**Exhibit10.3**

 

**GUARANTYAGREEMENT**

 

**THIS GUARANTY AGREEMENT**(this “Agreement”) is made and given as of October 25, 2002 by **FIVE STARQUALITY CARE, INC.**, a Maryland corporation****(the “Guarantor”),for the benefit of **SENIOR HOUSING PROPERTIES TRUST,**a Marylandreal estate investment trust (together with its successors and assigns, “SNH”),and **SNHCHS PROPERTIES TRUST,**a Maryland real estate investment trust(together with its successors and assigns, the “Landlord” and, togetherwith SNH, collectively, the “Beneficiaries”).

 

**WITNESSETH :**

 

**WHEREAS,** inconnection with the execution of a Purchase and Sale Agreement, dated as ofAugust 26, 2002, by and among Constellation Health Services, Inc. andcertain of its subsidiaries as further identified therein (collectively, the “Seller”),Constellation Real Estate Group, Inc. (“CREG”), and SNH, as amended bythat certain First Amendment to Purchase and Sale Agreement, dated as of thedate hereof, by and among the Seller, CREG, SNH and the Guarantor (as soamended, the “Purchase Agreement”), SNH and the Guarantor agreed, asbetween themselves, that the Guarantor would indemnify SNH for losses, claimsand expenses relating to certain assets being acquired by the Guarantorpursuant to the Purchase Agreement;

 

**WHEREAS**, pursuantto a Lease Agreement, dated as of the date hereof (the “Lease”), theLandlord has agreed to lease to FVE-CHS LLC, an indirect wholly ownedsubsidiary of the Guarantor (the “Tenant”), and the Tenant has agreed tolease from the Landlord, certain real property, together with certain relatedimprovements and personal property, as more particularly described in theLease; and

 

**WHEREAS**, it is acondition precedent to the Landlord’s entering into the Lease that theGuarantor guarantee all of the payment and performance obligations of theTenant with respect to the Lease; and

 

**WHEREAS**, thetransactions contemplated by the Lease are of direct material benefit to theGuarantor;

 

**NOW, THEREFORE**, inconsideration of the foregoing and for other good and valuable consideration,the mutual receipt and legal sufficiency of which are hereby acknowledged, theGuarantor hereby agrees as follows:

 

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1.                                       CertainTerms.  Capitalized terms used andnot otherwise defined in this Agreement shall have the meanings ascribed tosuch terms in the Lease.  The Lease andthe Incidental Documents are herein collectively referred to as the “TransactionDocuments.”

 

2.                                       GuaranteedObligations.  For purposes of thisAgreement:

 

(i)                                     theterm “SNH Guaranteed Obligations” shall mean the payment and performanceof the obligation of the Guarantor to indemnify, protect and hold harmless SNHfrom and against any and all liabilities, obligations, claims, damages,penalties, causes of action, costs and reasonable expenses (including, withoutlimitation, reasonable attorneys’ fees), to the maximum extent permitted bylaw, imposed upon or incurred by or asserted against SNH and related to thoseproperties described on Exhibit A attached hereto and made a part hereof(including, without limitation, any claim raised by any party under thePurchase Agreement with respect to such properties); and

 

(ii)                                  theterm “Landlord Guaranteed Obligations” shall mean (i) the payment andperformance of each and every obligation of the Tenant to the Landlord under theTransaction Documents or relating thereto, whether now existing or hereafterarising, and including, without limitation, the payment of the full amount ofthe Rent payable under the Lease and (ii) the repayment to the Landlord and itsAffiliated Persons of any and all amounts from time to time advanced orincurred by the Landlord or such Affiliated Persons in connection with anyguaranty or other agreement provided by the Landlord or such Affiliated Personsto any Governmental Agency to facilitate the licensing of any Facility locatedupon the Leased Property; and

 

(iii)                               theterm “Guaranteed Obligations” shall mean the SNH Guaranteed Obligationsand the Landlord Guaranteed Obligations, collectively.

 

3.                                       Representationsand Covenants.  The Guarantorrepresents, warrants, covenants, and agrees that:

 

3.1                                 Incorporationof Representations and Warranties. The representations and warranties of the Tenant and its AffiliatedPersons set forth in the Transaction Documents are true and correct on and asof the date hereof in all material respects.

 

3.2                                 Performanceof Covenants and Agreements.  TheGuarantor hereby agrees to take all lawful action in its power

 

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to cause the Tenant dulyand punctually to perform all of the covenants and agreements set forth in theTransaction Documents.

 

3.3                                 Validityof Agreement.  The Guarantor hasduly and validly executed and delivered this Agreement; this Agreementconstitutes the legal, valid and binding obligation of the Guarantor,enforceable against the Guarantor in accordance with its terms, except as theenforceability thereof may be subject to bankruptcy, fraudulent conveyance,insolvency, reorganization, moratorium and other laws relating to or affectingcreditors’ rights generally and subject to general equitable principles,regardless of whether enforceability is considered in a proceeding at law or inequity; and the execution, delivery and performance of this Agreement have beenduly authorized by all requisite action of the Guarantor and such execution,delivery and performance by the Guarantor will not result in any breach of theterms, conditions or provisions of, or conflict with or constitute a defaultunder, or result in the creation of any lien, charge or encumbrance upon any ofthe property or assets of the Guarantor pursuant to the terms of, anyindenture, mortgage, deed of trust, note, other evidence of indebtedness,agreement or other instrument to which it may be a party or by which it or anyof its property or assets may be bound, or violate any provision of law, or anyapplicable order, writ, injunction, judgment or decree of any court or anyorder or other public regulation of any governmental commission, bureau oradministrative agency.

 

3.4                                 Paymentof Expenses.  The Guarantor agrees,as principal obligor and not as guarantor only, to pay to the Beneficiariesforthwith, upon demand, in immediately available federal funds, all costs andexpenses (including reasonable attorneys’ fees and disbursements) incurred orexpended by the Beneficiaries in connection with the enforcement of thisAgreement, together with interest on amounts recoverable under this Agreementfrom the time such amounts become due until payment at the Overdue Rate.  The Guarantor’s covenants and agreements setforth in this Section 3.4 shall survive the termination of thisAgreement.

 

3.5                                 Notices.  The Guarantor shall promptly give notice tothe Beneficiaries of any event known to it which might reasonably result in amaterial adverse change in its financial condition.

 

3.6                                 Reports.  The Guarantor shall promptly provide to theLandlord each of the financial reports, certificates and other documentsrequired of it under the Transaction Documents.

 

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3.7                                 Booksand Records.  The Guarantor shall atall times keep proper books of record and account in which full, true andcorrect entries shall be made of its transactions in accordance with generallyaccepted accounting principles and shall set aside on its books from itsearnings for each fiscal year all such proper reserves, including reserves fordepreciation, depletion, obsolescence and amortization of its properties duringsuch fiscal year, as shall be required in accordance with generally acceptedaccounting principles, consistently applied, in connection with itsbusiness.  The Guarantor shall permitaccess by the Beneficiaries and their agents to the books and recordsmaintained by the Guarantor during normal business hours and upon reasonable notice.  Any proprietary information obtained byLandlord with respect to the Guarantor pursuant to the provisions of thisAgreement shall be treated as confidential, except that such information may bedisclosed or used, subject to appropriate confidentiality safeguards, pursuantto any court order or in any litigation between the parties and except furtherthat Landlord may disclose such information to its prospective lenders,provided that Landlord shall direct such lenders to maintain such information asconfidential.

 

3.8                                 Taxes,Etc.  The Guarantor shall pay anddischarge promptly as they become due and payable all taxes, assessments andother governmental charges or levies imposed upon the Guarantor or the incomeof the Guarantor or upon any of the property, real, personal or mixed, of theGuarantor, or upon any part thereof, as well as all claims of any kind(including claims for labor, materials and supplies) which, if unpaid, might bylaw become a lien or charge upon any property and result in a material adversechange in the financial condition of the Guarantor; provided, however,that the Guarantor shall not be required to pay any such tax, assessment,charge, levy or claim if the amount, applicability or validity thereof shallcurrently be contested in good faith by appropriate proceedings or otherappropriate actions promptly initiated and diligently conducted and if theGuarantor shall have set aside on its books such reserves of the Guarantor, ifany, with respect thereto as are required by generally accepted accountingprinciples.

 

3.9                                 LegalExistence of Guarantor. The Guarantor shall do or cause to be done allthings necessary to preserve and keep in full force and effect its legalexistence.

 

3.10                           Compliance.  The Guarantor shall use reasonable businessefforts to comply in all material respects with all applicable statutes, rules,regulations and orders of, and all applicable restrictions imposed by, allgovernmental authorities

 

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in respect of the conductof its business and the ownership of its property (including, withoutlimitation, applicable statutes, rules, regulations, orders and restrictionsrelating to environmental, safety and other similar standards or controls).

 

3.11                           Insurance.  The Guarantor shall maintain, withfinancially sound and reputable insurers, insurance with respect to itsproperties and business against loss or damage of the kinds customarily insuredagainst by owners of established reputation engaged in the same or similarbusinesses and similarly situated, in such amounts and by such methods as shallbe customary for such owners and deemed adequate by the Guarantor.

 

3.12                           NoChange in Control.  The Guarantorshall not permit the occurrence of any direct or indirect Change in Control ofthe Tenant or the Guarantor.

 

4.                                       Guarantee.  The Guarantor hereby unconditionallyguarantees that the Guaranteed Obligations which are monetary obligations shallbe paid in full when due and payable, whether upon demand, at the stated or acceleratedmaturity thereof pursuant to any Transaction Document, or otherwise, and thatthe Guaranteed Obligations which are performance obligations shall be fullyperformed at the times and in the manner such performance is required by theTransaction Documents.  With respect tothe Guaranteed Obligations which are monetary obligations, this guarantee is aguarantee of payment and not of collectibility and is absolute and in no wayconditional or contingent.  In case anypart of the Guaranteed Obligations shall not have been paid when due andpayable or performed at the time performance is required, the Guarantor shall,in the case of monetary obligations, within five (5) Business Days afterreceipt of notice from the applicable Beneficiary, pay or cause to be paid tosuch Beneficiary the amount thereof as is then due and payable and unpaid(including interest and other charges, if any, due thereon through the date ofpayment in accordance with the applicable provisions of the TransactionDocuments) or, in the case of nonmonetary obligations, perform or cause to beperformed such obligations in accordance with the Transaction Documents.

 

5.                                       Set-Off.  The Guarantor hereby authorizes theLandlord, at any time and without notice to set off the whole or any portion orportions of any or all sums credited by or due from the Landlord to it againstamounts payable under this Agreement. The Landlord shall promptly notify the Guarantor of

 

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any such set-off made bythe Landlord and the application made by the Landlord of the proceeds thereof.

 

6.                                       Unenforceabilityof Guaranteed Obligations, Etc.  Ifthe Tenant is for any reason under no legal obligation to discharge any of theGuaranteed Obligations (other than because the same have been previouslydischarged in accordance with the terms of the Transaction Documents), or ifany other moneys included in the Guaranteed Obligations have becomeunrecoverable from the Tenant by operation of law or for any other reason, including,without limitation, the invalidity or irregularity in whole or in part of anyGuaranteed Obligation or of any Transaction Document or any limitation on theliability of the Tenant thereunder not contemplated by the TransactionDocuments or any limitation on the method or terms of payment thereunder whichmay now or hereafter be caused or imposed in any manner whatsoever, theguarantees contained in this Agreement shall nevertheless remain in full forceand effect and shall be binding upon the Guarantor to the same extent as if theGuarantor at all times had been the principal debtor on all such GuaranteedObligations.

 

7.                                       AdditionalGuarantees.  This Agreement shall bein addition to any other guarantee or other security for the GuaranteedObligations and it shall not be prejudiced or rendered unenforceable by theinvalidity of any such other guarantee or security or by any waiver, amendment,release or modification thereof.

 

8.                                       Consentsand Waivers, Etc.  The Guarantorhereby acknowledges receipt of correct and complete copies of each of theTransaction Documents, and consents to all of the terms and provisions thereof,as the same may be from time to time hereafter amended or changed in accordancewith the terms and conditions thereof, and, except as otherwise providedherein, to the maximum extent permitted by applicable law, waives (a)presentment, demand for payment, and protest of nonpayment, of any principal ofor interest on any of the Guaranteed Obligations, (b) notice of acceptance ofthis Agreement and of diligence, presentment, demand and protest, (c) notice ofany default hereunder and any default, breach or nonperformance or Event ofDefault under any of the Guaranteed Obligations or the Transaction Documents,(d) notice of the terms, time and place of any private or public sale of anycollateral held as security for the Guaranteed Obligations, (e) demand forperformance or observance of, and any enforcement of any provision of, or anypursuit or exhaustion of rights or remedies against the Tenant or any otherguarantor of the Guaranteed Obligations, under or pursuant to the TransactionDocuments, or any agreement directly

 

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or indirectly relatingthereto and any requirements of diligence or promptness on the part of theholders of the Guaranteed Obligations in connection therewith, and (f) to theextent the Guarantor lawfully may do so, any and all demands and notices ofevery kind and description with respect to the foregoing or which may be requiredto be given by any statute or rule of law and any defense of any kind which itmay now or hereafter have with respect to this Agreement, or any of theTransaction Documents or the Guaranteed Obligations (other than that the samehave been discharged in accordance with the Transaction Documents).

 

9.                                       NoImpairment, Etc.  The obligations,covenants, agreements and duties of the Guarantor under this Agreement shallnot be affected or impaired by any assignment or transfer in whole or in partof any of the Guaranteed Obligations without notice to the Guarantor, or anywaiver by either Beneficiary or any holder of any of the Guaranteed Obligationsor by the holders of all of the Guaranteed Obligations of the performance orobservance by the Tenant or any other guarantor of any of the agreements,covenants, terms or conditions contained in the Guaranteed Obligations or theTransaction Documents or any indulgence in or the extension of the time forpayment by the Tenant or any other guarantor of any amounts payable under or inconnection with the Guaranteed Obligations or the Transaction Documents or anyother instrument or agreement relating to the Guaranteed Obligations or of thetime for performance by the Tenant or any other guarantor of any other obligationsunder or arising out of any of the foregoing or the extension or renewalthereof (except that with respect to any extension of time for payment orperformance of any of the Guaranteed Obligations granted by the Landlord or anyother holder of such Guaranteed Obligations to the Tenant, the Guarantor’sobligations to pay or perform such Guaranteed Obligation shall be subject tothe same extension of time for performance), or the modification or amendment(whether material or otherwise) of any duty, agreement or obligation of theTenant or any other guarantor set forth in any of the foregoing, or thevoluntary or involuntary sale or other disposition of all or substantially allthe assets of the Tenant or any other guarantor or insolvency, bankruptcy, or othersimilar proceedings affecting the Tenant or any other guarantor or any assetsof the Tenant or any such other guarantor, or the release or discharge of theTenant or any such other guarantor from the performance or observance of anyagreement, covenant, term or condition contained in any of the foregoingwithout the consent of the holders of the Guaranteed Obligations by operationof law, or any other cause, whether similar or dissimilar to the foregoing.

 

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10.                                 Reimbursement,Subrogation, Etc.  The Guarantorhereby covenants and agrees that it will not enforce or otherwise exercise anyrights of reimbursement, subrogation, contribution or other similar rightsagainst the Tenant (or any other person against whom the Landlord may proceed)with respect to the Guaranteed Obligations prior to the payment in full of allamounts owing with respect to the Lease, and until all indebtedness of theTenant to the Landlord shall have been paid in full, the Guarantor shall nothave any right of subrogation, and the Guarantor waives any defense it may havebased upon any election of remedies by the Landlord which destroys itssubrogation rights or its rights to proceed against the Tenant forreimbursement, including, without limitation, any loss of rights the Guarantormay suffer by reason of any rights, powers or remedies of the Tenant inconnection with any anti-deficiency laws or any other laws limiting, qualifyingor discharging the indebtedness to the Landlord.  Until all obligations of the Tenant pursuant to the TransactionDocuments shall have been paid and satisfied in full, the Guarantor furtherwaives any right to enforce any remedy which the Landlord now has or may in thefuture have against the Tenant, any other guarantor or any other person and anybenefit of, or any right to participate in, any security whatsoever now or inthe future held by the Landlord.

 

11.                                 Defeasance.  This Agreement shall terminate at such timeas the Guaranteed Obligations have been paid and performed in full and allother obligations of the Guarantor to the Beneficiaries under this Agreementhave been satisfied in full; provided, however, if at any time,all or any part of any payment applied on account of the Guaranteed Obligationsis or must be rescinded or returned for any reason whatsoever (including,without limitation, the insolvency, bankruptcy or reorganization of theTenant), this Agreement, to the extent such payment is or must be rescinded orreturned, shall be deemed to have continued in existence notwithstanding anysuch termination.

 

12.                                 Notices.  (a) Any and all notices, demands, consents, approvals, offers, elections andother communications required or permitted under this Agreement shall be deemedadequately given if in writing and the same shall be delivered either in hand,by telecopier with written acknowledgment of receipt, or by mail or FederalExpress or similar expedited commercial carrier, addressed to the recipient ofthe notice, postpaid and registered or certified with return receipt requested(if by mail), or with all freight charges prepaid (if by Federal Express orsimilar carrier).

 

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(b)                                 Allnotices required or permitted to be sent hereunder shall be deemed to have beengiven for all purposes of this Agreement upon the date of acknowledged receipt,in the case of a notice by telecopier, and, in all other cases, upon the dateof receipt or refusal, except that whenever under this Agreement a notice iseither received on a day which is not a Business Day or is required to bedelivered on or before a specific day which is not a Business Day, the day ofreceipt or required delivery shall automatically be extended to the nextBusiness Day.

 

(c)                                  Allsuch notices shall be addressed,

 

if to either Beneficiary:

 

Senior Housing PropertiesTrust

400 Centre Street

Newton, Massachusetts02458

Attn:  Mr. David J. Hegarty

[Telecopier No. (617)796-8349]

 

if to the Guarantor to:

 

Five Star Quality Care,Inc.

400 Centre Street

Newton, Massachusetts02458

Attn:  Mr. Evrett W. Benton

[Telecopier No. (617)796-8385]

 

(d)                                 Bynotice given as herein provided, the parties hereto and their respectivesuccessors and assigns shall have the right from time to time and at any timeduring the term of this Agreement to change their respective addresseseffective upon receipt by the other parties of such notice and each shall havethe right to specify as its address any other address within the United Statesof America.

 

13.                                 Successorsand Assigns.  Whenever in thisAgreement any of the parties hereto is referred to, such reference shall bedeemed to include the successors and assigns of such party, including withoutlimitation the holders, from time to time, of the Guaranteed Obligations; and allrepresentations, warranties, covenants and agreements by or on behalf of theGuarantor which are contained in this Agreement shall inure to the benefit ofthe Landlord’s successors and assigns, including without limitation saidholders, whether so expressed or not.

 

14.                                 ApplicableLaw.  Except as to matters regardingthe internal affairs of the Beneficiaries and issues of or limitations on anypersonal liability of the shareholders and

 

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trustees of theBeneficiaries for obligations of the Beneficiaries, as to which the laws of theState of Maryland shall govern, this Agreement, the Transaction Documents andany other instruments executed and delivered to evidence, complete or perfectthe transactions contemplated hereby and thereby shall be interpreted,construed, applied and enforced in accordance with the laws of The Commonwealthof Massachusetts applicable to contracts between residents of Massachusettswhich are to be performed entirely within Massachusetts, regardless of (i)where any such instrument is executed or delivered; or (ii) where any paymentor other performance required by any such instrument is made or required to bemade; or (iii) where any breach of any provision of any such instrument occurs,or any cause of action otherwise accrues; or (iv) where any action or otherproceeding is instituted or pending; or (v) the nationality, citizenship,domicile, principal place of business, or jurisdiction of organization ordomestication of any party; or (vi) whether the laws of the forum jurisdictionotherwise would apply the laws of a jurisdiction other than The Commonwealth ofMassachusetts; or (vii) any combination of the foregoing.

 

15.                                 Arbitration.  Either Beneficiary or the Guarantor may electto submit to arbitration any dispute hereunder that has an amount incontroversy in excess of $250,000.  Anysuch arbitration shall be conducted in Boston, Massachusetts in accordance withthe Commercial Arbitration Rules of the American Arbitration Association thenpertaining and the decision of the arbitrators with respect to such disputeshall be binding, final and conclusive on the parties.

 

In the event that anysuch dispute is submitted to arbitration hereunder, the applicable Beneficiaryand the Guarantor shall each appoint and pay all fees of a fit and impartialperson as arbitrator with at least ten (10) years’ recent professionalexperience in the general subject matter of the dispute.  Notice of such appointment shall be sent inwriting by each party to the other, and the arbitrators so appointed, in theevent of their failure to agree within thirty (30) days after the appointmentof the second arbitrator upon the matter so submitted, shall appoint a thirdarbitrator.  If either the Landlord or theGuarantor shall fail to appoint an arbitrator as aforesaid for a period oftwenty (20) days after written notice from the other party to make suchappointment, then the arbitrator appointed by the party having made suchappointment shall appoint a second arbitrator and the two (2) so appointedshall, in the event of their failure to agree upon any decision within thirty(30) days thereafter, appoint a third

 

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arbitrator.  If such arbitrators fail to agree upon athird arbitrator within forty five (45) days after the appointment of thesecond arbitrator, then such third arbitrator shall be appointed by theAmerican Arbitration Association from its qualified panel of arbitrators, andshall be a person having at least ten (10) years’ recent professionalexperience as to the subject matter in question.  The fees of the third arbitrator and the expenses incident to theproceedings shall be borne equally between the applicable Beneficiary and theGuarantor, unless the arbitrators decide otherwise.  The fees of respective counsel engaged by the parties, and thefees of expert witnesses and other witnesses called for the parties, shall bepaid by the respective party engaging such counsel or calling or engaging suchwitnesses.

 

The decision of thearbitrators shall be rendered within thirty (30) days after appointment of thethird arbitrator.  Such decision shallbe in writing and in duplicate, one counterpart thereof to be delivered to theapplicable Beneficiary and one to the Guarantor.  A judgment of a court of competent jurisdiction may be enteredupon the award of the arbitrators in accordance with the rules and statutesapplicable thereto then obtaining.

 

The Landlord and theGuarantor acknowledge and agree that, to the extent any such dispute shallinvolve any Manager and be subject to arbitration pursuant to such Manager’sManagement Agreement, the Landlord and the Guarantor shall cooperate toconsolidate any such arbitration hereunder and under such Management Agreementinto a single proceeding.

 

16.                                 Modificationof Agreement.  No modification orwaiver of any provision of this Agreement, nor any consent to any departure bythe Guarantor therefrom, shall in any event be effective unless the same shallbe in writing and signed by the Beneficiaries, and such modification, waiver orconsent shall be effective only in the specific instances and for the purposefor which given.  No notice to or demandon the Guarantor in any case shall entitle the Guarantor to any other orfurther notice or demand in the same, similar or other circumstances.  This Agreement may not be amended except byan instrument in writing executed by or on behalf of the party against whomenforcement of such amendment is sought.

 

17.                                 Waiverof Rights by the Beneficiaries. Neither any failure nor any delay on the Beneficiaries’ part inexercising any right, power or privilege under this Agreement shall operate asa waiver thereof, nor shall a single or partial exercise

 

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thereof preclude anyother or further exercise or the exercise of any other right, power orprivilege.

 

18.                                 Severability.  In case any one or more of the provisionscontained in this Agreement should be invalid, illegal or unenforceable in anyrespect, the validity, legality and enforceability of the remaining provisionscontained herein shall not in any way be affected or impaired thereby, but thisAgreement shall be reformed and construed and enforced to the maximum extent permittedby applicable law.

 

19.                                 EntireContract.  This Agreementconstitutes the entire agreement between the parties hereto with respect to thesubject matter hereof and shall supersede and take the place of any otherinstruments purporting to be an agreement of the parties hereto relating to thesubject matter hereof.

 

20.                                 Headings;Counterparts.  Headings in thisAgreement are for purposes of reference only and shall not limit or otherwiseaffect the meaning hereof.  ThisAgreement may be executed in any number of counterparts, each of which shall bean original, but all of which together shall constitute one instrument, and inpleading or proving any provision of this Agreement, it shall not be necessaryto produce more than one of such counterparts.

 

21.                                 RemediesCumulative.  No remedy hereinconferred upon the Beneficiaries is intended to be exclusive of any otherremedy, and each and every remedy shall be cumulative and shall be in additionto every other remedy given hereunder or now or hereafter existing at law or inequity or by statute or otherwise.

 

22.                                 NON-LIABILITYOF TRUSTEES. THE DECLARATION OF TRUST ESTABLISHING THE BENEFICIARIES,COPIES OF WHICH, TOGETHER WITH ALL AMENDMENTS THERETO (THE “DECLARATION”),ARE DULY FILED WITH THE DEPARTMENT OF ASSESSMENTS AND TAXATION OF THE STATE OFMARYLAND, PROVIDE THAT THE NAMES “SNH PROPERTIES TRUST” AND “SNH CHS PROPERTIESTRUST” REFER TO THE TRUSTEES UNDER THE DECLARATIONS COLLECTIVELY AS TRUSTEES,BUT NOT INDIVIDUALLY OR PERSONALLY, AND THAT NO TRUSTEE, OFFICER, SHAREHOLDER,EMPLOYEE OR AGENT OF EITHER BENEFICIARY SHALL BE HELD TO ANY PERSONALLIABILITY, JOINTLY OR SEVERALLY, FOR ANY OBLIGATION OF OR CLAIM AGAINST, SUCHBENEFICIARY.  ALL PERSONS DEALING WITHTHE BENEFICIARIES, IN ANY WAY, SHALL LOOK ONLY TO THE ASSETS OF THEBENEFICIARIES FOR THE PAYMENT OF ANY SUM OR THE PERFORMANCE OF ANY OBLIGATION.

 

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**WITNESS** theexecution hereof under seal as of the date above first written.

 
|   | **FIVE STAR QUALITY CARE, INC.,**            |
|--------|----------------------------------------------|
|   | a Maryland corporation                       |
|   |                                         |
|   |                                         |
|   | /s/  Bruce J. Mackey Jr.                |   |
|   | By: Bruce J. Mackey Jr.                      |
|   | Its: Treasurer and  Chief Financial  Officer |

 

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**EXHIBIT A**

 

**PROPERTIES RELATED TO SNH GUARANTEEDOBLIGATIONS**

 

Ellicott City I and II

3004 North Ridge Road

Ellicott City, Maryland21403

 

HeartHaven at Seabury

100 Seabury Drive

Bloomfield, Connecticut06002

 

HeartHomes at Bay Ridge

3023 Arundale on the BayRoad

Annapolis, Maryland 21403

 

HeartHomes at Linthicum

804 and 806 Camp MeadeRoad

Linthicum, Maryland 21090

 

Hearthomes at Lutherville

1414 and 1420 FrontAvenue

Lutherville, Maryland21093

 

HeartHomes at PineyOrchard

8735 Piney OrchardParkway

Odenton,Maryland 21113

 

HeartHomes at Pasadena

8016 Ritchie Highway

Pasadena,Maryland 21122

 

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