toxic or dangerous waste, substance
or material defined as such in (or for purposes of) CERCLA or RCRA,
any so-called "Superfund" or "Superlien" law, or any other
applicable Environmental Laws, and (iv) any other substance whose
generation, handling, transportation, treatment or disposal is
regulated pursuant to any Environmental Laws.
(e) "Indemnitee" means the Agent and the Banks and all
subsequent holders of the Indebtedness, their respective successors
and assigns, their respective officers, directors, employees,
agents, representatives, contractors and subcontractors and any
subsequent owner of the Premises who acquires title thereto from or
through the Agent.
(f) "Person" means and includes an individual, partnership,
corporation (including a business trust), joint stock company,
trust, unincorporated association, joint venture or other entity,
or a government or any political subdivision or department or
agency thereof.
6.2 Environmental Representations and Covenants. The Mortgagor
represents, warrants, covenants and agrees as follows:
(a) The Premises is in material compliance with Environmental
Laws except where such noncompliance, taken singly or taken
together with all other noncompliance with Environmental Laws, has
neither resulted nor would, more likely than not, result in a
Material Adverse Effect. There is no noncompliance with any
Environmental Law or existence of any environmental condition
which, when taken singly or in the aggregate, has resulted or
would, more likely than not, result in a Material Adverse Effect.
With respect to the Premises (a) there are no pending or threatened
Environmental Claims against the Mortgagor or the Operator or any
other environmental condition with respect to the Premises which,
taken singly or taken together with all pending or threatened
Environmental Claims, has resulted or would, more likely than not,
result in a Material Adverse Effect, (b) the Mortgagor and the
Operator has been issued and is in compliance with all
Environmental Permits except where noncompliance, whether taken
singly or taken together with all other noncompliance with
Environmental Permits, has neither resulted nor would, more likely
than not, result in a Material Adverse Effect, (c) Hazardous
Materials have not been released or disposed of on or from the
Premises or, to the best knowledge of the Mortgagor, on or from any
property adjoining the Premises which, in either case, whether
taken singly or taken together with all other releases or
dispositions of Hazardous Materials, has resulted or would, more
likely than not, result in a Material Adverse Effect. No portion
of the Premises is listed or proposed for listing on the National
Priorities List pursuant to CERCLA, on the CERCLIS or on any
similar federal or state list of sites requiring investigation or
clean-up. There are no underground storage tanks, active or
abandoned, including petroleum storage tanks, landfills, lagoons,
surface impoundments, disposal areas or disposal ponds, on or under
the Premises that are in violation of any applicable Environmental
Law except where such violation, taken singly or taken together
with all other such violations of Environmental Laws, has neither
resulted nor would, more likely than not, result in a Material
Adverse Effect. The Mortgagor has not and each of its Subsidiaries
has not directly transported or directly arranged for the
transportation of any Hazardous Material to any location which is
listed or proposed for listing on the National Priorities List
pursuant to CERCLA, on the CERCLIS or on any similar federal or
state list or which is the subject of any federal, state or local
enforcement actions or other investigations which may lead to
claims against the Mortgagor or any of its Subsidiaries for any
remedial work, damage to natural resources or personal injury,
including claims under CERCLA except where such actions, taken
singly or in the aggregate, have neither resulted nor would, more
likely than not, result in a Material Adverse Effect. There are no
polychlorinated biphenyls or friable asbestos present at the
Premises in violation of any applicable Environmental Law where
such violation, taken singly or taken together with all such
violations, has resulted or would, more likely than not, result in
a Material Adverse Effect. No conditions exist at, on or under the
Premises which, with the passage of time, or the giving of notice
or both, would give rise to liability under any Environmental Law
which liability, taken singly or together with all other such
liabilities, has resulted or would, more likely than not, be
expected to result in a Material Adverse Effect. No generation,
manufacture, storage, treatment, transportation or disposal of
Hazardous Material has occurred or is occurring on or from the
Premises which, when taken singly or taken together with all such
generation, manufacture, storage, treatment, transportation or
disposal, has resulted or would, more likely than not, result in a
Material Adverse Effect.
(b) Without limiting the representations made in Section
6.2(a), to the best knowledge of the Mortgagor, there are no
circumstances with respect to the Premises or the operations of the
Mortgagor or any of its Subsidiaries that could reasonably be
anticipated (i) to form the basis of an Environmental Claim against
the Mortgagor or any of its Subsidiaries or the Premises that,
taken singly or together with all such circumstances, has resulted
or would, more likely than not, result in a Material Adverse Effect
or (ii) to cause the Premises to be subject to any restrictions on
ownership, occupancy, use or transferability under any applicable
Environmental Law which have resulted or would, more likely than
not, result in a Material Adverse Effect.
(c) The Mortgagor will and will cause the Operator to use and
operate the Premises and all of its respective facilities thereon
in material compliance with all Environmental Laws except where
noncompliance, taken singly or with all other instances of
noncompliance, has neither resulted nor would, more likely than
not, result in a Material Adverse Effect. The Mortgagor will and
will cause the Operator to keep all necessary Environmental Permits
in effect and remain in material compliance therewith, and handle
all Hazardous Materials in compliance with all applicable
Environmental Laws except where noncompliance, when taken singly or
with all other instances of noncompliance, has neither resulted nor
would, more likely than not, result in a Material Adverse Effect.
The Mortgagor shall not, and shall not permit the Operator, to
suffer to exist an environmental condition which, when taken singly
or with all other such conditions, has resulted or would, more
likely than not, result in a Material Adverse Effect. The
Mortgagor shall promptly resolve any noncompliance with
Environmental Laws and keep the Premises property free of any Lien
imposed by any Environmental Law which individually or in the
aggregate has resulted or would, more likely than not, result in a
Material Adverse Effect.
(d) The Mortgagor shall conduct, or cause the Operator to
conduct, such investigation, study, sampling and testing, and
undertake, or cause the Operator to undertake, such cleanup,
removal, remedial or other action as may be necessary to comply
with all applicable Environmental Laws and any final orders or
directives of all governmental authorities; provided however, that,
this section shall not apply to any noncompliance with any such
orders or directives if and to the extent that the same shall be
contested in good faith by timely and appropriate proceedings which
are effective to stay enforcement thereof and against which
appropriate reserves have been established.
6.3 Right of Entry. In addition to all rights of entry contained
in this Mortgage, the Agent shall have the right to enter and
inspect the condition of the Premises at any reasonable time and to
conduct, or to designate a representative to conduct such
inspection, testing, environmental audit or other procedures that
the Agent believes are necessary or desirable to determine current
compliance with the covenants and representations contained herein.
6.4 Obligations of the Agent and the Banks. Nothing contained in
this Article 6 shall obligate the Agent or any of the Banks to take
any action with respect to the Premises, any Hazardous Materials
thereon, or any condition or activity that is in violation of
Environmental Laws or to take any action against any person with
respect to such substances, condition or activity.
6.5 Indemnification Provisions.
(a) The Mortgagor hereby covenants and agrees, at its sole
cost and expense, to indemnify, protect, defend and save harmless
each and every Indemnitee from and against any and all damages,
losses, liabilities, obligations, penalties, claims, litigation,
demands, defenses, judgments, suits, actions, proceedings, costs,
disbursements and/or expenses (including, without limitation,
attorneys' and experts' fees, expenses and disbursements) of any
kind or nature whatsoever which may at any time be imposed upon,
incurred by or asserted or awarded against any Indemnitee relating
to, resulting from or arising out of (i) Environmental Claims or
(ii) a material misrepresentation or inaccuracy in any
representation or warranty or a material breach of or failure to
perform any covenant made by the Mortgagor in this Mortgage.
(b) The liability of the Mortgagor to each Indemnitee
hereunder shall in no way be limited, abridged, impaired or
otherwise affected by (i) any amendment or modification of the Loan
Documents by or for the benefit of the Mortgagor or any subsequent
owner of the Premises, (ii) any extensions of time for payment or
performance of all or any portion of the Indebtedness or any other
person from the performance or observance of any of the agreements,
covenants, terms or conditions contained in the Loan Documents or
this Mortgage by operation of law, the Agent's voluntary act or
otherwise, (iii) the invalidity or unenforceability of any of the
terms or provisions of the Loan Documents, (iv) any exculpatory
provision contained in the Loan Documents limiting the Agent's or
the Banks' recourse to the Premises or to any other security in the
Indebtedness or limiting the Agent's or the Banks' rights to a
deficiency judgment against the Mortgagor, (v) any applicable
statute of limitations, (vi) any investigation or inquiry conducted
by or on behalf of the Agent or any other Indemnitee or any
information which the Agent or any other Indemnitee may have or
obtain with respect to the environmental or ecological condition of
the Premises, (vii) the sale, assignment or foreclosure of the
Indebtedness or this Mortgage, (viii) the sale, transfer or
conveyance of all or part of the Premises, (ix) the dissolution or
liquidation of the Mortgagor, (ix) the release or discharge, in
whole or in part, of the Mortgagor, in any bankruptcy, insolvency,
reorganization, arrangement, readjustment, composition, liquidation
or reorganization, arrangement, readjustment, composition,
liquidation or similar proceeding or (xi) any other circumstances
which might otherwise constitute a legal or equitable release or
discharge, in whole or in part, of the Mortgagor under the Loan
Documents or under this Mortgage.
ARTICLE 7 - SECURITY AGREEMENT
This Mortgage is hereby deemed to be as well a security
agreement for the purpose of creating a security interest in and to
all personal property owned by Mortgagor and comprising the
Premises (hereinafter the "Collateral") securing the Indebtedness.
This Mortgage also constitutes a financing statement with respect
to any and all property included in the Premises which is or may
become fixtures. Without derogating any of the provisions of this
Mortgage, the Mortgagor by this Mortgage:
(a) grants to the Agent a security interest in all of the
Mortgagor's right, title and interest in and to all Collateral,
including, but not limited to, the items referred to above,
together with all additions, accessions and substitutions and all
similar property hereafter acquired and used or obtained for use
on, or in connection with the Premises, and together with the
proceeds of the Collateral, which are intended to be hereby
secured; however, such intent shall never constitute an expressed
or implied consent on the part of the Agent or any of the Banks to
the sale of any or all of the Collateral;
(b) agrees that the security interest hereby granted by this
Mortgage shall secure the payment of the Indebtedness, including
any judgment, order or decree on the same;
(c) except as permitted in the Credit Agreement, agrees not
to sell, convey, mortgage or grant a security interest in, or
otherwise dispose of or encumber, any of the Collateral or any of
the Mortgagor's right, title or interest therein without first
securing Agent's written consent; and the Agent may, at its sole
option, require the Mortgagor to apply the proceeds from the
disposition of Collateral in reduction of the Indebtedness hereby
secured; provided, however, that the Agent agrees to terminate its
interest with respect to any Collateral which is either (i) sold in
accordance with the terms of Section 5.04(a) of the Credit
Agreement or (ii) sold with the Agent's prior written consent;
(d) except as expressly permitted in the Credit Agreement,
agrees that if any of the Mortgagor's rights in the Collateral are
voluntarily or involuntarily transferred, whether by sale, creation
of a security interest, attachment, levy, garnishment or other
judicial process, without the prior written consent of the Agent,
such transfer shall constitute an Event of Default by the Mortgagor
under the terms of this Mortgage;
(e) agrees that upon or after the occurrence of any Event of
Default hereunder, the Banks may, with or without notice to the
Mortgagor, but subject to the provisions of the Credit Agreement
(including the notice requirement set forth in Section 6.02
thereof), exercise their rights to declare all Indebtedness secured
by the security interest created hereby immediately due and
payable, in which case the Agent shall have all rights and remedies
granted by law and more particularly the Uniform Commercial Code as
adopted by the State (as the same may be amended, revised,
supplemented, substituted or replaced from time to time, the
"Code"), including, but not limited to, the right to take
possession of the Collateral, and for this purpose may enter upon
any premises on which any or all of the Collateral is situated
without being deemed guilty of trespass and without liability for
damages thereby occasioned, and take possession of and operate said
Collateral or remove it therefrom. The Agent shall have the
further right to take any action it deems necessary, appropriate or
desirable, at its option and in its discretion, to repair,
refurbish or otherwise prepare the Collateral for sale, lease or
other use or disposition, and to sell at public or private sales or
otherwise dispose of, lease or utilize the Collateral or any part
thereof in any manner authorized or permitted by law and to apply
the proceeds thereof toward payment of any costs and expenses
(including reasonable attorneys' fees and legal expenses, to the
extent permitted by law) thereby incurred by the Agent and toward
payment of the Indebtedness, in such order and manner as the Agent
may elect. Any notice given by the Agent as provided herein at
least ten (10) days before the time of sale or disposition shall be
deemed reasonable and shall fully satisfy any requirements for
giving of said notice;
(f) agrees, to the extent permitted by law and without
limiting any rights and privileges herein granted to the Agent,
that upon the occurrence of an Event of Default the Agent may
dispose of any or all of the Collateral at the same time and place
upon giving the same notice provided for in this Mortgage, and in
the same manner as the nonjudicial foreclosure sale provided under
the terms and conditions of this Mortgage;
(g) authorizes the Agent to file, in the jurisdiction where
this Mortgage will be given effect, one or more financing or
continuation statements and amendments thereto, relative to all or
any part of the Collateral without the signature of the Mortgagor
where permitted by law (a carbon, photographic or other
reproduction of this Mortgage or any financing statement covering
the Collateral or any part thereof shall be sufficient as a
financing statement where permitted by law); and
(h) acknowledges that the Mortgagor as of the date hereof,
has joined the Agent in the execution of one or more financing
statements, to be filed in accordance with the provisions of the
Code.
ARTICLE 8 - DEFAULTS AND REMEDIES
8.1 Default. Any of the following occurrences or acts shall
constitute an Event of Default ("Event of Default") under this
Mortgage: (i) the Mortgagor shall fail to pay the Indebtedness or
any Obligation when due or when declared due in accordance with the
Credit Agreement prior to the expiration of the cure or grace
period applicable thereto, if any; (ii) the Mortgagor shall fail to
observe or perform any of its covenants, agreements or obligations
under Sections 4.6, 4.7, 4.12, 4.13(b) or 4.17 of this Mortgage;
(iii) the Mortgagor shall fail to observe or perform any of its
covenants, agreements or obligations under Sections 4.2, 4.3 or 6.2
of this Mortgage and shall fail to cure such failure within ten
(10) Business Days; (iv) the Mortgagor shall fail to observe or
perform any of its covenants, agreements or obligations under any
provision of this Mortgage not specifically set forth in clauses
(i), (ii) or (iii) above within thirty (30) Business Days after the
giving of written notice to the Mortgagor by any Bank that it is to
be remedied; (v) an Event of Default as defined in the Credit
Agreement shall occur and shall continue uncured after the
expiration of the cure or grace period applicable thereto, if any;
or (vi) any representation, warranty or statement (other than any
made by any Bank or the Agent pursuant to the Credit Agreement or
any Related Writing) made in this Mortgage shall be false or
erroneous in any respect when made or deemed made, as the case may
be.
8.2 Acceleration of Maturity; Remedies. Upon the occurrence of an
Event of Default, at the option of the Banks, in accordance with
the provisions of the Credit Agreement, the whole Indebtedness
hereby secured shall become immediately due and payable, although
the period specified for the payment thereof may not have expired,
anything contained in this Mortgage to the contrary
notwithstanding, and thereupon or at any time during the existence
of such Event of Default, the Agent may proceed to foreclose this
Mortgage or otherwise pursue any other right or remedy available
under this Mortgage, at law or in equity, including, but not
limited to, the rights and remedies set forth in Article 7 hereof
and in Sections 8.3 through 8.9 below.
8.3 Power of Sale. Upon the occurrence of an Event of Default,
the Agent is hereby granted the right, if and to the extent
permitted by law, to sell or cause to be sold at public auction the
Premises and to convey the same by the execution and delivery to
the purchaser at such sale of good and sufficient deeds and
instruments of conveyance in law, pursuant to the statute in such
case made and provided, and out of the proceeds of such sale to
retain the moneys due under the terms of this Mortgage, the costs
and charges of such sale and also the attorneys' fees, if and to
the extent required by law, rendering the surplus moneys (if any)
to the Mortgagor.
8.4 Performance By the Agent. The Mortgagor hereby agrees that in
the event the Mortgagor shall fail to comply with any or all of its
covenants, agreements, conditions and stipulations herein set forth
and such failure becomes an Event of Default, then the Agent shall
be and hereby is authorized and empowered at its option, but
without legal obligation so to do, to pay and/or perform the same
without waiver of any other remedy, including, without limitation,
payment and/or performance (i) of any unpaid obligation secured by
any lien on the Premises and all or any part of any unpaid Taxes;
(ii) to effect insurance on the Premises in the amounts required
hereunder; and (iii) to enter or have its agents enter upon the
Premises whenever necessary for the purpose of inspecting the
Premises and curing any Event of Default. The Mortgagor agrees
that the Agent and the Banks shall thereupon have a claim against
the Mortgagor for all sums paid by the Agent for such Taxes,
insurance, rents and defaults cured, together with a lien upon the
Premises for the sum so paid plus Default Rate. The Agent, in
making any payment herein as hereby authorized in the place and
stead of the Mortgagor relating to (i) Taxes, may do so according
to any bill, statement or estimate procured from the appropriate
public office without inquiry into the validity of any Tax, sale
forfeiture, tax lien or title or claim thereof; or (ii) any adverse
title, lien, statement of lien, encumbrance, claim or charge, shall
be the sole judge of the legality or validity of same; or (iii) any
other purpose herein and hereby authorized, but not enumerated in
this Section, may do so whenever, in its good faith judgment and
discretion, such advance or advances shall seem necessary or
desirable to protect the full security intended to be created by
this Mortgage, and provided further that in connection with any
advance, the Agent, in the event of apparent or thereafter adverse
title, lien or encumbrance, or foreclosure, by the Agent or any
other lien claimant, at its option, may and is hereby authorized to
obtain a continuation report of title prepared by a title insurance
company, the cost and expense of which shall be repayable by the
Mortgagor upon demand and shall be hereby secured.
8.5 Appointment of Receiver. In the event an action shall be
instituted to foreclose this Mortgage, or prior to foreclosure but
after the occurrence of an Event of Default, the Agent shall be
entitled to the appointment of receiver of the rents, issues and
profits of the Premises as a matter of right and without notice,
with power to collect the rents, issues and profits of the Premises
due and becoming due during the period of default and/or the
pendency of such foreclosure suit to and including the date of
confirmation of the sale under such foreclosure and during the
redemption period, if any, after such confirmation, such rents and
profits being hereby expressly assigned and pledged as security for
the payment of the Indebtedness secured by this Mortgage without
regard to the value of the Premises or the solvency of any person
or persons liable for the payment of the Indebtedness and
regardless of whether the Agent and the Banks have an adequate
remedy at law. The Mortgagor for itself and for any subsequent
owner of the Premises hereby waives any and all defenses to the
application for a receiver as above provided and hereby
specifically consents to such appointment without notice, but
nothing herein contained is to be construed to deprive the holder
of this Mortgage of any other right, remedy or privilege it may now
have under the law to have a receiver appointed. The provision for
the appointment of receiver and the assignment of such rents,
issues and profits is made an express condition upon which the
loans hereby secured are made. In such event, the court shall at
once on application of the Agent or its attorney in such action, ex
parte and without notice, appoint a receiver to take immediate
possession of, manage and control the Premises, for the benefit of
the holder or holders of the Indebtedness and of any other parties
in interest, with power to collect the rents and profits of the
Premises during the pendency of such action, and to apply the same
toward the payment of the Indebtedness, notwithstanding that the
Premises or any part thereof is occupied by the Mortgagor or any
other person. The rights and remedies herein provided for shall be
deemed to be cumulative and in addition to, and not in limitation
of, those provided by law; and if there be no receiver so
appointed, the Agent itself may proceed to collect the rents,
issues and profits from the Premises. From any said rents, issues
and profits collected by the receiver or by the Agent prior to a
foreclosure sale shall be deducted the cost of collection thereof
and the expenses of operation of the Premises, including but not
limited to real estate commissions, the receiver's fee and the
reasonable fees of its attorney, if any, the Agent's attorney's
fees, if permitted by law, and court costs; the remainder shall be
applied against the Indebtedness hereby secured. In the event such
rents, issues and profits and other income are not adequate to pay
all Taxes and other expenses of operation, the Agent may, but shall
not be obligated to, advance to any receiver the amounts necessary
to operate, maintain and repair the Premises and any such amounts
so advanced, together with interest thereon at the Default Rate
from and after the date of advancement, shall be secured by this
Mortgage and have the same priority of collection as the
Indebtedness.
8.6 Taking Possession of the Premises. Upon the occurrence of an
Event of Default, the Agent is authorized prior or subsequent to
the institution of any foreclosure proceedings to enter upon the
Premises, or any part thereof, and to take possession of the
Premises and of all books, records and accounts relating thereto
and to exercise without interference from the Mortgagor any and all
rights which the Mortgagor has with respect to the management,
possession, operation, protection or preservation of the Premises,
including the right to rent the same for the account of the
Mortgagor and to deduct from such rents all costs, expenses and
liabilities of every character incurred by the Agent in collecting
such rents and in managing, operating, maintaining, protecting or
preserving the Premises and to apply the remainder of such rents on
the Indebtedness hereby secured in such manner as the Agent may
elect. All such costs, expenses and liabilities incurred by the
Agent in collecting such rents and in managing, operating,
maintaining, protecting or preserving the Premises, if not paid out
of rents as hereinabove provided, shall constitute a demand
obligation owing by the Mortgagor and shall draw interest from the
date of expenditure until paid at the Default Rate, all of which
shall constitute a portion of the Indebtedness. If necessary to
obtain the possession provided for above, the Agent may invoke any
and all legal remedies to dispossess the Mortgagor, including
specifically one or more actions for forcible entry and detainer,
trespass to try title and restitution. In connection with any
action taken by the Agent pursuant to this Section, the Agent shall
not be liable for any loss sustained by the Mortgagor resulting
from any failure to let the Premises, or any part thereof, or from
any other act or omission of the Agent in managing the Premises
unless such loss is caused by the willful misconduct or bad faith
of the Agent, nor shall the Agent be obligated to perform or
discharge any obligation, duty or liability under any lease
agreement covering the Premises or any part thereof or under or by
reason of this instrument or the exercise of rights or remedies
hereunder. Nothing in this Section shall impose any duty,
obligation or responsibility upon the Agent and the Banks for the
control, care, management or repair of the Premises, nor for the
carrying out of any of the terms and conditions of any such lease
agreement; nor shall it operate to make the Agent and the Banks
responsible or liable for any waste committed on the Premises by
the tenants or by any other parties or for any dangerous or
defective condition of the Premises, or for any negligence in the
management, upkeep, repair or control of the Premises resulting in
loss or injury or death to any tenant, licensee, employee or
stranger. The Mortgagor hereby assents to, ratifies and confirms
any and all actions of the Agent and the Banks with respect to the
Premises taken under this Section.
8.7 Remedies Non-Exclusive. Each remedy or right of the Agent and
the Banks shall not be exclusive of but shall be in addition to
every other remedy or right now or hereafter existing at law or in
equity. No delay in the exercise or omission to exercise any
remedy or right accruing on any Event of Default hereunder shall
impair any such remedy or right or be construed to be a waiver of
any such Event of Default or acquiescence therein, nor shall it
affect any subsequent Event of Default of the same or different
nature. Every such remedy or right may be exercised concurrently
or independently and when and as often as may be deemed expedient
by the Agent and the Banks.
8.8 Execution of Judgment. If more than one property, lot,
parcel, estate or interest is covered by this Mortgage, and if this
Mortgage is foreclosed upon, or judgment is entered upon any
obligation hereby secured, execution may be made upon any one or
more of the properties, lots, estates, parcels or interests and not
upon the others, or upon all of such properties or parcels, either
together or separately, and at different times or at the same time,
and execution sales may likewise be conducted separately or
concurrently, in each case at the Agent's election.
8.9 Fees Payable on Foreclosure. In case of foreclosure of this
Mortgage in any court of law or equity, whether or not any order or
judgment has been entered therein, and to the extent permitted by
law, a reasonable sum as aforesaid shall be allowed for attorney's
fees of the plaintiff in such proceedings, for stenographer's fees
and for all moneys expended for documentary evidence and the cost
of a complete abstract of title and title report for the purpose of
such foreclosure, such sums to be secured by the lien of this
Mortgage; and, to the extent permitted by law, there shall be
included in any judgment or decree foreclosing this Mortgage and be
paid out of said rents, issues and profits or out of the proceeds
of any sale made in pursuance of any such judgment or decree: (i)
all costs and expenses of such suit or suits, advertising, sale and
conveyance, including attorneys' fees and stenographer's fees, if
and to the extent permitted by law, outlays for documentary
evidence and the cost of said abstract, examination of title and
title report; (ii) all moneys advanced by the Agent, if any, for
any purpose authorized in this Mortgage with interest as herein
provided; (iii) all the accrued interest remaining unpaid on the
Indebtedness; and (iv) the Indebtedness.
ARTICLE 9 - ASSIGNMENT OF LEASES AND RENTS
The Mortgagor hereby absolutely and unconditionally
assigns to the Agent all of its interest as lessor with respect to
all existing and future leases of the Premises (including, without
limitation, the Operator Lease). This assignment is a present
assignment of the Mortgagor's interest in all such leases and to
the rents and profits thereunder as additional collateral for the
Indebtedness hereby secured. This assignment of leases and rents
is a present, absolute and irrevocable assignment and is made to
secure and enforce the payment of the Indebtedness. The Mortgagor
hereby irrevocably grants to the Agent the present and continuing
right, coupled with an interest, to collect such rents and to
enforce such leases and to enter and possess the Premises for such
purposes. However, the Agent hereby conditionally waives such
right, and grants to the Mortgagor the revocable license to collect
and to enforce the same, provided, however, that said waiver and
such license of the Mortgagor to collect such rents and to enforce
such leases may, after the occurrence of an Event of Default, be
revoked by the Agent at any time by giving notice of such
revocation to the Mortgagor. All rents collected by the Mortgagor
after the giving of such notice of revocation by the Agent shall be
held by the Mortgagor as a trust fund for the Agent. Following
such notice of revocation, the Agent may retain and apply the rents
toward payment of the Indebtedness in such order and manner as the
Agent may elect.
ARTICLE 10 - GENERAL
10.1 No Waiver. No sale of the Premises, no forbearance on the
part of the Agent or the Banks, no extension of the time for the
payment of the Indebtedness or any change in the terms thereof
consented to by the Agent or any of the Banks shall in any way
whatsoever operate to release, discharge, modify, change or affect
the original liability of the Mortgagor herein, either in whole or
in part. No waiver by the Agent of any breach of any covenant of
the Mortgagor herein contained shall be construed as a waiver of
any subsequent breach of the same or any other covenant herein
contained. The failure of the Agent to exercise the option for
acceleration of maturity and/or foreclosure (including sale under
power of sale hereunder) following any Event of Default hereunder
or to exercise any other option granted to the Agent and the Banks
hereunder in any one or more instances, or the acceptance by the
Agent and the Banks of partial payments hereunder shall not
constitute a waiver of any such Event of Default, nor extend or
affect the grace period, if any, but such option shall remain
continuously in force with respect to any unremedied or uncured
Event of Default. Acceleration of maturity once claimed in
accordance with the Credit Agreement may, at the option of the
Agent and the Banks in accordance with the Credit Agreement, be
rescinded by written acknowledgment to that effect by the Agent,
but the tender and acceptance of partial payments alone shall not
in any way affect or rescind such acceleration of maturity, or
extend or affect the grace period, if any. The Agent and the Banks
may pursue their rights without first exhausting their rights
hereunder and all rights, powers and remedies hereby conferred upon
the Agent and the Banks are in addition to each and every right
which the Agent and the Banks may have hereunder at law or equity,
and may be enforced concurrently therewith.
10.2 Legal Proceedings. If any action or proceeding be commenced,
to which action or proceeding the Agent or any of the Banks is made
a party by reason of the execution of this Mortgage or the
Indebtedness or in which it becomes necessary to defend or uphold
the lien of this Mortgage, or the priority thereof or possession of
the Premises, or otherwise to perfect the security hereunder, or in
any suit, action, legal proceeding or dispute of any kind in which
the Agent or any of the Banks is made a party or appears as party
plaintiff or defendant, affecting the Credit Agreement, the Loan
Documents, the Indebtedness, this Mortgage, or the interest created
herein, or the Premises, including, but not limited to, bankruptcy,
probate and administration proceedings, foreclosure of this
Mortgage or any condemnation action involving the Premises, all
reasonable sums paid by the Agent or any of the Banks for the
expense of any litigation to prosecute and defend the rights and
liens created hereby shall be paid by the Mortgagor to the Agent,
together with interest thereon from the date of payment at the rate
of interest then applicable under the Credit Agreement. Any such
sum and the interest thereon shall be immediately due and payable
and be hereby secured, having the benefit and priority of the lien
hereby created.
10.3 Subrogation. Should the proceeds of the Indebtedness, the
repayment of which is hereby secured, or any part thereof, or any
amount paid out or advanced by the Agent, be used directly or
indirectly to pay off, discharge, or satisfy, in whole or in part,
any prior lien or encumbrance upon the Premises or any part
thereof, then the Agent and the Banks shall be subrogated to such
other liens or encumbrances and to any additional security held by
the holder thereof and shall have the benefit of the priority of
all of the same.
10.4 Release and Partial Release. The Mortgagor agrees, without
affecting the liability of any person for payment of the
Indebtedness hereby secured or affecting the lien of this Mortgage
upon the Premises or any part thereof (other than persons or
property explicitly released as a result of the exercise by the
Agent of its rights and privileges hereunder), that the Agent,
without notice, and without regard to the consideration, if any,
paid therefor, and notwithstanding the existence at that time of
any inferior liens thereon, may release as to itself and this
Mortgage any part of the security herein described or any person
liable for the Indebtedness (or any part thereof) hereby secured,
without in any way affecting the priority of the lien of this
Mortgage to the full extent of the Indebtedness remaining unpaid
upon any part of the security not expressly released, and may agree
with any party obligated on the Indebtedness or having any interest
in the security herein described to extend the time for payment of
any part or all of the Indebtedness hereby secured. Such agreement
shall not, in any way, release or impair the lien hereof, but shall
extend the lien hereof as against the title of all parties having
any interest in said security which interest is subject to said
lien. In the event the Agent: (i) releases, as aforesaid, any part
of the security described herein or any person liable for the
Indebtedness (or any part thereof) hereby secured, (ii) grants an
extension of time for any payments of the Indebtedness hereby
secured, (iii) takes other or additional security for the payment
thereof, or (iv) waives or fails to exercise any right granted
herein or in the Credit Agreement, or the Loan Documents, no such
act or omission shall release the Mortgagor, subsequent purchasers
of the Premises or any part thereof, or makers or sureties of this
Mortgage under any covenant of this Mortgage or preclude the Agent
or any of the Banks from exercising any right, power or privilege
herein granted or intended to be granted with respect to any other
Event of Default then made or any subsequent Event of Default.
10.5 Subordination.
(a) The Operator Lease and Operator's rights under the Lease
are subordinate to this Mortgage, together with any renewal,
consolidation, extension, modification, or replacement thereof,
which now or at any time affects the Premises or any interest of
the Mortgagor in the Premises. By acceptance of this Mortgage, the
Agent agrees that the Agent shall have no right to disturb
Operator's possession, use and occupancy of the Premises or
Operators's enjoyment of its rights under the Lease unless and
until a Lease Default shall occur under the Operator Lease. Any
foreclosure action with respect to this Mortgage shall not affect
Operator's rights under the Operator Lease unless and until a Lease
Default occurs. The foregoing provisions will be self-operative,
and no further instrument will be required in order to effect them.
However, the Mortgagor shall cause Operator to execute, acknowledge
and deliver at any time and from time to time upon demand by the
Agent or any other holder of this Mortgage, such documents as may
be requested by the Agent or any other holder of this Mortgage to
confirm or effect such subordination, provided that any such
document shall include a non-disturbance provision as set forth in
this Section satisfactory to Operator.
(b) Notwithstanding the provisions of Subparagraph (a) above,
at the option of the Agent, this Mortgage shall become subject and
subordinate in whole or in part (but not in respect to the priority
of entitlement to insurance proceeds or any award in condemnation)
to any or all leases and/or subleases (including, without
limitation, the Operator Lease) of all or any part of the Premises,
upon the execution by the Agent and recording thereof, at any time
hereafter, in the Office of the County Recorder where the Premises
are situated, a unilateral declaration to that effect.
10.6 Waiver of Homestead Rights and Appraisement. To the extent
permitted by law with respect to the Indebtedness and any renewals
or extensions thereof, the Mortgagor waives, relinquishes and
renounces any and all homestead and exemption rights and all
benefit of any and every law now or hereafter in force to exempt
from levy and sale, as well as the benefit of all valuation and
appraisement privileges and moratoria under or by virtue of the
constitution and laws of the State or any other state or of the
United States, now existing or hereafter enacted.
10.7 Covenants to Run with the Land. All the covenants hereof
shall run with the land.
10.8 No Claims Against Agent or the Banks. Nothing contained in
this Mortgage shall constitute any request by the Agent or any of
the Banks, express or implied, for the performance of any labor or
services or the furnishing of any materials or other property in
respect of the Premises or any part thereof, or be construed to
give the Mortgagor any right, power or authority to contract for or
permit the performance of any labor or services or the furnishing
of any materials or other property in such fashion as would provide
the basis for any claim either against the Agent or any of the
Banks or that any lien based on the performance of such labor or
services or the furnishing of any such materials or other property
prior to the lien of this Mortgage.
10.9 Further Assurances. The Mortgagor shall execute, acknowledge
and deliver any and all such further acts, conveyances, documents,
mortgages and assurances as the Agent may reasonably require for
accomplishing the purpose hereof forthwith upon the request of the
Agent, whether in writing or otherwise. If the Mortgagor shall not
have delivered to the Agent duly executed statements or agreements
referred to hereinabove within ten (10) days of the Agent's demand
therefor, the Agent may file such Uniform Commercial Code financing
statements or agreements in the name of the Mortgagor.
TheMortgagor hereby appoints the Agent as its attorney-in-fact in
connection with any of the applicable Premises covered by this
Mortgage, to execute and file on its behalf any Uniform Commercial
Code financing statements or other statements in connection
therewith with the appropriate public office. This power, being
coupled with an interest, shall be irrevocable so long as this
Mortgage remains in effect. The Mortgagor, within ten (10) days
after request by the Agent, will furnish a written statement duly
acknowledged, of the amount due upon this Mortgage and the
Indebtedness (both unpaid principal and accrued interest) and
whether any offset or defenses exist against the Indebtedness, and
any other information which might reasonably be requested in
connection with (i) the sale of the loan by the Agent or any of the
Banks to any third party or (ii) an audit of the Agent or any of
the Banks, which statement expressly shall provide that it may be
relied on for such purposes.
10.10 Recordation. At the request of the Agent, the Mortgagor, at
its expense, will cause all instruments of further assurance
requested by the Agent (including, without limitation, all
necessary amendments, supplements and continuation statements) at
all times to be kept recorded, filed and registered in such manner
and in such places as may be required by law in order fully to
establish, preserve and protect the lien of this Mortgage as a
valid first mortgage lien on all real property, fixtures and
interests therein included in the Premises, subject only to the
Permitted Encumbrances and any other Liens permitted by the Credit
Agreement, and a valid, perfected first priority security interest
in the Collateral, subject only to the Permitted Encumbrances and
any other Liens permitted by the Credit Agreement (including, in
each such case, without limitation, any such properties acquired
after the execution hereof), and the rights of the Agent and the
Banks as to the Premises. However, neither a demand so made by the
Agent, nor the failure of the Agent or any of the Banks to make any
such demand, shall be construed as a release of any such Premises,
or any part thereof, from the lien of this Mortgage, it being
understood and agreed that this covenant and any security
instrument delivered to the Agent or any of the Banks pursuant
hereto are cumulative and given as additional security.
10.11 Notices. All notices and other communications provided for
hereunder shall be in writing (including telecopier, telegraphic,
telex or cable communication) and mailed, telecopied, telegraphed,
telexed, cabled or delivered, if to the Mortgagor, at its address
at One SeaGate, Suite 1950, Toledo, Ohio 43604, Attention: Ms.
Erin C. Ibele; if to any Bank, at its Lending Office specified
opposite its name on Schedule I to the Credit Agreement; and if to
the Agent, at its address at 1900 East Ninth Street, Cleveland,
Ohio, Attention: Metro Ohio Division or, as to each party, at such
other address as shall be designated by such party in a written
notice to each of the other parties. All such notices and
communications shall, when mailed, telecopied, telegraphed, telexed
or cabled, be effective when deposited in the mails, telecopied,
delivered to the telegraph company, confirmed by telex answerback
or delivered to the cable company, respectively, except that
notices and communications to the Agent pursuant to Article 8 shall
not be effective until received by the Agent.
10.12 Governing Law. The Indebtedness secured hereby was incurred
in the State of Ohio pursuant to various documents executed in the
State of Ohio in connection with a multi-state transaction governed
by the laws of the State of Ohio. This Mortgage and all
substantive terms and provisions hereof shall be governed by and
construed according to the laws of the State of Ohio, except to the
extent that the creation, attachment and enforcement of the lien of
this Mortgage must be governed by the laws of the State.
10.13 Conflict With Laws. If any provision(s) hereof are in
conflict with any statute or rule of law of the State, or are
otherwise unenforceable for any reason whatsoever, then such
provision(s) shall be deemed null and void to the extent of such
conflict or unenforceability, but shall be deemed separable from
and shall not invalidate any other provisions of this Mortgage.
10.14 Interest Limitation. Nothing herein contained nor any
transaction related thereto shall be construed or shall so operate
either presently or prospectively to require the Mortgagor (a) to
pay interest at a rate greater than is now lawful in such case to
contract for, but shall require payment of interest only to the
extent of such lawful rate, or (b) to make any payment or do any
act contrary to law, but if any clause and provision herein
contained shall otherwise so operate to invalidate this Mortgage,
in whole or in part, then such clauses and provisions only shall be
held for naught as though not herein contained and the remainder of
this Mortgage shall remain operative and in full force and effect.
Any interest paid in excess of the lawful rate shall be refunded to
the Mortgagor. Such refund shall be paid by application of the
excessive amount of interest paid against the Indebtedness and
shall be applied in such order as the Agent may determine. If the
excessive amount of interest paid exceeds the Indebtedness, the
portion exceeding the Indebtedness shall be refunded in cash by the
Agent. Any such crediting or refund shall not cure or waive any
default by the Mortgagor hereunder or under the Indebtedness. The
Mortgagor agrees, however,that in determining whether or not any
interest payable under the Indebtedness or this Mortgage exceeds
the highest rate permitted by law, any non-principal payment
(except payments specifically stated in the Indebtedness to be
"interest"), including without limitation prepayment premiums and
late charges, shall be deemed, to the extent permitted by law, to
be an expense, fee, premium or penalty rather than interest.
10.15 Rules of Construction. Whenever used, the singular number
shall include the plural, the plural the singular and the use of
any gender shall include all genders. Each defined term used
herein and not otherwise defined herein hall have the meaning
ascribed such term in the Credit Agreement. All of the covenants
of the Mortgagor herein contained are joint and several.
10.16 Successors and Assigns; Assignment. This Mortgage is
binding upon the Mortgagor, its successors and assigns, and the
rights, powers and remedies of the Agent under this Mortgage shall
inure to the benefit of the Agent and its successors and assigns.
The Mortgagor may not assign its obligations or rights hereunder
without the consent of the Agent and each of the Banks. Each of
the Agent and the Banks may assign its rights hereunder subject to
the limitations set forth in Article VIII of the Credit Agreement.
10.17 Amendments and Waivers. No amendment or waiver of any
provision of this Mortgage, nor consent to any departure by the
Mortgagor therefrom, shall in any event be effective unless the
same shall be in writing and signed by the Majority Banks (as
defined in the Credit Agreement), and then such waiver or consent
shall be effective only in the specific instance and for the
specific purpose for which given; provided, however, that no
amendment, waiver or consent shall, unless in writing and signed by
all the Banks, do any of the following: (a) reduce the principal
of, or interest on, any fees or other amounts payable hereunder,
(b) change the method of computing of interest or any fee, (c)
release any Operator Lease Document from the operation of this
Mortgage other than as provided in Section 2.08 of the Credit
Agreement, (d) amend this Section 10.17 or (e) amend, modify or
waive any provision of this Mortgage where such provision requires
consent or waiver by all Banks or any amendment of such a provision
which would amend such requirement of consent by all Banks; and
provided, further, that no amendment, waiver or consent shall,
unless in writing and signed by the Agent in addition to the Banks
required above to take such action, affect the rights or duties of
the Agent under this Mortgage.
10.18 Waiver of Jury Trial. THE PARTIES ACKNOWLEDGE AND AGREE
THAT ANY CONTROVERSY THAT MAY ARISE UNDER THIS AGREEMENT AND THE
RELATED WRITINGS WOULD INVOLVE DIFFICULT AND COMPLEX ISSUES AND
THEREFORE AGREE THAT ANY LAW SUIT GROWING OUT OF OR INCIDENTAL TO
ANY SUCH CONTROVERSY WILL BE TRIED IN A COURT OF COMPETENT
JURISDICTION BY A JUDGE SITTING WITHOUT A JURY. THE MORTGAGOR
CONFIRMS THAT THE FOREGOING WAIVER IS INFORMED AND FREELY MADE.
10.19 Jurisdiction; Venue, Inconvenient Forum.
(a) EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY AND
UNCONDITIONALLY SUBMITS, FOR ITSELF AND ITS PROPERTY, TO THE
NONEXCLUSIVE JURISDICTION OF ANY OHIO STATE COURT OR FEDERAL COURT
OF THE UNITED STATED OF AMERICA SITTING IN CUYAHOGA COUNTY, OHIO,
AND ANY APPELLATE COURT FROM ANY THEREOF, IN ANY ACTION OR
PROCEEDING ARISING OUT OF OR RELATING TO THIS MORTGAGE, THE CREDIT
AGREEMENT, ANY COLLATERAL DOCUMENT OR ANY RELATED WRITING OR FOR
RECOGNITION OR ENFORCEMENT OF ANY JUDGMENT, AND EACH OF THE PARTIES
HERETO HEREBY IRREVOCABLY AND UNCONDITIONALLY AGREES THAT ALL
CLAIMS IN RESPECT OF ANY SUCH ACTION OR PROCEEDING MAY BE HEARD AND
DETERMINED IN ANY SUCH OHIO STATE OR, TO THE EXTENT PERMITTED BY
LAW, IN SUCH FEDERAL COURT. EACH OF THE PARTIES HERETO AGREES THAT
A FINAL JUDGMENT IN ANY SUCH ACTION OR PROCEEDING SHALL BE
CONCLUSIVE AND MAY BE ENFORCED IN OTHER JURISDICTIONS BY SUIT ON
THE JUDGMENT OR IN ANY OTHER MANNER PROVIDED BY LAW. NOTHING IN
THIS AGREEMENT SHALL AFFECT ANY RIGHT THAT ANY PARTY MAY OTHERWISE
HAVE TO BRING ANY ACTION OR PROCEEDING RELATING TO THIS MORTGAGE,
THE CREDIT AGREEMENT, ANY COLLATERAL DOCUMENT OR ANY RELATED
WRITING IN THE COURTS OF ANY JURISDICTION.
(b) EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY AND
UNCONDITIONALLY WAIVES, TO THE FULLEST EXTENT IT MAY LEGALLY AND
EFFECTIVELY DO SO, ANY OBJECTION THAT IT MAY NOW OR HEREAFTER HAVE
TO THE LAYING OF VENUE OF ANY SUIT, ACTION OR PROCEEDING ARISING
OUT OF OR RELATING TO THIS MORTGAGE, THE CREDIT AGREEMENT, ANY
COLLATERAL DOCUMENT OR ANY OTHER RELATED WRITING IN ANY OHIO STATE
OR FEDERAL COURT SITTING IN OHIO. EACH OF THE PARTIES HERETO HEREBY
WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW, THE DEFENSE OF AN
INCONVENIENT FORUM TO THE MAINTENANCE OF SUCH ACTION OR PROCEEDING
IN ANY SUCH COURT. THE MORTGAGOR CONFIRMS THAT THE FOREGOING
WAIVERS ARE INFORMED AND FREELY MADE.
10.20 Certain Defined Terms. As used herein, the term "Agent"
means National City Bank, a national banking association, acting in
its capacity as agent for its benefit and the ratable benefit of
the Banks, together with its successors and assigns in such
capacity, and the term "Banks" means National City Bank and certain
other banks as set forth in the Credit Agreement, and such other
banks as may become parties to the Credit Agreement from time to
time, together with their respective successors and assigns.
ARTICLE 11 - DEFEASANCE
The condition of this Mortgage is that if either (a) the
Mortgagor shall punctually pay the Indebtedness and all other
obligations hereby secured when due and owing, and shall perform
the covenants of the Mortgagor arising from the Indebtedness, and
shall punctually perform all of the Mortgagor's covenants and
agreements herein contained, or (b) the Mortgagor shall satisfy the
requirements of Section 2.08(b), 2.08(d) or 2.08(e) of the Credit
Agreement, this Mortgage shall be released by the Agent, at the
cost and expense of the Mortgagor; otherwise the same shall remain
in full force and virtue in law. In case of failure of the Agent
to so release this Mortgage, all claims for statutory penalties and
damages are hereby waived.
<PAGE>
IN WITNESS WHEREOF, the Mortgagor has caused this
Mortgage to be duly executed and delivered in Cleveland, Ohio as of
the day and year first above written.
Signed and acknowledged The "Mortgagor":
in the presence of:
HEALTH CARE REIT, INC.
______________________________ By:____________________________
Signature of Witness
(as to both signatures) Print
Name:__________________________
Print
Name:________________________ Title:_________________________
_____________________________ And:___________________________
Signature of Witness
(as to both signatures) Print
Name:__________________________
Print
Name:________________________ Title:_________________________
STATE OF OHIO )
) SS:
COUNTY OF CUYAHOGA )
BEFORE ME, a Notary Public in and for said County,
personally appeared HEALTH CARE REIT, INC., a Delaware corporation
(the "Mortgagor"), by _______________________________________, its
_____________________ and __________________________________, its
___________________ who acknowledged that they did sign the
foregoing Mortgage and that the same is the free act and deed of
said corporation and of the Mortgagor, and the free act and deed of
each of them personally and as such officer.
IN TESTIMONY WHEREOF, I have hereunto set my hand and
official seal at Cleveland, Ohio, this _______ day of
__________________, 1994.
____________________________________
Notary Public
My Commission Expires:
This instrument Prepared By:
CALFEE, HALTER & GRISWOLD
Suite 1800
800 Superior Avenue
Cleveland, Ohio 44114-2688
<PAGE>
EXHIBIT 1
TO
AMENDED AND RESTATED OPEN-END MORTGAGE, ASSIGNMENT OF RENTS
AND SECURITY AGREEMENT
Legal Description of Premises
<PAGE>
EXHIBIT 2
TO
AMENDED AND RESTATED OPEN-END MORTGAGE,ASSIGNMENT OF RENTS
AND SECURITY AGREEMENT
Permitted Encumbrances
1. Liens permitted under the Credit Agreement.
2. Real property taxes and assessments, both general and special,
which are a lien but not yet due and payable.
3. Zoning ordinances, if any.
4. Lease Agreement between the Mortgagor and ___________________,
dated ______, as amended by __________________________.
EXECUTION COPY
EXHIBIT H-2
THIS DEED OF TRUST SECURES FUTURE ADVANCES IN ACCORDANCE WITH
CHAPTER 443, MISSOURI REVISED STATUTES
[AMENDED AND RESTATED] DEED OF TRUST (WITH POWER OF SALE,
ASSIGNMENT OF RENTS AND SECURITY AGREEMENT)
[MISSOURI FORM]
Effective Date: _____________, 1994
Total Indebtedness (Exclusive of Interest Thereon)
Not To Exceed: $150,000,000
Maturity Date: _____________________, 1996
Grantor: Health Care REIT, Inc.
Grantor's Notice Address: One SeaGate, Suite 1950
Toledo, Ohio 43604
Attention: Ms. Erin C. Ibele
Beneficiary: National City Bank, as Agent
Beneficiary's Notice Address: National City Center
1900 East Ninth Street
Cleveland, Ohio 44114
Attention: Metro Ohio Division
Trustee: __________________________________
Trustee's Address: __________________________________
__________________________________
Fee Owner: Health Care REIT, Inc.
One SeaGate, Suite 1950
Toledo, Ohio 43604
Premises Address: __________________________________
__________________________________
_______________________ County
This Instrument Prepared By and
After Recording Return To: CALFEE, HALTER & GRISWOLD
Suite 1800
800 Superior Avenue
Cleveland, Ohio 44114-2688
<PAGE>
TABLE OF CONTENTS
Section Page
ARTICLE 1 - RECITALS . . . . . . . . . . . . . . . . . . . . . 3
ARTICLE 2 - OBLIGATIONS SECURED . . . . . . . . . . . . . . . 3
2.1 Security for Indebtedness . . . . . . . . . . . . . 3
2.2 Security for Future Advances . . . . . . . . . . . 4
ARTICLE 3 - REPRESENTATIONS AND WARRANTIES 4
3.1 Existence . . . . . . . . . . . . . . . . . . . . . 4
3.3 Enforceability . . . . . . . . . . . . . . . . . . 5
3.4 Litigation; Proceedings . . . . . . . . . . . . . . 5
3.5 Taxes . . . . . . . . . . . . . . . . . . . . . . . 5
3.6 Compliance with Laws . . . . . . . . . . . . . . . 5
3.7 ERISA . . . . . . . . . . . . . . . . . . . . . . . 5
3.8 Adverse Obligations; Labor Disputes . . . . . . . . 5
3.9 Insurance . . . . . . . . . . . . . . . . . . . . . 6
3.10 Solvency . . . . . . . . . . . . . . . . . . . . . 6
3.11 Investment Company Act Status . . . . . . . . . . . 6
3.12 Construction and Completion of Improvements . . . . 6
3.13 Title to the Premises . . . . . . . . . . . . . . . 6
3.14 Independence of Premises . . . . . . . . . . . . . 6
3.15 Business Purpose . . . . . . . . . . . . . . . . . 6
3.16 Full Disclosure . . . . . . . . . . . . . . . . . . 6
ARTICLE 4 - COVENANTS AND AGREEMENTS . . . . . . . . . . . . . 7
4.1 Payment of Indebtedness . . . . . . . . . . . . . . 7
4.2 Payment of Taxes . . . . . . . . . . . . . . . . . 7
4.3 Insurance . . . . . . . . . . . . . . . . . . . . . 7
4.4 Escrow Account for Taxes and Insurance . . . . . . 8
4.5 Changes in Law Regarding Taxes . . . . . . . . . . 9
4.6 Liens . . . . . . . . . . . . . . . . . . . . . . . 9
4.7 Transfers and Encumbrances . . . . . . . . . . . . 10
4.8 Waste . . . . . . . . . . . . . . . . . . . . . . . 10
4.9 Compliance with Laws and Private Restrictions . . . 10
4.10 Maintenance and Alterations . . . . . . . . . . . . 10
4.11 Management of the Premises . . . . . . . . . . . . 11
4.12 Performance of Prior Covenants . . . . . . . . . . 11
4.13 Compliance with Material Contracts; No Amendment
or Default of Material Contracts . . . . . . . . . 11
4.14 Visitation . . . . . . . . . . . . . . . . . . . . 11
4.15 Estoppel Certificates . . . . . . . . . . . . . . . 12
4.16 Indemnification . . . . . . . . . . . . . . . . . . 12
4.17 Notice Limiting Amount Secured -- Intentionally
Deleted . . . . . . . . . . . . . . . . . . . . . . 12
ARTICLE 5 - CASUALTY LOSSES AND EMINENT DOMAIN . . . . . . . . 12
5.1 Casualty Loss and Application of Insurance
Proceeds . . . . . . . . . . . . . . . . . . . . . 12
5.2 Takings . . . . . . . . . . . . . . . . . . . . . . 14
5.3 Distribution of Taking Proceeds and Insurance
Proceeds . . . . . . . . . . . . . . . . . . . . . 15
ARTICLE 6 - ENVIRONMENTAL COMPLIANCE . . . . . . . . . . . . . 15
6.1 Definitions . . . . . . . . . . . . . . . . . . . . 15
6.2 Environmental Representations and Covenants . . . . 16
6.3 Right of Entry . . . . . . . . . . . . . . . . . . 18
6.4 Obligations of the Beneficiary and the Banks . . . 18
6.5 Indemnification Provisions . . . . . . . . . . . . 18
ARTICLE 7 - SECURITY AGREEMENT . . . . . . . . . . . . . . . . 18
ARTICLE 8 - DEFAULTS AND REMEDIES . . . . . . . . . . . . . . 20
8.1 Default . . . . . . . . . . . . . . . . . . . . . . 20
8.2 Acceleration of Maturity; Remedies . . . . . . . . 20
8.3 Power of Sale . . . . . . . . . . . . . . . . . . . 20
8.4 Performance By the Beneficiary . . . . . . . . . . 20
8.5 Appointment of Receiver . . . . . . . . . . . . . . 21
8.6 Rights and Powers of Trustee; Sale of the
Premises after Default . . . . . . . . . . . . . . 21
8.7 Resignation and Substitution of Trustee;
Liability of Trustee . . . . . . . . . . . . . . . 23
8.8 Remedies Non-Exclusive . . . . . . . . . . . . . . 23
8.9 Execution of Judgment . . . . . . . . . . . . . . . 24
8.10 Fees Payable on Foreclosure . . . . . . . . . . . . 24
ARTICLE 9 - ASSIGNMENT OF LEASES AND RENTS . . . . . . . . . . 24
ARTICLE 10 - GENERAL . . . . . . . . . . . . . . . . . . . . . 24
10.1 No Waiver . . . . . . . . . . . . . . . . . . . . 24
10.2 Legal Proceedings . . . . . . . . . . . . . . . . 25
10.3 Subrogation . . . . . . . . . . . . . . . . . . . 25
10.4 Release and Partial Release . . . . . . . . . . . 25
10.5 Subordination . . . . . . . . . . . . . . . . . . 25
10.6 Waiver of Homestead Rights and Appraisement . . . 26
10.7 Covenants to Run with the Land . . . . . . . . . . 26
10.8 No Claims Against Beneficiary or the Banks . . . . 26
10.9 Further Assurances . . . . . . . . . . . . . . . . 26
10.10 Recordation . . . . . . . . . . . . . . . . . . . 26
10.11 Notices . . . . . . . . . . . . . . . . . . . . . 27
10.12 Governing Law . . . . . . . . . . . . . . . . . . 27
10.13 Conflict With Laws . . . . . . . . . . . . . . . . 27
10.14 Interest Limitation . . . . . . . . . . . . . . . 27
10.15 Rules of Construction . . . . . . . . . . . . . . 27
10.16 Successors and Assigns; Assignment . . . . . . . . 27
10.17 Amendments and Waivers . . . . . . . . . . . . . . 28
10.18 Waiver of Jury Trial . . . . . . . . . . . . . . . 28
10.19 Jurisdiction; Venue, Inconvenient Forum . . . . . 28
10.20 Certain Defined Terms . . . . . . . . . . . . . . 28
ARTICLE 11 - DEFEASANCE . . . . . . . . . . . . . . . . . . . 29
EXHIBITS
Exhibit 1 - Legal Description of Premises
Exhibit 2 - Permitted Encumbrances
<PAGE>
INDEX OF CERTAIN DEFINED TERMS
Term Definition
Beneficiary . . . . . . . . . . . . . . . . . . . . . Preamble
Banks . . . . . . . . . . . . . . . . . . . . . . . . Recitals
Borrower . . . . . . . . . . . . . . . . . . . . . . . Preamble
Casualty Loss . . . . . . . . . . . . . . . . . . . . Section 5.1
Code . . . . . . . . . . . . . . . . . . . . . . . . . Section 7.1
Collateral . . . . . . . . . . . . . . . . . . . . . . Section 3.9
Collateral Documents . . . . . . . . . . . . . . . . . Recitals
Credit Agreement . . . . . . . . . . . . . . . . . . . Recitals
Deed of Trust . . . . . . . . . . . . . . . . . . . . Preamble
Default Rate . . . . . . . . . . . . . . . . . . . . . Section 4.4
Environmental Claims . . . . . . . . . . . . . . . . . Section 6.1
Environmental Laws . . . . . . . . . . . . . . . . . . Section 6.1
Environmental Permits . . . . . . . . . . . . . . . . Section 6.1
Event of Default . . . . . . . . . . . . . . . . . . . Section 8.1
Grantor . . . . . . . . . . . . . . . . . . . . . . . Preamble
Hazardous Materials . . . . . . . . . . . . . . . . . Section 6.1
Improvements . . . . . . . . . . . . . . . . . . . . . Preamble
Indebtedness . . . . . . . . . . . . . . . . . . . . . Section 2.1
Insurance Proceeds . . . . . . . . . . . . . . . . . . Section 5.1
Indemnitee . . . . . . . . . . . . . . . . . . . . . . Section 6.1
Land . . . . . . . . . . . . . . . . . . . . . . . . . Preamble
Law . . . . . . . . . . . . . . . . . . . . . . . . . Section 3.2
Loan Documents . . . . . . . . . . . . . . . . . . . . Recitals
Net Insurance Proceeds . . . . . . . . . . . . . Section 5.1(b)(ii)
Net Restoration Award . . . . . . . . . . . . . . . . Section 5.2
Notes . . . . . . . . . . . . . . . . . . . . . . . . Recitals
Operator . . . . . . . . . . . . . . . . . . . . . . . Preamble
Operator Lease . . . . . . . . . . . . . . . . . . . . Preamble
Permitted Encumbrances . . . . . . . . . . . . . . . . Section 3.13
Person . . . . . . . . . . . . . . . . . . . . . . . . Section 6.1
Premises . . . . . . . . . . . . . . . . . . . . . . . Preamble
State . . . . . . . . . . . . . . . . . . . . . . . . Preamble
Taking . . . . . . . . . . . . . . . . . . . . . . . . Section 5.2
Taking Proceeds . . . . . . . . . . . . . . . . . . . Section 5.2
Tax . . . . . . . . . . . . . . . . . . . . . . . . . Section 4.2
Trustee . . . . . . . . . . . . . . . . . . . . . . . Preamble
<PAGE>
[AMENDED AND RESTATED] DEED OF TRUST (WITH POWER OF SALE,
ASSIGNMENT OF RENTS
AND SECURITY AGREEMENT)
KNOW ALL MEN BY THESE PRESENTS:
THAT THE UNDERSIGNED, HEALTH CARE REIT, INC., a Delaware
corporation, whose federal taxpayer identification number is
__________, having a mailing address at One SeaGate, Suite 1950,
Toledo, Ohio 43604, Attention: ___________________ (hereinafter
referred to as "Grantor"), for the purpose of securing the payment
of the Indebtedness (hereinafter defined) to NATIONAL CITY BANK, a
national banking association, as Agent for its benefit and the
ratable benefit of the Banks (as defined below), their successors
and assigns (together with its successors and assigns in such
capacity, "Beneficiary"), National City Center, 1900 East Ninth
Street, Metro Division, Cleveland, Ohio 44114, has granted,
bargained, sold, transferred, assigned and conveyed, and by these
presents does grant bargain, sell, transfer, assigns, conveey and
confirm unto __________________________, having a mailing address
at ________________________________________________, as Trustee and
unto his successors or assigns in the trust hereby created (such
trustee, and any successors in trust being hereinafter referred to
as the "Trustee"), and unto his or their assigns and successors,
forever, all right, title and interest of the Grantor (whether fee,
leasehold, legal, or equitable) in and to the following real and
personal property (hereinafter collectively referred to as the
"Premises"), and possession of said Premises now delivered unto the
Trustee:
(a) the real property situated in the City of _________,
County of _________, State of Missouri (the "State"), described in
Exhibit 1 attached hereto and made a part hereof by reference,
together with all rights and easements now or hereafter created
which are appurtenant thereto (including without limitation all
streets, alleys, passages, water, water courses, riparian rights,
minerals, rights, liberties and privileges thereof, if any) and all
strips and gores and all related tenements and hereditaments, if
any (collectively referred to as the "Land"); and
(b) all buildings and improvements of every kind and
description now or hereafter erected or placed on the Land and all
materials intended for construction, reconstruction, alteration and
repair of such improvements now or hereafter erected thereon
(collectively, the "Improvements"), all of which materials shall be
deemed to be included within the Premises immediately upon the
delivery thereof to the Land, and all fixtures and articles of
personal property now or hereafter owned by the Grantor and
attached to, or located on, and used in the construction,
management or operation of the Land or the Improvements, including
but not limited to all furniture, furnishings, apparatus,
machinery, motors, elevators, fittings, radiators, awnings, shades,
blinds, office equipment, carpeting and other furnishings, and all
plumbing, heating, lighting, ventilating, refrigerating,
incinerating, air-conditioning and sprinkler equipment and fixtures
and appurtenances thereto, and all renewals or replacements
thereof, proceeds therefrom, or articles in substitution therefor,
whether or not the same are or shall be attached to the
Improvements in any manner; and
(c) all awards and other compensation heretofore or
hereafter to be made to the present and all subsequent owners of
the Premises for any taking by eminent domain, either permanent or
temporary, of all or any part of the Premises or any easement or
appurtenance thereof, including severance and consequential damage,
and change in grade of streets, which said awards and compensation
are hereby assigned to the Beneficiary; and
(d) all of the Grantor's right, title and interest in all
present and future leases, subleases, lettings and licenses of the
Premises including, without limitation, the Lease Agreement between
Grantor and ___________ (the "Operator"), dated __________ (the
"Operator Lease"), cash or securities (including guaranties,
letters of credit and other credit enhancement instruments or
agreements), deposited thereunder to secure performance by the
Grantor's tenants (including, without limitation, the Operator) of
their obligations thereunder, whether such cash or securities are
to be held until the expiration of the terms of such leases or
applied to one or more of the expiration of such terms, as well as
in and to all judgments, awards of damages and other proceeds
relating to rent, tenancies, subtenancies and occupancies of the
land, Improvements and personalty, and in and to present and future
remainders, rents, issues and profits thereof; and
(e) all of the Grantor's interest in and to all unearned
premiums accrued, accruing or to accrue under any and all insurance
policies now or hereafter obtained by the Grantor insuring all or
any portion of the Premises and in and to any and all proceeds
payable under any one or more of said policies; and
(f) all of the Grantor's interest in all rents, issues,
proceeds, income, revenue and profits of or accruing from any of
the foregoing and any renewals, replacements, substitutions,
extensions, improvements, betterments, appurtenances and additions
to the Improvements or personalty made or acquired by the Grantor
after the date hereof and all licenses, permits and other like
rights or interests now or hereafter held or acquired by the
Grantor and necessary or useful for the operation of the Premises.
TO HAVE AND TO HOLD all and singular the Premises, with
the appurtenances thereunto belonging unto the Trustee, his
successors and assigns forever.
IN TRUST, however, for the following purposes and upon
the terms, provisions and conditions herein set forth.
The Trustee hereby lets the Premises to Grantor until a
sale be had under the provisions therefor, upon the following terms
and conditions hereof, the Grantor, and every and all persons
claiming or possessing the Premises, and any part thereof, by,
through, or under it shall or will pay rent therefor during said
term at the rate of $.01 per month, payable monthly upon demand and
shall and will surrender peaceable possession of the Premises, and
any part thereof, sold under said provisions, to Trustee, his
successors, assignees, or purchasers thereof under such sale,
within ten days after making of such sale, without notice or demand
therefor.
ARTICLE 1 - RECITALS
WHEREAS, Grantor, as the "Borrower" has entered into that
certain Amended and Restated Credit Agreement dated as of the
effective date hereof (as the same may be supplemented, amended,
restated, modified or substituted from time to time, the "Credit
Agreement"; capitalized terms used herein without definition have
the meanings ascribed to such terms in the Credit Agreement) with
National City Bank and certain other banks as set forth in the
Credit Agreement (such banks and such other banks as may become
parties to the Credit Agreement from time to time, together with
their respective successors and assigns, all being hereinafter
collectively referred to as the "Banks") and Beneficiary as agent
for its benefit and the ratable benefit of the Banks (together with
its successors and assigns in such capacity hereinafter referred to
as "Beneficiary"), pursuant to which the Banks have agreed to loan
to the Grantor up to $150,000,000 upon the terms and conditions set
forth therein [which Credit Agreement amends and restates in its
entirety that certain Credit Agreement, dated as of October 1,
1989, by and between the Grantor as "Borrower" and National City
Bank as Agent for itself and the other banks (the "Original Banks")
(National City Bank acting in such capacity is hereinafter referred
to as the "Original Beneficiary") which are parties thereto (the
"Original Credit Agreement")];
WHEREAS, to evidence the obligations of the Grantor to
the Banks under the Credit Agreement, the Grantor has executed and
delivered to the Banks one or more Revolving Credit Notes dated as
of the effective date hereof in the aggregate principal amount of
up to $150,000,000 (the "Notes")[, which Notes replace the notes
executed and delivered by the Grantor under the Original Credit
Agreement (the "Original Notes")];
WHEREAS, the Grantor has executed and delivered a certain
deed of trust in favor of the Original Beneficiary as beneficiary
thereunder recorded in Volume ___________, Page ___________,
_________ County Records (the "Original Deed of Trust") to secure
to the Original Beneficiary the obligations of the Grantor to the
Original Beneficiary and the Original Banks under the Original
Credit Agreement and all other instruments and agreements
evidencing or securing such obligations or otherwise related
thereto;]
WHEREAS, the Original Beneficiary has assigned to
Beneficiary the Original Credit Agreement, the Original Deed of
Trust, and all other instruments and agreements evidencing or
securing the obligations of the Grantor under the Original Credit
Agreement or otherwise related thereto;]
WHEREAS, the Grantor has executed and delivered to the
Beneficiary this Deed of Trust to secure to the Beneficiary the
obligations of the Grantor to the Banks under the Credit Agreement,
the Collateral Documents (as defined in the Credit Agreement), and
all Related Writings (as defined in the Credit Agreement) (the
Notes, the Credit Agreement, this Deed of Trust, the Collateral
Documents and the Related Writings are sometimes collectively
referred to herein as the "Loan Documents"),[which Deed of Trust
amends and restates the Original Deed of Trust in its entirety];
NOW, THEREFORE, for good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, and for
the purposes set forth below, the Grantor hereby covenants and
agrees as follows:
ARTICLE 2 - OBLIGATIONS SECURED
2.1 Security for Indebtedness. The Grantor has executed and
delivered this Deed of Trust for the purpose of securing the
performance of the covenants and agreements contained herein and in
any agreement made with respect to the obligations hereby secured,
and to secure the payment when due, but not necessarily in the
order set forth, of:
(a) any and all sums advanced, readvanced or loaned to,
or to be advanced, readvanced or loaned to, the Grantor pursuant
to, and all other obligations and liabilities of the Grantor
arising under or in connection with the Credit Agreement, together
with interest thereon at the rate or rates in effect from time to
time as provided in the Credit Agreement;
(b) all sums expended or advanced by the Beneficiary or
any of the Banks pursuant to any term or provision of this Deed of
Trust or any of the other Collateral Documents in accordance with
the Credit Agreement;
(c) all advances or disbursements of the Beneficiary
with respect to the Premises pursuant to Section 8.4 of this Deed
of Trust for the payment of taxes, levies, assessments, insurance
premiums or costs incurred in the protection of the Premises as
provided herein or by law; and
(d) the unpaid balances of any loan advances and all
other liabilities and indebtedness of the Grantor under the Credit
Agreement to the extent that the total unpaid indebtedness secured
hereby, exclusive of the interest thereon, does not exceed One
Hundred Fifty Million Dollars ($150,000,000);
(all of such debts, liabilities and obligations being collectively
referred to herein as the "Indebtedness"), and as security for the
payment of the Indebtedness the Grantor has granted to the
Beneficiary a lien against the Premises.
2.2 Security for Future Advances. This Deed of Trust is
given for the purpose of creating a lien on the Premises and
expressly is to secure not only the existing Indebtedness but also
(i) all extensions, renewals, modifications or reamortizations of
the Indebtedness, all increases or additions to the Indebtedness,
all loans and future advances and readvances made by the
Beneficiary or any of the Banks to the Grantor and all other debts,
obligations and liabilities of every kind and character of the
Grantor now or hereafter existing in favor of the Beneficiary and
the Banks whether such debts, obligations or liabilities be direct
or indirect, primary or secondary, joint or several, fixed or
contingent, and whether originally payable to the Beneficiary or
any of the Banks or to a third party and subsequently acquired by
the Beneficiary or any of the Banks and (ii) future advances or
readvances, whether such advances or readvances are obligatory or
to be made at the option of the Banks or otherwise, to the same
extent as if such future advances or readvances were made, whether
under the Credit Agreement, the Loan Documents, or otherwise, on
the date of the execution of this Deed of Trust, and creates such
a lien for all advances and readvances regardless of who is the
owner of the Premises at the time such advances and readvances are
made. The total amount of the Indebtedness may decrease or
increase from time to time and the Banks may or shall, as required
and obligated by the Credit Agreement, at any time after this Deed
of Trust is delivered for record to the Office of the County
Recorder where the Premises are situated, make future advances and
readvances to the Grantor; however, the total unpaid balance
secured at any one time shall not exceed $150,000,000 plus interest
thereon computed in accordance with the Credit Agreement and any
disbursement made for the payment of taxes, levies or insurance on
the Premises with interest on such disbursements computed in
accordance with the Credit Agreement. Any such future advances and
readvances, with interest, shall be secured by this Deed of Trust
and shall be evidenced by the Credit Agreement and the Loan
Documents.
ARTICLE 3 - REPRESENTATIONS AND WARRANTIES
The Grantor represents and warrants as follows:
3.1 Existence. The Grantor is duly organized, validly
existing and in good standing under the laws of the state of its
incorporation. The Supplemental Schedule (as defined in the Credit
Agreement) sets forth the name and address of the Grantor as of the
Closing Date, the chief executive office of the Grantor and the
jurisdiction in which the Grantor is incorporated. All of the
outstanding stock of each Subsidiary (as defined in the Credit
Agreement) of the Grantor is owned by the Grantor and is fully paid
and non-assessable and owned by the Grantor free from any security
interest, option, equity or other right of any kind. The Grantor
is duly qualified to transact business in each state or other
jurisdiction in which it owns or leases any real property or in
which the nature of the business conducted makes such qualification
necessary or, if not so qualified, such failure to qualify has
neither resulted nor would, more likely than not, result in a
Material Impairment or a Material Adverse Effect (as such terms are
defined in the Credit Agreement).
3.2 Power, Authorization and Consent. The execution,
delivery and performance by the Grantor of this Deed of Trust and
of all Related Writings (as defined in the Credit Agreement) to
which it is party and the creation of all liens and security
interests provided for herein or therein (a) are within the
Grantor's legal power and authority, (b) have been duly authorized
by all necessary or proper action of the Grantor, (c) do not
require the consent or approval of any governmental body, agency,
authority or any other Person (as defined in the Credit Agreement)
which has not been obtained and a copy thereof furnished to the
Beneficiary and (d) will not violate (i) any provision of any "Law"
(which for purposes of this Deed of Trust means any federal, state,
local or foreign law, ordinance, or regulation or any order, case
precedent, ruling, directive, judgment, injunction, award or decree
or request having the force of law or any other requirement of any
governmental or regulatory body, court, tribunal or arbitrator)
applicable to the Grantor, (ii) any provision of the Grantor's
certificate or articles of incorporation or by-laws or regulations,
or (iii) any material agreement or material indenture by which the
Grantor or the property of the Grantor is bound, except where such
violation specified in this clause (iii) has neither resulted nor
would, more likely than not, result in a Material Impairment or a
Material Adverse Effect (as such terms are defined in the Credit
Agreement, (e) will not result in the creation or imposition of any
lien or encumbrance on any property or assets of the Grantor except
as provided herein and in the Credit Agreement, or (f) will not
result in the disqualification of the Deed of Trust or any
Subsidiary of the Grantor as a REIT under Section 856 of the
Internal Revenue Code.
3.3 Enforceability. This Deed of Trust constitutes the
legal, valid and binding obligation of the Grantor, enforceable
against the Grantor in accordance with its terms subject to any
applicable insolvency or bankruptcy Law of general applicability
and general principles of equity and any limitations imposed by
standards of commercial reasonableness, good faith and fair
dealing.
3.4 Litigation; Proceedings. Except as set forth in the
Supplemental Schedule, no action, suit, investigation or proceeding
is now pending or, to the knowledge of the Grantor, threatened
against the Grantor at law, in equity or otherwise, or with respect
to this Deed of Trust or any Related Writing to which the Grantor
is a party, before any court, board, commission, agency or
instrumentality of any federal, state, local or foreign government
or of any agency or subdivision thereof, or before any arbitrator
or panel of arbitrators which has resulted or would, more likely
than not, result in a Material Adverse Effect.
3.5 Taxes. As of the Closing Date, the Grantor and each of
its Subsidiaries has filed all federal, state and local tax returns
which are required to be filed by it and paid all taxes due as
shown thereon, including interest and penalties (except to the
extent, if any, permitted by Section 5.03(a) of the Credit
Agreement).
3.6 Compliance with Laws. Without limiting the
representations made in Section 6.2, neither the Grantor, nor any
Subsidiary of the Grantor, nor, to the best knowledge of the
Grantor, the Operator, is in violation of any Law applicable to the
business or properties of the Grantor or any Subsidiary of the
Grantor, except for such minor and isolated violations when taken
singly or in the aggregate have neither resulted nor would, more
likely than not, result in a Material Adverse Effect.
3.7 ERISA. The Supplemental Schedule sets forth all of the
Employee Benefit Plans (as defined in the Credit Agreement) of the
Grantor and its ERISA Affiliates (as defined in the Credit
Agreement). No Accumulated Funding Deficiency (as defined in the
Credit Agreement) exists in respect of any Employee Benefit Plan of
the Grantor or any of its ERISA Affiliates which exceeds One
Hundred Thousand Dollars ($100,000). No Reportable Event (as
defined in the Credit Agreement) has occurred in respect of any
Employee Benefit Plan which is continuing and which (i) constitutes
grounds either for termination of the plan or for court appointment
of a trustee for the administration thereof or (ii) has resulted or
would, more likely than not, result in a Material Adverse Effect.
No "prohibited transaction" (as defined in Section 406 of ERISA or
Section 4975 of the Internal Revenue Code of 1986, as amended) has
occurred that has resulted in or would, more likely than not,
result in, a Material Adverse Effect. None of the Grantor or any
of its ERISA Affiliates has (i) had an obligation to contribute to
any Multiemployer Plan, as defined in Section 4001(a)(3) of ERISA,
since 1987 or (ii) incurred or reasonably expects to incur any
liability for the withdrawal from such a Multiemployer Plan which
liability has resulted or would, more likely than not, result in a
Material Adverse Effect.
3.8 Adverse Obligations; Labor Disputes. Except as set forth
in the Supplemental Schedule, the Grantor is not subject to any
contract, agreement, corporate restriction, judgment, decree or
order materially and adversely affecting its business, property,
assets, operations or condition, financial or otherwise, is not a
party to any labor dispute (other than grievance disputes which do
not in the aggregate materially and adversely affect any of the
operations, financial condition, or business of the Grantor and its
Subsidiaries, if any, on a consolidated basis), and there are no
strikes, slow downs, walkouts or other concerted interruptions of
operations by employees whether or not relating to any labor
contracts which have resulted or would, more likely than not,
result in a Material Adverse Effect.
3.9 Insurance. As of the Closing Date, the insurance
coverage of the Grantor consists of those insurance policies
disclosed on the Supplemental Schedule as required by and set forth
in Section 5.03(d) to the Credit Agreement and in the Collateral
Documents.
3.10 Solvency. The Grantor and each of its Subsidiaries is
Solvent (as defined in the Credit Agreement).
3.11 Investment Company Act Status. The Grantor is not an
"investment company" or an "affiliated person" of, or "promoter" or
"principal underwriter" for, an "investment company", as such terms
are defined in the Investment Company Act of 1940, as amended (15
U.S.C. Section 80(a)(1), et seq.).
3.12 Construction and Completion of Improvements. All
buildings and Improvements comprising the Premises have been
completed and installed in a good workmanlike manner, in compliance
with all applicable Law, ordinances, building codes and the plans
and specifications except where noncompliance with any of the
foregoing, when taken singly or with all other instances of
noncompliance, has neither resulted nor would, more likely than
not, result in a Material Impairment. The Premises are served by
electric, gas, sewer, water, telephone and other utilities required
for their present and contemplated uses and operation. Any and all
streets, utility lines and offsite improvements, which provide
access to the Premises or are necessary for its present and
contemplated uses, have been completed, are serviceable and have
been accepted or approved by appropriate governmental bodies.
3.13 Title to the Premises. (i) The Grantor has good and
marketable fee simple title to the Premises described on Exhibit 1,
free and clear of all liens, security interests, restrictions and
encumbrances except only those listed on Exhibit 2 attached hereto
and made a part hereof by reference (hereinafter collectively
referred to as the "Permitted Encumbrances"), (ii) the Grantor has
good and marketable title to each item of personal property
comprising the Premises (hereinafter collectively referred to as
the "Collateral) free and clear of all liens, security interests,
restrictions and encumbrances except only the Permitted
Encumbrances, and (iii) the Grantor has good right to bargain, sell
and convey the Premises in manner and form as above written. The
Grantor will warrant and defend the Premises with the appurtenances
thereunto belonging to the Trustee and the Beneficiary and the
Banks, their successors and assigns, forever against all lawful
claims and demands whatsoever subject only to the Permitted
Encumbrances.
3.14 Independence of Premises. The Grantor has not permitted
and shall not permit by act or omission any building or other
improvements on premises not subject to the lien of this Deed of
Trust to rely on the Premises or any part thereof or any interest
therein to fulfill any municipal or governmental requirement for
the existence of such premises or such building or improvement, and
no building or other improvement on the Premises has relied or
shall rely on any premises not subject to the lien of this Deed of
Trust or any interest therein to fulfill any governmental or
municipal requirement. Grantor shall not by act or omission impair
the integrity of the Premises as one or more separate subdivided
zoning lots separate and apart from all other premises.
3.15 Business Purpose. The Indebtedness is incurred solely
for a business purpose and not a personal, family, household or
agricultural purpose.
3.16 Full Disclosure. No information, exhibits or reports
furnished by the Grantor to the Beneficiary or any Bank omits to
state any fact necessary to make the statements contained therein
not materially misleading in light of the circumstances and
purposes for which such information was provided. The Grantor has
provided all information requested by the Beneficiary or any Bank
and all such information is complete and accurate in all material
respects.
ARTICLE 4 - COVENANTS AND AGREEMENTS
The Grantor and its successors and assigns hereby
covenant and agree with the Beneficiary and the Banks, their
successors and assigns, as follows:
4.1 Payment of Indebtedness. The Grantor will pay the
Indebtedness according to its tenor and effect when due and owing
and keep and perform all covenants, agreements, conditions and
stipulations thereof.
4.2 Payment of Taxes.
(a) The Grantor shall pay or cause to be paid, before
any penalty, interest or cost may be imposed, all real estate
taxes, assessments, levies, water and sewer rents and charges,
charges for public utilities and all other governmental charges,
general and special, ordinary and extraordinary, foreseen and
unforeseen, of any kind and nature whatsoever which at any time
during the term of this Deed of Trust may be assessed, levied,
imposed upon, or grow or become due and payable out of or in
respect of, or become a lien on, the Premises or any part thereof
or any appurtenance thereto or the Indebtedness or the interest of
the Beneficiary and the Banks therein excepting the federal income
tax imposed on the Beneficiary or the Banks under the laws of the
United States (all such taxes, assessments, levies, water and sewer
rents and charges, charges for public utilities, and other
governmental charges being hereinafter collectively referred to as
"Taxes", and any of the same being hereinafter referred to as a
"Tax"); provided, however, that if any Tax may at the option of the
taxpayer be paid in installments (whether or not interest shall
accrue on the unpaid balance of such Tax), the Grantor may exercise
the option to pay the same (and any accrued interest on the unpaid
balance of such Tax) in installments and, in such event, shall pay
such installments as the same respectively become due and before
any fine, penalty, further interest or cost may be added thereto.
The Grantor shall submit evidence of the payment of all Taxes to
the Beneficiary not less than ten (10) Business Days after the due
date for such payment. The Grantor shall be entitled to the
benefit of installment payments regarding any Tax which is payable
in installments, provided, however, in the event the Grantor fails
to make any installment payment when due, the entire amount of such
Tax (together with any accrued interest on the unpaid balance
thereof) shall, for the purposes of this Section 4.2, be deemed due
and payable by the Grantor in its entirety on the day a lien would
attach to the Premises.
(b) Notwithstanding the provisions of subsection (a)
above, (i) the Grantor shall have the right to contest in good
faith any Tax upon posting with the Beneficiary (or other agent if
required under applicable Law) sufficient security, satisfactory to
the Beneficiary, in its reasonable judgment, for the payment
thereof, with interest, costs and penalties, under written
agreement conditioning payment of such contested Taxes upon
determination of such contest, or prior thereto if the continuance
of such contest shall put the Premises in jeopardy of tax sale or
forfeiture; provided, however, that the Grantor shall not be
required to post such security so long as (A) no Event of Default
exists, and (B) the posting of such security is not required to
stay enforcement of such Tax and the Premises are not in jeopardy
of tax sale or forfeiture; and (ii) so long as there exists no
Event of Default under this Deed of Trust, the Grantor shall make
all payments of Taxes directly to the appropriate authorities and
without making the payments to the escrow account contemplated by
Section 4.4, but upon the occurrence of any Event of Default, the
provisions of Section 4.4 shall be automatically applicable and in
full force and effect.
4.3 Insurance.
(a) The Grantor shall cause the Operator of the Premises
to keep the Improvements on the Premises insured by a policy or
policies of all risk replacement cost insurance (with agreed amount
endorsement) against loss or damage by, or abatement of income
resulting from fire, flood and such other hazards, casualties and
contingencies (including, but not limited to, extended coverage,
vandalism, malicious mischief), in an amount not less than the
greater of (i) the full replacement cost thereof, or (ii) the
amount necessary so that none of the parties hereto shall be deemed
a co-insurer of a loss, and for such length of time as shall be
required by the Beneficiary, which such policy shall be for the
benefit of the Grantor and the Beneficiary, as their interests may
appear, and shall provide that no cancellation, reduction in
amount, or change in coverage shall be effective until at least
thirty (30) days after receipt by the Beneficiary of written notice
thereof. The Grantor shall cause the Operator of the Premises to
maintain flood insurance, if required pursuant to a designation of
the area in which the Premises are located as flood prone or a
flood risk area, as defined by the Flood Disaster Protection Act of
1973, as amended, in an amount of not less than the greater of (i)
the sum of the full replacement cost thereof, or (ii) the amount
necessary so that none of the parties hereto shall be deemed a co-
insurer of a loss, as well as comply with any additional
requirements of the National Flood Insurance Program as set forth
in said Act. In the event flood insurance in the required amount
is not available, flood insurance in the maximum amount available
shall be obtained.
(b) The Grantor shall cause the Operator of the Premises
to maintain for the mutual benefit of the Beneficiary and the
Grantor general public liability insurance against claims for
personal injury, death or property damage occurring upon, in or
about the Premises or any elevators therein and on, in or about the
adjoining streets and passageways, such insurance to afford
protection to such limits as the Beneficiary may from time to time
request, acting reasonably. All of such insurance shall be primary
and non-contributing with any insurance policy which may be carried
by the Beneficiary and the Banks.
(c) The Grantor shall cause the Operator of the Premises
to maintain all workers' compensation coverage required in
connection with the Premises by the applicable Law of the State.
(d) Absent the prior written consent of the Beneficiary,
all such insurance policies shall be paid in full for periods of
not less than one (l) year in advance. So long as there exists no
Event of Default under this Deed of Trust, the Grantor shall make
all payments of insurance premiums directly and without making the
payments to the escrow account contemplated by Section 4.4, but
upon the occurrence of an Event of Default, the provisions of
Section 4.4 shall be automatically applicable and in full force and
effect.
(e) All insurance policies shall be issued by an insurer
lawfully doing business in the State and satisfactory to the
Beneficiary, and, to the extent of its interest, are to be for the
benefit of and first payable in case of loss to the Beneficiary as
first mortgagee without contribution. In the event the insurance
coverage required hereunder is provided as part of a blanket
policy, then in such event the amount of the coverage specifically
applicable to the Premises shall be stated on the face of the
policy. The Grantor shall place and keep the original policies of
insurance required hereunder with the Beneficiary or, at the
Grantor's election, a copy thereof and an original certificate
thereof, and shall deliver to the Beneficiary a new policy (or a
copy thereof and an original certificate thereof) in replacement
for any expiring policy, with evidence of advance premium payments,
to the Beneficiary at least thirty (30) days before the date of
such expiration at the Beneficiary's address as set forth at the
beginning of this Deed of Trust, or at such other place or to such
other party as the Beneficiary may, from time to time, designate in
writing.
(f) The Grantor, to the full extent permitted by Law
and without invalidating the insurance with respect to the Premises
required above, shall obtain endorsements by all insurers waiving
any right of subrogation against tenants under any leases with
respect to the Premises and shall require the same of such tenants.
The Beneficiary and the Banks shall not, because of accepting,
rejecting, approving or obtaining insurance, incur any liability
for the existence, nonexistence, form or legal sufficiency thereof,
the solvency of any insurer, or the payment of losses.
(g) Upon foreclosure of this Deed of Trust, any Event of
Default, or other transfer of title or assignment of the Premises
in discharge, in whole or part, of the Indebtedness, all right,
title and interest of the Grantor in and to all policies of
insurance, or portions thereof, required by this Section 4.3 and
relating to the Premises shall inure to the benefit of and pass to
the Beneficiary.
4.4 Escrow Account for Taxes and Insurance. Subject to the
provisions of Sections 4.2(b) and 4.3(d) hereof, the Grantor will
pay to the Beneficiary in addition to the monthly payments of
principal and interest under the terms of the Indebtedness secured
hereby and concurrently therewith monthly until the Indebtedness is
fully paid, the following sums:
(a) A sum equal to one-twelfth (1/12) of the estimated
annual cost of the Taxes, and one-twelfth (1/12) of the annual
insurance premiums required to keep the buildings, fixtures and
equipment of the Premises insured as required hereunder, which
monthly payments shall be credited to an escrow account, to be held
by the Beneficiary without interest accruing thereon to pay each of
the said particular items. The amount of the estimated monthly
payment under this Section may be adjusted from time to time so
that the amount deposited by the Grantor shall approximate the
total sum required annually for payment of all Taxes and insurance
premiums required hereunder. This adjustment shall be made on
demand of the Beneficiary and any deficiencies shall be paid by the
Grantor within ten (10) days of the Beneficiary's demand therefor.
If funds in the escrow account are insufficient to pay all Taxes
and insurance premiums and the Grantor has failed, refused or
neglected to pay the same as they become due, the Beneficiary may,
but shall have no obligation to, pay the same plus any interest or
penalties due thereon. Any such amount so paid by the Beneficiary
shall be added to the Indebtedness forthwith with interest at the
default rate of interest as set forth in Section 2.06(c) of the
Credit Agreement (the "Default Rate"). No later than ten (10) days
prior to the date when any insurance premium payment or installment
of Taxes is due, without penalty, interest, or delinquency, the
Grantor shall present to the Beneficiary the bill for any such
premium or installment of Taxes, and the Beneficiary shall
immediately draw a check on the escrow account, payable to the
appropriate insurance provider for the insurance premiums or the
appropriate taxing authority for the Taxes, for the amount of said
premium or installment (to the extent such funds exist in the
escrow account), and shall deliver such check to the Grantor.
(b) Upon receipt of said check by the Grantor if such
funds are being escrowed, the Grantor shall pay and discharge, as
the same become payable, the insurance premiums and Taxes. The
Grantor will submit to the Beneficiary such evidence of the due and
punctual payment of all insurance premiums and Taxes as the
Beneficiary may require. Any deficiency in the fixed amount of any
such aggregate monthly payment not paid by Grantor to the
Beneficiary within the grace period, if any, applicable to payments
to be made under the Credit Agreement shall constitute an Event of
Default under this Deed of Trust. In the event of a sale of the
Premises (but without it being considered a waiver of any rights
contained herein), any such funds then on deposit with the
Beneficiary, automatically and without necessity of further notice
or written assignment, shall be transferred to and held thereafter
for the account of the new owner to be applied in accordance with
the foregoing; provided, however, that in the event any Event of
Default has occurred and is continuing at the time of a sale of the
Premises, such funds may be used by the Beneficiary to satisfy such
Event of Default. Any excess funds then remaining shall be
credited to subsequent payments of Taxes and insurance premiums.
If the amount of any such payment shall exceed the estimate
therefor, the Grantor shall upon demand forthwith make good the
deficiency. Failure to do so before the due date of such payment
shall be an Event of Default hereunder. If the Premises are sold
under foreclosure or are otherwise acquired by the Beneficiary
after the occurrence of an Event of Default, any remaining balance
of such accumulated funds shall, at the option of the Beneficiary,
be credited upon the Indebtedness as of the date on which title to
the Premises is transferred.
4.5 Changes in Law Regarding Taxes. If at any time the
United States or the State or any of their subdivisions having
jurisdiction shall levy, assess, or charge any Tax (i) upon this
Deed of Trust, the Indebtedness or the interest of the Beneficiary
and the Banks in the Premises or (ii) upon the Banks by reason of
or as holder of any of the foregoing, then the Indebtedness and the
accrued interest thereon shall be and become due and payable at the
option of the Beneficiary thirty (30) days after the mailing of
notice of such election to the Grantor; provided, however, said
option shall not be available if the Grantor lawfully may pay for
(or reimburse the Beneficiary and/or any or all of the Banks for)
such Tax including interest and penalties thereon to or for the
Beneficiary and elects to pay and does, in fact, pay when payable,
for all such Tax, including interest and penalties thereon. The
Grantor further agrees to deliver to the Beneficiary, at any time,
upon demand, such evidence as may be required by any government
agency having jurisdiction in order to determine whether the
Indebtedness hereby secured is subject to or exempt from any such
Tax or any other governmental filing or reporting requirement.
4.6 Liens. Except as permitted under the Credit Agreement,
the Grantor shall keep the Premises free and clear from all
mechanics' liens and statutory liens of every kind other than Taxes
which may be a lien but not yet due and payable. Further, the
Grantor will keep and maintain the Premises free from all claims of
all persons supplying labor, materials or services which will enter
into or otherwise contribute to the construction of any and all
buildings and improvements now being erected or which hereafter may
be erected on the Premises, notwithstanding by whom such labor or
materials may have been contracted; provided, however, that the
Grantor shall have the right to contest in good faith any such
mechanics' lien or statutory lien upon posting with the
Beneficiary, or such other agent as may be required pursuant to any
applicable statute, sufficient security, satisfactory to the
Beneficiary in its reasonable judgment, for the payment thereof,
with interest, costs and penalties, under written agreement
conditioning payment of such contested mechanics' lien or statutory
lien upon determination of such contest, or prior thereto if the
continuance of such contest or litigation shall put the Premises in
jeopardy of foreclosure sale or forfeiture for such lien.
4.7 Transfers and Encumbrances.
(a) Except as permitted under the Credit Agreement and
except for the Permitted Encumbrances, the Grantor shall not sell,
encumber (including without limitation by means of subordinate
mortgage or lien upon the Premises or any part thereof), assign,
lease or dispose of the Premises or any part thereof or interest
thereon, or (ii) enter into any contract or agreement to do
anything prohibited by clause (i) of this Section 4.7, expressly
including without limitation any land contract, lease/purchase,
lease/option or option agreement without, in each such case, first
obtaining the written consent of the Beneficiary. Any such lease
or agreement not actually approved by the Beneficiary shall, at the
option of the Beneficiary, be null and void and shall not grant any
rights in the Premises to the parties named therein. If the
Grantor (or any permitted successor-in-interest thereof) is a
corporation, then any merger, consolidation or liquidation shall
constitute a sale of the Premises for the purpose of this Deed of
Trust. If the Grantor (or any permitted successor-in-interest
thereof) is a partnership, then any transfer of ownership of any
partnership interests shall constitute a sale of the Premises for
purposes of this Deed of Trust. Except as permitted under the
Credit Agreement, in the event title to the Premises or any part
thereof or interest therein becomes vested in a person or persons
not approved by the Beneficiary, the Indebtedness shall become due
and payable in full at the option of the Banks in accordance with
the terms of the Credit Agreement. In the event title to the
Premises or any part thereof or interest therein becomes vested in
a person or persons other than the Grantor or the Beneficiary, the
Beneficiary may, without notice to the Grantor, deal with such
successor- or successors-in-interest with respect to this Deed of
Trust and the Indebtedness in the same manner as with the Grantor,
without in any way releasing, discharging or otherwise affecting
any liability of the Grantor under this Deed of Trust or for the
Indebtedness.
(b) The consent of the Beneficiary required hereunder
may be refused or predicated upon any terms, conditions and
covenants deemed advisable or necessary by the Beneficiary in its
sole discretion, including but not limited to the right to change
the interest rate, date of maturity or payments of principal and/or
interest, to require payment of any amounts as additional
consideration as a transfer fee or otherwise and to require
assumption of this Deed of Trust and/or one or more Notes. Any
lease or sublease of the Premises or any part thereof or interest
therein shall provide for the attornment by the subtenant thereof
and of all subtenants or estates thereunder to the owner of the
Premises after foreclosure or after a deed in lieu of foreclosure
in the event the lease or sublease would otherwise have been
terminated because of foreclosure.
4.8 Waste. The Grantor shall not commit waste upon the
Premises or suffer waste to be committed thereon.
4.9 Compliance with Laws and Private Restrictions. The
Grantor will keep the Premises in full compliance with Law
applicable to or affecting the Premises if noncompliance with such
Law, when taken singly or with all other instances of
noncompliance, has either resulted or would, more likely than not,
result in a Material Adverse Effect. The Grantor shall observe and
comply with all conditions and requirements necessary to preserve
and extend any and all rights, licenses, permits (including but not
limited to zoning variances, special exceptions and non-conforming
uses), privileges, franchises and concessions which are applicable
to the Premises or which have been granted to or contracted for by
the Grantor in connection with any existing or presently
contemplated use of the Premises and shall obtain and keep in full
force and effect all necessary governmental and municipal approvals
as may be necessary from time to time to comply with all
environmental, ecological and other requirements and with any and
all conditions attached to the insurance relating to the Premises
and maintenance thereof, if noncompliance with any of the
foregoing, when taken singly or with all other instances of
noncompliance, has either resulted or would, more likely than not,
result in a Material Adverse Effect.
4.10 Maintenance and Alterations. The Grantor shall, or
shall cause the Operator of the Premises to, construct, keep and
maintain and make all necessary and proper replacements to all
buildings and improvements (including fixtures) and all apparatus
and personal property owned by the Grantor now or hereafter
situated on the Premises at all times in good working order,
condition and repair, fit and proper for the respective purposes
for which they were erected or installed, ordinary wear and tear
excepted, and shall refrain from wasting or destroying any such
necessary assets or any part thereof and from being negligent in
the care or use thereof. No buildings or substantial improvements
on the Premises shall be materially altered or demolished or
removed by the Grantor without the prior written consent of the
Beneficiary. The Grantor further covenants and agrees to make no
alterations to the buildings and improvements now or hereafter
located on the Premises that affect or change either the quantity
or quality thereof in any material respect, without the prior
written consent of the Beneficiary.
4.11 Management of the Premises. Except as permitted under
the Credit Agreement and except for the Operator Lease, the Grantor
shall not enter into any franchise, management, operating or
license agreement regarding the Premises without the Beneficiary's
prior written consent.
4.12 Performance of Prior Covenants. The Grantor hereby
acknowledges that the Indebtedness was incurred in good faith for
full value received. The Grantor covenants and agrees to make all
payments and perform all conditions and covenants called for in any
prior mortgages, easements, restrictions or other encumbrances now
encumbering the Premises or any part thereof or interest therein
and those called for in any other superior estate of the Premises
prior to the expiration of the cure or grace period applicable
thereto, if any, and in the event of default in any such payment or
payments, conditions or covenants, the Beneficiary, without waiving
the option to declare an Event of Default hereunder, herein
reserves the right to make such payments, or perform such
conditions or covenants. Any and all such sums paid or expenses
incurred on behalf of the Beneficiary, together with interest
thereon from the date of payment at the Default Rate, shall be
added to the Indebtedness and be secured by this Deed of Trust.
4.13 Compliance with Material Contracts; No Amendment or
Default of Material Contracts.
(a) The Grantor shall perform and observe, and cause
each of its Subsidiaries to perform and observe, all the material
terms and provisions of each material contract relating to the
Premises to be performed or observed by it, including, without
limitation, the Operator Lease and all other Operator Lease
Documents (as defined in the Credit Agreement) and maintain each
such material contract in full force and effect, and enforce, to
the extent that the Grantor, in its reasonable judgment, determines
to be appropriate, each such material contract in accordance with
its terms if the failure of the Grantor to perform, observe or
enforce any one or more of such contracts has neither resulted nor
would, more likely than not, result in a Material Adverse Effect.
The Grantor shall not permit any Operator under any Operator Loan
or Operator Lease to remain in material default thereof if such
default has resulted or would, more likely than not, result in a
Material Adverse Effect.
(b) The Grantor shall not, and shall not permit any of
its Subsidiaries to take any action to amend, cancel, terminate,
waive any provision of, consent to the noncompliance with any term
of any material contract with respect to the Premises (material
contracts being deemed to include, without limitation, the Operator
Lease and the Operator Lease Documents); provided, however, that
the Grantor may take any such action so long as such action (i)
does not relate to a material financial provision of any agreement
which is the subject of the Collateral Assignment of Operator Lease
Documents of even date herewith (the "Collateral Assignment"), (ii)
does not relate to any provision in any agreement which is the
subject of the Collateral Assignment and which provision is
expressly for the benefit of the mortgagee or assignee with respect
thereto, (iii) is taken in the ordinary course of the Grantor's or
such Subsidiary's business, (iv) is consistent with the Grantor's
past practices, (v) which would not, more likely than not, result
in a Material Adverse Effect, (vi) will not have an adverse effect
on the interest (including the perfection and priority of any
security interest or Lien in favor of the Beneficiary or the
Grantor) of the Beneficiary and the Banks in such agreement or the
assets with respect thereto or otherwise result in a Material
Impairment.
4.14 Visitation. The Grantor shall permit, and shall cause
the Operator of the Premises to permit, upon receipt of not less
than two Business Days' prior written notice, each of the Banks
during normal business hours: (i) to examine the Premises with the
guidance and supervision of the Grantor, and to examine the
Grantor's financial records and to make copies of and extracts from
such records; and (ii) to consult with the Grantor's officers,
directors, accountants, actuaries, trustees and plan
administrators, as the case may be, in respect of the Grantor's
financial condition, properties and operations and the financial
condition of the Grantor's Employee Benefit Plans, each of which
parties is hereby authorized to make such information available to
each of the Banks to the same extent that it would to the Grantor;
provided, however, that, all information obtained shall be subject
to the provisions of Section 8.03 of the Credit Agreement.
4.15 Estoppel Certificates. Within ten (10) days after
request by the Beneficiary, the Grantor shall furnish the
Beneficiary with a statement, duly acknowledged and certified,
setting forth (i) the amount of the original principal amount of
the Indebtedness, (ii) the unpaid principal amount of the
Indebtedness, (iii) the rate of interest of the Indebtedness, (iv)
the date installments of interest and principal were last paid, (v)
any offsets or defenses to the payment of the Indebtedness, if any,
and (vi) that the Indebtedness and this Deed of Trust are valid,
legal and binding obligations of the Grantor and have not been
modified or if modified, giving the particulars of such
modification.
4.16 Indemnification. The Grantor hereby indemnifies and
agrees to protect, defend, and save harmless the Beneficiary and
the Banks from and against all liabilities, obligations, claims,
damages, penalties, causes of action, costs, and expenses
(including, without limitation, attorneys' fees and expenses),
imposed upon or incurred by or asserted against the Beneficiary or
any of the Banks (except liabilities, obligations, claims, damages,
penalties, causes of action, costs, and expenses resulting from the
Beneficiary's or a Bank's gross negligence or willful misconduct)
by reason of (i) ownership of this Deed of Trust, the Premises, or
any interest therein or receipt of any rents; (ii) any alleged
obligation or liability on the part of the Beneficiary to be
performed or discharged under the terms and provisions of any
agreements relating to the Premises, except for such liabilities as
the Beneficiary or any of the Banks may specifically assume
thereunder; (iii) any accident, injury to or death of persons or
loss of or damage to property occurring in, on, or about the
Premises or any part thereof or on the adjoining sidewalks, curbs,
adjacent property, or adjacent parking areas, streets, or ways;
(iv) any use, non-use, or condition in, on, or about the Premises,
or any part thereof or on the adjoining sidewalks, curbs, adjacent
property, or adjacent parking areas, streets or ways; (v) any
actions or omissions of the Grantor relating to this Deed of Trust
or the Loan Documents or any failure on the part of the Grantor to
perform or comply with any of the terms of this Deed of Trust or
the Loan Documents; (vi) the performance of any labor or services
or the furnishing of any materials or other property in respect of
the Premises or any part thereof; (vii) any lease agreement or
under or by reason of this Deed of Trust or the exercise of rights
or remedies hereunder and from any and all claims and demands
whatsoever which may be asserted against the Beneficiary or any of
the Banks by reason of any alleged obligations or undertakings on
its part to perform or discharge any of the terms, covenants or
agreements contained in any such lease agreement; or (viii) the
failure of any person to file timely with the Internal Revenue
Service an accurate Form 1099-B, Statement for Recipients of
Proceeds from Real Estate, Broker and Barter Exchange Transactions,
which may be required in connection with this Deed of Trust, or to
supply a copy thereof in a timely fashion to the recipient of the
proceeds of the transaction in connection with which this Deed of
Trust is made. Any amounts payable to the Beneficiary or any of
the Banks by reason of the application of this Section 4.16 shall
be secured by this Deed of Trust and shall become immediately due
and payable and shall bear interest at the rate of interest then
applicable under the Credit Agreement from the date loss or damage
is sustained by the Beneficiary and such of the Banks until paid.
The obligations and liabilities of the Grantor under this Section
4.16 shall survive the satisfaction, foreclosure, delivery of a
deed in lieu of foreclosure, execution, termination or cancellation
of the Notes, this Deed of Trust, the Credit Agreement, the Loan
Documents or any other documents relating thereto for whatever
reason.
4.17 Notice Limiting Amount Secured -- Intentionally Deleted.
ARTICLE 5 - CASUALTY LOSSES AND EMINENT DOMAIN
5.1 Casualty Loss and Application of Insurance Proceeds.
(a) Insurance Proceeds. Each of the parties hereto
agrees that all amounts and proceeds (including instruments) in
respect of the proceeds of any casualty insurance policy on the
Improvements (the "Insurance Proceeds"), shall be paid by the
respective insurers directly to the Beneficiary, and if paid to the
Grantor such Insurance Proceeds shall be received only in trust for
the Beneficiary, shall be segregated from other funds of the
Grantor and shall be forthwith paid over to the Beneficiary in the
same form as received (with any necessary endorsement). Each of
the parties hereto agrees, to the fullest extent that it
effectively may do so under applicable Law, that the Beneficiary
shall apply all such Insurance Proceeds in accordance with the
provisions of paragraph (b) of this Section 5.1.
(b) Repairs and Restoration.
(i) In case of any Casualty Loss when paragraph
(ii) of this subsection (b) is not applicable, and so long as no
"Event of Default" as defined in the Operator Lease has occurred
and is continuing under the Operator Lease (hereinafter referred to
as a "Lease Default"), the Grantor shall make or cause to be made
the repairs to or replacements of the Premises necessary to repair
and restore the Premises as nearly as possible to the condition the
Premises were in immediately prior to such Casualty Loss promptly
after the Insurance Proceeds are settled, and the Beneficiary shall
make the Insurance Proceeds received by the Beneficiary pursuant to
the provisions of this Deed of Trust as a result of such Casualty
Loss, after deduction of its reasonable costs and expenses, if any,
in collecting the same (the "Net Insurance Proceeds") available for
the repair and restoration of the Premises, provided that (i) no
Event of Default shall exist under the Loan Documents, and (ii) the
Grantor shall have provided to the satisfaction of the Beneficiary
(1) contracts for such repair or replacement demonstrating the
Grantor's ability to effect such repair or replacement at a cost
not greater than such Insurance Proceeds (or, if such cost is
greater, accompanied by an explanation of the source of funds for
such excess amounts satisfactory to the Beneficiary), and (2) cash-
flow projections and other assurances reasonably satisfactory to
the Beneficiary providing for the Grantor's ability to meet its
obligations under the Loan Documents during the period from such
Casualty Loss until and following completion of such repair or
replacement. Upon satisfaction of the provisions of the preceding
sentence of this paragraph, the Net Insurance Proceeds will be
disbursed by the Beneficiary to the Grantor to pay for the costs of
repair and restoration of the Premises. The Net Insurance Proceeds
shall be held by the Beneficiary in a separate interest-bearing
account until expended in connection with the repair and
restoration of the Premises, it being agreed that any Net Insurance
Proceeds (together with any accrued interest thereon) so held by
the Beneficiary shall constitute additional security for the
payment of the Indebtedness secured by this Deed of Trust. The Net
Insurance Proceeds (together with any accrued interest thereon)
shall be paid by the Beneficiary to the Grantor for application of
as much as may be necessary for the payment of the costs of repair,
rebuilding or restoration, either on completion thereof or as the
work progresses, as directed by the Grantor, subject to the
provisions of the Operator Lease. As a condition to the
disbursement of the Net Insurance Proceeds (and any accrued
interest thereon), the Beneficiary shall be entitled to receive (1)
title continuation from the title company insuring the Premises
evidencing that no mechanics' liens have been filed against the
Premises, (2) a certificate from an engineer selected by the
Beneficiary, certifying that all work in place has been completed
in accordance with the plans and specifications approved by the
Beneficiary and (3) certificates or affidavits from contractors and
materialmen that all sums payable to such contractors and
materialmen to the date of such certificates or affidavits have
been paid. The Beneficiary may, prior to making payment from such
separate award account, require the Grantor to provide evidence
that, or deposit with the Beneficiary moneys to be placed in such
account so that, there will be adequate moneys available for such
repair and restoration. The Beneficiary shall not be obligated to
make any payment from such account if there exists an Event or
Default hereunder. Any balance of the Net Insurance Proceeds
(together with any accrued interest thereon) held by the
Beneficiary remaining after payment of all costs of such repair,
rebuilding or restoration shall be applied by the Beneficiary in
accordance with Section 5.3 below.
(ii) If a Lease Default shall have occurred and an
Event of Default shall have occurred and be continuing at the time
of a Casualty Loss, all insurance payments in respect of such
portion of the Premises shall be paid to and applied by the
Beneficiary as specified in Section 5.3 hereof. If there shall
have occurred a Casualty Loss resulting in the actual or
constructive total loss of all of the Premises or more than 50% of
the licensed beds at the health care facility operated by Operator
at the Premises under the Operator Lease, all insurance payments in
respect of such portion of the Premises shall be paid to and
applied by the Beneficiary as specified in Section 5.3 hereof,
subject to the terms of the Operator Lease.
5.2 Takings. If any compulsory transfer or taking or
transfer under threat of compulsory transfer or taking by any
agency, department, authority, commission, board, instrumentality,
or political subdivision of the State or the United States of
America shall be threatened in writing or occur with respect to all
or any portion of the Premises (each such occurrence being
hereinafter referred to as a "Taking"), the Grantor shall (i)
promptly upon any such threat of which it is aware or occurrence
provide written notice thereof to the Beneficiary, (ii) diligently
pursue all its rights to compensation against the State or the
United States, as the case may be, or against any agency,
department, authority, commission, board, instrumentality or
political subdivision thereof in respect of such Taking, (iii) not,
without the written consent of the Beneficiary, compromise or
settle any claim against the State or the United States, as the
case may be, or against any agency, department, authority,
commission, board, instrumentality or political subdivision
thereof, (iv) hold all amounts and proceeds (including instruments)
received in respect of any Taking ("Taking Proceeds") in trust for
the benefit of the Beneficiary segregated from other funds of the
Grantor and (v) forthwith pay over to the Beneficiary all such
amounts and proceeds in the same form as received (with any
necessary endorsement), free and clear of any encumbrances of any
kind or nature whatsoever, to be applied in accordance with the
provisions of this Section or Section 5.3 below, as the case may
be. To the extent that participation is legally available to the
Beneficiary, the Beneficiary may participate in any Taking
proceedings, and the Grantor shall from time to time use its best
efforts to deliver to the Beneficiary, to the furthest extent
possible, all instruments requested by it to permit such
participation.
Notwithstanding any Taking, the Grantor shall continue to
pay all payments at the time and in the manner provided for in the
Loan Documents and the amount outstanding on the Indebtedness shall
not be reduced until any award or payment therefor shall have been
actually received and applied by the Beneficiary to the prepayment
of the Indebtedness under the Credit Agreement. If the Premises
are sold, through foreclosure or otherwise, prior to the receipt by
the Beneficiary of the Taking Proceeds, the Beneficiary shall have
the right to receive such Taking Proceeds or a portion thereof
sufficient to repay the Indebtedness as though the same were being
prepaid under the Credit Agreement, whichever is less. The Grantor
shall file and prosecute its claim or claims for any such award or
payment in good faith and with due diligence and cause the same to
be collected and paid over to the Beneficiary, and hereby
irrevocably authorizes and empowers the Beneficiary, in the name of
the Grantor or otherwise to collect and receipt for any such award
or payment and to file and prosecute such claim or claims, and
although it is hereby expressly agreed that the same shall not be
necessary in any event, the Grantor shall, upon demand of the
Beneficiary, make, execute and deliver any and all assignments and
other instruments sufficient for the purpose of assigning any such
award or payment to the Beneficiary, free and clear of any
encumbrances of any kind or nature whatsoever.
If less than all the Premises are taken, unless in the
reasonable judgment of the Beneficiary such Taking will have a
material adverse effect on the business or financial condition of
(i) the Grantor or (ii) the Grantor and its Subsidiaries, if any,
on a consolidated basis, the Beneficiary shall make the proportion
of the aggregate award or payment received by the Beneficiary
pursuant to the provisions of this Deed of Trust as a result of
such Taking which is specifically awarded for the repair and
restoration of the portion of the Premises not taken or in the
absence of any such specific award, is in the sole opinion of the
Beneficiary necessary to pay for the costs which will be incurred
in connection with the repair and restoration of the portion of the
Premises not taken after deduction of its reasonable costs and
expenses, if any, in collecting the same (the "Net Restoration
Award") available for the repair and restoration of the Premises
not taken, provided that (i) no Event of Default shall exist under
the Loan Documents, (ii) the Grantor shall proceed with the repair
and restoration of the Premises not taken as nearly as possible to
the condition the Premises not taken were in immediately prior to
such Taking promptly after the award is settled, and (iii) the
Beneficiary shall be satisfied that upon the completion of such
repair and restoration the appraised value of the Premises not
taken after such repair and restoration, will not be materially
less than the value immediately prior to such Taking, as determined
by an appraiser selected by the Beneficiary. Upon satisfaction of
the provisions of the preceding sentence of this paragraph, the Net
Restoration Award will be disbursed by the Beneficiary to the
Grantor to pay for the costs of repair and restoration of the
Premises not taken. The Net Restoration Award shall be held by the
Beneficiary in a separate interest-bearing account until expended
in connection with the repair and restoration of the Premises not
taken, it being agreed that any Net Restoration Award (together
with any accrued interest thereon) so held by the Beneficiary shall
constitute additional security for the payment of all sums secured
by this Deed of Trust. The Net Restoration Award (together with
any accrued interest thereon) shall be paid by the Beneficiary to
the Grantor for application of as much as may be necessary for the
payment of the costs of repair, rebuilding or restoration, either
on completion thereof or as the work progresses, as directed by the
Grantor. As a condition to the disbursement of the Net Restoration
Award (and any accrued interest thereon), the Beneficiary shall be
entitled to receive (i) title continuation from the title company
insuring the Premises evidencing that no mechanics' liens have been
filed against the Premises, (ii) a certificate from an engineer
selected by the Beneficiary, certifying that all work in place has
been completed in accordance with the plans and specifications
approved by the Beneficiary and (iii) certificates or affidavits
from contractors and materialmen that all sums payable to such
contractors and materialmen to the date of such certificates or
affidavits have been paid. The Beneficiary may, prior to making
payment from such separate award account, require the Grantor to
provide evidence that, or deposit with the Beneficiary moneys to be
placed in such account so that, there will be adequate moneys
available for such repair and restoration. The Beneficiary shall
not be obligated to make any payment from such account if there
exists an Event of Default hereunder. Any balance of the Net
Restoration Award (together with any accrued interest thereon) held
by the Beneficiary remaining after payment of all costs of such
repair, rebuilding or restoration shall be applied by the
Beneficiary in accordance with Section 5.3 below.
5.3 Distribution of Taking Proceeds and Insurance Proceeds.
Except as otherwise provided in this Article 5, all Taking Proceeds
and Insurance Proceeds with respect to the occurrence of a Casualty
Loss or Taking, as well as all payments or amounts then held or
thereafter received by the Beneficiary under the Loan Documents as
collateral security for the Indebtedness may be applied by the
Beneficiary in any one or more of the following ways:
(a) to the fulfillment of any of the covenants contained
herein as the Beneficiary may determine, including, without
limitation, the replacement or restoration of the Premises to a
condition satisfactory to the Beneficiary, in accordance with this
Article 5;
(b) to the payment of all costs incurred in the
collection thereof (including, without limitation, reasonable
attorneys' fees and expenses except as may have been limited by Law
or by judicial order or decision entered in any action to foreclose
this Deed of Trust);
(c) to the payment of the Indebtedness secured by this
Deed of Trust owing to the Beneficiary (including any interest or
premium accrued thereon); and/or
(d) to or at the direction of the Grantor, unless a
court of competent jurisdiction may otherwise direct by final order
not subject to appeal.
ARTICLE 6 - ENVIRONMENTAL COMPLIANCE
6.1 Definitions. The following definitions apply to the
provisions of this Article:
(a) "Environmental Laws" means any federal, state or
local law, regulation, ordinance, or order pertaining to the
protection of the environment and the health and safety of the
public, including (but not limited to) the Comprehensive
Environmental Response, Compensation and Liability Act ("CERCLA"),
42 USC Sections 9601 et seq.; the Resource Conservation and Recovery Act
("RCRA"), 42 USC Sections 6901 et seq., the Hazardous Materials
Transportation Act, 49 USC Sections 1801 et seq., the Federal Water
Pollution Control Act (33 USC Sections 1251 et seq.), the Toxic
Substances Control Act (15 USC Sections 2601 et seq.) and the
Occupational Safety and Health Act (29 USC Sections 651 et seq.), and all
similar state, regional or local laws, treaties, regulations,
statutes or ordinances, common law, civil laws, or any case
precedents, rulings, requirements, directives or requests having
the force of law of any foreign or domestic governmental authority,
agency or tribunal, and all foreign equivalents thereof, as the
same have been or hereafter may be amended, and any and all
analogous future laws, treaties, regulations, statutes or
ordinances, common law, civil laws, or any case precedents,
rulings, requirements, directives or requests having the force of
law of any foreign or domestic governmental authority, agency or
tribunal and the regulations promulgated pursuant thereto, which
governs:
(i) the existence, cleanup and/or remedy of
contamination on property;
(ii) the emission or discharge of Hazardous
Materials into the environment;
(iii) the control of hazardous wastes;
(iv) the use, generation, transport, treatment,
storage, disposal, removal or recovery of Hazardous Materials; or
(v) the maintenance and development of wetlands.
(b) "Environmental Claims" means any and all
administrative, regulatory or judicial actions, suits, demands,
demand letters, claims, liens, notices of noncompliance or
violation, investigations, proceedings, consent orders or consent
agreements relating in any way to any Environmental Law or any
Environmental Permit ("Claims"), including, without limitation, (a)
any and all Claims by governmental or regulatory authorities for
enforcement, cleanup, removal, response, remedial or other actions
or damages pursuant to any applicable Environmental Law, and (b)
any and all Claims by any third party seeking damages,
contribution, indemnification, cost recovery, compensation or
injunctive relief resulting from Hazardous Materials or arising
from alleged injury or threat of injury to health or the
environment.
(c) "Environmental Permits" means all permits,
approvals, notifications, identification numbers, licenses and
other authorizations required under any applicable Environmental
Laws.
(d) "Hazardous Material" means and includes (i) any
asbestos or other material composed of or containing asbestos which
is, or may become, even if properly managed, friable; (ii)
petroleum and any petroleum product, including crude oil or any
fraction thereof, and natural gas or synthetic natural gas liquids
or mixtures thereof; (iii) any hazardous, toxic or dangerous waste,
substance or material defined as such in (or for purposes of)
CERCLA or RCRA, any so-called "Superfund" or "Superlien" law, or
any other applicable Environmental Laws, and (iv) any other
substance whose generation, handling, transportation, treatment or
disposal is regulated pursuant to any Environmental Laws.
(e) "Indemnitee" means the Beneficiary and the Banks and
all subsequent holders of the Indebtedness, their respective
successors and assigns, their respective officers, directors,
employees, agents, representatives, contractors and subcontractors
and any subsequent owner of the Premises who acquires title thereto
from or through the Beneficiary.
(f) "Person" means and includes an individual,
partnership, corporation (including a business trust), joint stock
company, trust, unincorporated association, joint venture or other
entity, or a government or any political subdivision or department
or agency thereof.
6.2 Environmental Representations and Covenants. The Grantor
represents, warrants, covenants and agrees as follows:
(a) The Premises is in material compliance with
Environmental Laws except where such noncompliance, taken singly or
taken together with all other noncompliance with Environmental
Laws, has neither resulted nor would, more likely than not, result
in a Material Adverse Effect. There is no noncompliance with any
Environmental Law or existence of any environmental condition
which, when taken singly or in the aggregate, has resulted or
would, more likely than not, result in a Material Adverse Effect.
With respect to the Premises (a) there are no pending or threatened
Environmental Claims against the Grantor or the Operator or any
other environmental condition with respect to the Premises which,
taken singly or taken together with all pending or threatened
Environmental Claims, has resulted or would, more likely than not,
result in a Material Adverse Effect, (b) the Grantor and the
Operator has been issued and is in compliance with all
Environmental Permits except where noncompliance, whether taken
singly or taken together with all other noncompliance with
Environmental Permits, has neither resulted nor would, more likely
than not, result in a Material Adverse Effect, (c) Hazardous
Materials have not been released or disposed of on or from the
Premises or, to the best knowledge of the Grantor, on or from any
property adjoining the Premises which, in either case, whether
taken singly or taken together with all other releases or
dispositions of Hazardous Materials, has resulted or would, more
likely than not, result in a Material Adverse Effect. No portion
of the Premises is listed or proposed for listing on the National
Priorities List pursuant to CERCLA, on the CERCLIS or on any
similar federal or state list of sites requiring investigation or
clean-up. There are no underground storage tanks, active or
abandoned, including petroleum storage tanks, landfills, lagoons,
surface impoundments, disposal areas or disposal ponds, on or under
the Premises that are in violation of any applicable Environmental
Law except where such violation, taken singly or taken together
with all other such violations of Environmental Laws, has neither
resulted nor would, more likely than not, result in a Material
Adverse Effect. The Grantor has not and each of its Subsidiaries
has not directly transported or directly arranged for the
transportation of any Hazardous Material to any location which is
listed or proposed for listing on the National Priorities List
pursuant to CERCLA, on the CERCLIS or on any similar federal or
state list or which is the subject of any federal, state or local
enforcement actions or other investigations which may lead to
claims against the Grantor or any of its Subsidiaries for any
remedial work, damage to natural resources or personal injury,
including claims under CERCLA except where such actions, taken
singly or in the aggregate, have neither resulted nor would, more
likely than not, result in a Material Adverse Effect. There are no
polychlorinated biphenyls or friable asbestos present at the
Premises in violation of any applicable Environmental Law where
such violation, taken singly or taken together with all such
violations, has resulted or would, more likely than not, result in
a Material Adverse Effect. No conditions exist at, on or under the
Premises which, with the passage of time, or the giving of notice
or both, would give rise to liability under any Environmental Law
which liability, taken singly or together with all other such
liabilities, has resulted or would, more likely than not, be
expected to result in a Material Adverse Effect. No generation,
manufacture, storage, treatment, transportation or disposal of
Hazardous Material has occurred or is occurring on or from the
Premises which, when taken singly or taken together with all such
generation, manufacture, storage, treatment, transportation or
disposal, has resulted or would, more likely than not, result in a
Material Adverse Effect.
(b) Without limiting the representations made in Section
6.2(a), to the best knowledge of the Grantor, there are no
circumstances with respect to the Premises or the operations of the
Grantor or any of its Subsidiaries that could reasonably be
anticipated (i) to form the basis of an Environmental Claim against
the Grantor or any of its Subsidiaries or the Premises that, taken
singly or together with all such circumstances, has resulted or
would, more likely than not, result in a Material Adverse Effect or
(ii) to cause the Premises to be subject to any restrictions on
ownership, occupancy, use or transferability under any applicable
Environmental Law which have resulted or would, more likely than
not, result in a Material Adverse Effect.
(c) The Grantor will and will cause the Operator to use
and operate the Premises and all of its respective facilities
thereon in material compliance with all Environmental Laws except
where noncompliance, taken singly or with all other instances of
noncompliance, has neither resulted nor would, more likely than
not, result in a Material Adverse Effect. The Grantor will and
will cause the Operator to keep all necessary Environmental Permits
in effect and remain in material compliance therewith, and handle
all Hazardous Materials in compliance with all applicable
Environmental Laws except where noncompliance, when taken singly or
with all other instances of noncompliance, has neither resulted nor
would, more likely than not, result in a Material Adverse Effect.
The Grantor shall not, and shall not permit the Operator, to suffer
to exist an environmental condition which, when taken singly or
with all other such conditions, has resulted or would, more likely
than not, result in a Material Adverse Effect. The Grantor shall
promptly resolve any noncompliance with Environmental Laws and keep
the Premises property free of any Lien imposed by any Environmental
Law which individually or in the aggregate has resulted or would,
more likely than not, result in a Material Adverse Effect.
(d) The Grantor shall conduct, or cause the Operator to
conduct, such investigation, study, sampling and testing, and
undertake, or cause the Operator to undertake, such cleanup,
removal, remedial or other action as may be necessary to comply
with all applicable Environmental Laws and any final orders or
directives of all governmental authorities; provided however, that,
this section shall not apply to any noncompliance with any such
orders or directives if and to the extent that the same shall be
contested in good faith by timely and appropriate proceedings which
are effective to stay enforcement thereof and against which
appropriate reserves have been established.
6.3 Right of Entry. In addition to all rights of entry
contained in this Deed of Trust, the Beneficiary shall have the
right to enter and inspect the condition of the Premises at any
reasonable time and to conduct, or to designate a representative to
conduct such inspection, testing, environmental audit or other
procedures that the Beneficiary believes are necessary or desirable
to determine current compliance with the covenants and
representations contained herein.
6.4 Obligations of the Beneficiary and the Banks. Nothing
contained in this Article 6 shall obligate the Beneficiary or any
of the Banks to take any action with respect to the Premises, any
Hazardous Materials thereon, or any condition or activity that is
in violation of Environmental Laws or to take any action against
any person with respect to such substances, condition or activity.
6.5 Indemnification Provisions.
(a) The Grantor hereby covenants and agrees, at its sole
cost and expense, to indemnify, protect, defend and save harmless
each and every Indemnitee from and against any and all damages,
losses, liabilities, obligations, penalties, claims, litigation,
demands, defenses, judgments, suits, actions, proceedings, costs,
disbursements and/or expenses (including, without limitation,
attorneys' and experts' fees, expenses and disbursements) of any
kind or nature whatsoever which may at any time be imposed upon,
incurred by or asserted or awarded against any Indemnitee relating
to, resulting from or arising out of (i) Environmental Claims or
(ii) a material misrepresentation or inaccuracy in any
representation or warranty or a material breach of or failure to
perform any covenant made by the Grantor in this Deed of Trust.
(b) The liability of the Grantor to each Indemnitee
hereunder shall in no way be limited, abridged, impaired or
otherwise affected by (i) any amendment or modification of the Loan
Documents by or for the benefit of the Grantor or any subsequent
owner of the Premises, (ii) any extensions of time for payment or
performance of all or any portion of the Indebtedness or any other
person from the performance or observance of any of the agreements,
covenants, terms or conditions contained in the Loan Documents or
this Deed of Trust by operation of law, the Beneficiary's voluntary
act or otherwise, (iii) the invalidity or unenforceability of any
of the terms or provisions of the Loan Documents, (iv) any
exculpatory provision contained in the Loan Documents limiting the
Beneficiary's or the Banks' recourse to the Premises or to any
other security in the Indebtedness or limiting the Beneficiary's or
the Banks' rights to a deficiency judgment against the Grantor, (v)
any applicable statute of limitations, (vi) any investigation or
inquiry conducted by or on behalf of the Beneficiary or any other
Indemnitee or any information which the Beneficiary or any other
Indemnitee may have or obtain with respect to the environmental or
ecological condition of the Premises, (vii) the sale, assignment or
foreclosure of the Indebtedness or this Deed of Trust, (viii) the
sale, transfer or conveyance of all or part of the Premises, (ix)
the dissolution or liquidation of the Grantor, (ix) the release or
discharge, in whole or in part, of the Grantor, in any bankruptcy,
insolvency, reorganization, arrangement, readjustment, composition,
liquidation or reorganization, arrangement, readjustment,
composition, liquidation or similar proceeding or (xi) any other
circumstances which might otherwise constitute a legal or equitable
release or discharge, in whole or in part, of the Grantor under the
Loan Documents or under this Deed of Trust.
ARTICLE 7 - SECURITY AGREEMENT
This Deed of Trust is hereby deemed to be as well a
security agreement for the purpose of creating a security interest
in and to all personal property owned by Grantor and comprising the
Premises (hereinafter the "Collateral") securing the Indebtedness.
This Deed of Trust also constitutes a financing statement with
respect to any and all property included in the Premises which is
or may become fixtures. Without derogating any of the provisions
of this Deed of Trust, the Grantor by this Deed of Trust:
(a) grants to the Beneficiary a security interest in all
of the Grantor's right, title and interest in and to all
Collateral, including, but not limited to, the items referred to
above, together with all additions, accessions and substitutions
and all similar property hereafter acquired and used or obtained
for use on, or in connection with the Premises, and together with
the proceeds of the Collateral, which are intended to be hereby
secured; however, such intent shall never constitute an expressed
or implied consent on the part of the Beneficiary or any of the
Banks to the sale of any or all of the Collateral;
(b) agrees that the security interest hereby granted by
this Deed of Trust shall secure the payment of the Indebtedness,
including any judgment, order or decree on the same;
(c) except as permitted in the Credit Agreement, agrees
not to sell, convey, mortgage or grant a security interest in, or
otherwise dispose of or encumber, any of the Collateral or any of
the Grantor's right, title or interest therein without first
securing Beneficiary's written consent; and the Beneficiary may, at
its sole option, require the Grantor to apply the proceeds from the
disposition of Collateral in reduction of the Indebtedness hereby
secured; provided, however, that the Beneficiary agrees to
terminate its interest with respect to any Collateral which is
either (i) sold in accordance with the terms of Section 5.04(a) of
the Credit Agreement or (ii) sold with the Beneficiary's prior
written consent;
(d) except as expressly permitted in the Credit
Agreement, agrees that if any of the Grantor's rights in the
Collateral are voluntarily or involuntarily transferred, whether by
sale, creation of a security interest, attachment, levy,
garnishment or other judicial process, without the prior written
consent of the Beneficiary, such transfer shall constitute an Event
of Default by the Grantor under the terms of this Deed of Trust;
(e) agrees that upon or after the occurrence of any
Event of Default hereunder, the Banks may, with or without notice
to the Grantor, but subject to the provisions of the Credit
Agreement (including the notice requirement set forth in Section
6.02 thereof), exercise their rights to declare all Indebtedness
secured by the security interest created hereby immediately due and
payable, in which case the Beneficiary shall have all rights and
remedies granted by law and more particularly the Uniform
Commercial Code as adopted by the State (as the same may be
amended, revised, supplemented, substituted or replaced from time
to time, the "Code"), including, but not limited to, the right to
take possession of the Collateral, and for this purpose may enter
upon any premises on which any or all of the Collateral is situated
without being deemed guilty of trespass and without liability for
damages thereby occasioned, and take possession of and operate said
Collateral or remove it therefrom. The Beneficiary shall have the
further right to take any action it deems necessary, appropriate or
desirable, at its option and in its discretion, to repair,
refurbish or otherwise prepare the Collateral for sale, lease or
other use or disposition, and to sell at public or private sales or
otherwise dispose of, lease or utilize the Collateral or any part
thereof in any manner authorized or permitted by law and to apply
the proceeds thereof toward payment of any costs and expenses
(including reasonable attorneys' fees and legal expenses, to the
extent permitted by law) thereby incurred by the Beneficiary and
toward payment of the Indebtedness, in such order and manner as the
Beneficiary may elect. Any notice given by the Beneficiary as
provided herein at least ten (10) days before the time of sale or
disposition shall be deemed reasonable and shall fully satisfy any
requirements for giving of said notice;
(f) agrees, to the extent permitted by law and without
limiting any rights and privileges herein granted to the
Beneficiary, that upon the occurrence of an Event of Default the
Beneficiary may dispose of any or all of the Collateral at the same
time and place upon giving the same notice provided for in this
Deed of Trust, and in the same manner as the nonjudicial
foreclosure sale provided under the terms and conditions of this
Deed of Trust;
(g) authorizes the Beneficiary to file, in the
jurisdiction where this Deed of Trust will be given effect, one or
more financing or continuation statements and amendments thereto,
relative to all or any part of the Collateral without the signature
of the Grantor where permitted by law (a carbon, photographic or
other reproduction of this Deed of Trust or any financing statement
covering the Collateral or any part thereof shall be sufficient as
a financing statement where permitted by law); and
(h) acknowledges that the Grantor as of the date hereof,
has joined the Beneficiary in the execution of one or more
financing statements, to be filed in accordance with the provisions
of the Code.
ARTICLE 8 - DEFAULTS AND REMEDIES
8.1 Default. Any of the following occurrences or acts shall
constitute an Event of Default ("Event of Default") under this Deed
of Trust: (i) the Grantor shall fail to pay the Indebtedness or any
Obligation when due or when declared due in accordance with the
Credit Agreement prior to the expiration of the cure or grace
period applicable thereto, if any; (ii) the Grantor shall fail to
observe or perform any of its covenants, agreements or obligations
under Sections 4.6, 4.7, 4.12, 4.13(b) or 4.17 of this Deed of
Trust; (iii) the Grantor shall fail to observe or perform any of
its covenants, agreements or obligations under Sections 4.2, 4.3 or
6.2 of this Deed of Trust and shall fail to cure such failure
within ten (10) Business Days; (iv) the Grantor shall fail to
observe or perform any of its covenants, agreements or obligations
under any provision of this Deed of Trust not specifically set
forth in clauses (i), (ii) or (iii) above within thirty (30)
Business Days after the giving of written notice to the Grantor by
any Bank that it is to be remedied; (v) an Event of Default as
defined in the Credit Agreement shall occur and shall continue
uncured after the expiration of the cure or grace period applicable
thereto, if any; or (vi) any representation, warranty or statement
(other than any made by any Bank or the Beneficiary pursuant to the
Credit Agreement or any Related Writing) made in this Deed of Trust
shall be false or erroneous in any respect when made or deemed
made, as the case may be.
8.2 Acceleration of Maturity; Remedies. Upon the occurrence
of an Event of Default, at the option of the Banks, in accordance
with the provisions of the Credit Agreement, the whole Indebtedness
hereby secured shall become immediately due and payable, although
the period specified for the payment thereof may not have expired,
anything contained in this Deed of Trust to the contrary
notwithstanding, and thereupon or at any time during the existence
of such Event of Default, the Beneficiary may proceed to foreclose
this Deed of Trust or otherwise pursue any other right or remedy
available under this Deed of Trust, at law or in equity, including,
but not limited to, the rights and remedies set forth in Article 7
hereof and in Sections 8.3 through 8.9 below.
8.3 Power of Sale. Upon the occurrence of an Event of
Default, the Beneficiary is hereby granted the right, if and to the
extent permitted by law, to sell or cause to be sold at public
auction the Premises and to convey the same by the execution and
delivery to the purchaser at such sale of good and sufficient deeds
and instruments of conveyance in law, pursuant to the statute in
such case made and provided, and out of the proceeds of such sale
to retain the moneys due under the terms of this Deed of Trust, the
costs and charges of such sale and also the attorneys' fees, if and
to the extent required by law, rendering the surplus moneys (if
any) to the Grantor.
8.4 Performance By the Beneficiary. The Grantor hereby
agrees that in the event the Grantor shall fail to comply with any
or all of its covenants, agreements, conditions and stipulations
herein set forth and such failure becomes an Event of Default, then
the Beneficiary shall be and hereby is authorized and empowered at
its option, but without legal obligation so to do, to pay and/or
perform the same without waiver of any other remedy, including,
without limitation, payment and/or performance (i) of any unpaid
obligation secured by any lien on the Premises and all or any part
of any unpaid Taxes; (ii) to effect insurance on the Premises in
the amounts required hereunder; and (iii) to enter or have its
agents enter upon the Premises whenever necessary for the purpose
of inspecting the Premises and curing any Event of Default. The
Grantor agrees that the Beneficiary and the Banks shall thereupon
have a claim against the Grantor for all sums paid by the
Beneficiary for such Taxes, insurance, rents and defaults cured,
together with a lien upon the Premises for the sum so paid plus
Default Rate. The Beneficiary, in making any payment herein as
hereby authorized in the place and stead of the Grantor relating to
(i) Taxes, may do so according to any bill, statement or estimate
procured from the appropriate public office without inquiry into
the validity of any Tax, sale forfeiture, tax lien or title or
claim thereof; or (ii) any adverse title, lien, statement of lien,
encumbrance, claim or charge, shall be the sole judge of the
legality or validity of same; or (iii) any other purpose herein and
hereby authorized, but not enumerated in this Section, may do so
whenever, in its good faith judgment and discretion, such advance
or advances shall seem necessary or desirable to protect the full
security intended to be created by this Deed of Trust, and provided
further that in connection with any advance, the Beneficiary, in
the event of apparent or thereafter adverse title, lien or
encumbrance, or foreclosure, by the Beneficiary or any other lien
claimant, at its option, may and is hereby authorized to obtain a
continuation report of title prepared by a title insurance company,
the cost and expense of which shall be repayable by the Grantor
upon demand and shall be hereby secured.
8.5 Appointment of Receiver. In the event an action shall
be instituted to foreclose this Deed of Trust, or prior to
foreclosure but after the occurrence of an Event of Default, the
Beneficiary shall be entitled to the appointment of receiver of the
rents, issues and profits of the Premises as a matter of right and
without notice, with power to collect the rents, issues and profits
of the Premises due and becoming due during the period of default
and/or the pendency of such foreclosure suit to and including the
date of confirmation of the sale under such foreclosure and during
the redemption period, if any, after such confirmation, such rents
and profits being hereby expressly assigned and pledged as security
for the payment of the Indebtedness secured by this Deed of Trust
without regard to the value of the Premises or the solvency of any
person or persons liable for the payment of the Indebtedness and
regardless of whether the Beneficiary and the Banks have an
adequate remedy at law. The Grantor for itself and for any
subsequent owner of the Premises hereby waives any and all defenses
to the application for a receiver as above provided and hereby
specifically consents to such appointment without notice, but
nothing herein contained is to be construed to deprive the holder
of this Deed of Trust of any other right, remedy or privilege it
may now have under the law to have a receiver appointed. The
provision for the appointment of receiver and the assignment of
such rents, issues and profits is made an express condition upon
which the loans hereby secured are made. In such event, the court
shall at once on application of the Beneficiary or its attorney in
such action, ex parte and without notice, appoint a receiver to
take immediate possession of, manage and control the Premises, for
the benefit of the holder or holders of the Indebtedness and of any
other parties in interest, with power to collect the rents and
profits of the Premises during the pendency of such action, and to
apply the same toward the payment of the Indebtedness,
notwithstanding that the Premises or any part thereof is occupied
by the Grantor or any other person. The rights and remedies herein
provided for shall be deemed to be cumulative and in addition to,
and not in limitation of, those provided by law; and if there be no
receiver so appointed, the Beneficiary itself may proceed to
collect the rents, issues and profits from the Premises. From any
said rents, issues and profits collected by the receiver or by the
Beneficiary prior to a foreclosure sale shall be deducted the cost
of collection thereof and the expenses of operation of the
Premises, including but not limited to real estate commissions, the
receiver's fee and the reasonable fees of its attorney, if any, the
Beneficiary's attorney's fees, if permitted by law, and court
costs; the remainder shall be applied against the Indebtedness
hereby secured. In the event such rents, issues and profits and
other income are not adequate to pay all Taxes and other expenses
of operation, the Beneficiary may, but shall not be obligated to,
advance to any receiver the amounts necessary to operate, maintain
and repair the Premises and any such amounts so advanced, together
with interest thereon at the Default Rate from and after the date
of advancement, shall be secured by this Deed of Trust and have the
same priority of collection as the Indebtedness.
8.6 Rights and Powers of Trustee; Sale of the Premises after
Default.
(a) If Grantor shall default hereunder, Grantor hereby
authorizes and empowers the Trustee (or in case of his death,
inability, refusal to act or absence from ___________ County,
Missouri, when any advertisement and sale are to be made hereunder,
then, whoever shall be sheriff of _____________ County, Missouri,
at the time when any such advertisement and sale are to be made,
who shall thereupon for the purpose of that advertisement and sale
succeed to the Trustee's title to the Premises and the trust herein
created respecting the same), may proceed to sell the Premises, and
any and every part thereof, at public vendue, to the highest
bidder, at the front door of the ______ County Circuit Court House
in _____________ in the County of ___________, State of Missouri
aforesaid, for cash, first giving twenty (20) days public notice of
the time, terms and place of sale, and of the property to be sold,
by advertisement in some newspaper printed and published in
_____________ County, Missouri, and any other notice required by
Missouri law, and upon such sale shall execute and deliver a deed
of conveyance of the property sold to the purchaser or purchasers
thereof, and any statement or recital of fact in such deed in
relation to the nonpayment of money hereby secured to be paid,
existence of the Indebtedness so secured, notice by advertisement,
sale, receipt of money, and the happening of any of the aforesaid
events whereby the sheriff may become successor as herein provided,
shall be prima facie evidence of the truth of such statement or
recital; and Trustee shall receive the proceeds of said sale out of
which he shall pay, first the cost and expenses of executing this
trust, including compensation to the Trustee, for his services and
next to Beneficiary, upon the usual vouchers therefor, all monies
paid for insurance or taxes and judgments upon statutory liens,
claims and interest thereon as hereinbefore provided for; and next
all interest, then due and unpaid; and next the principal of the
Indebtedness, with interest up to the time of such payment; and the
balance of such proceeds, if any, shall be paid to the Grantor.
Notwithstanding the foregoing provisions of this paragraph, notice
of such sale given in accordance with the requirements of the
applicable law of the State of Missouri in effect at the time of
such sale shall constitute sufficient notice of such sale. Trustee
covenants to faithfully perform the trust herein created. Grantor
hereby authorizes and empowers the Trustee to sell all or any
portion of the Premises, together or in lots or parcels, as the
Trustee may deem expedient, and to execute and deliver to the
purchaser or purchasers of such property, good and sufficient deeds
of conveyance of fee simple title with covenants of general
warranty made on behalf of the Grantor. Payment of the purchase
price to the Trustee shall satisfy the obligation of the purchaser
at such sale therefor, and such purchaser shall not be bound to
look after the application thereof. The sale or sales by the
Trustee of less than the whole of the Premises shall not exhaust
the power of sale herein granted, and the Trustee is specifically
empowered to make successive sale or sales under such power until
the whole of the Premises shall be sold; and if the proceeds of
such sale or sales of less than the whole of such Premises shall be
less than the aggregate of the Indebtedness secured hereby and the
expense of executing this trust, this Deed of Trust and the lien,
security interest and assignment hereof shall remain in full force
and effect as to the unsold portion of the Premises just as though
no sale or sales had been made; provided, however, that Grantor
shall never have any right to require the sale or sales of less
than the whole of the Premises, but Beneficiary shall have the
right, at its sole election, to request the Trustee to sell less
than the whole of the Premises. If default is made hereunder, the
holder of the Indebtedness or any part thereof on which the payment
is delinquent shall have the option to proceed with foreclosure in
satisfaction of such item either through judicial proceedings or by
directing the Trustee to proceed as if under a full foreclosure
conducting the sale as herein provided without declaring the entire
Indebtedness secured hereby due, and if sale is made because of
default of an installment, or a part of an installment, such sale
may be made subject to the unmatured part of the Note and other
Indebtedness secured by this Deed of Trust; and it is agreed that
such sale, if so made, shall not in any manner affect the unmatured
part of the Indebtedness secured by this Deed of Trust, but as to
such unmatured part, this Deed of Trust shall remain in full force
and effect as though no sale had been made under the provisions of
this paragraph. Several sales may be made hereunder without
exhausting the right of sale for any unmatured part of the
Indebtedness secured hereby.
(b) Grantor hereby agrees, in its behalf and in behalf
of its successors and assigns, that any and all statements of fact
or other recitals made in any deed of conveyance given by the
Trustee, with respect to the identity of Beneficiary or Grantor, or
with respect to the occurrence or existence of any default, or with
respect to the acceleration of the maturity of the Indebtedness
secured hereby, or with respect to the request to sell, the notice
of sale, the giving of notice to all debtors legally entitled
thereto, the time, place, terms and manner of sale, and receipt,
distribution, and application of the money realized therefrom, or
with respect to the due and proper appointment of a substitute
Trustee, and, without being limited by the foregoing, with respect
to any other act or thing having been duly done by the Beneficiary
or by the Trustee hereunder, shall be taken by all courts of law
and equity as prima facie evidence that the statements or recitals
state facts and are without further question to be so accepted, and
Grantor hereby ratifies and confirms every act that Trustee or any
substitute trustee hereunder may lawfully do in the Premises by
virtue hereof. The purchaser at any trustee's or foreclosure sale
hereunder may disaffirm any easement granted, or rental, lease or
other contract made in violation of any provision of this Deed of
Trust, and may take immediate possession of the Premises free from,
and despite the terms of, such grant of easement and rental or
lease contract. Beneficiary may bid and become the purchaser of
all or any part of the Premises at any trustee's or foreclosure
sale hereunder. If any of the Indebtedness hereby secured shall
not be paid when due and payable (after the lapse of any applicable
grace period), the Trustee or the Beneficiary shall have the right
and power to proceed by a suit or suits in equity or at law,
whether for the specific performance of any covenant or agreement
herein contained or in aid of the execution of any power herein
granted, or for any foreclosure hereunder or for the sale of the
Premises under the judgment or decree of any court or courts of
competent jurisdiction, or for the appointment of a receiver
pending any foreclosure hereunder or the sale of the Premises under
the order of a court or courts of competent jurisdiction or under
executory or other legal process, or for the enforcement of any
other appropriate legal or equitable remedy. The Grantor agrees,
to the full extent that it lawfully may, that in case one or more
or the defaults hereunder shall have occurred and shall not have
been remedied, then, and in every such case, the Beneficiary shall
have the right and power to enter into and upon and take possession
of all or any part of the Premises in the possession of the
Grantor, its successors or assigns, or its or their agents or
servants, and may exclude the Grantor, its successors or assigns,
and all persons claiming under the Grantor, and its or their agents
or servants, wholly or partly therefrom; and, holding the same, the
Beneficiary may use, administer, manage, operate and control the
Premises and conduct the business thereof, to the same extent as
the Grantor, its successors or assigns, might at the time do and
may exercise all rights and powers of the Grantor, in the name,
place and stead of the Grantor, or otherwise of any of the
foregoing rights and powers Beneficiary shall not be liable to
Grantor for any loss or damage thereby sustained unless due solely
to the willful misconduct or gross negligence of Beneficiary.
(c) In the event a foreclosure hereunder shall be
commenced by the Trustee, or his substitute or successor, the
Beneficiary may at any time before the sale of the Premises direct
the Trustee to abandon the sale, and may then institute suit for
the collection of the Indebtedness, and for the foreclosure of this
Deed Of Trust. It is agreed that if the Beneficiary should
institute a suit for the collection of the Indebtedness and for the
foreclosure of this Deed of Trust, the Beneficiary may at any time
before the entry of a final judgment in said suit dismiss the same,
and require the Trustee, his substitute or successor to sell the
Premises in accordance with the provisions of this Deed of Trust.
(d) The Beneficiary shall have the right to become the
purchaser at any sale held by any Trustee or substitute or
successor or by any receiver or public officer, and Beneficiary
purchasing at any such sale shall have the right to credit upon the
amount of the bid made therefor, to the extent necessary to satisfy
such bid, the Indebtedness owing to the Beneficiary, or if
Beneficiary holds less than all of such indebtedness the pro rata
part thereof owing to the Beneficiary.
Resignation and Substitution of Trustee; Liability of
Trustee.
(a) The Trustee may resign by an instrument in writing
addressed to the Beneficiary, or the Trustee may be removed at any
time with or without cause by an instrument in writing executed by
the Beneficiary. In case of the death, resignation, removal or
disqualification of the Trustee or if for any reason the
Beneficiary shall deem it desirable to appoint a substitute or
successor trustee to act instead of the herein named trustee or any
substitute or successor trustee, then the Beneficiary shall have
the right and is hereby authorized and empowered to appoint a
successor trustee, or a substitute trustee, without other formality
than appointment and designation in writing executed by the
Beneficiary and the authority hereby conferred shall extend to the
appointment of other successor and substitute trustees successively
until the Indebtedness secured hereby has been paid in full or
until the Premises is sold hereunder. If the Beneficiary is a
corporation and such appointment is executed in its behalf by an
officer of such corporation, such appointment is executed in its
behalf by an officer of such corporation, such appointment shall be
conclusively presumed to be executed with authority and shall be
valid and sufficient without proof of any action by the board of
directors or any superior officer of the corporation. Upon the
making of any such appointment and designation, all of the estate
and title of the Trustee in the Premises shall vest in the named
successor or substitute trustee and he or it shall thereupon
succeed to and shall hold, possess and execute all the rights,
powers, privileges, immunities and duties herein conferred upon the
Trustee, and shall duly assign, transfer and deliver any of the
properties and monies held by said Trustee hereunder to said
successor or substitute Trustee. All references herein to the
Trustee shall be deemed to refer to the Trustee (including any
successor or substitute appointed and designated as herein
provided) from time to time acting hereunder. Grantor hereby
ratifies and confirms any and all acts which the herein named
Trustee or his successor or successors, substitute or substitutes
in this trust, shall do lawfully by virtue hereof.
(b) The Trustee shall not be liable for any error of
judgment or act done by the Trustee in good faith, or be otherwise
responsible or accountable under any circumstances whatsoever,
except for the Trustee's gross negligence or willful misconduct.
The Beneficiary shall have the right to rely on any instrument,
document or signature authorizing or supporting any action taken or
proposed to be taken by him hereunder, believed by him in good
faith to be genuine. All monies received by the Trustee shall,
until used or applied as herein provided, be held in trust for the
purposes for which they were received, but need not be segregated
in any manner from any other monies (except to the extent required
by law), and the Trustee shall be under no liability for interest
on any monies received by him hereunder. Grantor will reimburse
the Trustee for, and indemnify and save him harmless against, any
and all liability and expenses which may be incurred by him in the
performance of his duties hereunder.
8.8 Remedies Non-Exclusive. Each remedy or right of the
Beneficiary and the Banks shall not be exclusive of but shall be in
addition to every other remedy or right now or hereafter existing
at law or in equity. No delay in the exercise or omission to
exercise any remedy or right accruing on any Event of Default
hereunder shall impair any such remedy or right or be construed to
be a waiver of any such Event of Default or acquiescence therein,
nor shall it affect any subsequent Event of Default of the same or
different nature. Every such remedy or right may be exercised
concurrently or independently and when and as often as may be
deemed expedient by the Beneficiary and the Banks.
8.9 Execution of Judgment. If more than one property, lot,
parcel, estate or interest is covered by this Deed of Trust, and if
this Deed of Trust is foreclosed upon, or judgment is entered upon
any obligation hereby secured, execution may be made upon any one
or more of the properties, lots, estates, parcels or interests and
not upon the others, or upon all of such properties or parcels,
either together or separately, and at different times or at the
same time, and execution sales may likewise be conducted separately
or concurrently, in each case at the Beneficiary's election.
8.10 Fees Payable on Foreclosure. In case of foreclosure of
this Deed of Trust in any court of law or equity, whether or not
any order or judgment has been entered therein, and to the extent
permitted by law, a reasonable sum as aforesaid shall be allowed
for attorney's fees of the plaintiff in such proceedings, for
stenographer's fees and for all moneys expended for documentary
evidence and the cost of a complete abstract of title and title
report for the purpose of such foreclosure, such sums to be secured
by the lien of this Deed of Trust; and, to the extent permitted by
law, there shall be included in any judgment or decree foreclosing
this Deed of Trust and be paid out of said rents, issues and
profits or out of the proceeds of any sale made in pursuance of any
such judgment or decree: (i) all costs and expenses of such suit or
suits, advertising, sale and conveyance, including attorneys' fees
and stenographer's fees, if and to the extent permitted by law,
outlays for documentary evidence and the cost of said abstract,
examination of title and title report; (ii) all moneys advanced by
the Beneficiary, if any, for any purpose authorized in this Deed of
Trust with interest as herein provided; (iii) all the accrued
interest remaining unpaid on the Indebtedness; and (iv) the
Indebtedness.
ARTICLE 9 - ASSIGNMENT OF LEASES AND RENTS
The Grantor hereby absolutely and unconditionally assigns
to the Beneficiary all of its interest as lessor with respect to
all existing and future leases of the Premises (including, without
limitation, the Operator Lease). This assignment is a present
assignment of the Grantor's interest in all such leases and to the
rents and profits thereunder as additional collateral for the
Indebtedness hereby secured. This assignment of leases and rents
is a present, absolute and irrevocable assignment and is made to
secure and enforce the payment of the Indebtedness. The Grantor
hereby irrevocably grants to the Beneficiary the present and
continuing right, coupled with an interest, to collect such rents
and to enforce such leases and to enter and possess the Premises
for such purposes. However, the Beneficiary hereby conditionally
waives such right, and grants to the Grantor the revocable license
to collect and to enforce the same, provided, however, that said
waiver and such license of the Grantor to collect such rents and to
enforce such leases may, after the occurrence of an Event of
Default, be revoked by the Beneficiary at any time by giving notice
of such revocation to the Grantor. All rents collected by the
Grantor after the giving of such notice of revocation by the
Beneficiary shall be held by the Grantor as a trust fund for the
Beneficiary. Following such notice of revocation, the Beneficiary
may retain and apply the rents toward payment of the Indebtedness
in such order and manner as the Beneficiary may elect.
ARTICLE 10 - GENERAL
10.1 No Waiver. No sale of the Premises, no forbearance on
the part of the Beneficiary or the Banks, no extension of the time
for the payment of the Indebtedness or any change in the terms
thereof consented to by the Beneficiary or any of the Banks shall
in any way whatsoever operate to release, discharge, modify, change
or affect the original liability of the Grantor herein, either in
whole or in part. No waiver by the Beneficiary of any breach of
any covenant of the Grantor herein contained shall be construed as
a waiver of any subsequent breach of the same or any other covenant
herein contained. The failure of the Beneficiary to exercise the
option for acceleration of maturity and/or foreclosure (including
sale under power of sale hereunder) following any Event of Default
hereunder or to exercise any other option granted to the
Beneficiary and the Banks hereunder in any one or more instances,
or the acceptance by the Beneficiary and the Banks of partial
payments hereunder shall not constitute a waiver of any such Event
of Default, nor extend or affect the grace period, if any, but such
option shall remain continuously in force with respect to any
unremedied or uncured Event of Default. Acceleration of maturity
once claimed in accordance with the Credit Agreement may, at the
option of the Beneficiary and the Banks in accordance with the
Credit Agreement, be rescinded by written acknowledgment to that
effect by the Beneficiary, but the tender and acceptance of partial
payments alone shall not in any way affect or rescind such
acceleration of maturity, or extend or affect the grace period, if
any. The Beneficiary and the Banks may pursue their rights without
first exhausting their rights hereunder and all rights, powers and
remedies hereby conferred upon the Beneficiary and the Banks are in
addition to each and every right which the Beneficiary and the
Banks may have hereunder at law or equity, and may be enforced
concurrently therewith.
10.2 Legal Proceedings. If any action or proceeding be
commenced, to which action or proceeding the Beneficiary or any of
the Banks is made a party by reason of the execution of this Deed
of Trust or the Indebtedness or in which it becomes necessary to
defend or uphold the lien of this Deed of Trust, or the priority
thereof or possession of the Premises, or otherwise to perfect the
security hereunder, or in any suit, action, legal proceeding or
dispute of any kind in which the Beneficiary or any of the Banks is
made a party or appears as party plaintiff or defendant, affecting
the Credit Agreement, the Loan Documents, the Indebtedness, this
Deed of Trust, or the interest created herein, or the Premises,
including, but not limited to, bankruptcy, probate and
administration proceedings, foreclosure of this Deed of Trust or
any condemnation action involving the Premises, all reasonable sums
paid by the Beneficiary or any of the Banks for the expense of any
litigation to prosecute and defend the rights and liens created
hereby shall be paid by the Grantor to the Beneficiary, together
with interest thereon from the date of payment at the rate of
interest then applicable under the Credit Agreement. Any such sum
and the interest thereon shall be immediately due and payable and
be hereby secured, having the benefit and priority of the lien
hereby created.
10.3 Subrogation. Should the proceeds of the Indebtedness,
the repayment of which is hereby secured, or any part thereof, or
any amount paid out or advanced by the Beneficiary, be used
directly or indirectly to pay off, discharge, or satisfy, in whole
or in part, any prior lien or encumbrance upon the Premises or any
part thereof, then the Beneficiary and the Banks shall be
subrogated to such other liens or encumbrances and to any
additional security held by the holder thereof and shall have the
benefit of the priority of all of the same.
10.4 Release and Partial Release. The Grantor agrees, without
affecting the liability of any person for payment of the
Indebtedness hereby secured or affecting the lien of this Deed of
Trust upon the Premises or any part thereof (other than persons or
property explicitly released as a result of the exercise by the
Beneficiary of its rights and privileges hereunder), that the
Beneficiary, without notice, and without regard to the
consideration, if any, paid therefor, and notwithstanding the
existence at that time of any inferior liens thereon, may release
as to itself and this Deed of Trust any part of the security herein
described or any person liable for the Indebtedness (or any part
thereof) hereby secured, without in any way affecting the priority
of the lien of this Deed of Trust to the full extent of the
Indebtedness remaining unpaid upon any part of the security not
expressly released, and may agree with any party obligated on the
Indebtedness or having any interest in the security herein
described to extend the time for payment of any part or all of the
Indebtedness hereby secured. Such agreement shall not, in any way,
release or impair the lien hereof, but shall extend the lien hereof
as against the title of all parties having any interest in said
security which interest is subject to said lien. In the event the
Beneficiary: (i) releases, as aforesaid, any part of the security
described herein or any person liable for the Indebtedness (or any
part thereof) hereby secured, (ii) grants an extension of time for
any payments of the Indebtedness hereby secured, (iii) takes other
or additional security for the payment thereof, or (iv) waives or
fails to exercise any right granted herein or in the Credit
Agreement, or the Loan Documents, no such act or omission shall
release the Grantor, subsequent purchasers of the Premises or any
part thereof, or makers or sureties of this Deed of Trust under any
covenant of this Deed of Trust or preclude the Beneficiary or any
of the Banks from exercising any right, power or privilege herein
granted or intended to be granted with respect to any other Event
of Default then made or any subsequent Event of Default.
10.5 Subordination.
(a) The Operator Lease and Operator's rights under the
Lease are subordinate to this Deed of Trust, together with any
renewal, consolidation, extension, modification, or replacement
thereof, which now or at any time affects the Premises or any
interest of the Grantor in the Premises. By acceptance of this
Deed of Trust, the Beneficiary agrees that the Beneficiary shall
have no right to disturb Operator's possession, use and occupancy
of the Premises or Operators's enjoyment of its rights under the
Lease unless and until a Lease Default shall occur under the
Operator Lease. Any foreclosure action with respect to this Deed
of Trust shall not affect Operator's rights under the Operator
Lease unless and until a Lease Default occurs. The foregoing
provisions will be self-operative, and no further instrument will
be required in order to effect them. However, the Grantor shall
cause Operator to execute, acknowledge and deliver at any time and
from time to time upon demand by the Beneficiary or any other
holder of this Deed of Trust, such documents as may be requested by
the Beneficiary or any other holder of this Deed of Trust to
confirm or effect such subordination, provided that any such
document shall include a non-disturbance provision as set forth in
this Section satisfactory to Operator.
(b) Notwithstanding the provisions of Subparagraph (a)
above, at the option of the Beneficiary, this Deed of Trust shall
become subject and subordinate in whole or in part (but not in
respect to the priority of entitlement to insurance proceeds or any
award in condemnation) to any or all leases and/or subleases
(including, without limitation, the Operator Lease) of all or any
part of the Premises, upon the execution by the Beneficiary and
recording thereof, at any time hereafter, in the Office of the
County Recorder where the Premises are situated, a unilateral
declaration to that effect.
10.6 Waiver of Homestead Rights and Appraisement. To the
extent permitted by law with respect to the Indebtedness and any
renewals or extensions thereof, the Grantor waives, relinquishes
and renounces any and all homestead and exemption rights and all
benefit of any and every law now or hereafter in force to exempt
from levy and sale, as well as the benefit of all valuation and
appraisement privileges and moratoria under or by virtue of the
constitution and laws of the State or any other state or of the
United States, now existing or hereafter enacted.
10.7 Covenants to Run with the Land. All the covenants
hereof shall run with the land.
10.8 No Claims Against Beneficiary or the Banks. Nothing
contained in this Deed of Trust shall constitute any request by the
Beneficiary or any of the Banks, express or implied, for the
performance of any labor or services or the furnishing of any
materials or other property in respect of the Premises or any part
thereof, or be construed to give the Grantor any right, power or
authority to contract for or permit the performance of any labor or
services or the furnishing of any materials or other property in
such fashion as would provide the basis for any claim either
against the Beneficiary or any of the Banks or that any lien based
on the performance of such labor or services or the furnishing of
any such materials or other property prior to the lien of this Deed
of Trust.
10.9 Further Assurances. The Grantor shall execute,
acknowledge and deliver any and all such further acts, conveyances,
documents, mortgages and assurances as the Beneficiary may
reasonably require for accomplishing the purpose hereof forthwith
upon the request of the Beneficiary, whether in writing or
otherwise. If the Grantor shall not have delivered to the
Beneficiary duly executed statements or agreements referred to
hereinabove within ten (10) days of the Beneficiary's demand
therefor, the Beneficiary may file such Uniform Commercial Code
financing statements or agreements in the name of the Grantor. The
Grantor hereby appoints the Beneficiary as its attorney-in-fact in
connection with any of the applicable Premises covered by this Deed
of Trust, to execute and file on its behalf any Uniform Commercial
Code financing statements or other statements in connection
therewith with the appropriate public office. This power, being
coupled with an interest, shall be irrevocable so long as this Deed
of Trust remains in effect. The Grantor, within ten (10) days
after request by the Beneficiary, will furnish a written statement
duly acknowledged, of the amount due upon this Deed of Trust and
the Indebtedness (both unpaid principal and accrued interest) and
whether any offset or defenses exist against the Indebtedness, and
any other information which might reasonably be requested in
connection with (i) the sale of the loan by the Beneficiary or any
of the Banks to any third party or (ii) an audit of the Beneficiary
or any of the Banks, which statement expressly shall provide that
it may be relied on for such purposes.
10.10 Recordation. At the request of the Beneficiary, the
Grantor, at its expense, will cause all instruments of further
assurance requested by the Beneficiary (including, without
limitation, all necessary amendments, supplements and continuation
statements) at all times to be kept recorded, filed and registered
in such manner and in such places as may be required by law in
order fully to establish, preserve and protect the lien of this
Deed of Trust as a valid first mortgage lien on all real property,
fixtures and interests therein included in the Premises, subject
only to the Permitted Encumbrances and any other Liens permitted by
the Credit Agreement, and a valid, perfected first priority
security interest in the Collateral, subject only to the Permitted
Encumbrances and any other Liens permitted by the Credit Agreement
(including, in each such case, without limitation, any such
properties acquired after the execution hereof), and the rights of
the Beneficiary and the Banks as to the Premises. However, neither
a demand so made by the Beneficiary, nor the failure of the
Beneficiary or any of the Banks to make any such demand, shall be
construed as a release of any such Premises, or any part thereof,
from the lien of this Deed of Trust, it being understood and agreed
that this covenant and any security instrument delivered to the
Beneficiary or any of the Banks pursuant hereto are cumulative and
given as additional security.
10.11 Notices. All notices and other communications provided
for hereunder shall be in writing (including telecopier,
telegraphic, telex or cable communication) and mailed, telecopied,
telegraphed, telexed, cabled or delivered, if to the Grantor, at
its address at One SeaGate, Suite 1950, Toledo, Ohio 43604,
Attention: Ms. Erin C. Ibele; if to any Bank, at its Lending
Office specified opposite its name on Schedule I to the Credit
Agreement; and if to the Beneficiary, at its address at 1900 East
Ninth Street, Cleveland, Ohio, Attention: Metro Ohio Division or,
as to each party, at such other address as shall be designated by
such party in a written notice to each of the other parties. All
such notices and communications shall, when mailed, telecopied,
telegraphed, telexed or cabled, be effective when deposited in the
mails, telecopied, delivered to the telegraph company, confirmed by
telex answerback or delivered to the cable company, respectively,
except that notices and communications to the Beneficiary pursuant
to Article 8 shall not be effective until received by the
Beneficiary.
10.12 Governing Law. The Indebtedness secured hereby was
incurred in the State of Ohio pursuant to various documents
executed in the State of Ohio in connection with a multi-state
transaction governed by the laws of the State of Ohio. This Deed
of Trust and all substantive terms and provisions hereof shall be
governed by and construed according to the laws of the State of
Ohio, except to the extent that the creation, attachment and
enforcement of the lien of this Deed of Trust must be governed by
the laws of the State.
10.13 Conflict With Laws. If any provision(s) hereof are in
conflict with any statute or rule of law of the State, or are
otherwise unenforceable for any reason whatsoever, then such
provision(s) shall be deemed null and void to the extent of such
conflict or unenforceability, but shall be deemed separable from
and shall not invalidate any other provisions of this Deed of
Trust.
10.14 Interest Limitation. Nothing herein contained nor any
transaction related thereto shall be construed or shall so operate
either presently or prospectively to require the Grantor (a) to pay
interest at a rate greater than is now lawful in such case to
contract for, but shall require payment of interest only to the
extent of such lawful rate, or (b) to make any payment or do any
act contrary to law, but if any clause and provision herein
contained shall otherwise so operate to invalidate this Deed of
Trust, in whole or in part, then such clauses and provisions only
shall be held for naught as though not herein contained and the
remainder of this Deed of Trust shall remain operative and in full
force and effect. Any interest paid in excess of the lawful rate
shall be refunded to the Grantor. Such refund shall be paid by
application of the excessive amount of interest paid against the
Indebtedness and shall be applied in such order as the Beneficiary
may determine. If the excessive amount of interest paid exceeds
the Indebtedness, the portion exceeding the Indebtedness shall be
refunded in cash by the Beneficiary. Any such crediting or refund
shall not cure or waive any default by the Grantor hereunder or
under the Indebtedness. The Grantor agrees, however,that in
determining whether or not any interest payable under the
Indebtedness or this Deed of Trust exceeds the highest rate
permitted by law, any non-principal payment (except payments
specifically stated in the Indebtedness to be "interest"),
including without limitation prepayment premiums and late charges,
shall be deemed, to the extent permitted by law, to be an expense,
fee, premium or penalty rather than interest.
10.15 Rules of Construction. Whenever used, the singular
number shall include the plural, the plural the singular and the
use of any gender shall include all genders. Each defined term
used herein and not otherwise defined herein hall have the meaning
ascribed such term in the Credit Agreement. All of the covenants
of the Grantor herein contained are joint and several.
10.16 Successors and Assigns; Assignment. This Deed of Trust
is binding upon the Grantor, its successors and assigns, and the
rights, powers and remedies of the Beneficiary under this Deed of
Trust shall inure to the benefit of the Beneficiary and its
successors and assigns. The Grantor may not assign its obligations
or rights hereunder without the consent of the Beneficiary and each
of the Banks. Each of the Beneficiary and the Banks may assign its
rights hereunder subject to the limitations set forth in Article
VIII of the Credit Agreement.
10.17 Amendments and Waivers. No amendment or waiver of any
provision of this Deed of Trust, nor consent to any departure by
the Grantor therefrom, shall in any event be effective unless the
same shall be in writing and signed by the Majority Banks (as
defined in the Credit Agreement), and then such waiver or consent
shall be effective only in the specific instance and for the
specific purpose for which given; provided, however, that no
amendment, waiver or consent shall, unless in writing and signed by
all the Banks, do any of the following: (a) reduce the principal
of, or interest on, any fees or other amounts payable hereunder,
(b) change the method of computing of interest or any fee, (c)
release any Operator Lease Document from the operation of this Deed
of Trust other than as provided in Section 2.08 of the Credit
Agreement, (d) amend this Section 10.17 or (e) amend, modify or
waive any provision of this Deed of Trust where such provision
requires consent or waiver by all Banks or any amendment of such a
provision which would amend such requirement of consent by all
Banks; and provided, further, that no amendment, waiver or consent
shall, unless in writing and signed by the Beneficiary in addition
to the Banks required above to take such action, affect the rights
or duties of the Beneficiary under this Deed of Trust.
10.18 Waiver of Jury Trial. THE PARTIES ACKNOWLEDGE AND
AGREE THAT ANY CONTROVERSY THAT MAY ARISE UNDER THIS AGREEMENT AND
THE RELATED WRITINGS WOULD INVOLVE DIFFICULT AND COMPLEX ISSUES AND
THEREFORE AGREE THAT ANY LAW SUIT GROWING OUT OF OR INCIDENTAL TO
ANY SUCH CONTROVERSY WILL BE TRIED IN A COURT OF COMPETENT
JURISDICTION BY A JUDGE SITTING WITHOUT A JURY. THE GRANTOR
CONFIRMS THAT THE FOREGOING WAIVER IS INFORMED AND FREELY MADE.
10.19 Jurisdiction; Venue, Inconvenient Forum.
(a) EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY AND
UNCONDITIONALLY SUBMITS, FOR ITSELF AND ITS PROPERTY, TO THE
NONEXCLUSIVE JURISDICTION OF ANY OHIO STATE COURT OR FEDERAL COURT
OF THE UNITED STATED OF AMERICA SITTING IN CUYAHOGA COUNTY, OHIO,
AND ANY APPELLATE COURT FROM ANY THEREOF, IN ANY ACTION OR
PROCEEDING ARISING OUT OF OR RELATING TO THIS DEED OF TRUST, THE
CREDIT AGREEMENT, ANY COLLATERAL DOCUMENT OR ANY RELATED WRITING OR
FOR RECOGNITION OR ENFORCEMENT OF ANY JUDGMENT, AND EACH OF THE
PARTIES HERETO HEREBY IRREVOCABLY AND UNCONDITIONALLY AGREES THAT
ALL CLAIMS IN RESPECT OF ANY SUCH ACTION OR PROCEEDING MAY BE HEARD
AND DETERMINED IN ANY SUCH OHIO STATE OR, TO THE EXTENT PERMITTED
BY LAW, IN SUCH FEDERAL COURT. EACH OF THE PARTIES HERETO AGREES
THAT A FINAL JUDGMENT IN ANY SUCH ACTION OR PROCEEDING SHALL BE
CONCLUSIVE AND MAY BE ENFORCED IN OTHER JURISDICTIONS BY SUIT ON
THE JUDGMENT OR IN ANY OTHER MANNER PROVIDED BY LAW. NOTHING IN
THIS AGREEMENT SHALL AFFECT ANY RIGHT THAT ANY PARTY MAY OTHERWISE
HAVE TO BRING ANY ACTION OR PROCEEDING RELATING TO THIS DEED OF
TRUST, THE CREDIT AGREEMENT, ANY COLLATERAL DOCUMENT OR ANY RELATED
WRITING IN THE COURTS OF ANY JURISDICTION.
(b) EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY AND
UNCONDITIONALLY WAIVES, TO THE FULLEST EXTENT IT MAY LEGALLY AND
EFFECTIVELY DO SO, ANY OBJECTION THAT IT MAY NOW OR HEREAFTER HAVE
TO THE LAYING OF VENUE OF ANY SUIT, ACTION OR PROCEEDING ARISING
OUT OF OR RELATING TO THIS DEED OF TRUST, THE CREDIT AGREEMENT, ANY
COLLATERAL DOCUMENT OR ANY OTHER RELATED WRITING IN ANY OHIO STATE
OR FEDERAL COURT SITTING IN OHIO. EACH OF THE PARTIES HERETO HEREBY
WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW, THE DEFENSE OF AN
INCONVENIENT FORUM TO THE MAINTENANCE OF SUCH ACTION OR PROCEEDING
IN ANY SUCH COURT. THE GRANTOR CONFIRMS THAT THE FOREGOING WAIVERS
ARE INFORMED AND FREELY MADE.
10.20 Certain Defined Terms. As used herein, the term
"Beneficiary" means National City Bank, a national banking
association, acting in its capacity as agent for its benefit and
the ratable benefit of the Banks, together with its successors and
assigns in such capacity, and the term "Banks" means National City
Bank and certain other banks as set forth in the Credit Agreement,
and such other banks as may become parties to the Credit Agreement
from time to time, together with their respective successors and
assigns.
ARTICLE 11 - DEFEASANCE
The condition of this Deed of Trust is that if either (a)
the Grantor shall punctually pay the Indebtedness and all other
obligations hereby secured when due and owing, and shall perform
the covenants of the Grantor arising from the Indebtedness, and
shall punctually perform all of the Grantor's covenants and
agreements herein contained, or (b) the Grantor shall satisfy the
requirements of Section 2.08(b), 2.08(d) or 2.08(e) of the Credit
Agreement, this Deed of Trust shall be released by the Beneficiary,
at the cost and expense of the Grantor; otherwise the same shall
remain in full force and virtue in law. In case of failure of the
Beneficiary to so release this Deed of Trust, all claims for
statutory penalties and damages are hereby waived.
IN WITNESS WHEREOF, the Grantor has caused this Deed of
Trust to be duly executed and delivered in Cleveland, Ohio as of
the day and year first above written.
Signed and acknowledged The "Grantor"
in the presence of:
HEALTH CARE REIT, INC.
- - - ------------------------------- By:------------------------
Signature of Witness
(as to both signatures) Print Name:----------------
Print Name:-------------------- Title:---------------------
- - - ------------------------------- And:-----------------------
Signature of Witness
(as to both signatures) Print Name:----------------
Print Name:-------------------- Title:---------------------
STATE OF OHIO )
) SS:
COUNTY OF ___________ )
On this ____ day of _______, 1994, before me appeared
_________________________________ and ___________________________,
to me personally known, who, being duly sworn (or affirmed) did say
that they are the ____________________ and _____________________,
respectively, of HEALTH CARE REIT, INC., a Delaware corporation
(the "Grantor"), and that [the seal affixed to said instrument is
the corporate seal of said corporation] OR [said corporation has no
corporate seal], and that said instrument was signed and sealed in
behalf of said corporation by authority of its board of directors,
and said _____________________________ and ________________________
acknowledged said instrument to be the free act and deed of said
corporation.
IN TESTIMONY WHEREOF, I have hereunto set my hand and
official seal at Cleveland, Ohio, this ____ day of _______________,
1994.
____________________________________
Notary Public
My Commission Expires:
This instrument Prepared By:
CALFEE, HALTER & GRISWOLD
Suite 1800
800 Superior Avenue
Cleveland, Ohio 44114-2688
<PAGE>
EXHIBIT 1
TO
DEED OF TRUST (WITH ASSIGNMENT OF RENTS
AND SECURITY AGREEMENT)
Legal Description of Premises
<PAGE>
EXHIBIT 2
TO
DEED OF TRUST (WITH ASSIGNMENT OF RENTS
AND SECURITY AGREEMENT)
Permitted Encumbrances
1. Liens permitted under the Credit Agreement.
2. Real property taxes and assessments, both general and special,
which are a lien but not yet due and payable.
3. Zoning ordinances, if any.
4. Lease Agreement between the Grantor and _____________________,
dated _________________, as amended by __________________________.
EXHIBIT I
Prepared by and, after EXECUTION COPY
recording, return to:
Lynn M. Gattozzi
Calfee, Halter & Griswold
Suite 1800
800 Superior Avenue
Cleveland, Ohio 44114-2688
(216) 622-8200
[AMENDED AND RESTATED] COLLATERAL ASSIGNMENT OF
OPERATOR LOAN DOCUMENTS
THIS AMENDED AND RESTATED COLLATERAL ASSIGNMENT OF OPERATOR
LOAN DOCUMENTS (this "Assignment") is made as of this _____ day of
_____, 19__ by HEALTH CARE REIT, INC., a Delaware corporation
("Assignor"), One SeaGate, Suite 1950, Toledo, Ohio 43003, to
NATIONAL CITY BANK, a national banking association, as Agent for
its benefit and the ratable benefit of the Banks (as hereinafter
defined), their successors and assigns (together with its
successors and assigns in such capacity, "Assignee"), National City
Center, 1900 East Ninth Street, Metro Division, Cleveland, Ohio
44114.
RECITALS
WHEREAS, Assignor, as the "Borrower" has entered into that
certain Amended and Restated Credit Agreement dated as of the
effective date hereof (as the same may be supplemented, amended,
restated, modified or substituted from time to time, the "Credit
Agreement"; capitalized terms used herein without definition have
the meanings ascribed to such terms in the Credit Agreement) with
National City Bank and certain other banks as set forth in the
Credit Agreement (such banks and such other banks as may become
parties to the Credit Agreement from time to time, together with
their respective successors and assigns, all being hereinafter
collectively referred to as the "Banks") and Assignee as agent for
its benefit and the ratable benefit of the Banks (together with its
successors and assigns in such capacity hereinafter referred to as
"Assignee"), pursuant to which the Banks have agreed to loan to
Assignor up to $150,000,000 upon the terms and conditions set forth
therein [which Credit Agreement amends and restates in its entirety
that certain Credit Agreement, dated as of October 1, 1989, by and
between Assignor as "Borrower" and National City Bank as Agent for
itself and the other banks (the "Original Banks") (National City
Bank acting in such capacity is hereinafter referred to as the
"Original Agent") which are parties thereto (the "Original Credit
Agreement")];
WHEREAS, to evidence the obligations of Assignor to the Banks
under the Credit Agreement, Assignor has executed and delivered to
the Banks one or more Revolving Credit Notes dated as of the
effective date hereof in the aggregate principal amount of up to
$150,000,000 (the "Notes"), [which Notes replace the notes executed
and delivered by Assignor under the Original Credit Agreement (the
"Original Notes");]
[WHEREAS, Assignor has executed and delivered to the Original
Agent a certain collateral assignment of loan documents recorded in
Volume ___________, Page ___________, _________ County Records (the
"Original Assignment") to secure to the Original Agent for its
benefit and the ratable benefit of the Original Banks the
obligations of Assignor to the Original Agent and the Original
Banks under the Original Credit Agreement and all other instruments
and agreements evidencing or securing such obligations or otherwise
related thereto;]
[WHEREAS, the Original Agent has assigned to Assignee the
Original Credit Agreement, the Original Assignment, and all other
instruments and agreements evidencing or securing the obligations
of Assignor under the Original Credit Agreement or otherwise
related thereto;]
WHEREAS, Assignor has executed and delivered to Assignee this
Assignment to secure to Assignee the obligations of Assignor to the
Banks under the Credit Agreement, the Collateral Documents (as
defined in the Credit Agreement), and all Related Writings (as
defined in the Credit Agreement) (the Notes, the Credit Agreement,
this Assignment, the Collateral Documents and the Related Writings
are sometimes collectively referred to herein as the "Loan
Documents") [which Assignment amends and restates the Original
Assignment in its entirety;]
NOW, THEREFORE, for good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, and for
the purposes set forth below, Assignor hereby covenants and agrees
as follows:
1. Assignment. Assignor hereby grants, grants a security
interest in, bargains, sells, transfers, sets over and assigns to
Assignee, its successors and assigns, all of Assignor's right,
title and interest in, to and under all mortgages, deeds of trust,
deeds to secure debt, installment sale contracts, assignments of
rents and leases, security agreements and any other collateral
security instrument described in Exhibit A attached hereto and made
a part hereof ("Operator Loan Documents"), which Operator Loan
Documents, among other things, encumber the real property described
on Exhibit B attached hereto (the "Premises"), together with any
and all notes and obligations therein described or referred to, the
debt respectively secured thereby, and all sums of money due and to
become due thereon, and any other sums payable under the Operator
Loan Documents or the debt secured thereby; it being the intention
hereby to establish an absolute transfer and assignment to Assignee
of all Operator Loan Documents and of all of the payments and
performance due thereunder, including without limitation all such
payments and performance which are or may become due and payable or
which are or may be paid after the filing of any petition by or
against Assignor under the United States Bankruptcy Code, as
amended, 11 U.S.C. 101 et seq., or any successor statute or code or
any similar federal or state statute, code or Law (as defined in
the Credit Agreement).
2. Obligations. This Assignment secures the complete and
timely payment of all obligations of Assignor, and any other
obligor under the Loan Documents, now or hereafter existing under
the Loan Documents, whether direct or indirect, fixed or
contingent, including any extensions, modifications, substitutions,
amendments and renewals thereof, whether for principal, interest,
premiums, fees, costs, expenses, indemnifications or otherwise (all
such obligations secured herein referred to as the "Obligations").
3. Representations and Warranties. Assignor represents and
warrants to Assignee that:
(a) All applicable representations and warranties of
Assignor in Article IV of the Credit Agreement are true and correct
with respect to the Operator Loan Documents.
(b) Except for prior assignments to Assignee, Assignor
has not heretofore made any other assignment of its entire or any
part of its interest in and to any or all of the Operator Loan
Documents or entered into any agreement to subordinate any of the
Operator Loan Documents or Assignor's right to receive any amounts
payable thereunder.
(c) Assignor has not heretofore executed any instrument
or performed any act which may or might prevent Assignee from
enforcing the Operator Loan Documents.
(d) Assignor has not waived, released, reduced,
discounted or otherwise discharged or compromised any sums due
under or secured by the Operator Loan Documents except as
previously disclosed to the Banks in writing.
4. Covenants of Assignor. Assignor covenants and agrees that:
(a) Assignor shall perform and observe all the material
terms and provisions of each Operator Loan Document and maintain
each Operator Loan Document in full force and effect, and enforce,
to the extent that Assignor, in its reasonable judgment, determines
to be appropriate, each Operator Loan Document in accordance with
its terms if the failure of Assignor to perform, observe or enforce
such Operator Loan Document has resulted or would, more likely than
not, result in a Material Adverse Effect (as defined in the Credit
Agreement). Assignor shall not permit any obligor under any
Operator Loan Document to remain in material default thereof if
such default has resulted or would, more likely than not, result in
a Material Adverse Effect.
(b) If Assignor defaults under any Operator Loan
Document, Assignee shall have the right (but not the obligation) to
cure such default within the cure period afforded to Assignor under
such Operator Loan Document or under applicable Law. Any and all
advances, payments, expenses, fees or costs paid or incurred by
Assignee in connection with the cure of any such default, together
with interest thereon at the highest lawful default rate specified
in the Credit Agreement ("Default Rate"), shall be paid by Assignor
to Assignee upon demand therefor.
(c) Assignor shall not take or permit any action to
amend, cancel, terminate, waive any provision of, or consent to the
noncompliance with any term of any Operator Loan Document;
provided, however, that Assignor may take any such action so long
as such action (i) does not relate to a material financial
provision of any Operator Loan Document, (ii) does not relate to
any provision in any Operator Loan Document and which provision is
expressly for the benefit of the mortgagor or assignee with respect
thereto, (iii) is taken in the ordinary course of Assignor's
business, (iv) is consistent with Assignor's past practices, (v)
would not, more likely than not, result in a Material Adverse
Effect, and (vi) will not have an adverse effect on the interest
(including the perfection and priority of any security interest or
Lien (as defined in the Credit Agreement) in favor of Assignor or
Assignee and the Banks) of Assignee and the Banks in such agreement
or the assets with respect thereto or otherwise result in a
Material Impairment (as defined in the Credit Agreement).
(d) Except as otherwise provided in this Assignment,
Assignor shall continue to collect, at its own expense, all amounts
due or to become due Assignor under the Operator Loan Documents.
In connection with such collections, Assignor may take such action
as Assignor (and, upon the occurrence and during the continuance of
any Event of Default, at Assignee's direction, shall take such
action as Assignee) may deem necessary or advisable to enforce
collection of the obligations evidenced by the Operator Loan
Documents; provided, however, that such action taken by Assignor
prior to the occurrence of an Event of Default (i) does not violate
any other provision of any Loan Document; (ii) is taken in the
ordinary course of Assignor's business, (iii) is consistent with
Assignor's past practices, (iv) would not, more likely than not,
result in a Material Adverse Effect, and (v) will not have an
adverse effect on the interest (including the perfection and
priority of any security interest or Lien (as defined in the Credit
Agreement) in favor of Assignor or Assignee and the Banks) of
Assignee and the Banks in such agreement or the assets with respect
thereto or otherwise result in a Material Impairment (as defined in
the Credit Agreement).
(e) Assignor shall, at its sole cost and expense, appear
in and defend any and all actions and proceedings arising under,
relating to or in any manner connected with any Operator Loan
Document or the obligations, duties or liabilities of the lessor or
any tenant, lessee or guarantor thereunder.
(f) Assignor shall promptly notify Assignee of any
notice received from any obligor with respect to any claimed
default on the part of the secured party under any Operator Loan
Document.
5. Present Assignment. Although it is the intention of the
parties that the assignment contained herein is a present
assignment, so long as no Event of Default has occurred hereunder
Assignor shall have the right to collect all sums due under or
secured by the Operator Loan Documents and to retain, use and enjoy
the same. Any such sums collected and received by Assignor after
the occurrence of an Event of Default hereunder shall be deemed
collected and received by Assignor in trust for Assignee, and
Assignor shall account to Assignee for the full amount of such
collections and receipts. Assignee shall have the right to notify
the obligors under the Operator Loan Documents of the existence of
this Assignment at any time.
6. Events of Default. Each of the following shall constitute
an "Event of Default" for purposes of this Assignment:
(a) Assignor shall fail or omit to perform or observe
any provision of Section 4(a) of this Assignment within thirty (30)
Business Days after the giving of written notice to Assignor by
Assignee that it is to be remedied.
(b) Assignor shall fail or omit to perform or observe
any provision of Section 4 of this Assignment other than Section
4(a).
(c) Any representation, warranty or statement made by
Assignor in this Assignment shall be false or erroneous in any
respect when made or deemed made, as the case may be.
(d) An Event of Default shall occur under any other Loan
Document.
7. Rights and Remedies Upon Default. At any time upon or
following the occurrence of any Event of Default hereunder,
Assignee, at its option in accordance with the provisions of the
Credit Agreement and without any obligation to do so, without in
any way waiving such Event of Default, without notice or demand on
Assignor, without regard to the adequacy of the security for the
obligations secured hereby, without releasing Assignor or any
obligor under the Loan Documents from any obligation thereunder,
and with or without bringing any action or proceeding, may do any
or all of the following:
(a) either with or without taking possession of any of
the property encumbered by the Operator Loan Documents, and as
attorney-in-fact, either in Assignee's own name or as agent for
Assignor, demand, sue for, settle, compromise, collect, and give
acquittances for all sums due under or secured by any of the
Operator Loan Documents and pursue all remedies for enforcement of
the Operator Loan Documents and all the secured party's rights
therein and thereunder, provided that, for such purpose, this
Assignment shall constitute an authorization and direction to the
obligors under the Operator Loan Documents to pay all amounts
payable under the Operator Loan Documents to Assignee, without
proof of default hereunder, upon receipt from Assignee of written
notice to thereafter pay all such rents and other amounts to
Assignee and to comply with any notice or demand by Assignee for
observance or performance of any of the covenants, terms,
conditions and agreements contained in the Operator Loan Documents
to be observed or performed by the obligors thereunder, and
provided, further, that Assignor will facilitate Assignee's
collection of such amounts, and upon request will execute written
notices to the obligors under the Operator Loan Documents to
thereafter pay all such amounts to Assignee; and
(b) make any payment or do any act required herein of
Assignor, as attorney-in-fact, either in Assignee's own name or as
agent for Assignor, and in such manner and to such extent as
Assignee may deem necessary in its sole discretion, and any amount
so paid by Assignee shall become immediately due and payable by
Assignor with interest thereon until paid at the Default Rate and
shall be secured by this Assignment.
8. Application of Proceeds. Assignee, in the exercise of its
rights and powers following the occurrence of any Event of Default
shall apply all of the sums collected and received by Assignee in
the manner set forth in the Credit Agreement.
9. Limitation of Assignee's Liability; Indemnification.
Assignee shall not be liable for any loss sustained by Assignor
resulting from any act or omission of Assignee in enforcing any
rights or powers provided for hereunder or under the Operator Loan
Documents following the occurrence of any one or more Events of
Default unless caused by the gross negligence or willful misconduct
of Assignee. Assignee shall not be obligated to observe, perform
or discharge, nor does Assignee hereby undertake to observe,
perform or discharge, any covenant, term, condition or agreement
contained in any Operator Loan Document to be observed or performed
by the secured party thereunder, or any obligation, duty or
liability of Assignor under or by reason of this Assignment, and
Assignor shall and does hereby agree to indemnify and hold Assignee
and the Banks harmless of and from any and all liability, loss or
damage which Assignee incurs under any Operator Loan Document or by
reason of this Assignment and of and from any and all claims and
demands whatsoever which may be asserted against Assignee or any of
the Banks by reason of any alleged obligation or undertaking on its
part to observe or perform any of the covenants, terms, conditions
and agreements contained in any Operator Loan Document by reason of
this Agreement. Should Assignee or any of the Banks incur any such
liability, loss or damage under any Operator Loan Document or under
or by reason of this Assignment, or in the defense of any such
claim or demand, the amount thereof, including costs, expenses and
attorneys' fees and expenses, shall become immediately due and
payable by Assignor to Assignee of such of the Banks with interest
thereon at the Default Rate and shall be secured by this
Assignment. This Assignment shall not operate to place
responsibility for the care, control, management or repair of any
premises encumbered by a Operator Loan Document or for the carrying
out of any of the covenants, terms, conditions and agreements
contained in any Operator Loan Document upon Assignee.
Notwithstanding any provision of this Assignment to the contrary,
Assignor's obligation to indemnify and hold Assignee and the Banks
harmless under this Assignment shall not include liability, loss or
damage which Assignee or any of the Banks incurs arising out of its
gross negligence or willful misconduct or arising out of the action
or inaction of Assignee after Assignee or its agent acquires fee
title to the Premises.
10. Non-Waiver. Nothing contained in this Assignment and no
act done or omitted to be done by Assignee pursuant to the rights
and powers granted to it hereunder shall be deemed to be a waiver
by Assignee of its rights and remedies under the Credit Agreement
and any of the other Loan Documents; this Assignment is made and
accepted without prejudice to any of the rights and remedies of
Assignee under the terms and provisions of such instruments; and
Assignee may exercise any of its rights and remedies under the
terms and provisions of such instruments either prior to,
simultaneously with or subsequent to any action taken by it
hereunder. Without limitation of the foregoing, Assignee may take
or release any other security for the performance of the
obligations secured hereby, may release any party primarily or
secondarily liable therefor, and may apply any other security held
by it for the satisfaction of the obligations secured hereby
without prejudice to any of its rights and powers hereunder.
11. Further Assurances. Assignor shall execute or cause to
be executed such additional instruments (including, but not limited
to, general or specific assignments of such Operator Loan Documents
as Assignee may designate) and shall do or cause to be done such
further acts, as Assignee may reasonably request, in order to
permit Assignee to perfect, protect, preserve and maintain the
assignment made to Assignee by this Assignment.
12. Severability. Any provision hereof prohibited or invalid
under applicable Law shall be ineffective only to the extent of
such prohibition or invalidity, without invalidating the other
provisions hereof.
13. Successors and Assigns; Assignments. This Assignment is
binding upon Assignor, its successors and assigns, and the rights,
powers and remedies of Assignee under this Assignment shall inure
to the benefit of Assignee and its successors and assigns.
Assignor may not assign its obligations or rights hereunder without
the consent of Assignee and each of the Banks. Each of Assignee
and the Banks may assign its rights hereunder subject to the
limitations set forth in Article VIII of the Credit Agreement.
14. Amendments and Waivers. No amendment or waiver of any
provision of this Assignment, nor consent to any departure by
Assignor therefrom, shall in any event be effective unless the same
shall be in writing and signed by the Majority Banks (as defined in
the Credit Agreement), and then such waiver or consent shall be
effective only in the specific instance and for the specific
purpose for which given; provided, however, that no amendment,
waiver or consent shall, unless in writing and signed by all the
Banks, do any of the following: (a) reduce the principal of, or
interest on, any fees or other amounts payable hereunder, (b)
change the method of computing of interest or any fee, (c) release
any Operator Loan Document from the operation of this Assignment
other than as provided in Section 2.08 of the Credit Agreement, (d)
amend this Section 14 or (e) amend, modify or waive any provision
of this Assignment where such provision requires consent or waiver
by all Banks or any amendment of such a provision which would amend
such requirement of consent by all Banks; and provided, further,
that no amendment, waiver or consent shall, unless in writing and
signed by Assignee in addition to the Banks required above to take
such action, affect the rights or duties of Assignee under this
Assignment.
15. Cumulative Provisions. Each right, power or privilege
specified or referred to in this Assignment is in addition to and
not in limitation of any other rights, powers and privileges that
the Banks and Assignee may respectively otherwise have or acquire
by operation of Law, by other contract or otherwise.
16. Duration; Survival of Provisions. This Assignment and
grant shall continue in effect until either (i) all of the
Obligations of Assignor and the other obligors (if any) under the
Loan Documents are fully performed, satisfied and repaid or (ii)
Assignor satisfies the requirements of Section 2.08(b) of the
Credit Agreement with respect to the Premises or Sections 2.08(d)
or 2.08(e) of the Credit Agreement; provided, however, that (a) all
representations and warranties made in or pursuant to this
Assignment shall survive the execution and delivery of this
Assignment, and (b) the indemnification provisions set forth in
this Assignment shall survive the performance, satisfaction and
repayment of the Obligations.
17. Governing Law. This Assignment and the respective rights
and obligations of the parties hereto shall be governed by and
construed in accordance with the internal laws of the State of Ohio
(without giving effect to the conflict of laws rules thereof),
except to the extent that the perfection and enforcement of the
lien and security interest granted hereunder must be subject to the
laws governing the Operator Loan Documents.
18. Notices. All notices and other communications provided
for hereunder shall be in writing (including telecopier,
telegraphic, telex or cable communication) and mailed, telecopied,
telegraphed, telexed, cabled or delivered, to the intended
recipient at its address set forth in the preamble to this
Assignment; or, as to any party, at such other address as shall be
designated by such party in a written notice to each of the other
parties. All such notices and communications shall, when mailed,
telecopied, telegraphed, telexed or cabled, be effective when
deposited in the mails, telecopied, delivered to the telegraph
company, confirmed by telex answerback or delivered to the cable
company, respectively, except that notices and communications to
Assignee pursuant to Section 6 shall not be effective until
received by Assignee.
19. WAIVER OF JURY TRIAL. THE PARTIES ACKNOWLEDGE AND AGREE
THAT ANY CONTROVERSY THAT MAY ARISE UNDER THIS ASSIGNMENT OR THE
OTHER LOAN DOCUMENTS WOULD INVOLVE DIFFICULT AND COMPLEX ISSUES AND
THEREFORE AGREE THAT ANY LAW SUIT GROWING OUT OF OR INCIDENTAL TO
ANY SUCH CONTROVERSY WILL BE TRIED IN A COURT OF COMPETENT
JURISDICTION BY A JUDGE SITTING WITHOUT A JURY. ASSIGNOR CONFIRMS
THAT THE FOREGOING WAIVER IS INFORMED AND FREELY MADE.
20. Jurisdiction; Venue, Inconvenient Forum.
(a) EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY AND
UNCONDITIONALLY SUBMITS, FOR ITSELF AND ITS PROPERTY, TO THE
NONEXCLUSIVE JURISDICTION OF ANY OHIO STATE COURT OR FEDERAL COURT
OF THE UNITED STATED OF AMERICA SITTING IN CUYAHOGA COUNTY, OHIO,
AND ANY APPELLATE COURT FROM ANY THEREOF, IN ANY ACTION OR
PROCEEDING ARISING OUT OF OR RELATING TO THIS ASSIGNMENT, THE
CREDIT AGREEMENT, ANY COLLATERAL DOCUMENT OR ANY RELATED WRITING OR
FOR RECOGNITION OR ENFORCEMENT OF ANY JUDGMENT, AND EACH OF THE
PARTIES HERETO HEREBY IRREVOCABLY AND UNCONDITIONALLY AGREES THAT
ALL CLAIMS IN RESPECT OF ANY SUCH ACTION OR PROCEEDING MAY BE HEARD
AND DETERMINED IN ANY SUCH OHIO STATE OR, TO THE EXTENT PERMITTED
BY LAW, IN SUCH FEDERAL COURT. EACH OF THE PARTIES HERETO AGREES
THAT A FINAL JUDGMENT IN ANY SUCH ACTION OR PROCEEDING SHALL BE
CONCLUSIVE AND MAY BE ENFORCED IN OTHER JURISDICTIONS BY SUIT ON
THE JUDGMENT OR IN ANY OTHER MANNER PROVIDED BY LAW. NOTHING IN
THIS AGREEMENT SHALL AFFECT ANY RIGHT THAT ANY PARTY MAY OTHERWISE
HAVE TO BRING ANY ACTION OR PROCEEDING RELATING TO THIS ASSIGNMENT,
THE CREDIT AGREEMENT, ANY COLLATERAL DOCUMENT OR ANY RELATED
WRITING IN THE COURTS OF ANY JURISDICTION.
(b) EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY AND
UNCONDITIONALLY WAIVES, TO THE FULLEST EXTENT IT MAY LEGALLY AND
EFFECTIVELY DO SO, ANY OBJECTION THAT IT MAY NOW OR HEREAFTER HAVE
TO THE LAYING OF VENUE OF ANY SUIT, ACTION OR PROCEEDING ARISING
OUT OF OR RELATING TO THIS ASSIGNMENT, THE CREDIT AGREEMENT, ANY
COLLATERAL DOCUMENT OR ANY OTHER RELATED WRITING IN ANY OHIO STATE
OR FEDERAL COURT SITTING IN OHIO. EACH OF THE PARTIES HERETO HEREBY
WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW, THE DEFENSE OF AN
INCONVENIENT FORUM TO THE MAINTENANCE OF SUCH ACTION OR PROCEEDING
IN ANY SUCH COURT. ASSIGNOR CONFIRMS THAT THE FOREGOING WAIVERS
ARE INFORMED AND FREELY MADE.
21. Miscellaneous. The headings of each section of this
Assignment are for convenience only and shall not define or limit
the provisions thereof. This Assignment and all rights and
obligations hereunder shall be binding upon Assignor and its
successors and assigns, and shall inure to the benefit of Assignee
and its successors and assigns. If any term of this Assignment
shall be held to be invalid, illegal or unenforceable, the validity
of all other terms hereof shall in no way be affected thereby, and
this Assignment shall be construed and be enforceable as if such
invalid, illegal or unenforceable term had not been included
herein.
22. Certain Defined Terms. As used herein, the term
"Assignee" means National City Bank, a national banking
association, acting in its capacity as agent for its benefit and
the ratable benefit of the Banks, together with its successors and
assigns in such capacity, and the term "Banks" means National City
Bank and certain other banks as set forth in the Credit Agreement,
and such other banks as may become parties to the Credit Agreement
from time to time, together with their respective successors and
assigns.
IN WITNESS WHEREOF, Assignor has caused this Assignment to be
executed by its officers or agents thereunto duly authorized, as of
the date first above written.
Signed, sealed and delivered HEALTH CARE REIT, INC., a
in the presence of: Delaware corporation
By:--------------------------
- - - ------------------------------- Name:------------------------
(Witness to both signatures)
- - - ------------------------------ Title:-----------------------
Print Name
By:--------------------------
- - - -----------------------------
(Witness to both signatures) Name:------------------------
- - - -----------------------------
Print Name Title:-----------------------
STATE OF OHIO )
) SS:
COUNTY OF )
BEFORE ME, a Notary Public in and for said County, personally
appeared the above named HEALTH CARE REIT, INC., a Delaware
corporation, by ---------------------------, its ------------------
and ---------------------------- its ------------------, who
acknowledged that they did sign the foregoing Assignment of Lease
and Rents and that the same is the free act and deed of said
corporation and the free act and deed of them personally and as
such officers.
IN TESTIMONY WHEREOF, I have hereunto set my hand and official
seal at ---------------------, Ohio this ---- day of -------------,
1994.
-------------------------------
Notary Public
My commission expires: --------
This Instrument Prepared by:
Calfee, Halter & Griswold
800 Superior Avenue, Suite 1800
Cleveland, OH 44114-2688
<PAGE>
EXHIBIT A
OPERATOR LOAN DOCUMENTS
<PAGE>
EXHIBIT B
LEGAL DESCRIPTION OF THE PREMISES
EXHIBIT J
FORM OF SUBSIDIARY GUARANTY AGREEMENT
This GUARANTY AGREEMENT (this "Agreement") is made as of
this 8th day of September, 1994, by [___________________________],
a [________________] corporation (the "Guarantor"), ______________,
in favor of NATIONAL CITY BANK, a national banking association, as
Agent (together with its successors and assigns in such capacity,
the "Agent"), National City Center, 1900 East Ninth Street, Metro
Division, Cleveland, Ohio 44114, for the ratable benefit of itself
and the Banks (as defined below) from time to time parties to the
Credit Agreement (as such term is hereinafter defined).
RECITALS
To induce the Agent and the Banks to extend credit from
time to time to Health Care REIT, Inc. (the "Borrower"), including
particularly under an Amended and Restated Credit Agreement among
the Borrower, the Agent and the Banks, dated as of September 8,
1994 (said Agreement, as it may hereafter be amended or otherwise
modified from time to time, being the "Credit Agreement"), the
Guarantor hereby agrees as follows:
Section 1. Definitions. The terms defined in the
Credit Agreement and not otherwise defined herein are used herein
as therein defined. The following additional terms shall have the
meanings specified below:
"Adjusted Net Worth" shall mean, as of any date of
determination thereof, the excess of (i) the amount of the "present
fair saleable value" of the assets of the Guarantor as of the date
of such determination, over (ii) the amount of all liabilities of
the Guarantor, contingent or otherwise, as of the date of such
determination, as such terms are determined in accordance with
applicable federal and state laws governing determinations of the
insolvency of debtors. In determining the Adjusted Net Worth of
the Guarantor for purposes of calculating the Maximum Guaranteed
Amount for the Guarantor, the liabilities of such Guarantor to be
used in the determination pursuant to clause (ii) of the preceding
sentence shall in any event include any amounts guaranteed by the
Guarantor pursuant to clause (i) of the definition of Maximum
Guaranteed Amount.
"Maximum Guaranteed Amount" shall mean, as of any date of
determination thereof, the sum of (i) the aggregate amount of the
Loans, to the extent the proceeds thereof are used to make a
Valuable Transfer to the Guarantor plus (ii) the greater of (A)
ninety-five percent (95%) of the Adjusted Net Worth of the
Guarantor at the date of the execution of this Guaranty and (B)
ninety-five percent (95%) of the Adjusted Net Worth of the
Guarantor at the earlier of (I) the date of the commencement of a
case under Title 11 of the United States Code in which the
Guarantor is a debtor and (II) the date enforcement hereunder is
obtained.
"Guaranteed Obligations" has the meaning given that term
in Section 2 hereof.
"Valuable Transfer" shall mean (i) all loans, advances or
capital contributions made to the Guarantor with proceeds of the
Loans, (ii) all debt securities or other obligations of the
Guarantor acquired from the Guarantor or retired by such Guarantor
with proceeds of the Loans, (iii) the fair market value of all
property acquired with proceeds of the Loans and transferred,
absolutely and not as collateral, to the Guarantor, (iv) all equity
securities of the Guarantor acquired from the Guarantor with
proceeds of the Loans and (v) the value of any quantifiable
economic benefits not included in clauses (i) through (iv) above,
but includable in accordance with applicable federal and state laws
governing determinations of the insolvency of debtors, accruing to
the Guarantor as a result of the Loans.
SECTION 2. Guaranty. The Guarantor hereby
unconditionally guarantees the punctual payment when due, whether
at stated maturity, by acceleration or otherwise, of all
obligations the Borrower may now or hereafter owe to the Agent or
the Banks or any thereof of every type and description, including,
but not limited to, the Borrower's Obligations (as defined in the
Credit Agreement) (all such obligations of the Borrower being
referred to herein as of the "Guaranteed Obligations") and agrees
to pay any and all expenses (including counsel fees and expenses)
incurred by the Agent or the Banks in enforcing any rights under
this Guaranty; provided, however, that, anything herein or in any
other document, instrument or agreement executed and delivered in
connection herewith to the contrary notwithstanding, the maximum
liability of the Guarantor hereunder shall in no event exceed the
Guarantor's Maximum Guaranteed Amount.
SECTION 3. Guaranty Absolute. The Guarantor guarantees
that the Guaranteed Obligations will be paid strictly in accordance
with the terms of the Credit Agreement and the Related Writings,
regardless of any law, regulation or order now or hereafter in
effect in any jurisdiction affecting any of such terms or the
rights of the Agent or the Banks with respect thereto. The
liability of the Guarantor under this Guaranty shall be absolute
and unconditional irrespective of:
(i) any lack of validity or enforceability of the Credit
Agreement, the Notes, the Collateral Documents, the Related
Writings, or any other agreement or instrument relating thereto;
(ii) any change in the time, manner or place of payment of,
or in any other term of, all or any of the Guaranteed Obligations,
or any other amendment or waiver of or any consent to departure
from the Credit Agreement, the Notes, the Collateral Documents, the
Related Writings, or any other agreement or instrument relating
thereto;
(iii) any exchange, release or non-perfection of any
collateral, or any release or amendment or waiver of or consent to
departure from any other guaranty, for all or any of the Guaranteed
Obligations;
(iv) failure by the Agent or the Banks to take any steps to
perfect and maintain its or their security interest in, or preserve
its or their rights to, any security or collateral for the
Guaranteed Obligations;
(v) the Agent's or any Bank's election in any proceeding
instituted under Chapter 11 of Title 11 of the United States Code
(11 U.S.C. Section 101 et seq.) (the "Bankruptcy Code"), or the
application of Section 1111(b)(2) of the Bankruptcy Code;
(vi) any borrowing or grant of a security interest under
Section 364 of the Bankruptcy Code; or
(vii) any other circumstance that might otherwise constitute
a defense available to, or a discharge of, the Borrower or any
guarantor.
This Guaranty shall continue to be effective or be reinstated, as
the case may be, if at any time any payment of any of the
Guaranteed Obligations is rescinded or must otherwise be returned
by the Agent or any Bank upon the insolvency, bankruptcy or
reorganization of the Borrower or otherwise, all as though such
payment had not been made.
SECTION 4. Waiver. The Guarantor hereby waives
promptness, diligence, notice of acceptance and any other notice
with respect to any of the Guaranteed Obligations and this Guaranty
and any requirement that the Agent or any Bank protect, secure,
perfect or insure any security interest or lien or any property
subject thereto or exhaust any right or take any action against the
Borrower or any other person or entity or any collateral.
SECTION 5. Subrogation. The Guarantor shall have no
right of subrogation, reimbursement or contribution and hereby
waives any right to enforce any remedy which the Agent or any of
the Banks now has or may hereafter have against the Borrower, any
endorser or any other guarantor, of all or any part of the
Guaranteed Obligations, and the Guarantor hereby waives any benefit
of, and any right to participate in, any security or collateral
given to the Agent or any Bank to secure payment of the Guaranteed
Obligations or any other liability of the Borrower to the Agent or
the Banks. The Guarantor also waives all setoffs and counterclaims
and all presentments, demands for performance, notices of
nonperformance, protests, notices of protest, notices of dishonor,
and notices of acceptance of this Guaranty. The Guarantor further
waives all notices of the existence, creation or incurring of new
or additional indebtedness, arising either from additional loans
extended to the Borrower or otherwise, and also waives all notices
that the principal amount, or any portion thereof, and/or any
interest on any instrument or document evidencing all or any part
of the Guaranteed Obligations is due, notices of any and all
proceedings to collect from the maker, any endorser or any other
guarantor of all or any part of the Guaranteed Obligations, or from
anyone else, and, to the extent permitted by law, notices of
exchange, sale, surrender or other handling of any security or
other collateral given to the Agent or the Banks to secure payment
of the Guaranteed Obligations.
SECTION 6. Representations and Warranties. The
Guarantor hereby represents and warrants that (i) the Guarantor is
a corporation duly organized and existing in good standing and has
full power and authority to make and deliver this Guaranty; (ii)
the execution, delivery and performance of this Guaranty by the
Guarantor have been duly authorized by all necessary action of its
directors and shareholders and do not and will not violate the
provisions of, or constitute a default under, any presently
applicable law or its articles of incorporation or code of
regulations or any agreement presently binding on it; (iii) this
Guaranty has been duly executed and delivered by the authorized
officers of the Guarantor and constitutes its lawful, binding and
legally enforceable obligation (subject to the United States
Bankruptcy Code and other similar laws generally affecting the
enforcement of creditors' rights); and (iv) the authorization,
execution, delivery and performance of this Guaranty do not require
notification to, registration with, or consent or approval by, any
federal, state or local regulatory body or administrative agency.
SECTION 7. Authorization. The Agent and each Bank are
hereby authorized, without notice or demand and without affecting
the liability of the Guarantor hereunder, from time to time, to (i)
renew, extend, accelerate or otherwise change the time for payment
of, or other terms relating to, the Guaranteed Obligations, or
otherwise modify, amend or change the terms of the Notes, any other
promissory note or other agreement, document or instrument now or
hereafter executed by the Borrower and delivered to the Agent or
any of the Banks; (ii) accept partial payments on the Guaranteed
Obligations; (iii) take and hold security or collateral for the
payment of this Guaranty, any other guarantees of the Guaranteed
Obligations or other liabilities of the Borrower and the Guaranteed
Obligations guaranteed hereby or thereby, and exchange, enforce,
waive and release any such security or collateral; (iv) apply such
security or collateral and direct the order or manner of sale
thereof as in its discretion it may determine; and (v) settle,
release, compromise, collect or otherwise liquidate the Guaranteed
Obligations and any security or collateral therefor in any manner,
without affecting or impairing the obligations of the Guarantor
hereunder.
At any time upon the occurrence and during the
continuation of an Event of Default, the Agent may, in its sole
discretion, without notice to the Guarantor and regardless of the
acceptance of any security or collateral for the payment hereof,
appropriate and apply toward the payment of the Guaranteed
Obligations (i) any indebtedness due or to become due from the
Agent or any of the Banks to the Guarantor, and (ii) any moneys,
credits or other property belonging to the Guarantor, at any time
held by or coming into the possession of the Agent or any of the
Banks.
SECTION 8. Amendments, Etc. No amendment or waiver of
any provisions of this Guaranty nor consent to any departure by the
Guarantor therefrom shall in any event be effective unless the same
shall be in writing and signed by the Agent and the Majority Banks,
and then such waiver or consent shall be effective only in the
specific instance and for the specific purpose for which given. No
release or termination of this Guaranty shall be effected unless
the same shall be in writing and executed by the Agent and each of
the Banks.
SECTION 9. No Waiver; Remedies. No failure on the part
of the Agent or any Bank 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 right hereunder preclude any
other or further exercise thereof or the exercise of any other
right. The remedies herein provided are cumulative and not
exclusive of any remedies provided by law.
SECTION 10. Right of Set-off. Upon the occurrence and
during the continuance of any Event of Default, each Bank is hereby
authorized at any time and from time to time, to the fullest extent
permitted by law, to set off and apply any and all deposits
(general or special, time or demand, provisional or final) at any
time held and other indebtedness at any time owing by such Bank to
or for the credit or the account of the Guarantor against any and
all of the obligations of the Guarantor now or hereafter existing
under this Guaranty, irrespective of whether or not such Bank shall
have made any demand under this Guaranty and although such
obligations may be contingent and unmatured. Each Bank agrees
promptly to notify the Guarantor after any such set-off and
application made by such Bank, provided that the failure to give
such notice shall not affect the validity of such set-off and
application. The rights of each Bank under this Section 10 are in
addition to other rights and remedies (including, without
limitation, other rights of set-off) which such Bank may have.
SECTION 11. Continuing Guaranty; Transfer of Revolving
Note. This Guaranty is a continuing guaranty and shall (i) remain
in full force and effect until the Guaranteed Obligations are paid
in full and each Bank's Revolving Credit Commitment is terminated,
and shall continue in effect thereafter until this Guaranty is
revoked prospectively as to future transactions by written notice
to that effect actually received by the Agent (but such notice
shall not be effective as to any Guaranteed Obligations or the
Revolving Credit Commitment outstanding at that time, any
additional interest, premiums or fees to become payable with
respect thereto or any renewals, extensions, or refinancings of the
same), (ii) be binding upon the Guarantor, its successors and
assigns, and (iii) inure to the benefit of and be enforceable by
the Agent and each Bank and their successors, transferees and
assigns. Without limiting the generality of the foregoing clause
(iii), each Bank may assign or otherwise transfer the Notes to any
other person or entity in accordance with the provisions of Article
8 of the Credit Agreement, and such other person or entity shall
thereupon become vested with all the rights in respect thereof
granted to such Bank herein or otherwise.
SECTION 12. Addresses for Notices. All notices and
other communications provided for hereunder shall be in writing
(including telecopy, telegraphic, telex or cable communication) and
mailed, telecopied, telegraphed, telexed, cabled or delivered, if
to the Guarantor, at its address shown below its signature hereto;
and if to the Agent or any Bank, at its address specified in the
Credit Agreement, or as to each party at such other address as
shall be designated by such party in a written notice to the other
party. All such notices and other communications shall, when
mailed, telecopied, telegraphed, telexed or cabled, be effective
when deposited in the mails, telecopied, delivered to the telegraph
company, confirmed by telex answerback or delivered to the cable
company, respectively.
SECTION 13. Solvency. The Guarantor is solvent (as
defined in the Credit Agreement). The Guarantor does not believe
that final judgments, if any, against the Guarantor in actions for
money damages presently pending will be rendered at a time when, or
in an amount such that, the Guarantor will be unable to satisfy any
such judgments promptly in accordance with their terms (taking into
account the maximum reasonable amount of such judgments in any such
actions and the earliest reasonable time at which such judgments
might be rendered). The cash flow of the Guarantor, after taking
into account all other anticipated uses of the cash of the
Guarantor (including the payments on or in respect of debt referred
to in this Section 13), will at all times be sufficient to pay all
such judgments promptly in accordance with their terms.
SECTION 14. Waiver of Jury Trial. THE PARTIES
ACKNOWLEDGE AND AGREE THAT ANY CONTROVERSY THAT MAY ARISE UNDER
THIS GUARANTY, THE CREDIT AGREEMENT, THE COLLATERAL DOCUMENTS OR
THE RELATED WRITINGS WOULD INVOLVE DIFFICULT AND COMPLEX ISSUES AND
THEREFORE AGREE THAT ANY LAW SUIT GROWING OUT OF OR INCIDENTAL TO
ANY SUCH CONTROVERSY WILL BE TRIED IN A COURT OF COMPETENT
JURISDICTION BY A JUDGE SITTING WITHOUT A JURY.
SECTION 15. Jurisdiction; Venue; Inconvenient Forum.
(a) Jurisdiction. EACH OF THE PARTIES HERETO HEREBY
IRREVOCABLY AND UNCONDITIONALLY SUBMITS, FOR ITSELF AND ITS
PROPERTY, TO THE NONEXCLUSIVE JURISDICTION OF ANY OHIO STATE COURT
OR FEDERAL COURT OF THE UNITED STATED OF AMERICA SITTING IN
CUYAHOGA COUNTY, OHIO, AND ANY APPELLATE COURT FROM ANY THEREOF, IN
ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS
GUARANTY, THE CREDIT AGREEMENT, THE COLLATERAL DOCUMENTS (AS
DEFINED IN THE CREDIT AGREEMENT) OR ANY RELATED WRITING (AS DEFINED
IN THE CREDIT AGREEMENT), OR FOR RECOGNITION OR ENFORCEMENT OF ANY
JUDGMENT, AND EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY AND
UNCONDITIONALLY AGREES THAT ALL CLAIMS IN RESPECT OF ANY SUCH
ACTION OR PROCEEDING MAY BE HEARD AND DETERMINED IN ANY SUCH OHIO
STATE OR, TO THE EXTENT PERMITTED BY LAW, IN SUCH FEDERAL COURT.
EACH OF THE PARTIES HERETO AGREES THAT A FINAL JUDGMENT IN ANY SUCH
ACTION OR PROCEEDING SHALL BE CONCLUSIVE AND MAY BE ENFORCED IN
OTHER JURISDICTIONS BY SUIT ON THE JUDGMENT OR IN ANY OTHER MANNER
PROVIDED BY LAW. NOTHING IN THIS AGREEMENT SHALL AFFECT ANY RIGHT
THAT ANY PARTY MAY OTHERWISE HAVE TO BRING ANY ACTION OR PROCEEDING
RELATING TO THIS GUARANTY, THE CREDIT AGREEMENT, ANY COLLATERAL
DOCUMENT OR ANY RELATED WRITING IN THE COURTS OF ANY JURISDICTION.
(b) Venue; Inconvenient Forum. EACH OF THE PARTIES HERETO
HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVES, TO THE FULLEST
EXTENT IT MAY LEGALLY AND EFFECTIVELY DO SO, ANY OBJECTION THAT IT
MAY NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY SUIT,
ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS GUARANTY,
THE CREDIT AGREEMENT, ANY COLLATERAL DOCUMENT OR ANY OTHER RELATED
WRITING IN ANY OHIO STATE OR FEDERAL COURT SITTING IN CUYAHOGA
COUNTY, OHIO. EACH OF THE PARTIES HERETO HEREBY WAIVES, TO THE
FULLEST EXTENT PERMITTED BY LAW, THE DEFENSE OF AN INCONVENIENT
FORUM TO THE MAINTENANCE OF SUCH ACTION OR PROCEEDING IN ANY SUCH
COURT. THE GUARANTOR CONFIRMS THAT THE FOREGOING WAIVERS ARE
INFORMED AND FREELY MADE.
SECTION 16. Governing Law. This Guaranty shall be
governed by, and construed in accordance with, the laws of the
State of Ohio.
IN WITNESS WHEREOF, the Guarantor has caused this
Guaranty to be executed as of the date first above written.
------------------------------
By:-----------------------------
Its:----------------------------
Address:
--------------------------------
--------------------------------
--------------------------------
EXHIBIT K
Prepared by and, after EXECUTION COPY
recording, return to:
Lynn M. Gattozzi
Calfee, Halter & Griswold
Suite 1800
800 Superior Avenue
Cleveland, Ohio 44114-2688
(216) 622-8200
[AMENDED AND RESTATED] COLLATERAL ASSIGNMENT OF OPERATOR
LEASE DOCUMENTS AND RENTS
THIS [AMENDED AND RESTATED] COLLATERAL ASSIGNMENT OF OPERATOR
LEASE DOCUMENTS AND RENTS (this "Assignment") is made as of this
_____ day of _____, 1994 by HEALTH CARE REIT, INC., a Delaware
corporation ("Assignor"), One SeaGate, Suite 1950, Toledo, Ohio
43003, to NATIONAL CITY BANK, a national banking association, as
Agent for its benefit and the ratable benefit of the Banks (as
defined below), their successors and assigns (together with its
successors and assigns in such capacity, "Assignee"), National City
Center, 1900 East Ninth Street, Metro Division, Cleveland, Ohio
44114.
RECITALS
WHEREAS, Assignor, as the "Borrower" has entered into that
certain Amended and Restated Credit Agreement dated as of the
effective date hereof (as the same may be supplemented, amended,
restated, modified or substituted from time to time, the "Credit
Agreement"; capitalized terms used herein without definition have
the meanings ascribed to such terms in the Credit Agreement) with
National City Bank and certain other banks as set forth in the
Credit Agreement (such banks and such other banks as may become
parties to the Credit Agreement from time to time, together with
their respective successors and assigns, all being hereinafter
collectively referred to as the "Banks") and Assignee as agent for
its benefit and the ratable benefit of the Banks (together with its
successors and assigns in such capacity hereinafter referred to as
"Assignee"), pursuant to which the Banks have agreed to loan to
Assignor up to $150,000,000 upon the terms and conditions set forth
therein [which Credit Agreement amends and restates in its entirety
that certain Credit Agreement, dated as of October 1, 1989, by and
between Assignor as "Borrower" and National City Bank as Agent for
itself and the other banks (the "Original Banks") (National City
Bank acting in such capacity is hereinafter referred to as the
"Original Agent") which are parties thereto (the "Original Credit
Agreement")];
WHEREAS, to evidence the obligations of Assignor to the Banks
under the Credit Agreement, Assignor has executed and delivered to
the Banks one or more Revolving Credit Notes dated as of the
effective date hereof in the aggregate principal amount of up to
$150,000,000 (the "Notes")[, which Notes replace the notes executed
and delivered by Assignor under the Original Credit Agreement (the
"Original Notes")];
[WHEREAS, Assignor has executed and delivered to the Original
Agent a certain collateral assignment of leases and rents recorded
in Volume ___________, Page ___________, _________ County Records
(the "Original Assignment") to secure to the Original Agent for its
benefit and the ratable benefit of the Original Banks the
obligations of Assignor to the Original Agent and the Original
Banks under the Original Credit Agreement and all other instruments
and agreements evidencing or securing such obligations or otherwise
related thereto;]
[WHEREAS, the Original Agent has assigned to Assignee the
Original Credit Agreement, the Original Assignment, and all other
instruments and agreements evidencing or securing the obligations
of Assignor under the Original Credit Agreement or otherwise
related thereto;]
WHEREAS, Assignor has executed and delivered to Assignee that
certain [Amended and Restated] Open-End Mortgage, Assignment of
Rents and Security Agreement of even date herewith (the "Mortgage")
covering the premises more particularly described in the Mortgage
and in Exhibit A attached hereto (the "Premises"), to secure to
Assignee the obligations of Assignor to the Banks under the Credit
Agreement, the Collateral Documents (as defined in the Credit
Agreement), and all Related Writings (as defined in the Credit
Agreement) (the Notes, the Credit Agreement, this Assignment, the
Collateral Documents and the Related Writings are sometimes
collectively referred to herein as the "Loan Documents");
WHEREAS, Assignee has required as additional security for the
purpose of securing the payment of:
(a) the complete and timely payment of all obligations
of Assignor, and any other obligor under the Loan Documents, now or
hereafter existing under the Loan Documents, whether direct or
indirect, fixed or contingent, including any extensions,
modifications, substitutions, amendments and renewals thereof,
whether for principal, interest, premiums, fees, costs, expenses,
indemnifications or otherwise (all such obligations secured herein
referred to as the "Obligations");
(b) all sums expended or advanced by Assignee pursuant
to any term or provision of the Mortgage or any other Loan
Document;
(c) all advances or disbursements of Assignee with
respect to the Premises for the payment of taxes, levies,
assessments, insurance, insurance premiums or costs incurred in the
protection of the Premises;
(all of such debts and Obligations being collectively referred to
hereinafter as the "Indebtedness"), this Assignment of all leases
now in existence, and those leases and rental agreements which may
come into existence while the Mortgage is in effect, upon the
property covered by the Mortgage, together with all rents and
income due and to become due and payable under said leases and
rental agreements covering the Premises, and Assignor desires to
make such assignment to Assignee as additional security for the
Indebtedness, upon the terms and conditions hereinafter set forth,
which Assignment amends and restates the Original Assignment in its
entirety;
NOW, THEREFORE, for good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, and for
the purposes set forth below, Assignor hereby covenants and agrees
as follows:
Assignor, for and in consideration of the Loans made or to be
made by Assignee to Assignor under the Credit Agreement, and for
other good and valuable consideration, the receipt, sufficiency and
adequacy of which are hereby acknowledged, has granted, transferred
and assigned, and by these presents does grant, sell, transfer, set
over, deliver and assign unto Assignee all those leases and
subleases more particularly described on Exhibit B, attached hereto
and made a part hereof by reference (collectively, the "Operator
Lease"), and any and all documents executed and/or delivered to
Assignor in connection therewith, including, without limitation,
any subordination agreement, lessee estoppel, letter of credit
issued or guaranty executed in favor of Assignor;
TOGETHER with all of Assignor's right, title and interest
in and to all other leases and subleases now in existence (written
or oral), and all other agreements for use or occupancy of any
portion of the Premises, and those leases and subleases and rental
agreements which come into existence while the Mortgage is in
effect, together with any and all guarantees of lessees'
obligations under such leases, and any and all extensions and
renewals thereof;
TOGETHER with any and all amendments, modifications,
extensions and renewals thereof and any and all further leases,
subleases, lettings, sublettings or agreements upon or covering use
of occupancy of all or any part of the Premises (all such leases,
agreements, subleases, tenancies and guarantees heretofore
mentioned as being assigned are hereinafter collectively referred
to as the "Operator Lease Documents");
TOGETHER with the immediate and continuing right to
collect and receive all of the rents, income, receipts, revenues,
issues and profits now due or which may become due or to which
Assignor may now or shall hereafter (including the period of
redemption, if any) become entitled or may demand or claim, arising
or issuing from or out of the Operator Lease Documents or from or
out of the Premises or any part thereof, including but not by way
of limitation: security deposits, minimum rents, additional rents,
percentage rents, parking maintenance, tax and insurance
contributions, deficiency rents and liquidated damages following
default, the premium payable by any lessee upon the exercise of a
cancellation privilege originally provided in any Operator Lease
Document, and all proceeds payable under any policy of insurance
covering loss of rents resulting from untenantability caused by
destruction or damage to the Premises together with any and all
rights and claims of any kind which Assignor may have against any
lessee under the Operator Lease Documents or any sublessees or
occupants of the Premises (all such moneys, rights and claims in
this paragraph described being hereinafter called "Rents");
TOGETHER with all the right, power, and privilege of
Assignor to cancel, terminate, or accept surrender of any Operator
Lease Document, to accept prepayment of more than one monthly
installment of rent thereunder, and to amend, modify, or abridge
any of the terms, covenants, or conditions or any of the Operator
Lease Documents, other than as specifically permitted under the
Credit Agreement;
TO HAVE AND TO HOLD UNTO ASSIGNEE, ITS SUCCESSORS AND
ASSIGNS, FOREVER as security for all Indebtedness and all
liabilities of Assignor to Assignee, and as security for the
performance of all obligations, covenants and agreements of
Assignor under the Mortgage and the other Loan Documents.
Assignor Covenants and Agrees as Follows:
1. Representations and Warranties. Assignor represents and
warrants to Assignee that:
(a) All representations and warranties of Assignor in
Article IV of the Credit Agreement are true and correct with
respect to the Operator Lease Documents.
(b) Except for prior assignments to Assignee, Assignor
has not heretofore made any other assignment of its entire or any
part of its interest in and to any or all of the Operator Lease
Documents or entered into any agreement to subordinate any of the
Operator Lease Documents or Assignor's right to receive any Rents
payable thereunder;
(c) Assignor has not heretofore executed any instrument
or performed any act which may or might prevent Assignee from
enforcing the Operator Lease Documents; and
(d) Assignor has not waived, released, reduced,
discounted or otherwise discharged or compromised any sums due
under the Operator Lease Documents except as previously disclosed
to the Banks in writing.
(e) Assignor is the owner of a good fee simple estate in
the Premises and has good title to the Operator Lease Documents and
Rents hereby assigned and good right to assign the same.
(f) None of the Rents due and issuing from the Premises
or from any part thereof for any period subsequent to one month
from the date hereof have been collected and Assignor has not
received any funds or deposits from any lessee in excess of one
month's rent, except for letters of credit or cash collateral
accounts as disclosed in the Supplemental Schedule to the Credit
Agreement.
(g) each of Assignor and, to the best of Assignor's
knowledge, each tenant under the Operator Lease Documents is in
compliance with all material terms of the Operator Lease Documents
with respect to such tenant's Operator Lease, and no condition
exists which, with the passage of time or the giving of notice or
both, would constitute a default by Assignor or, to the best of
Assignor's knowledge, the tenant under the Operator Lease in any
material respect thereunder.
2. Covenants of Assignor. Assignor covenants and agrees
that:
(a) Assignor shall perform and observe all the material
terms and provisions of each Operator Lease Document and maintain
each Operator Lease Document in full force and effect, and enforce,
to the extent that Assignor, in its reasonable judgment, determines
to be appropriate, each Operator Lease Document in accordance with
its terms if the failure of Assignor to perform, observe or enforce
such Operator Lease Document has resulted or would, more likely
than not, result in a Material Adverse Effect (as defined in the
Credit Agreement). Assignor shall not permit any lessee or
guarantor under any Operator Lease Document to remain in material
default thereof if such default has resulted or would, more likely
than not, result in a Material Adverse Effect.
(b) If Assignor defaults under any Operator Lease
Document, Assignee shall have the right (but not the obligation) to
cure such default within the cure period afforded to Assignor under
such Operator Lease Document or under applicable Law. Any and all
advances, payments, expenses, fees or costs paid or incurred by
Assignee in connection with the cure of any such default, together
with interest thereon at the highest lawful default rate specified
in the Credit Agreement ("Default Rate"), shall be paid by Assignor
to Assignee upon demand therefor, but no payment or act of Assignee
as herein provided shall in any manner release Assignor from its
obligations under this Assignment, or the Note, the Indebtedness,
the Mortgage or any other agreement between the parties.
Assignee, in exercising its right to pay any costs and expenses or
to do any act as herein provided, shall have the power and right to
employ counsel and incur and pay reasonable attorney's fees.
(c) Assignor shall not take or permit any action to
amend, cancel, terminate, waive any provision of, or consent to the
noncompliance with any term of any Operator Lease Document;
provided, however, that Assignor may take any such action so long
as such action (i) does not relate to a material financial
provision of any Operator Lease Document, (ii) does not relate to
any provision in any Operator Lease Document which is expressly for
the benefit of the mortgagor or assignee with respect thereto,
(iii) is taken in the ordinary course of Assignor's business, (iv)
is consistent with Assignor's past practices, (v) would not, more
likely than not, result in a Material Adverse Effect, and (vi) will
not have an adverse effect on the interest (including the
perfection and priority of any security interest or Lien (as
defined in the Credit Agreement) in favor of Assignor or Assignee
and the Banks) of Assignee and the Banks in such agreement or the
assets with respect thereto or otherwise result in a Material
Impairment (as defined in the Credit Agreement).
(d) Except as otherwise provided in this Assignment,
Assignor shall continue to collect, at its own expense, all amounts
due or to become due Assignor under the Operator Lease Documents.
In connection with such collections, Assignor may take such action
as Assignor (and, upon the occurrence and during the continuance of
any Event of Default, at Assignee's direction, shall take such
action as Assignee) may deem necessary or advisable to enforce
collection of the obligations evidenced by the Operator Lease
Documents; provided, however, that such action taken by Assignor
prior to the occurrence of an Event of Default (i) does not violate
any other provision of any Loan Document; (ii) is taken in the
ordinary course of Assignor's business, (iii) is consistent with
Assignor's past practices, (iv) would not, more likely than not,
result in a Material Adverse Effect, and (v) will not have an
adverse effect on the interest (including the perfection and
priority of any security interest or Lien (as defined in the Credit
Agreement) in favor of Assignor or Assignee and the Banks) of
Assignee and the Banks in such agreement or the assets with respect
thereto or otherwise result in a Material Impairment (as defined in
the Credit Agreement).
(e) Assignor shall, at its sole cost and expense, appear
in and defend any and all actions and proceedings arising under,
relating to or in any manner connected with any Operator Lease
Document or the obligations, duties or liabilities of the lessor or
any tenant, lessee or guarantor thereunder.
(f) Assignor shall promptly notify Assignee of any
notice received from any obligor with respect to any claimed
default on the part of the lessor under any Operator Lease
Document.
(g) Assignor covenants that Assignor shall not enter
into any Operator Lease Document for all or any part of the
Premises without the prior written approval of Assignee except as
permitted under the Credit Agreement or the Mortgage. Any Operator
Lease Document for which Assignee's approval is required under the
Credit Agreement or the Mortgage which is not actually approved by
Assignee shall, at the option of Assignee, be null and void and
shall not grant any rights in the Premises to the lessee named
therein.
(h) Assignor hereby agrees and shall request each lessee
of the Premises in its Operator Lease Document to agree, upon
written request of Assignor or Assignee, to join with Assignor in
the execution and delivery to Assignee of a statement in writing
and in form and substance satisfactory to Assignee certifying: (a)
that the Operator Lease Document constitutes the entire agreement
between Assignor and the lessee and is unmodified and in full force
and effect (or if there have been modifications, that the same is
in full force and effect as modified and stating the modification);
(b) that the lessee has accepted possession, and is in possession,
of the premises demised under the Operator Lease Document and is
paying the full rental under the Operator Lease Document; (c) the
dates to which rent, and other charges under the Operator Lease
Document have been paid, and the amount of any security deposited
with Assignor or other landlord of the Premises; (d) that the term
of the Operator Lease Document has commenced; (e) that all work
and improvements described in the Operator Lease Document required
to be performed and constructed by the Landlord therein have been
completed and have been accepted by the lessee; (f) that there is
no default under the Operator Lease Document by Assignor or the
lessee and that there are no defaults or off-sets which the lessee
has against enforcement of the Lease by Assignor; and (g) the
actual commencement date of the Operator Lease Document and the
expiration date of the Operator Lease Document.
(i) Assignor shall notify and direct in writing each and
every present or future lessee or occupant of the Premises or of
any part thereof under one or more Operator Lease Documents which
require a security deposit or other deposit from time to time,
within a reasonable time following the delivery of such security
deposit or other deposits to Assignor, that such deposit(s) have
been retained by Assignor but assigned to Assignee.
(j) Assignor will not convey to any lessee or lessees
the fee title to the Premises or any part thereof unless permitted
under Section 2.08(b) of the Credit Agreement.
(k) This Assignment is given only as collateral
security, and Assignee shall not be obligated to perform or
discharge any obligation or liability of Assignor under any lease
or rental agreement upon the Premises.
(l) Until this Assignment is released or terminated,
Assignor will deliver to Assignee executed copies of the Operator
Lease Documents and any and all other and future Operator Lease
Documents upon all of any part of the Premises and has transferred
and assigned to Assignee, upon the same terms and conditions as
herein contained, such other and future Operator Lease Documents.
Assignor covenants and agrees to make, execute and deliver unto
Assignee upon demand and at any time or times, any and all
assignments and other instruments sufficient for the purpose or
that Assignee may deem to be advisable for carrying out the true
purpose and intent of this Assignment.
3. Present Assignment. Although it is the intention of the
parties that the assignment contained herein is a present
assignment, so long as no Event of Default has occurred hereunder
Assignor shall have the right to collect all sums due under or
secured by the Operator Lease Documents and to retain, use and
enjoy the same. Any such sums collected and received by Assignor
after the occurrence of an Event of Default hereunder shall be
deemed collected and received by Assignor in trust for Assignee,
and Assignor shall account to Assignee for the full amount of such
collections and receipts. Assignee shall have the right to notify
the obligors under the Operator Lease Documents of the existence of
this Assignment at any time.
4. Events of Default. Each of the following shall constitute
an "Event of Default" for purposes of this Assignment:
(a) Assignor shall fail or omit to perform or observe
any provision of Section 2(a) of this Assignment within thirty (30)
Business Days after the giving of written notice to Assignor by
Assignee that it is to be remedied.
(b) Assignor shall fail or omit to perform or observe
any provision of Section 2 of this Assignment other than Section
2(a).
(c) Any representation, warranty or statement made by
Assignor in this Assignment shall be false or erroneous in any
respect when made or deemed made, as the case may be.
(d) An Event of Default shall occur under any other Loan
Document.
5. Rights and Remedies Upon Default. At any time upon or
following the occurrence of any Event of Default hereunder,
Assignee, at its option in accordance with the provisions of the
Credit Agreement and without any obligation to do so, without in
any way waiving such Event of Default, without notice or demand on
Assignor, without regard to the adequacy of the security for the
obligations secured hereby, without releasing Assignor or any
obligor under the Loan Documents from any obligation thereunder,
and with or without bringing any action or proceeding, may do any
or all of the following:
(a) either with or without taking possession of any of
the property encumbered by the Operator Lease Documents, and as
attorney-in-fact, either in Assignee's own name or as agent for
Assignor, demand, sue for, settle, compromise, collect, and give
acquittances for all sums due under or secured by any of the
Operator Lease Documents and pursue all remedies for enforcement of
the Operator Lease Documents and all the secured party's rights
therein and thereunder, provided that, for such purpose, this
Assignment shall constitute an authorization and direction to the
obligors under the Operator Lease Documents to pay all amounts
payable under the Operator Lease Documents to Assignee, without
proof of default hereunder, upon receipt from Assignee of written
notice to thereafter pay all such rents and other amounts to
Assignee and to comply with any notice or demand by Assignee for
observance or performance of any of the covenants, terms,
conditions and agreements contained in the Operator Lease Documents
to be observed or performed by the obligors thereunder, and
provided, further, that Assignor will facilitate Assignee's
collection of such amounts, and upon request will execute written
notices to the obligors under the Operator Lease Documents to
thereafter pay all such amounts to Assignee; and
(b) without regard to the adequacy of the security, with
or without any action or proceeding, through any person or by
agent, or by a receiver to be appointed by court and irrespective
of Assignor's possession, then or thereafter, to enter upon, take
possession of, manage and operate the Premises or any part thereof,
make, modify, enforce, cancel or accept surrender of any Operator
Lease Document now in effect or hereafter in effect on the Premises
or any part thereof; remove and evict any lessee; increase or
reduce rents; decorate, clean and make repairs; perform alterations
and other tenant improvement work; and otherwise do any act or
incur any costs or expense as Assignee shall deem proper to protect
the security hereof, as fully and to the same extent as Assignor
could do if in possession, subject to the terms of the Operator
Lease Documents, and in such event to apply the Rents so collected
to payment of the costs of operation, management and maintenance of
any of the Premises, brokerage and attorneys' fees in connection
therewith, and payment of the Indebtedness; and
(c) make any payment or do any act required herein or in
any Operator Lease Document of Assignor, as attorney-in-fact,
either in Assignee's own name or as agent for Assignor, and in such
manner and to such extent as Assignee may deem necessary in its
sole discretion, and any amount so paid by Assignee shall become
immediately due and payable by Assignor with interest thereon until
paid at the Default Rate and shall be secured by this Assignment.
6. Application of Proceeds. Assignee, in the exercise of its
rights and powers following the occurrence of any Event of Default
shall apply all of the sums collected and received by Assignee in
the manner set forth in the Credit Agreement.
7. Limitation of Assignee's Liability. Acceptance by
Assignee of this Assignment, with all of the rights, powers,
privileges and authority so created, shall not, prior to entry upon
and taking of possession of the Premises by Assignee, be deemed or
construed to constitute Assignee a mortgagee in possession.
Assignee shall not be liable for any loss sustained by Assignor
resulting from any act or omission of Assignee in enforcing any
rights or powers provided for hereunder or under the Operator Lease
Documents following the occurrence of any one or more Events of
Default unless caused by the gross negligence or willful misconduct
of Assignee. Assignee shall not be obligated to observe, perform
or discharge, nor does Assignee hereby undertake to observe,
perform or discharge, any covenant, term, condition or agreement
contained in any Operator Lease Document to be observed or
performed by the secured party thereunder, or any obligation, duty
or liability of Assignor under or by reason of this Assignment, and
Assignor shall and does hereby agree to indemnify and hold Assignee
and the Banks harmless of and from any and all liability, loss or
damage which Assignee incurs under any Operator Lease Document or
by reason of this Assignment and of and from any and all claims and
demands whatsoever which may be asserted against Assignee or any of
the Banks by reason of any alleged obligation or undertaking on its
part to observe or perform any of the covenants, terms, conditions
and agreements contained in any Operator Lease Document by reason
of this Agreement. Should Assignee or any of the Banks incur any
such liability, loss or damage under any Operator Lease Document or
under or by reason of this Assignment, or in the defense of any
such claim or demand, the amount thereof, including costs, expenses
and attorneys' fees and expenses, shall become immediately due and
payable by Assignor to Assignee or such of the banks with interest
thereon at the Default Rate and shall be secured by this
Assignment. This Assignment shall not operate to place
responsibility for the care, control, management or repair of any
premises encumbered by a Operator Lease Document or for the
carrying out of any of the covenants, terms, conditions and
agreements contained in any Operator Lease Document upon Assignee.
Notwithstanding any provision of this Assignment to the contrary,
Assignor's obligation to indemnify and hold Assignee and the Banks
harmless under this Assignment shall not include liability, loss or
damage which Assignee or any of the Banks incurs arising out of its
gross negligence or willful misconduct or arising out of the action
or inaction of Assignee after Assignee or its agent acquires fee
title to the Premises.
8. Non-Waiver. Nothing contained in this Assignment and no
act done or omitted to be done by Assignee pursuant to the rights
and powers granted to it hereunder shall be deemed to be a waiver
by Assignee of its rights and remedies under the Credit Agreement
and any of the other Loan Documents; this Assignment is made and
accepted without prejudice to any of the rights and remedies of
Assignee under the terms and provisions of such instruments; and
Assignee may exercise any of its rights and remedies under the
terms and provisions of such instruments either prior to,
simultaneously with or subsequent to any action taken by it
hereunder. Without limitation of the foregoing, Assignee may take
or release any other security for the performance of the
obligations secured hereby, may release any party primarily or
secondarily liable therefor, and may apply any other security held
by it for the satisfaction of the obligations secured hereby
without prejudice to any of its rights and powers hereunder.
9. Further Assurances. Assignor shall execute or cause to be
executed such additional instruments (including, but not limited
to, general or specific assignments of such Operator Lease Document
as Assignee may designate) and shall do or cause to be done such
further acts, as Assignee may reasonably request, in order to
permit Assignee to perfect, protect, preserve and maintain the
assignment made to Assignee by this Assignment.
10. Severability. Any provision hereof prohibited or invalid
under applicable Law shall be ineffective only to the extent of
such prohibition or invalidity, without invalidating the other
provisions hereof.
11. Successors and Assigns; Assignments. This Assignment is
binding upon Assignor, its successors and assigns, and the rights,
powers and remedies of Assignee under this Assignment shall inure
to the benefit of Assignee and its successors and assigns.
Assignor may not assign its obligations or rights hereunder without
the consent of Assignee and each of the Banks. Each of Assignee
and the Banks may assign its rights hereunder subject to the
limitations set forth in Article VIII of the Credit Agreement.
12. Amendments and Waivers. No amendment or waiver of any
provision of this Assignment, nor consent to any departure by
Assignor therefrom, shall in any event be effective unless the same
shall be in writing and signed by the Majority Banks (as defined in
the Credit Agreement), and then such waiver or consent shall be
effective only in the specific instance and for the specific
purpose for which given; provided, however, that no amendment,
waiver or consent shall, unless in writing and signed by all the
Banks, do any of the following: (a) reduce the principal of, or
interest on, any fees or other amounts payable hereunder, (b)
change the method of computing of interest or any fee, (c) release
any Operator Lease Document from the operation of this Assignment
other than as provided in Section 2.08 of the Credit Agreement, (d)
amend this Section 12 or (e) amend, modify or waive any provision
of this Assignment where such provision requires consent or waiver
by all Banks or any amendment of such a provision which would amend
such requirement of consent by all Banks; and provided, further,
that no amendment, waiver or consent shall, unless in writing and
signed by Assignee in addition to the Banks required above to take
such action, affect the rights or duties of Assignee under this
Assignment.
13. Cumulative Provisions. Each right, power or privilege
specified or referred to in this Assignment is in addition to and
not in limitation of any other rights, powers and privileges that
the Banks and Assignee may respectively otherwise have or acquire
by operation of Law, by other contract or otherwise.
14. Duration; Survival of Provisions. This Assignment shall
not be deemed to be in lieu of or in substitution for the Mortgage
or any other agreement now or hereafter entered into between
Assignor and Assignee, but shall be supplemental thereto. It is
hereby mutually understood and agreed that Assignor has executed
this instrument solely for the purpose of assigning its entire
interests in the Operator Lease Documents including, without
limitation, those described in Exhibit B. This Assignment and
grant shall continue in effect until either (a) all of the
Obligations of Assignor and the other obligors (if any) under the
Loan Documents are fully performed, satisfied and repaid, or (b)
Assignor satisfies the requirements of Section 2.08(b) of the
Credit Agreement with respect to the Premises or Sections 2.08(d)
or 2.08(e) of the Credit Agreement; provided, however, that (y) all
representations and warranties made in or pursuant to this
Assignment shall survive the execution and delivery of this
Assignment, and (z) the indemnification provisions set forth in
this Assignment shall survive the performance, satisfaction and
repayment of the Obligations.
15. Governing Law. This Assignment and the respective rights
and obligations of the parties hereto shall be governed by and
construed in accordance with the internal laws of the State of Ohio
(without giving effect to the conflict of laws rules thereof),
except to the extent that the perfection and enforcement of the
lien and security interest granted hereunder must be subject to the
laws governing the Operator Lease Documents.
16. Notices. All notices and other communications provided
for hereunder shall be in writing (including telecopier,
telegraphic, telex or cable communication) and mailed, telecopied,
telegraphed, telexed, cabled or delivered, to the intended
recipient at its address set forth in the preamble to this
Assignment; or, as to any party, at such other address as shall be
designated by such party in a written notice to each of the other
parties. All such notices and communications shall, when mailed,
telecopied, telegraphed, telexed or cabled, be effective when
deposited in the mails, telecopied, delivered to the telegraph
company, confirmed by telex answerback or delivered to the cable
company, respectively, except that notices and communications to
Assignee pursuant to Section 4 shall not be effective until
received by Assignee.
17. WAIVER OF JURY TRIAL. THE PARTIES ACKNOWLEDGE AND AGREE
THAT ANY CONTROVERSY THAT MAY ARISE UNDER THIS ASSIGNMENT OR THE
OTHER LOAN DOCUMENTS WOULD INVOLVE DIFFICULT AND COMPLEX ISSUES AND
THEREFORE AGREE THAT ANY LAW SUIT GROWING OUT OF OR INCIDENTAL TO
ANY SUCH CONTROVERSY WILL BE TRIED IN A COURT OF COMPETENT
JURISDICTION BY A JUDGE SITTING WITHOUT A JURY. ASSIGNOR CONFIRMS
THAT THE FOREGOING WAIVER IS INFORMED AND FREELY MADE.
18. Jurisdiction; Venue, Inconvenient Forum.
(a) EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY AND
UNCONDITIONALLY SUBMITS, FOR ITSELF AND ITS PROPERTY, TO THE
NONEXCLUSIVE JURISDICTION OF ANY OHIO STATE COURT OR FEDERAL COURT
OF THE UNITED STATED OF AMERICA SITTING IN CUYAHOGA COUNTY, OHIO,
AND ANY APPELLATE COURT FROM ANY THEREOF, IN ANY ACTION OR
PROCEEDING ARISING OUT OF OR RELATING TO THIS ASSIGNMENT, THE
CREDIT AGREEMENT, ANY COLLATERAL DOCUMENT OR ANY RELATED WRITING OR
FOR RECOGNITION OR ENFORCEMENT OF ANY JUDGMENT, AND EACH OF THE
PARTIES HERETO HEREBY IRREVOCABLY AND UNCONDITIONALLY AGREES THAT
ALL CLAIMS IN RESPECT OF ANY SUCH ACTION OR PROCEEDING MAY BE HEARD
AND DETERMINED IN ANY SUCH OHIO STATE OR, TO THE EXTENT PERMITTED
BY LAW, IN SUCH FEDERAL COURT. EACH OF THE PARTIES HERETO AGREES
THAT A FINAL JUDGMENT IN ANY SUCH ACTION OR PROCEEDING SHALL BE
CONCLUSIVE AND MAY BE ENFORCED IN OTHER JURISDICTIONS BY SUIT ON
THE JUDGMENT OR IN ANY OTHER MANNER PROVIDED BY LAW. NOTHING IN
THIS AGREEMENT SHALL AFFECT ANY RIGHT THAT ANY PARTY MAY OTHERWISE
HAVE TO BRING ANY ACTION OR PROCEEDING RELATING TO THIS ASSIGNMENT,
THE CREDIT AGREEMENT, ANY COLLATERAL DOCUMENT OR ANY RELATED
WRITING IN THE COURTS OF ANY JURISDICTION.
(b) EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY AND
UNCONDITIONALLY WAIVES, TO THE FULLEST EXTENT IT MAY LEGALLY AND
EFFECTIVELY DO SO, ANY OBJECTION THAT IT MAY NOW OR HEREAFTER HAVE
TO THE LAYING OF VENUE OF ANY SUIT, ACTION OR PROCEEDING ARISING
OUT OF OR RELATING TO THIS ASSIGNMENT, THE CREDIT AGREEMENT, ANY
COLLATERAL DOCUMENT OR ANY OTHER RELATED WRITING IN ANY OHIO STATE
OR FEDERAL COURT SITTING IN OHIO. EACH OF THE PARTIES HERETO HEREBY
WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW, THE DEFENSE OF AN
INCONVENIENT FORUM TO THE MAINTENANCE OF SUCH ACTION OR PROCEEDING
IN ANY SUCH COURT. ASSIGNOR CONFIRMS THAT THE FOREGOING WAIVERS
ARE INFORMED AND FREELY MADE.
19. Miscellaneous. The headings of each section of this
Assignment are for convenience only and shall not define or limit
the provisions thereof. This Assignment and all rights and
obligations hereunder shall be binding upon Assignor and its
successors and assigns, and shall inure to the benefit of Assignee
and its successors and assigns. If any term of this Assignment
shall be held to be invalid, illegal or unenforceable, the validity
of all other terms hereof shall in no way be affected thereby, and
this Assignment shall be construed and be enforceable as if such
invalid, illegal or unenforceable term had not been included
herein.
20. Certain Defined Terms. As used herein, the term
"Assignee" means National City Bank, a national banking
association, acting in its capacity as agent for its benefit and
the ratable benefit of the Banks, together with its successors and
assigns in such capacity, and the term "Banks" means National City
Bank and certain other banks as set forth in the Credit Agreement,
and such other banks as may become parties to the Credit Agreement
from time to time, together with their respective successors and
assigns.
IN WITNESS WHEREOF, Assignor has caused this Assignment to be
executed by its officers or agents thereunto duly authorized, as of
the date first above written.
Signed, sealed and delivered HEALTH CARE REIT, INC., a
in the presence of: Delaware corporation
By:--------------------------
- - - --------------------------- Name:------------------------
(Witness to both signatures)
Title:-----------------------
- - - ---------------------------
Print Name
By:--------------------------
- - - --------------------------- Name:------------------------
(Witness to both signatures)
Title:-----------------------
- - - ---------------------------
Print Name
STATE OF OHIO )
) SS:
COUNTY OF ________ )
BEFORE ME, a Notary Public in and for said County,
personally appeared the above named HEALTH CARE REIT, INC., a
Delaware corporation, by ________, its ____ and ______, its
____________, who acknowledged that they did sign the foregoing
Assignment of Leases and Rents and that the same is the free act
and deed of said corporation and the free act and deed of them
personally and as such officers.
IN TESTIMONY WHEREOF, I have hereunto set my hand and
official seal at _______________, Ohio this _____ day of
__________, 1994.
___________________________________
Notary Public
My commission expires:_____________
This Instrument Prepared by:
Calfee, Halter & Griswold
Suite 1800
800 Superior Avenue
Cleveland, Ohio 44114-2688
(216) 622-8200
<PAGE>
EXHIBIT A
Legal Description of the Premises
<PAGE>
EXHIBIT B
Existing Operator Lease Documents
<PAGE>
EXHIBIT C
Permitted Encumbrances
EXHIBIT L-1
FORM OF SECURITY AGREEMENT (GENERAL INTANGIBLES)
This SECURITY AGREEMENT (GENERAL INTANGIBLES) (this
"Agreement") is made as of this 8th day of September, 1994, by
HEALTH CARE REIT, INC., a Delaware corporation ("Borrower"), One
SeaGate, Suite 1950, Toledo, Ohio 43603, in favor of NATIONAL CITY
BANK, a national banking association, as Agent (together with its
successors and assigns in such capacity, the "Agent"), National
City Center, 1900 East Ninth Street, Metro Division, Cleveland,
Ohio 44114, for the ratable benefit of itself and the Banks (as
defined below) from time to time parties to the Credit Agreement
(as such term is hereinafter defined).
RECITALS
WHEREAS, Borrower has entered into that certain Amended and
Restated Credit Agreement, dated as of the effective date hereof
(as the same may be supplemented, amended, restated, modified or
substituted from time to time, the "Credit Agreement"; capitalized
terms used herein without definition have the meanings ascribed to
such terms in the Credit Agreement), with National City Bank and
certain other banks as set forth in the Credit Agreement and their
successors and assigns (hereinafter collectively referred to as the
"Banks") and Agent as agent for the Banks (in such capacity
hereinafter referred to as the "Agent" or "Secured Party"),
pursuant to which the Banks have agreed to make certain financial
accommodations to Borrower upon the terms and conditions set forth
therein;
WHEREAS, Borrower has executed and delivered to the Agent for
the ratable benefit of the Banks this Agreement to secure to the
Agent for the ratable benefit of the Banks the obligations of
Borrower to the Banks under the Credit Agreement, the Notes (as
defined in the Credit Agreement), the Collateral Documents (as
defined in the Credit Agreement), and all Related Writings (as
defined in the Credit Agreement) (the Notes, the Credit Agreement,
this Agreement, the Collateral Documents and the Related Writings
are sometimes collectively referred to herein as the "Loan
Documents");
NOW, THEREFORE, for good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, and for
the purposes set forth below, Borrower hereby covenants and agrees
as follows:
1. Grant of Security. Borrower hereby assigns and pledges to
the Agent for its benefit and the ratable benefit of the Banks, and
hereby grants to the Agent for its benefit and the ratable benefit
of the Banks, a security interest in, the following (collectively,
the "Collateral"): (a) all of Borrower's right, title and interest,
whether now owned or hereafter acquired, in and to all instruments
(as defined in Article 9 of the Uniform Commercial Code as in
effect from time to time in the State of Ohio (the "UCC")) and
general intangibles (as defined in the UCC) of any kind, now or
hereafter existing, and all rights now or hereafter existing in and
to all security agreements, mortgages, pledge agreements, loan
agreement, leases, certificates and other contracts securing or
guarantying or otherwise relating to or comprising any such
instruments or general intangibles, (x) arising out of or in
connection with and limited to Borrower's Operator Loans (as
defined in the Credit Agreement) or Operator Leases (as defined in
the Credit Agreement) with respect to the Operators and Health Care
Facilities (as each is defined in the Credit Agreement) set forth
on Schedule I hereto (as the same may be amended from time to time
pursuant to Section 14 hereof) and (y) including, without
limitation, (i) all of Borrower's right, title and interest in and
to each of the agreements listed on Schedule II (as the same may be
amended from time to time in connection with Section 14 hereof) and
each other agreement executed by any of the Operators or any
guarantor thereof in respect of the Health Care Facilities set
forth on Schedule I in favor of the Borrower or to which Borrower
is now or may hereafter become a party, in each case as such
agreements may be amended or otherwise modified from time to time
(collectively, the "Operator Documents"), (ii) all rights of
Borrower to receive moneys due and to become due under or pursuant
to the Operator Documents, (iii) all rights of Borrower to receive
proceeds of any insurance, indemnity, warranty or guaranty with
respect to the Operator Documents, (iv) claims of Borrower for
damages arising out of or for breach of or default under the
Operator Documents and (v) the right of Borrower to terminate the
Operator Documents, to perform thereunder and to compel performance
and otherwise exercise all remedies thereunder; and (b) all
proceeds of any and all of the foregoing Collateral (including,
without limitation, proceeds that constitute property of the types
described in clause (a) of this Section 1 and, to the extent not
otherwise included, all (x) payments under insurance (whether or
not the Agent is the loss payee thereof), or any indemnity,
warranty or guaranty, payable by reason of loss or damage to or
otherwise with respect to any of the foregoing Collateral and (y)
cash.
2. Obligations. This Agreement secures the complete and
timely payment of all principal and interest on any Loans made
under the Credit Agreement (including, without limitation, all
amounts which would become due but for the operation of the
automatic stay under Section 362(a) of the United States Bankruptcy
Code, 11 USC Section 362(a), and the operation of Sections 502(b) and
506(b) of the United States Bankruptcy Code, 11 USC Section 502(b) and
Section 506(b)), all liabilities under any hedge agreement, swap agreement
or similar agreement between the Borrower and any Bank, all
liability of the Borrower under Article VII and Article IX of the
Credit Agreement, and all fees and other liabilities, payable to
the Banks or the Agent or any thereof by the Borrower pursuant to
this Agreement, the Credit Agreement, the Collateral Documents or
any Related Writing (all such obligations secured herein referred
to as the "Obligations").
3. Representations and Warranties. Borrower represents and
warrants to the Agent that:
(a) All applicable representations and warranties of
Borrower in Article IV of the Credit Agreement are true and correct
with respect to the Operator Documents and the Collateral.
(b) Except for prior assignments to the Agent, Borrower
has not heretofore made any other assignment of its entire or any
part of its interest in and to any or all of the Operator Documents
or other Collateral or entered into any agreement to subordinate
any of the Operator Documents or Borrower's right to receive any
amounts payable thereunder.
(c) Borrower has not heretofore executed any instrument
or performed any act which may or might prevent the Agent from
enforcing the Operator Documents.
(d) Borrower has not waived, released, reduced,
discounted or otherwise discharged or compromised any sums due
under or secured by the Operator Documents except as previously
disclosed to the Banks in writing.
4. Covenants of Borrower. Borrower covenants and agrees
that:
(a) Borrower shall perform and observe all the material
terms and provisions of each Operator Document and maintain each
Operator Document in full force and effect, and enforce, to the
extent that Borrower, in its reasonable judgment, determines to be
appropriate, each Operator Document in accordance with its terms if
the failure of Borrower to perform, observe or enforce such
Operator Document has neither resulted nor would, more likely than
not, result in a Material Adverse Effect (as defined in the Credit
Agreement). Borrower shall not permit any obligor under any
Operator Document to remain in material default thereof if such
default has resulted or would, more likely than not, result in a
Material Adverse Effect.
(b) If Borrower defaults under any Operator Document,
the Agent shall have the right (but not the obligation) to cure
such default within the cure period afforded to Borrower under such
Operator Document or under applicable Law. Any and all advances,
payments, expenses, fees or costs paid or incurred by the Agent in
connection with the cure of any such default, together with
interest thereon at the highest lawful default rate specified in
the Credit Agreement ("Default Rate"), shall be paid by Borrower to
the Agent upon demand therefor.
(c) Borrower shall not take or permit any action to
amend, cancel, terminate, waive any provision of, or consent to the
noncompliance with any term of any Operator Document; provided,
however, that Borrower may take any such action so long as such
action (i) does not relate to a material financial provision of any
Operator Document, (ii) does not relate to any provision in any
Operator Document which provision is expressly for the benefit of
the mortgagor or assignee with respect thereto, (iii) is taken in
the ordinary course of Borrower's business, (iv) is consistent with
Borrower's past practices, (v) would not, more likely than not,
result in a Material Adverse Effect, and (vi) will not have an
adverse effect on the interest (including the perfection and
priority of any security interest or Lien (as defined in the Credit
Agreement) in favor of Borrower or the Agent and the Banks) of the
Agent for the benefit of the Banks in such agreement or the assets
with respect thereto or otherwise result in a Material Impairment
(as defined in the Credit Agreement).
(d) Except as otherwise provided in this Agreement,
Borrower shall continue to collect, at its own expense, all amounts
due or to become due Borrower under the Operator Documents. In
connection with such collections, Borrower may take such action as
Borrower (and, upon the occurrence and during the continuance of
any Event of Default, at the Agent's direction, shall take such
action as the Agent) may deem necessary or advisable to enforce
collection of the obligations evidenced by the Operator Documents;
provided, however, that such action taken by Borrower prior to the
occurrence of an Event of Default (i) does not violate any other
provision of any Loan Document; (ii) is taken in the ordinary
course of Borrower's business, (iii) is consistent with Borrower's
past practices, (iv) would not, more likely than not, result in a
Material Adverse Effect, and (v) will not have an adverse effect on
the interest (including the perfection and priority of any security
interest or Lien (as defined in the Credit Agreement) in favor of
Borrower or the Agent and the Banks) of the Agent for the benefit
of the Banks in such agreement or the assets with respect thereto
or otherwise result in a Material Impairment (as defined in the
Credit Agreement).
(e) Borrower shall, at its sole cost and expense, appear
in and defend any and all actions and proceedings arising under,
relating to or in any manner connected with any Operator Document
or the obligations, duties or liabilities of the lessor or any
tenant, lessee or guarantor thereunder.
(f) Borrower shall promptly notify the Agent of any
notice received from any obligor with respect to any claimed
default on the part of the secured party under any Operator
Document.
5. Borrower's Right to Collect. So long as no Event of
Default has occurred hereunder Borrower shall have the right to
collect all sums due under or secured by the Operator Documents and
to retain, use and enjoy the same. Any such sums collected and
received by Borrower after the occurrence of an Event of Default
hereunder shall be deemed collected and received by Borrower in
trust for the Agent, and Borrower shall account to the Agent for
the full amount of such collections and receipts. The Agent shall
have the right to notify the obligors under the Operator Documents
of the existence of this Agreement at any time.
6. Events of Default. Each of the following shall constitute
an "Event of Default" for purposes of this Agreement:
(a) Borrower shall fail to perform or observe any
provision of Section 4(a) of this Agreement within thirty (30)
Business Days after the giving of notice to Borrower by the Agent
that it is to be remedied.
(b) Borrower shall fail or omit to perform or observe
any provision of Section 4 of this Agreement other than Section
4(a).
(c) Any representation, warranty or statement made by
Borrower in this Agreement shall be false or erroneous in any
respect when made or deemed made, as the case may be.
(d) An Event of Default shall occur under any other Loan
Document.
7. Rights and Remedies Upon Default. At any time upon or
following the occurrence of any Event of Default hereunder, the
Agent, at its option in accordance with the provisions of the
Credit Agreement and without any obligation to do so, without in
any way waiving such Event of Default, without notice or demand on
Borrower, without regard to the adequacy of the security for the
obligations secured hereby, without releasing Borrower or any
obligor under the Loan Documents from any obligation thereunder,
and with or without bringing any action or proceeding, may do any
or all of the following:
(a) either with or without taking possession of any of
the property encumbered by the Operator Documents, and as attorney-
in-fact, either in the Agent's own name or as agent for Borrower,
demand, sue for, settle, compromise, collect, and give acquittances
for all sums due under or secured by any of the Operator Documents
and pursue all remedies for enforcement of the Operator Documents
and all the secured party's rights therein and thereunder, provided
that, for such purpose, this Agreement shall constitute an
authorization and direction to the obligors under the Operator
Documents to pay all amounts payable under the Operator Documents
to the Agent, without proof of default hereunder, upon receipt from
the Agent of written notice to thereafter pay all such amounts and
other amounts to the Agent and to comply with any notice or demand
by the Agent for observance or performance of any of the covenants,
terms, conditions and agreements contained in the Operator
Documents to be observed or performed by the obligors thereunder,
and provided, further, that Borrower will facilitate the Agent's
collection of such amounts, and upon request will execute written
notices to the obligors under the Operator Documents to thereafter
pay all such amounts to the Agent;
(b) make any payment or do any act required herein of
Borrower, as attorney-in-fact, either in the Agent's own name or as
agent for Borrower, and in such manner and to such extent as the
Agent may deem necessary in its sole discretion, and any amount so
paid by the Agent shall become immediately due and payable by
Borrower with interest thereon until paid at the Default Rate and
shall be secured by this Agreement; and
(c) take any other action permitted by law or any other
Loan Document.
8. Application of Proceeds. The Agent, in the exercise of
its rights and powers following the occurrence of any Event of
Default shall apply all of the sums collected and received by the
Agent in the manner set forth in the Credit Agreement.
9. Limitation of the Agent's Liability; Indemnification. The
Agent shall not be liable for any loss sustained by Borrower
resulting from any act or omission of the Agent in enforcing any
rights or powers provided for hereunder or under the Operator
Documents following the occurrence of any one or more Events of
Default unless caused by the gross negligence or willful misconduct
of the Agent. The Agent shall not be obligated to observe, perform
or discharge, nor does the Agent hereby undertake to observe,
perform or discharge, any covenant, term, condition or agreement
contained in any Operator Document to be observed or performed by
the secured party thereunder, or any obligation, duty or liability
of Borrower under or by reason of this Agreement, and Borrower
shall and does hereby agree to indemnify and hold the Agent and the
Banks harmless of and from any and all liability, loss or damage
which the Agent incurs under any Operator Document or by reason of
this Agreement and of and from any and all claims and demands
whatsoever which may be asserted against the Agent or any of the
Banks by reason of any alleged obligation or undertaking on its
part to observe or perform any of the covenants, terms, conditions
and agreements contained in any Operator Document by reason of this
Agreement. Should the Agent or any of the Banks incur any such
liability, loss or damage under any Operator Document or under or
by reason of this Agreement, or in the defense of any such claim or
demand, the amount thereof, including costs, expenses and
attorneys' fees and expenses, shall become immediately due and
payable by Borrower to the Agent or any of the Banks with interest
thereon at the Default Rate and shall be secured by this Agreement.
This Agreement shall not operate to place responsibility for the
care, control, management or repair of any premises encumbered by
a Operator Document or for the carrying out of any of the
covenants, terms, conditions and agreements contained in any
Operator Document upon the Agent. Notwithstanding any provision of
this Agreement to the contrary, Borrower's obligation to indemnify
and hold the Agent and the Banks harmless under this Agreement
shall not include liability, loss or damage which the Agent or any
of the Banks incurs arising out of its gross negligence or willful
misconduct or arising out of the action or inaction of the Agent or
its agent with respect to (i) an Operator Lease (and related
documents) after the Agent or its agent becomes the "lessor" with
respect thereto or (ii) an Operator Loan (and related documents)
after the Agent or its agent becomes the "lender" with respect
thereto.
10. Non-Waiver. Nothing contained in this Agreement and no
act done or omitted to be done by the Agent pursuant to the rights
and powers granted to it hereunder shall be deemed to be a waiver
by the Agent of its rights and remedies under the Credit Agreement
and any of the other Loan Documents; this Agreement is made and
accepted without prejudice to any of the rights and remedies of the
Agent under the terms and provisions of such instruments; and the
Agent may exercise any of its rights and remedies under the terms
and provisions of such instruments either prior to, simultaneously
with or subsequent to any action taken by it hereunder. Without
limitation of the foregoing, the Agent may take or release any
other security for the performance of the obligations secured
hereby, may release any party primarily or secondarily liable
therefor, and may apply any other security held by it for the
satisfaction of the obligations secured hereby without prejudice to
any of its rights and powers hereunder.
11. Delivery of Instruments; Further Assurances. Borrower
shall deliver or cause to be delivered to the Agent for the benefit
of the Banks originals of any of the Operator Documents
constituting instruments (as defined in Article 9 of the UCC).
Borrower shall execute or cause to be executed such additional
instruments and shall do or cause to be done such further acts, as
the Agent may reasonably request, in order to permit the Agent to
perfect, protect, preserve and maintain the security interest
granted to the Agent for the benefit of the Banks by this
Agreement, including, but not limited to (i) general or specific
assignments of such Operator Documents as the Agent may designate,
(ii) UCC-1 financing statements naming Borrower as debtor and the
Agent as Secured Party for the benefit of the Banks and (iii) UCC-1
assignments of any financing statements filed in favor of Borrower
in respect of any of the Operator Documents or the obligations to
the Borrower secured thereby.
12. Severability. Any provision hereof prohibited or invalid
under applicable Law shall be ineffective only to the extent of
such prohibition or invalidity, without invalidating the other
provisions hereof.
13. Successors and Assigns; Assignments. This Agreement is
binding upon Borrower, its successors and assigns, and the rights,
powers and remedies of the Agent under this Agreement shall inure
to the benefit of the Agent for the benefit of the Banks and its
successors and assigns. The Borrower may not assign its
obligations or rights hereunder without the consent of the Agent
and each of the Banks. Each of the Agent and the Banks may assign
its rights hereunder subject to the limitations set forth in
Article VIII of the Credit Agreement.
14. Amendments and Waivers. No amendment or waiver of any
provision of this Agreement, nor consent to any departure by
Borrower therefrom, shall in any event be effective unless the same
shall be in writing and signed by the Majority Banks (as defined in
the Credit Agreement), and then such waiver or consent shall be
effective only in the specific instance and for the specific
purpose for which given; provided, however, that no amendment,
waiver or consent shall, unless in writing and signed by all the
Banks, as to any of the matters set forth in Section 10.01 of the
Credit Agreement; provided, further, that, this Agreement may be
amended by the Borrower, without the signature of the Agent or any
Bank, so long as such is substantially in the form of Exhibit L-2
to the Credit Agreement and is for the purpose of amending Schedule
I to add additional Operators or Health Care Facilities and/or
amending Schedule II to add additional documents as Collateral as
required by Section 3.03 of the Credit Agreement in respect of
Operator Loans or Operator Leases which are or are to become
Collateral, including, without limitation, Cross-Collateralized
Loans. Notwithstanding the foregoing, the Borrower may not add
additional documents as Collateral in respect of Operator Loans or
Operator Leases which are not Eligible Operator Loans or Eligible
Operator Leases unless (i) the Borrower has complied with the
provisions of Section 2.09(a) of the Credit Agreement and the
Majority Banks have consented to such addition pursuant to such
section or (ii) such documents are in respect of Operator Loans
which are Cross-Collateralized Loans.
15. Cumulative Provisions. Each right, power or privilege
specified or referred to in this Agreement is in addition to and
not in limitation of any other rights, powers and privileges that
the Banks and the Agent may respectively otherwise have or acquire
by operation of Law, by other contract or otherwise.
16. Duration; Survival of Provisions. This Agreement and
grant shall continue in effect until either (i) all of the
Obligations of Borrower and the other obligors (if any) under the
Loan Documents are fully performed, satisfied and repaid or (ii)
Borrower satisfies the requirements of Section 2.08(b) of the
Credit Agreement with respect to the Premises or Sections 2.08(d)
or 2.08(e) of the Credit Agreement; provided, however, that (a) all
representations and warranties made in or pursuant to this
Agreement shall survive the execution and delivery of this
Agreement, and (b) the indemnification provisions set forth in this
Agreement shall survive the performance, satisfaction and repayment
of the Obligations.
17. Governing Law. This Agreement and the respective rights
and obligations of the parties hereto shall be governed by and
construed in accordance with the internal laws of the State of Ohio
(without giving effect to the conflict of laws rules thereof),
except to the extent that the perfection and enforcement of the
lien and security interest granted hereunder must be subject to the
laws governing the Operator Documents.
18. Notices. All notices and other communications provided
for hereunder shall be in writing (including telecopier,
telegraphic, telex or cable communication) and mailed, telecopied,
telegraphed, telexed, cabled or delivered, to the intended
recipient at its address set forth in the preamble to this
Agreement; or, as to any party, at such other address as shall be
designated by such party in a written notice to each of the other
parties. All such notices and communications shall, when mailed,
telecopied, telegraphed, telexed or cabled, be effective when
deposited in the mails, telecopied, delivered to the telegraph
company, confirmed by telex answerback or delivered to the cable
company, respectively, except that notices and communications to
the Agent pursuant to Section 6 shall not be effective until
received by the Agent.
19. Waiver of Jury Trial. THE PARTIES ACKNOWLEDGE AND AGREE
THAT ANY CONTROVERSY THAT MAY ARISE UNDER THIS AGREEMENT, THE
COLLATERAL DOCUMENTS OR THE RELATED WRITINGS WOULD INVOLVE
DIFFICULT AND COMPLEX ISSUES AND THEREFORE AGREE THAT ANY LAW SUIT
GROWING OUT OF OR INCIDENTAL TO ANY SUCH CONTROVERSY WILL BE TRIED
IN A COURT OF COMPETENT JURISDICTION BY A JUDGE SITTING WITHOUT A
JURY. THE BORROWER ACKNOWLEDGES THAT THIS WAVIER IS INFORMED AND
FREELY MADE.
20. Jurisdiction; Venue; Inconvenient Forum.
(a) Jurisdiction. EACH OF THE PARTIES HERETO HEREBY
IRREVOCABLY AND UNCONDITIONALLY SUBMITS, FOR ITSELF AND ITS
PROPERTY, TO THE NONEXCLUSIVE JURISDICTION OF ANY OHIO STATE COURT
OR FEDERAL COURT OF THE UNITED STATED OF AMERICA SITTING IN
CUYAHOGA COUNTY, OHIO, AND ANY APPELLATE COURT FROM ANY THEREOF, IN
ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS
AGREEMENT, THE COLLATERAL DOCUMENTS OR ANY RELATED WRITING, OR FOR
RECOGNITION OR ENFORCEMENT OF ANY JUDGMENT, AND EACH OF THE PARTIES
HERETO HEREBY IRREVOCABLY AND UNCONDITIONALLY AGREES THAT ALL
CLAIMS IN RESPECT OF ANY SUCH ACTION OR PROCEEDING MAY BE HEARD AND
DETERMINED IN ANY SUCH OHIO STATE OR, TO THE EXTENT PERMITTED BY
LAW, IN SUCH FEDERAL COURT. EACH OF THE PARTIES HERETO AGREES THAT
A FINAL JUDGMENT IN ANY SUCH ACTION OR PROCEEDING SHALL BE
CONCLUSIVE AND MAY BE ENFORCED IN OTHER JURISDICTIONS BY SUIT ON
THE JUDGMENT OR IN ANY OTHER MANNER PROVIDED BY LAW. NOTHING IN
THIS AGREEMENT SHALL AFFECT ANY RIGHT THAT ANY PARTY MAY OTHERWISE
HAVE TO BRING ANY ACTION OR PROCEEDING RELATING TO THIS AGREEMENT,
ANY COLLATERAL DOCUMENT OR ANY RELATED WRITING IN THE COURTS OF ANY
JURISDICTION.
(b) Venue; Inconvenient Forum. EACH OF THE PARTIES
HERETO HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVES, TO THE
FULLEST EXTENT IT MAY LEGALLY AND EFFECTIVELY DO SO, ANY OBJECTION
THAT IT MAY NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY
SUIT, ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS
AGREEMENT, ANY COLLATERAL DOCUMENT OR ANY OTHER RELATED WRITING IN
ANY OHIO STATE OR FEDERAL COURT SITTING IN CUYAHOGA COUNTY, OHIO.
EACH OF THE PARTIES HERETO HEREBY WAIVES, TO THE FULLEST EXTENT
PERMITTED BY LAW, THE DEFENSE OF AN INCONVENIENT FORUM TO THE
MAINTENANCE OF SUCH ACTION OR PROCEEDING IN ANY SUCH COURT. THE
BORROWER CONFIRMS THAT THE FOREGOING WAIVERS ARE INFORMED AND
FREELY MADE.
21. Miscellaneous. The headings of each section of this
Agreement are for convenience only and shall not define or limit
the provisions thereof. If any term of this Agreement shall be held
to be invalid, illegal or unenforceable, the validity of all other
terms hereof shall in no way be affected thereby, and this
Agreement shall be construed and be enforceable as if such invalid,
illegal or unenforceable term had not been included herein.
IN WITNESS WHEREOF, Borrower has caused this Agreement to be
executed by its officers or agents thereunto duly authorized, as of
the date first above written.
HEALTH CARE REIT, INC., a
Delaware corporation
By:------------------------------
Name:----------------------------
Title:---------------------------
One SeaGate, Suite 1950
Toledo, Ohio 43604
<PAGE>
Schedule I
to
Security Agreement (General Intangibles)
Health Care Facilities and the Operators related thereto:
Operator Health Care Facility
<PAGE>
Schedule II
to
Security Agreement (General Intangibles)
Operator Documents:
[Each of the agreements executed by the following Operator in
respect of the following Health Care Facility (or any guarantor of
such Operator) in favor of Borrower, including without limitation,
the following:
1. Note
2. Loan Agreement
3. Mortgage
4. Guaranty ...
[Each of the agreements executed by the following Operator in
respect of the following Health Care Facility (or any guarantor of
such Operator) in favor of Borrower, including without limitation,
the following:
1. Lease Agreement
3. Guaranty ...
EXHIBIT L-2
FORM OF AMENDMENT [No. ______]
TO
SECURITY AGREEMENT (GENERAL INTANGIBLES)
This Amendment No. __ to Security Agreement (General
Intangibles (this "Amendment"), is made as of this _____ day of
____________, 1994 by HEALTH CARE REIT, INC., a Delaware
corporation ("Borrower"), One SeaGate, Suite 1950, Toledo, Ohio
43603, in favor of NATIONAL CITY BANK, a national banking
association, as Agent (together with its successors and assigns in
such capacity, the "Agent"), National City Center, 1900 East Ninth
Street, Metro Division, Cleveland, Ohio 44114, for the ratable
benefit of itself and the Banks (as defined below) from time to
time parties to the Credit Agreement (as such term is hereinafter
defined).
RECITALS
WHEREAS, Borrower has entered into that certain Amended and
Restated Credit Agreement dated as of September 8, 1994 (as the
same may be supplemented, amended, restated, modified or
substituted from time to time, the "Credit Agreement") with
National City Bank and certain other banks as set forth in the
Credit Agreement and their successors and assigns (hereinafter
collectively referred to as the "Banks") and Agent as agent for the
Banks (in such capacity hereinafter referred to as the "Agent" or
"Secured Party"), pursuant to which the Banks have agreed to make
certain financial accommodations to Borrower upon the terms and
conditions set forth therein;
WHEREAS, Borrower has executed and delivered to the Agent for
the ratable benefit of the Banks a Security Agreement (General
Intangibles), dated as of September 8, 1994 (as the same may be
supplemented, amended, restated, modified or substituted from time
to time, the "Security Agreement"; capitalized terms used herein
without definition have the meanings ascribed to such terms in the
Security Agreement) to secure to the Agent for the ratable benefit
of the Banks the obligations of Borrower to the Banks under the
Credit Agreement, the Notes (as defined in the Credit Agreement),
the Collateral Documents (as defined in the Credit Agreement), and
all Related Writings (as defined in the Credit Agreement) (the
Notes, the Credit Agreement, this Agreement, the Collateral
Documents and the Related Writings are sometimes collectively
referred to herein as the "Loan Documents");
WHEREAS, in order to (i) reaffirm the security interest of the
Agent for the ratable benefit of the Banks in the Collateral and
(ii) grant to the Agent for the benefit of the Banks by amendment
a security interest in certain Collateral (as defined in the
Security Agreement) to be added as Collateral (as defined in the
Credit Agreement) subsequent to the date of the Security Agreement,
Section 14 of the Security Agreement and Section 3.03 of the Credit
Agreement provides for the execution and delivery, from time to
time, of Amendments to Security Agreement:
NOW, THEREFORE, for good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, and for
the purposes set forth below, Borrower hereby covenants and agrees
as follows:
1. Grant of Security. Borrower hereby assigns and pledges to
the Agent for its benefit and the ratable benefit of the Banks, and
hereby grants to the Agent for its benefit and the ratable benefit
of the Banks, a security interest in, the following (collectively,
the "Collateral"): (a) all of Borrower's right, title and interest,
whether now owned or hereafter acquired, in and to all instruments
(as defined in Article 9 of the Uniform Commercial Code as in
effect from time to time in the State of Ohio (the "UCC")) and
general intangibles (as defined in the UCC) of any kind, now or
hereafter existing, and all rights now or hereafter existing in and
to all security agreements, mortgages, pledge agreements, loan
agreement, leases, certificates and other contracts securing or
guarantying or otherwise relating to or comprising any such
instruments or general intangibles, (x) arising out of or in
connection with and limited to Borrower's Operator Loans (as
defined in the Credit Agreement) or Operator Leases (as defined in
the Credit Agreement) with respect to the Operators and Health Care
Facilities (as each is defined in the Credit Agreement) set forth
on Schedule I-A hereto and (y) including, without limitation, (i)
all of Borrower's right, title and interest in and to each of the
agreements listed on Schedule II-A and each other agreement
executed by any of the Operators or any guarantor thereof in
respect of the Health Care Facilities set forth on Schedule I-A in
favor of the Borrower or to which Borrower is now or may hereafter
become a party, in each case as such agreements may be amended or
otherwise modified from time to time (collectively, the "Operator
Documents"), (ii) all rights of Borrower to receive moneys due and
to become due under or pursuant to the Operator Documents, (iii)
all rights of Borrower to receive proceeds of any insurance,
indemnity, warranty or guaranty with respect to the Operator
Documents, (iv) claims of Borrower for damages arising out of or
for breach of or default under the Operator Documents and (v) the
right of Borrower to terminate the Operator Documents, to perform
thereunder and to compel performance and otherwise exercise all
remedies thereunder; and (b) all proceeds of any and all of the
foregoing Collateral (including, without limitation, proceeds that
constitute property of the types described in clause (a) of this
Section 1 and, to the extent not otherwise included, all (x)
payments under insurance (whether or not the Agent is the loss
payee thereof), or any indemnity, warranty or guaranty, payable by
reason of loss or damage to or otherwise with respect to any of the
foregoing Collateral and (y) cash.
2. Obligations. This Amendment secures the complete and
timely payment of all principal and interest on any Loans made
under the Credit Agreement (including, without limitation, all
amounts which would become due but for the operation of the
automatic stay under Section 362(a) of the United States Bankruptcy
Code, 11 USC Section 362(a), and the operation of Sections 502(b) and
506(b) of the United States Bankruptcy Code, 11 USC Section 502(b) and
Section 506(b)), all liabilities under any hedge agreement, swap agreement
or similar agreement between the Borrower and any Bank, all
liability of the Borrower under Article VII and Article IX of the
Credit Agreement, and all fees and other liabilities, payable to
the Banks or the Agent or any thereof by the Borrower pursuant to
this Agreement, the Credit Agreement, the Collateral Documents or
any Related Writing (all such obligations secured herein referred
to as the "Obligations").
3. Amendment to Schedule I and Schedule II of Security
Agreement. Schedules I and II to the Security Agreement (as the
same may have been previously amended or restated or supplemented)
to add the items set forth on Schedule I-A and II-A hereto.
4. Representations and Warranties. Borrower represents and
warrants to the Agent that each of the representations and
warranties set forth in Section 3 of the Security Agreement are
true and correct. Borrower further represents and warrants that
this Amendment is made in accordance with the terms and limitations
of the Security Agreement and the Credit Agreement (including,
without limitation, Section 2.09 thereof).
5. Delivery of Instruments; Further Assurances. Borrower
shall deliver or cause to be delivered to the Agent for the benefit
of the Banks originals of any of the Operator Documents
constituting instruments (as defined in Article 9 of the UCC).
Borrower shall execute or cause to be executed such additional
instruments and shall do or cause to be done such further acts, as
the Agent may reasonably request, in order to permit the Agent to
perfect, protect, preserve and maintain the security interest
granted to the Agent by this Agreement, including, but not limited
to (i) general or specific assignments of such Operator Documents
as the Agent may designated, (ii) UCC-1 financing statements (or
UCC-3 amendments to previously filed UCC-1 financing statements)
naming Borrower as debtor and the Agent as Secured Party for the
benefit of the Banks with respect to the collateral identified on
Schedule II-A and (iii) UCC-3 assignments of any financing
statements filed in favor of Borrower in respect of any of the
Operator Documents or the obligations to the Borrower secured
thereby.
6. Governing Law. This Amendment and the respective rights
and obligations of the parties hereto shall be governed by and
construed in accordance with the internal laws of the State of Ohio
(without giving effect to the conflict of laws rules thereof),
except to the extent that the perfection and enforcement of the
lien and security interest granted hereunder must be subject to the
laws governing the Operator Documents.
7. Ratification of Security Agreement. Borrower hereby
ratifies and affirms the provisions of the Security Agreement, as
amended hereby.
IN WITNESS WHEREOF, Borrower has caused this Agreement to
be executed by its officers or agents thereunto duly authorized, as
of the date first above written.
HEALTH CARE REIT, INC., a
Delaware corporation
By:_______________________________
Name:_____________________________
Title:____________________________
<PAGE>
Schedule I-A
to
Amendment No. __ to
Security Agreement (General Intangibles)
(dated _________, 199_)
Health Care Facilities and the Operators related thereto:
Operator Health Care Facility
<PAGE>
Schedule II-A
to
Amendment No. __ to
Security Agreement (General Intangibles)
(dated _________, 1994)
Operator Documents:
[Each of the agreements executed by the following Operator in
respect of the following Health Care Facility (or any guarantor of
such Operator) in favor of Borrower, including without limitation,
the following:
1. Note
2. Loan Agreement
3. Mortgage
4. Guaranty ...]
[Each of the agreements executed by the following Operator in
respect of the following Health Care Facility (or any guarantor of
such Operator) in favor of Borrower, including without limitation,
the following:
1. Lease Agreement
2. Guaranty ...]
EXHIBIT M-1
AMENDED AND RESTATED CREDIT AGGREGATING $150,000,000
CERTAIN BANKS AND NATIONAL CITY BANK, AS AGENT
HEALTH CARE REIT, INC.
DATED AS OF SEPTEMBER, 1994
CERTIFICATE OF NO DEFAULT
I hereby certify that as of the date hereof, there exists no
Default under the terms of the Credit Agreement.
HEALTH CARE REIT, INC.
Dated: _________________ By: _____________________________
Robert J. Pruger
Chief Financial Officer
<PAGE>
SECTION 5.04 COVENANTS
CONSTRUCTION FINANCING
Section 5.04(o)(i) (Pages __________ of the Credit Agreement)
(Date)
---------------------------
Loan Amount Interest Fees &
Description Advanced Receivable Other Total
- - - ----------- ----------- ---------- ------- -----
Construction loan limitation, greater of:
(1) Specified amount $35,000,000
===========
(2) 10% of total assets $==========
NOTE: This covenant always pertains to the three most recent
fiscal quarters.
CREDIT ENHANCEMENTS
Section 5.04(o)(ii) (Page _______ of the Credit Agreement)
AMOUNT
DESCRIPTION (DATE)
- - - ----------------------------------------------- ------------
TOTAL $----------
Credit Enhancement limitation, 20% of total net worth $----------
NOTE: This covenant always pertains to the three most recent
fiscal quarters.
PSYCHIATRIC HOSPITALS
Section 5.04(o)(iii) (Page ___ of the Credit Agreement)
Construction Mortgage Working
Loans Loans Capital Loans TOTAL
------------ -------- ------------- ---------
Totals $----------- $------- $------------ $--------
Psychiatric Hospital limitation, 20% of Balance Sheet Assets
NOTE: This covenant always pertains to the three most recent
fiscal quarters.
Section 5.04(p)(i)(ii)(iii) (Page _____ of the Credit Agreement)
The Borrower is in compliance with Section 5.04(p) and
commitments detailed on the Quarterly Liability Schedule (i.e.
Exhibit M-4) do not violate subsection p(i)(ii)(iii) requirements.
Section 5.04(p)(iv) and (v) (Page ___ of the Credit Agreement)
The Borrower shall not, and shall not suffer any subsidiary
to, make or commit to make ... any investment in any REMIC if,
after giving effect thereto, the aggregate amount of all
outstanding investments in REMICs together with all outstanding
investments in Permitted Investments (other than REMICs and other
than Permitted Investments described in Internal Revenue Code
Section 856(c)(5)(A) which are not REMICs) would exceed twenty-five
percent (25% of the Borrower's Balance Sheet Assets as at the end
of the immediately preceding Fiscal Quarter; provided, however,
that any such investment shall be subject to the limitations set
forth in Sections 5.04(a), 5.04(c), 5.04(o) and the other clauses
of this Section 5.04(p).
Actual:
Remics $---------- -------%
Permitted Investments (list)
$---------
----------
---------- $--------- -------%
Total ---------- $========= -------%
Required: Cannot exceed 25% of Balance
Sheet Assets; 25% Balance
Sheet Assets $=========
Section 5.04(v) (Page _____ of the Credit Agreement)
Actual
Permitted Investments (List)
$---------
$========= -------%
Required: Cannot exceed 10% of Balance
Sheet Assets 10% Balance
Sheet Assets $=========
<PAGE>
Portfolio Diversification, Section 5.04(i)and (ii) (Page ______ of
the Credit Agreement
17.5% 17.5% of Gross
of Balance Consolidated
Sheet Assets, Revenue, Most
Borrrower/ Most Recent Most Recent
Operator/Lessee Exposure Fiscal Quarter Fiscal Quarter
- - - --------------- -------- -------------- --------------
Psychiatric Hospitals - Borrowing Base
Section 5.04(r) (Page _____ of the Credit Agreement)
Date
-------------------
Loans to Psychiatric Hospitals (Borrowing Base Assets)
Total $-----------
Total Borrowing Base Assets $-----------
Percentage of Borrowing Base Assets
Comprised of Psychiatric Loan = ------------%
Psychiatric Hospital Limitation, 20%
Section 5.05 (Page ______ of the Credit Agreement)
Consolidated Tangible Net Worth
Required:
minimum tangible net worth $180,000,000
plus:
proceeds equity issuance $---------
80% x .80
$--------- $-----------
Required Minimum $===========
Actual $===========
<PAGE>
Consolidated Interest Coverage
Consolidated Net Income $----------
plus: interest expense
taxes
depreciation and amortization $----------
Interest expense
Ratio (Actual)
Required: must be at least 2.0 to 1.0
Consolidated Leverage Ratio
Borrowings under credit agreement $----------
Borrowings under lines of credit
Senior notes
Other obligations $----------
$==========
Consolidated Net Worth $==========
Ratio (Actual) -----------
Required: must be less than or equal to 1.30 to 1.0
<PAGE>
Consolidated Contingent Leverage Ratio
Borrowings under Credit Agreement $----------
Borrowings under lines of credit
Senior Notes
Other obligations
Contingent Liabilities -----------
$==========
Consolidated Net Worth $==========
Ratio (Actual) -----------
Required: must be less than or equal to 1.55 to 1.0
Borrowing Base Debt Coverage Ratio:
Actual
Aggregate quarterly net income
of each Operator $----------
plus: Aggregate depreciation and amortization
Aggregate taxes
Aggregate fees, interest, principal
and lease payments -----------
Weighted Average of Total Cash
available for debt service* $==========1
Weighted Average of Aggregate fees,
interest, principal and lease payments* $==========2
Debt Coverage Ratio $==========
Required: cannot be less than 1.25 to 1.0.
* Attached Schedule sets forth Computations for Weighted Average
Calculations
1 - Total from Column (A) on Attached Schedule
2 - Total from Column (B) on Attached Schedule
<PAGE>
Borrowing Base Debt Coverage Ratio
(Computations for Determining Weighed Average)
(1) (A) (2) (B)
Operator's
Product of Aggregate Product
(1) X Fees of (2) X
Name of Operator's Operator's Operator's Interest, Operator's
Operator Weighted Total Cash Weighted Principle Weighted
and Address Value Available for Value & Lease Value
of Asset Percentage Debt Service Percentage Payments Percentage
TOTALS (A)---------2 (B)-------3
- - - -----------------
1 - Operator Weighted Value Percentage is determined by
dividing the Asset Value of the Asset by the aggregate of all Asset
Values of all Borrowing Base Assets.
2 - Total to be entered on appropriate line on prior page.
3 - Total to be inserted on appropriate line on prior page.
EXHIBIT M-2
Form of Borrowing Base Report
HEALTH CARE REIT, INC.
Date: September 8, 1994
ELIGIBLE OPERATOR LEASES
- - - ------------------------------------------------------------------
(1)
Property Location Date Facility Lease Value
Operator Name Added Type (Option Price)
- - - ----------------- ----- -------- --------------
- - - ------------------------------------------------------------------
Last Asset Value Operator
Appraisal Appraised (Lessor of (1) Payment
Date Value and (2)) Coverage
- - - --------- --------- -------------- ---------
Certified By:
-----------------------------
-----------------------------
EXHIBIT M-3
HEALTH CARE REIT, INC.
AGING SCHEDULE
As of _______________, 19___
PERIOD PAYMENTS TOTAL
LEASES
("Operator Leases")*
MORTGAGES
("Operator Loans")*
*As Defined in Credit Agreement.
EXHIBIT M-4
HEALTH CARE REIT, INC. AND SUBSIDIARY
QUARTERLY LIABILITY SCHEDULE
As of ______________, 19___
Debt to Worth
Liabilities per financial statements $----------- --- to 1
Contingent Liabilities
$---------- $---------- ___ to 1
$========== ___ to 1
Shareholders' Equity $==========
(A) Date letter of credit expires
EXHIBIT N
FORM OF ASSIGNMENT AGREEMENT
This Assignment Agreement (this "Assignment Agreement")
between __________________________________________________________
(the "Assignor") and ________________________________________ (the
"Assignee") is dated as of _____________, 1994. The parties hereto
agree as follows:
1. PRELIMINARY STATEMENT. The Assignor is a party to a
Credit Agreement, dated as of ____________, 1994 (which, as it may
be amended, modified, renewed or extended from time to time, is
herein called the "Credit Agreement"), among Health Care REIT,
Inc., (the "Borrower"), certain banks listed on the signature pages
thereof (collectively, the "Banks"), and National City Bank, as
agent for the Banks (the "Agent"). Capitalized terms used herein
and not otherwise defined herein shall have the meanings attributed
to them in the Credit Agreement. The Assignor desires to assign to
the Assignee, and the Assignee desires to assume from the Assignor,
an undivided interest (the "Purchased Percentage") in the Revolving
Credit Commitment of the Assignor such that after giving effect to
the assignment and assumption hereinafter provided, the Revolving
Credit Commitment of the Assignee shall equal
________________________ Dollars ($___________) [not less than
$10,000,000] and its percentage of the aggregate amount of the
Revolving Credit Commitments shall equal ________________________
percent (____%).
2. ASSIGNMENT. For and in consideration of the assumption of
obligations by the Assignee set forth in Section 3 hereof and the
other consideration set forth herein, and effective as of the
Effective Date (as hereinafter defined), the Assignor does hereby
sell, assign, transfer and convey all of its right, title and
interest in and to the Purchased Percentage of (i) the Revolving
Credit Commitment of the Assignor (as in effect on the Effective
Date), (ii) any Revolving Credit Loan made by the Assignor which is
outstanding on the Effective Date, (iii) any Note delivered to the
Assignor pursuant to the Credit Agreement, and (iv) the Credit
Agreement and the other Related Writings. Pursuant to Section
8.01(d) of the Credit Agreement, on and after the Effective Date
the Assignee shall have the same rights, benefits and obligations
as the Assignor had under the Credit Agreement and the Related
Writings with respect to the Purchased Percentage of the Related
Writings, all determined as if the Assignee were a "Bank" under the
Credit Agreement with ____________________ Dollars
($_____________) [not less than $10,000,000] equaling _____________
percent (_____%) of the aggregate amount of the Revolving Credit
Commitments. The Effective Date (the "Effective Date") shall be
two Business Days (or such shorter period agreed to by the Agent)
after a Notice of Assignment substantially in the form of
Attachment I hereto and any consents substantially in the form of
Attachment II hereto required to be delivered to the Agent,
together with a fee of $2,500, in accordance with Section 8.01(a)
and (b) of the Credit Agreement have been delivered to the Agent;
provided, however, that, in the event that the Borrower shall
appropriately deliver a Credit Request or a Rate
Conversion/Continuation Request prior to the time at which all of
conditions to the effectiveness of this Assignment shall have been
met, the Effective Date shall be the Business Day immediately
following the day upon w
<TABLE> <S> <C>
<ARTICLE> CT
<CIK> 0000766704
<NAME> HEALTH CARE REIT, INC.
<S> <C>
<PERIOD-TYPE> QTR-3
<FISCAL-YEAR-END> DEC-31-1994
<PERIOD-END> SEP-30-1994
<TOTAL-ASSETS> 306,759,454
<COMMON> 11,549,064
0
0
<OTHER-SE> 176,827,997
<TOTAL-LIABILITY-AND-EQUITY> 306,759,454
<TOTAL-REVENUES> 31,690,120
<INCOME-TAX> 0
<INCOME-CONTINUING> 19,110,274
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 19,110,274
<EPS-PRIMARY> 1.66
<EPS-DILUTED> 1.66
</TABLE>
F O R I M M E D I A T E R E L E A S E
PRESS RELEASE
July 20, 1994
For more information contact:
Erin Ibele (419) 247-2800
Robert Pruger (419) 247-2800
HEALTH CARE REIT, INC. DECLARES DIVIDEND
AND ANNOUNCES SECOND QUARTER RESULTS
AND AN INCREASE IN CREDIT RATING
Toledo, Ohio, July 20, 1994....The Directors of Health
Care REIT, Inc. (NYSE/HCN) voted to pay a quarterly dividend at the
rate of $.505 per share, an increase of $.005 per share from the
previous dividend. The dividend will be payable August 19, 1994 to
shareholders of record on August 5, 1994. This will be the REIT's
93rd consecutive dividend distribution.
Net cash provided from operating activities for the six
months ended June 30, 1994 was $15,807,478 ($1.38 per share)
compared with $10,988,850 ($1.25 per share) for the six months
ended June 30, 1993.
For the quarter ended June 30, 1994, net income per share
of $.68 was up $.14 or 25.9% from the second quarter of 1993. The
increase is principally the result of gains on the exercise of
options in the second quarter of 1994. For the first half of 1994,
net income per share was $1.11 compared to $1.13 for the first half
of 1993.
Gross income for the three months ended June 30, 1994 was
up 42.3% from the second quarter of 1993. Total assets of $306.8
million at June 30, 1994 reflect a 10.4% increase from a year ago.
The following chart presents the information highlighted
above.
<TABLE>
Three Months Ended
June 30, (Unaudited)
------------------------------
1994 1993
------------ ------------
<C> <C>
<S>
Gross income $ 12,730,715 $ 8,949,136
Net income $ 7,799,857 $ 4,789,912
Funds from operations $ 9,515,056 $ 5,424,459
Net income per share $ .68 $ .54
Funds from operations per share $ .83 $ .62
Average number of shares outstanding 11,504,848 8,811,802
Six Months Ended
June 30, (Unaudited)
------------------------------
1994 1993
------------ ------------
Gross income $ 21,171,954 $ 17,552,005
Net income $ 12,784,107 $ 9,930,521
Funds from operations $ 15,807,478 $ 10,988,850
Net income per share $ 1.11 $ 1.13
Funds from operations per share $ 1.38 $ 1.25
Average number of shares outstanding 11,486,049 8,791,582
Total assets as of June 30 $306,843,312 $278,032,160
</TABLE>
The Company is pleased to announce that it recently
received a notice of an increase in its credit rating to BBB from
Duff & Phelps Credit Rating Co.
Health Care REIT, Inc. is a real estate investment trust
which invests in health care facilities, primarily nursing homes.
The Company also invests in assisted living and retirement
facilities, rehabilitation centers, primary care facilities and
psychiatric hospitals.
F O R I M M E D I A T E R E L E A S E
PRESS RELEASE
July 21, 1994
For more information contact:
Erin Ibele (419) 247-2800
Robert Pruger (419) 247-2800
HEALTH CARE REIT, INC. ADOPTS A RIGHTS PLAN
Toledo, Ohio, July 21, 1994....Health Care REIT, Inc.
today announced that its Board of Directors adopted a Preferred
Share Purchase Rights Plan and declared a dividend distribution to
be made to stockholders of record on August 5, 1994, of one
Preferred Share Purchase Right on each outstanding share of the
Company's common stock. Each Right will entitle stockholders to
buy one one-thousandth of a share of a new series of junior
participating preferred stock for an exercise price of $48.00.
The Rights will be exercisable only if a person or group
acquires or announces a tender offer for 15% or more of the
Company's common stock. The Company may exchange the Rights
(except those held by an acquirer, which would be void) for the
Company's common stock on a one-for-one basis at any time after a
person or group has acquired 15% or more of the outstanding common
stock. The Company will be entitled to redeem the Rights at $.01
per Right at any time before public disclosure that a 15% position
has been acquired. The Rights will expire on August 5, 2004,
unless previously redeemed, exchanged or exercised. The
distribution of the Rights is not a taxable event to stockholders.
Additional details of the Rights distribution are
available from the Company upon request.
Health Care REIT, Inc. is a real estate investment trust
which invests in health care facilities, primarily nursing homes.
The Company also invests in assisted living and retirement
facilities, rehabilitation centers, primary care facilities and
behavioral care facilities.
F O R I M M E D I A T E R E L E A S E
PRESS RELEASE
July 21, 1994
For more information contact:
Erin Ibele (419) 247-2800
Robert Pruger (419) 247-2800
HEALTH CARE REIT, INC. ANNOUNCES
$150 MILLION REVOLVING LINE OF CREDIT
Toledo, Ohio, September 21, 1994....Health Care REIT,
Inc. (NYSE/HCN) announced the successful closing of a $150 million
revolving line of credit with a consortium of eight banks. The new
line amends and restates a prior $100 million agreement. The Agent
for the bank group is National City Bank, Cleveland, Ohio and the
participant banks are Bank One, N.A.; Comerica Bank; The Daiwa
Bank, Limited; Harris Trust and Saving Bank; Manufacturers and
Traders Trust Co.; National City Bank; Society National Bank; and
NBD Bank, N.A. The increase in the line will enable the Company to
fund additional health care facility investments.
Health Care REIT, Inc. is a real estate investment trust
which invests in health care facilities, primarily nursing homes.
The Company also invests in assisted living and retirement
facilities, rehabilitation centers, primary care facilities and
behavioral care facilities.
