Exhibit 10.145

 

GUARANTY

(AdCare Health Systems Inc.)

 

This GUARANTY (“Guaranty”) is given as of October 29, 2010 (“Effective Date”),
by ADCARE HEALTH SYSTEMS INC., an Ohio corporation (“Guarantor”), in favor of
GEORGIA LESSOR — BONTERRA/PARKVIEW, INC., a Maryland corporation (“Lessor”).

 

RECITALS

 

A.                                   ADK BONTERRA/PARKVIEW, LLC, a Georgia
limited liability company (“Lessee”), has executed and delivered to Lessor a
Third Amended and Restated Master Lease dated as of the date of this Guaranty
(“Master Lease”), pursuant to which Lessee is leasing from Lessor certain
healthcare facilities located in the State of Georgia and identified in the
Master Lease (the “Facilities”).

 

B.                                     Guarantor owns 100% of the outstanding
equity interests of HEARTH & HOME OF OHIO, INC., an Ohio corporation, which in
turns owns 100% of the outstanding equity interests of Lessee, and it is to the
advantage of Guarantor that Lessor enter into the Master Lease.

 

C.                                     As a material inducement to Lessor to
enter into the Master Lease, Guarantor has agreed to guaranty the payment of all
amounts due from, and the performance of all obligations undertaken by the
Lessee under the Master Lease and the other Transaction Documents (as defined in
the Master Lease) on the terms and conditions of this Guaranty.

 

WHEREFORE, the parties hereby agree as follows.

 

1.                                       Defined Terms.  All capitalized terms
used herein and not defined herein shall have the meaning for such terms set
forth in the Master Lease.

 

2.                                       Guaranty.  Guarantor hereby
unconditionally and irrevocably guarantees to Lessor (i) the payment when due of
all Rent and all other sums payable by the Lessee under the Master Lease and the
other Transaction Documents, and (ii) the faithful and prompt performance when
due of each and every one of the terms, conditions and covenants to be kept and
performed by Lessee and its Affiliates under the Transaction Documents, any and
all amendments, modifications, extensions and renewals of the Transaction
Documents, including without limitation all indemnification obligations,
insurance obligations, and all obligations to operate, rebuild, restore or
replace any facilities or improvements now or hereafter located on the real
estate covered by the Master Lease (collectively, the “Liabilities”).  In the
event of the failure of Lessee to pay any such amounts owed, or to render any
other performance required of Lessee or its Affiliates under the Transaction
Documents, when due, Guarantor shall forthwith perform or cause to be performed
all provisions of the Transaction Documents to be performed by Lessee and its
Affiliates thereunder, and pay all damages that may result from the
non-performance thereof to the full extent provided under the Transaction
Documents.  As to the Liabilities, Guarantor’s liability under this Guaranty is
without limit.

 

--------------------------------------------------------------------------------

 

3.                                       Survival of Obligations.  The
obligations of Guarantor under this Guaranty with respect to the Transaction
Documents shall survive and continue in full force and effect notwithstanding:

 

(a)                                  any amendment, modification, or extension
by Lessee or, as applicable, any Affiliate, and Lessor of any Transaction
Document;

 

(b)                                 any compromise, release, consent, extension,
indulgence or other action or inaction in respect of any terms of any
Transaction Document or any other guarantor of the Liabilities;

 

(c)                                  any substitution or release, in whole or in
part, of any security for this Guaranty which Lessor may hold at any time;

 

(d)                                 any exercise or nonexercise by Lessor of any
right, power or remedy under or in respect of any Transaction Document or any
security held by Lessor with respect thereto, or any waiver of any such right,
power or remedy;

 

(e)                                  any bankruptcy, insolvency, reorganization,
arrangement, adjustment, composition, liquidation, or the like of the Lessee or
any other guarantor of the Liabilities;

 

(f)                                    any limitation of Lessee’s liability
under any Transaction Document or any limitation of Lessee’s liability
thereunder which may now or hereafter be imposed by any statute, regulation or
rule of law, or any illegality, irregularity, invalidity or unenforceability, in
whole or in part, of any Transaction Document or any term thereof, unless such
statute, regulation or rule of law expressly imposes by its terms any limitation
on the Guarantor’s liability under this Guaranty;

 

(g)                                 any sale, lease, or transfer of all or any
part of any interest in any Facility to any other person, firm or entity;

 

(h)                                 any act or omission by Lessor with respect
to any of the security instruments or any failure to file, record or otherwise
perfect any of the same;

 

(i)                                     any extensions of time to Lessee, any
Affiliate of Lessee, or any other guarantor of the Liabilities for performance
under the Transaction Documents, whether prior to or after maturity;

 

(j)                                     the release of any collateral from any
lien in favor of Lessor held with respect to any of the Transaction Documents,
or the release of Lessee from performance or observation of any of the
agreements, covenants, terms or conditions contained in any Transaction Document
by operation of law or otherwise;

 

(k)                                  the fact that Lessee may or may not be
personally liable, in whole or in part, under the terms of any Transaction
Document to pay any money judgment;

 

(l)                                     the failure to give Guarantor any notice
of acceptance, default or otherwise;

 

2

--------------------------------------------------------------------------------

 

(m)                               any other guaranty now or hereafter executed
by Guarantor or anyone else in connection with any Transaction Document;

 

(n)                                 any rights, powers or privileges Lessor may
now or hereafter have against any other person, entity or collateral with
respect to the Transaction Documents; or

 

(o)                                 any other circumstances, whether or not
Guarantor had notice or knowledge thereof, other than the payment or performance
of all of the Liabilities.

 

4.                                       Primary Liability.  The liability of
Guarantor with respect to the Liabilities shall be primary, direct and
immediate, and Lessor may proceed against Guarantor: (i) prior to or in lieu of
proceeding against Lessee, its assets, any security deposit, or any other
guarantor of the Liabilities; and (ii) prior to or in lieu of pursuing any other
rights or remedies available to Lessor.  All rights and remedies afforded to
Lessor by reason of this Guaranty or by law are separate, independent and
cumulative, and the exercise of any rights or remedies shall not in any way
limit, restrict or prejudice the exercise of any other rights or remedies.  In
the event of any default under any Transaction Document, a separate action or
actions may be brought and prosecuted against Guarantor whether or not Lessee is
joined therein or a separate action or actions are brought against Lessee. 
Lessor may maintain successive actions for other defaults.  Lessor’s rights
hereunder shall not be exhausted by its exercise of any of its rights or
remedies or by any such action or by any number of successive actions until and
unless all indebtedness and obligations the payment and performance of which are
hereby guaranteed have been paid and fully performed.

 

5.                                       Obligations Not Affected.  In such
manner, upon such terms and at such times as Lessor in its sole discretion deems
necessary or expedient, and without notice to Guarantor, Lessor may:  (a) amend,
alter, compromise, accelerate, extend or change the time or manner for the
payment or the performance of any obligation hereby guaranteed; (b) extend,
amend or terminate any of the Transaction Documents; or (c) release Lessee by
consent to any assignment (or otherwise) as to all or any portion of the
Liabilities.  Any exercise or non-exercise by Lessor of any right hereby given
Lessor, dealing by Lessor with Guarantor or any other guarantor, Lessee or any
other person, or change, impairment, release or suspension of any right or
remedy of Lessor against any person including Lessee and any other guarantor
will not affect any of the obligations of Guarantor hereunder or give Guarantor
any recourse or offset against Lessor.

 

6.                                       Waiver.  With respect to the
Transaction Documents, Guarantor hereby waives and relinquishes all rights and
remedies accorded by applicable law to sureties and/or guarantors or any other
accommodation parties, under any statutory provisions, common law or any other
provision of law, custom or practice, and agrees not to assert or take advantage
of any such rights or remedies including, but not limited to:

 

(a)                                  any right to require Lessor to proceed
against the Lessee or any other person or to proceed against or exhaust any
security held by Lessor at any time or to pursue any other remedy in Lessor’s
power before proceeding against Guarantor or to require that Lessor cause a
marshaling of Lessee’s assets or the assets, if any, given as collateral for
this Guaranty or to proceed against Lessee and/or any

 

3

--------------------------------------------------------------------------------

 

collateral, including collateral, if any, given to secure Guarantor’s obligation
under this Guaranty, held by Lessor at any time or in any particular order;

 

(b)                                 any defense that may arise by reason of the
incapacity or lack of authority of any other person or persons acting on behalf
of Guarantor, Lessee, any Affiliate of Lessee, or any other guarantor of the
Liabilities;

 

(c)                                  notice of the existence, creation or
incurring of any new or additional indebtedness or obligation or of any action
or non-action on the part of Lessee, Lessor, any creditor of Lessee or Guarantor
or on the part of any other person whomsoever under this or any other instrument
in connection with any obligation or evidence of indebtedness held by Lessor or
in connection with any of the Liabilities;

 

(d)                                 any defense based upon an election of
remedies by Lessor which destroys or otherwise impairs the subrogation rights of
Guarantor or the right of Guarantor to proceed against Lessee for reimbursement,
or both;

 

(e)                                  any defense based upon any statute or rule
of law which provides that the obligation of a surety must be neither larger in
amount nor in other respects more burdensome than that of the principal;

 

(f)                                    any duty on the part of Lessor to
disclose to Guarantor any facts Lessor may now or hereafter know about Lessee,
regardless of whether Lessor has reason to believe that any such facts
materially increase the risk beyond that which Guarantor intends to assume or
has reason to believe that such facts are unknown to Guarantor or has a
reasonable opportunity to communicate such facts to Guarantor, it being
understood and agreed that Guarantor is fully responsible for being and keeping
informed of the financial condition of Lessee and of all circumstances bearing
on the risk of non-payment or non-performance of any obligations or indebtedness
hereby guaranteed;

 

(g)                                 any defense arising because of Lessor’s
election, in any proceeding instituted under the federal Bankruptcy Code, of the
application of Section 1111 (b)(2) of the federal Bankruptcy Code; and

 

(h)                                 any defense based on any borrowing or grant
of a security interest under Section 364 of the federal Bankruptcy Code.

 

(i)                                     all rights and remedies accorded by
applicable law to guarantors, including without limitation, any extension of
time conferred by any law now or hereafter in effect and any requirement or
notice of acceptance of this Guaranty or any other notice to which the
undersigned may now or hereafter be entitled to the extent such waiver of notice
is permitted by applicable law.

 

7.                                       Warranties.  With respect to the
Transaction Documents, Guarantor warrants that: (a) this Guaranty is executed at
Lessee’s request; and (b) Guarantor has established adequate means of obtaining
from Lessee on a continuing basis financial and other information pertaining

 

4

--------------------------------------------------------------------------------

 

to Lessee’s financial condition.  Guarantor agrees to keep adequately informed
from such means of any facts, events or circumstances which might in any way
affect Guarantor’s risks hereunder, and Guarantor further agrees that Lessor
shall have no obligation to disclose to Guarantor information or material
acquired in the course of Lessor’s relationship with Lessee.

 

8.                                       No-Subrogation.  Until all obligations
of Lessee under Transaction Documents have been satisfied and discharged in full
for one (1) year (provided, however, that Lessee’s obligations under Section 7.3
of the Master Lease which expressly survive expiration or termination thereof
shall, so long as there is no currently pending claim under such section, not be
considered in determining whether the Lessee’s obligations have been satisfied
or discharged), Guarantor shall have no right of subrogation and waives any
right to enforce any remedy which Lessor now has or may hereafter have against
Lessee and any benefit of, and any right to participate in, any security now or
hereafter held by Lessor with respect to the Master Lease.

 

9.                                       Subordination.  Upon the occurrence of
an Event of Default under any Transaction Document, which is not cured by
Guarantor, the indebtedness or obligations of Lessee to Guarantor shall not be
paid in whole or in part nor will Guarantor accept any payment of or on account
of any amounts owing, without the prior written consent of Lessor and at
Lessor’s request, Guarantor shall cause Lessee to pay to Lessor all or any part
of the subordinated indebtedness until the obligations under the Transaction
Documents have been paid in full. Any payment by Lessee in violation of this
Guaranty shall be received by Guarantor in trust for Lessor, and Guarantor shall
cause the same to be paid to Lessor immediately on account of the amounts owing
from Lessee to Lessor.  No such payment will reduce or affect in any manner the
liability of Guarantor under this Guaranty.

 

10.                                 No Delay.  Any payments required to be made
by Guarantor hereunder shall become due on demand in accordance with the terms
hereof immediately upon the happening of an Event of Default under any
Transaction Document.

 

11.                                 Application of Payments.  With respect to
the Transaction Documents, and with or without notice to Guarantor, Lessor, in
Lessor’s sole discretion and at any time and from time to time and in such
manner and upon such terms as Lessor deems appropriate, may (a) apply any or all
payments or recoveries from Lessee or from any other guarantor of the
Liabilities under any other instrument or realized from any security, in such
manner and order of priority as Lessor may determine, to any indebtedness or
other obligation of the Lessee with respect to the Transaction Documents and
whether or not such indebtedness or other obligation is guaranteed hereby or is
otherwise secured or is due at the time of such application, and (b) refund to
Lessee any payment received by Lessor under the Transaction Documents.

 

12.                                 Guaranty Default.

 

(a)                                  As used herein, the term Guaranty Default
shall mean one or more of the following events (subject to applicable cure
periods):

 

(i)                                     the failure of Guarantor to pay the
amounts required to be paid hereunder at the times specified herein;

 

5

--------------------------------------------------------------------------------

 

(ii)                                  the failure of Guarantor to observe and
perform any covenants, conditions or agreement on its part to be observed or
performed, other than as referred to in Subsection (i) above, for a period of
thirty (30) days after written notice of such failure has been given to
Guarantor by Lessor, unless Lessor agrees in writing to an extension of such
time prior to its expiration;

 

(iii)                               the occurrence of an Event of Default under
the Master Lease or any of the other Transaction Documents.

 

(b)                                 Upon the occurrence of a Guaranty Default,
Lessor shall have the right to bring such actions at law or in equity, including
appropriate injunctive relief, as it deems appropriate to compel compliance,
payment or deposit, and among other remedies to recover its reasonable
attorneys’ fees in any proceeding, including any appeal therefrom and any
post-judgement proceedings.

 

13.                                 Financial Covenants.  At all times while any
Obligations guaranteed by Guarantor remain outstanding, Guarantor shall comply
with any and all financial covenants of the Master Lease applicable to
Guarantor, as the same may be amended, modified or restated from time to time.

 

14.                                 Financial Statements.  As and when required
under the Master Lease, Guarantor shall deliver to Lessor such Financial
Statements of Guarantor as are required under the Master Lease.

 

15.                                 Notices.  All notices, demands or requests
required or permitted to be given to either party hereto shall be in writing and
shall be deemed given if delivered personally, sent by reputable overnight
courier, with acknowledgment of receipt requested, or mailed by registered,
overnight or certified mail, with full postage paid thereon, return receipt
requested (such notice to be effective on the date such receipt is
acknowledged), as follows:

 

Guarantor:

 

AdCare Health Systems Inc.
Two Buckhead Plaza
3050 Peachtree Road NW, Suite 570
Atlanta, Georgia 30305
Attention: Chris Brogdon
Tel: (770) 650-7086, ext. 12
Fax: (770) 650-8883

 

 

 

With copy to:

 

Gregory P. Youra, Esq.
Holt Ney Zatcoff & Wasserman, LLP
100 Galleria Parkway, Suite 600
Atlanta, Georgia 30339
Tel: (770) 956-9600
Fax: (770) 956-1490

 

6

--------------------------------------------------------------------------------

 

Lessor

 

c/o Omega Healthcare Investors, Inc.
200 International Circle, Suite 3500
Hunt Valley, MD 21030
Attn: Daniel J. Booth
Telephone No.: (410) 427-1700
Facsimile No.: (410) 427-8800

 

 

 

With copy to:

 

Doran Derwent, PLLC
5960 Tahoe Dr., SE, Suite 101
Grand Rapids, Michigan 49546
Attn: Mark E. Derwent
Telephone No.: (616) 451-8690
Facsimile No.: (616) 451-8697

 

or to such place and with such other copies as Guarantor or Lessor may designate
for itself by written notice to the other.

 

16.                                 Miscellaneous.

 

(a)                                  No term, condition or provision of this
Guaranty may be waived except by an express written instrument to that effect
signed by Lessor.  No waiver of any term, condition or provision of this
Guaranty will be deemed a waiver of any other term, condition or provision,
irrespective of similarity, or constitute a continuing waiver of the same term,
condition or provision, unless otherwise expressly provided.

 

(b)                                 If any one or more of the terms, conditions
or provisions contained in this Guaranty is found in a final award or judgment
rendered by any court of competent jurisdiction to be invalid, illegal or
unenforceable in any respect, the validity, legality and enforceability of the
remaining terms, conditions and provisions of this Guaranty shall not in any way
be affected or impaired thereby, and this Guaranty shall be interpreted and
construed as if the invalid, illegal, or unenforceable term, condition or
provision had never been contained in this Guaranty.

 

(c)                                  THIS GUARANTY SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF MARYLAND, EXCEPT THAT THE
LAWS OF THE STATE IN WHICH A FACILITY IS LOCATED SHALL GOVERN THIS AGREEMENT TO
THE EXTENT NECESSARY (i) TO OBTAIN THE BENEFIT OF THE RIGHTS AND REMEDIES SET
FORTH HEREIN WITH RESPECT TO SUCH FACILITY, AND (ii) FOR PROCEDURAL REQUIREMENTS
WHICH MUST BE GOVERNED BY THE LAWS OF THE STATE IN WHICH SUCH FACILITY IS
LOCATED.  GUARANTOR CONSENTS TO IN PERSONAM JURISDICTION BEFORE THE STATE AND
FEDERAL COURTS OF THE STATE OR STATES IN WHICH THE FACILITY OR FACILITIES ARE
LOCATED AND AGREES THAT ALL DISPUTES CONCERNING THIS GUARANTY BE HEARD IN THE
STATE AND FEDERAL COURTS LOCATED IN THE STATE OR STATES IN WHICH THE FACILITY OR
FACILITIES ARE LOCATED.  GUARANTOR AGREES THAT SERVICE OF PROCESS MAY BE
EFFECTED UPON IT UNDER ANY METHOD PERMISSIBLE UNDER THE LAWS OF THE STATE OR
STATES IN WHICH THE FACILITY OR FACILITIES ARE LOCATED AND IRREVOCABLY

 

7

--------------------------------------------------------------------------------

 

WAIVES ANY OBJECTION TO VENUE IN THE STATE AND FEDERAL COURTS OF THE STATE OR
STATES IN WHICH THE FACILITY OR FACILITIES ARE LOCATED.

 

(d)                                 GUARANTOR AND LESSOR HEREBY WAIVE TRIAL BY
JURY AND THE RIGHT THERETO IN ANY ACTION OR PROCEEDING OF ANY KIND ARISING ON,
UNDER, OUT OF, BY REASON OF OR RELATING IN ANY WAY TO THIS GUARANTY OR THE
INTERPRETATION, BREACH OR ENFORCEMENT THEREOF.

 

(e)                                  In the event of any suit, action,
arbitration or other proceeding to interpret this Guaranty, or to determine or
enforce any right or obligation created hereby, the prevailing party in the
action shall recover such party’s actual costs and expenses reasonably incurred
in connection therewith, including, but not limited to, attorneys’ fees and
costs of appeal, post judgment enforcement proceedings (if any) and bankruptcy
proceedings (if any).  Any court, arbitrator or panel of arbitrators shall, in
entering any judgment or making any award in any such suit, action, arbitration
or other proceeding, in addition to any and all other relief awarded to such
prevailing party, include in such-judgment or award such party’s costs and
expenses as provided in this paragraph.

 

(f)                                    Guarantor (i) represents that it has been
represented and advised by counsel in connection with the execution of this
Guaranty; (ii) acknowledges receipt of a copy of the Transaction Documents; and
(iii) further represents that Guarantor has been advised by counsel with respect
thereto.  This Guaranty shall be construed and interpreted in accordance with
the plain meaning of its language, and not for or against Guarantor or Lessor,
and as a whole, giving effect to all of the terms, conditions and provisions
hereof.

 

(g)                                 Except as provided in any other written
agreement now or at any time hereafter in force between Lessor and Guarantor,
this Guaranty shall constitute the entire agreement of Guarantor with Lessor
with respect to the subject matter hereof, and no representation, understanding,
promise or condition concerning the subject matter hereof will be binding upon
Lessor or Guarantor unless expressed herein.

 

(h)                                 All stipulations, obligations, liabilities
and undertakings under this Guaranty shall be binding upon Guarantor and its
respective successors and assigns and shall inure to the benefit of Lessor and
to the benefit of Lessor’s successors and assigns.

 

(i)                                     Whenever the singular shall be used
hereunder, it shall be deemed to include the plural (and vice-versa) and
reference to one gender shall be construed to include all other genders,
including neuter, whenever the context of this Guaranty so requires.  Section
captions or headings used in the Guaranty are for convenience and reference
only, and shall not affect the construction thereof.

 

Signatures on following page.

 

8

--------------------------------------------------------------------------------

 

IN WITNESS WHEREOF, the undersigned has executed this Guaranty in favor of
GEORGIA LESSOR — BONTERRA/PARKVIEW, INC., a Maryland corporation, as of the date
first written above.

 

 

GUARANTOR:

 

 

 

 

 

ADCARE HEALTH SYSTEMS INC., an Ohio corporation

 

 

 

By:

/s/ David A. Tenwick

 

 

David A. Tenwick

 

 

Chairman

 

 

STATE OF OHIO

)

 

) SS

COUNTY OF DELAWARE

)

 

This instrument was acknowledged before me on the 29th day of October, 2010, by
David A. Tenwick, the Chairman of ADCARE HEALTH SYSTEMS INC., an Ohio
corporation, on behalf of said corporation.

 

 

 

/s/ Amanda R. Norris

 

Notary Public, Marion County, Ohio

 

My Commission Expires: April 1, 2015

 

--------------------------------------------------------------------------------