SECURITY AGREEMENT

THIS SECURITY AGREEMENT (this “Agreement”) is entered into as of February 27,
2009, among each of the Domestic Subsidiaries of Brookdale Senior Living Inc., a
Delaware corporation (the “Borrower”) from time to time party hereto
(individually an “Obligor” and collectively the “Obligors”) and BANK OF AMERICA,
N.A., in its capacity as administrative agent (in such capacity, the
“Administrative Agent”) for the holders of the Secured Obligations (defined
below).

RECITALS

WHEREAS, pursuant to that certain Second Amended and Restated Credit Agreement
dated as of the date hereof (as amended, modified, extended, renewed or replaced
from time to time, the “Credit Agreement”) among the Borrower, the Guarantors
identified therein, the Lenders identified therein and the Administrative Agent,
the Lenders have agreed to make Loans and issue Letters of Credit upon the terms
and subject to the conditions set forth therein; and

WHEREAS, this Agreement is required by the terms of the Credit Agreement.

NOW, THEREFORE, in consideration of these premises and other good and valuable
consideration, the receipt and sufficiency of which is hereby acknowledged, the
parties hereto agree as follows:

1.           Definitions.

(a)           Capitalized terms used and not otherwise defined herein shall have
the meanings ascribed to such terms in the Credit Agreement, and the following
terms shall have the meanings set forth in the UCC (defined below):  Accession,
As-Extracted Collateral, Consumer Goods, Equipment, Farm Products, Fixtures,
Goods, Inventory, Manufactured Home, Money, Proceeds, Standing Timber.

(b)           In addition, the following terms shall have the meanings set forth
below:

“Collateral” has the meaning provided in Section 2 hereof.
 
“Mortgaged Properties” means, collectively, the Properties and any other real
property mortgaged in favor of the Administrative Agent to secure the
Obligations, and “Mortgaged Property” means any of them, individually.
 
“Secured Obligations” means, without duplication, (a) all Obligations now
existing or hereafter arising pursuant to the Loan Documents and (b) all costs
and expenses incurred in connection with enforcement and collection of the
Obligations, including the reasonable fees, charges and disbursements of
counsel.
 

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“UCC” means the Uniform Commercial Code as in effect from time to time in the
state of New York except as such term may be used in connection with the
perfection of the Collateral and then the applicable jurisdiction with respect
to such affected Collateral shall apply.

2.           Grant of Security Interest in the Collateral.  To secure the prompt
payment and performance in full when due, whether by lapse of time,
acceleration, mandatory prepayment or otherwise, of the Secured Obligations,
each Obligor hereby grants to the Administrative Agent, for the benefit of the
holders of the Secured Obligations, a continuing security interest in, and a
right to set off against, any and all right, title and interest of such Obligor
in and to all of the following, whether now owned or existing or owned,
acquired, or arising hereafter (collectively, the “Collateral”):

(a)           all Equipment located at the Mortgaged Properties;

(b)           all Fixtures located at the Mortgaged Properties;

(c)           all Goods located at the Mortgaged Properties;

(d)           all Inventory located at the Mortgaged Properties;

(e)           all books, records, ledger cards, files, correspondence, computer
programs, tapes, disks, and related data processing software (owned by such
Obligor or in which it has an interest) that at any time evidence or contain
information relating to (a) – (d) and (f) of this Section 2 or are otherwise
necessary or helpful in the collection thereof or realization thereupon; and

(f)           all Accessions and all Proceeds of any and all of the foregoing.

Notwithstanding the foregoing, the term “Collateral” shall not include any
property to the extent that the grant of a security interest therein constitutes
a breach or default under or results in the termination of or requires any
consent not obtained under, any contract, license, agreement, instrument or
other document, except to the extent that the term in such contract, license,
agreement, instrument or other document providing for such prohibition, breach,
default or termination or requiring such consent is ineffective under applicable
Law (including, without limitation, Sections 9-406, 9- 407, 9-408 or 9-409 of
the UCC (or any successor provision or provisions) of any relevant jurisdiction
or any other applicable Law or principles of equity).

The Obligors and the Administrative Agent, on behalf of the Lenders, hereby
acknowledge and agree that the security interests created hereby in the
Collateral constitute continuing collateral security for all of the Secured
Obligations, whether now existing or hereafter arising.

3.           Representations and Warranties.  Each Obligor hereby represents and
warrants to the Administrative Agent, for the benefit of the holders of the
Secured Obligations, that:
 
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(a)           Ownership.  Each Obligor owns or has rights in its Collateral and
has the right to pledge, sell, assign or transfer the same.

(b)           Chief Executive Office; Books & Records; Legal Name; State of
Organization.  As of the Closing Date, each Obligor’s chief executive office and
principal place of business are (and for the prior four months have been)
located at the locations set forth on Schedule 3(b) attached hereto, and, as of
the Closing Date, each Obligor keeps its books and records at such applicable
locations.  As of the Closing Date, each Obligor’s exact legal name is as shown
in this Agreement and its location (within the meaning of Section 9-307 of the
UCC) is (and for the prior four months has been) its state of organization as
shown in this Agreement.  As of the Closing Date, no Obligor has in the past
four months changed its name, been party to a merger, consolidation or other
change in structure not disclosed on Schedule 3(b) attached hereto.

(c)           Security Interest/Priority.  This Agreement creates a valid
security interest in favor of the Administrative Agent, for the benefit of the
holders of the Secured Obligations, in the Collateral of such Obligor and, when
properly perfected by filing, shall constitute a valid and perfected, first
priority security interest in such Collateral, to the extent such security
interest can be perfected by filing under the UCC, free and clear of all Liens
except for Permitted Liens.  

(d)           Types of Collateral.  None of the Collateral consists of, or is
the Proceeds of, As-Extracted Collateral, Consumer Goods, Farm Products,
Manufactured Homes or Standing Timber.

(e)           Equipment and Inventory.  With respect to any Equipment and/or
Inventory of an Obligor, each such Obligor has exclusive possession and Control
of such Equipment and Inventory of such Obligor except for (i) Equipment leased
by such Obligor as a lessee or (ii) Equipment or Inventory in transit with
common carriers.  No Inventory of an Obligor is held by a Person other than an
Obligor pursuant to consignment, sale or return, sale on approval or similar
arrangement.

(f)           Mergers, Etc.  Other than as set forth on Schedule 3(b) hereto, no
Obligor has been party to a merger, consolidation or other change in structure
in the prior five years.

(g)           Consents; Etc.  Except for (i) the filing or recording of UCC
financing statements, and (ii) consents, authorizations, filings or other
actions which have been obtained or made, no consent or authorization of, filing
with, or other act by or in respect of, any arbitrator or Governmental Authority
and no consent of any other Person (including, without limitation, any
stockholder, member or creditor of such Obligor), is required for (A) the grant
by such Obligor of the security interest in the Collateral granted hereby or for
the execution, delivery or performance of this Agreement by such Obligor,
(B) the perfection of such security interest (to the extent such security
interest can be perfected by filing under the UCC or the granting of Control) or
(C) the exercise by the Administrative Agent or the holders of the Secured
Obligations of the rights and remedies provided for in this Agreement.
 
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4.           Covenants. Each Obligor covenants that until such time as the
Secured Obligations (excluding Secured Obligations solely with respect to Cash
Collateralized Letters of Credit) arising under the Loan Documents have been
paid in full and the Commitments and any Letters of Credit (excluding any Cash
Collateralized Letters of Credit) have expired or been terminated, such Obligor
shall:

(a)           Filing of Financing Statements, Notices, etc.  Authorize, and
hereby does authorize, the Administrative Agent to prepare and file such
financing statements (including continuation statements) or amendments thereof
or supplements thereto or other instruments as the Administrative Agent may from
time to time deem necessary or appropriate in order to perfect and maintain the
security interest granted hereunder in accordance with the UCC.  Such financing
statements may describe the collateral in the same manner as described in this
Agreement or may contain an indication or description of collateral that
describes such property in any other manner as the Administrative Agent may
determine is necessary, advisable or prudent to ensure the perfection of the
security interests in the collateral granted to the Administrative Agent in
connection herewith.  Each Obligor shall also execute and deliver to the
Administrative Agent such agreements, assignments or instruments (including
affidavits, notices, reaffirmations and amendments and restatements of existing
documents, as the Administrative Agent may reasonably request) and do all such
other things as the Administrative Agent may reasonably deem necessary or
appropriate (i) to assure to the Administrative Agent its security interests
hereunder are perfected and maintained, including such instruments as the
Administrative Agent may from time to time reasonably request in order to
perfect and maintain the security interests granted hereunder in accordance with
the UCC, (ii) to consummate the transactions contemplated hereby and (iii) to
otherwise protect and assure the Administrative Agent of its rights and
interests hereunder.  Furthermore, each Obligor also hereby irrevocably makes,
constitutes and appoints the Administrative Agent, its nominee or any other
person whom the Administrative Agent may designate, as such Obligor’s attorney
in fact with full power and for the limited purpose to sign in the name of such
Obligor any financing statements, or amendments and supplements to financing
statements, renewal financing statements, notices or any similar documents which
in the Administrative Agent’s reasonable discretion would be necessary or
appropriate in order to perfect and maintain perfection of the security
interests granted hereunder, such power, being coupled with an interest, being
and remaining irrevocable until such time as the Secured Obligations arising
under the Loan Documents have been paid in full and the Commitments have expired
or been terminated.  In the event for any reason the Law of any jurisdiction
other than New York becomes or is applicable to the Collateral of any Obligor or
any part thereof, or to any of the Secured Obligations, such Obligor agrees to
execute and deliver all such instruments and to do all such other things as the
Administrative Agent in its sole discretion reasonably deems necessary or
appropriate to preserve, protect and enforce the security interest of the
Administrative Agent under the Law of such other jurisdiction (and, if an
Obligor shall fail to do so promptly upon the request of the Administrative
Agent, then the Administrative Agent may execute any and all such requested
documents on behalf of such Obligor pursuant to the power of attorney granted
hereinabove).
 
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(b)           Defense of Title.  Warrant and defend title to and ownership of or
rights in the Collateral (except as otherwise permitted under the Credit
Agreement and the other Loan Documents) of such Obligor at its own expense
against the claims and demands of all other parties claiming an interest
therein, keep the Collateral free from all Liens, except for Liens permitted by
the Credit Agreement and not sell, exchange, transfer, assign, lease or
otherwise dispose of the Collateral of such Obligor or any interest therein,
except as permitted under the Credit Agreement and the other Loan Documents.

(c)           Collateral Held by Warehouseman, Bailee, etc.  If any Collateral
is at any time in the possession or control of a warehouseman, bailee or any
agent or processor of such Obligor, such Obligor shall notify the Administrative
Agent of the same and if the Administrative Agent so requests (i) notify such
Person in writing of the Administrative Agent’s security interest therein, (ii)
instruct such Person to hold all such Collateral for the Administrative Agent’s
account and subject to the Administrative Agent’s instructions and (iii) use
reasonable best efforts to obtain a written acknowledgment from such Person that
it is holding such Collateral for the benefit of the Administrative Agent.

(d)           Nature of Collateral.  At all times maintain the Collateral as
personal property and not affix any of the Collateral to any real property in a
manner which would change its nature from personal property to real property or
a Fixture to real property, unless the Administrative Agent shall have a
perfected Lien on such Fixture or real property.

(e)           Insurance. Insure, repair and replace the Collateral of such
Obligor as set forth in the Credit Agreement.  All insurance proceeds paid in
connection with any insurance providing coverage with respect to any Collateral
shall be subject to the security interests of the Administrative Agent hereunder
and shall be paid or applied in accordance with the terms of the Credit
Agreement.

5.           Authorization to File Financing Statements.  Each Obligor hereby
authorizes the Administrative Agent to prepare and file such financing
statements (including continuation statements) or amendments thereof or
supplements thereto or other instruments as the Administrative Agent may from
time to time deem necessary or appropriate in order to perfect and maintain the
security interests granted hereunder in accordance with the UCC.  Such financing
statements may describe the collateral in the same manner as described in this
Agreement or may contain an indication or description of collateral that
describes such property in any other manner as the Administrative Agent may
determine is necessary, advisable or prudent to ensure the perfection of the
security interests in the collateral granted to the Administrative Agent in
connection herewith.

6.           Advances.  On failure of any Obligor to perform any of the
covenants and agreements contained herein, the Administrative Agent may, at its
sole option and in its sole discretion, perform the same and in so doing may
expend such sums as the Administrative Agent may reasonably deem advisable in
the performance thereof, including, without limitation, the payment of any
taxes, a payment to obtain a release of a Lien or potential Lien, expenditures
made in defending against any adverse claim and all other expenditures which the
Administrative Agent
 
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may make for the protection of the security hereof or which may be compelled to
make by operation of Law.  All such sums and amounts so expended shall be
repayable by the Obligors on a joint and several basis promptly upon timely
notice thereof and demand therefor, shall constitute additional Secured
Obligations and shall bear interest from the date said amounts are expended at
the Default Rate.  No such performance of any covenant or agreement by the
Administrative Agent on behalf of any Obligor, and no such advance or
expenditure therefor, shall relieve the Obligors of any Default or Event of
Default.  The Administrative Agent may make any payment hereby authorized in
accordance with any bill, statement or estimate procured from the appropriate
public office or holder of the claim to be discharged without inquiry into the
accuracy of such bill, statement or estimate or into the validity of any tax
assessment, sale, forfeiture, tax lien, title or claim except to the extent such
payment is being contested in good faith by an Obligor in appropriate
proceedings and against which adequate reserves are being maintained in
accordance with GAAP.

7.           Remedies.

(a)           General Remedies.  Upon the occurrence of an Event of Default and
during continuation thereof, the Administrative Agent shall have, in addition to
the rights and remedies provided herein, in the Loan Documents, in any other
documents relating to the Secured Obligations, or by Law (including, but not
limited to, levy of attachment, garnishment and the rights and remedies set
forth in the UCC of the jurisdiction applicable to the affected Collateral), the
rights and remedies of a secured party under the UCC (regardless of whether the
UCC is the law of the jurisdiction where the rights and remedies are asserted
and regardless of whether the UCC applies to the affected Collateral), and
further, the Administrative Agent may, with or without judicial process or the
aid and assistance of others, (i) enter on any Mortgaged Property on which any
of the Collateral may be located and, without resistance or interference by the
Obligors, take possession of the Collateral, (ii) dispose of any Collateral on
any such Mortgaged Property, (iii) require the Obligors to assemble and make
available to the Administrative Agent at the expense of the Obligors any
Collateral at any place and time designated by the Administrative Agent which is
reasonably convenient to both parties, (iv) remove any Collateral from any such
premises for the purpose of effecting sale or other disposition thereof, and/or
(v) without demand and without advertisement, notice, hearing or process of law,
all of which each of the Obligors hereby waives to the fullest extent permitted
by Law, at any place and time or times, sell and deliver any or all Collateral
held by or for it at public or private sale, at any exchange or broker’s board
or elsewhere, by one or more contracts, in one or more parcels, for Money, upon
credit or otherwise, at such prices and upon such terms as the Administrative
Agent deems advisable, in its sole discretion (subject to any and all mandatory
legal requirements).  Each Obligor acknowledges that any such private sale may
be at prices and on terms less favorable to the seller than the prices and other
terms which might have been obtained at a public sale and, notwithstanding the
foregoing, agrees that such private sale shall be deemed to have been made in a
commercially reasonable manner.  Neither the Administrative Agent’s compliance
with applicable Law nor its disclaimer of warranties relating to the Collateral
shall be considered to adversely affect the commercial reasonableness of any
sale.  To the extent the rights of notice cannot be legally waived hereunder,
each Obligor agrees that any requirement of reasonable notice shall be met if
such notice, specifying the place of any public sale or the time after which any
private
 
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sale is to be made, is personally served on or mailed, postage prepaid, to the
Borrower in accordance with the notice provisions of the Credit Agreement at
least 10 days before the time of sale or other event giving rise to the
requirement of such notice.  The Administrative Agent may adjourn any public or
private sale from time to time by announcement at the time and place fixed
therefor, and such sale may, without further notice, be made at the time and
place to which it was so adjourned.  The Administrative Agent shall not be
obligated to make any sale or other disposition of the Collateral regardless of
notice having been given.  To the extent permitted by applicable Law, any holder
of Secured Obligations may be a purchaser at any such sale.  To the extent
permitted by applicable Law, each of the Obligors hereby waives all of its
rights of redemption with respect to any such sale.  Subject to the provisions
of applicable Law, the Administrative Agent may postpone or cause the
postponement of the sale of all or any portion of the Collateral by announcement
at the time and place of such sale, and such sale may, without further notice,
to the extent permitted by Law, be made at the time and place to which the sale
was postponed, or the Administrative Agent may further postpone such sale by
announcement made at such time and place.

(c)           Access.  In addition to the rights and remedies hereunder, upon
the occurrence of an Event of Default and during the continuance thereof, the
Administrative Agent shall have the right to enter and remain upon the various
premises of the Obligors without cost or charge to the Administrative Agent, and
use the same, together with materials, supplies, books and records of the
Obligors for the purpose of collecting and liquidating the Collateral, or for
preparing for sale and conducting the sale of the Collateral, whether by
foreclosure, auction or otherwise.  In addition, the Administrative Agent may
remove Collateral, or any part thereof, from such premises and/or any records
with respect thereto, in order to effectively collect or liquidate such
Collateral.

(d)           Nonexclusive Nature of Remedies.  Failure by the Administrative
Agent or the holders of the Secured Obligations to exercise any right, remedy or
option under this Agreement, any other Loan Document, any other document
relating to the Secured Obligations, or as provided by Law, or any delay by the
Administrative Agent or the holders of the Secured Obligations in exercising the
same, shall not operate as a waiver of any such right, remedy or option.  No
waiver hereunder shall be effective unless it is in writing, signed by the party
against whom such waiver is sought to be enforced and then only to the extent
specifically stated, which in the case of the Administrative Agent or the
holders of the Secured Obligations shall only be granted as provided herein.  To
the extent permitted by Law, neither the Administrative Agent, the holders of
the Secured Obligations, nor any party acting as attorney for the Administrative
Agent or the holders of the Secured Obligations, shall be liable hereunder for
any acts or omissions or for any error of judgment or mistake of fact or law
other than their gross negligence or willful misconduct hereunder.  The rights
and remedies of the Administrative Agent and the holders of the Secured
Obligations under this Agreement shall be cumulative and not exclusive of any
other right or remedy which the Administrative Agent or the holders of the
Secured Obligations may have.
 
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(e)           Retention of Collateral.  In addition to the rights and remedies
hereunder, the Administrative Agent may, in compliance with Sections 9-620 and
9-621 of the UCC or otherwise complying with the requirements of applicable Law
of the relevant jurisdiction, accept or retain the Collateral in satisfaction of
the Secured Obligations.  Unless and until the Administrative Agent shall have
provided such notices, however, the Administrative Agent shall not be deemed to
have retained any Collateral in satisfaction of any Secured Obligations for any
reason.

(f)           Deficiency.  In the event that the proceeds of any sale,
collection or realization are insufficient to pay all amounts to which the
Administrative Agent or the holders of the Secured Obligations are legally
entitled, the Obligors shall be jointly and severally liable for the deficiency,
together with interest thereon at the Default Rate, together with the costs of
collection and the fees, charges and disbursements of counsel.  Any surplus
remaining after the full payment and satisfaction of the Secured Obligations
shall be returned to the Obligors or to whomsoever a court of competent
jurisdiction shall determine to be entitled thereto.

(g)           Indemnification.  Each Obligor hereby agrees to indemnify the
Administrative Agent and the Lenders in accordance with the terms of the Credit
Agreement, with respect to the actions taken by the Administrative Agent in
accordance with the foregoing.  The foregoing indemnity shall survive the
repayment of the Secured Obligations.

8.           Rights of the Administrative Agent.

(a)           Power of Attorney.  In addition to other powers of attorney
contained herein, each Obligor hereby designates and appoints the Administrative
Agent, on behalf of the holders of the Secured Obligations, and each of its
designees or agents, as attorney-in-fact of such Obligor, irrevocably and with
power of substitution, with authority to take any or all of the following
actions upon the occurrence and during the continuance of an Event of Default:

(i)           to demand, collect, settle, compromise, adjust, give discharges
and releases, all as the Administrative Agent may reasonably determine;

(ii)          to commence and prosecute any actions at any court for the
purposes of collecting any Collateral and enforcing any other right in respect
thereof;

(iii)         to defend, settle or compromise any action brought and, in
connection therewith, give such discharge or release as the Administrative Agent
may deem reasonably appropriate;

(iv)         receive, open and dispose of mail addressed to an Obligor and
endorse checks, notes, drafts, acceptances, money orders, bills of lading,
warehouse receipts or other instruments or documents evidencing payment,
shipment or storage
 
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of the goods giving rise to the Collateral of such Obligor on behalf of and in
the name of such Obligor, or securing, or relating to such Collateral;

(v)         sell, assign, transfer, make any agreement in respect of, or
otherwise deal with or exercise rights in respect of, any Collateral or the
goods or services which have given rise thereto, as fully and completely as
though the Administrative Agent were the absolute owner thereof for all
purposes;

(vi)        adjust and settle claims under any insurance policy relating
thereto;

(vii)       execute and deliver all assignments, conveyances, statements,
financing statements, renewal financing statements, security agreements,
affidavits, notices and other agreements, instruments and documents that the
Administrative Agent may determine necessary in order to perfect and maintain
the security interests and liens granted in this Agreement and in order to fully
consummate all of the transactions contemplated therein;

(viii)      institute any foreclosure proceedings that the Administrative Agent
may deem appropriate;

(ix)         to sign and endorse any drafts, assignments, proxies, stock powers,
verifications, notices and other documents relating to the Collateral;

(x)          to pay or discharge taxes, liens, security interests or other
encumbrances levied or placed on or threatened against the Collateral;

(xi)         to direct any parties liable for any payment in connection with any
of the Collateral to make payment of any and all monies due and to become due
thereunder directly to the Administrative Agent or as the Administrative Agent
shall direct;

(xii)        to receive payment of and receipt for any and all monies, claims,
and other amounts due and to become due in respect of or arising out of any
Collateral; and

(xiii)       do and perform all such other acts and things as the Administrative
Agent may reasonably deem to be necessary, proper or convenient in connection
with the Collateral.
 
This power of attorney is a power coupled with an interest and shall be
irrevocable until such time as the Secured Obligations (excluding Secured
Obligations solely with respect to Cash Collateralized Letters of Credit)
arising under the Loan Documents have been paid in full and the Commitments and
any Letter of Credit (excluding any Cash Collateralized Letter of Credit) have
expired or been terminated.  The Administrative Agent shall be under no duty to
exercise or withhold the exercise of any of the rights, powers, privileges and
options expressly or implicitly granted to the Administrative Agent in this
Agreement, and
 
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shall not be liable for any failure to do so or any delay in doing so.  The
Administrative Agent shall not be liable for any act or omission or for any
error of judgment or any mistake of fact or law in its individual capacity or
its capacity as attorney-in-fact except acts or omissions resulting from its
gross negligence or willful misconduct.  This power of attorney is conferred on
the Administrative Agent solely to protect, preserve and realize upon its
security interest in the Collateral.
 
(b)           Assignment by the Administrative Agent. The Administrative Agent
may from time to time assign the Secured Obligations to a successor
Administrative Agent appointed in accordance with the Credit Agreement, and such
successor shall be entitled to all of the rights and remedies of the
Administrative Agent under this Agreement in relation thereto.

(c)           The Administrative Agent’s Duty of Care.  Other than the exercise
of reasonable care to assure the safe custody of the Collateral while being held
by the Administrative Agent hereunder, the Administrative Agent shall have no
duty or liability to preserve rights pertaining thereto, it being understood and
agreed that the Obligors shall be responsible for preservation of all rights in
the Collateral, and the Administrative Agent shall be relieved of all
responsibility for the Collateral upon surrendering it or tendering the
surrender of it to the Obligors.  The Administrative Agent shall be deemed to
have exercised reasonable care in the custody and preservation of the Collateral
in its possession if the Collateral is accorded treatment substantially equal to
that which the Administrative Agent accords its own property, which shall be no
less than the treatment employed by a reasonable and prudent agent in the
industry, it being understood that the Administrative Agent shall not have
responsibility for taking any necessary steps to preserve rights against any
parties with respect to any of the Collateral.  In the event of a public or
private sale of Collateral pursuant to Section 7 hereof, the Administrative
Agent shall have no responsibility for (i) ascertaining or taking action with
respect to calls, conversions, exchanges, maturities, tenders or other matters
relating to any Collateral, whether or not the Administrative Agent has or is
deemed to have knowledge of such matters, or (ii) taking any steps to clean,
repair or otherwise prepare the Collateral for sale.

(d)           Releases of Collateral.  If any Collateral shall be sold,
transferred or otherwise disposed of by any Obligor, or if any Obligor shall
secure any Debt Issuance with any Collateral, in each case, in a transaction
permitted by the Credit Agreement, then the Administrative Agent, at the request
and sole expense of such Obligor, shall promptly execute and deliver to such
Obligor all releases and other documents, and take such other action, reasonably
necessary for the release of the Liens created hereby or by any other Collateral
Document on such Collateral.

9.           Application of Proceeds.  Upon the acceleration of the Obligations
under the terms of the Credit Agreement, any payments in respect of the Secured
Obligations and any proceeds of the Collateral, when received by the
Administrative Agent or any holder of the Secured Obligations in Money, will be
applied in reduction of the Secured Obligations in the order set forth in the
Credit Agreement.
 
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10.           Continuing Agreement.

(a)           This Agreement shall remain in full force and effect until such
time as the Secured Obligations (excluding Secured Obligations solely with
respect to Cash Collateralized Letters of Credit) arising under the Loan
Documents have been paid in full and the Commitments and any Letter of Credit
(excluding any Cash Collateralized Letter of Credit) have expired or been
terminated, at which time this Agreement shall be automatically terminated and
the Administrative Agent shall, upon the request and at the expense of the
Obligors, forthwith release all of its liens and security interests hereunder
and shall execute and deliver all UCC termination statements and/or other
documents reasonably requested by the Obligors evidencing such termination.

(b)           This Agreement shall continue to be effective or be automatically
reinstated, as the case may be, if at any time payment, in whole or in part, of
any of the Secured Obligations is rescinded or must otherwise be restored or
returned by the Administrative Agent or any holder of the Secured Obligations as
a preference, fraudulent conveyance or otherwise under any Debtor Relief Law,
all as though such payment had not been made; provided that in the event payment
of all or any part of the Secured Obligations is rescinded or must be restored
or returned, all reasonable costs and expenses (including without limitation any
reasonable legal fees and disbursements) incurred by the Administrative Agent or
any holder of the Secured Obligations in defending and enforcing such
reinstatement shall be deemed to be included as a part of the Secured
Obligations.

11.           Amendments; Waivers; Modifications, etc.  This Agreement and the
provisions hereof may not be amended, waived, modified, changed, discharged or
terminated except as set forth in the Credit Agreement.

12.           Successors in Interest.  This Agreement shall be binding upon each
Obligor, its successors and assigns and shall inure, together with the rights
and remedies of the Administrative Agent and the holders of the Secured
Obligations hereunder, to the benefit of the Administrative Agent and the
holders of the Secured Obligations and their successors and permitted assigns.

13.           Notices.  All notices required or permitted to be given under this
Agreement shall be in conformance with the terms of the Credit Agreement.

14.           Counterparts; Signatures.  This Agreement may be executed in any
number of counterparts, each of which where so executed and delivered shall be
an original, but all of which shall constitute one and the same instrument.  It
shall not be necessary in making proof of this Agreement to produce or account
for more than one such counterpart.  Any signature delivered by facsimile or
electronic mail shall be deemed to be an original signature hereto, provided
that the Obligors shall deliver an original to the Administrative Agent upon the
Administrative Agent’s request.

15.           Headings.  The headings of the sections hereof are provided for
convenience only and shall not in any way affect the meaning or construction of
any provision of this Agreement.
 
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16.           Governing Law; Submission to Jurisdiction; Venue; WAIVER OF JURY
TRIAL.  The terms of Sections 11.14 and 11.15 of the Credit Agreement with
respect to governing law, submission to jurisdiction, venue and waiver of jury
trial are incorporated herein by reference, mutatis mutandis, and the parties
hereto agree to such terms.

17.           Severability.  If any provision of any of the Agreement is
determined to be illegal, invalid or unenforceable, such provision shall be
fully severable and the remaining provisions shall remain in full force and
effect and shall be construed without giving effect to the illegal, invalid or
unenforceable provisions.

18.           Entirety.  This Agreement, the other Loan Documents and the other
documents relating to the Secured Obligations represent the entire agreement of
the parties hereto and thereto, and supersede all prior agreements and
understandings, oral or written, if any, including any commitment letters or
correspondence relating to the Loan Documents, any other documents relating to
the Secured Obligations, or the transactions contemplated herein and therein.

19.           Other Security.  To the extent that any of the Secured Obligations
are now or hereafter secured by property other than the Collateral (including,
without limitation, real property and securities owned by an Obligor), or by a
guarantee, endorsement or property of any other Person, then the Administrative
Agent shall have the right to proceed against such other property, guarantee or
endorsement upon the occurrence and during the continuance of any Event of
Default, and the Administrative Agent shall have the right, in its sole
discretion, to determine which rights, security, liens, security interests or
remedies the Administrative Agent shall at any time pursue, relinquish,
subordinate, modify or take with respect thereto, without in any way modifying
or affecting any of them or the Secured Obligations or any of the rights of the
Administrative Agent or the holders of the Secured Obligations under this
Agreement, under any other of the Loan Documents or under any other document
relating to the Secured Obligations.

20.           Joinder.  At any time after the date of this Agreement, one or
more additional Persons may become party hereto by executing and delivering to
the Administrative Agent a Joinder Agreement.  Immediately upon such execution
and delivery of such Joinder Agreement (and without any further action), each
such additional Person will become a party to this Agreement as an “Obligor” and
have all of the rights and obligations of an Obligor hereunder and this
Agreement and the schedules hereto shall be deemed amended by such Joinder
Agreement.

21.           Rights of Required Lenders.  All rights of the Administrative
Agent hereunder, if not exercised by the Administrative Agent, may be exercised
by the Required Lenders.

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Each of the parties hereto has caused a counterpart of this Agreement to be duly
executed and delivered as of the date first above written.
 
OBLIGORS:
 
BROOKDALE SENIOR LIVING INC., a
Delaware corporation
 
 
By:   /s/ T. Andrew Smith                             
Name:  T. Andrew Smith
Title:   Executive Vice President and Secretary
 
 
BROOKDALE SENIOR LIVING
COMMUNITIES, INC., a Delaware
corporation, f/k/a Alterra Healthcare
Corporation, a Delaware corporation
 
 
By:   /s/ T. Andrew Smith                             
Name:  T. Andrew Smith
Title:   Executive Vice President and Secretary
 
 
AHC STERLING HOUSE OF HARBISON,
LLC, a Delaware limited liability company
 
 
By:   /s/ T. Andrew Smith                             
Name: T. Andrew Smith
Title:   Executive Vice President and Secretary
 
 
ALS NORTH AMERICA, INC., a Delaware
corporation
 
 
By:   /s/ T. Andrew Smith                             
Name: T. Andrew Smith
Title:   Executive Vice President and Secretary
 
 
AHC PROPERTIES, INC, a Delaware
corporation
 
 
By:   /s/ T. Andrew Smith                             
Name: T. Andrew Smith
Title:   Executive Vice President and Secretary
 

 
 

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BKD STERLING HOUSE OF LAWTON,
LLC, a Delaware limited liability company
 
 
By:   /s/ T. Andrew Smith                             
Name: T. Andrew Smith
Title:   Executive Vice President and Secretary
 
 
 
AHC RICHLAND HILLS, LLC, a Delaware
limited liability company
 
 
By:   /s/ T. Andrew Smith                             
Name: T. Andrew Smith
Title:   Executive Vice President and Secretary
 
 
 
CAROLINA HOUSE OF BLUFFTON, LLC, a
North Carolina limited liability company
 
 
By:   /s/ T. Andrew Smith                             
Name: T. Andrew Smith
Title:   Executive Vice President and Secretary
 
 
 
CAROLINA HOUSE OF HILTON HEAD,
LLC, a North Carolina limited liability company
 
 
By:   /s/ T. Andrew Smith                             
Name: T. Andrew Smith
Title:   Executive Vice President and Secretary
 
 
FIT RAMSEY, LLC, a Delaware limited
liability company
 
 
By:   /s/ T. Andrew Smith                             
Name: T. Andrew Smith
Title:   Executive Vice President and Secretary
 
 

 
 

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BLC NOVI-GC, LLC, a Delaware limited
liability company
 
 
By:   /s/ T. Andrew Smith                             
Name: T. Andrew Smith
Title:   Executive Vice President and Secretary
 
 
 
ARC HDV, LLC, a Tennessee limited liability
company
 
 
By:   /s/ T. Andrew Smith                             
Name: T. Andrew Smith
Title:   Executive Vice President and Secretary
 

 
 

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Accepted and agreed to as of the date first above written.

BANK OF AMERICA, N.A., as Administrative Agent

By:
  /s/ Kevin Ahart
   
Name:
     Kevin Ahart
   
Title:
   Vice President