Unassociated Document


    
      
         

        Exhibit
          10.87
 

        PROMISSORY
          NOTE

        


        


        
          	
                  $6,050,000.00

                	 	
                  December
                    12, 2005

                


        

        


        


        FOR
          VALUE RECEIVED,
          on or
          before December 12,
          2015 (the
          "Maturity
          Date"),
          the
          undersigned, ASF OF GREEN HILLS, LLC, a Tennessee non-profit limited liability
          company ("Maker"),
          promises to pay to the order of AMERICAN RETIREMENT CORPORATION, a Tennessee
          corporation ("Payee";
          Payee,
          and any subsequent holder[s] hereof, being hereinafter referred to collectively
          as "Holder"),
          without grace, at the office of Payee at 111 Westwood Place, Suite 200,
          Brentwood, Tennessee, 37027, or at such other place as Holder may designate
          to
          Maker in writing from time to time, the principal sum of SIX MILLION FIFTY
          THOUSAND AND NO/100THS DOLLARS ($6,050,000.00), or such other amount as
          may be
          advanced here against and hereafter be outstanding hereunder, together
          with
          interest on the outstanding principal balance hereof from the date hereof
          at an
          annual rate equal to ten and one-half percent (10.50%) (the "Applicable
          Rate").
          Interest shall be calculated on the basis of a 360-day year and the actual
          number of days elapsed, to the extent permitted by applicable law. Capitalized
          terms used and not otherwise defined herein shall have the meanings assigned
          thereto in the Loan Agreement (as defined below).

        


        Beginning
          on the
          first
          (1st)
          day of
          the first (1st)
          month after
          which Maker achieves a Debt Service Coverage Ratio greater than or equal
          to 1.1
          to 1.0, and, provided that Maker thereafter maintains a Debt Service Coverage
          Ratio greater than or equal to 1.1 to 1.0, continuing on the first
          (1st)
          day of
          each succeeding month until the Maturity Date, Maker shall make payments
          of
          interest as required by Section
          2.2
          of the
          Loan Agreement.

        


        Notwithstanding
          anything in this Note that may be to the contrary, the entire outstanding
          principal balance hereof, together with all accrued and unpaid interest,
          shall
          be immediately due and payable in full on the Maturity Date.

        


        All
          payments in respect of the indebtedness evidenced hereby shall be made
          in
          collected funds, and shall be applied to principal, accrued interest and
          charges
          and expenses owing under or in connection with this Note in such order
          as Holder
          elects, except that payments shall be applied to accrued interest before
          principal and shall also be applied as required by Section
          2.2
          of the
          Loan Agreement.

        


        Any
          advance by Payee to Maker that is not evidenced by another instrument or
          agreement between the parties shall be conclusively presumed to have been
          made
          hereunder when such advance is either (1) deposited or credited to an
          account of Maker by Payee, notwithstanding that such advance was requested,
          orally or in writing, by someone other than Maker or that someone other
          than
          Maker is authorized to draw on such account and may or does withdraw the
          whole
          or part of such advance, or (2) made in accordance with the oral or written
          instructions of Maker. The entire balance of all advances hereunder that
          may be
          outstanding from time to time shall constitute a single indebtedness, and
          no
          single advance increasing the outstanding balance hereof shall itself be
          considered a separate loan, but rather an increase in the aggregate outstanding
          balance of the indebtedness evidenced hereby.

        


        
          
            
            

          

          
            
            

            
              

            

          

          
            
            

          

        

         

        The
          indebtedness evidenced hereby may not be prepaid in whole or in
          part.

        


        In
          the
          absence of a default or event of default under the Loan Agreement or under
          any
          other instrument, document or agreement now or hereafter further evidencing,
          securing or otherwise relating to the indebtedness evidenced hereby, Maker
          may
          borrow on a non-revolving basis up to the maximum amount of this Note in
          accordance with the terms, conditions and provisions of the Loan Agreement.
          Amounts borrowed by Maker and repaid to Holder may not thereafter be reborrowed
          by Maker.

        


        Reference
          is here made to that certain Construction Loan Agreement of even date herewith,
          by and between Maker and Payee (as the same heretofore may have been or
          hereafter may be amended, restated, supplemented, extended, renewed, replaced
          or
          otherwise modified from time to time, herein referred to as the "Loan
          Agreement").
          The
          indebtedness evidenced hereby is further evidenced and secured as set forth
          in
          the Loan Agreement and the Loan Documents.

        


        Time
          is of
          the essence of this Note. It is hereby expressly agreed that if any default
          shall occur in the payment of interest when due as stipulated above, or
          if any
          default or event of default shall occur under the Loan Agreement or under
          any
          other instrument, document or agreement now or hereafter further evidencing,
          securing or otherwise relating to the indebtedness evidenced hereby, and
          the
          same shall not be cured under any such document; then, and in such event,
          the
          entire outstanding principal balance of the indebtedness evidenced hereby,
          together with any other sums advanced hereunder or under any other instrument
          or
          document now or hereafter evidencing, securing or in any way relating to
          the
          indebtedness evidenced hereby, together with all unpaid interest accrued
          thereon, shall, at the option of Holder and without notice to Maker, at
          once
          become due and payable and may be collected forthwith, regardless of the
          stipulated date of maturity. Upon the occurrence of any default as set
          forth
          herein, at the option of Holder and without notice to Maker, all accrued
          and
          unpaid interest, if any, shall be added to the outstanding principal balance
          hereof, and the entire outstanding principal balance, as so adjusted, shall
          bear
          interest thereafter until paid at an annual rate equal to Applicable Rate
          plus
          five
          percent (5.00%), regardless of whether the maturity of the indebtedness
          evidenced hereby has been accelerated as herein provided. All such interest
          shall be paid at the time of and as a condition precedent to the curing
          of any
          such default.

        


        To
          the
          extent permitted by applicable law, Maker shall pay to Holder a late charge
          equal to five percent (5.00%) of any payment hereunder that is not received
          by
          Holder within ten (10) days of the date on which it is due (minimum $10.00,
          maximum $250.00), in order to cover the additional expenses incident to
          the
          handling and processing of delinquent payments; provided,
          however,
          that no
          late charge will be imposed on any payment made on time and in full solely
          by
          reason of any previously accrued and unpaid late charge; and provided
          further
          that
          nothing in this paragraph shall be deemed to waive any other right or remedy
          of
          Holder by reason of Maker's failure to make payments when due
          hereunder.

        


        
          
            2

          

          
            
            

            
              

            

          

          
            
            

          

        

         

        In
          the
          event this Note is placed in the hands of an attorney for collection or
          for
          enforcement or protection of the security, or if Holder incurs any costs
          incident to the collection of the indebtedness evidenced hereby or the
          enforcement or protection of the security, Maker and each indorser, surety,
          guarantor or other person now or hereafter liable for payment of the
          indebtedness evidenced hereby or any portion thereof (individually an
          "Obligor"
          and
          individually and collectively the "Obligors")
          agree
          to pay a reasonable attorney's fee, all court and other costs, and the
          reasonable costs of any other collection efforts.

        


        In
          addition to all liens upon, and rights of setoff against, any moneys, securities
          or other property of any of the Obligors given to Holder by law, to the
          extent
          permitted by applicable law Holder shall have and is hereby granted a lien
          upon,
          right of setoff against and continuing security interest in all moneys,
          securities and other property of any of the Obligors now or hereafter in
          the
          possession of, or on deposit with, Holder, whether held in a general or
          special
          account or deposit, for safekeeping or otherwise. Every such lien, security
          interest and right of setoff may be exercised without demand upon or notice
          to
          any Obligor, and Holder shall have no liability with respect to any checks
          or
          other items of any Obligor that may be returned or other funds transfers
          by any
          Obligor that may not be made due to insufficient funds thereafter.

        


        Presentment
          for payment, demand, protest and notice of demand, protest and nonpayment
          are
          hereby waived by Maker and all other Obligors. No failure or delay on the
          part
          of Holder in exercising any right, power or privilege under this Note shall
          operate as a waiver thereof, nor shall a single or partial exercise thereof
          preclude any other or further exercise or the exercise of any other right,
          power
          or privilege. Unless otherwise specifically agreed by Holder in writing,
          the
          liability of Maker and all other Obligors shall not be affected by (1) any
          renewal hereof or other extension of the time for payment of the indebtedness
          evidenced hereby or any amount due in respect thereof, (2) the release of
          all or any part of any collateral now or hereafter securing the payment
          of the
          indebtedness evidenced hereby or any portion thereof, or (3) the release of
          or resort to any Obligor. No modification, amendment, waiver or discharge
          of any
          provision of this Note shall be effective unless in writing and signed
          by the
          party against whom enforcement of any modification, amendment, waiver or
          discharge is sought, and then the same shall be effective only in the specific
          instance and for the purpose for which given. No notice to or demand on
          any
          Obligor in any case shall entitle any Obligor to any other or further notice
          or
          demand in the same, similar or other circumstances.

        


        To
          the
          extent permitted by applicable law, Maker hereby waives and renounces for
          itself
          and its successors and assigns, all rights to the benefits of any appraisement,
          exception and homestead now provided, or that hereafter may be provided,
          by the
          Constitution and laws of the United States of America and of any state
          thereof
          in and to all of its property, real and personal, against the enforcement
          and
          collection of the indebtedness and other obligations evidenced by this
          Note.

        


        The
          indebtedness and other obligations evidenced by this Note are further evidenced
          and/or secured by (1) the Loan Agreement, (2) that certain Deed of Trust,
          Assignment, Security Agreement and Fixture Filing of even date herewith
          from
          Maker to Payee, granting Payee a lien on certain real property and improvements
          located in Davidson County, Tennessee, and (3) certain other instruments
          and documents, as more particularly described in the Loan
          Agreement.

         

        
          
            3

          

          
            
            

            
              

            

          

          
            
            

          

        

         

        All
          agreements herein made are expressly limited so that in no event whatsoever,
          whether by reason of advancement of proceeds hereof, acceleration of maturity
          of
          the unpaid balance hereof or otherwise, shall the interest and loan charges
          agreed to be paid to Holder for the use of the money advanced or to be
          advanced
          hereunder exceed the maximum amounts collectible under applicable laws
          in effect
          from time to time. If for any reason whatsoever the interest or loan charges
          paid or contracted to be paid in respect of the indebtedness evidenced
          hereby
          shall exceed the maximum amounts collectible under applicable laws in effect
          from time to time, then, ipso
          facto,
          the
          obligation to pay such interest and/or loan charges shall be reduced to
          the
          maximum amounts collectible under applicable laws in effect from time to
          time,
          and any amounts collected by Holder that exceed such maximum amounts shall
          be
          applied to the reduction of the principal balance remaining unpaid hereunder
          and/or refunded to Maker so that at no time shall the interest or loan
          charges
          paid or payable in respect of the indebtedness evidenced hereby exceed
          the
          maximum amounts permitted from time to time by applicable law. This provision
          shall control every other provision in any and all other agreements and
          instruments now existing or hereafter arising between Maker and Holder
          with
          respect to the indebtedness evidenced hereby.

        


        Holder
          may
          not grant any participation in the indebtedness evidenced by this Note
          before
          December 12,
          2010;
provided,
          however,
          that
          Holder may collaterally assign and grant a security interest in its right,
          title
          and interest in, to and under this Note, the indebtedness evidenced hereby
          and
          the Loan Documents to obtain and secure one or more loans from one or more
          third-party lenders. Maker understands that beginning on December 12,
          2010,
          Holder may from time to time enter into a participation agreement or agreements
          with one or more participants pursuant to which such participant or participants
          shall be given participations in the indebtedness evidenced hereby, and
          that
          such participants from time to time similarly may grant to other participants
          sub-participations in the indebtedness evidenced hereby. Maker agrees that
          any
          participant and any subparticipant may exercise any and all rights of banker's
          lien or setoff, whether arising by operation of law or given to Holder
          by the
          provisions of this Note, with respect to Maker as fully as if such participant
          or subparticipant had extended credit directly to Maker. For purposes of
          this
          paragraph only, Maker shall be deemed to be directly obligated to each
          participant or subparticipant in the amount of its participating interest
          in the
          principal of, and interest on, the indebtedness evidenced hereby.

        


        Any
          provision of this Note that is prohibited or unenforceable in any jurisdiction
          shall, as to such jurisdiction, be ineffective to the extent of such prohibition
          or unenforceability without invalidating the remaining provisions hereof
          or
          affecting the validity or enforceability of such provision in any other
          jurisdiction.

        


        This
          Note
          has been negotiated, executed and delivered in the State of Tennessee,
          and is
          intended as a contract under and shall be construed and enforceable in
          accordance with the laws of said state, except to the extent that federal
          law
          may govern the maximum rate of interest from time to time allowed to be
          charged
          in respect of the indebtedness evidenced hereby.

         

        
          
            4

          

          
            
            

            
              

            

          

          
            
            

          

        

         

        As
          used
          herein, the terms "Maker" and "Holder" shall be deemed to include their
          respective successors, legal representatives and assigns, whether by voluntary
          action of the parties or by operation of law. In the event that more than
          one
          person, firm or entity is a maker hereunder, then all references to "Maker"
          shall be deemed to refer equally to each of said persons, firms or entities,
          all
          of whom shall be jointly and severally liable for all of the obligations
          of
          Maker hereunder.

        


        Notwithstanding
          any provision hereof to the contrary, no incorporator, member, director
          or
          officer, as such past, present or future, of Maker shall be personally
          liable
          for the payment of the indebtedness evidenced by this Note.

        


        [Signature
          Page Follows]

         

        
          
            5

          

          
            
            

            
              

            

          

          
            
            

          

        

         

        IN
          WITNESS WHEREOF,
          the
          undersigned Maker has caused this Note to be executed by its duly authorized
          officer as of the date first above written.

         

        
          	 	 	 
	 	MAKER:
	 
 	ASF
                  OF GREEN
                  HILLS, LLC 
	 	 
	 	By:  	
                  American
                    Seniors Foundation, Inc., its sole

                  member

                
	 	 	 
	 	 	 
	 	 	By:
	 	 	
                  
                    

                  

                  Name:
                    

                  
Title: 

                  

                


ENDORSEMENT

        


        As
          collateral security, pay to the order of Bank of America, N.A.

         

        
          	 	 	 
	 	AMERICAN
                  RETIREMENT CORPORATION
	 
 	 
 	 
 
	 	By:  	 
	 	
                  

                
	 	Name:
                  
                  
Title:
                  
                  

                




              

        
          
            6