Ex-10.56 First Amendment to Consolidated Amended and Restated Master Lease

EXHIBIT 10.56

FIRST AMENDMENT TO LOAN AGREEMENT

     This First Amendment to Loan Agreement (this “Amendment”), dated as of December 18, 2007, is by and among those certain entities set forth on Schedule 1 hereto, which are signatories hereto (such entities individually and collectively, the “Borrower”), and LASALLE BANK NATIONAL ASSOCIATION, a national banking association (together with its successors and assigns, the “Lender”).

RECITALS

     A. Borrower and Lender are parties to that certain Loan Agreement dated as of August 10, 2007 (as amended, restated, supplemented and otherwise modified, the “Loan Agreement”).

     B. The parties hereto desire to amend certain terms and provisions of the Loan Agreement on the terms and conditions set forth herein.

     NOW, THEREFORE, in consideration of the premises herein contained, and for other good and valuable consideration (the receipt, sufficiency and adequacy of which are hereby acknowledged), the parties hereto (intending to be legally bound) hereby agree as follows:

     1. Definitions. Terms capitalized herein and not otherwise defined herein shall have the meanings ascribed to such terms in the Loan Agreement, as amended hereby.

     2. Amendments to Loan Agreement. Subject to the terms and conditions contained herein, the Borrower and the Lender hereby amend the Loan Agreement as follows:

          (a) The definition of “Adjusted Leased Asset EBITDA” is hereby amended and restated in its entirety to read as follows:

“Adjusted Leased Asset EBITDA” means Adjusted EBITDA measured solely for all Facilities other than the Facilities listed on Schedule 1.1(g).”

          (b) Section 2.10 of the Loan Agreement is hereby amended as follows:

               i. The current last sentence of Section 2.10(b), which reads: “Prepayments of the Term Loan shall be applied against installments payable under the Term Note in the reverse order of maturity,” is hereby deleted.

               ii. The following sentence is hereby added as the new last sentence of Section 2.10(b): “All optional prepayments of the Term Loan made in accordance with this Section 2.10(b) shall, on a cumulative basis, be applied to and credited against each of the Mandatory Prepayments described in Section 2.15(a) and Section 2.15(b) in the order that such Mandatory Prepayments become due and are required to be made, until such Mandatory Prepayments are paid in full or the cumulative amount of optional prepayments of the Term Loan available to be so applied has been exhausted, whichever first occurs.”

          (c) Section 12.12 of the Loan Agreement is hereby amended to delete the contact information for Lender and substitute in lieu thereof the following new contact information:

LaSalle Bank National Association
135 South LaSalle Street
Chicago, Illinois 60603
Attention: Joshua Kochek
Telephone No.: 312 ###-###-####
Facsimile No.: 312 ###-###-####

          (d) The list of Schedules to the Loan Agreement is hereby amended to add a new reference to “Schedule 1.1(g) Facilities Excluded From Adjusted Leased Asset EBITDA.”

          (e) The Schedules to the Loan Agreement are hereby amended to include Schedule 1.1(g) attached hereto.

     3. Conditions Precedent. The amendment contained in Section 2 hereof is subject to, and contingent upon, the prior or contemporaneous satisfaction of the following conditions precedent:

          (a) The Borrower and Lender shall have executed and delivered to each other this Amendment, and

          (b) The Borrower shall have delivered to the Lender true, correct and complete copies of the resolutions of the Borrower Agent authorizing or ratifying the execution, delivery and performance by the Borrower of this Amendment.

     4. Reference to and Effect on the Loan Agreement.

          (a) Except as expressly provided herein, the Loan Agreement and all of the other Financing Agreements shall remain unmodified and continue in full force and effect and are hereby ratified and confirmed.

          (b) Except as expressly provided herein, the execution, delivery and effectiveness of this Amendment shall not operate as a waiver of: (i) any right, power or remedy of the Lender under the Loan Agreement or any of the other Financing Agreements, or (ii) any Default or Event of Default under the Loan Agreement.

     5. Costs, Expenses and Taxes. Without limiting the obligation of the Borrower to reimburse the Lender for costs, fees, disbursements and expenses incurred by the Lender as specified in the Loan Agreement, the Borrower agrees to pay on demand all reasonable costs, fees, disbursements and expenses of the Lender in connection with the preparation, execution and delivery of this Amendment and the other agreements, instruments and documents contemplated hereby, including, without limitation, reasonable attorneys’ fees and out-of-pocket expenses.

     6. Representations and Warranties of the Borrower. The Borrower hereby represents and warrants to the Lender, which representations and warranties shall survive the execution and delivery hereof, that on and as of the date hereof and after giving effect to this Amendment:

          (a) The Borrower has the requisite power and authority to execute, deliver and perform its obligations under this Amendment. This Amendment has been duly authorized by all necessary action of the Borrower. This Amendment constitutes the legal, valid and binding obligation of the Borrower, enforceable against the Borrower in accordance with its terms, subject to the effect of any applicable bankruptcy, insolvency, reorganization or similar law affecting creditors’ rights generally and general principles of equity;

          (b) The Borrower’s representations set forth in the Loan Agreement and in the Financing Agreements are true, correct and complete on and as of the date hereof; and

          (c) No Default or Event of Default has occurred and is continuing.

     7. Reference to Loan Agreement; No Waiver.

          (a) Upon the effectiveness of this Amendment, each reference in the Loan Agreement to “this Loan Agreement,” “this Agreement”, “hereunder,” “hereof,” “herein” or words of like import shall mean and be a reference to the Loan Agreement as amended hereby. The term “Financing Agreements” as defined in Section 1.1 of the Loan Agreement shall include (in addition to the Financing Agreements described in the Loan Agreement) this Amendment and any other agreements, instruments or other documents executed in connection herewith.

          (b) The Lender’s failure, at any time or times hereafter, to require strict performance by the Borrower of any provision or term of the Loan Agreement, this Amendment or the other Financing Agreements shall not waive, affect or diminish any right of the Lender hereafter to demand strict compliance and performance herewith or therewith. Any suspension or waiver by the Lender of a breach of this Amendment or any Event of Default under the Loan Agreement shall not, except as expressly set forth herein, suspend, waive or affect any other breach of this Amendment or any Event of Default under the Loan Agreement, whether the same is prior or subsequent thereto and whether of the same or of a different kind or character. None of the undertakings, agreements, warranties, covenants and representations of the Borrower contained in this Amendment, shall be deemed to have been suspended or waived by the Lender unless such suspension or waiver is: (i) in writing and signed by the Lender, and (ii) delivered to the Borrower. In no event shall the Lender’s execution and delivery of this Amendment establish a course of dealing among the Lender, the Borrower or any other obligor or in any other way obligate the Lender to hereafter provide any amendments or waivers with respect to the Loan Agreement. The terms and provisions of this Amendment shall be limited precisely as written and shall not be deemed: (A) to be a consent to a modification (except as expressly provided herein) or waiver of any other term or condition of the Loan Agreement or of any other Financing Agreement, or (B) to prejudice any right or remedy that the Lender may now have under or in connection with the Loan Agreement or any of the other Financing Agreements.

     8. Successors and Assigns. This Amendment shall be binding upon and inure to the benefit of the Lender and each of the other parties hereto and their respective successors and

assigns; provided, however, the Borrower may not assign this Amendment or any of the Borrower’s rights hereunder without the Lender’s prior written consent. Any prohibited assignment of this Amendment shall be absolutely null and void. This Amendment may only be amended or modified by a writing signed by the Lender and the Borrower.

     9. Severability. Wherever possible, each provision of this Amendment shall be interpreted in such a manner so as to be effective and valid under applicable law, but if any provision of this Amendment is held to be prohibited by or invalid under applicable law, such provision or provisions shall be ineffective only to the extent of such provision and invalidity, without invalidating the remainder of this Amendment.

     10. Governing Law. This Amendment shall be deemed to be a contract made under the laws of the State of Illinois, and the rights and obligations of the parties hereunder shall be construed in accordance with and be enforced and governed by the internal laws of the State of Illinois, without regard to conflict of law or choice of law principles.

     11. Counterparts; Facsimile or Other Electronic Transmission. This Amendment may be executed in one or more counterparts, each of which taken together shall constitute one and the same instrument. Delivery of an executed counterpart of this Amendment by telefacsimile or other electronic transmission shall be equally as effective as delivery of a manually executed counterpart of this Amendment. Any party delivering an executed counterpart of this Amendment by telefacsimile or other electronic transmission shall also deliver a manually executed counterpart of this Amendment, but the failure to deliver a manually executed counterpart shall not affect the validity, enforceability or binding effect of this Amendment.

***Signature Page Follows***

     IN WITNESS WHEREOF, the undersigned have caused this First Amendment to Loan Agreement to be duly executed and delivered as of the date first above written.

BY:		SENIOR CARE FLORIDA LEASING, LLC, its sole member

BY:		DIVERSICARE LEASING CORP., its sole member

BY:		SENIOR CARE FLORIDA LEASING, LLC, its sole member

BY:		DIVERSICARE LEASING CORP., its sole member

BY:		SENIOR CARE FLORIDA LEASING, LLC, its sole member

BY:		DIVERSICARE LEASING CORP., its sole member

BY:		DIVERSICARE LEASING CORP., its sole member

BY:		SENIOR CARE FLORIDA LEASING, LLC, its sole member

BY:		DIVERSICARE LEASING CORP., its sole member

BY:		DIVERSICARE LEASING CORP., its sole member

BY:		DIVERSICARE ASSISTED LIVING SERVICES NC, LLC, its sole member

BY:		DIVERSICARE ASSISTED LIVING SERVICES NC, LLC, its sole member

BY:		DIVERSICARE LEASING CORP., its sole member

BY:		DIVERSICARE LEASING CORP., its sole member

BY:		DIVERSICARE LEASING CORP., its sole member

BY:		DIVERSICARE LEASING CORP., its sole member

BY:		DIVERSICARE LEASING CORP., its sole member

BY:		DIVERSICARE LEASING CORP., its sole member

BY:		DIVERSICARE LEASING CORP., its sole member

BY:		DIVERSICARE LEASING CORP., its sole member

BY:		DIVERSICARE TEXAS I, LLC, its sole member

BY:		DIVERSICARE TEXAS I, LLC, its sole member

BY:		DIVERSICARE TEXAS I, LLC, its sole member

BY:		DIVERSICARE TEXAS I, LLC, its sole member

BY:		DIVERSICARE TEXAS I, LLC, its sole member

BY:		DIVERSICARE TEXAS I, LLC, its sole member

BY:		DIVERSICARE TEXAS I, LLC, its sole member

BY:		DIVERSICARE LEASING CORP., its sole member

SCHEDULE 1

     1. BORROWERS

Advocat Ancillary Services, Inc.
Advocat Finance, Inc.
Diversicare Management Services Co.
Advocat Distribution Services, Inc.
Diversicare Assisted Living Services, Inc.
Diversicare Assisted Living Services NC, LLC
Diversicare Leasing Corp.
Sterling Health Care Management, Inc.
Senior Care Cedar Hills, LLC
Senior Care Golfcrest, LLC
Senior Care Golfview, LLC
Senior Care Florida Leasing, LLC
Senior Care Southern Pines, LLC
Diversicare Afton Oaks, LLC
Diversicare Assisted Living Services NC I, LLC
Diversicare Assisted Living Services NC II, LLC
Diversicare Briarcliff, LLC
Diversicare Chisolm, LLC
Diversicare Hartford, LLC
Diversicare Hillcrest, LLC,
Diversicare Lampasas, LLC
Diversicare Pinedale, LLC
Diversicare Windsor House, LLC
Diversicare Yorktown, LLC
Diversicare Ballinger, LLC
Diversicare Doctors, LLC
Diversicare Estates, LLC
Diversicare Humble, LLC
Diversicare Katy, LLC
Diversicare Normandy Terrace, LLC
Diversicare Texas I, LLC
Diversicare Treemont, LLC
Diversicare Rose Terrace, LLC

SCHEDULE 1.1(g)

     2. FACILITIES EXCLUDED FROM ADJUSTED LEASED ASSET EBITDA

Alabama

Hartford Health Care
Windsor House

Arkansas

Newport Healthcare & Rehabilitation

Tennessee

Briarcliff Health Care Center

Texas

Afton Oaks Healthcare & Rehabilitation
Chisolm Trail Nursing & Rehabilitation Center
Hillcrest Manor Nursing & Rehabilitation Center