FIFTH AMENDMENT TO LOAN AGREEMENT AND DOCUMENTS
THIS FIFTH AMENDMENT TO LOAN AGREEMENT AND DOCUMENTS, dated as of
December 21, 1998 (this "Amendment"), is entered into by and between BROOKDALE
LIVING COMMUNITIES, INC., a Delaware corporation (the "Borrower"), and LaSALLE
NATIONAL BANK, a national banking association (the "Bank").
WITNESSETH
WHEREAS, Borrower has previously executed and delivered to the Bank a
certain Note dated April 27, 1998 in the original principal amount of up to
Fifteen Million Dollars ($15,000,000.00) (the "Original Note") evidencing a
certain loan (the "Loan") set forth more fully in and governed by a certain Loan
Agreement of that same date to which the Bank is also a party (the "Original
Loan Agreement");
WHEREAS, the Loan was subsequently modified and amended by Borrower's
execution and delivery to the Bank of a certain Amended and Restated Note dated
July 16, 1998 increasing the principal amount of the Loan by $10,000,000.00, on
an interim basis only, from $15,000,000.00 to $25,000,000.00 (the "Amended and
Restated Note") and a certain First Amendment to Loan Agreement and Documents of
that same date to which the Bank is also a party (the "First Amendment") that
(a) increased the principal amount of the Loan on an interim basis as aforesaid
and (b) permitted a portion of the Loan to be reserved for the issuance of
standby Letters of Credit by the Bank to and for the benefit of municipalities
and other governmental units in connection with projects developed by Borrower
from time to time as set forth more fully therein;
WHEREAS, the Loan was subsequently modified and amended by Borrower's
execution and delivery to the Bank of a certain Second Amendment to Loan
Agreement and Documents dated October 14, 1998 to which the Bank is also a party
(the "Second Amendment") wherein (a) the Bank consented to the Borrower's
proposed issuance of a convertible subordinated and unsecured note to OZ Master
Fund, Ltd. in the principal amount of Ten Million Dollars ($10,000,000.00), (b)
the Bank permitted the Borrower to guarantee financing from other financial
institutions to certain Subsidiaries of Borrower in connection with certain
development projects located in ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ (▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇), ▇▇▇▇
Ellyn, Illinois and Raleigh, North Carolina, which projects were to be
originally financed by Nomura Asset Capital Corporation, (c) the Event of
Default set forth in Section 7.01(O) of the Loan Agreement was modified and
restructured, and (d) the Interim Maturity Date was extended to November 3,
1998;
WHEREAS, the Loan was subsequently modified and amended by Borrower's
execution and delivery to the Bank of a certain Third Amendment to Loan
Agreement and Documents dated October 20, 1998 to which the Bank is also a party
(the "Third Amendment") wherein (a) the Maximum Revolving Loan Commitment was
frozen at $24,953,750.00, (b) the "Interim Maturity Date" was extended to
November 3, 1998, (c) it was agreed that, on the Interim Maturity Date (x) the
outstanding principal balance of the Loan was to be reduced to $10,000,000.00,
and (y) the principal amount of the Loan and Maximum Revolving Loan Commitment
were to be decreased from $25,000,000.00 to an amount not to exceed
$10,000,000.00, (d) the Interim Interest Rate and the Revised Default Rate were
adjusted, and (e) certain additional changes to the Maximum Revolving Loan
Commitment were mandated based upon the Stock Price of the Company from time to
time, all of the foregoing as set forth more fully in and subject to the terms
and conditions of the Third Amendment;
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WHEREAS, the Loan was subsequently modified and amended by Borrower's
execution and delivery to the Bank of a certain Fourth Amendment to Loan
Agreement and Documents dated November 3, 1998 to which the Bank is also a party
(the "Fourth Amendment") wherein (a) the "Interim Maturity Date" was extended to
a date certain which was the first to occur of (x) the earlier of November 30,
1998, or (y) the date on which Borrower closed on the "Offering," and (b) it was
agreed that, on the Interim Maturity Date (x) the outstanding principal balance
of the Loan was to be reduced to zero ($0.00) provided that the Offering had
closed, (y) the outstanding principal balance of the Loan was to be reduced to
$10,000,000.00 regardless of whether the Offering had closed, and (z) the
principal amount of the Loan and Maximum Revolving Loan Commitment were to be
decreased from $25,000,000.00 to an amount not to exceed $10,000,000.00
regardless of whether the Offering had closed, all of the foregoing as set forth
more fully in and subject to the terms and conditions of the Fourth Amendment
(the Original Loan Agreement, as amended by the First Amendment, the Second
Amendment, the Third Amendment, and the Fourth Amendment is herein referred to
as the "Loan Agreement");
WHEREAS, subject to the terms and conditions of this Amendment,
Borrower has requested the Bank to increase the principal amount of the Loan and
of the Maximum Revolving Loan Commitment by $5,000,000.00 from $10,000,000.00 to
$15,000,000.00, to which the Bank is willing to agree subject to the terms and
conditions set forth herein;
NOW, THEREFORE, in consideration of the premises, the covenants and
agreements herein contained, and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties hereby
agree as follows:
1. Incorporation of Recitals. The above and foregoing recitals are
incorporated into and made a part of this Amendment. All capitalized terms used
herein, if not otherwise specifically defined, shall have the meanings and
definitions prescribed in the Loan Agreement and the Documents referred to
therein.
2. Increased Loan Commitment. As of the date of this Amendment, the
Loan Agreement and the Documents are hereby amended to increase the principal
amount of the Loan and the Maximum Revolving Loan Commitment from $10,000,000.00
to $15,000,000.00.
3. Interest Rate. Except as provided in Section 2.03 of the Loan
Agreement, Loan Advances under the Loan Commitment shall bear interest at the
Prime Rate plus one-half of one percent (0.50%) per annum. The Interim Interest
Rate is no longer applicable and accordingly, all references to Interim Interest
Rate in the Loan Agreement are hereby deleted.
4. Execution Note. Contemporaneous with the execution of this
Agreement, the Borrower has executed and delivered Third Amended and Restated
Note in the principal sum of up to $15,000,000.00 evidencing the Loan as amended
by this Amendment, which Third Amended and Restated Note shall replace and
supersede the Second Amended and Restated Note.
5. Maturity Date. The definition of Maturity Date in the Loan Agreement
is confirmed and defined to be April 26, 1999. All outstanding Loan Advances
together with any accrued but unpaid interest thereon and any other costs or
amounts owed to the Bank hereunder shall be due and paid in full on the Maturity
Date.
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6. Default Rate. Any Obligation of the Borrower under the Loan
Agreement or any of the other Documents which is not paid when due, whether at
stated maturity, by acceleration or otherwise, shall, without notice, bear
interest payable on demand at the interest rate then in effect with respect
thereto plus three percent (3%). In addition, after the occurrence of any other
Event of Default and delivery to the Borrower of the Bank's notice to charge
post-default interest, all Obligations of the Borrowers hereunder shall bear
interest at the rate provided for in the immediately preceding sentence.
7. Reaffirmation. To the extent any term(s) or condition(s) in the Loan
Agreement or any of the Documents shall contradict or be in conflict with the
amended terms of the Loan as set forth herein, such terms and conditions are
hereby deemed modified and amended accordingly, upon the effective date hereof,
to reflect the terms of the Loan as so amended herein. All terms of the Loan
Agreement and the Documents, as amended hereby, shall be and remain in full
force and effect and shall constitute the legal, valid, binding and enforceable
obligations of Borrower to the Bank. As of the date of this Amendment, Borrower
herein restates, ratifies and reaffirms each and every term and condition set
forth in the Loan Agreement and the Documents as amended herein. There are no
other changes to the Documents, including without limitation the Loan Agreement,
except for the changes specifically set forth herein.
8. No Waiver. No failure or delay on the part of the Bank in exercising
any right, power or remedy hereunder or under any other Documents shall operate
as a waiver thereof, nor shall any single or partial exercise of any such right,
power or remedy preclude any other or further exercise thereof or the exercise
of any other right, power or remedy hereunder or under any other Document. The
remedies herein provided and under any other Document are cumulative and not
exclusive of any remedies provided by law.
9. Certification. To further induce the Bank to enter into this
Amendment, Borrower represents and warrants to the Bank as follows: (a) Borrower
is empowered to perform all acts and things undertaken and done pursuant to this
Amendment and has taken all corporate or other action necessary to authorize the
execution, delivery and performance of the of this Amendment; (b) the officers
of Borrower executing this Amendment have been duly elected or appointed and
have been fully authorized to execute the same at the time executed; (c) this
Amendment, when executed and delivered, will be the legal, valid and binding
obligation of Borrower, enforceable against it in accordance with its respective
terms; and (d) Borrower is delivering to the Bank contemporaneously herewith, a
certificate of Borrower's Secretary certifying as to the resolutions of the
Executive Committee of Borrower's Board of Directors approving this Amendment
and the incumbency and signatures of the officers of Borrower signing this
Amendment.
10. Absence Of Claim. To further induce the Bank to enter into this
Amendment, Borrower hereby acknowledges and agrees that, as of the date hereof,
there exists no right of offset, defense, counterclaim or objection in favor of
Borrower as against the Bank with respect to the Obligations to the Bank.
11. Illinois Law To Govern. This Amendment and each transaction
contemplated hereunder shall be deemed to be made under and shall be construed
and interpreted in accordance with the laws of the State of Illinois.
12. Binding Effect. The terms, provisions and conditions of this
Amendment shall be binding upon and inure to the benefit of each respective
party and their respective legal representatives, successors and assigns.
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IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
executed by their respective officers thereunto duly authorized, as of the date
first above written.
BORROWER:
BROOKDALE LIVING COMMUNITIES, INC.
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, ▇▇.
Print Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, ▇▇.
Title: Executive Vice President
ATTEST:
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Print Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Secretary
BANK:
LaSALLE NATIONAL BANK
By: /s/ ▇▇▇ ▇. ▇'▇▇▇▇▇▇▇▇▇▇▇
Print Name: ▇▇▇ ▇. ▇'▇▇▇▇▇▇▇▇▇▇▇
Title: Assistant Vice President
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