1
EXHIBIT 10.2
SECOND AMENDED AND RESTATED LOAN AGREEMENT
THIS SECOND AMENDED AND RESTATED LOAN AGREEMENT (this "Agreement") made
and entered into as of this 26th day of April, 2000 between ALTERRA HEALTHCARE
CORPORATION, a Delaware corporation (the "Company"), and RDVEPCO, L.L.C., a
Michigan limited liability company ("Lender").
Recitals:
---------
The parties entered into a Loan Agreement dated as of December 13, 1999
pursuant to which the Company borrowed from Lender on December 14, 1999 the sum
of Fourteen Million Dollars ($14,000,000.00) (the "Original Loan Agreement").
The parties entered into an Amended and Restated Loan Agreement (the
"First Amended Loan Agreement") dated as of February 3, 2000 to amend the terms
of the Original Loan Agreement and on February 4, 2000, the Company borrowed an
additional Twenty Million Dollars ($20,000,000.00), for a total increased loan
amount of Thirty-Four Million Dollars ($34,000,000.00) (the "$34 Million Loan").
The parties wish to amend and restate the First Amended Loan Agreement on
the terms and conditions set forth herein.
NOW, THEREFORE, the parties promise and agree as follows:
ARTICLE I
Definitions
-----------
In addition to terms defined elsewhere in this Agreement, the following
definitions shall apply for purposes of this Agreement:
"Alterra Equity Transaction" shall mean the consummation of the
transaction contemplated by the Purchase Agreement.
"Bankruptcy Law" means Title 11, U.S. Code or any similar federal
or state law for the relief of debtors.
"Business Day" means a day other than a Saturday, a Sunday or a day
on which banking institutions in the City of Grand Rapids, Michigan are
authorized by law, regulation or executive order to remain closed. If a
payment date is not a Business Day, payment may be made on the next
succeeding day that is a Business Day.
2
"Collateral Real Estate" means, collectively, the Original
Collateral Real Estate, the First Additional Collateral Real Estate and
the Second Additional Collateral Real Estate.
"Contract" means any contract, agreement, undertaking or commitment
(written or oral, formal or informal, firm or contingent) to which the
Company or any of its Subsidiaries is a party or by which the Company, any
of its Subsidiaries, or any of their respective assets are bound, and
which has current operative or executory effect.
"Default" means any event that is or with the passage of time or the
giving of notice or both would be an Event of Default.
"First Additional Collateral Real Estate" means the parcels of
improved real estate owned by the Company identified on Exhibit A to this
Agreement.
"GAAP" means generally accepted accounting principles set forth from
time to time in the opinions and pronouncements of the Accounting
Principles Board and the American Institute of Certified Public
Accountants and statements and pronouncements of the Financial Accounting
Standards Board (or agencies with similar functions of comparable stature
and authority within the U.S. accounting profession), which are applicable
to the circumstances as of the date of determination.
"Governmental Authority" means the United States, any state or
municipality, the government of any foreign country, any subdivision of
any of the foregoing, or any authority, department, commission, board,
bureau, agency, court, or instrumentality of any of the foregoing.
"Hedging Obligations" means, with respect to any Person, the
obligations of such Person under (i) currency exchange or interest rate
swap agreements, currency exchange or interest rate cap agreements and
currency exchange or interest rate collar agreements and (ii) other
agreements or arrangements designed to protect such Person against
fluctuations in currency exchange or interest rates.
"Holder" means the Lender and any subsequent holder of the $34
Million Note and/or the $25 Million Note.
"Holding" means AHC Purchaser Holding, Inc., a Delaware
corporation.
"Indebtedness" means, with respect to any Person, any indebtedness
of such Person, whether or not contingent, in respect of borrowed money or
evidenced by bonds, notes, debentures or similar instruments or letters of
credit (or reimbursement agreements in respect thereof) or banker's
acceptances or representing obligations in respect of a lease that would
at such time be required to be capitalized on a balance sheet in
accordance with GAAP or the balance deferred and unpaid of the purchase
price of any property (other than contingent or "earnout" payment
obligations) or representing any
2
3
Hedging Obligations, except any such balance that constitutes an accrued
expense or trade payable, if and to the extent any of the foregoing
indebtedness (other than letters of credit and Hedging Obligations) would
appear as a liability upon a balance sheet of such Person prepared in
accordance with GAAP, as well as all indebtedness of others secured by a
Lien on any asset of such Person (whether or not such indebtedness is
assumed by such Person) and, to the extent not otherwise included, the
guarantee, whether or not conditional, by such Person of any indebtedness
of any other Person.
"Initial Disbursement" shall have the meaning set forth in
Section 2.1.
"Initial Disbursement Date" shall have the meaning set forth in
Section 2.1.
"Lien" means, with respect to any asset, any mortgage, lien, pledge,
charge, security interest or encumbrance of any kind in respect of such
asset, whether or not filed, recorded or otherwise perfected under
applicable law (including any conditional sale or other title retention
agreement, any lease in the nature thereof, any option or other agreement
to sell or give a security interest in and any filing of or agreement to
give any financing statement under the Uniform Commercial Code (or
equivalent statutes) of any jurisdiction).
"LLCs" means those limited liability companies to be vested with fee
simple title to the properties comprising the Second Additional Collateral
Real Estate as identified on Exhibit B to this Agreement at the time of
the Second Disbursement.
"Material Adverse Effect" shall have the meaning set forth in the
Purchase Agreement.
"Mortgage Modifications" shall mean the amendments to the existing
mortgages or deeds of trust and related assignments of leases and rents,
if applicable, encumbering the Original Collateral Real Estate and the
First Additional Collateral Real Estate, as contemplated under Article IV
hereof.
"New Mortgages" shall mean the mortgages, deeds of trust and related
assignments of leases and rents, if applicable, encumbering the Second
Additional Collateral Property and being delivered at the Second
Disbursement.
"Obligations" means any principal, interest, penalties, fees,
indemnifications, reimbursements, damages and other liabilities payable
under the documentation governing any Indebtedness.
"Original Collateral Real Estate" means the parcels of unimproved
real estate owned by the Company identified on Exhibit C to this
Agreement.
"Permitted Liens" means (i) Liens for taxes and assessments or
governmental charges or levies not at the time due, (ii) easements that do
not impair or restrict the
3
4
Company's or Subsidiary's use and enjoyment of the property affected
thereby, and (iii) those certain mechanic's and materialmen's liens set
forth on Exhibit D to this Agreement and referenced in the lawsuits
referenced on Schedule 3.1(ee) of the Purchase Agreement, and (iv) such
other mechanic's, materialmen's, laborer's supplier's and other similar
liens, inchoate or filed, arising or resulting from construction
activities at or on the Second Additional Collateral Real Estate of which
the amount claimed pursuant to such liens, in the aggregate, does not
exceed $500,000.00.
"Person" means any individual, corporation, partnership, limited
liability company, joint venture, association, joint-stock company, trust,
unincorporated organization, government or any agency or political
subdivision thereof or any other entity.
"Purchase Agreement" means that certain Purchase Agreement of even
date between the Company, the Lender and the other Purchasers party
thereto with respect to the Alterra Equity Transaction.
"Purchasers" means those investor-parties to the Purchase
Agreement.
"Second Additional Collateral Real Estate" means the parcels of
improved and unimproved real estate owned by the LLCs identified on
Exhibit E to this Agreement.
"Second Disbursement" shall have the meaning set forth in Section
2.1.
"Second Disbursement Date" shall have the meaning set forth in
Section 2.1.
"Subsidiary" means any corporation, partnership, limited
partnership, limited liability company, association or other business
entity of which securities or other ownership interests representing more
than fifty percent (50%) of the ordinary voting power are, at the time as
of which any determination is being made, owned or controlled by the
Company or one or more Subsidiaries of the Company.
"SEC" means the Securities and Exchange Commission.
"1934 Act" means the Securities Exchange Act of 1934, as amended.
"1933 Act" means the Securities Act of 1933, as amended.
ARTICLE II
$25 Million Loan and $34 Million Loan; $25 Million Note and $34 Million Note;
-----------------------------------------------------------------------------
$25 Million Note Closing Date; Fees
-----------------------------------
2.1. $25 Million and $34 Million Loan; $25 Million Note and $34 Million
Note. On December 14, 1999 pursuant to the Original Loan Agreement, Lender
disbursed to Company the sum of Fourteen Million Dollars ($14,000,000.00) in
principal amount evidenced by a
4
5
promissory note in the form of Exhibit B to the Original Loan Agreement (the
"Original Note"). On February 4, 2000 pursuant to the First Amended Loan
Agreement, Lender loaned to the Company the additional sum of Twenty Million
Dollars ($20,000,000.00) and, in connection therewith, Lender cancelled the
Original Note and, in substitution therefor, the Company delivered to Lender the
promissory note in the form of Exhibit C to the First Amended Loan Agreement
(the "Original $34 Million Note"). Under and subject to the terms and conditions
of this Agreement, the Company shall deliver an amended and restated promissory
note in the form of Exhibit F attached hereto (the "$34 Million Note") to extend
the maturity of the Original $34 Million Note and the Company shall borrow from
Lender up to an additional Twenty Five Million Dollars ($25,000,000.00) (the
"$25 Million Loan"). The $34 Million Loan and the $25 Million Loan shall
collectively be referred to herein as the "Loans". At the time of the initial
disbursement (the "Initial Disbursement") under the $25 Million Note of Six
Million Three Hundred Four Thousand and No/100 Dollars ($6,304,000.00), the
Company shall execute and deliver to Lender: (i) a promissory note in the form
of Exhibit G attached hereto (the "$25 Million Note"), the terms and conditions
of which are incorporated in and made a part of this Agreement; (ii) the $34
Million Note, the terms of which are incorporated in and made a part of this
Agreement; (iii) the Mortgage Modifications; and (iv) the Amended and Restated
Stock Pledge and Amended and Restated Guaranty described in Article IV. On the
date (the "Second Disbursement Date") of the next occurring disbursement of
Seven Million Six Hundred Ninety-Six Thousand and No/100 Dollars ($7,696,000.00)
of the $25 Million Dollar Loan (the "Second Disbursement"), the Company shall
execute and deliver to Lender (i) the New Mortgages, and (ii) the LLCs and
ALS-WovenHearts, Inc. shall guaranty the Loans upon and subject to the terms and
conditions hereinafter set forth. The funds disbursed at the Second Disbursement
shall be disbursed directly to or paid for the benefit of the Company and in
accordance with the attached Schedule 2.1. The remainder of the $25 Million Loan
shall be advanced by Lender and disbursed by Lender to or paid for the benefit
of the Company, in each case as approved by Lender in its absolute discretion,
to discharge Liens against and pay construction costs related to the Second
Additional Collateral Real Estate (as described on Exhibit B as "To Be
Developed") and for such other purposes in each case as approved by Lender in
its absolute discretion. This is not a revolving credit agreement and any part
of the principal of either the $34 Million Note or the $25 Million Note which
has been repaid from time to time may not be reborrowed. The $34 Million Note
and the $25 Million Note hereinafter shall collectively be referred to as the
"Notes". At the $25 Million Note Closing, Lender shall cancel the Original $34
Million Note.
2.2. Closing; Closing Date. The closing of the $25 Million Loan (the "$25
Million Note Closing") and the Initial Disbursement Date shall occur at 10:00
a.m. at the offices of ▇▇▇▇▇▇ & ▇▇▇▇▇▇ on or before April 26, 2000 or such other
time and place as the parties may agree in writing (the "$25 Million Note
Closing Date") upon satisfaction of the terms and conditions under this
Agreement as set forth in Article IV, below.
2.3. Fees. In addition to the fees previously paid pursuant to the
Original Loan Agreement and the First Amended Loan Agreement, on or before the
$25 Million Note Closing, the Company agrees to pay to the Lender a commitment
fee of Five Hundred Thousand and No/100 Dollars ($500,000.00). If not paid prior
to the $25 Million Note Closing, the Company agrees that Lender may deduct the
commitment fee due on or before the $25 Million Note
5
6
Closing Date from the proceeds of the $25 Million Loan. On the third (3rd) day
of each month, starting with May 3, 2000, Company shall pay to Lender facility
fees equal to Thirteen Thousand Three Hundred Thirty Three and No/100 Dollars
($13,333.00), multiplied by a fraction, the numerator of which is the amount by
which the outstanding principal amount of the $34 Million Note at such date
exceeds Fourteen Million Dollars ($14,000,000.00) and the denominator of which
is One Million Dollars ($1,000,000.00). None of such facility fees shall be
prorated in the event of prepayment of the Notes. If any facility fee is not
paid when due, interest shall accrue thereon at the Default Interest Rate, as
defined in Section 3.1(a).
ARTICLE III
Terms of the Loans and the Notes
--------------------------------
3.1. Interest Rate; Payment; Usury.
------------------------------
(a) Provided that no Event of Default has occurred and is continuing
and subject to the other provisions of this Agreement: (i) during the
period from and including February 4, 2000 to, but not including, the date
on which all outstanding principal and accrued and unpaid interest and
fees on the Loans have been paid in full, principal amount of the Loans
outstanding from time to time shall bear interest at the rate of ten
percent (10%) per annum. During any period that an Event of Default shall
have occurred and be continuing, interest on principal amount of the Loans
outstanding from time to time shall accrue at a rate equal to fifteen
percent per annum (15%) (the "Default Interest Rate"). Notwithstanding
anything contained herein to the contrary, in no event shall the interest
rate on the Loans, including the Default Interest Rate, exceed the highest
rate permitted by applicable law. Interest on the Loans, including
interest at the Default Interest Rate, shall be based on a 360 day year
and interest shall accrue and be payable for the actual number of calendar
days elapsed. Interest on the principal amount outstanding from time to
time shall be payable monthly in arrears beginning on April 30, 2000 and
on the last day of each month thereafter until the principal and all
accrued interest and facility fees have been paid in full.
(b) It is the intention of the Company and Lender to conform
strictly to applicable usury laws now or hereafter in force, and any
interest payable under this Agreement or the Notes shall be subject to
reduction to an amount not to exceed the maximum non-usurious amount for
commercial loans allowed under such applicable usury laws as now or
hereafter construed by the courts having jurisdiction over such matters.
In the event such interest (whether designated as interest, service
charges, points, or otherwise) does exceed the maximum legal rate, it
shall be (i) canceled automatically to the extent that such interest
exceeds the maximum legal rate; (ii) if already paid, at the option of the
Holder, either be rebated to the Company or credited on the principal
amount of the Loans; or (iii) if the Loans have been prepaid in full, then
such excess shall be rebated to the Company. It is further agreed, without
limitation of the foregoing, that all calculations of the rate of interest
contracted for, charged, or received under this Agreement and the Notes
that are made for the purpose of determining whether such rate exceeds the
6
7
maximum legal rate, shall be made, to the extent permitted by applicable
law, by amortizing, prorating, allocating, and spreading throughout the
full stated term of the Loans (and any extensions of the term thereof that
may be hereafter granted) all such interest at any time contracted for,
charged, or received from the Company or otherwise by the Holder so that
the rate of interest on account of the Loans, as so calculated is uniform
throughout the term thereof. If the Company is exempt or hereafter becomes
exempt from applicable usury statutes or for any other reason the rate of
interest to be charged on the Loans is not limited by law, none of the
provisions of this paragraph shall be construed so as to limit or reduce
the interest or other consideration payable under this Agreement or the
Notes or under the instrument securing payment thereof. The terms and
provisions of this paragraph shall control and supersede every other
provision of all agreements between the parties hereto.
3.2. Maturity.
---------
(a) $34 MILLION NOTE. Unless the same shall become due earlier as a
result of acceleration of the maturity, the $34 Million Note shall mature
on the earlier of (i) the Initial Closing (as such term is defined in the
Purchase Agreement) of the Alterra Equity Transaction or (ii) the initial
closing of a Financing Proposal that is a Superior Proposal (as such terms
are defined in the Purchase Agreement) or (iii) February 2, 2001, at which
time the outstanding principal balance of the $34 Million Loan and all
accrued and unpaid interest and facility fees shall become due and
payable.
(b) $25 MILLION NOTE. Unless the same shall become due earlier as a
result of acceleration of the maturity, the $25 Million Note shall mature
on the earlier of (i) the Initial Closing (as such term is defined in the
Purchase Agreement) of the Alterra Equity Transaction or (ii) the Initial
Closing of a Financing Proposal that is a Superior Proposal (as such terms
are defined in the Purchase Agreement) or (iii) June 30, 2000, at which
time the outstanding principal balance of the $25 Million Loan and all
accrued and unpaid interest shall become due and payable.
3.3. Prepayments; Partial Releases.
------------------------------
(a) The Company may from time to time prepay the Loans, in whole or
in part, at any time. Any partial prepayment shall be applied first to
interest which is accrued and unpaid, including interest on any delinquent
facility fees, then to the payment of any facility fees that are due and
payable and then to principal.
(b) As to the First Additional Collateral Real Estate, attached
hereto as Schedule 3.3 is a schedule of each release price (the "Release
Prices") applicable to each parcel. From and after the payment in full of
all amounts owed under the $25 Million Note, upon payment by the Company
of the Release Price applicable to any particular parcel of First
Additional Collateral Real Estate and during such time as no Default or
Event of Default is then outstanding, Holder shall cause any and all
mortgages, deeds of trust, assignments of leases and rents, UCCs and other
security documents encumbering
7
8
such First Additional Collateral Real Estate to be released and marked
satisfied of record. No such partial release shall limit or impair the
right of Lender in any other collateral pledged hereunder.
(c) Upon the payment in full of all sums due and owing under the $25
Million Note, provided no Default or Event of Default is then outstanding,
Holder shall deliver to the Company the original, cancelled $25 Million
Note, cause any and all New Mortgages, UCCs and other security documents
encumbering each or any of the Second Additional Collateral Real Estate
properties to be released and marked satisfied of record and cancel and
release the Guaranties of the LLCs and ALS-WovenHearts, Inc., and the
collateral assignments of LLC interests and any other security interests
related solely to the Second Additional Collateral Real Estate.
3.4. Manner of Payment. The Company shall make payments in respect of the
Loans (including principal and interest) by wire transfer of immediately
available funds to the account specified by the Holder.
3.5. Events of Default. Each of the following constitutes an "Event
of Default":
(i) default for five (5) days in the payment when due of
interest or any facility fee on the Loans;
(ii) default in payment when due of the principal of the Loans;
(iii) failure of the Company to pay on or before the due date
thereof any construction or other costs and expenses with respect to the
First Additional Collateral Real Estate required in order for such
properties to receive governmental approval for occupancy as assisted
living facilities, elder care facilities or Alzheimer care units (provided
nothing herein shall be deemed or construed as creating an obligation of
Lender to fund any construction or pay any Liens with respect to any of
the Collateral Real Estate or as creating an obligation of the Company to
fund any construction or pay any Liens with respect to any of the Second
Additional Collateral Real Estate);
(iv) failure by the Company for 15 days after notice from the Holder
to comply with the provisions described under Article VI hereof; provided,
however, if the curing of such failure may not reasonably be accomplished
within such time frame, the Company shall have such additional time as is
necessary to effect such cure (not to exceed 30 days);
(v) failure by the Company to comply with any of the covenants
described in Sections 6.1 (a)(i), (a)(ii) and (c) and 6.2 (a) and (b) (no
notice or opportunity to cure being applicable) or failure by the Company
for 30 days after notice from the Holder to comply with any of its other
covenants or agreements in this Agreement or the Notes; provided, however,
if the curing of such failure may not reasonably be accomplished within
such time frame, the Company shall have such additional time as is
necessary to effect such cure (not to exceed 60 days);
8
9
(vi) any of the representations or warranties of the Company set
forth in the Original Loan Agreement, First Amended Loan Agreement, or
this Agreement or incorporated herein by reference or set forth in any
statement or schedule delivered pursuant to the Original Loan Agreement,
First Amended Loan Agreement, or this Agreement was untrue or incorrect in
any material respect as of the date of execution of the Original Loan
Agreement, First Amended Loan Agreement, or this Agreement, respectively
or as of the $25 Million Note Closing Date as if made on such date;
(vii) default by the Company or any of its Subsidiaries under any
mortgage, indenture or instrument under which there may be issued or by
which there may be secured or evidenced any Indebtedness of the Company or
any of its Subsidiaries, whether such Indebtedness now exists, or is
created after the date hereof, which default results in the acceleration
of such Indebtedness prior to its express maturity (or if such default
consists of a failure to pay upon the express maturity date) and the
principal amount of such Indebtedness, together with the principal amount
of any other such Indebtedness the maturity of which has been so
accelerated, aggregates $5,000,000 or more (or, from and after the Second
Disbursement Date, as to ALS-WovenHearts, Inc. and each LLC, in any
amount);
(viii) failure by the Company or any of its Subsidiaries to pay
final judgments aggregating in excess of $1,000,000 (or, from and after
the Second Disbursement Date, as to ALS-WovenHearts, Inc. and each LLC, in
any amount), which judgments are not paid, discharged or stayed for a
period of 45 days (or, from and after the Second Disbursement Date, as to
ALS-WovenHearts, Inc. and each LLC, 5 days, except with respect to the
Permitted Liens);
(ix) the Company or any of its Subsidiaries pursuant to or within
the meaning of Bankruptcy Law:
(a) commences a voluntary case,
(b) consents to the entry of an order for relief against it in
an involuntary case,
(c) consents to the appointment of a custodian of it or
for all or substantially all of its property,
(d) makes a general assignment for the benefit of its
creditors, or
(e) generally is not paying its debts as they become due; or
(x) a court of competent jurisdiction enters an order or decree in
an involuntary case or proceeding under any Bankruptcy Law that:
9
10
(a) is for relief against the Company or any of its
Subsidiaries;
(b) appoints a custodian of the Company or any of its
Subsidiaries or for all or substantially all of the property of the
Company or any of its Subsidiaries; or
(c) orders the liquidation of the Company or any of its
Subsidiaries;
and the order or decree remains unstayed and in effect for 60
consecutive days.
(xi) From and after the Second Disbursement Date, any of the
Company's interest in any LLC becoming subject to any Lien
or other charge or encumbrance other than in favor of
Lender.
(xii) From and after the Second Disbursement Date, any interest in
any LLC becoming owned directly or indirectly by anyone
other than the Company.
(xiii) Any default or any event of default occurring under any
agreement between Lender and the Company and/or any of its
Subsidiaries, including those described in Section 4.1, but
expressly excluding defaults under the Purchase Agreement.
(xiv) Any foreclosure, forfeiture or similar Lien enforcement
proceeding (but expressly excluding such actions involving
any Permitted Lien) existing whereby any sale or other
action by which the Company's or, after the Second
Disbursement Date, any LLC's or WovenHearts' interest in any
Collateral Real Estate may be involuntarily transferred and
such sale or other action (including, but not limited, to a
public or private sale or judicial hearing) has been
scheduled and not indefinitely adjoined no later than ten
(10) days before the scheduled sale or other action.
3.6. Acceleration.
-------------
(a) Declaration of Acceleration. If any Event of Default occurs and
is continuing, the Holder may, upon notice to the Company, declare the
Loans to be due and payable immediately; and upon any such declaration all
principal and interest on the Loans shall become immediately due and
payable; provided, however, in the case of an Event of Default arising
from certain events of bankruptcy or insolvency described in clauses (ix)
and (x) of Section 3.5 hereof, with respect to the Company or any
Subsidiary, the Loans shall ipso facto become due and payable without
further action or notice on the part of the Holder.
(b) Rescission. At any time after a declaration of acceleration with
respect to the Loans, the Holder may, in its sole discretion, rescind and
cancel such declaration and
10
11
its consequences. No such rescission shall affect any subsequent Default
or impair any right with respect thereto.
3.7. Other Remedies. If an Event of Default occurs and is continuing, the
Holder may pursue any available remedy to collect the payment of principal and
interest (including interest at the Default Interest Rate) on the Loans and to
enforce the performance of any provision of the Notes or this Agreement and any
other agreement related to any Loan. A delay or omission by the Holder in
exercising any right or remedy accruing upon an Event of Default shall not
impair the right or remedy or constitute a waiver of or acquiescence in the
Event of Default. All remedies are cumulative to the extent permitted by law.
3.8. Waiver Of Past Defaults. The Holder may waive any existing Default or
Event of Default and its consequences under this Agreement. Upon any such
waiver, such Default shall cease to exist, and any Event of Default arising
therefrom shall be deemed to have been cured for every purpose of this
Agreement; but no such waiver shall extend to any subsequent or other Default or
impair any right consequent thereon.
3.9. Priorities. Any sums collected by the Holder hereunder and under the
Notes shall be applied first to all costs and expenses of collection, including
reasonable attorneys' fees, then to accrued and unpaid interest (including at
the Default Interest Rate to the extent applicable), then to facility fees, and
then to principal.
ARTICLE IV
Conditions
----------
4.1. Conditions to Lender's Obligations. Lender's obligation to make
advances under the $25 Million Loan shall be subject to the prior satisfaction
of the following conditions, except to the extent waived by Lender in writing:
(a) Prior to or contemporaneously with the Initial Disbursement,
Company shall have paid to the Lender the commitment fee due on or before
the $25 Million Note Closing Date required pursuant to Section 2.3, above,
and shall have reimbursed Lender for the fees and expenses for which
Company is liable pursuant to the terms of Section 7.4, below, to the
extent documented to Company as of the Closing.
(b) Prior to or contemporaneously with the Initial Disbursement,
with respect to each parcel of the Original Collateral Real Estate and the
First Additional Collateral Real Estate, Company shall have executed and
caused to be duly recorded the Mortgage Modifications.
(c) Prior to or contemporaneously with the Second Disbursement, with
respect to the Second Additional Collateral Real Estate:
11
12
(i) Company shall have provided evidence reasonably
satisfactory to Lender that the costs incurred by the Company
through March 31, 2000 for the Second Additional Collateral Real
Estate aggregated not less than ($24,900,000.00) and the cost
required to be expended in order to receive governmental approval
for occupancy thereof is not in excess of Sixteen Million Two
Hundred Thousand and No/100 Dollars ($16,200,000.00) plus
remobilization costs, interest, penalties, costs for additional
materials, change orders and to repair deterioration occasioned as a
result of the slowdown/cessation of construction activities and all
other costs, all of which shall not exceed $2,000,000.00 in the
aggregate;
(ii) at the time of any disbursement, none of the such
Collateral Real Estate shall be subject to any Lien unacceptable to
Lender other than Permitted Liens;
(iii) prior to or contemporaneously with the Second
Disbursement, Company shall have provided to Lender surveys,
environmental reports and such other matters as reasonably required
by Lender relating to the Second Additional Collateral Real Estate
and Lender shall be satisfied therewith in its sole discretion;
(iv) prior to or contemporaneously with the Second
Disbursement, Lender shall have received the commitment for the
issuance by Chicago Title Insurance Company of an ALTA lender's
policy of title insurance (without standard exceptions and with such
endorsement as directed by Lender) with respect to each of the
Second Additional Collateral Real Estate (collectively, the
"Additional Title Commitments");
(v) prior to or contemporaneously with the Second
Disbursement, as to the Second Additional Collateral Real Estate
designated as "To Be Developed" on Exhibit B, the Company, as sole
member of the LLC's vested with title to the Second Additional
Collateral Real Estate shall have executed and caused to be duly
recorded the New Mortgages in favor of Lender in forms reasonably
acceptable to Lender and its counsel encumbering each of such
properties and shall have executed and filed Forms UCC 1 with
respect to the personal property located and to be located at each
of such properties in forms reasonably acceptable to Lender and its
counsel and shall have provided evidence of each of the foregoing
requirements to Lender; and
(vi) prior to or contemporaneously with the Second
Disbursement, as to the Second Additional Collateral Real Estate
designated as "Not To Be Developed" on Exhibit B, Company, as sole
member of the LLCs and sole shareholder of ALS-WovenHearts, Inc.,
shall have executed and caused to be duly recorded the New
Mortgages, in forms reasonably acceptable to Lender and its counsel
and shall have provided evidence of each of the foregoing
requirements to Lender.
12
13
(d) Prior to or contemporaneously with the First Disbursement,
Holding shall have executed and delivered an amended and restated guaranty
and the Company shall have executed and delivered an amended and restated
stock pledge agreement with respect to the stock of Holding. Holding shall
have guaranteed the Loans in form and substance satisfactory to Lender and
its counsel.
(e) Prior to or simultaneously with the Second Disbursement, the
LLCs and WovenHearts shall have executed and delivered guaranties of the
Loans and the Company shall have pledged to Lender as collateral security
for the performance of its obligations pursuant to this Agreement and the
Notes its interests in the LLCs in form and substance satisfactory to
Lender and its counsel.
(f) At each disbursement, as applicable, Lender shall have received
an opinion of ▇▇▇▇▇▇ & ▇▇▇▇▇▇, counsel to Company, Holding,
ALS-WovenHearts, Inc. and the LLCs, in form and substance acceptable to
the Lender and its counsel and opinions of local counsel reasonably
satisfactory to Lender and its counsel with respect to the validity and
enforceability of each form of the Mortgage Modifications and New
Mortgages, as applicable.
(g) Each of the representations and warranties of the Company set
forth in this Agreement or incorporated herein by reference and of the
Company, Holding, ALS-WovenHearts, Inc. and each LLC set forth in any
other agreement and statement or schedule delivered pursuant to this
Agreement are true and correct in all material respects as of the date of
execution of this Agreement, as of the date of each advance under the $25
Million Loan, and as of the $25 Million Note Closing Date, as if made on
each such date.
(h) At each disbursement, as applicable, the Company shall not be in
default with respect to any of its covenants and agreements set forth in
Article VI of this Agreement or set forth elsewhere in this Agreement.
(i) At each disbursement, no Default or Event of Default shall have
occurred and be continuing.
4.2. Waiver. Lender may waive in writing any of the conditions to its
obligations set forth in Section 4.1 in its sole discretion.
4.3. Conditions to Closing. Both Lender's and the Company's obligations
hereunder shall be subject to the prior satisfaction of the following condition,
except to the extent waived by both Lender and the Company in writing:
(a) The Company and Purchasers shall have executed and delivered the
Purchase Agreement.
13
14
ARTICLE V
Representations and Warranties
------------------------------
5.1. Representations and Warranties of the Company. In order to induce the
Lender to enter into this Agreement, the Company represents and warrants to the
Lender, which representations and warranties shall survive the Closing and be
independent of any investigation or lack of investigation of Company made by or
on behalf of Lender, as follows with such representations and warranties to be
effective as to the Company and WovenHearts and Holding as of the date of this
Agreement and with such representations and warranties as to the LLCs to be
effective as of the Initial Disbursement Date:
(a) Organization and Standing; Issued and Outstanding Shares. Each
of the Company, the LLCs, ALS-WovenHearts, Inc. ("WovenHearts") and
Holding is duly incorporated or formed, as the case may be, and validly
existing under the laws of the State of Delaware, and has all requisite
power and authority to own or lease its properties and assets and to
conduct its business as it has been and is proposed to be conducted. Each
of the Company, the LLCs, WovenHearts and Holding is qualified to do
business and in good standing in each jurisdiction in which the failure to
so qualify could have a material adverse effect upon its assets,
properties, liabilities, financial condition, results of operations or
business. Holding has no Subsidiaries other than AHC Purchaser, Inc., all
of the issued and outstanding shares of which are owned by Holding. The
Certificate of Incorporation or Operating Agreement, as applicable, and
amendments thereto of each of Holding, WovenHearts, the LLCs and AHC
Purchaser, Inc., are in the form previously provided to Lender. The issued
and outstanding capital stock of Holding is as set forth in Schedule
5.1(a). As of the Initial Disbursement Date, the Company will own 100% of
the membership interests and be the sole member of each of the LLCs. The
Company owns 100% of the shares of capital stock of WovenHearts.
(b) Indebtedness and Contracts of Holding and LLCs. Except for such
Contracts or Indebtedness as are contemplated hereby or thereby as set
forth on Schedule 5.1(b), the LLCs and Holding have no Indebtedness and
are not a party to any Contracts (whether formal or informal, written or
oral, firm or contingent), other than (i) the pledge by Holding of the
capital stock of AHC Purchaser, Inc., delivered in connection with the
recent financing provided by GMAC, and (ii) those Contracts to be assigned
by the LLCs to Lender as provided in Section 4.1(c)(v) of this Agreement
on the Initial Disbursement Date.
(c) Capacity of the Company; Consents; Execution of Agreements. The
Company has the requisite power, authority, and capacity to enter into
this Agreement and the agreements contemplated hereby and to perform the
transactions and obligations to be performed by the Company hereunder and
thereunder. Holding, WovenHearts and the LLCs have the requisite power,
authority and capacity to enter into the agreements contemplated hereby,
as applicable, and to perform the transaction and obligations to be
14
15
performed by Holding, WovenHearts and the LLCs thereunder, as applicable.
Except as described on Schedule 5.1(c) hereto, no consent, authorization,
approval, license, permit or order of, or filing with, any Person or
Governmental Authority is required in connection with the execution and
delivery of this Agreement or the performance by the Company, Holding, the
LLCs, or WovenHearts of the transactions and obligations to be performed
by it hereunder, except as contemplated by this Agreement. The failure to
obtain any of the consents described on Schedule 5.1(c) prior to the $25
Million Note Closing Date will not have a material adverse effect upon the
Company's assets, properties, liabilities, financial condition, results of
operations or business. The execution and delivery of this Agreement and
the performance of the transactions and obligations contemplated hereby by
the Company have been (or, with respect to the LLCs will be) duly
authorized by all requisite action of the Company, the LLCs, WovenHearts
and Holding, as applicable. This Agreement has been duly executed and
delivered by a duly authorized officer of the Company and constitutes, or
when executed and delivered will constitute, a valid and legally binding
agreement of the Company, enforceable in accordance with its terms, except
as enforcement thereof may be limited by bankruptcy, insolvency,
reorganization, moratorium or other similar laws, both state and federal,
affecting the enforcement of creditors' rights or remedies in general from
time to time in effect and the exercise by courts of equity powers or
their application of principles of public policy.
(d) Status of Notes. The Notes to be issued hereunder, when issued
by the Company to the Lender pursuant to the terms of this Agreement, will
be duly authorized and validly issued.
(e) Conflicts; Defaults. The execution and delivery of this
Agreement and the execution by the LLCs, Holding and WovenHearts of a
guaranty of the Loans and the pledge by Company of the membership
interests of the LLCs and the shares of Holding to secure the Company's
obligations hereunder and under the Notes, and the performance by the
Company, the LLCs, WovenHearts and Holding of the transactions and
obligations contemplated hereby and thereby to be performed by each will
not: (i) violate, conflict with, or constitute a default under any of the
terms or provisions of its certificate of incorporation or bylaws or its
Operating Agreement, as applicable, or any provisions of, or result in the
acceleration of any obligation under, any Contract, note, debt instrument,
security agreement, or other instrument to which the Company, the LLCs,
Holding, WovenHearts or any other Subsidiary is a party or by which the
Company, the LLCs, Holding, WovenHearts or any other Subsidiary or any of
their respective assets is bound, except for such conflicts, violations,
breaches or defaults which would not have, or reasonably be expected to
have, a Material Adverse Effect; (ii) result in the creation or imposition
of any Liens or claims upon the assets of the Company, Holding,
WovenHearts or any other Subsidiary or their issued and outstanding
capital stock (except as contemplated by this Agreement); (iii) constitute
a violation of any law, statute, judgment, decree, order, rule, or
regulation of a Governmental Authority applicable to the Company, the
LLCs, Holding, WovenHearts or any other Subsidiary; or (iv) constitute an
event which, after notice or lapse of time or both, would result in any of
15
16
the foregoing. None of the Company, the LLCs, Holding, WovenHearts or AHC
Purchaser, Inc. is presently in violation of any provision of its
certificate of incorporation or bylaws as to such corporations or its
certificate of formation or operating agreement as to each LLC. None of
the Company, the LLCs, Holding, WovenHearts or any Subsidiary is presently
in default in any material respect under any of the terms or provisions of
any of its material Contracts, notes, debt instruments, security
agreements, or other instruments, except for the matters set forth on
Schedule 3.1(j) of the Purchase Agreement and except for such defaults
which would not have, or reasonably be expected to have a Material Adverse
Effect, or any order, judgment, or decree relating to it or its business
or by which it or any of its assets is bound.
(f) Periodic Reports. The Company has timely filed with the SEC all
periodic reports heretofore required to be filed by it pursuant to the
1934 Act and all such periodic reports (including the financial statements
or information forming a part thereof) are complete and comply, in all
material respects, with the requirements of the SEC applicable to such
periodic reports and financial statements.
(g) Compliance with Laws. The Company, WovenHearts and the LLCs are
not in violation of, nor do any of their operations violate in any
respect, any statute, law, or regulation of any Governmental Authority
applicable to the Company, any of their assets, or the conduct of its
business ("Applicable Laws"), the violation of which reasonably could be
anticipated to have a Material Adverse Effect upon the Company's or a
Material Adverse Effect upon the LLCs' assets, properties, liabilities,
financial condition, results of operations or business, and no material
expenditures are or, based on present requirements, will be required of
the Company or the LLCs in order for it to comply or remain in compliance
with any Applicable Laws.
(h) Litigation. Except as set forth in Schedule 3.1(ee) to the
Purchase Agreement, the Company is not a party to any material legal
action, suit, claim, investigation or proceeding which is not adequately
described in a periodic report heretofore filed by the Company with the
SEC and, to the best of the Company's knowledge and belief after due
inquiry, there exist no facts or circumstances which reasonably could be
anticipated to result in any such action, suit, claim, investigation, or
proceeding. None of the LLCs are a party to any material legal action,
suit, claim, investigation or proceeding which are not listed on Schedule
3.1(ee) of the Purchase Agreement and, to the best of the Company's
knowledge and belief after due inquiry, there exist no facts or
circumstances which reasonably could be anticipated to result in any such
action, suit, claim, investigation or proceeding, other than the Permitted
Liens.
(i) Taxes. The Company has prepared and duly and timely filed with
each appropriate Governmental Authority, all material federal, state,
municipal, local and foreign tax returns, information returns and other
reports required to be filed on or before the date of this Agreement and
has paid all material taxes required to be paid by the Company prior to
the date of this Agreement in respect of the periods covered by such
returns and reports, except such taxes as are being contested in good
faith.
16
17
(j) Environmental Compliance. The LLCs and the Company and its
Subsidiaries are in compliance with all applicable federal, state and
local laws and requirements (including permit requirements) relating to
the protection of health or the environment in connection with the
ownership, operation and condition of its properties and business, except
where failure to comply would not have material adverse effect.
(k) Securities Laws. No consent, authorization, approval, permit, or
order of or filing with any Governmental Authority is required in order
for the Company to execute and deliver this Agreement or to offer, issue,
sell, or deliver the $25 Million Note. Based in part on the
representations of the Lender and under the circumstances contemplated
hereby and under current laws and regulations, the offer, issuance, sale
and delivery of the Note to the Lender is exempt from the prospectus
delivery and registration requirements of the 1933 Act.
(l) Hedging Obligations. The LLCs and the Company and its
Subsidiaries do not have any outstanding Hedging Obligations except to the
extent entered into pursuant to and in compliance with any credit
agreements to which they may be a party.
(m) Disclosure. The Company has fully responded to all written
requests for information and has accurately answered, to the best of the
Company's knowledge and belief after due inquiry, all written questions
from the Lender concerning the assets, properties, liabilities, financial
condition, results of operations, business and prospects of the Company,
and has not knowingly withheld any facts relating thereto which it
reasonably believed to be material with respect to the assets, properties,
liabilities, financial condition, results of operations, business or
prospects of the Company. No information in this Agreement, or in any
Schedule or Exhibit attached to this Agreement or delivered to Lender in
connection herewith, contains any untrue statement of a material fact or
when considered together with all such information delivered to the Lender
omits to state any material fact necessary in order to make the statements
made in the light of the circumstances under which they were made, when
taken as a whole, not misleading. The disclosures made in writing by the
Company in connection with this Agreement do not contain any untrue
statement of a material fact nor omit to state a material fact necessary
to make the statements made therein not misleading. There is no fact or
circumstance relating to the Company which materially and adversely
affects or in the future may, in the reasonable business judgment of the
Company, be expected materially and adversely to affect the same which has
not been set forth in this Agreement or the Schedules hereto.
(n) Changes in Circumstances. Since December 31, 1999, and except as
set forth or referenced in the Purchase Agreement, Company has not
suffered any material adverse change in its assets, properties,
liabilities, financial condition, results of operations, business or
prospects.
17
18
(o) Contracts. Except for this Agreement, the Purchase Agreement and
the agreements contemplated hereby, the Company has filed all material
contracts required to be filed by Item 601(b)(10) of Regulation S-K under
the 1933 Act and the 1934 Act.
(p) Second Additional Collateral Real Estate. The amounts set forth
(and the evidence provided in support) in Section 4.1(c)(i) and the
amounts set forth on Exhibit D are true, correct and complete in all
material respects.
5.2 Representations and Warranties of the Lender. The Lender represents
and warrants to the Company that:
(a) Investment Intent. The Notes are being acquired for its own
account and not with the view to, or for resale in connection with, any
distribution or public offering thereof within the meaning of the 1933
Act. The Lender understands that the Notes have not been registered under
the 1933 Act by reason of its issuance in a transaction exempt from the
registration and prospectus delivery requirements of the 1933 Act pursuant
to Section 4(2) thereof. It further understands that the Notes will bear
the following legend and agrees that it will hold the Notes subject
thereto:
THIS NOTE HAS NOT BEEN REGISTERED PURSUANT TO THE SECURITIES ACT OF
1933 OR ANY STATE SECURITIES LAW. NEITHER THIS NOTE NOR ANY PORTION
HEREOF OR INTEREST HEREIN MAY BE SOLD, ASSIGNED, TRANSFERRED,
PLEDGED OR OTHERWISE DISPOSED OF UNLESS THE SAME IS REGISTERED UNDER
SAID ACT AND ANY APPLICABLE STATE SECURITIES LAW, OR UNLESS AN
EXEMPTION FROM SUCH REGISTRATION IS AVAILABLE AND THE COMPANY SHALL
HAVE RECEIVED, AT THE EXPENSE OF THE HOLDER HEREOF, EVIDENCE OF SUCH
EXEMPTION REASONABLY SATISFACTORY TO THE COMPANY (WHICH MAY INCLUDE,
AMONG OTHER THINGS, AN OPINION OF COUNSEL SATISFACTORY TO THE
COMPANY).
(b) Capacity of the Lender; Execution of Agreement. Lender has all
requisite power, authority, and capacity to enter into this Agreement, and
to perform the transactions and obligations to be performed by it
hereunder. This Agreement has been duly authorized, executed and delivered
by it and constitutes its valid and legally binding obligation,
enforceable in accordance with its terms, except as enforcement thereof
may be limited by bankruptcy, insolvency, reorganization, moratorium or
other similar laws, both state and federal, affecting the enforcement of
creditors' rights or remedies in general from time to time in effect and
the exercise by courts of equity powers or their application of principles
of public policy.
(c) Accredited Investor. The Lender and each member of Lender is an
"accredited investor" as defined in Rule 501 (a) of Regulation D
promulgated under the 1933 Act.
18
19
ARTICLE VI
Covenants and Agreements
------------------------
6.1. Affirmative Covenants. So long as any Indebtedness remains
outstanding under this Agreement and the Notes, the Company covenants and agrees
that it will and will cause each Subsidiary to:
(a) Certain Information and SEC Reports. Furnish to Lender in form
and substance satisfactory to Lender:
(i) within five (5) days after the Company learns of the
commencement or overtly threatened commencement of any material
claim or suit, legal or equitable, or of any administrative,
arbitration, or other similar proceeding against the Company or any
of its Subsidiaries, or any of their respective businesses, assets,
or properties which claim or proceeding, if determined adversely to
the Company or such Subsidiary, would be likely to have a material
adverse effect on the Company and its Subsidiaries, taken as a
whole, written notice of the nature and extent of such suit or
proceeding or, as to each LLC individually;
(ii) within five (5) days after the Company learns of any
circumstance or event which reasonably can be expected to have a
material adverse effect on the assets, properties, liabilities,
financial condition, results of operations, business, or prospects
of the Company and its Subsidiaries taken as a whole, or, as to each
LLC individually, written notice of the nature and extent of such
circumstance or event;
(iii) simultaneous with the transmission thereof to Company's
shareholders, copies of (or notice from an ▇▇▇▇▇ watch service of)
all financial statements, proxy statements, reports and any other
general written communications which the Company sends to its
shareholders and copies (or notice from an ▇▇▇▇▇ watch service of)
of all registration statements and all regular, special or periodic
reports which it files with the SEC or with any securities exchange
on which any of its securities are then listed, and copies of all
press releases and other statements made available generally by the
Company to the public concerning material developments in the
Company's businesses; and
(vii) within ten (10) days after the Holder makes a reasonable
request therefor, such other data relating to the business, affairs
and financial condition of the Company or any of its Subsidiaries.
19
20
(b) Taxes. Pay and discharge all taxes and other governmental
charges before the same shall become overdue, unless and to the extent
only that such payment is being contested in good faith.
(c) Insurance. Maintain insurance coverage on its physical assets
and against other business risks in such amounts and of such types as are
customarily carried by companies similar in size and nature, and in the
event of acquisition of additional property, real or personal, or of
incurrence of additional risks of any nature, increase such insurance
coverage in such manner and to such extent as prudent business judgment
and present practice would dictate.
(d) Examination of Books. Permit the Lender, through its authorized
attorneys, accountants and representatives, to examine the Company's
books, accounts, records, ledgers and assets of every kind and description
at all reasonable times upon oral or written request of the Lender, at the
Company's cost and expense (provided that so long as the Company shall not
be in default, the Company shall be obligated to pay for no more than one
(1) such examination per year).
(e) Notification of Events of Default, Acceleration or Material
Adverse Effect. Promptly notify the Lender of any condition or event which
constitutes, or with the passage of time and/or the giving of notice would
constitute, an Event of Default under this Agreement or of any
acceleration of the maturity of any Indebtedness aggregating $5 million or
more of the Company, and promptly inform Lender of the existence or
occurrence of any condition or event (other than conditions having an
effect on the economy in general) which could reasonably be anticipated to
have a Material Adverse Effect upon the Company's financial condition.
(f) Maintenance of Licenses. Maintain in good standing all licenses
required by any Governmental Authority that may be necessary or required
for the Company and its Subsidiaries to carry on their respective
businesses, where the failure to maintain such licenses would have a
Material Adverse Effect on the Company and its Subsidiaries taken as a
whole (or, after the Second Disbursement Date, as to each LLC
individually).
(g) ERISA Compliance. Comply with all material requirements imposed
by ERISA as presently in effect or hereafter promulgated, including but
not limited to, the minimum funding requirements of any defined
contribution employee benefit plan ("Pension Plan").
(h) Compliance with Law. Comply in all material respects with all
applicable laws, rules, regulations and orders of any Governmental
Authority, such compliance to include, without limitation, paying before
the same become delinquent all taxes, assessments, and governmental
charges imposed upon it or upon its property, including without limitation
the Collateral Real Estate, except to the extent that compliance with any
of the foregoing is then being contested in good faith by appropriate
legal proceedings and with respect to which adequate financial reserves
have been established
20
21
on the books and records of the Company and except where the failure to
comply would not have a Material Adverse Effect on the Company and its
Subsidiaries, taken as a whole (or, as to each LLC individually).
(i) [INTENTIONALLY DELETED]
(j) Title Insurance. At the request of Lender, the Company shall
purchase mortgagee title insurance for the Lender pursuant to the
Additional Title Commitments furnished pursuant to this First Amended Loan
Agreement and to the Title Commitments furnished pursuant to the Original
Loan Agreement.
6.2. Negative Covenants. The Company covenants and agrees that so long as
any Indebtedness remains outstanding under this Agreement and the Notes, without
the prior written consent of Lender, Company will not:
(a) No Mergers, Etc. Enter into any merger or consolidation or sell,
lease, transfer or dispose of all, substantially all, or any material part
of its assets, except in the ordinary course of its business.
(b) Limitations on Indebtedness. Become or remain obligated, or
suffer or permit any Subsidiary to become or remain obligated, for any
Indebtedness, except:
(i) Indebtedness arising pursuant to this Agreement; and
(ii) other Indebtedness, whether now outstanding or hereafter
incurred, provided that the sum of all of the Indebtedness of the
Company and the Subsidiaries at any time outstanding on a
consolidated basis (excluding, however, any Indebtedness arising as
a result of acquisitions or business combinations effected after the
date of this Agreement) does not exceed the amount of Indebtedness
set forth in the Financial Model dated on or about April 24, 2000
delivered by the Company to Lender.
(c) Limitations on Mortgages. Create or permit to exist any Lien on
the Collateral Real Estate, other than Permitted Liens and mortgages in
favor of Lender.
ARTICLE VII
Miscellaneous
-------------
7.1. Waiver and Amendments. No failure or delay on the part of Lender in
the exercise of any power or right, and no course of dealing between Company and
Lender, shall operate as a waiver of such power or right, nor shall any single
or partial exercise of any power or right preclude other or further exercise
thereof or the exercise of any other power or right. Remedies provided for
herein are cumulative and not exclusive of any remedies which may be available
to the Lender at law or in equity. No notice to or demand on the Company
required hereunder or under the Notes
21
22
shall in any event entitle Company to any other or further notice or demand in
similar or other circumstances or constitute a waiver of the right of Lender to
any other or further action and any circumstances without notice or demand. No
amendment, modification or waiver of, or consent with respect to, any provision
of this Agreement or the Notes shall in any event be effective unless the same
shall be in writing and signed and delivered by Lender. Any waiver of any
provision of this Agreement or the Notes, and any consent to any departure by
Company from the terms of any provision of this Agreement or the Notes, shall be
effective only in the specific instance and for the specific purpose for which
given.
7.2. Notices. All notices and other communications required or permitted
under this Agreement shall be in writing and, if mailed by prepaid registered or
certified mail, return receipt requested, shall be deemed to have been received
on the earlier of the date shown on the receipt or three (3) Business Days after
the post-▇▇▇▇ date thereof. Notices may be given by recognized overnight courier
services and shall be deemed to have been received as of the regularly scheduled
time for delivery established by such courier service. In addition, notices
hereunder may be delivered by hand in which event the notice shall be deemed
effective when delivered or by telecopy in which case it shall be deemed
effective upon confirmation of transmission. All notices and other
communications under this Agreement shall be given to the parties hereto at the
following addresses:
If to Company:
--------------
Alterra Healthcare Corporation
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: President
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
With a copy to:
---------------
▇▇▇▇▇▇ & Hardin
2700 International Tower
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇.▇.
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇
Attn: ▇▇▇▇ ▇▇▇▇, Esq.
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
22
23
If to Lender:
-------------
RDVEPCO, L.L.C.
c/o RDV Corporation
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇.▇.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇, Treasurer
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
With a copy to:
---------------
EDP Management Company
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
and
▇▇▇▇▇ & ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇, ▇.▇., ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇, Esq.
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
Any party hereto may change the address to which notices shall be directed under
this Section by giving written notice of such change to the other parties.
7.3. Restriction on Transfer. The Lender acknowledges that the Notes have
not been registered under the Securities Act of 1933, as amended, (the "1933
Act") or the securities laws of any state. Accordingly, the Notes may not be
sold or otherwise disposed of or transferred, unless such sale, disposition or
transfer is registered under the 1933 Act and applicable state securities laws
or unless the Company has received an opinion of counsel reasonably acceptable
to the Company that such sale, disposition or transfer is exempt from such
registration. The Notes shall bear a restrictive legend to the foregoing effect.
7.4. Expenses. Company shall reimburse Lender for all of its reasonable
out-of-pocket expenses incurred in the negotiation, preparation, execution and
delivery of this Agreement, the Notes and other documents contemplated hereby
and all related due diligence, including, without limitation, the expenses of
legal counsel and accountants. Company shall also reimburse Holder for all of
its out-of-pocket expenses incurred in the administration, waiver, modification
and enforcement of any of its rights under this Agreement and the Notes,
including, without limitation, the reasonable expenses of legal counsel and
accountants. In addition, Company shall be
23
24
responsible for any documentary taxes, if any, incurred in connection with the
transactions contemplated by this Agreement and the Notes.
7.5. Severability. Any provision of this Agreement which is prohibited or
unenforceable in any jurisdiction, shall as to such jurisdiction, be ineffective
to the extent of such prohibition or unenforceability without invalidating the
remaining provisions hereof or affecting the validity or enforceability of such
provision in any other jurisdiction.
7.6. Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of Michigan without giving effect to any
choice or conflict of law provision or rule (whether of the State of Michigan or
any other jurisdiction) that would cause the application of the laws of any
jurisdiction other than the State of Michigan.
7.7. Successors and Assigns. This Agreement shall be binding upon Company
and Lender and their respective successors and assigns, and shall inure to the
benefit of Company and Lender and their successors and assigns.
7.8. Headings. Headings used in this Agreement are for convenience
only and shall not be used in connection with the interpretation of any
provision hereof.
7.9. Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original, but all such
separate counterparts shall together constitute one and the same instrument.
* * * * * * * * * * * * *
24
25
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by the undersigned thereunto duly authorized as of the date first
written above.
THE COMPANY:
ALTERRA HEALTHCARE CORPORATION
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
-----------------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: President
25
26
LENDER:
RDVEPCO, L.L.C.
By: RDV Altco, L.L.C.,
a member
By: EDP Assisted Living Properties,
L.L.C., a member
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
-----------------------------
Its: Authorized Agent
-----------------------------
26
27
Exhibit A
---------
First Additional Collateral Real Estate
1. Corona, CA
2. Leawood, KS
3. Topeka, KS
4. Lynchburg, VA
5. Lebanon I, TN [RELEASED]
6. Lebanon II, TN [RELEASED]
28
Exhibit B
---------
Second Additional Collateral Real Estate
To Be Developed:
----------------
1. W. Melbourne, FL
2. Valley Station, KY
3. Kenosha, WI
4. New Castle, DE
5. Frederick, MD
6. Irving Valley Ranch, TX
7. Ft. Wayne-Dupont, IN
Not to Be Developed:
--------------------
8. Gloucester, NJ
9. ▇▇▇▇▇▇▇▇, NJ
10. Murfreesboro, TN
11. Greenwood, IN
Danville, VA
29
Exhibit C
---------
Original Collateral Real Estate
1. Temecula, CA
2. Novato, CA
3. Apple Valley, CA
4. Moorpark, CA
5. Palmdale, CA
6. Arvada I, CA
7. Goldsboro, NC
8. ▇▇▇▇▇▇▇▇▇▇, ▇▇
▇. ▇▇▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇
10. ▇▇▇▇▇▇▇▇▇, NV
11. ▇▇▇▇▇▇▇, TN
12. Chesapeake, VA
13. Centerville, GA
14. Columbus, GA
15. Valdosta, GA
16. Holt, MI
17. Tulsa, OK
18. Easley, SC
19. Sumter, SC
30
Exhibit D
Mechanic's and Materialmen's Liens
LIEN FILED BY SITE LOCATION DATE FILED AMOUNT STATUS
Phase One Electric, Inc.* Fort ▇▇▇▇▇, IN 2/14/00 $54,402.30* Lien Filed
▇.▇. ▇▇▇▇▇▇▇ Construction, Fort ▇▇▇▇▇, IN 2/28/00 $67,257.00 Lien Filed
Inc.
Continuing Care Concepts, Inc. Gloucester, NJ 3/24/00 $269,808.50 Lien Filed
Continuing Care Concepts, Inc. Gloucester, NJ 3/24/00 $275,407.50 Lien Filed
Continuing Care Concepts, Inc. ▇▇▇▇▇▇▇▇, NJ 3/24/00 $258,871.00 Lien Filed
American Automatic Sprinkler, Irving-Valley 1/24/00 $37,468.90 Lien Filed
Inc. Ranch, TX
▇▇▇▇▇▇▇▇▇ Roofing Company, Irving-Valley 2/10/00 $34,967.70 Threatened
Inc. Ranch, TX
Dynaten Corporation Irving-Valley 1/14/00 $55,602.00 Threatened
Ranch, TX
▇▇▇▇▇▇▇-▇▇▇▇▇▇▇▇ Electrical Irving-Valley 2/29/00 $40,288.00 Lien Filed
Contractors Ranch, TX
Ike Painting Irving-Valley 1/13/00 $15,968.61 Threatened
Ranch, TX
Wickes Direct Irving-Valley 3/24/00 $15,042.52 Lien Filed
Ranch, TX
▇▇▇▇▇▇ Brothers Construction Melbourne, FL 1/13/00 $14,848.00 Threatened
Continuing Care Concepts, Inc. New Castle, DE 3/29/00 $804,598.05 Civil
Summons
American Builders & Valley Station, KY 2/22/00 $77,096.31 Lien Filed
Contractors Supply Co.
▇▇▇▇▇▇▇ Construction Inc. Valley Station, KY ______ $40,333.39 Lien Filed
Frontier Enterprises, Inc. Valley Station, KY 9/23/99 $43,810.07 Lien Filed
Kentucky-Indiana Lumber Co., Valley Station, KY 9/28/99 $233,318.89 Lien Filed
Inc.
KFP, Inc. d/b/A Big Lumber Co Valley Station, KY 12/31/99 $24,275.36 Lien Filed
Plumbers Supply Co. Valley Station, KY 1/24/00 $83,708.95 Lien Filed
TJ Excavating Valley Station, KY 2/29/00 $7,014.00 Threatened
▇▇▇▇▇▇▇ Construction Valley Station, KY 2/02/00 $96,104.42 Lien Filed
▇▇▇▇▇▇▇▇, Inc. Valley Station, KY 1/5/00 $45,634.00 Threatened
(CBC)
Grinned, Inc. Valley Station, KY 1/5/00 $15,079.00 Threatened
(SH)
▇▇▇▇▇▇ Supply, Inc. West Melbourne, FL 3/16/00 $1,344.28 Lien Filed
▇▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇. ▇▇▇▇ Melbourne, FL 2/24/00 $44,397.91 Lien Filed
▇. ▇▇▇▇▇▇▇▇▇ Excavating, Inc. West Melbourne, FL _____ $________ Lien Filed
* This Lien has been paid in full. The Company is awaiting receipt of an
executed lien release, which release shall be filed or record.
31
Exhibit E
---------
The LLCs
1. Clare Bridge of West Melbourne LLC
2. Clare Bridge Cottage of Valley Station LLC
3. Clare Bridge of Kenosha LLC
4. Clare Bridge of New Castle LLC
5. Clare Bridge of ▇▇▇▇▇▇▇▇▇ LLC
6. Clare Bridge of Irving Valley LLC
7. Clare Bridge of Fort ▇▇▇▇▇ LLC
8. Clare Bridge Cottage of Gloucester LLC
9. Wynwood of ▇▇▇▇▇▇▇▇ LLC
10. Clare Bridge Cottage of Greenwood LLC
32
Exhibit F
---------
$34 Million Note
THIS NOTE HAS NOT BEEN REGISTERED PURSUANT TO THE SECURITIES ACT OF 1933 OR ANY
STATE SECURITIES LAW. NEITHER THIS NOTE NOR ANY PORTION HEREOF OR INTEREST
HEREIN MAY BE SOLD, ASSIGNED, TRANSFERRED, PLEDGED OR OTHERWISE DISPOSED OF
UNLESS THE SAME IS REGISTERED UNDER SAID ACT AND ANY APPLICABLE STATE SECURITIES
LAW, OR UNLESS AN EXEMPTION FROM SUCH REGISTRATION IS AVAILABLE AND THE COMPANY
SHALL HAVE RECEIVED, AT THE EXPENSE OF THE HOLDER HEREOF, EVIDENCE OF SUCH
EXEMPTION REASONABLY SATISFACTORY TO THE COMPANY (WHICH MAY INCLUDE, AMONG OTHER
THINGS, AN OPINION OF COUNSEL SATISFACTORY TO THE COMPANY).
AMENDED AND RESTATED PROMISSORY NOTE
------------------------------------
$34,000,000.00 Atlanta, Georgia
April 26, 2000
WHEREAS, ALTERRA HEALTHCARE CORPORATION, a Delaware corporation (the
"Company") previously executed and delivered that certain Promissory Note dated
February 3, 2000, in the amount of $34,000,000.00 to Lender (the "Original
Note") with respect to a loan made pursuant to that certain Amended and Restated
Loan Agreement between Company and Lender of even date therewith;
WHEREAS, the Company and Lender are entering into a Second Amended and
Restated Loan Agreement of even date herewith (the "Second Amended Loan
Agreement") whereby the parties have agreed, among other things, to amend the
maturity date of the Original Note; and
WHEREAS, as a condition of the Second Amended Loan Agreement, the Company
has agreed to execute and deliver this Amended and Restated Promissory Note in
substitution for the Original Note and by acceptance hereof Lender agrees to
return the Original Note marked "cancelled" to the Company.
IN CONSIDERATION OF THE FOREGOING, AND FOR VALUE RECEIVED, the Company
promises to pay to the order of RDVEPCO, L.L.C., a Michigan limited liability
company (the "Lender"), c/o RDV Corporation, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attn: President, or such other place as
designated in writing by the Holder, the principal sum of Thirty Four Million
and No/100 Dollars ($34,000,000.00) together with interest on the principal
balance outstanding from time to time in accordance with the provisions of this
Note. This Note has been executed and delivered pursuant to the Second Amended
Loan Agreement, the terms and conditions of which are incorporated herein by
reference.
33
Unless otherwise indicated herein, capitalized terms used in this Note have the
same meanings set forth in the Second Amended Loan Agreement.
1. Interest Rate; Payment; Usury.
------------------------------
(a) Provided that no Event of Default has occurred and is continuing
and subject to the other provisions of this Note, interest shall accrue
under this Note from the date of the last payment under the Original Note
through the date of this Note and continuing through the date on which all
outstanding principal and accrued and unpaid interest on this Note have
been paid in full. The principal amount outstanding from time to time
under this Note shall bear interest at the rate of ten percent (10%) per
annum. During any period that an Event of Default shall have occurred and
be continuing, interest on this Note shall accrue at a rate equal to
fifteen percent per annum (15%) (the "Default Interest Rate").
Notwithstanding anything contained herein to the contrary, in no event
shall the interest rate on this Note, including the Default Interest Rate,
exceed the highest rate permitted by applicable law. Interest on this Note
shall be based on a 360 day year and interest shall accrue and be payable
for the actual number of calendar days elapsed. Interest shall be payable
monthly in arrears beginning on April 30, 2000 and on the last day of each
month thereafter until the principal and all accrued interest on this Note
have been paid in full.
(b) It is the intention of the Company and Lender to conform
strictly to applicable usury laws now or hereafter in force, and any
interest payable under the Second Amended Loan Agreement or this Note
shall be subject to reduction to an amount not to exceed the maximum
non-usurious amount for commercial loans allowed under such applicable
usury laws as now or hereafter construed by the courts having jurisdiction
over such matters. In the event such interest (whether designated as
interest, service charges, points, or otherwise) does exceed the maximum
legal rate, it shall be (i) canceled automatically to the extent that such
interest exceeds the maximum legal rate; (ii) if already paid, at the
option of the Holder, either be rebated to the Company or credited on the
principal amount of this Note; or (iii) if this Note has been prepaid in
full, then such excess shall be rebated to the Company. It is further
agreed, without limitation of the foregoing, that all calculations of the
rate of interest contracted for, charged, or received under the Second
Amended Loan Agreement and this Note that are made for the purpose of
determining whether such rate exceeds the maximum legal rate, shall be
made, to the extent permitted by applicable law, by amortizing, prorating,
allocating, and spreading throughout the full stated term of this Note
(and any extensions of the term thereof that may be hereafter granted) all
such interest at any time contracted for, charged, or received from the
Company or otherwise by the Holder so that the rate of interest on account
of this Note, as so calculated is uniform throughout the term hereof. If
the Company is exempt or hereafter becomes exempt from applicable usury
statutes or for any other reason the rate of interest to be charged on the
this Note is not limited by law, none of the provisions of this paragraph
2
34
shall be construed so as to limit or reduce the interest or other
consideration payable under the Second Amended Loan Agreement or this Note
or under the instruments securing payment thereof. The terms and
provisions of this paragraph shall control and supersede every other
provision of all agreements between the Company and the Lender.
2. Maturity. Unless the same shall become due earlier as a result of
acceleration of the maturity, this Note shall mature on the earlier of (i) the
Initial Closing (as such term is defined in the Purchase Agreement) of the
Alterra Equity Transaction, or (ii) the Initial Closing of a Financing Proposal
that is a Superior Proposal (as such terms are defined in the Purchase
Agreement), or (iii) February 2, 2001. Upon the earlier to occur of the
foregoing, the outstanding principal balance of this Note and all accrued and
unpaid interest shall become due and payable.
3. Prepayments. The Company may from time to time prepay this Note, in
whole or in part, at any time. Any partial prepayment shall be applied first to
interest which is accrued and unpaid and then to principal.
4. Manner of Payment. The Company shall make payments in respect of this
Note (including principal and interest) by wire transfer of immediately
available funds to the account specified by the Holder.
5. Events of Default; Acceleration. The maturity of this Note is subject
to acceleration if an Event of Default occurs and is continuing as set forth in
the Second Amended Loan Agreement.
6. Collection Expenses. In the event Company fails to pay any installment
of interest or principal when due, Company shall pay to the Holder, in addition
to the amounts due, all costs of collection, including reasonable attorneys'
fees.
7. Company Waivers. Company, for itself and its successors and assigns,
hereby waives demand, presentment, protest, diligence, notice of dishonor and
any other formality in connection with this Note and expressly agrees that this
Note, or any payment hereunder, may be extended from time to time and that the
Holder may accept security for this Note or release security for this Note, all
without in any way affecting the liability of Company hereunder.
8. Governing Law. All questions concerning the construction, validity and
interpretation of this Note shall be governed by and construed in accordance
with the domestic laws of the State of Michigan, without giving effect to any
choice of law or conflict of law provision or rule (whether of the State of
Michigan or any other jurisdiction) that would cause the application of the laws
of any jurisdiction other than the State of Michigan.
9. Amendment and Waiver. The provisions of this Note may be amended and
waived only with the prior written consent of the Company and the Holder.
3
35
IN WITNESS WHEREOF, the Company has executed this Note on the date first
written above.
ALTERRA HEALTHCARE CORPORATION
By:
----------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: President
4
36
Exhibit G
---------
$25 Million Note
THIS NOTE HAS NOT BEEN REGISTERED PURSUANT TO THE SECURITIES ACT OF 1933 OR ANY
STATE SECURITIES LAW. NEITHER THIS NOTE NOR ANY PORTION HEREOF OR INTEREST
HEREIN MAY BE SOLD, ASSIGNED, TRANSFERRED, PLEDGED OR OTHERWISE DISPOSED OF
UNLESS THE SAME IS REGISTERED UNDER SAID ACT AND ANY APPLICABLE STATE SECURITIES
LAW, OR UNLESS AN EXEMPTION FROM SUCH REGISTRATION IS AVAILABLE AND THE COMPANY
SHALL HAVE RECEIVED, AT THE EXPENSE OF THE HOLDER HEREOF, EVIDENCE OF SUCH
EXEMPTION REASONABLY SATISFACTORY TO THE COMPANY (WHICH MAY INCLUDE, AMONG OTHER
THINGS, AN OPINION OF COUNSEL SATISFACTORY TO THE COMPANY).
PROMISSORY NOTE
---------------
$25,000,000.00 Atlanta, Georgia
April 26, 2000
FOR VALUE RECEIVED, ALTERRA HEALTHCARE CORPORATION, a Delaware corporation
("Company"), promises to pay to the order of RDVEPCO, L.L.C., a Michigan limited
liability company (the "Lender"), c/o RDV Corporation, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇
▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attn: President, or such
other place as designated in writing by the Holder, the principal sum of Twenty
Five Million and No/100 Dollars ($25,000,000.00) together with interest on the
principal balance outstanding from time to time in accordance with the
provisions of this Note. This Note has been executed and delivered pursuant to
that certain Second Amended and Restated Second Amended Loan Agreement between
the Company and the Lender dated of even date herewith (the "Second Amended Loan
Agreement"), the terms and conditions of which are incorporated herein by
reference. Unless otherwise indicated herein, capitalized terms used in this
Note have the same meanings set forth in the Second Amended Loan Agreement.
1. Interest Rate; Payment; Usury.
(a) Provided that no Event of Default has occurred and is continuing
and subject to the other provisions of this Note, during the period
commencing on the date of funding hereunder through, but not including,
the date on which all outstanding principal and accrued and unpaid
interest on this Note have been paid in full, the principal amount
37
outstanding from time to time under this Note shall bear interest at the
rate of ten percent (10%) per annum. During any period that an Event of
Default shall have occurred and be continuing, interest on this Note shall
accrue at a rate equal to fifteen percent per annum (15%) (the "Default
Interest Rate"). Notwithstanding anything contained herein to the
contrary, in no event shall the interest rate on this Note, including the
Default Interest Rate, exceed the highest rate permitted by applicable
law. Interest on this Note shall be based on a 360 day year and interest
shall accrue and be payable for the actual number of calendar days
elapsed. Interest shall be payable monthly in arrears beginning on April
30, 2000 and on the last day of each month thereafter until the principal
and all accrued interest on this Note have been paid in full.
(b) It is the intention of the Company and Lender to conform
strictly to applicable usury laws now or hereafter in force, and any
interest payable under the Loan Agreement or this Note shall be subject to
reduction to an amount not to exceed the maximum non-usurious amount for
commercial loans allowed under such applicable usury laws as now or
hereafter construed by the courts having jurisdiction over such matters.
In the event such interest (whether designated as interest, service
charges, points, or otherwise) does exceed the maximum legal rate, it
shall be: (i) canceled automatically to the extent that such interest
exceeds the maximum legal rate; (ii) if already paid, at the option of the
Holder, either be rebated to the Company or credited on the principal
amount of this Note; or (iii) if this Note has been prepaid in full, then
such excess shall be rebated to the Company. It is further agreed, without
limitation of the foregoing, that all calculations of the rate of interest
contracted for, charged, or received under the Loan Agreement and this
Note that are made for the purpose of determining whether such rate
exceeds the maximum legal rate, shall be made, to the extent permitted by
applicable law, by amortizing, prorating, allocating, and spreading
throughout the full stated term of this Note (and any extensions of the
term thereof that may be hereafter granted) all such interest at any time
contracted for, charged, or received from the Company or otherwise by the
Holder so that the rate of interest on account of this Note, as so
calculated is uniform throughout the term hereof. If the Company is exempt
or hereafter becomes exempt from applicable usury statutes or for any
other reason the rate of interest to be charged on the this Note is not
limited by law, none of the provisions of this paragraph shall be
construed so as to limit or reduce the interest or other consideration
payable under the Second Amended Loan Agreement or this Note or under the
instruments securing payment thereof. The terms and provisions of this
paragraph shall control and supersede every other provision of all
agreements between the Company and the Lender.
2. Maturity. Unless the same shall become due earlier as a result of
acceleration of the maturity, this Note shall mature on the earlier of (i) the
Closing (as such term is defined in the Purchase Agreement) of an Alterra Equity
Transaction, or (ii) the Initial Closing of a Financing Proposal that is a
Superior Proposal (as such terms are defined in the Purchase Agreement), or
(iii) June 30, 2000. Upon the earlier to occur of the foregoing, the outstanding
principal balance of this Note and all accrued and unpaid interest shall become
due and payable.
2
38
3. Prepayments. The Company may from time to time prepay this Note, in
whole or in part, at any time. Any partial prepayment shall be applied first to
interest which is accrued and unpaid and then to principal.
4. Manner of Payment. The Company shall make payments in respect of this
Note (including principal and interest) by wire transfer of immediately
available funds to the account specified by the Holder.
5. Events of Default; Acceleration. The maturity of this Note is subject
to acceleration if an Event of Default occurs and is continuing as set forth in
the Second Amended Loan Agreement.
6. Collection Expenses. In the event Company fails to pay any installment
of interest or principal when due, Company shall pay to the Holder, in addition
to the amounts due, all costs of collection, including reasonable attorneys'
fees.
7. Company Waivers. Company, for itself and its successors and assigns,
hereby waives demand, presentment, protest, diligence, notice of dishonor and
any other formality in connection with this Note and expressly agrees that this
Note, or any payment hereunder, may be extended from time to time and that the
Holder may accept security for this Note or release security for this Note, all
without in any way affecting the liability of Company hereunder.
8. Governing Law. All questions concerning the construction, validity and
interpretation of this Note shall be governed by and construed in accordance
with the domestic laws of the State of Michigan, without giving effect to any
choice of law or conflict of law provision or rule (whether of the State of
Michigan or any other jurisdiction) that would cause the application of the laws
of any jurisdiction other than the State of Michigan.
9. Amendment and Waiver. The provisions of this Note may be amended and
waived only with the prior written consent of the Company and the Holder.
3
39
IN WITNESS WHEREOF, the Company has executed this Note on the date first
written above.
ALTERRA HEALTHCARE CORPORATION
By:
----------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: President
40
Schedule 3.3
RELEASE PRICES FOR FIRST ADDITIONAL
-----------------------------------
COLLATERAL REAL ESTATE
----------------------
CONSTRUCTION % TOTAL RELEASE
FACILITIES COSTS VALUE PRICES
Corona, CA 5,200,000 0.286216 4,672,105.78
Topeka, KS 3,931,257 0.216383 3,532,172.43
Leawood, KS 4,657,830 0.256374 4,184,973.75
Lynchburg, VA 4,378,995 0.241027 3,934,453.84
18,168,082 1.0 16,323,705.80*
* $16,323,705.80 is the current principal balance of the $20 million additional
loan advanced pursuant to the First Amended Loan Agreement.
41
Schedule 5.1 (a)
----------------
Capitalization of Holding
Holding Shares
------- ------
Authorized Issued
---------- ------
Common Stock, $0.01 par value 2,857 1,857
Convertible Preferred Stock, $0.01 par value 1,000 1,000
42
Schedule 5.1 (b)
----------------
NONE
7
43
Schedule 5.1 (c)
----------------
NONE
8