SECURITY AGREEMENT

                            Dated as of July 29, 1998

                                     between

            FIRST SECURITY BANK, NATIONAL ASSOCIATION,
     not individually, but solely as the Owner Trustee under
              the Centennial Real Estate Trust 1998-1
                                       and

                               NATIONSBANK, N.A.,
                  as the Agent for the Lenders and the Holders



                          and accepted and agreed to by

                 CENTENNIAL HEALTHCARE CORPORATION

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                                TABLE OF CONTENTS
      1. Definitions..............................................2

      2. Grant of Security Interest...............................3

      3. Payment of Obligations...................................6

      4. Other Covenants..........................................6

      5. Default; Remedies........................................6

      6. Remedies Not Exclusive...................................7

      7. Performance by the Agent of the Borrower's Obligations...7

      8. Duty of the Agent........................................7

      9. Powers Coupled with an Interest..........................8

      10. Execution of Financing Statements.......................8

      11. Security Agreement Under Uniform Commercial Code........8

      12. Authority of the Agent..................................9

      13. Notices.................................................9

      14. Severability............................................9

      15. Amendment in Writing; No Waivers; Cumulative Remedies..10

      16. Section Headings.......................................10

      17. Successors and Assigns.................................10

      18. The Borrower's Waiver of Rights........................10

      19. GOVERNING LAW..........................................11

      20. Obligations Are Without Recourse.......................11

      21. Partial Release; Full Release..........................11

      22. Miscellaneous..........................................11

      23. Conflicts with Participation Agreement.................12

      24. LESSEE AS A PARTY......................................12



<PAGE>



                               SECURITY AGREEMENT


      This SECURITY AGREEMENT,  dated as of July 29, 1998 (as amended, modified,
extended,  supplemented,  restated  and/or  replaced  from  time to  time,  this
"Security   Agreement"),   is  made  between  FIRST  SECURITY   BANK,   NATIONAL
ASSOCIATION,  a national banking  association,  not individually,  but solely as
Owner Trustee under the  Centennial  Real Estate Trust 1998-1 (the  "Borrower"),
and NATIONSBANK, N.A., a national banking association ("Bank"), as agent for (a)
the Lenders  (hereinafter  defined) under the Credit  Agreement dated as of July
29, 1998 (as amended, modified, extended, supplemented, restated and/or replaced
from time to time,  the  "Credit  Agreement")  by and among  the  Borrower,  the
lending  institutions from time to time parties thereto (the "Lenders") and Bank
as the agent for the  Lenders  and (b) the  holders of the  certificates  issued
pursuant to the Trust Agreement dated as of July 29, 1998 (as amended, modified,
extended,  supplemented,  restated and/or replaced from time to time, the "Trust
Agreement")  among the holders from time to time parties thereto (the "Holders")
and the Borrower,  in its individual  capacity thereunder and in its capacity as
Owner  Trustee  thereunder.  The Lenders and the  Holders,  together  with their
successors and permitted  assigns,  are collectively  referred to hereinafter as
the "Secured Parties." Bank, in its capacity as agent for the Secured Parties is
referred to hereinafter as the "Agent",  and this Security Agreement is accepted
and agreed to by CENTENNIAL HEALTHCARE CORPORATION, a Georgia corporation.

                              Preliminary Statement

      Pursuant to the Credit  Agreement,  the Lenders have  severally  agreed to
make Loans to the  Borrower  in an  aggregate  amount not to exceed  $38,800,000
(subject to increase or decrease in  accordance  with the terms of the Operative
Agreements)  upon the terms and subject to the conditions set forth therein,  to
be evidenced by the Notes  issued by the  Borrower  under the Credit  Agreement.
Pursuant  to the Trust  Agreement,  the  Holders  have  agreed to  purchase  the
ownership  interests of the Trust created thereby in an aggregate  amount not to
exceed $1,200,000  (subject to increase or decrease in accordance with the terms
of the Operative  Agreements)  upon the terms and subject to the  conditions set
forth therein,  to be evidenced by the Certificates issued by the Borrower under
the Trust  Agreement.  The Borrower is, or shall be upon the date of the initial
Advance with respect to each Property,  the legal and  beneficial  owner of such
Property  (except the Borrower may have a ground  leasehold  interest in certain
Properties pursuant to one (1) or more Ground Leases).

      It is a condition,  among others, to the obligation of the Lenders to make
their  respective  Loans to the  Borrower  under the  Credit  Agreement  and the
Holders to make their respective  Holder Advances under the Trust Agreement that
the Borrower  shall have executed and delivered  this Security  Agreement to the
Agent, for the benefit of the Lenders and the Holders.

      NOW, THEREFORE, in consideration of the premises and to induce the Lenders
to make their  respective  Loans  under the Credit  Agreement  and to induce the
Holders to make their respective Holder Advances under the Trust Agreement,  the
Borrower  hereby  agrees with the Agent,  for the benefit of the Lenders and the
Holders, as follows:

      1.   Definitions.

      (a)  As  used  herein,  the  following  terms  shall  have  the  following
respective meanings:

           "Accounts"  shall mean all "accounts," as such term is defined in the
      Uniform  Commercial Code, now owned or hereafter acquired by the Borrower,
      including   without   limitation  (i)  all  accounts   receivable,   other
      receivables,  book  debts  and  other  forms of  obligations  now owned or
      hereafter  received or acquired by or belonging or owing to the  Borrower,
      whether arising out of goods sold or leased or services  rendered by it or
      from  any  other  transaction   (including  without  limitation  any  such
      obligations  which may be  characterized  as an account  under the Uniform
      Commercial  Code),  (ii) all of the Borrower's rights in, to and under all
      purchase  orders or  receipts  now owned or  hereafter  acquired by it for
      goods  or  services,  (iii)  all of the  Borrower's  rights  to any  goods
      represented by any of the foregoing  (including  without limitation unpaid
      sellers'  rights of  rescission,  replevin,  reclamation  and  stoppage in
      transit and rights to returned,  reclaimed or repossessed goods), (iv) all
      monies due or to become due to the Borrower under all purchase  orders and
      contracts for the sale or lease of goods or the performance of services or
      both by the Borrower (whether or not yet earned by performance on the part
      of  the  Borrower  now)  or  hereafter  in  existence,  including  without
      limitation  the right to receive the proceeds of said purchase  orders and
      contracts, and (v) all collateral security and guarantees of any kind, now
      or hereafter in existence,  given by any Person with respect to any of the
      foregoing.

           "Chattel Paper" shall mean any and all "chattel  paper," as such term
      is defined in the Uniform Commercial Code, now owned or hereafter acquired
      by the Borrower, wherever located.

           "Documents"  shall  mean  any and all  "documents",  as such  term is
      defined in the Uniform Commercial Code, now owned or hereafter acquired by
      the Borrower,  wherever located, including without limitation each bill of
      lading,  dock warrant,  dock receipt,  warehouse  receipt or order for the
      delivery of goods, and also any other document which in the regular course
      of business or  financing  is treated as  adequately  evidencing  that the
      person in possession of it is entitled to receive, hold and dispose of the
      document and the goods it covers.

           "General  Intangibles" shall mean any and all "general  intangibles,"
      as such term is  defined  in the  Uniform  Commercial  Code,  now owned or
      hereafter  acquired by the  Borrower,  including  without  limitation  all
      contracts,  undertakings, or agreements in or under which the Borrower may
      now or hereafter have any right (other than any right evidenced by Chattel
      Paper,  Documents or Instruments),  title or interest,  including  without
      limitation any agreements relating to the terms of payment or the terms of
      performance of any Account.

           "Holders" shall have the meaning  specified in the first paragraph of
      this Security Agreement.

           "Instruments"  shall mean any and all "instruments",  as such term is
      defined in the Uniform Commercial Code, now owned or hereafter acquired by
      the  Borrower,   wherever  located,   including  without   limitation  all
      certificated  securities,  all certificates of deposit,  and all notes and
      other,   without  limitation,   evidences  of  indebtedness,   other  than
      instruments  that  constitute,  or are a part of a group of writings  that
      constitute, Chattel Paper.

           "Investment  Property" shall mean any and all "investment  property,"
      as such term is  defined  in the  Uniform  Commercial  Code,  now owned or
      hereafter acquired by the Borrower, wherever located.

           "Lenders" shall have the meaning  specified in the first paragraph of
      this Security Agreement.

           "Lessee"  shall mean  Centennial  Healthcare  Corporation,  a Georgia
      corporation, its successors, permitted assigns and permitted transferees.

           "Obligations" shall mean any and all obligations of the Borrower, now
      existing or hereafter arising under the Credit  Agreement,  the Notes, the
      Trust Agreement, the Certificates
      and/or any other Operative Agreement.

           (b) Capitalized terms used but not otherwise defined in this Security
      Agreement  shall  have the  respective  meanings  specified  in the Credit
      Agreement or Appendix A to the  Participation  Agreement  dated as of July
      29, 1998 (as amended, modified,  extended,  supplemented,  restated and/or
      replaced from time to time in accordance  with the  applicable  provisions
      thereof, the "Participation  Agreement") among Lessee, the various parties
      thereto from time to time, as guarantors,  the Borrower,  the Holders, the
      Lenders,   First  Union  Capital  Markets,   a  division  of  Wheat  First
      Securities,  Inc., as Syndication  Agent, and NationsBank,  N.A., as agent
      for the Lenders and  respecting the Security  Documents,  as agent for the
      Lenders and the Holders, to the extent of their interests.

           (c) The rules of usage set forth in  Appendix A to the  Participation
      Agreement shall apply to this Agreement.

      2.   Grant of Security Interest.

      To secure payment of all the amounts  advanced under the Credit  Agreement
in connection with the Notes, all the amounts advanced or contributed  under the
Trust Agreement in connection with the Certificates and all other amounts now or
hereafter owing to the Lenders, the Holders or the Agent thereunder or under any
other  Operative  Agreement,  THE  BORROWER  HEREBY  CONVEYS,  GRANTS,  ASSIGNS,
TRANSFERS, HYPOTHECATES, MORTGAGES AND SETS OVER TO THE AGENT FOR THE BENEFIT OF
THE SECURED PARTIES, A FIRST PRIORITY SECURITY INTEREST IN AND LIEN ON THE TRUST
ESTATE,  WHETHER NOW EXISTING OR HEREAFTER ACQUIRED INCLUDING WITHOUT LIMITATION
THE FOLLOWING:

                (a) all right,  title and interest of the Borrower in and to the
           Operative  Agreements  now  existing  or  hereafter  acquired  by the
           Borrower  (including  without  limitation  all rights to payment  and
           indemnity rights of the Borrower under the  Participation  Agreement)
           (all of the foregoing in this  paragraph (a) being referred to as the
           "Rights in Operative Agreements");

                (b)  all right,  title and interest of the Borrower
           in and to all of the Equipment;

                (c)  all right,  title and interest of the Borrower
           in and to all of the Fixtures;

                (d) all the estate,  right, title, claim or demand whatsoever of
           the Borrower,  in possession or expectancy,  in and to each Property,
           Fixture or Equipment or any part thereof;

                (e) all right,  title and interest of the Borrower in and to all
           substitutes,  modifications  and  replacements of, and all additions,
           accessions   and   improvements   to,  the  Fixtures  and  Equipment,
           subsequently  acquired  or leased  by the  Borrower  or  constructed,
           assembled or placed by the Borrower on any Property, immediately upon
           such acquisition,  lease, construction,  assembling or placement, and
           in each such case,  without any  further  conveyance,  assignment  or
           other act by the Borrower;

                (f) all right,  title and  interest of the  Borrower  in, to and
           under books and records  relating to or used in  connection  with the
           operation  of one (1) or more  Properties  or any part  thereof;  all
           rights of the Borrower to the payment of money and all property;  and
           all  rights in and to any causes of action or choses in action now or
           hereafter  existing  in favor of the  Borrower  and all rights to any
           recoveries therefrom;

                (g) all right,  title and interest of the Borrower in and to all
           unearned  premiums under insurance  policies now held or subsequently
           obtained by the Lessee relating to one (1) or more Properties and the
           Borrower's  interest in and to all proceeds of any insurance policies
           maintained by or for the benefit of the Borrower,  including  without
           limitation  any right to collect and receive such  proceeds;  and all
           awards  and other  compensation,  including  without  limitation  the
           interest  payable  thereon  and any right to collect  and receive the
           same, made to the present or any subsequent owner of any Property for
           the taking by eminent domain,  condemnation  or otherwise,  of all or
           any part of any Property or any easement or other right therein;

                (h) all right,  title and interest of the Borrower in and to (i)
           all consents, licenses, certificates and other governmental approvals
           relating  to  construction,  completion,  use  or  operation  of  any
           Property or any part  thereof  and (ii) all Plans and  Specifications
           relating to any Property;

                (i) all right,  title and interest of the Borrower in and to all
           Rent  and all  other  rents,  payments,  purchase  prices,  receipts,
           revenues,  issues and profits  payable under the Lease or pursuant to
           any other lease with respect to any Property;

                (j) all right,  title and interest of the Borrower in and to all
           Instruments and Documents;

                (k) all right,  title and interest of the Borrower in and to all
           General Intangibles;

                (l) all right,  title and interest of the Borrower in and to all
           Chattel  Paper  (including  without  limitation  all rights under the
           Lease) and each Ground Lease;

                (m) all right,  title and interest of the Borrower in and to all
           money,   cash  or  cash  equivalent  and  bank  accounts   (including
           specifically  without limitation any amounts held by the Agent or any
           escrow  agent on behalf of the  Borrower  as  referred  to in Section
           5.2(d) of the Participation Agreement);

                (n)  all right,  title and interest of the Borrower
           in and to all Accounts;

                (o) all right,  title and interest of the Borrower in and to all
           proceeds  of letters  of credit  issued in favor of the  Borrower  in
           connection with any Property; and

                (p) all right,  title and interest of the Borrower in and to all
           proceeds, both cash and noncash, of any of the foregoing.

      (All of the foregoing  property and rights and interests now owned or held
or subsequently  acquired by the Borrower and described in the foregoing clauses
(a) through (p) are collectively referred to as the "Trust Property").

      TO HAVE AND TO HOLD the  Trust  Property  and the  rights  and  privileges
hereby  granted  unto the Agent (for the benefit of the Lenders and the Holders)
its successors and assigns for the uses and purposes set forth, until all of the
obligations  of the Borrower  under the Operative  Agreements  are paid in full;
provided, that EXCLUDED from the Trust Property at all times and in all respects
shall be all Excepted Payments.

      3.   Payment of Obligations.

      The Borrower shall pay all Obligations in accordance with the terms of the
Credit Agreement, the Notes, the Trust Agreement, the Certificates and the other
Operative  Agreements  and  perform  each term to be  performed  by it under the
Credit Agreement, the Notes, the Trust Agreement, the Certificates and the other
Operative Agreements.

      4.   Other Covenants.

      At any time and from time to time,  upon the written request of the Agent,
and at the expense of the Borrower  (with funds  provided by the Lessee for such
purpose),  the Borrower  will promptly and duly execute and deliver such further
instruments and documents and take such further actions as the Agent  reasonably
may request for the  purposes of obtaining or  preserving  the full  benefits of
this Security  Agreement  and of the rights and powers  granted by this Security
Agreement.

      5.   Default; Remedies.

           (a) If a  Credit  Agreement  Event of  Default  has  occurred  and is
continuing:

                     (i) the Agent, in addition to all other remedies  available
           at law or in equity, shall have the right forthwith to enter upon any
           Property  (or any other place where any  component of any Property is
           located at such time) without  charge,  and take possession of all or
           any portion of the Trust  Property,  and to re-let the Trust Property
           and receive the rents,  issues and profits  thereof,  to make repairs
           and to apply said rentals and profits, after payment of all necessary
           or proper  charges and  expenses,  on account of the  amounts  hereby
           secured (subject to the Excepted Payments); and

                     (ii) the Agent, shall, as a matter of right, be entitled to
           the  appointment  of a  receiver  for  the  Trust  Property,  and the
           Borrower hereby consents to such appointment and waives notice of any
           application therefor.

           (b) If a  Credit  Agreement  Event of  Default  has  occurred  and is
      continuing,  the Agent may proceed by an action at law,  suit in equity or
      other appropriate  proceeding,  to protect and enforce its rights, whether
      for the  foreclosure  of the Lien of this Security  Agreement,  or for the
      specific   performance  of  any  agreement  contained  herein  or  for  an
      injunction  against the violation of any of the terms hereof. The proceeds
      of any sale of any of the Trust  Property  shall be  applied  pursuant  to
      Section 8.7 of the  Participation  Agreement.  In addition,  the Agent may
      proceed under Section 11 hereof.

           (c) To the extent  permitted by Law, the Borrower  hereby  waives the
      benefit of all  appraisement,  valuation,  stay,  extension and redemption
      laws now or hereafter in force and all rights of  marshalling in the event
      of any sale of the Trust  Property  or any  portion  thereof  or  interest
      therein.

      6.   Remedies Not Exclusive.

      The Agent  shall be entitled to enforce  payment of the  indebtedness  and
performance of the  Obligations and to exercise all rights and powers under this
Security  Agreement  or under any of the  other  Operative  Agreements  or other
agreements or any laws now or hereafter in force, notwithstanding some or all of
the  Obligations may now or hereafter be otherwise  secured,  whether by deed of
trust,  mortgage,  security agreement,  pledge,  Lien,  assignment or otherwise.
Neither the  acceptance of this Security  Agreement nor its  enforcement,  shall
prejudice or in any manner  affect the Agent's  right to realize upon or enforce
any other security now or hereafter held by the Agent,  it being agreed that the
Agent  shall be  entitled  to  enforce  this  Security  Agreement  and any other
security  now or  hereafter  held by the Agent in such  order and  manner as the
Agent may determine in its absolute discretion. No remedy conferred hereunder or
under any other Operative Agreement upon or reserved to the Agent is intended to
be  exclusive  of any other  remedy  herein or  therein  or by law  provided  or
permitted,  but each shall be cumulative and shall be in addition to every other
remedy given  hereunder or thereunder or now or hereafter  existing at law or in
equity  or by  statute.  Every  power or  remedy  given by any of the  Operative
Agreements  to the  Agent or to  which  it may  otherwise  be  entitled,  may be
exercised,  concurrently or independently, from time to time and as often as may
be deemed  expedient by the Agent.  In no event shall the Agent, in the exercise
of  the  remedies  provided  in  this  Security  Agreement   (including  without
limitation  in  connection  with the  assignment  of Rents to the Agent,  or the
appointment of a receiver and the entry of such receiver onto all or any part of
the Land),  be deemed a "mortgagee in possession" or a "pledgee in  possession",
and the  Agent  shall  not in any way be made  liable  for any  act,  either  of
commission or omission, in connection with the exercise of such remedies.

      7. Performance by the Agent of the Borrower's Obligations.

      If the  Borrower  fails to  perform or comply  with any of its  agreements
contained herein the Agent, at its option,  but without any obligation so to do,
may perform or comply, or otherwise cause  performance or compliance,  with such
agreement.  The  expenses  of the Agent  incurred  in  connection  with  actions
undertaken as provided in this Section 7,  together  with interest  thereon at a
rate per annum equal to the Overdue Rate,  from the date of payment by the Agent
to the date  reimbursed by the Borrower,  shall be payable by the Borrower (with
funds  provided  by the  Lessee  for such  purpose)  to the Agent on demand  and
constitutes part of the Obligations secured hereby.

      8.   Duty of the Agent.

      The  Agent's  sole duty  with  respect  to the  custody,  safekeeping  and
physical  preservation  of any Trust Property in its  possession,  under Section
9-207 of the Uniform  Commercial Code or otherwise,  shall be to deal with it in
the same manner as the Agent deals with  similar  property  for its own account.
Neither the Agent, any Lender, any Holder nor any of their respective directors,
officers,  employees,  shareholders,  partners  or agents  shall be  liable  for
failure to demand,  collect or realize upon any of the Trust Property or for any
delay in doing so or shall be under any obligation to sell or otherwise  dispose
of any Trust Property upon the request of the Borrower or any other Person or to
take any other action  whatsoever  with regard to the Trust Property or any part
thereof.

      9.   Powers Coupled with an Interest.

      All  powers,  authorizations  and  agencies  contained  in  this  Security
Agreement are coupled with an interest and are  irrevocable  until this Security
Agreement is terminated and the Liens created hereby are released.

      10.  Execution of Financing Statements.

      Pursuant to Section  9-402 of the Uniform  Commercial  Code,  the Borrower
authorizes  the Agent at the expense of the  Borrower  (such  amounts to be paid
with funds provided by the Lessee for such purpose) to file financing statements
with respect to the Trust  Property  under this Security  Agreement  without the
signature of the  Borrower in such form and in such filing  offices as the Agent
reasonably determines appropriate to perfect the security interests of the Agent
under this Security Agreement.  A carbon,  photographic or other reproduction of
this Security Agreement shall be sufficient as a financing  statement for filing
in any  jurisdiction.  For purposes of such  financing  statement,  the Borrower
shall be  deemed  to be the  debtor,  and the  Agent  shall be  deemed to be the
secured  party.  The address of the Borrower is 79 South Main Street,  Salt Lake
City, Utah 84111,  Attention:  Val T. Orton, Vice President,  and the address of
the Agent is Atlanta  Plaza  Building,  600  Peachtree  Street,  NE, 17th Floor,
Atlanta, Georgia 30303, Attention: Chris Jones.

      11.  Security Agreement Under Uniform Commercial Code.

           (a) It is the  intention  of the parties  hereto  that this  Security
      Agreement as it relates to matters of the grant,  perfection  and priority
      of security  interests  the subject  hereof,  shall  constitute a security
      agreement within the meaning of the Uniform  Commercial Code of the States
      in which the Trust  Property is located.  If a Credit  Agreement  Event of
      Default  shall  occur and be  continuing,  then in  addition to having any
      other right or remedy available at law or in equity, the Agent may proceed
      under the applicable  Uniform Commercial Code and exercise such rights and
      remedies as may be provided to a secured party by such Uniform  Commercial
      Code with  respect to all or any  portion of the Trust  Property  which is
      personal property  (including  without limitation taking possession of and
      selling  such  property).  If the Agent shall  elect to proceed  under the
      Uniform  Commercial  Code,  then  fifteen (15) days' notice of sale of the
      personal  property  shall be deemed  reasonable  notice and the reasonable
      expenses of retaking,  holding,  preparing for sale,  selling and the like
      incurred by the Agent  shall  include,  but not be limited to,  attorneys'
      fees and legal  expenses.  At the  Agent's  request,  the  Borrower  shall
      assemble  such  personal  property and make it available to the Agent at a
      place  designated  by the Agent  which is  reasonably  convenient  to both
      parties.

           (b) The Borrower,  upon reasonable  request by the Agent from time to
      time, shall execute,  acknowledge and deliver to the Agent one (1) or more
      separate  security  agreements,  in form  reasonably  satisfactory  to the
      Agent,  covering  all or any part of the Trust  Property  and will further
      execute,  acknowledge and deliver,  or cause to be executed,  acknowledged
      and delivered, any financing statement, affidavit,  continuation statement
      or certificate  or other  document as the Agent may reasonably  request in
      order to perfect,  preserve,  maintain,  continue  or extend the  security
      interest  under,  and the priority of the Liens  granted by, this Security
      Agreement and such security instrument. The Borrower further agrees to pay
      to the Agent  (with  funds  provided  by the Lessee for such  purpose)  on
      demand all costs and expenses incurred by the Agent in connection with the
      preparation,  execution,  recording,  filing  and  re-filing  of any  such
      document and all reasonable  costs and expenses of any record searches for
      financing statements the Agent shall reasonably require. The filing of any
      financing or continuation  statements in the records  relating to personal
      property or chattels  shall not be construed as in any way  impairing  the
      right of the Agent to proceed  against  any  property  encumbered  by this
      Security Agreement.

      12.  Authority of the Agent.

      The  Borrower  acknowledges  that the rights and  responsibilities  of the
Agent under this  Security  Agreement  with  respect to any action  taken by the
Agent or the exercise or non-exercise by the Agent of any option,  voting right,
request,  judgment or other right or remedy  provided for herein or resulting or
arising out of this Security Agreement shall be governed by the Credit Agreement
and Section 8.6 of the Participation Agreement and by such other agreements with
respect  thereto as may exist from time to time  (until such time as all amounts
due  and  owing  to the  Secured  Parties  and the  Agent  under  the  Operative
Agreements have been paid in full), but the Agent shall be conclusively presumed
to be acting as agent for the Secured  Parties with full and valid  authority so
to act or refrain from acting, and the Borrower shall be under no obligation, or
entitlement, to make any inquiry respecting such authority.

      13.  Notices.

      All  notices  required  or  permitted  to be  given  under  this  Security
Agreement  shall be in writing and  delivered as provided in Section 12.2 of the
Participation Agreement.

      14.  Severability.

      Any  provision  of  this  Security   Agreement   which  is  prohibited  or
unenforceable  shall  be  ineffective  to the  extent  of  such  prohibition  or
unenforceability without invalidating the remaining provisions hereof.

      15. Amendment in Writing; No Waivers; Cumulative Remedies.

           (a) None of the terms or provisions of this Security Agreement may be
      waived,  amended,  supplemented or otherwise modified except in accordance
      with the terms of Section 12.4 of the Participation Agreement.

           (b) No failure to exercise, nor any delay in exercising,  on the part
      of the Agent, any right,  power or privilege  hereunder shall operate as a
      waiver  thereof.  No single or partial  exercise  of any  right,  power or
      privilege  hereunder shall preclude any other or further  exercise thereof
      or the exercise of any other right,  power or  privilege.  A waiver by the
      Agent of any right or remedy  hereunder on any one (1) occasion  shall not
      be  construed  as a bar to any  right or  remedy  which  the  Agent  would
      otherwise have on any future occasion.

           (c) The rights and remedies herein  provided are  cumulative,  may be
      exercised singly or concurrently and are not exclusive of any other rights
      or remedies provided by law.

      16.  Section Headings.

      The section  headings used in this Security  Agreement are for convenience
of reference only and are not to affect the construction hereof or be taken into
consideration in the interpretation hereof.

      17.  Successors and Assigns.

      This  Security  Agreement  shall be  binding  upon the  successors  of the
Borrower,  and the  Borrower  shall not assign any of its rights or  obligations
hereunder or with respect to any of the Trust Property without the prior written
consent of the Agent. This Security  Agreement shall inure to the benefit of the
Agent, the Lenders, the Holders and their respective  successors and assigns, in
accordance with their respective interest herein.

      18.  The Borrower's Waiver of Rights.

      Except as otherwise set forth herein or in any other Operative  Agreement,
to the fullest extent  permitted by law, the Borrower  waives the benefit of all
laws now  existing or that may  subsequently  be enacted  providing  for (a) any
appraisement before sale of any portion of the Trust Property, (b) any extension
of the time for the  enforcement  of the collection of the  indebtedness  or the
creation or extension of a period of redemption from any sale made in collecting
such  debt  and  (c)  exemption  of any  portion  of  the  Trust  Property  from
attachment, levy or sale under execution or exemption from civil process. Except
as otherwise set forth herein, to the fullest extent the Borrower may do so, the
Borrower agrees that the Borrower will not at any time insist upon, plead, claim
or take the benefit or advantage of any law now or hereafter in force  providing
for any appraisement,  valuation,  stay, exemption,  extension or redemption, or
requiring  foreclosure of this Security  Agreement  before  exercising any other
remedy granted  hereunder and the Borrower,  for the Borrower and its successors
and assigns, and for any and all Persons ever claiming any interest in the Trust
Property,  to the extent permitted by law, hereby waives and releases all rights
of redemption, valuation, appraisement, stay of execution, notice of election to
mature or declare due the whole of the  Obligations and marshalling in the event
of foreclosure of the Liens hereby created.

      19.  GOVERNING LAW.

      EXCEPT AS  OTHERWISE  EXPRESSLY  PROVIDED  IN  SECTION  11(a)
HEREOF,   THIS  SECURITY   AGREEMENT  SHALL  BE  GOVERNED  BY,  AND
CONSTRUED,   INTERPRETED  AND  ENFORCED  IN  ACCORDANCE  WITH,  THE
INTERNAL LAWS OF THE STATE OF NORTH CAROLINA.

      20.  Obligations Are Without Recourse.

The  provisions  of the  Participation  Agreement  relating  to  limitations  on
liability are hereby incorporated by reference herein, Mutatis Mutandis.

      21.  Partial Release; Full Release.

      The Agent may release for such consideration as it may require any portion
of the Trust Property without (as to the remainder of the Trust Property) in any
way  impairing  or affecting  the Lien,  security  interest and priority  herein
provided  for the Agent  compared  to any other Lien  holder or  secured  party.
Further,  the Agent shall execute and deliver to the Borrower such documents and
instruments as may be required to release the Lien and security interest created
by this Security Agreement with respect to the Properties as provided in Section
8.8 of the  Participation  Agreement  or to grant the  easements  and permit the
other matters provided for in Section 8.5 of the Participation Agreement.

      22.  Miscellaneous.

           (a) This Security  Agreement is one (1) of the documents which create
      Liens and security  interests that secure  payment and  performance of the
      Obligations.  The Agent, at its election, may commence or consolidate in a
      single action all  proceedings to realize upon all such Liens and security
      interests.   The  Borrower   hereby  waives  (i)  any  objections  to  the
      commencement  or  continuation  of an action to foreclose the Lien of this
      Security  Agreement or exercise of any other remedies  hereunder  based on
      any action being  prosecuted  or any judgment  entered with respect to the
      Obligations  or any Liens or security  interests  that secure  payment and
      performance of the Obligations and (ii) any objections to the commencement
      of, continuation of, or entry of a judgment in any such other action based
      on any action or judgment connected to this Security Agreement. In case of
      a  foreclosure  sale,  the  Trust  Property  may be sold,  at the  Agent's
      election,  in one (1)  parcel or in more than one (1) parcel and the Agent
      is  specifically  empowered  (without  being required to do so, and in its
      sole and absolute discretion) to cause successive sales of portions of the
      Trust Property to be held.

           (b) This Security Agreement may not be amended, waived, discharged or
      terminated  except in  accordance  with Section 12.4 of the  Participation
      Agreement.  Upon the prior written consent of the Majority Secured Parties
      and unless such matter is a Unanimous  Vote Matter,  the Agent may release
      any portion of the Trust  Property or any other  security,  and grant such
      extensions and indulgences in relation to the  Obligations  secured hereby
      without in any manner  affecting  the  priority  of the Lien hereof on any
      part of the Trust Property.

           (c)  THE  PROVISIONS  OF  THE  PARTICIPATION  AGREEMENT  RELATING  TO
      SUBMISSION TO  JURISDICTION,  VENUE ARE HEREBY  INCORPORATED  BY REFERENCE
      HEREIN, MUTATIS MUTANDIS.

      23.  Conflicts with Participation Agreement.

      Notwithstanding  any other provision  hereof, in the event of any conflict
between the terms of this Security  Agreement and the  Participation  Agreement,
the terms of the Participation Agreement shall govern.

      24.  LESSEE AS A PARTY.

      LESSEE HAS EXECUTED THIS SECURITY  AGREEMENT FOR THE PURPOSE OF SUBJECTING
TO THE SECURITY INTERESTS GRANTED HEREUNDER ALL OF ITS RIGHT,  TITLE, ESTATE AND
INTEREST,  IF ANY, IN AND TO THE TRUST PROPERTY TO SECURE ALL OBLIGATIONS OF ALL
CREDIT PARTIES UNDER THE OPERATIVE AGREEMENTS. ACCORDINGLY, LESSEE HEREBY GRANTS
TO THE AGENT  (FOR THE  BENEFIT  OF THE  LENDERS  AND THE  HOLDERS)  A  SECURITY
INTEREST IN AND TO ALL OF ITS RIGHT, TITLE, ESTATE AND INTEREST,  IF ANY, IN AND
TO THE TRUST  PROPERTY  (TO THE EXTENT  LESSEE HAS ANY RIGHT,  TITLE OR INTEREST
THEREIN AND WITHOUT  REGARD TO ANY  LANGUAGE IN SECTION 2 OR THE  DEFINITION  OF
"TRUST  PROPERTY' OR ANY DEFINITION OF ANY ITEM  CONSTITUTING THE TRUST PROPERTY
WHICH OTHERWISE WOULD LIMIT THE TRUST PROPERTY TO THE RIGHT,  TITLE AND INTEREST
OF THE BORROWER  THEREIN) TO SECURE ALL  OBLIGATIONS OF ALL CREDIT PARTIES UNDER
THE  OPERATIVE  AGREEMENTS.  LESSEE  ACKNOWLEDGES  AND  AGREES  THAT,  UPON  THE
OCCURRENCE  OF AN EVENT OF  DEFAULT,  THE AGENT SHALL HAVE THE RIGHT TO EXERCISE
ANY OR ALL OF ITS REMEDIES HEREUNDER AS AGAINST ANY SUCH RIGHT, TITLE, ESTATE OR
INTEREST OF LESSEE IN OR TO THE TRUST PROPERTY.

                            [signature page follows]


<PAGE>



                                                 Security Agreement
                                Centennial Real Estate Trust 1998-1
CHAR1\WMA\BANK\400940_ 9

                                Centennial Real Estate Trust 1998-1
      IN WITNESS  WHEREOF,  each of the  undersigned  have  caused the  Security
Agreement to be duly executed and delivered as of the date first above written.


                               FIRST SECURITY BANK,  NATIONAL  ASSOCIATION,  not
                               individually,  but  solely as the  Owner  Trustee
                               under the Centennial Real Estate Trust
                               1998-1



                               By:/s/ Val T. Orton
                               Name: Val T. Orton
                                   Title:V.P.



                               NATIONSBANK, N.A., as the Agent for
                               the Lenders and the Holders



                               By:/s/ J. Walter Bland
                               Name: J.W. Bland
                               Title: V.P.




Accepted and Agreed to:

CENTENNIAL HEALTHCARE CORPORATION

By: /s/    Alan C. Dahl
Name:      Alan C. Dahl
Title:     E.V.P.