EXHIBIT 10.35
ASSUMPTION AGREEMENT
This ASSUMPTION AGREEMENT ("ASSUMPTION AGREEMENT") is made and entered
into as of September 30, 2005, by FIT CYPRESS VILLAGE LLC (F/K/A FIT NBA
CYPRESS VILLAGE LLC), FIT FOXWOOD SPRINGS LLC (F/K/A FIT NBA FOXWOOD SPRINGS
LLC), FIT PATRIOT HEIGHTS LP (F/K/A FIT NBA PATRIOT HEIGHTS LP), FIT XXXXXX LLC
(F/K/A FIT NBA XXXXXX LLC), FIT XXXXX RUN LP (F/K/A FIT NBA XXXXX RUN LP), and
FIT SKYLINE LLC (F/K/A FIT NBA SKYLINE LLC), each a Delaware entity
(collectively, "BORROWERS"), FORTRESS INVESTMENT TRUST II, a Delaware trust
("PRINCIPAL"), BROOKDALE SENIOR LIVING INC., a Delaware corporation ("NEW
PRINCIPAL"), and FORTRESS CCRC ACQUISITION LLC (F/K/A FORTRESS NBA ACQUISITION,
LLC), a Delaware limited liability company ("OWNER"), FIT PATRIOT HEIGHTS GP,
INC. (F/K/A FIT NBA PATRIOT HEIGHTS GP, INC.), a Delaware corporation ("PATRIOT
HEIGHTS GP"), FIT XXXXX RUN GP, INC. (F/K/A FIT NBA XXXXX RUN GP, INC.), a
Delaware corporation ("XXXXX RUN GP"), BLC-CYPRESS VILLAGE, LLC, a Delaware
limited liability company, BLC-FOXWOOD SPRINGS, LLC, a Delaware limited
liability company, BLC-XXXXXX, LLC, a Delaware limited liability company,
BLC-VILLAGE AT SKYLINE, LLC, a Delaware limited liability company, BLC-PATRIOT
HEIGHTS, L.P., a Delaware limited partnership, BLC-XXXXX RUN, L.P., a Delaware
limited partnership (collectively, "OPERATORS"), and GENERAL ELECTRIC CAPITAL
CORPORATION, a Delaware corporation (in its individual capacity, "GECC" and as
agent for Lenders, "AGENT"), as Agent and a Lender, and XXXXXXX XXXXX CAPITAL, a
division of Xxxxxxx Xxxxx Business Financial Services, Inc., as a Lender.
RECITALS:
A. Borrowers, Agent and Lenders are parties to that certain Loan Agreement
dated April 6 2005 (as amended from time to time, the "LOAN AGREEMENT"),
pursuant to which Lenders have made a loan to Borrowers in the original
principal amount of $143,000,000 (the "LOAN"). The Loan Agreement and the other
documents evidencing or securing the Loan, as set forth on Schedule I attached
hereto are collectively referred to herein as the "LOAN DOCUMENTS."
B. The one hundred percent (100%) indirect owner of each Borrower is
Owner.
C. BSL CCRC Merger Inc., a wholly owned subsidiary of New Principal,
desires to merge into Owner (the "NEWCO MERGER"), with Owner as the surviving
entity.
D. After the Newco Merger, New Principal will own one hundred percent
(100%) of the direct ownership interest in Owner.
E. Concurrently with the Newco Merger, BSL Brookdale Merger Inc.,
("BROOKDALE OWNER"), a wholly owned subsidiary of New Principal, intends to
merge into Brookdale Living Communities, Inc. ("BROOKDALE OWNER"), with
Brookdale Owner as the
surviving entity. Brookdale Living Communities, Inc. owns one hundred percent
(100%) of the direct ownership interests in each Operator. Immediately following
such Brookdale Merger, Brookdale Owner will continue to be the one hundred
percent (100%) indirect owner of each Operator.
F. The Newco Merger and the Brookdale Merger are sometimes collectively
referred to herein collectively as the "MERGERS."
G. Borrowers, Principal, New Principal, Owner, Patriot Heights GP, Xxxxx
Run GP, Brookdale Owner and Operators are sometimes collectively referred to
herein as "LOAN PARTIES."
Therefore, the parties agree as follows:
1. DEFINITIONS. Except as defined herein, the capitalized terms used
herein shall have the meanings ascribed to such terms in the Loan Agreement. For
purposes hereof, the following terms shall have the following meanings:
"EFFECTIVE DATE" means the date all of the Conditions Precedent set forth
in Section 3 of this Assumption Agreement have been satisfied.
2. CONSENT. On the terms and conditions set forth herein, Lender hereby
consents to the Mergers.
3. CONDITIONS PRECEDENT. The following shall be conditions precedent to
the effectiveness of Lender's consent to the Mergers:
(a) No Event of Default shall have occurred and be continuing under the
Loan Documents;
(b) Agent shall have received payment of $12,900.00, representing Lender's
and Agent's costs and expenses incurred in connection with the matters set forth
herein;
(c) Agent shall have approved the form and substance of the documents
evidencing the Mergers;
(d) Agent shall have received and approved those certain organizational
and charter documents (the "ORGANIZATIONAL AND CHARTER DOCUMENTS") set forth on
Schedule II attached hereto, and the Loan Parties hereby certify that each of
such Organizational and Charter Documents are true, correct and complete copies;
(e) Agent shall have received satisfactory opinions of counsel regarding
the Mergers, the organization and existence of New Principal, the due execution,
delivery and enforceability of this Assumption Agreement and the documents
executed and delivered in connection herewith and such other matters as Agent
may require; and
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(f) Neither Agent nor any Lender has commenced and is then pursuing any
rights or remedies under or with respect to Environmental Indemnity, the
Agreement of Principal, the Post-Closing Agreement or the Limited Guaranty, and
no monetary default or material non-monetary default is continuing under any of
the other Loan Documents.
4. ACKNOWLEDGMENTS. Loan Parties each acknowledge and agree as follows (in
each case as of the date hereof): (a) the outstanding principal balance of the
Loan is $105,756,000.00, (b) each of the Loan Documents is in full force and
effect and all liens and security interests of Lender against the Projects and
all other assets of Borrowers shall continue to encumber such assets, (c) there
are no setoffs or defenses to the Indebtedness or any Loan Party's obligations
under the Loan Documents and (d) no Loan Party has any claims against any Lender
or Agent arising out of or in connection with the Loan, all such claims being
hereby waived and released.
5. REPRESENTATIONS AND WARRANTIES. Each Loan Party represents and warrants
that except as set forth on Schedule III and after giving effect to the Mergers
and the amendments set forth in Section 7 of this Assumption Agreement, each of
the representations and warranties set forth in the Loan Documents is true and
correct as of the date hereof.
6. ASSUMPTION.
(a) Concurrently with the consummation of the Mergers, New Principal shall
be deemed to have assumed and does hereby agree to assume and perform all
obligations of Principal under the Loan Documents to which Principal is a party
and be bound by the terms of each of the Loan Documents to which Principal is a
party as if New Principal were an original party thereto.
(b) The obligations assumed by New Principal include, without limitation,
obligations of Principal which accrued prior to the Effective Date whether know
or unknown, contingent or liquidated. Neither Agent nor any Lender makes any
representation or warranty as to the nature or amount of any such obligations
being assumed, and new Principal is relying entirely on its own independent
investigations and due diligence in entering into this Assumption Agreement.
(c) From and after the Effective Date and in consideration of the
execution of this Assumption Agreement, Principal will be released from all of
its obligations under the Loan Documents.
7. AMENDMENTS.
(a) As of the Effective Date, all references to "Principal" in the Loan
Agreement and the other Loan Documents shall be deemed to refer to New
Principal.
(b) As of the Effective Date, the organizational chart attached as Exhibit
G to the Loan Agreement is hereby replaced with the organizational chart
attached hereto as Schedule IV.
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(c) As of the Effective Date, Section 5.2 of the Limited Guaranty is
hereby amended by deleting the number "One Hundred Fifty Million Dollars
($150,000,000)" and replacing it with "One Hundred Twenty-Five Million Dollars
($125,000,000)."
(d) As of the Effective Date, the phrase "if all of the Assumption
Conditions or the conditions to a Principal Release (as defined in the Loan
Agreement) have in each case, been satisfied in full, then this Guaranty shall
automatically terminate without further acknowledgment or agreement by Lender or
Agent, and Guarantor shall thereafter have no further liability with respect to
this Agreement" in Section 9 of the Limited Guaranty is hereby deleted in its
entirety.
(e) As of the Effective Date, Section 28 of the Agreement of Principal is
hereby amended by deleting the number "One Hundred Fifty Million Dollars
($150,000,000)" and replacing it with "One Hundred Twenty-Five Million Dollars
($125,000,000)."
(f) As of the Effective Date, Section 29 of the Agreement of Principal is
hereby deleted in its entirety.
(g) As of the Effective Date, Section 35 of the Environmental Indemnity is
hereby amended by deleting the number "One Hundred Fifty Million Dollars
($150,000,000)" and replacing it with "One Hundred Twenty-Five Million Dollars
($125,000,000)."
(h) As of the Effective Date, Section 36 of the Environmental Indemnity is
hereby deleted in its entirety.
(i) As of the Effective Date, Section 18 of the Right of First Refusal is
hereby deleted in its entirety.
8. LOAN DOCUMENTS. The Loan Documents are amended to provide that all
references to a "LOAN DOCUMENT" or to the "LOAN DOCUMENTS" shall mean and
include such document(s) as amended by this Assumption Agreement. This
Assumption Agreement constitutes a "Loan Document."
9. CONTINUING EFFECT. Except as otherwise expressly provided herein, the
Loan Documents shall remain unmodified and in full force and effect.
10. NO NOVATION. The provisions of this Assumption Agreement shall in no
way act as a novation of the Indebtedness or a release, relinquishment,
alteration (except to the extent that New Principal will replace Principal under
the Loan Documents), or reissue of the liens, security interest, and rights
securing payment of the Loan, including, without limitation, the liens created
by the Loan Documents.
11. FURTHER ASSURANCES. Loan Parties will, at their expense, do, execute,
acknowledge, deliver or cause to be done, executed, acknowledged and delivered
all such
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further acts, instruments and assurances required by Agent to effectuate the
purposes of this Assumption Agreement.
12. GOVERNING LAW. This Assumption Agreement has been delivered in the
State of Illinois and shall be governed and interpreted under the laws of the
State of Illinois.
13. AUTHORITY. Each of the parties represent and warrant that such party
has full power and authority to consummate this Assumption Agreement, and has
full power and authority to incur and perform the obligations provided for under
this Assumption Agreement and, as applicable, the Loan Documents, all of which
have been duly authorized by all proper and necessary corporate action. No
consent or approval of shareholders or of any public authority or regulatory
body which has not been obtained is required as a condition to the validity or
enforceability of this Assumption Agreement.
14. ENTIRE AGREEMENT. This Assumption Agreement contains the entire
agreement between and among the parties hereto, and no promise, inducement,
agreement, statement or consideration not herein expressed has been made between
or among the parties with respect to the assumption of the Loan.
15. COUNTERPARTS. This Assumption Agreement may be executed in two or more
counterparts, each of which when fully executed shall be an original, and all of
said counterparts taken together shall be deemed to constitute one and the same
agreement.
16. TERMINATION. This Assumption Agreement will terminate and be of no
further force or effect if the Effective Date does not occur on or before
October 31, 2005.
17. EXPENSES. Borrowers agree to pay all Expenses incurred by Lender in
connection with the Assumption Agreement, including legal fees, search fees and
recording charges.
[THE NEXT PAGE IS THE SIGNATURE PAGE]
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IN WITNESS WHEREOF, the parties have executed this Assumption Agreement as
of the date first above written.
BORROWERS:
FIT CYPRESS VILLAGE LLC (F/K/A FIT
NBA CYPRESS VILLAGE LLC), a Delaware
limited liability company
By: /s/ Xxxxxxx X. Xxxxxxxxx
___________________________________
Name: Xxxxxxx X. Xxxxxxxxx
_________________________________
Title: CFO
________________________________
FIT FOXWOOD SPRINGS LLC (F/K/A FIT
NBA FOXWOOD SPRINGS LLC), a Delaware
limited liability company
By: /s/ Xxxxxxx X. Xxxxxxxxx
___________________________________
Name: Xxxxxxx X. Xxxxxxxxx
_________________________________
Title: CFO
________________________________
FIT PATRIOT HEIGHTS LP (F/K/A FIT NBA
PATRIOT HEIGHTS LP), a Delaware limited
partnership
By: FIT Patriot Heights GP, Inc. (f/k/a
FIT NBA Patriot Heights GP Inc.), a
Delaware corporation, its general
partner
By: /s/ Xxxxxxx X. Xxxxxxxxx
_______________________________
Name: Xxxxxxx X. Xxxxxxxxx
_____________________________
Title: CFO
____________________________
Signature Page to Assumption Agreement
FIT XXXXXX LLC (F/K/A FIT NBA XXXXXX
LLC), a Delaware limited liability
company
By: /s/ Xxxxxxx X. Xxxxxxxxx
___________________________________
Name: Xxxxxxx X. Xxxxxxxxx
_________________________________
Title: CFO
________________________________
FIT XXXXX RUN LP (F/K/A FIT NBA XXXXX
RUN LP), a Delaware limited partnership
By: FIT Xxxxx Run GP, Inc. (f/k/a FIT
NBA Xxxxx Run GP Inc.), a Delaware
corporation, its general partner
By: /s/ Xxxxxxx X. Xxxxxxxxx
_______________________________
Name: Xxxxxxx X. Xxxxxxxxx
_____________________________
Title: CFO
` ____________________________
FIT SKYLINE LLC (F/K/A FIT NBA SKYLINE
LLC), a Delaware limited liability
company
By: /s/ Xxxxxxx X. Xxxxxxxxx
___________________________________
Name: Xxxxxxx X. Xxxxxxxxx
_________________________________
Title: CFO
________________________________
Signature Page to Assumption Agreement
PRINCIPAL:
FORTRESS INVESTMENT TRUST II, a
Delaware trust
By: /s/ Xxxxxxx X. Xxxxxxxxx
___________________________________
Name: Xxxxxxx X. Xxxxxxxxx
_________________________________
Title: CFO
________________________________
NEW PRINCIPAL:
BROOKDALE SENIOR LIVING INC., a
Delaware corporation
By: /s/ R. Xxxxxxx Xxxxx
___________________________________
Name:
_________________________________
Title:
________________________________
OWNER:
FORTRESS CCCRC ACQUISITION LLC
(F/K/A FORTRESS NBA ACQUISITION, LLC),
a Delaware limited liability company
By: /s/ Xxxxxxx X. Xxxxxxxxx
___________________________________
Name: Xxxxxxx X. Xxxxxxxxx
_________________________________
Title: CFO
________________________________
Signature Page to Assumption Agreement
PATRIOT HEIGHTS GP:
FIT PATRIOT HEIGHTS GP, INC. (F/K/A FIT
NBA PATRIOT HEIGHTS GP, INC.), a
Delaware corporation
By: /s/ Xxxxxxx X. Xxxxxxxxx
___________________________________
Name: Xxxxxxx X. Xxxxxxxxx
_________________________________
Title: CFO
________________________________
XXXXX RUN GP:
FIT XXXXX RUN GP, INC. (F/K/A FIT NBA
XXXXX RUN GP, INC.), a Delaware
corporation
By: /s/ Xxxxxxx X. Xxxxxxxxx
___________________________________
Name: Xxxxxxx X. Xxxxxxxxx
_________________________________
Title: CFO
________________________________
Signature Page to Assumption Agreement
OPERATORS:
BLC-CYPRESS VILLAGE, LLC,
a Delaware limited liability company
By: /s/ R. Xxxxxxx Xxxxx
___________________________________
Name:
_________________________________
Title:
________________________________
BLC-FOXWOOD SPRINGS, LLC,
a Delaware limited liability company
By: /s/ R. Xxxxxxx Xxxxx
___________________________________
Name:
_________________________________
Title:
________________________________
BLC-PATRIOT HEIGHTS, L.P., a Delaware
limited partnership
By: BLC-PATRIOT HEIGHTS, LLC, a
Delaware limited liability company,
its sole General Partner
By: /s/ R. Xxxxxxx Xxxxx
_______________________________
Name:
_____________________________
Title:
____________________________
Signature Page to Assumption Agreement
BLC-XXXXXX, LLC, a Delaware limited
liability company
By: /s/ R. Xxxxxxx Xxxxx
___________________________________
Name: _________________________________
Title: ________________________________
BLC-XXXXX RUN, L.P., a Delaware limited
partnership
By: BLC-XXXXX RUN, LLC, a Delaware
limited liability company, its sole
General Partner
By: /s/ R. Xxxxxxx Xxxxx
_______________________________
Name: _____________________________
Title: ____________________________
BLC-VILLAGE AT SKYLINE, LLC,
a Delaware limited liability company
By: /s/ R. Xxxxxxx Xxxxx
___________________________________
Name: _________________________________
Title: ________________________________
Signature Page to Assumption Agreement
AGENT:
GENERAL ELECTRIC CAPITAL CORPORATION, a
Delaware corporation, as Agent
By: /s/ Xxxx Xxxxxxx
--------------------------
Name: Xxxx Xxxxxxx
Title: Authorized Signatory
LENDERS:
XXXXXXX XXXXX CAPITAL, a division of
Xxxxxxx Xxxxx Business Financial
Services Inc., a Delaware corporation
By: /s/ Xxxxx Xxxxxxxx
----------------------------
Name: Xxxxx Xxxxxxxx
Title: Vice President
GENERAL ELECTRIC CAPITAL CORPORATION,
a Delaware corporation
By: /s/ Xxxx Xxxxxxx
--------------------------
Name: Xxxx Xxxxxxx
Title: Authorized Signatory
Signature Page to Assumption Agreement
SCHEDULE I
LOAN DOCUMENTS
1. Agreement Regarding Pledged Accounts
2. Agreement of Principal
3. Assignment of Membership and Partnership Interest
4. Authorization to File UCC Financing Statements
5. Authorization to File UCCs (Pledgors)
6. Authorization to Wire Letter
7. Subordination of Lease (Colorado)
8. Subordination of Management Agreement (Colorado)
9. Assignment of Leases and Rents (Colorado)
10. Deed of Trust (Colorado)
11. Control Agreement (Government Receivables)
12. Environmental Indemnity Agreement
13. Exclusive Right of First Refusal
14. Subordination of Lease (Florida)
15. Subordination of Management Agreement (Florida)
16. Mortgage (Florida)
17. Subordination of Management Agreement (Indiana)
18. Mortgage (Indiana)
19. Intercreditor Agreement
20. Subordination of Management Agreement (Iowa)
21. Mortgage (Iowa)
22. Joinder to Business Associate Agreement
23. Limited Guaranty of Payment and Performance
24. Loan Agreement
25. Deed of Trust (Missouri)
26. Post-Closing Agreement
27. Promissory Note (MLC)
28. Promissory Note (GECC)
29. Subordination of Lease (Texas)
30. Subordination of Management Agreement (Texas)
31. Deed of Trust (Texas)
SCHEDULE II
ORGANIZATIONAL AND CHARTER DOCUMENTS
CHARTER DOCUMENTS: BROOKDALE SENIOR LIVING INC.
Articles of Incorporation (or equivalent) - recently certified by Secretary of
State of jurisdiction of organization
Bylaws (or equivalent) and all amendments
Good Standing Certificate (or equivalent) and Franchise Tax Certificate (if
applicable in that jurisdiction): State of Organization
Resolutions of the Directors(s) and/or Shareholder(s) (as applicable)
authorizing the merger transaction
CHARTER DOCUMENTS: FORTRESS CCRC ACQUISITION LLC)
Articles of Formation (or equivalent) - recently certified by Secretary of State
of jurisdiction of organization
Operating Agreement
GOOD STANDING CERTIFICATES
Fortress CCRC Acquisition LLC (fka Fortress NBA Acquisition LLC)
Fortress Investment Trust II
FIT Cypress Village LLC (fka FIT NBA Cypress Village LLC)
FIT Foxwood Springs (fka FIT NBA Foxwood Springs)
FIT Patriot Heights LP (fka FIT NBA Patriot Heights LP)
FIT Xxxxxx LLC (fka FIT NBA Xxxxxx LLC)
FIT Xxxxx Run LP (fka FIT NBA Xxxxx Run LP)
FIT Skyline LLC (fka FIT NBA Skyline LLC)
FIT Patriot Heights GP Inc. (fka as FIT NBA Patriot Heights GP Inc.)
FIT Xxxxx Run GP, Inc. (fka FIT NBA Xxxxx GP Inc.)
BLC-Cypress Village, LLC
BLC-Foxwood Springs, LLC
BLC-Xxxxxx, LLC
BLC-Village at Skyline, LLC
BLC-Patriot Heights, L.P.
BLC-Patriot Heights, LLC
BLC-Xxxxx Run, L.P.
BLC-Xxxxx Run, LLC
SCHEDULE III
REPRESENTATIONS AND WARRANTIES