LOAN NO. 07-0004017
GUARANTY
THIS GUARANTY dated as of the 21st day of August, 2002 (the "GUARANTY") is
made by the EMERITUS CORPORATION, a Washington corporation, with an address at
0000 Xxxxxxx Xxxxxx, Xxxxx 000, Xxxxxxx, Xxxxxxxxxx 00000 (referred to herein as
the "GUARANTOR"), for the benefit of XXXXXX HEALTHCARE FINANCE, INC., a Delaware
corporation ("LENDER").
RECITALS
A. FINANCIAL ACCOMMODATIONS. Lender and Emeritus Properties XIV, LLC,
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a Washington limited liability company ("BORROWER"), are concurrently herewith
entering into that certain Loan Agreement (the "LOAN AGREEMENT") of even date
herewith pursuant to which Lender shall extend financial accommodations to
Borrower.
B. INDUCEMENT. To induce Lender to extend to Borrower the financial
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accommodations set forth in the Loan Agreement, Guarantor is willing to execute
and deliver this Guaranty.
In consideration of the foregoing, and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged,
Guarantor hereby agrees as follows:
1. DEFINED TERMS
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All capitalized terms used herein and not otherwise defined shall have the
meanings assigned to such terms in the Loan Agreement.
2. THE GUARANTY
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2.1. GUARANTY OF OBLIGATIONS. Guarantor unconditionally and absolutely
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guarantees to Lender the full and prompt payment and performance when due,
whether at maturity or earlier, by reason of acceleration or otherwise, and at
all times thereafter, of the indebtedness, liabilities and obligations of every
kind and nature of Borrower to Lender arising under or in any way relating to
the Loan Agreement or any of the other Loan Documents, howsoever created,
incurred or evidenced, whether direct or indirect, absolute or contingent, now
or hereafter existing, due or to become due, and howsoever owned, held or
acquired by Lender (collectively, the "OBLIGATIONS"). Without limitation to the
foregoing, the Obligations shall include (a) all reasonable attorneys' and
paralegals' fees, including the cost of inside attorneys and paralegals, costs
and expenses and all court costs and costs of appeal incurred by Lender in
collecting any amount due Lender under this Guaranty or in prosecuting any
action against Borrower, Guarantor or any other guarantor with respect to all or
any part of the Obligations (collectively, the "ENFORCEMENT COSTS"), and (b) all
interest, fees, costs and expenses due Lender after the filing of a bankruptcy
petition by or against Borrower regardless of whether such amounts can be
collected during the pendency of the bankruptcy proceedings.
2.2. CONTINUING GUARANTY; GUARANTY OF PAYMENT. This Guaranty is a
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continuing guaranty of the Obligations, and Guarantor agrees that the
obligations of Guarantor to Lender hereunder shall be primary obligations, shall
not be subject to any counterclaim, set-off, abatement, deferment or defense
based upon any claim that Guarantor may have against Lender, Borrower or any
other person or entity.
2.3. LIABILITY OF GUARANTOR NOT AFFECTED. This Guaranty shall remain in
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full force and effect without regard to, and shall not be released, discharged
or affected in any way by, any circumstances or condition, including, without
limitation:
(a) the attempt or the absence of any attempt by Lender to obtain payment or
performance by Borrower or any other guarantor (this being a guaranty of
payment and performance and not of collection);
(b) Lender's delay in enforcing Guarantor's obligations hereunder or of any
other party under the Loan Documents, or any prior partial exercise by Lender of
any right or remedy hereunder or under any of the other Loan Documents;
(c) any renewal, extension, substitution, modification, replacement of or
indulgence with respect to, the Obligations, all of which Lender is hereby
authorized to make;
(d) the fact that Borrower is not liable for the payment or performance of
the Obligations, or any portion thereof, for any reason whatsoever, Guarantor
being liable for the Obligations notwithstanding that Borrower may not be;
(e) any sale, exchange, release, surrender or other disposition of, or
realization upon, any collateral securing the Obligations, or any settlement or
compromise of any guaranties of the Obligations, or any other obligation of any
person or entity with respect to the Loan Documents;
(f) the acceptance by Lender of any additional security for the Obligations;
(g) the lack of validity or enforceability of, or Lender's waiver or consent
with respect to, any provision of any instrument evidencing, securing or
otherwise relating to the Obligations, or any part thereof, including without
limitation the Loan Documents;
(h) the failure by Lender to take any steps to perfect, maintain, or enforce
its security interests or remedies under the Loan Documents, or to preserve its
rights to or protect any security or collateral, for the Obligations;
(i) any voluntary or involuntary bankruptcy, insolvency, reorganization,
arrangement, readjustment, assignment for the benefit of creditors, composition,
receivership, liquidation, marshalling of assets and liabilities or similar
event or proceedings with respect to Borrower or Guarantor, as applicable, or
any of their respective properties (each, an "INSOLVENCY PROCEEDING"), or any
action taken by Lender, any trustee or receiver or by any court in any such
proceeding;
(j) the failure by Lender to file or enforce a claim against the estate
(either in an Insolvency Proceeding or other proceeding) of Borrower or
Guarantor;
(k) in any proceeding under Title 11 of the United States Code (11 U.S.C.
Section 101 et seq.), as amended (the "BANKRUPTCY CODE"): (i) any election by
Lender under Section 1111(b)(2) of the Bankruptcy Code, (ii) any borrowing or
grant of a security interest by Borrower as debtor-in-possession under Section
364 of the Bankruptcy Code, (iii) the inability of Lender to enforce the
Obligations against Borrower by application of the automatic stay provisions of
Section 362 of the Bankruptcy Code, or (iv) the disallowance, under Section 502
of the Bankruptcy Code, of all or any portion of Lender's claim(s) against
Borrower for repayment of the Obligations;
(l) the failure of Guarantor to receive notice of any intended disposition
of the collateral for the Obligations;
(m) any merger or consolidation of Borrower into or with any other entity,
or any sale, lease or transfer of any of the assets of Borrower or Guarantor to
any other person or entity;
(n) any change in the ownership of Borrower, or any change in the
relationship between Borrower and Guarantor or any termination of any such
relationship;
(o) the death, incapacity, insanity, disability, dissolution or other change
in status of Borrower or Guarantor;
(p) the making of additional loans to Borrower, the increase or reduction of
the maximum principal amount of the Obligations, the increase or reduction in
the interest rate provided in the Notes, or any other modification, amendment,
release or waiver of the terms of the Loan Documents;
(q) the absence, impairment or loss of any right of reimbursement or
subrogation or other right or remedy of Guarantor; and
(r) any other circumstance which might otherwise constitute a legal or
equitable discharge or defense of Borrower, Guarantor or any other guarantor.
Guarantor hereby expressly waives and surrenders any defense to its
liability under this Guaranty based upon any of the foregoing acts, omissions,
agreements, waivers or matters, whether or not Guarantor had notice or knowledge
of same. It is the purpose and intent of this Guaranty that the obligations of
Guarantor hereunder shall be absolute and unconditional under any and all
circumstances.
2.4. RIGHTS OF LENDER. Lender is hereby authorized, without notice to or
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demand of Guarantor and without affecting the liability of Guarantor hereunder,
to take any of the following actions from time to time: (a) increase or
decrease the amount of, or renew, extend, accelerate or otherwise change the
time for payment of, or other terms relating to, the Obligations, or otherwise
modify, amend or change the terms of any promissory note or other agreement
evidencing, securing or otherwise relating to any of the Obligations, including,
without limitation, the making of additional advances thereunder; (b)
accept and apply any payments on or recoveries against the Obligations from any
source, and any proceeds of any security therefor, to the Obligations in such
manner, order and priority as Lender may elect in its sole discretion; (c) take,
hold, sell, release or otherwise dispose of all or any security for the
Obligations or the payment of this Guaranty; (d) settle, release, compromise,
collect or otherwise liquidate the Obligations or any portion thereof; (e)
accept, hold, substitute, add or release any other guaranty or endorsements of
the Obligations; and (f) upon the failure of Guarantor to perform any of the
Obligations, appropriate and apply toward payment of the Obligations (i) any
indebtedness due or to become due from Lender to Guarantor, and (ii) any moneys,
credits, or other property belonging to Guarantor at any time held by or coming
into the possession of Lender or any affiliates thereof, whether for deposit or
otherwise.
Without limiting the generality, scope or meaning of any of the foregoing
or any other provision of this Guaranty, Guarantor:
(a) waives all rights and defenses that Guarantor may have because the
Borrower's debt is secured by real property. This means, among other things:
(i) Lender may collect from Guarantor without first foreclosing on any real
or personal property collateral pledged by Borrower;
(ii) If Lender forecloses on any real property collateral pledged by
Borrower:
(1) the amount of the debt may be reduced only by the price for which that
collateral is sold at the foreclosure sale, even if the collateral is worth more
than the sale price; and
(2) Lender may collect from Guarantor even if Lender, by foreclosing on the
real property collateral, has destroyed any right Guarantor may have to collect
from Borrower;
(b) waives all rights and defenses, if any, now or hereafter arising under
the laws of the State of Illinois, which are the same as or similar to the
rights and defenses waived as described above.
This is an unconditional and irrevocable waiver of any rights and defenses
Guarantor may have because Borrower's debt is secured by real property.
2.5. SUBORDINATION. All indebtedness now or hereafter owing by Borrower to
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Guarantor for borrowed money or otherwise (the "INDEBTEDNESS TO GUARANTOR") is
hereby subordinated to the payment of the Obligations, and, subsequent to and
during the continuance of a default hereunder or under any of the other Loan
Documents, Guarantor shall not accept payment of all or any portion of such
Indebtedness to Guarantor until satisfaction in full of the Obligations. If
such payment is received by Guarantor, it shall be received and held in trust
for the benefit of Lender and shall be paid over promptly to Lender on account
of the indebtedness owed by Borrower to Lender, but without impairing or
affecting in any manner the liability of Guarantor for the Obligations. All
security interests, liens and encumbrances which Guarantor, or any one of them,
now or hereafter may have upon any of the assets of Borrower are hereby
subordinated to all security interests, liens and encumbrances heretofore, now
or hereafter granted to Lender pursuant to the Loan Documents. If Lender
forecloses on the Project or otherwise exercises its remedies under the Loan
Documents, any and all indebtedness of any Borrower to Guarantor shall be fully
released and discharged without any further action of Guarantor; provided that
upon request from Lender, Guarantor shall execute and deliver any documentation
reasonably requested by Lender to evidence such release.
3. GUARANTOR'S WAIVERS
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3.1. STATUTES OF LIMITATION. Guarantor irrevocably waives all statutes of
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limitation as a defense to any action or proceeding brought against Guarantor by
Lender, to the fullest extent permitted by law.
3.2. ELECTION OF REMEDIES. Guarantor irrevocably waives any defense based
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upon an election of remedies made by Lender or any other election afforded to
Lender pursuant to applicable law, including, without limitation, (a) any
election to proceed by judicial or nonjudicial foreclosure or by Uniform
Commercial Code sale or by deed or assignment in lieu thereof, or any election
of remedies which destroys or otherwise impairs the subrogation rights of the
Guarantor or the rights of the Guarantor to proceed against Borrower for
reimbursement, or both, (b) the waiver by Lender, either by action or inaction
of Lender or by operation of law, of a deficiency judgment against Borrower, and
(c) any election pursuant to an Insolvency Proceeding.
3.3. RIGHTS OF SUBROGATION AND OTHER RIGHTS. Until payment in full of the
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Obligations, Guarantor irrevocably waives (a) all rights at law or in equity to
seek subrogation, contribution, indemnification or any other form of
reimbursement or repayment from Borrower or any other person or entity now or
hereafter primarily or secondarily liable for any of the Obligations for any
disbursements made by Guarantor under or in connection with this Guaranty, (b)
all claims of any kind or type against Borrower as a result of any payment made
by Guarantor to Lender, and (c) any right to participate in any security now or
hereafter held by Lender. In furtherance, and not in limitation, of the
foregoing, Guarantor agrees that any payment to Lender pursuant to this Guaranty
shall be deemed a contribution to the capital of Borrower or other obligated
party and shall not constitute Guarantor a creditor of Borrower or such other
party. Guarantor further agrees that to the extent the waiver of its rights of
subrogation as set forth herein is found by a court of competent jurisdiction to
be void or voidable for any reason, any rights of subrogation Guarantor may have
against Borrower or against any collateral or security for any of the
Obligations shall be junior and subordinate to any rights Lender may have
against Borrower and to all right, title and interest Lender may have in such
collateral or security.
3.4. DEMANDS AND NOTICES. Guarantor irrevocably waives all presentments,
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demands for performance, protests, notices of protest, notices of dishonor,
notices of acceptance of this Guaranty and of the existence, creation or
incurring of new or additional Obligations, notices of defaults by Borrower or
any other person liable for the Obligations and demands and notices of every
kind that may be required to be given by any statute or rule or law, other than
notices specifically required by the terms of the Loan Documents.
3.5. BORROWER INFORMATION. Guarantor irrevocably waives (a) any duty of
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Lender to advise Guarantor of any information known to Lender regarding the
financial condition of Borrower (it being the obligation of Guarantor to keep
informed regarding such condition), and (b) any defense based on any claim that
Guarantor's obligations exceed or are more burdensome than those of Borrower.
3.6. LIMITATION OF LIABILITY. Guarantor irrevocably waives any impairment,
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modification, change, release or limitation of the liability of, or stay of
actions or lien enforcement proceedings against, Borrower or Guarantor, their
property, or their estate in bankruptcy, resulting from the operation of any
provision of the state or federal bankruptcy laws, or from the decision of any
court.
3.7. LACK OF DILIGENCE. Guarantor irrevocably waives any and all claims or
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defenses based upon lack of diligence in: (a) collection of any Obligations;
(b) protection of any collateral or other security for the Indebtedness or
Obligations; or (c) realization upon the other Loan Documents.
3.8. OTHER DEFENSES. Guarantor irrevocably waives any other defenses,
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set-offs or counterclaims which may be available to Borrower, or any other
Guarantor if there are more than one, and any and all other defenses now or at
any time hereafter available to Guarantor (including without limitation those
given to sureties) at law or in equity.
4. REPRESENTATIONS AND WARRANTS
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Guarantor represents and warrants to Lender as follows:
4.1. AUTHORITY; EXECUTION. This Guaranty has been duly and validly
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authorized, executed and delivered and constitutes the binding obligation of
Guarantor, enforceable in accordance with its terms.
4.2. FINANCIAL STATEMENTS. All financial statements and other financial
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information concerning Guarantor furnished or to be furnished to Lender (a) are
or will be true and correct in all material respects and do or will fairly
represent in all material respects the financial condition of Guarantor
(including all contingent liabilities), and (b) were or will be prepared in
accordance with generally accepted accounting principles, or such other
accounting principles as may be acceptable to Lender at the time of their
preparation, consistently applied. There has been no material adverse change in
Guarantor's financial condition since the dates of the statements most recently
furnished Lender.
4.3. NO DEFAULTS. There is no existing event of default, and no event has
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occurred which with the passage of time and/or the giving of notice or both will
constitute an event of default, under any agreement to which Guarantor is a
party, the effect of which event of default will impair performance by Guarantor
of the Obligations pursuant to and as contemplated by the terms of this
Guaranty, and neither the execution and delivery of this Guaranty nor compliance
with the terms and provisions hereof will violate any presently existing
provision of law or any presently existing regulation, order, writ, injunction
or decree of any court or governmental department, commission, board, bureau,
agency or instrumentality, or constitute a default under, any agreement to which
Guarantor is a party or by which Guarantor is bound.
4.4. NO LITIGATION. There are no actions, suits or proceedings pending or
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threatened against the Guarantor before any court or any governmental,
administrative, regulatory, adjudicatory or arbitrational body or agency of any
kind that will adversely affect performance by the Guarantor of Guarantor's
obligations pursuant to and as contemplated by the terms and provisions of this
Guaranty.
4.5. ACCURACY. Neither this Guaranty nor any document, financial statement,
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credit information, certificate or statement heretofore furnished or required
herein to be furnished to Lender by Guarantor contains any untrue statement of
fact or omits to state a fact material to this Guaranty.
5. EVENTS OF DEFAULT
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Upon the occurrence of any of the following events, Lender may, without
notice to Borrower or Guarantor, declare any or all of the Obligations, whether
or not then due, immediately due and payable by Guarantor under this Guaranty,
and Lender shall be entitled to enforce the obligations of Guarantor hereunder.
5.1. DEFAULT BY BORROWER. Borrower shall default in the payment or
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performance of any of the Obligations guarantied hereby, after giving effect to
any applicable notice and cure provisions set forth in the Loan Documents.
5.2. FAILURE TO PERFORM. Guarantor fails to perform any of its obligations
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under this Guaranty or any agreement under which security is given herefor, or
this Guaranty is revoked or terminated by Guarantor, or any representation or
warranty made or given by Guarantor to Lender proves to be false or misleading
in any material respect.
5.3. INSOLVENCY PROCEEDING. The making by Guarantor of any assignment for
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the benefit of creditors, or a trustee or receiver being appointed for Guarantor
or for any property of Guarantor, or Guarantor becoming insolvent or the subject
of any Insolvency Proceeding and, in the case of such a proceeding being
commenced against Guarantor, such proceeding is not dismissed within thirty (30)
days following the commencement date thereof.
6. MISCELLANEOUS
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6.1. REVIVAL AND REINSTATEMENT. If at any time all or any part of any
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payment theretofore applied by Lender to any of the Obligations is or must be
rescinded or returned by Lender for any reason whatsoever (including, without
limitation, the insolvency, bankruptcy or reorganization of Borrower), such
Obligations shall, for the purposes of this Guaranty, to the extent such payment
is or must be rescinded or returned, be deemed to have continued in
existence, notwithstanding such application by Lender, and this Guaranty shall
continue to be effective or be reinstated, as the case may be, as to such
Obligations, and Guarantor shall be fully liable therefore, all as though such
application by Lender had not been made.
6.2. NO MARSHALING. Lender has no obligation to marshal any assets in favor
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of Guarantor, or against or in payment of (a) any of the Obligations, or (b) any
other obligation owed to Lender by Guarantor, Borrower or any other person.
6.3. NO MODIFICATION, WAIVER OR RELEASE WITHOUT WRITING. Except as may
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otherwise be expressly set forth herein, this Guaranty may not be modified,
amended, revised, revoked, terminated, changed or varied in any way whatsoever,
nor shall any waiver of any of the provisions of this Guaranty be binding upon
Lender, except as expressly set forth in a writing duly executed by Lender. No
waiver by Lender of any default shall operate as a waiver of any other default
or the same default on a future occasion, and no action by Lender permitted
hereunder shall in any way affect or impair Lender's rights or the obligations
of Guarantor under this Guaranty.
6.4. ASSIGNMENT; SUCCESSORS AND ASSIGNS. Guarantor may not assign
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Guarantor's obligations or liability under this Guaranty. Subject to the
preceding sentence, this Guaranty shall be binding upon Guarantor and its
successors, assigns, heirs, executors and representatives and shall inure to the
benefit of Lender and its successors and assigns. Lender may, without notice to
anyone, sell or assign the Obligations, the Notes or other Loan Documents or any
part thereof, or grant participations therein, and in any such event each and
every assignee or holder of, or participant in, all or any of the Obligations
shall have the right to enforce this Guaranty, by suit or otherwise for the
benefit of such assignee, holder, or participant, as fully as if herein by name
specifically given such right, but Lender shall have an unimpaired right, prior
and superior to that of any such assignee, holder or participant, to enforce
this Guaranty for the benefit of Lender.
6.5. INTEGRATION. This Guaranty is the entire agreement of Guarantor with
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respect to the subject matter of this Guaranty, provided that this Guaranty
shall not in any way limit or abrogate the obligations of Guarantor under the
other Loan Documents, including, without limitation, the Hazardous Materials
Indemnity Agreement of even date herewith.
6.6. RIGHTS CUMULATIVE. All of Lender's rights or remedies under this
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Guaranty and the other Loan Documents are cumulative. The exercise of any one
right or remedy does not exclude the exercise of any other right given in this
Guaranty or the other Loan Documents or any other right or remedy of Lender not
set forth in this Guaranty or the other Loan Documents.
6.7. SEVERABILITY. Whenever possible each provision of this Guaranty shall
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be interpreted in such manner as to be effective and valid under applicable law,
but if any provision of this Guaranty shall be prohibited by or invalid under
such law, such provision shall be ineffective to the extent of such prohibition
or invalidity, without invalidating the remainder of such provision or the
remaining provisions of this Guaranty.
6.8. MATERIAL INDUCEMENT; CONSIDERATION. Guarantor acknowledges and agrees
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that Lender is specifically relying upon the representations, warranties,
agreements and waivers contained herein and that such representations,
warranties, agreements and waivers constitute a material inducement to Lender to
accept this Guaranty and to enter into the Loan Agreement and the transaction
contemplated therein. Guarantor further acknowledges that it expects to benefit
from Lender's extension of financing accommodations to Borrower because of its
relationship to Borrower, and that it is executing this Guaranty in
consideration of that anticipated benefit.
6.9. INDEMNIFICATION. Guarantor agrees to indemnify, pay and hold Lender
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and its respective officers, directors, employees, Lender, and attorneys
(collectively called the "INDEMNITEES") harmless from and against any and all
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
claims, costs, expenses and disbursements of any kind or nature whatsoever
(including the reasonable fees and disbursements of counsel for such Indemnitees
in connection with any investigative, administrative or judicial proceeding
commenced or threatened, whether or not such Indemnitee shall be designated a
party thereto) that may be imposed on, incurred by, or asserted against that
Indemnitee, in any manner relating to or arising out of this Guaranty or the
exercise of any right or remedy hereunder or under the other documents
pertaining to the Obligations (the "INDEMNIFIED LIABILITIES"); provided that
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Guarantor shall have no obligation to an Indemnitee under this subsection with
respect to Indemnified Liabilities arising from the gross negligence or willful
misconduct of that Indemnitee as determined by a court of competent
jurisdiction. To the extent that the undertaking to indemnify, pay and hold
harmless set forth in the preceding sentence may be unenforceable because it is
violative of any law or public policy, Guarantor shall contribute the maximum
portion that it is permitted to pay and satisfy under applicable law to the
payment and satisfaction of all Indemnified Liabilities incurred by the
Indemnitees or any of them.
6.10. COUNTERPARTS. This Guaranty may be executed in counterparts, each of
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which shall be deemed an original, but all of which, when taken together, shall
be deemed one and the same agreement.
6.11. GOVERNING LAW. This Guaranty shall be governed by and construed in
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accordance with the internal laws of the State of Illinois, without regard to
conflicts of law provisions.
6.12. INTENTIONALLY OMITTED.
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6.13. VENUE. GUARANTOR HEREBY CONSENTS TO THE JURISDICTION OF ANY STATE OR
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FEDERAL COURT LOCATED WITHIN THE COUNTY OF XXXX, STATE OF ILLINOIS AND
IRREVOCABLY AGREES THAT, SUBJECT TO LENDER'S ELECTION, ALL ACTIONS OR
PROCEEDINGS ARISING OUT OF OR RELATING TO THIS GUARANTY SHALL BE LITIGATED IN
SUCH COURTS. GUARANTOR EXPRESSLY SUBMITS AND CONSENTS TO THE JURISDICTION OF
THE AFORESAID COURTS AND WAIVES ANY DEFENSE OF FORUM NON CONVENIENS. GUARANTOR
HEREBY WAIVES PERSONAL SERVICE OF ANY AND ALL PROCESS AND AGREES THAT ALL SUCH
SERVICE OF PROCESS MAY BE MADE UPON GUARANTOR BY CERTIFIED OR REGISTERED MAIL,
RETURN RECEIPT REQUESTED, ADDRESSED TO SUCH GUARANTOR, AT THE ADDRESS SET FORTH
IN THIS AGREEMENT AND SERVICE SO MADE SHALL BE COMPLETE TEN (10) DAYS AFTER THE
SAME HAS BEEN POSTED.
6.14. WAIVER OF JURY TRIAL. GUARANTOR, AND BY ITS ACCEPTANCE OF THIS
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GUARANTY, LENDER, HEREBY WAIVE THEIR RESPECTIVE RIGHTS TO A TRIAL BY JURY IN ANY
ACTION OR PROCEEDING BASED UPON, OR RELATED TO, THE SUBJECT MATTER OF THIS
GUARANTY AND THE BUSINESS RELATIONSHIP THAT IS BEING ESTABLISHED. THIS WAIVER
IS KNOWINGLY, INTENTIONALLY AND VOLUNTARILY MADE BY GUARANTOR, AND BY LENDER'S
ACCEPTANCE OF THIS GUARANTY, LENDER AND GUARANTOR ACKNOWLEDGE THAT NEITHER
LENDER NOR ANY PERSON ACTING ON BEHALF OF LENDER HAS MADE ANY REPRESENTATIONS OF
FACT TO INDUCE THIS WAIVER OF TRIAL BY JURY OR HAS TAKEN ANY ACTIONS WHICH IN
ANY WAY MODIFY OR NULLIFY ITS EFFECT.
6.15. WAIVERS. THE WAIVERS SET FORTH IN THIS GUARANTY (INCLUDING, WITHOUT
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LIMITATION, SECTIONS 6.13 AND 6.14 ABOVE) ARE KNOWINGLY, INTENTIONALLY, AND
VOLUNTARILY MADE BY GUARANTOR, AND GUARANTOR ACKNOWLEDGES THAT NEITHER LENDER
NOR ANY PERSON ACTING ON BEHALF OF LENDER, HAS MADE ANY REPRESENTATIONS OF FACT
TO INDUCE THESE WAIVERS OR IN ANY WAY TO MODIFY OR NULLIFY THEIR EFFECT.
GUARANTOR FURTHER ACKNOWLEDGES THAT IT HAS BEEN REPRESENTED (OR HAS HAD THE
OPPORTUNITY TO BE REPRESENTED) IN THE SIGNING OF THIS GUARANTY AND IN THE MAKING
OF THESE WAIVERS BY INDEPENDENT LEGAL COUNSEL, SELECTED OF ITS OWN FREE WILL,
AND THAT IT HAS HAD THE OPPORTUNITY TO DISCUSS THESE WAIVERS WITH COUNSEL.
7. LIMITATION OF LIABILITY
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Except as provided in the next sentence, the maximum liability of Guarantor
under this Guaranty is limited to the principal amount of Two Million Five
Hundred Thousand and No/100 Dollars ($2,500,000.00); plus accrued and unpaid
interest and all Enforcement Costs.
In addition to the amounts set forth in the preceding sentence, Guarantor shall,
jointly and severally with Borrower, be personally liable for:
(a) all losses, damages, costs and expenses (including, without limitation,
attorney's fees), causes of action, suits, claims, demands and judgments of any
nature or description whatsoever, which may be imposed upon, incurred by or
awarded against Lender or any affiliate thereof as a result of:
(i) any failure after the occurrence and during the continuance of any
default (without benefit of any applicable grace or cure period) to apply any
portion of the gross income from the Project to the Loan or to customary
operating expenses of the Project,
(ii) fraud by Borrower or Guarantor,
(iii) any misappropriation of any funds derived from the Project,
(iv) any material misrepresentation by Borrower or Guarantor,
(v) any material waste or abandonment of the Project,
(vi) failure to keep the Project insured in accordance with the terms of the
Loan Documents,
(vii) fees paid to Guarantor or any affiliate of Borrower or Guarantor after
any default (other than a default occurring solely due to a default under the
Other Loan Instruments (as defined in the Mortgage)) or any Event of Default
under the Loan Documents, or
(viii) any breach of any representation, warranty, covenant or obligation
concerning Hazardous Materials (as defined in the Environmental Indemnity) set
forth in the Loan Agreement or set forth in the Environmental Indemnity, each as
amended from time to time; and
(b) repayment of the Loan and all other obligations of Borrower under the
Loan Documents in the event of (i) any breach of any of the covenants in
Sections 11 or 12 of the Mortgage pertaining to change of control, transfers of
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interests and additional encumbrances, (ii) any breach of the warranty set forth
in Section 4.16 of the Loan Agreement (single asset entity), or (iii) the
filing by Borrower, or the filing against Borrower by Guarantor, of any
proceeding for relief under any federal or state bankruptcy, insolvency or
receivership laws or any assignment for the benefit of creditors made by
Borrower.
Neither this Guaranty nor any of the provisions contained herein
(including, without limitation, this Section 7) shall in any manner affect or
limit or reduce in any way the liability of Guarantor under the Environmental
Indemnity.
The undersigned have duly executed this Guaranty as of the date and year first
above written.
EMERITUS CORPORATION, a Washington corporation
By /s/ Xxxxxxx X. Xxxxxxxxxx
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Name Xxxxxxx X. Xxxxxxxxxx
Its CFO
