GUARANTY
(Emeritus)
WHEREAS, TDC/Emeritus Paso ▇▇▇▇▇▇ Associates,
a Washington
general partnership ("Borrower"), is or will
become indebted to FINOVA Capital Corporation
("Lender").
NOW, THEREFORE, for valuable consideration,
the receipt and adequacy of which are hereby
acknowledged, the undersigned (whether one or
more, Guarantor ) hereby guarantees to Lender the
prompt payment at maturity (by acceleration or
otherwise), and at all times thereafter, of the
Guaranteed Indebtedness (hereinafter defined),
this Guaranty being upon the following terms and
conditions:
l. As used throughout this Guaranty, the term
"Borrower" shall include, without limitation,
Borrower, Borrower as a debtor-in-possession, and
any receiver, trustee, liquidator, conservator,
custodian, or similar party hereafter appointed
for Borrower or all or substantially all of its
assets pursuant to any liquidation,
conservatorship, bankruptcy, moratorium,
rearrangement, receivership, insolvency,
reorganization, or similar Debtor Relief Law
(hereinafter defined) from time to time in effect
affecting the rights of creditors generally.
2. The term "Guaranteed Indebtedness," as
used herein means the (a) "Indebtedness" as that
term is defined in the Deed of Trust, Security
Agreement, Assignment of Leases and Rents and
Fixture Filing (herein called the "Deed of Trust")
dated of even date herewith, executed by Borrower
in favor of Chicago Title Company, as trustee for
the benefit of Lender including without limiting
the generality of the foregoing, the obligation to
pay when due all sums due under that certain
Promissory Note of even date therewith in the
original principal amount of $6,000,000.00,
executed by Borrower and payable to the order of
Lender (the "Note"); (b) interest on any of the
indebtedness described in clause (a) preceding,
whether accruing prior to or after maturity of
such indebtedness; (c) any and all costs,
reasonable attorneys' fees, and expenses incurred
by Lender by reason of Borrower's default in
payment of any of the foregoing indebtedness; and
(d) any renewal or extension of the indebtedness,
costs, or expenses described in clauses (a)
through (c) preceding, or any part thereof.
3. This instrument shall be an absolute and
continuing Guaranty,
and the circumstance that at any time or from time
to time the Guaranteed Indebtedness may be paid in
full shall not affect the obligation of Guarantor
with respect to the indebtedness of Borrower to
Lender thereafter incurred.
4. If Guarantor becomes liable for any
indebtedness owing by Borrower to Lender, by
endorsement or otherwise, other than under this
Guaranty, such liability shall not be in any
manner impaired or affected hereby, and the rights
of Lender hereunder shall be cumulative of any and
all other rights that Lender may ever have against
Guarantor. The exercise by Lender of any right or
remedy hereunder or under any other instrument, or
at law or in equity, shall not preclude the
concurrent or subsequent exercise of any other
right or remedy. Guarantor covenants and agrees
that it will not assert any rights arising from
payment or other performance hereunder until all
of Guarantor's liability hereunder shall have been
discharged in full and all of the Guaranteed
Indebtedness existing at the time of such
discharge shall have been paid and performed in
full.
5. Upon the occurrence of an "Event of
Default," as defined in the Loan Agreement of even
date herewith between Borrower and Lender as
amended, ("Loan Agreement"), Guarantor shall, on
demand and without further notice of dishonor,
without any notice having been given to Guarantor
previous to such demand of the acceptance by
Lender of this Guaranty, and without any notice
having been given to Guarantor previous to such
demand of the creating or incurring of such
indebtedness, pay the amount due thereon to
Lender, and it shall not be necessary for Lender,
in order to enforce such payment by Guarantor,
first or contemporaneously to institute suit or
exhaust remedies against Borrower or others liable
on such indebtedness, or to enforce rights against
any security which shall ever have been given to
secure such indebtedness.
6. All principal of and interest on all
indebtedness, liabilities and obligations to
Guarantor of Borrower, any partner of Borrower or
any other party guaranteeing all or any portion of
the Guaranteed Indebtedness (the "Subordinated
Debt"), whether direct, indirect, fixed,
contingent, liquidated, unliquidated, joint,
several, or joint and several, now or hereafter
existing, due or to become due to Guarantor, or
held or to be held by Guarantor, whether created
directly or acquired by assignment or otherwise,
and whether evidenced by written instrument or
not, shall be expressly subordinated to the
Guaranteed Indebtedness pursuant to that certain
Subordination Agreement between Guarantor and
Lender of even date herewith.
7. Guarantor hereby agrees that its
obligations under the terms of this Guaranty shall
not be released, diminished, impaired, reduced, or
affected by the occurrence of any one or more of
the following events: (a) the taking or accepting
of any other security or Guaranty for any or all
of the Guaranteed Indebtedness; (b) any release,
surrender, exchange, subordination, or toss of any
security at any time existing in connection with
any or all of the Guaranteed Indebtedness; (c) any
partial release of the liability of Guarantor
hereunder, or, if there is more than one person or
entity signing this Guaranty, the release of any
one or more of them hereunder, or the partial
release of any party at any time liable for the
payment of any or all of the Guaranteed
Indebtedness; (d) the death, insolvency,
bankruptcy, disability, or lack of partnership or
corporate power of Borrower, any of the
undersigned, or any party at any time liable for
the payment of any or all of the Guaranteed
Indebtedness, whether now existing or hereafter
occurring; (e) any renewal, extension, or
rearrangement of the payment of any or all of the
Guaranteed Indebtedness, either with or without
notice to or consent of Guarantor, or any
adjustment, indulgence, forbearance, or compromise
that may be granted or given by Lender to Borrower
or Guarantor; (f) any neglect, delay, omission,
failure, or refusal of Lender to take or prosecute
any action for the collection of any of the
Guaranteed Indebtedness or to foreclose or take or
prosecute any action in connection with any
instrument or agreement evidencing or securing all
or any part of the Guaranteed Indebtedness; (g)
any failure of Lender to notify Guarantor of any
renewal, extension, or assignment of the
Guaranteed Indebtedness or any part thereof, or
the release of any security or of any other action
taken or refrained from being taken by Lender
against Borrower or any new agreement between
Lender and Borrower, it being understood that
Lender shall not be required to give Guarantor any
notice of any kind under any circumstances
whatsoever with respect to or in connection with
the Guaranteed Indebtedness; (h) the
unenforceability of all or any part of the
Guaranteed Indebtedness against Borrower by reason
of the fact that the Guaranteed Indebtedness
exceeds the amount permitted by law, the act of
creating the Guaranteed Indebtedness, or any part
thereof, is ultra ▇▇▇▇▇, or the partners creating
same acted in excess of their authority or
violated any fiduciary duties
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in connection therewith; or (i) any payment by
Borrower to Lender is held to constitute a
preference under the bankruptcy laws or if for any
other reason Lender is required to refund such
payment or pay the amount thereof to someone else.
Without limiting the generality of the foregoing
or any other provisions hereof, the Guarantor
expressly waives any and all benefits which might
otherwise be available to Guarantor under
California Civil Code Sections 2809, 2810, 2839,
2845, 2849, 2850, 2899 and 3433, in each instance
to the extent such laws, or any one of them, are
applicable to the Guaranty, any of the Loan
Documents, any of the Obligations or any of the
Indebtedness.
8. Guarantor hereby waives all rights by
which it might be entitled to require suit on an
accrued right of action in respect of any of the
Guaranteed Indebtedness or require suit against
Borrower or others.
9. The Guarantor shall not assert, enforce or
otherwise exercise any right of subrogation to any
of the rights or interests of the Lender against
the Borrower or any other obligor on the
Guaranteed Indebtedness or any collateral or other
security, any right of recourse, reimbursement,
contribution, indemnification or similar right
against the Borrower or any other obligor on all
or any part of the Guaranteed Indebtedness or any
guarantor thereof, and the Guarantor hereby
irrevocably waives any and all of the foregoing
rights. The Guarantor irrevocably waives the
benefit of and any right to participate in any
collateral or other security given to the Lender
to secure payment of the Guaranteed Indebtedness.
10. Should Guarantor become insolvent, or
fail to pay such Guarantor's debts generally as
they become due, or voluntarily seek, consent to,
or acquiesce in the benefit or benefits of any
Debtor Relief Law (as used herein, "Debtor Relief
Law" means the Bankruptcy Code [as amended, herein
so called) of the United States of America and the
Bankruptcy Act [as amended, herein so called) of
Canada and any other applicable liquidation,
conservatorship, bankruptcy, moratorium,
rearrangement, receivership, insolvency,
reorganization, suspension of payments, or similar
debtor relief law from time to time in effect
affecting the rights of creditors generally), or
become a party to (or be made the subject or any
proceeding provided for by any Debtor Relief Law
(other than as a creditor or claimant) that could
suspend or otherwise adversely affect the rights
of Lender granted hereunder, then, in any such
event, the Guaranteed Indebtedness shall be, as
between Guarantor and Lender, a fully matured,
due, and payable obligation of Guarantor to Lender
(without regard to whether there exists an Event
of Default or whether the Indebtedness, or any
part thereof is then due and owing by Borrower to
Lender), payable in full by Guarantor to Lender
upon demand, which shall be the estimated amount
owing in respect of the contingent claim created
hereunder.
11. Guarantor represents and warrants that
the value of the consideration received and to be
received by Guarantor is reasonably worth at least
as much as the liability and obligation of
Guarantor hereunder, and such liability and
obligation may reasonably be expected to benefit
Guarantor directly or indirectly.
12. By execution hereof, Guarantor covenants
and agrees to provide to Lender copies of those
financial statements and income tax returns of
Guarantor as required under the Loan Agreement.
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13. This Guaranty is for the benefit of
Lender and Lender's successors and assigns, and in
the event of an assignment of the Guaranteed
Indebtedness, or any part thereof, the rights and
benefits hereunder, to the extent applicable to
the indebtedness so assigned, may be transferred
with such indebtedness. This Guaranty is binding
not only on Guarantor, but on Guarantor's
successors and assigns and, if this Guaranty is
signed by more than one person or entity, then all
of the obligations of Guarantor arising hereunder
shall be jointly and severally binding on each of
the undersigned and their respective successors
and assigns. Lender shall have no recourse under
this Guaranty against the natural person who
executed this Guaranty or against any other
officer, director or shareholder of Guarantor;
however, the foregoing shall not affect or limit
Lender's remedies available by operation of law in
the event Guarantor dissolves, is liquidated or
otherwise ceases to exist.
14. THIS GUARANTY SHALL BE DEEMED TO HAVE
BEEN EXECUTED, DELIVERED AND ACCEPTED IN AND THIS
GUARANTY SHALL BE CONSTRUED IN ACCORDANCE WITH AND
GOVERNED BY THE INTERNAL LAWS AND DECISIONS OF THE
STATE OF ARIZONA (WITHOUT REGARD FOR ITS CONFLICTS
OF LAW PRINCIPLES), THE STATE IN WHICH LENDER'S
PRINCIPAL PLACE OF BUSINESS IS LOCATED, AND BY
EXECUTION HEREOF GUARANTOR AGREES THAT SUCH LAWS
AND DECISIONS OF THE STATE OF ARIZONA SHALL GOVERN
THIS GUARANTY NOTWITHSTANDING THE FACT THAT THERE
MAY BE OTHER JURISDICTIONS WHICH MAY BEAR A
REASONABLE RELATIONSHIP TO THE TRANSACTIONS
CONTEMPLATED HEREBY.
15. GUARANTOR HEREBY AGREES THAT ALL ACTIONS
OR PROCEEDINGS INITIATED BY GUARANTOR AND ARISING
DIRECTLY OR INDIRECTLY OUT OF THIS GUARANTY OR THE
OTHER LOAN DOCUMENTS SHAI.L BE LITIGATED IN THE
SUPERIOR COURT OF ARIZONA, MARICOPA COUNTY
DIVISION, OR THE UNITED STATES COURT FOR THE
DISTRICT OF ARIZONA OR, IF LENDER INITIATES SUCH
ACTION, IN ADDITION TO THE FOREGOING COURTS ANY
COURT IN WHICH ANY PROPERTY DESCRIBED IN THE LOAN
DOCUMENTS IS LOCATED, TO THE EXTENT SUCH COURT HAS
JURISDICTION. GUARANTOR HEREBY EXPRESSLY SUBMITS
AND CONSENTS IN ADVANCE TO SUCH JURISDICTION IN
ANY. ACTION OR PROCEEDING COMMENCED BY LENDER IN
ANY OF SUCH COURTS, AND AGREES THAT SERVICE OF ANY
REQUIRED SUMMONS AND COMPLAINT OR OTHER PROCEEDS
OR PAPERS MAY BE MADE BY REGISTERED OR CERTIFIED
MAIL ADDRESSED TO THE GUARANTOR AS SET FORTH
BELOW. GUARANTOR WAIVES ANY CLAIM THAT PHOENIX,
ARIZONA OR THE DISTRICT OF ARIZONA IS AN
INCONVENIENT FORUM OR AN IMPROPER FORUM BASED ON
LACK OF VENUE. SHOULD GUARANTOR, AFTER BEING SO
SERVED, FAIL TO APPEAR OR ANSWER TO ANY SUNINIONS,
COMPLAINT PROCESS OR PAPERS PROPERLY SERVED WITHIN
THE NUMBER OF DAYS PRESCRIBED BY LAW AFTER THE
MAILING THEREOF, GUARANTOR SHALL BE DEEMED IN
DEFAULT AND AN ORDER AND/OR JUDGMENT MAY BE
ENTERED BY A COURT IN ACCORDANCE WITH APPLICABLE
LAW AND PROCEDURE AGAINST GUARANTOR AS DEMANDED OR
PRAYED FOR IN SUCH SUMMONS, COMPLAINT, PROCESS OR
PAPERS TO THE EXTENT PERMITTED BY LAW. THE
EXCLUSIVE CHOICE OF FORUM FOR GUARANTOR SET FORTH
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HEREIN SHALL NOT BE DEEMED TO PRECLUDE THE
ENFORCEMENT, BY LENDER, OF ANY JUDGMENT OBTAINED
IN ANY OTHER FORUM OR THE TAKING, BY LENDER OF ANY
ACTION TO ENFORCE THE SAME IN ANY OTHER
APPROPRIATE JURISDICTION AND GUARANTOR HEREBY
WAIVES THE RIGHT TO COLLATERALLY ATTACK ANY SUCH
JUDGMENT OR ACTION.
16. FOR AND IN CONSIDERATION OF LENDER'S
ADVANCEMENT TO BORROWER OF THE PRINCIPAL SUMS IN
THE AMOUNT OF UP TO SIX MILLION AND NO/100 DOLLARS
($6,000,000.00), GUARANTOR, BEING A PARTNER OF
BORROWER AND AN EXPERIENCED OWNER AND OPERATOR OF
REAL ESTATE AND A PARTICIPANT IN SOPHISTICATED
REAL ESTATE VENTURES, AND HAVING CONSULTED WITH
COUNSEL OF ITS CHOOSING, HEREBY WAIVES ANY RIGHT
TO TRIAL BY JURY WITH RESPECT TO ANY ACTION OR
PROCEEDING ( 1 ) BROUGHT BY GUARANTOR, LENDER OR
ANY OTHER PERSONS RELATING TO (A) THE LOAN
EVIDENCED BY THE NOTE OR (B) THIS GUARANTY OR (2)
TO WHICH LENDER IS A PARTY. GUARANTOR HEREBY
AGREES THAT THIS GUARANTY CONSTITUTES A WRITTEN
CONSENT TO WAIVER OF TRIAL BY JURY, AND GUARANTOR
DOES HEREBY CONSTITUTE AND APPOINT LENDER ITS TRUE
AND LAWFUL ATTORNEY IN FACT, WHICH APPOINTMENT IS
COUPLED WITH AN INTEREST AND IRREVOCABLE, AND
GUARANTOR DOES HEREBY AUTHORIZE AND EMPOWER
LENDER, IN THE NAME, PLACE, AND STEAD OF
GUARANTOR, TO FILE THIS GUARANTY WITH THE CLERK OR
JUDGE OF ANY COURT OF COMPETENT JURISDICTION AS A
WRITTEN CONSENT TO WAIVER OF TRIAL BY JURY.
GUARANTOR ACKNOWLEDGES THAT ITS WAIVER OF TRIAL BY
JURY HAS BEEN MADE KNOWINGLY, INTENTIONALLY AND
WILLINGLY BY GUARANTOR AS PART OF A BARGAINED FOR
LOAN TRANSACTION. GUARANTOR WILL NOT SEEK TO
CONSOLIDATE ANY SUCH ACTION, IN WHICH A JURY TRIAL
HAS BEEN WAIVED, WITH ANY OTHER ACTION IN WHICH A
JURY TRIAL CANNOT OR HAS NOT BEEN WAIVED.
17. THIS GUARANTY SHALL TERMINATE AND BE OF
NO FURTHER FORCE OR EFFECT UPON THE PAYMENT IN
FULL OF THE GUARANTEED INDEBTEDNESS AND NO FURTHER
WRITING SHALL BE REQUIRED TO EFFECTUATE SUCH
TERMINATION HEREOF IN SUCH EVENT.
18. Provided there is no Event of Default or
Incipient Default of which Borrower has received
notice from Lender at such time, on the fifth
anniversary of the Loan Closing, Lender will
consider a reduction in the amount of the
Guaranteed Indebtedness, such reduction, if any,
to be in such amounts and upon such terms as
Lender, in its sole and absolute discretion, may
determine.
19. It is the intent of Guarantor and Lender
that the laws of the State of Arizona apply to
this Guaranty as set forth in paragraph 14 above;
however, in the event a court with jurisdiction
rules that the laws of the State of California
apply to and govern this Guaranty, then Guarantor
hereby waives (i) any and all benefits available
to sureties and creditors which might otherwise be
available to Guarantor under the California Civil
Code, including, without limitation, Sections
2809, 2810, 2819, 2839, 2845, 2849, 2850, 2899 and
3433; and (ii) all rights and defenses that
Guarantor may have because the
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Obligations (as defined in the Loan Agreement) are
secured by real property. This means, among other
things: ( 1 ) Lender may collect from Guarantor
without first foreclosing on any real or personal
property collateral pledged by Borrower, (2) if
Lender forecloses on any real property collateral
pledged by Borrower: (A) 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, (B) 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. This is an
unconditional and irrevocable waiver of any rights
and defenses Guarantor may have because the
Obligations are secured by real property. These
rights and defenses include, but are not limited
to, any rights or defenses based upon Section
580a, 580b, 580d, or 726 of the California Code of
Civil Procedure. Furthermore, Guarantor waives all
rights and defenses arising out of an election of
remedies, even though that election of remedies,
such as a nonjudicial foreclosure with respect to
security for the Guaranteed Indebtedness, has
destroyed Guarantor's rights of subrogation and
reimbursement against the principal by the
operation of Section 580d of the California Code
of Civil Procedure or otherwise.
20. Any notice, request or other
communication required or permitted to be given
hereunder may be given and shall conclusively be
deemed and considered to have been given and
received upon the deposit thereof, in writing, in
the U.S. Mail, certified mail, return receipt
requested, postage prepaid, and addressed to the
party to receive such notice at the address set
forth below or such address elected in writing by
the party to receive such notice; but actual
notice however given or received, shall always be
effective. The last preceding sentence shall not
be construed in anywise to effect or impair the
waiver of notice or demand to or upon Guarantor in
any situation or for any reason (except as
otherwise specifically provided).
If to Guarantor: Emeritus Corporation
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇ I
with copy to: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, Esq.
The ▇▇▇▇▇▇▇▇▇ Group
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
If to Lender: FINOVA Capital
Corporation
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇
▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
with copy to: FINOVA Capital
Corporation
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇,
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn.: Vice President - Group
Counsel
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21. Unless otherwise defined herein, all
capitalized terms used herein shall have the same
meaning as set forth in the Loan Agreement.
EXECUTED effective as of February 18,1997.
EMERITUS CORPORATION, a
Washington corporation
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
-------------------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
Title: President
THE STATE OF WASHINGTON )
) ss
COUNTY OF KING )
On this 18th day of February, 1997, before
me, ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, the undersigned notary
public, duly commissioned and sworn, personally
appeared ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇, personally known
to me (or proved to me the basis of satisfactory
evidence) to be the person that executed the
within instrument and acknowledged to me that the
or she executed the same in his or her authorized
capacity and that by his or her signature in the
instrument the person, or the entity upon behalf
of which the person acted, executed the
instrument.
IN WITNESS WHEREOF, I have hereunto set my
hand and affixed my official seal the day and year
in this certificate first above written.
/s/ ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
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Notary Public
My Commission Expires:
3-30-99
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[SEAL]
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