NINTH AMENDMENT TO CREDIT
AGREEMENT
THIS NINTH
AMENDMENT TO CREDIT AGREEMENT (this “Agreement”) is
dated to be effective as of the 1st day of October, 2008
(“Effective Date”) by and between BANK OF AMERICA,
N.A., a national banking association, in its capacity as
administrative agent (the “Administrative Agent”) for
the “Lenders” that are parties to the “Credit
Agreement” (as defined below; terms defined in the Credit
Agreement shall have the same meanings in this Agreement) and in
its capacity as Swingline Lender and L/C Issuer; each of the
undersigned Lenders; SUNRISE SENIOR LIVING, INC., a Delaware
corporation (the “Borrower”); and each of the
undersigned Guarantors. Hereafter, the Borrower and the Guarantors
are collectively referred to as the “Obligors”; and the
Administrative Agent, the Lenders, the Swingline Lender and the L/C
Issuer are collectively referred to as the “Credit
Parties.”
The Obligors are
parties with the Credit Parties to a Credit Agreement dated
December 2, 2005 as amended by the First Amendment To Credit
Agreement dated March 6, 2006, the Second Amendment To Credit
Agreement dated January 31, 2007, the Third Amendment To
Credit Agreement dated June 27, 2001, the Fourth Amendment To
Credit Agreement dated September 17, 2007, the Fifth Amendment
To Credit Agreement dated January 31, 2008, the Sixth
Amendment To Credit Agreement dated February 19, 2008, the
Seventh Amendment To Credit Agreement dated March 13, 2008,
and the Eighth Amendment To Credit Agreement dated July 23,
2008 (collectively, as amended by this Agreement, and as further
amended, modified, substituted, extended and renewed from time to
time, the “Credit Agreement”).
The Obligors have
requested the Credit Parties agree to: (a) waive the
non-compliance of the Borrower with the financial covenant set
forth in Section 7.14.(a) (Consolidated Net Worth) of the
Credit Agreement for the fiscal quarter ending September 30,
2008; and (b) make the other changes to the terms of the
Credit Agreement as are more particularly set forth
herein.
The undersigned
Credit Parties and the Obligors have entered into this Agreement to
provide for
the requested waiver and changes.
NOW, THEREFORE, in
consideration of the premises, the mutual agreements herein
contained, and other good and valuable consideration, the receipt
and sufficiency of which are hereby acknowledged, the parties
hereby agree as follows:
Section 1.
Acknowledgment Of Obligations; Reaffirmation Of Obligations
. The Obligors acknowledge that: (a) each of the Loan
Documents is the valid and binding obligation of each of the
Obligors that is a signatory thereto; (b) the Loan Documents
are enforceable in accordance with all stated terms; and
(c) the Obligors have no defenses, claims of offset, or
counterclaims against the enforcement of the Loan Documents in
accordance with all stated terms. Each Obligor hereby reaffirms and
ratifies all of its respective duties and obligations under the
Loan Documents to which it is a party.
Section 2.
Waiver . Subject to the compliance by the Obligors with
their covenants and agreements set forth in this Agreement, the
undersigned Credit Parties hereby waive the noncompliance of the
Borrower with the financial covenant set forth in
Section 7.14.(a) (Consolidated Net Worth) of the Credit
Agreement for the fiscal quarter ending September 30,
2008.
Section 3.
Amendment And Modification Of Credit Agreement . The Credit
Agreement is hereby amended and modified as of the Effective Date
as follows:
Section 3.1.
Amendment of Definition of “Applicable Rate” .
The existing definition of “Applicable Rate” is hereby
deleted in its entirety and replaced with the following
definition:
“Applicable
Rate” means three hundred seventy-five (375) basis
points for Eurodollar Rate Loans and two hundred twenty-five
(225) basis points for Base Rate Loans.”
Section 3.2.
Amendment to Section 2.8.(a) of Credit Agreement . The
following sentence shall be added to the end of
Section 2.8.(a):
“Notwithstanding anything to the contrary
in this Agreement, the minimum rate upon which interest may accrue
upon any of the Loans at any time shall not be less than five
percent (5%) per annum.”
Section 3.3.
Amendment of Section 3.3 of Credit Agreement . The
following subsection (d) shall be added to the first sentence
of Section 3.3 of the Credit Agreement:
”;
... or (d) the Base Rate is less than the BBA
LIBOR.”
Section 4.
Waiver And Amendment Fee . The Borrower shall pay upon its
execution and delivery of this Agreement to the Administrative
Agent for the accounts of each Lender that executes this Agreement,
in accordance with its respective Applicable Percentage, a waiver
and amendment fee in the aggregate amount of Two Hundred Thousand
Dollars ($200,000.00).
Section 5.
Obligors’ Representations And Warranties . As an
inducement to the Credit Parties to enter into this Agreement and
to agree to the requested waiver and to the modifications provided
for herein, each of the Obligors makes the following
representations and warranties to the Credit Parties and
acknowledges the justifiable reliance of the Credit Parties
thereon:
Section 5.1.
Authority And Good Standing . Each Obligor: (a) has the
power to enter into this Agreement and any related documents and to
perform all of its obligations hereunder and thereunder;
(b) has duly authorized the entry into and performance of this
Agreement and all related documents; and (c) is in good
standing in the state of its organization and is qualified to do
business and is in good standing in all other states in which it
transacts business.
Section 5.2.
No Violations . The execution, delivery, and performance of
this Agreement by the Obligors will not immediately, or with the
passage of time, the giving of notice, or both: (a) violate any
laws or result in a default under any contract, agreement, or
instrument to which any Obligor is a party or by which any Obligor
or any properties of any Obligor are bound; or (b) result in the
creation or imposition of any security interest in, or lien or
encumbrance upon, any of the assets of the Obligors.
Section 5.3.
Accuracy Of Information . All information and data submitted
by or on behalf of the Obligors in connection with this Agreement
and the transactions contemplated herein, is true, accurate and
complete in all material respects as of the date made and contains
no knowingly false, incomplete or misleading statements.
2
Section 5.4.
Pending Proceedings . There are no actions, suits or
proceedings pending against any of the Obligors, the adverse
determination of which would be likely to have a Material Adverse
Effect other than the proceedings itemized on Schedule 5.4
attached hereto.
Section 5.5.
Judgments . No judgments have been entered against any of
the Obligors which when aggregated with all judgments against all
Obligors exceed the Threshold Amount.
Section 5.6.
Borrower’s Representations An
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