Oct. 27, 2009 (PR Newswire) -- MCLEAN, Va., Oct. 27 /PRNewswire-FirstCall/ -- Sunrise Senior Living, Inc. (NYSE: SRZ) today announced that it entered into a restructuring agreement, in the form of a binding term sheet, with Capmark Finance Inc. and Natixis, London Branch, two lenders of Sunrise and certain of its affiliates, to settle and compromise their claims against Sunrise and certain of its affiliates, including under operating deficit and principal repayment guarantees provided by Sunrise and certain of its affiliates in support of Sunrise's German subsidiaries. Capmark Finance and Natixis contended that these claims had an aggregate value of approximately $121.6 million. The binding term sheet contemplates that, on or before the first anniversary of the execution of definitive documentation for the restructuring, certain other identified lenders of Sunrise may elect to participate in the restructuring with respect to their asserted claims. The claims being settled by Capmark Finance and Natixis represent approximately 77.5 percent of the aggregate amount of claims asserted by the lenders that may elect to participate in the restructuring transaction.
Sunrise also announced today that it entered into agreements with Sunrise's joint venture partner in the Fountains portfolio, as well as with HSH Nordbank AG, New York Branch, the lender to the Fountains venture, to release Sunrise from all claims that the joint venture partner and HSH Nordbank had against Sunrise prior to the date of the agreements and from all future funding obligations of Sunrise in connection with the Fountains portfolio.
"We are pleased that, after having previously exited Trinity Hospice, Greystone and Aston Gardens, substantially reduced our overhead run rate, stabilized our liquidity by selling assets and extended our credit line, we have now successfully restructured our Fountains portfolio and the bulk of our corporate obligations relating to Germany," said Mark Ordan, Sunrise's chief executive officer. "We have been following a plan to discontinue non-core operations and keep Sunrise focused as the premier senior living care provider."
Germany
The restructuring agreement, which was executed on October 22, 2009, provides that the electing lenders will release and discharge Sunrise from certain claims they may have against Sunrise. Sunrise will issue to the lenders that elect to participate in the restructuring on or before the first execution of the definitive documentation, their pro rata share of up to an aggregate of 5 million shares of Sunrise common stock and will grant mortgages for the benefit of all electing lenders on certain of its unencumbered North American properties. Following the first execution of the definitive documentation for the restructuring, Sunrise will pursue the sale of such mortgaged properties and distribute the net sale proceeds to the electing lenders. Sunrise has guaranteed that, within 30 months of the first execution of the definitive documentation for the restructuring, the electing lenders will receive a minimum of $58.3 million from the net proceeds of any such sale, which equals 80 percent of the most recent aggregate appraised value of these properties.
