Exhibit 10.3

MASTER CREDIT FACILITY AGREEMENT
(SENIORS HOUSING)

BY AND BETWEEN

THE BORROWERS LISTED ON SCHEDULE 2

AND

JONES LANG LASALLE MULTIFAMILY, LLC

DATED AS OF

AUGUST 31, 2017

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TABLE OF CONTENTS
 
 
Page
 
 
 
ARTICLE 1
DEFINITIONS; SUMMARY OF TERMS
2
Section 1.01
Defined Terms
2
Section 1.02
Schedules, Exhibits, and Attachments Incorporated
2
ARTICLE 2
THE COMMITMENT; ADVANCES; COLLATERAL EVENTS
2
Section 2.01
Variable Advance and Fixed Advance
2
(a)
Variable Advance
2
(b)
Fixed Advance
2
Section 2.02
Advances
2
(a)
Request
2
(b)
Limitations on Executions
2
(c)
Making Advances
2
Section 2.03
Advance Terms and Payments on Advances
4
(a)
Debt Service Payments
4
(b)
Capitalization of Accrued but Unpaid Interest
7
(c)
Late Charges
7
(d)
Default Rate
8
(e)
Address for Payments
9
(f)
Application of Payments
9
Section 2.04
Prepayment; Prepayment Lockout; Prepayment Premium
9
Section 2.05
Acceleration of Advances
10
Section 2.06
Application of Collateral
11
Section 2.07
Casualty and Condemnation
11
Section 2.08
No Effect on Payment Obligations
11
Section 2.09
Loss Resulting from Prepayment
11
Section 2.10
Collateral Events
12
(a)
Conversion from Variable Note to Fixed Note
12
(b)
Right to Obtain Releases of Mortgaged Property
12
(c)
Right to Add Additional Mortgaged Properties as Collateral
12
(d)
Right to Substitutions
12
(e)
Limitation on Collateral Events
12
(f)
Intentionally Omitted
12
Section 2.11
Termination of Master Agreement
12
(a)
Request
13
(b)
Conditions Precedent
13
(c)
Closing
13
ARTICLE 3
PERSONAL LIABILITY
13
Section 3.01
Non-Recourse Liability; Exceptions
13
Section 3.02
Personal Liability of Borrower
14

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Page
(a)
Personal Liability Based on Lender’s Loss (Partial Recourse)
14
(b)
Full Personal Liability (Full Recourse)
16
Section 3.03
Personal Liability for Indemnity Obligations
16
Section 3.04
Lender’s Right to Forego Rights Against Mortgaged Property
17
Section 3.05
Borrower Agency Provisions
17
Section 3.06
Joint and Several Obligation; Cross-Guaranty
18
Section 3.07
Waivers With Respect to Other Borrower Secured Obligation
18
Section 3.08
No Impairment
22
Section 3.09
Election of Remedies
23
Section 3.10
Subordination of Other Obligations
23
Section 3.11
Insolvency and Liability of Other Borrower
24
Section 3.12
Preferences, Fraudulent Conveyances, Etc
25
Section 3.13
Maximum Liability of Each Borrower
25
Section 3.14
Liability Cumulative
26
ARTICLE 4
BORROWER AND PROPERTY OPERATOR STATUS
26
Section 4.01
Representations and Warranties
26
(a)
Due Organization and Qualification; Organizational Agreements
26
(b)
Location
27
(c)
Power and Authority
27
(d)
Due Authorization
27
(e)
Valid and Binding Obligations
28
(f)
Effect of Master Agreement on Financial Condition
28
(g)
Economic Sanctions, Anti-Money Laundering, and Anti-Corruption
29
(h)
Single Purpose Status
29
(i)
No Bankruptcies or Judgments
32
(j)
No Actions or Litigation
32
(k)
Payment of Taxes, Assessments, and Other Charges
33
(l)
Not a Foreign Person
33
(m)
ERISA
33
(n)
Default Under Other Obligations
34
(o)
Prohibited Person
34
(p)
No Contravention; No Liens
34
(q)
Lockbox Arrangement
35
(r)
No Reliance
35
(s)
Investment Company Act
35
(t)
Licensing; Borrower/Property Operator Compliance with Laws
36
Section 4.02
Covenants
37
(a)
Maintenance of Existence; Organizational Documents
37
(b)
Economic Sanctions, Anti-Money Laundering, and Anti-Corruption
38
(c)
Payment of Taxes, Assessments, and Other Charges
39
(d)
Single Purpose Status
39

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Page
(e)
ERISA
41
(f)
Notice of Litigation or Insolvency
41
(g)
Payment of Costs, Fees, and Expenses
42
(h)
Restrictions on Distributions
43
(i)
Lockbox Arrangement
43
(j)
Confidentiality of Certain Information
43
(k)
Intentionally Omitted
43
(l)
Borrower/Property Operator Compliance with Laws
43
ARTICLE 5
THE ADVANCES
44
Section 5.01
Representations and Warranties
44
(a)
Receipt and Review of Loan Documents
45
(b)
No Default
45
(c)
No Defenses
45
(d)
Loan Document Taxes
45
Section 5.02
Covenants
45
(a)
Ratification of Covenants; Estoppels; Certifications
45
(b)
Further Assurances
46
(c)
Sale of Advances
47
(d)
Limitations on Further Acts of Borrower
48
(e)
Financing Statements; Record Searches
48
(f)
Loan Document Taxes
48
(g)
Date-Down Endorsements
48
Section 5.03
Administrative Matters Regarding Advances
49
(a)
Determination of Allocable Facility Amount and Valuations
49
ARTICLE 6
PROPERTY USE, PRESERVATION, AND MAINTENANCE
50
Section 6.01
Representations and Warranties
50
(a)
Mortgaged Property Compliance with Laws; Permits and Licenses
50
(b)
Operating Documents; Contracts; Resident Records
51
(c)
Property Characteristics
51
(d)
Property Ownership
51
(e)
Condition of the Mortgaged Property
52
(f)
Personal Property
52
(g)
Medicaid Provider Agreement Representations
52
Section 6.02
Covenants
53
(a)
Use of Property
53
(b)
Property Maintenance
54
(c)
Property Preservation
56
(d)
Property Inspections
57
(e)
Mortgaged Property Compliance with Laws
57

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Page
(f)
Alterations to any Mortgaged Property
58
(g)
Licensing
59
(h)
Medicaid Provider Agreement
60
(i)
Facility Operating Agreement
62
(j)
Change in Property Operator
63
(k)
Contracts
64
(l)
All Representations and Covenants Deemed Borrower Responsibility
65
Section 6.03
Administration Matters Regarding the Property
67
(a)
Property Management
67
(b)
Subordination of Fees by Property Operator
67
(c)
Property Condition Assessment
68
ARTICLE 7
LEASES AND RENTS
68
Section 7.01
Representations and Warranties
68
(a)
Prior Assignment of Rents
68
(b)
Prepaid Rents
68
(c)
Seniors Housing Facility Lease
69
Section 7.02
Covenants
70
(a)
Leases
70
(b)
Commercial Leases
70
(c)
Payment of Rents
71
(d)
Assignment of Rents
72
(e)
Further Assignments of Leases and Rents
72
(f)
Options to Purchase by Tenants
72
(g)
Special Covenants Regarding Seniors Housing Facility Lease
72
Section 7.03
Administration Regarding Leases and Rents
75
(a)
Material Commercial Lease Requirements
75
(b)
Residential Lease Form
75
(c)
Seniors Housing Facility Lease Structure Consideration
76
ARTICLE 8
BOOKS AND RECORDS; FINANCIAL REPORTING
76
Section 8.01
Representations and Warranties
76
(a)
Financial Information
76
(b)
No Change in Facts or Circumstances
76
Section 8.02
Covenants
77
(a)
Obligation to Maintain Accurate Books and Records; Access; Discussions with
Officers and Accountants
77
(b)
Items to Furnish to Lender
78
(c)
Audited Financials
83
(d)
Delivery of Books and Records
83

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Page
Section 8.03
Administration Matters Regarding Books and Records and Financial Reporting
83
(a)
Lender’s Right to Obtain Audited Books and Records
83
(b)
Credit Reports; Credit Score
84
ARTICLE 9
INSURANCE
84
Section 9.01
Representations and Warranties
84
(a)
Compliance with Insurance Requirements
84
(b)
Property Condition
84
Section 9.02
Covenants
84
(a)
Insurance Requirements
84
(b)
Delivery of Policies, Renewals, Notices, and Proceeds
85
Section 9.03
Administration Matters Regarding Insurance
86
(a)
Lender’s Ongoing Insurance Requirements
86
(b)
Application of Proceeds on Event of Loss
86
(c)
Payment Obligations Unaffected
89
(d)
Foreclosure Sale
89
(e)
Appointment of Lender as Attorney-In-Fact
89
ARTICLE 10
CONDEMNATION
89
Section 10.01
Representations and Warranties
89
(a)
Prior Condemnation Action
89
(b)
Pending Condemnation Actions
89
Section 10.02
Covenants
90
(a)
Notice of Condemnation
90
(b)
Condemnation Proceeds
90
Section 10.03
Administration Matters Regarding Condemnation
90
(a)
Application of Condemnation Awards
90
(b)
Payment Obligations Unaffected
90
(c)
Appointment of Lender as Attorney-In-Fact
91
(d)
Preservation of Mortgaged Property
91
ARTICLE 11
LIENS, TRANSFERS, AND ASSUMPTIONS
91
Section 11.01
Representations and Warranties
91
(a)
No Labor or Materialmen’s Claims
91
(b)
No Other Interests
92
Section 11.02
Covenants
92
(a)
Liens; Encumbrances
92

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Page
(b)
Transfers
93
(c)
Facility Operating Agreement
96
(d)
No Other Indebtedness
96
(e)
No Mezzanine Financing or Preferred Equity
97
Section 11.03
Administration Matters Regarding Liens, Transfers, and Assumptions
97
(a)
Transfer of Collateral Pool
97
(b)
Permitted Transfers of Ownership Interests
99
(c)
Estate Planning
101
(d)
Termination or Revocation of Trust
101
(e)
Death of Key Principal or Guarantor; Restricted Ownership Interest/Controlling
Interest Transfer Due to Death
102
(f)
Intentionally Deleted
103
(g)
Further Conditions on Transfers Requiring Lender’s Consent
103
ARTICLE 12
IMPOSITIONS
105
Section 12.01
Representations and Warranties
105
(a)
Payment of Taxes, Assessments, and Other Charges
105
Section 12.02
Covenants
105
(a)
Imposition Deposits, Taxes, and Other Charges
105
(b)
Conditional Waiver
106
Section 12.03
Administration Matters Regarding Impositions
106
(a)
Maintenance of Records by Lender
106
(b)
Imposition Accounts
106
(c)
Payment of Impositions; Sufficiency of Imposition Deposits
107
(d)
Imposition Deposits Upon Event of Default
107
(e)
Contesting Impositions
107
(f)
Release to Borrower
108
ARTICLE 13
REPLACEMENT RESERVE AND REPAIRS
108
Section 13.01
Covenants
108
(a)
Initial Deposits to Replacement Reserve Account and Repairs Escrow Account
108
(b)
Monthly Replacement Reserve Deposits
108
(c)
Payment for Replacements and Repairs
108
(d)
Assignment of Contracts for Replacements and Repairs
109
(e)
Indemnification
109
(f)
Amendments to Loan Documents
109
(g)
Administrative Fees and Expenses
109
Section 13.02
Administration Matters Regarding Reserves
110
(a)
Accounts, Deposits, and Disbursements
110

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Page
(b)
Approvals of Contracts; Assignment of Claims
117
(c)
Delays and Workmanship
117
(d)
Appointment of Lender as Attorney-In-Fact
118
(e)
No Lender Obligation
118
(f)
No Lender Warranty
118
ARTICLE 14
DEFAULTS/REMEDIES
118
Section 14.01
Events of Default
118
(a)
Automatic Events of Default
118
(b)
Events of Default Subject to a Specified Cure Period
121
(c)
Events of Default Subject to Extended Cure Period or Release
122
Section 14.02
Remedies
123
(a)
Acceleration; Foreclosure
123
(b)
Loss of Right to Disbursements from Collateral Accounts
123
(c)
Remedies Cumulative
124
(d)
Operations upon Event of Default; Lockbox Account
124
Section 14.03
Additional Lender Rights; Forbearance
125
(a)
No Effect Upon Obligations
125
(b)
No Waiver of Rights or Remedies
126
(c)
Appointment of Lender as Attorney-In-Fact
126
(d)
Borrower Waivers
128
Section 14.04
Waiver of Marshaling
128
Section 14.05
Severed Loan Documents
129
ARTICLE 15
MISCELLANEOUS
130
Section 15.01
Choice of Law; Consent to Jurisdiction
130
Section 15.02
Waiver of Jury Trial
130
Section 15.03
Notice
131
(a)
Process of Serving Notice
131
(b)
Change of Address
131
(c)
Default Method of Notice
131
(d)
Receipt of Notices
132
(e)
Property Operator Notices
132
Section 15.04
Successors and Assigns Bound; Sale of Advances
132
(a)
Binding Agreement
132
(b)
Sale of Advances; Change of Servicer
132
Section 15.05
Counterparts
132
Section 15.06
Intentionally Deleted
133
Section 15.07
Relationship of Parties; No Third Party Beneficiary
133
(a)
Solely Creditor and Debtor
133
(b)
No Third Party Beneficiaries
133
Section 15.08
Severability; Entire Agreement; Amendments
133
Section 15.09
Construction
134
Section 15.10
Loan Servicing
135
Section 15.11
Disclosure of Information
135
Section 15.12
Waiver; Conflict
135
Section 15.13
Intentionally Deleted
135

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Page
Section 15.14
No Reliance
135
Section 15.15
Subrogation
136
Section 15.16
Counting of Days
136
Section 15.17
Revival and Reinstatement of Indebtedness
136
Section 15.18
Time is of the Essence
136
Section 15.19
Final Agreement
136
Section 15.20
Survival
137
Section 15.21
Assignments; Third Party Rights
137
Section 15.22
Interpretation
137

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SCHEDULES & EXHIBITS

Schedules
 
 
 
 
 
Schedule 1
Definitions Schedule – General
 
Schedule 2
Summary of Master Terms
 
Schedule 2A
New York Gap Note Modifications
Form 6234
Schedule 3.1
Schedule of Advance Terms (Gap Note)
 
Schedule 3.2
Schedule of Advance Terms (Fixed – 7 Years)
 
Schedule 3.3
Schedule of Advance Terms (Fixed – 10 Years)
 
Schedule 3.4
Schedule of Advance Terms (Variable)
 
Schedule 4.1
Prepayment Premium Schedule (Gap Note)
 
Schedule 4.2
Prepayment Premium Schedule (Fixed – 7 Years)
Form 6104.01 [08 -13]
Schedule 4.3
Prepayment Premium Schedule (Fixed – 10 Years)
Form 6104.01 [08 -13]
Schedule 4.4
Prepayment Premium Schedule (Variable)
Form 6104.11[01-11]
Schedule 5
Required Replacement Schedule
 
Schedule 6
Required Repair Schedule
 
Schedule 7
General Conditions Schedule
 
Schedule 8
Property-Related Documents Schedule
 
Schedule 9
Conversion Schedule
 
Schedule 10
Mortgaged Property Release Schedule
 
Schedule 11
Mortgaged Property Addition Schedule
 
Schedule 12
Reserved
 
Schedule 13
Ownership Interests Schedule
 
Schedule 14
Future Advance Schedule
 
Schedule 15
Letter of Credit Schedule
 
Schedule 16
Exceptions to Representations and Warranties Schedule
 
Schedule 17
Waiver of Imposition Deposits
Form 6228 [modified] [04-12]
Schedule 18
Reserved
 
Schedule 19
Skilled Nursing
Form 6001 [01-16]
Schedule 19-A
Addenda to Schedule 2
Form 6001.NR.SRS [01-16]
Schedule 20
Expansion Structure General Terms
 
Schedule 21
Schedule 22
Mineral Rights Conveyances
Licenses, Permits and other Property Related Documents to be Delivered post
closing
 
Schedule 23
Surveys
 
Schedule 24
Licenses
 

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Schedule 25
Ground Lease Defaults
Form 6206 [07-11]
Schedule 26
Kansas – No Oral Agreements
 

Exhibits
 
 
 
 
 
Exhibit A
Mortgaged Properties
 
Exhibit B
Conversion Request
 
Exhibit C
Release Request
 
Exhibit D
Addition Request
 
Exhibit E
Future Advance Request
 
Exhibit F
Termination Request
 
Exhibit G
Annual Certification (Borrower)
 
Exhibit H
Annual Certification (Guarantor)
 
Exhibit I
Confirmation of Guaranty
 
Exhibit J
Confirmation of Environmental Indemnity Agreement
 
Exhibit K
Compliance Certificate
 
Exhibit L-1
Organizational Certificate (Borrower)
 
Exhibit L-2
Organizational Certificate (Guarantor)
 
Exhibit M
Confirmation of Obligations
 

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MASTER CREDIT FACILITY AGREEMENT
(SENIORS HOUSING)

This MASTER CREDIT FACILITY AGREEMENT (as amended, restated, replaced,
supplemented, or otherwise modified from time to time, and further defined in
the Definitions Schedule, the “Master Agreement”) is made as of August 31, 2017
by and among (i) the parties listed on EXHIBIT A attached hereto (collectively,
“Borrower”), as Borrower and (ii) JONES LANG LASALLE MULTIFAMILY, LLC, a
Delaware limited liability company (“Lender”), as Lender.
RECITALS:

A.    Borrower owns one (1) or more Multifamily Residential Properties as more
particularly described in Exhibit A to this Master Agreement.
B.    Borrower has requested that Lender make a loan in favor of Borrower,
comprised of a $390,000,000 Variable Advance, a $292,500,000 Fixed Advance, and
a $292,500,000 Fixed Advance. Future Advances may be made by Lender to Borrower
in accordance with the terms of this Master Agreement.
C.    To secure the obligations of Borrower under this Master Agreement and the
other Loan Documents, Borrower shall create a Collateral Pool in favor of
Lender. The Collateral Pool shall be comprised of (i) the Multifamily
Residential Properties listed on Exhibit A and (ii) any other collateral pledged
to Lender from time to time by Borrower pursuant to this Master Agreement or any
other Loan Documents.
D.    Each Note and Security Document shall be cross-defaulted (i.e., a default
under any Note, Security Document or this Master Agreement shall constitute a
default under each other Note and Security Document and under this Master
Agreement) and cross-collateralized (i.e., each Security Instrument shall secure
all of Borrower’s obligations under each Note, this Master Agreement, and the
other Loan Documents). It is the intent of the parties to this Master Agreement
that, after an Event of Default, Lender may accelerate any Note without the
obligation but with the right to accelerate any other Note and that in the
exercise of its rights and remedies under the Loan Documents, Lender may
exercise and perfect any and all of its rights and remedies in and under the
Loan Documents with regard to any Mortgaged Property without the obligation but
with the right to exercise and perfect its rights and remedies with respect to
any other Mortgaged Property. Any such exercise shall be without regard to the
Allocable Facility Amount assigned to such Mortgaged Property. Lender may
recover an amount equal to the full amount Outstanding in respect of any of the
Notes in connection with such exercise and any such amount shall be applied to
the Indebtedness as determined by Lender pursuant to the terms of this Master
Agreement, the Notes, and the other Loan Documents.
E.    It is the intent of the parties that, notwithstanding anything to the
contrary herein or the existence of any cash management system maintained by
Borrower, and/or Guarantor or Borrower Affiliates or the provision by Guarantor
of the Guaranty, Lender is making Advances to Borrower (not to Guarantor or
Borrower Affiliates). Lender has underwritten the making of the

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Advances based on its analysis of the value of the Collateral. In making the
Advances, Lender is relying on each Borrower being and maintaining itself as a
Single Purpose entity whose sole asset is one or more Mortgaged Properties and
ancillary property related thereto. Lender acknowledges that it views its credit
risk as the performance and value of the Mortgaged Properties and it views the
Guaranty as independent supplemental support in the event that one of the
exceptions to the non-recourse events occurs.
F.    Subject to the terms, conditions, and limitations of this Master
Agreement, Lender has agreed to make the Advances.
G.    It is anticipated that Lender shall assign each Advance made hereunder to
Fannie Mae; however Fannie Mae shall not assume (i) any of the obligations of
Lender, if any, under this Master Agreement to make Future Advances, or (ii) any
of the obligations of Lender which are servicing obligations delegated to Lender
as servicer of the Advances.
NOW, THEREFORE, in consideration of Borrower and Lender entering into this
Master Agreement and other good and valuable consideration, the receipt and
adequacy of which are hereby conclusively acknowledged, the parties hereby
covenant, agree, represent, and warrant as follows:
AGREEMENTS:

ARTICLE 1
DEFINITIONS; SUMMARY OF TERMS
Section 1.01    Defined Terms.
Capitalized terms not otherwise defined in the body of this Master Agreement
shall have the meanings set forth in the Definitions Schedule attached to this
Master Agreement.
Section 1.02    Schedules, Exhibits, and Attachments Incorporated.
The schedules, exhibits, and any other addenda or attachments are incorporated
fully into this Master Agreement by this reference and each constitutes a
substantive part of this Master Agreement.
ARTICLE 2    
THE COMMITMENT; ADVANCES; COLLATERAL EVENTS
Section 2.01    Variable Advance and Fixed Advance.
Subject to the terms, conditions, and limitations of this Master Agreement:
(a)    Variable Advance.
Lender agrees to make Variable Advances to Borrower in accordance with the terms
and

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provisions of this Master Agreement. Future Advances may be made pursuant to
Section 2.02(c)(2) (Future Advances). Pursuant to the terms of Section 2.10(a)
(Conversion from Variable Note to Fixed Note), Borrower may convert a Variable
Note to a Fixed Note.
(b)    Fixed Advance.
Lender agrees to make Fixed Advances to Borrower in accordance with the terms
and provisions of this Master Agreement. Future Advances may be made pursuant to
Section 2.02(c)(2) (Future Advances).
Section 2.02    Advances.
(a)    Request.
Assuming Advances are available to Borrower under this Master Agreement and this
Section 2.02 (Advances), Borrower shall request a Future Advance by giving
Lender a Future Advance Request. The Future Advance Request shall indicate
whether the Request is for a Fixed Advance or Variable Advance or more than one
type of Advance.
(b)    Limitations on Executions.
Notwithstanding anything in this Master Agreement or any other Loan Document to
the contrary, any Future Advance (whether a Variable Advance or a Fixed Advance)
and any Conversion of an Advance shall be subject to the precondition that
Lender must confirm with Fannie Mae that Fannie Mae is generally offering to
purchase in the marketplace advances of the execution type requested by Borrower
at the time of the Request and at the time the rate for such Advance is locked.
In the event Fannie Mae is not purchasing advances of the type requested by
Borrower, Lender agrees to offer, to the extent available from Fannie Mae,
alternative advance executions based on the types of executions Fannie Mae is
generally offering to purchase in the marketplace at that time. Any alternative
execution offered would be subject to mutually agreeable documentation necessary
to implement the terms and conditions of such alternative execution.
(c)    Making Advances.
(1)    Initial Advances.
Assuming conditions of Lender have been met prior to or as of the date of this
Master Agreement, Lender shall make the Initial Advance(s) to Borrower.
(2)    Future Advances.
(A)    Subject to Section 2.02(b) (Limitations on Executions) and satisfaction
of the terms in the Future Advance Schedule, Borrower may request a Future
Advance. Lender is not committing in this Master Agreement to make a Future
Advance and any Future Advance will be at the option of Lender except for an
Advance provided in the proviso of Section 2.02(c)(2)(B) (Future Advances)

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below, subject to the requirements of such proviso and this Master Agreement.
Once made, any Future Advance shall be subject to this Master Agreement in all
respects and shall be secured by the Security Instruments encumbering the
Mortgaged Properties.
(B)    Any Future Advance shall be made in connection with the Addition of
Additional Mortgaged Properties; provided, however, Borrower may request that a
Future Advance made pursuant to Section 2.02(c)(2)(A) (Future Advances) above be
made without the Addition of Additional Mortgaged Property based on compliance
with the terms of the Future Advance Schedule and the Underwriting and Servicing
Requirements subject to the terms of this Section 2.02(c)(2) (Future Advances)
and Section 2.02(b) (Limitations on Executions). Such Future Advance shall be
made during the period beginning on the First Anniversary and ending on the day
immediately prior to the fifth anniversary of the Initial Effective Date, but
not more than once per year.
(C)    All Future Advances must satisfy the terms of the Future Advance Schedule
and any addition of Additional Mortgaged Property shall satisfy the terms of the
Mortgaged Property Addition Schedule.
(D)    Intentionally Deleted.
(E)    Intentionally Deleted.
(F)    Notwithstanding anything to the contrary in this Master Agreement, no
Future Advance or Conversion shall be permitted unless immediately after such
Future Advance or Conversion the Advances then Outstanding will not exceed one
hundred percent (100%) of the aggregate fair market value of all real property
securing such Advances (where fair market value is determined for these purposes
based upon a current Appraisal or some other commercially reasonable valuation
method).
(G)    Through the third (3rd) anniversary of the Initial Effective Date,
Valuation of the Mortgaged Properties in connection with Collateral Events and
Future Advances will be calculated based upon Lender’s cap rate analysis or
other commercially reasonable Valuation method pursuant to the Underwriting and
Servicing Requirements and new Appraisals will not be required, however, new
Appraisals will be required for any Additional Mortgaged Property added to the
Collateral Pool.
(3)    Closing of Future Advance.
If the conditions set forth in this Section 2.02 (Advances) and the Future
Advance Schedule are satisfied (and, if applicable, all conditions set forth on
the Mortgaged Property Addition Schedule are satisfied), Lender shall make the
requested Future Advance on an Effective Date

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selected by Lender (or on such other date as Borrower and Lender may agree).
Section 2.03    Advance Terms and Payments on Advances.
(a)    Debt Service Payments.
(1)    Short Month Interest.
If the date the proceeds of an Advance are disbursed is any day other than the
first day of the month, interest for the period beginning on the disbursement
date and ending on and including the last day of the month in which the
disbursement occurs shall be payable by Borrower on the date the Advance
proceeds are disbursed. In the event that the disbursement date is not the same
as the Effective Date, then:
(A)    the disbursement date and the Effective Date must be in the same month,
and
(B)    the Effective Date shall not be the first day of the month.
(2)    Interest Accrual and Computation; Amortization; Interest Rate Cap.
(A)    Except as provided in Section 2.03(a)(1) (Short Month Interest), interest
shall be paid in arrears. Except as otherwise provided in this Master Agreement,
for Fixed Advances, interest shall accrue at the Interest Rate until fully paid;
and for Variable Structured ARM Advances, interest shall accrue at the
Adjustable Rate until fully paid. If the Interest Accrual Method is
“Actual/360,” Borrower acknowledges and agrees that the amount allocated to
interest for each month will vary depending on the actual number of calendar
days during such month.
(B)    With respect to any Variable Structured ARM Advances, the following
provisions shall apply:
(i)    The Initial Adjustable Rate shall be effective until the first Rate
Change Date. Thereafter, the Adjustable Rate shall change on each Rate Change
Date based on fluctuations in the Current Index.
(ii)    Each amortizing Monthly Debt Service Payment shall include a principal
payment equal to the Fixed Monthly Principal Component.
(iii)    Before each Payment Change Date, Lender shall notify Borrower of any
change in the Adjustable Rate and the amount of the next Monthly Debt Service
Payment.

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(iv)    If Lender determines at any time that it has miscalculated the amount of
a Monthly Debt Service Payment (whether because of a miscalculation of the
Adjustable Rate or otherwise), then Lender shall give notice to Borrower of the
corrected amount of the Monthly Debt Service Payment (and the corrected
Adjustable Rate, if applicable) and (1) if the corrected amount of the Monthly
Debt Service Payment represents an increase, then Borrower shall, within thirty
(30) calendar days thereafter, pay to Lender any sums that Borrower would have
otherwise been obligated to pay to Lender had the amount of the Monthly Debt
Service Payment not been miscalculated, or (2) if the corrected amount of the
Monthly Debt Service Payment represents a decrease and Borrower is not otherwise
in default under any of the Loan Documents, then Borrower shall thereafter be
paid the sums that Borrower would not have otherwise been obligated to pay to
Lender had the amount of the Monthly Debt Service Payment not been
miscalculated.
(v)    [Intentionally Deleted]
(vi)    If required by Lender, to protect against fluctuations in interest rates
during the Term of this Master Agreement, Borrower shall enter into the Cap
Security Agreement. Pursuant to the terms of the Cap Security Agreement,
Borrower shall make arrangements for a LIBOR-based interest rate cap in form and
substance satisfactory to Lender with a counterparty satisfactory to Lender
(“Interest Rate Cap”) to be in place and maintained at all times with respect to
any Variable Advance which has been funded and remains Outstanding. The seller
of the Interest Rate Cap (seller and its transferees and assigns, the
“Counterparty”) shall be a financial institution meeting the minimum
requirements for hedge counterparties acceptable to Lender. The Interest Rate
Cap shall have a minimum initial term of three (3) years. Borrower shall be
required to make Monthly Deposits (as defined in the Cap Security Agreement) to
be held in an Interest Rate Cap Reserve Escrow Account (as defined in the Cap
Security Agreement). As set forth in the Cap Security Agreement, Borrower agrees
to pledge its right, title, and interest in the Interest Rate Cap to Lender as
additional collateral for the Indebtedness.
Notwithstanding the foregoing, in the event that an Interest Rate Cap is not
required for any Variable Advance, Borrower shall enter into a Springing Cap
Security Agreement with respect to such Advance. For the avoidance of doubt, on
the Initial Effective Date, Lender has waived the requirement that Borrower
purchase an Interest Rate Cap with respect to the Initial Advance.

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(C)    The amortization and payment of interest (and principal, if applicable)
for each Advance shall be determined at the Effective Date of each Advance.
(3)    Monthly Debt Service Payments.
Consecutive monthly debt service installments (comprised of either interest only
or principal and interest, depending on the Amortization Type), each in the
amount of the applicable Monthly Debt Service Payment for an Advance, shall be
due and payable on the First Payment Date, and on each Payment Date thereafter
until the Maturity Date of such Advance, at which time all Indebtedness relating
to such Advance shall be due. Any regularly scheduled Monthly Debt Service
Payment that is received by Lender before the applicable Payment Date shall be
deemed to have been received on such Payment Date solely for the purpose of
calculating interest due. All payments made by Borrower under this Master
Agreement shall be made without set-off, counterclaim, or other defense.
(4)    Payment at Maturity.
(A)    The unpaid principal balance of an Advance, any Accrued Interest thereon,
and all other Indebtedness relating to such Advance shall be due and payable on
the applicable Maturity Date for such Advance.
(B)    Except in connection with a complete repayment of all Advance(s), if
Borrower pays any Advances at maturity of such Advance and requests a Release of
any Mortgaged Property, such Release shall be subject to the Release Price and
release tests in the Mortgaged Property Release Schedule.
(5)    Maturity Dates.
(A)    The Maturity Date of each Variable Advance shall be specified by Borrower
for such Variable Advance, provided that such Maturity Date shall be no earlier
than the date that is the first day of the month following the date five (5)
years after the Effective Date of such Variable Advance and no later than the
date that is the first day of the month following the date ten (10) years after
the Effective Date of such Variable Advance provided no Maturity Date shall
exceed the date that is the first day of the month following the date fifteen
(15) years after the Initial Effective Date.
(B)    The Maturity Date of each Fixed Advance shall be specified by Borrower
for such Fixed Advance, provided that such Maturity Date shall be no earlier
than the date that is the first day of the month following the date five (5)
years after the Effective Date for such Fixed Advance and no later than the date
that is the first day of the month following the date twelve (12) years after
the Effective Date of such Fixed Advance provided no Maturity Date shall exceed
the

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date that is the first day of the month following the date fifteen (15) years
after the Initial Effective Date.
(6)    Interest Rate Type; Notes.
(A)    The obligation of Borrower to repay each Variable Advance shall be
evidenced by one or more separate Variable Notes. Each Variable Note shall be
payable to the order of Lender and shall be made in the original principal
amount of such Variable Advance.
(B)    The obligation of Borrower to repay each Fixed Advance shall be evidenced
by one or more separate Fixed Notes. The Fixed Note shall be payable to the
order of Lender and shall be made in the original principal amount of such Fixed
Advance.
(b)    Capitalization of Accrued but Unpaid Interest.
Any accrued and unpaid interest on an Advance remaining past due for thirty (30)
days or more may, at Lender’s election, be added to and become part of the
unpaid principal balance of such Advance.
(c)    Late Charges.
(1)    If any Monthly Debt Service Payment due hereunder is not received by
Lender within ten (10) days after the applicable Payment Date, or any amount
payable under this Master Agreement (other than the payment due on the
applicable Maturity Date for repayment of an Advance in full) or any other Loan
Document is not received by Lender within ten (10) days after the date such
amount is due, inclusive of the date on which such amount is due, Borrower shall
pay to Lender, immediately without demand by Lender, the Late Charge.
(2)    The Late Charge is payable in addition to, and not in lieu of, any
interest payable at the Default Rate pursuant to Section 2.03(d) (Default Rate).
(3)    Borrower acknowledges and agrees that:
(A)    its failure to make timely payments will cause Lender to incur additional
expenses in servicing and processing the Advances;
(B)    it is extremely difficult and impractical to determine those additional
expenses;
(C)    Lender is entitled to be compensated for such additional expenses; and

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(D)    the Late Charge represents a fair and reasonable estimate, taking into
account all circumstances existing on the date hereof, of the additional
expenses Lender will incur by reason of any such late payment.
(d)    Default Rate.
(1)    Default interest shall be paid as follows:
(A)    If any amount due in respect of an Advance (other than amounts due on the
Maturity Date) remains past due for thirty (30) days or more, interest on such
unpaid amount(s) shall accrue from the date payment is due at the Default Rate
and shall be payable upon demand by Lender.
(B)    If any Indebtedness due is not paid in full on the applicable Maturity
Date, then interest shall accrue at the Default Rate on all such unpaid amounts
from such Maturity Date until fully paid and shall be payable upon demand by
Lender.
Absent a demand by Lender, any such amounts shall be payable by Borrower in the
same manner as provided for the payment of Monthly Debt Service Payments. To the
extent permitted by Applicable Law, interest shall also accrue at the Default
Rate on any judgment obtained by Lender against Borrower in connection with the
Advances. To the extent Borrower or any other Person is vested with a right of
redemption, interest shall continue to accrue at the Default Rate during any
redemption period until such time as the Mortgaged Property has been redeemed.
(2)    Borrower acknowledges and agrees that:
(A)    its failure to make timely payments will cause Lender to incur additional
expenses in servicing and processing the Advances; and
(B)    in connection with any failure to timely pay all amounts due in respect
of an Advance on the applicable Maturity Date, or during the time that any
amount due in respect of an Advance is delinquent for more than thirty (30)
days:
(i)    Lender’s risk of nonpayment of the Advance will be materially increased;
(ii)    Lender’s ability to meet its other obligations and to take advantage of
other investment opportunities will be adversely impacted;
(iii)    Lender will incur additional costs and expenses arising from its loss
of the use of the amounts due;
(iv)    it is extremely difficult and impractical to determine such additional
costs and expenses;

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(v)    Lender is entitled to be compensated for such additional risks, costs,
and expenses; and
(vi)    the increase from the Interest Rate to the Default Rate represents a
fair and reasonable estimate of the additional risks, costs, and expenses Lender
will incur by reason of Borrower’s delinquent payment and the additional
compensation Lender is entitled to receive for the increased risks of nonpayment
associated with a delinquency on the Advance (taking into account all
circumstances existing on the applicable Effective Date).
(e)    Address for Payments.
All payments due pursuant to the Loan Documents shall be payable at Lender’s
Payment Address, or such other place and in such manner as may be designated
from time to time by written notice to Borrower by Lender.
(f)    Application of Payments.
Subject to the terms of Section (d) (Application of Release Price) of the
Mortgaged Property Release Schedule, if at any time Lender receives, from
Borrower or otherwise, any payment in respect of the Indebtedness that is less
than all amounts due and payable at such time, then Lender may apply such
payment to amounts then due and payable in any manner and in any order
determined by Lender or hold in suspense and not apply such amount at Lender’s
election. Neither Lender’s acceptance of a payment that is less than all amounts
then due and payable, nor Lender’s application of, or suspension of the
application of, such payment, shall constitute or be deemed to constitute either
a waiver of the unpaid amounts or an accord and satisfaction. Notwithstanding
the application of any such amount to the Indebtedness, Borrower’s obligations
under this Master Agreement and the other Loan Documents shall remain unchanged.
Section 2.04    Prepayment; Prepayment Lockout; Prepayment Premium.
(a)    Subject to the terms and conditions of the applicable Prepayment Premium
Schedule and the requirements relating to application of the Release Price set
forth in the Mortgaged Property Release Schedule, Notes are prepayable in whole
or in part, provided that Borrower shall not make a voluntary full or partial
prepayment of a Note during any Prepayment Lockout Period, if any. Except as
expressly provided in this Master Agreement (including as provided in the
Prepayment Premium Schedule applicable to such Note), a Prepayment Premium
calculated in accordance with the Prepayment Premium Schedule applicable to such
Note shall be payable in connection with any prepayment of such Note.
(b)    If a Prepayment Lockout Period applies to the applicable Note, and during
such Prepayment Lockout Period Lender accelerates the unpaid principal balance
of the Note or otherwise applies collateral held by Lender to the repayment of
any portion of the unpaid principal balance of the Note for any reason other
than as set forth in Section 2.07, the Prepayment Premium

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shall be due and payable and equal to the amount obtained by multiplying the
percentage indicated (if at all) in the Prepayment Premium Schedule for such
Note by the amount of principal being prepaid at the time of such acceleration
or application.
(c)    In connection with any such voluntary prepayment, Borrower acknowledges
and agrees that interest shall always be calculated and paid through the last
day of the month in which the prepayment occurs (even if the Permitted
Prepayment Date for such month is not the last day of such month, or if Lender
approves prepayment on an Intended Prepayment Date that is not a Permitted
Prepayment Date). Borrower further acknowledges that Lender is not required to
accept a voluntary prepayment of a Note on any day other than a Permitted
Prepayment Date. However, if Lender does approve an Intended Prepayment Date
that is not a Permitted Prepayment Date and accepts a prepayment on such
Intended Prepayment Date, such prepayment shall be deemed to be received on the
immediately following Permitted Prepayment Date. If Borrower fails to prepay the
applicable Note (or such portion of the Note as is intended to be prepaid) on
the Intended Prepayment Date for any reason (including on any Intended
Prepayment Date that is approved by Lender) and such failure either continues
for five (5) Business Days, or into the following month, Lender shall have the
right to recalculate the payoff amount. If Borrower prepays a Note either in the
following month or more than five (5) Business Days after the Intended
Prepayment Date that was approved by Lender, Lender shall also have the right to
recalculate the payoff amount based upon the amount of such payment and the date
such payment was received by Lender. Borrower shall immediately pay to Lender
any additional amounts required by any such recalculation.
(d)    After receipt of a partial prepayment, Lender shall re-calculate the
Monthly Debt Service Payment based upon the remaining unpaid principal balance
of the applicable Note for each subsequent monthly debt service installment due
under such Note. For amortizing Advances, the subsequent Monthly Debt Service
Payments shall be calculated by amortizing the remaining unpaid principal
balance of the applicable Note over the Remaining Amortization Period utilizing
the Fixed Rate and the Interest Accrual Method set forth in the applicable
Schedule of Advance Terms. Lender shall notify Borrower of the new required
Monthly Debt Service Payment following receipt of a partial prepayment and
Borrower shall execute any amendment requested by Lender to evidence such new
required monthly installment(s).
Section 2.05    Acceleration of Advances.
Upon acceleration of any Advance, Borrower shall pay to Lender:
(a)    the entire unpaid principal balance of the Advances;
(b)    all Accrued Interest (calculated through the last day of the month in
which the acceleration occurs);
(c)    the Prepayment Premium; and
(d)    all other Indebtedness.

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Section 2.06    Application of Collateral.
Any application by Lender of any collateral or other security to the repayment
of all or any portion of the unpaid principal balance of the Advances prior to
the Maturity Date in accordance with the Loan Documents shall be deemed to be a
prepayment by Borrower. Except as set forth in Section 2.07, any such prepayment
shall require the payment to Lender by Borrower of the Prepayment Premium
calculated on the amount being prepaid in accordance with this Master Agreement
and applied in accordance with Section (d) (Application of Release Price) of the
Mortgaged Property Release Schedule.
Section 2.07    Casualty and Condemnation.
Notwithstanding any provision of this Master Agreement to the contrary, no
Prepayment Premium shall be payable with respect to any prepayment occurring as
a result of the application of any insurance proceeds or amounts received in
connection with a casualty or Condemnation Action in accordance with this Master
Agreement.
Section 2.08    No Effect on Payment Obligations.
Unless otherwise expressly provided in this Master Agreement, any prepayment
required by any Loan Document of less than the entire unpaid principal balance
of the Advance(s) shall not extend or postpone the due date of any subsequent
Monthly Debt Service Payments, Monthly Replacement Reserve Deposit, or other
payment.
Section 2.09    Loss Resulting from Prepayment.
In any circumstance in which a Prepayment Premium is due under this Master
Agreement, Borrower acknowledges that:
(a)    any prepayment of the unpaid principal balance of any Advance, whether
voluntary or involuntary, or following the occurrence of an Event of Default by
Borrower, will result in Lender’s incurring loss, including reinvestment loss,
additional risk, expense, and frustration or impairment of Lender’s ability to
meet its commitments to third parties;
(b)    it is extremely difficult and impractical to ascertain the extent of such
losses, risks and damages;
(c)    the formula for calculating the Prepayment Premium represents a
reasonable estimate of the losses, risks, and damages Lender will incur as a
result of a prepayment; and
(d)    the provisions regarding the Prepayment Premium contained in this Master
Agreement are a material part of the consideration for this Master Agreement,
and that the terms of this Master Agreement are in other respects more favorable
to Borrower as a result of Borrower’s voluntary agreement to such prepayment
provisions.

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Section 2.10    Collateral Events
(a)    Conversion from Variable Note to Fixed Note.
Subject to and in accordance with the terms and conditions of the Conversion
Schedule, Borrower shall have the right, from time to time during the Conversion
Availability Period, to convert all or any portion of a Variable Note to a Fixed
Note.
(b)    Right to Obtain Releases of Mortgaged Property.
Subject to and in accordance with the terms and conditions of the Mortgaged
Property Release Schedule, Borrower shall have the right from time to time to
obtain a release of one or more Mortgaged Properties (a “Release”) from the
Collateral Pool.
(c)    Right to Add Additional Mortgaged Properties as Collateral.
Subject to and in accordance with the terms and conditions of the Mortgaged
Property Addition Schedule, Borrower shall have the right, from time to time to
add one or more Additional Mortgaged Properties (an “Addition”) to the
Collateral Pool.
(d)    Right to Substitutions.
Subject to and in accordance with the terms and conditions of the Mortgaged
Property Release Schedule and the Mortgaged Property Addition Schedule, Borrower
shall have the right to obtain the release of one or more Mortgaged Properties
by replacing such Mortgaged Property with one (1) or more Additional Mortgaged
Properties that meet the requirements of this Master Agreement thereby effecting
a “Substitution” of Collateral.
(e)    Limitation on Collateral Events.
Notwithstanding anything to the contrary in this Master Agreement, no Collateral
Event (other than a Conversion) shall be permitted unless immediately after such
Collateral Event the Advances then Outstanding will not exceed one hundred
percent (100%) of the aggregate fair market value of all real property securing
such Advances (where fair market value is determined for these purposes based
upon a current Appraisal or some other commercially reasonable valuation method
as determined by Lender).
(f)    Intentionally Omitted.
Section 2.11    Termination of Master Agreement.
Subject to the terms and conditions set forth below, Borrower shall have the
right to terminate this Master Agreement and receive a Release of all of the
Collateral.

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(a)    Request.
To terminate this Master Agreement, Borrower shall deliver a Termination Request
to Lender.
(b)    Conditions Precedent.
The right of Borrower to terminate this Master Agreement and to receive a
Release of all of the Collateral from the Collateral Pool and Lender’s
obligation to execute and deliver the Termination Documents on the Effective
Date are subject to the following conditions precedent:
(1)    receipt by Lender of the fully executed Termination Request;
(2)    payment by Borrower in full of each Note Outstanding on the Effective
Date, including any associated Prepayment Premiums or other amounts due under
each Note and all of the other amounts owing by Borrower to Lender under this
Master Agreement and the other Loan Documents; and
(3)    payment by Borrower of Lender’s and Fannie Mae’s reasonable third party
out-of-pocket fees and expenses payable in accordance with this Master
Agreement, including Lender’s and Fannie Mae’s legal fees and expenses.
(c)    Closing.
If all conditions precedent contained in this Section 2.11 (Termination of
Master Agreement) are satisfied, this Master Agreement shall terminate, and
Lender shall cause all of the Collateral to be Released on an Effective Date
selected by Lender, within thirty (30) Business Days after all of the conditions
with respect to such Termination Request have been satisfied (or on such other
date as Borrower and Lender may agree), and all applicable parties shall execute
and deliver, all at the sole cost and expense of Borrower, the Termination
Documents.
ARTICLE 3    
PERSONAL LIABILITY
Section 3.01    Non-Recourse Liability; Exceptions.
Except as otherwise provided in this Article 3 (Personal Liability) or in any
other Loan Document, none of Borrower, or any director, officer, manager,
member, partner, shareholder, trustee, trust beneficiary, or employee of
Borrower, shall have personal liability under this Master Agreement or any other
Loan Document for the repayment of the Indebtedness or for the performance of
any other obligations of Borrower under the Loan Documents, and Lender’s only
recourse for the satisfaction of such Indebtedness and the performance of such
obligations shall be Lender’s exercise of its rights and remedies with respect
to the Mortgaged Properties and any other Collateral held by Lender as security
for the Indebtedness. This limitation on Borrower’s liability shall not limit or
impair Lender’s enforcement of its rights against Guarantor under any Loan

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Document.
Section 3.02    Personal Liability of Borrower
(a)    Personal Liability Based on Lender’s Loss (Partial Recourse).
Borrower shall be personally liable to Lender for the repayment of the portion
of the Indebtedness equal to any loss or damage suffered by Lender as a result
of, subject to any notice and cure period, if any, or in any manner relating to:
(1)    failure to pay as directed by Lender upon demand after an Event of
Default (to the extent actually received by Borrower or Affiliated Property
Operator):
(A)    all Rents to which Lender is entitled under the Loan Documents; and
(B)    the amount of all security deposits then held or thereafter collected
from tenants and not properly applied pursuant to the applicable Leases;
(2)    failure to maintain all insurance policies required by the Loan
Documents, except to the extent Lender has the obligation to pay the premiums
pursuant to Section 12.03(c) (Payment of Impositions; Sufficiency of Imposition
Deposits);
(3)    failure to apply all insurance proceeds received by Borrower or
Affiliated Property Operator or any amounts received by Borrower or Affiliated
Property Operator in connection with a Condemnation Action as required by the
Loan Documents;
(4)    failure to comply with any provision of this Master Agreement or any
other Loan Document relating to the delivery of books and records, statements,
schedules, and reports;
(5)    except to the extent directed otherwise by Lender pursuant to Section
3.02(a)(1) (Personal Liability Based on Lender’s Loss (Partial Recourse)),
failure to apply Rents to the ordinary and necessary expenses of owning or
operating, as applicable, the Mortgaged Properties and Debt Service Amounts, as
and when each is due and payable, except that Borrower will not be personally
liable with respect to Rents that are distributed by Borrower in any Calendar
Quarter if Borrower has paid all ordinary and necessary expenses of owning or
operating, as applicable, the Mortgaged Properties and Debt Service Amounts for
such Calendar Quarter. Notwithstanding the foregoing, Borrower shall not have
personal liability under this provision to the extent that Borrower lacks the
legal right to direct the disbursement of the applicable funds due to an
involuntary Bankruptcy Event or Applicable Law with respect to Borrower that
occurs without the consent, encouragement, or active participation of Affiliated
Property Operator or Guarantor.
(6)    waste or abandonment of any Mortgaged Property;

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(7)    grossly negligent or reckless unintentional material written
misrepresentation or omission by Borrower, Guarantor, Key Principal or any
officer, director, partner, manager, member, shareholder (for so long as
ownership of Guarantor, if applicable, or Key Principal includes shares of
publically traded stock, shareholders of such publically traded stock shall be
limited to Major Shareholders) or trustee of Borrower, Guarantor or Key
Principal in connection with any application for or creation of the
Indebtedness, or grossly negligent or reckless unintentional material written
misrepresentation or omission by Borrower, Affiliated Property Operator,
Guarantor, Key Principal, or any officer, director, partner, manager, member,
shareholder (for so long as ownership of Guarantor, if applicable, or Key
Principal includes shares of publically traded stock, shareholders of such
publically traded stock shall be limited to Major Shareholders), or trustee of
Borrower, Affiliated Property Operator, Guarantor, or Key Principal in
connection with on-going financial or other reporting required by the Loan
Documents, or any request for action or consent by Lender;
(8)    failure to cause the renewal, continuation, extension, or maintenance of
all Licenses or, if any Licenses are to be transferred to a transferee approved
by Lender, failure to cause such Licenses to be transferred or reissued within
the period of time required under Applicable Law and to provide to Lender
written notice of such transfer including copies of the newly issued Licenses;
(9)    in the event Borrower or any Property Operator is a Medicaid Participant
with respect to any Mortgaged Property and has executed a depositary agreement
required by Lender, revocation or termination without Lender’s consent of the
standing instructions from Borrower or Property Operator to the depositary bank
pursuant to such Depository Agreement;
(10)    failure of Borrower to purchase an Interest Rate Cap if required in a
Springing Cap Security Agreement;
(11)    a breach of Section 7.02(b)(1) or Section 7.02(b)(2);
(12)    a breach of Section 6.02(k)(3);
(13)    the exercise of any rights by the holder of any Mineral Rights
Conveyance that causes damage to the surface of the applicable Mortgaged
Property or any improvements located upon such Mortgaged Property, provided that
Borrower’s liability under this clause (13) shall be limited to the lesser of
(i) the Release Price for the impacted Mortgaged Property and (ii) ten percent
(10%) of the aggregate Advances Outstanding as of the date that the personal
liability is incurred;
(14)    failure to comply with each of the Single Purpose requirements of
Section 4.02(d)(4) and (7) – (15) (Borrower Status – Covenants – Single Purpose
Status) of this Master Agreement (subject to possible full recourse liability as
set forth in Section 3.02(b)(1) (Full Personal Liability (Full Recourse));
provided, however, no such recourse

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liability shall arise until the expiration of the cure periods set forth in this
Section 3.02(a)(14) (Personal Liability Based on Lender’s Loss (Partial
Recourse)). Borrower must deliver on an annual basis or upon Lender’s written
request, a certification as to compliance with the covenants set forth in
Section 4.02(d) (Borrower Status – Covenants – Single Purpose Status) as set
forth in Borrower’s Annual Certification. If Borrower breaches a covenant set
forth in Section 4.02(d) (Borrower Status – Covenants – Single Purpose Status),
then, if such breach can be cured, Borrower shall have thirty (30) days from the
earlier of (A) the date of delivery of Borrower’s Annual Certification set forth
in Section 8.02(b)(3)(E) (Items to Furnish to Lender) indicating such breach,
(B) the date Lender notifies Borrower of such breach, or (C) the date Borrower
discovers such breach, to cure such breach, provided that if such breach can be
cured but cannot reasonably be cured within such thirty (30) day period and
Borrower shall have commenced to cure such breach within such thirty (30) day
period and thereafter diligently and expeditiously proceeds to cure the same,
such thirty (30) day period shall be extended for so long as it shall require
Borrower in the exercise of due diligence to cure such breach, it being agreed
that no such extension shall be for a period in excess of sixty (60) days for
any individual breach;
(15)    a violation of Section 6.01(h)(3); provided that Borrower’s liability
under this clause (15) shall be limited to the lesser of (i) the Release Price
for the impacted Mortgaged Property if Borrower elects to release such Mortgaged
Property from the Collateral Pool in accordance with the Mortgaged Property
Release Schedule, and (ii) ten percent (10%) of the aggregate Advances
Outstanding as of the date that the personal liability is incurred;
(16)    failure to pay the Release Price as and when required in Schedule 10 in
connection with a Release pursuant to Section 6.02(m)(4); provided that
Borrower’s liability under this clause (16) shall be limited to the lesser of
(i) the Release Price for the impacted Mortgaged Property if Borrower elects to
release such Mortgaged Property from the Collateral Pool in accordance with the
Mortgaged Property Release Schedule, and (ii) ten percent (10%) of the aggregate
Advances Outstanding as of the date that the personal liability is incurred;
(17)    failure to pay the Release Price for the Mortgaged Property known as
Brookdale Santa Monica upon (i) subordination of the Ground Lease to a fee
mortgage on the Mortgaged Property known as Brookdale Santa Monica unless
Borrower has obtained commercially reasonable non-disturbance agreements from
the fee mortgagee in form and substance satisfactory to Lender which documents
are filed concurrently with the recording of the fee mortgage or (ii) Ground
Lessor’s effective and legally binding rejection of the Ground Lease extension
exercised by Borrower on November 20, 2015; provided that Borrower’s liability
under this clause (17) shall be limited to the lesser of (i) the Release Price
for the Santa Monica Mortgaged Property, and (ii) ten percent (10%) of the
aggregate Advances Outstanding as of the date that the personal liability is
incurred; or

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(18)    failure of Borrower to obtain a ground lease estoppel from the Ground
Lessor under the Ground Lease; provided that Borrower’s liability under this
clause (18) shall be limited to the lesser of (i) the Release Price for the
Santa Monica Mortgaged Property if Borrower elects to release such Mortgaged
Property from the Collateral Pool in accordance with the Mortgaged Property
Release Schedule, and (ii) ten percent (10%) of the aggregate Advances
Outstanding as of the date that the personal liability is incurred;
(19)    failure to pay any amounts owing by Borrower to repair any casualty
damages to the Mortgaged Property known as Brookdale Santa Monica as required
under the Ground Lease in the event Lender requires the casualty proceeds be
used to prepay the Loan; provided that Borrower’s liability under this clause
(19) shall be limited to the lesser of (i) the Release Price for the Santa
Monica Mortgaged Property if Borrower elects to release such Mortgaged Property
from the Collateral Pool in accordance with the Mortgaged Property Release
Schedule less the amount of any casualty proceeds actually received by Lender in
connection with such casualty, and (ii) ten percent (10%) of the aggregate
Advances Outstanding as of the date that the personal liability is incurred; or
(20)    failure to pay any loss, expense, cost, liability or damage suffered by
Lender in the event Lender forecloses the Security Instrument for the Mortgaged
Property known as Brookdale Santa Monica and is required to make any payments
under the Ground Lease on account of Borrower’s default under the Ground Lease
or Lender is prevented from foreclosing by Landlord’s failure to approve Lender
as a transferee under the Ground Lease; provided that Borrower’s liability under
this clause (20) shall be limited to the lesser of (i) the Release Price for the
Santa Monica Mortgaged Property if Borrower elects to release such Mortgaged
Property from the Collateral Pool in accordance with the Mortgaged Property
Release Schedule, and (ii) ten percent (10%) of the aggregate Advances
Outstanding as of the date that the personal liability is incurred.
Notwithstanding the foregoing, Borrower shall not have personal liability under
clauses (1), (3), or (5), above to the extent that Borrower lacks the legal
right to direct the disbursement of the applicable funds due to an involuntary
Bankruptcy Event or Applicable Law with respect to Borrower that occurs without
the consent, encouragement, or active participation of Affiliated Property
Operator, Guarantor, Key Principal or any Borrower Affiliate.
(b)    Full Personal Liability (Full Recourse).
Borrower shall be personally liable to Lender for the repayment of all of the
Indebtedness, and the Advances shall be fully recourse to Borrower, upon the
occurrence of any of the following:
(1)    failure to comply with each of the Single Purpose requirements of:
(i)    Section 4.02(d) (1), (2), (3), (5), (6) or (16) (Borrower Status –
Covenants – Single Purpose Status) of this Master Agreement; and

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(ii)    Section 4.02(d)(4) and (7)-(15) (Borrower Status – Covenants – Single
Purpose Status) of this Master Agreement and a court of competent jurisdiction
holds or determines that such failure or combination of failures is the basis,
in whole or in part, for the substantive consolidation of the assets and
liabilities of the Borrower or any general partner or member of Borrower with
the assets and liabilities of a debtor pursuant to Title 11 of the Bankruptcy
Code;
(2)    a Transfer (other than a transfer consisting solely of a breach of the
covenants related to Section 7.02 (b)(1) or Section 7.02(b)(2), or a conveyance
of a Mortgaged Property at a Foreclosure Event pursuant to the Security
Instrument and this Master Agreement) that is not permitted under this Master
Agreement or any other Loan Document;
(3)    the occurrence of any Bankruptcy Event with respect to Borrower, its
general partner, if applicable, or Affiliated Property Operator (other than an
acknowledgement in writing as described in clause (b) of the definition of
“Bankruptcy Event”); provided, however, in the event of an involuntary
Bankruptcy Event with respect to Borrower or its general partners, or Affiliated
Property Operator, Borrower shall only be personally liable if such involuntary
Bankruptcy Event occurs with the consent, encouragement or active participation
of Borrower, Affiliated Property Operator, Guarantor, Key Principal, or any
Borrower Affiliate;
(4)    fraud, written intentional material misrepresentation or intentional
material omission by Borrower, Affiliated Property Operator, Guarantor, Key
Principal, or any officer, director, partner, manager, member, shareholder (for
so long as the ownership of Guarantor or Key Principal consists entirely of
publicly traded stock, shareholders of such publically traded stock shall be
limited to Major Shareholders) or trustee of Borrower, Affiliated Property
Operator, Guarantor, or Key Principal in connection with any application for or
creation of the Indebtedness; or
(5)    fraud, written intentional material misrepresentation or intentional
material omission by Borrower, Affiliated Property Operator, Guarantor, Key
Principal, or any officer, director, partner, manager, member, shareholder (for
so long as the ownership of Guarantor or Key Principal consists entirely of
publicly traded stock, shareholders of such publicly traded stock shall be
limited to Major Shareholders) or trustee of Borrower, Affiliated Property
Operator, Guarantor, or Key Principal in connection with on-going financial or
other reporting required by the Loan Documents, or any request for action or
consent by Lender.
Section 3.03    Personal Liability for Indemnity Obligations.
Borrower shall be personally and fully liable to Lender for Borrower’s indemnity
obligations under Section 13.01(e) (Replacement Reserves and Repairs –
Indemnification) of this Master Agreement, the Environmental Indemnity Agreement
and any other express indemnity

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obligations provided by Borrower under any Loan Document. Borrower’s liability
for such indemnity obligations shall not be limited by the amount of the
Indebtedness, the repayment of the Indebtedness, or otherwise, provided that
Borrower’s liability for such indemnities shall not include any loss caused by
the gross negligence or willful misconduct of Lender or Loan Servicer as
determined by a court of competent jurisdiction pursuant to a final
non-appealable court order. Notwithstanding the foregoing, Borrower and
Guarantor shall have no liability under this Section 3.03, the Guaranty or the
Environmental Indemnity Agreement solely on account of acts or omissions
committed by the Lender, its agents or a receiver following a foreclosure, deed
in lieu of foreclosure or appointment of a receiver on all or a portion of a
Mortgaged Property (or any purchaser at foreclosure or any transferee of
Lender).
Section 3.04    Lender’s Right to Forego Rights Against Mortgaged Property.
To the extent that Borrower has personal liability under this Master Agreement
or any other Loan Document, Lender may exercise its rights against Borrower
personally to the fullest extent permitted by Applicable Law without regard to
whether Lender has exercised any rights against any Mortgaged Property or any
other security, or pursued any rights against Guarantor, or pursued any other
rights available to Lender under this Master Agreement, any other Loan Document,
or Applicable Law. For purposes of this Section 3.04 (Lender’s Right to Forego
Rights Against Mortgaged Property) only, the term “Mortgaged Property” shall not
include any funds that have been applied by Borrower or Property Operator as
required or permitted by this Master Agreement prior to the occurrence of an
Event of Default, or that Borrower was unable to apply as required or permitted
by this Master Agreement because of a Bankruptcy Event with respect to Borrower.
To the fullest extent permitted by Applicable Law, in any action to enforce
Borrower’s personal liability under this ARTICLE 3 (Personal Liability),
Borrower waives any right to set off the value of a Mortgaged Property against
such personal liability.
Section 3.05    Borrower Agency Provisions.
(a)    Each Borrower shall irrevocably designate Borrower Agent to be its agent
and in such capacity to receive on behalf of Borrower all proceeds, receive all
notices on behalf of Borrower under this Master Agreement, make all requests
under this Master Agreement, and execute, deliver, and receive all instruments,
certificates, requests, documents, amendments, writings, and further assurances
now or hereafter required hereunder, on behalf of such Borrower, and hereby
authorizes Lender to pay over all proceeds hereunder in accordance with the
request of Borrower Agent. Each Borrower hereby acknowledges that all notices
required to be delivered by Lender to any Borrower shall be delivered to
Borrower Agent and thereby shall be deemed to have been received by such
Borrower.
(b)    The handling of this Master Agreement as a co-borrowing facility with a
Borrower Agent in the manner set forth in this Master Agreement is solely as an
accommodation to each of Borrower and Guarantor and is at their mutual request.
Lender shall not incur liability to Borrower or Guarantor as a result thereof.
To induce Lender to do so and in consideration thereof, each Borrower hereby
indemnifies Lender and holds Lender harmless from and against any and all
liabilities, expenses, losses, damages, and claims of damage or injury asserted
against Lender by

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any Person arising from or incurred by reason of Borrower Agent handling of the
financing arrangements of Borrower as provided herein, reliance by Lender on any
request or instruction from Borrower Agent or any other action taken by Lender
with respect to this Section 3.05 (Borrower Agency Provisions) except due to
willful misconduct or gross negligence of the indemnified party as determined by
a court of competent jurisdiction pursuant to a final, non-appealable court
order.
Section 3.06    Joint and Several Obligation; Cross-Guaranty.
Notwithstanding anything contained in this Master Agreement or the other Loan
Documents to the contrary (but subject to the provisions of Section 3.01
(Non-Recourse Liability; Exceptions), Section 3.02(a) (Personal Liability Based
on Lender’s Loss (Partial Recourse)) and Section 3.02(b) (Full Personal
Liability (Full Recourse)), the last sentence of this Section 3.06 (Joint and
Several Obligation; Cross-Guaranty) and the provisions of Section 3.13 (Maximum
Liability of Each Borrower), each Borrower shall have joint and several
liability for the Indebtedness. Notwithstanding the intent of all of the parties
to this Master Agreement that the Indebtedness of each Borrower under this
Master Agreement and the other Loan Documents shall be joint and several
obligations of each Borrower, each Borrower, on a joint and several basis,
hereby irrevocably guarantees on a non-recourse basis, subject to the exceptions
to non-recourse provisions of Section 3.01 (Non-Recourse Liability; Exceptions),
Section 3.02(a) (Personal Liability Based on Lender’s Loss (Partial Recourse))
and Section 3.02(b) (Full Personal Liability (Full Recourse)), to Lender and its
successors and assigns, the full and prompt payment (whether at stated maturity,
by acceleration or otherwise) and performance of, all Indebtedness owed or
hereafter owing to Lender by each other Borrower. Each Borrower agrees that its
non-recourse guaranty obligation hereunder is an unconditional guaranty of
payment and performance and not merely a guaranty of collection. The
Indebtedness of each Borrower under this Master Agreement shall not be subject
to any counterclaim, set-off, recoupment, deduction, cross-claim, or defense
based upon any claim any Borrower may have against Lender or any other Borrower.
Section 3.07    Waivers With Respect to Other Borrower Secured Obligation.
To the extent that a Security Instrument or any other Loan Document executed by
one Borrower secures an Obligation of another Borrower (the “Other Borrower
Secured Obligation”), or to the extent that a Borrower has guaranteed the debt
of another Borrower pursuant to Article 3 (Personal Liability), Borrower who
executed such Loan Document or guaranteed such debt (the “Waiving Borrower”)
hereby agrees to the extent permitted by law, to the provisions of this Section
3.07 (Waivers with Respect to Other Borrower Secured Obligation). To the extent
that any Mortgaged Properties are located in California, and to the extent
permitted by law, the references to the California statutes below shall apply to
this Master Agreement and any California Security Instrument securing or
encumbering a Mortgaged Property located in California; otherwise the California
statutes referenced below shall have no effect on this Master Agreement or any
other Loan Document. All references in Article 3 (Personal Liability) to
California law are only applicable if any Mortgaged Property is located in
California. To the maximum extent permitted by Applicable Law:

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(a)    The Waiving Borrower hereby waives any right it may now or hereafter have
to require the beneficiary, assignee, or other secured party under such Loan
Document, as a condition to the exercise of any remedy or other right against it
thereunder or under any other Loan Document executed by the Waiving Borrower in
connection with the Other Borrower Secured Obligation: (1) to proceed against
any other Borrower or any other Person, or against any other collateral assigned
to Lender by any Borrower or any other Person; (2) to pursue any other right or
remedy in Lender’s power; (3) to give notice of the time, place, or terms of any
public or private sale of real or personal property collateral assigned to
Lender by any other Borrower or any other Person, or otherwise to comply with
Section 9615 of the California Commercial Code (as modified or recodified from
time to time) with respect to any such personal property collateral located in
the State of California; or (4) to make or give (except as otherwise expressly
provided in the Security Documents) any presentment, demand, protest, notice of
dishonor, notice of protest, or other demand or notice of any kind in connection
with the Other Borrower Secured Obligation or any collateral for the Other
Borrower Secured Obligation.
(b)    The Waiving Borrower hereby waives any defense it may now or hereafter
have that relates to: (1) any disability or other defense of any other Borrower
or any other Person; (2) the cessation, from any cause other than full
performance, of the Other Borrower Secured Obligation; (3) the application of
the proceeds of the Other Borrower Secured Obligation, by any other Borrower or
any other Person, for purposes other than the purposes represented to the
Waiving Borrower by any other Borrower or any other Person, or otherwise
intended or understood by the Waiving Borrower or any other Borrower; (4) any
act or omission by Lender which directly or indirectly results in or contributes
to the release of any other Borrower or any other Person or any collateral for
any Other Borrower Secured Obligation; (5) the unenforceability or invalidity of
any Security Document or Loan Document (other than the Security Instrument
executed by the Waiving Borrower that secures the Other Borrower Secured
Obligation) or guaranty with respect to any Other Borrower Secured Obligation,
or the lack of perfection or continuing perfection or lack of priority of any
Lien (other than the Lien of the Security Instrument executed by the Waiving
Borrower that secures the Other Borrower Secured Obligation) which secures any
Other Borrower Secured Obligation; (6) any failure of Lender to marshal assets
in favor of the Waiving Borrower or any other Person; (7) any modification of
any Other Borrower Secured Obligation, including any renewal, extension,
acceleration, or increase in interest rate; (8) any and all rights and defenses
arising out of an election of remedies by Lender, even though that election of
remedies, such as a nonjudicial foreclosure with respect to security for a
guaranteed obligation, has destroyed the Waiving Borrower’s rights of
subrogation and reimbursement against the principal by the operation of Section
580d of the California Code of Civil Procedure or otherwise; (9) any law which
provides that the obligation of a surety or guarantor must neither be larger in
amount nor in other respects more burdensome than that of the principal or which
reduces a surety’s or guarantor’s obligation in proportion to the principal
obligation; (10) any failure of Lender to file or enforce a claim in any
bankruptcy or other proceeding with respect to any Person; (11) the election by
Lender, in any bankruptcy proceeding of any Person, of the application or
non-application of Section 1111(b)(2) of the Bankruptcy Code; (12) any extension
of credit or the grant of any lien under Section 364 of the Bankruptcy Code;
(13) any use of cash collateral under Section 363 of the Bankruptcy Code; or
(14) any agreement or stipulation with respect to the provision of

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adequate protection in any bankruptcy proceeding of any Person. The Waiving
Borrower further waives any and all rights and defenses that it may have because
the Other Borrower Secured Obligation is secured by real property; this means,
among other things, that: (A) Lender may collect from the Waiving Borrower
without first foreclosing on any real or personal property collateral pledged by
any other Borrower; (B) if Lender forecloses on any real property collateral
pledged by any other Borrower, then (i) the amount of the Other Borrower Secured
Obligation may be reduced only by the price for which that collateral is sold at
the foreclosure sale, even if the collateral is worth more than the sale price,
and (ii) Lender may foreclose on the real property encumbered by the Security
Instrument executed by the Waiving Borrower and securing the Other Borrower
Secured Obligation, or otherwise collect from the Waiving Borrower, even if
Lender, by foreclosing on the real property collateral of any one or more of the
other Borrowers, has destroyed any right the Waiving Borrower may have to
collect from such other Borrowers. Subject to the last sentence of Section 3.06
(Joint and Several Obligation; Cross-Guaranty), the foregoing sentence is an
unconditional and irrevocable waiver of any rights and defenses the Waiving
Borrower may have because the Other Borrower Secured Obligation is secured by
real property. These rights and defenses being waived by the Waiving Borrower
include, but are not limited to, any rights or defenses based upon Section 580a,
580b, 580d, or 726 of the California Code of Civil Procedure. Without limiting
the generality of the foregoing or any other provision hereof, the Waiving
Borrower further expressly waives, except as provided in Section 3.07(g)
(Waivers with Respect to Other Borrower Secured Obligation) below, to the extent
permitted by law any and all rights and defenses that might otherwise be
available to it under California Civil Code Sections 2787 to 2855, inclusive,
2899 and 3433, or under California Code of Civil Procedure Sections 580a, 580b,
580d, and 726, or any of such sections;
(c)    The Waiving Borrower hereby waives any and all benefits and defenses
under California Civil Code Section 2810 and agrees that by doing so the
Security Instrument executed by the Waiving Borrower and securing the Other
Borrower Secured Obligation shall be and remain in full force and effect even if
one or more of the other Borrowers had no liability at the time of incurring the
Other Borrower Secured Obligation, or thereafter ceases to be liable. The
Waiving Borrower hereby waives any and all benefits and defenses under
California Civil Code Section 2809 and agrees that by doing so the Waiving
Borrower’s liability may be larger in amount and more burdensome than that of
any one or more of the other Borrowers. The Waiving Borrower hereby waives the
benefit of all principles or provisions of law that are or might be in conflict
with the terms of any of its waivers, and agrees that the Waiving Borrower’s
waivers shall not be affected by any circumstances that might otherwise
constitute a legal or equitable discharge of a surety or a guarantor. The
Waiving Borrower hereby waives the benefits of any right of discharge and all
other rights and defenses under any and all statutes or other laws relating to
guarantors or sureties, to the fullest extent permitted by law, diligence in
collecting the Other Borrower Secured Obligation, presentment, demand for
payment, protest, all notices with respect to the Other Borrower Secured
Obligation that may be required by statute, rule of law, or otherwise to
preserve Lender’s rights against the Waiving Borrower hereunder, including
notice of acceptance, notice of any amendment of the Loan Documents evidencing
the Other Borrower Secured Obligation, notice of the occurrence of any default
or Event of Default, notice of intent to accelerate, notice of acceleration,
notice of dishonor, notice of foreclosure, notice of protest, notice of the
incurring by

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the other Borrower of any obligation or indebtedness and all rights to require
Lender to (1) proceed against the other Borrower, (2) proceed against any
general partner of the other Borrower, (3) proceed against or exhaust any
collateral held by Lender to secure the Other Borrower Secured Obligation, or
(4) if the other Borrower is a partnership, pursue any other remedy it may have
against the other Borrower, or any general partner of the other Borrower,
including any and all benefits under California Civil Code Sections 2845, 2849,
and 2850;
(d)    The Waiving Borrower understands that the exercise by Lender of certain
rights and remedies contained in a Security Instrument executed by any other
Borrower (such as a nonjudicial foreclosure sale) may affect or eliminate the
Waiving Borrower’s right of subrogation against such other Borrower and that the
Waiving Borrower may therefore incur a partially or totally nonreimburseable
liability. Nevertheless, the Waiving Borrower hereby authorizes and empowers
Lender to exercise, in its sole and absolute discretion, any right or remedy, or
any combination thereof, that may then be available, since it is the intent and
purpose of the Waiving Borrower that its waivers shall be absolute, independent
and unconditional under any and all circumstances;
(e)    In accordance with Section 2856 of the California Civil Code, the Waiving
Borrower also waives any right or defense based upon an election of remedies by
Lender, even though such election (e.g., nonjudicial foreclosure with respect to
any collateral held by Lender to secure repayment of the Other Borrower Secured
Obligation) destroys or otherwise impairs the subrogation rights of the Waiving
Borrower to any right to proceed against one or more of the other Borrowers for
reimbursement by operation of Section 580d of the California Code of Civil
Procedure or otherwise;
(f)    Subject to the last sentence of Section 3.06 (Joint and Several
Obligation; Cross-Guaranty), in accordance with Section 2856 of the California
Civil Code, the Waiving Borrower waives any and all other rights and defenses
available to the Waiving Borrower by reason of Sections 2787 through 2855,
inclusive, of the California Civil Code, including any and all rights or
defenses the Waiving Borrower may have by reason of protection afforded to one
or more of the other Borrowers with respect to the applicable Other Borrower
Secured Obligation pursuant to the antideficiency or other laws of the State of
California limiting or discharging such Other Borrower Secured Obligation,
including Sections 580a, 580b, 580d, and 726 of the California Code of Civil
Procedure;
(g)    In accordance with Section 2856 of the California Civil Code and pursuant
to any other Applicable Law, the Waiving Borrower agrees to withhold the
exercise of any and all subrogation, contribution, and reimbursement rights
against all other Borrowers, against any other Person, and against any
collateral or security for the Other Borrower Secured Obligation, including any
such rights pursuant to Sections 2847 and 2848 of the California Civil Code,
until the Other Borrower Secured Obligation has been indefeasibly paid and
satisfied in full, all obligations owed to Lender under the Loan Documents have
been fully performed, and Lender has released, transferred or disposed of all of
its right, title, and interest in such collateral or security;

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(h)    Each Borrower hereby irrevocably and unconditionally agrees that,
notwithstanding Section 3.07(g) (Waivers with Respect to Other Borrower Secured
Obligation) hereof, in the event, and to the extent, that its agreement and
waiver set forth in Section 3.07(g) (Waivers with Respect to Other Borrower
Secured Obligation) is found by a court of competent jurisdiction to be void or
voidable for any reason and such Borrower has any subrogation or other rights
against any other Borrower, any such claims, direct or indirect, that such
Borrower may have by subrogation rights or other form of reimbursement,
contribution, or indemnity, against any other Borrower or to any security or any
such Borrower, shall be, and such rights, claims, and indebtedness are hereby,
deferred, postponed, and fully subordinated in time and right of payment to the
prior payment, performance, and satisfaction in full of the Indebtedness. Until
payment and performance in full with interest (including post-petition interest
in any case under any chapter of the Bankruptcy Code) of the Indebtedness, each
Borrower agrees not to accept any payment or satisfaction of any kind of
Indebtedness of any other Borrower in respect of any such subrogation rights
arising by virtue of payments made pursuant to this Article 3 (Personal
Liability), and hereby assigns such rights or indebtedness to Lender, including
(1) the right to file proofs of claim and to vote thereon in connection with any
case under any chapter of the Bankruptcy Code and (2) the right to vote on any
plan of reorganization. In the event that any payment on account of any such
subrogation rights shall be received by any Borrower in violation of the
foregoing, such payment shall be held in trust for the benefit of Lender, and
any amount so collected must be turned over to Lender for, at Lender’s option,
application to the Indebtedness; and
(i)    At any time without notice to the Waiving Borrower, and without affecting
or prejudicing the right of Lender to proceed against the Collateral described
in any Loan Document executed by the Waiving Borrower and securing the Other
Borrower Secured Obligation, (1) the time for payment of the principal of or
interest on, or the performance of, the Other Borrower Secured Obligation may be
extended or the Other Borrower Secured Obligation may be renewed in whole or in
part; (2) the time for any other Borrower’s performance of or compliance with
any covenant or agreement contained in the Loan Documents evidencing the Other
Borrower Secured Obligation, whether presently existing or hereinafter entered
into, may be extended or such performance or compliance may be waived; (3) the
maturity of the Other Borrower Secured Obligation may be accelerated as provided
in the related Note or any other related Loan Document; (4) the related Note or
any other related Loan Document may be modified or amended by Lender and the
applicable other Borrower in any respect, including an increase in the principal
amount; and (5) any security for the Other Borrower Secured Obligation may be
modified, exchanged, surrendered or otherwise dealt with or additional security
may be pledged or mortgaged for the Other Borrower Secured Obligation.
(j)    It is agreed among each Borrower and Lender that all of the foregoing
waivers are of the essence of the transaction contemplated by this Master
Agreement and the Loan Documents and that but for the provisions of this Article
3 (Personal Liability) and such waivers Lender would decline to enter into this
Master Agreement.

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Section 3.08    No Impairment.
Each Borrower agrees that the provisions of this Article 3 (Personal Liability)
are for the benefit of Lender and its successors and assigns, and nothing herein
contained shall impair, as between any other Borrower and Lender, the
obligations of such other Borrower under the Loan Documents.
Section 3.09    Election of Remedies.
(a)    Lender, in its discretion, may (1) bring suit against any one or more
Borrowers, jointly and severally, without any requirement that Lender first
proceed against any other Borrower or any other Person; (2) compromise or settle
with any one or more Borrowers, or any other Person, for such consideration as
Lender may deem proper; (3) release one or more Borrowers, or any other Person,
from liability; and (4) otherwise deal with any Borrower and any other Person,
or any one or more of them, in any manner, or resort to any of the Collateral at
any time held by it for performance of the Indebtedness or any other source or
means of obtaining payment of the Indebtedness, and no such action shall impair
the rights of Lender to collect from any Borrower any amount guaranteed by any
Borrower under this Article 3 (Personal Liability).
(b)    If, in the exercise of any of its rights and remedies, Lender shall
forfeit any of its rights or remedies, including its rights to enter a
deficiency judgment against any Borrower or any other Person, whether because of
any Applicable Law pertaining to “election of remedies” or the like, each
Borrower hereby consents to such action by Lender and waives any claim based
upon such action, even if such action by Lender shall result in a full or
partial loss of any rights of subrogation that each Borrower might otherwise
have had but for such action by Lender. Any election of remedies that results in
the denial or impairment of the right of Lender to seek a deficiency judgment
against any Borrower shall not impair any other Borrower’s obligation to pay the
full amount of the Indebtedness. In the event Lender shall bid at any
foreclosure or trustee’s sale or at any private sale permitted by law or any of
the Loan Documents, Lender may bid all or less than the amount of the
Indebtedness and the amount of such bid need not be paid by Lender but shall be
credited against the Indebtedness. The amount of the successful bid at any such
sale, whether Lender or any other party is the successful bidder, shall be
conclusively deemed to be the fair market value of the Collateral and the
difference between such bid amount and the remaining balance of the Indebtedness
shall be conclusively deemed to be the amount of the Indebtedness guaranteed
under this Article 3 (Personal Liability), notwithstanding that any present or
future law or court decision or ruling may have the effect of reducing the
amount of any deficiency claim to which Lender might otherwise be entitled but
for such bidding at any such sale.
Section 3.10    Subordination of Other Obligations.
(a)    Each Borrower hereby irrevocably and unconditionally agrees that all
amounts payable from time to time to such Borrower by any other Borrower
pursuant to any agreement, whether secured or unsecured, whether of principal,
interest, or otherwise, other than the amounts referred to in this Article 3
(Personal Liability) (collectively, the “Subordinated Obligations”), shall be
and such rights, claims, and indebtedness are, hereby deferred, postponed, and
fully

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subordinated in time and right of payment to the prior payment, performance, and
satisfaction in full of the Indebtedness; provided, however, that payments may
be received by any Borrower in accordance with, and only in accordance with, the
provisions of Section 3.10 (Subordination of Other Obligations) hereof.
(b)    Until the Indebtedness has been finally paid in full or fully performed
and all the Loan Documents have been terminated, each Borrower irrevocably and
unconditionally agrees it will not ask, demand, sue for, take, or receive,
directly or indirectly, by set-off, redemption, purchase, or in any other manner
whatsoever, any payment with respect to, or any security or guaranty for, the
whole or any part of the Subordinated Obligations, and in issuing documents,
instruments, or agreements of any kind evidencing the Subordinated Obligations,
each Borrower hereby agrees that it will not receive any payment of any kind on
account of the Subordinated Obligations, so long as any of the Indebtedness is
outstanding or any of the terms and conditions of any of the Loan Documents are
in effect; provided, however, that, notwithstanding anything to the contrary
contained herein, if no Potential Event of Default or Event of Default has
occurred and is continuing under any of the Loan Documents, then payments may be
received by such Borrower in respect of the Subordinated Obligations in
accordance with the stated terms thereof. Except as aforesaid, each Borrower
agrees not to accept any payment or satisfaction of any kind of indebtedness of
any other Borrower in respect of the Subordinated Obligations and hereby assigns
such rights or indebtedness to Fannie Mae, including the right to file proofs of
claim and to vote thereon in connection with any case under any chapter of the
Bankruptcy Code, including the right to vote on any plan of reorganization. In
the event that any payment on account of Subordinated Obligations shall be
received by any Borrower in violation of the foregoing, such payment shall be
held in trust for the benefit of Lender, and any amount so collected shall be
turned over to Lender upon demand.
Section 3.11    Insolvency and Liability of Other Borrower.
So long as any of the Indebtedness is Outstanding, if a petition under any
chapter of the Bankruptcy Code is filed by or against any Borrower (the “Subject
Borrower”), each other Borrower (each, an “Other Borrower”) agrees to file all
claims against the Subject Borrower in any bankruptcy or other proceeding in
which the filing of claims is required by law in connection with indebtedness
owed by the Subject Borrower and to assign to Lender all rights thereunder up to
the amount of such indebtedness. In all such cases, the Person or Persons
authorized to pay such claims shall pay to Lender the full amount thereof and
Lender agrees to pay such Other Borrower any amounts received in excess of the
amount necessary to pay the Indebtedness. Each Other Borrower hereby assigns to
Lender all of such Other Borrower’s rights to all such payments to which such
Other Borrower would otherwise be entitled but not to exceed the full amount of
the Indebtedness. In the event that, notwithstanding the foregoing, any such
payment shall be received by any Other Borrower before the Indebtedness shall
have been finally paid in full, such payment shall be held in trust for the
benefit of and shall be paid over to Lender upon demand. Furthermore,
notwithstanding the foregoing, the liability of each Borrower hereunder shall in
no way be affected by:

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(a)    the release or discharge of any Other Borrower in any creditors’
receivership, bankruptcy, or other proceedings; or
(b)    the impairment, limitation, or modification of the liability of any Other
Borrower or the estate of any Other Borrower in bankruptcy resulting from the
operation of any present or future provisions of any chapter of the Bankruptcy
Code or other statute or from the decision in any court.
Section 3.12    Preferences, Fraudulent Conveyances, Etc.
If Lender is required to refund, or voluntarily refunds, any payment received
from any Borrower because such payment is or may be avoided, invalidated,
declared fraudulent, set aside, or determined to be void or voidable as a
preference, fraudulent conveyance, impermissible setoff, or a diversion of trust
funds under the Insolvency Laws or for any similar reason, including any
judgment, order, or decree of any court or administrative body having
jurisdiction over any Borrower or any of its property, or upon or as a result of
the appointment of a receiver, intervenor, custodian, or conservator of, or
trustee or similar officer for, any Borrower or any substantial part of its
property, or otherwise, or any statement or compromise of any claim effected by
Lender with any Borrower or any other claimant (a “Rescinded Payment”), then
each Other Borrower’s liability to Lender shall continue in full force and
effect, or each Other Borrower’s liability to Lender shall be reinstated and
renewed, as the case may be, with the same effect and to the same extent as if
the Rescinded Payment had not been received by Lender, notwithstanding the
cancellation or termination of any of the Loan Documents, and regardless of
whether Lender contested the order requiring the return of such payment. In
addition, each Other Borrower shall pay, or reimburse Lender for, all expenses
(including all reasonable attorneys’ fees, court costs, and related
disbursements) incurred by Lender in the defense of any claim that a payment
received by Lender in respect of all or any part of the Indebtedness must be
refunded. The provisions of this Section 3.12 (Preferences, Fraudulent
Conveyances, Etc.) shall survive the termination of the Loan Documents and any
satisfaction and discharge of any Borrower by virtue of any payment, court
order, or any federal or state law.
Section 3.13    Maximum Liability of Each Borrower.
Notwithstanding anything contained in this Master Agreement or any other Loan
Document to the contrary, if the obligations of any Borrower under this Master
Agreement or any of the other Loan Documents or any Security Instruments granted
by any Borrower are determined to exceed the reasonably equivalent value
received by such Borrower in exchange for such obligations or grant of such
Security Instruments under any Fraudulent Transfer Law (as hereinafter defined),
then the liability of such Borrower shall be limited to a maximum aggregate
amount equal to the largest amount that would not render its obligations under
this Master Agreement or all the other Loan Documents subject to avoidance as a
fraudulent transfer or conveyance under Section 548 of Title 11 of the United
States Code or any applicable provisions of comparable state law (collectively,
the “Fraudulent Transfer Laws”), in each case after giving effect to all other
liabilities of such Borrower, contingent or otherwise, that are relevant under
the Fraudulent Transfer Laws (specifically excluding, however, any liabilities
of such Borrower in

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respect of Indebtedness to any other Borrower or any other Person that is an
affiliate of the other Borrower to the extent that such Indebtedness would be
discharged in an amount equal to the amount paid by such Borrower in respect of
the Indebtedness) and after giving effect (as assets) to the value (as
determined under the applicable provisions of the Fraudulent Transfer Laws) of
any rights to subrogation, reimbursement, indemnification, or contribution of
such Borrower pursuant to Applicable Law or pursuant to the terms of any
agreement including the Contribution Agreement.
Section 3.14    Liability Cumulative.
The liability of each Borrower under this Article 3 (Personal Liability) is in
addition to and shall be cumulative with all liabilities of such Borrower to
Lender under this Master Agreement and all the other Loan Documents to which
such Borrower is a party or in respect of any Indebtedness of any other
Borrower.
ARTICLE 4    
BORROWER AND PROPERTY OPERATOR STATUS
Section 4.01    Representations and Warranties.
The representations and warranties made by Borrower to Lender in this Section
4.01 (Borrower Status – Representations and Warranties) are made as of each
Effective Date and are true and correct except as disclosed on the Exceptions to
Representations and Warranties Schedule.
(a)    Due Organization and Qualification; Organizational Agreements.
(1)    Each of Borrower and Affiliated Property Operator is validly existing and
qualified to transact business and is in good standing in (A) the state in which
it is formed or organized, (B) the Property Jurisdiction and (C) each other
jurisdiction that qualification or good standing is required according to
Applicable Law to conduct its business with respect to the Mortgaged Property,
in each case, where the failure to be so qualified or in good standing would
adversely affect (i) Borrower’s ownership or operation of its Mortgaged
Property; (ii) Affiliated Property Operator’s management, leasing, or operation
(as applicable) of its Mortgaged Property; (iii) validity or enforceability of,
or the ability of Borrower to perform its obligations under, this Master
Agreement or any other Loan Document; or (iv) validity or enforceability of, or
the ability of Affiliated Property Operator to perform its obligations under,
the Facility Operating Agreement. The sole member, managing member or general
partner of Borrower, as applicable, is validly existing and qualified to
transact business and is in good standing in the state in which it is organized
and in each other jurisdiction in which such qualification and/or standing is
necessary to the conduct of its business.
(2)    The members or partners, as applicable, of Borrower and the percentage of
their Ownership Interests are as set forth in the Ownership Interests Schedule
attached hereto. True, correct and complete Organizational Documents of each
Borrower Entity,

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Identified Party, and Affiliated Property Operator have been delivered to Lender
prior to each Effective Date.
(b)    Location.
Borrower’s General Business Address is Borrower’s principal place of business
and principal office. Guarantor’s General Business Address is Guarantor’s
principal place of business and principal office. Key Principal’s General
Business Address is Key Principal’s principal place of business and principal
office. Property Operator’s General Business Address is Property Operator’s
principal place of business and principal office.
(c)    Power and Authority.
(1)    Each Borrower has the requisite power and authority:
(A)    to own its Mortgaged Property and to carry on its business as now
conducted and as contemplated to be conducted in connection with the performance
of its obligations under this Master Agreement and under the other Loan
Documents to which it is a party; and
(B)    to execute and deliver this Master Agreement and the other Loan Documents
to which it is a party, and to carry out the transactions contemplated by this
Master Agreement and the other Loan Documents to which it is a party; and
(C)    to execute and deliver the Facility Operating Agreement and to carry out
the transactions contemplated by the Facility Operating Agreement.
(2)    Affiliated Property Operator has the requisite power and authority:
(A)    to manage, lease, and operate (as applicable) its Mortgaged Property and
to carry on its business as now conducted and as contemplated to be conducted in
connection with the performance or its obligations under the Facility Operating
Agreement; and
(B)    to execute and deliver the Facility Operating Agreement, to carry out the
transactions contemplated by the Facility Operating Agreement, and to facilitate
Borrower’s compliance with the requirements of this Master Agreement and the
other Loan Documents.
(d)    Due Authorization.
(1)    The execution, delivery, and performance by Borrower of this Master
Agreement, the Facility Operating Agreement, and the other Loan Documents have
been duly authorized by all necessary action and proceedings by or on behalf of
Borrower, and no further approvals or filings of any kind, including any
approval of or filing with any Governmental Authority, are required by or on
behalf of Borrower as a condition to the

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valid execution, delivery, and performance by Borrower of this Master Agreement,
the Facility Operating Agreement, or any of the other Loan Documents, except
filings required to perfect and maintain the liens to be granted under the Loan
Documents and routine filings to maintain the good standing and existence of
Borrower and its Licenses.
(2)    The execution, delivery, and performance by Affiliated Property Operator
of the Facility Operating Agreement and the SASA have been duly authorized by
all necessary action and proceedings by or on behalf of Affiliated Property
Operator, and no further approvals or filings of any kind, including any
approval of or filing with any Governmental Authority, are required by or on
behalf of Affiliated Property Operator as a condition to the valid execution,
delivery, and performance by Affiliated Property Operator of the Facility
Operating Agreement and the SASA, except filings required to perfect and
maintain the liens to be granted under the SASA and routine filings to maintain
the good standing and existence of Affiliated Property Operator and its
Licenses.
(e)    Valid and Binding Obligations.
(1)    This Master Agreement, the other Loan Documents, and the Facility
Operating Agreement have been duly executed and delivered by Borrower and
constitute the legal, valid, and binding obligations of Borrower, enforceable
against Borrower in accordance with their respective terms, except as such
enforceability may be limited by applicable Insolvency Laws or by the exercise
of discretion by any court.
(2)    The Facility Operating Agreement and the SASA have been duly executed and
delivered by Affiliated Property Operator and constitute the legal, valid, and
binding obligations of Affiliated Property Operator, enforceable against
Affiliated Property Operator in accordance with their respective terms, except
as such enforceability may be limited by applicable Insolvency Laws or by the
exercise of discretion by any court.
(f)    Effect of Master Agreement on Financial Condition.
Neither Borrower nor Borrower’s general partner or sole member will be rendered
Insolvent by the transactions contemplated by the provisions of this Master
Agreement and the other Loan Documents, and the Facility Operating Agreement
obligations will not render Affiliated Property Operator Insolvent. Borrower has
sufficient working capital, including proceeds from the Advances, cash flow from
the Mortgaged Properties, including the Facility Operating Agreement, or other
sources, not only to adequately maintain the Mortgaged Properties in accordance
with the terms of the Loan Documents and the Facility Operating Agreement, but
also to pay all of Borrower’s outstanding debts as they come due, including all
Debt Service Amounts, exclusive of Borrower’s ability to refinance or pay in
full any Advance on its Maturity Date. In connection with the execution and
delivery of this Master Agreement and the other Loan Documents (and the delivery
to, or for the benefit of, Lender of any collateral contemplated thereunder),
and the incurrence by Borrower of the obligations under this Master Agreement
and the other Loan Documents, Borrower did not receive less than reasonably
equivalent value in exchange for the incurrence of the obligations of Borrower
under this Master Agreement and the

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other Loan Documents. Affiliated Property Operator has sufficient working
capital, including cash flow from the Mortgaged Property, or other resources,
not only to maintain the Mortgaged Property in accordance with the terms of the
Facility Operating Agreement, but also to pay the rents and other obligations
under the Facility Operating Agreement, as well as other obligations under this
Master Agreement and the other Loan Documents that Borrower elects to pass
through to Affiliated Property Operator pursuant to the terms of the Facility
Operating Agreement.
(g)    Economic Sanctions, Anti-Money Laundering, and Anti-Corruption.
(1)    No Borrower Entity nor any Affiliated Property Operator, nor to
Borrower’s knowledge, any Identified Party, nor any Person Controlled by
Borrower Entity or any Affiliated Property Operator that also has a direct or
indirect ownership interest in any Borrower Entity or Affiliated Property
Operator, is in violation of any applicable civil or criminal laws or
regulations, including those requiring internal controls, intended to prohibit,
prevent, or regulate money laundering, drug trafficking, terrorism, or
corruption, of the United States and the jurisdiction where the Mortgaged
Property is located or where the Person resides, is domiciled, or has its
principal place of business.
(2)    No Borrower Entity nor any Affiliated Property Operator, nor to
Borrower’s knowledge, any Identified Party, nor any Person Controlled by
Borrower Entity or any Affiliated Property Operator that also has a direct or
indirect ownership interest in any Borrower Entity or Affiliated Property
Operator, is a Person:
(A)    against whom proceedings are pending for any alleged violation of any
laws described in Section 4.01(g)(1) (Economic Sanctions, Anti-Money Laundering,
and Anti-Corruption);
(B)    that has been convicted of any violation of, has been subject to civil
penalties or Economic Sanctions pursuant to, or had any of its property seized
or forfeited under, any laws described in Section 4.01(g)(1) (Economic
Sanctions, Anti-Money Laundering, and Anti-Corruption); or
(C)    with whom any United States Person, any entity organized under the laws
of the United States or its constituent states or territories, or any entity,
regardless of where organized, having its principal place of business within the
United States or any of its territories, is a Sanctioned Person or is otherwise
prohibited from transacting business of the type contemplated by this Master
Agreement and the other Loan Documents under any other Applicable Law.
(3)    Each Borrower Entity and Affiliated Property Operator is in compliance
with all applicable Economic Sanctions laws and regulations.
(h)    Single Purpose Status.
Each Borrower and any general partner of a Borrower, at all times since its
formation:

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(1)    has not acquired, held, owned, leased, developed, or improved, and does
not own or lease any real property, personal property, or assets other than the
Mortgaged Property or equity interests in a Person that owns the Mortgaged
Property and such incidental personal property as may be necessary to conduct
the business and activities permitted under clause (2) below;
(2)    has not acquired or owned and does not own, operate, or participate in
any business other than the leasing, ownership, management, operation, financing
and maintenance of the Mortgaged Property or equity interests in a Person that
owns the Mortgaged Property and activities incidental thereto;
(3)    has no material financial obligation under or secured by any indenture,
mortgage, deed of trust, deed to secure debt, loan agreement, or other agreement
or instrument to which Borrower is a party, or by which Borrower is otherwise
bound, or to which the Mortgaged Property is subject or by which it is otherwise
encumbered, other than:
(A)    Permitted Equipment Financing and unsecured trade payables incurred in
the ordinary course of the operation of the Mortgaged Property (exclusive of
amounts for rehabilitation, restoration, repairs, or replacements of the
Mortgaged Property) that (i) are not evidenced by a promissory note, (ii) are
paid within sixty (60) days of the due date of such trade payable, and (iii) do
not exceed, for all Mortgaged Properties in the aggregate, two percent (2%) of
the Advances Outstanding;
(B)    if the Security Instrument grants a lien on a leasehold estate,
Borrower’s obligations as lessee under the ground lease creating such leasehold
estate;
(C)    Permitted Indebtedness; and
(D)    obligations under the Loan Documents and obligations secured by the
Mortgaged Property to the extent permitted by the Loan Documents;
(4)    has maintained its financial statements, accounting records, and other
partnership, real estate investment trust, limited liability company, or
corporate documents, as the case may be, separate from those of any other Person
and has not listed its assets on the financial statement of any other Person
(unless Borrower’s assets have been included in a consolidated financial
statement prepared in accordance with generally accepted accounting principles);
(5)    has not commingled its assets or funds with those of any other Person,
and has held all its assets or funds under its own name, in each case, unless
such assets or funds can easily be segregated and identified in the ordinary
course of business and in such a

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manner that it will not be costly or difficult to segregate, ascertain, or
identify its individual assets from those of any other Person;
(6)    has been adequately capitalized in light of its contemplated business
operations;
(7)    has not assumed, guaranteed, or become obligated for the liabilities or
obligations of any other Person or pledged its assets for the benefit of any
other Person (except in connection with (x) Permitted Indebtedness, (y) the
endorsement of negotiable instruments in the ordinary course of business and (z)
this Master Agreement or other mortgage loans that have been paid in full or
collaterally assigned to Lender, including in connection with any Consolidation,
Extension and Modification Agreement (for Mortgaged Properties in New York) or
similar instrument), or held out its credit as being available to satisfy the
obligations of any other Person;
(8)    has not made loans or advances to any other Person, except for
Intercompany Loans;
(9)    has not entered into and is not a party to any transaction with any
Borrower Affiliate, except (i) in the ordinary course of business and on terms
which are no more favorable to such Borrower Affiliate than would be obtained in
a comparable arm’s-length transaction with an unrelated third party or (ii) in
connection with Permitted Indebtedness. Notwithstanding the foregoing, Lender
hereby acknowledges that Borrower has entered into the Operating Leases and/or
Management Agreements for each Mortgaged Property other than Brookdale
Pinecastle, Brookdale Williamsburg and Brookdale Montrose with a Borrower
Affiliate;
(10)    has not acquired obligations or securities of any other Person;
provided, however, that the general partner of Borrower shall not fail to
qualify as a Single Purpose entity because of its Ownership Interests in
Borrower;
(11)    has paid (or has caused Property Operator, if any, on behalf of Borrower
from Borrower’s own funds to pay) its own liabilities, including the salaries of
its own employees, if any, from its own funds and maintained a sufficient number
of employees in light of its contemplated business operations;
(12)    has not failed to hold itself out to the public as a legal entity
separate and distinct from any other Person or to conduct its business solely in
its own name or any fictitious name registered with the applicable Governmental
Authority or failed to correct any known misunderstanding regarding its separate
identity;
(13)    has allocated fairly and reasonably any overhead for shared expenses;

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(14)    has maintained its existence as an entity duly organized, validly
existing, and in good standing (if applicable) under the laws of the
jurisdiction of its formation or organization and has done all things necessary
to observe organizational formalities;
(15)    has not, other than the general partner’s ownership interest in
Borrower, owned any subsidiary or made any investment in, any Person without the
prior written consent of Lender;
(16)    without the prior written consent of Lender or unless otherwise required
or permitted by a Cap Security Agreement, has not entered into or guaranteed,
provided security for, or otherwise undertaken any form of contingent obligation
with respect to any Hedging Arrangement; and
(17)    if such entity has only one member, has organizational documents which
provide that upon the occurrence of any event that causes its sole member to
cease to be a member while Advances are Outstanding, a special member (or one of
two special members where special members are individuals) will automatically be
admitted as the sole member of the entity and will preserve and continue the
existence of the entity without dissolution.
(i)    No Bankruptcies or Judgments.
None of Borrower, Property Operator, nor Borrower’s general partner or sole
member is currently:
(1)    the subject of or a party to any completed or pending bankruptcy,
reorganization, including any receivership, or other insolvency proceeding;
(2)    preparing or intending to be the subject of a Bankruptcy Event; or
(3)    the subject of any judgment unsatisfied of record or docketed in any
court; or
(4)    Insolvent.
(j)    No Actions or Litigation.
(1)    There are no claims, actions, suits, or proceedings at law or in equity
by or before any Governmental Authority now pending against or, to Borrower’s
knowledge, threatened in writing against or affecting Borrower, any Affiliated
Property Operator, or any Mortgaged Property for which no insurance is in place
(except claims, actions, suits, or proceedings regarding fair housing,
anti-discrimination, or equal opportunity, which shall always be disclosed); and
(2)    there are no claims, actions, suits, or proceedings at law or in equity
by or before any Governmental Authority now pending or, to Borrower’s knowledge,
threatened

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in writing against or affecting any Affiliated Property Operator, Guarantor, or
Key Principal, which claims, actions, suits, or proceedings, if adversely
determined (individually or in the aggregate) reasonably would be expected to:
(A) materially adversely affect the financial condition or business of Borrower,
any Affiliated Property Operator, Guarantor, or Key Principal or the condition,
operation, or ownership of the Mortgaged Property (except claims, actions,
suits, or proceedings regarding fair housing, anti-discrimination, or equal
opportunity, which shall always be deemed material), (B) result in the
appointment of a receiver, trustee or other official that would exercise control
over the Mortgaged Property and its management and operations, or (C) result in
the revocation, transfer, surrender, suspension, or other impairment of the
Licenses for any Mortgaged Property to operate as a Seniors Housing Facility.
(k)    Payment of Taxes, Assessments, and Other Charges.
Borrower confirms that:
(1)    each of Borrower and Affiliated Property Operator has filed all federal,
state, county, and municipal tax returns and reports required to have been filed
by it;
(2)    each of Borrower and Affiliated Property Operator has paid, before any
fine, penalty, interest, lien, or costs may be added thereto, all taxes,
governmental charges, and assessments due and payable with respect to such
returns and reports (or is contesting the same in accordance with the provisions
of this Master Agreement);
(3)    there is no controversy or objection pending, or to the knowledge of
Borrower, threatened in respect of any tax returns of Borrower or Affiliated
Property Operator (other than contests initiated after the date hereof in
accordance with the provisions of this Master Agreement); and
(4)    each of Borrower and Affiliated Property Operator has made adequate
reserves on its books and records for all taxes that have accrued but which are
not yet due and payable.
(l)    Not a Foreign Person.
Borrower is not a “foreign person” within the meaning of Section 1445(f)(3) of
the Internal Revenue Code.
(m)    ERISA.
Borrower represents and warrants that:
(1)    neither Borrower nor Affiliated Property Operator is an Employee Benefit
Plan;

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(2)    no asset of Borrower or Affiliated Property Operator constitutes “plan
assets” (within the meaning of Section 3(42) of ERISA and Department of Labor
Regulation Section 2510.3 101) of an Employee Benefit Plan;
(3)    no asset of Borrower or Affiliated Property Operator is subject to any
laws of any Governmental Authority governing the assets of an Employee Benefit
Plan; and
(4)    none of Borrower, Affiliated Property Operator, nor any ERISA Affiliate
is subject to any obligation or liability with respect to any ERISA Plan.
(n)    Default Under Other Obligations.
(1)    The execution, delivery, and performance of the obligations imposed on
Borrower under this Master Agreement and the Loan Documents to which it is a
party will not cause Borrower to be in default under the provisions of any
agreement, judgment or order to which Borrower is a party or by which Borrower
is bound, and the execution, delivery and performance of the obligations imposed
on Affiliated Property Operator or Borrower under the Facility Operating
Agreement will not cause Affiliated Property Operator or Borrower to be in
default under the provisions of any agreement, judgment, or order to which
Affiliated Property Operator or Borrower is a party or by which Affiliated
Property Operator or Borrower is bound.
(2)    There are no defaults by Borrower, any Affiliated Property Operator, if
any, or, to the knowledge of Borrower, by any other Person under any contract to
which Borrower or Affiliated Property Operator is a party, including any
management, rental, service, supply, security, maintenance or similar contract,
other than defaults which do not have, and are not reasonably expected to have,
a Material Adverse Effect.
(o)    Prohibited Person.
Neither Borrower Entity nor Affiliated Property Operator is a Prohibited Person,
nor to Borrower’s knowledge, is any Person:
(1)    Controlling any Borrower Entity or any Affiliated Property Operator a
Prohibited Person; or
(2)    Controlled by and having a direct or indirect ownership interest in any
Borrower Entity or any Affiliated Property Operator a Prohibited Person.
(p)    No Contravention; No Liens.
Neither the execution and delivery of the Facility Operating Agreement and this
Master Agreement and the other Loan Documents to which Borrower is a party, nor
the fulfillment of or compliance with the terms and conditions of the Facility
Operating Agreement and this Master Agreement and the other Loan Documents to
which Borrower, or Affiliated Property Operator

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under the Facility Operating Agreement, is a party, nor the performance of the
obligations of Borrower under this Master Agreement and the other Loan
Documents:
(1)    does or will conflict with or result in any breach or violation of (A)
any Applicable Law enacted or issued by any Governmental Authority or other
agency having jurisdiction over Borrower, the Mortgaged Properties or any other
portion of the Collateral or other assets of Borrower, or (B) any judgment or
order applicable to Borrower or to which Borrower, the Mortgaged Properties or
other assets of Borrower are subject;
(2)    does or will conflict with or result in any breach or violation of, or
constitute a default under, any of the terms, conditions or provisions of
Borrower’s Organizational Documents, any indenture, existing agreement or other
instrument to which Borrower is a party or to which Borrower, the Mortgaged
Properties or any other portion of the Collateral or other assets of Borrower
are subject;
(3)    does or will result in or require the creation of any Lien on all or any
portion of the Collateral or the Mortgaged Properties, except for the Permitted
Encumbrances; or
(4)    does or will require the consent or approval of any creditor of Borrower,
any Governmental Authority or any other Person except such consents or approvals
which have already been obtained.
(q)    Lockbox Arrangement.
Borrower is not party to any type of lockbox agreement or similar cash
management arrangement that has not been approved by Lender in writing, and no
direct or indirect owner of Borrower, Affiliated Property Operator, and direct
or indirect owner of Affiliated Property Operator is party to any type of
lockbox agreement or similar cash management arrangement with respect to Rents
or other income from the Mortgaged Property that has not been approved by Lender
in writing.
(r)    No Reliance.
Borrower acknowledges, represents, and warrants that it understands the nature
and structure of the transactions contemplated by this Master Agreement and the
other Loan Documents to which Borrower is a party (including the
cross-collateralization and cross-default of the Indebtedness), that it is
familiar with the provisions of all of the documents and instruments relating to
such transactions; that it understands the risks inherent in such transactions,
including the risk of loss of all or any of the Mortgaged Properties; and that
it has not relied on Lender or Fannie Mae for any guidance or expertise in
analyzing the financial or other consequences of the transactions contemplated
by this Master Agreement or any other Loan Document to which Borrower is a party
or otherwise relied on Lender or Fannie Mae in any manner in connection with
interpreting, entering into or otherwise in connection with this Master
Agreement, any other Loan Document or any of the matters contemplated hereby or
thereby.

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(s)    Investment Company Act.
Borrower is not (1) an “investment company” or a company “controlled” by an
“investment company,” within the meaning of the Investment Company Act of 1940,
as amended; (2) a “holding company” or a “subsidiary company” of a “holding
company” or an “affiliate” of either a “holding company” or a “subsidiary
company” within the meaning of the Energy Policy Act of 2005, as amended; or (3)
subject to any other federal or state law or regulation which purports to
restrict or regulate its ability to borrow money.
(t)    Licensing; Borrower/Property Operator Compliance with Laws.
(1)    Borrower (or the Property Operator, if applicable) is in all respects
legally authorized to operate the Mortgaged Property as a Seniors Housing
Facility under the Applicable Law of the Property Jurisdiction. If required by
Applicable Law, Borrower has, or the Property Operator, if applicable, has a
current provider agreement (other than the Medicaid Provider Agreement covered
by Section 6.01(g) (Medicaid Provider Agreement Representations)) under any and
all applicable federal, state, and local laws for reimbursement for providing
housing or services to residents at the Mortgaged Property. There is no decision
not to renew any provider agreement (including the Medicaid Provider Agreement
covered by Section 6.01(g) (Medicaid Provider Agreement Representations))
related to the Mortgaged Property, nor, to Borrower’s knowledge after due
inquiry is there any action pending or threatened to impose alternative,
interim, or final sanctions with respect to the Mortgaged Property.
(2)    Other than the Medicaid Provider Agreement covered by Section 6.01(g)
(Medicaid Provider Agreement Representations):
(A)    Except for the Medicare-eligible units at the Mortgaged Property known as
Brookdale Carriage Club Providence and the skilled nursing units at Mortgaged
Properties known as Brookdale Carriage Club Providence and Brookdale Westlake
Village, Borrower is not a participant in any federal program whereby any
Governmental Authority may have the right to recover funds by reason of the
advance of federal funds; and
(B)    Property Operator is not a participant in any federal program whereby any
Governmental Authority may have the right to recover funds by reason of the
advance of federal funds with respect to the Mortgaged Property.
(3)    Borrower has not received notice, and is not aware of any violation by
Borrower or Affiliated Property Operator of applicable antitrust laws of any
Governmental Authority.
(4)    The Licenses necessary for the operation of any Mortgaged Property as a
Seniors Housing Facility in the Property Jurisdiction will not be adversely
affected by (A) the execution and delivery of this Master Agreement, the Note,
the Security

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Instrument, the SASA, or the other Loan Documents, or the Facility Operating
Agreement, (B) Borrower’s performance under any of them, or (C) the recordation
of the Security Instrument or any other Loan Document.
(5)    In the event any existing Facility Operating Agreement is terminated or
Lender acquires the Mortgaged Property through a Foreclosure Event, none of
Borrower, Lender, any current or future Property Operator, or any subsequent
purchaser must obtain a certificate of need from any applicable state health
care regulatory authority or agency (other than giving such notice required
under the applicable state law or regulation) prior to applying for any
applicable License, provided that no service or unit complement is changed.
(6)    If Borrower or any Property Operator is a HIPAA Covered Entity, Borrower
hereby confirms that such entity has developed and implemented a HIPAA
compliance plan (including providing a Notice of Privacy Practices as required
under HIPAA), designated a privacy officer and otherwise achieved substantial
compliance with HIPAA requirements, including those concerning privacy, breach
notification, security and billing standards.
(7)    The Licenses identified on Schedule 24 with regard to (i) the Mortgaged
Property known as Brookdale Pinecastle are currently held by CMCP-Pinecastle,
LLC, (ii) the Mortgaged Property known as Brookdale Williamsburg are currently
held by CMCP-Williamsburg, LLC, and (iii) the Mortgaged Property known as
Brookdale Montrose are currently held by CMCP-Montrose, LLC. Borrower is unaware
of any other Licenses required to lawfully operate the Mortgaged Properties
known as Brookdale Pinecastle, Brookdale Williamsburg, and Brookdale Montrose as
Seniors Housing Facilities. Each of the Licenses listed on Schedule 24 have been
lawfully issued to each of CMCP-Pinecastle, LLC, CMCP-Williamsburg, LLC, and
CMCP-Montrose, LLC, as applicable, and are in full force and effect; and no
violations of record exist pertaining to any such License, except for minor
violations noted in routine inspections by Governmental Authorities that are
being remedied in the ordinary course and that Borrower reasonably believe will
be remedied as required by such Governmental Authorities. The operations of the
Mortgaged Properties known as Brookdale Pinecastle, Brookdale Williamsburg, and
Brookdale Montrose comply with the Licenses. There is no legal action pending or
to the best of Borrower’s knowledge threatened which would adversely affect the
Licenses or the operations at the Mortgaged Properties known as Brookdale
Pinecastle, Brookdale Williamsburg, and Brookdale Montrose. Neither
CMCP-Pinecastle, LLC, CMCP-Williamsburg, LLC, nor CMCP-Montrose, LLC is
currently operating under a consent order or decree, or any other agreement or
decree mandated by the courts or a governmental entity that restricts or
otherwise affects the operation of the Mortgaged Property owned by such
Borrower.
(8)    The operation of the Mortgaged Properties known as Brookdale Pinecastle,
Brookdale Williamsburg, and Brookdale Montrose complies with the Licenses set
forth on Schedule 24.

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(9)    Each of CMCP-Pinecastle, LLC, CMCP-Williamsburg, LLC, and CMCP-Montrose,
LLC operates its Mortgaged Property as the type of facility described on
Schedule 24 pursuant to its Certificate of Occupancy and to its Licenses. Such
Certificate of Occupancy and Licenses are current and there are no violations of
record, except for minor violations noted in routine inspections by Governmental
Authorities that are being remedied in the ordinary course and Borrower
reasonably believes will be remedied as required by such Governmental
Authorities. The operations at the Mortgaged Properties known as Brookdale
Pinecastle, Brookdale Williamsburg and Brookdale Montrose comply with the terms
and conditions of their respective Certificate of Occupancy. Such Certificate of
Occupancy has no termination date. The Licenses for such Mortgaged Properties
are valid and must be renewed for the period set forth on Schedule 24. If no
regulatory or licensing requirements currently apply to any of the Mortgaged
Properties known as Brookdale Pinecastle, Brookdale Williamsburg, and Brookdale
Montrose, as set forth on Schedule 24, each of CMCP-Pinecastle, LLC,
CMCP-Williamsburg, LLC, and CMCP-Montrose, LLC, as applicable, is in all
respects legally authorized to operate and/or manage its Mortgaged Property as a
Seniors Housing Facility under the applicable laws of the Property Jurisdiction
without a License or operating certificate.
(10)    Foreclosure of any of the Mortgaged Properties known as Brookdale
Pinecastle, Brookdale Williamsburg, and Brookdale Montrose by Lender or any
other transfer of such Mortgaged Property as a result of an Event of Default by
any of CMCP-Pinecastle, LLC, CMCP-Williamsburg, LLC, and CMCP-Montrose, LLC
under the applicable Security Instrument will not result in a revocation,
suspension or limitation of the Licenses, provided that the applicable
Governmental Authorities with jurisdiction over the Licenses approve the
transfer of the Licenses for such Mortgaged Property to a new manager, operator
or fee owner.
(11)    To Borrower’s knowledge, there currently exist no grounds for the
revocation, suspension or limitation of any Licenses for any of the Mortgaged
Properties known as Brookdale Pinecastle, Brookdale Williamsburg, and Brookdale
Montrose other than deficiencies cited in routine licensure surveys which
deficiencies are capable of being cured by Borrower in the ordinary course and
prior to the expiration of the time frame, if any, noticed for cure in such
survey or any plan of correction submitted in response to such survey, subject
to any additional cure periods allowed by any applicable Governmental Authority
with respect thereto.
Section 4.02    Covenants.
(a)    Maintenance of Existence; Organizational Documents.
(1)    Each of Borrower, sole member of Borrower, managing member of Borrower,
general partner of Borrower, Affiliated Property Operator, Guarantor and Key
Principal shall maintain its existence, its entity status, franchises, rights,
and privileges under the laws of the state of its formation or organization (as
applicable). Borrower and Affiliated Property Operator shall each continue to be
duly qualified and in good standing

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to transact business in each jurisdiction in which qualification or standing is
required according to Applicable Law to conduct its business with respect to its
Mortgaged Property and where the failure to do so would adversely affect
Borrower’s or Affiliated Property Operator’s applicable ownership or operation
of its Mortgaged Property or the validity, enforceability, or the ability of
Borrower to perform its obligations under this Master Agreement or any other
Loan Document, or Affiliated Property Operator to perform its obligations under
the Facility Operating Agreement. Neither Borrower nor any partner, member,
manager, officer, or director of Borrower, nor Affiliated Property Operator nor
any partner, member, manager, officer, or director of Affiliated Property
Operator, shall:
(A)    except in connection with a Transfer permitted under Section 11.02 or
Section 11.03, make or allow any material change to the organizational documents
or organizational structure of Borrower or Affiliated Property Operator,
including changes relating to the Control of Borrower or Affiliated Property
Operator, or
(B)    file any action, complaint, petition, or other claim to:
(i)    divide, partition, or otherwise compel the sale of any Mortgaged
Property; or
(ii)    otherwise change the Control of Borrower or Affiliated Property
Operator.
(b)    Economic Sanctions, Anti-Money Laundering, and Anti-Corruption.
(1)    Each Borrower Entity, any Affiliated Property Operator, any Identified
Party, or any Person Controlled by Borrower Entity or Affiliated Property
Operator that also has a direct or indirect ownership interest in any Borrower
Entity or Affiliated Property Operator shall remain in compliance with any
applicable civil or criminal laws or regulations (including those requiring
internal controls) intended to prohibit, prevent, or regulate money laundering,
drug trafficking, terrorism, or corruption, of the United States and the
jurisdiction where the Mortgaged Property is located or where the Person
resides, is domiciled, or has its principal place of business.
(2)    At no time shall any Borrower Entity, any Affiliated Property Operator,
or any Identified Party, or any Person Controlled by Borrower Entity or
Affiliated Property Operator that also has a direct or indirect ownership
interest in any Borrower Entity or Affiliated Property Operator, be a Person:
(A)    against whom proceedings are pending for any alleged violation of any
laws described in Section 4.02(b)(1) (Economic Sanctions, Anti-Money Laundering,
and Anti-Corruption);

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(B)    that has been convicted of any violation of, has been subject to civil
penalties or Economic Sanctions pursuant to, or had any of its property seized
or forfeited under, any laws described in Section 4.02(b)(1) (Economic
Sanctions, Anti-Money Laundering, and Anti-Corruption); or
(C)    with whom any United States Person, any entity organized under the laws
of the United States or its constituent states or territories, or any entity,
regardless of where organized, having its principal place of business within the
United States or any of its territories, is a Sanctioned Person or is otherwise
prohibited from transacting business of the type contemplated by this Master
Agreement and the other Loan Documents under any other Applicable Law.
(3)    Borrower, Guarantor, and Key Principal shall at all times remain in
compliance with any applicable Economic Sanctions laws and regulations.
(c)    Payment of Taxes, Assessments, and Other Charges.
Borrower and Affiliated Property Operator shall each file all federal, state,
county, and municipal tax returns and reports required to be filed by Borrower
and Affiliated Property Operator, respectively, and shall pay, before any fine,
penalty, interest, or cost may be added thereto, all taxes payable with respect
to such returns and reports; provided nothing herein shall require Borrower or
Affiliated Property Operator to pay any tax so long as each of Borrower and
Affiliated Property Operator in good faith and at its own expense and by proper
legal proceedings is diligently contesting the validity, amount or application
of any such tax and at the time of commencement of the proceeding and during the
pendency thereof (i) no Lien has been or is filed against the Mortgaged
Property, (ii) no Mortgaged Property will be in material danger of being sold,
forfeited or lost, as determined by Lender; (iii) Borrower and Affiliated
Property Operator shall furnish such security as may be required in such
proceeding or as may be reasonably requested by Lender to insure the payment of
the amounts contested (after taking into account any reserves held by Lender for
such purpose); and (iv) such contest operates to suspend collection or
enforcement of the contested amount, as applicable. .
(d)    Single Purpose Status.
Borrower and its general partner (as applicable):
(1)    shall not acquire, hold, develop, lease, or improve any real property,
personal property, or assets other than (A) the Mortgaged Property or (B) equity
interests in a Person that owns the Mortgaged Property;
(2)    shall not acquire, own, operate, or participate in any business other
than the leasing, ownership, management, operation, financing and maintenance of
the Mortgaged Property or equity interests in a Person that owns the Mortgaged
Property and activities incidental thereto;

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(3)    shall not commingle its assets or funds with those of any other Person,
unless such assets or funds can easily be segregated and identified in the
ordinary course of business from those of any other Person;
(4)    shall maintain its financial statements, accounting records, and other
partnership, real estate investment trust, limited liability company, or
corporate documents, as the case may be, separate from those of any other Person
(unless Borrower’s assets are included in a consolidated financial statement
prepared in accordance with generally accepted accounting principles);
(5)    shall have no material financial obligation under any indenture,
mortgage, deed of trust, deed to secure debt, loan agreement, or other agreement
or instrument to which Borrower is a party or by which Borrower is otherwise
bound, or to which the Mortgaged Property is subject or by which it is otherwise
encumbered, other than:
(A)    Permitted Equipment Financing or unsecured trade payables incurred in the
course of the operation of the Mortgaged Property (exclusive of amounts (i) to
be paid out of the Replacement Reserve Account or Repairs Escrow Account, or
(ii) for rehabilitation, restoration, repairs, or replacements of the Mortgaged
Property or otherwise approved by Lender) so long as such trade payables (1) are
not evidenced by a promissory note, (2) are payable within sixty (60) days of
the date incurred, and (3) as of any date, do not exceed for all Mortgaged
Properties in the aggregate two percent (2%) of the Advances Outstanding;
(B)    if the Security Instrument grants a lien on a leasehold estate,
Borrower’s obligations as lessee under the ground lease creating such leasehold
estate;
(C)    obligations under the Loan Documents and obligations secured by the
Mortgaged Property to the extent permitted by the Loan Documents; and
(D)    Permitted Indebtedness.
(6)    shall not, except in connection with (x) Permitted Indebtedness, and (y)
the endorsement of negotiable instruments in the ordinary course of business,
assume, guaranty, or become obligated for the liabilities or obligations of any
other Person, or pledge its assets for the benefit of any other Person (except
in connection with this Master Agreement or other mortgage loans that have been
paid in full or collaterally assigned to Lender, including in connection with
any Consolidation, Extension and Modification Agreement (for Mortgaged
Properties in New York) or similar instrument) or hold out its credit as being
available to satisfy the obligations of any other Person;
(7)    except for Intercompany Loans, shall not make loans or advances to any
other Person;

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(8)    shall not enter into or become a party to, any transaction with any
Borrower Affiliate, except in the ordinary course of business and on terms which
are no more favorable to such Borrower Affiliate than would be obtained in a
comparable arm’s length transaction with an unrelated third party or in
connection with Permitted Indebtedness. Notwithstanding the foregoing, Lender
hereby acknowledges that Borrower has entered into the Operating Leases and/or
Management Agreements for each Mortgaged Property other than Brookdale
Pinecastle, Brookdale Williamsburg and Brookdale Montrose with a Borrower
Affiliate;
(9)    shall not acquire obligations or securities of any other Person,
provided, however, that the general partner of Borrower shall not fail to
qualify as a Single Purpose entity because of its Ownership Interests in
Borrower;
(10)    shall pay (or shall cause Property Operator on behalf of Borrower from
Borrower’s own funds to pay) its own liabilities, including the salaries of its
own employees, if any, from its own funds and maintain a sufficient number of
employees in light of its contemplated business operations, provided, however,
in the event Gross Revenues are insufficient to pay all Operating Expenses,
including salaries of employees, if any, and all Debt Service Amounts, Guarantor
shall not be obligated to capitalize Borrower in order for Borrower to pay such
amounts;
(11)    shall not fail to hold itself out to the public as a legal entity
separate and distinct from any other Person or to conduct its business solely in
its own name or any name licensed or franchised to it, or fictitious name
registered with the applicable Governmental Authority or fail to correct any
known misunderstanding regarding its separate identity;
(12)    shall allocate fairly and reasonably any overhead for shared expenses;
(13)    shall maintain its existence as an entity duly organized, validly
existing, and in good standing (if applicable) under the laws of the
jurisdiction of its formation or organization and shall do all things necessary
to observe organizational formalities where the failure to be so qualified or in
good standing would adversely affect (x) Borrower’s ownership or operation of
the Mortgaged Property; or (y) the validity or enforceability of, or the ability
of Borrower to perform its obligations under, this Master Agreement or any other
Loan Document;
(14)    shall not, other than general partner’s ownership interest in Borrower,
own any subsidiary or make any investment in, any Person without the prior
written consent of Lender;
(15)    without the prior written consent of Lender or unless otherwise required
or permitted by a Cap Security Agreement, shall not enter into or guarantee,
provide security for, or otherwise undertake any form of contingent obligation
with respect to any Hedging Arrangement; and,

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(16)    if Borrower has only one member, Borrower shall maintain organizational
documents which provide that upon the occurrence of any event that causes its
sole member to cease to be a member while Advances are Outstanding, at least one
special member (or one of two special members where the special members are
individuals) will automatically be admitted as the sole member of the Borrower
and will preserve and continue the existence of the Borrower without
dissolution.
(e)    ERISA.
Borrower covenants that:
(1)    no asset of Borrower shall constitute “plan assets” (within the meaning
of Section 3(42) of ERISA and Department of Labor Regulation Section 2510.3 101)
of an Employee Benefit Plan;
(2)    no asset of Borrower shall be subject to the laws of any Governmental
Authority governing the assets of an Employee Benefit Plan; and
(3)    neither Borrower nor any ERISA Affiliate shall incur any obligation or
liability with respect to any ERISA Plan.
(f)    Notice of Litigation or Insolvency.
Borrower shall give immediate written notice to Lender of any claims, actions,
suits, or proceedings at law or in equity (including any insolvency, bankruptcy,
or receivership proceeding) by or before any Governmental Authority pending or,
to Borrower’s knowledge, threatened in writing against or affecting any Borrower
Entity, Property Operator, or Identified Party or the Mortgaged Property, which
claims, actions, suits or proceedings, if adversely determined reasonably would
be expected to materially adversely affect the Licenses required to lawfully
operate the Mortgaged Properties as Seniors Housing Facilities, the financial
condition or business of any Borrower Entity, Property Operator, or Identified
Party or the condition, operation, or ownership of the Mortgaged Property
(including any claims, actions, suits, or proceedings regarding fair housing,
anti-discrimination, or equal opportunity, which shall always be deemed
material). On the first day of each calendar month beginning on September, 2017,
Borrower shall provide to Lender a written report setting forth a description of
any and all claims, actions, suits or proceedings regarding fair housing,
anti-discrimination or equal opportunity that are not covered by insurance
(exclusive of deductibles) against any Borrower Entity, any Affiliated Property
Operator or any Identified Party, or otherwise relating to the Mortgaged
Property or any portion thereof. Provided Borrower complies with the preceding
sentence, each such written report shall be deemed timely notice for purposes of
this Section 4.02(f) solely as to claims, actions, suits or proceedings
regarding fair housing, anti-discrimination or equal opportunity,
notwithstanding that this Section 4.02(f) would otherwise require earlier notice
of claim, action, suit or proceeding disclosed in such report.

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(g)    Payment of Costs, Fees, and Expenses.
In addition to the payments specified in this Master Agreement, Borrower shall
pay, within ten (10) days after written demand, all of Lender’s and Fannie Mae’s
out-of-pocket fees, costs, charges, or expenses (including the reasonable fees
and expenses of attorneys, accountants, and other experts) incurred by Lender
and Fannie Mae in connection with:
(1)    any amendment to, consent, or waiver required under, or Request made
pursuant to, this Master Agreement, any of the Loan Documents, or the Facility
Operating Agreement (whether or not any such amendment, consent, waiver, or
Request is entered into);
(2)    defending or participating in any litigation arising from actions by
third parties and brought against or involving Lender with respect to:
(A)    any Mortgaged Property, including the Facility Operating Agreement;
(B)    any event, act, condition, or circumstance in connection with any
Mortgaged Property; or
(C)    the relationship between or among Lender, Fannie Mae, Borrower, Property
Operator, Key Principal, and Guarantor in connection with this Master Agreement
or any of the transactions contemplated by this Master Agreement or the Facility
Operating Agreement;
in each case, except for litigation arising out of claims by third parties based
on gross negligence or willful misconduct committed solely by Lender (and not
Borrower, Property Operator, Key Principal or Guarantor) as determined by a
court of competent jurisdiction pursuant to a final non-appealable court order.
(3)    the administration or enforcement of, or preservation of rights or
remedies under, this Master Agreement or any other Loan Documents including or
in connection with any litigation or appeals, any Foreclosure Event or other
disposition of any collateral granted pursuant to the Loan Documents or
collateral to which Lender acquires rights by virtue of the Facility Operating
Agreement; and
(4)    any Bankruptcy Event.
(h)    Restrictions on Distributions.
No distributions or dividends of any nature with respect to Rents or other
income from the Mortgaged Property shall be made to the owners of Borrower’s or
Affiliated Property Operator’s Ownership Interests as such if, at the time of
such distribution, (1) Borrower has knowledge that after such distribution it
will be unable to make monetary payments as and when such payments

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become due and payable, (2) an Event of Default has occurred and is continuing,
or (3) a Bankruptcy Event has occurred with respect to the Borrower, Key
Principal, or Guarantor.
(i)    Lockbox Arrangement.
Borrower shall not enter into any type of lockbox agreement or similar cash
management arrangement that has not been approved by Lender in writing, and no
direct or indirect owner of Borrower, Affiliated Property Operator, and direct
or indirect owner of Affiliated Property Operator shall enter into any type of
lockbox agreement or similar cash management arrangement with respect to Rents
or other income from the Mortgaged Property that has not been approved by Lender
in writing. Lender’s approval of any such cash management arrangement may be
conditioned upon requiring Borrower to enter into a lockbox agreement or similar
cash management arrangement with Lender in form and substance acceptable to
Lender with regard to Rents and other income from the Mortgaged Property.
(j)    Confidentiality of Certain Information.
Neither Borrower nor Affiliated Property Operator shall disclose and shall
prevent each other Borrower Entity and Identified Party from disclosing any
terms, conditions, underwriting requirements, or underwriting procedures of this
Master Agreement or any of the Loan Documents which are generally not available
to borrowers of Lender or Fannie Mae or members of the public through form
documents, descriptions of financing programs or underwriting processes or
otherwise; provided, however, that such information may be disclosed (1) as
required by law or pursuant to GAAP, (2) to officers, directors, employees,
agents, partners, attorneys, accountants, engineers, other consultants,
investors and, potential investors of such Borrower Entity, Affiliated Property
Operator, or Identified Party who need to know such information, provided such
Persons are instructed to treat such information confidentially, (3) to any
regulatory authority having jurisdiction over such Borrower Entity, Affiliated
Property Operator, or Identified Party, (4) in connection with any filings with
the Securities and Exchange Commission or other Governmental Authorities, or (5)
to any other Person to which such delivery or disclosure may be necessary or
appropriate (A) in compliance with any law, rule, regulation, or order
applicable to such Borrower Entity, Affiliated Property Operator, or Identified
Party, or (B) in response to any subpoena or other legal process or information
investigative demand.
(k)    Intentionally Omitted.
(l)    Borrower/Property Operator Compliance with Laws.
(1)    If required by Applicable Law, Borrower or Property Operator shall at all
times maintain a current provider agreement under any and all applicable
federal, state, and local laws providing for reimbursement (A) based on the
operation of a Mortgaged Property as a Seniors Housing Facility; or (B) for
providing housing or other services to residents at the Mortgaged Property.

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(2)    Other than the Medicaid Provider Agreement covered by Section 6.01(g)
(Medicaid Provider Agreement Representations) and except for the
Medicare-eligible units at the Mortgaged Property known as Brookdale Carriage
Club Providence and the skilled nursing units at Mortgaged Properties known as
Brookdale Carriage Club Providence and Brookdale Westlake Village:
(A)    Borrower shall not participate in any federal program whereby any
Governmental Authority may have the right to recover funds by reason of the
advance of federal funds; and
(B)    Property Operator shall not participate in any federal program whereby
any Governmental Authority may have the right to recover funds by reason of the
advance of federal funds with respect to the Mortgaged Property.
(3)    Borrower shall provide Lender notice of any violation by Borrower or
Affiliated Property Operator of applicable antitrust laws of any Governmental
Authority.
(4)    If Borrower or any Affiliated Property Operator is a HIPAA Covered
Entity, Borrower shall at all times remain in substantial compliance with HIPAA
requirements, including those concerning privacy, breach notification, security
and billing standards.
ARTICLE 5    
THE ADVANCES
Section 5.01    Representations and Warranties.
The representations and warranties made by Borrower to Lender in this Section
5.01 (The Advances – Representations and Warranties) are made as of each
Effective Date and are true and correct except as disclosed on the Exceptions to
Representations and Warranties Schedule.
(a)    Receipt and Review of Loan Documents.
Borrower has received and reviewed this Master Agreement and all of the other
Loan Documents.
(b)    No Default.
No Event of Default or Potential Event of Default exists under any of the Loan
Documents.
(c)    No Defenses.
The Loan Documents are not currently subject to any right of rescission,
set-off, counterclaim, or defense by either Borrower or Guarantor, including the
defense of usury, nor would the operation of any of the terms of the Loan
Documents, or the exercise of any right thereunder, render the Loan Documents
unenforceable (subject to principles of equity and bankruptcy, Insolvency Laws,
and other laws generally affecting creditors’ rights and the

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enforcement of debtors’ obligations), and neither Borrower nor Guarantor has
asserted any right of rescission, set-off, counterclaim, or defense with respect
thereto.
(d)    Loan Document Taxes.
All mortgage, mortgage and lease recording, stamp, intangible, or any other
similar taxes required to be paid by any Person under Applicable Law currently
in effect in connection with the execution, delivery, recordation, filing,
registration, perfection, or enforcement of the Facility Operating Agreement or
any of the Loan Documents, including the Security Instrument, have been paid or
will be paid in the ordinary course of the closing of any Advance.
Section 5.02    Covenants.
(a)    Ratification of Covenants; Estoppels; Certifications.
Borrower shall:
(1)    promptly notify Lender in writing upon any violation of any covenant set
forth in any Loan Document of which Borrower has notice or knowledge; provided,
however, any such written notice by Borrower to Lender shall not relieve
Borrower of, or result in a waiver of, any obligation under this Master
Agreement or any other Loan Document; and
(2)    within ten (10) days after a request from Lender, provide a written
statement, signed and acknowledged by Borrower, together with such corresponding
certifications from Property Operator as Lender may request, certifying to
Lender or any Person designated by Lender, as of the date of such statement:
(A)    that the Loan Documents are unmodified and in full force and effect (or,
if there have been modifications, that the Loan Documents are in full force and
effect as modified and setting forth such modifications);
(B)    the unpaid principal balance of the Advances Outstanding;
(C)    the date to which interest on the Advances Outstanding has been paid;
(D)    that Borrower is not in default in paying the Advances Outstanding or in
performing or observing any of the covenants or agreements contained in this
Master Agreement or any of the other Loan Documents (or, if Borrower is in
default, describing such default in reasonable detail);
(E)    whether or not there are then existing any setoffs or defenses known to
Borrower against the enforcement of any right or remedy of Lender under the Loan
Documents; and

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(F)    any additional facts reasonably requested in writing by Lender.
(b)    Further Assurances.
(1)    Other Documents As Lender May Require.
Within ten (10) days after request by Lender, Borrower shall, subject to Section
5.02(d) (Limitations on Further Acts of Borrower) below, execute, acknowledge,
deliver, and, if necessary, file or record, at its cost and expense, all further
acts, deeds, conveyances, assignments, financing statements, transfers,
documents, agreements, assurances, and such other instruments as Lender may
reasonably require from time to time in order to better assure, grant, and
convey to Lender the rights intended to be granted, now or in the future, to
Lender under this Master Agreement and the other Loan Documents and take such
further action as Lender from time to time may reasonably request as reasonably
necessary, desirable, or proper to carry out more effectively the purposes of
this Master Agreement or any of the other Loan Documents.
(2)    Corrective Actions.
Within ten (10) days after request by Lender, Borrower shall provide, or cause
to be provided, to Lender, at Borrower’s cost and expense, such further
documentation or information reasonably deemed necessary or appropriate by
Lender in the exercise of its rights under the related commitment letter, this
Master Agreement and/or the Rate Lock and Certification Agreement, as applicable
between Borrower and Lender or to correct patent mistakes in the Loan Documents,
the Title Policy, or the funding of the Advances.
(3)    Compliance with Investor Requirements.
Without limiting the generality of subsections (1) and (2) above, Borrower shall
subject to Section 5.02(d) (Limitations on Further Acts of Borrower) below, take
all reasonable actions necessary to comply with the requirements of Lender to
enable Lender to sell any MBS backed by an Advance or achieve or preserve the
expected federal income tax treatment of any MBS trust that directly or
indirectly holds an Advance and issues MBS as a fixed investment trust or real
estate mortgage investment conduit, as the case may be, within the meaning of
the Treasury Regulations.
(c)    Sale of Advances.
Borrower shall, subject to Section 5.02(d) (Limitations on Further Acts of
Borrower) below:
(1)    comply with the reasonable requirements of Lender or any Investor or
provide, or cause to be provided, to Lender or any Investor within ten (10) days
after the request, at Borrower’s cost and expense, such further documentation or
information as Lender or Investor may reasonably require in order to:

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(A)    enable Lender to sell the Advance to such Investor;
(B)    enable Lender to obtain a refund of any commitment fee from any such
Investor;
(C)    enable any such Investor to further sell or securitize the Advance; or
(D)    achieve or preserve the expected federal income tax treatment of any MBS
trust that directly or indirectly holds an Advance and issues MBS as a fixed
investment trust or real estate mortgage investment conduit, as the case may be,
within the meaning of the Treasury Regulations.
(2)    ratify and affirm in writing the representations and warranties set forth
in any Loan Document as of such date specified by Lender modified as necessary
to reflect changes that have occurred subsequent to the Effective Date;
(3)    confirm that Borrower is not in default in paying the Indebtedness or in
performing or observing any of the covenants or agreements contained in this
Master Agreement or any of the other Loan Documents (or, if Borrower is in
default, describing such default in reasonable detail); and
(4)    execute and deliver to Lender and/or any Investor such other
documentation, including any amendments, corrections, deletions, or additions to
this Master Agreement or other Loan Document(s) as is reasonably required by
Lender or such Investor.
(d)    Limitations on Further Acts of Borrower.
Nothing in Section 5.02(b) (Further Assurances) or Section 5.02(c) (Sale of
Advances) shall require Borrower to do any further act that has the effect of
(i) changing the economic terms set forth in the Loan Documents, (ii) imposing
on Borrower or Guarantor greater personal liability under the Loan Documents
than as set forth in the Loan Documents, (iii) materially changing the rights
and obligations of Borrower or Guarantor under the Loan Documents, or (iv)
imposing on Borrower or Guarantor an expense greater than $100,000 (per request
or series of related requests) in connection with the sale of any MBS backed by
an Advance; provided that the limitation in this Section 5.02(d)(iv) shall not
apply with respect to (1) Borrower's obligations under Section 5.02(b)(2), or
(2) any expense incurred as a result of any act or omission of Borrower or
Guarantor, including without limitation, any failure to disclose a material fact
to Lender.
(e)    Financing Statements; Record Searches.
(1)    Borrower shall pay all costs and expenses associated with:

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(A)    any filing or recording of any financing statements, including all
continuation statements, termination statements, and amendments or any other
filings related to security interests in or liens on collateral; and
(B)    any record searches for financing statements that Lender may require.
(2)    Borrower hereby authorizes Lender (and represents and warrants that the
Facility Operating Agreement authorizes Borrower) to file any financing
statements, continuation statements, termination statements, and amendments
(including an “all assets” or “all personal property” collateral description or
words of similar import) in form and substance as Lender may require in order to
protect and preserve Lender’s lien priority and security interest in any
Mortgaged Property (and to the extent Lender has filed any such financing
statements, continuation statements, or amendments prior to the applicable
Effective Date, such filings by Lender are hereby authorized and ratified by
Borrower and are permitted under the terms of the Facility Operating Agreement).
(f)    Loan Document Taxes.
Borrower shall pay, on demand, any transfer taxes, documentary taxes,
assessments, or charges made by any Governmental Authority in connection with
the execution, delivery, recordation, filing, registration, perfection, or
enforcement of any of the Loan Documents, the Facility Operating Agreement, or
the Advances. However, Borrower will not be obligated to pay any franchise,
excise, estate, inheritance, income, excess profits or similar tax on Lender.
(g)    Date-Down Endorsements.
In connection with a Collateral Event Lender may obtain, at Borrower’s cost, an
endorsement to the Title Policy for each Mortgaged Property, amending the
effective date of such Title Policy to the date of the Collateral Event showing
no items of record from the initial effective date of the Title Policy other
than Permitted Encumbrances. At any time and from time to time that Lender has
reason to believe that an additional lien may encumber any Mortgaged Property or
in order to protect Lender’s interest in the Collateral, Lender may obtain, at
Borrower’s cost, a search of title with respect to each Mortgaged Property and
if such title search uncovers any items of record that did not exist as of the
effective date of such Title Policy and such item is not a Permitted
Encumbrance, Lender may obtain, at Borrower’s cost, an endorsement to the Title
Policy for each Mortgaged Property, amending the effective date of such Title
Policy to the date of the title search performed in connection with the
endorsement showing no items of record from the initial effective date of the
Title Policy other than Permitted Encumbrances.

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Section 5.03    Administrative Matters Regarding Advances.
(a)    Determination of Allocable Facility Amount and Valuations.
(1)    Initial Determinations.
On the Initial Effective Date, Lender shall determine (A) the Allocable Facility
Amount and Valuation for each Initial Mortgaged Property, and (B) the Aggregate
Debt Service Coverage Ratio and the Aggregate Loan to Value Ratio. Changes in
Allocable Facility Amount, Valuations, the Aggregate Debt Service Coverage
Ratio, and the Aggregate Loan to Value Ratio shall be made pursuant to Section
5.03(a)(2) (Subsequent Monitoring Determinations).
(2)    Subsequent Monitoring Determinations.
(A)    Once each Calendar Quarter, within twenty (20) Business Days after
Borrower has delivered to Lender the reports required in Section 8.02 (Books and
Records; Financial Reporting – Covenants), Lender shall determine the Aggregate
Debt Service Coverage Ratio, the Aggregate Loan to Value Ratio, and whether
Borrower is in compliance with the covenants, the skilled nursing covenants, the
springing cap requirements, and any other requirements set forth in the Loan
Documents, provided that for the first three (3) years following the Initial
Effective Date Borrower shall not be obligated to reimburse Lender for the costs
of any new Appraisals if required by Lender in connection with such
determinations. After the First Anniversary if, in Lender’s reasonable judgment,
changed market or property conditions warrant, Lender shall redetermine
Allocable Facility Amounts and Valuations, provided that for the first three (3)
years following the Initial Effective Date, Borrower shall not be obligated to
reimburse Lender for the costs of any new Appraisals if required by Lender in
connection with such redeterminations. After the First Anniversary, Lender shall
also redetermine Allocable Facility Amounts and Valuations upon receipt of a
Request for a Collateral Event and immediately upon closing such Collateral
Event to take account of such Collateral Event, and upon any other event that
invalidates the outstanding determination. Lender shall have the right to
require new Appraisals for any Additional Mortgaged Property coming into the
Collateral Pool through an Addition or Substitution and Borrower shall be
obligated to pay the costs and expenses associated therewith. If Borrower
requests that Lender perform an Appraisal in connection with any Collateral
Event, then Borrower shall be obligated to pay the costs and expenses associated
therewith.
(B)    Lender shall promptly disclose its determinations to Borrower. Until
redetermined, the outstanding Allocable Facility Amounts and Valuations shall
remain in effect. Upon receipt by Borrower of any such new determinations by
Lender, Borrower shall promptly acknowledge such receipt.
Notwithstanding anything in this Master Agreement to the contrary, no change in
Allocable Facility Amounts, Valuations, the Aggregate Loan to Value Ratio, or
the Aggregate Debt Service

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Coverage Ratio shall (i) result in a Potential Event of Default or Event of
Default, (ii) require the prepayment of any Advance in whole or in part, or
(iii) require the addition of Collateral to the Collateral Pool.
ARTICLE 6    
PROPERTY USE, PRESERVATION, AND MAINTENANCE
Section 6.01    Representations and Warranties.
The representations and warranties made by Borrower to Lender in this Section
6.01 (Property Use, Preservation and Maintenance – Representations and
Warranties) are made as of each Effective Date and are true and correct except
as disclosed on the Exceptions to Representations and Warranties Schedule.
(a)    Mortgaged Property Compliance with Laws; Permits and Licenses.
(1)    To Borrower’s knowledge, all improvements to the Land and the use of the
Mortgaged Properties comply in all material respects with:
(A)    except as disclosed in any written environmental reports delivered to
Lender before the date of this Master Agreement and for minor violations noted
in the routine inspections by Governmental Authorities that are being remedied
in the ordinary course of business and that Borrower reasonably believes will be
remedied as required by such Governmental Authorities, all Applicable Law,
including all applicable statutes, rules, and regulations pertaining to
requirements for equal opportunity, anti-discrimination, fair housing, and rent
control;
(B)    the applicable provisions of all laws, rules, regulations, and published
interpretations thereof including all criteria established to classify the
Mortgaged Property as housing for older persons under the Fair Housing
Amendments Act of 1988 and the Housing for Older Persons Act of 1995 to which
Borrower, Property Operator, or the Mortgaged Property is subject; and
(C)    privacy, breach notification, security, and electronic transaction
standards including those set forth in HIPAA; and
Borrower has no knowledge of any action or proceeding (or threatened action or
proceeding) regarding noncompliance or nonconformity with any of the foregoing.
(2)    To Borrower’s knowledge, there is no evidence of any illegal activities
on the Mortgaged Properties.
(3)    To Borrower’s knowledge, no permits or approvals from any Governmental
Authority, other than those previously obtained and furnished to Lender, are
necessary for the commencement and completion of the Repairs or Replacements, as
applicable, other

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than those permits or approvals which will be timely obtained in the ordinary
course of business.
(4)    All required permits, licenses, and certificates to comply with all
Applicable Law, and for the lawful use and operation of the Mortgaged
Properties, including certificates of occupancy, apartment licenses, or the
equivalent, have been obtained and are in full force and effect.
(5)    No portion of any Mortgaged Property has been purchased with the proceeds
of any illegal activity.
(6)    To the extent required under Applicable Law for the Seniors Housing
Facility Licensing Designation, Borrower or Affiliated Property Operator is duly
licensed and such Licenses are in good standing and are in full force and
effect.
(b)    Operating Documents; Contracts; Resident Records.
(1)    Each Facility Operating Agreement, if any, and each Contract is a valid
and binding agreement enforceable against the parties in accordance with its
terms and is in full force and effect.
(2)    No party is in default in performing any of its obligations under any
Facility Operating Agreement and to the best knowledge of Borrower and
Affiliated Property Operator no party is in material default under any other
Contract.
(3)    Each Facility Operating Agreement, if any, and other Contracts (other
than Residential Leases) with annual aggregate payments greater than $50,000 are
assignable and no previous assignment of Borrower’s interest in the Facility
Operating Agreement or Contracts has been made. Borrower or Property Operator,
if any has entered into the Contracts with annual aggregate payments greater
than $50,000 previously identified to Lender for the provision of goods or
services, at or otherwise in connection with the operation, use, or management
of each Mortgaged Property.
(4)    All records pertaining to residents living at the Mortgaged Property are
true and correct in all material respects.
(c)    Property Characteristics.
No part of the Land is included or assessed under or as part of another tax lot
or parcel, and no part of any other property is included or assessed under or as
part of the tax lot or parcels for the Land.
(d)    Property Ownership.
The Mortgaged Property is owned by or leased to Borrower or Property Operator.

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(e)    Condition of the Mortgaged Property.
Borrower represents that:
(1)    Borrower has not made any claims, and to Borrower’s knowledge, no claims
have been made, against any contractor, engineer, architect, or other party with
respect to the construction or condition of any Mortgaged Property or the
existence of any structural or other material defect therein that have not been
fully corrected;
(2)    except with respect to a Release Mortgaged Property that is the subject
of a Release Request, no Mortgaged Property has sustained any damage other than
damage which has been fully repaired, or is fully insured (exclusive of
deductibles) and is being repaired in the ordinary course of business; and
(3)    except as disclosed in any third party report delivered to Lender prior
to the date on which any Mortgaged Property is added to the Collateral Pool, to
the knowledge of Borrower, the Mortgaged Properties are in good condition,
order, and repair (ordinary wear and tear excepted), and there exist no
structural or other material defects in any Mortgaged Property (whether patent,
latent, or otherwise), and Borrower has not received notice from any insurance
company or bonding company of any defects or inadequacies in any Mortgaged
Property, or any part of it, which would adversely affect the insurability of
such Mortgaged Property or cause the imposition of extraordinary premiums or
charges for insurance or of any termination or threatened termination of any
policy of insurance or bond.
(f)    Personal Property.
All Personal Property that is material to and is used in connection with the
management, ownership, and operation of the Mortgaged Property is:
(1)    owned by Borrower or Property Operator (or, to the extent disclosed on
the Exceptions to Representations and Warranties Schedule, leased by Borrower or
Property Operator, other than as lessor pursuant to the Seniors Housing Facility
Lease); or
(2)    as applicable, leased by Property Operator pursuant to the Seniors
Housing Facility Lease.
(g)    Medicaid Provider Agreement Representations.
(1)    If neither Borrower nor any Property Operator is a Medicaid Participant
as of the Effective Date, Borrower hereby confirms that neither Borrower nor
Property Operator has entered into a Medicaid Provider Agreement with respect to
the Mortgaged Property.

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(2)    The following provisions apply if a Medicaid Provider Agreement is in
place with respect to the Mortgaged Property:
(A)    Borrower has delivered to Lender a true and complete copy of the Medicaid
Provider Agreement in place as of the date the Mortgaged Property is added to
the Collateral Pool, together with any amendments and modifications thereto;
(B)    the Medicaid Provider Agreement is a valid and binding agreement
enforceable against the parties in accordance with its terms and is in full
force and effect;
(C)    to Borrower’s knowledge, neither Borrower, Property Operator nor a
Governmental Authority or Managed Care Organization is in default under the
Medicaid Provider Agreement nor does any state of facts exist that with the
passage of time or the giving of notice, or both, could constitute a default
under the Medicaid Provider Agreement;
(D)    neither Property Operator nor Borrower has received any notice from a
Governmental Authority or Managed Care Organization, as applicable, to the
effect that such Governmental Authority or Managed Care Organization, as
applicable, intends to terminate its relationship or unilaterally modify any
terms of the Medicaid Provider Agreement in effect as of the Effective Date,
including the reduction of rates paid to Borrower or Property Operator for
services provided under the Medicaid Provider Agreement;
(E)    as of the date the Mortgaged Property is added to the Collateral Pool,
Borrower or Property Operator, as applicable, meets the provider standards,
including all conditions for participation, as required by such Managed Care
Organization or Governmental Authority;
(F)    if Borrower or any Property Operator is a Medicaid Participant as of the
Effective Date with respect to the Mortgaged Property, Borrower hereby confirms
that no more than twenty percent (20%) of each Mortgaged Property’s effective
gross income is derived from funds paid to such Borrower or Property Operator by
a Governmental Authority or a Managed Care Organization, as applicable, under a
Medicaid Provider Agreement; and
(G)    neither Borrower nor any Property Operator has been excluded from
participation in any Governmental Health Care Program with respect to the
Mortgaged Property or any other property.

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(h)    Oil, Gas and Mineral Reservations.
(1)    As of the Initial Effective Date, Borrower represents and warrants that
there has been no lease, sublease, license, grant, reservation, or any other
form of transfer of any oil, gas, or mineral rights (each, a “Mineral Rights
Conveyance”) with respect to the Mortgaged Properties other than those
instruments specifically enumerated in the Title Insurance Policies delivered
with respect to the Mortgaged Properties listed on Schedule 21 (the “Mineral
Conveyance Properties”)
(2)    As of the Initial Effective Date, Borrower represents and warrants that
it has not received written notice from the owner or by or on behalf of the
owner, lessee, holder or beneficiary of any grant, reservation or lease of oil,
gas or mineral rights affecting any Mortgaged Property that it intends to
exercise its rights and is not aware of any proposed exercise of such rights by
or on behalf of such owner, lessee, holder or beneficiary affecting any
Mortgaged Property, except for the exercise of such rights at the Mortgaged
Property known as Brookdale Lewisville. Borrower covenants that it shall
immediately notify Lender in writing if it is so contacted or if it becomes
aware of any proposed exercise of such rights at any other Mortgaged Property.
(3)    Borrower shall promptly notify Lender in writing of any damage to any
Mortgaged Property or any improvements located thereon as a result of or in any
way relating to (i) the exercise of any right under a Mineral Rights Conveyance
that occurs on or before the Initial Effective Date, or (ii) any subsidence
arising from the exercise of any rights under a Mineral Rights Conveyance, then
Borrower shall, within thirty (30) Business Days of such damage, elect to either
(a) pay any amounts required to repair or restore such Mortgaged Property or any
improvements located thereon, in a good and workmanlike manner, to the
equivalent of its original condition or condition immediately prior to the
damage, or (b) release such Mortgaged Property from the Collateral Pool in
accordance with the Mortgaged Property Release Schedule (including, without
limitation, payment of the Release Price).
(i)    Surveys.
(1)    The most recent Survey of each Mortgaged Property identified on Schedule
23 to this Master Agreement properly depicts the present boundaries of such
Mortgaged Property and the location and configuration of all structures and
improvements located thereon, except as otherwise described on Schedule 23 to
this Master Agreement.
(2)    There have been no additions, modifications or alterations to the
improvements on any of the Mortgaged Properties which resulted in any changes in
the distances between the walls of the improvements and the lot lines shown on
the most recent

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Survey of each Mortgaged Property identified on Schedule 23 to this Master
Agreement, except as otherwise described on Schedule 23 to this Master
Agreement.
(3)    There are no encroachments onto or off of any Mortgaged Property (or onto
any easement affecting any Mortgaged Property), except as shown on the most
recent Survey of such Mortgaged Property identified on Schedule 23 to this
Master Agreement.
(4)    There have been no changes to the lot lines of any Mortgaged Property,
nor any fences erected or free standing improvements placed along said lot
lines, except as shown on the most recent Survey of such Mortgaged Property
identified on Schedule 23 to this Master Agreement.
(5)    No easements, rights of way or other matters have been granted and no
encroachments onto any Mortgaged Property exist, except as shown on the most
recent Survey of such Mortgaged Property identified on Schedule 23 to this
Master Agreement, as described in Schedule 23 to this Master Agreement or
otherwise disclosed in the Title Policy for such Mortgaged Property.
(j)    New York License Transfers.
Borrower represents and warrants that it has filed with the appropriate
Governmental Authorities with respect to the Brookdale Ithaca MC Mortgaged
Property, the Brookdale Niagara MC Mortgaged Property, and the Brookdale Clinton
MC Mortgaged Property, all applications and information that are required in
connection with Transfer or reissuance of the Licenses for each such Mortgaged
Property in the name of CB Ithaca Operator, Inc., CB Niagara Operator, Inc. and
CB Clinton Operator, Inc. (each, a “New Operator;” and collectively, the “New
Operators”), respectively, and in order to obtain any other approvals required
by Applicable Law in connection with such Transfers or reissuances. Borrower
further represents and warrants that Ithaca Sterling Cottage Operator, Inc.,
Niagara Sterling Cottage Operator, Inc. and Clinton Sterling Cottage Operator,
Inc. are each legally authorized to operate the applicable such Mortgaged
Property as a Seniors Housing Facility between the Effective Date and the
Transfer or date of issuance of new Licenses to each of the New Operators.
(k)    Condominium Provisions.
(1)    The Brookdale W. Eisenhower Pkwy Mortgaged Property located in Ann Arbor,
Michigan is a Condominium unit established under the Condominium Act.
(2)    No portion of the common elements of the Condominium have been sold,
conveyed or encumbered or are subject to any agreement to convey or encumber.
(l)    Intentionally Deleted.
(m)    Brookdale Scotts Valley Regulatory Agreement.
    

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Borrower hereby represents and warrants that: (1) Borrower is in full compliance
with that certain Agreement dated June 3, 1987 by and between City of Scotts
Valley and Borrower affecting the Mortgaged Property known as Brookdale Scotts
Valley and (2) while the City of Scotts Valley does not provide Borrower with
verbal or written verification of compliance with the Agreement on an annual
basis, it does provide indications of non-compliance and has not done so for the
most recent annual period. If at any time the City of Scotts Valley does provide
written verification of compliance, Borrower covenants that it shall promptly
provide such verification to Lender. Borrower further covenants that it shall
promptly notify Lender in writing of: (1) any notice of non-compliance, whether
written or verbal, (2) the cause of Borrower’s non-compliance, (3) Borrower’s
plan for remedying its non-compliance and (4) Borrower’s proposed time period
for achieving compliance.

(n)    No Other Regulatory Agreements.
Borrower hereby represents and warrants that, except for the Agreement
identified in Sections 6.01(l) and (m) of this Master Agreement, no Mortgaged
Property is subject to any regulatory agreement or other similar agreement which
imposes rental restrictions on the Mortgaged Property.
(o)    Brookdale Lewisville and Brookdale Montrose Exercise of Oil, Gas or
Mineral Rights.
Borrower hereby represents and warrants that (i) the exercise of oil, gas or
mineral rights at the Mortgaged Property known as Brookdale Lewisville is
horizontal drilling and not drilling on the surface of such Mortgaged Property,
and (ii) the exercise of oil, gas or mineral rights at each of the Mortgaged
Properties known as Brookdale Lewisville and Brookdale Montrose is not
disruptive in any manner to the use, operations or maintenance of such Mortgaged
Property.
(p)    Estoppel Certificates; SNDAs.
(1)    Reference is hereby made to the (i) Declaration of Covenants, Conditions
and Restrictions recorded among the land records of Orange County, California in
Book 14092 at page 1797 affecting the Mortgaged Property known as Brookdale
Irvine, and (ii) restrictions recorded among the map records of Harris County,
Texas in Volume 336 at page 145 affecting the Mortgaged Property known as
Brookdale Cypress Station (collectively, the “Subject Instruments”). Borrower
hereby represents and warrants that (1) to Borrower’s knowledge, no default has
occurred under any of the Subject Instruments and no event has occurred which,
with the passage of time or the giving of notice, or both, would constitute a
default under any of the Subject Instruments and (2) Borrower has not received
any notice of assessments or other notice requiring payment under any of the
Subject Instruments.
(2)    Reference is hereby made to that certain Building and Rooftop Lease
Agreement dated as of February 22, 2002 by and between ARC Northwest Hills,
L.P., a Tennessee limited partnership, and Dallas MTA, L.P., d/b/a Verizon
Wireless (the

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“Verizon Lease”), affecting the Mortgaged Property known as Brookdale Northwest
Hills. Borrower hereby represents and warrants that, to Borrower’s knowledge (1)
the Verizon Lease is valid and in full force and effect on the date hereof and
(2) no default has occurred under the Verizon Lease and no event has occurred
which, with the passage of time or the giving of notice, or both, would
constitute a default under the Verizon Lease.
(3)    Reference is hereby made to the Ground Lease. From and after the Initial
Effective Date, Borrower shall use diligent, commercially reasonable efforts to
cause Ground Lessor to execute the Ground Lessor Estoppel; provided, however,
that such efforts shall not require Borrower to pay to Ground Lessor (or any
partner comprising Ground Lessor) any sums that are not required to be paid
pursuant to the Ground Lease. No later than ten (10) Business Days following the
execution of the Ground Lessor Estoppel, Borrower shall deliver to Lender a copy
of the same, along with any additional information reasonably requested by
Lender.
(4)    If Borrower reasonably believes that Ground Lessor will not agree to
execute the Ground Lessor Estoppel, then Borrower shall promptly notify Lender
in writing. Lender may then elect, in its sole discretion, to either (i) waive
the requirements of clause (5) above, or (ii) require the Borrower to request
additional information or take additional, reasonable steps described by Lender.
Borrower shall promptly provide Lender with evidence reasonably acceptable to
Lender that it has requested such information or is diligently pursuing such
additional steps, as applicable until such time as Lender elects to waive the
requirements of clause (5) above or until the Ground Lessor Estoppel is executed
and delivered.
(q)    Brookdale W. Eisenhower Parkway
As of the Initial Effective Date, the Mortgaged Property known as Brookdale W.
Eisenhower Parkway is operated as a Seniors Housing Facility pursuant to a
healthcare License which expired in October, 2016. Borrower hereby represents
that a renewal application has been submitted to the applicable Licensing
Authority. Borrower further represents that it has received written confirmation
from the applicable Licensing Authority that the existing healthcare License
will remain in effect until the Licensing Authority issues a renewal healthcare
License.
(r)    Brookdale Lakeway AL/MC and Brookdale Northwest Hills
As of the Initial Effective Date, the Mortgaged Properties known as Brookdale
Lakeway AL/MC and Brookdale Northwest Hills are each operated as a Seniors
Housing Facility pursuant to a healthcare License which expired in July, 2017.
Borrower hereby represents that renewal applications have been submitted for
such Mortgaged Properties to the applicable Licensing Authority. Borrower
further represents that the existing healthcare Licenses will remain in effect
until the Licensing Authority issues a renewal healthcare License for each of
the Mortgaged Properties known as Brookdale Lakeway and Brookdale Northwest
Hills.

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Section 6.02    Covenants
(a)    Use of Property.
From and after the Effective Date, Borrower shall not, except as permitted below
or under Section 6.02(f), or unless required by Applicable Law or Governmental
Authority:
(1)    change the use of all or any part of its Mortgaged Property, including
any change in the unit or bed Acuity composition (provided that Borrower may
effect an Allowed Change in Use so long as:
(A)    Borrower provides Lender written notice within thirty (30) days of such
Allowed Change in Use; and
(B)    all other terms, conditions, and covenants of this Master Agreement are
satisfied including covenants related to zoning, certificates of occupancy,
Licenses and alterations to the Mortgaged Property).
Notwithstanding the foregoing, Borrower may modify the use of an existing
commercial space for a different commercial use without Lender consent so long
as such use is consistent with uses typically provided for at a Seniors Housing
Facility and all terms and provisions relating to commercial leases in this
Master Agreement except for the requirement of Lender consent are satisfied.
(2)    convert any individual dwelling units or common areas to commercial use,
or convert any common area or commercial use to individual dwelling units;
(3)    initiate or acquiesce in a change in the zoning classification of the
Land;
(4)    establish any condominium or cooperative regime with respect to its
Mortgaged Property;
(5)    subdivide the Land;
(6)    suffer, permit, or initiate the joint assessment of any Mortgaged
Property with any other real property constituting a tax lot separate from such
Mortgaged Property which could cause the part of the Land to be included or
assessed under or as part of another tax lot or parcel, or any part of any other
property to be included or assessed under or as part of the tax lot or parcels
for the Land;
(7)    allow use or occupancy of the Mortgaged Property by residential tenants
that do not meet the standards for a Seniors Housing Facility; or
(8)    accept tenants that require skilled nursing care or permit tenants
requiring skilled nursing care to remain at the Mortgaged Property as a routine
matter, other than in compliance with Schedule 19 (Skilled Nursing); provided
that if a resident privately

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contracts with a third party for home care services, Borrower shall not be
obligated to take steps to reject or remove such resident from the Mortgaged
Property.
Notwithstanding the foregoing, during the Term of this Master Agreement (i)
Borrower may convert no more than one (1) unit at a Mortgaged Property with
sixty-five (65) units or less and no more than two (2) units at a Mortgaged
Property with sixty-six (66) or more units for use in providing ancillary and
complementary senior housing services to residents, including health and therapy
services; provided, in each case, any such converted unit shall be leased for
rent that is not less than the greater of (a) seventy percent (70%) of the
residential rent payable for such unit immediately prior to such conversion or
(b) fair market rent, provided that in no event shall the rent be greater than
what is permitted by Applicable Law.
(b)    Property Maintenance.
Borrower shall:
(1)    pay the expenses of operating, managing, maintaining, and repairing its
Mortgaged Property (including insurance premiums, utilities, Repairs, and
Replacements) before the last date upon which each such payment may be made
without any penalty or interest charge being added;
(2)    keep its Mortgaged Property in good repair and marketable condition
(ordinary wear and tear excepted) (including the replacement of Personalty and
Fixtures with items of equal or better function and quality) and subject to
Section 9.03(b)(3) (Application of Proceeds on Event of Loss) and Section
10.03(d) (Preservation of Mortgaged Property) restore or repair promptly, in a
good and workmanlike manner, any damaged part of such Mortgaged Property to the
equivalent of its original condition or condition immediately prior to the
damage (if improved after the Effective Date), whether or not any insurance
proceeds or amounts received in connection with a Condemnation Action are
available to cover any costs of such restoration or repair;
(3)    commence all Required Repairs, Additional Lender Repairs, and Additional
Lender Replacements as follows:
(A)    with respect to any Required Repairs, promptly following the Effective
Date (subject to Force Majeure, if applicable), in accordance with the timelines
set forth on the Required Repair Schedule, or if no timelines are provided, as
soon as practical following the Effective Date;
(B)    with respect to Additional Lender Repairs, in the event that Lender
determines that Additional Lender Repairs are necessary from time to time or
pursuant to Section 6.03 (Administration Matters Regarding the Property),
promptly following Lender’s written notice of such Additional Lender Repairs
(subject to Force Majeure, if applicable), commence any such Additional Lender

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Repairs in accordance with Lender’s timelines, or if no timelines are provided,
as soon as practical;
(C)    with respect to Additional Lender Replacements, in the event that Lender
determines that Additional Lender Replacements are necessary from time to time
or pursuant to Section 6.03 (Administration Matters Regarding the Property),
promptly following Lender’s written notice of such Additional Lender
Replacements (subject to Force Majeure, if applicable), commence any such
Additional Lender Replacements in accordance with Lender’s timelines, or if no
timelines are provided, as soon as practical;
(4)    make, construct, install, diligently perform, and complete all
Replacements and Repairs:
(A)    in a good and workmanlike manner as soon as practicable following the
commencement thereof, free and clear of any Liens, including mechanics’ or
materialmen’s liens and encumbrances (except Permitted Encumbrances and
mechanics’ or materialmen’s liens which attach automatically under the laws of
any Governmental Authority upon the commencement of any work upon, or delivery
of any materials to, the Mortgaged Property and for which Borrower is not
delinquent in the payment for any such work or materials); provided, nothing
herein shall require Borrower to pay for any work or materials so long as
Borrower in good faith and at its own expense and by proper legal proceedings is
diligently contesting the validity, amount or application of such work or
materials and at the time of commencement of the proceeding and during the
pendency thereof (i) no Mortgaged Property will be in material danger of being
sold, forfeited or lost, as determined by Lender, (ii) Borrower shall furnish
such security as may be required in such proceeding or as may be reasonably
requested by Lender to insure the payment of the amounts contested and (iii)
such contest operates to suspend collection or enforcement of the contested
amount, as applicable;
(B)    in accordance with all Applicable Law;
(C)    in accordance with all applicable insurance and bonding requirements; and
(D)    within all timeframes required by Lender, and Borrower acknowledges that
it shall be an Event of Default if Borrower abandons or ceases work on any
Repair at any time prior to the completion of the Repairs for a period of longer
than twenty (20) days (except when Force Majeure exists and Borrower is
diligently pursuing the reinstitution of such work, provided, however, any such
abandonment or cessation shall not in any event allow the Repair to be completed
after the Completion Period, subject to Force Majeure);

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(5)    subject to the terms of Section 6.03(a) (Property Management), provide
for professional operation and management of the Mortgaged Property as a Seniors
Housing Facility either by Borrower or any Property Operator approved by Lender
in writing;
(6)    give written notice to Lender of, and, unless otherwise directed in
writing by Lender, appear in and defend any action or proceeding purporting to
affect any Mortgaged Property, Lender’s security for the Advances, or Lender’s
rights under this Master Agreement; and
(7)    upon Lender’s written request, submit to Lender any contracts or work
orders described in Section 13.02 (Administration Matters Regarding Reserves).
(c)    Property Preservation.
Borrower shall:
(1)    not commit waste or abandon or (ordinary wear and tear excepted) permit
impairment or deterioration of any Mortgaged Property;
(2)    subject to any Allowed Change in Use pursuant to Section 6.02(a) (Use of
Property) and except as otherwise permitted herein in connection with Repairs
and Replacements or in Section 6.02(f), not remove, demolish, or alter any
Mortgaged Property or any part of any Mortgaged Property (or permit any tenant
or any other Person to do the same) except in connection with the replacement of
tangible Personalty or Fixtures (provided such Personalty and Fixtures are
replaced with items of equal or better function and quality); provided nothing
herein shall require Borrower to pay for any alterations and additions so long
as Borrower in good faith and at its own expense and by proper legal proceedings
is diligently contesting the validity, amount or application of such alterations
and additions and at the time of commencement of the proceeding and during the
pendency thereof (w) no Lien has been or is filed against the Mortgaged
Property; (x) no Mortgaged Property will be in material danger of being sold,
forfeited or lost as determined by Lender; (y) Borrower shall furnish such
security as may be required in such proceeding or as may be reasonably requested
by Lender to insure the payment of the amounts contested and (z) such contest
operates to suspend collection or enforcement of the contested amount, as
applicable;
(3)    not engage in or knowingly permit, and shall take appropriate measures to
prevent and abate or cease and desist, any illegal activities at any Mortgaged
Property that could endanger tenants or visitors, result in damage to such
Mortgaged Property, result in forfeiture of the Land or otherwise materially
impair the lien created by the Security Instrument or Lender’s interest in such
Mortgaged Property;
(4)    not permit any condition to exist on any Mortgaged Property that would
invalidate any part of any insurance coverage required by this Master Agreement;
or

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(5)    not subject any Mortgaged Property to any voluntary, elective, or
non-compulsory tax lien or assessment (or opt in to any voluntary, elective, or
non-compulsory special tax district or similar regime).
(d)    Property Inspections.
Borrower shall:
(1)    permit Lender, its agents, representatives, and designees to enter upon
and inspect the Mortgaged Properties (including in connection with any
Replacement or Repair or to conduct any Environmental Inspection pursuant to the
Environmental Indemnity Agreement), and shall cooperate and provide access to
all areas of the Mortgaged Properties (subject to the rights of tenants under
the Leases, other than the Property Operator under the Seniors Housing Facility
Lease):
(A)    during normal business hours;
(B)    at such other reasonable time upon reasonable notice of not less than one
(1) Business Day;
(C)    at any time when exigent circumstances exist; or
(D)    at any time after an Event of Default has occurred and is continuing; and
(2)    pay for reasonable costs or expenses incurred by Lender or its agents in
connection with non-routine inspections (e.g., inspections for Repairs and/or
Replacements) or in connection with any such inspections during an Event of
Default.
(e)    Mortgaged Property Compliance with Laws.
Borrower shall:
(1)    comply in all material respects with Applicable Law and all recorded
lawful covenants and agreements relating to or affecting any Mortgaged Property,
including all laws, ordinances, statutes, rules and regulations, and covenants
pertaining to construction of improvements on the Land, fair housing, and
requirements for equal opportunity, anti-discrimination, and Leases;
(2)    procure and maintain all required permits, licenses, charters,
registrations, and certificates necessary to comply with all zoning and land use
statutes, laws, ordinances, rules and regulations, and all applicable health,
fire, safety, and building codes and for the lawful use and operation of each
Mortgaged Property, including certificates of occupancy, apartment licenses, or
the equivalent;

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(3)    comply with all Applicable Law that pertain to the maintenance and
disposition of tenant security deposits;
(4)    at all times maintain records sufficient to demonstrate compliance with
the provisions of this Section 6.02(e) (Compliance with Laws);
(5)    promptly after Borrower’s or Property Operator’s receipt or notification
thereof, provide Lender copies of any building code or zoning violation from any
Governmental Authority with respect to any Mortgaged Property; and
(6)    cooperate fully with Lender with respect to any proceedings before any
court, board, or other Governmental Authority which may in any way affect the
rights of Lender hereunder or any rights obtained by Lender under any of the
other Loan Documents and, in connection therewith, permit Lender, at its
election, to participate in any such proceedings.
(f)    Alterations to any Mortgaged Property.
No alteration, improvement, demolition, removal, or construction (collectively,
“Alterations”) shall be made to any Mortgaged Property without the prior written
consent of Lender if:
(1)    such Alteration could reasonably be expected to adversely affect the
value of such Mortgaged Property or its operation as a Multifamily Residential
Property in substantially the same manner in which it is being operated on the
date such property became Collateral;
(2)    the construction of such Alteration could reasonably be expected to
result in interference to the occupancy of tenants of such Mortgaged Property
such that tenants in occupancy with respect to five percent (5%) or more of the
tenants under the Leases would be displaced or permitted to terminate their
Leases or to abate the payment of all or any portion of their rent; or
(3)    such Alteration will be completed in more than twelve (12) months from
the date of commencement or in the last year of the Term of this Master
Agreement.
In addition, Borrower must obtain Lender’s prior written consent to construct
Alterations with respect to any Mortgaged Property costing in excess of, with
respect to any Mortgaged Property, the number of units in such Mortgaged
Property multiplied by $5,000, but in any event, costs in excess of $250,000,
Borrower must give prior written notice to Lender of its intent to construct
Alterations at any time with respect to any Mortgaged Property costing in excess
of $100,000; provided, however, that the preceding requirements shall not be
applicable to Alterations made, conducted, or undertaken by Borrower as part of
Borrower’s routine maintenance and repair of the Mortgaged Properties as
required by the Loan Documents (including any Repair or Replacement).
Notwithstanding the foregoing, Borrower has the right to expand the Mortgaged
Properties on the

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terms set forth on Schedule 20 attached hereto.
(g)    Licensing.
(1)    Borrower (A) shall maintain and operate, or shall cause Property
Operator, if applicable, to maintain and operate, the Mortgaged Property as a
Seniors Housing Facility, (B) shall maintain, or shall cause Property Operator,
if applicable, to maintain, in good standing all Licenses, (C) shall renew or
extend, or shall cause Property Operator, if applicable, to renew and extend,
all such required Licenses, and (D) shall not fail, nor allow the failure by
Property Operator, if applicable, to take any action necessary to keep all such
Licenses in good standing and full force and effect. Borrower will, or shall
cause Property Operator, if applicable, to provide Lender written notice within
ten (10) days of Borrower’s or Property Operator’s receipt of any notice or
order of a violation which may otherwise have an adverse impact on Borrower,
Property Operator with respect to its operations at the Mortgaged Property, or
the Mortgaged Property, its operations, or its compliance with licensing and
regulatory requirements, except for minor violations noted in the routine
inspections by Governmental Authorities that are being remedied in the ordinary
course of business and that Borrower reasonably believes will be remedied as
required by such Governmental Authorities.
(2)    If any License requirement is imposed upon the Mortgaged Property after
the date the Mortgaged Property is added to the Collateral Pool, Borrower shall
obtain, or shall cause the Property Operator, if applicable, to obtain, all
Licenses required to lawfully operate the Mortgaged Property as a Seniors
Housing Facility and shall maintain, or shall cause the Property Operator, if
applicable, to maintain, such Licenses in full force and effect. Borrower
acknowledges and agrees that all such Licenses are subject to the terms of this
Master Agreement and the Loan Documents.
(3)    Without the prior written consent of Lender, Borrower shall not, and
shall require Property Operator, if applicable, not to amend, modify, transfer,
or otherwise change the Licenses.
(4)    Borrower shall promptly inform Lender in writing and shall cause Property
Operator to promptly inform Lender in writing, if such party has actual
knowledge of, and shall deliver to Lender copies of, (A) any written
communications, complaints, orders, judgments, and other documents relating to
the commencement of any litigation, rulemaking, or disciplinary proceeding or
the promulgation of any proposed or final rule which would have, or may
reasonably be expected to have, a Material Adverse Effect on the Mortgaged
Property, on Borrower’s or any Property Operator’s ability to operate and manage
any Mortgaged Property as a Seniors Housing Facility, or the Licenses necessary
for the operation of a Seniors Housing Facility and/or any underlying License
that may be necessary in order to obtain a License necessary for the operation
of a Seniors Housing Facility, and (B) notice from any Governmental Authority
having jurisdiction over Borrower or any Property Operator that (i) Borrower or
Property Operator is being placed under regulatory supervision, (ii) any License
related to the conduct of Borrower’s or

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Property Operator’s, if applicable, business or the Mortgaged Property is to be
suspended or revoked, or (iii) Borrower or Property Operator is to cease and
desist any practice, procedure, or policy employed by Borrower or Property
Operator in the conduct of its business, and such cessation would have, or may
reasonably be expected to have, a Material Adverse Effect on the Mortgaged
Property or on Borrower’s or any Property Operator’s ability to operate any
Mortgaged Property as a Seniors Housing Facility, or the Licenses necessary for
the operation of a Seniors Housing Facility and/or any underlying License that
may be necessary in order to obtain a License necessary for the operation of a
Seniors Housing Facility.
(h)    Medicaid Provider Agreement.
(1)    If neither any Borrower nor the applicable Property Operator with respect
to a Mortgaged Property is a Medicaid Participant as of the Effective Date,
Borrower shall notify Lender in writing thirty (30) days prior to such
Borrower’s or Property Operator’s (with respect to the Mortgaged Property)
submission of its request to participate in the Medicaid Program, and will
provide Lender with copies of all material correspondence and documentation
received from the Property Jurisdiction or any authorizing entity concerning its
submission, reimbursement rates or eligibility as a Medicaid Participant. In the
event that (a) more than five percent (5%) of the effective gross income from
the Mortgaged Properties, in the aggregate, is derived from units relying on
Medicaid payments, and (b) more than twenty percent (20%) of the effective gross
income from any one Mortgaged Property is derived from units relying on Medicaid
payments provided that the threshold shall be increased to twenty-five percent
(25%) for the Mortgaged Property known as Brookdale Geary Street/Brookdale Grand
Prairie, Borrower and the Property Operator for such Mortgaged Property, as
applicable, shall execute a Medicaid reserve agreement and depositary agreement,
each in such form as is customarily required by Lender.
(2)    The following provisions apply if a Medicaid Provider Agreement is in
place as of the date the Mortgaged Property is added to the Collateral Pool or
entered into at any time the Mortgaged Property is subject to this Master
Agreement.
(A)    Borrower and Property Operator shall comply with the terms and conditions
of the Medicaid Provider Agreement and shall enforce the obligations of each
Managed Care Organization or Governmental Authority under the applicable
Medicaid Provider Agreement;
(B)    Borrower and Property Operator shall maintain their respective compliance
with the provider standards, including all conditions for participation, as
required by the Managed Care Organization or the Governmental Authority, as
applicable;
(C)    Borrower or Property Operator, as applicable, shall not permit or allow
(i) more than twenty percent (20%) of any one Mortgaged Property’s

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effective gross income to be derived from funds paid to Borrower or Property
Operator by a Governmental Authority or a Managed Care Organization, as
applicable under a Medicaid Provider Agreement, provided that the threshold
shall be increased to twenty-five percent (25%) for the Mortgaged Property known
as Brookdale Geary Street/Brookdale Grand Prairie, or (ii) more than five
percent (5%) of the aggregate Mortgaged Property’s effective gross income to be
derived from funds paid to Borrower or Property Operator by a Governmental
Authority or a Managed Care Organization, as applicable, under a Medicaid
Provider Agreement. Notwithstanding the foregoing, if Borrower or any Property
Operator is a Medicaid Participant with respect to the Mortgaged Property, and
if by reason of Applicable Law or regulation more than the income percentages
set forth above is derived from funds paid to such Borrower or Property Operator
by a Governmental Authority or a Managed Care Organization, Borrower and
Property Operator shall take in a diligent and expeditious manner all reasonable
steps necessary to comply with the preceding sentence to the extent permissible
by Applicable Law or regulation;
(D)    without the prior written consent of Lender, Borrower and Property
Operator shall not:
(i)    except as necessary to maintain its status as a Medicaid Provider, amend
or otherwise modify the then-current Medicaid Provider Agreement;
(ii)    terminate the then-current Medicaid Provider Agreement;
(iii)    waive a default under the then-current Medicaid Provider Agreement; or
(iv)    enter into a new Medicaid Provider Agreement or, except as necessary to
maintain its status as a Medicaid provider, renew or replace an existing
Medicaid Provider Agreement; and
(E)    within ten (10) days after Borrower’s or any Property Operator’s receipt
thereof, Borrower shall give Lender written notice of any notice or information
received by Borrower or any Property Operator that indicates that:
(i)    either Borrower or any Property Operator is in default under the terms of
the Medicaid Provider Agreement;
(ii)    the applicable Governmental Authority or Managed Care Organization
intends to terminate or materially amend or modify the Medicaid Provider
Agreement;

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(iii)    Borrower or Property Operator has ceased to meet the provider standards
required by the applicable Governmental Authority or Managed Care Organization;
(iv)    Borrower or Property Operator has received notice from any Governmental
Authority or Managed Care Organization that the rates for services provided
under the then-current Medicaid Provider Agreement will be adjusted; or
(v)    either Borrower or any Property Operator has been excluded from
participation in any Governmental Health Care Program with respect to the
Mortgaged Property or any other property.
(i)    Facility Operating Agreement.
(1)    The provisions of this Section 6.02(i)(1) (Facility Operating Agreement)
apply to all Facility Operating Agreements other than a Seniors Housing Facility
Lease and to all Property Operators other than a Property Operator under a
Seniors Housing Facility Lease. Borrower shall comply with and shall enforce the
obligations of each Property Operator under each Facility Operating Agreement.
Without the prior written consent of Lender, Borrower shall not:
(A)    modify, amend, supplement, or restate any Facility Operating Agreement
unless required by any Governmental Authority in connection with maintaining, in
good standing, all the Licenses, provided that Borrower provides immediate
notice thereof to Lender along with all material correspondence with the
applicable Governmental Authority as to why such modification, amendment,
supplement or restatement is to be made;
(B)    waive a default under any Facility Operating Agreement;
(C)    waive any of Borrower’s rights or fail to diligently pursue Borrower’s
remedies under the Facility Operating Agreement;
(D)    add or release a property to or from any Facility Operating Agreement
(other than in connection with a Release or Addition of a Mortgaged Property to
the Collateral Pool which shall be governed by this Master Agreement); or
(E)    violate the provisions of Section 11.02(c) (Facility Operating
Agreement).
(2)    Within five (5) days of Borrower’s receipt or delivery (or any Property
Operator’s receipt), Borrower shall provide Lender written notice of any notice
or information received by Borrower or any Property Operator that indicates
either Borrower

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or any Property Operator is (A) in default under the terms of any Facility
Operating Agreement, (B) amending, modifying, or terminating any Facility
Operating Agreement, or (C) otherwise discontinuing its operation and management
of the Mortgaged Property.
(3)    After Borrower receives notice (or otherwise has actual knowledge) of an
Event of Default under the Loan Documents, it will not make any payment of fees
under or pursuant to the Facility Operating Agreement without Lender’s prior
written consent.
(4)    Borrower shall cause each Property Operator, where applicable, to comply
with the terms, conditions, provisions, requirements, and affirmative and
negative covenants of this Master Agreement relating to the use and operation of
the Mortgaged Property, including all terms, conditions, provisions,
requirements, and affirmative and negative covenants set forth in this Master
Agreement applicable to the organization, existence, and good standing of
Property Operator necessary for the use and operation of the Mortgaged Property.
(j)    Change in Property Operator.
Each Property Operator and each Facility Operating Agreement must be approved in
writing in advance by Lender. Borrower shall not remove or permit or suffer the
removal of any Property Operator without the prior written consent of Lender and
unless and until Lender has approved in writing a replacement Property Operator;
provided, however, that Borrower may replace a Property Operator with an
Affiliated Property Operator without the prior written consent of Lender,
provided that (1) any Facility Operating Agreement or other similar agreement
between Borrower and an Affiliated Property Operator is approved in writing by
Lender, (2) Borrower and the new Affiliated Property Operator execute and
deliver to Lender a SASA in form acceptable to Lender, subject to the provisions
of Section 6.03(a) (Property Management), and (3) Borrower complies with the
notice requirements set forth below. Each Facility Operating Agreement or other
similar agreement between Borrower and a new Property Operator must be approved
in writing in advance by Lender, and Borrower and the new Property Operator must
execute and deliver to Lender a SASA in form required by Lender, subject to the
provisions of Section 6.03(a) (Property Management). Without limiting Borrower’s
obligation (if any) to obtain Lender’s consent pursuant to the second sentence
of this Section 6.02(i), Borrower shall notify Lender in writing of any removal,
replacement or name change of an Affiliated Property Operator or any change in
an Affiliated Property Operator’s place of incorporation or organization, which
notice shall be given at least ten (10) Business days in advance of such
removal, replacement, name change or change in Property Operator’s place of
incorporation or organization. Borrower agrees that Lender shall have the right
to remove any Property Operator at any time if an Event of Default has occurred
and is continuing, subject to the provisions of the SASA.
(k)    Contracts.
(1)    Borrower may in the future enter into Contracts for the provision of
additional goods or services at or otherwise in connection with the operation,
use, or management of each Mortgaged Property. Borrower absolutely and
unconditionally

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pledges, grants a security interest in and assigns to Lender all of Borrower’s
right, title and interest in, to and under all existing and future Contracts,
including Borrower’s right, power and authority to modify the terms of, extend
or terminate any such Contract. Until Lender gives notice to Borrower of
Lender’s exercise of its rights under this Master Agreement, Borrower shall have
all right, power and authority granted to Borrower under any Contract (except as
otherwise limited by this subsection or any other provision of this Master
Agreement), including the right, power and authority to modify the terms of any
Contract or extend or terminate any Contract. If an Event of Default has
occurred and is continuing, and at the option of Lender, the permission given to
Borrower pursuant to the preceding sentence to exercise all right, power and
authority under Contracts shall terminate. Upon Lender’s delivery of notice to
Borrower of an Event of Default, Lender shall immediately have all right, power
and authority granted to Borrower under any Contract, including the right, power
and authority to modify the terms of, extend or terminate any such Contract.
Borrower shall fully perform all of its obligations under the Contracts, and
Borrower agrees not to assign, sell, pledge, transfer, mortgage or otherwise
encumber its interests in any of the Contracts without the prior written
approval of Lender. Each Contract entered into by Borrower subsequent to the
date hereof, the average annual consideration of which, directly or indirectly,
is at least $50,000 shall provide: (A) that it shall be terminable for cause;
and (B) that it shall be terminable, at Lender’s option, upon the occurrence of
an Event of Default.
(2)    Borrower shall provide notice to Lender immediately if a National
Contract is terminated or expires and if the services or goods provided under
such National Contract are not replaced so as to avoid a disruption or cessation
of the same as a result of such termination or expiration.
(3)    If Borrower or a Mortgaged Property ceases to be entitled to the goods or
services provided under a National Contract, or ceases to receive such goods or
services and such goods or services are necessary to operate the Mortgaged
Property, Borrower shall immediately cause substantially identical goods or
services to be provided by a replacement counterparty so as to avoid any
disruption in the operation of the Mortgaged Property with respect to the
affected goods or services.
(l)    All Representations and Covenants Deemed Borrower Responsibility.
(1)    Any act, action, term, condition, provision, requirement, or covenant
required to be performed, or prohibited from being performed, by Borrower under
the Loan Documents including with respect to (A) the use, management or
operation of the Mortgaged Property, including any licensing, repair, reporting,
or insurance requirements, and (B) the organization, existence, good standing or
other entity-level requirements, shall be interpreted as requiring Borrower
either to perform such act or action directly or to cause Property Operator, a
property manager or other appropriate agent to perform such act or action. Any
right or privilege assigned or delegated by Borrower or Property Operator to any
other Person shall be construed as being accompanied by each relevant obligation
or

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restriction set forth in the Loan Documents or any Facility Operating Agreement,
as applicable.
(2)    In each instance that Borrower makes, or in the future renews or is
deemed to renew, a representation, warranty, or covenant in this Master
Agreement or the other Loan Documents regarding the condition, knowledge, acts,
or omissions of Property Operator or any Property Operator Business Information,
or the condition of the Mortgaged Property, Borrower does and shall do so with
full knowledge, after due inquiry (including the due inquiry of and by
Guarantor), of such information. Any reporting or compliance delay caused by
Property Operator or Guarantor shall not excuse Borrower’s timely performance of
the terms of this Master Agreement or the other Loan Documents. Borrower
acknowledges and agrees that Borrower’s reliance upon incorrect or incomplete
information received from Property Operator or Guarantor and the reporting of
the same to Lender, whether or not Borrower had actual knowledge that such
information was incorrect or incomplete and whether or not Borrower is otherwise
in violation of the terms of this Master Agreement, shall not be (and none of
Borrower, Property Operator, Guarantor, nor Key Principal shall assert) a
defense to Lender’s determination that an Event of Default has occurred or that
Borrower (or Guarantor) has incurred personal liability as set forth in Article
3 (Personal Liability) of this Master Agreement.
(m)    Oil, Gas and Mineral Reservations.
(1)     Borrower covenants that it shall promptly notify Lender in writing if
Borrower becomes aware of any proposed exercise of a counterparty’s rights under
a Mineral Rights Conveyance at any Mortgaged Property.
(2)    Borrower covenants that it shall not enter into, make, or consent to any
new Mineral Rights Conveyance with respect to the Mortgaged Property without the
prior written consent of Lender, Lender acknowledging that Lender shall have no
right to consent to the assignment or transfer of a Mineral Rights Conveyance
existing as of the Initial Effective Date if Borrower does not have the right to
consent to such assignment or transfer under the applicable Mineral Rights
Conveyance documents.
(3)    Borrower agrees to promptly notify Lender in writing in the event
Borrower becomes aware of any actual damage to any Mortgaged Property as a
result of or in any way relating to the exercise of any right under a Mineral
Rights Conveyance.
(4)    Borrower agrees to promptly notify Lender in writing of any damage to the
Mortgaged Properties occasioned by the exercise by the holder of any Mineral
Conveyance Rights. If material damage occurs to the Mortgaged Properties or any
improvements located thereon as a result of or in any way relating to the
exercise of any right under any Mineral Rights Conveyance or any subsidence
arising from any Mineral Rights Conveyance, then Borrower shall, within thirty
(30) Business Days of such damage, elect to either (a) pay any amounts required
to repair and restore such Mortgaged Property or any improvements located
thereon, in a good and workmanlike manner, to the equivalent

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of its original condition or condition immediately prior to the damage, or (b)
release such Mortgaged Property from the Collateral Pool in accordance with the
Mortgaged Property Release Schedule (including, without limitation, payment of
the Release Price). Such Release shall be in accordance with all provisions of
Schedule 10, including, without limitation, Sections (b)(1)(C) and (D) with
respect to the provision of a Substitute Mortgaged Property where applicable.
(n)    Zoning.
If (i) a condemnation or casualty occurs with respect to any of the Mortgaged
Properties known as Brookdale Corsicana, Brookdale Panama City and Brookdale
Leesburg MC, and (ii) the improvements on any such Mortgaged Property cannot be
reconstructed and operated as a Senior Housing Facility, pursuant to Applicable
Law, then Borrower will be obligated to release such Mortgaged Property from the
Collateral Pool in accordance with the Mortgaged Property Release Schedule
(including, without limitation, payment of the Release Price) within thirty (30)
days of such casualty or condemnation.
(o)    New York License Transfers.
(1)    For purposes of Sections 6.02(g)(3) and (j) of this Master Agreement,
Lender shall be deemed to have approved (a) the Transfer or reissuance of the
License for (i) the Brookdale Ithaca MC Mortgaged Property to CB Ithaca
Operator, Inc., (ii) the Brookdale Niagara MC Mortgaged Property to CB Niagara
Operator, Inc., and (iii) the Brookdale Clinton MC Mortgaged Property to CB
Clinton Operator, Inc., and (b) each New Operator as a Property Operator,
provided that Borrower shall provide the following to Lender:
(A)within ten (10) days after the date of each such Transfer or reissuance:
(i)    copies of the reissued or Transferred Licenses,
(ii)    copies of any Management Agreement entered into by such New Operator,
which Management Agreement has been approved by Lender in accordance with
Section 6.03(a), and
(iii)    copies of any Operating Lease entered into between Borrower and such
New Operator, which Operating Lease shall be satisfactory to Lender.
(B)within ten (10) days after Lender has delivered a form of SASA to Borrower:
(i)    SASAs from such New Operator and any Manager for the Mortgaged Property,
which SASAs shall be substantially the same form and

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content as those SASAs delivered to Lender on the Effective Date and shall be
duly executed and delivered by such New Operator and any Manager, as applicable,
and Borrower, and
(ii)    customary corporate and licensing legal opinions related to such
reissued or Transferred License and SASAs that are satisfactory to Lender.
(2)    In connection with Borrower’s obligations under this Section 6.02(o),
Borrower shall pay to Lender upon demand:
(A)    review fees for Lender’s review of the items described in Section
6.02(l)(2) for each of the three Mortgaged Properties in the amounts of $1,500
each; and
(B)    all of Lender’s out-of-pocket costs (including reasonable attorneys’
fees) incurred in reviewing, negotiating, and drafting the items described in
Section 6.02(l)(2).
(p)    Brookdale Cypress Station.
As of the Initial Effective Date, the Mortgaged Property known as Brookdale
Cypress Station has unoccupied units that had previously been leased to a third
party and used as a hospice facility (the “Hospice Units”). Borrower shall have
the right to either (a) utilize the Hospice Units as assisted living units,
which Borrower represents requires no change in licensure, or (b) convert the
Hospice Units to light memory care units, in all cases, provided that the
following conditions are satisfied:
(1)    Borrower provides Lender with at least thirty (30) days prior written
notice that it intends to put the Hospice Units back in service, and identifying
the use of such units;
(2)    If any Alterations are required in connection with putting the Hospice
Units back in service, Borrower complies with the terms of this Master Agreement
with respect to the making of any such Alterations;
(3)    If any new Management Agreement or Operating Lease is entered into in
conjunction with the reissued License, copies of any such Management Agreement
or Operating Lease which shall be in substantially the same form and content as
the Management Agreement or Operating Lease entered into by the applicable
Property Operator as of the Initial Effective Date;

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(4)    If required, a new SASA from the applicable Borrower and Property
Operator in substantially the same form and content as those SASAs delivered to
Lender;
(5)    If Borrower elects to convert the Hospice Unites into light memory care
units, then prior to putting the Hospice Units into service, Borrower shall
deliver to Lender copies of the reissued healthcare License together with
customary corporate and licensing legal opinions related to such reissued
License and SASAs, if applicable, that are satisfactory to Lender;
(6)    If applicable, Borrower will obtain any use or zoning permits necessary
to operate the units and provide evidence that the Mortgaged Property known as
Brookdale Cypress Station is not negatively impacted by the change in use; and
(7)    Borrower pays all of Lender’s out-of-pocket costs (including reasonable
attorneys’ fees) incurred in reviewing, negotiating, and drafting the items
described in Section 6.02(p).
(q)    Brookdale Ithaca AL
As of the Initial Effective Date, the Mortgaged Property known as Brookdale
Ithaca AL contains an expansion building that is unoccupied, pending regulatory
approval of the applicable licensing authority. From and after the Effective
Date, Borrower shall use diligent, commercially reasonable efforts to pursue
approval from the applicable licensing authority so that the healthcare License
is reissued to include the expansion building and Borrower shall not allow any
residents to reside in such expansion building until the reissued license is
obtained. Within ten (10) days of the date of reissuance of such healthcare
License, Borrower shall provide a copy of the same to Lender along with
customary licensing legal opinions related to such reissued healthcare License.
Until such healthcare License is reissued, Borrower shall provide an update to
Lender simultaneously with the submission of its quarterly financials describing
in reasonable detail the status of its efforts to obtain such reissued
healthcare License and of any requirements of the applicable licensing
authority. Borrower shall promptly respond to any inquiries of Lender for
additional information regarding the status of the reissued healthcare License.
(r)    Brookdale W. Eisenhower Pkwy, Brookdale Lakeway AL/MC and Brookdale
Northwest Hills
Borrower hereby covenants and agrees that, within one hundred eighty (180) days
after the Initial Effective Date, it shall deliver to Lender evidence of the
applicable Licensing Authority’s renewal of the healthcare license for each of
Brookdale W. Eisenhower Parkway, Brookdale Lakeway AL/MC and Brookdale Northwest
Hills together with (A) a copy of the renewal license, and (B) a licensing
opinion. Failure by

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Borrower to deliver the foregoing to Lender within such one hundred eighty (180)
day time period shall be an Event of Default under this Master Agreement;
provided, however, that in the event that Borrower has not delivered to Lender
evidence of the applicable Licensing Authority’s renewal together with the
related licensing opinion within one hundred eighty (180) days after the Initial
Effective Date solely due to a delay on the part of the applicable Licensing
Authority, Borrower shall not be in default hereunder for so long as Borrower
causes Affiliated Property Operator to use reasonably diligent efforts to obtain
each such consent from the applicable Licensing Authority together with the
licensing opinion and, upon Lender’s request, provides updates to Lender
regarding the status.
(s)    Condominium Provisions.
(1)    Liens; Encumbrances.
Borrower shall not in any way consent to any pledge, sale, conveyance or
encumbrance or the entry into a contract or agreement to pledge, sell, convey or
encumber any of the common elements of the Condominium unless expressly agreed
to in writing by Lender.
(2)    Condominium Assessments.
Notwithstanding Borrower’s payment of annual assessments or special assessments
levied under the terms of the Condominium Documents to provide any repairs to or
maintenance of any of the common elements, Borrower shall deposit any
Replacement Reserve Deposit and Repairs Escrow Deposit required pursuant to the
terms of this Master Agreement.
(t)    Brookdale Santa Monica.
Borrower agrees to promptly notify Lender in writing in the event Borrower
becomes aware of (i) any defaults under the Ground Lease, (ii) the intention of
the ground lessor under the Ground Lease to encumber the Mortgaged Property
known as Brookdale Santa Monica with a deed of trust on the ground lessor’s fee
interest, (iii) the ground lessor’s rejection or threatened rejection in writing
of any renewal of the Ground Lease, (iv) any condemnation or casualty with
respect to the Mortgaged Property known as Brookdale Santa Monica, and/or (v)
any other material matters related to the Ground Lease or the Mortgaged Property
known as Brookdale Santa Monica.
Section 6.03    Administration Matters Regarding the Property.
(a)    Property Management.
Notwithstanding any provisions to the contrary set forth herein, Lender hereby
approves the Operating Lease and/or Management Agreement in effect as of the
Initial Effective Date between Borrower and the applicable Affiliated Property
Operator. From and after the Effective

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Date, each Property Operator (other than an Affiliated Property Operator
pursuant to this Section 6.03(a)) and each Facility Operating Agreement must be
approved by Lender. In the event that the Facility Operating Agreement expires
or is terminated (without limiting any obligation of Borrower to obtain Lender’s
consent to any termination or modification of the Facility Operating Agreement
in accordance with the terms and provisions of the Loan Documents) or the
renewal of Management Agreements relating to the Mortgaged Properties located in
New York are not timely approved by the applicable Governmental Authority,
Borrower shall promptly enter into a replacement facility operating agreement
consented to in writing by Lender with a Property Operator that is approved in
advance by Lender in writing, and, in the case of the Mortgaged Properties
located in New York, approved in advance by the applicable Governmental
Authority in writing.  If the replacement property manager is an Affiliated
Property Operator, then Lender (but not any Governmental Authority having
jurisdiction in New York) shall be deemed to have approved such Affiliated
Property Operator as a replacement property manager; and Lender’s approval shall
only be required in connection with the replacement management agreement. If, in
connection with the making of the Advances, or at any later date, Lender waives
in writing the requirement that Borrower enter into a written contract for the
operation or management of a Mortgaged Property, and Borrower later elects to
enter into a written contract or change the operation or management of such
Mortgaged Property, or if Borrower transfers management of a Mortgaged Property,
such new Property Operator (other than an Affiliated Property Operator) and any
Facility Operating Agreement (including that with an Affiliated Property
Operator) must be approved by Lender. As a condition to any approval of a
Property Operator by Lender of or any Facility Operating Agreement pursuant to
this Section 6.03(a) (Property Management), Borrower and such new Property
Operator shall enter into a SASA.
(b)    Subordination of Fees by Property Operator.
All fees due to an Affiliated Property Operator in connection with the operation
and management of the Mortgaged Property shall be subordinated in right to the
prior payment in full of the Indebtedness. All fees due to a non-Affiliated
Property Operator in connection with the operation and management of the
Mortgaged Property shall be subordinated in right of payment to the prior
payment in full of monthly debt service and funding of escrows and reserves as
required under the Loan Documents, and the payment of all operating expenses and
capital expenditures incurred in connection with the operation and management of
the Mortgaged Property.
(c)    Property Condition Assessment.
If, in connection with any inspection of any Mortgaged Property, Lender
determines that the condition of such Mortgaged Property has deteriorated
(ordinary wear and tear excepted) since the Effective Date that such Mortgaged
Property was added to the Collateral Pool, Lender may obtain, at Borrower’s
expense, a property condition assessment of each Mortgaged Property. Lender’s
right to obtain a property condition assessment pursuant to this Section 6.03(c)
(Property Condition Assessment) shall be in addition to any other rights
available to Lender under this Master Agreement in connection with any such
deterioration. Any such inspection or property condition assessment may result
in Lender requiring Additional Lender Repairs or Additional Lender Replacements
as further described in Section 13.02(a)(9)(B) (Additional Lender

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Replacements and Additional Lender Repairs).
ARTICLE 7    
LEASES AND RENTS
Section 7.01    Representations and Warranties.
The representations and warranties made by Borrower to Lender in this Section
7.01 (Leases and Rents – Representations and Warranties) are made as of each
Effective Date and are true and correct except as disclosed on the Exceptions to
Representations and Warranties Schedule.
(a)    Prior Assignment of Rents.
Borrower has not executed any:
(1)    prior assignment of Rents (other than an assignment of Rents securing
prior indebtedness that has been paid off and discharged or will be paid off and
discharged with the proceeds of the Initial Advance or a Future Advance); or
(2)    instrument which would prevent Lender from exercising its rights under
this Master Agreement, the Security Instrument, or the SASA.
(b)    Prepaid Rents.
Borrower has not accepted, and does not expect to receive prepayment of, any
Rents for more than one (1) month for the Seniors Housing Facility Lease or more
than two (2) months under any other Lease prior to the due dates of such Rents.
(c)    Seniors Housing Facility Lease.
(1)    The Seniors Housing Facility Lease is in full force and effect and there
is neither a default thereunder nor any condition that, with the passage of time
or the giving of notice, or both, would constitute a default thereunder. No
right or claim of rescission, offset, abatement, diminution, defense, or
counterclaim has been asserted with respect to the Seniors Housing Facility
Lease, and there is no existing condition that, with the passage of time or
giving of notice, or both, would result in a right or claim of rescission,
offset, abatement, diminution, defense, or counterclaim under the terms and
provisions of the Seniors Housing Facility Lease. Borrower has performed and
discharged all of the obligations on the part of Borrower to be performed and
discharged pursuant to the terms set forth in the Seniors Housing Facility
Lease.
(2)    The Seniors Housing Facility Lease has not been modified, amended or
supplemented by either party thereto. The Property Operator has not been
released, in whole or in part, from any of its obligations under the Seniors
Housing Facility Lease. There has been no prior sale, transfer, assignment,
hypothecation, or pledge of the Seniors

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Housing Facility Lease (other than in connection with the Loan Documents) that
is outstanding.
(3)    The Seniors Housing Facility Lease has an original term ending on or
after the date ninety (90) days after the Maturity Date. Absent Lender’s
direction, the Property Operator cannot terminate the Seniors Housing Facility
Lease for any reason prior to the payment in full of the Indebtedness.
(4)    There is no free rent, partial rent or rebate of rent required to be
given by Borrower to Property Operator under the Seniors Housing Facility Lease.
The Seniors Housing Facility Lease does not permit Property Operator to accept,
and Property Operator has not accepted, prepayment of Rents more than two (2)
months in advance (and Borrower has not accepted prepayment of Rents more than
one (1) month in advance with respect to the Seniors Housing Facility Lease).
Each payment due under the Seniors Housing Facility Lease is sufficient to pay
the Debt Service Amounts (including Monthly Debt Service Payments, Taxes,
Impositions, and any Replacement Reserve Deposits) in full on or prior to the
due date thereof (without giving effect to any applicable grace periods)
currently and throughout the term of this Master Agreement. Payments due under
the Seniors Housing Facility Lease are payable without notice or demand, and
without setoff, recoupment, abatement, or reduction.
(5)    Property Operator has no right or option pursuant to the Seniors Housing
Facility Lease or otherwise to purchase all or any part of the Mortgaged
Property, the leased premises or the building of which the leased premises are a
part.
(6)    The Seniors Housing Facility Lease contains customary and enforceable
provisions that render the rights and remedies of Borrower adequate for the
enforcement and satisfaction of the Borrower’s rights thereunder.
(7)    Borrower represents and warrants that it is the express intent of
Borrower and Property Operator that the Seniors Housing Facility Lease
constitute a lease under applicable real property laws and laws governing
bankruptcy, insolvency, and creditors’ rights generally, and that the sole
interest of Property Operator in the Mortgaged Property is as a tenant under the
Seniors Housing Facility Lease. The Seniors Housing Facility Lease is not
intended to be deemed a guaranty.
Section 7.02    Covenants.
(a)    Leases.
Borrower shall:
(1)    comply with and observe all landlord obligations under all Leases,
including landlord’s obligations pertaining to the maintenance and disposition
of tenant security deposits or any other refundable fees including entrance fees
or community fees;

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(2)    surrender possession of the applicable Mortgaged Property, including all
Leases and all security deposits and prepaid Rents, immediately upon appointment
of a receiver or Lender’s entry upon and taking of possession and control of
such Mortgaged Property, as applicable;
(3)    require that Affiliated Property Operator shall require all Residential
Leases have initial lease terms of not less than one (1) month; and
(4)    promptly provide Lender a copy of any non-Residential Lease at the time
such Lease is executed (subject to Lender’s consent rights for Material
Commercial Leases in Section 7.02(b) (Commercial Leases) and subject to Lender’s
consent rights for the Seniors Housing Facility Lease pursuant to Section
6.02(j) (Change in Property Operator) and the SASA), and, upon Lender’s written
request, promptly provide Lender a copy of any Residential Lease then in effect.
(b)    Commercial Leases.
(1)    With respect to Material Commercial Leases, Borrower shall not:
(A)    enter into any Material Commercial Lease except with the prior written
consent of Lender; or
(B)    terminate or adversely modify the terms (other than pursuant to the terms
of the previously Lender Approved Material Commercial Lease) of any Material
Commercial Lease (including any Material Commercial Lease in existence on the
Effective Date), without the prior written consent of Lender.
(2)    With respect to any non-Material Commercial Lease, Borrower shall not:
(A)    except for leases that are entered into pursuant to unit conversions
permitted pursuant to the last paragraph of Section 6.02(a) (Use of Property)
and modifications to use permitted under Section 6.02(a)(1)(Use of Property) or
approved in connection with Section 6.02(f), enter into any non-Material
Commercial Lease that materially alters the use and type of operation of the
premises subject to the Lease in effect as of the Effective Date or reduces the
number or size of residential units at a Mortgaged Property; or
(B)    modify the terms of any non-Material Commercial Lease (including any
non-Material Commercial Lease in existence on the Effective Date) in any way
that materially alters the use and type of operation of the premises subject to
such non-Material Commercial Lease in effect as of the Effective Date, reduces
the number or size of residential units at a Mortgaged Property, or results in
such non-Material Commercial Lease being deemed a Material Commercial Lease.

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(3)    With respect to any Material Commercial Lease or non-Material Commercial
Lease, Borrower shall use commercially reasonable efforts to cause the
applicable tenant to provide within ten (10) days after a request by Lender, a
certificate of estoppel, or if not provided by tenant within such ten (10) day
period, Borrower shall provide such certificate of estoppel, certifying:
(A)    that such Material Commercial Lease or non-Material Commercial Lease is
unmodified and in full force and effect (or if there have been modifications,
that such Material Commercial Lease or non-Material Commercial Lease is in full
force and effect as modified and stating the modifications);
(B)    the term of the Lease including any extensions thereto;
(C)    the dates to which the Rent and any other charges hereunder have been
paid by tenant;
(D)    the amount of any security deposit delivered to Borrower as landlord;
(E)    whether or not Borrower is in default (or whether any event or condition
exists which, with the passage of time, would constitute an event of default)
under such Lease;
(F)    the address to which notices to tenant should be sent; and
(G)    any other information as may be reasonably required by Lender.
(c)    Payment of Rents.
Borrower shall:
(1)    pay to Lender upon demand all Rents after an Event of Default has
occurred and is continuing;
(2)    cooperate with Lender’s efforts in connection with the assignment of
Rents set forth in the Security Instrument and the SASA; and
(3)    not seek to collect any Rents prior to the due dates of such Rents (it
being acknowledged that the sending of invoices for Rents by Borrower in the
ordinary course shall not be deemed a violation of this Section 7.02(c)), and
shall not accept Rent under: (a) any Lease (whether residential or
non-residential) for more than two (2) months in advance; and (b) any Seniors
Housing Facility Lease more than one (1) month in advance, except that Borrower
may accept Rents not more than (3) months in advance under Leases for not more
than ten percent (10%) of the units in the Collateral Pool, in the aggregate.

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(d)    Assignment of Rents.
Borrower shall not:
(1)    perform any acts nor execute any instrument that would prevent Lender
from exercising its rights under the assignment of Rents granted in the Security
Instrument, the SASA, or in any other Loan Document; nor
(2)    interfere with Lender’s collection of such Rents.
(e)    Further Assignments of Leases and Rents.
Borrower shall execute and deliver any further assignments of Leases and Rents
as Lender may reasonably require, and shall require Property Operator to execute
and deliver any corresponding assignments in support thereof.
(f)    Options to Purchase by Tenants.
No Lease (whether a Residential Lease or a non-Residential Lease) shall contain
an option to purchase, right of first refusal to purchase or right of first
offer to purchase, except as set forth in the SASA, except as required by
Applicable Law.
(g)    Special Covenants Regarding Seniors Housing Facility Lease.
(1)    Seniors Housing Facility Lease.
(A)    Borrower shall:
(i)    at all times fully perform, observe, and comply with all terms,
covenants, and conditions of the Seniors Housing Facility Lease to be performed,
observed, or complied with by Borrower as lessor under the Seniors Housing
Facility Lease and do all things necessary to preserve and to keep unimpaired
its rights thereunder;
(ii)    deliver to Lender, within five (5) days after Borrower’s receipt, a true
and correct copy of each written notice, demand, complaint, or request from
Property Operator under, or with respect to, the Seniors Housing Facility Lease;
(iii)    simultaneously deliver to Lender a true and correct copy of each
written notice, demand, complaint, or request that Borrower sends to Property
Operator under, or with respect to, the Seniors Housing Facility Lease;
(iv)    to the extent not otherwise covered in Article 8 (Books and Records,
Financial Reporting) of this Master Agreement, upon written

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request from Lender, deliver to Lender a copy of all business plans, if any,
received by Borrower and any other information reasonably requested by Lender;
(v)    enforce the terms, covenants and conditions contained in the Seniors
Housing Facility Lease; and
(vi)    provide Property Operator with written notice of any changes to Monthly
Debt Service Payments, Imposition Deposits, Monthly Replacement Reserve
Deposits, or any other amounts due under the Loan Documents.
(B)    Borrower shall not:
(i)    modify, amend, supplement, or restate the Seniors Housing Facility Lease
either orally or in writing;
(ii)    waive a default under the Seniors Housing Facility Lease;
(iii)    waive any of Borrower’s rights or fail to diligently pursue Borrower’s
remedies under the Seniors Housing Facility Lease;
(iv)    add or release a property to or from any Seniors Housing Facility Lease
(other than in connection with a Release or Addition of a Mortgaged Property to
the Collateral Pool which shall be governed by this Master Agreement); or
(v)    violate the provisions of Section 11.02(b)(3) (Name Change or Entity
Conversion).
If, pursuant to the Seniors Housing Facility Lease, Property Operator requests
(1) the consent of Borrower (in its capacity as lessor under the Seniors Housing
Facility Lease) or Borrower’s designee to any matter as to which, pursuant to
the Seniors Housing Facility Lease, Borrower has discretion as to whether or not
to grant its consent, (2) a waiver of any covenant or obligation of Property
Operator under the Seniors Housing Facility Lease, or (3) a modification of the
terms of the Seniors Housing Facility Lease (any of the foregoing, a “Seniors
Housing Facility Lease Request”), Borrower shall give Lender prompt written
notice of such Seniors Housing Facility Lease Request (together with such
supporting information as may reasonably be required to consider such Seniors
Housing Facility Lease Request, and such other information as Lender may
reasonably request). Borrower shall not approve or consent to any Seniors
Housing Facility Lease Request unless Lender has approved and consented in
writing to such Seniors Housing Facility Lease Request.
(C)    The Seniors Housing Facility Lease shall:

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(i)    pursuant to the SASA, be subject and subordinate in all respects to the
liens, terms, covenants and conditions of the Security Instrument and the other
Loan Documents, and to all renewals, modifications, consolidations, replacements
and extensions thereof, and to all advances which may hereafter be made pursuant
to the Note, this Master Agreement, the Security Instrument and the other Loan
Documents (including all sums advanced for the purposes of (1) protecting or
further securing the lien of the Security Instrument, curing defaults by
Borrower under the Loan Documents, or for any other purposes expressly permitted
by this Master Agreement, the Security Instrument or the other Loan Documents,
or (2) constructing, renovating, repairing, furnishing, fixturing, or equipping
the Mortgaged Property); and
(ii)    provide that, in the event it shall be determined that the Seniors
Housing Facility Lease is not a lease under applicable real property laws or
under laws governing bankruptcy, insolvency, and creditors’ rights generally,
and that the interest of Property Operator in the Mortgaged Property is other
than that of tenant under the Seniors Housing Facility Lease, then the Property
Operator’s interest in the Mortgaged Property, however characterized, shall
continue to be subject and subordinate to the lien, terms, and conditions of the
Security Instrument, and Borrower’s fee interest in the Mortgaged Property, on
all the same terms and conditions as contained in the Seniors Housing Facility
Lease as of the date the Mortgaged Property was added to the Collateral Pool.
(D)    The Seniors Housing Facility Lease shall provide that Borrower shall
continue to have complete access as long as the Mortgaged Property is part of
the Collateral Pool to the organizational, financial, and operational
information and documentation of Property Operator in every respect as it
relates to this Master Agreement, the Mortgaged Property, and the Seniors
Housing Facility Lease (collectively, the “Property Operator Business
Information”). Borrower shall continue to be fully informed regarding the
Property Operator Business Information to the same extent as if Borrower were
the day-to-day operator of the Mortgaged Property and the business activities
thereon.
(2)    Seniors Housing Facility Lease Estoppel.
With respect to any Seniors Housing Facility Lease, Borrower shall cause
Property Operator to provide as of the date the Mortgaged Property is added to
the Collateral Pool (and, after the date the Mortgaged Property is added to the
Collateral Pool, within ten (10) days after a request by Lender), an Operator
Estoppel Certificate, or if not provided by Property Operator within such ten
(10) day period, Borrower shall provide a certificate of estoppel (and the
Seniors Housing Facility Lease shall so empower Borrower as Property Operator’s
attorney-in-fact) substantially in the form of the Operator Estoppel
Certificate.

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Section 7.03    Administration Regarding Leases and Rents.
(a)    Material Commercial Lease Requirements.
Each Material Commercial Lease, including any renewal or extension of any
Material Commercial Lease in existence as of the Effective Date, shall provide,
directly or pursuant to a subordination, non-disturbance and attornment
agreement approved by Lender, that:
(1)    the tenant shall, upon written notice from Lender after the occurrence of
an Event of Default, pay all Rents payable under such Lease to Lender;
(2)    such Lease and all rights of the tenant thereunder are expressly
subordinate to the lien of the Security Instrument;
(3)    the tenant shall attorn to Lender and any purchaser at a Foreclosure
Event (such attornment to be self-executing and effective upon acquisition of
title to the Mortgaged Property by any purchaser at a Foreclosure Event or by
Lender in any manner);
(4)    the tenant agrees to execute such further evidences of attornment as
Lender or any purchaser at a Foreclosure Event may from time to time request;
and
(5)    such Lease shall not terminate as a result of a Foreclosure Event unless
Lender or any other purchaser at such Foreclosure Event affirmatively elects to
terminate such Lease pursuant to the terms of the subordination, non-disturbance
and attornment agreement.
(b)    Residential Lease Form.
All Residential Leases entered into from and after the Effective Date shall be
on forms approved by Lender with such changes, without Lender’s consent, as
necessary to comply with Applicable Law or as are immaterial but necessary for
business purposes; provided that any changed lease forms shall be delivered to
Lender upon implementation. Except to the extent prohibited by Applicable Law,
any Lease entered into by Property Operator will be subject and subordinate to
the Seniors Housing Facility Lease and will not relieve the Property Operator of
its obligations under the Seniors Housing Facility Lease.
(c)    Seniors Housing Facility Lease Structure Consideration.
The agreements set forth in this Master Agreement constitute a material portion
of the consideration for Lender agreeing to make the Advances and permit the
Seniors Housing Facility Lease operating structure described in the Seniors
Housing Facility Lease.

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ARTICLE 8    
BOOKS AND RECORDS; FINANCIAL REPORTING
Section 8.01    Representations and Warranties.
The representations and warranties made by Borrower to Lender in this Section
8.01 (Books and Records; Financial Reporting – Representations and Warranties)
are made as of each Effective Date and are true and correct except as disclosed
on the Exceptions to Representations and Warranties Schedule.
(a)    Financial Information.
All financial statements and data, including statements of cash flow and income
and operating expenses, that have been delivered to Lender in respect of the
Mortgaged Properties:
(1)    are true, complete, and correct in all material respects; and
(2)    accurately represent the financial condition of the Mortgaged Properties
and present fairly the financial condition of Borrower and Guarantor as of the
date set forth therein.
(b)    No Change in Facts or Circumstances.
All information in the Loan Application and in all financial statements, rent
rolls, reports, certificates, and other documents submitted in connection with
the Loan Application are complete and accurate in all material respects. There
has been no material adverse change in any fact or circumstance that would make
any such information incomplete or inaccurate.
Section 8.02    Covenants.
(a)    Obligation to Maintain Accurate Books and Records; Access; Discussions
with Officers and Accountants.
(1)    Borrower shall keep and maintain at all times at the Mortgaged Property,
the property management agent’s offices, Borrower’s General Business Address, or
Property Operator’s General Business Address, as applicable, and, upon Lender’s
written request, shall make available to Lender at the Land:
(A)    complete and accurate books of account and records (including copies of
supporting bills and invoices) adequate to reflect correctly the operation of
the Mortgaged Property; and
(B)    copies of all written contracts, Leases and other instruments that affect
Borrower, Property Operator (with respect to the Mortgaged Property), or the
Mortgaged Property.

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(2)    To the extent permitted by Applicable Law and subject to the provisions
of Section 6.02(d) (Property Inspections), Borrower shall permit Lender to:
(A)    inspect, make copies and abstracts of, and have reviewed, at no expense
to Borrower except in the case of non-routine inspections or if an Event of
Default exists, such of Borrower’s books and records as may relate to the
obligations of Borrower under this Master Agreement and the other Loan Documents
or the Mortgaged Properties.
(B)    at any time discuss Borrower’s affairs, finances, and accounts with
Senior Management or Property Operators and independent public accountants;
(C)    discuss the Mortgaged Properties’ conditions, operation, or maintenance
with the Property Operator, the officers, and employees of Borrower, Guarantor,
and Key Principal; and
(D)    receive any other information that Lender reasonably deems necessary or
relevant in connection with any Loan Document or the obligations of Borrower
under this Master Agreement from the officers and employees of such Borrower.
(3)    Borrower shall promptly inform Lender in writing of:
(A)    the occurrence of any act, omission, change, or event that has, or would
have, a Material Adverse Effect, subsequent to the date of the most recent
financial statements of Borrower delivered to Lender pursuant to Section 8.02
(Books and Records; Financial Reporting – Covenants); and
(B)    any material change in Borrower’s accounting policies or financial
reporting practices.
(b)    Items to Furnish to Lender.
Subject to Privacy Laws, Borrower shall furnish to Lender the following,
certified as true, complete, and accurate, in all material respects, by an
individual having authority to bind Borrower (or Operator, if any, other than a
Waived Operator, or Guarantor, as applicable), in such form and with such detail
as Lender reasonably requires
(1)    Within sixty (60) days after the end of each Calendar Quarter, a
statement of income and expenses of Operator, if any (other than a Waived
Operator) and Key Principal and Guarantor on a Calendar Quarter basis as of the
end of each Calendar Quarter;
(2)    within forty-five (45) days after the end of each Calendar Quarter, a
statement of income and expenses of each Mortgaged Property on a Calendar
Quarter basis as of the end of each Calendar Quarter. Simultaneously with
delivery of the items set forth

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above, Borrower shall submit its so-called “Revenue By Payor Source” Medicaid
report individually for each Mortgaged Property. Borrower shall report Medicaid
on such statements in the same way it reports Medicaid as of the Initial
Effective Date;
(3)    within one hundred twenty (120) days after the end of each Calendar Year:
(A)     for any Mortgaged Property, and any Guarantor that is an entity, a
statement of income and expenses and a statement of cash flows for such Calendar
Year;
(B)    For (i) any individual that is a (x) Borrower, (y) Property Operator (in
connection with the operation of the Mortgaged Property) or (z) Guarantor, or
(ii) a trust established for estate-planning purposes, a personal financial
statement for such Calendar Year
(C)    when requested in writing by Lender, balance sheet(s) showing all assets
and liabilities of Borrower, any Property Operator (in connection with the
operation of the Mortgaged Property), and Guarantor and a statement of all
contingent liabilities require to be reported under GAAP as of the end of such
Calendar Year;
(D)    if an energy consumption metric for the Mortgaged Property is required to
be reported to any Governmental Authority, the Fannie Mae Energy Performance
Metrics report, as generated by ENERGY STAR® Portfolio Manager, for the
Mortgaged Property for such Calendar Year, which report must include the ENERGY
STAR score, the Source Energy Use Intensity (EUI), the month and year ending
period for such ENERGY STAR score and such Source Energy Use Intensity, and the
ENERGY STAR Portfolio Manager Property Identification Number; provided that, if
the Governmental Authority does not require the use of ENERGY STAR Portfolio
Manager for the reporting of the energy consumption metric and Borrower does not
use ENERGY STAR Portfolio Manager, then Borrower shall furnish to Lender the
Source Energy Use Intensity for the Mortgaged Property for such Calendar Year;
(E)    an Annual Certification (Borrower) in the form attached as Exhibit G;
(F)    an Annual Certification (Guarantor) in the form attached as Exhibit H;
(G)    an accounting of all security deposits held pursuant to all Leases,
including the name of the institution (if any) and the names and identification
numbers of the accounts (if any) in which such security deposits are held and
the name of the person to contact at such financial institution, along with any
authority or release necessary for Lender to access information regarding such
accounts;

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(H)    written confirmation of:
(i)    any changes occurring since the Effective Date (or that no such changes
have occurred since the Effective Date) in (1) the direct owners of Borrower,
(2) the indirect owners (and any non-member managers) of Borrower that Control
Borrower or own a Restricted Ownership Interest in Borrower (excluding any
Publicly-Held Corporations or Publicly-Held Trusts or their direct or indirect
owners), or (3) the indirect owners of Borrower that hold twenty-five percent
(25%) or more of the ownership interests in Borrower (excluding any
Publicly-Held Corporations or Publicly-Held Trusts or their direct or indirect
owners), and their respective interests;
(ii)    the names of all officers and directors of (1) any Borrower which is a
corporation, (2) any corporation which is a general partner of any Borrower
which is a partnership, or (3) any corporation which is the managing member or
non-member manager of any Borrower which is a limited liability company;
(iii)    the names of all managers who are not members of (1) any Borrower which
is a limited liability company, (2) any limited liability company which is a
general partner of any Borrower which is a partnership, or (3) any limited
liability company which is the managing member or non-member manager of any
Borrower which is a limited liability company;
(iv)    any changes occurring since the Effective Date (or that no such changes
have occurred since the Effective Date) in (1) the direct owners of Affiliated
Property Operator, (2) the indirect owners (and any non-member managers) of
Affiliated Property Operator that Control Affiliated Property Operator
(excluding any Publicly-Held Corporations or Publicly-Held Trusts or their
direct or indirect owners), or (3) the indirect owners of Affiliated Property
Operator that hold twenty-five percent (25%) or more of the ownership interests
in Affiliated Property Operator (excluding any Publicly-Held Corporations or
Publicly-Held Trusts or their direct or indirect owners), and their respective
interests;
(v)    the names of all officers and directors of (1) any Affiliated Property
Operator that is a corporation, (2) any corporation which is a general partner
of any Affiliated Property Operator which is a partnership, or (3) any
corporation which is the managing member or non-member manager of any Property
Operator which is a limited liability company; and
(vi)    the names of all managers who are not members of (1) any Property
Operator which is a limited liability company, (2) any limited liability company
which is a general partner of any Affiliated Property

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Operator which is a partnership, or (3) any limited liability company which is
the managing member or non-member manager of any Affiliated Property Operator
which is a limited liability company;
(I)    if not already provided pursuant to Section 8.02(b)(1) (Items to Furnish
to Lender) above, a statement of income and expenses for the Mortgaged Property
on a year-to-date basis as of the end of each Calendar Year;
(4)    within forty-five (45) days after the end of each Calendar Quarter, and
at any other time upon Lender’s written request, a rent schedule for the
Mortgaged Property showing the name of each tenant and for each tenant, the
space occupied, the lease expiration date, the lease term, the rent payable for
the current month, the date through which rent has been paid, and any related
information requested by Lender;
(5)    within ten (10) Business Days after Borrower’s receipt, copies of all
inspection reports, surveys, reviews and certifications prepared by, for, or on
behalf of any licensing or regulatory authority relating to the Mortgaged
Property and any legal actions, orders, notices, or reports relating to the
Mortgaged Property issued by the applicable regulatory or licensing authorities,
which in any instance would cause any Borrower to be in noncompliance with any
term or covenant in this Master Agreement; provided, however, that within ten
(10) Business Days after Borrower’s receipt, Borrower will deliver copies of the
annual license surveys prepared by, for, or on behalf of any licensing or
regulatory authority relating to the Mortgaged Property;
(6)    within ten (10) days after submission, copies of all incident reports
submitted by or on behalf of Borrower or any Property Operator to any liability
insurance carrier or any elderly affairs, regulatory or licensing authority; and
(7)    upon Lender’s written request (but, absent an Event of Default, no more
frequently than once in any six (6) month period):
(A)    any item described in Section 8.02(b)(1) or Section 8.02(b)(2) (Items to
Furnish to Lender) in connection with the operation of the Mortgaged Property,
if any, certified as true, complete, and accurate by an individual having
authority to bind Borrower or such Property Operator;
(B)    a property management or leasing report for the Mortgaged Property,
showing the number of rental applications received from tenants or prospective
tenants and deposits received from tenants or prospective tenants, and any other
information requested by Lender;
(C)    a statement of income and expenses for the Mortgaged Property on a
year-to-date basis as of the end of each month for such period as requested by
Lender, which statement shall be delivered within thirty (30) days after the end
of such month requested by Lender;

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(D)    a statement of real estate owned directly or indirectly by Borrower,
Affiliated Property Operator, and Guarantor for such period as requested by
Lender, which statement shall be delivered within thirty (30) days after the end
of such month requested by Lender;
(E)    a statement that identifies:
(i)    the direct owners of Borrower and Affiliated Property Operator and their
respective interests;
(ii)    the indirect owners (and any non-member managers) of Borrower that
Control Borrower or own a Restricted Ownership Interest in Borrower (excluding
any Publicly-Held Corporations or Publicly-Held Trusts or their direct or
indirect owners) and their respective interests;
(iii)    the indirect owners of Borrower that hold twenty-five percent (25%) or
more of the ownership interests in Borrower (excluding any Publicly-Held
Corporations or Publicly-Held Trusts or their direct or indirect owners) and
their respective interests;
(iv)    the indirect owners (and any non-member managers) of Affiliated Property
Operator that Control Affiliated Property Operator (excluding any Publicly-Held
Corporations or Publicly-Held Trusts or their direct or indirect owners) and
their respective interests; and
(v)    the indirect owners of Affiliated Property Operator that hold twenty-five
percent (25%) or more of the ownership interests in Affiliated Property Operator
(excluding any Publicly-Held Corporations or Publicly-Held Trusts or their
direct or indirect owners) and their respective interests;
(F)    copies of all reports relating to the services and operations of the
Mortgaged Property, including, if applicable, Medicaid cost reports and records
relating to account balances due to or from Third Party Payments; and
(G)    within ten (10) days after submission to Borrower by any Property
Operator, if any, the financial statements, reports, documents, communications,
and information delivered to Borrower by any Property Operator pursuant to a
Facility Operating Agreement, to the extent not otherwise provided under this
Master Agreement.
(c)    Audited Financials.
In the event Borrower, any Property Operator, or Guarantor receives or obtains
any audited financial statements and such financial statements are required to
be delivered to Lender under Section 8.02(b) (Items to Furnish to Lender),
Borrower shall deliver or cause to be delivered to

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Lender the audited versions of such financial statements.
(d)    Delivery of Books and Records.
If an Event of Default has occurred and is continuing, Borrower shall deliver to
Lender, upon written demand, all books and records relating to the Mortgaged
Property or its operation.
Section 8.03    Administration Matters Regarding Books and Records and Financial
Reporting.
(a)    Lender’s Right to Obtain Audited Books and Records.
Lender may require that Borrower’s, Property Operator’s (in connection with the
operation of the Mortgaged Property), books and records be audited, at
Borrower’s expense, by an independent certified public accountant selected by
Lender in order to produce or audit any statements, schedules, and reports of
Borrower, Property Operator (in connection with the operation of the Mortgaged
Property), or the Mortgaged Property required by Section 8.02 (Books and
Records; Financial Reporting – Covenants), if
(1)    Borrower fails to provide in a timely manner the statements, schedules,
and reports required by Section 8.02 (Books and Records; Financial Reporting –
Covenants) and, thereafter, Borrower or Guarantor fails to provide such
statements, schedules and reports within the cure period provided in Section
14.01(c) (Events of Default Subject to Extended Cure Period or Release);
(2)    the statements, schedules, and reports submitted to Lender pursuant to
Section 8.02 (Books and Records; Financial Reporting – Covenants) are not full,
complete, and accurate in all material respects as determined by Lender and,
thereafter, Borrower or Guarantor fails to provide such statements, schedules,
and reports within the cure period provided in Section 14.01(c) (Events of
Default Subject to Extended Cure Period or Release); or
(3)    an Event of Default has occurred and is continuing.
Notwithstanding the foregoing, the ability of Lender to require the delivery of
audited financial statements shall be limited to not more than once per
Borrower’s fiscal year so long as no Event of Default has occurred during such
fiscal year (or any event which, with the giving of written notice or the
passage of time, or both, would constitute an Event of Default has occurred and
is continuing). Borrower shall cooperate with Lender in order to satisfy the
provisions of this Section 8.03(a) (Lender’s Right to Obtain Audited Books and
Records). All related costs and expenses of Lender shall become due and payable
by Borrower within ten (10) Business Days after demand therefor.

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(b)    Credit Reports; Credit Score.
No more often than once in any twelve (12) month period, Lender is authorized to
obtain a credit report (if applicable) on each of Borrower, Affiliated Property
Operator, and Guarantor, the cost of which report shall be paid by Borrower.
Lender is authorized to obtain a Credit Score (if applicable) for Borrower,
Affiliated Property Operator, or Guarantor at any time at Lender’s expense.
ARTICLE 9    
INSURANCE
Section 9.01    Representations and Warranties.
The representations and warranties made by Borrower to Lender in this Section
9.01 (Insurance – Representations and Warranties) are made as of each Effective
Date and are true and correct except as disclosed on the Exceptions to
Representations and Warranties Schedule.
(a)    Compliance with Insurance Requirements.
Borrower is in compliance with Lender’s insurance requirements (or has obtained
a written waiver from Lender for any non-compliant coverage) and has timely paid
all premiums on all required insurance policies. With respect to each Mortgaged
Property, Borrower has delivered to Lender certificates of insurance and
duplicate original Insurance Policies currently in effect as of the date such
Mortgaged Property was added to the Collateral Pool.
(b)    Property Condition.
Except as disclosed in any property condition assessment report provided to
Lender prior to the date hereof:
(1)    No Mortgaged Property has been damaged by fire, water, wind, or other
cause of loss; or
(2)    if previously damaged, any previous damage to any Mortgaged Property has
been repaired and such Mortgaged Property has been fully restored.
Section 9.02    Covenants.
(a)    Insurance Requirements.
As required by Lender and Applicable Law, and as may be modified from time to
time, Borrower shall:
(1)    keep the Improvements insured at all times against any hazards, which
insurance shall include coverage against loss by fire and all other perils
insured by the “special causes of loss” coverage form, general boiler and
machinery coverage, business

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income coverage, and flood (if any of the Improvements are located in an area
identified by the Federal Emergency Management Agency (or any successor) as an
area having special flood hazards and to the extent flood insurance is available
in that area), and may include sinkhole insurance, mine subsidence insurance,
earthquake insurance, terrorism insurance, windstorm insurance and, if any
Mortgaged Property does not conform to applicable building, zoning, or land use
laws, ordinance and law coverage;
(2)    maintain at all times commercial general liability insurance, umbrella
liability insurance, worker’s compensation insurance, auto liability insurance,
and such other liability, errors and omissions, and fidelity insurance coverage;
and professional liability insurance covering errors and omissions for medical
malpractice, all types of abuse, and any service where healthcare is provided;
and
(3)    maintain builder’s risk and public liability insurance, and other
insurance in connection with completing the Repairs or Replacements, as
applicable.
(b)    Delivery of Policies, Renewals, Notices, and Proceeds.
Borrower shall:
(1)    cause all insurance policies (including any policies not otherwise
required by Lender) which can be endorsed with standard non-contributing,
non-reporting mortgagee clauses making loss payable to Lender (or Lender’s
assigns) to be so endorsed;
(2)    promptly deliver to Lender a copy of all renewal and other notices
received by Borrower with respect to the policies and all receipts for paid
premiums;
(3)    deliver evidence, in form and content acceptable to Lender, that each
Insurance Policy under this Article 9 (Insurance) has been renewed not less than
fifteen (15) days prior to the applicable expiration date, and (if such evidence
is other than an original or duplicate original of a renewal policy) deliver the
original or duplicate original of each renewal policy (or such other evidence of
insurance as may be required by or acceptable to Lender) in form and content
acceptable to Lender within ninety (90) days after the applicable expiration
date of the original Insurance Policy;
(4)    provide immediate written notice to the insurance company and to Lender
of any event of loss;
(5)    execute such further evidence of assignment of any insurance proceeds as
Lender may require; and
(6)    provide immediate written notice to Lender of Borrower’s or Property
Operator’s receipt of any insurance proceeds under any Insurance Policy required
by Section 9.02(a)(1) (Insurance Requirements) above and, if requested by
Lender, deliver to

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Lender all of such proceeds received by Borrower or Property Operator to be
applied by Lender in accordance with this Article 9 (Insurance).
Section 9.03    Administration Matters Regarding Insurance.
(a)    Lender’s Ongoing Insurance Requirements.
Borrower acknowledges that Lender’s insurance requirements may change from time
to time. All insurance policies and renewals of insurance policies required by
this Master Agreement shall be:
(1)    in the form and with the terms required by Lender;
(2)    in such amounts, with such maximum deductibles and for such periods
required by Lender; and
(3)    issued by insurance companies satisfactory to Lender.
BORROWER ACKNOWLEDGES THAT ANY FAILURE OF BORROWER TO COMPLY WITH THE
REQUIREMENTS SET FORTH IN Section 9.02(a) (Insurance Requirements) OR Section
9.02(b)(3) (Delivery of Policies, Renewals, Notices, and Proceeds) ABOVE SHALL
PERMIT LENDER TO PURCHASE THE APPLICABLE INSURANCE AT BORROWER’S COST. SUCH
INSURANCE MAY, BUT NEED NOT, PROTECT BORROWER’S INTERESTS. THE COVERAGE THAT
LENDER PURCHASES MAY NOT PAY ANY CLAIM THAT BORROWER MAKES OR ANY CLAIM THAT IS
MADE AGAINST BORROWER IN CONNECTION WITH ANY MORTGAGED PROPERTY. IF LENDER
PURCHASES INSURANCE FOR ANY MORTGAGED PROPERTY AS PERMITTED HEREUNDER, BORROWER
WILL BE RESPONSIBLE FOR THE COSTS OF THAT INSURANCE, INCLUDING INTEREST AT THE
DEFAULT RATE AND ANY OTHER CHARGES LENDER MAY IMPOSE IN CONNECTION WITH THE
PLACEMENT OF THE INSURANCE UNTIL THE EFFECTIVE DATE OF THE CANCELLATION OR THE
EXPIRATION OF THE INSURANCE. THE COSTS OF THE INSURANCE SHALL BE ADDED TO
BORROWER’S TOTAL OUTSTANDING BALANCE OR OBLIGATION AND SHALL CONSTITUTE
ADDITIONAL INDEBTEDNESS. THE COSTS OF THE INSURANCE MAY BE MORE THAN THE COST OF
INSURANCE BORROWER MAY BE ABLE TO OBTAIN ON ITS OWN. BORROWER MAY LATER CANCEL
ANY INSURANCE PURCHASED BY LENDER, BUT ONLY AFTER PROVIDING EVIDENCE THAT
BORROWER HAS OBTAINED INSURANCE AS REQUIRED BY THIS MASTER AGREEMENT AND THE
OTHER LOAN DOCUMENTS.
(b)    Application of Proceeds on Event of Loss.
(1)    Upon an event of loss, Lender may, at Lender’s option:

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(A)    hold such proceeds to be applied to reimburse Borrower for the cost of
Restoration (in accordance with Lender’s then-current policies relating to the
restoration of casualty damage on similar multifamily residential properties);
or
(B)    apply such proceeds to the payment of the Indebtedness, whether or not
then due; provided, however, Lender shall not apply insurance proceeds to the
payment of the Indebtedness and shall require Restoration pursuant to Section
9.03(b)(1)(A) (Application of Proceeds on Event of Loss) if all of the following
conditions are met:
(i)    no Potential Event of Default or Event of Default has occurred and is
continuing;
(ii)    Lender determines that the combination of insurance proceeds and amounts
provided by Borrower will be sufficient funds to complete the Restoration;
(iii)    Lender determines that after completion of the Restoration (1) the Net
Operating Income from the applicable Mortgaged Property will be sufficient to
support the Debt Service Coverage Ratio set forth in the definition of
Individual Property Coverage and LTV Tests (on a pro forma basis), and (2) the
Loan to Value Ratio of such Mortgaged Property will be no greater than the Loan
to Value Ratio immediately prior to the event of loss, but in no event greater
than ninety percent (90%);
(iv)    Lender determines that the Restoration will be completed before the
earlier of (1) one year before the latest Maturity Date of any Advance
Outstanding, or (2) one year after the date of the loss or casualty; and
(v)    Borrower provides Lender, upon written request, evidence of the
availability during and after the Restoration of the insurance required to be
maintained pursuant to this Master Agreement.
After the completion of Restoration in accordance with the above requirements,
as determined by Lender, the balance, if any, of such proceeds shall be returned
to Borrower.
(2)    Notwithstanding the foregoing, if any loss is estimated to be in an
amount equal to or less than $100,000, Lender shall not exercise its rights and
remedies as power-of-attorney herein and shall allow Borrower to make proof of
loss, to adjust and compromise any claims under policies of property damage
insurance, to appear in and prosecute any action arising from such policies of
property damage insurance, and to collect and receive the proceeds of property
damage insurance; provided that each of the following conditions shall be
satisfied:

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(A)    Borrower shall immediately notify Lender of the casualty giving rise to
the claim;
(B)    no Potential Event of Default or Event of Default has occurred and is
continuing;
(C)    the Restoration will be completed before the earlier of (i) one year
before the Termination Date, or (ii) one year after the date of the loss or
casualty;
(D)    Lender determines that the combination of insurance proceeds and amounts
provided by Borrower will be sufficient funds to complete the Restoration;
(E)    all proceeds of property damage insurance shall be issued in the form of
joint checks to Borrower and Lender;
(F)    all proceeds of property damage insurance shall be applied to the
Restoration;
(G)    Borrower shall deliver to Lender evidence satisfactory to Lender of
completion of the Restoration and obtainment of all lien releases;
(H)    Borrower shall have complied to Lender’s satisfaction with the foregoing
requirements on any prior claims subject to this provision, if any; and
(I)    Lender shall have the right to inspect the applicable Mortgaged Property
(subject to the rights of tenants under the Leases, other than the Seniors
Housing Facility Lease).
(3)    If Lender elects to apply insurance proceeds to the Indebtedness in
accordance with the terms of this Master Agreement, Borrower shall not be
obligated to restore or repair the applicable Mortgaged Property. Rather,
Borrower shall restrict access to the damaged portion of such Mortgaged Property
and, at its expense and regardless of whether such costs are covered by
insurance, clean up any debris resulting from the casualty event, and, if
required or otherwise permitted by Lender, demolish or raze any remaining part
of the damaged Mortgaged Property to the extent necessary to keep and maintain
the Mortgaged Property in a safe, habitable and marketable condition. Nothing in
this Section 9.03(b) (Application of Proceeds on Event of Loss) shall affect any
of Lender’s remedial rights against Borrower in connection with a breach by
Borrower of any of its obligations under this Master Agreement or under any Loan
Document, including any failure to timely pay Monthly Debt Service Payments or
maintain the insurance coverage(s) required by this Master Agreement.
(c)    Payment Obligations Unaffected.
The application of any insurance proceeds to the Indebtedness shall not extend
or postpone

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the Maturity Date, or the due date or the full payment of any Monthly Debt
Service Payment, Monthly Replacement Reserve Deposit, or any other installments
referred to in this Master Agreement or in any other Loan Document.
Notwithstanding the foregoing, if Lender applies insurance proceeds to the
Indebtedness in connection with a casualty of less than an entire Mortgaged
Property, then Lender shall permit an adjustment to the Monthly Debt Service
Payments that become due and owing thereafter, based on the Underwriting and
Servicing Requirements.
(d)    Foreclosure Sale.
If a Mortgaged Property is transferred pursuant to a Foreclosure Event or Lender
otherwise acquires title to a Mortgaged Property, Borrower acknowledges that
Lender shall automatically succeed to all rights of Borrower in and to any
insurance policies and unearned insurance premiums applicable to such Mortgaged
Property and in and to the proceeds resulting from any damage to such Mortgaged
Property prior to such Foreclosure Event or such acquisition.
(e)    Appointment of Lender as Attorney-In-Fact.
Borrower hereby authorizes and appoints Lender as attorney-in-fact pursuant to
Section 14.03(c) (Appointment of Lender as Attorney-In-Fact).
ARTICLE 10    
CONDEMNATION
Section 10.01    Representations and Warranties.
The representations and warranties made by Borrower to Lender in this Section
10.01 (Condemnation – Representations and Warranties) are made as of each
Effective Date and are true and correct except as disclosed on the Exceptions to
Representations and Warranties Schedule.
(a)    Prior Condemnation Action.
No part of any Mortgaged Property has been taken in connection with a
Condemnation Action.
(b)    Pending Condemnation Actions.
Except with respect to a Release Mortgaged Property that is the subject of a
Release Request, no Condemnation Action is pending nor, to Borrower’s knowledge,
is threatened for the partial or total condemnation or taking of any Mortgaged
Property.
Section 10.02    Covenants.
(a)    Notice of Condemnation.
Borrower shall:

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(1)    promptly notify Lender of any Condemnation Action of which Borrower has
knowledge;
(2)    subject to Section 10.03(c) appear in and prosecute or defend, at its own
cost and expense, any action or proceeding relating to any Condemnation Action,
including any defense of Lender’s interest in any Mortgaged Property tendered to
Borrower by Lender, unless otherwise directed by Lender in writing; and
(3)    execute such further evidence of assignment of any condemnation award in
connection with a Condemnation Action as Lender may require.
(b)    Condemnation Proceeds.
Borrower shall pay to Lender all awards or proceeds of a Condemnation Action
promptly upon receipt.
Section 10.03    Administration Matters Regarding Condemnation.
(a)    Application of Condemnation Awards.
Lender may apply any awards or proceeds of a Condemnation Action, after the
deduction of Lender’s expenses incurred in the collection of such amounts, to:
(1)    the restoration or repair of the applicable Mortgaged Property, if
applicable;
(2)    the payment of the Indebtedness, with the balance, if any, paid to
Borrower; or
(3)    Borrower.
(b)    Payment Obligations Unaffected.
The application of any awards or proceeds of a Condemnation Action to the
Indebtedness shall not extend or postpone any Maturity Date, or the due date or
the full payment of any Monthly Debt Service Payment, Monthly Replacement
Reserve Deposit, or any other installments referred to in this Master Agreement
or in any other Loan Document.
(c)    Appointment of Lender as Attorney-In-Fact.
(1)    Borrower hereby authorizes and appoints Lender as attorney-in-fact
pursuant to Section 14.03(c) (Appointment of Lender as Attorney-In-Fact).
(2)    Notwithstanding anything to the contrary herein, Borrower may itself
appear in, prosecute or defend any action or proceeding relating to any
Condemnation Action and settle or compromise any claim and collect and receive
the proceeds of the award therefrom aggregating not in excess of $10,000
(provided Borrower applies such

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proceeds to restoration or repair of the applicable Mortgaged Property, if
applicable), and may itself appear in, prosecute or defend any action or
proceeding relating to any Condemnation Action and settle and compromise any
claim aggregating not in excess of $50,000 but may not collect and receive the
award therefrom, the same having been assigned to Lender hereunder.
(d)    Preservation of Mortgaged Property.
If a Condemnation Action results in or from damage to any Mortgaged Property and
Lender elects to apply the proceeds or awards from such Condemnation Action to
the Indebtedness in accordance with the terms of this Master Agreement, Borrower
shall not be obligated to restore or repair such Mortgaged Property. Rather,
Borrower shall restrict access to any portion of the Mortgaged Property which
has been damaged or destroyed in connection with such Condemnation Action and,
at Borrower’s expense and regardless of whether such costs are covered by
insurance, clean up any debris resulting in or from the Condemnation Action,
and, if required by any Governmental Authority or otherwise permitted by Lender,
demolish or raze any remaining part of the damaged Mortgaged Property to the
extent necessary to keep and maintain the Mortgaged Property in a safe,
habitable, and marketable condition. Nothing in this Section 10.03(d)
(Preservation of Mortgaged Property) shall affect any of Lender’s remedial
rights against Borrower in connection with a breach by Borrower of any of its
obligations under this Master Agreement or under any Loan Document, including
any failure to timely pay Monthly Debt Service Payments or maintain the
insurance coverage(s) required by this Master Agreement.
ARTICLE 11    
LIENS, TRANSFERS, AND ASSUMPTIONS
Section 11.01    Representations and Warranties.
The representations and warranties made by Borrower to Lender in this Section
11.01 (Liens, Transfers, and Assumptions – Representations and Warranties) are
made as of each Effective Date and are true and correct except as disclosed on
the Exceptions to Representations and Warranties Schedule.
(a)    No Labor or Materialmen’s Claims.
All parties furnishing labor and materials on behalf of Borrower or on behalf of
Property Operator with respect to the Mortgaged Property have been paid in full
prior to delinquency; provided that Borrower or Property Operator may contest
amounts claimed by such parties to be owed, pursuant to Section 11.02(a) (Liens;
Encumbrances). There are no mechanics’ or materialmen’s liens (whether filed or,
to the best of Borrower’s knowledge after due inquiry, unfiled, for outstanding
work, labor, or materials (and no claims or work outstanding that under
Applicable Law could give rise to any such mechanics’ or materialmen’s liens
affecting any Mortgaged Property, whether prior to, equal with, or subordinate
to the lien of the Security Instrument.

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(b)    No Other Interests.
No Person:
(1)    other than Borrower has any possessory ownership or interest in any
Mortgaged Property or right to occupy the same except under and pursuant to the
provisions of the Facility Operating Agreement and the other existing Leases,
the material terms of all such Leases having been previously disclosed in
writing to Lender; nor
(2)    has an option, right of first refusal, or right of first offer (except as
required by Applicable Law) to purchase any Mortgaged Property, or any interest
in any Mortgaged Property.
Section 11.02    Covenants.
(a)    Liens; Encumbrances.
Borrower shall not permit the grant, creation, or existence of any Lien, whether
voluntary, involuntary, or by operation of law, on all or any portion of any
Mortgaged Property (including any voluntary, elective, or non-compulsory tax
lien or assessment pursuant to a voluntary, elective, or non-compulsory special
tax district or similar regime) other than:
(1)    Permitted Encumbrances;
(2)    the creation of:
(A)    any tax lien, municipal lien, utility lien, mechanics’ lien,
materialmen’s lien, or judgment lien against any Mortgaged Property if bonded
off, released of record, or otherwise remedied to Lender’s satisfaction within
sixty (60) days after the earlier of the date Borrower or Property Operator has
actual notice or constructive notice of the existence of such lien; or
(B)    any mechanics’ or materialmen’s liens which attach automatically under
the laws of any Governmental Authority upon the commencement of any work upon,
or delivery of any materials to, any Mortgaged Property and for which Borrower
or Property Operator is not delinquent in the payment for any such work or
materials; and
(3)    the lien created by, or (in connection with Permitted Equipment
Financing) permitted under, the Loan Documents.
Notwithstanding the foregoing, nothing herein shall require Borrower to pay any
Lien so long as Borrower in good faith and at its own expense and by proper
legal proceedings is diligently contesting the validity, amount or application
of such Lien and at the time of commencement of the proceeding and during the
pendency thereof (i) the Mortgaged Property will not be in material danger of
being sold, forfeited or lost, as determined by Lender (ii) Borrower shall
furnish such

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security as may be required in such proceeding or as may be requested by Lender
to insure the payment of the amounts contested (after taking into account any
reserves held by Lender for such purpose); and (iii) such contest operates to
suspend collection or enforcement of the contested amount, as applicable.
(b)    Transfers.
(1)    Mortgaged Property.
A Transfer as described in clause (b) of the definition of Transfer of all or
any part of any Mortgaged Property (including any interest in any Mortgaged
Property) shall not occur other than:
(A)    a Transfer to which Lender has consented in writing;
(B)    the grant of a Residential Lease for a term of not less than one (1)
month and not more than two (2) years, and not containing an option to purchase
or right of first refusal (except as required by Applicable Law);
(C)    Leases permitted pursuant to the Loan Documents, including the Seniors
Housing Facility Lease between Borrower and Property Operator and the
subordination thereof to the terms, provisions, and lien of this Master
Agreement, the Security Instrument, and the other Loan Documents;
(D)    the grant of a non-Material Commercial Lease provided the use and type of
operation of such space is not materially altered from the use and type of
operation in effect as of the Effective Date and the number and size of
residential units at any Mortgaged Property are not reduced or the grant of a
non-Material Commercial Lease entered into pursuant to a unit conversion
permitted pursuant to the last paragraph of Section 6.02(a) or Section 6.02(f);
(E)    a Transfer of obsolete or worn out Personalty or Fixtures that are
contemporaneously replaced by items of equal or better function and quality
which are free of Liens (other than liens securing indebtedness permitted under
clause (i) of the definition of Permitted Indebtedness and liens created by the
Loan Documents);
(F)    the grant of an easement, servitude, or restrictive covenant to which
Lender has consented, and Borrower has paid to Lender, upon demand, all costs
and expenses incurred by Lender in connection with reviewing Borrower’s request;
(G)    a lien permitted pursuant to Section 11.02 (Liens, Transfers, and
Assumptions – Covenants) of this Master Agreement; or
(H)    the conveyance of any Mortgaged Property following a Foreclosure Event.

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Lender shall not unreasonably withhold its consent to or withhold its agreement
to subordinate the lien of the applicable Security Instrument to (1) the grant
of a utility easement serving such Mortgaged Property to a publicly operated
utility, or (2) the grant of an easement related to expansion or widening of
roadways, provided that any such easement is in form and substance reasonably
acceptable to Lender and does not materially and adversely affect the lien of
the Security Instrument or the access, use or marketability of such Mortgaged
Property.
(2)    No Transfers of Interests in Borrower, Key Principal, Guarantor or
Affiliated Property Operator.
Subject to the provisions of this Article 11 (Liens, Transfers, and
Assumptions), a Transfer as described in clause (a) of the definition of
Transfer, a Change of Control, or a Transfer of the Restricted Ownership
Interest shall not occur.
Notwithstanding the restrictions on Control and Restricted Ownership Interests,
to the extent a Restricted Ownership Interest is held by a Publicly-Held
Corporation or a Publicly-Held Trust, a Transfer of any ownership interests in
such Publicly-Held Corporation or Publicly-Held Trust shall not be prohibited
under this Master Agreement as long as (1) such Transfer does not result in a
conversion of such Publicly-Held Corporation or Publicly-Held Trust to a
privately held entity, and (2) Borrower provides written notice to Lender not
later than thirty (30) days thereafter of any such Transfer that results in any
Person owning ten percent (10%) or more of the ownership interests in such
Publicly-Held Corporation or Publicly-Held Trust.
(3)    Name Change or Entity Conversion.
Lender shall consent to a Borrower, Borrower Entity, Affiliated Property
Operator or an Identified Party changing its name, changing its jurisdiction of
organization, or converting from one type of legal entity into another type of
legal entity for any lawful purpose, provided that:
(A)    Lender receives written notice at least thirty (30) days prior to such
change or conversion, which notice shall include organizational charts that
reflect the structure of such Borrower both prior to and subsequent to such name
change or entity conversion;
(B)    such Transfer is not otherwise prohibited under the provisions of Section
11.02(b)(2) (No Transfers of Interests in Borrower, Key Principal, Guarantor, or
Affiliated Property Operator);
(C)    the applicable entity executes an amendment to this Master Agreement and
any other Loan Documents required by Lender documenting the name change or
entity conversion;
(D)    Borrower agrees and acknowledges, at Borrower’s expense, that (i) the
applicable entity will execute and record in the land records any instrument
required by the Property Jurisdiction to be recorded to evidence such name
change

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or entity conversion (or provide Lender with written confirmation from the title
company (via electronic mail or letter) that no such instrument is required),
(ii) the applicable entity will execute any additional documents required by
Lender, including the amendment to this Master Agreement, and, if applicable, an
amendment to the Facility Operating Agreement, and, if applicable, allow such
documents to be recorded or filed in the land records of the Property
Jurisdiction, (iii) Lender will obtain a “date down” endorsement to the Lender’s
Title Policy (or obtain a new Title Policy if a “date down” endorsement is not
available in the Property Jurisdiction), evidencing title to the Mortgaged
Property being in the name of the successor entity and the Lien of the Security
Instrument against the Mortgaged Property, and (iv) Lender will file any
required UCC-3 financing statement and make any other filing deemed necessary to
maintain the priority of its Liens on the Mortgaged Property;
(E)    no later than ten (10) days subsequent to such name change or entity
conversion, Borrower shall provide Lender (i) the documentation filed with the
appropriate office in the applicable entity’s state of formation evidencing such
name change or entity conversion, (ii) copies of the organizational documents of
the applicable entity, including any amendments, filed with the appropriate
office in the applicable entity’s state of formation reflecting the
post-conversion name of the applicable entity, form of organization, and
structure, and (iii) if available, new certificates of good standing or valid
formation for the applicable entity; and
(F)    Borrower shall provide Lender with confirmation that any Licenses in
Borrower’s or Affiliated Property Operator’s name remain valid and in full force
and effect following the name change or entity conversion or have been properly
transferred to Borrower or Affiliated Property Operator following such name
change or entity conversion.
If the conditions set forth in this Section 11.02(b)(3) (Name Change or Entity
Conversion) are satisfied, the Transfer Fee shall be waived provided Borrower
shall pay the Review Fee in the amount of $3,000 (for each request made at the
same time) and out-of-pocket costs set forth in Section 11.03(g) (Further
Conditions on Transfers Requiring Lender’s Consent).
Borrower shall provide Lender prompt notice of any name change or entity
conversation of any other Borrower Entity, Affiliated Property Operator, or
Identified Party.
(4)    No Delaware Statutory Trust or Series LLC Conversion.
Notwithstanding any provisions herein to the contrary, no Borrower Entity shall
convert to a Delaware Statutory Trust or a series limited liability company.
Notwithstanding the foregoing, Borrower shall provide Lender prompt notice of
any name change or entity conversion of any other Borrower Entity, Affiliated
Property Operator, or Identified Party.

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(c)    Facility Operating Agreement.
Subject to the provisions of this Article 11 (Liens, Transfers, and
Assumptions), Borrower shall not:
(1)    Transfer its rights or interests in the Facility Operating Agreement, or
Transfer the responsibility for the operation and management of the Mortgaged
Property, from Property Operator to any other Person except as specifically
provided for in the Master Agreement;
(2)    permit Affiliated Property Operator to Transfer its interest in the
Facility Operating Agreement;
(3)    remove, permit, or suffer the removal of Affiliated Property Operator
from the Facility Operating Agreement;
(4)    surrender or accept a surrender of the Facility Operating Agreement;
(5)    cancel or terminate the Facility Operating Agreement; or
(6)    permit a merger of Borrower’s fee interest estate in the Mortgaged
Property with Property Operator’s leasehold interest in the Mortgaged Property,
if any.
Borrower agrees, and the Facility Operating Agreement shall provide, that Lender
shall have the right to terminate the Facility Operating Agreement at any time
upon the occurrence and continuance of an Event of Default.
(d)    No Other Indebtedness.
Other than the Advances and Permitted Indebtedness Borrower shall not incur or
be obligated at any time with respect to any loan or other indebtedness (except
trade payables as otherwise permitted in this Master Agreement), including any
indebtedness secured by a Lien on, or the cash flows from, the Mortgaged
Property.
(e)    No Mezzanine Financing or Preferred Equity.
Neither Borrower, any Affiliated Property Operator, nor any direct or indirect
owner of Borrower or any Affiliated Property Operator shall: (1) incur any
Mezzanine Debt other than Permitted Mezzanine Debt; (2) issue any Preferred
Equity other than Permitted Preferred Equity; or (3) incur any similar
indebtedness or issue any similar equity.
Section 11.03    Administration Matters Regarding Liens, Transfers, and
Assumptions.
(a)    Transfer of Collateral Pool.
Lender shall consent to a Transfer of the entire Collateral Pool to and an
assumption of the

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Loan Documents by a new borrower if each of the following conditions is
satisfied prior to the Transfer:
(1)    Borrower has submitted to Lender all information required by Lender to
make the determination required by this Section 11.03(a) (Transfer of Collateral
Pool);
(2)    no Event of Default has occurred and is continuing, and no Potential
Event of Default has occurred and is continuing;
(3)    Lender determines that:
(A)    the proposed new borrower, new key principal, and any other new guarantor
fully satisfy all of Lender’s then-applicable borrower, key principal, or
guarantor eligibility, credit, management, and other loan underwriting
standards, which shall include an analysis of (i) the previous relationships
between Lender and the proposed new borrower, new key principal, new guarantor,
and any Person in Control of them, and the organization of the new borrower, new
key principal, and new guarantor (if applicable), and (ii) the operating and
financial performance of the Mortgaged Property, including physical condition
and occupancy;
(B)    any proposed new borrower and its sole or managing member, manager, or
general partner, as applicable, is a Single Purpose entity;
(C)    none of the proposed new borrower, new key principal, and any new
guarantor, or any owners of the proposed new borrower, new key principal, and
any new guarantor, are a Prohibited Person; and
(D)    none of the proposed new borrower, new key principal, and any new
guarantor (if any of such are entities) shall have an organizational existence
termination date that ends before the Termination Date;
(4)    [reserved];
(5)    the proposed new borrower has:
(A)    executed an assumption agreement acceptable to Lender that, among other
things, requires the proposed new borrower to assume and perform all obligations
of Borrower (or any other transferor), and that may require that the new
borrower comply with any provisions of any Loan Document which previously may
have been waived by Lender for Borrower, subject to the terms of Section
11.03(g) (Further Conditions on Transfers Requiring Lender’s Consent);
(B)    if required by Lender, delivered to the Title Company for filing or
recording in all applicable jurisdictions, all applicable Loan Documents
including the assumption agreement to correctly evidence the assumption and the

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confirmation, continuation, perfection, and priority of the Liens created
hereunder and under the other Loan Documents; and
(C)    delivered to Lender a “date-down” endorsement to the Title Policy
acceptable to Lender (or a new title insurance policy if a “date-down”
endorsement is not available);
(6)    one or more individuals or entities acceptable to Lender as new
guarantors have executed and delivered to Lender:
(A)    an assumption agreement acceptable to Lender that requires the new
guarantor to assume and perform all obligations of Guarantor under any Guaranty
given in connection with the Loan Documents; or
(B)    a substitute Non-Recourse Guaranty and other substitute guaranty in a
form acceptable to Lender;
(7)    Lender has reviewed and approved the Transfer documents;
(8)    There shall be no change in the servicer as a result of the Transfer;
(9)    Borrower has satisfied the applicable provision of Section 11.03(g)
(Further Conditions on Transfers Requiring Lender’s Consent) including Lender’s
receipt of the fees described in Section 11.03(g) (Further Conditions on
Transfers Requiring Lender’s Consent);
(10)    if any MBS is Outstanding, the Transfer shall not result in a
“significant modification,” as defined under applicable Treasury Regulations, of
any Advance that has been securitized in an MBS; and
(11)    Borrower and Property Operator have executed a new SASA required by
Lender.
(b)    Permitted Transfers of Ownership Interests
Notwithstanding the provisions of Section 11.02(b)(2) (No Transfers of Interests
in Borrower, Key Principal, Guarantor, or Affiliated Property Operator) and
Section 11.02(b)(3)(A) (Entity Conversion), the following Transfers are
permitted without the consent of Lender (“Permitted Transfers”):
(1)    a Transfer of any (a) indirect Ownership Interest in Borrower or
Affiliate Property Operator or any Identified Party, (b) direct or indirect
Ownership Interest in Guarantor, Key Principal, or any Identified Party;
provided, however, that no Change of Control and no Transfer of the Restricted
Ownership Interest occurs as the result of such Transfer;

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(2)    the issuance by Borrower, Guarantor, Key Principal, Affiliated Property
Operator, or any Identified Party of additional membership interests,
partnership interests, or stock (including by creation of a new class or series
of interests or stock), as the case may be, and the subsequent direct or
indirect Transfer of such interests or stock; provided, however, that no Change
of Control and no Transfer of the Restricted Ownership Interest occurs as the
result of such Transfer;
(3)    The following Transfers (each, a “Public Transfer”):
(i)    the Transfer of indirect interests in Borrower and Guarantor, through one
or a series of transactions, to an Offering Vehicle or its Operating Company in
contemplation of a Public Listing provided that the Public Transfer Conditions
are satisfied;
(ii)    a Public Listing of an Offering Vehicle as contemplated by clause (i)
above or as initial matter, provided that the Public Transfer Conditions are
satisfied;
(iii)    upon or following a Public Listing of an Offering Vehicle, the Transfer
of direct non-public, non-managing interests or limited partnership interests in
its Operating Company; and
(iv)    upon or following a Public Listing of the Public Vehicle, the Transfer
of publically traded stock or interests in such Public Vehicle.
(4)    Transfers that result in a change of Control or Transfer of the
Restricted Ownership if such Transfer is to a Qualified Transferee provided that
the Qualified Transfer Conditions are satisfied.
(5)    a merger with or acquisition of another entity by Key Principal or
Guarantor, as applicable, provided that (A) such Key Principal or Guarantor, as
applicable, is the surviving entity after such merger or acquisition, (B) no
Change of Control or Transfer of the Restricted Ownership Interest occurs, and
(C) such merger or acquisition does not result in an Event of Default;
(6)    a Transfer of any direct Ownership Interest in Borrower or Affiliated
Property Operator to a subsidiary of Guarantor or Key Principal, provided that
no Change of Control or Transfer of the Restricted Ownership Interest occurs;
and
(7)    any conversion of Key Principal or Guarantor from one type of entity to
another type of entity or any amendment, modification, or any other change in
the governing instrument or instruments of Key Principal or Guarantor; provided,
however, that
(A)    no Change of Control occurs as a result of any such Transfer;

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(B)    the decision-making powers and rights of the board of directors of Key
Principal and the board of directors of Guarantor are not eliminated, materially
impaired, or materially reduced as a result of such Transfer (provided, however,
that the creation of new committees of the board of directors of Key Principal
or the board of directors of Guarantor that are delegated certain powers and
authority of the board of directors of Key Principal or the board of directors
of Guarantor (as applicable) will not be deemed to be an elimination, material
impairment, or material reduction of the decision-making powers of the board of
directors of Key Principal or the board of directors of Guarantor, so long as
the board of directors of Key Principal or the board of directors of Guarantor,
as applicable, Controls the composition of any such committee and has the right
to rescind any such delegation); and
(C)    the board of directors of Key Principal and the board of directors of
Guarantor continue to exist and Control the Key Principal or Guarantor, as
applicable.
If the conditions set forth in this Section 11.03(b) (Permitted Transfers of
Ownership Interests) are satisfied, the Transfer Fee shall be waived provided
Borrower shall pay the Review Fee and out-of-pocket costs set forth in Section
11.03(g) (Further Conditions on Transfers Requiring Lender’s Consent).
Notwithstanding the foregoing, no Review Fee shall be due in connection with a
Permitted Transfer that consists solely of (i) the issuance or trading of
publicly-traded Ownership Interests of Guarantor, or (ii) the creation of new
committees of the board of directors of Key Principal or the board of directors
of Guarantor that are delegated certain powers and authority of the board of
directors of Key Principal or the board of directors of Guarantor (as
applicable), so long as the board of directors of Key Principal or the board of
directors of Guarantor, as applicable, controls the composition of any such
committee and has the right to rescind any such delegation.
(c)    Estate Planning.
Notwithstanding the provisions of 11.02(b)(2) (No Transfers of Interests in
Borrower, Key Principal, or Guarantor), so long as the (1) Transfer does not
cause a Change of Control and (2) Key Principal and Guarantor, as applicable,
maintain the same right and ability to Control Borrower as existed prior to the
Transfer, Lender shall consent to Transfers of direct or indirect Ownership
Interests in Borrower or Affiliated Property Operator, and Transfers of direct
or indirect Ownership Interests, in an entity Key Principal or entity Guarantor
to:
(A)    Immediate Family Members of such transferor each of whom must have
obtained the legal age of majority;
(B)    United States domiciled trusts established for the benefit of the
transferor or Immediate Family Members of the transferor; or
(C)    partnerships or limited liability companies of which the partners or
members, respectively, are comprised entirely of (i) such transferor and
Immediate

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Family Members (each of whom must have obtained the legal age of majority) of
such transferor, (ii) all Immediate Family Members (each of whom must have
obtained the legal age of majority) of such transferor, or (iii) United States
domiciled trusts established for the benefit of the transferor, or Immediate
Family Members of the transferor.
If the conditions set forth in this Section 11.03(c) (Estate Planning) are
satisfied, the Transfer Fee shall be waived provided Borrower shall pay the
Review Fee and out-of-pocket costs set forth in Section 11.03(g) (Further
Conditions on Transfers Requiring Lender’s Consent).
(d)    Termination or Revocation of Trust.
If any of Borrower, Affiliated Property Operator, Guarantor, or Key Principal is
a trust (other than a REIT), or if a Restricted Ownership Interest would be
violated, or if Control of Borrower, Affiliated Property Operator, Guarantor, or
Key Principal would be Transferred due to the termination or revocation of a
trust, the termination or revocation of such trust is an unpermitted Transfer;
provided that the termination or revocation of the trust due to the death of an
individual trustor shall not be considered an unpermitted Transfer so long as:
(1)    Lender is notified within thirty (30) days of the death; and
(2)    such Borrower, Affiliated Property Operator, Guarantor, Key Principal, or
other Person, as applicable, is replaced with an individual or entity acceptable
to Lender, in accordance with the provisions of Section 11.03(a) (Transfer of
Collateral Pool) within ninety (90) days of the date of the death causing the
termination or revocation.
If the conditions set forth in this Section 11.03(d) (Termination or Revocation
of Trust) are satisfied, the Transfer Fee shall be waived; provided Borrower
shall pay the Review Fee and out-of-pocket costs set forth in Section 11.03(g)
(Further Conditions on Transfers Requiring Lender’s Consent).
(e)    Death of Key Principal or Guarantor; Restricted Ownership
Interest/Controlling Interest Transfer Due to Death.
(1)    If a Key Principal or Guarantor that is a natural person dies, or if a
Transfer of the Restricted Ownership Interest or a Change of Control occurs as a
result of the death of a Person (except in the case of trusts which is addressed
in Section 11.03(d) (Termination or Revocation of Trust)), Borrower must notify
Lender in writing within ninety (90) days in the event of such death. Unless
waived in writing by Lender, the deceased shall be replaced by an individual or
entity within one hundred eighty (180) days, subject to Borrower’s satisfaction
of the following conditions:
(A)    Borrower has submitted to Lender all information required by Lender to
make the determination required by this Section 11.03(e) (Death of Key

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Principal or Guarantor; Restricted Ownership Interest/Controlling Interest
Transfer Due to Death);
(B)    Lender determines that, is applicable:
(i)    any proposed new key principal and any other new guarantor (or Person
Controlling such new key principal or new guarantor) fully satisfies all of
Lender’s then-applicable key principal or guarantor eligibility, credit,
management, and other loan underwriting standards (including any standards with
respect to previous relationships between Lender and the proposed new key
principal and new guarantor (or Person Controlling such new key principal or new
guarantor) and the organization of the new key principal and new guarantor);
(ii)    none of any proposed new key principal or any new guarantor, or any
owners of the proposed new key principal or any new guarantor, is a Prohibited
Person; and
(iii)    none of any proposed new key principal or any new guarantor (if any of
such are entities) shall have an organizational existence termination date that
ends before the Maturity Date; and
(C)    if applicable, one or more individuals or entities acceptable to Lender
as new guarantors have executed and delivered to Lender:
(i)    an assumption agreement acceptable to Lender that requires the new
guarantor to assume and perform all obligations of Guarantor under any Guaranty
given in connection with this Master Agreement; or
(ii)    a substitute Non-Recourse Guaranty and other substitute guaranty in a
form acceptable to Lender.
(2)    In the event a replacement Key Principal, Guarantor, or other Person is
required by Lender due to the death described in this Section 11.03(e) (Death of
Key Principal or Guarantor; Restricted Ownership Interest/Controlling Interest
Transfer Due to Death), and such replacement has not occurred within such
period, the period for replacement may be extended by Lender to a date not more
than one year from the date of such death; however, Lender may require as a
condition to any such extension that:
(A)    the then-current Property Operator be replaced with a property operator
reasonably acceptable to Lender (or if a Property Operator has not been
previously engaged, a property operator reasonably acceptable to Lender be
engaged); or

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(B)    a lockbox agreement or similar cash management arrangement (with Property
Operator) reasonably acceptable to Lender during such extended replacement
period be instituted.
If the conditions set forth in this Section 11.03(e) (Death of Key Principal or
Guarantor; Restricted Ownership Interest/Controlling Interest Transfer Due to
Death) are satisfied, the Transfer Fee shall be waived, provided Borrower shall
pay the Review Fee and out-of-pocket costs set forth in Section 11.03(g)
(Further Conditions on Transfers Requiring Lender’s Consent).
(f)    Intentionally Deleted.
(g)    Further Conditions on Transfers Requiring Lender’s Consent.
(1)    In connection with any Transfer for which Lender’s approval is required
under this Master Agreement including any Transfer under Section 11.02(b)(1)(A)
(Liens, Transfers, and Assumptions – Covenants – Transfers – Mortgaged Property)
and Section 11.03(a) (Transfer of Collateral Pool), Lender may, as a condition
to any such approval, require:
(A)    additional collateral, guaranties, or other credit support to mitigate
any risks concerning the proposed transferee or the performance or condition of
any Mortgaged Property;
(B)    amendment of the Loan Documents to delete or modify any specially
negotiated terms or provisions previously granted for the exclusive benefit of
original Borrower, Affiliated Property Operator, Key Principal, or Guarantor and
to restore the original provisions of the standard Fannie Mae form multifamily
loan documents, to the extent such provisions were previously modified;
(C)    a modification to the amounts required to be deposited into the
Reserve/Escrow Account pursuant to the terms of Section 13.02(a)(3)(B)
(Adjustment of Deposits – Transfers);
(D)    in connection with any assumption of the Loan Documents, after giving
effect to the assumption, the provisions of the General Conditions Schedule
shall be satisfied;
(E)    delivery to the Title Company for filing or recording in all applicable
jurisdictions, all applicable Loan Documents including assumption documents and
any other appropriate documents in form and substance reasonably satisfactory to
Lender in form proper for recordation as may be necessary in the opinion of
Lender to correctly evidence the assumptions and the confirmation of Liens
created hereunder; or

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(F)    if any MBS is Outstanding, the Transfer shall not result in a
“significant modification,” as defined under applicable Treasury Regulations, of
any Advance that has been securitized in an MBS.
(2)    In connection with any request by Borrower for consent to a Transfer,
Borrower shall pay to Lender upon demand:
(A)    the Transfer Fee at the closing of such Transfer (to the extent charged
by Lender);
(B)    Review Fee (regardless of whether Lender approves or denies such
request); and
(C)    all of Lender’s out-of-pocket costs (including reasonable attorneys’
fees) incurred in reviewing the Transfer request, regardless of whether Lender
approves or denies such request.
ARTICLE 12    
IMPOSITIONS
Section 12.01    Representations and Warranties.
The representations and warranties made by Borrower to Lender in this Section
12.01 (Impositions – Representations and Warranties) are made as of each
Effective Date and are true and correct except as disclosed on the Exceptions to
Representations and Warranties Schedule.
(a)    Payment of Taxes, Assessments, and Other Charges.
Borrower has:
(1)    paid (or with the approval of Lender, established an escrow fund
sufficient to pay when due and payable) all amounts and charges relating to the
Mortgaged Properties that have become due and payable before any fine, penalty
interest, lien, or costs may be added thereto, including Impositions, leasehold
payments, and ground rents;
(2)    paid all Taxes for the Mortgaged Properties that have become due before
any fine, penalty interest, lien, or costs may be added thereto pursuant to any
notice of assessment received by Borrower and any and all taxes that have become
due against Borrower before any fine, penalty interest, lien, or costs may be
added thereto;
(3)    no knowledge of any basis for any additional assessments;
(4)    no knowledge of any presently pending special assessments against all or
any part of the Mortgaged Properties not disclosed in the Title Policies, or any
presently pending special assessments against Borrower; and

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(5)    not received any written notice of any contemplated special assessment
against any Mortgaged Property, or any contemplated special assessment against
Borrower.
Section 12.02    Covenants.
(a)    Imposition Deposits, Taxes, and Other Charges.
Borrower shall:
(1)    deposit the Imposition Deposits with Lender on each Payment Date (or on
another day designated in writing by Lender) in amount sufficient, in Lender’s
discretion, to enable Lender to pay each Imposition before the last date upon
which such payment may be made without any penalty or interest charge being
added, plus an amount equal to no more than one-sixth (1/6) (or the amount
permitted by Applicable Law) of the Impositions for the trailing twelve (12)
months (calculated based on the aggregate annual Imposition costs divided by
twelve (12) and multiplied by two (2));
(2)    deposit with Lender, within ten (10) Business Days after written notice
from Lender (subject to Applicable Law), such additional amounts estimated by
Lender to be reasonably necessary to cure any deficiency in the amount of the
Imposition Deposits held for payment of a specific Imposition;
(3)    except as set forth in Section 12.03(c) (Payment of Impositions;
Sufficiency of Imposition Deposits) below or Section 12.03(e) (Contesting
Impositions), pay all Impositions, leasehold payments, ground rents, and Taxes
when due and before any fine, penalty interest, lien, or costs may be added
thereto;
(4)    promptly deliver to Lender a copy of all notices of, and invoices for,
Impositions, and, if Borrower pays any Imposition directly, Borrower shall
promptly furnish to Lender receipts evidencing such payments and Lender shall
thereupon release any Imposition Deposits specifically reserved for the payment
of such Impositions in accordance with Lender’s standard servicing practices;
and
(5)    promptly deliver to Lender a copy of all notices of any special
assessments and contemplated special assessments against any Mortgaged Property
or Borrower.
(b)    Conditional Waiver.
Notwithstanding the above, Schedule 17 is incorporated herein.
Section 12.03    Administration Matters Regarding Impositions.
(a)    Maintenance of Records by Lender.
Lender shall maintain records of the monthly and aggregate Imposition Deposits
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Lender for the purpose of paying Taxes, insurance premiums, and each other
obligation of Borrower for which Imposition Deposits are required.
(b)    Imposition Accounts.
All Imposition Deposits shall be held in an institution (which may be Lender, if
Lender is such an institution) whose deposits or accounts are insured or
guaranteed by a federal agency and which accounts meet the standards for
custodial accounts as required by Lender from time to time. Lender shall not be
obligated to open additional accounts, or deposit Imposition Deposits in
additional institutions, when the amount of the Imposition Deposits exceeds the
maximum amount of the federal deposit insurance or guaranty. No interest,
earnings, or profits on the Imposition Deposits shall be paid to Borrower unless
Applicable Law so requires. Imposition Deposits shall not be trust funds, nor
shall they operate to reduce the Indebtedness, unless applied by Lender for that
purpose in accordance with this Master Agreement. For the purposes of
§9-104(a)(3) of the UCC, Lender is the owner of the Imposition Deposits and
shall be deemed a “customer” with sole control of the account holding the
Imposition Deposits.
(c)    Payment of Impositions; Sufficiency of Imposition Deposits.
Lender may pay an Imposition according to any bill, statement, or estimate from
the appropriate public office or insurance company without inquiring into the
accuracy of the bill, statement, or estimate or into the validity of the
Imposition. Imposition Deposits shall be required to be used by Lender to pay
Taxes, insurance premiums and any other individual Imposition only if:
(1)    no Event of Default exists;
(2)    Borrower has timely delivered to Lender all applicable bills or premium
notices that it has received; and
(3)    sufficient Imposition Deposits are held by Lender for each Imposition at
the time such Imposition becomes due and payable.
Lender shall have no liability to Borrower or any other Person for failing to
pay any Imposition if any of the conditions are not satisfied. If at any time
the amount of the Imposition Deposits held for payment of a specific Imposition
exceeds the amount reasonably deemed necessary by Lender to be held in
connection with such Imposition, the excess may be credited against future
installments of Imposition Deposits for such Imposition.
(d)    Imposition Deposits Upon Event of Default.
If an Event of Default has occurred and is continuing, Lender may apply any
Imposition Deposits, in such amount and in such order as Lender determines, to
pay any Impositions or as a credit against the Indebtedness.

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(e)    Contesting Impositions.
Other than insurance premiums, Borrower may contest, at its expense, by
appropriate legal proceedings, the amount or validity of any Imposition if:
(1)    Borrower notifies Lender of the commencement or expected commencement of
such proceedings;
(2)    Lender determines that the applicable Mortgaged Property is not in danger
of being sold or forfeited;
(3)    Borrower deposits with Lender (or the applicable Governmental Authority
if required by Applicable Law) reserves sufficient to pay the contested
Imposition, if required by Lender (or the applicable Governmental Authority);
(4)    Borrower furnishes whatever additional security is required in the
proceedings or is reasonably requested in writing by Lender; and
(5)    Borrower commences, and at all times thereafter diligently prosecutes,
such contest in good faith until a final determination is made by the applicable
Governmental Authority.
(f)    Release to Borrower.
Upon payment in full of all sums secured by the Security Instrument and this
Master Agreement and release by Lender of the lien of the Security Instrument,
Lender shall disburse to Borrower the balance of any Imposition Deposits then on
deposit with Lender.
ARTICLE 13    
REPLACEMENT RESERVE AND REPAIRS
Section 13.01    Covenants.
(a)    Initial Deposits to Replacement Reserve Account and Repairs Escrow
Account.
On the Effective Date, Borrower shall pay to Lender:
(1)    the Initial Replacement Reserve Deposit for deposit into the Replacement
Reserve Account; and
(2)    the Repairs Escrow Deposit for deposit into the Repairs Escrow Account.
(b)    Monthly Replacement Reserve Deposits.
Borrower shall deposit the applicable Monthly Replacement Reserve Deposit into
the

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Replacement Reserve Account on each Payment Date.
(c)    Payment for Replacements and Repairs.
Borrower shall:
(1)    pay all invoices for the Replacements and Repairs, regardless of whether
funds on deposit in the Replacement Reserve Account or the Repairs Escrow
Account, as applicable, are sufficient, prior to any request by Borrower for
disbursement from the Replacement Reserve Account or the Repairs Escrow Account,
as applicable (unless Lender has agreed to issue joint checks in connection with
a particular Replacement or Repair);
(2)    pay all applicable fees and charges of any Governmental Authority on
account of the Replacements and Repairs, as applicable; and
(3)    provide evidence satisfactory to Lender of completion of the Replacements
and any Required Repairs (within the Completion Period or within such other
period or by such other date set forth in the Required Repair Schedule and any
Borrower Requested Repairs and Additional Lender Repairs (by the date specified
by Lender for any such Borrower Requested Repairs or Additional Lender
Repairs)).
(d)    Assignment of Contracts for Replacements and Repairs.
Borrower shall collaterally assign to Lender as additional security any contract
or subcontract for Replacements or Repairs, upon Lender’s written request, on a
form of assignment approved by Lender.
(e)    Indemnification.
If Lender elects to exercise its rights under Section 14.03 (Additional Lender
Rights; Forbearance) due to Borrower’s failure to timely commence or complete
any Replacements or Repairs, Borrower shall indemnify and hold Lender harmless
for, from and against any and all actions, suits, claims, demands, liabilities,
losses, damages, obligations, and costs or expenses, including litigation costs
and reasonable attorneys’ fees, arising from or in any way connected with the
performance by Lender of the Replacements or Repairs or investment of the
Reserve/Escrow Account Funds; provided that Borrower shall have no indemnity
obligation if such actions, suits, claims, demands, liabilities, losses,
damages, obligations, and costs or expenses, including litigation costs and
reasonable attorneys’ fees, arise as a result of the willful misconduct or gross
negligence of Lender, Lender’s agents, employees, or representatives as
determined by a court of competent jurisdiction pursuant to a final
non-appealable court order.
(f)    Amendments to Loan Documents.
Subject to Section 5.02 (Advances – Covenants) Borrower shall execute and
deliver to

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Lender, upon written request, an amendment to this Master Agreement, the
Security Instrument, any other Loan Document deemed necessary or desirable to
perfect Lender’s lien upon any portion of each Mortgaged Property for which
Reserve/Escrow Account Funds were expended.
(g)    Administrative Fees and Expenses.
Borrower shall pay to Lender:
(1)    by the date specified in the applicable invoice, the Repairs Escrow
Account Administrative Fee and the Replacement Reserve Account Administration
Fee for Lender’s services in administering the Repairs Escrow Account and
Replacement Reserve Account and investing the funds on deposit in the Repairs
Escrow Account and the Replacement Reserve Account, respectively;
(2)    within ten (10) Business Days of demand, a reasonable inspection fee, not
exceeding the Maximum Inspection Fee, for each inspection of a Mortgaged
Property by Lender in connection with a Repair or Replacement, plus all other
reasonable costs and out-of-pocket expenses relating to such inspections; and
(3)    within ten (10) Business Days of demand, all reasonable fees charged by
any engineer, architect, inspector or other person inspecting a Mortgaged
Property on behalf of Lender for each inspection of such Mortgaged Property in
connection with a Repair or Replacement, plus all other reasonable costs and
out-of-pocket expenses relating to such inspections.
Section 13.02    Administration Matters Regarding Reserves.
(a)    Accounts, Deposits, and Disbursements.
(1)    Custodial Accounts.
(A)    The Replacement Reserve Account shall be an interest-bearing account that
meets the standards for custodial accounts as required by Lender from time to
time. Lender shall not be responsible for any losses resulting from the
investment of the Replacement Reserve Deposits or for obtaining any specific
level or percentage of earnings on such investment. All interest, if any, earned
on the Replacement Reserve Deposits shall be added to and become part of the
Replacement Reserve Account; provided, however, if Applicable Law requires, and
so long as no Event of Default has occurred and is continuing under any of the
Loan Documents, Lender shall pay to Borrower the interest earned on the
Replacement Reserve Account not less frequently than the Replacement Reserve
Account Interest Disbursement Frequency. In no event shall Lender be obligated
to disburse funds from the Reserve/Escrow Account if an Event of Default has
occurred and is continuing.

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(B)    Lender shall not be obligated to deposit the Repairs Escrow Deposits into
an interest-bearing account.
(2)    Disbursements by Lender Only.
Only Lender or a designated representative of Lender may make disbursements from
the Replacement Reserve Account and the Repairs Escrow Account. Except as
provided in Section 13.02(a)(7) (Conditions to Disbursement), disbursements
shall only be made upon Borrower request and after satisfaction of all
conditions for disbursement.
(3)    Adjustment to Deposits.
(A)    Mortgaged Properties in Collateral Pool over Ten (10) Years.
If any Mortgaged Property is part of the Collateral Pool for ten (10) years or
more, a property condition assessment shall be ordered by Lender for such
Mortgaged Property at the expense of Borrower (which expense may be paid out of
the Replacement Reserve Account if excess funds are available). The property
condition assessment shall be performed no earlier than the sixth (6th) month
and no later than the ninth (9th) month of the tenth (10th) year after such
Mortgaged Property was added to the Collateral Pool (and of the twentieth (20th)
year if applicable). After review of the property condition assessment, the
amount of the Monthly Replacement Reserve Deposit may be adjusted by Lender for
the remaining Facility Year by written notice to Borrower so that the Monthly
Replacement Reserve Deposits are sufficient to fund the Replacements as and when
required and/or the amount to be held in the Repairs Escrow Account may be
adjusted by Lender so that the Repairs Escrow Deposit is sufficient to fund the
Repairs as and when required.
(B)    Transfers.
In connection with any Transfer of any Mortgaged Property, in connection with an
assumption, any Transfer of the Facility Operating Agreement, or any Transfer of
Ownership Interest(s) in a Borrower Entity or Affiliated Property Operator that
requires Lender’s consent, Lender may review the amounts on deposit, if any, in
the Replacement Reserve Account or the Repairs Escrow Account, the amount of the
Monthly Replacement Reserve Deposit for the applicable Mortgaged Property(ies)
and the likely repairs and replacements required by such Mortgaged
Property(ies), and the related contingencies which may arise during the
remaining Term of this Master Agreement. Based upon that review, Lender may
require an additional deposit to the Replacement Reserve Account or the Repairs
Escrow Account, or an increase in the amount of the Monthly Replacement Reserve
Deposit as a condition to Lender’s consent to such Transfer.

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(4)    Insufficient Funds.
Lender may, upon thirty (30) days’ prior written notice to Borrower, require an
additional deposit(s) to the Replacement Reserve Account or Repairs Escrow
Account, or an increase in the amount of the Monthly Replacement Reserve
Deposit, if Lender determines that the amounts on deposit in either the
Replacement Reserve Account or the Repairs Escrow Account are not sufficient to
cover the costs for Required Repairs or Required Replacements or, pursuant to
the terms of Section 13.02(a)(9) (Replacements and Repairs Other than Required
Replacements or Required Repairs), not sufficient to cover the costs for
Borrower Requested Repairs, Additional Lender Repairs, Borrower Requested
Replacements, or Additional Lender Replacements. Borrower’s agreement to
complete the Replacements or Repairs as required by this Master Agreement shall
not be affected by the insufficiency of any balance in the Replacement Reserve
Account or the Repairs Escrow Account, as applicable.
(5)    Disbursements for Replacements and Repairs.
(A)    Disbursement requests may only be made after completion of the applicable
Replacements and only to reimburse the applicable Borrower for the actual
approved costs of the Replacements. Lender shall not disburse from the
Replacement Reserve Account the costs of routine maintenance to any Mortgaged
Property or for costs which are to be reimbursed from the Repairs Escrow Account
or any similar account. Disbursement from the Replacement Reserve Account shall
not be made more frequently than the Maximum Replacement Reserve Disbursement
Interval for such Mortgaged Property. Other than in connection with a final
request for disbursement, disbursements from the Replacement Reserve Account
shall not be less than the Minimum Replacement Reserve Disbursement Amount for
such Mortgaged Property.
(B)    Disbursement requests may only be made after completion of the applicable
Repairs and only to reimburse the applicable Borrower for the actual cost of the
Repairs, up to the Maximum Repair Cost for such Mortgaged Property. Lender shall
not disburse any amounts which would cause the funds remaining in the Repairs
Escrow Account after any disbursement (other than with respect to the final
disbursement) to be less than the Maximum Repair Cost of the then-current
estimated cost of completing all remaining Repairs. Lender shall not disburse
from the Repairs Escrow Account the costs of routine maintenance to any
Mortgaged Property or for costs which are to be reimbursed from the Replacement
Reserve Account or any similar account. Disbursement from the Repairs Escrow
Account shall not be made more frequently than the Maximum Repair Disbursement
Interval. Other than in connection with a final request for disbursement,
disbursements from the Repairs Escrow Account shall not be less than the Minimum
Repairs Disbursement Amount for such Mortgaged Property.

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(6)    Disbursement Requests.
Each request by Borrower for disbursement from the Replacement Reserve Account
or the Repairs Escrow Account must be in writing, must specify the Replacement
or Repair for which reimbursement is requested (provided that for any Borrower
Requested Replacements, Borrower Requested Repairs, Additional Lender
Replacements and Additional Lender Repairs, Lender shall have approved the use
of the Reserve/Escrow Account Funds for such replacements or repairs pursuant to
the terms of Section 13.02(a)(9) (Replacements and Repairs Other than Required
Replacements or Required Repairs)), and must:
(A)    if applicable, specify the quantity and price of the items or materials
purchased, grouped by type or category;
(B)    if applicable, specify the cost of all contracted labor or other services
involved in the Replacement or Repair for which such request for disbursement is
made;
(C)    if applicable, include copies of invoices for all items or materials
purchased and all contracted labor or services provided;
(D)    include evidence of payment of such Replacement or Repair satisfactory to
Lender (unless Lender has agreed to issue joint checks in connection with a
particular Repair or Replacement as provided in this Master Agreement); and
(E)    contain a certification by Borrower and, if applicable (and if reasonably
requested by Lender), from Property Operator that the Repair or Replacement has
been completed lien free and in a good and workmanlike manner, in accordance
with any plans and specifications previously approved by Lender (if applicable)
and in compliance with all Applicable Law, and otherwise in accordance with the
provisions of this Master Agreement.
(7)    Conditions to Disbursement.
Lender may require any or all of the following at the expense of Borrower as a
condition to disbursement of funds from the Replacement Reserve Account or the
Repairs Escrow Account that are in excess of $10,000 or for life safety Repairs
or Replacements (provided that for any Borrower Requested Replacements, Borrower
Requested Repairs, Additional Lender Replacements, and Additional Lender
Repairs, Lender shall have approved the use of the Reserve/Escrow Account Funds
for such replacements or repairs pursuant to the terms of Section 13.02(a)(9)
(Replacements and Repairs Other than Required Replacements or Required
Repairs)):
(A)    an inspection by Lender of the applicable Mortgaged Property and the
applicable Replacement or Repair;

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(B)    an inspection or certificate of completion by an appropriate independent
qualified professional (such as an architect, engineer or property inspector,
depending on the nature of the Repair or Replacement) selected by Lender;
(C)    a search of title to the Mortgaged Property effective to the date of
disbursement or, if Lender reasonably determines that such endorsement is
necessary to maintain the priority of the Lien created in favor of Lender with
respect to the Mortgage Loan or to maintain the validity of the Title Policy, a
“date-down” endorsement to Lender’s Title Policy (or a new Lender’s Title Policy
if a “date-down” is not available) extending the effective date of such policy
to the date of disbursement, and showing no Liens other than (i) Permitted
Encumbrances, (ii) liens which Borrower is diligently contesting in good faith
that have been bonded off to the satisfaction of Lender, or (iii) mechanics’ or
materialmen’s liens which attach automatically under the laws of any
Governmental Authority upon the commencement of any work upon, or delivery of
any materials to, the Mortgaged Property and for which Borrower is not
delinquent in the payment for any such work or materials; and
(D)    an acknowledgement of payment, waiver of claims, and release of lien for
work performed and materials supplied from each contractor, subcontractor or
materialman in accordance with the requirements of Applicable Law and covering
all work performed and materials supplied (including equipment and fixtures) for
the applicable Mortgaged Property by that contractor, subcontractor, or
materialman through the date covered by the disbursement request (or, in the
event that payment to such contractor, subcontractor, or materialman is to be
made by a joint check, the release of lien shall be effective through the date
covered by the previous disbursement).
(8)    Joint Checks for Periodic Disbursements.
Lender may, upon Borrower’s written request, issue joint checks, payable to
Borrower and the applicable supplier, materialman, mechanic, contractor,
subcontractor or other similar party, if:
(A)    the cost of the Replacement or Repair exceeds the Replacement Threshold
or the Repair Threshold, as applicable, for such Mortgaged Property and the
contractor performing such Replacement or Repair requires periodic payments
pursuant to the terms of the applicable written contract;
(B)    the contract for such Repair or Replacement requires payment upon
completion of the applicable portion of the work;
(C)    Borrower makes the disbursement request after completion of the
applicable portion of the work required to be completed under such contract;

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(D)    the materials for which the request for disbursement has been made are on
site at the applicable Mortgaged Property and are properly secured or installed;
(E)    Lender determines that the remaining funds in the Replacement Reserve
Account designated for such Replacement, or in the Repairs Escrow Account
designated for such Repair, as applicable, are sufficient to pay such costs and
the then-current estimated cost of completing all remaining Required
Replacements or Required Repairs (at the Maximum Repair Cost), as applicable,
and any other Borrower Requested Replacements, Borrower Requested Repairs,
Additional Lender Replacements, or Additional Lender Repairs that have been
previously approved by Lender;
(F)    each supplier, materialman, mechanic, contractor, subcontractor, or other
similar party receiving payments shall have provided, if requested in writing by
Lender, a waiver of liens with respect to amounts which have been previously
paid to them; and
(G)    all other conditions for disbursement have been satisfied.
(9)    Replacements and Repairs Other than Required Replacements or Required
Repairs.
(A)    Borrower Requested Replacements and Borrower Requested Repairs.
Borrower may submit a disbursement request from the Replacement Reserve Account
or the Repairs Escrow Account to reimburse Borrower for any Borrower Requested
Replacement or Borrower Requested Repair. The disbursement request must be in
writing and include an explanation for such request. Lender shall make
disbursements for Borrower Requested Replacements or Borrower Requested Repairs
if:
(i)    they are of the type intended to be covered by the Replacement Reserve
Account or the Repairs Escrow Account, as applicable;
(ii)    the costs are commercially reasonable;
(iii)    the amount of funds in the Replacement Reserve Account or Repairs
Escrow Account, as applicable, is sufficient to pay such costs and the
then-current estimated cost of completing all remaining Required Replacements or
Required Repairs (at the Maximum Repair Cost), as applicable, and any other
Borrower Requested Replacements, Borrower

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Requested Repairs, Additional Lender Replacements or Additional Lender Repairs
that have been previously approved by Lender; and
(iv)    all conditions for disbursement from the Replacement Reserve Account or
Repairs Escrow Account, as applicable, have been satisfied.
Nothing in this Master Agreement shall limit Lender’s right to require an
additional deposit to the Replacement Reserve Account or an increase to the
Monthly Replacement Reserve Deposit in connection with any such Borrower
Requested Replacements, or an additional deposit to the Repairs Escrow Account
for any such Borrower Requested Repairs.
(B)    Additional Lender Replacements and Additional Lender Repairs.
Lender may require, as set forth in Section 6.02(b) (Property Maintenance),
Section 6.02(c) (Property Condition Assessment), or otherwise from time to time,
upon written notice to Borrower, that Borrower make Additional Lender
Replacements or Additional Lender Repairs. Lender shall make disbursements from
the Replacement Reserve Account for Additional Lender Replacements or from the
Repairs Escrow Account for Additional Lender Repairs, as applicable, if:
(i)    the costs are commercially reasonable;
(ii)    the amount of funds in the Replacement Reserve Account or the Repairs
Escrow Account, as applicable, is sufficient to pay such costs and the
then-current estimated cost of completing all remaining Required Replacements or
Required Repairs (at the Maximum Repair Cost), as applicable, and any other
Borrower Requested Replacements, Borrower Requested Repairs, Additional Lender
Replacements or Additional Lender Repairs that have been previously approved by
Lender; and
(iii)    all conditions for disbursement from the Replacement Reserve Account or
Repairs Escrow Account, as applicable, have been satisfied.
Nothing in this Master Agreement shall limit Lender’s right to require an
additional deposit to the Replacement Reserve Account or an increase to the
Monthly Replacement Reserve Deposit for any such Additional Lender Replacements
or an additional deposit to the Repairs Escrow Account for any such Additional
Lender Repair.
(10)    Excess Costs.
In the event any Replacement or Repair exceeds the approved cost set forth on
the Required Replacement Schedule for Replacements, or the Maximum Repair Cost
for Repairs, Borrower may submit a disbursement request to reimburse Borrower
for such excess cost. The disbursement request must be in writing and include an
explanation for such request. Lender shall make

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disbursements from the Replacement Reserve Account or the Repairs Escrow
Account, as applicable, if:
(A)    the excess cost is commercially reasonable;
(B)    the amount of funds in the Replacement Reserve Account or the Repairs
Escrow Account, as applicable, is sufficient to pay such costs and the
then-current estimated cost of completing all remaining Required Replacements or
Required Repairs (at the Maximum Repair Cost), as applicable, and any other
Borrower Requested Replacements, Borrower Requested Repairs, Additional Lender
Replacements, or Additional Lender Repairs that have been previously approved by
Lender; and
(C)    all conditions for disbursement from the Replacement Reserve Account or
the Repairs Escrow Account have been satisfied.
(11)    Final Disbursements.
Upon completion of all Repairs in accordance with this Master Agreement and so
long as no Event of Default has occurred and is continuing, Lender shall
disburse to Borrower any amounts then remaining in the Repairs Escrow Account.
Upon payment in full of the Indebtedness and release by Lender of the lien of
the Security Instrument, Lender shall disburse to Borrower any and all amounts
then remaining in the Replacement Reserve Account and the Repairs Escrow Account
(if not previously released).
(b)    Approvals of Contracts; Assignment of Claims.
Lender retains the right to approve all contracts or work orders with
materialmen, mechanics, suppliers, subcontractors, contractors, or other parties
providing labor or materials in connection with the Replacements or Repairs in
excess of $50,000.00. Notwithstanding Borrower’s assignment in the Security
Instrument (or Property Operator’s assignment pursuant to the SASA) of its
rights and claims against all Persons supplying labor or materials in connection
with the Replacement or Repairs, Lender will not pursue any such right or claim
unless an Event of Default has occurred and is continuing or as otherwise
provided in Section 14.03(c) (Appointment of Lender as Attorney-In-Fact).
(c)    Delays and Workmanship.
If any work for any Replacement or Repair has not timely commenced, has not been
timely performed in a workmanlike manner, or has not been timely completed in a
workmanlike manner, Lender may, without notice to Borrower:
(1)    withhold disbursements from the Replacement Reserve Account or Repairs
Escrow Account for such unsatisfactory Replacement or Repair, as applicable;

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(2)    proceed under existing contracts or contract with third parties to make
or complete such Replacement or Repair;
(3)    apply the funds in the Replacement Reserve Account or Repairs Escrow
Account toward the labor and materials necessary to make or complete such
Replacement or Repair, as applicable; or
(4)    exercise any and all other remedies available to Lender under this Master
Agreement or any other Loan Document, including any remedies otherwise available
upon an Event of Default pursuant to the terms of Section 14.02 (Remedies).
To facilitate Lender’s completion or making of such Replacements or Repairs,
Lender shall have the right to enter onto each Mortgaged Property and perform
any and all work and labor necessary to make or complete the Replacements or
Repairs and employ watchmen to protect such Mortgaged Property from damage. All
funds so expended by Lender shall be deemed to have been advanced to Borrower,
shall be part of the Indebtedness and shall be secured by the Security
Instrument and this Master Agreement.
(d)    Appointment of Lender as Attorney-In-Fact.
Borrower hereby authorizes and appoints Lender as attorney-in-fact pursuant to
Section 14.03(c) (Appointment of Lender as Attorney-In-Fact).
(e)    No Lender Obligation.
Nothing in this Master Agreement shall:
(1)    make Lender responsible for making or completing the Replacements or
Repairs;
(2)    require Lender to expend funds, whether from the Replacement Reserve
Account, the Repairs Escrow Account or otherwise, to make or complete any
Replacement or Repair;
(3)    obligate Lender to proceed with the Replacements or Repairs; or
(4)    obligate Lender to demand from Borrower additional sums to make or
complete any Replacement or Repair.
(f)    No Lender Warranty.
Lender’s approval of any plans for any Replacement or Repair, release of funds
from the Replacement Reserve Account or Repairs Escrow Account, inspection of
any Mortgaged Property by Lender or its agents, representatives, or designees,
or other acknowledgment of completion of any Replacement or Repair in a manner
satisfactory to Lender shall not be deemed an acknowledgment or warranty to any
Person that the Replacement or Repair has been completed in

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accordance with applicable building, zoning or other codes, ordinances,
statutes, laws, regulations or requirements of any Governmental Authority, such
responsibility being at all times exclusively that of Borrower.
ARTICLE 14    
DEFAULTS/REMEDIES
Section 14.01    Events of Default.
The occurrence of any one or more of the following in this Section 14.01 (Events
of Default) shall constitute an Event of Default under this Master Agreement.
(a)    Automatic Events of Default.
Any of the following shall constitute an automatic Event of Default:
(1)    any failure to pay or deposit when due any amount required by the Note,
this Master Agreement or any other Loan Document;
(2)    any failure by Borrower to maintain the insurance coverage required by
any Loan Document;
(3)    any failure by Borrower to comply with the provisions of Section 4.02(d)
(Borrower Status – Covenants – Single Purpose Status) relating to its single
asset status;
(4)    if any warranty, representation, certification, or statement of Borrower
or Guarantor in this Master Agreement or any of the other Loan Documents is
false, inaccurate, or misleading in any material respect when made;
(5)    fraud, gross negligence, willful misconduct or material misrepresentation
or material omission by or on behalf of Borrower, Affiliated Property Operator,
Guarantor or Key Principal or any of their officers, directors, trustees,
partners, members, or managers in connection with:
(A)    the application for, or creation of, the Indebtedness;
(B)    any financial statement, rent roll, or other report or information
provided to Lender pursuant to a requirement of this Master Agreement; or
(C)    any request for Lender’s consent to any proposed action, including a
request for disbursement of Reserve/Escrow Account Funds or Collateral Account
Funds;
(6)    the occurrence of any Transfer (other than a Transfer consisting solely
of a breach of Section 7.02(b)(1) or Section 7.02(b)(2)) not permitted by the
Loan Documents;

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(7)    the occurrence of a Bankruptcy Event;
(8)    the commencement of a forfeiture action or proceeding, whether civil or
criminal, which, in Lender’s reasonable judgment, could result in a forfeiture
of any Mortgaged Property or otherwise materially impair the lien created by
this Master Agreement or the Security Instrument or Lender’s interest in any
Mortgaged Property;
(9)    if Borrower, Affiliated Property Operator, Guarantor or Key Principal is
a trust (other than a REIT), or if a Transfer of the Restricted Ownership
Interest or a Change of Control occurs due to the termination or revocation of a
trust, the termination or revocation of such trust, except as set forth in
Section 11.03(d) (Termination or Revocation of Trust);
(10)    subject to the provisions of Section 6.02(b)(4)(D), any failure by
Borrower to complete any Repair related to fire, life or safety issues in
accordance with the terms of this Master Agreement within the Completion Period
(or such other date set forth on the Required Repair Schedule or otherwise
required by Lender in writing for such Repair);
(11)    any exercise by the holder of any other debt instrument secured by a
mortgage, deed of trust, or deed to secure debt on any Mortgaged Property of a
right to declare all amounts due under that debt instrument immediately due and
payable;
(12)    a dissolution or liquidation for any reason (whether voluntary or
involuntary) of Borrower Entity, Affiliated Property Operator, or any general
partner, managing member, or sole member of any Borrower Entity or Affiliated
Property Operator;
(13)    amendment or modification of Facility Operating Agreement not permitted
by the Loan Documents;
(14)    any failure by Borrower or any Property Operator to comply with the
requirement to use the Mortgaged Property as a Seniors Housing Facility with the
acuity mix approved by Lender on the Effective Date that such Mortgaged Property
became a part of the Collateral Pool (subject to Borrower’s right to modify the
acuity mix by an Allowed Change in Use pursuant to Section 6.02(a)) or as
subsequently approved by Lender) or failure to comply with any License
requirements set forth in any Loan Document or as required by any Applicable
Law, other than deficiencies cited in routine licensure surveys which
deficiencies are capable of being cured by Borrower or Property Operator in the
ordinary course and prior to the expiration of the time frame, if any, noted for
cure in such survey or any plan of correction submitted in response to such
survey, subject to any additional cure periods allowed by any applicable
Governmental Authority with respect thereto which deficiencies shall become an
Event of Default after the expiration of the time frame, if any, noted for cure
in such survey or any plan of correction without cure;
(15)    a Transfer of the Licenses not permitted by the Loan Documents
authorizing any Mortgaged Property to operate as a Seniors Housing Facility, or
a change in the holder

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of the Licenses authorizing any Mortgaged Property to operate as a Seniors
Housing Facility, in violation of the Loan Documents, except any such Transfer
of the Licenses or change in the holder of the Licenses as a result of which the
holder of the Licenses is the applicable Borrower or an Affiliated Property
Operator;
(16)    a termination of any Facility Operating Agreement not permitted by the
Loan Documents;
(17)    (A) any loss by Borrower or any Property Operator of any License or
other legal authority necessary to operate any Mortgaged Property as a Seniors
Housing Facility, or (B) any failure by Borrower or any Property Operator to
comply strictly with any consent order or decree or to correct, within the time
deadlines set by any federal, state, or local licensing agency, any deficiency
where such failure results, or under Applicable Laws and regulations, is
reasonably likely to result, in an action by such agency with respect to the
Mortgaged Property that may have a Material Adverse Effect on Borrower, any
Property Operator with respect to the Mortgaged Property, or the management and
operations of the Mortgaged Property or Borrower’s or Property Operator’s
interest in the Mortgaged Property, including a termination, revocation, or
suspension of any applicable Licenses necessary for the operation of the
Mortgaged Property as a Seniors Housing Facility;
(18)    if Borrower or any Property Operator:
(A)    ceases to operate the Mortgaged Property as a Seniors Housing Facility or
takes any action or permits to exist any condition that causes the Mortgaged
Property to no longer be classified as a Seniors Housing Facility;
(B)    ceases to provide such kitchens, separate bathrooms, and areas for
eating, sitting, and sleeping in each independent living or assisted living unit
or at a minimum, central bathing and dining facilities for Alzheimer’s/dementia
care, as are provided as of the Effective Date the Mortgaged Property is added
to the Collateral Pool;
(C)    ceases to provide other facilities and services normally associated with
independent living or assisted living units including (i) central dining
services providing up to three (3) meals per day, (ii) periodic housekeeping,
(iii) laundry services, (iv) customary transportation services, and (v) social
activities;
(D)    provides or contracts for skilled nursing care for any of the units other
than in compliance with Schedule 19; or
(E)    leases or holds available for lease to commercial tenants non-residential
space (i.e., space other than the units, dining areas, activity rooms, lobby,
parlors, kitchen, mailroom, marketing/management offices) exceeding ten percent
(10%) of the net rental area;

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(19)    a default which continues beyond any applicable cure period under any
Facility Operating Agreement;
(20)    an Event of Default under any SASA that may be executed pursuant to this
Master Agreement;
(21)    any failure by Borrower to release any Mineral Conveyance Property (and,
if applicable, provide a replacement Mortgaged Property if a Substitution is
required) as and when required pursuant to Section 6.02(m)(4);
(22)    Borrower (A) terminates or revokes or attempts to terminate or revoke
the appointment of Lender as Borrower’s proxy or attorney-in-fact either
permanently or as to any election in the Condominium Act or Condominium
Documents or (B) consents to the modification of or proposes to modify the terms
of the Condominium Documents without the prior written consent of Lender; or
(23)    any failure by Borrower to perform or observe any covenant contained in
Sections 6.01(m), 6.02(m), 6.02(n) and 6.02(o).
(b)    Events of Default Subject to a Specified Cure Period.
Any of the following shall constitute an Event of Default subject to the cure
period set forth in the Loan Documents:
(1)    if Key Principal or Guarantor is a natural Person, the death of such
individual, unless all requirements of Section 11.03(e) (Death of Key Principal
or Guarantor; Restricted Ownership Interest/Controlling Interest Transfer Due to
Death) are met;
(2)    Intentionally Deleted.
(3)    any failure by Borrower, Affiliated Property Operator, Key Principal, or
Guarantor to comply with the provisions of Section 5.02(b) (Further Assurances)
and Section 5.02(c) (Sale of Advances);
(4)    any failure by Borrower to perform any obligation under this Master
Agreement or any Loan Document that is subject to a specified written notice and
cure period, which failure continues beyond such specified written notice and
cure period as set forth herein or in the applicable Loan Document; and
(5)    a breach of Section 7.02(b)(1) or Section 7.02(b)(2) that is not cured to
Lender’s satisfaction within thirty (30) days after such breach occurs.
(c)    Events of Default Subject to Extended Cure Period or Release.
The following shall constitute an Event of Default if the existence of such
condition or

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event, or such failure to perform or default in performance continues for a
period of thirty (30) days after written notice by Lender to Borrower of the
existence of such condition or event, or of such failure to perform or default
in performance, provided, however, such period may be extended for up to an
additional thirty (30) days if Borrower, in the discretion of Lender, is
diligently pursuing a cure of such; provided, further, however, no such written
notice, grace period or extension shall apply if, in Lender’s discretion,
immediate exercise by Lender of a right or remedy under this Master Agreement or
any Loan Document is required to avoid harm to Lender or impairment of the
Indebtedness, the Mortgaged Property or any other security given to secure the
Indebtedness:
(1)    any failure by Borrower to perform any of its obligations under this
Master Agreement or any Loan Document (other than those specified in Section
14.01(a) (Automatic Events of Default) or Section 14.01(b) (Events of Default
Subject to a Specified Cure Period)) as and when required.
Notwithstanding anything to the contrary herein or in any other Loan Document,
if an Event of Default shall occur hereunder or under any other Loan Document
because a representation, warranty, affirmative covenant, negative covenant, or
other provision hereunder or thereunder shall be breached or violated that in
Lender’s sole and exclusive judgment is with respect to a particular Mortgaged
Property (other than any misappropriation of funds collected in respect thereof)
(each, a “Property-Specific Event of Default”), such Event of Default shall be
deemed cured if Borrower shall satisfy all of the conditions set forth in
Section 2.10(b) (Right to Obtain Releases of Mortgaged Property) of this Master
Agreement relating to the Release of such Mortgaged Property from the Collateral
Pool within thirty (30) days of Borrower acquiring knowledge of such Event of
Default (the “Release Cure Period”). During the Release Cure Period, Lender
agrees that it shall not have the right to exercise the remedy set forth in
Section 14.02 (Remedies) of this Master Agreement; provided, however, that the
foregoing shall not impair Lender’s right to exercise the remedies available to
Lender under any of the other Loan Documents or at law or in equity or under
Section 14.03(b) (No Waiver of Rights or Remedies) during such Release Cure
Period. If Lender shall elect to exercise any such remedies during such period,
and if Borrower releases such Mortgaged Property pursuant to the provisions of
the Mortgaged Property Release Schedule as described in the preceding sentence
and at the time of such release no other Event of Default has occurred and is
continuing, Lender shall cease exercising such remedies with respect to the
applicable Property-Specific Event of Default and discontinue any proceedings it
may have initiated in connection therewith, and the parties shall be restored to
their former positions and rights hereunder; provided, however, that if Borrower
shall fail to satisfy all of the conditions set forth in the Mortgaged Property
Release Schedule relating to the release of such Mortgaged Property from the
Collateral Pool during the Release Cure Period, Lender may thereafter exercise
any and all remedies available to Lender under Article 14 (Defaults/Remedies) of
this Master Agreement, including, without limitation, the remedies set forth in
Section 14.02 (Remedies).

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Section 14.02    Remedies.
(a)    Acceleration; Foreclosure.
(1)    If an Event of Default has occurred and is continuing, the entire unpaid
principal balance of the Advances Outstanding, any Accrued Interest, interest
accruing at the Default Rate, the Prepayment Premium (if applicable), and all
other Indebtedness, at the option of Lender, shall immediately become due and
payable, without any prior written notice to Borrower, unless Applicable Law
requires otherwise (and in such case, after any required written notice has been
given). Lender may exercise this option to accelerate regardless of any prior
forbearance. In addition, Lender shall have all rights and remedies afforded to
Lender hereunder and under the other Loan Documents, including, foreclosure on
and/or the power of sale of any or all of the Mortgaged Properties, as provided
in the Security Instrument, and any rights and remedies available to Lender at
law or in equity (subject to Borrower’s statutory rights of reinstatement, if
any). Any proceeds of a Foreclosure Event may be held and applied by Lender as
additional collateral for the Indebtedness pursuant to this Master Agreement.
Notwithstanding the foregoing, the occurrence of any Bankruptcy Event of
Borrower shall automatically accelerate the Indebtedness, which Indebtedness
shall be immediately due and payable without written notice or further action by
Lender.
(2)    Lender may Accelerate any Note without the obligation, but the right to
accelerate any other Note (if more than one). In the exercise of its rights and
remedies under the Loan Documents, Lender may, except as provided in this Master
Agreement, exercise and perfect any and all of its rights in and under the Loan
Documents with regard to any Mortgaged Property without the obligation (but with
the right) to exercise and perfect its rights and remedies with respect to any
other Mortgaged Property. Any such exercise shall be without regard to the
Allocable Facility Amount assigned to such Mortgaged Property. Lender may
recover an amount equal to the full amount Outstanding in respect of any of the
Notes in connection with such exercise. Any such amount shall be applied to the
Obligations as determined by Lender.
(b)    Loss of Right to Disbursements from Collateral Accounts.
If an Event of Default has occurred and is continuing, Borrower shall
immediately lose all of its rights to receive disbursements from the
Reserve/Escrow Accounts and any Collateral Accounts. During the continuance of
any such Event of Default, Lender may use the Reserve/Escrow Account Funds and
any Collateral Account Funds (or any portion thereof) for any purpose,
including:
(1)    repayment of the Indebtedness, including principal prepayments and the
Prepayment Premium applicable to such full or partial prepayment, as applicable
(however, such application of funds shall not cure or be deemed to cure any
Event of Default);

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(2)    reimbursement of Lender for all losses and expenses (including reasonable
legal fees) suffered or incurred by Lender as a result of such Event of Default;
(3)    completion of the Replacement or Repair or for any other replacement or
repair to a Mortgaged Property; and
(4)    payment of any amount expended in exercising (and the exercise of) all
rights and remedies available to Lender at law or in equity or under this Master
Agreement or under any of the other Loan Documents.
Nothing in this Master Agreement shall obligate Lender to apply all or any
portion of the Reserve/Escrow Account Funds or Collateral Account Funds on
account of any Event of Default by Borrower or to repayment of the Indebtedness
or in any specific order of priority.
(c)    Remedies Cumulative.
Each right and remedy provided in this Master Agreement is distinct from all
other rights or remedies under this Master Agreement or any other Loan Document
or afforded by Applicable Law, and each shall be cumulative and may be exercised
concurrently, independently or successively, in any order. Lender shall not be
required to demonstrate any actual impairment of its security or any increased
risk of additional default by Borrower in order to exercise any of its remedies
with respect to an Event of Default.
(d)    Operations upon Event of Default; Lockbox Account.
(1)    If an Event of Default has occurred and is continuing:
(A)    Borrower shall or shall cause each Property Operator to, at the option of
Lender, continue to provide all necessary services required under each Facility
Operating Agreement or applicable licensing or regulatory requirements to
operate and manage the Mortgaged Property as a Seniors Housing Facility and
shall fully cooperate with Lender and any receiver as may be appointed by a
court, in performing these services and agrees to arrange for an orderly
transition to a replacement property operator or provider of the necessary
services, and to execute promptly all applications, assignments, consents, and
documents requested by Lender to facilitate such transition; and
(B)    Lender may cause the removal of Borrower or any Property Operator (as
applicable) from any Mortgaged Property operations. Until such time as Lender
has located a replacement property operator, Borrower or the acting Property
Operator shall continue to provide all required services to maintain the
Mortgaged Property in full compliance with all License and regulatory
requirements. Borrower acknowledges that its failure to perform or to cause the
performance of this service shall constitute a form of waste of the Mortgaged

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Property, causing irreparable harm to Lender and the Mortgaged Property, and
shall constitute sufficient cause for the appointment of a receiver.
(2)    In addition to the remedies set forth herein and elsewhere in the Loan
Documents, upon an Event of Default, Lender shall be entitled to mandate the use
of a lockbox bank account or other depositary account, to be maintained under
the control and supervision of Lender, for all income of the Mortgaged Property,
including Rents, service charges, insurance payments, and Third Party Payments.
Section 14.03    Additional Lender Rights; Forbearance.
(a)    No Effect Upon Obligations.
Lender may, but shall not be obligated to, agree with Borrower, from time to
time, and without giving notice to, or obtaining the consent of, or having any
effect upon the obligations of any Property Operator, Guarantor, Key Principal,
or other third party obligor, to take any of the following actions:
(1)    the time for payment of the principal of or interest on the Indebtedness
may be extended, or the Indebtedness may be renewed in whole or in part;
(2)    the rate of interest on or period of amortization of the Advances or the
amount of the Monthly Debt Service Payments payable under the Loan Documents may
be modified;
(3)    the time for Borrower’s performance of or compliance with any covenant or
agreement contained in any Loan Document, whether presently existing or
hereinafter entered into, may be extended or such performance or compliance may
be waived;
(4)    any or all payments due under this Master Agreement or any other Loan
Document may be reduced;
(5)    any Loan Document may be modified or amended by Lender and Borrower in
any respect, including an increase in the principal amount of the Advances;
(6)    any amounts under this Master Agreement or any other Loan Document may be
released;
(7)    any security for the Indebtedness may be modified, exchanged, released,
surrendered, or otherwise dealt with, or additional security may be pledged or
mortgaged for the Indebtedness;
(8)    the payment of the Indebtedness or any security for the Indebtedness, or
both, may be subordinated to the right to payment or the security, or both, of
any other present or future creditor of Borrower; or

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(9)    any other terms of the Loan Documents may be modified.
(b)    No Waiver of Rights or Remedies.
Any waiver of an Event of Default or forbearance by Lender in exercising any
right or remedy under this Master Agreement or any other Loan Document or
otherwise afforded by Applicable Law, shall not be a waiver of any other Event
of Default or preclude the exercise or failure to exercise of any other right or
remedy. The acceptance by Lender of payment of all or any part of the
Indebtedness after the due date of such payment, or in an amount which is less
than the required payment, shall not be a waiver of Lender’s right to require
prompt payment when due of all other payments on account of the Indebtedness or
to exercise any remedies for any failure to make prompt payment. Enforcement by
Lender of any security for the Indebtedness shall not constitute an election by
Lender of remedies so as to preclude the exercise or failure to exercise of any
other right available to Lender. Lender’s receipt of any insurance proceeds or
amounts in connection with a Condemnation Action shall not operate to cure or
waive any Event of Default.
(c)    Appointment of Lender as Attorney-In-Fact.
Borrower hereby irrevocably makes, constitutes, and appoints Lender (and any
officer of Lender or any Person designated by Lender for that purpose) as
Borrower’s true and lawful proxy and attorney-in-fact (and agent-in-fact) in
Borrower’s name, place, and stead, with full power of substitution, to:
(1)    use any of the funds in the Replacement Reserve Account or Repairs Escrow
Account for the purpose of making or completing the Replacements or Repairs;
(2)    make such additions, changes, and corrections to the Replacements or
Repairs as shall be necessary or desirable to complete the Replacements or
Repairs;
(3)    employ such contractors, subcontractors, agents, architects, and
inspectors as shall be required for such purposes;
(4)    pay, settle, or compromise all bills and claims for materials and work
performed in connection with the Replacements or Repairs, or as may be necessary
or desirable for the completion of the Replacements or Repairs, or for clearance
of title;
(5)    adjust and compromise any claims under any and all policies of insurance
required pursuant to this Master Agreement and any other Loan Document, subject
only to Borrower’s rights under this Master Agreement;
(6)    appear in and prosecute any action arising from any insurance policies;
(7)    collect and receive the proceeds of insurance, and to deduct from such
proceeds Lender’s expenses incurred in the collection of such proceeds;

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(8)    commence, appear in, and prosecute, in Lender’s or Borrower’s name, any
Condemnation Action;
(9)    settle or compromise any claim in connection with any Condemnation
Action;
(10)    execute all applications and certificates in the name of Borrower which
may be required by any of the contract documents;
(11)    prosecute and defend all actions or proceedings in connection with any
Mortgaged Property or the rehabilitation and repair of any Mortgaged Property;
(12)    take such actions as are permitted in this Master Agreement and any
other Loan Documents;
(13)    execute such financing statements and other documents and to do such
other acts as Lender may require to perfect and preserve Lender’s security
interest in, and to enforce such interests in, the collateral; and
(14)    carry out any remedy provided for in this Master Agreement and any other
Loan Documents, including endorsing Borrower’s name to checks, drafts,
instruments, and other items of payment and proceeds of the collateral,
executing change of address forms with the postmaster of the United States Post
Office serving the address of Borrower, changing the address of Borrower to that
of Lender, opening all envelopes addressed to Borrower, and applying any
payments contained therein to the Indebtedness.
Borrower hereby acknowledges that the constitution and appointment of such proxy
and attorney-in-fact are coupled with an interest and are irrevocable and shall
not be affected by the disability or incompetence of Borrower. Borrower
specifically acknowledges and agrees that this power of attorney granted to
Lender may be assigned by Lender to Lender’s successors or assigns as holder of
the Note (and the other Loan Documents). The foregoing powers conferred on
Lender under this Section 14.03(c) (Appointment of Lender as Attorney-In-Fact)
shall not impose any duty upon Lender to exercise any such powers and shall not
require Lender to incur any expense or take any action. Borrower hereby ratifies
and confirms all that such attorney-in-fact may do or cause to be done by virtue
of any provision of this Master Agreement and any other Loan Documents.
Notwithstanding the foregoing provisions, Lender shall not exercise its rights
as set forth in this Section 14.03(c) (Appointment of Lender as
Attorney-in-Fact) unless: (A) an Event of Default has occurred and is continuing
or (B) Lender determines in its discretion, that exigent circumstances exist or
that such exercise is necessary or prudent in order to protect and preserve the
Mortgaged Property, or Lender’s lien priority and security interest in the
Mortgaged Property.

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(d)    Borrower Waivers.
If more than one Person signs this Master Agreement as Borrower, each Borrower,
with respect to any other Borrower, hereby agrees that Lender, in its
discretion, may:
(1)    bring suit against Borrower, or any one or more of Borrower, jointly and
severally, or against any one or more of them;
(2)    compromise or settle with any one or more of the persons constituting
Borrower, for such consideration as Lender may deem proper;
(3)    release one or more of the persons constituting Borrower, from liability;
or
(4)    otherwise deal with Borrower, or any one or more of them, in any manner,
and no such action shall impair the rights of Lender to collect from any
Borrower the full amount of the Indebtedness.
Section 14.04    Waiver of Marshaling.
Notwithstanding the existence of any other security interests in the Mortgaged
Properties held by Lender or by any other party, Lender shall have the right to
determine the order in which any or all of the Mortgaged Properties (or any part
thereof) shall be subjected to the remedies provided in this Master Agreement,
any other Loan Document or Applicable Law. Lender shall have the right to
determine the order in which all or any part of the Indebtedness is satisfied
from the proceeds realized upon the exercise of such remedies. Borrower and any
party who now or in the future acquires a security interest in any Mortgaged
Property and who has actual or constructive notice of this Master Agreement
waives any and all right to require the marshaling of assets or to require that
any of the Mortgaged Properties be sold in the inverse order of alienation or
that any of the Mortgaged Properties be sold in parcels or as an entirety in
connection with the exercise of any of the remedies permitted by Applicable Law
or provided in this Master Agreement or any other Loan Documents.
Lender shall account for any moneys received by Lender in respect of any
foreclosure on or disposition of collateral hereunder and under the other Loan
Documents provided that Lender shall not have any duty as to any collateral, and
Lender shall be accountable only for amounts that it actually receives as a
result of the exercise of such powers. NONE OF LENDER OR ITS AFFILIATES,
OFFICERS, DIRECTORS, EMPLOYEES, AGENTS, OR REPRESENTATIVES SHALL BE RESPONSIBLE
TO BORROWER (a) FOR ANY ACT OR FAILURE TO ACT UNDER ANY POWER OF ATTORNEY OR
OTHERWISE, EXCEPT IN RESPECT OF DAMAGES ATTRIBUTABLE SOLELY TO THEIR OWN GROSS
NEGLIGENCE OR WILLFUL MISCONDUCT AS FINALLY DETERMINED PURSUANT TO A FINAL,
NON-APPEALABLE COURT ORDER BY A COURT OF COMPETENT JURISDICTION, NOR (b) FOR ANY
PUNITIVE, EXEMPLARY, INDIRECT OR CONSEQUENTIAL DAMAGES.

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Section 14.05    Severed Loan Documents.
Lender shall have the right from time to time to sever the Note and the other
Loan Documents into one or more separate notes, mortgages, and other security
documents (the “Severed Loan Documents”) in such denominations as Lender shall
determine in its discretion for purposes of evidencing and enforcing its rights
and remedies provided hereunder, provided that:
(a)    the amount of Advances Outstanding immediately after the effective date
of such modification equals the amount of Advances Outstanding immediately prior
to such modification;
(b)    the weighted average of the interest rates for Advances Outstanding
immediately after the effective date of such modification equals the weighted
average of the interest rates for Advances Outstanding immediately prior to such
modification;
(c)    each future principal payment shall be ratably allocated to each Advance
based on the Outstanding principal balance of such Advance at the time of such
modification and each future amortization payment shall be ratably paid in
accordance with such allocation at all times;
(d)    there shall be no other change to the economic and/or other material
terms, rights and obligations of Borrower under the Loan Documents; and
(e)    the Collateral and the revenue therefrom shall continue to secure, and be
available to be applied against, the total Advances Outstanding.
Borrower shall execute and deliver to Lender from time to time, promptly after
the request of Lender, a severance agreement and such other documents as Lender
shall request in order to effect the severance described above, all in form and
substance reasonably satisfactory to Lender. Borrower hereby absolutely and
irrevocably appoints Lender as its true and lawful attorney, coupled with an
interest, in its name and stead to make and execute all documents necessary or
desirable to effect the aforesaid severance, Borrower ratifying all that its
said attorney shall do by virtue thereof; provided, however, Lender shall not
make or execute any such documents under such power until three (3) days after
notice has been given to Borrower by Lender of Lender’s intent to exercise its
rights under such power. Borrower shall be obligated to pay any costs or
expenses incurred in connection with the preparation, execution, recording, or
filing of the Severed Loan Documents, and the Severed Loan Documents shall not
contain any representations, warranties, or covenants not contained in the Loan
Documents and any such representations and warranties contained in the Severed
Loan Documents will be given by Borrower only as of the date last given.

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ARTICLE 15    
MISCELLANEOUS
Section 15.01    Choice of Law; Consent to Jurisdiction.
Notwithstanding anything in the Notes, the Security Documents, or any of the
other Loan Documents to the contrary, each of the terms and provisions, and
rights and obligations of Borrower under this Master Agreement and the Notes and
the other Loan Documents, shall be governed by, interpreted, construed, and
enforced pursuant to and in accordance with the laws of the District of Columbia
(excluding the law applicable to conflicts or choice of law) except to the
extent of procedural and substantive matters relating only to the creation,
perfection, and foreclosure of liens and security interests, and enforcement of
the rights and remedies, against the Mortgaged Properties, which matters shall
be governed by the laws of the jurisdiction in which a Mortgaged Property is
located, the perfection, the effect of perfection and non-perfection and
foreclosure of security interests on personal property, which matters shall be
governed by the laws of the jurisdiction determined by the choice of law
provisions of the Uniform Commercial Code in effect for the jurisdiction in
which any Borrower is organized. Borrower agrees that any controversy arising
under or in relation to the Notes, the Security Documents (other than the
Security Instruments), or any other Loan Document shall be, except as otherwise
provided herein, litigated in the District of Columbia. The local and federal
courts and authorities with jurisdiction in the District of Columbia shall,
except as otherwise provided herein, have jurisdiction over all controversies
which may arise under or in relation to the Loan Documents, including those
controversies relating to the execution, jurisdiction, breach, enforcement, or
compliance with the Notes, the Security Documents (other than the Security
Instruments), or any other issue arising under, relating to, or in connection
with any of the Loan Documents. Borrower irrevocably consents to service,
jurisdiction, and venue of such courts for any litigation arising from the
Notes, the Security Documents, or any of the other Loan Documents, and waives
any other venue to which it might be entitled by virtue of domicile, habitual
residence, or otherwise. Nothing contained herein, however, shall prevent Lender
from bringing any suit, action, or proceeding or exercising any rights against
Borrower and against the collateral in any other jurisdiction. Initiating such
suit, action, or proceeding or taking such action in any other jurisdiction
shall in no event constitute a waiver of the agreement contained herein that the
laws of the District of Columbia shall govern the rights and obligations of
Borrower and Lender as provided herein or the submission herein by Borrower to
personal jurisdiction within the District of Columbia.
Section 15.02    Waiver of Jury Trial.
TO THE MAXIMUM EXTENT PERMITTED BY APPLICABLE LAW, EACH OF BORROWER AND LENDER
(a) COVENANTS AND AGREES NOT TO ELECT A TRIAL BY JURY WITH RESPECT TO ANY ISSUE
ARISING OUT OF THIS MASTER AGREEMENT OR ANY OTHER LOAN DOCUMENT, OR THE
RELATIONSHIP BETWEEN THE PARTIES AS BORROWER AND LENDER, THAT IS TRIABLE OF
RIGHT BY A JURY AND (b) WAIVES ANY RIGHT TO TRIAL BY JURY WITH RESPECT TO SUCH
ISSUE TO THE EXTENT THAT ANY SUCH RIGHT EXISTS NOW OR IN THE FUTURE. THIS WAIVER
OF RIGHT TO TRIAL BY JURY IS SEPARATELY GIVEN BY EACH PARTY, KNOWINGLY

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AND VOLUNTARILY WITH THE BENEFIT OF COMPETENT LEGAL COUNSEL
Section 15.03    Notice.
(a)    Process of Serving Notice.
Except as otherwise set forth herein or in any other Loan Document, all notices
under this Master Agreement and any other Loan Document shall be:
(1)    in writing and shall be:
(A)    delivered, in person;
(B)    mailed, postage prepaid, either by registered or certified delivery,
return receipt requested;
(C)    sent by overnight courier; or
(D)    sent by electronic mail with originals to follow by overnight courier;
(2)    addressed to the intended recipient at Borrower’s Notice Address and
Lender’s Notice Address, as applicable; and
(3)    deemed given on the earlier to occur of:
(A)    the date when the notice is received by the addressee; or
(B)    if the recipient refuses or rejects delivery, the date on which the
notice is so refused or rejected, as conclusively established by the records of
the United States Postal Service or such express courier service.
(b)    Change of Address.
Any party to this Master Agreement may change the address to which notices
intended for it are to be directed by means of notice given to the other parties
identified on the Summary of Master Terms in accordance with this Section 15.03
(Notice).
(c)    Default Method of Notice.
Any required notice under this Master Agreement or any other Loan Document which
does not specify how notices are to be given shall be given in accordance with
this Section 15.03 (Notice).
(d)    Receipt of Notices.
Neither Borrower nor Lender shall refuse or reject delivery of any notice given
in

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accordance with this Master Agreement. Each party is required to acknowledge, in
writing, the receipt of any notice upon request by the other party.
(e)    Property Operator Notices.
Borrower acknowledges and agrees that Borrower solely shall be responsible for
(1) causing Property Operator to comply with any notice received by Borrower
from Lender, and (2) promptly providing Lender with copies of notices received
by Borrower from Property Operator. Borrower’s compliance with or failure to act
as an intermediary as described in this Section 15.03(e) (Property Operator
Notices) shall not relieve Borrower from its obligations under this Master
Agreement, nor shall it constitute a defense or excuse for nonperformance by
Borrower, Property Operator, or any Guarantor, as applicable. Lender shall have
no obligation to provide any notice to Property Operator unless and until Lender
has taken ownership or control of the Mortgaged Property, or in connection with
Lender’s exercise of the power of attorney granted herein, and then only as
required by the Loan Documents or the Facility Operating Agreement.
Section 15.04    Successors and Assigns Bound; Sale of Advances.
(a)    Binding Agreement.
This Master Agreement shall bind, and the rights granted by this Master
Agreement shall inure to, the successors and assigns of Lender and the permitted
successors and assigns of Borrower. However, a Transfer not permitted by this
Master Agreement shall be an Event of Default and shall be void ab initio.
(b)    Sale of Advances; Change of Servicer.
Nothing in this Master Agreement shall limit Lender’s (including its successors
and assigns) right to sell or transfer the Advances or any interest in the
Advances. The Advances or a partial interest in the Advances (together with this
Master Agreement and the other Loan Documents) may be sold one or more times
without prior written notice to Borrower. A sale may result in a change of the
Loan Servicer.
Section 15.05    Counterparts.
This Master Agreement may be executed in any number of counterparts with the
same effect as if the parties hereto had signed the same document and all such
counterparts shall be construed together and shall constitute one instrument.
Section 15.06    Intentionally Deleted.
Section 15.07    Relationship of Parties; No Third Party Beneficiary.
(a)    Solely Creditor and Debtor.
The relationship between Lender and Borrower shall be solely that of creditor
and debtor,

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respectively, and nothing contained in this Master Agreement shall create any
other relationship between Lender and Borrower, nor between Lender and Property
Operator. Nothing contained in this Master Agreement shall constitute Lender as
a joint venturer, partner, or agent of Borrower or Property Operator, or render
Lender liable for any debts, obligations, acts, omissions, representations, or
contracts of Borrower or Property Operator.
(b)    No Third Party Beneficiaries.
No creditor of any party to this Master Agreement and no other Person shall be a
third party beneficiary of this Master Agreement or any other Loan Document or
any account created or contemplated under this Master Agreement or any other
Loan Document. Nothing contained in this Master Agreement shall be deemed or
construed to create an obligation on the part of Lender to any third party nor
shall any third party have a right to enforce against Lender any right that
Borrower may have under this Master Agreement. Without limiting the foregoing:
(1)    any Servicing Arrangement between Lender and any Loan Servicer shall
constitute a contractual obligation of such Loan Servicer that is independent of
the obligation of Borrower for the payment of the Indebtedness;
(2)    Borrower shall not be a third party beneficiary of any Servicing
Arrangement; and
(3)    no payment by the Loan Servicer under any Servicing Arrangement will
reduce the amount of the Indebtedness.
Section 15.08    Severability; Entire Agreement; Amendments.
The invalidity or unenforceability of any provision of this Master Agreement or
any other Loan Document shall not affect the validity or enforceability of any
other provision of this Master Agreement or of any other Loan Document, all of
which shall remain in full force and effect, including the Guaranty. This Master
Agreement contains the complete and entire agreement among the parties as to the
matters covered, rights granted and the obligations assumed in this Master
Agreement. This Master Agreement may not be amended or modified except by
written agreement signed by the parties hereto.
Section 15.09    Construction.
(a)    The captions and headings of the sections of this Master Agreement and
the Loan Documents are for convenience only and shall be disregarded in
construing this Master Agreement and the Loan Documents.
(b)    Any reference in this Master Agreement to an “Exhibit” or “Schedule” or a
“Section” or an “Article” shall, unless otherwise explicitly provided, be
construed as referring, respectively, to an Exhibit or Schedule attached to this
Master Agreement or to a Section or Article of this Master Agreement.

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(c)    Any reference in this Master Agreement to a statute or regulation shall
be construed as referring to that statute or regulation as amended from time to
time.
(d)    Use of the singular in this Master Agreement includes the plural and use
of the plural includes the singular.
(e)    As used in this Master Agreement, the term “including” means “including,
but not limited to” or “including, without limitation,” and is for example only
and not a limitation.
(f)    Whenever Borrower’s knowledge is implicated in this Master Agreement or
the phrase “to Borrower’s knowledge” or a similar phrase is used in this Master
Agreement, Borrower’s knowledge or such phrase(s) shall be interpreted to mean
to the best of Borrower’s knowledge after reasonable and diligent inquiry and
investigation.
(g)    Unless otherwise provided in this Master Agreement, if Lender’s approval,
designation, determination, selection, estimate, action, or decision is
required, permitted, or contemplated hereunder, such approval, designation,
determination, selection, estimate, action, or decision shall be made in
Lender’s sole and absolute discretion.
(h)    All references in this Master Agreement to a separate instrument or
agreement shall include such instrument or agreement as the same may be amended
or supplemented from time to time pursuant to the applicable provisions thereof.
(i)    “Lender may” shall mean at Lender’s discretion, but shall not be an
obligation.
(j)    Any references in this Master Agreement to a Senior Housing Facility
shall refer to the Mortgaged Property identified on the Summary of Master Terms
including the Seniors Housing Facility Licensing Designation.
(k)    Each reference to “tenant” or “tenants” in the Loan Documents shall be
interpreted to mean “subtenant” or “subtenants” where the context so indicates.
Section 15.10    Loan Servicing.
All actions regarding the servicing of the Advances, including the collection of
payments, the giving and receipt of notice, inspections of the Mortgaged
Properties, inspections of books and records, and the granting of consents and
approvals, may be taken by the Loan Servicer unless Borrower receives notice to
the contrary. If Borrower receives conflicting notices regarding the identity of
the Loan Servicer or any other subject, any such notice from Lender shall
govern. The Loan Servicer may change from time to time (whether related or
unrelated to a sale of the Advances). If there is a change of the Loan Servicer,
Borrower will be given notice of the change.
Section 15.11    Disclosure of Information.
Lender may furnish information regarding Borrower, Property Operator, Key
Principal or Guarantor or the Mortgaged Properties to third parties with an
existing or prospective interest in

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the servicing, enforcement, evaluation, performance, purchase, or securitization
of the Advances, including trustees, master servicers, special servicers, rating
agencies, and organizations maintaining databases on the underwriting and
performance of multifamily mortgage loans. Borrower irrevocably waives any and
all rights it may have under Applicable Law to prohibit such disclosure,
including any right of privacy.
Section 15.12    Waiver; Conflict.
No specific waiver of any of the terms of this Master Agreement shall be
considered as a general waiver. If any provision of this Master Agreement is in
conflict with any provision of any other Loan Document, the provision contained
in this Master Agreement shall control.
Section 15.13    Intentionally Deleted.
Section 15.14    No Reliance.
Borrower acknowledges, represents, and warrants that:
(a)    it understands the nature and structure of the transactions contemplated
by this Master Agreement and the other Loan Documents;
(b)    it is familiar with the provisions of all of the documents and
instruments relating to such transactions;
(c)    it understands the risks inherent in such transactions, including the
risk of loss of all or any part of any Mortgaged Property;
(d)    it has had the opportunity to consult counsel; and
(e)    it has not relied on Lender for any guidance or expertise in analyzing
the financial or other consequences of the transactions contemplated by this
Master Agreement or any other Loan Document or otherwise relied on Lender in any
manner in connection with interpreting, entering into, or otherwise in
connection with this Master Agreement, any other Loan Document, or any of the
matters contemplated hereby or thereby.
Section 15.15    Subrogation.
If, and to the extent that, the proceeds of any Advance are used to pay,
satisfy, or discharge any obligation of Borrower or Property Operator for the
payment of money that is secured by a pre-existing mortgage, deed of trust, or
other lien encumbering any Mortgaged Property, such proceeds shall be deemed to
have been advanced by Lender at Borrower’s request, and Lender shall be
subrogated automatically, and without further action on its part, to the rights,
including lien priority, of the owner or holder of the obligation secured by
such prior lien, whether or not such prior lien is released.

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Section 15.16    Counting of Days.
Except where otherwise specifically provided, any reference in this Master
Agreement to a period of “days” means calendar days, not Business Days. If the
date on which Borrower is required to perform an obligation under this Master
Agreement is not a Business Day, Borrower shall be required to perform such
obligation by the Business Day immediately preceding such date; provided,
however, in respect of any Payment Date, or if the Maturity Date is other than a
Business Day, Borrower shall be obligated to make such payment by the Business
Day immediately following such date.
Section 15.17    Revival and Reinstatement of Indebtedness.
If the payment of all or any part of the Indebtedness by Borrower, Property
Operator, Guarantor, or any other Person, or the transfer to Lender of any
collateral or other property should for any reason subsequently be declared to
be void or voidable under any state or federal law relating to creditors’
rights, including provisions of the Insolvency Laws relating to a Voidable
Transfer, and if Lender is required to repay or restore, in whole or in part,
any such Voidable Transfer, or elects to do so upon the advice of its counsel,
then the amount of such Voidable Transfer or the amount of such Voidable
Transfer that Lender is required or elects to repay or restore, including all
reasonable costs, expenses, and attorneys’ fees incurred by Lender in connection
therewith, and the Indebtedness shall be automatically revived, reinstated, and
restored by such amount and shall exist as though such Voidable Transfer had
never been made.
Section 15.18    Time is of the Essence.
Borrower agrees that, with respect to each and every obligation and covenant
contained in this Master Agreement and the other Loan Documents, time is of the
essence.
Section 15.19    Final Agreement.
THIS MASTER AGREEMENT ALONG WITH ALL OF THE OTHER LOAN DOCUMENTS REPRESENT THE
FINAL AGREEMENT BETWEEN THE PARTIES WITH RESPECT TO THE SUBJECT MATTER HEREOF
AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS OR SUBSEQUENT
ORAL AGREEMENTS. THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES. All
prior or contemporaneous agreements, understandings, representations, and
statements, oral or written, are merged into this Master Agreement and the other
Loan Documents. This Master Agreement, the other Loan Documents, and any of
their provisions may not be waived, modified, amended, discharged, or terminated
except by an agreement in writing signed by the party against which the
enforcement of the waiver, modification, amendment, discharge, or termination is
sought, and then only to the extent set forth in that agreement.
Section 15.20    Survival.
The representations, warranties, and covenants made by Borrower in this Master

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Agreement shall survive the execution and delivery of this Master Agreement and
other Loan Documents, regardless of any investigation made by Lender or Fannie
Mae.
Section 15.21    Assignments; Third Party Rights.
Lender may assign its rights and/or obligations under this Master Agreement
separately or together, without Borrower’s consent, only to Fannie Mae. Upon
assignment to Fannie Mae, Fannie Mae shall be permitted to further assign its
rights under this Master Agreement separately or together, without Borrower’s
consent. Fannie Mae shall have the right to hold, sell, or securitize the
Advances made hereunder without Borrower’s consent.
Section 15.22    Interpretation.
The parties hereto acknowledge that each party and their respective counsel have
participated in the drafting and revision of this Master Agreement and the Loan
Documents. Accordingly, the parties agree that any rule of construction that
disfavors the drafting party shall not apply in the interpretation of this
Master Agreement and the Loan Documents or any amendment or supplement or
Exhibit hereto or thereto.
[Remainder of Page Intentionally Blank]

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IN WITNESS WHEREOF, Borrower and Lender have signed and delivered this Master
Agreement under seal (where applicable) or have caused this Master Agreement to
be signed and delivered under seal (where applicable) by their duly authorized
representatives. Where Applicable Law so provides, Borrower and Lender intend
that this Master Agreement shall be deemed to be signed and delivered as a
sealed instrument.
BORROWER:
 
FIT REN Nohl Ranch LP,
FIT REN Park LP,
FIT REN Mirage Inn LP,
FIT REN The Gables LP,
FIT REN Paulin Creek LP,
FIT REN Ocean House LP,
FIT REN Oak Tree LP,
FIT REN Pacific Inn LP,
Each a Delaware limited partnership
 
By: FIT REN Holdings GP Inc., their general partner
 
By:    /s/ George T. Hicks            
Name:    George T. Hicks
Title:    Executive Vice President and Treasurer
 
 
AHC Purchaser, Inc.,
A Delaware corporation
 
By:    /s/ George T. Hicks            
Name:    George T. Hicks
Title:    Executive Vice President and Treasurer
 
ARC Scottsdale, LLC,
ARC Sweet Life Shawnee, LLC,
ARCLP Charlotte, LLC,
ARC Wilora Assisted Living, LLC,
Each a Tennessee limited liability company
 
By:    /s/ George T. Hicks            
Name:    George T. Hicks
Title:    Executive Vice President and Treasurer of each Borrower

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ARC Westlake Village, Inc.,
a Tennessee corporation
 
By:    /s/ George T. Hicks            
Name:    George T. Hicks
Title:    Executive Vice President and Treasurer
 
AHC Sterling House of Brighton, LLC
AHC Villas of the Atrium, LLC,
AHC Sterling House of Jacksonville, LLC,
AHC Sterling House of Panama City, LLC,
CMCP-Pinecastle, LLC,
AHC Sterling House of Port Charlotte, LLC,
AHC Sterling House of Punta Gorda, LLC,
AHC Sterling House of Venice, LLC,
CMCP-Roswell, LLC,
AHC Villas-Wynwood of River Place, LLC,
CMCP-Montrose, LLC,
AHC Villas-Wynwood of Courtyard Albany, LLC,
AHC Villas of Albany Residential, LLC,
AHC Wynwood of Rogue Valley, LLC,
CMCP-Club Hill, LLC,
AHC Sterling House of Corsicana, LLC,
Brookdale Cypress Station, LLC,
Brookdale Lakeway, LLC,
AHC Sterling House of Lewisville, LLC,
AHC Sterling House of Mansfield, LLC
Brookdale Northwest Hills, LLC,
AHC Sterling House of Weatherford, LLC,
CMCP-Williamsburg, LLC,
Each a Delaware limited liability company
 
By:    /s/ George T. Hicks            
Name:    George T. Hicks
Title:    Executive Vice President and Treasurer of each Borrower

 
 

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LENDER:

JONES LANG LASALLE MULTIFAMILY, LLC,
a Delaware limited liability company

By: /s/ Rhonda Peare    (SEAL)
Name: Rhonda Peare    
Title: Closing Coordinator    

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SCHEDULE 1 TO
MASTER CREDIT FACILITY AGREEMENT
Definitions Schedule
Capitalized terms used in this Master Agreement have the meanings given to such
terms in this Definitions Schedule.
“Accounts” has the meaning set forth in each Security Instrument.
“Accrued Interest” means unpaid interest, if any, on the Advances Outstanding
that has not been added to the unpaid principal balance of the Advances pursuant
to Section 2.03(b) (Capitalization of Accrued But Unpaid Interest) of this
Master Agreement.
“Acuity” means the type of housing and services categorized as Independent
Living, Assisted Living or Alzheimer’s/Dementia Care or Skilled Nursing provided
to residents at the Mortgaged Property.
“Addition” has the meaning set forth in Section 2.10(c) (Right to Add Additional
Mortgaged Properties as Collateral).
“Addition Request” means a written request, substantially in the form of Exhibit
D to this Master Agreement, to add Additional Mortgaged Properties to the
Collateral Pool as set forth in Section 2.10(c) (Right to Add Additional
Mortgaged Properties as Collateral).
“Additional Borrower” means the owner of an Additional Mortgaged Property, which
entity has been approved by Lender and becomes a Borrower under this Master
Agreement and the applicable Loan Documents, and its permitted successors and
assigns, which owner must demonstrate to the satisfaction of Lender that:
(a)    Additional Borrower is a Single Purpose entity;
(b)    any general partner of the Additional Borrower is a Single Purpose
entity;
(c)    Additional Borrower is directly or indirectly wholly-owned and Controlled
by Guarantor; and
(d)    Additional Borrower is not a Prohibited Person.
“Additional Due Diligence Fee Deposit” means the deposit made by Borrower to
Lender with respect to each proposed Additional Mortgaged Property in an amount
equal to $20,000 per Additional Mortgaged Property. On or prior to the
applicable Effective Date, Lender shall notify Borrower of the actual amount of
the Additional Due Diligence Fees and Borrower shall, on the Effective Date, pay
to Lender the remainder of such Additional Due Diligence Fees (if the actual
amount of the Additional Due Diligence Fees exceeds the deposit and the other
amounts previously paid to Lender by Borrower) or Lender shall promptly refund
to Borrower any amounts paid to Lender by Borrower in excess of the Additional
Due Diligence Fees (if the actual amount of the

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Additional Due Diligence Fees is less than the deposit and the other amounts
previously paid to Lender by Borrower).
“Additional Due Diligence Fees” means with respect to each proposed Additional
Mortgaged Property an amount equal to the actual costs of Lender’s due diligence
for such Additional Mortgaged Properties, including but not limited to third
party reports required by Lender plus a non-refundable $5,000 processing fee per
Additional Mortgaged Property payable by Borrower to Lender. Borrower shall pay
the Additional Due Diligence Fee Deposit towards the Additional Due Diligence
Fees.
“Additional Lender Repairs” means repairs of the type listed on the Required
Repair Schedule but not otherwise identified thereon that are determined
advisable by Lender to keep the Mortgaged Property in good order and repair
(ordinary wear and tear excepted) and in good marketable condition or to prevent
deterioration of the Mortgaged Property.
“Additional Lender Replacements” means replacements of the type listed on the
Required Replacement Schedule but not otherwise identified thereon that are
determined advisable by Lender to keep the Mortgaged Property in good order and
repair (ordinary wear and tear excepted) and in good marketable condition or to
prevent deterioration of the Mortgaged Property.
“Additional Mortgaged Property” means each Multifamily Residential Property
owned by Borrower or an Additional Borrower (either in fee simple or as tenant
under a ground lease meeting all of the Underwriting and Servicing Requirements)
and added to the Collateral Pool after the Initial Effective Date in connection
with an Addition or a Substitution pursuant to Section 2.10(c) (Right to Add
Additional Mortgaged Properties as Collateral) or Section 2.10(d) (Right to
Substitutions).
“Additional Origination Fee” means an origination fee equal to forty (40) basis
points (0.40%) multiplied by the Future Advance.
“Adjustable Rate” has the meaning set forth in the applicable Schedule of
Advance Terms.
“Advance” means a Variable Advance and/or a Fixed Advance.
“Advance Year” has the meaning set forth in the applicable Schedule of Advance
Terms.
“Affiliated Property Operator” means any Property Operator that is a Borrower
Affiliate, as identified in the Summary of Master Terms.
“Aggregate Debt Service Coverage Ratio” means, for any specified period, the
ratio (expressed as a percentage) of--
(a)    the Net Operating Income for the Mortgaged Properties for the preceding
number of months as determined pursuant to the Underwriting and Servicing
Requirements;
to
(b)    the Facility Debt Service for the specified period.

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“Aggregate Loan to Value Ratio” means, for any specified date, the ratio
(expressed as a percentage) of--
(a)    the Advances Outstanding on the specified date,
to
(b)    the sum of (i) the aggregate of the Valuations most recently obtained
prior to the specified date for all of the Mortgaged Properties, plus (ii) any
Substitution Deposit being held by Lender as of such specified date.
“Allocable Facility Amount” means the most recently determined amount of the
then Advances Outstanding allocated to a particular Mortgaged Property by Lender
in accordance with the Underwriting and Servicing Requirements and as required
by this Master Agreement.
“Allowed Change in Use” means a change during the Term of the Master Agreement
in the unit or bed Acuity composition at the Mortgaged Property not to exceed
ten percent (10%) of the total number of units or beds in place as of the date
the Mortgaged Property was added to the Collateral Pool.
“Alterations” has the meaning set forth in Section 6.02(f) (Alterations to any
Mortgaged Property).
“Alzheimer’s Property” means a Mortgaged Property with all units and beds
designed for residents with significant cognitive impairment resulting from
Alzheimer’s disease or other dementia, but which units and bed are not licensed
as skilled nursing beds.
“Amortization Period” means the period of thirty (30) years.
“Amortization Type” has the meaning set forth in the applicable Schedule of
Advance Terms.
“Applicable Index” means (a) with respect to any Variable Structured ARM
Advance, either One Month LIBOR or Three Month LIBOR as set forth in the
applicable Schedule of Advance Terms, or (b) with respect to any other Variable
Advance, the index pursuant to which the Adjustable Rate is determined, as set
forth in the applicable Schedule of Advance Terms.
“Applicable Law” means (a) all applicable provisions of all constitutions,
statutes, rules, regulations and orders of all governmental bodies, all
Governmental Approvals and all orders, judgments and decrees of all courts and
arbitrators, (b) all zoning, building, environmental and other laws, ordinances,
rules, regulations and restrictions of any Governmental Authority affecting the
ownership, management, use, operation, maintenance or repair of the Mortgaged
Properties, including the Americans with Disabilities Act (if applicable), the
Fair Housing Amendment Act of 1988 and Environmental Laws, (c) any building
permits or any conditions, easements, rights-of-way, covenants, restrictions of
record or any recorded or unrecorded agreement affecting or concerning any
Mortgaged Property, planned development permits, condominium declarations, and
reciprocal easement and regulatory agreements with any Governmental Authority,
(d) all laws, ordinances, rules and regulations, whether in the form of rent
control, rent stabilization or otherwise, that limit or impose conditions on the
amount of rent that may be collected from the units of a

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Mortgaged Property, and (e) requirements of insurance companies or similar
organizations, affecting the operation or use of any Mortgaged Property or the
consummation of the transactions to be effected by this Master Agreement or any
of the other Loan Documents.
“Appraisal” means an appraisal of Multifamily Residential Property conforming to
the Underwriting and Servicing Requirements.
“Appraised Value” means the value set forth in an Appraisal.
“Assisted Living Property” means a Mortgaged Property comprised of one or more
assisted living units which offers services limited to non-medical personal
care, including support for activities of daily living such as support for
medication management and assistance with bathing, dressing, toileting,
ambulating, eating, and other similar activities. An Assisted Living Property
may also contain up to fifty percent (50%) Independent Living units and/or
Alzheimer Care Units.
“Bank Secrecy Act” means the Bank Secrecy Act of 1970, as amended (e.g.,
31 U.S.C. Sections 5311-5330).
“Bankruptcy Code” means Title 11 of the United States Code entitled “Bankruptcy”
as now and hereafter in effect, or any successor statute.
“Bankruptcy Event” means any one or more of the following:
(a)    the commencement, filing or continuation of a voluntary case or
proceeding under one or more of the Insolvency Laws by any Borrower Entity or
Identified Party seeking to take advantage of any other laws, domestic or
foreign, relating to bankruptcy, insolvency, reorganization, debt adjustment,
winding up or composition or adjustment of debts;
(b)    the acknowledgment in writing by any Borrower Entity or Identified Party
(other than to Lender in connection with a workout) that it is unable to pay its
debts generally as they mature;
(c)    the making of a general assignment for the benefit of creditors by any
Borrower Entity or Identified Party;
(d)    the commencement, filing or continuation of an involuntary case or
proceeding under one or more Insolvency Laws against any Borrower Entity or
Identified Party;
(e)    the appointment of a receiver (other than a receiver appointed at the
direction or request of Lender under the terms of the Loan Documents),
liquidator, custodian, sequestrator, trustee or other similar officer who
exercises Control over Borrower or any substantial part of the assets of any
Borrower Entity or Identified Party; or
(f)    any action by a Borrower Entity or Identified Party for the purpose of
effecting any of the foregoing, provided, however, that any proceeding or case
under (d) or (e) above shall not be a Bankruptcy Event until the
ninetieth (90th) day after filing (if not earlier dismissed) so long as such
proceeding or case occurred without the consent, encouragement, active
participation or

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the failure to object in a timely and appropriate manner by any Borrower Entity,
Affiliated Property Operator, or Identified Party (in which event such case or
proceeding shall be a Bankruptcy Event immediately).
“Borrower” means individually (and jointly and severally if more than one), the
Initial Borrower and any Additional Borrower becoming a party to this Master
Agreement and any other Loan Documents, together with their permitted successors
and assigns.
“Borrower Affiliate” means:
(a)    any Person that owns any direct ownership interest in any Borrower
Entity, Identified Party or Affiliated Property Operator but excluding any
Person directly or indirectly owning any public stock of Guarantor with no other
direct or indirect ownership interest in Borrower;
(b)    any Person that indirectly owns, with the power to vote, twenty
percent (20%) or more of the ownership interests in any Borrower Entity,
Affiliated Property Operator, or Identified Party;
(c)    any Person Controlled by, under common Control with, or which Controls,
any Borrower Entity, Affiliated Property Operator, or Identified Party;
(d)    any entity in which any Borrower Entity, Affiliated Property Operator, or
Identified Party directly or indirectly owns, with the power to vote, twenty
percent (20%) or more of the ownership interests in such entity; or
(e)    any other individual that is related (to the third degree of
consanguinity) by blood or marriage to any Borrower Entity, Affiliated Property
Operator, or Identified Party.
“Borrower Agent” means Brookdale Senior Living Inc., a Delaware corporation.
“Borrower Entity” means, individually and collectively, Borrower, Guarantor and
Key Principal.
“Borrower Requested Repairs” means repairs not listed on the Required Repair
Schedule requested by Borrower to be reimbursed from the Repairs Escrow Account
and determined advisable by Lender to keep the Mortgaged Property in good order
and repair and in a good marketable condition or to prevent deterioration of the
Mortgaged Property.
“Borrower Requested Replacements” means replacements not listed on the Required
Replacement Schedule requested by Borrower to be reimbursed from the Replacement
Reserve Account and determined advisable by Lender to keep the Mortgaged
Property in good order and repair and in a good marketable condition or to
prevent deterioration of the Mortgaged Property.
“Borrower’s General Business Address” has the meaning set forth in the Summary
of Master Terms.
“Borrower’s Notice Address” has the meaning set forth in the Summary of Master
Terms.

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“Business Day” means any day other than (a) a Saturday, (b) a Sunday, (c) a day
on which Lender is not open for business, or (d) a day on which the Federal
Reserve Bank of New York is not open for business.
“Calendar Quarter” means, with respect to any year, any of the following
three (3) month periods: (a) January-February-March; (b) April-May-June; (c)
July-August-September; and (d) October-November-December.
“Calendar Year” means the twelve (12) month period from the first day of January
to and including the last day of December, and each twelve (12) month period
thereafter.
“Cap Security Agreement” means, individually and collectively, with respect to
any Interest Rate Cap, a reserve, hedge assignment and security agreement
between Borrower and Lender, for the benefit of Lender in the form required by
Fannie Mae from time to time, which will be issued by Borrower to Lender
concurrently with the funding of a Variable Advance requiring an Interest Rate
Cap.
“Capitalization Rate” means, for each Mortgaged Property, a rate selected by
Lender for use in determining the Valuations.
“Cash Collateral Account” means the cash collateral account established pursuant
to the Cash Collateral Agreement.
“Cash Collateral Agreement” means a cash collateral pledge, security and custody
agreement in the form approved by Fannie Mae by and among Fannie Mae, Borrower
and a collateral agent for Fannie Mae, as the same may be amended, modified or
supplemented from time to time.
“Collateral” means the Mortgaged Properties and other collateral from time to
time or at any time encumbered by the Security Instruments, or any other
property securing Borrower’s obligations under the Loan Documents.
“Collateral Account” means any account designated by Lender as such pursuant to
a Collateral Agreement or as established pursuant to this Master Agreement,
including the Reserve/Escrow Account and any Cash Collateral Account.
“Collateral Account Funds” means, collectively, the funds on deposit in any or
all of the Collateral Accounts, including the Reserve/Escrow Account Funds and
any funds in any Cash Collateral Account.
“Collateral Agreement” means any separate agreement between Borrower and Lender
for the establishment of any other fund, reserve or account.
“Collateral Event” means, individually and collectively, a Release,
Substitution, Addition, Future Advance, and/or Conversion.
“Collateral Pool” means all of the Collateral.

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“Completion Period” has the meaning set forth in the Summary of Master Terms.
“Compliance Certificate” means a certificate of Borrower substantially in the
form of Exhibit K to this Master Agreement.
“Condemnation Action” has the meaning set forth in the Security Instrument.
“Condominium” has the meaning set forth in the Security Instrument for the Ann
Arbor Mortgaged Property.
“Condominium Act” has the meaning set forth in the Security Instrument for the
Ann Arbor Mortgaged Property.
“Condominium Documents” has the meaning set forth in the Security Instrument for
the Ann Arbor Mortgaged Property.
“Confirmation of Environmental Indemnity Agreement” means a confirmation of the
Environmental Indemnity Agreement executed by Borrower in connection with any
Request after the Initial Effective Date, substantially in the form of Exhibit J
to this Master Agreement.
“Confirmation of Guaranty” means a confirmation of the Guaranty executed by
Guarantor in connection with any Request after the Initial Effective Date,
substantially in the form of Exhibit I to this Master Agreement.
“Confirmation of Obligations” means a Confirmation of Obligations executed by
Borrower and Guarantor in connection with any Request after the Initial
Effective Date, pursuant to which Borrower and Guarantor confirm their
obligations under the Loan Documents substantially in the form of Exhibit M to
this Master Agreement.
“Contract” means any contract or other agreement for the provision of goods or
services at or otherwise in connection with the operation, use or maintenance of
the Mortgaged Property, excluding the Facility Operating Agreement, National
Contracts, and contracts for the provision of utilities, cable and landscaping
services, and including cash deposited to secure performance by parties of their
obligations.
“Contribution Agreement” means the Contribution Agreement by and among Initial
Borrower and each Additional Borrower, required by Lender and satisfying
Lender’s requirements, as the same may be amended, restated, modified or
supplemented from time to time.
“Control” (including with correlative meanings, such as “Controlling,”
“Controlled by” and “under common Control with”) means, as applied to any
entity, the possession, directly or indirectly, of the power to direct or cause
the direction of the management and operations of such entity, whether through
the ownership of voting securities or other ownership interests, by contract or
otherwise.
As used herein, a “Change of Control” means (a) Guarantor ceases to Control
Borrower or Affiliated Property Operator or any Person that directly or
indirectly Controls Borrower or Affiliated Property Operator; (b) the Ownership
Interests of Guarantor cease to be publicly

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traded; or (c) the replacement (other than solely by reason of retirement, death
or disability) of more than fifty percent (50%) (or such lesser percentage as is
required for decision-making by the board of directors or an equivalent
governing body) of the members of the board of directors (or an equivalent
governing body) of Guarantor over a one-year period from the directors who
constituted such board of directors at the beginning of such period and such
replacement shall not have been approved by a vote of at least a majority of the
board of directors of the Guarantor, as applicable, then still in office who
either were members of such board of directors at the beginning of such one-year
period or whose election as members of the board of directors was previously so
approved (it being understood and agreed that in the case of any entity governed
by a trustee, board of managers, or other similar governing body, the foregoing
clause (b) shall apply thereto by substituting such governing body and the
members thereof for the board of directors and members thereof, respectively).
“Conversion” means the conversion of all or a portion of a Variable Note to a
Fixed Note pursuant to the Conversion Schedule.
“Conversion Amendment” means an amendment to this Master Agreement and the
appropriate Schedules reflecting the Conversion of all or any portion of a
Variable Note to a Fixed Note as set forth in Section 2.10(a) (Conversion from
Variable Note to Fixed Note).
“Conversion Availability Period” means with respect to a Conversion of any
applicable Variable Advance, the date beginning on the first day of the month
following twelve (12) complete months after the Effective Date of such Variable
Advance and ending on the earlier of (a) the last day of the fourth month prior
to the Maturity Date of such Variable Advance or (b) the first day of the month
following the date ten (10) years after the Initial Effective Date.
“Conversion Documents” means the Conversion Amendment, together with an
amendment to each Security Document if required by Lender and other applicable
Loan Documents, in form and substance satisfactory to Lender, reflecting the
Conversion of a Variable Note to a Fixed Note pursuant to Section 2.10(a)
(Conversion from Variable Note to Fixed Note).
“Conversion Fee” means $30,000 per Conversion Request.
“Conversion Request” means a written request, substantially in the form of
Exhibit B to this Master Agreement, to convert all or any portion of a Variable
Note to a Fixed Note pursuant to Section 2.10(a) (Conversion from Variable Note
to Fixed Note).
“Conversion Schedule” means Schedule 9 attached to this Master Agreement.
“Coverage and LTV Tests” means, for any specified date, each of the following
financial tests:
(a)    The Aggregate Debt Service Coverage Ratio is not less than (i) with
respect to the amount of the Fixed Advances 1.40:1.0 and (ii) with respect to
the amount of the Variable Advances 1.20:1.0.

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(b)    The Aggregate Loan to Value Ratio does not exceed seventy percent (70%).
“Credit Score” means a numerical value or a categorization derived from a
statistical tool or modeling system used to measure credit risk and predict the
likelihood of certain credit behaviors, including default.
“Current Index” has the meaning set forth in applicable Schedule of Advance
Terms.
“Debt Service Amounts” means the Monthly Debt Service Payments and all other
amounts payable under this Master Agreement, the Note, the Security Instrument
or any other Loan Document.
“Debt Service Coverage Ratio” means, for any Mortgaged Property for any
specified period, the ratio (expressed as a percentage) of --
(a)    the Net Operating Income for the specified period for the preceding
number of months as determined pursuant to the Underwriting and Servicing
Requirements;
to
(b)    the Facility Debt Service for the specified period, assuming, for the
purpose of calculating the Facility Debt Service of this definition, that
Advances Outstanding shall be the Allocable Facility Amount, in each case, for
the subject Mortgaged Property.
“Default Rate” means an interest rate equal to the lesser of:
(a)    the sum of the Interest Rate plus four (4) percentage points; or
(b)    the maximum interest rate which may be collected from Borrower under
Applicable Law.
“Definitions Schedule” means this Schedule 1 (Definitions Schedule – General) to
this Master Agreement.
“Depositary Agreement” means, individually and together the Government
Receivables Depositary Agreement and the Government Receivables Collection
Account Agreement.
“Economic Sanctions” means any economic or financial sanction administered or
enforced by the United States Government (including, without limitation, those
administered by OFAC at
http://www.treasury.gov/about/organizational-structure/offices/Pages/Office-of-Foreign-Assets-Control.aspx),
the U.S. Department of Commerce, or the U.S. Department of State.
“Effective Date” means the Initial Effective Date and each date after the
Initial Effective Date on which the funding or other transaction requested in a
Request takes place.
“Employee Benefit Plan” means a plan described in Section 3(3) of ERISA,
regardless of whether the plan is subject to ERISA.

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“Enforcement Costs” has the meaning set forth in the Security Instrument.
“Environmental Indemnity Agreement” means that certain Environmental Indemnity
Agreement dated as of the Effective Date made by Borrower to and for the benefit
of Lender, as the same may be amended, restated, replaced, supplemented, or
otherwise modified from time to time.
“Environmental Inspections” has the meaning set forth in the Environmental
Indemnity Agreement.
“Environmental Laws” has the meaning set forth in the Environmental Indemnity
Agreement.
“ERISA” means the Employee Retirement Income Security Act of 1974, as amended
from time to time and the regulations promulgated thereunder.
“ERISA Affiliate” shall mean, with respect to Borrower any entity that, together
with Borrower would be treated as a single employer under Section 414(b) or (c)
of the Internal Revenue Code, or Section 4001(a)(14) of ERISA, or the
regulations thereunder.
“ERISA Plan” means any employee pension benefit plan within the meaning of
Section 3(2) of ERISA (or related trust) that is subject to the requirements of
Title IV of ERISA, Sections 430 or 431 of the Internal Revenue Code, or
Sections 302, 303, or 304 of ERISA, which is maintained or contributed to by
Borrower or its ERISA Affiliates.
“Event of Default” means the occurrence of any event listed in Section 14.01
(Events of Default).
“Exceptions to Representations and Warranties Schedule” means that certain
Schedule 16 (Exceptions to Representations and Warranties) to this Master
Agreement.
“Experience Eligibility Requirements” means any Person, individually or together
with its Affiliates, that: (a) (i) has at least seven (7) years’ experience in
the ownership, operation or management of senior housing communities similar to
the Mortgaged Properties, and (ii) has, for at least five (5) years within the
last ten (10) years prior to the proposed Transfer, owned, operated or managed
at least (x) twenty (20) senior housing communities similar to the Mortgaged
Properties or (y) at least ten thousand (10,000), in the aggregate, individual
independent, assisted-living, memory care/Alzheimer’s, or skilled nursing units;
or (b) has employees in senior management with the experience described in
clause (a) above that is responsible for overseeing such Person’s investment
(directly or indirectly) in the Mortgaged Properties; or (c) engages a
reputable, third party advisor or asset management firm with the experience
described in clause (a) above to oversee and provide advice to such Person with
respect to such Person’s investment (directly or indirectly) in the Mortgaged
Properties.
“Facility Debt Service” means, as of any date, for all purposes other than
determining the Strike Rate, the sum of the amount of interest and principal
amortization that would be payable during the applicable period determined by
Lender immediately succeeding the date of determination, except that:

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(a)    each Variable Structured ARM Advance to be obtained shall be deemed to
require payments equal to the sum of (1) level monthly payments of principal and
interest (with the interest rate calculated as (A) the Applicable Index, plus
(B) the Margin (or until rate locked, the indicative pricing, as determined
pursuant to the Underwriting and Servicing Requirements), plus (C) a stressed
underwriting margin of 300 basis points (3.00%) or such lower stressed
underwriting margin determined pursuant to the Underwriting and Servicing
Requirements), in an amount necessary to fully amortize the original principal
amount of the Variable Structured ARM Advance over the Amortization Period, plus
(2) the Monthly Cap Escrow Payment;
(b)    when an Interest Rate Cap is required under this Master Agreement with
respect to each Variable Structured ARM Advance Outstanding:
(1)     where an amortizing Interest Rate Cap has been purchased and is then
effective, such Advance shall be deemed to require payments equal to the sum of
(A) level monthly payments of principal and interest (with the interest rate
calculated as (i) the Strike Rate applicable to such Advance, plus (ii) the
Margin applicable to such Advance), in an amount necessary to fully amortize the
original principal amount of the Variable Structured ARM Advance over the
Amortization Period, plus (B) any Monthly Cap Escrow Payment applicable to such
Advance; and
(2)     where an interest-only Interest Rate Cap has been purchased and is then
effective, such Advance shall be deemed to require payments equal to the sum of
(A) level monthly payments of interest (with the interest rate calculated as (i)
the Strike Rate applicable to such Advance, plus (ii) the Margin applicable to
such Advance), plus (B) any Monthly Cap Escrow Payment applicable to such
Advance;
(c)     when an Interest Rate Cap is not required under this Master Agreement,
each Variable Structured ARM Advance Outstanding shall be deemed to require
payments equal to the sum of (1) level monthly payments of principal and
interest (with the interest rate calculated as (A) the Strike Rate applicable to
such Advance, plus (B) the Margin applicable to such Advance), in an amount
necessary to fully amortize the original principal amount of the Variable
Structured ARM Advance over the Amortization Period), plus (2) any Monthly Cap
Escrow Payment;
(d)     each Fixed Advance to be obtained or Variable Advance to be converted
shall be deemed to require level monthly payments of principal and interest (at
an interest rate equal to the sum of the base United States Treasury Index Rate
for securities having a maturity substantially similar to the maturity of the
Fixed Advance, plus the Fixed Fee (or until rate locked, the estimated Fixed Fee
as determined pursuant to the Underwriting and Servicing Requirements)) in an
amount necessary to fully amortize the original principal amount of the Fixed
Advance over the Amortization Period; and
(e)     each Fixed Advance Outstanding shall be deemed to require level monthly
payments of principal and interest (at the Interest Rate for such Fixed Advance
as set forth in

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the Schedule of Advance Terms) in an amount necessary to fully amortize the
original principal amount of such Fixed Advance over the Amortization Period.
“Facility Operating Agreement” means, individually and collectively, any of an
Operating Lease, Sublease, Management Agreement or any other agreement setting
forth the responsibilities for the operation, management, maintenance or
administration of any Mortgaged Property as a Seniors Housing Facility.
“Facility Year” means the twelve (12) month period from the first day of the
first calendar month after the Initial Effective Date to and including the last
day before the first anniversary of the Initial Effective Date, and each
twelve (12) month period thereafter.
“Fannie Mae” means the corporation duly organized and existing under the laws of
the United States.
“First Anniversary” means the date that is the first day of the month following
the date one (1) year after the Initial Effective Date.
“First Payment Date” has the meaning set forth in the applicable Schedule of
Advance Terms.
“First Principal and Interest Payment Date” has the meaning set forth in the
applicable Schedule of Advance Terms.
“Fixed Advance” means a fixed rate loan made by Lender to Borrower under this
Master Agreement evidenced by a Fixed Note.
“Fixed Fee” means, subject to the provisions of the Conversion Schedule, if
applicable, for any Fixed Advance, the number of basis points per annum
determined at the time of funding of such Fixed Advance by Lender as the Fixed
Fee for such Fixed Advance.
“Fixed Note” means the promissory note (together with all schedules, riders,
allonges, addenda, renewals, extensions, amendments and modifications thereto),
which will be issued by Borrower to Lender, concurrently with the funding of
each Fixed Advance, and which promissory note will be the same or substantially
similar in form to the then current form of promissory note utilized by Fannie
Mae for fixed rate loans with the applicable type of loan execution.
“Fixed Monthly Principal Component” has the meaning set forth in the applicable
Schedule of Advance Terms.
“Fixed Rate” has the meaning set forth in the applicable Schedule of Advance
Terms.
“Fixtures” has the meaning set forth in the Security Instrument.
“Force Majeure” shall mean acts of God, acts of war, civil disturbance,
governmental action (including the revocation or refusal to grant licenses or
permits, where such revocation or refusal is not due to the fault of Borrower),
strikes, lockouts, fire, unavoidable casualties or any other causes

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beyond the reasonable control of Borrower (other than lack of financing), and of
which Borrower shall have notified Lender in writing within ten (10) days after
its occurrence.
“Foreclosure Event” means:
(a)    foreclosure under the Security Instrument;
(b)    any other exercise by Lender of rights and remedies (whether under the
Security Instrument or under Applicable Law, including Insolvency Laws) as
holder of the Note and/or the Security Instrument, as a result of which Lender
(or its designee or nominee) or a third party purchaser becomes owner of a
Mortgaged Property;
(c)    delivery by Borrower to Lender (or its designee or nominee) of a deed or
other conveyance of Borrower’s interest in a Mortgaged Property in lieu of any
of the foregoing; or
(d)    in Louisiana, any dation en paiement.
“Future Advance” means an Advance made after the Initial Effective Date pursuant
to Section 2.02(c)(2) (Future Advances) including any refinance of an Advance.
“Future Advance Request” means a written request for a Future Advance,
substantially in the form of Exhibit E to this Master Agreement.
“Future Advance Schedule” means Schedule 14 attached to this Master Agreement.
“Future Mineral Rights Conveyance” has the meaning set forth in Section
6.02(o)(2).
“GAAP” means generally accepted accounting principles in the United States in
effect from time to time, consistently applied.
“General Conditions” means those conditions set forth on Schedule 7 attached
hereto.
“General Conditions Schedule” means that certain Schedule 7 (General Conditions
Schedule) to this Master Agreement.
“Goods” has the meaning set forth in the Security Instrument.
“Government Receivables Collection Account Agreement” means, if any, that
certain Government Receivables Collection Account Agreement among Borrower,
Lender, any applicable Property Operator and a depositary bank executed in
connection with this Master Agreement.
“Government Receivables Depositary Agreement” means, if any, that certain
Government Receivables Depositary Agreement among Borrower, Lender, any
applicable Property Operator and a depositary bank executed in connection with
this Master Agreement.
“Governmental Approval” means an authorization, permit, consent, approval,
license, registration or exemption from registration or filing with, or report
to, any Governmental Authority.

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“Governmental Authority” means any court, board, commission, department or body
of any municipal, county, state or federal governmental unit, or any subdivision
of any court, board, commission, department or body of any municipal, county,
state or federal governmental unit, that has or acquires jurisdiction over
Borrower or the Mortgaged Property or the use, operation or improvement of the
Mortgaged Property.
“Governmental Health Care Program” means any plan or program that provides
health benefits, whether directly, through insurance, or otherwise, and that is
funded directly, in whole or in part, by the U.S. Government or a state health
care program.
“Ground Lease” means that certain Lease, dated as of July 15, 1983, evidenced by
that Short Form of Lease for Recordation, recorded August 8, 1983 as Instrument
No. 83-911074 affecting the Mortgaged Property known as Brookdale Santa Monica.
“Gross Revenues” means, for any specified period, all income in respect of each
Mortgaged Property as reflected on the certified operating statement for such
specified period as adjusted to exclude unusual income (e.g. temporary or
nonrecurring income), income not allowed by Lender pursuant to the Underwriting
and Servicing Requirements (e.g. interest income, furniture income, etc.), and
the value of any unreflected concessions.
“Guarantor” means, individually and collectively, any guarantor of the
Indebtedness or any other obligation of Borrower under any Loan Document which
must be a Key Principal.
“Guarantor’s General Business Address” has the meaning set forth in the Summary
of Master Terms.
“Guarantor’s Notice Address” has the meaning set forth in the Summary of Master
Terms.
“Guaranty” means, individually and collectively, Non-Recourse Guaranty or other
guaranty executed by Guarantor in connection with this Master Agreement.
“Hedging Arrangement” means any interest rate swap, interest rate cap or other
arrangement, contractual or otherwise, which has the effect of an interest rate
swap or interest rate cap or which otherwise (directly or indirectly,
derivatively or synthetically) hedges interest rate risk associated with being a
debtor of variable rate debt or any agreement or other arrangement to enter into
any of the above on a future date or after the occurrence of one or more events
in the future.
“HIPAA” means the Health Insurance Portability and Accountability Act of 1996,
Subtitle D of the Health Information Technology for Economic and Clinical Health
Act of 2009, and all regulations and other guidance promulgated under both laws
by the U.S. Department of Health and Human Services, as may be amended from time
to time.
“HIPAA Business Associate” means any entity that is a “business associate” as
that term is defined in HIPAA, as identified on the Summary of Master Terms.
“HIPAA Covered Entity” means any entity that is a “covered entity” as that term
is defined in HIPAA, as identified on the Summary of Master Terms.

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“Identified Party” means, individually and collectively, (a) Borrower’s general
partners, sole member, managing members and managers (if non-member managed),
and (b) any Person Controlling Borrower, Guarantor, Key Principal or Borrower’s
general partners, sole members, managing members or managers (if non-member
managed) but excluding the individuals comprising the Board of Managers of
Borrower or any Person Controlling Borrower and any Persons directly or
indirectly owning any public stock of Guarantor with no other direct or indirect
ownership interest in Borrower.
“Immediate Family Members” means a child, stepchild, grandchild, spouse,
sibling, or parent, each of whom is not a Prohibited Person.
“Imposition Deposits” has the meaning set forth in the Security Instrument.
“Impositions” has the meaning set forth in the Security Instrument.
“Improvements” has the meaning set forth in the Security Instrument.
“Indebtedness” has the meaning set forth in the Security Instrument.
“Independent Living Property” means a Mortgaged Property where at least fifty
percent (50%) of the units are comprised entirely of independent living units,
where all of such units are restricted to the elderly and provide limited
programs of assistance with domestic activities (e.g., meals, housekeeping,
activities, transportation, etc.). An Independent Living Property may contain
one or more Assisted Living units and/or one or more Alzheimer’s Memory Care
units.
“Index” has the meaning set forth in the applicable Schedule of Advance Terms.
“Individual Property Coverage and LTV Tests” means each of the following tests:
(a)    with respect to a Mortgage Property operated as:
(i)    an Independent Living Property, the Debt Service Coverage Ratio is not
less than (i) with respect to any Fixed Advance 1.35:1.0 for the units at a
Mortgaged Property, and (ii) with respect to any Variable Advance, not less than
1.15:1.0 for the units at a Mortgaged Property.
(ii)    an Assisted Living Property, the Debt Service Coverage Ratio is not less
than (i) with respect to any Fixed Advance 1.40:1.0 for the units at a Mortgaged
Property, and (ii) with respect to any Variable Advance, not less than 1.20:1.0
for the units at a Mortgaged Property;
(iii)    an Alzheimer’s Property, the Debt Service Coverage Ratio is not less
than (i) with respect to any Fixed Advance 1.45:1.0 for the units at a Mortgaged
Property, and (ii) with respect to any Variable Advance, not less than 1.25:1.0
for the units at a Mortgaged Property; and

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(iv)    a Skilled Nursing Property, the Debt Service Coverage Ratio is not less
than (i) with respect to any Fixed Advance 1.50:1.0 for the units at a Mortgaged
Property, and (ii) with respect to any Variable Advance, not less than 1.30:1.0
for the units at a Mortgaged Property;
(b)    the Loan to Value Ratio does not exceed seventy percent (70%).
“Initial Adjustable Rate” for an Advance has the meaning set forth in the
applicable Schedule of Advance Terms.
“Initial Advance” means the Fixed Advance and/or Variable Advance made on the
Initial Effective Date in the aggregate amount of $975,000,000.
“Initial Allocable Facility Amount” means the initial Allocable Facility Amount
for each of the Initial Mortgaged Properties as set forth in Exhibit A to this
Master Agreement.
“Initial Borrower” means each Borrower under this Master Agreement as of the
Initial Effective Date.
“Initial Effective Date” means the date of this Master Agreement.
“Initial Monthly Debt Service Payment” has the meaning set forth in the
applicable Schedule of Advance Terms.
“Initial Mortgaged Properties” means the Multifamily Residential Properties
described on Exhibit A to this Master Agreement and which represent the
Mortgaged Properties that are made part of the Collateral Pool on the Initial
Effective Date.
“Initial Replacement Reserve Deposit” has the meaning set forth in the Summary
of Master Terms.
“Initial Valuation” means, when used with reference to specified Collateral, the
Valuation initially performed for the Collateral as of the date on which the
Collateral was added to the Collateral Pool. The Initial Valuation for each of
the Initial Mortgaged Properties is as set forth in Exhibit A to this Master
Agreement.
“Insolvency Laws” means the Bankruptcy Code, together with any other federal or
state law affecting debtor and creditor rights or relating to the bankruptcy,
insolvency, reorganization, arrangement, moratorium, readjustment of debt,
dissolution, liquidation or similar laws, proceedings, or equitable principles
affecting the enforcement of creditors’ rights, as amended from time to time.
“Insolvent” means:
(a)    that the sum total of all of a specified Person’s liabilities (whether
secured or unsecured, contingent or fixed, or liquidated or unliquidated) is in
excess of the value of such Person’s non-exempt assets, i.e., all of the assets
of such Person that are available to satisfy claims of creditors (provided that
for the purposes of determining liability for each Borrower under this

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definition, liability for the Advances Outstanding under this Master Agreement
shall mean the then current Allocable Facility Amount attributable to the
Mortgaged Property owned by each Borrower); or
(b)    such Person’s inability to pay its debts as they become due (provided
that for the purposes of determining debt for each Borrower under this
definition, liability for the Advances Outstanding under this Master Agreement
shall mean the then current Allocable Facility Amount attributable to the
Mortgaged Property owned by each Borrower).
“Insurance Policy” means, with respect to any Mortgaged Property, the insurance
coverage and insurance certificates evidencing such insurance required to be
maintained pursuant to this Master Agreement.
“Intended Prepayment Date” means the date upon which Borrower intends to make a
prepayment on an Advance, as set forth in the Prepayment Notice, which date must
be a Permitted Prepayment Date.
“Intercompany Loan” means an unsecured loan made by (a) Guarantor to Borrower,
(b) Borrower to Guarantor, (c) Borrower to a Borrower Affiliate or (d) a
Borrower Affiliate to Borrower, all in the ordinary course of business and in a
manner which is adequately documented and on terms customary for such loans.
“Interest Accrual Method” has the meaning set forth in the applicable Schedule
of Advance Terms.
“Interest Only Term” has the meaning set forth in the applicable Schedule of
Advance Terms.
“Interest Rate” means with respect to a Fixed Advance, the Fixed Rate, or with
respect to a Variable Advance, the Initial Adjustable Rate and the Adjustable
Rate, each as set forth in the applicable Schedule of Advance Terms.
“Interest Rate Cap” has the meaning set forth in Section 2.03(a)(2)(B)(vi)
(Interest Accrual and Computation; Amortization; Interest Rate Cap).
“Interest Rate Cap Documents” means the Cap Security Agreement and any and all
other documents required pursuant thereto or hereto or as Lender shall require
from time to time in connection with Borrower’s obligation to maintain an
Interest Rate Cap when a Variable Advance is Outstanding.
“Interest Rate Type” has the meaning set forth in the applicable Schedule of
Advance Terms.
“Internal Revenue Code” means the Internal Revenue Code of 1986, as amended.
“Investor” means any Person to whom Lender intends to (a) sell, transfer,
deliver or assign the Advances in the secondary mortgage market or (b) sell an
MBS backed by the Advances.
“Issuer” means a financial institution satisfactory to Fannie Mae issuing a
Letter of Credit.

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“Key Principal” means, collectively:
(a)    the natural Person(s) or entity that Controls Borrower that Lender
determines is critical to the successful operation and management of Borrower
and the Mortgaged Property, as identified as such in the Summary of Master
Terms; or
(b)    any natural Person or entity who becomes a Key Principal after the date
of this Master Agreement and is identified as such in an assumption agreement,
or another amendment or supplement to this Master Agreement.
“Key Principal’s General Business Address” has the meaning set forth in the
Summary of Master Terms.
“Key Principal’s Notice Address” has the meaning set forth in the Summary of
Master Terms.
“Land” means the land described in Exhibit A to the Security Instrument.
“Last Interest Only Payment Date” has the meaning set forth in the applicable
Schedule of Advance Terms.
“Late Charge” means an amount equal to the delinquent amount then due under the
Loan Documents multiplied by five percent (5%).
“Leases” has the meaning set forth in the Security Instrument.
“Lender” means the entity identified as “Lender” in the first paragraph of this
Master Agreement and its transferees, successors and assigns, or any subsequent
holder of the Note.
“Lender’s General Business Address” has the meaning set forth in the Summary of
Master Terms.
“Lender’s Notice Address” has the meaning set forth in the Summary of Master
Terms.
“Lender’s Payment Address” has the meaning set forth in the Summary of Master
Terms.
“Letter of Credit” means a letter of credit issued by an Issuer satisfactory to
Fannie Mae naming Fannie Mae as beneficiary, in form and substance approved by
Lender and Fannie Mae.
“Letter of Credit Schedule” means Schedule 15 attached to this Master Agreement.
“LIBOR” means One Month LIBOR or Three Month LIBOR, as specified by the Current
Index set forth in the applicable Schedule of Advance Terms.
“License” means any operating licenses, certificates of occupancy, health
department licenses, food service licenses, certificates of need, business
licenses, permits, registrations, certificates, authorizations, approvals, legal
authority, and similar documents required by Applicable Law and regulations for
the lawful operation of any Mortgaged Property as a Seniors Housing Facility in
the Property Jurisdiction as of the date the Mortgaged Property is added to the
Collateral Pool or during

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the Term of this Master Agreement, including renewals, replacements and
additions to any of the foregoing.
“Lien” has the meaning set forth in the Security Instrument.
“Loan Application” means the application for the Advances submitted by Borrower
to Lender.
“Loan Document Taxes” has the meaning set forth in Section 5.02(f) (Loan Taxes).
“Loan Documents” means the Note, this Master Agreement, the Security Instrument,
the SASA, the Environmental Indemnity Agreement, the Guaranty, all guaranties,
all indemnity agreements, all Collateral Agreements, all O&M Plans, and any
other documents now or in the future executed by Borrower, Property Operator,
Guarantor, Key Principal, any other guarantor or any other Person in connection
with the Advances, as such documents may be amended, restated, replaced,
supplemented or otherwise modified from time to time.
“Loan Servicer” means the entity that from time to time is designated by Lender
to collect payments and deposits and receive notices under the Note, this Master
Agreement, the Security Instrument and any other Loan Document, and otherwise to
service the Advances for the benefit of Lender. Unless Borrower receives notice
to the contrary, the Loan Servicer shall be Lender originally named on the
Summary of Master Terms.
“Loan to Value Ratio” means, for a Mortgaged Property, for any specified date,
the ratio (expressed as a percentage) of --
(a)    the Allocable Facility Amount of the subject Mortgaged Property on the
specified date,
to
(b)    the Valuation most recently obtained prior to the specified date for the
subject Mortgaged Property.
“Major Shareholders” means any “person” or “group” (as such terms are used in
Section 13(d) and 14(d) of the Securities Exchange Act of 1934, as amended (the
“Exchange Act”)), that is the “beneficial owner” (as defined in Rules 13d-3 and
13d-5 under the Exchange Act, except that a Person will be deemed to have
“beneficial ownership” of all securities that such Person has the right to
acquire, whether such right is exercisable immediately or only after the passage
of time), directly or indirectly, of more than five (5%) of the total voting
power of the then outstanding voting stock of an entity.
“Managed Care Organization” means a Person that has been certified by, and has
entered into a contractual relationship with, a Governmental Authority in the
Property Jurisdiction to make available to its members (including residents of
the Mortgaged Property) certain long-term care and health care services through
Medicaid Participant(s), which, as of the date the Mortgaged Property is added
to the Collateral Pool, is the party identified on the Summary of Master Terms.

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“Management Agreement” means, if applicable, any agreement for management
services as amended, restated, replaced, supplemented, or otherwise modified
from time to time, preapproved in writing by Lender, under which daily
management or operation with respect to the Mortgaged Property as a Seniors
Housing Facility has been granted to any individual or entity other than
Borrower.
“Manager” means the Person responsible for the operation or management of the
Mortgaged Property pursuant to a Management Agreement, if any.
“Margin” means the “Margin” set forth in the applicable Schedule of Advance
Terms, which includes the Variable Fee.
“Master Agreement” means this Master Credit Facility Agreement (Seniors
Housing), as it may be amended, restated, supplemented or otherwise modified
from time to time, including all Recitals, Schedules and Exhibits to this Master
Agreement, each of which is hereby incorporated into this Master Agreement by
this reference.
“Material Adverse Effect” means, with respect to any circumstance, act,
condition or event of whatever nature (including any adverse determination in
any litigation, arbitration, or governmental investigation or proceeding),
whether singularly or in conjunction with any other event or events, act or
acts, condition or conditions, or circumstance or circumstances, whether or not
related, a material adverse change in or a materially adverse effect upon any of
(a)    the business, operations, property or condition (financial or otherwise)
of any Borrower Entity or Affiliated Property Operator, to the extent
specifically referred to in the applicable provision of the applicable Loan
Document;
(b)    the present or future ability of Borrower to perform the obligations of
Borrower under this Master Agreement and the other Loan Documents, or of
Guarantor to perform its obligations under the Guaranty, as the case may be, to
the extent specifically referred to in the applicable provision of the
applicable Loan Document;
(c)    the validity, priority, perfection or enforceability of this Master
Agreement or any other Loan Document or the rights or remedies of Lender under
any Loan Document; or
(d)    the value of, or Lender’s ability to have recourse against, any Mortgaged
Property.
“Material Commercial Lease” means any Lease that is not a Residential Lease and
which is:
(a)    a Lease comprising five percent (5%) or more of total gross income of any
Mortgaged Property on an annualized basis;
(b)    a master Lease (which term “master Lease” shall include any master Lease
to a single corporate tenant);
(c)    a cell tower Lease;

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(d)    a solar (power) Lease;
(e)    a solar power purchase agreement; or
(f)    a Lease of oil, gas, or mineral rights.
For purposes of the Loan Documents, any Seniors Housing Facility Lease on the
Mortgaged Property shall not be deemed either a “Material Commercial Lease” or a
“non-Material Commercial Lease.”
“Maturity Date” for any Advance has the meaning set forth in the applicable
Schedule of Advance Terms.
“Maximum Inspection Fee” has the meaning set forth in the Summary of Master
Terms.
“Maximum Permitted Equipment Financing” has the meaning set forth in the Summary
of Master Terms.
“Maximum Repair Cost” shall be the amount(s) set forth in the Required Repair
Schedule, if any.
“Maximum Repair Disbursement Interval” has the meaning set forth in the Summary
of Master Terms.
“Maximum Replacement Reserve Disbursement Interval” has the meaning set forth in
the Summary of Master Terms.
“MBS” means an investment security that represents an undivided beneficial
interest in a pool of mortgage loans or participation interests in mortgage
loans held in trust pursuant to the terms of a governing trust document.
“Medicaid” means the medical assistance program established by Title XIX of the
Social Security Act (42 U.S.C. Secs. 1396 et seq.) and any statutes succeeding
thereto.
“Medicaid Participant” means a Person that has entered into a Medicaid Provider
Agreement as identified on the Summary of Master Terms.
“Medicaid Program” means the Medicaid assisted living waiver program
administered by a Governmental Authority under which certain benefits are
available through a Governmental Authority or a Managed Care Organization.
“Medicaid Provider Agreement” means, individually and collectively, an agreement
between Borrower or Property Operator and a Governmental Authority (or
administered by a Governmental Authority, as applicable) or a Managed Care
Organization to be a participating provider under the Medicaid Program, as
further described in the Summary of Master Terms, as the same may be amended,
restated, replaced, supplemented, or otherwise modified from time to time.

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“Mezzanine Debt” means a loan to a direct or indirect owner of Borrower or
Affiliated Property Operator secured by a pledge of such owner’s interest in an
entity owning a direct or indirect interest in Borrower or Affiliated Property
Operator.
“Mineral Rights Conveyance” has the meaning set forth in Section 6.01(h).
“Mineral Conveyance Properties” has the meaning set forth in Section 6.01(h).
“Minimum Repairs Disbursement Amount” has the meaning set forth in the Summary
of Master Terms.
“Minimum Replacement Reserve Disbursement Amount” has the meaning set forth in
the Summary of Master Terms.
“Monthly Cap Escrow Payment” shall have the same meaning as the term “Monthly
Deposit” in the Cap Security Agreement.
“Monthly Debt Service Payment” has the meaning set forth in the applicable
Schedule of Advance Terms.
“Monthly Replacement Reserve Deposit” has the meaning set forth in the Summary
of Master Terms.
“Moody’s” means Moody’s Investors Service, Inc., a corporation organized and
existing under the laws of the State of Delaware, and its successors and
assigns, if such successors and assigns shall continue to perform the functions
of a securities rating agency.
“Mortgaged Property” individually has the meaning set forth in the Security
Instrument and collectively means the Initial Mortgaged Properties and the
Additional Mortgaged Properties, but excluding each Release Mortgaged Property
from and after the date of its Release from the Collateral Pool.
“Mortgaged Property Addition Schedule” means Schedule 11 attached to this Master
Agreement.
“Mortgaged Property Release Schedule” means Schedule 10 attached to this Master
Agreement.
“Multiemployer Plan” shall mean a multiemployer plan within the meaning of
Section 4001(a)(3) or Section 3(37) of ERISA (a) to which Borrower or any ERISA
Affiliate is making or accruing an obligation to make contributions; (b) to
which Borrower or any ERISA Affiliate has in the past made contributions; or
(c) with respect to which Borrower or any ERISA Affiliate could incur liability.
“Multifamily Project Address” has the meaning set forth in the Summary of Master
Terms.
“Multifamily Residential Property” means a residential property located in the
United States and conforming to the Underwriting and Servicing Requirements.

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“National Contracts” means any contract or other agreement for the provision of
goods or services at or otherwise in connection with the operation, use or
maintenance of a Mortgaged Property and one or more properties that is not a
Mortgaged Property, which contract or agreement (i) obligates a third party to
perform a service or services or to provide goods or supplies needed in
accordance with the obligations of the Borrower or Property Operator as set
forth in any Lease or other agreement between Borrower or Property Operator and
a resident; (ii) obligates a third party to perform a service or services or to
provide goods or supplies needed to comply with any Licenses, or (iii) obligates
a third party to perform a service or services or to provide goods or supplies
necessary for the Borrower or Property Operator to provide any and all life
safety equipment or services in accordance with any Lease or Applicable Law;
provided, however, that “National Contracts” does not include the Operating
Lease or Management Agreement, if any, or any contract or agreement to which
Borrower is a party.
“Net Operating Income” means, for any specified period determined by Lender with
respect to any Mortgaged Property, the net income during such period equal to
Gross Revenues during such period less the aggregate Operating Expenses during
such period.
“New Operator” has the meaning set forth in Section 6.01(j).
“Non-Recourse Guaranty” means, if applicable, that certain Guaranty of
Non-Recourse Obligations of even date herewith executed by Guarantor to and for
the benefit of Lender, as the same may be amended, restated, replaced,
supplemented or otherwise modified from time to time.
“Note” means, individually and collectively, each Fixed Note and/or each
Variable Note.
“O&M Plan” has the meaning set forth in the Environmental Indemnity Agreement.
“OFAC” means the United States Treasury Department, Office of Foreign Assets
Control, and any successor thereto.
“Offering Vehicle” means a corporation, limited liability company, limited
partnership, or trust that is initially Controlled by (i) Guarantor, or (ii)
following a Transfer to a Qualified Transferee, a Qualified Transferee, and at
the time of any Transfer permitted under clause (ii) above, will concurrently
with such Transfer, become a Public Vehicle.
“One Month LIBOR” means the ICE Benchmark Administration Limited (or any
successor administrator) fixing of the London Inter-Bank Offered Rate for
1-month U.S. Dollar-denominated deposits as reported by Reuters through
electronic transmission. If the Index is no longer available, or is no longer
posted through electronic transmission, Lender will choose a new index that is
based upon comparable information and provide notice thereof to Borrower.
“Operating Company” shall mean a limited liability company or limited
partnership owning all multifamily residential housing and seniors housing
properties through which an Offering Vehicle indirectly owns its assets and
conducts all or substantially all of its business.

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“Operating Expenses” means, for any period, all expenses in respect of any
Mortgaged Property, as determined pursuant to the Underwriting and Servicing
Requirements based on the certified operating statement for such specified
period, as may be adjusted by Lender in its sole and absolute discretion to
provide for the following:
(a)    all appropriate types of expenses, including a management fee, deposits
for the Replacements (whether funded or not), and deposits for Repair are
included in the total operating expense figure;
(b)    upward adjustments to individual line item expenses to reflect market
norms or actual costs and to correct any unusually low expense items, which
could not be replicated by a different owner or manager (e.g., a market rate
management fee will be included regardless of whether or not a management fee is
charged, market rate payroll will be included regardless of whether shared
payroll provides for economies, etc.); and
(c)    downward adjustments to individual line item expenses to reflect unique
or aberrant costs (e.g., non-recurring capital costs, non-operating borrower
expenses, etc.).
“Operating Lease” means, if applicable, any operating lease, master lease, or
similar document as amended, restated, replaced, supplemented, or otherwise
modified from time to time, preapproved in writing by Lender, under which
control of the occupancy, use, operation, management, maintenance or
administration of the Mortgaged Property as a Seniors Housing Facility has been
granted by Borrower as lessor to any Person (other than Borrower) as lessee.
“Operator” means the Person responsible for the occupancy, use, operation,
management, maintenance and administration of the Mortgaged Property pursuant to
an Operating Lease, if any.
“Operator Estoppel Certificate” means a certificate of estoppel from Property
Operator to Lender in a form required by Lender pursuant to the terms of Section
7.02(g)(2) (Seniors Housing Facility Lease Estoppel) of this Master Agreement.
“Organizational Certificate” means, collectively, certificates from Borrower and
Guarantor to Lender, in the form of Exhibits L-1 and L-2 to this Master
Agreement, certifying as to certain organizational matters with respect to each
Borrower and Guarantor.
“Organizational Documents” means all certificates, instruments, other documents
and any amendments thereto in effect on the Initial Effective Date and the
applicable Effective Date pursuant to which any Person is organized, operates or
is governed, including (a) with respect to a corporation, its articles of
incorporation and bylaws, (b) with respect to a limited partnership, its limited
partnership certificate and partnership agreement, (c) with respect to a general
partnership or joint venture, its partnership or joint venture agreement, (d)
with respect to a limited liability company, its articles of organization and
operating agreement, in each case all amendments, supplements and modifications
thereto, and (e) any other document that affects the Control of, or the ability
to oversee the management and day-to-day operations of such Person.

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“Outstanding” or “outstanding” means, when used in connection with promissory
notes, other debt instruments or the Advances, for a specified date, promissory
notes or other debt instruments which have been issued, or Advances which have
been made, to the extent not repaid in full as of the specified date.
“Ownership Interests” means, with respect to any entity, any direct or indirect
ownership interests in the entity and any economic rights (such as a right to
distributions, net cash flow or net income) to which the owner of such ownership
interests is entitled.
“Ownership Interests Schedule” means Schedule 13 attached to this Master
Agreement.
“Payment Change Date” has the meaning set forth in the applicable Schedule of
Advance Terms.
“Payment Date” means the First Payment Date and the first (1st) day of each
month thereafter until the applicable Advance is fully paid.
“Permitted Encumbrance” has the meaning set forth in the Security Instrument.
“Permitted Equipment Financing” means equipment lease or other purchase money
financing incurred in the ordinary course for (a) the lease of vehicles for use
at the Mortgaged Property, and to refinance Permitted Equipment Financing
incurred pursuant to this clause and (b) the acquisition of additional or
replacement equipment or other personal property (excluding the vehicles
referred to in clause (a)), or to refinance Permitted Equipment Financing
incurred pursuant to this clause (b). The maximum amount of Permitted Equipment
Financing pursuant to Clause (b) of this definition shall not exceed, at any
time, the Maximum Permitted Equipment Financing.
“Permitted Indebtedness” means with respect to each Mortgaged Property, (i)
Permitted Equipment Financing, (ii) Indebtedness incurred by any Borrower
pursuant to the Contribution Agreement, (iii) any Future Advance and (iv) any
Intercompany Loan made in accordance with this Master Agreement.
“Permitted Liens” means (i) Permitted Encumbrance, (ii) liens securing
indebtedness permitted under clause (i) of the definition of Permitted
Indebtedness, (iii) liens created by the Loan Documents, (iv) Leases permitted
by this Master Agreement; and (v) liens described in Section 11.02(a) and
clauses (E) and (F) of Section 11.02(b)(1).
“Permitted Mezzanine Debt” means Mezzanine Debt incurred by a direct or indirect
owner or owners of Borrower or Affiliated Property Operator where the exercise
of any of the rights and remedies by the holder or holders of the Mezzanine Debt
would not in any circumstance cause (a) a change in Control in Borrower,
Affiliated Property Operator, Key Principal, or Guarantor, or (b) a Transfer of
a direct or indirect Restricted Ownership Interest in Borrower, Affiliated
Property Operator, Key Principal, or Guarantor.
“Permitted Preferred Equity” means Preferred Equity that does not (a) require
mandatory dividends, distributions, payments or returns (including at maturity
or in connection with a redemption), or (b) provide the Preferred Equity owner
with rights or remedies on account of a

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failure to receive any preferred dividends, distributions, payments or returns
(or, if such rights are provided, the exercise of such rights do not violate the
Loan Documents or are otherwise exercised with the prior written consent of
Lender in accordance with Article 11 (Liens, Transfers and Assumptions) of this
Master Agreement and the payment of all applicable fees and expenses as set
forth in Section 11.03(g) (Further Conditions on Transfers Requiring Lender’s
Consent)).
“Permitted Prepayment Date” means the last Business Day of a calendar month.
“Person” means an individual, an estate, a trust, a corporation, a partnership,
a limited liability company or any other organization or entity (whether
governmental or private).
“Personal Property” means the Goods, accounts, choses of action, chattel paper,
documents, general intangibles (including Software), payment intangibles,
instruments, investment property, letter of credit rights, supporting
obligations, computer information, source codes, object codes, records and data,
all telephone numbers or listings, claims (including claims for indemnity or
breach of warranty), deposit accounts and other property or assets of any kind
or nature related to the Land or the Improvements, including operating
agreements, surveys, plans and specifications and contracts for architectural,
engineering and construction services relating to the Land or the Improvements,
and all other intangible property and rights relating to the operation of, or
used in connection with, the Land or the Improvements, including all
governmental permits relating to any activities on the Land.
“Personalty” has the meaning set forth in the Security Instrument.
“Potential Event of Default” means any event or circumstance that, with the
giving of notice or the passage of time, or both, would constitute an Event of
Default.
“Preferred Equity” means a direct or indirect equity ownership interest in,
economic interests in, or rights with respect to, Borrower that provide an
equity owner preferred dividend, distribution, payment, or return treatment
relative to other equity owners.
“Prepayment Lockout Period” for any Advance has the meaning set forth in the
applicable Schedule of Advance Terms.
“Prepayment Notice” means the written notice that Borrower is required to
provide to Lender in accordance with Section 2.04 (Prepayment; Prepayment
Lockout; Prepayment Premium) in order to make a prepayment on an Advance, which
shall include, at a minimum, the Intended Prepayment Date.
“Prepayment Premium” means, individually, the amount payable by Borrower in
connection with a prepayment of an Advance, as provided in Section 2.04
(Prepayment; Prepayment Lockout; Prepayment Premium) and calculated in
accordance with the Prepayment Premium Schedule applicable to such Advance for
such Advance, and, collectively, all amounts payable pursuant to all Prepayment
Premium Schedules.

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“Prepayment Premium Period End Date” or “Yield Maintenance Period End Date” for
any Advance has the meaning set forth in the applicable Schedule of Advance
Terms.
“Prepayment Premium Period Term” or “Yield Maintenance Period Term” for any
Advance has the meaning set forth in the applicable Schedule of Advance Terms.
“Prepayment Premium Schedule” means, individually and collectively, Schedule 4
(Prepayment Premium) to this Master Agreement for each Advance.
“Prepayment Premium Term” for any Advance has the meaning set forth in the
applicable Schedule of Advance Terms.
“Privacy Laws” mean any federal, state and local laws and regulations applicable
to resident and tenant privacy, including but not limited to HIPAA.
“Prohibited Person” means:
(a)    any Person with whom Lender or Fannie Mae is prohibited from doing
business pursuant to any law, rule, regulation, judicial proceeding or
administrative directive; or
(b)    any Person identified on the United States Department of Housing and
Urban Development’s “Limited Denial of Participation, HUD Funding
Disqualifications and Voluntary Abstentions List,” or on the General Services
Administration’s “System for Award Management (SAM)” exclusion list, each of
which may be amended from time to time, and any successor or replacement
thereof; or
(c)    any Person that is determined by Fannie Mae to pose an unacceptable
credit risk due to the aggregate amount of debt of such Person owned or held by
Fannie Mae; or
(d)    any Person that has caused any unsatisfactory experience of a material
nature with Fannie Mae or Lender, such as a default, fraud, intentional
misrepresentation, litigation, arbitration or other similar act.
“Property Delivery Deadline” has the meaning set forth in the Mortgaged Property
Addition Schedule.
“Property Jurisdiction” has the meaning set forth in the Security Instrument.
“Property Operator” means individually and collectively, (a) any Operator
(b) any Sublessee, and (c) any Manager, as identified in the Summary of Master
Terms.
“Property Operator Business Information” has the meaning set forth in Section
7.02(g)(1)(D) (Seniors Housing Facility Lease) of this Master Agreement.
“Property Operator’s General Business Address” means, as applicable, the
Manager’s General Business Address, the Operator’s General Business Address,
and/or the Sublessee’s General Business Address.

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“Property-Related Documents” has the meaning set forth on Schedule 8 attached to
this Master Agreement.
“Property-Related Documents Schedule” means Schedule 8 attached to this Master
Agreement.
“Publicly-Held Corporation” means a corporation, the outstanding voting stock of
which is registered under Sections 12(b) or 12(g) of the Securities Exchange Act
of 1934, as amended.
“Publicly-Held Trust” means a real estate investment trust, the outstanding
voting shares or beneficial interests of which are registered under Sections
12(b) or 12(g) of the Securities Exchange Act of 1934, as amended.
“Public Listing” means the listing of the legal or beneficial interests of a
Person on the New York Stock Exchange or a nationally or internationally
recognized securities exchange, or the quotation thereof on a nationally or
internationally recognized automated quotation system, including, without
limitation, NASDAQ.
“Public Transfer” has the meaning set forth in Section 11.03(b)(3) of this
Master Agreement.

“Public Transfer Conditions” means all of the following conditions:

(a)    no Event of Default or Potential Event of Default exists;
(b)    Borrower delivers notice of any such Public Transfer to Lender not less
than thirty (30) days prior thereto, which notice is accompanied by (i) in
connection with a Transfer pursuant to Section 11.03(b)(3)(i), a restructuring
fee in the amount of $75,000; and (ii) in connection with a Transfer pursuant to
Section 11.03(b)(3)(ii), a Review Fee;
(c)    Lender receives organizational charts and organizational documents
reflecting the structure of the Borrower, Affiliated Property Operator and
Guarantor prior to and after such Public Transfer (which may be in draft form
until the same are completed in form acceptable to Lender) and Lender receives
any certificates, financial statements, underwriting documentation, or other
documentation requested by Lender with respect to the Public Transfer in a form
acceptable to Lender;
(d)    the transferee is validly existing and qualified to transact business and
is in good standing in the state in which it is organized and in each other
jurisdiction in which such qualification and/or standing is necessary to the
conduct of its business and where the failure to be so qualified or in good
standing would adversely affect (w) Borrower’s ownership or operation of the
Mortgaged Property, (x) Affiliated Property Operator’s management, leasing or
operation (as applicable) of the Mortgaged Property, (y) the validity or
enforceability of, or the ability of Borrower to perform its obligations under
this Master Agreement or any other Loan Document, or (z) the validity or
enforceability of, or the ability of Affiliated Property Operator to perform its
obligations under the Facility Operating Agreement;

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(e)    in connection with a Transfer pursuant to Section 11.03(b)(3)(i), there
is no change of Control as a result of the Transfer;
(f)    in connection with a Transfer pursuant to Section 11.03(b)(3)(ii), the
Public Vehicle has a board of directors that remains unchanged from the board of
directors serving immediately prior to the Public Listing or is initially
appointed by the Controlling Sponsor or Qualified Transferee, as applicable, and
each member of such board of directors shall not be a Prohibited Person;
(g)    the Offering Vehicle, together with the Operating Company, if any,
satisfies the Experience Eligibility Requirements;
(h)    Borrower shall have paid to Lender upon demand, all of Lender’s
out-of-pocket costs (including reasonable attorneys’ fees) incurred in reviewing
the Public Transfer documentation, regardless of whether the Public Transfer is
consummated;
(i)    the Offering Vehicle Controls the Operating Company, if any;
(j)    the Offering Vehicle and the Operating Company, if any, owns fifty one
percent (51%) or more of the direct or indirect interests in Guarantor (if
Guarantor is not the Offering Vehicle), Borrower and Affiliated Property
Operator, if any;
(k)    the Offering Vehicle and the Operating Company, if any, directly or
indirectly, Control Guarantor (if Guarantor is not the Offering Vehicle),
Borrower and Affiliated Property Operator, if any;
(l)    the Offering Vehicle owns fifty one percent (51%) or more of the
outstanding interests in the Operating Company, if any;
(m)    either (x) Guarantor ratifies and confirms its obligations under the
Guaranty executed on the Initial Effective Date, or (y) Borrower shall cause the
Offering Vehicle and if an Operating Company is formed, the Operating Company,
to have each executed and delivered to Lender a replacement Guaranty in form
substantially similar to the Guaranty executed by Guarantor on the Initial
Effective Date and Lender shall have received reasonably acceptable evidence of
the authority of the Offering Vehicle and Operating Company to execute and
deliver a replacement Guaranty together with a legal opinion regarding the due
execution and authority of the Offering Vehicle and Operating Company with
respect to the same and the enforceability of the same, all in form and content
reasonably acceptable to Lender;
(n)    the Mortgaged Property is and will continue to be operated and managed
either by (1) the initial or then-current Property Operator, or (2) a successor
Property Operator satisfactory to Lender pursuant to a Facility Operating
Agreement approved by Lender in writing, which successor Property Operator,
together with Borrower, shall execute a Subordination, Assignment and Security
Agreement in Fannie Mae’s then-current form;

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(o)    if applicable, Borrower executes and delivers to Lender an amendment to
this Master Agreement and any other Loan Documents required by Lender to
evidence the change in the change of Control and Transfer of the Restricted
Ownership Interest; and
(p)    on the closing date of a Transfer pursuant to a Transfer pursuant to
Section 11.03(b)(4)(ii), Borrower pays to Lender the Transfer Fee.
“Public Vehicle” shall mean a Person with an initial market capitalization equal
to or in excess of $500,000,000, exclusive of the Ownership Interests in the
Borrower and the Mortgaged Properties, and whose securities are and remain
listed on a Public Listing.
“Qualified Transfer Conditions” means all of the following:
(a)    no Event of Default or Potential Event of Default exists;
(b)    Borrower delivers notice of any such Transfer to a Qualified Transferee
to Lender not less than thirty (30) days prior thereto, which notice is
accompanied by a Review Fee;
(c)    Lender receives organizational charts and organizational documents
reflecting the structure of the Borrower, Affiliated Property Operator and
Guarantor prior to and after such Transfer to a Qualified Transferee (which may
be in draft form until the same are completed in form acceptable to Lender) and
Lender receives any certificates, financial statements, underwriting
documentation, or other documentation requested by Lender with respect to the
Transfer to a Qualified Transferee in a form acceptable to Lender;
(d)    Qualified Transferee is validly existing and qualified to transact
business and is in good standing in the state in which it is organized and in
each other jurisdiction in which such qualification and/or standing is necessary
to the conduct of its business and where the failure to be so qualified or in
good standing would adversely affect (w) Borrower’s ownership or operation of
the Mortgaged Property, (x) Affiliated Property Operator’s management, leasing
or operation (as applicable) of the Mortgaged Property, (y) the validity or
enforceability of, or the ability of Borrower to perform its obligations under
this Master Agreement or any other Loan Document, or (z) the validity or
enforceability of, or the ability of Affiliated Property Operator to perform its
obligations under the Facility Operating Agreement;
(e)    Qualified Transferee, individually or in combination with its wholly
owned Affiliates, must own 51% or more of the Borrower and the Guarantor;
(f)    Qualified Transferee must Control Borrower and Guarantor;
(g)    Borrower shall have paid to Lender upon demand, all of Lender’s
out-of-pocket costs (including reasonable attorneys’ fees) incurred in reviewing
the documentation relating to the Transfer to the Qualified Transferee
regardless of whether the Transfer to the Qualified Transferee is consummated;
(h)    either (x) the Guarantor, directly or indirectly, Controls Borrower and
ratifies and confirms its obligations under the Guaranty executed on the Initial
Effective Date, or (y) a

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replacement Guarantor acceptable to Lender executes a Guaranty in substantially
the same form as the Guaranty executed on the Initial Effective Date and Lender
shall have received reasonably acceptable evidence of the authority of
replacement Guarantor to execute and deliver a replacement Guaranty together
with a legal opinion regarding the due execution and authority of the
replacement Guarantor with respect to the same and the enforceability of the
same, all in form and content reasonably acceptable to Lender;
(i)    the Mortgaged Property is and will continue to be operated and managed
either by (1) the initial or then-current Property Operator, or (2) a successor
Property Operator satisfactory to Lender pursuant to a Facility Operating
Agreement approved by Lender in writing, which successor Property Operator,
together with Borrower, shall execute a Subordination, Assignment and Security
Agreement in Fannie Mae’s then-current form;
(j)    Borrower executes and delivers to Lender an amendment to this Master
Agreement and any other Loan Documents required by Lender to evidence the change
in the change of Control and Transfer of the Restricted Ownership Interest and
modify such definitions; and
(k)    on the closing date of the Transfer, Borrower pays to Lender the Transfer
Fee.
“Qualified Transferee” means an entity which is formed and domiciled in the
United States and is, or is owned and Controlled by, an entity which (a) will
have, after the purchase of direct or indirect interests in Borrower, a minimum
net worth of at least $500,000,000 (which net worth will not include the
Qualified Transferee’s interests in the Borrower and/or the Mortgaged Property)
and minimum liquid assets of at least $50,000,000, (b) is not a Prohibited
Person, (c) has not been a debtor in a bankruptcy or bankruptcy-related
reorganization within the tem (10) years preceding the date of the proposed
Transfer, (d) is not involved in any litigation in which a negative outcome
would be reasonably likely to reduce such transferee’s net worth below the
minimum liquidity and net worth requirements set forth above, (e) has not been
convicted of fraud or a crime involving moral turpitude (and no principal of
such entity has been convicted of fraud or a crime involving moral turpitude),
and (f) meets the Experience Eligibility Requirements. An entity which is, or is
controlled by an entity which is, formed in a foreign country or is a foreign
citizen shall not be precluded from being a Qualified Transferee so long as it
holds a direct or indirect interest in Borrower through a United
States-chartered entity.
“Rate Change Date” has the meaning set forth in the applicable Schedule of
Advance Terms.
“Release” has the meaning set forth in Section 2.10(b) (Right to Obtain Releases
of Mortgaged Property).
“Release Documents” mean instruments releasing the applicable Security
Instrument as a Lien on a Mortgaged Property, and UCC-3 Termination Statements
terminating the UCC-1 Financing Statements, and such other documents and
instruments to evidence the Release of such Mortgaged Property from the
Collateral Pool.
“Release Fee” means with respect to any Release effected in accordance with
Section 2.10(b) (Right to Obtain Releases of Mortgaged Property), a fee in the
amount of $20,000 per Release Request.

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“Release Mortgaged Property” means the Mortgaged Property to be released
pursuant to Section 2.10(b) (Right to Obtain Releases of Mortgaged Property).
“Release Price” has the meaning set forth in the Mortgaged Property Release
Schedule.
“Release Request” means a written request, substantially in the form of
Exhibit C to this Master Agreement, to obtain a Release of Mortgaged Property
from the Collateral Pool pursuant to Section 2.10(b) (Right to Obtain Releases
of Mortgaged Property).
“Remaining Amortization Period” has the meaning set forth in the applicable
Schedule of Advance Terms.
“Remaining Mortgaged Properties” has the meaning set forth in the Mortgaged
Property Release Schedule.
“Rent Roll” means, with respect to any Mortgaged Property, a rent roll prepared
and certified by the owner of such Mortgaged Property, on a form approved by
Lender.
“Rents” has the meaning set forth in the Security Instrument.
“Repair Threshold” has the meaning set forth in the Summary of Master Terms.
“Repairs” means, individually and collectively, the Required Repairs, Borrower
Requested Repairs, and Additional Lender Repairs.
“Repairs Escrow Account” means the account established by Lender into which the
Repairs Escrow Deposit is deposited to fund the Repairs.
“Repairs Escrow Account Administrative Fee” has the meaning set forth in the
Summary of Master Terms.
“Repairs Escrow Deposit” has the meaning set forth in the Summary of Master
Terms.
“Replacement Reserve Account” means the account established by Lender into which
the Replacement Reserve Deposits are deposited to fund the Replacements.
“Replacement Reserve Account Administration Fee” has the meaning set forth in
the Summary of Master Terms.
“Replacement Reserve Account Interest Disbursement Frequency” has the meaning
set forth in the Summary of Master Terms.
“Replacement Reserve Deposits” means the Initial Replacement Reserve Deposit,
Monthly Replacement Reserve Deposits and any other deposits to the Replacement
Reserve Account required by this Master Agreement.
“Replacement Threshold” has the meaning set forth in the Summary of Master
Terms.

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“Replacements” means, individually and collectively, the Required Replacements,
Borrower Requested Replacements and Additional Lender Replacements.
“Request” means a Future Advance Request, an Addition Request, a Release
Request, or a Conversion Request.
“Request Opinion” means a favorable opinion of counsel (including local counsel,
as applicable) to Borrower, as to the due organization and qualification of
Borrower, the due authorization, execution, delivery and enforceability of each
Loan Document executed in connection with the applicable Request and such other
matters as Lender may reasonably require, each dated as of the Effective Date
for the Request, in form and substance satisfactory to Lender in all respects.
“Required Repair Schedule” means that certain Schedule 6 (Required Repair
Schedule) to this Master Agreement.
“Required Repairs” means those items listed on the Required Repair Schedule.
“Required Replacement Schedule” means that certain Schedule 5 (Required
Replacement Schedule) to this Master Agreement.
“Required Replacements” means those items listed on the Required Replacement
Schedule.
“Rescinded Payment” has the meaning set forth in Section 3.12 (Preferences,
Fraudulent Conveyances, Etc.) of this Master Agreement.
“Reserve/Escrow Account Funds” means, collectively, the funds on deposit in the
Reserve/Escrow Accounts.
“Reserve/Escrow Accounts” means, together, the Replacement Reserve Account and
the Repairs Escrow Account.
“Residential Lease” means a Lease of an individual dwelling unit and shall not
include any master Lease (which term “master Lease” includes any master Lease to
a single corporate tenant but not a Seniors Housing Facility Lease).
“Restoration” means restoring and repairing the applicable Mortgaged Property to
the equivalent of its physical condition immediately prior to the casualty or to
a condition approved by Lender following a casualty.
“Restricted Ownership Interest” means with respect to any Borrower, the
requirement that Guarantor owns, directly or indirectly, no less than fifty-one
percent (51%) of the Ownership Interests in such Borrower.
“Re-Underwriting Fee” means, with respect to any Future Advance made without the
Addition of an Additional Mortgaged Property under the proviso of Section
2.02(c)(2)(B), a non-refundable fee of the greater of (i) Sixty Thousand Dollars
($60,000) and (ii) forty (40) basis points (0.40%) multiplied by the Future
Advance.

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“Review Fee” means the non-refundable fee of Six Thousand Dollars ($6,000)
payable to Lender.
“S&P” means Standard & Poor’s Credit Markets Services, a division of The
McGraw-Hill Companies, Inc., a New York corporation, and its successors and
assigns, if such successors and assigns shall continue to perform the functions
of a securities rating agency.
“Sanctioned Country” means a country subject to a comprehensive country-wide
sanctions program administered and enforced by OFAC, which list is updated from
time to time.
“Sanctioned Person” means (a) a Person named on the list of “Specially
Designated Nationals and Blocked Persons” maintained by OFAC, available at
http://www.treasury.gov/resource-center/sanctions/SDN-List/Pages/default.aspx,
or as otherwise published from time to time; (b) (1) an agency of the government
of a Sanctioned Country, (2) an organization controlled by a Sanctioned Country,
or (3) a Person resident in a Sanctioned Country, to the extent any Person
described in clauses (1), (2) or (3) is the subject of a sanctions program
administered by OFAC; and, (c) a Person whose property and interests in property
are blocked pursuant to an Executive Order or regulations administered by OFAC
consistent with the guidance issued by OFAC.
“SASA” means a Subordination, Assignment and Security Agreement in a form
approved by Lender affecting the Mortgaged Property executed and delivered to
Lender by Borrower and any Property Operator as the same may be amended,
restated, replaced, supplemented, or otherwise modified from time to time.
“Schedule of Advance Terms” means, individually and collectively as the context
may require the Schedule(s) of Advance Terms attached to this Master Agreement
as Schedule 3 as of the Initial Effective Date and as such Schedule shall be
amended or supplemented with respect to any Future Advance.
“Security Documents” means the Security Instruments and any other documents
executed by Borrower or Guarantor from time to time to secure any of Borrower’s
or Guarantor’s obligations under the Loan Documents, as the same may be amended,
restated, modified or supplemented from time to time.
“Security Instrument” means for each Mortgaged Property, a Multifamily Mortgage,
Deed of Trust or Deed to Secure Debt, Assignment of Leases and Rents and
Security Agreement given by a Borrower to or for the benefit of Lender to secure
the obligations of Borrower under the Loan Documents. With respect to each
Mortgaged Property owned by a Borrower, the Security Instrument shall be
substantially in the form published by Fannie Mae for use in the state in which
the Mortgaged Property is located. The amount secured by the Security Instrument
shall be equal to the aggregate original principal amount of all Advances
Outstanding in effect from time to time.
“Selected Advance” has the meaning set forth in Section (d) (Application of
Release Price) of the Mortgaged Property Release Schedule.

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“Senior Management” means the Chief Executive Officer, the Chief Financial
Officer, the President, and the Co-President and the Executive Vice President of
Finance in each case of Key Principal, and each of their successors.
“Seniors Housing Facility” means a residential housing facility which qualifies
as “housing for older persons” under the Fair Housing Amendments Act of 1988 and
the Housing for Older Persons Act of 1995, and conforms to the Underwriting and
Servicing Requirements, and with respect to any Mortgaged Property, is comprised
of and licensed for use as identified on the Summary of Master Terms.
“Seniors Housing Facility Lease” if applicable, means, individually and
together, any Operating Lease or Sublease.
“Seniors Housing Facility Lease Request” has the meaning set forth in Section
7.02(g)(1) (Seniors Housing Facility Lease) of this Master Agreement.
“Seniors Housing Facility Licensing Designation” means the licensing designation
under the laws of the Property Jurisdiction, if applicable, for the Seniors
Housing Facility as set forth on the Summary of Master Terms.
“Servicing Arrangement” means any arrangement between Lender and the Loan
Servicer for loss sharing or interim advancement of funds.
“Single Purpose” means compliance with Section 4.01(h) (Borrower Status –
Representations and Warranties – Single Purpose Status) and Section 4.02(d)
(Borrower Status – Covenants – Single Purpose Status) of this Master Agreement.
“Skilled Nursing Property” means a Mortgaged Property comprised of one or more
skilled nursing units which are highly regulated and provide 24-hour resident
supervision and registered nursing care services.
“Springing Cap Security Agreement” means, individually and collectively, a
reserve and security agreement between Borrower and Lender, for the benefit of
Lender in the form required by Fannie Mae from time to time, which will be
issued by Borrower to Lender concurrently with the funding of a Variable Advance
where an Interest Rate Cap is not required pursuant to the terms thereof.
“Staggered Substitution” means a Substitution of Additional Mortgaged Property
that occurs subsequent to the release of the Release Mortgaged Property.
“Strike Rate” means:
(a)     In determining the Strike Rate for new Interest Rate Caps (other than
replacement Interest Rate Caps) purchased in connection with Future Advances
that are Variable Advances made under this Master Agreement, the Strike Rate
shall be the lower of (x) the percentage approved by Lender and (y) the
percentage derived by taking:
(1)    the Net Operating Income for all Mortgaged Properties, minus

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(A)    the product of (i) 1.40 and (ii) the payment due on each Fixed Advance
provided that:
(1)    each Fixed Advance to be obtained or Variable Advance to be converted
shall be deemed to require level monthly payments of principal and interest (at
an interest rate equal to the sum of (A) the base United States Treasury Index
Rate for securities having a maturity substantially similar to the maturity of
the Fixed Advance, plus (B) the Fixed Fee (or until rate locked, the estimated
Fixed Fee as determined pursuant to the Underwriting and Servicing
Requirements)) in an amount necessary to fully amortize the original principal
amount of the Fixed Advance over the Amortization Period (provided, however, if
there are no principal payments due on a Fixed Advance during the Interest Rate
Cap term for which the Strike Rate is being calculated, then the payments
relating to such Fixed Advance shall not be required to include principal
amortization for purposes of this calculation);
(2)    each Fixed Advance Outstanding shall be deemed to require level monthly
payments of principal and interest (at the Interest Rate for such Fixed Advance
as set forth in the Schedule of Advance Terms, in an amount necessary to fully
amortize the original principal amount of such Fixed Advance over the
Amortization Period) (provided, however, if there are no principal payments due
on a Fixed Advance during the Interest Rate Cap term for which the Strike Rate
is being calculated, then the payments relating to such Fixed Advance shall not
be required to include principal amortization for purposes of this calculation);
minus
(B)    the product of (i) 1.20 and (ii) the payment due on each Variable
Structured ARM Advance Outstanding, provided that each Variable Structured ARM
Advance Outstanding shall be deemed to require payments equal to the sum of (1)
monthly payments of principal and interest (with the interest rate calculated as
(A) the weighted average Strike Rate for all outstanding Interest Rate Caps plus
(B) the Margin applicable to such non-replacement Interest Rate Caps), in an
amount necessary to fully amortize the original principal amount of the Variable
Structured ARM Advance over the Amortization Period, and the principal component
of the Variable Structured ARM Advance payment(s) equal to the Fixed Monthly
Principal Component as set forth in the Schedule of Advance Terms), plus (2) the
Monthly Cap Escrow Payments, if any, for the succeeding twelve (12) month period
(provided, however, if there are no principal payments due on a Variable
Structured ARM Advance during the Interest Rate Cap term for which the Strike
Rate is being calculated, then the payments relating to such Variable Structured
ARM Advance

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shall not be required to include principal amortization for purposes of this
calculation). Notwithstanding the foregoing, if there are Variable Structured
ARM Advances Outstanding for which there are no Interest Rate Caps outstanding
at the time of the calculation, then such Variable Advances shall be included in
(3) below;

(2)    1.20
divided by
(3)    the total of all Variable Advances to be obtained or Variable Advances
Outstanding, that were not included in (a)(1)(B), at the time of the calculation
of the Strike Rate
minus
(4)    the amortization factor for all Variable Advances to be obtained or
Variable Advances Outstanding if principal is to be paid during the Interest
Rate Cap term
minus
(5)    the Margin (or for Variable Structured ARM Advances to be obtained, until
rate locked, the indicative pricing as determined pursuant to the Underwriting
and Servicing Requirements).
(b)    In determining the Strike Rate for any replacement Interest Rate Cap
purchased in connection with this Master Agreement pursuant to the Cap Security
Agreement, the Strike Rate shall be the lower of (x) the percentage approved by
Lender and (y) the percentage derived by taking:
(1)    the Net Operating Income for all Mortgaged Properties, minus
(A)    the product of (i) 1.40 and (ii) the payment due on each Fixed Advance
provided that each Fixed Advance Outstanding shall be deemed to require level
monthly payments of principal and interest (at the Interest Rate for such Fixed
Advance as set forth in the Schedule of Advance Terms), in an amount necessary
to fully amortize the original principal amount of such Fixed Advance over the
Amortization Period (provided, however, if there are no principal payments due
on a Fixed Advance during the Interest Rate Cap term for which the Strike Rate
is being calculated, then the payments relating to such Fixed Advance shall not
be required to include principal amortization for purposes of this calculation)
minus
(B)    the product of (i) 1.20 and (ii) the payment due on each Variable
Structured ARM Advance Outstanding where the applicable Interest Rate Cap is not

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being replaced in connection with the calculation of the Strike Rate, provided
that each Variable Structured ARM Advance Outstanding shall be deemed to require
payments equal to the sum of (1) monthly payments of principal and interest
(with the interest rate calculated as (A) the weighted average Strike Rate for
all outstanding Interest Rate Caps plus (B) the Margin applicable to such
non-replacement Interest Rate Caps), in an amount necessary to fully amortize
the original principal amount of the Variable Structured ARM Advance over the
Amortization Period, and the principal component of the Variable Structured ARM
Advance payment(s) equal to the Fixed Monthly Principal Component as set forth
in the Schedule of Advance Terms), plus (2) the Monthly Cap Escrow Payments, if
any, for the succeeding twelve (12) month period (provided, however, if there
are no principal payments due on a Variable Structured ARM Advance during the
Interest Rate Cap term for which the Strike Rate is being calculated, then the
payments relating to such Variable Structured ARM Advance shall not be required
to include principal amortization for purposes of this calculation).
Notwithstanding the foregoing, if there are Variable Structured ARM Advances
Outstanding for which there are no Interest Rate Caps outstanding at the time of
the calculation, then such Variable Advances shall be included in (3) below
divided by
(2)    1.20
divided by
(3)    the total of all Variable Advances Outstanding, that were not included in
(b)(1)(B), at the time of the calculation
minus
(4)    the amortization factor for all Variable Advances to be obtained or
Variable Advances Outstanding if principal is to be paid during the Interest
Rate Cap term
minus
(5)    the Margin (or for Variable Structured ARM Advances to be obtained, until
rate locked, the indicative pricing as determined pursuant to the Underwriting
and Servicing Requirements).
“Sublease” means, if applicable, any sublease or similar document as amended,
restated, replaced, supplemented or otherwise modified from time to time,
preapproved in writing by Lender, pursuant to which control of the occupancy,
use, operation, maintenance and administration of the Mortgaged Property as a
Seniors Housing Facility has been granted by an Operator as sub-lessor to any
Person (other than Borrower or Operator) as Sublessee.

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“Sublessee” means the Person responsible for the operation and management of the
Mortgaged Property pursuant to any Sublease.
“Substitution” has the meaning set forth in Section 2.10(d) (Right to
Substitutions).
“Substitution Cost Deposit” has the meaning set forth in the Mortgaged Property
Release Schedule.
“Substitution Costs” has the meaning set forth in the Mortgaged Property Release
Schedule.
“Substitution Deposit” has the meaning set forth in the Mortgaged Property
Release Schedule.
“Substitution Fee” means with respect to any Substitution effected in accordance
with Section 2.10(d) (Right to Substitutions), a fee in the amount which is the
greater of (a) forty basis points (40 bps) multiplied by the Allocable Facility
Amount of the Mortgaged Property being added in connection with the
Substitution, and (b) $35,000.
“Summary of Master Terms” means that certain Schedule 2 (Summary of Master
Terms) to this Master Agreement.
“Survey” means the as built survey of each Mortgaged Property prepared in
accordance with the Underwriting and Servicing Requirements.
“Taxes” has the meaning set forth in the Security Instrument.
“Term of this Master Agreement” means the period beginning on the Initial
Effective Date and ending on the Termination Date.
“Termination Date” means the earlier of (a) the date this Master Agreement is
terminated pursuant to a Termination Request and (b) at any time during which
Advances are Outstanding, the latest Maturity Date for any Advance Outstanding.
“Termination Documents” means the instruments releasing the Security Instruments
as liens on the Mortgaged Properties, UCC-3 Termination Statements terminating
the UCC-1 Financing Statements in favor of Lender, and such other documents and
instruments necessary to evidence the release of the Collateral from any Lien
securing the Indebtedness, and the Notes, all in connection with the termination
of this Master Agreement pursuant to Section 2.11 (Termination of Master
Agreement).
“Termination Request” means a written request, substantially in the form of
Exhibit F to this Master Agreement, to terminate this Master Agreement pursuant
to Section 2.11 (Termination of Master Agreement).
“Third Party Payments” means all payments and the rights to receive such
payments from Medicaid or other federal, state or local programs, boards,
bureaus or agencies, and from residents, private insurers or others relating to
the Mortgaged Property.

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“Three Month LIBOR” means the ICE Benchmark Administration Limited (or any
successor administrator) fixing of the London Inter-Bank Offered Rate for
three (3) month U.S. Dollar-denominated deposits as reported by Reuters through
electronic transmission. If the Index is no longer available, or is no longer
posted through electronic transmission, Lender will choose a new index that is
based upon comparable information and provide notice thereof to Borrower.
“Title Company” means the title company which provides title insurance for the
Mortgaged Property.
“Title Policy” means, individually and collectively, the mortgagee’s loan
policies of title insurance issued by the Title Company from time to time in
connection with the Advances and insuring the lien of the Security Instrument as
set forth therein, as approved by Lender, including any endorsements attached
thereto.
“Transfer” means:
(a)    as used with respect to Ownership Interests, (1) a sale, assignment,
pledge, grant or creation of a lien, encumbrance or security interest, transfer
or other disposition (whether voluntary, involuntary, or by operation of law) in
any right, title or interest in any Ownership Interest in a Borrower Entity,
Affiliated Property Operator, or Identified Party, or (2) the issuance or other
creation of new Ownership Interests in a Borrower Entity or Affiliated Property
Operator, or (3) a merger or consolidation of Borrower Entity, Affiliated
Property Operator, or Identified Party into another entity or of another entity
into Borrower Entity or Identified Party as the case may be, or (4) the
conversion of a Borrower Entity, Affiliated Property Operator, or Identified
Party from one type of entity to another type of entity, or (5) the amendment,
modification or any other change in the governing instrument or instruments of
Borrower Entity, Affiliated Property Operator, or Identified Party which has the
effect of changing the relative powers, rights, privileges, voting rights or
economic interests of the Ownership Interests in such Borrower Entity,
Affiliated Property Operator, or Identified Party; or (6) the withdrawal,
removal or involuntary resignation of any owner or manager of any Borrower
Entity, Affiliated Property Operator, or Identified Party;
(b)    as used with respect to a Mortgaged Property, (1) a sale, assignment,
lease, pledge, transfer or other disposition (whether voluntary or by operation
of law) other than Residential Leases, Material Commercial Leases or
non-Material Commercial Leases permitted by this Master Agreement, or (2) a
grant, pledge, creation or attachment of a lien, (other than a Permitted
Encumbrance), encumbrance or security interest (whether voluntary, involuntary,
or by operation of law) other than a Permitted Lien in, any estate, rights,
title or interest in the Mortgaged Property, or any portion thereof.
“Transfer Fee” means a fee equal to (i) one quarter percent (0.25%) of the
unpaid principal balance of the Advances Outstanding (or such lesser amount as
determined by Lender) payable to Lender in connection with such Transfers as set
forth in this Master Agreement for the first twenty-four (24) months of the Term
of this Master Agreement after the Initial Effective Date; and (ii) one half
percent (0.50%) of the unpaid principal balance of the Advances Outstanding (or
such lesser amount as determined by Lender) payable to Lender in connection with
such Transfers as set forth in this

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Master Agreement from and after the twenty-fifth (25th) month of the Term of
this Master Agreement after the Initial Effective Date.
“Treasury Regulations” means regulations, revenue rulings and other public
interpretations of the Internal Revenue Code by the Internal Revenue Service, as
such regulations, rulings and interpretations may be amended or otherwise
revised from time to time.
“UCC” has the meaning set forth in the Security Instrument.
“UCC Collateral” has the meaning set forth in the Security Instrument.
“Underwriting and Servicing Requirements” means Lender’s overall requirements
for Seniors Housing Facilities in connection with similar loans sold or
anticipated to be sold to Fannie Mae, pursuant to Fannie Mae’s then current
guidelines, including, requirements relating to appraisals, property condition
assessments, environmental site assessments, and servicing and asset management,
as such requirements may be amended, modified, updated, superseded, supplemented
or replaced from time to time.
“Valuation” means, for any specified date, with respect to a Multifamily
Residential Property, (a) if an Appraisal of the Multifamily Residential
Property was more recently obtained by Lender than a Capitalization Rate for the
Multifamily Residential Property, the Appraised Value of such Multifamily
Residential Property, or (b) if a Capitalization Rate for the Multifamily
Residential Property was more recently obtained by Lender than an Appraisal of
the Multifamily Residential Property, the value derived by dividing—
(1)    the Net Operating Income of such Multifamily Residential Property, by
(2)    the most recent Capitalization Rate determined by Lender.
Notwithstanding the foregoing, any Valuation for a Multifamily Residential
Property calculated for a date occurring before the first anniversary of the
date on which the Multifamily Residential Property becomes a part of the
Collateral Pool shall equal the Appraised Value of such Multifamily Residential
Property, unless Lender determines that changed market or property conditions
warrant that the value be determined as set forth in the preceding sentence.
“Variable Advance” means any variable rate execution approved by Lender
evidenced by a Variable Note.
“Variable Fee” means for any Variable Advance, the number of basis points per
annum determined at the time of funding of such Variable Advance by Lender as
the Variable Fee for such Variable Advance.
“Variable Note” means the promissory note (together with all schedules, riders,
allonges, addenda, renewals, extensions, amendments and modifications thereto),
which will be issued by Borrower to Lender, concurrently with the funding of
each Variable Advance, and which promissory note will be the same or
substantially similar in form to the then current form of promissory note
utilized by Fannie Mae for variable rate loans with the applicable type of loan
execution.

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“Variable Structured ARM Advance” means a loan made by Lender to Borrower that
is anticipated to be sold to Fannie Mae under the Fannie Mae Structured
Adjustable Rate Mortgage Program.
“Voidable Transfer” means any fraudulent conveyance, preference or other
voidable or recoverable payment of money or transfer of property.
“Waived Operator” means either (i) any Operator that is 100% owned and
controlled, whether directly or indirectly, by Guarantor, or (ii) if a Mortgaged
Property is managed by Manager that is 100% owned and controlled (whether
directly or indirectly) by Guarantor, the Manager of such Mortgaged Property.
“Yield Maintenance Period End Date” or “Prepayment Premium Period End Date” for
any Advance has the meaning set forth in the applicable Schedule of Advance
Terms.
“Yield Maintenance Period Term” or “Prepayment Premium Period Term” for any
Advance has the meaning set forth in the applicable Schedule of Advance Terms.
[Remainder of Page Intentionally Blank]

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INITIAL PAGE TO SCHEDULE 1 TO
MASTER CREDIT FACILITY AGREEMENT

Definitions Schedule

/s/ GTH    
Borrower Initials

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

SCHEDULE 2 TO
MASTER CREDIT FACILITY AGREEMENT
Summary of Master Terms
I.GENERAL PARTY AND MULTIFAMILY PROJECT INFORMATION
Borrower
ARC Scottsdale, LLC (TN)
FIT REN Nohl Ranch LP (DE)
FIT REN Park LP (DE)
FIT REN Mirage Inn LP (DE)
FIT REN The Gables LP (DE)
FIT REN Paulin Creek LP (DE)
FIT REN Ocean House LP (DE)
FIT REN Oak Tree LP (DE)
FIT REN Pacific Inn LP (DE)
AHC Sterling House of Brighton, LLC (DE)
AHC Villas of the Atrium, LLC (DE)
AHC Purchaser, Inc. (DE)
AHC Sterling House of Jacksonville, LLC (DE)
AHC Sterling House of Panama City, LLC (DE)
CMCP-Pinecastle, LLC (DE)
AHC Sterling House of Port Charlotte, LLC (DE)
AHC Sterling House of Punta Gorda, LLC (DE)
AHC Sterling House of Venice, LLC (DE)
CMCP-Roswell, LLC (DE)
AHC Villas-Wynwood of River Place, LLC (DE)
ARC Sweet Life Shawnee, LLC (TN)
ARCLP-Charlotte. LLC (TN)
ARC Wilora Assisted Living, LLC (TN)
CMCP-Montrose, LLC (DE)
ARC Westlake Village, Inc. (TN)
AHC Villas-Wynwood of Courtyard Albany, LLC (DE)
AHC Villas of Albany Residential, LLC (DE)
AHC Wynwood of Rogue Valley, LLC (DE)
CMCP-Club Hill, LLC (DE)
AHC Sterling House of Corsicana, LLC (DE)
Brookdale Cypress Station, LLC (DE)
Brookdale Lakeway, LLC (DE)
AHC Sterling House of Lewisville, LLC (DE)
AHC Sterling House of Mansfield, LLC (DE)
Brookdale Northwest Hills, LLC (DE)
AHC Sterling House of Weatherford, LLC (DE)
CMCP-Williamsburg, LLC (DE)

Lender
Jones Lang LaSalle Multifamily, LLC
Key Principal
Brookdale Senior Living Inc., a Delaware corporation
Guarantor
Brookdale Senior Living Inc., a Delaware corporation

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

Multifamily Project
Brookdale North Scottsdale
Brookdale Anaheim Hills
Brookdale Irvine
Brookdale Mirage Inn
Brookdale Monrovia
Brookdale Paulin Creek
Brookdale Santa Monica
Brookdale Scotts Valley
Brookdale South Bay
Brookdale Brighton AL
Brookdale North Boulder
Brookdale Leesburg AL
Brookdale Leesburg MC
Brookdale Mandarin Central
Brookdale Panama City
Brookdale Pinecastle
Brookdale Port Charlotte
Brookdale Port Orange
Brookdale Punta Gorda Isles
Brookdale Stuart
Brookdale Venice Island
Brookdale Chambrel Roswell
Brookdale Boise Parkcenter AL
Brookdale Boise Parkcenter IL
Brookdale Hays
Brookdale Shawnee MC
Brookdale W. Eisenhower Pkwy
Brookdale Carriage Club Providence
Brookdale Charlotte East
Brookdale Clinton MC
Brookdale Ithaca AL
Brookdale Ithaca MC
Brookdale Niagara AL
Brookdale Niagara MC
Brookdale Montrose
Brookdale Westlake Village
Brookdale Geary Street/Brookdale Grand Prairie IL
Brookdale Heritage Plaza
Brookdale Medford
Brookdale Club Hill
Brookdale Corsicana
Brookdale Cypress Station
Brookdale Lakeway AL/MC
Brookdale Lewisville
Brookdale Mansfield AL
Brookdale New Braunfels
Brookdale Northwest Hills
Brookdale Weatherford AL
Brookdale Williamsburg
Brookdale Pleasant Prairie
[portion of schedule omitted for SEC filing purposes]

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

Property Operator(s)
Brookdale North Scottsdale (AZ)
Operator: N/A

Brookdale Anaheim Hills (CA)
Operator: BLC Nohl Ranch, LLC (DE)

Brookdale Irvine (CA)
Operator: BLC Inn at the Park, LLC (DE)

Brookdale Mirage Inn (CA)
Operator: BLC Mirage Inn, L.P. (DE)

Brookdale Monrovia (CA)
Operator: BLC Gables-Monrovia, L.P. (DE)

Brookdale Paulin Creek (CA)
Operator: N/A

Brookdale Santa Monica (CA)
Operator: BLC Ocean House, L.P. (DE)

Brookdale Scotts Valley (CA)
Operator: BLC Oak Tree Villa, L.P. (DE)

Brookdale South Bay (CA)
Operator: N/A

Brookdale Brighton AL (CO)
Operator: Brookdale Senior Living Communities, Inc. (DE)

Brookdale North Boulder (CO)
Operator: Brookdale Senior Living Communities, Inc. (DE)

Brookdale Leesburg AL (FL)
Operator: Brookdale Senior Living Communities, Inc. (DE)

Brookdale Leesburg MC (FL)
Operator: Brookdale Senior Living Communities, Inc. (DE)

Brookdale Mandarin Central (FL)
Operator: Brookdale Senior Living Communities, Inc. (DE)

Brookdale Panama City (FL)
Operator: Brookdale Senior Living Communities, Inc. (DE)

Brookdale Pinecastle (FL)
Operator: N/A

Brookdale Port Charlotte (FL)
Operator: Brookdale Senior Living Communities, Inc. (DE)

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

Property Operator(s)
Brookdale Port Orange (FL)
Operator: Brookdale Senior Living Communities, Inc. (DE)

Brookdale Punta Gorda Isles (FL)
Operator: Brookdale Senior Living Communities, Inc. (DE)

Brookdale Stuart (FL)
Operator: Brookdale Senior Living Communities, Inc. (DE)

Brookdale Venice Island (FL)
Operator: Brookdale Senior Living Communities, Inc. (DE)

Brookdale Chambrel Roswell (GA)
Operator: Brookdale Management-II, LLC (DE)

Brookdale Boise Parkcenter AL (ID)
Operator: Brookdale Senior Living Communities, Inc. (DE)

Brookdale Boise Parkcenter IL (ID)
Operator: Brookdale Senior Living Communities, Inc. (DE)

Brookdale Hays (KS)
Operator: Brookdale Senior Living Communities, Inc. (DE)
Brookdale Shawnee MC (KS)
Operator: N/A

Brookdale W. Eisenhower Pkwy (MI)
Operator: Brookdale Senior Living Communities, Inc. (DE)

Brookdale Carriage Club Providence (NC)
Operator: N/A

Brookdale Charlotte East (NC)
Operator: N/A

Brookdale Clinton MC (NY)
Operator: Clinton Sterling Cottage Operator, Inc. (NY)

Brookdale Ithaca AL (NY)
Operator: SH Ithaca Operator, Inc. (VA)

Brookdale Ithaca MC (NY)
Operator: Ithaca Sterling Cottage Operator, Inc. (NY)

Brookdale Niagara AL (NY)
Operator: SH Niagara Operator, Inc. (VA)

Brookdale Niagara MC (NY)
Operator: Niagara Sterling Cottage Operator, Inc. (NY)

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

Property Operator(s)
Brookdale Montrose (OH)
Operator: N/A

Brookdale Westlake Village (OH)
Operator: ARC Westlake Village SNF, LLC (DE) (of SNF)

Brookdale Geary Street/Brookdale Grand Prairie IL (OR)
Operator: Brookdale Senior Living Communities, Inc. (DE)

Brookdale Heritage Plaza (OR)
Operator: Brookdale Senior Living Communities, Inc. (DE)

Brookdale Medford (OR)
Operator: Brookdale Senior Living Communities, Inc. (DE)

Brookdale Club Hill (TX)
Operator: BLC-Club Hill, LLC (DE)

Brookdale Corsicana (TX)
Operator: Brookdale Senior Living Communities, Inc. (DE)

Brookdale Cypress Station (TX)
Operator: N/A

Brookdale Lakeway AL/MC (TX)
Operator: N/A

Brookdale Lewisville (TX)
Operator: Brookdale Senior Living Communities, Inc. (DE)

Brookdale Mansfield AL (TX)
Operator: Brookdale Senior Living Communities, Inc. (DE)

Brookdale New Braunfels (TX)
Operator: Brookdale Senior Living Communities, Inc. (DE)

Brookdale Northwest Hills (TX)
Operator: N/A

Brookdale Weatherford AL (TX)
Operator: Brookdale Senior Living Communities, Inc. (DE)

Brookdale Williamsburg (VA)
Operator: N/A

Brookdale Pleasant Prairie (WI)
Operator: Brookdale Senior Living Communities, Inc. (DE)

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

Affiliated Property Operator(s)
BLC Nohl Ranch, LLC (DE)
BLC Inn at the Park, LLC (DE)
BLC Mirage Inn, L.P. (DE)
BLC Gables-Monrovia, L.P. (DE)
BLC Ocean House, L.P. (DE)
BLC Oak Tree Villa, L.P. (DE)
Brookdale Senior Living Communities, Inc. (DE)
Brookdale Management-II, LLC (DE)
Clinton Sterling Cottage Operator, Inc. (NY)
SH Ithaca Operator, Inc. (VA)
Ithaca Sterling Cottage Operator, Inc. (NY)
SH Niagara Sterling Cottage Operator, Inc. (NY)
ARC Westlake Village SNF, LLC (DE)
BLC-Club Hill, LLC (DE)
ARC Management, LLC (TN)
BLC Lodge at Paulin, L.P. (DE)
BLC Pacific Inn, L.P. (DE)
Alternative Living Services-New York, Inc. (DE)
Maximum Permitted Equipment Financing (excluding vehicles)
2% of Outstanding Advances
ADDRESSES
Borrower’s General Business Address
111 Westwood Place, Suite 400
Brentwood, TN 37027
Attention: General Counsel
Borrower’s Notice Address
c/o Brookdale Senior Living Inc.
111 Westwood Place, Suite 400
Brentwood, TN 37027
Attention: General Counsel

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

Multifamily Project Address
Brookdale North Scottsdale
15436 North 64th St
Scottsdale, AZ 85254

Brookdale Anaheim Hills
380 S. Anaheim Hills Rd
Anaheim Hills, CA 92807

Brookdale Irvine
10 Marquette
Irvine, CA 92612

Brookdale Mirage Inn
72750 Country Club Dr
Rancho Mirage, CA 92270

Brookdale Monrovia
201 E. Foothill Blvd
Monrovia, CA 91016

Brookdale Paulin Creek
2375 Range Ave
Santa Rosa, CA 95403

Brookdale Santa Monica
2107 Ocean Ave
Santa Monica, CA 90405

Brookdale Scotts Valley
100 Lockwood Lane
Scotts Valley, CA 95066

Brookdale South Bay
5481 W. Torrance Blvd
Torrance, CA 90503
 
Brookdale Brighton AL
2215 East Egbert St
Brighton, CO 80601

Brookdale North Boulder
3350 30th St
Boulder, CO 80301

Brookdale Leesburg AL
700 South Lake St
Leesburg, FL 34748

Brookdale Leesburg MC
710 South Lake St
Leesburg, FL 34748

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

Multifamily Project Address
Brookdale Mandarin Central
10875 Old Saint Augustine Rd
Jacksonville, FL 32257

Brookdale Panama City
2575 Harrison Ave
Panama City, FL 32405

Brookdale Pinecastle
1801 SE 24th Rd
Ocala, FL 34471

Brookdale Port Charlotte
18440 Cochran Blvd
Port Charlotte, FL 33948

Brookdale Port Orange
955 Village Trail
Port Orange, FL 32127

Brookdale Punta Gorda Isles
250 Bal Harbor Blvd
Punta Gorda, FL 33950

Brookdale Stuart
3401 South East Aster Ln
Stuart, FL 34994

Brookdale Venice Island
1200 Avenida del Circo
Venice, FL 34285

Brookdale Chambrel Roswell
1000 Applewood Dr
Roswell, GA 30076

Brookdale Boise Parkcenter AL
739 East Parkcenter Blvd
Boise, ID 83706

Brookdale Boise Parkcenter IL
767 East Parkcenter Blvd
Boise, ID 83706

Brookdale Hays
1801 East 27th St
Hays, KS 67601

Brookdale Shawnee MC
11400 West 65th St
Shawnee, KS 66203

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

Multifamily Project Address
Brookdale W. Eisenhower Pkwy
750 West Eisenhower Pkwy
Ann Arbor, MI 48103

Brookdale Carriage Club Providence
5800, 5802 and 5816 Old Providence Rd
Charlotte, NC 28226

Brookdale Charlotte East
6053 Wilora Lake Rd
Charlotte, NC 28212

Brookdale Clinton MC
115 Brookside Rd
Clinton, NY 13323

Brookdale Ithaca AL
103 Bundy Rd
Ithaca, NY 14850

Brookdale Ithaca MC
101 Bundy Rd
Ithaca, NY 14850

Brookdale Niagara AL
6741 Nash Rd
North Tonawanda, NY 14120

Brookdale Niagara MC
6751 Nash Rd
North Tonawanda, NY 14120
 
Brookdale Montrose
100 Brookmont Rd
Akron, OH 44333

Brookdale Westlake Village
28550 Westlake Village Dr
Westlake, OH 44145

Brookdale Geary Street/Brookdale Grand Prairie IL
2445 Southeast Geary St and 1929 Grand Prairie Rd South East
Albany, OR 97322
 
Brookdale Heritage Plaza
1560 Davidson St South East
Albany, OR 97322

Brookdale Medford
3033 Barnett Rd
Medford, OR 97504

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

Multifamily Project Address
Brookdale Club Hill
1245 Colonel Dr
Garland, TX 75043

Brookdale Corsicana
3329 West 7th Ave
Corsicana, TX 75110

Brookdale Cypress Station
303 Lantern Bend Dr
Houston, TX 77090

Brookdale Lakeway AL/MC
1915 Lohmans Crossing Rd
Austin, TX 78734

Brookdale Lewisville
965 Gardenridge Rd
Lewisville, TX 75077

Brookdale Mansfield AL
1771 Country Club Dr
Mansfield, TX 76063

Brookdale New Braunfels
2457 Loop 337
New Braunfels, TX 78130
 
Brookdale Northwest Hills
5715 Mesa Dr
Austin, TX 78731

Brookdale Weatherford AL
904 South Lamar St
Weatherford, TX 76086
 
Brookdale Williamsburg
3800 Treyburn Dr
Williamsburg, VA 23185

Brookdale Pleasant Prairie
7377 88th Ave
Kenosha, WI 53142
Key Principal’s General Business Address
111 Westwood Place, Suite 400
Brentwood, TN 37027
Key Principal’s Notice Address
c/o Brookdale Senior Living Inc.
111 Westwood Place, Suite 400
Brentwood, TN 37027
Attention: General Counsel
cwhite@brookdaleliving.com

With a copy to:

Brookdale Senior Living Inc.
111 Westwood Place, Suite 400
Brentwood, TN 37027
Attention: George T. Hicks, Executive Vice President and Treasurer
GHicks@brookdaleliving.com
Guarantor’s General Business Address
111 Westwood Place, Suite 400
Brentwood, TN 37027

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

Guarantor’s Notice Address
c/o Brookdale Senior Living Inc.
111 Westwood Place, Suite 400
Brentwood, TN 37027
Attention: General Counsel
cwhite@brookdaleliving.com

With a copy to:

Brookdale Senior Living Inc.
111 Westwood Place, Suite 400
Brentwood, TN 37027
Attention: George T. Hicks, Executive Vice President and Treasurer
GHicks@brookdaleliving.com
Lender’s General Business Address
Jones Lang LaSalle Multifamily, LLC
2177 Youngman Avenue
St. Paul, MN 55116
Lender’s Notice Address
Jones Lang LaSalle Multifamily LLC
2177 Youngman Avenue
St. Paul, Minnesota 55116
Attn: Loan Servicing
Email: loan_servicing@am.jll.com
Lender’s Payment Address
Jones Lang LaSalle Multifamily LLC
7322 Solution Center
Chicago, Illinois 60677-7002
Operator’s General Business Address
c/o Brookdale Senior Living Inc.
111 Westwood Place, Suite 400
Brentwood, TN 37027
Operator’s Notice Address
c/o Brookdale Senior Living Inc.
111 Westwood Place, Suite 400
Brentwood, TN 37027

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

II. RESERVE INFORMATION
Completion Period
Within timeframe after the Effective Date as shown on the Required Repair
Schedule
Initial Replacement Reserve Deposit
$0.00
Maximum Inspection Fee
$500.00
Maximum Repair Disbursement Interval
One time per calendar month
Maximum Replacement Reserve Disbursement Interval
One time per calendar quarter
Minimum Repairs Disbursement Amount
$5,000.00
Minimum Replacement Reserve Disbursement Amount
$5,000.00
Monthly Replacement Reserve Deposit
See Schedule 5
Repair Threshold
$10,000.00
Repairs Escrow Account Administrative Fee
$0
Repairs Escrow Deposit
See Schedule 6

Replacement Reserve Account Administration Fee
$0
Replacement Reserve Account Interest Disbursement Frequency
Annually
Replacement Threshold
$10,000.00

[Remainder of Page Intentionally Blank]

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

INITIAL PAGE TO SCHEDULE 2 TO
MASTER CREDIT FACILITY AGREEMENT

Summary of Master Terms

/s/ GTH    
Borrower Initials

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

SCHEDULE 2A TO
MASTER CREDIT FACILITY AGREEMENT
(New York Gap Note Modifications)
The Master Agreement is hereby modified as follows:
1.Capitalized terms used and not specifically defined herein have the meanings
given to such terms in the Master Agreement.

2.The Definitions Schedule is hereby amended by adding the following new
definitions in the appropriate alphabetical order:
“Consolidated Note” means that certain Consolidated, Amended and Restated
Multifamily Note dated August 31, 2017 in the amount of $292,500,000 including
all schedules, riders, allonges, and addenda attached thereto, as the same may
be amended, restated, replaced, supplemented or otherwise modified from time to
time, which amends, restates, consolidates and supersedes the GAP Note.
“Consolidated Security Instrument” means the Consolidation, Extension and
Modification Agreement by AHC Purchaser, Inc., a Delaware corporation, and
Lender dated as of August 31, 2017 including all riders or schedules attached
thereto, as the same may be amended, restated, replaced, supplemented or
otherwise modified from time to time, which amends, restates, consolidates and
supersedes the GAP Security Instrument.
“GAP Note” has the meaning set forth in Schedule 3.1 (Schedule of Advance
Terms).
“GAP Security Instrument” means that certain Multifamily Mortgage, Assignment of
Leases and Rents, Security Instrument and Fixture Filing by AHC Purchaser, Inc.,
a Delaware corporation, as security for the Advance evidenced by the Gap Note
and encumbering the Mortgaged Property, known as Idlewild, including all riders
or schedules attached thereto, as the same may be amended, restated, replaced,
supplemented or otherwise modified from time to time.
“Monthly GAP Debt Service Payment” has the meaning set forth in the Schedule 3.1
(Schedule of Advance Terms).
3.The Monthly Gap Debt Service Payment is included within the Monthly Debt
Service Payment for the Consolidated Note.

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INITIAL PAGE TO SCHEDULE 2A TO
MASTER CREDIT FACILITY AGREEMENT
(New York Gap Note Modifications)

/s/ GTH    
Borrower Initials

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SCHEDULE 3.1 TO
MASTER CREDIT FACILITY AGREEMENT

Schedule of Advance Terms – Gap Note

FIXED ADVANCE
III. INFORMATION FOR $847,500 FIXED ADVANCE MADE AUGUST 31, 2017

Monthly GAP Debt Service Payment
PROVISIONS FOR THE GAP NOTE:
For Amortizing (30/360 or Actual/360), and for Full Term Interest Only (30/360):
$4,258.98

 
IV. GAP NOTE
GAP Note
That certain GAP Multifamily Note dated as of August 31, 2017 in the original
principal amount of $847,500.00 made by Borrower in favor of Lender, and all
schedules, riders, allonges and addenda attached thereto, as the same may be
amended, restated, replaced, supplemented or otherwise modified from time to
time. The Note amends, restates, consolidates and supersedes the Gap Note.
 

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INITIAL PAGE TO SCHEDULE 3.1 TO
MASTER CREDIT FACILITY AGREEMENT
Schedule of Advance Terms – GAP Note

/s/ GTH    
Borrower Initials

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SCHEDULE 3.2 TO
MASTER CREDIT FACILITY AGREEMENT

Schedule of Advance Terms
FIXED ADVANCE

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III. INFORMATION FOR $292,500,000 ADVANCE
MADE AUGUST 31, 2017
Advance Amount
$292,500,000
Advance Term
84 months
Advance Year
The period beginning on the Effective Date and ending on the last day of August,
2018, and each successive twelve (12) month period thereafter.
Amortization Type
[Select only one:]
x  Amortizing
o  Full Term Interest Only
o  Partial Interest Only
Effective Date
August 31, 2017.
First Payment Date
The first day of October, 2017.
First Principal and Interest Payment Date
Not Applicable
Fixed Rate
4.43%
Interest Accrual Method
[Select only one:]
o   30/360 (computed on the basis of a three hundred sixty (360) day year
consisting of twelve (12) thirty (30) day months).
or
x  Actual/360 (computed on the basis of a three hundred sixty (360) day year and
the actual number of calendar days during the applicable month, calculated by
multiplying the unpaid principal balance of the Advance by the Interest Rate,
dividing the product by three hundred sixty (360), and multiplying the quotient
obtained by the actual number of days elapsed in the applicable month).
Interest Only Term
0 months
Interest Rate
The Fixed Rate
Interest Rate Type
Fixed Rate
Last Interest Only Payment Date
Not Applicable
Maturity Date
The first day of September, 2024, or any earlier date on which the unpaid
principal balance of the Advance becomes due and payable by acceleration or
otherwise.
Monthly Debt Service Payment
$1,469,913.63
Prepayment Lockout Period
0 year(s) from the Effective Date
Remaining Amortization Period
As of each Payment Date, the Amortization Period minus the number of scheduled
Monthly Debt Service Payments that have elapsed since the Effective Date.

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IV. YIELD MAINTENANCE/PREPAYMENT PREMIUM INFORMATION
Yield Maintenance Period End Date
or
Prepayment Premium Period End Date
The last day of February, 2024.
Yield Maintenance Period Term
or
Prepayment Premium Period Term
78 months

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INITIAL PAGE TO SCHEDULE 3.2 TO
MASTER CREDIT FACILITY AGREEMENT

Schedule of Advance Terms

/s/ GTH    
Borrower Initials

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SCHEDULE 3.3 TO
MASTER CREDIT FACILITY AGREEMENT

Schedule of Advance Terms
FIXED ADVANCE

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III. INFORMATION FOR $292,500,000 ADVANCE
MADE AUGUST 31, 2017
Advance Amount
$292,500,000
Advance Term
120 months
Advance Year
The period beginning on the Effective Date and ending on the last day of August,
2018, and each successive twelve (12) month period thereafter.
Amortization Type
[Select only one:]
x   Amortizing
o   Full Term Interest Only
o   Partial Interest Only
Effective Date
August 31, 2017.
First Payment Date
The first day of October, 2017.
First Principal and Interest Payment Date
Not Applicable
Fixed Rate
4.47%
Interest Accrual Method
[Select only one:]
o   30/360 (computed on the basis of a three hundred sixty (360) day year
consisting of twelve (12) thirty (30) day months).
or
x   Actual/360 (computed on the basis of a three hundred sixty (360) day year
and the actual number of calendar days during the applicable month, calculated
by multiplying the unpaid principal balance of the Advance by the Interest Rate,
dividing the product by three hundred sixty (360), and multiplying the quotient
obtained by the actual number of days elapsed in the applicable month).
Interest Only Term
0 months
Interest Rate
The Fixed Rate
Interest Rate Type
Fixed Rate
Last Interest Only Payment Date
Not Applicable
Maturity Date
The first day of September, 2027, or any earlier date on which the unpaid
principal balance of the Advance becomes due and payable by acceleration or
otherwise.
Monthly Debt Service Payment
$1,476,845.19
Prepayment Lockout Period
0 year(s) from the Effective Date
Remaining Amortization Period
As of each Payment Date, the Amortization Period minus the number of scheduled
Monthly Debt Service Payments that have elapsed since the Effective Date.

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IV. YIELD MAINTENANCE/PREPAYMENT PREMIUM INFORMATION
Yield Maintenance Period End Date
or
Prepayment Premium Period End Date
The last day of February, 2027.
Yield Maintenance Period Term
or
Prepayment Premium Period Term
114 months

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INITIAL PAGE TO SCHEDULE 3.3 TO
MASTER CREDIT FACILITY AGREEMENT

Schedule of Advance Terms

/s/ GTH    
Borrower Initials

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SCHEDULE 3.4 TO
MASTER CREDIT FACILITY AGREEMENT

Schedule of Advance Terms

VARIABLE STRUCTURED ARM ADVANCE
III. INFORMATION FOR $390,000,000 VARIABLE ADVANCE MADE AUGUST 31, 2017
Adjustable Rate
Until the first Rate Change Date, the Initial Adjustable Rate, and from and
after each Rate Change Date following the first Rate Change Date until the next
Rate Change Date, a per annum interest rate that is the sum of (i) the Current
Index, and (ii) the Margin, which sum is then rounded to the nearest three (3)
decimal places; provided, however, that the Adjustable Rate shall never be less
than the Margin.
Advance Amount
$390,000,000
Advance Term
120 months.
Advance Year
The period beginning on the Effective Date and ending on the last day of August,
2018 and each successive twelve (12) month period thereafter.
Amortization Type
[Select only one:]
x  Amortizing
o  Full Term Interest Only
o Partial Interest Only
Current Index
The published Index that is effective on the Business Day immediately preceding
the applicable Rate Change Date.
Effective Date
August 31, 2017
First Payment Date
The first day of October, 2017.
First Principal and Interest Payment Date
Not Applicable
Fixed Monthly Principal Component
$625,448.95
Fixed Rate Amortization Factor
4.47% per annum
Index
One-Month Libor
Initial Adjustable Rate
3.646% per annum.
Initial Monthly Debt Service Payment
$1,810,398.95

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III. INFORMATION FOR $390,000,000 VARIABLE ADVANCE MADE AUGUST 31, 2017
Interest Accrual Method
Actual/360 (computed on the basis of a three hundred sixty (360) day year and
the actual number of calendar days during the applicable month, calculated by
multiplying the unpaid principal balance of the Advance by the Interest Rate,
dividing the product by three hundred sixty (360), and multiplying the quotient
obtained by the actual number of days elapsed in the applicable month).
Interest Only Term
0 months.
Interest Rate Type
Structured ARM
Last Interest Only Payment Date

Not Applicable
Margin
2.415%
Maturity Date
The first day of September, 2027, or any later date to which the Maturity Date
may be extended (if at all) pursuant to this Master Agreement in connection with
an election by Borrower to convert the Interest Rate on the Advance to a fixed
rate pursuant to the terms of this Master Agreement, or any earlier date on
which the unpaid principal balance of the Advance becomes due and payable by
acceleration or otherwise.
Monthly Debt Service Payment
For Amortizing:
(i) for the First Payment Date, the Initial Monthly Debt Service Payment, and
(ii) for each Payment Date following the First Payment Date, until the Advance
is fully paid, an amount equal to the sum of:
(1) the Fixed Monthly Principal Component; plus
(2) an interest payment equal to the amount obtained by multiplying the unpaid
principal balance of the Advance by the Adjustable Rate, dividing the product by
three hundred sixty (360), and multiplying the quotient by the actual number of
days elapsed in the applicable month.
Payment Change Date
The first (1st) day of the month following each Rate Change Date until the
Advance is fully paid.
Prepayment Lockout Period
The first (1st) Advance Year of the term of the Advance.
Rate Change Date
The First Payment Date and the first (1st) day of each month thereafter until
the Advance is fully paid.

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III. INFORMATION FOR $390,000,000 VARIABLE ADVANCE MADE AUGUST 31, 2017
Remaining Amortization Period
As of each Payment Date, the Amortization Period minus the number of scheduled
Monthly Debt Service Payments that have elapsed since the Effective Date.

IV. YIELD MAINTENANCE/PREPAYMENT PREMIUM INFORMATION
Prepayment Premium Term
The period beginning on the Effective Date and ending on the last calendar day
of the fourth (4th) month prior to the month in which the Maturity Date occurs.

[Remainder of Page Intentionally Blank]

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INITIAL PAGE TO SCHEDULE 3.4 TO
MASTER CREDIT FACILITY AGREEMENT

Schedule of Advance Terms

/s/ GTH    
Borrower Initials

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SCHEDULE 4.1 TO
MASTER CREDIT FACILITY AGREEMENT
Prepayment Premium Schedule for Gap Note

Prepayment Premium Schedule

(Standard Yield Maintenance – Fixed Rate)

1.    Defined Terms.
All capitalized terms used but not defined in this Prepayment Premium Schedule
shall have the meanings assigned to them in the Master Agreement.
2.    Prepayment Premium.
Any Prepayment Premium payable under Section 2.04 (Prepayment; Prepayment
Lockout; Prepayment Premium) of the Master Agreement shall be computed as
follows:
(a)    If the prepayment is made at any time after the Effective Date and before
the Yield Maintenance Period End Date, the Prepayment Premium shall be the
greater of:
(1)
one percent (1%) of the amount of principal being prepaid; or

(2)
the product obtained by multiplying:

(i)    the amount of principal being prepaid,
by
(ii)    the difference obtained by subtracting from the Fixed Rate on the
Mortgage Loan, the Yield Rate (as defined below) on the twenty-fifth (25th)
Business Day preceding (i) the Intended Prepayment Date, or (ii) the date Lender
accelerates the Mortgage Loan or otherwise accepts a prepayment pursuant to
Section 2.06 (Application of Collateral) of the Master Agreement,
by
(iii)    the present value factor calculated using the following formula:
(1 - (1 + r)-n/12) / r
[r =    Yield Rate
n =
the number of months remaining between (i) either of the following: (x) in the
case of a voluntary prepayment, the last day of the month in which the
prepayment is made, or (y) in

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

any other case, the date on which Lender accelerates the unpaid principal
balance of the Mortgage Loan and (ii) the Yield Maintenance Period End Date.
For purposes of this clause (2), the “Yield Rate” means the yield calculated by
interpolating the yields for the immediately shorter and longer term U.S.
“Treasury constant maturities” (as reported in the Federal Reserve Statistical
Release H.15 Selected Interest Rates (the “Fed Release”) under the heading “U.S.
government securities”) closest to the remaining term of the Yield Maintenance
Period Term, as follows (rounded to three (3) decimal places):
(((a – b) / (x – y)) * (z – y)) + b
a =
the yield for the longer U.S. Treasury constant maturity

b =
the yield for the shorter U.S. Treasury constant maturity

x =
the term of the longer U.S. Treasury constant maturity

y =
the term of the shorter U.S. Treasury constant maturity

z =
“n” (as defined in the present value factor calculation above) divided by
twelve (12).

Notwithstanding any provision to the contrary, if “z” equals a term reported
under the U.S. “Treasury constant maturities” subheading in the Fed Release, the
yield for such term shall be used, and interpolation shall not be necessary. If
publication of the Fed Release is discontinued by the Federal Reserve Board,
Lender shall determine the Yield Rate from another source selected by Lender.
Any determination of the Yield Rate by Lender will be binding absent manifest
error.]
(b)    If the prepayment is made on or after the Yield Maintenance Period End
Date but before the last calendar day of the fourth (4th) month prior to the
month in which the Maturity Date occurs, the Prepayment Premium shall be one
percent (1%) of the amount of principal being prepaid.
(c)    Notwithstanding the provisions of Section 2.04 (Prepayment; Prepayment
Lockout; Prepayment Premium) of the Master Agreement, no Prepayment Premium
shall be payable with respect to any prepayment made on or after the last
calendar day of the fourth (4th) month prior to the month in which the Maturity
Date occurs.

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INITIAL PAGE TO SCHEDULE 4.1 TO
MASTER CREDIT FACILITY AGREEMENT

Prepayment Premium Schedule

/s/ GTH    
Borrower Initials

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SCHEDULE 4.2 TO
MASTER CREDIT FACILITY AGREEMENT

Prepayment Premium Schedule

(Standard Yield Maintenance – Fixed Rate)

1.    Defined Terms.
All capitalized terms used but not defined in this Prepayment Premium Schedule
shall have the meanings assigned to them in the Master Agreement.
2.    Prepayment Premium.
Any Prepayment Premium payable under Section 2.04 (Prepayment; Prepayment
Lockout; Prepayment Premium) of the Master Agreement shall be computed as
follows:
(a)    If the prepayment is made at any time after the Effective Date and before
the Yield Maintenance Period End Date, the Prepayment Premium shall be the
greater of:
(1)
one percent (1%) of the amount of principal being prepaid; or

(2)
the product obtained by multiplying:

(i)    the amount of principal being prepaid,
by
(ii)    the difference obtained by subtracting from the Fixed Rate on the
Mortgage Loan, the Yield Rate (as defined below) on the twenty-fifth (25th)
Business Day preceding (i) the Intended Prepayment Date, or (ii) the date Lender
accelerates the Mortgage Loan or otherwise accepts a prepayment pursuant to
Section 2.06 (Application of Collateral) of the Master Agreement,
by
(iii)    the present value factor calculated using the following formula:
(1 - (1 + r)-n/12) / r
[r =    Yield Rate
n =
the number of months remaining between (i) either of the following: (x) in the
case of a voluntary prepayment, the last day of the month in which the
prepayment is made, or (y) in any other case, the date on which Lender
accelerates the

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

unpaid principal balance of the Mortgage Loan and (ii) the Yield Maintenance
Period End Date.
For purposes of this clause (2), the “Yield Rate” means the yield calculated by
interpolating the yields for the immediately shorter and longer term U.S.
“Treasury constant maturities” (as reported in the Federal Reserve Statistical
Release H.15 Selected Interest Rates (the “Fed Release”) under the heading “U.S.
government securities”) closest to the remaining term of the Yield Maintenance
Period Term, as follows (rounded to three (3) decimal places):
(((a – b) / (x – y)) * (z – y)) + b
a =
the yield for the longer U.S. Treasury constant maturity

b =
the yield for the shorter U.S. Treasury constant maturity

x =
the term of the longer U.S. Treasury constant maturity

y =
the term of the shorter U.S. Treasury constant maturity

z =
“n” (as defined in the present value factor calculation above) divided by
twelve (12).

Notwithstanding any provision to the contrary, if “z” equals a term reported
under the U.S. “Treasury constant maturities” subheading in the Fed Release, the
yield for such term shall be used, and interpolation shall not be necessary. If
publication of the Fed Release is discontinued by the Federal Reserve Board,
Lender shall determine the Yield Rate from another source selected by Lender.
Any determination of the Yield Rate by Lender will be binding absent manifest
error.]
(b)    If the prepayment is made on or after the Yield Maintenance Period End
Date but before the last calendar day of the fourth (4th) month prior to the
month in which the Maturity Date occurs, the Prepayment Premium shall be one
percent (1%) of the amount of principal being prepaid.
(c)    Notwithstanding the provisions of Section 2.04 (Prepayment; Prepayment
Lockout; Prepayment Premium) of the Master Agreement, no Prepayment Premium
shall be payable with respect to any prepayment made on or after the last
calendar day of the fourth (4th) month prior to the month in which the Maturity
Date occurs.

[Remainder of Page Intentionally Blank]

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INITIAL PAGE TO SCHEDULE 4.2 TO
MASTER CREDIT FACILITY AGREEMENT

Prepayment Premium Schedule

/s/ GTH    
Borrower Initials

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SCHEDULE 4.3 TO
MASTER CREDIT FACILITY AGREEMENT

Prepayment Premium Schedule

(Standard Yield Maintenance – Fixed Rate)

1.    Defined Terms.
All capitalized terms used but not defined in this Prepayment Premium Schedule
shall have the meanings assigned to them in the Master Agreement.
2.    Prepayment Premium.
Any Prepayment Premium payable under Section 2.04 (Prepayment; Prepayment
Lockout; Prepayment Premium) of the Master Agreement shall be computed as
follows:
(a)    If the prepayment is made at any time after the Effective Date and before
the Yield Maintenance Period End Date, the Prepayment Premium shall be the
greater of:
(1)
one percent (1%) of the amount of principal being prepaid; or

(2)
the product obtained by multiplying:

(i)    the amount of principal being prepaid,
by
(ii)    the difference obtained by subtracting from the Fixed Rate on the
Mortgage Loan, the Yield Rate (as defined below) on the twenty-fifth (25th)
Business Day preceding (i) the Intended Prepayment Date, or (ii) the date Lender
accelerates the Mortgage Loan or otherwise accepts a prepayment pursuant to
Section 2.06 (Application of Collateral) of the Master Agreement,
by
(iii)    the present value factor calculated using the following formula:
(1 - (1 + r)-n/12) / r
[r =    Yield Rate
n =
the number of months remaining between (i) either of the following: (x) in the
case of a voluntary prepayment, the last day of the month in which the
prepayment is made, or (y) in any other case, the date on which Lender
accelerates the

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

unpaid principal balance of the Mortgage Loan and (ii) the Yield Maintenance
Period End Date.
For purposes of this clause (2), the “Yield Rate” means the yield calculated by
interpolating the yields for the immediately shorter and longer term U.S.
“Treasury constant maturities” (as reported in the Federal Reserve Statistical
Release H.15 Selected Interest Rates (the “Fed Release”) under the heading “U.S.
government securities”) closest to the remaining term of the Yield Maintenance
Period Term, as follows (rounded to three (3) decimal places):
(((a – b) / (x – y)) * (z – y)) + b
a =
the yield for the longer U.S. Treasury constant maturity

b =
the yield for the shorter U.S. Treasury constant maturity

x =
the term of the longer U.S. Treasury constant maturity

y =
the term of the shorter U.S. Treasury constant maturity

z =
“n” (as defined in the present value factor calculation above) divided by
twelve (12).

Notwithstanding any provision to the contrary, if “z” equals a term reported
under the U.S. “Treasury constant maturities” subheading in the Fed Release, the
yield for such term shall be used, and interpolation shall not be necessary. If
publication of the Fed Release is discontinued by the Federal Reserve Board,
Lender shall determine the Yield Rate from another source selected by Lender.
Any determination of the Yield Rate by Lender will be binding absent manifest
error.]
(b)    If the prepayment is made on or after the Yield Maintenance Period End
Date but before the last calendar day of the fourth (4th) month prior to the
month in which the Maturity Date occurs, the Prepayment Premium shall be one
percent (1%) of the amount of principal being prepaid.
(c)    Notwithstanding the provisions of Section 2.04 (Prepayment; Prepayment
Lockout; Prepayment Premium) of the Master Agreement, no Prepayment Premium
shall be payable with respect to any prepayment made on or after the last
calendar day of the fourth (4th) month prior to the month in which the Maturity
Date occurs.

[Remainder of Page Intentionally Blank]

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INITIAL PAGE TO SCHEDULE 4.3 TO
MASTER CREDIT FACILITY AGREEMENT

Prepayment Premium Schedule

/s/ GTH    
Borrower Initials

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SCHEDULE 4.4 TO
MASTER CREDIT FACILITY AGREEMENT

Prepayment Premium Schedule

(1% Prepayment Premium – ARM, SARM)

1.    Defined Terms.
All capitalized terms used but not defined in this Prepayment Premium Schedule
shall have the meanings assigned to them in the Master Agreement.
2.    Prepayment Premium.
(a)    Any Prepayment Premium payable under Section 2.04 (Prepayment; Prepayment
Lockout; Prepayment Premium) of the Master Agreement shall be equal to the
following percentage of the amount of principal being prepaid at the time of
such prepayment, acceleration or application:
Prepayment Lockout Period
5.00%
Second Advance Year, and each Loan Year thereafter
1.00%

(b)    Notwithstanding the provisions of Section 2.04 (Prepayment; Prepayment
Lockout; Prepayment Premium) of the Master Agreement or anything to the contrary
in this Prepayment Premium Schedule, no Prepayment Premium shall be payable with
respect to any prepayment made on or after the last calendar day of the
fourth (4th) month prior to the month in which the Maturity Date occurs.

[Remainder of Page Intentionally Blank]

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INITIAL PAGE TO SCHEDULE 4.4 TO
MASTER CREDIT FACILITY AGREEMENT

Prepayment Premium Schedule

/s/ GTH    
Borrower Initials

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SCHEDULE 5 TO
MASTER CREDIT FACILITY AGREEMENT

[omitted for SEC filing purposes]

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SCHEDULE 6 TO
MASTER CREDIT FACILITY AGREEMENT

[omitted for SEC filing purposes]

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SCHEDULE 7 TO
MASTER CREDIT FACILITY AGREEMENT

General Conditions Schedule

Borrower’s right to close any transaction requested in a Request (other than a
Termination Request) shall be subject to satisfaction of the following General
Conditions precedent, in addition to any other applicable conditions precedent
contained in this Master Agreement:
(a)    No Material Adverse Effect.
There has been no Material Adverse Effect since the date of the most recent
Compliance Certificate that has not been cured.
(b)    No Default.
There shall exist no Event of Default or Potential Event of Default (that is not
otherwise cured by the closing of such Request). The closing of such Request
shall not result in an Event of Default or Potential Event of Default.
(c)    No Insolvency.
Receipt by Lender on the Effective Date for the Request of evidence satisfactory
to Lender that neither Borrower nor Affiliated Property Operator nor any general
partner or sole member of Borrower nor Affiliated Property Operator is Insolvent
or will be rendered Insolvent by the transactions contemplated by the Loan
Documents or, after giving effect to such transactions, will be left with an
unreasonably small capital with which to engage in its business or undertakings,
or will have intended to incur, or believe that it has incurred, debts beyond
its ability to pay such debts as they mature or will have intended to hinder,
delay or defraud any existing or future creditor.
(d)    Representations and Warranties.
All representations and warranties made by Borrower, Affiliated Property
Operator, and Guarantor in the Loan Documents shall be true and correct on the
Effective Date for the Request with the same force and effect as if such
representations and warranties had been made on and as of the Effective Date for
the Request.
(e)    Payment of Expenses.
The payment by Borrower of Lender’s and Fannie Mae’s reasonable third party
out-of-pocket fees and expenses payable in accordance with this Master
Agreement, including the legal fees and expenses described in Section 4.02(g)
(Payments of Costs, Fees, and Expenses) of this Master Agreement whether or not
the Request closes; provided, however, if Borrower makes a Request and fails to
close on a Request for any reason other than the default by Lender, then
Borrower shall also pay to Lender and Fannie Mae all actual damages incurred by
Lender and Fannie Mae in connection with the failure to close.

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

(f)    No Untrue Statements.
The Loan Documents shall not contain any untrue or misleading statement of a
material fact and shall not fail to state a material fact necessary to make the
information contained therein not misleading.
(g)    Covenants.
Borrower and Guarantor are in full compliance with each of the covenants
contained in the Loan Documents and Affiliated Property Operator is in
compliance with the covenants in the SASA, without giving effect to any notice
and cure rights of Borrower, Affiliated Property Operator, or Guarantor.
(h)    Delivery of Closing Documents.
The receipt by Lender of the following, each dated as of the Effective Date for
the Request, in form and substance satisfactory to Lender in all respects:
(1)    the Loan Documents relating to such Request including a Compliance
Certificate and an Organizational Certificate; and
(2)    such other documents, instruments, approvals (and, if requested by
Lender, certified duplicates of executed copies thereof) and opinions as Lender
may reasonably request.

[Remainder of Page Intentionally Blank]

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INITIAL PAGE TO SCHEDULE 7 TO
MASTER CREDIT FACILITY AGREEMENT

General Conditions Schedule

/s/ GTH    
Borrower Initials

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SCHEDULE 8 TO
MASTER CREDIT FACILITY AGREEMENT

Property-Related Documents Schedule

With respect to any Additional Mortgaged Property or Future Advance, it shall be
a condition precedent that Lender receive from Borrower each of the documents
and reports required by Lender in connection with the addition of such Mortgaged
Property to the Collateral Pool or making of such Future Advance and, each of
the following, each dated as of the applicable Effective Date, in form and
substance satisfactory to Lender in all respects (the “Property-Related
Documents”):
(a)    a commitment for the Title Policy applicable to each Mortgaged Property
being added and a pro forma Title Policy based on the commitment in the amount
of title insurance afforded by the Title Policy for each Mortgaged Property
being added to the Collateral Pool (1) if tie-in endorsements are available for
all or a portion of the Mortgaged Properties, in an aggregate amount equal to
the combined Allocable Facility Amounts for all of the Mortgaged Properties
covered by the tie-in endorsements, not to exceed the amount of the aggregate
original principal amount of all Advances Outstanding, or (2) if a tie-in
endorsement is not available for any Mortgaged Property, then with respect to
such Mortgaged Properties not subject to the tie-in endorsement an amount equal
to one hundred twenty-five percent (125%) of the Valuation of such Mortgaged
Property not subject to the tie-in endorsement (or such lesser amount that is
the maximum allowed by law or regulation);
(b)    a Security Instrument for each Additional Mortgaged Property. The amount
secured by each Security Instrument shall be equal to the aggregate original
principal amount of all Advances Outstanding in effect from time to time;
(c)    a SASA for each Additional Mortgaged Property;
(d)    a title instruction letter directing the Title Company to file and/or
record in all applicable jurisdictions, all applicable Loan Documents required
by Lender to be filed or recorded, including duly executed and delivered
original copies of the Security Instruments covering the applicable Mortgaged
Properties and UCC-1 Financing Statements covering the portion of the Collateral
comprised of personal property, and other appropriate instruments, in form and
substance satisfactory to Lender and in form proper for recordation, as may be
necessary in the opinion of Lender to perfect the Liens created by the
applicable Security Instruments and SASAs and any other Loan Documents creating
a Lien in favor of Lender, and the payment of all taxes, fees and other charges
payable in connection with such execution, delivery, recording and filing;
(e)    if the Title Policy for an Additional Mortgaged Property contains a
tie-in endorsement (as available), an endorsement to each Title Policy for each
Mortgaged Property in the Collateral Pool containing a tie-in endorsement,
adding a reference to the Additional Mortgaged Property;
(f)    if required by Lender, amendments to this Master Agreement, the Notes,
the existing Security Instruments, and the SASAs, reflecting any Addition,
Substitution or Future Advance and increase in the secured amount of each
Security Instrument, if applicable, and, as to any Security

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Instrument, the SASAs, or Note so amended or if Lender determines that such
endorsement is necessary to maintain the priority of the Lien created in favor
of Lender with respect to the Outstanding Indebtedness or to maintain the
validity of any Title Policy, the receipt by Lender of an endorsement to each
Title Policy insuring the amended Security Instruments, amending the effective
date of each Title Policy to the Effective Date and showing no additional
exceptions to coverage other than the exceptions shown on the initial Effective
Date for such Mortgaged Property, Permitted Encumbrances and other exceptions
approved by Lender, together with any reinsurance agreements required by Lender;
(g)    clean UCC searches, judgment searches and tax lien searches on Borrower,
its direct owners, Affiliated Property Operator, Guarantor and other Identified
Parties;
(h)    the Insurance Policy (or a certified copy of the Insurance Policy)
applicable to the Additional Mortgaged Property;
(i)    unless waived by Lender, the Survey applicable to the Additional
Mortgaged Property and approved by Lender (which shall be last revised no less
than forty-five (45) days prior to the applicable Effective Date);
(j)    either (1) (A) letters or other evidence with respect to the Additional
Mortgaged Property from the appropriate Governmental Authority concerning
applicable zoning and building laws, and (B) a zoning endorsement to the Title
Policy or (2) a zoning opinion letter, in each case in substance satisfactory to
Lender;
(k)    a Guaranty or Confirmation of Guaranty by each party providing a Guaranty
to Lender;
(l)    a Contribution Agreement or an amendment thereto;
(m)    an Environmental Indemnity Agreement, amendment thereto or Confirmation
of Environmental Indemnity Agreement, as required by Lender;
(n)    a Facility Operating Agreement or an amendment thereto applicable to the
Additional Mortgaged Property, as approved by Lender;
(o)    an assignment of leases and rents applicable to the Additional Mortgaged
Property, if Lender determines one to be necessary or desirable;
(p)    any required subordination, non-disturbance and attornment agreements
and/or estoppel certificates with respect to any commercial leases, master
leases and/or ground lease (if any) affecting the Additional Mortgaged Property;
and
(q)    such other documents, instruments and approvals (and if requested by
Lender, certified duplicates of executed copies thereof) as Lender may
reasonably request.
[Remainder of Page Intentionally Blank]

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INITIAL PAGE TO SCHEDULE 8 TO
MASTER CREDIT FACILITY AGREEMENT

Property-Related Documents Schedule

/s/ GTH    
Borrower Initials

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SCHEDULE 9 TO
MASTER CREDIT FACILITY AGREEMENT

Conversion Schedule

The procedure for converting all or any portion of a Variable Note to a Fixed
Note contained in this Conversion Schedule shall apply to all Conversion of
Variable Notes to Fixed Notes which are permitted during the Conversion
Availability Period.
(a)    Request.
Borrower shall deliver a Conversion Request to Lender. Each Conversion Request
shall designate the amount of the Variable Note Outstanding to be converted.
Each Conversion Request shall be in the minimum amount of $5,000,000 or such
other amount permitted by Lender.
(b)    Underwriting and Terms of Conversion.
(1)    Coverage and LTV Tests; Failure to Underwrite.
After giving effect to the requested Conversion, the Coverage and LTV Tests
shall be satisfied. In the event that the Coverage and LTV Tests would not be
satisfied after the proposed Conversion, if Borrower continues to elect the
Conversion, Borrower shall prepay such Advances or a portion of an Advance to
meet the Coverage and LTV Tests and shall pay all Prepayment Premiums and other
fees associated with such prepayment.
(2)    Maturity Date of Converted Advances.
Upon Conversion, such converted Note shall have a Maturity Date specified by
Borrower, provided that such Maturity Date shall be subject to Section
2.03(a)(5) (Maturity Dates.
(3)    Interest Rate for Converted Note; Guaranty and Servicing Fee.
The Interest Rate for such converted Note shall be determined by Lender at the
time of the Conversion. The guaranty and servicing fee applicable to such
converted Note shall be determined by Lender prior to such Conversion and shall
be based on first lien market pricing as customarily determined by Fannie Mae at
such time.
(c)    Conditions Precedent.
The Conversion of all or a portion of a Variable Note to a Fixed Note on the
applicable Effective Date shall be subject to satisfaction of the following
conditions precedent:
(1)    satisfaction of the tests set forth in (b) (Underwriting and Terms of
Conversion) of this Conversion Schedule;
(2)    receipt by Lender of:

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(A)    if required by Lender, an endorsement to each Title Policy, amending the
effective date of the Title Policy to the Effective Date and showing no
additional exceptions to coverage other than the exceptions shown on the
Effective Date when each Title Policy was issued, Permitted Encumbrances and
other exceptions approved by Lender;
(B)    clean UCC searches, judgment searches and tax lien searches on Guarantor,
Borrower and Affiliated Property Operator and other Identified Parties.
(C)    the Conversion Fee;
(D)    a Request Opinion; and
(E)    one (1) or more executed, original counterparts of all Conversion
Documents, dated as of the Effective Date, each of which shall be in full force
and effect and in form and substance satisfactory to Lender in all respects; and
(3)    satisfaction of all General Conditions.
(d)    Closing.
The Effective Date shall occur during the Conversion Availability Period and in
connection with a Variable Structured ARM Advance on a Rate Change Date. The
Effective Date of a Conversion shall not be earlier than thirty (30) Business
Days after Lender’s receipt of the Conversion Request (or on such other date as
Borrower and Lender may agree). At the closing, Lender and Borrower shall
execute and deliver, at the sole cost and expense of Borrower, in form and
substance satisfactory to Lender, the Conversion Documents.
[Remainder of Page Intentionally Blank]

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INITIAL PAGE TO SCHEDULE 9 TO
MASTER CREDIT FACILITY AGREEMENT

Conversion Schedule

/s/ GTH    
Borrower Initials

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SCHEDULE 10 TO
MASTER CREDIT FACILITY AGREEMENT
Mortgaged Property Release Schedule
Any Mortgaged Property released from the Collateral Pool pursuant to Section
2.10 (Collateral Events) of this Master Agreement shall be subject to the terms
of this Master Agreement including this Mortgaged Property Release Schedule.
(a)    Request.
(1)    To obtain a Release of a Mortgaged Property from the Collateral Pool,
Borrower shall deliver a Release Request to Lender. Borrower shall not be
permitted to re-borrow any amounts that will be prepaid in connection with the
Release and any prepayments associated with such release shall automatically
result in a permanent reduction of the Advances Outstanding.
(2)    In connection with a Substitution, Borrower shall simultaneously deliver
to Lender both a completed and executed Release Request and Addition Request
pursuant to the Mortgaged Property Addition Schedule (unless the substitute
Additional Mortgaged Property has not been identified by Borrower, in which case
Borrower shall submit the Addition Request not less than sixty (60) Calendar
Days prior to the date on which Borrower desires to add such Additional
Mortgaged Property, but not later than sixty (60) Calendar Days prior to the
Property Delivery Deadline). The Release Request shall indicate whether Borrower
is requesting a simultaneous Substitution or a Staggered Substitution (as
described in Section (e)(2)(B) (Closing) of the Mortgaged Property Addition
Schedule).
(b)    Underwriting.
(1)    Lender shall release a Released Mortgaged Property pursuant to a Release
Request if all of the following conditions are satisfied:
(A)    the resulting Collateral Pool satisfies the Coverage and LTV Tests; and
(B)    the Aggregate Debt Service Coverage Ratio will not be reduced and the
Aggregate Loan to Value Ratio will not be increased as a result of such Release.
(2)    Borrower agrees that the Mortgaged Properties identified in each lettered
clause below can only be Released simultaneously and cannot be Released one
independent of the other:
(A)    Brookdale Leesburg AL    700 South Lake
Street    Leesburg                Brookdale Leesburg MC    710 South Lake
Street    Leesburg    

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(B)    Brookdale Ithaca AL        103 Bundy
Road                        Brookdale Ithaca MC        101 Bundy Road    
(C)    Brookdale Niagara AL    6741 Nash Road                        Brookdale
Niagara MC    6751 Nash Road    
(c)    Release Price.
(1)    The “Release Price” for each Release Mortgaged Property means the greater
of
(A)    one hundred percent (100%) of the Allocable Facility Amount for the
Release Mortgaged Property; and
(B)    one hundred percent (100%) of the amount, if any, of Advances Outstanding
that are required to be repaid by Borrower to Lender in connection with the
proposed Release of the Release Mortgaged Property from the Collateral Pool so
that, immediately after the Release, the provisions of Section (b)
(Underwriting) of this Mortgaged Property Release Schedule shall be satisfied.
(2)    In addition to the Release Price, Borrower shall pay to Lender all
associated Prepayment Premiums and other amounts due under the Notes evidencing
the Advances being repaid. In connection with a Staggered Substitution, Borrower
shall post a Substitution Deposit (which shall include the Release Price)
pursuant to the terms of this Mortgaged Property Release Schedule.
(d)    Application of Release Price.
(1)    The Release Price for the Release Mortgaged Property shall be applied in
reduction of the principal amounts of the Advances Outstanding in the order
selected by Borrower, provided that (A) any amount of the Note that Borrower
elects to prepay must be prepaid in full or, if the Release Price is not
sufficient to do so, the Note shall be the only Note partially prepaid; (B)
prepayment is permitted under such Note; (C) any Prepayment Premium due and
owing is paid; and (D) interest is paid through the end of the month. If
Borrower does not give Lender direction with respect to the application of the
Release Price or if the selected Note does not comply with the provisions of (A)
and (B) above, then the Release Price shall be applied:
(i)    first against any Variable Advances Outstanding so long as the prepayment
is permitted under the Variable Note (and any Prepayment Premium due and owing
is paid), until any Variable Advance is no longer Outstanding (provided that, in
the event there are multiple Variable Advances Outstanding, Lender shall
determine the order of application of the Release Price taking into account
factors including the unpaid principal balances of

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the Variable Notes, and which Variable Note Outstanding has the lowest
prepayment costs or highest interest rate);
(ii)    then against any Fixed Advances Outstanding, so long as prepayment is
permitted under the applicable Fixed Note (and any Prepayment Premium due and
owing is paid) (provided that, in the event there are multiple Fixed Advances
Outstanding, Lender shall determine the order of application of the Release
Price taking into account factors including the unpaid principal balances of the
Fixed Notes, and which Fixed Note Outstanding has the lowest prepayment costs or
the highest interest rate).
The Note to be prepaid or partially prepaid as determined pursuant to this
Section (d) (Application of Release Price), shall be referred to as the
“Selected Advance”.
(2)    In connection with a Substitution, Borrower may substitute a Mortgaged
Property that has an estimated Allocable Facility Amount that is less than the
Allocable Facility Amount of the Release Mortgaged Property so long as Borrower
pays the Release Price associated with the difference between such Allocable
Facility Amounts.
(e)    Conditions Precedent.
The Release of a Mortgaged Property from the Collateral Pool is subject to the
satisfaction of the following conditions precedent on or before the Effective
Date:
(1)    the Selected Advance must be prepayable as of the Effective Date of the
Release of such Mortgaged Property;
(2)    receipt by Lender of the fully executed Release Request;
(3)    immediately after giving effect to the requested Release, the provisions
of Section (b) (Underwriting) of this Mortgaged Property Release Schedule are
satisfied;
(4)    receipt by Lender of the Release Price and all amounts owing under
Section (c) (Release Price) of this Mortgaged Property Release Schedule, or, in
connection with a Staggered Substitution, receipt by Lender of the Substitution
Deposit (inclusive of the Substitution Cost Deposit) to the extent necessary
under Section (g)(1) (The Substitution Deposit) of this Mortgaged Property
Release Schedule;
(5)    receipt by Lender of the Release Fee, or in connection with a
Substitution, receipt by Lender of the Substitution Fee;
(6)    receipt by Lender of all legal fees and expenses in connection with a
Release Request;
(7)    receipt by Lender of one (1) or more executed, original counterparts of
all Release Documents, dated as of the Effective Date, each of which shall be in
full force and effect, in form and substance satisfactory to Lender in all
respects;

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(8)    if required by Lender, amendments to this Master Agreement, the Notes and
the Security Instruments, reflecting the release of the Release Mortgaged
Property from the Collateral Pool and, as to any Security Instrument or Note so
amended or if Lender determines that such endorsement is necessary to maintain
the priority of the Lien created in favor of Lender with respect to the
Outstanding Indebtedness or to maintain the validity of any Title Policy, the
receipt by Lender of an endorsement to each Title Policy insuring the Security
Instruments, amending the effective date of each Title Policy to the Effective
Date and showing no additional exceptions to coverage other than the exceptions
shown on the initial Effective Date for such Mortgaged Property, Permitted
Encumbrances and other exceptions approved by Lender;
(9)    satisfaction of all applicable General Conditions;
(10)    if the Release Mortgaged Property is one phase of a project, and one or
more other phases of the project are Mortgaged Properties which will remain in
the Collateral Pool (“Remaining Mortgaged Properties”), the Remaining Mortgaged
Properties must be able to be operated separately from the Release Mortgaged
Property and any other phases of the project which are not Mortgaged Properties,
taking into account any cross use agreements or easements, access, utilities,
marketability, community services, ownership and operation of the Remaining
Mortgaged Properties and any other relevant factors pursuant to the Underwriting
and Servicing Requirements. Borrower shall deliver to Lender evidence
satisfactory to Lender that this condition precedent is satisfied prior to the
closing of the transaction that is the subject of the Request. Borrower
acknowledges that none of the Initial Mortgaged Properties are part of a phase
of a project;
(11)    after the Release no Borrower nor any general partner of Borrower owns
the Release Mortgaged Property or any portion thereof;
(12)    receipt by Lender of endorsements to the tie-in endorsements of the
Title Policies, if deemed necessary by Lender, to reflect the Release.
Notwithstanding anything to the contrary herein, no Release of any Mortgaged
Property in the Collateral Pool shall be made unless Borrower has provided title
insurance to Lender in respect of each of the remaining Mortgaged Properties in
the Collateral Pool in an amount equal to one hundred percent (100%) of the
Outstanding Advances (which amount shall take into account the title insurance
coverage provided by any “tie-in” endorsements); and
(13)    receipt by Lender on the Effective Date of a Confirmation of Obligations
and a Confirmation of Guaranty.
(f)    Closing.
If all conditions precedent contained in this Master Agreement are satisfied,
Lender shall cause the Release Mortgaged Property to be Released on an Effective
Date selected by Lender, and occurring within thirty (30) days after Lender’s
receipt of the Release Request (or on such other date as Borrower and Lender may
agree), by executing and delivering, and causing all applicable parties to
execute and deliver, all at the sole cost and expense of Borrower, the Release
Documents.

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If approved by Lender, Borrower may prepare the Release Documents and submit
them to Lender for its review.
(g)    Staggered Substitution Specific Terms.
The following provisions are applicable to Staggered Substitutions only:
(1)    The Substitution Deposit.
If a Substitution is a Staggered Substitution, on or before the Effective Date
of the Release of the Release Mortgaged Property, Borrower shall deposit with
Lender the “Substitution Deposit” described below in the form of cash in a
non-interest bearing account held by Lender as additional Collateral. In lieu of
(or in addition to) depositing cash for the Substitution Deposit, Borrower may
post a Letter of Credit as additional Collateral issued by a financial
institution reasonably acceptable to Lender in accordance with the Letter of
Credit Schedule, with a face amount available to be drawn equal to the
Substitution Deposit (less any amount deposited in cash) as additional
Collateral.
(2)    Substitution Deposit Amount.
(A)    The “Substitution Deposit” for each proposed Staggered Substitution shall
be an amount equal to the sum of:
(i)    the Release Price relating to the Release Mortgaged Property; plus
(ii)    any and all Prepayment Premiums, as applicable, for the Selected Advance
determined in accordance with the conditions set forth in Section (d)
(Application of Release Price) of this Mortgaged Property Release Schedule, as
the Advance(s) that shall be prepaid if the Substitution fails to take place.
The Prepayment Premium shall be calculated as of the end of the month in which
the Property Delivery Deadline occurs, as if the Selected Advance were to be
prepaid in such month; plus (iii) estimated costs, expenses and fees of Lender
and Fannie Mae pertaining to the Substitution (such costs, fees and expenses,
the “Substitution Cost Deposit”);
(iv)    without duplication to any other amounts included in the definition of
Substitution Deposit, in the event that (1) at the time of the Release no Note
is prepayable (i.e. all Notes are subject to a lockout period) or (2) the
Release Price is in excess of all Notes that are open to prepayment, all
scheduled principal and interest due and owing through the end of the lockout
period with respect to such Selected Advance.
The amount of the required Substitution Deposit shall be recalculated by Lender
in the event the Property Delivery Deadline is extended pursuant to Section (e)
(Closing) of the Mortgaged Property Addition Schedule, and in the event a
Substitution is partially satisfied by the Addition of an Additional Mortgaged
Property, as further set forth in Section (f)(2))

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(Substitution Deposit Disbursement and Recalculation) of the Mortgaged Property
Addition Schedule.
(B)    The Substitution Cost Deposit shall be used by Lender to cover all
reasonable out-of-pocket costs and expenses incurred by Lender and Fannie Mae,
including any out-of-pocket legal fees and expenses incurred by Fannie Mae and
Lender in connection with such Substitution whether such Substitution actually
closes (the “Substitution Costs”).
(3)    Continued Obligations; Restriction on Borrowings.
(A)    Borrower shall continue to be obligated to make any regularly scheduled
payments of principal and interest due under all Notes Outstanding during the
Staggered Substitution period. Until the completion of the Staggered
Substitution, no Future Advances will be permitted unless and until the
provisions of Section (f)(1) (Failure to Close Substitution) of the Mortgaged
Property Addition Schedule are satisfied.
(B)    In connection with a Staggered Substitution, until the Addition of the
Additional Mortgaged Property to the Collateral Pool and closing of the
Substitution occurs, no Future Advances or other Requests will be permitted,
provided that a Termination Request shall be permitted subject to satisfaction
of the conditions in Section 2.11 (Termination of Master Agreement), and a
Conversion pursuant to a Conversion Request shall be permitted subject to
satisfaction of the conditions in the Conversion Schedule; provided further,
however, with respect to any Conversion, the Substitution Deposit shall be
recalculated based on the provisions in Section (g) (Staggered Substitution
Specific Terms) of this Mortgaged Property Release Schedule and Borrower shall
deposit with Lender as additional Collateral all increases, if any, in such
Substitution Deposit within five (5) days after receipt of notice of the same).
(C)    Notwithstanding anything to the contrary in this Master Agreement, no
Staggered Substitution shall be permitted unless immediately after the Release
of the Release Mortgaged Property the requirements in Section 2.10(e)
(Limitation on Collateral Events) are satisfied.
(h)    Release of Borrower, Guarantor, and Property Operator.
Upon the Release of a Mortgaged Property, Borrower that is the owner of such
Release Mortgaged Property (assuming Borrower owns no other Mortgaged Property
in the Collateral Pool), Guarantor, and Property Operator shall be released
automatically of all obligations solely related to the Release Mortgaged
Property as set forth in this Master Agreement and the other Loan Documents,
except for any provisions of this Master Agreement and the other Loan Documents
that are expressly stated to survive any release or termination or for any
liabilities or obligations of such Borrower, Guarantor, or Property Operator
which arose prior to the Effective Date of such Release.

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[Remainder of Page Intentionally Blank]

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INITIAL PAGE TO SCHEDULE 10 TO
MASTER CREDIT FACILITY AGREEMENT

Mortgaged Property Release Schedule

/s/ GTH    
Borrower Initials

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SCHEDULE 11 TO
MASTER CREDIT FACILITY AGREEMENT

Mortgaged Property Addition Schedule

Any Mortgaged Property (including a Mortgaged Property added in connection with
a Substitution) added to the Collateral Pool pursuant to Section 2.10
(Collateral Events) of this Master Agreement shall be subject to the terms of
this Master Agreement including this Mortgaged Property Addition Schedule.
(a)    Request.
(1)    From time to time, Borrower may deliver to Lender an Addition Request to
add one (1) or more Additional Mortgaged Properties to the Collateral Pool.
(2)    Any Addition Request shall be accompanied by the Additional Due Diligence
Fees and Additional Due Diligence Fee Deposits. Borrower shall provide Lender
information similar to the property-related information required by Lender in
connection with the Initial Advances made hereunder and any additional
information Lender may reasonably request.
(b)    Underwriting.
(1)    The following tests shall be satisfied as of the Effective Date:
(A)    the proposed Additional Mortgaged Property satisfies the Individual
Property Coverage and LTV Tests for the applicable acuity type of the Mortgaged
Property.
(B)    immediately after such Addition, the Collateral Pool satisfies the
Coverage and LTV Tests;
(C)    in connection with a Substitution, the Aggregate Debt Service Coverage
Ratio of the Collateral Pool will not be less than the Aggregate Debt Service
Coverage Ratio of the Collateral Pool immediately prior to the Release (taking
into account any paydown Borrower may make in order to comply with such ratio,
subject to the terms of this Master Agreement);
(D)    in connection with a Substitution, the Aggregate Loan to Value Ratio of
the Collateral Pool will not be greater than the Aggregate Loan to Value Ratio
of the Collateral Pool immediately prior to the Release (taking into account any
paydown Borrower may make in order to comply with such ratio, subject to the
terms of this Master Agreement); and
(E)    compliance with Schedule 19 (Seniors Housing – Skilled Nursing), if
applicable.

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Notwithstanding anything to the contrary in this Master Agreement, no Collateral
Event shall be permitted unless immediately after such Collateral Event the
provisions of Section 2.10(e) (Limitation on Collateral Events) shall be
satisfied.
(2)    Lender shall evaluate the proposed Additional Mortgaged Property in
accordance with the Underwriting and Servicing Requirements. Lender shall
determine the Loan to Value Ratio of the proposed Additional Mortgaged Property
and the Aggregate Loan to Value Ratio applicable to the Collateral Pool on the
basis of the lesser of:
(A)    the acquisition price of the proposed Additional Mortgaged Property, if
purchased by Borrower within twelve (12) months of the related Addition Request,
and
(B)    a Valuation made with respect to the proposed Additional Mortgaged
Property.
(3)    After receipt of the Addition Request and all reports, certificates and
documents required by Lender to determine compliance with this Mortgaged
Property Addition Schedule, Lender shall notify Borrower whether the proposed
Additional Mortgaged Property meets the requirements for Additions set forth in
this Mortgaged Property Addition Schedule.
(4)    If the proposed Additional Mortgaged Property meets the conditions set
forth in this Mortgaged Property Addition Schedule, Lender shall notify Borrower
of the Aggregate Debt Service Coverage Ratio, the Aggregate Loan to Value Ratio,
and (in connection with any Future Advance made in connection with an Addition)
the Advance amount that shall result from the Addition.
(c)    Additional Borrower.
On the Effective Date of the Addition of an Additional Mortgaged Property, the
owner of such Additional Mortgaged Property, if such owner is an Additional
Borrower, shall become a party to the Contribution Agreement in a manner
satisfactory to Lender. Any Additional Borrower shall join into this Master
Agreement and other Loan Documents and shall execute and deliver to Lender an
amendment adding such Additional Borrower as a party to this Master Agreement
and revising the Schedules and Exhibits hereto, as applicable, to reflect the
Additional Mortgaged Property and Additional Borrower, in each case satisfactory
to Lender. Any Additional Borrower and its general partner must comply with the
provisions of this Master Agreement, including the Single Purpose requirements
of Section 4.01(h) (Borrower Status – Representations and Warranties – Single
Purpose Status) unless otherwise waived by Lender.
(d)    Conditions Precedent.
The Addition of an Additional Mortgaged Property to the Collateral Pool on the
applicable Effective Date is subject to the satisfaction of the following
conditions precedent:

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(1)    satisfaction of the provisions of Section (b) (Underwriting) of this
Mortgaged Property Addition Schedule;
(2)    receipt by Lender of the Additional Due Diligence Fee and the Additional
Due Diligence Fee Deposit;
(3)    satisfaction of all General Conditions;
(4)    receipt by Lender of all Property-Related Documents;
(5)    receipt by Lender of a Request Opinion; and
(6)    receipt by Lender of a licensing opinion in form and substance
satisfactory to Lender in all respects.
(e)    Closing.
(1)    Additions.
Other than in connection with a Substitution, if the proposed Additional
Mortgaged Property meets the conditions set forth in this Mortgaged Property
Addition Schedule, and Borrower timely elects to add the proposed Additional
Mortgaged Property to a Collateral Pool, the proposed Additional Mortgaged
Property shall be added to the Collateral Pool on an Effective Date selected by
Lender, occurring within thirty (30) Business Days after all of the conditions
for an Addition have been satisfied (or on such other date as Borrower and
Lender may agree).
(2)    Substitutions.
In connection with a Substitution, if the Additional Mortgaged Property
satisfies the conditions set forth herein and Borrower timely elects to proceed
with the Substitution, the proposed Additional Mortgaged Property shall be added
in replacement of the Mortgaged Property being released on an Effective Date
selected by Lender and occurring:
(A)    if the Substitution of the proposed Additional Mortgaged Property is to
occur simultaneously with the release of the Release Mortgaged Property, within
sixty (60) days after Lender’s receipt of Borrower’s Release Request indicating
there is to be a Substitution (or on such other date to which Borrower and
Lender may agree); or
(B)    if the Substitution is a Staggered Substitution, within ninety (90) days
after the release of such Release Mortgaged Property (provided such date shall
be extended an additional ninety (90) days if Borrower provides reasonable
evidence of Borrower’s diligent efforts in finding a suitable proposed
Additional Mortgaged Property) (the “Property Delivery Deadline”) in accordance
with the terms of the Mortgaged Property Release Schedule and this Mortgaged
Property Addition Schedule.

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(f)    Staggered Substitutions.
(1)    Failure to Close Substitution.
If the Substitution of the proposed Additional Mortgaged Property does not occur
by the Property Delivery Deadline, then such Borrower shall have irrevocably
waived its right to substitute such Release Mortgaged Property with the proposed
Additional Mortgaged Property, and the release of the Release Mortgaged Property
shall be deemed to be a Release pursuant to the terms of the Mortgaged Property
Release Schedule and shall trigger payment pursuant to the terms of the
Mortgaged Property Release Schedule, plus the Release Fee.
(2)    Substitution Deposit Disbursement and Recalculation.
(A)    On or prior to the Effective Date of the Substitution, Lender shall
notify Borrower of the actual amount of the Substitution Costs incurred by
Lender and Fannie Mae in connection with the Substitution and Borrower shall, on
or before the Effective Date of the Substitution, pay to Lender the remainder of
such Substitution Costs (if the actual amount of the Substitution Costs exceed
the Substitution Cost Deposit (as defined in Section (g) (Staggered Substitution
Specific Terms) of the Mortgaged Property Release Schedule) and the other
amounts previously deposited with Lender by Borrower) or Lender shall promptly
refund to Borrower any Substitution Cost Deposit deposited with Lender by
Borrower in excess of the Substitution Costs (if the actual amount of the
Substitution Costs is less than the Substitution Cost Deposit deposited with
Lender by Borrower).
(B)    At closing of the Substitution, Lender shall disburse or return the
Substitution Deposit (as defined in Section (g) (Staggered Substitution Specific
Terms) of the Mortgaged Property Release Schedule), as applicable (less any
portion of the Substitution Cost Deposit used by Lender to cover all reasonable
out-of-pocket costs and expenses incurred by Lender and Fannie Mae, including
any out-of-pocket legal fees and expenses incurred by Fannie Mae and Lender in
connection with such Substitution), directly to Borrower at such time as the
conditions precedent for the Substitution have been satisfied, which must occur
no later than the Property Delivery Deadline.
(C)    If, pursuant to Section (b) (Underwriting) of this Mortgaged Property
Addition Schedule, Borrower substitutes a Mortgaged Property that has an
estimated Allocable Facility Amount that is less than the Allocable Facility
Amount of the Release Mortgaged Property and Borrower notifies Lender that no
further property will be substituted or Borrower fails to timely identify an
additional replacement Mortgaged Property, then Lender shall disburse to
Borrower that portion of the Substitution Deposit (less any portion of the
Substitution Cost Deposit used by Lender to cover all reasonable out-of-pocket
costs and expenses incurred by Lender and Fannie Mae, including any
out-of-pocket legal fees and expenses incurred by Fannie Mae and Lender in
connection with such Substitution) equal to the Allocable Facility Amount of
such substitute Mortgaged Property and apply the remainder of

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the Substitution Deposit pursuant to Section (d) (Application of Release Price)
of the Mortgaged Property Release Schedule.
(D)    Notwithstanding the foregoing, in the event that (i) the Property
Delivery Deadline is extended pursuant to Section (e)(2)(B) (Closing) of this
Mortgaged Property Addition Schedule or (ii) Borrower adds an Additional
Mortgaged Property to the Collateral Pool prior to the Property Delivery
Deadline but the addition of such Additional Mortgaged Property has not in and
of itself satisfied the requirements of this Mortgaged Property Addition
Schedule, Lender shall recalculate the Substitution Deposit. Any reduction, if
any, in the Substitution Deposit shall be returned to Borrower, or in the case
of a Letter of Credit, such Letter of Credit shall be reduced by such reduction
in the Substitution Deposit. Any increase, if any, in the Substitution Deposit
shall be paid by Borrower to Lender within three (3) Business Days of notice
from Lender.
[Remainder of Page Intentionally Blank]

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INITIAL PAGE TO SCHEDULE 11 TO
MASTER CREDIT FACILITY AGREEMENT

Mortgaged Property Addition Schedule

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Borrower Initials

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SCHEDULE 12 TO
MASTER CREDIT FACILITY AGREEMENT

Reserved

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INITIAL PAGE TO SCHEDULE 12 TO
MASTER CREDIT FACILITY AGREEMENT

Reserved

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Borrower Initials

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SCHEDULE 13 TO
MASTER CREDIT FACILITY AGREEMENT

[omitted for SEC filing purposes]

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SCHEDULE 14 TO
MASTER CREDIT FACILITY AGREEMENT

Future Advance Schedule

Any Future Advance made under this Master Agreement shall be subject to the
terms of this Master Agreement including this Future Advance Schedule.
(a)    Request.
Borrower shall deliver a Future Advance Request to Lender. Any Future Advance
Request for a Future Advance shall be in the minimum amount of $5,000,000 or
such other amount permitted by Lender.
(b)    Underwriting.
Any Future Advance shall be subject to satisfaction of the following tests:
(1)    the Future Advance is being made in connection with a Future Advance
pursuant to Section 2.02(c)(2)(B) (Making Advances) without the Addition of an
Additional Mortgaged Property, the Coverage and LTV Tests would be satisfied and
all of the Underwriting and Servicing Requirements shall be satisfied; or
(2)    if the Future Advance is being made in connection with the Addition of an
Additional Mortgaged Property, the conditions of Section (b) (Underwriting) of
the Mortgaged Property Addition Schedule would be satisfied.
(c)    Interest Rate for Future Advance Note; Guaranty and Servicing Fee.
The Interest Rate for any Note in connection with a Future Advance shall be
determined by Lender at the time of the Future Advance. The guaranty and
servicing fee applicable to such Note shall be determined by Lender prior to the
making of the Future Advance and shall be based on first lien market pricing as
customarily determined by Fannie Mae at such time.
(d)    Conditions Precedent.
The funding of any Future Advance on the applicable Effective Date is subject to
the satisfaction of the following conditions precedent:
(1)    satisfaction of the underwriting tests set forth in (b) (Underwriting)
above;
(2)    Lender’s determination that the proposed borrower, property operator, key
principal, and guarantor meet all of Lender’s eligibility, credit, management
and other standards customarily applied by Lender in connection with the
origination or purchase of similar mortgage finance structures on similar
Seniors Housing Facilities at the time of the Future Advance Request for the
Future Advance;

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(3)    if required by Lender, if the Future Advance is a Variable Advance,
receipt by Lender at least five (5) days prior to the applicable Effective Date
of the confirmation of an Interest Rate Cap commitment, in accordance with the
Cap Security Agreement, effective as of the Effective Date;
(4)    if required by Lender, if the Future Advance is a Variable Advance,
receipt by Lender, within fifteen (15) days after the applicable Effective Date,
of Interest Rate Cap Documents, in accordance with the Cap Security Agreement,
effective as of the Effective Date;
(5)    if the Future Advance is a Fixed Advance, delivery of one or more Fixed
Notes, duly executed by Borrower, in the amount and reflecting all of the terms
of the Fixed Advance;
(6)    if the Future Advance is a Variable Advance, delivery of one or more
Variable Notes, duly executed by Borrower, in the amount and reflecting all of
the terms of the Variable Advance;
(7)    receipt by Lender of the completed Schedule of Advance Terms and
Prepayment Premium Schedule, in each case applicable to the Future Advance,
together with an amendment to this Master Agreement in form and substance
acceptable to Lender incorporating such Schedules in their entirety to this
Master Agreement;
(8)    if the Future Advance is made in connection with the Addition of a
Mortgaged Property, satisfaction of the conditions set forth in the Mortgaged
Property Addition Schedule including payment receipt by Lender of all fees
required pursuant to the Mortgaged Property Addition Schedule;
(9)    receipt by Lender of the Additional Origination Fee in connection with an
Advance made in connection with an Addition of an Additional Mortgaged Property;
(10)    if the Future Advance is being made under Section 2.02(c)(2)(B) (Making
Advances) without the Addition of an Additional Mortgaged Property, receipt by
Lender of the non-refundable Re-Underwriting Fee;
(11)    receipt by Lender of any other costs and expenses including all legal
fees incurred by Lender and Fannie Mae;
(12)    satisfaction of all General Conditions;
(13)    receipt by Lender of a Request Opinion;
(14)    receipt by Lender of all applicable Property-Related Documents, if
applicable; and
(15)    receipt by Lender of (i) an amendment to any existing Security
Instrument securing Mortgaged Property located in Virginia executed and
delivered by the applicable

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Borrower increasing the amount secured by such Security Instrument by the amount
of the Future Advance, and (ii) an endorsement to each applicable Title Policy
insuring the amended Security Instrument(s), amending the effective date of such
Title Policy to the Effective Date and showing no additional exceptions to
coverage other than the exceptions shown on the initial Effective Date for such
Mortgaged Property located in Virginia, Permitted Encumbrances and other
exceptions approved by Lender, together with any reinsurance agreements required
by Lender.
(d)    Closing of Future Advance.
If the conditions set forth in Section 2.02 (Advances) for a Future Advance are
satisfied, Lender shall make the requested Future Advance on an Effective Date
selected by Lender (or on such other date as Borrower and Lender may agree).
[Remainder of Page Intentionally Blank]

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INITIAL PAGE TO SCHEDULE 14 TO
MASTER CREDIT FACILITY AGREEMENT

Future Advance Schedule

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Borrower Initials

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SCHEDULE 15 TO
MASTER CREDIT FACILITY AGREEMENT
Letter of Credit Schedule
Any Letter of Credit required or permitted pursuant to this Master Agreement
shall be subject to the terms of this Master Agreement and this Letter of Credit
Schedule. Any Letter of Credit must be issued by a financial institution
satisfactory to Fannie Mae (“Issuer”).
(a)    Issuer; Letter of Credit Requirements.
The Letter of Credit shall be in form and substance satisfactory to Lender and
Lender shall be entitled (pursuant to Section (b) (Draws Under Letter of Credit)
below) to draw under such Letter of Credit solely upon presentation of a sight
draft to the Issuer. Any Letter of Credit shall be for a term of at least three
hundred sixty-four (364) days (provided that in connection with a Substitution,
the term of any Letter of Credit shall be no earlier than the date ten (10)
Business Days after the Property Delivery Deadline).
(b)    Draws Under Letter of Credit.
Lender shall have the right to draw monies under the Letter of Credit:
(1)    upon the occurrence of an Event of Default;
(2)    if thirty (30) days prior to the expiration of the Letter of Credit,
either the Letter of Credit has not been extended for a term of at least three
hundred sixty-four (364) days (provided that in connection with a Substitution,
the term of any Letter of Credit shall be at least until the date ten (10)
Business Days after the Property Delivery Deadline) or Borrower has not replaced
the Letter of Credit with substitute cash collateral in the amount required by
Lender;
(3)    upon the downgrading of the ratings of the long-term or short-term debt
obligations of the Issuer below a level satisfactory to Fannie Mae, the failure
of Borrower within five (5) days after notice of such downgrading to deliver to
Lender either (A) an acceptable replacement Letter of Credit or (B) substitute
cash collateral in the amount required by Lender; or
(4)    upon the failure to close a Substitution pursuant to Section (f)(1)
(Failure to Close Substitution) of the Mortgaged Property Addition Schedule.
(c)    Deposit to Cash Collateral Agreement.
If Lender draws under the Letter of Credit pursuant to this Master Agreement or
Section (b) (Draws Under Letter of Credit) above for reasons other than an Event
of Default, Lender shall deposit such draw monies into a Cash Collateral Account
until the earliest of the following events occurs:

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(1)    Borrower presents an acceptable replacement Letter of Credit and Lender
agrees to accept such Letter of Credit (provided that any agreement by Lender to
accept a replacement Letter of Credit will be conditioned upon Borrower’s
payment of all administrative and legal costs incurred by Lender and Fannie Mae
in connection with the replacement of the Letter of Credit);
(2)    the applicable provisions of this Master Agreement pursuant to which the
Letter of Credit was provided are satisfied;
(3)    Borrower pays all amounts due and payable under the Loan Documents and
Lender releases the liens of all Security Instruments;
(4)    Lender consents to Borrower’s request to apply the funds to the principal
balance of a Note specified by Borrower and to any Prepayment Premium due in
connection with such application; or
(5)    an Event of Default occurs and Lender elects to apply the proceeds as
described below in Section (d) (Default Draws) of this Letter of Credit
Schedule.
(d)    Default Draws.
If Lender draws under the Letter of Credit pursuant to Section (b) (Draws Under
Letter of Credit) of this Letter of Credit Schedule as a result of an Event of
Default, Lender shall have the right to use monies drawn under the Letter of
Credit for any of the following purposes:
(1)    to pay any amounts required to be paid by Borrower under the Loan
Documents (including, without limitation, any amounts required to be paid to
Lender under this Master Agreement);
(2)    to prepay any Note (on Borrower’s behalf, or on its own behalf, if Lender
becomes the owner of any Mortgaged Property) in whole or in part, including any
Prepayment Premium;
(3)    to deposit monies into the Cash Collateral Account; or
(4)    to exercise any other remedies available to Lender pursuant to this
Master Agreement.
(e)    Legal Opinion.
Prior to or simultaneous with the delivery of any new Letter of Credit (but not
the extension of any existing Letter of Credit), Borrower shall cause the
Issuer’s counsel to deliver a legal opinion satisfactory in form and substance
to Lender.
[Remainder of Page Intentionally Blank]

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INITIAL PAGE TO SCHEDULE 15 TO
MASTER CREDIT FACILITY AGREEMENT

Letter of Credit Schedule

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Borrower Initials

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SCHEDULE 16 TO
MASTER CREDIT FACILITY AGREEMENT

[omitted for SEC filing purposes]

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SCHEDULE 17 TO
MASTER CREDIT FACILITY AGREEMENT

Waiver of Imposition Deposits

The foregoing Master Agreement is hereby modified as follows:
1.    Capitalized terms used and not specifically defined herein have the
meanings given to such terms in this Master Agreement.
2.    The Definitions Schedule is hereby amended by adding the following new
definitions in the appropriate alphabetical order:
“Insurance Impositions” means the premiums for maintaining all Required
Insurance Coverage.
“Required Insurance Coverage” means the insurance coverage required pursuant to
Article 9 (Insurance) of this Master Agreement and under any other Loan
Document.
3.    Section 12.02 (Imposition Deposits, Taxes, and Other Charges – Covenants)
of this Master Agreement is hereby amended by adding the following provisions to
the end thereof:
(b)    Conditional Waiver of Collection of Imposition Deposits.
(1)    [reserved]
(2)    Notwithstanding anything contained in this Section 12.02 (Imposition
Deposits, Taxes, and Other Charges – Covenants) to the contrary, Lender hereby
agrees to waive the collection of Imposition Deposits for Insurance Impositions,
provided that:
(A)    Borrower shall pay such Insurance Impositions directly to the carrier or
agent ten (10) days prior to expiration or as necessary to prevent the Required
Insurance Coverage from lapsing due to non-payment of premiums;
(B)    Borrower shall provide Lender with proof of payment acceptable to Lender
of all Insurance Impositions within five (5) days after the date such Insurance
Impositions are paid; and
(C)    Borrower shall cause its insurance agent to provide Lender with such
certifications regarding the Required Insurance Coverage as Lender may request
from time to time evidencing that

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the Insurance Impositions have been paid in a timely manner and that all of the
Required Insurance Coverage is in full force and effect.
(3)    Lender reserves the right to require Borrower to deposit the Imposition
Deposits with Lender on each Payment Date for Insurance Impositions in
accordance with this Section 12.02 (Imposition Deposits, Taxes, and Other
Charges – Covenants) upon:
(A)    Borrower’s failure to pay Insurance Impositions or to provide Lender with
proof of payment of Insurance Impositions as required in this Section 12.02(b)
(Conditional Waiver of Collection of Imposition Deposits);
(B)    Borrower’s failure to maintain insurance coverage in accordance with the
requirements of Article 9 (Insurance);
(C)    the occurrence of any Transfer which is not permitted by the Loan
Documents, or any Transfer which requires Lender’s consent; or
(D)    the occurrence of an Event of Default under any of the other terms,
conditions and covenants set forth in this Master Agreement or any of the other
Loan Documents.
(4)    Except as specifically provided in this Section 12.02(b)(Conditional
Waiver of Collection of Imposition Deposits), the provisions of Article 9
(Insurance) shall remain in full force and effect.
[Remainder of Page Intentionally Blank]

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INITIAL PAGE TO SCHEDULE 17 TO
MASTER CREDIT FACILITY AGREEMENT

Waiver of Imposition Deposits

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Borrower Initials

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SCHEDULE 18 TO
MASTER CREDIT FACILITY AGREEMENT

[RESERVED]

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INITIAL PAGE TO SCHEDULE 18 TO
MASTER CREDIT FACILITY AGREEMENT

Reserved

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Borrower Initials

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SCHEDULE 19 TO
MASTER CREDIT FACILITY AGREEMENT

(Seniors Housing – Skilled Nursing)

On the Initial Effective Date, the Mortgaged Properties known as Brookdale
Carriage Club Providence and Brookdale Westlake Village have skilled nursing
units. With respect to such Mortgaged Properties, and as of the date any
Additional Mortgaged Property that has skilled nursing units is added to the
Collateral Pool, with respect to such initial Mortgaged Properties and
Additional Mortgaged Property, the foregoing Master Agreement is hereby modified
as follows:
1.
Capitalized terms used and not specifically defined herein have the meanings
given to such terms in the Master Agreement.

2.    The Definitions Schedule is hereby amended by adding the following new
definitions in the appropriate alphabetical order:
“Quarterly Testing” means Lender’s performance of a Skilled Nursing Compliance
Calculation on a quarterly basis for the prior consecutive six (6) month period.
“Skilled Nursing Compliance Calculation” means Lender’s periodic calculation of
the Skilled Nursing Net Operating Income Percentage to determine Borrower’s
compliance with the Skilled Nursing Covenant.
“Skilled Nursing Covenant” means Borrower’s covenant and agreement that the
Skilled Nursing Net Operating Income Percentage shall not exceed twenty
percent (20%) with respect to any Mortgaged Property.
“Skilled Nursing Net Operating Income” means, for any specified period, net
income derived from the skilled nursing units of the applicable Mortgaged
Property available for repayment of debt as adjusted in accordance with the
Underwriting and Servicing Requirements applicable to skilled nursing units.
“Skilled Nursing Net Operating Income Percentage” means the ratio of Skilled
Nursing Net Operating Income to the total Net Operating Income for the
applicable Mortgaged Property, expressed as a percentage.
3.    Section 6.01 (Property Use, Preservation and Maintenance – Representations
and Warranties) is hereby amended to add the following new provision to the end
thereof:
(h)    Representations Regarding Skilled Nursing.
As of the Effective Date, Borrower hereby confirms that the Skilled Nursing Net
Operating Income Percentage, the number of skilled nursing units, the number of
Medicaid-eligible units, and the number of Medicare-eligible units are set forth
on the Summary of Master Terms.

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4.    Section 6.02(a) (Property Use, Preservation and Maintenance – Covenants –
Use of Property) of this Master Agreement is hereby amended by deleting Section
6.02(a)(8) in its entirety, and a new subsection is hereby added to the end of
Section 6.02(a)(1) as follows:
(C)    such change in use does not increase the number of skilled nursing units
or beds at the Mortgaged Property);
5.    Section 6.02 (Property Use, Preservation and Maintenance – Covenants) of
this Master Agreement is hereby amended to add the following provision to the
end thereof:
(m)    Skilled Nursing Covenant.
(1)    Borrower covenants and agrees to comply with the Skilled Nursing
Covenant.
(2)    Following Borrower’s delivery of the annual financial statements required
pursuant to Section 8.02 in form sufficient for Lender to determine the Net
Operating Income for the applicable Mortgaged Property and the Skilled Nursing
Net Operating Income for Borrower’s most recent fiscal year, Lender shall
perform a Skilled Nursing Compliance Calculation for the prior calendar year.
(3)    If the Skilled Nursing Compliance Calculation shows a resulting Skilled
Nursing Net Operating Income Percentage equal to or exceeding fifteen
percent (15%), Lender shall notify Borrower in writing. Lender shall thereafter
complete Quarterly Testing, based on the most recent financial statements and
reports delivered by Borrower pursuant to Section 8.02 in form sufficient for
Lender to determine the Net Operating Income for the applicable Mortgaged
Property and the Skilled Nursing Net Operating Income for Borrower’s most recent
Quarterly Testing period, beginning at the end of the second calendar quarter
until such time as the results of the Quarterly Testing show a Skilled Nursing
Net Operating Income Percentage less than fifteen percent (15%).
(4)    If any Skilled Nursing Compliance Calculation shows that Borrower is in
violation of the Skilled Nursing Covenant, Lender shall notify Borrower in
writing. If Borrower continues to be in violation of the Skilled Nursing
Covenant as of the end of the next Quarterly Testing, Lender shall notify
Borrower in writing and such continued violation shall be an Event of Default
subject to the terms of Section 14.01(c) of this Master Agreement.
(5)    If Borrower has actual knowledge of a violation of the Skilled Nursing
Covenant, Borrower shall promptly notify Lender.

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6.    Section 8.02(b)(6)(F) (Books and Records; Financial Reporting – Covenants
– Items to Furnish to Lender) of the Master Agreement is hereby deleted and
restated in its entirety to read as follows:
(F)    copies of all reports relating to the services and operations of the
Mortgaged Property, including, if applicable, Medicare and/or Medicaid cost
reports and records relating to account balances due to or from third party
payors; and
7.    Section 14.01(a) (Defaults/Remedies – Events of Default – Automatic Events
of Default) of the Master Agreement is hereby amended to delete Section
14.01(a)(18)(D) and replace it with “[intentionally deleted]”.
8.    Section 14.01(a) (Defaults/Remedies – Events of Default – Automatic Events
of Default) of this Master Agreement is hereby amended to add the following
provision to the end thereof:
(21)    ceases to provide other facilities and services normally associated with
skilled nursing units, including (A) three (3) meals per day either delivered to
the resident or in central dining services, (B) ancillary services such as
physical therapy or occupational therapy, (C) periodic housekeeping, (D) laundry
services, (E) sufficient medical staff to provide the required resident medical
care, (F) customary transportation services, and (G) social activities.
[Remainder of Page Intentionally Blank]

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INITIAL PAGE TO SCHEDULE 19 TO
MASTER CREDIT FACILITY AGREEMENT

(Seniors Housing – Skilled Nursing)

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Borrower Initials

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SCHEDULE 19-A TO
MASTER CREDIT FACILITY AGREEMENT
ADDENDA TO SCHEDULE 2 – SUMMARY OF MASTER TERMS

[omitted for SEC filing purposes]

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SCHEDULE 20 TO
MASTER CREDIT FACILITY AGREEMENT

Expansion Structure General Terms

Purpose:
To allow for the construction of additional units through expansions or
construction of new buildings, or the major renovation and/or repositioning of
existing units through conversion, at an operating Seniors Housing property to
include Independent Living, Assisted Living, Alzheimer’s or any combination
thereof (a “Material Project”), where a Material Project is defined as physical
improvements costing in excess of $20,000/unit for the units to be renovated or
in excess of $3 million in total project costs at the Seniors Housing property.
The cost of these improvements will be funded solely with additional equity
contributed by the Borrower.

Transaction
Eligibility:
Regardless of execution type, all transactions will be subject to Fannie Mae’s
pre-review and approval of Lender’s package prepared in connection with the
Material Project. Among other attributes, Fannie Mae will evaluate the operation
of the existing property and documented level of demand for the new units (e.g.,
waiting lists).

Maximum
Percentage
Of Converted
And/or New Units:
The Material Projects shall represent no more than 25% of the existing total
aggregate units in the Collateral Pool.

Maximum
Percentage
Costs of
Converted or
New Units:
Total aggregate cost of the Material Projects may not exceed 25% of the
Collateral Pool’s aggregate current value, as determined by Lender and Fannie
Mae. This determination may require a new Appraisal.

Borrower
Equity:         Expansion/renovation funds provided by the Borrower using all
equity.

Temporary
Minimum
Debt Service
Coverage:
Although the Collateral Pool will be required to demonstrate actual Aggregate
Debt Service Coverage Ratio at the minimum underwritten

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Aggregate Debt Service Coverage Ratio at origination, it is anticipated in
certain pre-approved circumstances that the Debt Service Coverage Ratio for the
Mortgaged Property on which a Material Project is located may decrease due to
tenancy disruption at the Mortgaged Property. However, as one of the conditions
to Lender and Fannie Mae’s approval of the Material Project, Borrower’s
pro-forma financial statements must demonstrate to Lender and Fannie Mae’s
satisfaction that at no time during the construction period will the reduction
in revenues caused by units taken off-line due to the Material Project result in
an Aggregate Debt Service Coverage Ratio lower than a 1.30x on Independent
Living Properties, 1.40x on Assisted Living Properties, and 1.45x on
Alzheimer’s/Memory Care Properties and SNF Properties, or Borrower may post a
letter of credit as additional collateral to support during the project if
necessary.

Completion of
Construction:
Completion of the Material Projects should occur no later than 18 months from
the date of commencement, subject to agreed upon extensions for force majeure.

Limit of a Number
of Construction
Activities (Conversions,
Expansions and
New Buildings):
Construction of Material Projects at no more than five (5) properties can occur
simultaneously each of which may be separate buildings.

Monitoring:
Fannie Mae’s standard construction monitoring processes and requirements will
apply, including but not limited to:

            
• Monthly: Third party inspection reports and title updates;
• Quarterly: Operating statements and rent rolls.

Construction
Monitoring
Fee:
Fannie Mae will charge a $10,000 Construction Monitoring Fee upfront for each
Material Project in connection with its monitoring requirements. If more than
one Material Project on a Mortgaged Property is requested at any one time, only
one Construction Monitoring Fee will be payable to Fannie Mae. This fee does not
cover the expense associated with third-party inspections. Lender will charge a
Construction Monitoring Fee based on market bids received prior to commencement
of monitoring. If more than one Material Project on a Mortgaged Property is
requested at any one time, only one Construction Monitoring Fee will be payable
to Lender. This fee does not cover the expense associated with third-party
inspections.

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Guaranty:
Full completion and performance guarantees for each Material Project will be
required from Guarantor. Guarantees will be released upon satisfactory
completion of the Material Project as determined by Fannie Mae and Lender.

Modification
Fee:
$12,500 payable to Fannie Mae for each Material Project located on a Mortgaged
Property. If more than one Material Project on a Mortgaged Property is requested
at any one time, only one Modification Fee will be payable to Fannie Mae, and
$12,500 payable to Lender for each Material Project located on a Mortgaged
Property. If more than one Material Project on a Mortgaged Property is requested
at any one time, only one Modification Fee will be payable to Lender.

Legal Fees:
All Fannie Mae legal fees to be reimbursed by Borrower.

Contract:
A fixed-price general contract for the Material Project provided by a general
contractor (the “Contractor”) acceptable in all respects to Lender and Fannie
Mae, along with a payment and performance bond (the “Bond”) that will be issued
by a surety acceptable in all respects to the Lender and Fannie Mae. Copies of
all required permits must be delivered to Lender and Fannie Mae prior to the
commencement of a Material Project.

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INITIAL PAGE TO SCHEDULE 20 TO
MASTER CREDIT FACILITY AGREEMENT

(Expansion Structure General Terms)

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Borrower Initials

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SCHEDULE 21 TO
MASTER CREDIT FACILITY AGREEMENT

[omitted for SEC filing purposes]

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SCHEDULE 22 TO
MASTER CREDIT FACILITY AGREEMENT

Licenses, Permits and Other Property Related Documents to be Delivered post
closing

1.
New Healthcare Licenses for Brookdale Northwest Hills

a.
Assisted Living Facility Type B Large License; and

b.
Facility for Alzheimer’s Disease and Related Disorders License.

2.
New Healthcare Licenses for Brookdale Lakeway

a.
Assisted Living Facility Type A Large License;

b.
Assisted Living Facility Type B Small License; and

c.
Facility for Alzheimer’s Disease and Related Disorders License

3.
New Healthcare License for Brookdale West Eisenhower Parkway – Home for the Aged
License

 

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INITIAL PAGE TO SCHEDULE 22 TO
MASTER CREDIT FACILITY AGREEMENT

Licenses, Permits and other Property Related Documents to be Delivered post
closing

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Borrower Initials

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SCHEDULE 23 TO
MASTER CREDIT FACILITY AGREEMENT
[omitted for SEC filing purposes]

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SCHEDULE 24 TO
MASTER CREDIT FACILITY AGREEMENT
[omitted for SEC filing purposes]

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SCHEDULE 25 TO
MASTER CREDIT FACILITY AGREEMENT
Ground Lease Defaults

The foregoing Master Agreement is hereby modified as follows:
1.Capitalized terms used and not specifically defined herein have the meanings
given to such terms in the Master Agreement.
2.Section 3.02(a) (Personal Liability of Borrower (Personal Liability Based on
Lender’s Loss (Partial Recourse)) of the Master Agreement is amended by adding
the following provision to the end thereof:
(21)    any failure by Borrower to comply with the provisions of Section 20(c)
(Ground Lease Provisions – Negative Covenants Regarding Ground Lease),
Section 20(d) (Ground Lease Provisions – Ground Lessee’s Bankruptcy Event),
Section 20(e)(1) (Ground Lease Provisions – Ground Lessor’s Bankruptcy Event) or
Section 20(g) (Ground Lease Provisions – Option to Renew or Extend Ground Lease)
of the Security Instrument for the Mortgaged Property known as Brookdale Santa
Monica.
3.Section 14.01(a) (Events of Default – Automatic Events of Default) of the
Master Agreement is amended by adding the following provision at the end
thereof:
(24)    any failure by Borrower to comply with the provisions of Section 20(b)
(Ground Lease Provisions – Affirmative Covenants Regarding Ground Lease) and
Section 20(c) (Ground Lease Provisions – Negative Covenants Regarding Ground
Lease) of the Security Instrument for the Mortgaged Property known as Brookdale
Santa Monica.

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MASTER CREDIT FACILITY AGREEMENT

Ground Lease Defaults

/s/ GTH    
Borrower Initials

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SCHEDULE 26 TO
MASTER CREDIT FACILITY AGREEMENT

(KANSAS -- NO ORAL AGREEMENTS)

1.This Certificate is attached to, and made an integral part of, the Master
Agreement, pursuant to K.S.A. Sections 16 117 and 16 118, as follows:
2.The Master Agreement and all other Loan Documents collectively constitute the
written credit agreement which is the final expression of the credit agreement
between Borrower and Lender.
3.The Master Agreement and all other Loan Documents may not be contradicted by
evidence of any prior oral credit agreement or of a contemporaneous oral credit
agreement between Borrower and Lender.
4.The following space (which Borrower and Lender agree is sufficient space) is
provided for the placement of nonstandard terms, if any:
__________________________________________________
[None]

5.Borrower and Lender affirm that there is no unwritten oral credit agreement
between Borrower and Lender with respect to the subject matter of the Master
Agreement and all other Loan Documents.

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INITIAL PAGE TO SCHEDULE 26 TO
MASTER CREDIT FACILITY AGREEMENT

(KANSAS -- NO ORAL AGREEMENTS)

Borrower’s Initials: /s/ GTH                Lender’s Initials: /s/ RP