Unassociated Document


    
       

      Exhibit
        10.82

      

        (Heritage
          Club at Lowry)

         

        EXCEPTIONS
          TO NONRECOURSE GUARANTY

         

        THIS
          EXCEPTIONS TO NONRECOURSE GUARANTY (“Guaranty”) is entered into as of
          __________, 2005, by the undersigned (the “Key Principal” whether one or more),
          for the benefit of and in order to induce GMAC COMMERCIAL MORTGAGE BANK,
          a Utah
          industrial bank (together with its “successors and assigns,” the “Lender), to
          make a loan to DENVER LOWRY JV, LLC, a Delaware limited liability company
          (the
“Borrower”), in the amount of $25,480,000.00 (the “Loan”).

         

        RECITALS

         

        A.  The
          Loan
          is evidenced by a Promissory Note from Borrower to Lender of even date
          herewith
          (the “Note”). The Loan is secured by Deed of Trust, Assignment of Rents and
          Security Agreement of even date herewith (the “Mortgage”), covering the property
          described in the Mortgage and located in Denver, Denver County, Colorado
          (the
“Property”).

         

        B.  The
          Note,
          as may be amended from time to time, shall be referred to in this Guaranty
          as
          the “Note.” The Mortgage, as may be amended from time to time, shall be referred
          to in this Guaranty as the “Mortgage.” The term “Loan Documents” when used in
          this Guaranty, shall mean, collectively, the following documents: (i) the
          Note,
          (ii) the Mortgage, (iii) the Loan Agreement by and between Borrower and
          Lender
          of even date herewith (“Loan Agreement”), and (iv) all other documents or
          agreements executed in connection with the Loan, whether presently existing
          or
          hereinafter entered into, as such Loan Documents may be amended from time
          to
          time.

         

        C.  Lender
          is
          not willing to make the Loan unless the undersigned Key Principal executes
          this
          Guaranty.

         

        NOW,
          THEREFORE, in order to induce Lender to make the Loan evidenced by the
          Note and
          secured by the Mortgage, and in consideration thereof, Key Principal hereby
          (1)
          irrevocably and unconditionally, guarantees to Lender the prompt payment
          when
          due, by acceleration or otherwise, all of the obligations and liabilities
          of
          Borrower under the Loan Documents in the event of Borrower’s default under
          Section 13 or Section 25 (but not an event of default arising from any
          act or
          omission of Borrower under Section 6.19(q) of the Loan Agreement) of the
          Mortgage, which is not cured within thirty (30) days after Lender’s written
          notice thereof and (2) irrevocably and unconditionally guarantees to Lender
          the
          full and prompt payment to Lender of all claims, suits, liabilities (including,
          without limitation, strict liabilities), actions, proceedings, obligations,
          debts, damages, losses, costs, expenses, diminutions in value, fines, penalties,
          charges, fees, judgments, awards, amounts paid in settlement, foreseeable
          and
          unforeseeable consequential damages, of whatever kind or nature (collectively,
          “Losses”) to the extent due to: (a) fraud or intentional misrepresentation by
          Borrower or ARC Lowry, LLC, a Tennessee limited liability company
          (“Managing

         

        
          
            
            

          

          
            
            

            
              

            

          

          
            
            

          

        

         

        Member”),
          or Key Principal in connection with the execution and the delivery of the
          Note,
          the Mortgage or any of the other Loan Documents, (b) Borrower’s and/or Manager’s
          (as defined in the “Loan Agreement”) misapplication or misappropriation of
          accounts receivable collected in advance or received by Borrower or Manager
          after the occurrence of an Event of Default (as defined in the Loan Documents),
          (c) the misapplication or the misappropriation of insurance proceeds or
          condemnation awards by any person other than Lender, (d) Borrower’s and/or
          Manager’s failure to pay Impositions (as defined in the Mortgage) when due
          (except to the extent that sums sufficient to pay such amounts have been
          deposited in escrow with Lender pursuant to the terms of the Mortgage)
          or
          Borrower’s and/or Manager’s failure to comply with Section 5.26 of the Loan
          Agreement with respect to charges for labor or materials or other charges
          that
          can create liens or security interests that have priority over Lender’s lien
          under the Mortgage or security interest under the Loan Documents with respect
          to
          the Property, (e) Borrower’s and/or Manager’s failure to manage, maintain,
          repair, restore and otherwise operate the Property in a commercially reasonable
          manner in accordance with the Mortgage and the other Loan Documents, which
          is
          not cured within thirty (30) days after Lender’s written notice thereof, (f)
          Borrower’s failure to comply with Section 6.4 of the Loan Agreement with respect
          to any property taken from the Property by or on behalf of Borrower and
          not
          replaced with property of the same utility and of the same or greater value,
          (g)
          any act of actual waste or arson or criminal acts by Borrower or Manager,
          or any
          principals or constituents thereof or by any indemnitor or Key Principal
          with
          respect to the Property, (h) any fees or distributions paid by Borrower
          to any
          principal, affiliate, member or Managing Member thereof or to any indemnitor
          or
          Key Principal in violation of the terms of the Note, the Mortgage or the
          other
          Loan Documents, (i) Borrower’s failure to pay all fees, charges and taxes with
          respect to the making of the Note and/or the recording of the Mortgage,
          (j)
          Borrower’s failure to comply with Article VIII of the Loan Agreement, (k) the
          occurrence of an Event of Default under Section 9.1(f) of the Loan Agreement,
          but only if Borrower has consented to a proceeding constituting an Event
          of
          Default under such Section 9.1(f), or if Borrower, Key Principal, Managing
          Member or any affiliate of Borrower, Key Principal or Managing Member has
          acted
          in concert with, colluded or conspired to cause such proceeding, (l) the
          occurrence of an Event of Default under Section 9.1(e) of the Loan Agreement,
          except for a proceeding or a petition filed by Manager, which is not in
          any way
          affiliated with Borrower or Guarantor, (m) the Borrower’s failure to maintain
          and preserve free of all security interests and other encumbrances, all
          legal
          and beneficial interests in all certificates of need and other licensure
          and
          regulatory approvals required for operation of the Property, including,
          without
          limitation, if applicable, any approvals required to obtain reimbursements
          under
          Medicare (as defined in the Loan Agreement), Medicaid (as defined in the
          Loan
          Agreement) and any veteran’s program benefits (as applicable), (n) Borrower’s
          failure to pay all fees and expenses of Lender pursuant to Section 10.2
          of the
          Loan Agreement, (o) failure of Borrower to comply with Section 5.6 or Section
          5.8 of the 

         

        
          
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        Loan
          Agreement relating to the delivery of financial information, books and
          records,
          reports, statements, notices, contracts and leases, which is not cured
          within
          thirty (30) days after Lender’s written notice thereof, (p) Borrower’s failure
          to cause to be maintained, the insurance coverages and policies with respect
          to
          the Property and the Facility (as defined in the Loan Agreement) more fully
          described in Section 5.5 of the Loan Agreement or (q) Borrower’s failure to
          maintain adequate capital for the normal obligations reasonably foreseeable
          in a
          business of its size and character and in light of its contemplated business
          operations (all items listed in 1 and 2 above are collectively referred
          to
          herein as the “Guaranteed Obligations”). Key Principal hereby also irrevocably
          and unconditionally agrees to pay, on demand, all costs and expenses, including
          reasonable attorneys’ fees and disbursements, incurred by Lender in enforcing
          its rights under this Guaranty. Nothing herein shall be deemed to be a
          waiver of
          any right which Lender may have under Sections 506(a), 506(b), 1111(b)
          or any
          other provisions of the Bankruptcy Code to file a claim for the full amount
          of
          the Indebtedness (as defined in the Mortgage) secured by the Mortgage or
          to
          require that all collateral shall continue to secure all of the Indebtedness
          owing to Lender in accordance with this Note, the Mortgage and the other
          Loan
          Documents. This Guaranty is an unconditional guaranty of payment, and not
          a
          guaranty of collection, and may be enforced by Lender directly against
          Key
          Principal without any requirement that Lender must first exercise its rights
          against Borrower or, if Borrower is a partnership, any general partner
          of
          Borrower or any collateral or other security for payment of the
          Note.

         

        The
          obligations of Key Principal under this Guaranty shall be performed without
          demand by Lender and shall be unconditional irrespective of the genuineness,
          validity, regularity or enforceability of the Note, the Mortgage, the Loan
          Agreement, the Loan Documents, or any other circumstance which might otherwise
          constitute a legal or equitable discharge of a surety or a guarantor. Key
          Principal hereby waives the benefit of all principles or provisions of
          law,
          statutory or otherwise, which are or might be in conflict with the terms
          of this
          Guaranty, and agrees that the obligations of Key Principal shall not be
          affected
          by any circumstances, whether or not referred to in this Guaranty, which
          might
          otherwise constitute a legal or equitable discharge of a surety or guarantor.
          Key Principal hereby waives the benefits of any right of discharge under
          any and
          all statutes or other laws relating to guarantors or sureties and any other
          rights of sureties and guarantors thereunder. Without limiting the generality
          of
          the foregoing, Key Principal hereby waives diligence, presentment, demand
          for
          payment, protest, all notices which may be required by statute, rule of
          law or
          otherwise to preserve intact Lender’s rights against Key Principal under this
          Guaranty, including, but not limited to, notice of acceptance, notice of
          any
          amendment of the Loan Documents, notice of the occurrence of any default,
          notice
          of intent to accelerate, notice of acceleration, notice of dishonor, notice
          of
          foreclosure, notice of protest, notice of the incurring by Borrower of
          any of
          the Guaranteed Obligations, and generally, all demands, notices and other
          formalities of every kind in connection with this Guaranty, and all rights
          to
          require Lender to (a) proceed against Borrower or, if Borrower is a partnership,
          any general partner of Borrower, (b) proceed against or exhaust any collateral
          held by Lender to secure the payment of the Loan, or (c) pursue any other
          remedy
          it may now or hereafter have against Borrower, or, if Borrower is a partnership,
          any general partner of Borrower.

         

        Notwithstanding
          anything contained in the Loan Documents to the contrary, Key Principal
          covenants and agrees to maintain, until such time as the Loan has been
          paid in
          full, a Liquidity Amount of $10,000,000.00 and a Fixed Charge Coverage
          Ratio (as
          defined herein) of 1.25. For purposes hereof, “Liquidity Amount” shall mean
          unencumbered and unrestricted cash and cash equivalents as approved by
          Lender in
          its sole discretion. For purposes hereof, “Fixed Charge Coverage Ratio” shall
          mean, at the end of any fiscal quarter of Key Principal, the ratio of (a)
          Portfolio EBITDAR to (b) Portfolio Fixed Charges, as defined herein. “Portfolio
          EBITDAR shall mean, as of the end of any fiscal quarter of Key Principal,
          the
          aggregate net income of Key Principal and its subsidiaries, as determined
          in
          accordance with GAAP on a consolidated basis, during the trailing six (6)-month
          period, adjusted to add thereto, without duplication, (a) interest expense,
          (b)
          income tax expense, (c) depreciation and amortization expense, and (d)
          rental
          expense, as determined in accordance with GAAP on a consolidated basis,
          during
          such trailing six (6)-month period, and as further adjusted to add thereto
          or
          subtract there from (I) any gains or losses arising from the sale of assets,
          (ii) any non-cash stock based employee compensation expense arising from
          the
          application of (X)APB 25 “Accounting for Stock Issued to Employees”, (Y) SFAS
          123R, “Accounting for Shared 

         

        
          
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        Based
          Payment” or (Y) SFAS No. 148, “Stock-Based Compensation Transition and
          Disclosure” or (II) any items of income or expense which are deemed to be
“extraordinary” in accordance with GAAP, and any other non-cash, non-recurring
          charges and expenses. As used herein, “non-recurring charges and expenses” means
          expenditures or charges that (i) have not been incurred within the prior
          two
          years, and (ii) are not reasonably likely to recur within the subsequent
          two
          year period. “Portfolio Fixed Charges” shall mean, as of the end of any fiscal
          quarter of Key Principal, the sum of (a) all net lease expenses, (b) all
          interest expenses (including the interest component of rentals under capitalized
          leases), exclusive of prepayment fees or one-time loan fees or similar
          expenses,
          (c) all scheduled principal amortization payments under indebtedness or
          capitalized leases, exclusive of balloon payments due on maturity or expiration,
          as applicable, (d) all dividends paid on preferred stock, and (e) all mandatory
          distributions of earnings to shareholders, for Key Principal and its
          subsidiaries, as determined on a consolidated basis in accordance with
          GAAP,
          during the trailing six (6)-month period. 

         

        Key
          Principal hereby agrees that, at any time or from time to time and any
          number of
          times, without notice to Key Principal and without affecting the liability
          of
          Key Principal, (a) the time for payment of the principal and/or interest
          on the
          Note may be extended or the Note may be renewed in whole or in part one
          or more
          times; (b) the time for Borrower’s performance of or compliance with any
          covenant or agreement contained in the Note, the Mortgage, the Loan Agreement,
          or any of the other Loan Documents evidencing, securing or governing the
          Loan,
          whether presently existing or hereinafter entered into, may be extended
          or such
          performance or compliance may be waived; (c) the maturity of the Note may
          be
          accelerated as provided therein or in the Mortgage, or any of the other
          Loan
          Documents; (d) the Note, the Mortgage, the Loan Agreement, or any other
          Loan
          Documents, may be modified or amended by Lender and Borrower in any respect,
          including, but not limited to, an increase in the principal amount; and
          (e) any
          security for the Loan may be modified, exchanged, surrendered or otherwise
          dealt
          with or additional security may be pledged or mortgaged for the
          Loan.

         

        If
          any
          payment by Borrower is held to constitute a preference under any applicable
          bankruptcy or similar laws, or if for any reason Lender is required to
          refund
          any sums to Borrower, such amounts shall not constitute a release of any
          liability of Key Principal hereunder. It is the intention of Lender and
          Key
          Principal that Key Principal’s obligations hereunder shall not be discharged
          except by Key Principal’s performance of such obligations and then only to the
          extent of such performance.

         

        Any
          obligation or debt of Borrower now or hereafter held by Key Principal is
          hereby
          subordinated to the Guaranteed Obligations. Following the occurrence of
          an Event
          of Default (as defined in the Loan Agreement), Key Principal shall not
          enforce
          or collect any such indebtedness from Borrower. Nevertheless, upon request
          by
          Lender, Key Principal shall collect, enforce and receive such indebtedness
          of
          Borrower to Key Principal. Any sums collected at Lender’s request or collected
          in contravention of the prohibition set forth herein shall be held by Key
          Principal as trustee for Lender and shall be paid over to Lender on account
          of
          the Guaranteed Obligations; provided, however, that such payments shall
          not
          impair, reduce or affect in any manner the liability of Key Principal under
          the
          other provisions of this Guaranty.

         

        
          
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        Key
          Principal agrees that Lender, in its sole and absolute discretion, may
          (a) bring
          suit against Key Principal and any guarantor(s) of the Loan, if any, jointly
          and
          severally, or against any one or more of them; (b) release any guarantor(s)
          of
          the Loan, if any, from liability thereunder; and (d) otherwise deal with
          Key
          Principal and any guarantor(s) of the Loan, if any, or any one or more
          of them,
          in any manner whatsoever, and that no such action shall impair the rights
          of
          Lender to collect the Guaranteed Obligations from Key Principal. Nothing
          contained in this paragraph shall in any way affect or impair the rights
          or
          obligations of the Key Principal with respect to any guarantor of the Loan,
          if
          any.

         

        Lender
          may
          assign its rights under this Guaranty in whole or in part and upon any
          such
          assignment, all the terms and provisions of this Guaranty shall inure to
          the
          benefit of such assignee to the extent so assigned. The terms used to designate
          any of the parties herein shall be deemed to include the heirs, legal
          representatives, successors and assigns of such parties; and the term “Lender”
shall include, in addition to Lender, any lawful owner, holder or pledgee
          of the
          Note.

         

        Key
          Principal shall have no right of, and hereby waives any claim for, subrogation
          or reimbursement against the Borrower or, if Borrower is a general partnership,
          any general partner of Borrower by reason of any payment by Key Principal
          under
          this Guaranty, whether such right or claim arises at law or in equity or
          under
          any contract or statute.

         

        KEY
          PRINCIPAL HEREBY WAIVES TRIAL BY JURY IN ANY ACTION OR PROCEEDING COMMENCED
          BY
          LENDER AGAINST KEY PRINCIPAL UNDER THIS GUARANTY.

         

        Key
          Principal irrevocably submits to the jurisdiction of any state or federal
          court
          sitting in the State of Colorado over any suit, action, or proceeding arising
          out of or relating to this Guaranty. Key Principal irrevocably waives,
          to the
          fullest extent permitted by law, any objection that it may now or hereafter
          have
          to the laying of the venue of any such suit, action or proceeding brought
          in any
          such court and any claim that any such suit, action, or proceeding brought
          in
          any such court has been brought in an inconvenient forum. Final judgment
          in any
          such suit, action, or proceeding brought in any such court shall be conclusive
          and binding upon the Key Principal and may be enforced in any court to
          whose
          jurisdiction the Key Principal is subject, by a suit upon such judgment
          provided
          that service of process is effected upon the Key Principal in a manner
          specified
          in this Guaranty or as otherwise permitted by applicable law.

         

        Key
          Principal hereby irrevocably designates and appoints Corporation Service
          Company
          of Denver, Colorado, as its authorized agent to accept and acknowledge
          on its
          behalf service of any and all process that may be served in any suit, action,
          or
          proceeding instituted in connection with this Guaranty in any state or
          federal
          court sitting in the State of Colorado. If such agent shall cease so to
          act, Key
          Principal shall irrevocably designate and appoint without delay another
          such
          agent in the State of Colorado satisfactory to the Lender and shall promptly
          deliver to the Lender evidence in writing of such agent’s acceptance of such
          appointment and its agreement that such appointment shall be
          irrevocable.

         

        Key
          Principal hereby consents to process being served in any suit, action,
          or
          proceeding instituted in connection with this Guaranty by (a) the mailing
          of a
          copy thereof by certified mail, postage prepaid, return receipt requested,
          to it
          at its address designated herein and (b) serving a copy thereof upon the
          agent,
          if any, hereinabove designated and appointed by the Key Principal as the
          Key
          Principal’s agent for service of process. Key Principal irrevocably agrees that
          such service shall be deemed in every respect to be effective service of
          process
          in any such suit, action, or proceeding. Nothing in this Guaranty shall
          affect
          the right of the Lender to serve process in any manner otherwise permitted
          by
          law and nothing in this Guaranty will limit the right of the Lender otherwise
          to
          bring proceedings against the Key Principal, or any of them, in the courts
          of
          any other appropriate jurisdiction.

         

        
          
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        THIS
          GUARANTY AND THE OTHER LOAN DOCUMENTS REPRESENT THE FINAL AGREEMENT BETWEEN
          THE
          LENDER AND KEY PRINCIPAL AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR,
          CONTEMPORANEOUS OR SUBSEQUENT ORAL AGREEMENTS. KEY PRINCIPAL COVENANTS
          AND
          AGREES THAT THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE LENDER AND
          KEY
          PRINCIPAL AND ALL PRIOR OR CONTEMPORANEOUS AGREEMENTS, UNDERSTANDINGS,
          REPRESENTATIONS, AND STATEMENTS, ORAL OR WRITTEN, ARE MERGED INTO THIS
          GUARANTY
          AND THE OTHER LOAN DOCUMENTS. NEITHER THIS GUARANTY NOR ANY PROVISION HEREOF
          MAY
          BE WAIVED, MODIFIED, AMENDED, DISCHARGED, OR TERMINATED EXCEPT BY AN AGREEMENT
          IN WRITING SIGNED BY THE PARTY AGAINST WHICH THE ENFORCEMENT OF SUCH WAIVER,
          MODIFICATION, AMENDMENT, DISCHARGE, OR TERMINATION IS SOUGHT, AND THEN
          ONLY TO
          THE EXTENT SET FORTH IN SUCH AGREEMENT.

         

        [REMAINDER
          OF THIS PAGE IS INTENTIONALLY LEFT BLANK]

         

        
          
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        IN
          WITNESS
          WHEREOF, Key Principal has caused this Guaranty to be properly executed
          by its
          respective duly authorized representative
          as of the day and year first above written.

         

        
          	WITNESS:	 	 	KEY
                  PRINCIPAL:
	 	 	 	 
	 	 	 	
                  AMERICAN
                    RETIREMENT CORPORATION, a

                  Tennessee
                    corporation

                
	 	 	 	 
	 	 	 	 
	 	 	
                	
                  By:

                
	
                  

                  
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