exv10w48






Exhibit 10.48




EIGHTH AMENDMENT TO CREDIT AGREEMENT




     THIS EIGHTH AMENDMENT TO CREDIT AGREEMENT (this “Agreement”) is made as of July 23, 2008
between SUNRISE SENIOR LIVING, INC. a Delaware corporation (the “Company”), and BANK OF AMERICA,
N.A., as Administrative Agent, Swing Line Lender and Letter of Credit Issuer (the “Administrative
Agent”) for itself and certain additional lenders who are or shall be from time to time
participating as lenders pursuant to the Credit Agreement as hereinafter defined (collectively with
the Administrative Agent, the “Lenders”).



RECITALS




     A. The Lenders have made a Credit Facility available to the Company in the maximum principal
sum at any one time outstanding of $250,000,000.



     B. The Credit Facility is governed by a Credit Agreement dated December 2, 2005 as amended by
that certain First Amendment to Credit Agreement dated March 6, 2006, that certain Second Amendment
to Credit Agreement dated January 31, 2007, that certain Third Amendment to Credit Agreement dated
June 27, 2007, that certain Fourth Amendment to Credit Agreement dated September 17, 2007, that
certain Fifth Amendment to Credit Agreement dated January 31, 2008 (the “Fifth Amendment”), that
certain Sixth Amendment to Credit Agreement dated February 19, 2008 and that certain Seventh
Amendment to Credit Agreement dated March 13, 2008 (as amended by this Agreement, and as further
amended, modified, substituted, extended and renewed from time to time the “Credit Agreement”) by
and between the Company and the Lenders.



     C. The Credit Facility is guaranteed by the Guarantors pursuant to the terms of the Credit
Agreement.



     D. At the Company’s request, the Lenders have agreed to permanently reduce the maximum
principal sum of the Credit Facility to $160,000,000. The Company and the Lenders have also agreed
to (i) waive any defaults which have occurred under those certain financial covenants described in
Section 7.14 of the Credit Agreement for the fiscal year ending December 31, 2007 and the fiscal
quarters ending March 31, 2008, and June 30, 2008 and any defaults in certain financial covenants
which may occur during the fiscal quarter ending September 30, 2008 and (ii) and make such other
changes to the Credit Agreement as are more particularly set forth herein.



     E. As a condition precedent to the agreements referenced above, the Administrative Agent has
required that this Agreement be executed and delivered to the Administrative Agent on behalf of the
Lenders.



AGREEMENTS




     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 Company, the Lenders and the Administrative Agent hereby agree as
follows:



     1. The above Recitals are a part of this Agreement. Unless otherwise expressly defined in
this Agreement, terms defined in the Credit Agreement shall have the same meaning under this
Agreement.



     2. The Company represents and warrants to the Lender as follows:



          (a) The Company has the power and authority to execute and deliver this Agreement and perform
its obligations hereunder;




          (b) The Credit Agreement, as amended by this Agreement, and each of the other Loan Documents
remains in full force and effect, and each constitutes the valid and legally binding obligation of
Borrower, enforceable in accordance with its terms;




          (c) All of the Company’s representations and warranties contained in the Credit Agreement and
the other Loan Documents are true and correct on and as of the date of the Company’s execution of
this Agreement with the exception of representations and warranties regarding the form of financial
statements described in Section 6.5 of the Credit Agreement; and




          (d) No Event of Default and no event which, with notice, lapse of time or both would
constitute an Event of Default, has occurred and is continuing under the Credit Agreement or the
other Loan Documents which has not been waived in writing by the Lender with the exception of the
Events of Default pursuant to the financial covenants described in Section 7.14 of the Credit
Agreement.




     2. The Credit Agreement is hereby amended as follows:



          (a) The maximum principal sum of the Credit Facility is hereby permanently reduced to
$160,000,000. Pursuant thereto, the commitments and applicable percentages of the Lenders set
forth on Schedule 2.1 of the Credit Agreement are hereby amended and restated as set forth on
EXHIBIT A attached hereto.




          (b) The following defined terms are hereby added to Section 1.1 (Defined Terms):





     “Cash Equivalents” means any investment security issued by the United
States Government and backed by the full faith and credit of the United
States Government.




     “Required Liquidity” has the meaning set forth in section 7.14(a).



          (c) A new subsection (d) is hereby added to Section 7.14 (Financial Covenants) as follows:





     (d) Required Liquidity. The Borrower will maintain at all
times, tested as of the end of each calendar month until the Borrower has


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complied with the Updated Reporting Requirements (as hereinafter
defined) and is not otherwise in default under the Credit Facility liquidity
of not less than $50,000,000 composed of availability under this Credit
Facility plus up to not more than $50,000,000 in unrestricted Cash and
unrestricted Cash Equivalents (the “Required Liquidity”). The Borrower
shall provide a certificate of compliance with the Required Liquidity on or
before fifteen (15) days after the end of each such calendar month. The
face amounts of Letters of Credit outstanding hereunder and the Outstanding
Amounts of the Loans will be deducted from the maximum availability under
the Credit Facility for purposes of determining compliance with “Required
Liquidity.” If, at any time the unrestricted Cash and unrestricted Cash
Equivalents exceed $50,000,000, the Borrower shall be required to use such
excess funds to reduce the Outstanding Amounts of the Loans. During such
time as the Borrower is required to comply with the Required Liquidity
covenant, the Borrower must also provide evidence of compliance with the
Required Liquidity covenant with each delivery of a Committed Loan Notice in
order to receive funding of a Committed Loan or issuance of a Letter of
Credit.



     3. The Company hereby acknowledges and agrees that pursuant to the terms of Section 7.14 of
the Credit Agreement the Company is required to comply with certain financial covenants more
particularly described therein (the “Financial Covenants”). The Company, the Administrative Agent
and the Lenders hereby agree to waive compliance with the Financial Covenants for the fiscal year
ending December 31, 2007 and the fiscal quarters ending March 31, 2008 and June 30, 2008.
Additionally, the Company hereby acknowledges and agrees that the Company is not expected to be in
compliance with the Leverage Ratio and the Fixed Charge Coverage Ratio for the fiscal quarter
September 30, 2008. The Company, Administrative Agent and the Lenders hereby agree to waive
compliance with subsections 7.14(b) (Leverage Ratio) and 7.14(c) (Fixed Charge Coverage Ratio) for
the fiscal quarter ending September 30, 2008.



     4. Anything to the contrary set forth in Section 8.6 of the Credit Agreement notwithstanding,
the Borrower shall not declare or make directly or indirectly any Restricted Payment in the form of
a stock repurchase or payment of a cash dividend or incur any obligation (contingent or otherwise)
to do so; provided, however, share repurchases shall be permitted only to the extent the Company is
repurchasing shares from current or former employees or directors for tax withholdings purposes
with respect to outstanding restricted stock and option awards. The Administrative Agent and the
Lenders hereby agree that the limitations on stock repurchases and issuance of dividends shall
remain in effect until such time as the Company has delivered evidence satisfactory to
Administrative Agent, in Administrative Agent’s sole discretion, that the Company has timely filed
with the Securities and Exchange Commission (“SEC”) and the New York Stock Exchange (“NYSE”) its
Form 10(k) financial statement for its fiscal year ending December 31, 2008, is in compliance with
all Financial Covenants for the fiscal quarter ending December 31, 2008 and has timely delivered to
Administrative Agent a copy of such annual financial report and its Compliance Certificate
demonstrating to the satisfaction of the Administrative Agent in its sole discretion that the
Company is in compliance with all Financial Covenants for the fiscal quarter ending December 31,
2008 (collectively, the “Updated Reporting Requirements”) and is not otherwise in default under the
Credit Agreement.


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     5. Pursuant to the terms of Section 12 of the Fifth Amendment, the Company, the Administrative
Agent and the Lenders agreed that effective as of February 1, 2008, until the end of the Interest
Period in which the Administrative Agent acknowledges in writing satisfaction of certain conditions
set forth in the Fifth Amendment and notwithstanding anything in the Credit Agreement to the
contrary, the Applicable Rate shall be as follows: (a) the Eurodollar Rate Loans Margin shall be
275 basis points and (b) the Base Rate Loans Margin shall be 125 basis points (the “Increased
Applicable Rate”). In addition, the Company, the Administrative Agent and the Lenders hereby agree
that the Increased Applicable Rate shall continue to apply until the end of the Interest Period in
which the Company has complied with the Updated Filing Requirements and is not otherwise in default
under the Credit Facility.



     6. The Company, the Administrative Agent and the Lenders hereby agree that the Company shall
pay to the Administrative Agent for the account of each Lender that executes and delivers this
Agreement in compliance with the Administrative Agent’s instructions, in accordance with its
Applicable Percentage, a fee equal to twenty-five (25) basis points, based upon the reduced maximum
principal sum of $160,000,000.



     7. Except as specifically set forth herein, the terms, provisions and covenants of the Credit
Agreement, including, but not limited to, all financial covenants and definitions related thereto,
are hereby ratified and confirmed and remain in full force and effect.



     8. This Agreement may be executed in any number of duplicate originals or counterparts, each
of such duplicate originals or counterparts shall be deemed to be an original and all taken
together shall constitute but one and the same instrument.



     9. By their signatures below, the Guarantors consent to the transactions contemplated by and
the agreements made by the Company under this Agreement and ratify, confirm and reissue their
guaranty as set forth in the Credit Agreement.



[SIGNATURES APPEAR ON FOLLOWING PAGES]


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EXHIBIT A

SCHEDULE 2.1




COMMITMENTS

AND APPLICABLE PERCENTAGES




	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	Applicable
	Lender	 	Commitment	 	Percentage
	 
	Bank of
America, N.A. (in its own right and As successor to Lasalle Bank National Association
	 	$	59,200,000	 	 	 	37.000000000	%
	 
	 	 	 	 	 	 	 	 
	Wachovia Bank, National Association
	 	$	30,400,000	 	 	 	19.000000000	%
	 
	 	 	 	 	 	 	 	 
	HSBC Bank USA, N.A.
	 	$	16,000,000	 	 	 	10.000000000	%
	 
	 	 	 	 	 	 	 	 
	Manufacturers and Traders Trust Company (in its own
right and as successor to First Horizon Bank, a division
of First Tennessee Bank, N.A.)
	 	$	22,400,000	 	 	 	14.000000000	%
	 
	 	 	 	 	 	 	 	 
	PNC Bank, National Association in its own right and
as successor to Farmers & Mechanics Bank
	 	$	22,400,000	 	 	 	14.0000000000	%
	 
	 	 	 	 	 	 	 	 
	Chevy Chase Bank, F.S.B.
	 	$	9,600,000	 	 	 	6.000000000	%
	 
	 	 	 	 	 	 	 	 
	Total
	 	$	160,000,000	 	 	 	100.000000000	%






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     IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed and
delivered under seal by their duly authorized representatives as of the date and year first written
above.



	 	 	 	 	 	 	 	 	 
	 	 	COMPANY:	 	 
	 
	 	 	SUNRISE SENIOR LIVING, INC.	 	 
	 
	 

	 	By:
	 	/s/ Richard J. Nadeau
 

Name: Richard J. Nadeau
	(Seal)
	 	 
	 

	 	 	 	Title: Chief Financial Officer	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	GUARANTORS:	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	SUNRISE SENIOR LIVING MANAGEMENT, INC.	 	 
	 
	 

	 	By:
	 	/s/ Lisa Mayr
	(Seal)
	 	 
	 

	 	 	 	 	 	 	 	 
	 

	 	 	 	Name: Lisa Mayr	 	 	 	 
	 

	 	 	 	Title: Vice President	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	SUNRISE SENIOR LIVING INVESTMENTS, INC.	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Lisa Mayr
	(Seal)
	 	 
	 

	 	 	 	 	 	 	 	 
	 

	 	 	 	Name: Lisa Mayr	 	 	 	 
	 

	 	 	 	Title: Vice President	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	SUNRISE DEVELOPMENT, INC.	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Lisa Mayr
	(Seal)
	 	 
	 

	 	 	 	 	 	 	 	 
	 

	 	 	 	Name: Lisa Mayr	 	 	 	 
	 

	 	 	 	Title: Vice President	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	SUNRISE SENIOR LIVING SERVICES, INC.	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Lisa Mayr
	(Seal)
	 	 
	 

	 	 	 	 	 	 	 	 
	 

	 	 	 	Name: Lisa Mayr	 	 	 	 
	 

	 	 	 	Title: Vice President	 	 	 	 







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	 	 	BANK OF AMERICA, N.A., as	 	 
	 	 	Administrative Agent	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Kristine Thennes
 

Name: Kristine Thennes
	(Seal)
	 	 
	 

	 	 	 	Title: Vice President	 	 	 	 






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	 	 	BANK OF AMERICA, N.A., as a Lender, L/C Issuer and	 	 
	 	 	Swing Line Lender in its own right and as successor by	 	 
	 	 	merger to Lasalle Bank National Association	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Barbara P. Levy
 

Barbara P. Levy
	(Seal)
	 	 
	 

	 	 	 	Senior Vice President	 	 	 	 







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	 	WACHOVIA BANK, NATIONAL ASSOCIATION, as a 
Lender
	 
	 
	 	By:  	/s/ Frank S. Kaulback III
 	 
	 	Frank S. Kaulback III 
	 	Senior Vice President 
	 




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	 	HSBC BANK USA, N.A., as a Lender

 	 
	 	By:  	/s/ John P. Northington
 	 
	 	John P. Northington 	 
	 	Vice President 	 
	 



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	 	MANUFACTURERS AND TRADERS TRUST 

COMPANY, as a Lender in its own right and as successor by 
merger to First Horizon Bank, formerly a division of First

Tennessee Bank, N.A.

 	 
	 	By:  	/s/ Sharon P. O’Brien
 	 
	 	Sharon P. O’Brien 
	 	Vice President 
	 



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	 	CHEVY CHASE BANK, F.S.B., as a Lender

 	 
	 	By: 	/s/ Ellen-Elizabeth B. Lee
 	 
	 	Ellen-Elizabeth B. Lee 	 
	 	Assistant Vice President 	 
	 



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	 	PNC BANK, NATIONAL ASSOCIATION, as a Lender, in

its own right and as successor by merger to Farmers &

Mechanics Bank

 	 
	 	
By: 	 /s/ Michael J. Elehwany
 	 
	 	Michael J. Elehwany 	 
	 	Vice President 	 
	 


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